Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
On December 24, 2021 (the "Effective Date"), the Board of Directors of Trulieve
Cannabis Corp. (the "Company") appointed Steven M. White as President of the
Company. Kim Rivers, the Company's Chief Executive Officer and principal
executive officer, will no longer serve as President of the Company as of the
Effective Date.
Mr. White co-founded the Company's subsidiary, Harvest Health & Recreation Inc.
("Harvest") in 2012 and served as a director and chief executive officer of
Harvest until the closing of the Company's acquisition of Harvest on October 1,
2021. Mr. White founded and serves on the board of directors of Harvesting Hope,
a non-profit organization that supports young children suffering from seizure
disorders. Prior to Harvest, Mr. White practiced law at his own boutique law
firm, which he founded in 2005. Prior to founding his own firm, Mr. White
practiced business, business litigation and regulatory law for two national law
firms beginning in 1999. Mr. White earned a Bachelor of Science in Political
Science from Arizona State University and a J.D. from Washington & Lee
University, School of Law.
On the Effective Date, the Company entered into an Executive Employment
Agreement with Mr. White (the "Employment Agreement") pursuant to which
Mr. White's employment will be on an at-will basis, he will be paid an annual
base salary of $375,000 and he will be eligible for an annual bonus targeted at
70% of his base salary based on the achievement of certain Company and
individual performance goals to be established by the Compensation Committee of
the Company's Board of Directors. Upon achievement of superior performance
against goals by both the Company and Mr. White, Mr. White will be eligible to
receive a bonus equal to 140% of his base salary. The Employment Agreement also
includes standard confidentiality, non-competition, non-solicitation,
non-disparagement and intellectual property assignment provisions.
Mr. White will also be eligible to receive certain severance benefits in
connection with a termination of his employment by the Company without Cause or
by him for Good Reason (as defined in the Employment Agreement), subject to
execution of a general release of claims. If such termination occurs, Mr. White
shall be entitled to receive the sum of (a) two (2) times the sum of his base
salary in effect on the date of termination plus the greater of the target bonus
for the current fiscal year and the actual annual bonus paid during the prior
fiscal year and (b) a prorated annual bonus for the current fiscal year, which
shall be payable in equal installments over a twenty-four (24) month period in
accordance with the Company's regular payroll practices and subject to all
customary withholding and deductions ("Severance"). In addition, the Company
will pay COBRA premiums for Mr. White (and his dependents) until the earlier of
(i) the twenty-four (24) month anniversary of his termination date; and (ii) the
date on which he either receives or becomes eligible to receive substantially
similar coverage from another employer. Any unvested equity awards held by
Mr. White shall also immediately vest; provided that any equity award that is
still subject to performance based vesting at the time of such termination will
only vest when and to the extent the Compensation Committee certifies that the
performance goals are actually met.
If the Company terminates Mr. White's employment without Cause or he terminates
his employment for Good Reason within twenty-four (24) months following a Change
of Control (as defined in the Employment Agreement), then he shall receive the
same severance described above, except that (i) the Severance shall be equal to
the sum of (A) two and 1/2 (2.5) times the sum of the base salary in effect on
the date of termination plus the greater of the target bonus for the current
fiscal year and the actual annual bonus paid during the prior fiscal year and
(B) a prorated annual bonus for the current fiscal year, and shall be payable as
a lump sum (rather than installments) on the Company's first regular payroll
date following the delivery of the general release of claims and conclusion of
the revocation period and (ii) the COBRA continuation coverage shall be for a
period of twenty-four (24) months.
Except as set forth in the Employment Agreement, there are no arrangements or
understandings between Mr. White and any other persons pursuant to which he was
appointed as President of the Company, there are no family relationships among
any of the Company's directors or executive officers and Mr. White and he has no
direct or indirect material interest in any transaction required to be disclosed
pursuant to Item 404(a) of Regulation S-K.
As previously disclosed by Harvest, Harvest issued two secured promissory notes
to Harvest of Ohio LLC, which is owned 49% by Mr. White. The first secured
promissory note was issued in February 2020 in the original principal amount of
$5.0 million, accrues interest at a rate of 6% per annum due at maturity and
will mature 18 months after the entity receives all three certificates of
operation to commence medical marijuana dispensary operations in Ohio and the
second secured promissory note was issued in February 2021 in the original
principal amount of $3.0 million, accrues interest at a rate of 17% per annum
due at maturity and will mature 30 months after the entity receives all three
certificates of operation to commence medical marijuana dispensary operations in
Ohio.
The foregoing summary of the Employment Agreement is not complete and is
qualified in its entirety by reference to the full text of such agreement, a
copy of which is attached as Exhibit 10.1 to this Current Report on Form 8-K and
is incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
Exhibit
No. Description
10.1 Executive Employment Agreement dated December 24, 2021 by and
between Trulieve Cannabis Corp. and Steven M. White
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document)
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