GREY CLOAK TECH INC. (OTCMKTS:GRCK) Files An 8-K Entry into a Material Definitive Agreement

Item 1.01

Entry into a Material Definitive Agreement.

Acquisition of ShareRails, LLC and the Share Exchange
Agreement

On March 31, 2017, Grey Cloak Tech Inc. (the
Company also referred to herein as
us, we and
our), entered into a Share Exchange Agreement by
and among the Company, ShareRails, LLC, Joseph Nejman, Dmitry
Chourpo and Joseph Nejman, in his capacity as the Selling Members
Representative whereby we issued and exchanged 91,619,170 shares
of our common and 2,857,685 shares of our Series A Convertible
Preferred Stock for all of the outstanding units of ShareRails,
LLC, a Delaware limited liability company
(ShareRails). Through this exchange of
securities to the Exchange Agreement (the
Exchange), ShareRails is now our wholly-owned
subsidiary.

Following the issuance of our common stock in the ShareRails
acquisition, and certain stock exchanges as outlined below, we
have 72,508,922 shares of common stock issued and outstanding.

ShareRails provides its customers with a unique, interactive
mobile platform for connecting shoppers and retailers. ShareRails
has been operated by its two founders who will continue to work
with us and ShareRails to service their existing enterprise
clients and expand our customer base. We believe that together we
will be able to further expand our reach into the social commerce
and retail marketing industry.

As part of the Exchange, we have brought on one of ShareRails
founders, Joseph Nejman, to serve as our President and on our
Board of Directors.

The Share Exchange Agreement contains customary representations
and warranties made by the Company and by ShareRails. We may
rescind the Share Exchange Agreement if the Selling Members
Representative is unable to provide us, within 10 days of the
Exchange, a consent signed by all the members of ShareRails
whereby the members agree to participate in the Exchange and be
bound by the Share Exchange Agreement. ShareRails will indemnify
us for losses resulting from its breach of the Share Exchange
Agreement. The Share Exchange Agreement also contains other
certain terms and conditions which are common in such agreements,
and reference is made herein to the text of the Share Exchange
Agreement which will be filed in our next Quarterly Report on
Form 10-Q.

Nejman Employment Agreement

On March 31, 2017, we entered into an Employment Agreement with
Joseph Nejman, our President. to Mr. Nejmans Employment
Agreement, we have agreed to pay Mr. Nejman an annual base salary
of $140,000, and he may receive employee stock options as
determined by the Board of Directors. Any employee stock options
granted will vest immediately upon the consummation of aggregate
equity financing by the Company equal to $2,000,000 that results
from Mr. Nejmans direct efforts. Mr. Nejman is eligible to
receive a 20% commission on gross sales that are a direct result
of his sales efforts, up to a maximum of his base salary in any
calendar year. Mr. Nejmans employment is at will and either party
may terminate the agreement at any time.

If terminated without Cause or as a result of Constructive
Termination, Mr. Nejman will receive severance equal to three
months pay at his most recent Base Salary. If Mr. Nejman is
terminated for Cause, Disability or death, or voluntarily
resigns, he will not receive any severance, only unpaid salary as
of the date of termination and vested benefits. The Employment
Agreement includes non-compete and non-solicitation provisions
that apply during the term of the Employment Agreement and for a
period of one year after Mr. Nejmans termination. Capitalized
terms in this section not defined herein have the meaning given
to such terms in the Employment Agreement.

Mr. Nejmans Employment Agreement also requires that certain
proprietary information of the Company be kept confidential. The
Company will be the owner of certain intellectual property
conceived or made by Mr. Nejman prior to termination of the
Employment Agreement. Mr. Nejmans Employment Agreement also
contains other certain terms and conditions which are common in
such agreements, and reference is made herein to the text of the
Employment Agreement which will be filed in our next Quarterly
Report on Form 10-Q.

