Document:

Document

Exhibit 10.9
AMENDED AND RESTATED EMPLOYMENT AGREEMENT

This AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this “Agreement”), dated as of May 5, 2022 (the “Effective Date”), is between Vistra Corp., Luminant Energy Company LLC (together, the “Company”), and Stephen J. Muscato (“Executive”).
Recitals:
WHEREAS, the Company and Executive previously entered into an agreement effective as of March 9, 2018 (the “Original Effective Date”);
WHEREAS, the Company and Executive subsequently entered into an amended and restated employment agreement (the “Prior Employment Agreement”) effective as of February 25, 2020 (the “Second Effective Date”); and
WHEREAS, the Company and Executive desire to amend and restate the Prior Employment Agreement to reflect the terms upon which Executive shall continue to provide services to the Company.
NOW, THEREFORE, in consideration of the premises and covenants contained herein, and intending to be legally bound hereby, the parties to this Agreement hereby agree as follows:
1.Term. 
(a)  The term of Executive’s employment under this Agreement shall be effective as of the Effective Date, and shall continue until the three (3)-year anniversary of the Effective Date (the “Initial Expiration Date”); provided that on the Initial Expiration Date and each subsequent anniversary of the Initial Expiration Date, the term of Executive’s employment under this Agreement shall be extended for one (1) additional year unless either party provides written notice to the other party at least sixty (60) days prior to the Initial Expiration Date (or any such anniversary, as applicable) that Executive’s employment shall not be so extended (in which case, Executive’s employment shall terminate on the Initial Expiration Date or any such anniversary, as applicable); provided, however, that Executive’s employment under this Agreement may be terminated at any earlier time pursuant to the provisions of Section 5. The period of time from the Effective Date through the termination of this Agreement and Executive’s employment hereunder pursuant to its terms is herein referred to as the “Term”; and the date on which the Term is scheduled to expire (i.e., the Initial Expiration Date or the scheduled expiration of the extended term, if applicable) is herein referred to as the “Expiration Date.”  
(b)    Executive agrees and acknowledges that the Company has no obligation to extend the Term or to continue Executive’s employment following the Expiration Date, and Executive expressly acknowledges that no promises or understandings to the contrary have been made or reached.  
2.Definitions.  For purposes of this Agreement, the following terms, as used herein, shall have the definitions set forth below.

(a)“Affiliate” means, with respect to any specified Person, any other Person that directly or indirectly, through one or more intermediaries, Controls, is Controlled by, or is under common Control with, such specified Person.
(b)“Change in Control” shall be deemed to occur upon any of the following events: 
(i)the acquisition by any Person or related “group” (as such term is used in Sections 13(d) and 14(d) of the U.S. Securities Exchange Act of 1934, as amended, and any successor thereto (the “Exchange Act”)) of Beneficial Ownership (as defined in Rule 13d-3 promulgated under Section 13 of the Exchange Act) of 30% or more (on a fully diluted basis) of either (A) the then-outstanding shares of the common stock of the Company (the “Common Stock”), including Common Stock issuable upon the exercise of options or warrants, the conversion of convertible stock or debt, and the exercise of any similar right to acquire such Common Stock (the “Outstanding Company Common Stock”); or (B) the combined voting power of the then-outstanding voting securities of the Company entitled to vote in the election of directors (the “Outstanding Company Voting Securities”); but excluding any acquisition by the Company or any of its Affiliates or by any employee benefit plan sponsored or maintained by the Company or any of its Affiliates;
(ii)a change in the composition of the Board such that members of the Board during any consecutive twelve (12)-month period (the “Incumbent Directors”) cease to constitute a majority of the Board.  Any person becoming a director through election or nomination for election approved by a valid vote of at least two thirds of the Incumbent Directors shall be deemed an Incumbent Director; provided, however, that no individual becoming a director as a result of an actual or threatened election contest, as such terms are used in Rule 14a-12 of Regulation 14A promulgated under the Exchange Act, or as a result of any other actual or threatened solicitation of proxies or consents by or on behalf of any person other than the Board shall be deemed an Incumbent Director;
(iii)the approval by the shareholders of the Company of a plan of complete dissolution or liquidation of the Company; or
(iv)the consummation of a reorganization, recapitalization, merger, consolidation, statutory share exchange or similar form of corporate transaction involving the Company (a “Business Combination”), or sale, transfer or other disposition of all or substantially all of the business or assets of the Company to an entity that is not an Affiliate of the Company (a “Sale”), unless immediately following such Business Combination or Sale:  (A) more than 50% of the total voting power of the entity resulting from such Business Combination or the entity that acquired all or substantially all of the business or assets of the Company in such Sale (in either case, the “Surviving Company”), or the ultimate parent entity that has Beneficial Ownership of sufficient voting power to elect a majority of the board of directors (or analogous governing body) of the Surviving Company (the “Parent Company”), is represented by the Outstanding Company Voting Securities that were outstanding immediately prior to such Business Combination or Sale (or, if applicable, is represented by shares into which the Outstanding Company Voting Securities were converted pursuant to such Business Combination or Sale), and such voting power among the holders thereof is in substantially the same proportion as the voting power of the Outstanding Company Voting Securities among the holders thereof immediately prior to the Business Combination or Sale, (B) no Person or related group of Persons (other than any employee benefit plan sponsored or maintained by the Surviving Company or the Parent Company) is or becomes the beneficial owner, directly or indirectly, of 50% or more of the total 
     2

voting power of the outstanding voting securities eligible to elect members of the board of directors (or the analogous governing body) of the Parent Company (or, if there is no Parent Company, the Surviving Company) and (C) at least a majority of the members of the board of directors (or the analogous governing body) of the Parent Company (or, if there is no Parent Company, the Surviving Company) following the consummation of the Business Combination or Sale were Board members at the time of the Board’s approval of the execution of the initial agreement providing for such Business Combination or Sale.
(c)“Cause” means (i) Executive’s willful and continued failure to perform Executive’s duties with the Company; (ii) Executive’s willful and continued failure to follow and comply with the written policies of the Company as in effect from time to time; (iii) Executive’s willful commission of an act of fraud or dishonesty resulting in economic or financial injury to the Company; (iv) Executive’s willful engagement in illegal conduct or gross misconduct; (v) Executive’s willful breach of this Agreement; or (vi) Executive’s indictment for, conviction of, or a plea of guilty or nolo contendere to any felony or other crime involving moral turpitude.  No act or failure to act will be treated as willful if it is done, or omitted to be done, by Executive in good faith and with a good faith belief that such act or omission was in the best interests of the Company.
(d)“Control” (including, with correlative meanings, the terms “Controlled by” and “under common Control with”), as used with respect to any Person, means the direct or indirect possession of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities or by contract.  
(e)“Disability” means Executive would be entitled to long-term disability benefits under the Company’s long-term disability plan as in effect from time to time, without regard to any waiting or elimination period under such plan and assuming for the purpose of such determination that Executive is actually participating in such plan at such time.  If the Company does not maintain a long-term disability plan, “Disability” means Executive’s inability to perform Executive’s duties and responsibilities hereunder on a full-time basis for a consecutive period of one hundred eighty (180) days due to physical or mental illness or incapacity that is determined to be total and permanent by a physician selected by the Company or its insurers and reasonably acceptable to Executive or Executive’s legal representative.
(f)“Good Reason” means the occurrence, without the consent of Executive, of either of the following events: (i) any material diminution of, or modification to, Executive’s title, duties, responsibilities, authorities, or terms of employment set forth in Section 3 or (ii) any breach by the Company of any of its material obligations to Executive.  Prior to resigning for Good Reason, Executive shall give written notice to the Company of the facts and circumstances claimed to provide a basis for such resignation not more than sixty (60) days following Executive’s knowledge of such facts and circumstances, and the Company shall have ten (10) business days after receipt of such notice to cure (and if so cured, Executive shall not be permitted to resign for Good Reason in respect thereof) and Executive shall resign within ten (10) business days following the Company’s failure to cure.  
(g)“Person” means any individual, firm, corporation, partnership, limited liability company, trust, joint venture, association, unincorporated entity, or other entity.
3.Duties and Responsibilities.  The Company employs Executive, and Executive accepts employment, subject to the terms and conditions contained herein, during the Term, as the Executive Vice President and Chief Commercial Officer. During the Term, Executive agrees to be employed by and devote all of Executive’s business time and attention to the Company and the promotion of its interests and to use Executive’s best efforts to faithfully 
     3

and diligently serve the Company; provided, however, that, to the extent that such activities do not significantly interfere with the performance of Executive’s duties, services, and responsibilities under this Agreement, Executive shall be permitted to (a) manage Executive’s personal, financial, and legal affairs, (b) serve on civic or charitable boards and committees of such boards and (c) to the extent approved by the Board of Directors of the Company (the “Board”) pursuant to a duly authorized resolution of the Board, serve on corporate boards and committees of such boards.  Executive will report to the Chief Executive Officer. Executive will perform such lawful duties and responsibilities as are commensurate with Executive’s title and position, and such other duties and responsibilities commensurate with Executive’s title and position as may be reasonably requested by the Chief Executive Officer and the Board from time to time. Executive will have the authority customarily exercised by an individual serving as an Executive Vice President of a corporation of the size and nature of the Company. Executive’s place of employment will be in Irving, Texas.
4.Compensation and Related Matters.  (a)  Base Salary.  During the Term, Executive shall receive an aggregate annual base salary (“Base Salary”) at an initial rate of $634,400.00, payable in accordance with the Company’s applicable payroll practices.  Base Salary shall be reviewed annually by the Board and increased (but not decreased) in the Board’s sole discretion.  References in this Agreement to Base Salary shall be deemed to refer to the most recently effective annual base salary rate.
(b)    Annual Bonus.  During the Term, Executive shall be eligible to receive a cash bonus (the “Annual Bonus”) for each year (or portion thereof), provided that, except as otherwise provided herein, Executive has remained employed by the Company as of the applicable payment date.  Executive’s target bonus opportunity for any particular year (the “Target Bonus”) shall be 100% of Base Salary, and Executive’s maximum bonus opportunity shall be 200% of the Target Bonus.  The Annual Bonus shall be subject to performance metrics approved by the Board based on key short-term objectives and shall be at the full discretion of the Board.  Any Annual Bonus shall be paid in the fiscal year following the fiscal year to which such Annual Bonus relates, at the same as annual bonuses are paid to all other senior executives.
(c)    Equity Compensation.  Executive shall be entitled to receive equity compensation awards as described in Exhibit A.  
(d)    Benefits and Perquisites.  During the Term, Executive shall be entitled to participate in the benefit plans and programs and receive perquisites that are provided by the Company from time to time for its senior executives generally, subject to the terms and conditions of such plans and programs, as they may be amended from time to time, and commensurate with Executive’s position.  During the Term, Executive shall be entitled to up to $15,000 per year for tax and financial planning.  
     4

(e)    Business Expense Reimbursements.  During the Term, the Company shall promptly reimburse Executive for Executive’s reasonable and necessary business expenses in accordance with the Company’s then-prevailing policies and procedures for expense reimbursement (which shall include appropriate itemization and substantiation of expenses incurred).  
(f)    Indemnification.  The Company shall indemnify and hold harmless Executive, to the fullest extent permitted by law and the Company’s governing documents, against all claims, expenses, damages, liabilities, and losses incurred by Executive (whether before or after the Original Effective Date) by reason of the fact that Executive is or was, or had agreed to become, a consultant, director, officer, employee, agent, or fiduciary of the Company or any of its subsidiaries or Affiliates or predecessors of any of the foregoing, or any benefit plan of any of the foregoing, or is or was serving at the request of the Company as a consultant, director, officer, partner, venturer, proprietor, trustee, employee, agent, fiduciary, or similar functionary of another corporation, partnership, joint venture, business, person, trust, employee benefit plan, or other entity.  The Company shall provide Executive with customary directors’ and officers’ liability insurance coverage both during and after the Term with regard to matters occurring during employment or while otherwise providing services to, or serving at the request of, the Company or any of its subsidiaries or Affiliates, or any benefit plan of any of the foregoing, which coverage shall be at a level at least equal to the greatest level being maintained at such time for any current officer or director and shall continue until such time as suits can no longer be brought against Executive as a matter of law.  Executive will be entitled to advancement of expenses in connection with any claim in the same manner and to the same extent to which any other officer or director of the Company is entitled.  Notwithstanding the foregoing, the Company shall not be required to indemnify or advance expenses to Executive in connection with (i) any dispute in connection with this Agreement or Executive’s employment hereunder; (ii) any action, claim, or proceeding initiated by Executive against the Company unless such action, claim, or proceeding is approved in advance by the Board in writing; or (iii) any liabilities, damages, claims or expenses incurred that are attributable to Executive’s fraud, bad faith, willful misconduct, or gross negligence.
5.Termination of Employment.  (a)  Executive’s employment under this Agreement may be terminated by either party at any time and for any reason; provided, however, that Executive shall be required to give the Company at least sixty (60) days’ advance written notice of any voluntary resignation of Executive’s employment hereunder (other than resignation for Good Reason) (and in such event the Company in its sole discretion may elect to accelerate Executive’s date of termination of employment, it being understood that such termination shall still be treated as a voluntary resignation without Good Reason for purposes of this Agreement).  Notwithstanding the foregoing, Executive’s employment shall terminate automatically upon Executive’s death.  
(b)    Following any termination of Executive’s employment under this Agreement, except as provided under Sections 5(c), 5(d), and 5(e), the obligations of the Company to pay or provide Executive with compensation and benefits under Section 4 shall cease, and the Company shall have no further obligations to provide compensation or benefits to Executive hereunder, except (i) for payment of any accrued but unpaid Base Salary and any accrued but unused vacation and for payment of any unreimbursed business expenses under Section 4(e), in each case accrued or incurred through the date of termination of employment, payable as soon as practicable and in all events within thirty (30) days following the date of termination of employment, (ii) as explicitly set forth in any other benefit plans, programs, or arrangements applicable to terminated employees in which Executive participates (including, without limitation, equity award agreements), other than severance plans or policies (including severance benefits following a Change in Control), and (iii) as otherwise expressly required by applicable law.  For the avoidance of doubt, except as otherwise provided below, any Unpaid 
     5

