MARIMED INC. 10-K

ITEM 9A. CONTROLS AND PROCEDURES. Evaluation of Disclosure Controls and Procedures The Company’s management, with the participation of its CEO and CFO, evaluated the effectiveness of the Company’s disclosure controls and procedures (defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of December 31, 2020 (the “Evaluation Date”). Based upon that evaluation, the CEO and CFO concluded that, as of the Evaluation Date, the Company’s disclosure controls and procedures are effective to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act (i) are recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and (ii) are accumulated and communicated to the Company’s management, including its CEO and CFO, as appropriate to allow timely decisions regarding required disclosure. Management’s Annual Report on Internal Control Over Financial Reporting The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting and for the assessment of the effectiveness of internal control over financial reporting. As defined by the SEC in Rule 13a-15(f) and 15d-15(f) under the Exchange Act, internal control over financial reporting is a process designed by, or under the supervision of, the CEO and CFO, and effected by the board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. The Company’s internal control system is designed to provide reasonable assurances to its management and the board of directors regarding the preparation and fair presentation of published financial statements. All internal control systems, no matter how well designed, have inherent limitations which may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. The Company’s CEO and CFO assessed the effectiveness of its internal control over financial reporting as of December 31, 2020. In making this assessment, the CEO and CFO used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control—Integrated Framework . Based on that assessment and using the COSO criteria, the CEO and CFO have concluded that, as of December 31, 2020, its internal control over financial reporting was not effective due to the lack of a formalized and complete set of policy and procedure documentation evidencing the Company’s system of internal controls over financial reporting (“Lack of Formal Documentation”). Such Lack of Formal Documentation is not uncommon in a company of the Company’s size due to personnel and financial limitations. The Company’s management intends to work to remediate the Lack of Formal Documentation, which is expected to include the hiring of an independent consulting or accounting firm to review and document its internal control system to ensure compliance with COSO. However, the Company’s financial position could make it difficult for it to implement this remediation. Changes in Internal Control over Financial Reporting Over the reporting period, the Company implemented significant measures to remediate past instances of ineffectiveness of the Company’s internal control over financial reporting, The remediation measures consisted of the engagement of accounting consultants as needed to provide expertise on specific areas of the accounting guidance, the continued hiring of individuals with appropriate experience in internal controls over financial reporting, and the modification of to the Company’s accounting processes and enhancement to the Company’s financial control. Further, the Company expanded its board of directors to include a majority of independent disinterested directors; established an audit, compensation, and corporate governance committee of the board of directors; and adopted a formal policy with respect to related party transactions. Other than as described above, there was no change to the Company’s internal control over financial reporting (as defined in Rules 13a-15(f) or 15d-15(f) under the Exchange Act) identified in connection with the evaluation required by Rules 13a-15(d) or 15d-15(d) that occurred during the fiscal year ended December 31, 2020 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting. Attestation Report of the Registered Public Accounting Firm Pursuant to rules of the SEC that permit the Company to provide only its management’s report in this annual report on Form 10-K, an attestation report of the Company’s independent registered public accounting firm regarding internal control over financial reporting is not included in this Form 10-K. ITEM 9B. OTHER INFORMATION. In March 2021, the Company entered into a first amendment to the securities purchase agreement with Hadron and issued an amended and restated common stock purchase warrant. Please refer to Exhibits 10.14 and 4.7 of this Form 10-K for a complete description of the first amendment to the securities purchase agreement and amended and restated common stock purchase warrant. ( 64 ) PART III ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE. The following table sets forth the name, age and position of to the Company’s directors and executive officers. to the Company’s directors are elected annually and serve until the next annual meeting of stockholders. Name Age Position Robert Fireman 72 President, Chief Executive Officer, and Chairman Jon R. Levine 56 Chief Financial Officer, Treasurer, Secretary, and Director Eva Selhub, M.D. (4) (5) 53 Director David Allen (1) (5) 66 Director Edward Gildea (2) (3) 69 Director (1) Chairman of the Audit Committee. (2) Member of the Audit Committee. (3) Chairman of the Compensation Committee and the Nominating and Corporate Governance Committee. (4) Member of the Compensation Committee. (5) Member of the Nominating and Corporate Governance Committee. Set forth below is a brief description of the background