CANN TREES Corporation (QB)

 

 

UNITED STATES 

SECURITIES AND EXCHANGE COMMISSION 

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT 

 

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): July 1, 2023 

 

TREES CORPORATION

(Exact Name of Registrant as Specified in Charter)

 

Colorado		000-54457		90-1072649
(State or other jurisdiction of incorporation)		(Commission File Number)		(I.R.S. Employer Identification Number)

 

215 Union Boulevard, Suite 415 Lakewood, Colorado		80228
(Address of principal executive offices)		(Zip Code)

  

Registrant’s telephone number, including area code: (303) 759-1300 

 

(Former name or former address, if changed since last report) 

 

Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions: 

 

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) 

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
N/A		N/A		N/A

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging Growth Company ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 

Item 1.01

Entry into a Material Definitive Agreement.

 

 On July 1, 2023, the Company and its subsidiaries Green Tree Colorado, LLC, Green Tree Cultivation LLC, GT Retail LLC, and Green Tree MIP LLC, each a Colorado limited liability company, entered into a settlement agreement (“Settlement Agreement”) with Allyson Feiler Downing (“Downing”) and Loree Schwartz (“Schwartz” and together with Downing, “Green Tree Parties”), pursuant to which the Company and the Green Tree Parties agreed to transfer and assign to new entities controlled by the Green Tree Parties, cannabis licenses and related assets owned by (i) GT Retail relating to a cultivation facility and a retail dispensary located in Berthoud, Colorado; (ii) GT MIP relating to a ‘marijuana infused product’ dispensary located in Boulder County, Colorado; and (iii) certain intellectual property in respect thereof (collectively, the “Transferred Assets”). The Company retained accounts payable and certain cannabis inventory in respect of the Transferred Assets. Closing of the transaction is subject to approval of the license transfers by the Colorado Marijuana Enforcement Division as well as local regulatory authorities.

 

In exchange for the transfer to the Green Tree Parties of the Transferred Assets, the Company and the Green Tree Parties agreed that upon closing, the Green Tree Parties shall transfer and assign to the Company, and the Company shall redeem, 9,917,574 shares of the Company’s Common Stock owned by the Green Tree Parties and originally issued to the Green Tree Parties in the acquisition consummated in December 2022 pursuant to that certain Asset Purchase Agreement dated September 13, 2022, as amended, by and among the Company, Downing, Schwartz and various other parties thereto (the “APA”). Further, other than payments due Michael Abrams, no further payments shall be due either of the Green Tree Parties or any affiliate thereof under the APA or otherwise.

 

On July 1, 2023, the Company terminated the employment of each of Downing and Schwartz and each of Downing and Schwartz entered into a Termination of Employment Agreement and Mutual General Release with the Company (“Termination Agreements”). The Termination Agreements provide for the termination of employment by the Company of each of Downing and Schwartz, including a termination of their respective Employment Agreements with the Company dated December 12, 2022, mutual releases, and a waiver of the non-compete and non-solicitation agreements contained in the APA. The parties also executed a separate waiver in respect thereof (“Waiver”).

 

Furthermore, also on July 1, 2023, the Company and a newly-formed entity controlled by the Green Tree Parties entered into a consulting agreement pursuant to which such entity together with Downing agreed to pay consulting fees to the Company in an aggregate amount equal to $289,452.39, subject to and conditioned upon the Company’s completion of payments under the APA to Michael Abrams of $562,380.95 (“Consulting Agreement”).

 

On July 1, 2023, the parties also entered into a Transition Services Agreement pursuant to which the Green Tree Parties will provide certain administrative and management services on a transition basis to the Company in respect of the Transferred Assets in exchange for retaining all revenue generated from the businesses relating to the Transferred Assets; until such time as the transfer under the Settlement Agreement is consummated.

 

The foregoing descriptions of the Settlement Agreement, Termination Agreements, Waiver, Consulting Agreement and TSA do not purport to be complete and are qualified in their entirety by reference to the full text of the agreements, each of which is annexed hereto as Exhibits 10.1 – 10.6, respectively, and are incorporated herein by reference.

 

Reference is made to the Company’s Form 8-Ks filed on September 19, 2022 and December 13, 2022 for a complete description of the original acquisition by the Company of assets owned by the Green Tree Parties and certain other parties thereto.

 

 

Item 5.02

Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

 

On July 1, 2023, the Company terminated the employment of Allyson Feiler Downing, the Company’s Chief Marketing Officer and a member of the Company’s Board of Directors. Ms. Downing remains on the Board. Reference is made to Item 1.01 hereof for a complete description of such termination, which is incorporated by reference into this Item 5.02.

 

Item 9.01

Financial Statements and Exhibits.

 

(b)            Exhibits.

 

Exhibit No.	Description
10.1	Settlement Agreement dated July 1, 2023 by and among the Company, Allyson Feiler Downing, Loree Schwartz and certain other parties thereto.
10.2	Termination of Employment Agreement and Mutual General Release dated July 1, 2023 by and between the Company and Allyson Feiler Downing.
10.3	Termination of Employment Agreement and Mutual General Release dated July 1, 2023 by and between the Company and Loree Schwartz.
10.4	Waiver dated July 1, 2023.
10.5	Consulting Agreement dated July 1, 2023 by and among the Company, Allyson Feiler Downing and Green Tree Berthoud, LLC.
10.6	Transition Services Agreement dated July 1, 2023 by and among the Company, Green Tree Colorado LLC, Allyson Feiler Downing and Loree Schwartz.

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

Dated: July 7, 2023

 

	TREES CORPORATION
	By:	/s/ Adam Hershey
	Name:	Adam Hershey
	Title:	Interim Chief Executive Officer

 

 

Exhibit 10.1

 

SETTLEMENT AGREEMENT

 

THIS SETTLEMENT AGREEMENT (“Settlement”) is dated as of July 1, 2023 (the “Effective Date”), by and among Green Tree Colorado, LLC (“Green Tree Colorado”), Green Tree Cultivation LLC, GT Retail LLC, and Green Tree MIP LLC, each a Colorado limited liability company, TREES Corporation, a Colorado corporation and parent company to Green Tree Colorado or their respective assigns (“CANN”, and collectively with the above entities, “Trees”), Allyson Feiler Downing (“Downing”) and Loree Schwartz (“Schwartz”, and together with Downing, “Green Tree”), and for purposes of and for purposes of Section 2 and Schedule A only, Green Tree Berthoud, LLC and GT Infusions, LLC, each a Colorado limited liability company.

 

RECITALS:

 

A.

Green Tree Colorado is the owner of those assets (the “Original Assets”) of Ancient Alternatives LLC (“Ancient”), Natural Alternatives For Life, LLC, Mountainside Industries, LLC, Hillside Enterprises, LLC, and GT Creations, LLC, each a Colorado limited liability company (collectively, “Original GT Sellers”), previously acquired by Green Tree Colorado pursuant to that certain Asset Purchase Agreement dated September 13, 2022 by and among Green Tree Colorado, the Original GT Sellers, Trees, and certain other parties thereto, as amended (“APA”).

 

B.

The parties acknowledge that Trees lacks the financial means to make the remaining installment payments due to the Original GT Sellers and their respective assigns under the APA, which could be construed as an ‘anticipatory’ breach of contract under the APA.

 

C.

The parties further acknowledge that Green Tree would not expect to recover any of the remaining installment payments owed by Trees under the APA in litigation should Green Tree pursue litigation against Trees in respect thereof.

 

D.

The parties desire to completely and finally settle and resolve all potential claims, controversies, causes of action, and potential causes of action arising from Tree’s imminent default under the APA set forth in Recital (B) above.

 

In consideration of the foregoing and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

 

1.

Defined Terms. Capitalized terms used herein and not otherwise defined herein shall have the respective definitions as set forth in the APA.

 

2.