Annual Bonus (as defined below) is forfeited if Executive’s employment is terminated for any reason.  
(c)    If Executive’s employment under this Agreement is terminated (i) by the Company without Cause (other than due to death or Disability), (ii) by Executive for Good Reason, or (iii) due to expiration of the Term on the Expiration Date as a result of the Company delivering a notice of non-renewal as contemplated by Section 1, in addition to the payments and benefits specified in Section 5(b), Executive shall be entitled to receive: (i) severance pay in an aggregate amount (the “Severance Pay”) equal to, two times (2x) the sum of (A) Base Salary plus (B) Target Bonus; (ii) a prorated Annual Bonus in respect of the fiscal year of termination equal to the product of (x) the amount of Annual Bonus that would have been payable to Executive had Executive’s employment not so terminated based on actual performance measured through the fiscal year of termination, and (y) a fraction, the numerator of which is the number of days elapsed in the Company’s fiscal year in which the termination occurs through such termination and the denominator of which is the number of days in such fiscal year (the “Prorated Bonus”); (iii) any accrued but unpaid Annual Bonus in respect of the fiscal year prior to the fiscal year of termination (the “Unpaid Annual Bonus”); and (iv) continued health insurance benefits under the terms of the applicable Company benefit plans for twenty-four (24) months, subject to Executive’s payment of the cost of such benefits to the same extent that active employees of the Company are required to pay for such benefits from time to time; provided, however, that, such continuation coverage shall end earlier upon Executive’s becoming eligible for comparable coverage under another employer’s benefit plans; and provided, further, that, to the extent that the provision of such continuation coverage is not permitted under the terms of the Company benefit plans or would result in an adverse tax consequence to the Company, the Company may alternatively provide Executive with a monthly cash payment in an amount equal to the applicable COBRA premium that Executive would otherwise be required to pay to obtain COBRA continuation coverage for such benefits for twenty-four (24) months (assuming that COBRA continuation coverage were available for such period) (minus the cost of such benefits to the same extent that active employees of the Company are required to pay for such benefits from time to time) (the “Healthcare Severance Benefits”), commencing as provided in Section 23(c).  The Severance Pay shall be paid in equal installments during the twenty-four (24)-month period following Executive’s termination in accordance with the Company’s regular payroll practices, but no less frequently than monthly, and commencing as provided in Section 23(c) below.  The Unpaid Annual Bonus shall be paid on the date bonuses are paid to other executives during the fiscal year of Executive’s termination and the Prorated Bonus shall be paid on the date bonuses are paid to other executives of the Company in the year following the fiscal year of Executive’s termination.  
(d)    Notwithstanding anything herein to the contrary, if at any time within eighteen (18) months following a Change in Control, Executive’s employment under this Agreement is terminated (i) by the Company without Cause (other than due to death or Disability), (ii) by Executive for Good Reason, or (iii) due to expiration of the Term on the Expiration Date as a result of the Company delivering a notice of non-renewal as contemplated by Section 1,  then Executive, in lieu of any of the amounts and benefits described in Section 5(c) and in addition to the payments and benefits specified in Section 5(b), shall be entitled to receive (i) the Unpaid Annual Bonus, (ii) 2.99 times the sum of (A)  Base Salary plus (B) Target Bonus (the “CIC Severance Pay”), (iii) the product of (x) the Target Bonus, and (y) a fraction, the numerator of which is the number of days elapsed in the Company’s fiscal year in which the termination occurs through such termination and the denominator of which is the number of days in such fiscal year (the “Prorated CIC Bonus”), and (iv) the Healthcare Severance Benefits for twenty-four (24) months (as described above and commencing as provided in Section 23(c)).  The CIC Severance Pay and the Prorated CIC Bonus shall be paid in cash in a lump sum on the first payroll following the satisfaction of the Release Condition, subject to Section 23(c); provided, however, if the Change in Control does not constitute a “change in the ownership or 
     6

effective control of the corporation, or in the ownership of a substantial portion of the assets of the corporation” within the meaning of Section 409A(a)(2)(A)(v) of the Internal Revenue Code of 1986, as amended (the “Code”), the portion of the CIC Severance Pay that is not in excess of the Severance Pay that would have been payable upon such termination if Section 5(c) applied shall be paid to Executive in equal monthly installments during the twenty-four (24)-month period following Executive’s termination in accordance with the Company’s regular payroll practices, but no less frequently than monthly, and commencing as provided in Section 23(c) below, and the portion of the CIC Severance Pay in excess of such amount shall be paid to Executive in a lump sum sixty (60) days after the consummation of the Change in Control.  The Unpaid Annual Bonus shall be paid on the date bonuses are paid to other executives during the fiscal year of Executive’s termination.
(e)    If Executive’s employment under this Agreement is terminated due to death or Disability, in addition to the payments and benefits specified in Section 5(b), Executive shall be entitled to receive (i) the Prorated Bonus, paid on the date bonuses are paid to other executives of the Company in the year following the fiscal year of Executive’s termination, and (ii) the Unpaid Annual Bonus, paid on the date bonuses are paid to other executives of the Company in the fiscal year of Executive’s termination.
(f)    Executive’s entitlement to the payments and benefits set forth in Sections 5(c) and 5(d) shall be conditioned upon Executive’s having provided an irrevocable waiver and release of claims in favor of the Company, its Affiliates, their respective predecessors and successors, and all of the respective current or former directors, officers, employees, shareholders, partners, members, agents, or representatives of any of the foregoing (collectively, the “Released Parties”), substantially in the form attached hereto as Exhibit B (the “Release”), that has become effective in accordance with its terms within sixty (60) days following Executive’s termination of employment (the “Release Condition”), and Executive’s continued compliance with Sections 6 and 7 hereof.
(g)    Upon termination of Executive’s employment for any reason, and regardless of whether Executive continues as a consultant to the Company, upon the Company’s request Executive agrees to resign, as of the date of such termination of employment or such other date requested, from the Board and any committees thereof, and, if applicable, from the board of directors (and any committees thereof) of any Affiliate of the Company to the extent Executive is then serving thereon.  The Company’s obligations to make the payments provided for in this Agreement are subject to set-off for any undisputed amounts owed by Executive, to the extent permitted by Section 409A (as defined below) and any Company clawback policy.
(h)The payment of any amounts accrued under any benefit plan, program, or arrangement in which Executive participates shall be subject to the terms of the applicable plan, program, or arrangement, and any elections Executive has made thereunder.  
(i)Following any termination of Executive’s employment, Executive shall have no obligation to seek other employment or take any other action by way of mitigation of the amounts payable to Executive under any of the provisions of this Agreement.  There shall be no offset against amounts due Executive under this Agreement on account of any remuneration attributable to later employment, consultancy, or other remunerative activity of Executive.
6.Confidential Information.  
(a)    Executive acknowledges that the Company and its Affiliates continually develop Confidential Information (as defined below), that Executive may develop Confidential Information for the Company or its Affiliates and that Executive may learn of 
     7

Confidential Information during the course of Executive’s employment.  Executive will comply with the policies and procedures of the Company and its Affiliates for protecting Confidential Information and shall not disclose to any Person or use, other than as required by applicable law or for the proper performance of Executive’s duties and responsibilities to the Company and its Affiliates, any Confidential Information obtained by Executive incident to Executive’s employment or other association with the Company or any of its Affiliates.  Executive understands that this restriction shall continue to apply after Executive’s employment terminates, regardless of the reason for such termination.
(b)    All documents, records, tapes, and other media of every kind and description relating to the business, present or otherwise, of the Company or its Affiliates and any copies, in whole or in part, thereof (the “Documents”), whether or not prepared by Executive, shall be the sole and exclusive property of the Company and its Affiliates.  Executive shall safeguard all Documents and shall surrender to the Company at the time Executive’s employment terminates, or at such earlier time or times as the Company may specify, all Documents then in Executive’s possession or control.  Executive shall immediately return such Documents and other property to the Company upon the termination of Executive’s employment and, in any event, at the Company’s request.  Executive further agrees that any property situated on the premises of, and owned by, the Company or its Affiliates, including disks and other storage media, filing cabinets, or other work areas, is subject to inspection by the Company’s personnel at any time with or without notice.  
(c)    Executive understands that, notwithstanding anything to the contrary contained herein, no provision of this Agreement will be interpreted so as to impede Executive (or any other individual) from (i) making any disclosure of relevant and necessary information or documents in any action, investigation, or proceeding relating to this Agreement, or as required by law or legal process, including with respect to possible violations of law, (ii) participating, cooperating, or testifying in any action, investigation, or proceeding with, or providing information to, any governmental agency, legislative body or any self-regulatory organization, including, but not limited to, the Department of Justice, the Securities and Exchange Commission, the Congress, and any agency Inspector General, (iii) accepting any U.S. Securities and Exchange Commission Awards, or (iv) making other disclosures under the whistleblower provisions of federal law or regulation. In addition, nothing in this Agreement or any other agreement or Company policy prohibits or restricts Executive from initiating communications with, or responding to any inquiry from, any administrative, governmental, regulatory or supervisory authority regarding any good faith concerns about possible violations of law or regulation. Executive does not need the prior authorization of the Company to make any such reports or disclosures and Executive will not be required to notify the Company that such reports or disclosures have been made.
(d)    “Confidential Information” means any and all information of the Company and its Affiliates that is not generally known by others with whom they compete or do business, or with whom any of them plans to compete or do business and any and all information, publicly known in whole or in part or not, which, if disclosed by the Company or its Affiliates would assist in competition against them.  Confidential Information includes, without limitation, such information relating to (i) the development, research, testing, manufacturing, marketing and financial activities of the Company and its Affiliates, (ii) all products planned, researched, developed, tested, manufactured, sold, licensed, leased or otherwise distributed or put into use by the Company and its Affiliates, together with all services provided or planned by the Company or any of its Affiliates, during Executive’s employment, (iii) the costs, sources of supply, financial performance and strategic plans of the Company and its Affiliates, (iv) the identity and special needs of the customers of the Company and its Affiliates and (v) the people and organizations with whom the Company and its Affiliates have business relationships and those relationships.  Confidential Information also includes any information that the Company or 
     8

any of its Affiliates have received, or may receive hereafter, belonging to customers or others with any understanding, express or implied, that the information would not be disclosed.
7.Restricted Activities.  Executive agrees that some restrictions on Executive’s activities during and after Executive’s employment are necessary to protect the goodwill, Confidential Information, and other legitimate interests of the Company and its Affiliates.  Following the Effective Date, the Company will provide Executive with access to and knowledge of Confidential Information and trade secrets and will place Executive in a position of trust and confidence with the Company, and Executive will benefit from the Company’s goodwill.  The restrictive covenants below are necessary to protect the Company’s legitimate business interests in its Confidential Information, trade secrets and goodwill. Executive further understands and acknowledges that the Company’s ability to reserve these for the exclusive knowledge and use of the Company is of great competitive importance and commercial value to the Company and that the Company would be irreparably harmed if Executive violates the restrictive covenants below.  In recognition of the consideration provided to Executive as well as the imparting to Executive of Confidential Information, including trade secrets, and for other good and valuable consideration, Executive hereby agrees as follows:
(a)    While Executive is employed by the Company and for twenty-four (24) months after Executive’s employment terminates for any reason, whether before or after the Expiration Date (in the aggregate, the “Non-Competition Period”), Executive shall not, directly or indirectly, whether as owner, partner, investor (other than a passive investor of less than 5% in a publicly traded company), consultant, agent, employee, co-venturer, or otherwise, (i) compete with the business of the Company or any of its subsidiaries in any location where the Company or its subsidiaries conducts business (a “Competitive Business”) or (ii) undertake any planning for any Competitive Business.  With respect to the portion of the Non-Competition Period that follows Executive’s termination of employment, the determination of whether a business is a Competitive Business shall be made based on the scope and location of the businesses conducted or planned to be conducted by the Company and its subsidiaries as of the date of such termination.
(b)    Executive agrees that, during Executive’s employment with the Company, Executive will not undertake any outside activity, whether or not competitive with the business of the Company or its Affiliates, that would reasonably give rise to a conflict of interest or otherwise interfere with Executive’s duties and obligations to the Company or any of its Affiliates.
(c)    Executive further agrees that, during the Non-Competition Period, Executive will not solicit, hire, or attempt to solicit or hire any employee of the Company or any of its Affiliates (or any individual who was employed by the Company or any of its Affiliates during the one (1)-year period prior to Executive’s termination), assist in such hiring by any Person, encourage any such employee to terminate his or her relationship with the Company or any of its Affiliates, or solicit or encourage any customer, client, or vendor of the Company or any of its Affiliates to terminate or diminish its relationship with them, or, in the case of a customer, to conduct with any Person any business or activity which such customer conducts with the Company or any of its Affiliates.  
(d)    Executive shall not, whether in writing or orally, malign, denigrate, or disparage the Company or its Affiliates, or their respective predecessors and successors, or any of the current or former directors, officers, employees, shareholders, partners, members, agents, or representatives of any of the foregoing, with respect to any of their respective past or present activities, or otherwise publish (whether in writing or orally) statements that tend to portray any of the aforementioned parties in an unfavorable light.  The Company shall direct its directors and officers not to, whether in writing or orally, malign, denigrate, or disparage 
     9

