Last Revised: August 3, 2026
THIS IS A BUSINESS-TO-BUSINESS SERVICE AVAILABLE ONLY TO LICENSED CANNABIS OPERATORS. BUDDY CLEARING IS A TRANSACTION-FACILITATION AND CLEARINGHOUSE PLATFORM. WE ARE NOT A PARTY TO ANY TRANSACTION BETWEEN MEMBERS, DO NOT TAKE TITLE TO OR POSSESSION OF ANY CANNABIS PRODUCT, AND DO NOT FACILITATE THE TRANSPORT OF CANNABIS OR CANNABIS PRODUCTS ACROSS STATE LINES. ALL TRANSFERS FACILITATED THROUGH THE SERVICES MUST OCCUR ENTIRELY WITHIN A SINGLE STATE IN COMPLIANCE WITH THAT STATE’S CANNABIS REGULATORY FRAMEWORK.
SECTION 14 OF THESE TERMS GOVERNS THE RESOLUTION OF DISPUTES BETWEEN YOU AND US AND REQUIRES, WITH LIMITED EXCEPTIONS, THAT DISPUTES BE RESOLVED THROUGH BINDING ARBITRATION ON AN INDIVIDUAL BASIS. PLEASE READ SECTION 14 CAREFULLY.
These Terms of Service (the “Terms”) are a binding legal agreement between you, on behalf of the licensed cannabis business you represent (“you,” “your,” or “Member”), and [Buddy Clearing Legal Entity Name, e.g., “Buddy Clearing, LLC”] (“Buddy Clearing,” “we,” “us,” or “our”), governing your access to and use of the website located at buddyclearing.com and all related services (collectively, the “Services”). By requesting membership, creating an account, or otherwise accessing the Services, you agree to be bound by these Terms and by our Privacy Policy, which is incorporated by reference.
IF YOU DO NOT AGREE TO ALL OF THESE TERMS, YOU MAY NOT ACCESS OR USE THE SERVICES.
Buddy Clearing is a business-to-business financial technology company. We provide software, transaction-facilitation tools, and administrative clearing services that allow licensed cannabis businesses to identify counterparties and execute compliant inventory transfers with one another. Buddy Clearing itself does not cultivate, process, distribute, possess, or sell cannabis or cannabis products in any form, and does not require a cannabis cultivation, processing, distribution, or retail license under any state’s cannabis regulatory framework as a condition of operating this technology platform.
Buddy Clearing is not:
Buddy Clearing’s role is limited to providing the technology platform, transaction facilitation tools, and administrative support that allow Members to identify counterparties, negotiate terms, and execute compliant transfers directly between one another’s licenses. All cannabis product transfers occur directly between Members’ licensed facilities, and all compliance obligations under state and local law relating to the physical handling, tracking, and transfer of cannabis product remain solely with the Members involved in that transfer.
Because Buddy Clearing’s revenue is derived from fees calculated on cannabis-related transactions, we are treated by our banking partners as a cannabis-ancillary business, and we maintain our commercial accounts with FDIC-insured financial institutions that knowingly and compliantly provide banking services to cannabis and cannabis-ancillary businesses, consistent with applicable Bank Secrecy Act and FinCEN guidance.
In addition to our own operating accounts, Buddy Clearing coordinates transaction-specific escrow sub-accounts on behalf of Members through these same banking partners, as described in Sections 3.4 and 12. Escrowed Member funds are held directly by our banking partners and are never commingled with Buddy Clearing's own operating funds.
This is a deliberate compliance posture, not an incidental one: we do not attempt to obscure the nature of our business from our banking partners.You acknowledge that federal cannabis banking reform (including the proposed SAFE Banking Act) has not been enacted into law as of the date of these Terms, and that banking access for cannabis and cannabis-ancillary businesses remains subject to evolving federal guidance and each institution’s own risk and compliance posture. Buddy Clearing does not guarantee uninterrupted access to any particular banking relationship and reserves the right to modify its payment processing and banking arrangements as needed to maintain compliance.