Settlement and Transfer of Transferred Assets. On the date (“Transfer Date”) on which the transfer of the cannabis licenses set forth on Schedule A from Trees to such entity set forth on Schedule A opposite such cannabis licenses has been completed and approved by the MED (the “Transfer”), Trees automatically assigns and transfers all right, title, interest, obligations and liabilities of and to the Assets set forth on Schedule A (the “Transferred Assets”) to the entities set forth above such Transferred Assets on Schedule A; except for Excluded Assets also as set forth on Schedule A, for which Trees retains in their entirety. At any time and from time to time after the Closing, at Green Tree’s written request, Trees shall execute and deliver to Green Tree such other instruments of sale, transfer, conveyance, assignment and confirmation, provide such materials and information and take such other actions as Green Tree may reasonably request in order to effect the Transfer. If Trees fails to be fulfill any above described request, then effective upon notification by Green Tree to Trees of such failure, Trees shall automatically grant Green Tree as its true and lawful proxy and attorney, with the power to act alone and with full power of substitution, to execute all documents relating to such requests on Trees’ behalf. This proxy and power granted by Trees pursuant to this Section 2 is coupled with an interest, is irrevocable, and will survive the termination of this Settlement.

 

 

3.

Consideration. In consideration for the Transferred Assets, as of the Transfer Date, each of the persons set forth on Schedule B shall sell to CANN, and CANN shall redeem from such persons the number of shares of CANN common stock as set forth opposite such persons name on Schedule B (“Redeemed Shares”). Furthermore, other than the payments to Michael Abrams pursuant to the letter agreement, dated as of the date hereof, among Green Tree, Trees and other parties thereto, as of the Effective Date, no further payments whatsoever shall be due and payable from CANN to Green Tree or any affiliate thereof under the APA or otherwise.

 

4.

Agreements Concerning Valuation and Settlement. The parties expressly agree that:

 

i.

This Settlement and the transactions contemplated hereby have been negotiated in an arms-length transaction among the parties; and

 

ii.

The Redeemed Shares are equal in value to the Transferred Assets.

 

5.

Assumption. From and after the Transfer Date, Green Tree hereby assumes any and all of Trees’ obligations and liabilities under, and in respect of, the Transferred Assets.

 

6.

TSA. Trees, Downing and Schwartz are simultaneously entering into a transition services agreement pursuant to which Downing and Schwartz shall operate the Transferred Assets from and after the Effective Date until the Transfer Date upon the terms and conditions set forth therein.

 

7.

Release; Covenant Not to Sue. Other than the parties’ indemnification obligations under this Settlement, upon the Transfer Date, each of Trees, on the one hand, and Green Tree, on the other hand, knowingly and voluntarily (for each such party, as well as, to the extent applicable, a party’s heirs, executors, administrators and assigns) releases and forever discharges the other party, its subsidiaries, affiliates and all present and former directors, officers, agents, representatives, employees, successors and assigns as well as any direct or indirect owners thereof (collectively, on behalf of either Trees or Green Tree, as applicable, the “Released Parties”) from and against any and all claims, suits, controversies, actions, causes of action, cross-claims, counter-claims, demands, debts, compensatory damages, liquidated damages, punitive or exemplary damages, other damages, claims for costs and attorneys’ fees, or liabilities of any nature whatsoever in law and in equity, both past and present (through the Transfer Date) and whether known or unknown, asserted or unasserted, direct or indirect, suspected, or claimed against a party or any Released Parties which the other party may have, which arise out of or are connected with, directly or indirectly, the APA, the Original Assets, the Transferred Assets, the transactions contemplated thereby, or any rights, obligations or liabilities in connection therewith (the “Release”). For the avoidance of doubt, notwithstanding any party’s breach of this Settlement and notwithstanding the completion of the Transfer, Trees irrevocably waives Section 5.8 of APA as it applies to Green Tree, directly or indirectly. Notwithstanding anything to the contrary herein, this Release shall not cover and shall specifically exclude Green Tree’s rights and claims directly arising out of future instances of fraud by Trees that Green Tree may have strictly in their role as shareholders of CANN. The Original GT Sellers are intended third party beneficiaries of this Release. The parties agree and acknowledge that Michael Abrams is neither a releasee or a releasor under this Release nor is he a party to this Settlement.

 

 

8.

Representations and Warranties.

 

a.

Each party that is an entity represents and warrants to the other parties that such party is in good standing, duly formed, validly existing and has all requisite power and authority to conduct its business as it is now being conducted.

 

b.

Each party has all requisite power and authority to execute and deliver this Settlement and the other instruments to be delivered upon Transfer, if any, to perform its obligations hereunder and thereunder, and to consummate the transactions contemplated hereby and thereby, subject to approvals required by the Marijuana Code. Subject to approvals required by the Marijuana Code, the execution and delivery of this Agreement and the other instruments to be delivered upon Transfer, and the performance by each party of its obligations hereunder and thereunder, have been duly and validly authorized by necessary action. This Settlement has been, and the instruments to be delivered upon Transfer, if any, will be, duly and validly executed and delivered by such party and constitute (or, in the case of instruments to be delivered at Transfer, will upon Transfer constitute) the legal, valid and binding obligation of such party enforceable against it in accordance with its terms, subject to approvals required by the Marijuana Code, except as the same may be limited by bankruptcy, insolvency, reorganization, fraudulent conveyance, arrangement, moratorium or other similar Laws relating to or affecting the rights of creditors generally.

 

c.

Trees further represents and warrants that:

 

i.

To Trees’ Knowledge, there are no Liens attaching to, or in respect of, any of the Transferred Assets.

 

ii.

There is no Proceeding pending, or to Trees’ Knowledge threatened, against Trees before or by any Governmental Authority, which seeks a writ, judgment, order or decree restraining, enjoining, or otherwise prohibiting or making illegal any of the transactions contemplated by this Settlement.

 

 

iii.

All Taxes required to be paid by Trees in respect of the Transferred Assets have been timely paid up through and including the Effective Date.

 

iv.

All accounts payable and accrued liabilities owed as of the Effective Date relating to the Transferred Assets are fully paid.

 

v.

All inventory held at NAFL Property and GTC Property (each, as defined in Schedule A below) is maintained at normal levels consistent with the ordinary course of business at each such location.

 

As used in this Settlement, “Tree’s Knowledge” shall mean knowledge, after due inquiry into the subject matter of such representation, warranty or other statement and reasonable investigation, of any of the current officers or directors of Trees’, and any other employee of Trees’ who has responsibility with respect to the relevant subject matter.

 

9.

Indemnification. Trees shall indemnify, defend and hold Green Tree harmless from and against any Claims arising out of its representations in Section 8 of this Settlement, the Transferred Assets or the operation thereof in connection with events occurring prior to the Transfer Date. Green Tree shall indemnify, defend and hold Trees harmless from and against any Claims arising out of its representations in Section 8 of this Settlement, the Transferred Assets or the operation thereof in connection with events occurring on or after the Transfer Date.

 

10.

Tax Treatment. The parties shall determine their own respective tax treatment for federal and state tax purposes. In this regard, the parties shall not be bound by the Intended Tax Treatment, and Section 5.11(g) of the APA, and any similar provisions intending to bind a party to the Intended Tax Treatment, are hereby null and void, and of no further force or effect.

 

11.

Entire Agreement. This Settlement and the APA constitute the entire agreement of the parties hereto relating to the subject matter hereof. In the event of any conflict between any provision contained herein and a provision contained in the APA, the provision contained in this Settlement shall supersede and govern in each and every respect. This Settlement may not be amended, except in a writing signed by the parties hereto.

 

12.

Governing Law. This Settlement shall be governed and construed according to the laws of the State of Colorado without giving effect to principles of conflicts or choice of laws thereof.

 

13.

Successors and Assigns. The Settlement shall be binding on and inure to the benefit of the parties to it, their successors in interest and assigns.

 

14.

Counterparts; Execution and Delivery. This Settlement may be executed by the parties hereto in separate counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute one and the same instrument. This Settlement may be executed and delivered via electronic or similar signatures.