Executive with respect to any of Executive’s past or present activities, or otherwise publish (whether in writing or orally) statements that are intended to portray Executive in an unfavorable light.  
(e)    Executive’s and the Company’s obligations under this Section 7, as applicable, shall continue beyond the termination of Executive’s employment with the Company.
8.Notification Requirement.  Through and up to the conclusion of the Non-Competition Period, Executive shall give notice to the Company of each new business activity he plans to undertake, at least seven (7) days prior to beginning any such activity.  Such notice shall state the name and address of the Person for whom such activity is undertaken and the nature of Executive’s business relationship(s) and position(s) with such Person.  
9.Intellectual Property Rights.  (a)  Executive agrees that the results and proceeds of Executive’s services for the Company (including, but not limited to, any trade secrets, products, services, processes, know-how, designs, developments, innovations, analyses, drawings, reports, techniques, formulas, methods, developmental or experimental work, improvements, discoveries, inventions, ideas, source and object codes, programs, writing and other works of authorship) resulting from services performed while an employee of the Company and any works in progress, whether or not patentable or registrable under copyright or similar statutes, that were made, developed, conceived, or reduced to practice or learned by Executive, either alone or jointly with others (collectively, “Inventions”), shall be works-made-for-hire and the Company shall be deemed the sole owner throughout the universe of any and all trade secret, patent, copyright, and other intellectual property rights (collectively, “Proprietary Rights”) of whatsoever nature therein, whether or not now or hereafter known, existing, contemplated, recognized, or developed, with the right to use the same in perpetuity in any manner the Company determines in its sole discretion, without any further payment to Executive whatsoever.  If, for any reason, any of such results and proceeds shall not legally be a work-made-for-hire and/or there are any Proprietary Rights which do not accrue to the Company under the immediately preceding sentence, then Executive hereby irrevocably assigns and agrees to assign any and all of Executive’s right, title, and interest thereto, including any and all Proprietary Rights of whatsoever nature therein, whether or not now or hereafter known, existing, contemplated, recognized, or developed, to the Company, and the Company shall have the right to use the same in perpetuity throughout the universe in any manner determined by the Company without any further payment to Executive whatsoever.  As to any Invention that Executive is required to assign, Executive shall promptly and fully disclose to the Company all information known to Executive concerning such Invention.
(b)    Executive agrees that, from time to time, as may be requested by the Company and at the Company’s sole cost and expense, Executive shall do any and all things that the Company may reasonably deem useful or desirable to establish or document the Company’s exclusive ownership throughout the United States of America or any other country of any and all Proprietary Rights in any such Inventions, including the execution of appropriate copyright and patent applications or assignments.  To the extent that Executive has any Proprietary Rights in the Inventions that cannot be assigned in the manner described above, Executive unconditionally and irrevocably waives the enforcement of such Proprietary Rights.  This Section 9(b) is subject to and shall not be deemed to limit, restrict, or constitute any waiver by the Company of any Proprietary Rights of ownership to which the Company may be entitled by operation of law by virtue of the Company’s being Executive’s employer.  Executive shall execute, verify, and deliver such documents and perform such other acts (including appearances as a witness) as the Company may reasonably request for use in applying for, obtaining, perfecting, evidencing, sustaining, and enforcing such Proprietary Rights and the assignment thereof.  In addition, Executive shall execute, verify, and deliver assignments of such Proprietary 
     10

Rights to the Company or its designees.  Executive’s obligations under this Section 9 shall continue beyond the termination of Executive’s employment with the Company.
(c)    18 U.S.C. § 1833(b) provides: "An individual shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that—(i) is made—(A) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney; and (B) solely for the purpose of reporting or investigating a suspected violation of law; or (ii) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal." Nothing in this Agreement is intended to conflict with 18 U.S.C. § 1833(b) or create liability for disclosures of trade secrets that are expressly allowed by 18 U.S.C. § 1833(b). Accordingly, the parties to this Agreement have the right to disclose in confidence trade secrets to federal, state, and local government officials, or to an attorney, for the sole purpose of reporting or investigating a suspected violation of law. The parties also have the right to disclose trade secrets in a document filed in a lawsuit or other proceeding, but only if the filing is made under seal and protected from public disclosure.
(d)    Executive hereby waives and quitclaims to the Company any and all claims, of any nature whatsoever, that Executive now or may hereafter have for infringement of any Proprietary Rights assigned hereunder to the Company.
10.Remedies and Injunctive Relief.  Executive acknowledges that a violation by Executive of any of the covenants contained in Sections 6, 7, 8, or 9 would cause irreparable damage to the Company in an amount that would be material but not readily ascertainable, and that any remedy at law (including the payment of damages) would be inadequate.  Accordingly, Executive agrees that, notwithstanding any provision of this Agreement to the contrary, the Company shall be entitled (without the necessity of showing economic loss or other actual damage) to injunctive relief (including temporary restraining orders, preliminary injunctions, and permanent injunctions) in any court of competent jurisdiction for any actual or threatened breach of any of the covenants set forth in Sections 6, 7, 8, or 9 in addition to any other legal or equitable remedies it may have.  The preceding sentence shall not be construed as a waiver of the rights that the Company may have for damages under this Agreement or otherwise, and all of the Company’s rights shall be unrestricted.
11.Representations; Advice of Counsel. (a)  Executive represents, warrants, and covenants that as of the date hereof:  (i) Executive has the full right, authority, and capacity to enter into this Agreement and perform Executive’s obligations hereunder, (ii) Executive is not bound by any agreement that conflicts with or prevents or restricts the full performance of Executive’s duties and obligations to the Company hereunder during or after the Term, and (iii) the execution and delivery of this Agreement shall not result in any breach or violation of, or a default under, any existing obligation, commitment, or agreement to which Executive is subject.  
(b)    Prior to execution of this Agreement, Executive was advised by the Company of Executive’s right to seek independent advice from an attorney of Executive’s own selection regarding this Agreement.  Executive acknowledges that Executive has entered into this Agreement knowingly and voluntarily and with full knowledge and understanding of the provisions of this Agreement after being given the opportunity to consult with counsel.  Executive further represents that in entering into this Agreement, Executive is not relying on any statements or representations made by any of the Company’s directors, officers, employees, or agents that are not expressly set forth herein, and that Executive is relying only upon Executive’s own judgment and any advice provided by Executive’s attorney.
(c)    The Company represents, warrants, and covenants that as of the date hereof:  (i) the Company has the full right, authority, and capacity to enter into this Agreement and perform the Company’s obligations hereunder, (ii) the Company is not bound by 
     11

any agreement that conflicts with or prevents or restricts the full performance of the Company’s obligations to Executive hereunder during or after the Term, and (iii) the execution and delivery of this Agreement shall not result in any breach or violation of, or a default under, any existing obligation, commitment, or agreement to which the Company is subject.
12.Cooperation.  Executive agrees that, upon reasonable notice and without the necessity of the Company’s obtaining a subpoena or court order, Executive shall provide reasonable cooperation in connection with any suit, action, or proceeding (or any appeal from any suit, action, or proceeding), and any investigation or defense of any claims asserted against the Company or its Affiliates, that relates to events occurring during Executive’s employment with the Company and its Affiliates as to which Executive may have relevant information (including but not limited to furnishing relevant information and materials to the Company or its designee and providing testimony at depositions and at trial); provided that with respect to such cooperation occurring following termination of employment, the Company shall reimburse Executive for expenses reasonably incurred in connection therewith.
13.Withholding.  The Company may deduct and withhold from any amounts payable under this Agreement such federal, state, local, non-U.S., and other taxes as are required to be withheld pursuant to any applicable law or regulation.
14.Assignment.  Neither the Company nor Executive may make any assignment of this Agreement or any interest herein, by operation of law or otherwise, without the prior written consent of the other party; provided, that the Company may assign its rights under this Agreement without the consent of Executive to a successor to substantially all of the business of the Company in the event that the Company shall effect a reorganization, consolidate with or merge into any other corporation, partnership, organization, or other entity, or transfer all or substantially all of its properties or assets to any other corporation, partnership, organization, or other entity.  This Agreement shall inure to the benefit of and be binding upon the Company and Executive, and their respective successors, executors, administrators, heirs, and permitted assigns.
15.Governing Law; No Construction Against Drafter.  This Agreement shall be deemed made in the State of Delaware, and the validity, interpretation, construction, and performance of this Agreement in all respects shall be governed by the laws of the State of Delaware without regard to its principles of conflicts of law.  No provision of this Agreement or any related document will be construed against or interpreted to the disadvantage of any party hereto by any court or other governmental or judicial authority by reason of such party’s having or being deemed to have structured or drafted such provision.
16.Consent to Jurisdiction; Waiver of Jury Trial.  (a)  Except as otherwise specifically provided herein, Executive and the Company each hereby irrevocably submit to the exclusive jurisdiction of the federal courts located within the State of Delaware (or, if subject matter jurisdiction in such courts are not available, in any state court located within the State of Delaware) over any dispute arising out of or relating to this Agreement.  Except as otherwise specifically provided in this Agreement, the parties undertake not to commence any suit, action or proceeding arising out of or relating to this Agreement in a forum other than a forum described in this Section 16(a); provided, however, that nothing herein shall preclude either party from bringing any suit, action, or proceeding in any other court for the purpose of enforcing the provisions of this Section 16 or enforcing any judgment obtained by either party.
(b)    The agreement of the parties to the forum described in Section 16(a) is independent of the law that may be applied in any suit, action, or proceeding, and the parties agree to such forum even if such forum may under applicable law choose to apply non-forum law.  The parties hereby waive, to the fullest extent permitted by applicable law, any 
     12

objection which they now or hereafter have to personal jurisdiction or to the laying of venue of any such suit, action, or proceeding brought in an applicable court described in Section 16(a), and the parties agree that they shall not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such court.  The parties agree that, to the fullest extent permitted by applicable law, a final and non-appealable judgment in any suit, action, or proceeding brought in any applicable court described in Section 16(a) shall be conclusive and binding upon the parties and may be enforced in any other jurisdiction.
(c)    The parties hereto irrevocably consent to the service of any and all process in any suit, action, or proceeding arising out of or relating to this Agreement by the mailing of copies of such process to such party at such party’s address specified in Section 20.
(d)    Each party hereto hereby waives, to the fullest extent permitted by applicable law, any right it may have to a trial by jury in respect of any suit, action, or proceeding arising out of or relating to this Agreement.  Each party hereto (i) certifies that no representative, agent, or attorney of any other party has represented, expressly or otherwise, that such party would not, in the event of any action, suit, or proceeding, seek to enforce the foregoing waiver, and (ii) acknowledges that it and the other party hereto has been induced to enter into this Agreement by, among other things, the mutual waiver and certifications in this Section 16(d).
(e)    Each party shall bear his or her or its own costs and expenses (including reasonable attorneys’ fees and expenses) incurred in connection with any dispute arising out of or relating to this Agreement.  
17.Amendment; No Waiver; Severability.  (a)  No provisions of this Agreement may be amended, modified, waived, or discharged except by a written document signed by Executive and a duly authorized officer of the Company (other than Executive).  The failure of a party to insist upon strict adherence to any term of this Agreement on any occasion shall not be considered a waiver of such party’s rights or deprive such party of the right thereafter to insist upon strict adherence to that term or any other term of this Agreement.  No failure or delay by either party in exercising any right or power hereunder will operate as a waiver thereof, nor will any single or partial exercise of any such right or power, or any abandonment of any steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power.
(b)    If any term or provision of this Agreement is invalid, illegal, or incapable of being enforced by any applicable law or public policy, all other conditions and provisions of this Agreement shall nonetheless remain in full force and effect so long as the economic and legal substance of the transactions contemplated by this Agreement is not affected in any manner materially adverse to any party; provided that in the event that any court of competent jurisdiction shall finally hold in a non-appealable judicial determination that any provision of Sections 6 through 10 (whether in whole or in part) is void or constitutes an unreasonable restriction against Executive, such provision shall not be rendered void but shall be deemed modified to the minimum extent necessary to make such provision enforceable for the longest duration and the greatest scope as such court may determine constitutes a reasonable restriction under the circumstances.  Subject to the foregoing, upon such determination that any term or other provision is invalid, illegal, or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated hereby be consummated as originally contemplated to the fullest extent possible.
18.Entire Agreement.  This Agreement constitutes the entire agreement and understanding between the Company and Executive with respect to the subject matter hereof and 
     13

supersedes all prior agreements and understandings (whether written or oral), between Executive and the Company, relating to such subject matter.  None of the parties shall be liable or bound to any other party in any manner by any representations and warranties or covenants relating to such subject matter except as specifically set forth herein.
19.Survival.  The rights and obligations of the parties under the provisions of this Agreement shall survive, and remain binding and enforceable, notwithstanding the expiration of the Term, the termination of this Agreement, the termination of Executive’s employment hereunder or any settlement of the financial rights and obligations arising from Executive’s employment hereunder, to the extent necessary to preserve the intended benefits of such provisions.  
20.Notices.  All notices or other communications required or permitted to be given hereunder shall be in writing and shall be delivered by hand or sent by facsimile or sent, postage prepaid, by registered, certified, or express mail or overnight courier service and shall be deemed given when so delivered by hand or facsimile, or if mailed, three days after mailing (one (1) business day in the case of express mail or overnight courier service) to the parties at the following addresses or facsimiles (or at such other address for a party as shall be specified by like notice):
If to the Company:    Vistra Corp.
Attn: Corporate Secretary 
6555 Sierra Drive
Irving, TX 75039 

If to Executive:    At the most recent address on file in the Company’s records.