and business experience of to the Company’s executive officers and directors: Robert Fireman has served as our president and chief executive officer since July 2017. In addition, Mr. Fireman has been a director since our formation, and is a seasoned executive in the building of technology and consumer driven companies. Mr. Fireman was a founder and director of Consumer Card Marketing, Inc., a pioneer in the development of retail loyalty marketing programs for the supermarket and drug store industries. This company was sold to News America Marketing, a division of News Corp. Mr. Fireman has been a practicing attorney for over 30 years. Mr. Fireman is the CEO of our wholly-owned subsidiary, MariMed Advisors Inc., a director of Worlds Inc. and a former part owner of Sigal Consulting LLC. He has over ten years of experience in the emerging cannabis industry across the country. In February 2019, Mr. Fireman was appointed to GenCanna’s board of directors. We believe that Mr. Fireman’s experience in the emerging cannabis industry and his professional background make him well-qualified to serve as chairman of the Company’s board of directors (the “Board”). Jon R. Levine has served as our chief financial officer, treasurer, and secretary since July 2017 and has been a director since 2016. Mr. Levine has over nine years of experience in the cannabis industry. He possesses over 19 years of experience in commercial real estate development, management and financial services. Mr. Levine was a partner at Equity Industrial Partners, a national commercial real estate management group. He also has past experience in banking at US Trust Bank as an asset based lender and in the leasing industry with AT&T Financial Services and New Court Financial as a senior credit officer. Mr. Levine also serves as the CFO of our wholly-owned subsidiary, MariMed Advisors Inc., and in that capacity, he has been responsible for the management and reporting of most of the Company’s revenue and financial transactions. Mr. Levine is a former part owner of Sigal Consulting LLC. We believe that Mr. Levine’s experience in the cannabis industry and his professional background make him an important part of our management team and make him well-qualified to serve as a member of the Board. Eva Selhub, M.D. has been a director since September 2019. Dr. Selhub is a board-certified physician, speaker, scientist, executive leadership and performance coach, consultant in the field of corporate wellness and resilience, and an author. From August 1997 to November 2016, she served as an instructor and lecturer of medicine at Harvard Medical School. During this period, Dr. Selhub simultaneously held other positions at Tufts University, Massachusetts General Hospital, as well as other professional healthcare/medical organizations. From October 2006 to October 2017, she was a senior physician at Benson Henry Institute for Mind/Body Medicine at Massachusetts General Hospital. From August 2016 to present, she has been an adjunct scientist of neuroscience at Jean Mayer USDA Human Nutrition Research Center on Aging at Tufts University, one of six human nutrition research centers supported by the United States Department of Agriculture. Dr. Selhub received a Bachelor of Arts degree in anthropology from Tufts University in 1989 and her M.D. degree from Boston University School of Medicine in 1994. Dr. Selhub’s professional experience and background as a physician, scientist and in mind-body medicine allow her to make valuable contributions to the Board and provide expertise to serve as one of our directors. ( 65 ) David Allen has been a director since June 2019. He brings over 22 years of experience as a director, CEO and CFO of public companies. Presently he serves as Chief Financial Officer of Charlie’s Holdings, Inc. (formerly known as True Drinks Holdings, Inc.). From September 2018 to May 2019, Mr. Allen served as Chief Financial Officer of Iconic Brands, Inc. Prior to that, from December 2014 to January 2018, Mr. Allen served as the Chief Financial Officer of WPCS International, Inc. From 2004 to 2017, Mr. Allen served as Chief Financial Officer of Bailey’s Express, Inc., a privately held trucking corporation, which filed for Chapter 11 bankruptcy in July 2017. Mr. Allen served as the Chapter 11 Plan Administrator for the bankruptcy case until December 2020, at which time the proceeding was closed. From June 2006 to June 2013, Mr. Allen served as the Chief Financial Officer and Executive Vice President of Administration at Converted Organics, Inc., after serving as audit committee chair of the board of Converted Organics. Mr. Allen is currently an Assistant Professor of Accounting at Southern Connecticut State University (SCSU), a position he has held since 2017. For the 12 years prior, he was an Adjunct Professor of Accounting at SCSU and Western Connecticut State University. Mr. Allen is a licensed CPA and holds a bachelor’s degree in Accounting and a master’s degree in Taxation from Bentley College. Mr. Allen’s background as a director, CEO and CFO of public companies allows him to make valuable contributions to the Board. Edward Gildea has been a director since our formation. Since February 2014, Mr. Gildea has been a partner in the law firm Fisher Broyles LLP. From 2006 to 2013, Mr. Gildea was President, Chief Executive Officer, and Chairman of Converted Organics Inc., a publicly held green technology company that manufactured and sold an organic fertilizer, made from recycled food waste. Mr. Gildea contributes expertise in areas of mergers & acquisitions, strategic planning, funding, business development, and executive leadership. Mr. Gildea received a