 

[Signature page follows immediately]

 

 

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

 

TREES:
GREEN TREE COLORADO, LLC
By:	/s/ Adam Hershey
	Name:	Adam Hershey
	Title:	Interim Chief Executive Officer
TREES CORPORATION
By:	/s/ Adam Hershey
	Name:	Adam Hershey
	Title:	Interim Chief Executive Officer
GREEN TREE:
/s/ Allyson Feiler Downing
Allyson Feiler Downing
/s/ Loree Schwartz
Loree Schwartz
For purposes of Section 2 and Schedule A only:
GREEN TREE BERTHOUD, LLC
By:	/s/ Allyson Feiler Downing
	Name:	Allyson Feiler Downing
	Title:	Manager

 

 

GT INFUSIONS, LLC
By:	/s/ Allyson Feiler Downing
	Name:	Allyson Feiler Downing
	Title:	Manager

 

 

Schedule A

 

Transferred Assets

 

The following licenses in respect of the Original GT Sellers identified below:

 

Assets to be transferred to Green Tree Berthoud, LLC:

 

GT Retail, LLC f/k/a Natural Alternatives for Life, LLC – State Medical Cultivation 403-01331 

GT Retail, LLC f/k/a Natural Alternatives for Life, LLC – Berthoud Medical Cultivation 

GT Retail, LLC f/k/a Natural Alternatives for Life, LLC - State Medical Dispensary 402-00859 

GT Retail, LLC f/k/a Natural Alternatives for Life, LLC – Berthoud Medical Dispensary 

GT Retail, LLC f/k/a Natural Alternatives for Life, LLC - State Retail Dispensary 402R-00771 

GT Retail, LLC f/k/a Natural Alternatives for Life, LLC - Berthoud Retail Dispensary

 

Any and all machinery, equipment, furniture, fixtures, inventory other than inventory that is an Excluded Asset as set forth below, client information, business property and agreements of any kind, nature, character, or description, operated, owned, or leased located at 1090 North Second Street, Berthoud, Colorado 80513 (the “NAFL Location”).

 

Intellectual Property

 

GREEN TREE MEDICINALS (Design), U.S. Serial No. 88490001, International Class 41: “educational services, namely, providing online instruction in the field of the history of cannabis; providing information, news, and commentary in the field of current events relating to cannabis, marijuana, and hemp; providing information in the field of the history of cannabis including its origins.” It was filed in the name of Natural Alternatives for Life, LLC, having an address of 854 Terrace Circle North, Boulder, CO 80304 and has been used since 2012. FILING RECEIPT: Trademark for GREEN TREE MEDICINALS: 56323.0004 Serial number 88490001 [IWOV-Active.FID12190557] on June 27,

 

2019

 

GREEN TREE MEDICINALS (Design), U.S. Serial No. 88490011, International Class 5: “Retail store services featuring hemp oil; Retail store services featuring body oils, massage oils, skin creams, body care products, salves, serums, creams, and oil for therapeutic purposes; all of the foregoing containing hemp oil or cannabidiol derived from hemp.” It was filed in the name of Natural Alternatives for Life, LLC, having an address of 854 Terrace Circle North, Boulder, CO 80304 and has been used since 2012. FILING RECEIPT: GREEN TREE MEDICINALS Trademark Application: 56323.0005 Serial number 88490011 [IWOV-Active.FID12190557] on June 27, 2019

 

Domain name is: www.GreenTreeMedicinals.com Host: GoDaddy.com

 

 

Assets to be transferred to GT Infusions, LLC:

 

GT MIP, LLC f/k/a GT Creations, LLC - State Medical MIP 404-00626 

GT MIP, LLC f/k/a GT Creations, LLC – Boulder County Medical MIP MMB-18-0001 

GT MIP, LLC f/k/a GT Creations, LLC - State Retail MIP 404R-00403 

GT MIP, LLC f/k/a GT Creations, LLC – Boulder County Retail MIP RMB-18-0005

 

Any and all machinery, equipment, furniture, fixtures, inventory, client information, business property and agreements of any kind, nature, character, or description, operated, owned, or leased located at 6859 North Foothills Highway, E-200, Boulder, CO 80302 (the “GTC Location”).

 

Excluded Assets

 

Trees will retain:

 

	●	All accounts payable and accrued liabilities prior to the Effective Date
	●	Finished, tested, ready for transfer cannabis material from the Berthoud grow

 

 

Schedule B

 

Share Redemption

 

Redeemed Shares:

 

Shareholder		Common Stock Redeemed
Allyson Feiler Downing		5,071,147
Loree Schwartz		4,846,427

 

Exhibit 10.2

 

TERMINATION OF EMPLOYMENT AGREEMENT AND 

MUTUAL GENERAL RELEASE

 

THIS TERMINATION OF EMPLOYMENT AGREEMENT AND MUTUAL GENERAL RELEASE (“Termination”) is entered into as of July 1, 2023 (“Effective Date”), by and between Allyson Feiler Downing, an individual (“Employee”), and TREES Corporation, a Colorado corporation (the “Company).

 

WHEREAS, Employee has served as the Chief Marketing Officer of the Company pursuant to an Employment Agreement dated December 12, 2022 by and between the Company and Employee (“Employment Agreements”); and

 

WHEREAS, the parties wish to terminate the Employment Agreement and provide the mutual releases as set forth herein.

 

NOW, THEREFORE, in consideration of the mutual promises, agreements and covenants contained herein, and for other valuable consideration, receipt of which is hereby acknowledged, the parties, intending to be legally bound, agree as follows:

 

1.            Employee and the Company hereby mutually agree that as of the Effective Date, the Employment Agreement and any other agreements or understandings concerning Employee’s employment with the Company, whether written or oral, and any rights contained therein, are terminated and of no further force or effect, and no party shall have any further obligations, restrictions or liabilities thereunder, including, without limitation, any obligations, restrictions or liabilities under Sections 6, 8, 9, 22, and 24, provided, that the Company retains the obligation to pay Base Salary (as defined in the Employment Agreement) up through and including the Effective Date. Furthermore, Employee’s employment with the Company shall end as of the Effective Date. Employee agrees that Employee does hereby release and forever discharge as of the date hereof the Company, its subsidiaries and their respective affiliates and all present and former directors, officers, agents, representatives, employees, successors and assigns of the Company, its subsidiaries and their respective affiliates and the Company’s direct or indirect owners (collectively, the “Company Released Parties”, and together with the Employee Released Parties, the “Released Parties”), as provided below. For the avoidance of doubt, the Company and its subsidiaries, affiliates and assigns irrevocably waive Section 5.8 of the Asset Purchase Agreement, dated September 13, 2021, by and among Employee, the Company and other parties thereto as it applies to Employee, directly or indirectly.

 

2.            Except as provided in paragraph 5 below which expressly survives the termination of Employee’s employment with the Company, Employee knowingly and voluntarily (for herself, Employee’s heirs, executors, administrators and assigns) releases and forever discharges the Company, its parent and subsidiaries and the other Company Released Parties from any and all claims, suits, controversies, actions, causes of action, cross-claims, counter-claims, demands, debts, compensatory damages, liquidated damages, punitive or exemplary damages, other damages, claims for costs and attorneys’ fees, or liabilities of any nature whatsoever in law and in equity, both past and present (through the date this Termination becomes effective and enforceable) and whether known or unknown, asserted or unasserted, direct or indirect, suspected, or claimed against the Company, its parent and subsidiaries or any of the Company Released Parties which Employee, Employee’s spouse, or any of Employee’s heirs, executors, administrators or assigns, may have, which arise out of Employee’s employment with, or Employee’s separation or termination from, the Company (including, but not limited to, any allegation, claim or violation, arising under: Title VII of the Civil Rights Act of 1964, as amended, including without limitation, the Pregnancy Discrimination Act contained therein; the Civil Rights Act of 1991; the Age Discrimination in Employment Act of 1967, as amended (including the Older Workers Benefit Protection Act); the Equal Pay Act of 1963, as amended; the Americans with Disabilities Act of 1990; the Family and Medical Leave Act of 1993; the Worker Adjustment Retraining and Notification Act; the Employee Retirement Income Security Act of 1974; the Fair Labor Standards Act; or their state or local counterparts; or under any other federal, state or local civil or human rights law, or under any other local, state, or federal law, regulation or ordinance; or under any public policy, contract or tort, or under common law; or arising under any policies, practices or procedures of the Company; or any claim for wrongful discharge, breach of the Employment Agreement, infliction of emotional distress, defamation; or any claim for costs, fees, or other expenses, including attorneys’ fees incurred in these matters) (all of the foregoing collectively referred to herein as the “Claims”); provided, however, that, notwithstanding anything to the contrary contained herein, Employee shall not release or discharge any Company Released Party from any breach of this Termination and Employee’s Claims and this Termination shall not cover and shall specifically exclude Employee’s rights and claims, directly or indirectly, arising from or under or related to any rights of indemnification or contribution, whether pursuant to the Company’s certificate of incorporation, bylaws, or D&O insurance policies or applicable law arising during Employee’s time of service as an employee or member of the Board of the Company.

