THCT THC Therapeutics Inc (CE)

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On April 2, 2021, Parker Mitchell was terminated as the Chief Executive Officer of THC Therapeutics, Inc. (the “Company”), and Brandon Romanek was appointed as the Company’s Chief Executive Officer. Mr. Romanek, age 46, has been the Company’s President, Chief Financial Officer, Secretary and Director, since January 12, 2017, and was the Company’s Chief Executive Officer from January 12, 2017, until December 11, 2020.

Mr. Romanek’s employment agreement, a copy of which has been filed as Exhibit 10.6 to the Company’s recent periodic reports and is incorporated by reference herein, remains in effect. In accordance with the employment agreement, Mr. Romanek provides services to the Company in exchange for $178,000 per year plus vacation and bonuses as approved annually by the board of directors, as well as reimbursement of expenses incurred. Pursuant to the employment agreement, Mr. Romanek’s employment can be terminated by either the Company or Mr. Romanek at any time, but if the Company terminates Mr. Romanek for a reason other than total disability or “Cause” or if Mr. Romanek terminates his employment for “Good Reason” in the absence of Cause, then the Company is obligated to pay Mr. Romanek (i) a severance payment equal to 18 months’ salary plus one years’ incentive compensation bonus, and (ii) a pro rata portion of the bonus that Mr. Romanek would have received for the portion of the year that Mr. Romanek was employed, and any unvested equity compensation awards will immediately vest. “Cause” is generally defined as (i) willful failure to perform material duties, (ii) willful and gross misconduct, (iii) conviction or plea of no contest to the commission of a felony or any misdemeanor that is a crime of moral turpitude, (iv) breach of the non-competition, non-solicitation or confidentiality covenants in the employment agreement, or (v) any other willful act having the intended effect of injuring the reputation, business or business relationships of the Company or its affiliates. “Good Reason” is generally defined as a (i) a material reduction in the employee’s base salary or a material reduction in annual incentive compensation opportunity, in each case other than any isolated or inadvertent failure by Company that is not in bad faith and is cured within 30 business days after the employee gives Company notice of such event, (ii) a material diminution the employee’s title, duties and responsibilities, other than any isolated or inadvertent failure by Company that is not in bad faith and is cured within 30 business days after the employee gives Company notice of such event, (iii) a transfer of the employee’s primary workplace by more than 50 miles from his current workplace, or (iv) the failure of a successor to the Company to have assumed the employment agreement obligations in connection with any sale of the business. If there is a change of control of the Company (generally defined as the sale or other disposition of substantially all of the Company’s property, assets or business or a merger or similar transaction with another entity in which more than 50% of the voting power of the Company is disposed of), Mr. Romanek will have the option to terminate his employment, and such termination will be considered a termination by the Company for reasons other than Cause (meaning that Mr. Romanek would be entitled to the severance and prorated bonus described above, and any unvested equity compensation awards would immediately vest). As disclosed in the Company’s prior Annual Reports on Form 10-K, the Company has leased office and living space from Mr. Romanek for $3,500/month for several years, and the Company currently leases approximately 2,000 square feet of approximately 5,000 square feet of mixed-use office and living space from Mr. Romanek for $3,500/month, including utilities.

The foregoing description of the employment agreement, which does not purport to be complete, is qualified in its entirety by reference to the employment agreement, which is filed as Exhibit 10.6 hereto, and incorporated by reference herein.