XML 33 R21.htm IDEA: XBRL DOCUMENT v3.19.1
Note 15 - Management Changes
12 Months Ended
Dec. 31, 2018
Disclosure Text Block [Abstract]  
Note 15 - Management Changes

NOTE 15 – MANAGEMENT CHANGES

 

On August 28, 2018, the Board of Directors (the “Board”) appointed Todd Lee as President of the Company.  In connection therewith, Scott A. Cox began serving as Vice President of Corporate Development, effective immediately.

 

Termination and Severance Agreement for Mark T. Mersman

 

On September 18, 2018, the Board terminated the Company’s employment agreement with Mark T. Mersman, Chief Executive Officer of the Company (the “Mersman Termination”) and Mr. Mersman was removed as a member of the Board, effective September 18, 2018. The Company appointed Todd Lee as the Company’s Principal Executive Officer.  In connection with the Mersman Termination, Mr. Mersman and the Company entered into a Separation Agreement (the “Mersman Severance Agreement”), effective September 24, 2018.

 

Pursuant to the terms of the Mersman Severance Agreement, the Company will pay Mr. Mersman all of his earned but unpaid salary, which, as of September 18, 2018, amounts to $32,655 as well as twelve (12) monthly payments of $12,500, commencing on December 1, 2018.  The severance payments were accrued in September 2018.  All of Mr. Mersman’s unvested options that were outstanding as of September 18, 2018 immediately vested as of September 24, 2018.  The Mersman Severance Agreement prohibits Mr. Mersman from selling more than two percent (2%) of the shares of common stock beneficially owned by him during any thirty (30) day period between October 1, 2018 through March 31, 2019, and more than five percent (5%) of the shares of common stock beneficially owned by him in any thirty (30) day period thereafter.  In exchange for these cash payments, Mr. Mersman agreed to a general release in favor of the Company.  As of December 31, 2018, the payable to Mr. Mersman was $137,500.

 

Termination and Severance Agreement for Scott A. Cox

 

On September 18, 2018, the Board terminated the Company’s employment agreement with Scott A. Cox, Vice President of Corporate Development (the “Cox Termination”).  In connection with the Cox Termination, Mr. Cox and the Company entered into a Separation Agreement (the “Cox Severance Agreement”), effective September 24, 2018.

 

Pursuant to the terms of the Cox Severance Agreement, the Company will pay Mr. Cox all of his earned but unpaid salary, which, as of September 18, 2018, amounts to $32,297, as well as twelve (12) monthly payments of $12,500, commencing on December 1, 2018.  The severance payments were accrued in September 2018.  All of Mr. Cox’s unvested options that were outstanding as of September 18, 2018 immediately vested as September 24, 2018.  The Cox Severance Agreement prohibits Mr. Cox from selling more than two percent (2%) of the shares of common stock beneficially owned by him during any thirty (30) day period between October 1, 2018 through March 31, 2019, and more than five percent (5%) of the shares of common stock beneficially owned by him in any thirty (30) day period thereafter.  In exchange for these cash payments, Mr. Cox agreed to a general release in favor of the Company.  As of December 31, 2018, the payable to Mr. Cox was $137,500.

 

On October 4, 2018, Mr. Lee resigned as President of the Company, effective immediately.  As a result of Mr. Lee’s resignation, the Interim Services Agreement, dated August 6, 2018, between the Company and Mr. Lee has been mutually terminated as of the effective date of Mr. Lee’s resignation.

 

On October 5, 2018, the Board appointed Mr. Robert Bench, the Company’s Chief Financial Officer, to serve as the Interim President of the Company and designated Mr. Bench as the Company’s Principal Executive Officer, effective immediately, until such time as his successor is named.  Mr. Bench will continue to serve as Chief Financial Officer of the Company during the interim period.    

 

On October 17, 2018, the Board appointed Dr. John A. MacKay as the President of its subsidiary Elevated and as President of its wholly-owned subsidiary 5Leaf. The Board authorized Elevated and 5Leaf each to enter into an employment agreement with Dr. MacKay. 

 

Dr. MacKay’s employment agreement with Elevated (the “Elevated Agreement”) provided that Dr. MacKay will receive a salary of $3,000 per month. The term of the Elevated Agreement is from October 22, 2018 until December 31, 2018 subject to extension as mutually agreed upon by the parties. The Elevated Agreement also provides that Dr. MacKay will receive an aggregate of 10% of the capital stock of Elevated at the rate of 3% the end of the first year, 3% the end of the second year, and 4% the end of the third year so long as he remains as an employee of Elevated. 

 

Dr. MacKay’s employment agreement with 5Leaf (the “5Leaf Agreement”) provided for a salary of $10,000 per month. The term of the 5Leaf Agreement is from October 22, 2018 until December 31, 2018 subject to extension as mutually agreed upon by the parties. The 5Leaf Agreement also provides that Dr. MacKay will receive membership interests equal to an aggregate of 3% of 5Leaf’s outstanding membership interests at the rate of 1% the end of each year so long as he remains as an employee of 5Leaf.   

 

On December 31, 2018, Dr. MacKay entered into an Employment Agreement effective as of January 2, 2019 with the Company which replaces and supersedes any and all previous employment or consulting services agreements with the Company or any of its subsidiaries. The Agreement provides for a salary of $10,000 per month. The term of the Agreement is from January 2, 2019 until December 31, 2021 subject to extension as mutually agreed upon by the parties. The Agreement also provides a Sign on Bonus of 200,000 shares to be issued subsequent to the Effective Date.