 

 

3.            Employee represents that Employee has made no assignment or transfer of any right, claim, demand, cause of action, or other matter covered by paragraph 2 above.

 

4.            Employee specifically releases all claims against the Company Released Parties under the Age Discrimination in Employment Act (“ADEA”) relating to Employee’s employment and its termination.

 

5.            The parties expressly consent that this Termination shall be given full force and effect according to all of its express terms and provisions, including those relating to unknown and unsuspected Claims (notwithstanding any state statute that expressly limits the effectiveness of a general release of unknown, unsuspected and unanticipated Claims), if any, as well as those relating to any other Claims hereinabove mentioned. The parties acknowledge and agree that this waiver is an essential and material term of this Termination. Each party further agrees that in the event that such party should bring a Claim seeking damages against a Released Party, or in the event such party should seek to recover against any Released Party in any Claim brought by a governmental agency on such party’s behalf, this Termination shall serve as a complete defense to such Claims. Each party further agrees that such party is not aware of any pending charge or complaint of the type described in paragraphs 2 or 10, as applicable, as of the execution of this Termination.

 

6.            Employee agrees that neither this Termination, nor the furnishing of the consideration for this Termination, shall be deemed or construed at any time to be an admission by either party or any Released Party of any improper or unlawful conduct.

 

 

7.            Each party agrees that such party shall not challenge the validity of this Termination except as otherwise permitted under law. In the event of any such lawsuit, the prevailing party shall be entitled to recover from the losing party the costs and expenses of the lawsuit, including reasonable attorneys’ fees.

 

8.            Both parties agree not to disclose any terms of this Termination, except that the Company may disclose this Termination or any terms thereof as may be required in its discretion by applicable law, rule or regulation. Employee may disclose such terms to Employee’s immediate family and to any tax, legal or other counsel that Employee has consulted regarding the meaning or effect hereof or as required by law, and Employee will instruct each of the foregoing not to disclose the same to anyone. Notwithstanding the above, Employee shall be allowed to confirm with other persons the occurrence of the termination of her employment with the Company.

 

9.            Employee represents that Employee has not filed or caused to be filed against any of the Released Parties, individually or collectively, any lawsuit, complaint, charge, proceeding, or the like, before any local, state, or federal agency, court, or other body (each, a “Proceeding”), and Employee covenants and agrees that Employee will not do so at any time hereafter with respect to the Claims released pursuant to this Termination (including, without limitation, any claims relating to the termination of Employee’s employment), except as may be necessary to enforce this Termination, to seek a determination of the validity of the waiver of Employee’s rights under the ADEA, or to initiate or participate in an investigation or proceeding conducted by the Equal Employment Opportunity Commission (“EEOC”) or other governmental agency as permitted by law. Except as otherwise provided in the preceding sentence, (i) Employee will not initiate or cause to be initiated on Employee’s behalf any Proceeding, and will not participate (except as required to do so by law) in any Proceeding that would be the subject of a Claim under Paragraph 2, and (ii) Employee waives any right Employee may have to benefit in any manner from any relief (monetary or otherwise) arising out of any such Proceeding.

 

10.          The Company, on behalf of itself and the Released Parties, does hereby release and forever discharge as of the Effective Date Employee, as well as her heirs, executors, administrators and assigns (“Employee Released Parties”), from and against any and all Claims, to the extent any such Claims are applicable provided, however, that, notwithstanding anything to the contrary contained herein, the Company shall not release or discharge any Employee Released Party from any breach of this Termination. The Company represents that it has made no assignment or transfer of any right, claim, demand, cause of action, or other matter covered by this paragraph.

 

11.          The Company represents that it has not filed or caused to be filed against any of the Employee Released Parties, individually or collectively, any Proceeding, and the Company covenants and agrees that the Company will not do so at any time hereafter with respect to the Claims released pursuant to this Termination (including, without limitation, any claims relating to the termination of Employee’s employment), except as may be necessary to enforce this Termination, to seek a determination of the validity of the waiver of Employee’s rights under the ADEA, or to initiate or participate in an investigation or proceeding conducted by the EEOC or other governmental agency as permitted by law. Except as otherwise provided in the preceding sentence, (i) the Company will not initiate or cause to be initiated on the Company’s behalf any Proceeding, and will not participate (except as required to do so by law) in any Proceeding that would be the subject of a Claim under Paragraph 10, and (ii) the Company waives any right it may have to benefit in any manner from any relief (monetary or otherwise) arising out of any Proceeding.

 

 

12.          Each of Employee and the Company agree not to, and the Company agrees not to allow its executives and board members to, at any time, make, publish or communicate to any other person or entity any defamatory remarks or statements concerning the Company or Employee, as the case may be. This paragraph does not in any way restrict or impede either party from exercising protected rights or from complying with any applicable law, rule or regulation or court order.

 

13.          Whenever possible, each provision of this Termination shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Termination is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other provision or any other jurisdiction, but this Termination shall be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein.

 

14.          BY SIGNING THIS TERMINATION, EMPLOYEE REPRESENTS AND AGREES (EXCEPT AS SET FORTH BELOW) THAT:

 

EMPLOYEE HAS READ THIS TERMINATION CAREFULLY;

 

EMPLOYEE UNDERSTANDS ALL OF THE TERMS OF THE RELEASE AND KNOWS THAT IT IS GIVING UP IMPORTANT RIGHTS, INCLUDING BUT NOT LIMITED TO, RIGHTS UNDER THE AGE DISCRIMINATION IN EMPLOYMENT ACT OF 1967, AS AMENDED, TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, AS AMENDED; THE EQUAL PAY ACT OF 1963, THE AMERICANS WITH DISABILITIES ACT OF 1990; AND THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED;

 

EACH PARTY VOLUNTARILY CONSENTS TO EVERYTHING IN THIS TERMINATION;

 

EMPLOYEE HAS BEEN ADVISED TO CONSULT WITH AN ATTORNEY BEFORE EXECUTING THIS TERMINATION AND EMPLOYEE HAS DONE SO OR, AFTER CAREFUL READING AND CONSIDERATION EMPLOYEE HAS CHOSEN NOT TO DO SO OF EMPLOYEE’S OWN VOLITION;

 

EMPLOYEE UNDERSTANDS THAT EMPLOYEE HAS SEVEN DAYS AFTER THE EXECUTION OF THIS TERMINATION TO REVOKE IT AND THAT THIS TERMINATION SHALL NOT BECOME EFFECTIVE OR ENFORCEABLE UNTIL SUCH REVOCATION PERIOD HAS EXPIRED;

 

EMPLOYEE HAS SIGNED THIS TERMINATION KNOWINGLY AND VOLUNTARILY AND WITH THE ADVICE OF ANY COUNSEL RETAINED TO ADVISE EMPLOYEE WITH RESPECT TO IT; AND

 

EMPLOYEE AGREES THAT THE PROVISIONS OF THIS TERMINATION MAY NOT BE AMENDED, WAIVED, CHANGED OR MODIFIED EXCEPT BY AN INSTRUMENT IN WRITING SIGNED BY AN AUTHORIZED REPRESENTATIVE OF THE COMPANY AND BY EMPLOYEE.

 

15.          The Company voluntarily consents to everything in this Termination, and agrees that the provisions of this Termination may not be amended, waived, changed or modified except by an instrument in writing signed by an authorized representation of the Company and by Employee.

 

 

This Termination shall not become effective until the eighth (8th) day following Employee’s execution of it; provided, that Company may not unilaterally revoke this Termination after Employee’s execution of it.