B.A. from The College of the Holy Cross and a J.D. from Suffolk University Law School. Mr. Gildea’s executive business experience was instrumental in his selection as a member of the Board. Family Relationships None of the directors or executive officers are related by blood, marriage, or adoption. Legal Proceedings None. Code of Ethics We have adopted a code of ethics (the “Code of Ethics”) that applies to our principal chief executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. A copy of the Code of Ethics can be found on our website at https://bit.ly/MRMDethics. The Code of Ethics was designed with the intent to deter wrongdoing, and to promote the following: ● Honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships ● Full, fair, accurate, timely and understandable disclosure in reports and documents that we file with, or submit to, the Commission and in other public communications we make ● Compliance with applicable governmental laws, rules and regulations ● The prompt internal reporting of violations of the code to an appropriate person or persons identified in the code ● Accountability for adherence to the code ( 66 ) Director Independence The Board has determined that Messrs. David Allen and Edward Gildea, and Dr. Eva Selhub are independent and represent a majority of its members. In determining director independence, the Board applies the independence standards set by the Nasdaq Stock Market (“ NASDAQ ”). In applying these standards, our Board considers all transactions with the independent directors and the impact of such transactions, if any, on any of the independent directors’ ability to continue to serve on our Board. Board Committees The Board has three standing committees: an audit committee (the “Audit Committee”), a compensation committee (the “Compensation Committee”) and a nominating and corporate governance committee (the “Nominating and Corporate Governance Committee”). Each committee is made up entirely of independent directors as defined under section 5605(a)(2) of the NASDAQ rules. The members of the Audit Committee are Messrs. Allen and Gildea. Mr. Allen is also the chairman of the Audit Committee and qualifies as the “audit committee financial expert” pursuant to Item 407(d)(5) of Regulation S-K. The members of the Compensation Committee are Mr. Gildea and Dr. Selhub, and the members of the Nominating and Corporate Governance Committee are Messrs. Allen and Gildea and Dr. Selhub. Mr. Gildea is the chairman of both of these committees. The Audit Committee, the Compensation Committee, and the Nominating and Corporate Governance Committee have, the responsibilities described below. Audit Committee. The Audit Committee oversees our accounting and financial reporting processes, internal systems of accounting and financial controls, relationships with auditors and audits of financial statements. Specifically, the Audit Committee’s responsibilities include the following: ● selecting, hiring and terminating our independent auditors; ● evaluating the qualifications, independence and performance of our independent auditors; ● approving the audit and non-audit services to be performed by the independent auditors; ● reviewing the design, implementation and adequacy and effectiveness of our internal controls and critical policies; ● overseeing and monitoring the integrity of our financial statements and our compliance with legal and regulatory requirements as they relate to our financial statements and other accounting matters; ● with management and our independent auditors, reviewing any earnings announcements and other public announcements regarding our results of operations; and ● preparing the report that the SEC requires in our annual proxy statement. A copy of the Audit Committee charter is available on our website at www.marimedinc.com . Compensation Committee. The Compensation Committee assists the Board in determining the compensation of our officers and directors. The Compensation Committee is comprised entirely of directors who satisfy the standards of independence applicable to Compensation Committee members established under 162(m) of the Code and Section 16(b) of the Securities and Exchange Act of 1934, as amended (the “ Exchange Act ”). Specific responsibilities include the following: ● approving the compensation and benefits of our executive officers; ● reviewing the performance objectives and actual performance of our officers; and ● administering our stock option and other equity and incentive compensation plans. ( 67 ) Nominating and Corporate Governance Committee. The Nominating and Corporate Governance Committee assists the Board by identifying and recommending individuals qualified to become members of the Board. Specific responsibilities include the following: ● evaluating the composition, size and governance of our Board and its committees and making recommendations regarding future planning and the appointment of directors to our committees; ● establishing a policy for considering stockholder nominees to our Board; ● reviewing our corporate governance principles and making recommendations to the Board regarding possible changes; and ● reviewing and monitoring compliance with our code of ethics and insider trading policy. Board Nominations Prior to the establishment of the Nominating and Corporate Governance Committee, the entire Board acted as the nominating committee for the purposes of identifying and recommending director candidates. The Board was responsible for nominating director candidates for the annual meeting of stockholders each year and considered director candidates recommended by stockholders. These responsibilities have largely been