Bossung Employment Agreement

On March 31, 2017, we entered into an Employment Agreement with
William Bossung, our Chief Financial Officer. to Mr. Bossungs
Employment Agreement, we have agreed to pay Mr. Bossung an annual
base salary of $140,000, and he may receive employee stock
options as determined by the Board of Directors. Any employee
stock options granted will vest immediately upon the consummation
of aggregate equity financing by the Company equal to $2,000,000
that results from Mr. Bossungs direct efforts. Mr. Bossung is
eligible to receive a 20% commission on gross sales that are a
direct result of his sales efforts, up to a maximum of his base
salary in any calendar year. Mr. Bossungs employment is at will
and either party may terminate the agreement at any time.

If terminated without Cause or as a result of Constructive
Termination, Mr. Bossung will receive severance equal to three
months pay at his most recent Base Salary. If Mr. Bossung is
terminated for Cause, Disability or death, or voluntarily
resigns, he will not receive any severance, only unpaid salary as
of the date of termination and vested benefits. The Employment
Agreement includes non-compete and non-solicitation provisions
that apply during the term of the Employment Agreement and for a
period of one year after Mr. Bossungs termination. Capitalized
terms in this section not defined herein have the meaning given
to such term in the Employment Agreement.

Mr. Bossungs Employment Agreement also requires that certain
proprietary information of the Company be kept confidential. The
Company will be the owner of certain intellectual property
conceived or made by Mr. Bossung prior to termination of the
Employment Agreement. Mr. Bossungs Employment Agreement also
contains other certain terms and conditions which are common in
such agreements, and reference is made herein to the text of the
Employment Agreement which will be filed in our next Quarterly
Report on Form 10-Q.

Covely Information Systems Development Services
Agreement

On March 31, 2017, we entered into a Development Services
Agreement with Covely Information Systems, a company owned and
operated by Fred Covely, our Chief Executive Officer (the
Covely Agreement). to the Covely Agreement, we
have agreed to pay Covely Information Services for services
depending on monthly programming hours and hosting fees, as
billed by Covely Information Systems. Billing will be variable
and based on the income we receive from one of our clients and
other services performed on our behalf. Payment is subject to
deferment to the following month for any portion we are unable to
pay because of insufficient capital. Covely Information Systems
is an independent contractor and either party may terminate the
agreement at any time.

If the Covely Agreement is terminated for any reason, Covely
Information Systems will not receive any severance, only the
amount due for services performed prior to the date of
termination. The Covely Agreement includes non-compete and
non-solicitation provisions that apply during the term of the
Covely Agreement and for a period of one year after termination.
Capitalized terms in this section not defined herein have the
meaning given to such term in the Covely Agreement.

The Covely Agreement also requires that certain proprietary
information of the Company be kept confidential. The Company will
be the owner of certain intellectual property conceived or made
by Covely Information Systems prior to termination of the Covely
Agreement. The Covely Agreement also contains other certain terms
and conditions which are common in such agreements, and reference
is made herein to the text of the Covely Agreement which will be
filed in our next Quarterly Report on Form 10-Q.

Dimicho Pty. Ltd. Development Services Agreement

On April 1, 2017, we entered into a Development Services
Agreement with Dimicho Pty. Ltd., a company owned and operated by
Dmitry Chourpo, one of the founders and prior owners of
ShareRails (the Dimicho Agreement). to the
Dimicho Agreement, we have agreed to pay Dimicho Pty. Ltd. $8,000
per month for development and support of our software
applications and web services. The payment is subject to
deferment to the following month for any portion we are unable to
pay because of insufficient capital. Dimicho Pty. Ltd. will
dedicate no less than one full-time development resource
exclusively to our client needs, work projects and business
interest. Dimicho Pty. Ltd. is an independent contractor and
either party may terminate the agreement at any time.

If the Dimicho Agreement is terminated for any reason, Dimicho
Pty. Ltd. will not receive any severance, only the amount due for
services performed prior to the date of termination. The Dimicho
Agreement includes non-compete and non-solicitation provisions
that apply during the term of the Dimicho Agreement and for a
period of one year after termination. Capitalized terms in this
section not defined herein have the meaning given to such term in
the Dimicho Agreement.