 

IN WITNESS WHEREOF, the undersigned parties have executed and delivered this Termination as of the date set forth below.

 

		Employee:
		/s/ Allyson Feiler Downing
		Allyson Feiler Downing
		Date:

 

TREES CORPORATION
By:	/s/ Adam Hershey
	Adam Hershey
	Interim CEO
Date:

 

 

Exhibit 10.3

 

TERMINATION OF EMPLOYMENT AGREEMENT AND 

MUTUAL GENERAL RELEASE

 

THIS TERMINATION OF EMPLOYMENT AGREEMENT AND MUTUAL GENERAL RELEASE (“Termination”) is entered into as of July 1, 2023 (“Effective Date”), by and between LOREE SCHWARTZ, an individual (“Employee”), and TREES Corporation, a Colorado corporation (the “Company).

 

WHEREAS, Employee has served as the Chief Marketing Officer of the Company pursuant to an Employment Agreement dated December 12, 2022 by and between the Company and Employee (“Employment Agreements”); and

 

WHEREAS, the parties wish to terminate the Employment Agreement and provide the mutual releases as set forth herein.

 

NOW, THEREFORE, in consideration of the mutual promises, agreements and covenants contained herein, and for other valuable consideration, receipt of which is hereby acknowledged, the parties, intending to be legally bound, agree as follows:

 

1.            Employee and the Company hereby mutually agree that as of the Effective Date, the Employment Agreement and any other agreements or understandings concerning Employee’s employment with the Company, whether written or oral, and any rights contained therein, are terminated and of no further force or effect, and no party shall have any further obligations, restrictions or liabilities thereunder, including, without limitation, any obligations, restrictions or liabilities under Sections 6, 8, 9, 22, and 24, provided, that the Company retains the obligation to pay Base Salary (as defined in the Employment Agreement) up through and including the Effective Date. Furthermore, Employee’s employment with the Company shall end as of the Effective Date. Employee agrees that Employee does hereby release and forever discharge as of the date hereof the Company, its subsidiaries and their respective affiliates and all present and former directors, officers, agents, representatives, employees, successors and assigns of the Company, its subsidiaries and their respective affiliates and the Company’s direct or indirect owners (collectively, the “Company Released Parties”, and together with the Employee Released Parties, the “Released Parties”), as provided below. For the avoidance of doubt, the Company and its subsidiaries, affiliates and assigns irrevocably waive Section 5.8 of the Asset Purchase Agreement, dated September 13, 2021, by and among Employee, the Company and other parties thereto as it applies to Employee, directly or indirectly.

 

 

2.            Except as provided in paragraph 5 below which expressly survives the termination of Employee’s employment with the Company, Employee knowingly and voluntarily (for herself, Employee’s heirs, executors, administrators and assigns) releases and forever discharges the Company, its parent and subsidiaries and the other Company Released Parties from any and all claims, suits, controversies, actions, causes of action, cross-claims, counter-claims, demands, debts, compensatory damages, liquidated damages, punitive or exemplary damages, other damages, claims for costs and attorneys’ fees, or liabilities of any nature whatsoever in law and in equity, both past and present (through the date this Termination becomes effective and enforceable) and whether known or unknown, asserted or unasserted, direct or indirect, suspected, or claimed against the Company, its parent and subsidiaries or any of the Company Released Parties which Employee, Employee’s spouse, or any of Employee’s heirs, executors, administrators or assigns, may have, which arise out of Employee’s employment with, or Employee’s separation or termination from, the Company (including, but not limited to, any allegation, claim or violation, arising under: Title VII of the Civil Rights Act of 1964, as amended, including without limitation, the Pregnancy Discrimination Act contained therein; the Civil Rights Act of 1991; the Age Discrimination in Employment Act of 1967, as amended (including the Older Workers Benefit Protection Act); the Equal Pay Act of 1963, as amended; the Americans with Disabilities Act of 1990; the Family and Medical Leave Act of 1993; the Worker Adjustment Retraining and Notification Act; the Employee Retirement Income Security Act of 1974; the Fair Labor Standards Act; or their state or local counterparts; or under any other federal, state or local civil or human rights law, or under any other local, state, or federal law, regulation or ordinance; or under any public policy, contract or tort, or under common law; or arising under any policies, practices or procedures of the Company; or any claim for wrongful discharge, breach of the Employment Agreement, infliction of emotional distress, defamation; or any claim for costs, fees, or other expenses, including attorneys’ fees incurred in these matters) (all of the foregoing collectively referred to herein as the “Claims”); provided, however, that, notwithstanding anything to the contrary contained herein, Employee shall not release or discharge any Company Released Party from any breach of this Termination and Employee’s Claims and this Termination shall not cover and shall specifically exclude Employee’s rights and claims, directly or indirectly, arising from or under or related to any rights of indemnification or contribution, whether pursuant to the Company’s certificate of incorporation, bylaws, or D&O insurance policies or applicable law arising during Employee’s time of service as an employee or member of the Board of the Company.

 

3.            Employee represents that Employee has made no assignment or transfer of any right, claim, demand, cause of action, or other matter covered by paragraph 2 above.

 

4.            Employee specifically releases all claims against the Company Released Parties under the Age Discrimination in Employment Act (“ADEA”) relating to Employee’s employment and its termination.

 

5.            The parties expressly consent that this Termination shall be given full force and effect according to all of its express terms and provisions, including those relating to unknown and unsuspected Claims (notwithstanding any state statute that expressly limits the effectiveness of a general release of unknown, unsuspected and unanticipated Claims), if any, as well as those relating to any other Claims hereinabove mentioned. The parties acknowledge and agree that this waiver is an essential and material term of this Termination. Each party further agrees that in the event that such party should bring a Claim seeking damages against a Released Party, or in the event such party should seek to recover against any Released Party in any Claim brought by a governmental agency on such party’s behalf, this Termination shall serve as a complete defense to such Claims. Each party further agrees that such party is not aware of any pending charge or complaint of the type described in paragraphs 2 or 10, as applicable, as of the execution of this Termination.

 

6.            Employee agrees that neither this Termination, nor the furnishing of the consideration for this Termination, shall be deemed or construed at any time to be an admission by either party or any Released Party of any improper or unlawful conduct.

 

 

7.            Each party agrees that such party shall not challenge the validity of this Termination except as otherwise permitted under law. In the event of any such lawsuit, the prevailing party shall be entitled to recover from the losing party the costs and expenses of the lawsuit, including reasonable attorneys’ fees.

 

8.            Both parties agree not to disclose any terms of this Termination, except that the Company may disclose this Termination or any terms thereof as may be required in its discretion by applicable law, rule or regulation. Employee may disclose such terms to Employee’s immediate family and to any tax, legal or other counsel that Employee has consulted regarding the meaning or effect hereof or as required by law, and Employee will instruct each of the foregoing not to disclose the same to anyone. Notwithstanding the above, Employee shall be allowed to confirm with other persons the occurrence of the termination of her employment with the Company.

 

9.            Employee represents that Employee has not filed or caused to be filed against any of the Released Parties, individually or collectively, any lawsuit, complaint, charge, proceeding, or the like, before any local, state, or federal agency, court, or other body (each, a “Proceeding”), and Employee covenants and agrees that Employee will not do so at any time hereafter with respect to the Claims released pursuant to this Termination (including, without limitation, any claims relating to the termination of Employee’s employment), except as may be necessary to enforce this Termination, to seek a determination of the validity of the waiver of Employee’s rights under the ADEA, or to initiate or participate in an investigation or proceeding conducted by the Equal Employment Opportunity Commission (“EEOC”) or other governmental agency as permitted by law. Except as otherwise provided in the preceding sentence, (i) Employee will not initiate or cause to be initiated on Employee’s behalf any Proceeding, and will not participate (except as required to do so by law) in any Proceeding that would be the subject of a Claim under Paragraph 2, and (ii) Employee waives any right Employee may have to benefit in any manner from any relief (monetary or otherwise) arising out of any such Proceeding.