To become a Member and use the Services, you must:
Membership is by application only. Submitting a “Request Access” application does not guarantee approval. Buddy Clearing reserves the right, in its sole discretion, to approve, deny, or revoke membership at any time, including based on license status, standing with state regulators, or any violation of these Terms.
You agree to promptly notify us if your license is suspended, revoked, or expires, and you acknowledge that continued use of the Services with an invalid license is a material breach of these Terms.
Buddy Clearing provides tools for Members to list available inventory (e.g., dry flower, biomass, vapes, or other cannabis products eligible for wholesale transfer under applicable state law) and to identify and connect with other Members seeking to buy or sell such inventory.
Where applicable, Buddy Clearing provides administrative support in connection with the creation of compliant Metrc (or equivalent state track-and-trace system) manifests and package transfers between Members. As part of this support, upon a transaction being matched and escrow conditions satisfied under Section 3.4, Buddy Clearing may generate a pre-filled CSV file formatted to match the Seller's Metrc manifest requirements, populated using the item, batch, and package data provided by the Seller during listing.
This CSV file is provided solely as an administrative convenience to reduce manual data entry. Members remain solely responsible for reviewing the accuracy of any pre-filled manifest data before uploading it into Metrc or any other state compliance system, and for the accuracy of all information ultimately submitted to state regulators under their own license. Buddy Clearing is not responsible for compliance errors, mismatched package data, or regulatory consequences arising from a Member's use of an auto-generated manifest file, including errors that originate from inaccurate data the Member provided during listing.
Buddy Clearing charges a transaction fee, disclosed to Members prior to completing a transaction, generally ranging from 2% to 10% of the transaction value depending on product category. Fees are calculated and invoiced as described in the Services and are non-refundable once a transaction has been completed, except as required by law.
Buyer funds for transactions facilitated through the Services are settled through segregated escrow sub-accounts maintained at Buddy Clearing's FDIC-insured banking partners. Upon a Buyer initiating a transaction, Buddy Clearing provides the Buyer with unique, transaction-specific ACH or wire settlement instructions issued by our banking partner. Funds remitted by the Buyer are held in a segregated sub-account at the banking partner — not commingled with Buddy Clearing's operating funds, and not held or controlled by Buddy Clearing directly — until the transaction conditions are satisfied.
Once funds are verified as secured in escrow, Buddy Clearing authorizes release of the applicable Metrc-formatted transfer manifest to the Seller. Upon confirmation that the manifest has been issued and the physical transfer has been initiated in accordance with these Terms, Buddy Clearing instructs our banking partner to disburse the escrowed funds to the Seller, less Buddy Clearing's transaction fee as described in Section 3.3.
Buddy Clearing is not a bank, trust company, or money transmitter, and does not itself take custody or control of Member funds. All escrowed funds at all times remain in the custody of Buddy Clearing's FDIC-insured banking partner, subject to that institution's own compliance, security, and account terms. Members authorize Buddy Clearing to issue settlement and disbursement instructions to our banking partner on their behalf as necessary to complete transactions facilitated through the Services.
As a Member, you represent, warrant, and agree that:
You acknowledge that cannabis remains classified as a Schedule I controlled substance under the federal Controlled Substances Act, and that state-legal cannabis activity remains illegal under federal law. Buddy Clearing operates strictly within the confines of intrastate commerce as permitted under applicable state law and takes no position on, and assumes no responsibility for, the federal legal status of any Member’s business.
You must maintain the accuracy of your account information and safeguard your login credentials. You are responsible for all activity that occurs under your account. Notify us immediately at contact@buddyclearing.com if you suspect unauthorized access to your account.
You may not use the Services to:
We reserve the right to suspend or terminate your membership immediately, without notice, for violation of this Section.
Buddy Clearing and its licensors own all right, title, and interest in the Services, including all software, design, trademarks, and content, excluding any Member-submitted listing content. You may not copy, modify, distribute, or create derivative works from the Services without our prior written consent.
