Common use of Capitalization and Ownership of Hightimes Clause in Contracts

Capitalization and Ownership of Hightimes. As at the date of this Agreement, Hightimes is authorized to issue an aggregate of 110,000,000 shares of its Capital Stock, $0.0001 par value per share, of which (i) 100,000,000 shares are designated as Hightimes Common Stock, and (ii) 10,000,000 shares are designated as preferred stock (the “Preferred Stock”), which may be issued in one or more series containing such rights, preferences and privileges as the board of directors of Hightimes may, from time to time, designate. Prior to the Closing Date the authorized number of shares of Hightimes Common Stock shall have been increased to 1,000,000,000 shares of Class A Common Stock. As of December 31, 2019, an aggregate of 24,854,396 shares of Hightimes Common Stock were issued and outstanding and as at May 15, 2020, an aggregate of 25,294,398 shares of Hightimes Common Stock were issued and outstanding. The fully-diluted Hightimes Common Stock after giving effect to the conversion or exercise of all Common Stock Equivalents as at December 31, 2019 and May 15, 2020, are 33,678,978 and 35,421,978 shares of Hightimes Common Stock, respectively. The shares of Hightimes Common Stock owned by its officers, directors and holders of 5% or more of the outstanding Hightimes Common Stock are reflected in Hightimes SEC Reports. The Merger Shares, if and when issued to the Owner in accordance with the terms and conditions of this Agreement, will be duly authorized, validly issued, fully paid and non-assessable, free and clear of all Encumbrances (other than those arising under federal or state securities laws). The issue of the Merger Shares will not result in a right of any holder of any securities of Hightimes to adjust the exercise, exchange or reset the price under such securities or give rise to any preemptive rights, rights of first refusal or other similar rights. Hightimes has made available to the Owner true and complete copies of its Charter Documents, as in effect on the date hereof. Except as set forth in Section 6.02 of the Hightimes Disclosure Letter, Hightimes currently has no subsidiaries and will not own any subsidiaries as at the Effective Time of the Merger. Merger Sub is authorized to issue an aggregate of 1,000 shares of its common stock, no par value per share. As of the date of this Agreement, all shares of the common stock of Merger Sub are issued and outstanding and are owned directly by Hightimes. Except for the common stock of Merger Sub, there are no Capital Stock or Common Stock Equivalents of Merger Sub.

Capitalization and Ownership of Hightimes. As at the date of this Agreement, Agreement Hightimes owns 100% of the shares of capital stock of the Purchaser. Hightimes is authorized to issue an aggregate of 110,000,000 120,000,000 shares of its Capital Stockcapital stock, $0.0001 par value per share, of which (i) 100,000,000 110,000,000 shares are designated as Hightimes common stock, with 100,000,000 shares designated as Class A voting common stock (“Class A Common Stock”) and 10,000,000 shares designated as Class B non-voting common stock (the “Class B Common Stock”, and together with the Class A Common Stock, the “Common Stock”), and (ii) 10,000,000 shares are designated as preferred stock (the “Preferred Stock”), ) which may be issued in one or more series containing such rights, preferences and privileges as the board of directors of the Hightimes Parties may, from time to time, designate. Prior to As at the Closing Date the authorized number date of shares this Agreement, an aggregate of Hightimes Common Stock shall have been increased to 1,000,000,000 20,639,916 shares of Class A Common Stock. As of December 31, 2019, an aggregate of 24,854,396 shares of Hightimes Common Stock were issued and outstanding and as at May 15, 2020, an aggregate of 25,294,398 shares of Hightimes Common Stock were are issued and outstanding, and no shares of Class B Common Stock have been issued. The fully-diluted Hightimes Common Stock after giving effect to the conversion or exercise of all Common Stock Equivalents as at December 31, 2019 and May 15, 2020, are 33,678,978 and 35,421,978 shares of Hightimes Common Stock, respectively. The shares of Hightimes Common Stock owned by its officers, directors and holders of 5% or more of the outstanding Hightimes Common Stock are reflected in Hightimes SEC Reports. The Merger Subject Shares, if and when issued to the Owner in accordance with the terms and conditions of this Agreementissued, will be duly authorized, authorized validly issued, fully paid and non-assessable, free and clear of all Encumbrances pledges, liens, encumbrances and other restrictions (other than those arising under federal or state securities lawslaws as a result of the issuance of the Subject Shares). The Origo Shares, if issued, will be duly authorized validly issued, fully paid and non-assessable, free and clear of all pledges, liens, encumbrances and other restrictions (other than those arising under federal or state securities laws as a result of the issuance of the Origo Shares). The issue and sale of the Merger Subject Shares or the issuance of the Origo Shares will not result in a right of any holder of any Hightimes Parties securities of Hightimes to adjust the exercise, exchange or reset the price under such securities or give rise to any preemptive rights, rights of first refusal or other similar rights. The authorized capital stock of Purchaser consists of 1,000 shares, without par value, of which 1,000 shares are issued and outstanding and owned of record and beneficially by Hightimes. The Hightimes Parties has each made available to the Owner Southland true and complete correct copies of its Charter DocumentsCertificate of Incorporation, and as in effect on the date hereof (the “Certificate of Incorporation”), and its By-laws, as in effect on the date hereof. Except as set forth in Section 6.02 of hereof (the Hightimes Disclosure Letter, Hightimes currently has no subsidiaries and will not own any subsidiaries as at the Effective Time of the Merger. Merger Sub is authorized to issue an aggregate of 1,000 shares of its common stock, no par value per share. As of the date of this Agreement, all shares of the common stock of Merger Sub are issued and outstanding and are owned directly by Hightimes. Except for the common stock of Merger Sub, there are no Capital Stock or Common Stock Equivalents of Merger Sub“By-laws”).