assumed by the Nominating and Corporate Governance Committee. In considering candidates submitted by stockholders, the Nominating and Corporate Governance Committee will take into consideration the needs of the Board and the qualifications of the candidate. The Nominating and Corporate Governance Committee may also take into consideration the number of shares held by the recommending stockholder and the length of time that such shares have been held. To have a candidate considered by the Nominating and Corporate Governance Committee for recommendation to the Board for nomination as a director candidate, a stockholder must submit the recommendation in writing and must include the following information: (i) the name of the stockholder and evidence of the person’s ownership of Company stock, (including the number of shares owned and the length of time of ownership); (ii) the name of the candidate; (iii) the candidate’s resume or a listing of his or her qualifications to be a director of the Company; and (iv) the person’s consent to be named as a director if selected and nominated by the Board. The information described above must be sent to the Company’s Secretary at 10 Oceana Way, Norwood, Massachusetts 02062, on a timely basis in order to be considered by the Nominating and Corporate Governance Committee, within the time period prescribed by Rule 14a-8 under the Exchange Act. Section 16(a) Beneficial Ownership Reporting Compliance Under Section 16(a) of the Exchange Act, all executive officers, directors, and each person who is the beneficial owner of more than 10% of the common stock of a company that files reports pursuant to Section 12 of the Exchange Act, are required to report the ownership of such common stock, options, and stock appreciation rights (other than certain cash-only rights) and any changes in that ownership with the Commission. Specific due dates for these reports have been established, and we are required to report, in this Form 10-K, any failure to comply therewith during the fiscal year ended December 31, 2020 or prior fiscal years. Other than as set forth in the Delinquent Section 16(a) Reports section below, we believe that all of these filing requirements were satisfied by the Company’s executive officers, directors and by the beneficial owners of more than 10% of our common stock. In making this statement, we have relied solely on copies of any reporting forms received by us, and upon any written representations received from reporting persons that no Form 5 (Annual Statement of Changes in Beneficial Ownership) was required to be filed under applicable rules of the Commission. Delinquent Section 16(a) Reports Each of Robert Fireman and Jon Levine was not timely in the filing of one Form 4 during the fiscal year ended December 31, 2020 to report an option exercise in November 2020. Edward Gildea was not timely in the filing of one Form 4 during the fiscal year ended December 31, 2020 to report an option exercise in December 2020. ( 68 ) ITEM 11. EXECUTIVE COMPENSATION. The following table sets forth the compensation paid by the Company during the fiscal periods ended December 31, 2020 and 2019 to its chief executive officer and other most highly compensated executive officers whose compensation exceeded $100,000 for the year ended December 31, 2020. Summary Compensation Table (1) (2) Name and principal position Year Salary Bonus Stock Awards Option Awards (3) All Other Compensation Total Robert Fireman 2020 $ 31,486 $ 0 $ 0 $ 0 $ 0 $ 31,486 President and CEO 2019 $ 150,000 $ 0 $ 0 $ 0 $ 0 $ 150,000 Jon R. Levine 2020 $ 37,486 $ 0 $ 0 $ 0 $ 0 $ 37,486 Chief Financial Officer 2019 $ 150,000 $ 0 $ 0 $ 0 $ 0 $ 150,000 (1) The compensation reported on the table does not include other personal benefits, the total value of which do not exceed $10,000. (2) Pursuant to the regulations promulgated by the SEC, the table omits columns reserved for types of compensation not applicable to us. (3) Amounts represent the fair value of option awards valued on grant date using the Black-Scholes pricing model and recognized over the vesting period for financial reporting purposes. Stock Option Grants The following table sets forth information as of December 31, 2020 concerning unexercised options, unvested stock and equity incentive plan awards for the officers named in the Summary Compensation Table. Outstanding Equity Awards at Year Ended December 31, 2020 Name Number of Securities Underlying Unexercised Options Exercisable (#) Number of Securities Underlying Unexercised Options Unexercisable (#) Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) Option Exercise Price ($) Option Expiration Date Robert Fireman 100,000 - - $ 0.63 12/31/21 Jon R. Levine 100,000 - - $ 0.63 12/31/21 ( 69 ) Compensation of Directors In September 2019, the Board adopted a resolution to establish a compensation package for each of the three non-employee members of the Board. Based on certain publicly available surveys and other related inquiry, such compensation package is comprised of a grant of stock options to purchase 100,000 shares of the Company’s common stock with a five-year term and an exercise price of $0.99 per share which equaled the fair value the Company’s common stock on the grant date, and cash compensation of $6,250 per quarter. Previous to this resolution, the Board had ceased the payment of compensation to non-employee directors. The following table sets forth information concerning the compensation paid to each of to the Company’s non-employee directors during 2020 for their services rendered as directors. Name Fees Earned or Paid in Cash Stock Awards Option Awards Total Eva Selhub, M.D. (1) $ 18,750 $ 