Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. OnJanuary 15, 2021 , the Compensation Committee (the "Committee") of the Board of Directors (the "Board") ofKushCo Holdings, Inc. (the "Company") approved the Executive Severance Plan (the "Plan") ofKIM International Corporation , a subsidiary of the Company, to provide severance benefits to certain Executives (as defined in the Plan) whose employment withKIM International Corporation , the Company, and any direct or indirect majority-owned subsidiary of either (collectively, the "Company Group ") is involuntarily terminated without Cause (as defined in the Plan). The Plan provides that all of the policies and practices of theCompany Group providing for severance benefits or similar payments upon employment termination to participants in the Plan, which includes all executives at or above the level of Vice President who are employees on the payroll of theCompany Group , and who has been designated by the Board or the Committee as a participant in the Plan (the "Participants"), other than written employment or separation agreements entered into afterJanuary 15, 2021 (the "Effective Date"), with theCompany Group that provide severance benefits, will be superseded by the Plan. As provided by the Plan, a Participant whose employment is terminated without Cause, subject to their execution of a valid and effective release of any and all claims against theCompany Group in a form and manner provided by theCompany Group and return of allCompany Group property to the Company, will be entitled to receive the following benefits: •Cash Severance Payment - The Participant will be entitled to cash severance equal to the Participant's monthly rate of base salary or base wages earned on a monthly basis ("Base Pay") multiplied by (i) in the case of the Chief Executive Officer 18 months, and (ii) in the case of all other Participants, nine months (the applicable period, the "Severance Period"). The cash severance payment will be paid in periodic installments according to the Company's standard payroll practices over the duration of the Severance Period; provided, that such payments will not commence until the first payroll period as soon as practicable following the Release Effective Date (as defined in the Plan). •Bonus -If the Participant is eligible for an annual bonus opportunity ("Annual Bonus") under the Company's (or a subsidiary's) bonus program in which the Participant participates for the bonus cycle in which the Participant's date of termination occurs, in lieu of such Annual Bonus, the Participant will receive a pro rata award based on the number of days in the applicable bonus cycle during which the Participant was employed, assuming performance at "target". Such bonus severance will be paid as soon as practicable following the Release Effective Date. •Outplacement Services - The Participant will be eligible for reasonable senior executive outplacement services, provided by a vendor chosen by the Company or applicable subsidiary and at the Company's or applicable subsidiary's expense, after the Participant's termination of employment for the duration of his or her Severance Period. A Participant's right to any benefit provided under the Plan will not be subject to liquidation or exchange for another benefit, and the amount of such benefit that the Participant receives in one taxable year will not affect the amount of such benefits that the Participant receives in any other taxable year. •Continued Health Care Coverage - The Participant will be entitled to a cash payment in an amount equal to the applicable COBRA premium payments (as reasonably determined by the Committee as of the time of Participant's termination of employment) that would be payable by the Participant to continue the Participant's company-provided medical, dental, and/or vision coverage for the Participant and any dependents covered at the time of termination, for the number of months set forth below: •Chief Executive Officer: 18 months; •Chief Financial Officer, Chief Operations Officer,Chief People Officer , General Counsel: 12 months.
Such cash payment will be made regardless of whether the Participant actually elects coverage under COBRA, and will be determined as of the Participant's termination of employment and not impacted by, or adjusted for, events occurring after such date (including, without limitation, changes in coverage or premiums). The amount will be aggregated and paid in equal installments according to the Company's standard payroll practices over the Severance Period; provided, that such payments will not commence until the first payroll period as soon as practicable following the Release Effective Date.
As defined by the Plan, "Cause" has the meaning set forth in any employment
equity grant or similar agreement between the Participant and the
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misuse of confidential information; (f) involvement in activities representing
material conflicts of interest with the
A Participant will not be required to mitigate the amount of any payments
provided to them under the Plan by seeking employment or otherwise. All
severance payments under the Plan will be subject to legal deductions, and
benefits payable under the Plan may be offset by any advanced monies the
Participant owes the
The foregoing description of the Plan does not purport to be complete and is subject to, and qualified in its entirety by reference to, the full text of the Plan, a copy of which is attached hereto as Exhibit 10.1 and which is incorporated herein by reference. Item 9.01. (d) Exhibits. Exhibit Title Number 10.1Kim International Corporation Executive Severance Plan, effectiveJanuary 15, 2021 .
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