Capitalization and Ownership of Hightimes. As at the date of this Agreement, Hightimes owns 100% of the shares of capital stock of the Purchaser. Hightimes is authorized to issue an aggregate of 110,000,000 120,000,000 shares of its Capital Stockcapital stock, $0.0001 par value per share, of which (i) 100,000,000 110,000,000 shares are designated as Hightimes common stock, with 100,000,000 shares designated as Class A voting common stock (“Class A Common Stock”) and 10,000,000 shares designated as Class B non-voting common stock (the “Class B Common Stock“, and together with the Class A Common Stock, the “Common Stock”), and (ii) 10,000,000 shares are designated as preferred stock (the “Preferred Stock”), which may be issued in one or more series containing such rights, preferences and privileges as the board of directors of the Hightimes Parties may, from time to time, designate. Prior to As at the Closing Date the authorized number date of shares this Agreement, an aggregate of Hightimes Common Stock shall have been increased to 1,000,000,000 approximately 28,000,000 shares of Class A Common Stock. As of December 31, 2019, an aggregate of 24,854,396 shares of Hightimes Common Stock were issued and outstanding and as at May 15, 2020, an aggregate of 25,294,398 shares of Hightimes Common Stock were are issued and outstanding, and no shares of Class B Common Stock or Preferred Stock have been issued. The fully-diluted Hightimes Common Stock after giving effect to the conversion or exercise of all Common Stock Equivalents as at December 31, 2019 and May 15, 2020, are 33,678,978 and 35,421,978 shares of Hightimes Common Stock, respectively. The shares of Hightimes Common Stock owned by its officers, directors and holders of 5% or more of the outstanding Hightimes Common Stock are reflected in Hightimes SEC Reports. The Merger Subject Shares, if and when issued to the Owner Company in accordance with the terms and conditions of this Agreement, will be duly authorized, authorized validly issued, fully paid and non-assessable, free and clear of all Encumbrances Liens (other than those arising under federal or state securities lawslaws as a result of the issuance of the Subject Shares). The issue and sale of the Merger Subject Shares will not result in a right of any holder of any securities of the Hightimes Parties to adjust the exercise, exchange or reset the price under such securities or give rise to any preemptive rights, rights of first refusal or other similar rights. The authorized capital stock of Purchaser consists of 1,000 shares, without par value, of which 1,000 shares are issued and outstanding and owned of record and beneficially by Hightimes. Each of the Hightimes Parties has made available to the Owner Spannabis true and complete copies of its Charter Documents, as in effect on the date hereof. Except as set forth in Section 6.02 of the Hightimes Disclosure Letter, Hightimes currently has no subsidiaries and will not own any subsidiaries as at the Effective Time of the Merger. Merger Sub is authorized to issue an aggregate of 1,000 shares of its common stock, no par value per share. As of the date of this Agreement, all shares of the common stock of Merger Sub are issued and outstanding and are owned directly by Hightimes. Except for the common stock of Merger Sub, there are no Capital Stock or Common Stock Equivalents of Merger Sub.