0 $ 0 $ 18,750 David Allen (2) $ 18,750 $ 0 $ 0 $ 18,750 Edward Gildea (3) $ 18,750 $ 0 $ 0 $ 18,750 (1) Dr. Selhub held 100,000 stock options at December 31, 2020. (2) Mr. Allen held 100,000 stock options at December 31, 2020. (3) Mr. Gildea held 300,000 stock options at December 31, 2020. ( 70 ) ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS. The following table sets forth as of March 23, 2021, certain information with respect to the beneficial ownership of common stock by (i) each of to the Company’s directors and executive officers; (ii) each person known to us who owns beneficially more than 5% of the common stock; and (iii) all directors and executive officers as a group. Name and Address of Beneficial Owner (1) Amount & Nature of Beneficial Owner % of Class (2) Robert Fireman 23,655,218 (3) 7.40% Jon R. Levine 26,769,983 (3) 8.37% Eva Selhub, M.D. 100,000 (3) * David Allen 100,000 (3) * Edward Gildea 529,391 (4) * All directors and executive officers as a group (five persons) 51,091,126 (5) 15.99% Greater Than 5% Stockholders: Gerald McGraw 17,729,932 5.54% James Griffin 17,179,932 5.37% * (1) Less than one percent. The business address for each person named is c/o MariMed Inc., 10 Oceana Way, Norwood, MA 02062. (2) Calculated pursuant to Rule 13d-3(d)(1) of the Securities Exchange Act of 1934 whereby shares not outstanding which are subject to options, warrants, rights or conversion privileges exercisable within 60 days are deemed outstanding for the purpose of calculating the number and percentage owned by a person, but not deemed outstanding for the purpose of calculating the percentage owned by each other person listed. We believe that each individual or entity named has sole investment and voting power with respect to the shares of common stock indicated as beneficially owned by them (subject to community property laws where applicable) and except where otherwise noted. All percentages are determined based on 319,133,727 shares of common stock outstanding as of March 23, 2021 (3) Includes 100,000 currently exercisable stock options. (4) Includes 300,000 currently exercisable stock options. (5) Includes 700,000 currently exercisable stock options ( 71 ) ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE. Concurrent with the conversion of the subordinated secured convertible debentures of GenCanna disclosed in Note 4 – Investments within the Company’s audited financial statements included elsewhere in this report, the Company’s CEO was appointed to GenCanna’s board of directors. In 2019, the Company, through its MariMed Hemp subsidiary, entered into several hemp seed sale transactions with GenCanna whereby the Company acquired $20.75 million of hemp seed inventory which it sold and delivered to GenCanna for $33.2 million. The Company provided GenCanna with extended payment terms through December 2019, to coincide with the completion of the seeds’ harvest, although the payment by GenCanna was not contingent upon the success of such harvest or its yield. To partially fund the seed purchases, the Company raised $17.0 million in debt financings which is included in Notes Payable on the balance sheet and discussed in Note 11 – Debt within the Company’s audited financial statements. By the end of 2019, GenCanna had not paid the amount it owed the Company for its seed purchases and in February 2020, as previously discussed in Note 4 – Investments , under pressure from certain of its creditors, the GenCanna Debtors agreed to convert a previously-filed involuntary bankruptcy proceeding into a voluntary Chapter 11 proceeding, and filed voluntary petitions under Chapter 11 in the Bankruptcy Court. As required by the relevant accounting guidance, the Company initially recorded the $33.2 million due from GenCanna as a related party receivable, with approximately $29.0 million recognized as related party revenue, and approximately $4.2 million classified as unearned revenue (such amount representing the Company’s 33.5% ownership portion of the profit on these transactions, which was to have been recognized as revenue upon payment by GenCanna). As a result of GenCanna’s Chapter 11 proceedings, the Company fully reserved the receivable balance of approximately $29.0 million and wrote off the entire unearned revenue balance of approximately $4.2 million. Please refer to Note 21 – Commitments and Contingencies within the Company’s audited financial statements for additional discussion of GenCanna’s bankruptcy proceedings. In 2020, options to purchase an aggregate of 550,000 shares of common stock were exercised by the Company’s CEO, CFO, and an independent board member at exercise prices of $0.13 and $0.14 per share. In 2019, options to purchase an aggregate of 332,499 shares of common stock were exercised by the Company’s CEO and an independent board member at exercise prices of $0.08 and $0.14 per share. The independent board member’s 132,499 options were exercised on a cashless basis with the exercise prices paid via the surrender of 3,108 shares of common stock. At December 31, 2019, the shares of common stock associated with the exercise by the Company’s CEO were not issued and included in Common Stock Subscribed But Not Issued on the balance sheet. In 2019, options to purchase 117,501 shares of common stock were forfeited by board members. No options were forfeited by related parties in 2020. The Company’s current corporate offices are leased from a company owned by the CFO under a 10-year lease that commenced August 2018 and contains a five-year extension option. In 2020 and 2019, expenses incurred under this lease approximated $156,000 in both years. In 2020 and 2019, the Company procured