Item 1.01 Entry into a Material Definitive Agreement.
Membership Interest Purchase Agreeement
On July 1, 2021, Unrivaled Brands, Inc. (formerly known as Terra Tech Corp.) (the “Company”) entered into a Membership Interest Purchase Agreement (the “Purchase Agreement”) with Nicholas Kovacevich and Dallas Imbimbo, pursuant to which the Company acquired 100% of the outstanding membership interests in Halladay Holding, LLC from Mr. Kovacevich and Mr. Imbimbo (the “Acquisition”). Halladay Holding, LLC is the owner of real property located at 3242 S. Halladay Street, Santa Ana, CA 92705 (the “Property”), where the Company operates a cannabis dispensary and maintains its principal office space.
Pursuant to the Purchase Agreement, as consideration for the Acquisition, the Company paid Mr. Kovacevich and Mr. Imbimbo an aggregate purchase price of $4,600,495.39 in cash. The Company had an independent third-party peform a valuation of the Property prior to entering into the Purchase Agreement.
Mr. Kovacevich is the Chairman of the Company’s Board of Directors and Mr. Imbimbo is a director of the Company. As such, the Acquisition is a related party transaction.
The foregoing description of the Purchase Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Purchase Agreement, which is filed as Exhibit 2.1 hereto and incorporated herein by reference.
Agreements with Directors
On July 1, 2021, the Company entered into an Independent Director Agreement (the “Director Agreement”) and a Director Indemnification Agreement (the “Indemnification Agreement”) with each of Dallas Imbimbo and Eric Baum in connection with their appointment to the Board of Directors of the Company.
Pursuant to the Director Agreements, among other things, (1) the Company agreed to enter into a Stock Option Agreement to issue to each of Mssrs. Imbimbo and Baum an option to purchase 500,000 shares of the Company’s common stock at the closing price of the common stock on the date of the Director Agreement and (2) the Company agreed to pay each of Mssrs. Imbimbo and Baum cash compensation of $5,000 per month, pro-rated for any partial months, payable on the first day of each month beginning on the date of the Director Agreement.
Pursuant to the Indemnification Agreements, among other things, the Company agreed to hold harmless and indemnify each of Mssrs. Imbimbo and Baum to the fullest extent permitted by law, including indemnification of expenses such as attorneys’ fees, judgments, penalties, fines and settlement amounts incurred by Mssrs. Imbimbo and Baum in any proceeding arising out of their services as directors.
There is no material relationship between the Company or its affiliates and Mr. Imbimbo, other than in respect of the transactions contemplated by the Purchase Agreement, the Director Agreement and the Indemnification Agreement.
There is no material relationship between the Company or its affiliates and Mr. Baum, other than in respect of the transactions contemplated by the Director Agreement and the Indemnification Agreement.
The foregoing descriptions of the Director Agreements and the Indemnification Agreements are qualified in their entirety by reference to the full text of such documents, copies of which are filed as Exhibits 10.1, 10.2, 10.3 and 10.4, respectively, to this Current Report on Form 8-K and which are incorporated by reference herein in their entirety.