Item 1.01 Entry into a Material Definitive Agreement.

On November 9, 2022, Kaival Brands Innovations Group, Inc., a Delaware corporation (the "Company"), entered into a Fourth Amendment to Service Agreement (the "Amendment") with QuikfillRx, LLC ("QuikfillRx"), the third party vendor responsible for executing the Company's marketing and sales strategies. The Amendment amends that certain Service Agreement, dated March 31, 2020, between the Company and QuikfillRx (as previously amended, the "Service Agreement"). The Amendment provides for the following material changes to the Service Agreement:

1. The term of the Service Agreement is extended for a three-year period ending October 31, 2025, subject to automatic one-year extensions, unless the Service Agreement is terminated earlier pursuant to its terms.

2. QuikfillRx will adopt "Kaival Marketing Services" as its "doing business as" name to more properly reflect the commitment of QuikfillRx to the Company's business.

3. QuikfillRx will be entitled to a monthly cash fee of $125,000 (prior to the Amendment, the monthly cash fee was $150,000).

4. QuikfillRx was granted a one-time, fully vested, ten-year non-qualified option award to purchase up to 250,000 shares of Company common stock with an exercise price of $0.9869 per share (the closing price of the Company's common stock on November 9, 2022) (the "Exercise Price"). Such option grant was memorialized pursuant to a Nonqualified Option Agreement, dated November 9, 2022, between the Company and QuikfillRx (the "Nonqualified Option Agreement").

5. QuikfillRx was granted a ten-year non-qualified option award to purchase up to 3,000,000 shares of Company common stock with an exercise price equal to the Exercise Price, The options granted pursuant to this award are subject to annual vesting based on total net revenues and profit margins (which metrics are subject to adjustment in certain cases involving the Company's products) achieved by the Company from QuickfillRx's efforts over the term of the Service Agreement (as amended), with a maximum vesting to occur upon achievement of $180,000,000 in total net revenues reported within the three-year term. Such option grant was memorialized pursuant to a Performance-Based Nonqualified Option Agreement, dated November 9, 2022, between the Company and QuikfillRx (the "Performance-Based Option Agreement"). The options granted pursuant to the Performance-Based Option Agreement will fully vest upon a change of control event involving the Company (as described in the Performance-Based Option Agreement).

The options issued to QuickfillRx pursuant to the Nonqualified Option Agreement and the Performance-Based Option Agreement were issued under and subject to the terms of the Company's Amended and Restated 2020 Stock and Incentive Compensation Plan.

The Amendment, the Nonqualified Option Agreement and the Performance-Based Option Agreement are filed as Exhibits 10.1, 10.2 and 10.3, respectively, to this Current Report on Form 8-K and are incorporated by reference herein.

On November 15, 2022, the Company issued a press release regarding the execution of the Amendment. Such press release is filed as Exhibit 99.1 hereto and incorporated by reference.





Exhibit No. Description
10.1+         Fourth Amendment to Service Agreement, dated November 9, 2022 between
            the Company and QuikfillRx
10.2          Nonqualified Stock Option Grant Agreement, dated November 9, 2022,
            between the Company and QuikfillRx
10.3          Performance-Based Option Agreement, dated November 9, 2022, between
            the Company and QuikfillRx
99.1          Press release of the Company, dated November 15, 2022, announcing the
            Amendment
104         Cover Page Interactive Data File (embedded within the Inline XBRL
            document)

+ Certain portions of this exhibit (indicated by "[***]") have been omitted pursuant to Regulation S-K, Item 601(b)(10).as the Company has determined they are both not material and are of the type that the Company treats as private or confidential.

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