 

10.            The Company, on behalf of itself and the Released Parties, does hereby release and forever discharge as of the Effective Date Employee, as well as her heirs, executors, administrators and assigns (“Employee Released Parties”), from and against any and all Claims, to the extent any such Claims are applicable provided, however, that, notwithstanding anything to the contrary contained herein, the Company shall not release or discharge any Employee Released Party from any breach of this Termination. The Company represents that it has made no assignment or transfer of any right, claim, demand, cause of action, or other matter covered by this paragraph.

 

11.            The Company represents that it has not filed or caused to be filed against any of the Employee Released Parties, individually or collectively, any Proceeding, and the Company covenants and agrees that the Company will not do so at any time hereafter with respect to the Claims released pursuant to this Termination (including, without limitation, any claims relating to the termination of Employee’s employment), except as may be necessary to enforce this Termination, to seek a determination of the validity of the waiver of Employee’s rights under the ADEA, or to initiate or participate in an investigation or proceeding conducted by the EEOC or other governmental agency as permitted by law. Except as otherwise provided in the preceding sentence, (i) the Company will not initiate or cause to be initiated on the Company’s behalf any Proceeding, and will not participate (except as required to do so by law) in any Proceeding that would be the subject of a Claim under Paragraph 10, and (ii) the Company waives any right it may have to benefit in any manner from any relief (monetary or otherwise) arising out of any Proceeding.

 

 

12.            Each of Employee and the Company agree not to, and the Company agrees not to allow its executives and board members to, at any time, make, publish or communicate to any other person or entity any defamatory remarks or statements concerning the Company or Employee, as the case may be. This paragraph does not in any way restrict or impede either party from exercising protected rights or from complying with any applicable law, rule or regulation or court order.

 

13.            Whenever possible, each provision of this Termination shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Termination is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other provision or any other jurisdiction, but this Termination shall be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein.

 

14.            BY SIGNING THIS TERMINATION, EMPLOYEE REPRESENTS AND AGREES (EXCEPT AS SET FORTH BELOW) THAT:

 

EMPLOYEE HAS READ THIS TERMINATION CAREFULLY;

 

EMPLOYEE UNDERSTANDS ALL OF THE TERMS OF THE RELEASE AND KNOWS THAT IT IS GIVING UP IMPORTANT RIGHTS, INCLUDING BUT NOT LIMITED TO, RIGHTS UNDER THE AGE DISCRIMINATION IN EMPLOYMENT ACT OF 1967, AS AMENDED, TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, AS AMENDED; THE EQUAL PAY ACT OF 1963, THE AMERICANS WITH DISABILITIES ACT OF 1990; AND THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED;

 

EACH PARTY VOLUNTARILY CONSENTS TO EVERYTHING IN THIS TERMINATION;

 

EMPLOYEE HAS BEEN ADVISED TO CONSULT WITH AN ATTORNEY BEFORE EXECUTING THIS TERMINATION AND EMPLOYEE HAS DONE SO OR, AFTER CAREFUL READING AND CONSIDERATION EMPLOYEE HAS CHOSEN NOT TO DO SO OF EMPLOYEE’S OWN VOLITION;

 

EMPLOYEE UNDERSTANDS THAT EMPLOYEE HAS SEVEN DAYS AFTER THE EXECUTION OF THIS TERMINATION TO REVOKE IT AND THAT THIS TERMINATION SHALL NOT BECOME EFFECTIVE OR ENFORCEABLE UNTIL SUCH REVOCATION PERIOD HAS EXPIRED;

 

EMPLOYEE HAS SIGNED THIS TERMINATION KNOWINGLY AND VOLUNTARILY AND WITH THE ADVICE OF ANY COUNSEL RETAINED TO ADVISE EMPLOYEE WITH RESPECT TO IT; AND

 

EMPLOYEE AGREES THAT THE PROVISIONS OF THIS TERMINATION MAY NOT BE AMENDED, WAIVED, CHANGED OR MODIFIED EXCEPT BY AN INSTRUMENT IN WRITING SIGNED BY AN AUTHORIZED REPRESENTATIVE OF THE COMPANY AND BY EMPLOYEE.

 

15.            The Company voluntarily consents to everything in this Termination, and agrees that the provisions of this Termination may not be amended, waived, changed or modified except by an instrument in writing signed by an authorized representation of the Company and by Employee.

 

 

This Termination shall not become effective until the eighth (8th) day following Employee’s execution of it; provided, that Company may not unilaterally revoke this Termination after Employee’s execution of it.

 

IN WITNESS WHEREOF, the undersigned parties have executed and delivered this Termination as of the date set forth below.

 

		Employee:
		/s/ Loree Schwartz
		Loree Schwartz
		Date:

 

TREES CORPORATION
By:	/s/ Adam Hershey
	Adam Hershey
	Interim CEO
Date:

 

Exhibit 10.4

 

Trees Corporation 215 Union Boulevard, Suite 415  Lakewood, CO 80228

 

July 1, 2023

 

Allyson Feiler Downing 

Loree Schwartz

 

Re:      Waiver (Non-Compete; Non-Solicit)

 

Each of TREES Corporation (“CANN”) and Green Tree Colorado, LLC (“Buyer”, and together with CANN, “Trees”) acknowledge and agree to, effective upon the execution of this letter agreement, irrevocably waive Section 5.8 of the Asset Purchase Agreement, dated as of September 13, 2022, as amended, by and among Trees, Allyson Feiler Downing (“Downing”), Loree Schwartz (“Schwartz”) and various other parties thereto as such section applies to Downing and Schwartz, directly or indirectly (the “Waiver”).

 

		Sincerely,
		TREES Corporation
		By:	/s/ Adam Hershey
			Adam Hershey
			Interim CEO
		Green Tree Colorado, LLC
		By:	/s/ Adam Hershey
			Adam Hershey
			Interim CEO

 

Agreed and Acknowledged:
Allyson Feiler Downing
/s/ Allyson Feiler Downing
Loree Schwartz
/s/ Loree Schwartz

 

 

Exhibit 10.5

 

CONSULTING AGREEMENT

 

This Consulting Agreement (“Agreement”) dated as of July 1, 2023, is entered into by and between Green Tree Berthoud, LLC, a Colorado limited liability company having an address at 1090 N. 2^nd St., Berthoud CO 80513 the (“Company”), and TREES Corporation, having an address at 215 Union Boulevard, Suite 415, Lakewood, CO 80228 (“Consultant”).

 

WHEREAS, the Company is desirous of retaining Consultant, and Consultant desires to be retained, to provide certain services to the Company as set forth in this Agreement.

 

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

 

1.

Agreement to Provide Services. The Company hereby retains Consultant, and Consultant hereby agrees to furnish to the Company, as an independent contractor, cannabis-related business and cultivation consulting services, on an as-needed basis (the “Services”). Consultant will perform the Services in a good and workmanlike manner, and in accordance with the professional standards and practices normally exercised by professional consultants performing services of a similar nature. Consultant shall also conduct its activities in accordance with all relevant laws, regulations, decrees and/or official government rules and orders.

 

2.

Limitations. In performing the Services, it is expressly agreed by Consultant that Consultant shall have no authority to, and shall not, represent itself as having the power, right or authority to represent or enter into any obligations or commitments whatsoever on behalf of, or as agent for the Company. Consultant shall conduct its affairs with regard to third parties to avoid the appearance or creation of any relationship between Consultant and the Company, other than that of an independent contractor, as provided for herein. Consultant shall have no authority to, and shall not, take or permit the taking of any actions the taking of which, or omit to take or permit the omission of any actions the omission of which, would give rise to any liability on the part of the Company or any of its officers, managers, members, employees, or agents. Consultant shall not in any manner identify or represent its office facilities as being the office facilities or other place of business of the Company. Consultant shall not have the authority to engage any sub-contractors or subconsultants in relation to the Services to be provided hereunder, including investigators, consultants, experts or legal counsel, without the Company’s prior approval.

 

3.

