Item 2.01Completion of Acquisition or Disposition of Assets.
On December 12, 2022, TREES Corporation (the "Company") completed the
acquisition ("Green Tree Acquisition") of substantially all of the assets of
Ancient Alternatives LLC ("Ancient"), Natural Alternatives For Life, LLC
("Natural"), Mountainside Industries, LLC ("Mountainside"), Hillside
Enterprises, LLC ("Hillside"), and GT Creations, LLC ("GT Creations"), each a
Colorado limited liability company (collectively, the "Green Tree Entities"). At
the closing, the Company delivered to the Green Tree Entities an aggregate of
cash equal to $500,000 and delivered to equity holders of the Green Tree
Entities an aggregate of 17,977,528 shares ("Buyer Shares") of the Company's
common stock, par value $0.01 per share ("Common Stock"). An additional
$3,500,000 in cash will be paid by the Company to the Green Tree Entities in
fifteen (15) equal monthly payments commencing on the 9-month anniversary of the
closing. The number of Buyer Shares is subject to adjustment based upon a
formula specified in the definitive purchase agreement. The Company assumed
certain liabilities at closing, including certain manufacturing agreements
between GT Creations and affiliates of the Green Tree Entities.
Allyson Feiler, a principal owner of the Green Tree Entities, was elected to the
Board of Directors of the Company effective December 12, 2022. Reference is made
to Item 5.02 of this Form 8-K for a more detailed description, the information
of which is incorporated herein by reference.
Reference is made to the Company's Form 8-K filed on September 19, 2022 for a
complete description of the Green Tree Acquisition, the information of which is
incorporated herein by reference.
Item 3.02Unregistered Sales of Equity Securities.
The information set forth in Item 2.01 of this Current Report on Form 8-K
regarding the issuance of Common Stock is incorporated herein by reference. The
shares of Common Stock were issued to Sellers in reliance on the exemption from
the registration requirements of the Securities Act of 1933, as amended, by
virtue of Section 4(a)(2) thereof.
Item 5.02Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
(b) On December 12, 2022, John Barker Dalton resigned from the Company's Board
of Directors ("Board"). Mr. Dalton's resignation was not related to a
disagreement with the Company on any matter relating to the Company's
operations, policies or practices.
(d) On December 12, 2022, Allyson Feiler was elected to serve on the Board until
the next annual meeting of stockholders of the Company and until her successor
is duly elected and qualified. Ms. Feiler was appointed by the Board to fill an
existing vacancy created when John Barker Dalton resigned from the Board. Ms.
Feiler is a principal owner of the Green Tree Entities. As previously disclosed,
the Company agreed to appoint a designee of the Green Tree Entities to the Board
following the closing of the Green Tree Acquisition. Ms. Feiler is such
designee.
As part of the Green Tree Acquisition, Ms. Feiler was appointed to the Board.
Ms. Feiler also received in connection with the Green Tree Acquisition, in her
capacity as a former equity holder of certain of the Green Tree Entities,
$191,537.50 in cash at closing, the right to receive $1,340,762.50 in cash in
the future and 7,111,396 Buyer Shares. Please refer to Item 2.01 above for a
more complete description of the Green Tree Transaction, which is incorporated
by reference herein.
On December 12, 2022, Ms. Feiler was also appointed to the Nominating Committee
of the Board.
Also on December 12, 2022, the Company and Ms. Feiler entered into a two-year
employment agreement, pursuant to which Ms. Feiler will be employed by the
Company as its Chief Marketing Officer at an annual base salary of $225,000,
with an agreed one-time bonus equal to $383,071.43, payable within 30 business
days following the closing of the acquisition of Ancient, Natural, Mountainside
and GT Creations as described above. The Employment Agreement also provides for
severance payouts up to the full initial two-year term in the event of a
termination without 'Cause' or for 'Good Reason' (as such terms are defined
therein) during the initial term.
Item 9.01Financial Statements and Exhibits.
(a) Financial Statements of Businesses or Funds Acquired.
Financial statements and pro forma financial statements for the Green Tree
Entities will be filed no later than 71 calendar days after the required filing
date of this Form 8-K.
(d)Exhibits.
Exhibit No. Description
104 Cover Page Interactive Data File (embedded within the Inline XBRL document)
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TREES CORPORATION 