Notices delivered by facsimile shall have the same legal effect as if such notice had been delivered in person.
21.Headings and References.  The headings of this Agreement are inserted for convenience only, and neither constitute a part of this Agreement nor affect in any way the meaning or interpretation of this Agreement.  When a reference in this Agreement is made to a Section, such reference shall be to a Section of this Agreement unless otherwise indicated.
22.Counterparts.  This Agreement may be executed in one or more counterparts (including via electronic image scan (.pdf)), each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument and shall become effective when one or more counterparts have been signed by each of the parties and delivered to the other parties.
23.Section 409A.  (a)  For purposes of this Agreement, “Section 409A” means Section 409A of the Code, and the Treasury Regulations promulgated thereunder (and such other Treasury or Internal Revenue Service guidance) as in effect from time to time.  The parties intend that any amounts payable hereunder that could constitute “deferred compensation” within the meaning of Section 409A will be compliant with Section 409A or exempt from Section 409A.  
(b)    Notwithstanding anything in this Agreement to the contrary, the following special rule shall apply, if and to the extent required by Section 409A, in the event that (i) Executive is deemed to be a “specified employee” within the meaning of Code Section 409A(a)(2)(B)(i) (as determined in accordance with the methodology established by the Company as in effect on the date of Executive’s “separation from service” (within the meaning 
     14

of Treasury Regulations § 1.409A-1(h)), (ii) amounts or benefits under this Agreement or any other program, plan, or arrangement of the Company or a controlled group affiliate thereof are due or payable on account of separation from service, and (iii) Executive is employed by a public company or a controlled group affiliate thereof:  payments hereunder that are “deferred compensation” subject to Section 409A that would be made to Executive prior to the date that is six (6) months after the date of Executive’s separation from service shall be made within ten (10) business days after such six (6)-month date or, if earlier, ten (10) days following the date of Executive’s death; following any applicable delay, all such delayed payments, without interest will be paid in a single lump sum on the earliest permissible payment date.  
(c)    Except to the extent required to be delayed pursuant to Section 23(b), any payment or benefit due or payable on account of Executive’s separation from service to which this Section 23(c) applies shall be paid or commence, as applicable, upon the first scheduled payroll date immediately after the date the Release Condition is satisfied (the “Release Effective Date”); provided that, to the extent that such payment or benefit represents a “deferral of compensation” within the meaning of Section 409A and the sixty (60) day period following Executive’s separation from service spans two (2) taxable years, payment shall not be made or commence prior to January 1 of the second taxable year.  The first such cash payment shall include payment of all amounts that otherwise would have been due prior to the Release Effective Date under the terms of this Agreement applied as though such payments commenced immediately upon Executive’s termination of employment, and any payments made thereafter shall continue as provided herein.  The delayed benefits shall in any event expire at the time such benefits would have expired had such benefits commenced immediately following Executive’s termination of employment.
(d)    Each payment made under this Agreement (including each separate installment payment in the case of a series of installment payments) shall be deemed to be a separate payment for purposes of Section 409A.  Amounts payable under this Agreement shall be deemed not to be a “deferral of compensation” subject to Section 409A to the extent provided in the exceptions in Treasury Regulations §§ 1.409A-1(b)(4) (“short-term deferrals”) and (b)(9) (“separation pay plans,” including the exception under subparagraph (iii)) and other applicable provisions of Section 409A, and shall be paid under any such exception to the maximum extent permitted.  For purposes of this Agreement, with respect to payments of any amounts that are considered to be “deferred compensation” subject to Section 409A, references to “termination of employment,” “termination,” or words and phrases of similar import, shall be deemed to refer to Executive’s “separation from service” as defined in Section 409A, and shall be interpreted and applied in a manner that is consistent with the requirements of Section 409A.  In no event may Executive, directly or indirectly, designate the calendar year of any payment under this Agreement.  
(e)    Notwithstanding anything to the contrary in this Agreement, any payment or benefit under this Agreement or otherwise that is eligible for exemption from Section 409A pursuant to Treasury Regulation § 1.409A-1(b)(9)(v)(A) or (C) (relating to certain reimbursements and in-kind benefits) shall be paid or provided to Executive only to the extent that the expenses are not incurred, or the benefits are not provided, beyond the last day of the second calendar year following the calendar year in which Executive’s “separation from service” occurs; and provided that such expenses are reimbursed no later than the last day of the second calendar year following the calendar year in which Executive’s “separation from service” occurs.  To the extent that any indemnification payment, expense reimbursement, or provision of any in-kind benefit is determined to be subject to Section 409A (and not exempt pursuant to the prior sentence or otherwise), the amount of any such indemnification payment or expenses eligible for reimbursement, or the provision of any in-kind benefit, in one (1) calendar year shall not affect the indemnification payment or provision of in-kind benefits or expenses eligible for reimbursement in any other calendar year (except for any lifetime or other aggregate limitation 
     15

applicable to medical expenses to the extent permitted by Section 409A), such indemnification, reimbursement, or in-kind benefits shall be provided for the period set forth in this Agreement, or if no such period is set forth, during Executive’s lifetime, in no event shall any indemnification payment or expenses be reimbursed after the last day of the calendar year following the calendar year in which Executive incurred such indemnification payment or expenses, and in no event shall any right to indemnification payment or reimbursement or the provision of any in-kind benefit be subject to liquidation or exchange for another benefit.
     16

IN WITNESS WHEREOF, this Agreement has been duly executed by the parties as of the date first written above.

Vistra Corp. and Luminant Energy Company LLC

By: /s/ Carrie Lee Kirby                
Name:  Carrie Lee Kirby
Title: Executive Vice President and Chief Administrative Officer

STEPHEN J. MUSCATO

/s/ Stephen J. Muscato                    

Exhibit A

						
	OIP:	Equity awards to be subject to the terms of the Company’s Omnibus Incentive Plan.
	Annual Equity Awards:	Executive will be granted annual equity awards in an amount determined by the Board.  Such awards may be in the form of options, restricted stock units, performance shares, or any other form as approved by the Board.
	Involuntary Termination Without Cause / Resignation for Good Reason / Non-Renewal of Term by the Company:	Subject to delivery (and non-revocation) of the Release and continued compliance with Sections 6 and 7 of this Agreement, accelerated vesting of the portion of Executive’s outstanding equity awards that would have vested in the 12 months following termination had Executive remained employed (fully vested options to remain exercisable for 90 days following termination or, if Executive is subject Section 16 of the Exchange Act as of such Termination, 180 days from the date of such termination (or until the option’s regular expiration date, if shorter)).
	Termination with Cause / Resignation Without Good Reason / Non-Renewal of the Term by Executive	All options and other outstanding awards (unvested and vested) are forfeited upon a termination for Cause.  On any other termination, Executive will retain all vested awards (forfeits unvested), and vested options remain exercisable for 30 days following termination or, if Executive is subject Section 16 of the Exchange Act as of such Termination, 180 days from the date of such termination (or until the option’s regular expiration date, if shorter).
	Death / Disability	Accelerated vesting of the portion of Executive’s equity awards that would have vested in the 12 months following termination had he remained employed (fully vested options to remain exercisable for one year following termination (or until the option’s regular expiration date, if shorter)).
	Involuntary Termination Without Cause / Resignation for Good Reason / Non-Renewal of Term by the Company Following a Change in Control:	All equity awards that were outstanding at the time of the Change in Control will vest upon such termination.

Exhibit B
Release of Claims
As used in this Release of Claims (this “Release”), the term “claims” will include all claims, covenants, warranties, promises, undertakings, actions, suits, causes of action, proceedings, obligations, debts, accounts, attorneys’ fees, judgments, losses, and liabilities, of whatsoever kind or nature, in law, in equity, or otherwise.  Capitalized terms used but not defined in this Release will have the meanings given to them in the employment agreement dated May __, 2022, between Vistra Corp., Luminant Energy Company LLC (together, the “Company”) and Stephen J. Muscato (my “Agreement”).
For and in consideration of the severance payments and benefits, and other good and valuable consideration, I, for and on behalf of myself and my executors, heirs, administrators, representatives, and assigns, hereby agree to release and forever discharge the Company and each of its direct and indirect parent and subsidiary entities, and all of their respective predecessors, successors, and past, current, and future parent entities, affiliates, subsidiary entities, investors, directors, shareholders, members, officers, general or limited partners, employees, attorneys, agents, and representatives, and the employee benefit plans in which I am or have been a participant by virtue of my employment with or service to the Company (collectively, the “Company Releasees”), from any and all claims that I have or may have had against the Company Releasees based on any events or circumstances arising or occurring on or prior to the date hereof and arising directly or indirectly out of, relating to, or in any other way involving in any manner whatsoever my employment by or service to the Company or the termination thereof, including without limitation any and all claims arising under federal, state, or local laws relating to employment, including without limitation claims of wrongful discharge, breach of express or implied contract, fraud, misrepresentation, defamation, intentional infliction of emotional distress, whistleblowing, or liability in tort, and claims of any kind that may be brought in any court or administrative agency, and any related claims for attorneys’ fees and costs, including, without limitation, claims under Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. Section 2000, et seq.; the Americans with Disabilities Act, as amended, 42 U.S.C. § 12101 et seq.; the Rehabilitation Act of 1973, as amended, 29 U.S.C. § 701 et seq.; the Civil Rights Act of 1866, and the Civil Rights Act of 1991; 42 U.S.C. Section 1981, et seq.; the Age Discrimination in Employment Act, as amended, 29 U.S.C. Section 621, et seq. (the “ADEA”); the Equal Pay Act, as amended, 29 U.S.C. Section 206(d); regulations of the Office of Federal Contract Compliance, 41 C.F.R. Section 60, et seq.; the Family and Medical Leave Act, as amended, 29 U.S.C. § 2601 et seq.; the Fair Labor Standards Act of 1938, as amended, 29 U.S.C. § 201 et seq.; the Employee Retirement Income Security Act, as amended, 29 U.S.C. § 1001 et seq.; and any similar state or local law.  I agree further that this Release may be pleaded as a full defense to any action, suit, arbitration, or other proceeding covered by the terms hereof that is or may be initiated, prosecuted, or maintained by me or my descendants, dependents, heirs, executors, administrators, or assigns.  By signing this Release, I acknowledge that I intend to waive and release all rights known or unknown that I may have against the Company Releasees under these and any other laws.
I acknowledge and agree that as of the date I execute this Release, I have no knowledge of any facts or circumstances that give rise or could give rise to any claims under any of the laws listed in the preceding paragraph and that I have not filed any claim against any of the Releasees before any local, state, federal, or foreign agency, court, arbitrator, mediator, arbitration or mediation panel, or other body (each individually a “Proceeding”).  I (i) acknowledge that I will not initiate or cause to be initiated on my behalf any Proceeding and will not participate in any Proceeding, in each case, except as required by law or to the extent such Proceeding relates to a claim not waived hereunder; and (ii) waive any right that I may have to benefit in any manner from any relief (whether monetary or otherwise) arising out of any Proceeding, including any Proceeding conducted by the Equal Employment Opportunity Commission (“EEOC”), except in 

each case to the extent such Proceeding relates to a claim not waived hereunder.  Further, I understand that, by executing this Release, I will be limiting the availability of certain remedies that I may have against the Company and limiting also my ability to pursue certain claims against the Company Releasees.
By executing this Release, I specifically release all claims relating to my employment and its termination under ADEA, a federal statute that, among other things, prohibits discrimination on the basis of age in employment and employee benefit plans.
Notwithstanding the generality of the foregoing, I do not release (i) claims to receive my severance payments and benefits in accordance with the terms of the Agreement, (ii) claims with respect to benefits to which I am entitled under the employee benefit and compensation plans of the Company and its affiliates, including any rights to equity, (iii) claims to indemnification, or (iv) claims that cannot be waived by law.  Further, nothing in this Release shall prevent me from (i) initiating or causing to be initiated on my behalf any claim against the Company before any local, state, or federal agency, court, or other body challenging the validity of the waiver of my claims under the ADEA (but no other portion of such waiver); or (ii) initiating or participating in an investigation or proceeding conducted by the EEOC.
I acknowledge that I have been given at least [21]/[45]1 days in which to consider this Release.  I acknowledge further that the Company has advised me to consult with an attorney of my choice before signing this Release, and I have had sufficient time to consider the terms of this Release.  I represent and acknowledge that if I execute this Release before [21]/[45] days have elapsed, I do so knowingly, voluntarily, and upon the advice and with the approval of my legal counsel (if any), and that I voluntarily waive any remaining consideration period.
I understand that after executing this Release, I have the right to revoke it within seven days after its execution.  I understand that this Release will not become effective and enforceable unless the seven-day revocation period passes and I do not revoke the Release in writing.  I understand that this Release may not be revoked after the seven (7)-day revocation period has passed.  I understand also that any revocation of this Release must be made in writing and delivered to the Company at its principal place of business within the seven (7)-day period.
This Release will become effective, irrevocable, and binding on the eighth day after its execution, so long as I have not timely revoked it as set forth above.  I understand and acknowledge that I will not be entitled to the severance payments and benefits unless this Release is effective on or before the date that is sixty (60) days following the date of my termination of employment.
I hereby agree to waive any and all claims to re-employment with the Company or any of its affiliates and affirmatively agree not to seek further employment with the Company or any of its affiliates.
The provisions of this Release will be binding upon my heirs, executors, administrators, legal representatives, and assigns.  If any provision of this Release will be held by any court of competent jurisdiction to be illegal, void, or unenforceable, such provision will be of no force or effect.  The illegality or unenforceability of such provision, however, will have no effect upon and will not impair the enforceability of any other provision of this Release.

