Item 1.01 Entry into a Material Definitive
Agreement
On June 8, 2023, the Registrant and Medihemp,
LLC, and its wholly owned subsidiary, SLAM Enterprises, LLC, and Medical Cannabis Caregivers, Inc., all collectively doing business as
"Naturaleaf," (hereafter, "Naturaleaf") entered into an amendment to the previously disclosed material definitive
agreement dated March 11, 2021, disclosed on Form 8-K March 12, 2021.
No material relationship exists between the
parties to the amendment other than with respect to the original material definitive agreement, as amended.
The original material definitive agreement
disclosed the Registrant's acquisition of assets from Naturaleaf, including, but not limited to: Naturaleaf's fixed assets, Medical Marijuana
Center licenses, a Medical Cannabis’ Medical Marijuana Infused Product Manufacturer license, a Medical Marijuana Optional Premises
Cultivation license (the "Cannabis Licenses"), customer accounts, intellectual property, goodwill, and leases. As consideration
for the purchase, the Registrant agreed to pay an aggregate purchase price of $2,200,000 in cash and 3,000,000 shares of Registrant's
common stock.
The parties agreed to a payment schedule, requiring
the Registrant to first pay an initial non-refundable payment of $20,000, credited against the Purchase Price. Thereafter, upon the party's
completion of due diligence, and their receipt of contingent approval letters for the transfer of the Cannabis Licenses from the Colorado
Marijuana Enforcement Division and the City of Colorado Springs (the "Closing"), the Registrant agreed to pay Naturaleaf $1,080,000
and issue Naturaleaf, or its designees, 3,000,000 shares of the Registrant's restricted common stock. The balance of the purchase price
of $1,100,000 was payable based upon a promissory note ("Note") issued by the Registrant, which included 10% interest. The Note
was due one year after Closing. On April 30, 2021, the Closing occurred, and the Registrant paid Naturaleaf $1,080,000 and issued 3,000,000
shares of restricted stock.
On April 19, 2022, the parties agreed to restructure
the remaining payments due to be made by the Registrant under the Note. The parties agreed that in consideration of the Registrant's payment
of $550,000, and outstanding interest of $110,000, a new promissory note in the principal amount of $550,000 and 12% interest accruing
annually, due April 29, 2023, resolves all Registrant's payments of the purchase price. The parties entered into the amendment, and the
Registrant paid the consideration of $550,000 in principal and $110,000 in interest.
On June 8, 2023, the parties agreed to restructure
the remaining payments due to be made by the Registrant under the Note, as amended, including principal and interest of Six Hundred Fifty-One
Thousand, One Hundred Sixty-Two and 50/100 US Dollars ($651,162.50). The Registrant agreed to pay $150,000 by June 30, 2023; $100,000
by July 31, 2023; and the balance by May 1, 2024. The Registrant may prepay any amount due without penalty. Concurrently, the Registrant
granted Naturaleaf a first-priority lien and security interest on the assets of the Registrant, securing the payment and performance of
the payment schedule.