THE SERVICES ARE PROVIDED “AS IS” AND “AS AVAILABLE.” BUDDY CLEARING MAKES NO WARRANTY THAT THE SERVICES WILL BE UNINTERRUPTED, ERROR-FREE, OR SECURE, AND DISCLAIMS ALL IMPLIED WARRANTIES, INCLUDING MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, AND NON-INFRINGEMENT, TO THE FULLEST EXTENT PERMITTED BY LAW. BUDDY CLEARING DOES NOT WARRANT OR GUARANTEE THE QUALITY, LEGALITY, OR COMPLIANCE OF ANY PRODUCT LISTED OR TRANSACTED BY MEMBERS THROUGH THE SERVICES.
TO THE FULLEST EXTENT PERMITTED BY LAW, BUDDY CLEARING AND ITS OFFICERS, DIRECTORS, EMPLOYEES, AND AGENTS SHALL NOT BE LIABLE FOR ANY INDIRECT, INCIDENTAL, SPECIAL, CONSEQUENTIAL, OR PUNITIVE DAMAGES ARISING FROM YOUR USE OF THE SERVICES OR ANY TRANSACTION FACILITATED THROUGH THE SERVICES. IN NO EVENT SHALL BUDDY CLEARING’S TOTAL LIABILITY TO YOU EXCEED THE GREATER OF (A) THE FEES PAID BY YOU TO BUDDY CLEARING IN THE THREE (3) MONTHS PRECEDING THE CLAIM, OR (B) $500.
You agree to indemnify, defend, and hold harmless Buddy Clearing and its officers, directors, employees, and agents from any claims, damages, losses, and expenses (including reasonable attorneys’ fees) arising from: (a) your breach of these Terms; (b) your violation of any law or regulation, including cannabis licensing and compliance requirements; (c) any transaction you enter into with another Member; or (d) your negligence or willful misconduct.
We may suspend or terminate your access to the Services at any time, with or without cause, including if we believe your continued participation poses a legal, regulatory, or reputational risk to Buddy Clearing. You may terminate your membership at any time by notifying us in writing.
Buddy Clearing is not a bank, trust company, or licensed money transmitter. Buddy Clearing does not itself hold, custody, or take control of Member funds at any point in a transaction. As described in Section 3.4, all Buyer funds are held in segregated escrow sub-accounts maintained directly by Buddy Clearing's FDIC-insured banking partners, and all disbursements are executed by those banking partners upon Buddy Clearing's instruction, not by Buddy Clearing itself.
Buddy Clearing's role with respect to funds is limited to: (a) coordinating the issuance of transaction-specific settlement instructions generated by our banking partners; (b) verifying that escrow conditions described in Section 3.4 have been satisfied; and (c) instructing our banking partners to release or disburse escrowed funds accordingly. At no point does Buddy Clearing directly receive, hold, or possess Member funds in its own accounts.
Members acknowledge that the escrow and settlement services described in these Terms are provided through Buddy Clearing's banking partners and are subject to those institutions' own account terms, compliance procedures, and applicable banking regulations, in addition to these Terms.
These Terms are governed by the laws of the State of [INSERT STATE — e.g., New York], without regard to conflict-of-law principles, except that disputes involving a Member’s cannabis license shall additionally be subject to that Member’s state cannabis regulatory framework.
PLEASE READ THIS SECTION CAREFULLY. IT AFFECTS YOUR LEGAL RIGHTS.
Any dispute arising out of or relating to these Terms or the Services shall be resolved through binding arbitration administered by [JAMS/AAA — to be determined with counsel] on an individual basis, and not as part of any class, collective, or representative action. Either party may bring an individual claim in small claims court instead of arbitration, where jurisdictionally appropriate. This arbitration agreement is governed by the Federal Arbitration Act.
[This section should be finalized with counsel to determine the appropriate arbitration body, rules, and any state-specific carve-outs.]
Severability. If any provision of these Terms is found unenforceable, the remaining provisions remain in full force.
Assignment. You may not assign these Terms without our prior written consent. We may assign these Terms in connection with a merger, acquisition, or sale of assets.
Entire Agreement. These Terms, together with the Privacy Policy, constitute the entire agreement between you and Buddy Clearing regarding the Services.
No Waiver. Our failure to enforce any provision of these Terms is not a waiver of our right to do so later.
Questions about these Terms can be directed to: info@buddyclearing.com