The Dimicho Agreement also requires that certain proprietary
information of the Company be kept confidential. The Company will
be the owner of certain intellectual property conceived or made
by Dimicho Pty. Ltd. prior to termination of the Dimicho
Agreement. The Dimicho Agreement also contains other certain
terms and conditions which are common in such agreements, and
reference is made herein to the text of the Dimicho Agreement
which will be filed in our next Quarterly Report on Form 10-Q.

Section 3 Securities and Trading Markets

Item 3.02

Unregistered Sale of Equity Securities.

The disclosure in Item 1.01 above regarding the issuance of
securities in the Exchange is incorporated herein by reference.

On March 31, 2017, we issued 6,280,745 shares of common stock,
restricted in accordance with Rule 144, to Brad Holden, a former
member of ShareRails, in connection with the Exchange and to
satisfy obligations owed to Mr. Holden by ShareRails, our
wholly-owned subsidiary.

On March 31, 2017, we issued 6,607,869 and 6,699,536 shares of
Series A Convertible Preferred Stock, restricted in accordance
with Rule 144, to Fred Covely and William Bossung, respectively.

On March 31, 2017, we exchanged the following securities with the
shareholders listed:

1.

We issued 3,500,000 shares of our common stock, restricted in accordance with Rule 144, to Fred Covely in exchange for 583,333 shares of Series A Convertible Preferred Stock.

2.

We issued 4,050,000 shares of our common stock, restricted in accordance with Rule 144, to William Bossung in exchange for 675,000 shares of Series A Convertible Preferred Stock.

3.

We issued 3,166,851 shares of our Series A Convertible Preferred Stock, restricted in accordance with Rule 144, to Joseph Nejman in exchange for 19,001,105 shares of common stock.

4.

We issued 6,024,536 shares of our Series A Convertible Preferred, restricted in accordance with Rule 144, stock to Dmitry Chourpo in exchange for 36,147,215 shares of common stock.

The shares of common and preferred stock issued to the Share
Exchange Agreement and in the transactions listed above were
offered and sold in reliance on an exemption from registration to
Section 4(a)(2) of the Securities Act of 1933, as amended, and
Rule 506 of Regulation D. The investors have represented that
each is an accredited investor, as defined in Regulation D, and
has acquired the securities for investment purposes only and not
with a view to, or for sale in connection with, any distribution
thereof. The securities were not issued through any general
solicitation or advertisement.

Section 5 Corporate Governance and Management

Item 5.02

Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On March 31, 2017, Brian Dunn resigned from the Board of
Directors.

On March 31, 2017, Joseph Nejman, age 36, was appointed to our
Board of Directors and as our President, reporting to our Chief
Executive Officer. Mr. Nejman is the founder of ShareRails. Since
January 2010, as an Entrepreneur In Residence for Eric Schmidts
TomorrowVentures, Joseph led seed investments and co-founded the
Tomorrow Media incubator to focus on social commerce. Prior to
TomorrowVentures, from April 2007 to January 2010, Joseph worked
at Google in a variety of business development roles with a focus
on local markets, mobile, and entertainment. Joseph also founded
Brandcasting in March 2008 – responsible for Britney Spears
digital business and strategy. He is a proud Harvard Alum (2003)
and member of the Olympic Club lacrosse team in San Francisco.
Joseph recently participated in Swire’s blueprint B2B
accelerator program and works with major malls and brands in Hong
Kong, China, and the US.

See Item 1.01, above, for a description of the terms of our
employment agreement with Mr. Nejman, which description is
incorporated herein by reference.

See Item 1.01, above, for a description of the terms of our
employment agreement with Mr. Bossung, which description is
incorporated herein by reference.

Item 5.03

Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.

In connection with the Exchange, our Board of Directors
designated a new class of preferred stock, the Series A
Convertible Preferred Stock, and on April 6, 2017, we filed a
Certificate of Designation of the Rights, Preferences, Privileges
and Restrictions of the Series A Convertible Preferred Stock (the
Certificate of Designation) with the Secretary
of State of the State of Nevada. The Certificate of Designation
provides for the issuance of up to 25,000,000 shares of Series A
Convertible Preferred Stock, par value $0.001 per shares (the
Series A Preferred Stock).