1 NTD:  To be selected based on whether applicable termination was “in connection with an exit incentive or other employment termination program” (as such phrase is defined in the Age Discrimination in Employment Act of 1967).

This Release will be governed in accordance with the laws of the State of Delaware, without reference to the principles of conflicts of law.  Any dispute or claim arising out of or relating to this Release or claim of breach hereof will be brought exclusively in the federal and state courts located within Delaware.  By execution of this Release, I am waiving any right to trial by jury in connection with any suit, action, or proceeding under or in connection with this Release.

    
Stephen J. Muscato
    
DATEplth_101.htm

EXHIBIT 10.1
  
 OPTION PURCHASE AGREEMENT
  
 This Option Purchase Agreement (this “Agreement”) is dated as of August 4, 2022, by and between FRANK COWAN, IV, an adult individual, with a mailing address at 3902 N. Grant Street, Westmont, IL 60559 (the “Optionor”), and PLANET 13 HOLDINGS INC., a British Columbia corporation, with a mailing address at 2548 W Desert Inn Road, Las Vegas, Nevada 89109 (the “Optionee”). Capitalized terms used in this Agreement shall have the meanings specified in Section 1.5 of this Agreement.
  
 BACKGROUND
  
 WHEREAS, Planet 13 Illinois, LLC, an Illinois limited liability company (the “Company”), the Optionor and the Optionee are parties to that certain Operating Agreement, dated as of December 31, 2019 (the “Operating Agreement”), setting forth the terms and conditions governing the operation and management of the Company; 
  
 WHEREAS, the Optionor owns 51,000,000 Class A Units (as defined in the Operating Agreement), representing a 51% ownership interest in the Company;
  
 WHEREAS, the Optionee owns 49,000,000 Class A Units, representing a 49% ownership interest in the Company; and
  
 WHEREAS, the Optionor has agreed to grant Optionee an option to purchase all of the Class A Units owned by the Optionor on the terms and subject to the conditions as provided herein.
  
 NOW, THEREFORE, in consideration of the foregoing recitals and the mutual promises, representations, warranties and covenants hereinafter set forth, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the parties hereto agree as follows:
  
 1. Option to Purchase.
  
 1.1 Option. Subject to the terms and conditions hereof, the Optionor hereby grants to the Optionee an irrevocable and exclusive right, privilege and option to purchase (the “Option”) 51,000,000 Class A Units owned by the Optionor (the “Option Units”) for a purchase price determined as follows (the “Purchase Price”):
  
 (a) $866,250 (the “Cash Purchase Price”); and 
  
 (b) 1,063,377 common shares of the Optionee (“P13 Shares”) or, in the event of a Change of Control, a Change of Control Equivalent (in either case, the “Optionee Shares”). 
  
 1.2 Exercise of Option. To exercise the Option, the Optionee must deliver written notice in the form of Exhibit A attached hereto (the “Exercise Notice”) to the Optionor on or before the two (2) year anniversary of the date hereof (the “Exercise Period”) stating that the Option is being exercised. If the Optionee fails to exercise the Option during the Exercise Period, then the Option shall terminate; provided, however, that the parties hereto understand that, as of the date of this Agreement, the Company has been awarded an Illinois Conditional Adult Use Dispensing Organization License (the “Conditional License”) and that ownership of the Conditional License cannot be altered during the conditional phase, and, therefore, the Optionee shall not have the right to deliver the Exercise Notice until the Company obtains an Adult Use Dispensing Organization License (the “Annual Dispensary License”)
  
 	 
	1
	

	 

  
 1.3 Closing. Upon delivery of the Exercise Notice, this Agreement shall constitute an agreement between the Optionor to sell, and the Optionees to purchase, all of the Option Units upon the following terms and conditions:
  
 (a) The Optionor shall fully cooperate with the Optionee to (i) obtain all authorizations, approvals or permits, if any, of any Governmental Authority or regulatory body of the United States or of any state, (ii) make all registrations and filings (including filings with Governmental Authorities) and (iii) take all steps as may be necessary to obtain an approval or waiver from, or to avoid an action or proceeding by, any Governmental Authorities, in each case, that the Optionee believes are required in connection with the lawful issuance and sale of the Option Units pursuant to this Agreement, including, without limitation, regulatory approvals necessary to transfer ownership of, and extend, as applicable, the Annual Dispensary License, including, but not limited to, approval of the Illinois Department of Financial and Professional Regulation (“IDFPR”) (collectively, the “Regulatory Approvals”). The Optionor shall cause the Company to submit all requisite documentation for all Regulatory Approvals within five (5) days of the delivery of the Exercise Notice by the Optionee.
  
 (b) The closing for the purchase by the Optionee of all of the Option Units (the “Closing”) shall be held within ten (10) days after receipt of all of the Regulatory Approvals (as determined by the Optionee with written notice of such determination to be promptly sent to the Optionor), or at such time and place as shall be mutually agreed upon by the Optionor and the Optionee (such date of Closing, the “Closing Date”). 
  
 (c) At the Closing, the Cash Purchase Price shall be paid to the Optionor in immediately available funds to an account designated in writing by the Optionor, and the Optionee Shares shall be issued to the Optionor (subject to Section 1.4 hereof). The Option shall not be deemed fully exercised unless and until payment of the Purchase Price shall have been delivered to the Optionor in the manner provided herein.
  
 (d) At the Closing, the Optionor shall convey, transfer and assign to the Optionee good and marketable title to the Option Units, free and clear of any lien, security interest, restriction, claim or encumbrance, by delivering to the Optionee a duly executed Assignment of Membership Interests, in form and substance as attached hereto as Exhibit B, as well as any such instruments and documents as the Optionee believes may be reasonably necessary to effectuate the consummation of the transfer of the Option Units in form and substance reasonably satisfactory to the Optionee.
  
 (e) Upon consummation of the Closing, the Optionor shall have no liability to the Company, to the Optionee, or to the creditors of the Company on account of any deficit balance in the Optionor’s capital account established and maintained by the Company for the Optinor (“Capital Account”), nor shall the Optionor have any obligation to restore a deficit balance in his Capital Account at the Closing.
  
 	 
	2
	

	 

  
 1.4 Securities Covenants. In the event any portion of the Purchase Price is in the form of P13 Shares or other shares of capital stock issued as part of a Change of Control Equivalent, such shares will be subject to the following:
  
 (a) the Optionee Shares shall be issued subject to such lock-up restrictions as set out in the lock-up agreement in form and substance attached hereto as Exhibit C (the “Lock-Up Agreement”) including in accordance with U.S. securities laws that no transfer of the Optionee Shares shall be permitted for an initial period of six months following the date of issuance assuming all other requirements under Rule 144 promulgated under the Securities Act are satisfied at such time, and after such time 1/12th of the Optionee Shares will be released each month thereafter in accordance with the Lock-Up Agreement; and
  
 (b) at the Closing, the Optionor shall deliver a bringdown certificate of the representations and warranties provided by it in this Agreement, the Lock-Up Agreement duly executed by the Optionor, and a completed and signed copy of the U.S. accredited investor questionnaire in form and substance attached hereto as Exhibit D (the “Questionnaire”).
  
 1.5 Definitions. For purposes of this Agreement, the following terms shall be defined as follows:
  
 (a) “Change of Control Equivalent” means cash, shares or other securities or property (or any combination thereof) which holders of P13 Shares receive directly or indirectly with respect to or in exchange for each P13 Share pursuant to or as a result of a Change of Control. 
  
 (b) “Change of Control” means the acquisition of shares of the Optionee and/or securities convertible into, exercisable for or carrying the right to purchase shares of the Optionee (“Convertible Securities”) as a result of which a person or group of persons acting jointly or in concert, or persons associated or affiliated within the meaning of the Securities Act (Ontario) with any such person, group of persons or any such persons (collectively, the “Acquirors”) beneficially own shares of the Optionee or Convertible Securities such that, assuming only the conversion or exercise of Convertible Securities beneficially owned by the Acquirors, the Acquirors would beneficially own shares which would entitle them to cast more than 50% of the votes attaching to all shares in the capital of the Optionee which may be cast to elect directors of the Optionee. Notwithstanding the foregoing, any shares of the Optionee so beneficially held or acquired by Robert Groesbeck and/or Larry Scheffler shall not constitute a Change of Control. 
  
 (c) “Governmental Authority” means any federal, state, local or foreign government or political subdivision thereof, or any agency or instrumentality of such government or political subdivision, or any self-regulated organization or other non-governmental regulatory authority or quasi-governmental authority (to the extent that the rules, regulations or orders of such organization or authority have the force of law), or any arbitrator, court or tribunal of competent jurisdiction.
  
 	 
	3
	

	 

  
 2. Option Consideration. 
  
 2.1 Signing Date Payment. In consideration of the Option, the Optionee hereby agrees to pay to the Optionor, upon the execution of this Agreement, the sum of Twenty Thousand Dollars ($20,000) (the “Option Payment”) promptly upon the execution of this Agreement, in immediately available cash, by wire transfer to an account designated in writing by the Optionor. The Option Payment shall be nonrefundable to the Optionee except in the event the Optionor fails to consummate the Closing for any reason (other than due to a default by the Optionee or failure to obtain any Regulatory Approvals).
  
 2.2 Subsequent Payment. As further consideration for the Option, the Optionee hereby agrees to pay to the Optionor, on January 1, 2023, the sum of Forty Thousand Dollars ($40,000) (the “Second Option Payment”), by cash or wire transfer to an account designated in writing by the Optionor. In the event the Second Option Payment is not made by January 1, 2023, then the Optionee shall have thirty (30) days from receipt of written notice from the Optionor that the Second Option Payment is due and owing. The Second Option Payment shall be nonrefundable to the Optionee except in the event the Optionor fails to consummate the Closing for any reason (other than due to a default by the Optionee or failure to obtain any Regulatory Approvals).
  
 3. Representations and Warranties of the Optionee. The Optionee acknowledges and represents and warrants to the Optionor that the statements contained in this Section 3 are true and correct as of the date hereof, and as of the Closing.
  
 3.1 Requisite Power and Authority. It has all necessary power and authority to execute and deliver this Agreement and to carry out its provisions. All action on its part required for the lawful execution and delivery of this Agreement has been or will be effectively taken prior to the Closing. This Agreement is its valid and binding obligation, enforceable against it in accordance with its terms, except (a) as limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws of general application affecting enforcement of creditors’ rights and (b) as limited by general principles of equity that restrict the availability of equitable remedies.
  
 3.2 Investment Representations. It understands that none of the Option Units have been registered under the Securities Act of 1933, as amended (the “Securities Act”). It also understands that, if it elects to exercise its option to purchase Option Units, the Option Units will be offered and sold pursuant to an exemption from registration contained in the Securities Act based in part upon its representations contained in this Agreement.
  
 (a) Economic Risk. If it elects to exercise its option to purchase Option Units, it must bear the economic risk of this investment indefinitely unless the Option Units are registered pursuant to the Securities Act, or an exemption from registration is available. It understands that the Company has no present intention of registering the Option Units or any of its Units (as defined in the Operating Agreement). It also understands that there is no assurance that any exemption from registration under the Securities Act will be available and that, even if available, such exemption may not allow it to transfer all or any portion of the Option Units under the circumstances, in the amounts or at the times it might propose.
  
 	 
	4
	

	 

  
 (b) Acquisition for Own Account. If it elects to exercise its option to purchase Option Units, it is acquiring the Option Units for its own account for investment only, and not with a view towards their distribution.
  
 (c) It Can Protect its Interest. It represents that by reason of its management’s business or financial experience, it has the capacity to protect its own interests in connection with the transactions contemplated in this Agreement. Further, it is aware of no publication of any advertisement in connection with the transactions contemplated in this Agreement.
  
 (d) Accredited Investor. It represents that it is an “accredited investor” within the meaning of Regulation D under the Securities Act.
  
 (e) Rule 144. If it elects to exercise its option to purchase Option Units, it acknowledges and agrees that the Option Units must be held indefinitely unless they are subsequently registered under the Securities Act or an exemption from such registration is available. It has been advised or is aware of the provisions of Rule 144 promulgated under the Securities Act as in effect from time to time, which permits limited resale of shares purchased in a private placement subject to the satisfaction of certain conditions, including, among other things: the availability of certain current public information about the Company, the resale occurring following the required holding period under Rule 144 and the number of shares being sold during any three-month period not exceeding specified limitations.
  
 4. Representations and Warranties of the Optionor. The Optionor acknowledges and represents and warrants to the Optionee that the statements contained in this Section 4 are true and correct as of the date hereof, and as of the Closing.
  
 4.1 Requisite Power and Authority. The Optionor has all necessary power and authority to execute and deliver this Agreement and to carry out its provisions. All action on his part required for the lawful execution and delivery of this Agreement has been or will be effectively taken prior to the Closing. This Agreement is the valid and binding obligation of the Optionor, enforceable against him in accordance with its terms, except (a) as limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws of general application affecting enforcement of creditors’ rights and (b) as limited by general principles of equity that restrict the availability of equitable remedies.
  
 4.2 Title. The Optionor beneficially owns and has the unrestricted right to transfer the Option Units pursuant to this Agreement and, upon purchase of the Option Units pursuant to this Agreement, Optionee, will have good title to the purchased Option Units, free and clear of all liens, security interests, pledges, stockholder agreements, voting trusts, claims, charges and other encumbrances, other than the Operating Agreement.
  