nutrients, lab equipment, cultivation supplies, a vehicle, small tools, and furniture from an entity owned by the Company’s COO and President. The aggregate purchases in 2020 and 2019 approximated $2.5 million and $3.2 million, respectively. In 2020 and 2019, the Company paid royalties on the revenue generated from its Betty’s Eddies® product line to an entity owned by the Company’s COO and President. The aggregate royalties owed in 2020 and 2019 approximated $615,000 and $600,000, respectively. In 2020 and 2019, the Company paid management fees to an entity owned by the Company’s CEO and CFO. The aggregate paid in 2020 and 2019 approximated $41,000 and $145,000, respectively. ( 72 ) ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES. Fees Billed for Audit and Non-Audit Services The following table represents the aggregate fees billed for professional audit services rendered by the independent registered public audit firm of M&K CPAs PLLC for the audit of the annual financial statements for the years ended December 31, 2020 and 2019. Year Ended December 31, 2020 2019 Audit fees (1) $ 95,000 $ 97,345 Audit-related fees (2) - - Tax fees (3) - - All other fees (4) 1,500 - Total accounting fees and services $ 96,500 $ 97,345 (1) Fees for professional services for the audit of the Company’s annual financial statements, and for the review of the financial statements included in the Company’s filings on Form 10-Q, and for services that are normally provided in connection with statutory and regulatory filings or engagements. (2) Fees for assurance and related services in connection with the performance of the audit or the review of the Company’s financial statements. (3) Fees for professional services with respect to tax compliance, tax advice, and tax planning. (4) Fees for permissible work that does not fall within any of the aforementioned categories of audit fees, audit-related fees, or tax fees. Pre-Approval Policy for Audit and Non-Audit Services The audit committee pre-approves all audit and non-audit services before an accountant is engaged. All of the services rendered to the Company by its independent registered public auditors were pre-approved by the audit committee, and prior to the establishment of the audit committee, by the full board. ( 73 ) PART IV ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES. The Company has filed the following documents as part of this Form 10-K: 1. Consolidated Financial Statements See Index to Consolidated Financial Statement on page 28. 2. Financial Statement Schedules No financial statement schedules are included because the information is either provided in the consolidated financial statements or is not required under the related instructions or is inapplicable, and therefore such schedules have been omitted. 3. Exhibits Exhibit No. Description 3.1 Certificate of Incorporation of the Company (a) 3.1.1 Amended Certificate of Incorporation of the Company (b) 3.1.2 Series B Convertible Preferred Stock Certificate of Designation as filed with the Secretary of State of Delaware on February 27, 2020 (h) 3.1.3 Certificate Eliminating the Series A Preferred Stock as filed with the Secretary of State of Delaware on February 27, 2020 (h) 3.1.4 Series C Convertible Preferred Stock Certificate of Designation as filed with the Secretary of State of Delaware on March 1, 2021 (p) 3.2 By-Laws – Restated as Amended (a) 4.1 Amended and Restated Promissory Note, dated February 10, 2020, in the principal amount of $11,500,000, issued by MariMed Hemp Inc. and MariMed Inc. (f) 4.1.1 Promissory Note, dated February 27, 2020, in the principal amount of $3,742,500, issued by MariMed Inc. to Navy Capital Green Fund, LP (h) 4.1.2 Promissory Note, dated February 27, 2020, in the principal amount of $675,000, issued by MariMed Inc. to Navy Capital Green Co-Invest Fund, LLC (h) 4.1.3 12% Convertible Promissory Note, dated April 23, 2020, in the principal amount of $900,000, issued by MariMed Inc. to Best Buds Funding LLC (i) 4.2 Second Amended and Restated Promissory Note, dated June 24, 2020, in the principal amount of $8,811,653.84, issued by MariMed Hemp Inc. and MariMed Inc. to SYYM LLC (j) 4.3 Common Stock Purchase Warrant, dated June 24, 2020, issued by MariMed Inc.to SYYM LLC (k) 4.4 Amended and Restated Senior Secured Commercial Promissory Note, dated October 19, 2020, in the principal amount of $5,845,000, issued by MariMed Advisors, Inc. to Best Buds Funding LLC (m) 4.5 Amended and Restated Senior Secured Commercial Promissory Note, dated October 19, 2020, in the principal amount of $3,000,000, issued by MariMed Advisors, Inc. to Best Buds Funding LLC (m) ( 74 ) 4.6 Common Stock Purchase Warrant, dated September 30, 2020, issued by MariMed Inc.to Best Buds Funding, LLC. and/or its designees (m) 4.7 Amended and Restated Common Stock Purchase Warrant, dated March 18, 2021, issued by MariMed Inc. to Hadron Healthcare Master Fund * 10.1 Employment Agreement dated as of August 30, 2012 between Worlds Online Inc. and Thomas Kidrin (o) 10.2 2011 Stock Option and Restricted Stock Award Plan (a) 10.3 Form of Convertible Debenture issued by the Company (c) 10.4 Form of Secured Convertible Debenture of GenCanna Global, Inc. (c) 10.5 Form of Securities Purchase Agreement between the Company and YA II PN, LTD. (c) 10.6 Amended and Restated Registration Rights Agreement dated as of November 5, 2018 between the Company and YA II PN, LTD. (c) 10.7 Amended and Restated 2018 Stock Award and Incentive Plan (d) 10.8 Form of Stock Option Agreement, dated September 27, 2019, with each of David R. Allen, Eva Selhub, M.D., and Edward J. Gildea (e) 10.9 Amendment Agreement, dated as of February 10, 