The Certificate of Designation provides, among other things, that
holders of Series A Preferred Stock shall receive noncumulative
dividends on an as-converted basis at the same time and in the
same form as any dividends paid out on shares of our common
stock. Other than as set forth in the previous sentence, the
Certificate of Designation provides that no other dividends shall
be paid on Series A Preferred Stock. Dividends on the Series A
Preferred Stock are not mandatory or cumulative. There are no
sinking fund provisions applicable to the Series A Preferred
Stock and the Series A Preferred Stock is not redeemable.

In the event of any liquidation, dissolution or winding up of the
Company, the Series A Preferred Stock will be paid prior and in
preference to any payment or distribution on any shares of common
stock, or subsequent series of preferred stock, an amount per
share equal to the Original Issue Price of the Series A Preferred
Stock and the amount of any accrued or declared but unpaid
dividends.. The Original Issue Price is set at $0.40 per share
for the Series A Preferred Stock. The holders of the Series A
Preferred Stock will then receive distributions along with the
holders of the common stock on a pari passu basis according to
the number of shares of common stock the Series A Preferred
holders would be entitled if they converted their shares of
Series A Convertible Preferred Stock at the time of such
distribution.

As long as any shares of Series A Preferred Stock remain
outstanding, the Certificate of Designation provides that the
Company shall not, without the affirmative vote of holders of a
majority of the then-outstanding Series A Preferred Stock, (a)
alter or change adversely the powers, preferences or rights given
to the Series A Preferred Stock or alter or amend the Certificate
of Designation, (b) increase the number of authorized shares of
Series A Preferred Stock or (c) effect a stock split or reverse
stock split of the Series A Preferred Stock or any like event.

Each share of Series A Preferred Stock is convertible at any time
at the holder’s option into six (6) fully paid and nonassessable
shares of our common stock and is subject to adjustment for stock
splits, stock dividends, distributions, subdivisions, capital
reorganization, reclassification and combinations.

Each share of Series A Preferred Stock is entitled to six (6)
votes per share on all matters to which the shareholders of the
Company are entitled or required to vote. The holders of the
Series A Preferred Stock are entitled to vote on all matters on
which the holders of common stock are entitled to vote.

Without the approval of a majority of the holders of the
outstanding Series A Preferred Stock, we may not (i) alter or
change the rights, preferences, or privileges of the Series A
Convertible Preferred Stock, (ii) increase or decrease the number
of authorized shares of Series A Convertible Preferred Stock, or
(iii) authorize the issuance of securities having a preference
over or on par with the Series A Preferred Stock.

This foregoing description of the Certificate of Designation does
not purport to be complete and is qualified in its entirety by
reference to the complete text of such certificate, a copy of
which is filed herewith as Exhibit 3.1.

Section 9 Financial Statements and Exhibits

Item 9.01

Financial Statements and Exhibits.

(d)Exhibits

3.1

Certificate of Designation of the Series A Convertible Preferred Stock, dated March 31, 2017

About GREY CLOAK TECH INC. (OTCMKTS:GRCK)

Grey Cloak Tech Inc. is engaged in developing a cloud-based software to detect advertising fraud on the Internet. The Company’s cloud-based product, Fraudlytic, is a secure platform that detects, analyzes and destroys bots while allowing consumer traffic to click and view digital advertisements. Fraudlytic’s suite of filters detects various permutations of digital advertising fraud, including cookie stuffing, advertisement stacking, and domain spoofing to allow advertisers to regain control of their advertising budget. Its software application has been uploaded to the Amazon cloud and the overall system runs over My Structured Query Language (MySql) instances using the Amazon storage area network (SAN) for storage of the data. Its TrueClick Compliance product includes the features of the basic TrueClick package with the addition of a selective online marketing feature, which is useful for regulated industries in state or federal compliance.

GREY CLOAK TECH INC. (OTCMKTS:GRCK) Recent Trading Information

GREY CLOAK TECH INC. (OTCMKTS:GRCK) closed its last trading session up +0.005 at 0.125 with shares trading hands.