 4.3 No Conflicts. The execution and delivery of this Agreement by the Optionor, the consummation of the transaction provided for herein, and the performance of the terms hereof, will not result in the breach of any of the terms and provisions of, or constitute a default under, or conflict with, or cause any acceleration of any obligation of the Optionor under any agreement, indenture or other instrument to which the Optionor is bound, any judgment, decree, or order, or award of any court, governmental body, or arbitrator, or any applicable law, rule, or regulation. 
  
 	 
	5
	

	 

  
 4.4 Consents. The Optionor has obtained all consents necessary under the Operating Agreement or otherwise required to sell and transfer the Option Units to the Optionee under this Agreement (other than any Regulatory Approvals); and all such consents remain in effect.
  
 4.5 Capitalization. There are 100,000,000 Class A Units outstanding under the Operating Agreement, 51,000,000 of which are owned by the Optionor, and no other Units (as defined in the Operating Agreement) are outstanding.
  
 4.6 Securities Matters.
  
 (a) No Prior Holdings; Acquisition for Investment. The Optionor is not a registered or beneficial holder of any securities of the Optionee. If the Optionee elects to exercise its option to purchase Option Units and, as a result, issues the P13 Shares to the Optionor as partial consideration, the Optionor acknowledges it will be acquiring such P13 Shares for investment for its own account and not as nominee or agent, and not with a view to the resale or distribution of any part thereof, and further represents that it has no present intention of selling, granting any participation in, or otherwise distributing the same. The Optionor further represents that it does not have any contract, undertaking, agreement or arrangement with any person to sell, transfer or grant participation to such person or to any third person, with respect to any of the P13 Shares. The Optionor understands that any P13 Share issuable hereunder will not be registered under the Securities Act, on the ground that the sale and the issuance of the P13 Shares is exempt from registration under the Securities Act pursuant to Section 4(a)(2) thereof, and that the Optionee’s reliance on such exemption is predicated on the Optionor’s representation set forth herein, including the Optionor’s completion and execution of the Questionnaire. The Optionor further understands that any P13 Shares issuable hereunder will constitute a distribution of securities that is exempt from the prospectus requirement of applicable Canadian securities laws.
  
 (b) Investment Experience. The Optionor acknowledges that it can bear the economic risk of the investment, and it has such knowledge and experience in financial and business matters that it is capable of evaluating the merits and risks of the investment in the P13 Shares. The Optionor (x) is an “accredited investor” within the meaning of Rule 501 of Regulation D promulgated under the Securities Act, and has duly completed and executed the Questionnaire, and (y) agrees that it will not take any action that could negatively impact the availability of the exemption from registration provided by Section 4(a)(2) of the Securities Act with respect to the sale and the issuance of the P13 Shares.
  
 (c) Information. The Optionor has carefully reviewed such information as it has deemed necessary with respect to the P13 Shares. The P13 Shares shall be subject to a hold period of four months and a day after the Closing Date under applicable Canadian securities laws and shall not be registered under Securities Act, and may not be offered or sold absent registration under United States federal and state securities laws or an applicable exemption from such United States federal and state registration requirements. To the Optionor’s full satisfaction, it has been furnished all materials requested by it relating to the Optionee, and the issuance of the P13 Shares hereunder, and the Optionor has been afforded the opportunity to ask questions of representatives of the Optionee, to obtain any information necessary to verify the accuracy of any representations or information made or given to it.
  
 	 
	6
	

	 

  
 (d) Restricted Securities. The Optionor understands that the P13 Shares issuable pursuant to this Agreement are restricted securities and may not be sold, transferred, or otherwise disposed of without registration under the Securities Act and applicable state and federal securities laws or an exemption therefrom, and that in the absence of an effective registration statement covering the P13 Shares or any available exemption from registration under the Securities Act and applicable state and federal securities laws, the P13 Shares must be held indefinitely. Without limitation of the foregoing, if the Optionee elects to exercise its option to purchase Option Units, the Option Units sold to the Optionee hereunder by the Optionor has a fair value of not less than CDN$150,000 and the Optionor understands that the P13 Shares may not be resold under applicable Canadian securities laws before the date that is four (4) months plus one (1) day following the Closing Date, is aware that the certificate which it shall receive evidencing the P13 Shares will bear a legend with respect to the resale restrictions under the Lock-Up Agreement and under applicable Canadian securities laws in substantially the following form:
  
 UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THIS SECURITY MUST NOT TRADE THE SECURITY BEFORE THE DATE THAT IS FOUR MONTHS AND ONE DAY AFTER THE CLOSING DATE.
  
 and, understands that after the date that is four (4) months plus one (1) day following the Closing Date, but still subject to the Lock-Up Agreement and applicable U.S. securities laws, the P13 Shares may be resold under applicable Canadian securities laws in each Province and Territory of Canada, provided: (i) the trade is not a “control distribution” as defined in National Instrument 45-102 – Resale of Securities; (ii) no unusual effort is made to prepare the market or create a demand for the P13 Shares; (iii) no extraordinary commission or consideration is paid in respect of such trade; and (iv) if the selling securityholder is an “insider” or “officer” of the Optionee (as such terms are defined by applicable Canadian securities laws), the insider or officer has no reasonable grounds to believe that the Optionee is in default of applicable Canadian securities laws. Unless registered under the Securities Act and applicable state securities laws, the certificate representing the P13 Shares shall also bear a legend in the following form:
  
 THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, (THE “SECURITIES ACT”) AND MAY NOT BE OFFERED, SOLD, EXCHANGED, MORTGAGED, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED EXCEPT: (A) TO THE ISSUER, (B) IN COMPLIANCE WITH (1) RULE 144 OR (2) RULE 144A UNDER THE SECURITIES ACT AND WITH APPLICABLE STATE SECURITIES LAWS, (C) IN CONNECTION WITH ANOTHER EXEMPTION UNDER THE SECURITIES ACT, OR (D) WITH THE PRIOR WRITTEN CONSENT OF THE ISSUER, UPON THE ISSUER RECEIVING, IN THE CASE OF CLAUSES (B)(1) AND (C) ABOVE, AN OPINION OF COUNSEL FOR THE HOLDER, STATING THAT SUCH SALE, TRANSFER, ASSIGNMENT OR HYPOTHECATION IS EXEMPT FROM THE REGISTRATION REQUIREMENTS UNDER THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS.
  
 	 
	7
	

	 

  
 Notwithstanding the foregoing, if any such securities are being sold pursuant to Rule 144 under the Securities Act, the legend may be removed by delivery to the registrar and transfer agent for such securities of an opinion of counsel of recognized standing reasonably satisfactory to the Optionee or its successor company to the effect that such legend is no longer required under applicable requirements of the Securities Act or applicable state securities laws.
  
 The Optionor is acquiring the P13 Shares as principal for its own account and not with a view toward, or for sale in connection with, any distribution thereof, or with any present intention of distributing or selling the P13 Shares in any Province or Territory of Canada. The Optionor is an “accredited investor” as defined in National Instrument 45-106 Prospectus Exemptions of the Canadian Securities Administrators and is able to bear the economic risk of an investment in the P13 Shares.
  
 The Optionor acknowledges that the Optionee may be required to file a report with the Canadian securities regulatory authorities containing personal information about the Optionor, including his full name, address and telephone number, the number and type of securities purchased, the total purchase price paid for the securities, the date of the closing and the exemption relied upon under applicable Canadian securities laws. The Optionor also acknowledges that the Optionee may be required to file one or more reports (including but not limited to a Form 8-K) with the U.S. Securities and Exchange Commission and the Canadian Securities Exchange (“CSE”) disclosing the terms of this Agreement, including the identity of the Optionor and the exemption relied upon under applicable U.S. securities laws and may be required to file a copy of this Agreement with the U.S. Securities and Exchange Commission and on SEDAR.
  
 4.7 Rule 144. The Optionor understands and acknowledges that (a) if the Optionee or any successor company is deemed to have been at any time previously an issuer with no or nominal operations and no or nominal assets other than cash and cash equivalents, Rule 144 under the Securities Act may not be available for resales of the P13 Shares and (b) the Optionee is not obligated to make Rule 144 under the Securities Act available for resales of such P13 Shares.
  
 4.8 Registration Statement. The Optionor understands and acknowledges that the Optionee has no obligation or present intention of filing with the U.S. Securities and Exchange Commission or with any state securities administrator any registration statement in respect of resales of the P13 Shares in the United States.
  
 4.9 Residence. The Optionor represents he is a resident of Westmont, Illinois, United States of America.
  
 5. Covenants.
  
 5.1 Consent. Each of the parties hereto hereby consents to this Agreement and the transactions contemplated hereby and waives any rights it may have with respect thereto under the Operating Agreement, or otherwise.
  
 	 
	8
	

	 

  
 5.2 No Changes. The Optionor covenants and agrees that it shall cause the Company, during the Exercise Period, not to merge or consolidate with any entity, sell all or any substantial part of its assets, including the Conditional License, materially amend the Operating Agreement, or otherwise take any action which would hinder, obstruct or frustrate the transactions contemplated under this Agreement, except as expressly permitted in the Operating Agreement.
  
 5.3 Further Assurances. Beginning on the date hereof through the Closing Date, each of the parties hereto shall execute and deliver such additional documents, instruments, conveyances and assurances and take such further actions as may be reasonably required to carry out the provisions hereof and give effect to the transactions contemplated by or in connection with this Agreement.
  
 5.4 Exclusivity. The Optionor agrees that from the date hereof until (a) the Closing, if the Optionee exercises the Option, or (b) expiration of the Exercise Period, if the Optionee does not exercise the Option, neither the Optionor nor any affiliate or representative or agent of the Optionor (including, without limitation, any investment banker, attorney or accountant), will, directly or indirectly, (i) solicit, engage in discussions or negotiate with any person (whether such discussions or negotiations are initiated by the Optionor) or take any other action relating to the sale of all or any portions of the Option Units or any Units, or any other similar transaction, (ii) provide information to any person or entity relating to any such transaction or potential transaction, (iii) enter into an agreement or understanding with any person or entity providing for any such transaction or potential transaction, or (iv) make or authorize any statement, recommendation or solicitation in support of or approving any such transaction or potential transaction. The Optionor further agrees that he will promptly notify the Optionee if any proposal or offer, or any inquiry or contact with any person with respect thereto, is made as to the purchase of the Option Units or any Units.
  
 6. Miscellaneous.
  
 6.1 Governing Law; Jurisdiction. This Agreement shall be governed by and construed in accordance with the domestic laws of the State of Illinois without giving effect to any choice or conflict of law provision or rule (whether of the State of Illinois or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Illinois. Each of the parties hereto (a) consents to submit itself to the personal jurisdiction of any federal court located in the State of Illinois or any Illinois state court in the event any dispute arises out of this Agreement or any of the transactions contemplated by this Agreement; (b) agrees that it will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such court, and (c) agrees that it will not bring any action relating to this Agreement or any of the transactions contemplated by this Agreement in any court other than a federal court sitting in the State of Illinois or an Illinois state court.
  
 6.2 Specific Enforcement. The Optionor also acknowledges that any breach by him of this Agreement will cause continuing and irreparable injury to the Optionee for which monetary damages would not be an adequate remedy. The Optionor shall not, in any action or proceeding to enforce any of the provisions of this Agreement, assert the claim or defense that an adequate remedy at law exists. In the event of such breach by the Optionor, the Optionee shall have the right to enforce the provisions of this Agreement by seeking injunctive or other relief in any court, and this Agreement shall not in any way limit remedies of law or in equity otherwise available to the Optionee.
  
 	 
	9
	

	 

  
 6.3 Survival; Indemnification. 
  
 (a) The representations, warranties, covenants and agreements made herein shall survive any investigation made by any party and the closing of the transactions contemplated hereby.
  
 (b) In the event the Optionor breaches any of its representations, warranties, and covenants contained in this Agreement, or in any written instrument or certificate furnished or to be furnished to the Optionee by the Optionor, and provided that the Optionee makes a written claim for indemnification against the Optionee in accordance with Section 6.11, then the Optionor shall indemnify the Optionee, its affiliates, successors and permitted assigns (the “Optionee Indemnitees”) and hold each Optionee Indemnitee harmless from and against any and all actions, suits, proceedings, hearings, investigations, charges, complaints, claims, demands, injunctions, judgments, orders, decrees, rulings, damages, dues, penalties, fines, costs, reasonable amounts paid in settlement, liabilities, obligations, taxes, liens, losses, expenses, and fees, including court costs and reasonable attorneys’ fees and expenses, suffered or incurred by any Optionee Indemnitee as a result of, arising out of or in connection with such breach by the Optionor.
  
 6.4 Entire Agreement. This Agreement, the Exhibits hereto and the other documents delivered pursuant hereto constitute the full and entire understanding and agreement between the parties with respect to the subject matter hereof, and supersedes all prior and contemporaneous understandings and agreements between the parties, whether oral or written, and no party shall be liable or bound to any other in any manner by any representations, warranties, covenants and agreements except as specifically set forth herein and therein.
  