2020, between SYYM LLC, as noteholder and collateral agent, and MariMed Inc. and MariMed Hemp Inc., as co-borrowers (g) 10.10 Exchange Agreement, dated as of February 27, 2020, among MariMed Inc., Navy Capital Green Management, LLC, a Delaware limited liability company, as discretionary investment manager of Navy Capital Green Fund, LP, and Navy Capital Green Co-Invest Fund, LLC. (h) 10.11 Amendment Agreement dated June 24, 2020, between SYYM LLC, as noteholder and collateral agent, and MariMed Inc. and MariMed Hemp Inc., as co-borrowers (l) 10.12 Note Extension Agreement, effective as of September 30, 2020, among Best Buds Funding LLC, as lender, and each of MariMed Inc., Mari Holdings MD LLC, and MariMed Advisors Inc., as the borrower parties (n) 10.13 Securities Purchase Agreement, dated March 1, 2021, between MariMed Inc. and Hadron Healthcare Master Fund (p) 10.14 First Amendment to Securities Purchase Agreement, dated March 18, 2021, between MariMed Inc. and Hadron Healthcare Master Fund * 21.1 List of subsidiaries (q) ( 75 ) 23.1 Consent of M&K CPAS, PLLC, dated March 23, 2021 * 31.1. Rule 13a-14(a)/15d-14(a) Certifications of Chief Executive Officer * 31.2. Rule 13a-14(a)/15d-14(a) Certifications of Chief Financial Officer * 32.1. Section 1350 Certifications of Chief Executive Officer ** 32.2. Section 1350 Certifications of Chief Financial Officer ** 101.INS XBRL Instance Document * 101.SCH XBRL Taxonomy Extension Schema * 101.CAL XBRL Taxonomy Extension Calculation Linkbase * 101.DEF XBRL Taxonomy Extension Definition Linkbase * 101.LAB XBRL Taxonomy Extension Label Linkbase * 101.PRE XBRL Taxonomy Extension Presentation Linkbase * 104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) * * Filed herewith. ** Furnished herewith in accordance with Item 601 (32)(ii) of Regulation S-K. (a) Incorporated by reference to the same numbered Exhibit filed with the Registration Statement on Form 10-12G (File No. 000-54433) filed on June 9, 2011. (b) Incorporated by reference to Annual Report on Form 10-K for the year ended December 31, 2016, filed on April 17, 2017. (c) Incorporated by reference to Current Report on Form 8-K filed on November 9, 2018. (d) Incorporated herein by reference to Appendix A of the Company’s Definitive Proxy Statement on Schedule 14A, filed on August 26, 2019. (e) Incorporated by reference to Exhibit 10.2 filed with the Quarterly Report on Form 10-Q for the period ended September 30, 2019, filed on November 29, 2019. (f) Incorporated by reference to Exhibit 4.1 of the Current Report on Form 8-K filed on February 12, 2020. (g) Incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K filed on February 12, 2020. (h) Incorporated by reference to Current Report on Form 8-K filed on February 27, 2020. (i) Incorporated by reference to the Quarterly Report on Form 10-Q for the period ended March 31, 2020, filed on May 28, 2020. (j) Incorporated by reference to Exhibit 4.1 of the Current Report on Form 8-K filed on June 30, 2020. (k) Incorporated by reference to Exhibit 4.2 of the Current Report on Form 8-K filed on June 30, 2020. (l) Incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K filed on June 30, 2020. (m) Incorporated by reference to the same numbered exhibit of the Current Report on Form 8-K filed on October 26, 2020. (n) Incorporated by reference to Exhibit 10.13 of the Current Report on Form 8-K filed on October 26, 2020. (o) Incorporated by reference to the same numbered Exhibit filed with the Annual Report on Form 10-K for the year ended December 31, 2012 filed on March 29, 2013. (p) Incorporated by reference to the same numbered Exhibit filed with the Current Report on Form 8-K filed on March 2, 2021. (q) Incorporated by reference to the same numbered Exhibit filed with the Annual Report on Form 10-K for the year ended December 31, 2019 filed on April 1, 2020. ITEM 16. FORM 10-K SUMMARY None. ( 76 ) SIGNATURES In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized. Dated: March 23, 2021 MARIMED INC. (Registrant) By: /s/ Robert Fireman Name: Robert Fireman Title: President and Chief Executive Office In accordance with the Securities Exchange Act of 1934, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated. Signature Title Date /s/ Robert Fireman President and Chief Executive Officer March 23, 2021 Robert Fireman (Principal Executive Officer) /s/ Jon R. Levine Chief Financial Officer March 23, 2021 Jon R. Levine (Principal Financial Officer) /s/ Eva Selhub Director March 23, 2021 Eva Selhub /s/ Edward Gildea Director March 23, 2021 Edward Gildea /s/ David Allen Director March 23, 2021 David Allen ( 77 ) INDEX TO EXHIBITS Exhibit No. Description 3.1 Certificate of Incorporation of the Company (a) 3.1.1 Amended Certificate of Incorporation of the Company (b) 3.1.2 Series B Convertible Preferred Stock Certificate of Designation as filed with the Secretary of State of Delaware on February 27, 2020 (h) 3.1.3 Certificate Eliminating the Series A Preferred Stock as filed with the Secretary of State of Delaware on February 27, 2020 (h) 3.1.4 Series C Convertible Preferred Stock Certificate of Designation as filed with the Secretary of State of Delaware on March 1, 2021 (p) 3.2 By-Laws – Restated as Amended (a) 4.1 Amended and Restated Promissory Note, dated February 10, 2020, in the principal amount of $11,500,000, issued by MariMed Hemp Inc. and MariMed Inc. (f) 4.1.1 Promissory Note, dated February 27, 2020, in the principal amount of $3,742,500, issued by MariMed Inc. to Navy Capital Green Fund, LP (h) 4.1.2 Promissory Note, dated February 27, 2020, in the principal amount of $675,000, issued by MariMed Inc. to Navy Capital Green Co-Invest Fund, LLC (h) 4.1.3 