Compensation. In consideration for the Services to be provided under this Agreement by Consultant, the Company hereby agrees to pay Consultant consulting fees equal to an aggregate of $289,452.39 (“Consulting Fees”), payable in ten (10) equal monthly installments commencing on the first full month following completion of payment by Consultant to Michael Abrams (“Abrams”) of an aggregate of $562,380.95 (the “Abrams Payment”) pursuant to that certain Asset Purchase Agreement dated as of September 13, 2022, as amended, by and among Consultant, Abrams, Green Tree Colorado, LLC, a Colorado limited liability company and certain other parties thereto. Without limiting the forgoing, Company and Consultant acknowledge and agree that no Consulting Fees shall be paid unless and until the Abrams Payment has been fully received by Abrams from Consultant.

 

 

4.

Term. This Agreement shall remain in full force and effect until such time as the Consulting Fees have been paid in full; provided, that (i) the Company may terminate this Agreement upon written notice to Consultant if Consultant has not made the Abrams Payment within 39 months of the date of this Agreement or (ii) this Agreement shall automatically terminate if the Transferred Assets under the Settlement Agreement, dated as of the hereof, by and among the Company, Consultant and other parties thereto, have not been successfully transferred pursuant to such Settlement Agreement by December 31, 2023.

 

5.

Security Interest. As a continuing security interest for payment in full of the Consulting Fees by the Company hereunder, Allyson Feiler Downing (“Downing”) shall promptly as of the date hereof deposit into escrow 324,719 shares of the Company’s Common Stock owned by Downing (“Secured Shares”) with an escrow agent mutually agreeable to the parties, which Secured Shares shall be returned to Downing upon the earlier of the full payment of all Consulting Fees hereunder or termination of this Consulting Agreement. Unless this Consulting Agreement is earlier terminated, in the event that full payment of all Consulting Fees has not occurred as and when due as set forth in Paragraph 3 above, the Company shall be entitled to permanently retain any Secured Shares to satisfy the full balance of any Consulting Fees then outstanding. For purposes hereof, all Secured Shares shall be valued at $0.89 per share.

 

6.

Governing Law; Jurisdiction. This Agreement shall be governed by and construed in accordance with the laws of the State of Colorado without giving effect to principles of conflicts or choice of laws thereof; federal and state courts located in the State of Colorado shall have exclusive jurisdiction with respect to any dispute or proceeding arising out of or relating to this Agreement, and the Company and Consultant hereby submit to the exclusive jurisdiction of such courts.

 

7.

Notices. All notices to be provided pursuant to this Agreement (and any consents permitted by the terms of this Agreement) shall be in writing and delivered by hand, or sent by overnight courier or registered mail, return receipt requested to the address as set forth on the first page of this Agreement or such other address as may be properly noticed; or via email.

 

8.

Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns, including in the case of individuals, their heirs, executors and administrators.

 

 

9.

Amendment. Except by an instrument in writing signed by the parties, this Agreement may not be amended or modified in any respect, except upon mutual written agreement between the Company and Consultant.

 

10.

Entire Agreement. This Agreement sets forth the entire agreement of the parties hereto as to the subject matter hereof and supersedes all previous agreements between the parties, whether written, oral or otherwise.

 

11.

No Waiver. It is understood and agreed that no failure or delay by a party in exercising any right, power or privilege hereunder shall operate as a waiver thereof by such party, nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any right, power or privilege hereunder.

 

12.

Relationship Between Consultant and the Company. The relationship of Consultant to the Company under this Agreement shall be that of independent contractor. Except to the extent that the Company may from time to time give Consultant specific authorization to enter into specific commitments with third parties for or on behalf of the Company, Consultant shall have no authority to and shall not represent himself as having the power, right or authority to represent or enter into any obligations or commitments whatsoever on behalf of or as agent for the Company. No provision of this Agreement is intended to or shall be construed as creating an employment, mutual agency, joint venture, partnership or other fiduciary relationship between the parties hereto, or as entitling Consultant or any of its agents or affiliates to any compensation or benefits as an employee, except as expressly provided in this Agreement. The Company expressly agrees and acknowledges that Consultant is permitted to commence or continue with other business activities, provided such activities do not conflict with this Agreement.

 

13.

Signing in Counterparts; Email Delivery. This Agreement may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same document. Transmission by email scan shall be sufficient for delivery hereof.

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first written above.

 

		Company:
		GREEN TREE BERTHOUD, LLC
		By:	/s/ Allyson Feiler Downing
			Allyson Feiler Downing
			Manager
		Consultant:
		TREES CORPORATION
		By:	/s/ Adam Hershey
			Name:	Adam Hershey
			Title:	Interim Chief Executive Officer

 

The undersigned agrees and acknowledges, and agrees to be personally bound by, all terms and conditions of Paragraphs 3 and 5 of this Agreement:

 

/s/ Allyson Feiler Downing
Allyson Feiler Downing

 

Exhibit 10.6

 

Transition Services Agreement

 

This Transition Services Agreement (“Agreement”) is made as of July 1, 2023 (the “Effective Date”), by and among Allyson Feiler Downing and Loree Schwartz (together, “SERVICE PROVIDER”) and Green Tree Colorado, LLC, a Colorado limited liability company and TREES Corporation, a Colorado corporation (together “CLIENT” and together with the SERVICE PROVIDER, the “Parties”).

 

A.

CLIENT desires to engage the services of SERVICE PROVIDER, and SERVICE PROVIDER desires to perform, certain administrative and management services involving the businesses located at 1090 N. 2nd St, Berthoud CO 80513 and 6859 N Foothills Hwy, E-200, Boulder CO 80302 (collectively, the “Business”).

 

B.

The Business includes two Regulated Marijuana Businesses as defined in the Colorado “Marijuana Code,” collectively, Sections 14 and 16, Article XVIII of the Constitution of the State of Colorado, C.R.S, §§ 44-10-101, et seq., and all regulations and ordinances promulgated thereunder by the Colorado Marijuana Enforcement Division and the relevant local licensing authorities.

 

C.

On the Effective Date, each individual comprising SERVICE PROVIDER is registered with the Colorado Marijuana Enforcement Division as a Controlling Beneficial Owner of the Business pursuant to the Marijuana Code.

 

In consideration of the mutual promises and undertakings of the Parties, and for other good and valuable consideration, receipt of which is hereby acknowledged, SERVICE PROVIDER and CLIENT agree as follows:

 

1.

SERVICES. SERVICE PROVIDER will perform the services set forth in Exhibit A attached hereto (collectively, the “Services”) for CLIENT during the Term. SERVICE PROVIDER shall determine the manner and means of performing the Services.

 

2.

FEES AND PAYMENT

 

2.1.

Fees. In exchange for its provision of the Services, SERVICE PROVIDER shall retain 100% of the revenue generated from the Business (the “TSA Fee”). CLIENT and SERVICE PROVIDER agree that during the Term of this Agreement, SERVICE PROVIDER need not remit any of the Business’ revenues to CLIENT, unless required by applicable law. Commencing on the Effective Date, SERVICE PROVIDER shall assume all liabilities related to the assets and operation of the Business accruing from and after the Effective Date until the termination of this Agreement. In the event that CLIENT is required by applicable law to, or actually does pay any liability or collect any revenue of the Business, then SERVICE PROVIDER and CLIENT shall work together in good faith to provide a monthly accounting of such Business liabilities and revenue and, within five (5) days of finalization of such accounting, SERVICE PROVIDER shall reimburse CLIENT for such agreed upon Business liabilities and CLIENT shall reimburse SERVICE PROVIDER for such agreed upon Business revenue.

 

2.2.

Payment Terms. All payments must be made in U.S. dollars. Any outstanding balances owed by CLIENT to SERVICE PROVIDER shall accrue interest at a rate equal to the lesser of 1.5% per month and the maximum rate permitted by applicable law, from due date until paid, plus SERVICE PROVIDER’s reasonable costs of collection. All fees due hereunder are exclusive of, and CLIENT shall pay, all real property tax, business personal property tax, use and other taxes, export and import fees, customs duties and similar charges applicable to the transactions contemplated by this Agreement, except for taxes based upon SERVICE PROVIDER’s revenue. CLIENT agrees to indemnify and hold SERVICE PROVIDER harmless from and against all claims, liabilities, costs, expenses and penalties arising out of or related to CLIENT’s failure to timely report or pay any such taxes, fees, duties or charges. SERVICE PROVIDER shall reimburse CLIENT for sales and excise taxes imposed on CLIENT as a liability of CLIENT pursuant to Section 2.1.