 6.5 Confidentiality. The Optionor and the Optionee acknowledge that the existence and the terms of this Agreement and any oral or written information exchanged between the parties in connection with the preparation and performance this Agreement are regarded as confidential information. Each party shall maintain confidentiality of all such confidential information, and without obtaining the written consent of the other party, it shall not disclose any relevant confidential information to any third parties, except for the information that: (a) is or will be in the public domain (other than through the receiving party’s unauthorized disclosure); (b) is under the obligation to be disclosed pursuant to the applicable laws or regulations (including, but not limited to, filings required to be made with the U.S. Securities and Exchange Commission, the CSE and on SEDAR), rules of any stock exchange, including the CSE, or orders of the court or other government authorities; or (c) is required to be disclosed by any party to its shareholders, investors, legal counsels or financial advisors regarding the transaction contemplated hereunder; provided that such shareholders, investors, legal counsels or financial advisors shall be bound by the confidentiality obligations similar to those set forth in this subsection. Notwithstanding anything in this section to the contrary, the Optionor and the Optionee will have the right to make such disclosures regarding this Agreement and the Option Units to the extent reasonably necessary in connection with the regulatory approval activities described herein (including discussions with governmental officials and staff). Disclosure of any confidential information by the staff members or agencies hired by any party shall be deemed disclosure of such confidential information by such party, which party shall be held liable for breach of this Agreement. This subsection shall survive the termination of this Agreement for any reason.
  
 	 
	10
	

	 

  
 6.6 Public Announcements. Unless otherwise required by applicable law or stock exchange applicable to a party or its affiliates, no party to this Agreement shall make any public announcements in respect of this Agreement or the transactions contemplated hereby without the prior written consent of the other party(ies) (which consent shall not be unreasonably withheld, conditioned or delayed), and the parties shall cooperate as to the timing and contents of any such announcement; provided, however, that any party and its affiliates may, without the prior written consent of other party(ies), make any public statement or disclosure to the extent the substance of such public statement or disclosure is consistent with any previous press release, statement or disclosure made in accordance with, or permitted by, this Section 6.6.
  
 6.7 Expenses. Except as otherwise expressly provided herein, all costs and expenses, including, without limitation, fees and disbursements of counsel, financial advisors and accountants, incurred in connection with this Agreement shall be paid by the party incurring such costs and expenses, whether or not the Closing shall have occurred. Notwithstanding the foregoing, any fees associated with obtaining the requisite approvals from the IDFPR shall be paid by the Optionee.
  
 6.8 Severability. In case any provision of the Agreement shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
  
 6.9 Successors and Assigns. This Agreement and the rights and obligations hereunder may not be assigned by either party hereto without the express written consent of the other party hereto; provided, however, that the Optionee shall may assign this Agreement to any of its affiliates or to any person or entity in connection with a Change of Control, in each case, without the Optionor’s consent. This Agreement shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors, permitted assigns, heirs, executors and administrators.
  
 6.10 Amendment and Waiver. Except as otherwise expressly provided, this Agreement may be amended or modified only upon the written consent of the Optionee and the Optionor.
  
 6.11 Notices and Consents. All notices and consents required or permitted hereunder must be in writing and shall be deemed effectively given: (a) upon personal delivery to the party to be notified, (b) when sent by confirmed facsimile if sent during normal business hours of the recipient; if not, then on the next business day, (c) three (3) days after having been sent by certified mail, return receipt requested, postage prepaid, or (d) one (1) business day after deposit with a nationally recognized overnight courier, specifying next day delivery, with written verification of receipt. All communications shall be sent to the party to be notified at the address as set forth below or at such other address as such party may designate by five (5) days advance written notice to the other parties hereto.
  
 	 
	11
	

	 

  
 If to Optionee, to:
  
 Planet 13 Holdings Inc.
 2548 West Desert Inn Road
 Las Vegas, NV 89109
 Attn: Legal
  
 with a copy to:
  
 Cozen O’Connor
 1650 Market Street, Suite 2800
 Philadelphia, PA 19103
 Attn: Joseph Bedwick, Esq.
  
 If to the Optionor to:
  
 Frank Cowan, IV
 3902 N. Grant Street
 Westmont, IL 60559
  
 6.12 Titles and Subtitles. The titles of the sections and subsections of the Agreement are for convenience of reference only and are not to be considered in construing this Agreement.
  
 6.13 Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, and all of such shall together constitute one and the same instrument. A signed copy of this Agreement delivered by facsimile, email or other means of electronic communication shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.
  
 6.14 Pronouns. All pronouns contained herein, and any variations thereof, shall be deemed to refer to the masculine, feminine or neutral, singular or plural, as to the identity of the parties hereto may require.
  
 6.15 Representation. Each party to this Option Purchase Agreement has been represented by separate counsel in the preparation and negotiation of this Option Purchase Agreement. Since the terms of this Option Purchase Agreement have been mutually negotiated and agreed upon, to the extent this Option Purchase Agreement must be construed, it will not be construed against any party as the drafter.
  
 [SIGNATURE PAGE FOLLOWS]
  
 	 
	12
	

	 

  
 IN WITNESS WHEREOF, the parties hereto have executed this Option Purchase Agreement as of the date set forth in the first paragraph hereof.
  
 	 	OPTIONOR:	
	 	 	 	 
		/s/ Frank Cowan, IV  	
	  
	 Frank Cowan, IV
	 
	 	 		 
	 	OPTIONEE:	 
	  
	  
	  

	  
	 PLANET 13 HOLDINGS INC.
	  

	  
	  
	  
	  

	  
	 By:
	 /s/ Larry Scheffler
	  

	  
	 Name:
	 Larry Scheffler
	  

	  
	 Title:
	 Co-CEO
	  

  
 	 
	13
	

	 

  
 Consent
  
 Planet 13 Illinois, LLC hereby consents to all of the provisions in this Option Purchase Agreement, agrees to fulfill the responsibilities of the Company set forth herein, and executes and delivers this Consent as of August 4, 2022.
  
 	PLANET 13 ILLINOIS, LLC	
	 	 	 
	By:	/s/ Frank Cowan	
	 Name:
	Frank Cowan	 
	Title: 	Manager	 

  
 	 
	14
	

	 

  
 EXHIBIT A
  
 Exercise Notice
  
 To: [insert]
  
 Reference is made to that certain Option Purchase Agreement (the “Agreement”), dated as of _____, 2022, by and between FRANK COWAN, IV, an adult individual (the “Optionor”), and PLANET 13 HOLDINGS INC., a British Columbia corporation (the “Optionee”). Defined terms used herein shall have the meanings set forth in the Agreement.
  
 Pursuant to the Agreement, notice is hereby given that the Optionee is exercising the Option to purchase the Option Units, subject to the terms and conditions of the Agreement.
  
 	 	PLANET 13 HOLDINGS INC.	
	 	 	 	 
		By:		
	  
	 Name:
		 
	 	Title:		 
	 	 	 	 
	  
	 Dated: __________, 20__
	  

  
 	 
	15
	

	 

  
 EXHIBIT B
  
 ASSIGNMENT OF MEMBERSHIP INTERESTS
 OF 
 PLANET 13 ILLINOIS, LLC
  
 KNOW ALL MEN BY THESE PRESENTS, that Frank Cowan, IV (“Assignor”), for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, does hereby assign, transfer and convey to Planet 13 Holdings Inc., a British Columbia corporation (“Assignee”), all of Assignor’s right, title and interest in, to and under all of the Units (the “Units”) in Planet 13 Illinois, LLC, an Illinois limited liability company (the “Company”), constituting a 51% ownership interest in the Company, as reflected on the Company’s books and records.
  
 Assignor hereby represents and warrants that the assignment of the Units are, and will be as of the effective date hereof, free and clear of any lien, security interest, restriction, claim or encumbrance.
  
 IN WITNESS WHEREOF, Assignor, intending to be legally bound, has executed this Assignment as of the __________ day of __________, 202_.
  
                                                                                                                               
 	  
		ASSIGNOR	
	  
	  
	  
	  

	  
		  
	  

	  
		 Frank Cowan, IV
	  

	  
	 	 	 

  
   
 	 
	16
	

	 

  
 EXHIBIT C
  
 LOCK-UP AGREEMENT
  
 	 
	17
	

	 

  
 Restricted Stock Lock-Up Agreement
  
 ________, 202___
  
 Planet 13 Holdings Inc.
 2548 West Desert Inn Road
 Las Vegas, Nevada
 89109
  
 Ladies and Gentlemen:
  
 As an inducement to Planet 13 Holdings Inc., a corporation organized under the Business Corporations Act (British Columbia) (the “Optionee”) to execute the option purchase agreement (the “Purchase Agreement”), dated as of August ___, 2022, by and among, the undersigned, an individual residing in the State of Illinois, and the Optionee, which provides for the issuance (the “Issuance”) of common shares of the Optionee (the ”Restricted Stock”) in the event the Optionee exercises its option to purchase the Option Units, which option the Optionee has exercised, the undersigned hereby agrees that without, in each case, the prior written consent of the Optionee during the Lock-Up Period (defined below), the undersigned will not: (1) offer, pledge, announce the intention to sell, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, make any short sale or otherwise transfer or dispose of, directly or indirectly, any shares of the Restricted Stock or any securities convertible into, exercisable or exchangeable for or that represent the right to receive Restricted Stock (including without limitation, Restricted Stock which may be deemed to be beneficially owned by the undersigned in accordance with the rules and regulations of the Securities and Exchange Commission and securities which may be issued upon exercise of a stock option or warrant) whether now owned or hereafter acquired (the ”Undersigned’s Securities”); (2) enter into any swap or other agreement that transfers, in whole or in part, any of the economic consequences of ownership of the Undersigned’s Securities, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of Restricted Stock or such other securities, in cash or otherwise; (3) make any demand for or exercise any right with respect to, the registration of any Restricted Stock or any security convertible into or exercisable or exchangeable for Restricted Stock; or (4) publicly disclose the intention to do any of the foregoing. Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Purchase Agreement.
  
 The undersigned agrees that the foregoing restrictions preclude the undersigned from engaging in any hedging or other transaction which is designed to or which reasonably could be expected to lead to or result in a sale or disposition of the Undersigned’s Securities even if such securities would be disposed of by someone other than the undersigned. Such prohibited hedging or other transactions would include without limitation any short sale or any purchase, sale or grant of any right (including without limitation any put or call option) with respect to any of the Undersigned’s Securities or with respect to any security that includes, relates to, or derives any significant part of its value from such securities.
  
 The “Lock-Up Period” shall commence on the date of this Restricted Stock Lock-Up Agreement (“Agreement”) and continue for a period of eighteen (18) months following the Closing Date provided that commencing on the date that is seven (7) months from the Closing Date and on the same date in each subsequent month thereafter (each such period, a “Monthly Lock-Up Period”), 1/12th of the Undersigned’s Securities shall not be subject to this Agreement.
  
 Notwithstanding the foregoing, during the Lock-Up Period, the undersigned may transfer, sell or tender any or all of the Undersigned’s Securities pursuant to a take-over bid (as defined in the Securities Act (Ontario)) or any other similar transaction, including, without limitation, a merger, arrangement or amalgamation, involving a Change of Control (as defined in the Purchase Agreement) of the Optionee (provided, that all Locked-Up Securities that are not so transferred, sold or tendered remain subject to this undertaking; and provided, further, that it shall be a condition of transfer that if such take-over bid or other transaction is not completed, any Locked-Up Securities subject to this Agreement shall remain subject to the restrictions herein).
  
 	 
	18
	

	 

  
 The undersigned agrees that for a period of six (6) months following the date hereof (the “Standstill Period”) other than in connection with the transactions contemplated by the Purchase Agreement, neither he nor any person acting on behalf of, or in concert with him will, directly or indirectly, without the Optionee’s prior written consent, (i) acquire, agree to acquire, propose, seek or offer to acquire, any securities or assets of the Optionee or any of its subsidiaries, (ii) enter, agree to enter, propose, seek or offer to enter into any merger, business combination, recapitalization, restructuring or other extraordinary transaction involving the Optionee or any of its subsidiaries, (iii) make, or in any way participate or engage in, any solicitation of proxies to vote any voting securities of the Optionee, (iv) form, join or in any way participate in a “group” (within the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended) with respect to any voting securities of the Optionee, (v) otherwise act, alone or in concert with others, to seek to control or influence the management or the policies of the Optionee, (vi) disclose any intention, plan or arrangement prohibited by, or inconsistent with, the foregoing, or (vii) advise, assist or encourage or enter into any discussions, negotiations, agreements or arrangements with any other persons in connection with the foregoing. The undersigned further agrees that during the Standstill Period none of such parties (nor any person acting on behalf of or in concert with such parties) will, without the written consent of the Optionee, (x) request the Optionee or any of his representatives, directly or indirectly, to amend or waive any provision of this paragraph (including this sentence), or (y) take any action that might require the Optionee to make a public announcement regarding the possibility of a business combination, merger or other type of transaction described in this paragraph with such party.
  
 The undersigned acknowledges that (a) the Optionee may impose stock transfer restrictions on the Undersigned’s Securities (including without limitation placing legends on the Restricted Stock indicating that such are subject to this Agreement) to enforce the provisions of this Agreement and (b) the restrictions imposed by this Agreement are in addition to any other restrictions imposed on the Undersigned’s Securities pursuant to any other agreement in effect with the undersigned or any hold periods, resale restrictions and/or restrictions on transfer imposed by Canadian and United States law as set out in the Purchase Agreement.
  
 The undersigned hereby acknowledges that any notice properly delivered to the undersigned in accordance with the notice provisions in the Purchase Agreement will be deemed to have been given to, and received by, the undersigned. The undersigned further agrees that, prior to engaging in any transaction or taking any other action that is subject to the terms of this Agreement during the period from the date of this Agreement to and including the 34th day following the expiration of the final Monthly Lock-Up Period, it will give notice thereof to the Optionee and will not consummate such transaction or take any such action unless it has received written confirmation from the Optionee that the Lock-Up Period (as may have been extended pursuant to the previous paragraph) has expired.
  