12% Convertible Promissory Note, dated April 23, 2020, in the principal amount of $900,000, issued by MariMed Inc. to Best Buds Funding LLC (i) 4.2 Second Amended and Restated Promissory Note, dated June 24, 2020, in the principal amount of $8,811,653.84, issued by MariMed Hemp Inc. and MariMed Inc. to SYYM LLC (j) 4.3 Common Stock Purchase Warrant, dated June 24, 2020, issued by MariMed Inc.to SYYM LLC (k) 4.4 Amended and Restated Senior Secured Commercial Promissory Note, dated October 19, 2020, in the principal amount of $5,845,000, issued by MariMed Advisors, Inc. to Best Buds Funding LLC (m) 4.5 Amended and Restated Senior Secured Commercial Promissory Note, dated October 19, 2020, in the principal amount of $3,000,000, issued by MariMed Advisors, Inc. to Best Buds Funding LLC (m) 4.6 Common Stock Purchase Warrant, dated September 30, 2020, issued by MariMed Inc.to Best Buds Funding, LLC. and/or its designees (m) 4.7 Amended and Restated Common Stock Purchase Warrant, dated March 18, 2021, issued by MariMed Inc. to Hadron Healthcare Master Fund * 10.1 Employment Agreement dated as of August 30, 2012 between Worlds Online Inc. and Thomas Kidrin (o) ( 78 ) 10.2 2011 Stock Option and Restricted Stock Award Plan (a) 10.3 Form of Convertible Debenture issued by the Company (c) 10.4 Form of Secured Convertible Debenture of GenCanna Global, Inc. (c) 10.5 Form of Securities Purchase Agreement between the Company and YA II PN, LTD. (c) 10.6 Amended and Restated Registration Rights Agreement dated as of November 5, 2018 between the Company and YA II PN, LTD. (c) 10.7 Amended and Restated 2018 Stock Award and Incentive Plan (d) 10.8 Form of Stock Option Agreement, dated September 27, 2019, with each of David R. Allen, Eva Selhub, M.D., and Edward J. Gildea (e) 10.9 Amendment Agreement, dated as of February 10, 2020, between SYYM LLC, as noteholder and collateral agent, and MariMed Inc. and MariMed Hemp Inc., as co-borrowers (g) 10.10 Exchange Agreement, dated as of February 27, 2020, among MariMed Inc., Navy Capital Green Management, LLC, a Delaware limited liability company, as discretionary investment manager of Navy Capital Green Fund, LP, and Navy Capital Green Co-Invest Fund, LLC (h) 10.11 Amendment Agreement dated June 24, 2020, between SYYM LLC, as noteholder and collateral agent, and MariMed Inc. and MariMed Hemp Inc., as co-borrowers (l) 10.12 Note Extension Agreement, effective as of September 30, 2020, among Best Buds Funding LLC, as lender, and each of MariMed Inc., Mari Holdings MD LLC, and MariMed Advisors Inc., as the borrower parties (n) 10.13 Securities Purchase Agreement, dated March 1, 2021, between MariMed Inc. and Hadron Healthcare Master Fund (p) 10.14 First Amendment to Securities Purchase Agreement, dated March 18, 2021, between MariMed Inc. and Hadron Healthcare Master Fund * 21.1 List of subsidiaries (q) 23.1 Consent of M&K CPAS, PLLC, dated March 23, 2021 * 31.1. Rule 13a-14(a)/15d-14(a) Certifications of Chief Executive Officer * 31.2. Rule 13a-14(a)/15d-14(a) Certifications of Chief Financial Officer * 32.1. Section 1350 Certifications of Chief Executive Officer ** 32.2. Section 1350 Certifications of Chief Financial Officer ** 101.INS XBRL Instance Document * 101.SCH XBRL Taxonomy Extension Schema * 101.CAL XBRL Taxonomy Extension Calculation Linkbase * 101.DEF XBRL Taxonomy Extension Definition Linkbase * 101.LAB XBRL Taxonomy Extension Label Linkbase * 101.PRE XBRL Taxonomy Extension Presentation Linkbase * 104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) * ( 79 ) * Filed herewith. ** Furnished herewith in accordance with Item 601 (32)(ii) of Regulation S-K. (a) Incorporated by reference to the same numbered Exhibit filed with the Registration Statement on Form 10-12G (File No. 000-54433) filed on June 9, 2011. (b) Incorporated by reference to Annual Report on Form 10-K for the year ended December 31, 2016, filed on April 17, 2017. (c) Incorporated by reference to Current Report on Form 8-K filed on November 9, 2018. (d) Incorporated herein by reference to Appendix A of the Company’s Definitive Proxy Statement on Schedule 14A, filed on August 26, 2019. (e) Incorporated by reference to Exhibit 10.2 filed with the Quarterly Report on Form 10-Q for the period ended September 30, 2019, filed on November 29, 2019. (f) Incorporated by reference to Exhibit 4.1 of the Current Report on Form 8-K filed on February 12, 2020. (g) Incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K filed on February 12, 2020. (h) Incorporated by reference to Current Report on Form 8-K filed on February 27, 2020. (i) Incorporated by reference to the Quarterly Report on Form 10-Q for the period ended March 31, 2020, filed on May 28, 2020. (j) Incorporated by reference to Exhibit 4.1 of the Current Report on Form 8-K filed on June 30, 2020. (k) Incorporated by reference to Exhibit 4.2 of the Current Report on Form 8-K filed on June 30, 2020. (l) Incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K filed on June 30, 2020. (m) Incorporated by reference to the same numbered exhibit of the Current Report on Form 8-K filed on October 26, 2020. (n) Incorporated by reference to Exhibit 10.13 of the Current Report on Form 8-K filed on October 26, 2020. (o) Incorporated by reference to the same numbered Exhibit filed with the Annual Report on Form 10-K for the year ended December 31, 2012 filed on March 29, 2013. (p) Incorporated by reference to the same numbered Exhibit filed with the Current Report on Form 8-K filed on March 2, 2021. (q) Incorporated by reference to the same numbered Exhibit filed with the Annual Report on Form 10-K for the year ended December 31, 2019 filed on April 1, 2020. ( 80 )