 

 

3.

LIMITED WARRANTY AND LIMITATION OF LIABILITY

 

3.1.

Limited Warranty. SERVICE PROVIDER warrants that it shall perform the Services (a) using personnel of commercially reasonable skill, experience, and qualifications; (b) in a professional manner in accordance with generally recognized industry standards for similar services, and (c) in accordance with the Marijuana Code. SERVICE PROVIDER (x) MAKES NO WARRANTIES EXCEPT FOR THOSE SET OUT IN THIS SECTION 3.1; AND (y) DISCLAIMS ALL OTHER WARRANTIES, WHETHER EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.

 

3.2.

Limitation of Liability. THE LIMITATIONS SET FORTH IN THIS SECTION 3.2 WILL NOT APPLY TO CLAIMS DIRECTLY ARISING UNDER SECTION 2.1, OR CLAIMS ARISING FROM THE GROSS NEGLIGENCE OR INTENTIONAL MISCONDUCT OF EITHER PARTY OF THEIR RESPECTIVE DUTIES AND OBLIGATIONS UNDER THIS AGREEMENT. IN NO EVENT WILL EITHER PARTY BE LIABLE FOR ANY CONSEQUENTIAL, INDIRECT, EXEMPLARY, SPECIAL, OR INCIDENTAL DAMAGES, INCLUDING ANY LOST DATA AND LOST PROFITS, ARISING FROM OR RELATING TO THIS AGREEMENT, THE USE OF OR INABILITY TO USE ANY SERVICES PROVIDED HEREUNDER, EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. SERVICE PROVIDER’S TOTAL CUMULATIVE LIABILITY UNDER THIS AGREEMENT, WHETHER IN CONTRACT, TORT OR OTHERWISE, WILL NOT EXCEED AN AMOUNT EQUAL TO THE FEES PAID TO SERVICE PROVIDER UNDER THIS AGREEMENT MINUS THE LIABILITES PAID BY SERVICE PROVIDER RELATED TO THE ASSETS AND OPERATION OF THE BUSINESS, EACH AS DURING THE SIX MONTH PERIOD PRECEDING THE EVENTS GIVING RISE TO SUCH LIABILITY. CLIENT ACKNOWLEDGES THAT THE FEES REFLECT THE ALLOCATION OF RISK BETWEEN THE PARTIES AND THAT SERVICE PROVIDER WOULD NOT ENTER INTO THIS AGREEMENT WITHOUT THESE LIMITATIONS ON SERVICE PROVIDER’S LIABILITY.

 

4.

Term. The term of this Agreement (the “Term”) shall commence on the Effective Date and shall continue until the Transfer Date (as such term is defined in the Settlement Agreement, dated as of the date hereof, by and among SERVICE PROVIDER, CLIENT, and the other parties thereto). Upon the expiration of this Agreement, all amounts owed to either Party under this Agreement which accrued before such expiration will be immediately due and payable. Sections 2, 3.2, 4, and 5 will survive the expiration of this Agreement for any reason.

 

5.

GENERAL

 

5.1.

Governing Law. This Agreement shall be governed by the laws of the State of Colorado, without regard to its principles of conflicts of law.

 

 

5.2.

Relationship of Parties. The relationship of the parties established under this Agreement is that of independent contractors and neither party is a partner, employee, agent or joint venture partner of or with the other, and neither party has the right or authority to assume or create any obligation on behalf of the other party by virtue of this Agreement.

 

5.3.

Assignment. Neither Party may assign its rights or delegate its obligations under this Agreement without the prior written consent of the other Party, which consent shall not be unreasonably withheld or delayed. Notwithstanding the foregoing, SERVICE PROVIDER may assign its rights and obligations under this Agreement to a parent, affiliate, or subsidiary, or to a successor, whether by way of merger, sale of all or substantially all of its assets or otherwise. Any attempted assignment of this Agreement not in accordance with this subsection shall be null and void.

 

5.4.

Notices. Any notices or other communications required or permitted to be given or delivered hereunder shall be in writing and shall be delivered personally, by courier service, by email, by facsimile machine or by registered or certified mail, return receipt requested, postage pre-paid, to SERVICE PROVIDER and to CLIENT to such addresses as such Party may designate pursuant to this notice provision. Any notice given shall be deemed to have been received on the date on which it is delivered personally, by courier service, by email or by facsimile, or, if mailed, on the third business day following the mailing thereof.

 

5.5.

Force Majeure. In no event shall SERVICE PROVIDER be responsible or liable for any breach of the Agreement for failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation, strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes, epidemics or acts of God.

 

5.6.

Severability. If any provision of this Agreement is held by a court of competent jurisdiction to be unenforceable, such provision will be changed and interpreted to accomplish the objectives of such provision to the greatest extent possible under applicable law and the remaining provisions of this Agreement will continue in full force and effect.

 

5.7.

Subcontractors. CLIENT acknowledges and agrees that SERVICE PROVIDER may hire subcontractors to perform Services hereunder. SERVICE PROVIDER will be responsible for the direction and coordination of the services of each subcontractor and CLIENT will have no obligation to pay any subcontractor directly.

 

5.8.

Waiver. Any waiver or failure to enforce any provision of this Agreement on one occasion will not be deemed a waiver of any other provision or of such provision on any other occasion.

 

5.9.

Headings. The headings used for the sections of this Agreement are for information purposes and convenience only and in no way define, limit, construe or describe the scope or extent of the sections.

 

5.10.

Entire Agreement. This Agreement and its exhibits constitute the entire agreement between the parties with regard to the subject matter hereof. No oral or written representation that is not expressly contained in this Agreement is binding on SERVICE PROVIDER or CLIENT. No amendment to this Agreement shall be binding on either party unless in writing and signed by both parties.

 

5.11.

Counterparts. This Agreement may be executed in separate counterparts, each of which shall be deemed an original and all of which shall be deemed one and the same instrument.

 

 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the Effective Date.

 

		Green Tree Colorado, LLC
		By:	/s/ Adam Hershey
		Name:	Adam Hershey
		Title:	Interim CEO
		TREES Corporation
		By:	/s/ Adam Hershey
		Name:	Adam Hershey
		Title:	Interim CEO
		Allyson Feiler Downing
		/s/ Allyson Feiler Downing
		Loree Schwartz
		/s/ Loree Schwartz

 

 

Exhibit A 

Services

 

●

SERVICE PROVIDER will manage day to day operations of the Business.

●

SERVICE PROVIDER will manage hiring, training, and management of employees for the Business.

●

SERVICE PROVIDER will manage and timely pay all vendor payments, employee wages and benefit payments, insurance payments, rent and utility payments for the Business.

●

SERVICE PROVIDER will manage acquisition and operation of appropriate computer hardware and software systems and maintenance of in-house networks;

●

SERVICE PROVIDER will manage required maintenance and upkeep of facilities utilized by CLIENT except to the extent such duties are reserved to the landlord of such facility;

●

SERVICE PROVIDER will manage maintenance and support of technical equipment and IT systems used by CLIENT in connection with the Business.

●

SERVICE PROVIDER will manage compliance of the Business with all local, and state regulations including without limitation the Marijuana Code.

●

SERVICE PROVIDER will provide CLIENT proper, true and accurate record keeping of all inventory and sales data of the Business on no less frequently than a monthly basis.

●

SERVICE PROVIDER will maintain accounts, ledgers and information for the Business separate from those maintained by SERVICE PROVIDER for non-Business-related matters.

 

v3.23.2

Cover	Jul. 01, 2023
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Jul. 01, 2023
Entity File Number	000-54457
Entity Registrant Name	TREES CORPORATION
Entity Central Index Key	0001477009
Entity Tax Identification Number	90-1072649
Entity Incorporation, State or Country Code	CO
Entity Address, Address Line One	215 Union Boulevard
Entity Address, Address Line Two	Suite 415
Entity Address, City or Town	Lakewood
Entity Address, State or Province	CO
Entity Address, Postal Zip Code	80228
City Area Code	303
Local Phone Number	759-1300
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Emerging Growth Company	false

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