Capitalization and Ownership of Hightimes. As at the date of this Agreement, Hightimes Agreement HIGHTIMES owns 100% of the shares of capital stock of TRANS-HIGH. HIGHTIMES is authorized to issue an aggregate of 110,000,000 55,000,000 shares of its Capital Stockcapital stock, $0.0001 par value per share, of which (i) 100,000,000 50,000,000 shares are designated as Hightimes common stock, with 40,000,000 shares designated as Class A voting common stock (“Class A Common Stock”) and 10,000,000 shares designated as Class B non-voting common stock (the “Class B Common Stock”, and together with the Class A Common Stock, the “Common Stock”), and (ii) 10,000,000 5,000,000 shares are designated as preferred stock (the “Preferred Stock”), ) which may be issued in one or more series containing such rights, preferences and privileges as the board of directors of Hightimes the HIGHTIMES GROUP may, from time to time, designate. Prior to As at the Closing Date the authorized number date of shares this Agreement, an aggregate of Hightimes Common Stock shall have been increased to 1,000,000,000 20,061,265 shares of Class A Common Stock. As of December 31, 2019, an aggregate of 24,854,396 shares of Hightimes Common Stock were issued and outstanding and as at May 15, 2020, an aggregate of 25,294,398 shares of Hightimes Common Stock were are issued and outstanding, and no shares of Class B Common Stock have been issued. The fully-diluted Hightimes Common Stock after giving effect to the conversion or exercise of all Common Stock Equivalents as at December 31, 2019 and May 15, 2020, are 33,678,978 and 35,421,978 shares of Hightimes Common Stock, respectively. The shares of Hightimes Common Stock owned by its officers, directors and holders of 5% or more of the outstanding Hightimes Common Stock are reflected in Hightimes SEC Reports. The Merger Subject Shares, if and when issued to the Owner in accordance with the terms and conditions of this Agreementissued, will be duly authorized, authorized validly issued, fully paid and non-assessablenonassessable, free and clear of all Encumbrances pledges, liens, encumbrances and other restrictions (other than those arising under federal or state securities lawslaws as a result of the issuance of the Subject Shares). The Origo Shares, if issued, will be duly authorized validly issued, fully paid and nonassessable, free and clear of all pledges, liens, encumbrances and other restrictions (other than those arising under federal or state securities laws as a result of the issuance of the Origo Shares). The issue and sale of the Merger Subject Shares or the issuance of the Origo Shares will not result in a right of any holder of any HIGHTIMES GROUP securities of Hightimes to adjust the exercise, exchange or reset the price under such securities or give rise to any preemptive rights, rights of first refusal or other similar rights. Hightimes HIGHTIMES GROUP has each made available to the Owner GREEN RUSH true and complete correct copies of its Charter DocumentsCertificate of Incorporation, and as in effect on the date hereof (the “Certificate of Incorporation”), and its By-laws, as in effect on the date hereof. Except as set forth in Section 6.02 of hereof (the Hightimes Disclosure Letter, Hightimes currently has no subsidiaries and will not own any subsidiaries as at the Effective Time of the Merger. Merger Sub is authorized to issue an aggregate of 1,000 shares of its common stock, no par value per share. As of the date of this Agreement, all shares of the common stock of Merger Sub are issued and outstanding and are owned directly by Hightimes. Except for the common stock of Merger Sub, there are no Capital Stock or Common Stock Equivalents of Merger Sub“By-laws”).

Capitalization and Ownership of Hightimes. As at the date of this Agreement, Hightimes is authorized to issue an aggregate of 110,000,000 shares of its Capital Stock, $0.0001 par value per share, of which (i) 100,000,000 shares are designated as Hightimes Common Stock, and (ii) 10,000,000 shares are designated as preferred stock (the “Preferred Stock”), which may be issued in one or more series containing such rights, preferences and privileges as the board of directors of Hightimes may, from time to time, designate. Prior to the Closing Date the authorized number of shares of Hightimes Common Stock shall have been increased to 1,000,000,000 shares of Class A Common Stock. As of December 31, 2019, an aggregate of 24,854,396 shares of Hightimes Common Stock were issued and outstanding and as at May 15, 2020, an aggregate of 25,294,398 approximately 25,294,000 shares of Hightimes Common Stock were are issued and outstandingoutstanding and no shares of Preferred Stock have been issued. The fully-diluted Hightimes Common Stock after giving effect to the conversion or exercise of all Common Stock Equivalents as at December 31, 2019 and May 15On June 22, 2020, are 33,678,978 and 35,421,978 in connection with the acquisition of the equity of a subsidiary of Harvest Health & Recreation, Inc. that has certain rights to own eight cannabis dispensaries located in California, Hightimes issued 600,000 shares of Hightimes Common its Series A convertible Preferred Stock, respectivelyas reflected in the Hightimes Form 1-U SEC Report dated June 23, 2020. The shares of Hightimes Common Stock owned by its officers, directors and holders of 5% or more of the outstanding Hightimes Common Stock are reflected in Hightimes SEC Reports. The Merger SharesHightimes Common Stock, if and when issued to the Owner Owners in accordance with the terms and conditions of this Agreement, will be duly authorized, validly issued, fully paid and non-assessable, free and clear of all Encumbrances (other than those arising under federal or state securities laws). The issue and sale of Merger Shares in payment of the Merger Shares Consideration will not result in a right of any holder of any securities of Hightimes to adjust the exercise, exchange or reset the price under such securities or give rise to any preemptive rights, rights of first refusal or other similar rights. Hightimes has made available to the Owner Owners true and complete copies of its Charter Documents, as in effect on the date hereof. Except as set forth in Section 6.02 of the Hightimes Disclosure Letter, Hightimes currently has no subsidiaries and will not own any subsidiaries as at the Effective Time of the Merger. Merger Sub is authorized to issue an aggregate of 1,000 shares of its common stock, no par value per share. As of the date of this Agreement, all shares of the common stock of Merger Sub are issued and outstanding and are owned directly by Hightimes. Except for the common stock of Merger Sub, there are no Capital Stock or Common Stock Equivalents of Merger Sub.