Exhibit 10.1

 

November 8th, 2018

 

 

Christopher Tedford

19381 St. Mary’s Dr.

North Tustin, CA 92705

 

 

Dear Mr. Tedford:

 

Congratulations! We are very pleased to offer you a position with KUSHCO
HOLDINGS, INC., a Nevada corporation (the “Company”) as a Chief Financial
Officer (CFO). Your employment is subject to the terms and conditions set forth
in this letter.

 

This letter is to confirm our understanding with respect to your future
employment by KushCo Holdings or any present or future parent, subsidiary,
affiliate or successor thereof (collectively, the “Company”). The terms and
conditions agreed to in this letter are hereinafter referred to as the “Offer”.
In consideration of the mutual promises and covenants contained in this Offer,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby mutually acknowledged, we have agreed as follows:

 

Employment

 

Subject to the terms and conditions of this Offer, you will be employed by the
Company as a full-time Chief Financial Officer (CFO), reporting to Nick
Kovacevich, CEO. You will have the responsibilities, duties and authority
commensurate with the position of Chief Financial Officer (CFO), as determined
by the Officers and/or Board from time to time. You agree to devote your full
business time attention and best efforts to the performance of your duties and
to the furtherance of the Company’s interests during your employment.

 

Subject to the terms hereof, your employment hereunder will commence on November
26th, 2018 (the “Commencement Date”). Your employment with the Company is deemed
to be “At Will” and can be terminated by the Company or you at any time without
prior notice or without reason.

 

The principal location at which you will perform such services will be Garden
Grove, CA.

 

Compensation

 

While you are employed hereunder, you will be paid as an exempt status employee
with a base salary at the annual rate of $250,000.00 (the “Base Salary”). The
Base Salary will be payable bi-weekly installments in accordance with the
Company’s payroll practices as in effect. The Company will deduct from each such
installment any amounts required to be deducted or withheld under applicable law
or under any employee benefit plan in which you participate.

 

 

 

 

Bonus

 

You will be eligible to earn up to a total of $100,000.00 in bonus compensation
annually and any other discretionary incentives as approved by the Board and the
KushCo Holdings’ Leadership Team. Following six (6) months from the Commencement
Date of this agreement, you will be eligible to receive $50,000.00 in guaranteed
bonus compensation based on KIPs to be outlined following the Commencement Date.
The remaining $50,000.00 will be paid based on the standard fiscal year bonus
cycle. Following fiscal year 2019, all bonuses will be paid in accordance with
the standard annual schedule.

 

Equity Compensation

 

On November 26th, 2018 subject to Board and any other necessary approvals, you
will be granted 600,000 options to purchase shares of the Company’s common stock
at a strike price equivalent to the closing stock price on the date of grant.

 

The options granted to you shall vest or accrue, as applicable, over a
three-year period as follows: (i) 33% shall be deemed vested or accrued, as
applicable, on November 26th, 2019 and none before this date; and (ii) the
balance of the Option Shares will be vested in a series of twenty-four (24)
successive equal monthly installments. Should your employment terminate before
the passage of the next 12 months, the options granted to you shall not be
deemed vested, accrued, or exercisable. All terms and conditions of the stock
option shall be governed by the terms and conditions of the applicable option
agreement, which you will be required to sign. These terms include a “change in
control” clause that would accelerate the option vesting period.

 

Vacation

 

You will be entitled to fifteen (15) paid vacation days per year along with paid
holidays and personal days in accordance with the Company’s policies as in
effect from time to time.

 

Benefits

 

If this offer is accepted and you begin employment with the Company, you will be
eligible to participate in any benefit plans and programs in effect from time to
time, including group medical and life insurance and disability benefits, and
other fringe benefits as are made available to other similarly situated
employees of the Company, in accordance with and subject to the eligibility and
other provisions of such plans and programs.

 

Reimbursement of Expenses

 

The Company shall reimburse you for all reasonable out-of-pocket expenses
incurred by you in connection with the performance of your duties in accordance
with its regular reimbursement policies as in effect from time to time and upon
receipt of itemized vouchers and such other supporting information as dictated
by the Board-approved policies of the Company.

 

 

 

 

Confidentiality Agreement

 

You shall be required to execute a Confidentiality and Non-Competition Agreement
and remain subject to the Confidentiality and Non-Competition Agreement between
you and the Company dated as of on or about the date hereof. The Confidentiality
and Non-Competition Agreement will survive termination of your employment with
the Company (regardless of the reason, if any, of such termination).

 

Contingencies

 

This offer of employment is contingent upon the satisfactory completion of the
following:

 

(a)Verification of your right to work in the United States, as demonstrated by
your completion of the I-9 form upon hire and your submission of acceptable
documentation (as noted on the I-9 form) verifying your identity and work
authorization within three days of starting employment.

 

(b)Your execution of the Company’s form of Employee Proprietary Information and
Inventions Agreement.

 

(c)Satisfactory completion of a background investigation & reference checks.

 

This offer will be withdrawn if any of the above conditions are not satisfied:

 

By accepting this offer, you confirm that you are able to accept this job and
carry out the work that it would involve without breaching any legal
restrictions on your activities, such as restrictions imposed by a current or
former employer. You also confirm that you will inform the Company about any
such restrictions and provide the Company with as much information about them as
possible, including any agreements between you and your current or former
employer describing such restrictions on your activities. You further confirm
that you will not remove or take any documents or proprietary data or materials
of any kind, electronic or otherwise, with you from your current or former
employer to the Company without written authorization from your current or
former employer. If you have any questions about the ownership of particular
documents or other information, discuss such questions with your former employer
before removing or copying the documents or information.

 

You will be subject to all applicable employment and other policies of the
Company, as outlined in the Company’s employee handbook and elsewhere. Your
employment will be at-will, meaning that you or the Company may terminate the
employment relationship at any time, with or without cause, and with or without
notice.

 

 

 

 

All of us at the Company are excited at the prospect of you joining our team. If
you have any questions about the above details, please call me immediately. If
you wish to accept this position, please sign below and return this letter
agreement to me within three business days. This offer is open for you to accept
until November 8th, 2018 at which time it will be deemed to be withdrawn.

 

I look forward to hearing from you.

 

Yours sincerely,

 

/s/ Nick Kovacevich

 

Nick Kovacevich

 

Chief Executive Officer

 

 

Accepted and Approved

 

 

By: /s/ Christopher Tedford   Christopher Tedford   Date: 11/8/18