 In furtherance of the foregoing, the Optionee and its transfer agent and registrar are hereby authorized to decline to make any transfer of shares of Restricted Stock if such transfer would constitute a violation or breach of this Agreement and/or applicable law.
  
 The undersigned hereby represents and warrants that the undersigned has full power and authority to enter into this Agreement and that upon request, the undersigned will execute any additional documents necessary to ensure the validity or enforcement of this Agreement. All authority herein conferred or agreed to be conferred and any obligations of the undersigned shall be binding upon the successors, assigns, heirs or personal representatives of the undersigned.
  
 The undersigned understands that the undersigned shall be released from all obligations under this Agreement if (i) the Optionee notifies the undersigned that it does not intend to proceed with the Issuance or (ii) the Purchase Agreement does not become effective, or if the Purchase Agreement (other than the provisions thereof which survive termination) shall terminate or be terminated prior to the delivery of the Restricted Stock to be issued thereunder.
  
 	 
	19
	

	 

  
 The undersigned understands that the Optionee is entering into the Purchase Agreement and proceeding with the Issuance in reliance upon this Agreement.
  
 The undersigned hereto agrees that any breach by it of any provision of this Agreement would irreparably injure the Optionee and that money damages would be an inadequate remedy therefor. Accordingly, each party hereto agrees that the Optionee shall be entitled to one or more injunctions enjoining any such breach and requiring specific performance of this Agreement and consents to the entry thereof, in addition to any other remedy to which the Optionee is entitled at law or in equity. This Agreement shall be governed by, and construed in accordance with, the laws of the State of Illinois.
  
                                                                                                 
 	 		Very truly yours,	
	  
	  
	  
	  

	 	 	Frank Cowan, IV	 
	  
	  
	  
	  

	  
	  
	  
	  

			Printed Name of Holder	
	  
	  
	  
	  

	  
	  
	  
	  

	  
	  
	Signature	 

  
 	 
	20
	

	 

  
 EXHIBIT D
  
 US ACCREDITED INVESTOR QUESTIONNAIRE
  
 The information elicited by this Accredited Investor Questionnaire (this “Questionnaire”) will be used to enable Planet 13 Holdings Inc. (the “Company”) to determine whether you or the prospective investor on whose behalf you are providing this information, as the case may be, qualify as an “accredited investor” as that term is defined in Regulation D promulgated under the Securities Act of 1933, as amended (the “Securities Act”), and similar requirements of other applicable securities laws. The Company will rely upon the information contained herein for the purpose of making such determination and for the purpose of offering the Company’s securities (the “Securities”). The request to complete this Questionnaire does not constitute an offer to sell or the solicitation of an offer to acquire any securities of the Company. 
  
 INSTRUCTIONS:
  
 Your answers will be kept confidential; however, you agree that the Company may present this Questionnaire to such persons as it deems appropriate to establish that the issuance of the Securities to you is exempt from the registration requirements of the Securities Act or meets the requirements of applicable state securities laws. If you have questions concerning any of the information requested in this Questionnaire, you should consult with your purchaser representative, lawyer, accountant or broker or may contact Leighton Koehler at lkoehler@planet13holdings.com.
  
 If the answer to any question is “None” or “Not Applicable,” please so state.
  
 One signed and dated a copy of this Questionnaire should be returned as soon as possible to Planet 13 Holdings Inc. to Leighton Koehler via email at lkoehler@planet13holdings.com.
  
 (Print or type your responses)
  
 	 1.
	 Name:                                                                                                                                                                   

	  
	  

	  
	 Date of birth or year of organization:                                                                                                                   

	  
	  

	 2.
	 Home address or, if other than an individual, principal office address:

	  
	                                                                                                                                                                                

	  
	  

	  
	                                                                                                                                                                                

	  
	  

	 3.*
	 Employer:                                                                                                                                                             

	  
	  

	  
	 Nature of business:                                                                                                                                              

	  
	  

	  
	  

	  
	 Position:                                                                                                                                                               

	  
	  

	  
	 Nature of duties:                                                                                                                                                  

	  
	  

	  
	 Business address:                                                                                                                                                

	  
	  

	  
	 Business telephone number:                                                                                                                               

	  
	  

	  
	 *This question is to be answered if the investor is an individual.

        
 	 
	21
	

	 

  
 	 4.
	 In the case of any individual investor, I am an “accredited investor” (as defined in Rule 501 of Regulation D promulgated under the Securities Act) because I certify that (check all appropriate descriptions that apply):

 	  
	  
	  
	  

	  
	 (a)
	 _____
	 I am a natural person whose individual net worth, or joint net worth with my spouse or spousal equivalent, exceeds $1,000,000. 1

	  
	  
	  
	  

	  
	 (b)
	 _____
	 I am a natural person who had individual income exceeding $200,000 in each of the two most recent calendar years and I have a reasonable expectation of reaching the same income level in the current calendar year.2

	  
	  
	  
	  

	  
	 (c)
	 _____
	 I am a natural person who had joint income with my spouse or spousal equivalent exceeding $300,000 in each of the two most recent calendar years and I have a reasonable expectation of reaching the same income level in the current calendar year, as defined above.

	  
	  
	  
	  

	  
	 (d)
	 _____
	 I am a director, executive officer or general partner of the Company, or a director, executive officer or general partner of a general partner of the Company. (Executive officer means the president, any vice president in charge of a principal business unit, division or function (such as sales, administration or finance) or any other person or persons who perform(s) similar policy-making functions for the Company.)

                                                                                                                     
 1For purposes of this Questionnaire, “net worth” means the excess of total assets at fair market value (including personal and real property, but excluding the estimated fair market value of a person’s primary residence) over total liabilities. “Total liabilities” excludes any mortgage on the primary residence in an amount of up to the home’s estimated fair market value as long as the mortgage was incurred more than 60 days before the Securities are purchased, but includes (i) any mortgage amount in excess of the home’s fair market value and (ii) any mortgage amount that was borrowed during the 60-day period before the closing date for the sale of Securities for the purpose of investing in the Securities. “Spousal equivalent” means a cohabitant occupying a relationship generally equivalent to that of a spouse. “Joint net worth” can be the aggregate net worth of a person and spouse or spousal equivalent; assets do not need to be held jointly to be included in the calculation.
 2For purposes of this Questionnaire, “individual income” means individual annual adjusted gross income, as reported for federal income tax purposes, plus (i) the amount of any tax-exempt interest income received, (ii) the amount of losses claimed as a limited partner in a limited partnership, (iii) any deduction claimed for depletion, (iv) amounts contributed to an IRA or Keogh retirement plan, (v) alimony paid; and (vi) any amount by which income from long-term capital gains has been reduced in arriving at adjusted gross income pursuant to the provisions of Section 1202 of the Internal Revenue Code of 1986, as amended.
  
 	 
	22
	

	 

  
 	  
	 (e)
	 _____
	 I hold one of the following professional certifications, designations or credentials in good standing: General Securities Representative license (Series 7), the Private Securities Offerings Representative license (Series 82), or the Investment Adviser Representative license (Series 65), each as administered by the Financial Industry Regulatory Authority, Inc.

	  
	  
	  
	  

	  
	 (f)
	 _____
	 I am a “knowledgeable employee,” as defined in rule 3c-5(a)(4) under the Investment Company Act of 1940 (17 CFR 270.3c-5(a)(4)), of the Company where the Company would be an investment company, as defined in section 3 of such act, but for the exclusion provided by either section 3(c)(1) or section 3(c)(7) of such act.

	  
	  
	  
	  

	  
	  
	  

	 5.
	 In the case of any partnership, corporation, trust and other entity investor, the undersigned certifies that (check all appropriate descriptions that apply):
	  

	  
	  
	  

	  
	 (a)3
	 _____
	 Each equity owner of the investor qualifies as an “accredited investor” under items 4 and 5 hereof.

	  
	  
	  
	  

	  
	 (b)
	 _____
	 The investor is either: (i) a bank as defined in Section 3(a)(2) of the Securities Act, or any savings and loan association or other institution as defined in Section 3(a)(5)(A) of the Securities Act, whether acting in its individual or fiduciary capacity; (ii) an insurance company as defined in Section 2(13) of the Securities Act; (iii) an investment company registered under the Investment Company Act of 1940 or a business development company as defined in Section 2(a)(48) of such act; (iv) a Small Business Investment Company licensed by the U. S. Small Business Administration under Section 301(c) or (d) of the Small Business Investment Act of 1958; or (v) an employee-benefit plan within the meaning of the Employee Retirement Income Security Act of 1974, if the investment decision is made by a plan fiduciary, as defined in Section 3(21) of such act, and the plan fiduciary is either a bank, savings and loan association, insurance company or registered investment adviser, if the employee-benefit plan has total assets in excess of $5,000,000, or if the plan is a self-directed plan with investment decisions made solely by persons who are “accredited investors” as defined herein.

                                                               
 3An investor initializing this item must provide a separate Questionnaire from each of its equity owners. If the investor is a trust, only a trust which is revocable and which may be amended at the sole discretion of its grantor is eligible to qualify as an accredited investor under this item 5(a). The grantors of the trust are deemed to be the equity owners of the revocable trust and each grantor must complete a separate Questionnaire. If the investor is an irrevocable trust, the investor’s eligibility to qualify as an accredited investor will be determined solely under item 5(f), and the grantor thereof would not be deemed an equity owner of the trust and need not complete a separate Questionnaire.
 	 
	23
	

	 

  
 	  
	 (c)
	 _____
	 The investor is a private business development company as defined in Section 202(a)(22) of the Investment Advisers Act of 1940.

	  
	  
	  
	  

	  
	 (d)
	 _____
	 The investor is an organization described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended, not formed for the specific purpose of the contemplated investment with total assets exceeding $5,000,000.

	  
	  
	  
	  

	  
	 (e)
	 _____
	 The investor is a corporation, Massachusetts or similar business trust, partnership or limited liability company not formed for the specific purpose of the contemplated investment, with total assets exceeding $5,000,000.

	  
	  
	  
	  

	  
	 (f)
	 _____
	 The investor is a trust, not formed for the specific purpose of the contemplated investment, with total assets exceeding $5,000,000 and whose purchase is directed by a person who has such knowledge and experience in financial and business matters that he or she is capable of evaluating the merits and risks of the investment in the securities offered.

	  
	  
	  
	  

	  
	 (g)
	 _____
	 The investor is a broker or dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934.

	  
	  
	  
	  

	  
	 (h)
	 _____
	 The investor is an investment adviser registered pursuant to Section 203 of the Investment Advisers Act of 1940 or registered pursuant to the laws of a state.

	  
	  
	  
	  

	  
	 (i)
	 _____
	 The investor is an investment adviser relying on the exemption from registering with the Securities Exchange Commission under Section 203(l) or (m) of the Investment Advisers Act of 1940.

	  
	  
	  
	  

	  
	 (j)
	 _____
	 The investor is a Rural Business Investment Company as defined in Section 384A of the Consolidated Farm and Rural Development Act.

	  
	  
	  
	  

	  
	 (k)
	 _____
	 The investor is a plan established and maintained by a state, its political subdivisions, or any agency or instrumentality of a state or its political subdivisions, for the benefit of its employees, if such plan has total assets in excess of $5,000,000.

  
 	 
	 24

	

	 

  
 	  
	 (l)
	 _____
	 The investor is an entity, of a type not listed in paragraphs 5(a) to 5(k), not formed for the specific purpose of acquiring the securities offered, owning investments in excess of $5,000,000.4

	  
	  
	  
	  

	  
	 (m)
	 _____
	 The investor is a “family office,” as defined in rule 202(a)(11)(G)-1 under the Investment Advisers Act of 1940, that (i) has assets under management in excess of $5,000,000, (ii) is not formed for the specific purpose of acquiring the Securities, and (iii) whose prospective investment is directed by a person who has such knowledge and experience in financial and business matters that such family office is capable of evaluating the merits and risks of the prospective investment. 

	  
	  
	  
	  

	  
	 (n)
	 _____
	 The investor is a “family client,” as defined in rule 202(a)(11)(G)-1 under the Investment Advisers Act of 1940, of a family office meeting the requirements in item 5(m) above and whose prospective investment in the Company is directed by such family office pursuant to item 5(m)(iii) above.

                                                                                                                       
 4 For purposes of this questionnaire, the term “investments” is as defined in Rule 2a51-1(b) under the Investment Company Act of 1940.
  
 [Remainder of Page Intentionally Left Blank; Signature Page Follows]
  
 	 
	25
	

	 

  
 The undersigned certifies that the foregoing responses are true, complete and accurate to the best of the undersigned’s knowledge and belief. The undersigned will provide such further information as may be requested by the Company in connection with determining the undersigned’s status as an accredited investor. The undersigned will notify the Company in writing regarding any material change to any of the responses prior to the closing of the purchase of Securities from the Company. Absent such notification, the issuance of Securities in the name of the undersigned shall be deemed to be an automatic affirmation by the undersigned of the truth and accuracy of the statements and information set forth above. The undersigned understands that a false representation may constitute a violation of law, and that any person who suffers damage as a result of a false representation may have a claim against the undersigned for damages.
  
 	                                                    	 		 	
	Date 	 	Type or Print Name of Prospective Investor	 	 
	  
	  
	  
	  
	  

		 		 	
		 	Signature of Prospective Investor or 	 	 
	 	 	Authorized Signatory of Entity Investor, as applicable	 	 
	  
	  
	  
	  
	  

		 		 	
		 	Title of Authorized Signatory of Entity Investor	 	 
	 	 	(if applicable)	 	 

  
  
 	 
	 26

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00347-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00347-of-00352.parquet"}]]