Greenlane Holdings, Inc. appointed Nicholas Kovacevich as new CEO

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


The information provided in the Introductory Note is incorporated herein by reference.


Appointment of Nicholas Kovacevich as Chief Executive Officer


As previously disclosed, as of the effective time of Merger 1, Mr. Kovacevich was appointed as the Chief Executive Officer of Greenlane. Mr. Kovacevich replaces Aaron LoCascio, who will remain with Greenlane as President of the Company. Mr. Kovacevich previously served as KushCo's Chief Executive Officer.


The following is a biographical summary for Mr. Kovacevich:


Nicholas Kovacevich: Mr. Kovacevich served as a director and Secretary of KushCo from its inception in December 2010 until the closing of the Mergers. Mr. Kovacevich served as Chief Operating Officer of KushCo from December 2010 until August 29, 2014, at which time he was appointed Chief Executive Officer of KushCo. Mr. Kovacevich was appointed Chairman of the board of directors of KushCo in November 2017. Mr. Kovacevich graduated Summa Cum Laude from Southwest Baptist University with a Bachelor of Science in Sports Management. After college, Mr. Kovacevich began his entrepreneurial career by building and selling Pack My Dorm. He continued on to found several other successful businesses including BigRentz, Inc., a leading online equipment rental company, and Alpha West Holdings, a diversified holding company whose portfolio businesses' generate a combined $100M+ in annual sales. Recently, Kovacevich was appointed to California's 32nd DAA Orange County Fair Board by California Governor Newsom.


In connection with his appointment, the Company entered into an indemnification agreement with Mr. Kovacevich, which is in substantially the same form as that entered into with the Company's executive officers and directors serving prior to the consummation of the Mergers.


Pursuant to the terms of the Merger Agreement, Mr. Kovacevich received 2,799,612 shares of Greenlane Class A common stock as consideration for the shares of KushCo common stock he owned immediately prior to the effective time of Merger 1.


Appointment of Rodrigo De Oliviera as Chief Operating Officer


As previously disclosed in the Company's Current Report on Form 8-K filed with the SEC on June 17, 2021, Rodrigo De Oliviera's appointment as Greenlane's Chief Operating Officer became effective upon the closing of the Mergers.


In connection with his appointment, the Company entered into an indemnification agreement with Mr. De Oliviera, which is in substantially the same form as that entered into with the Company's executive officers and directors serving prior to the consummation of the Mergers.


Pursuant to the terms of the Merger Agreement, Mr. De Oliviera received 99,447 shares of Greenlane Class A common stock as consideration for the shares of KushCo common stock he owned immediately prior to the effective time of Merger 1.


Appointment of Directors


In connection with the consummation of the Mergers and pursuant to the terms of the Merger Agreement, immediately following the effective time of Merger 1, the size of Greenlane's Board of Directors (the "Board") was increased from five members to seven members and Nicholas Kovacevich, the former Chief Executive Officer of KushCo, Don Hunter, a former member of the KushCo board of directors, and Dallas Imbimbo, a former member of the KushCo board of directors, were elected to the Board, each to serve until the next annual meeting of stockholders of the Company and until their successors have been duly elected and qualified. As previously disclosed, Neil Closner, a former director of Greenlane, provided a resignation letter to the Board that became effective upon the closing of the Mergers.


As the Chief Executive Officer of Greenlane, Mr. Kovacevich will receive no separate compensation for his service as a director of the Company.


As independent members of the Board, each of Mr. Hunter and Mr. Imbimbo will be entitled to certain compensation that all of the Company's independent directors receive, including an annual retainer of $60,000 (pro-rated for the remainder of 2021), certain meeting fees, be eligible for awards under Greenlane's Amended and Restated 2019 Equity Incentive Plan and reimbursement for reasonable out-of-pocket expenses incurred in attending Board and committee meetings.


In connection with their appointment, the Company entered into an indemnification agreement with each of Mr. Hunter and Mr. Imbimbo, which is in substantially the same form as that entered into with the Company's executive officers and directors serving prior to the consummation of the Mergers.


Neither Mr. Kovecevich, Mr. Hunter, Mr. Imbimbo nor any member of their immediate family has or had a direct or indirect interest in any transaction in which the Company or any of its subsidiaries is or was a participant that would be required to be disclosed under Item 404(a) of Regulation S-K.


Pursuant to the terms of the Merger Agreement, Mr. Hunter received 22,199 shares of Greenlane Class A common stock as consideration for the shares of KushCo common stock he owned immediately prior to the effective time of Merger 1 and Mr. Imbimbo received 3,021,362 shares of Greenlane Class A common stock as consideration for the shares of KushCo common stock he owned immediately prior to the effective time of Merger 1.


The following are biographical summaries for Messrs. Hunter and Imbimbo:


Donald Hunter: Mr. Hunter served as a director of KushCo from February 1, 2018 until the closing of the Mergers. Since 2007, Mr. Hunter has served as principal at Donald Hunter, LLC, a consulting practice that assists private equity firms and entrepreneurs to enhance the value of their technology companies. He previously served as Chief Operating Officer and Chief Financial Officer of Harbor Global Company Limited, a publicly traded investment management, natural resources, and real-estate company, from 2000 through 2006, and as a senior executive at The Pioneer Group, Inc. from 1988 through 2000, with responsibility for international start-up companies. Mr. Hunter began his career at the General Electric Company, where he was a member of the corporate audit staff and a graduate of its Financial Management Training Program. Since 2013, Mr. Hunter has served as a member of the board of directors of The LGL Group, Inc., a NYSE-listed frequency and spectrum control engineering and manufacturing company, and also serves as the Chairman of the Audit Committee and a member of the Nominating Committee, and formerly served on the Compensation Committee. Previously, Mr. Hunter served as a member of the board of directors, Chairman of the Audit Committee and member of the Nominating Committee of Juniper Pharmaceuticals, a NASDAQ-listed specialty pharmaceuticals company, from March 2014 through March 2016, and a member of the board of directors of LICT Corporation, a holding company with subsidiaries in telecommunications and multimedia, from June 2014 through June 2015. Mr. Hunter qualifies as a financial expert under the applicable rules of the Securities and Exchange Commission (the "SEC") and is an active member of the National Association of Corporate Directors. He holds a Bachelor of Science, magna cum laude, and an MBA with high honors from Boston University.


Dallas Imbimbo: Mr. Imbimbo was one of the co-founders of KushCo, has served as Chairman of KushCo since its inception in December 2010 through November 2017, and served as a director of KushCo until the closing of the Mergers. In addition to his role at KushCo, Mr. Imbimbo co-founded BigRentz, Inc. in 2012, one of the nation's largest construction equipment rental networks. Under his leadership as President and Chief Executive Officer from inception through April 2017, BigRentz has become one of the fastest growing companies in Southern California. Mr. Imbimbo continues to serve on the board of directors of BigRentz. In 2017. Mr. Imbimbo founded an investment firm, Alpha West Holdings, specializing in investments of early stage companies and providing support and the framework needed to help their management teams succeed.


Committee Assignments 


Following the appointment of Mr. Kovacevich, Mr. Hunter and Mr. Imbimbo, the Board approved the following committee assignments:


· Audit Committee: Jeff Uttz, a current member of the Board, Richard Taney, a current member of the Board, and Mr. Imbimbo. 


· Compensation Committee: Mr. Taney, Mr. Uttz and Mr. Hunter. 


· Nominating and Corporate Governance Committee: Mr. Imbimbo, Mr. Taney and Mr. Uttz. 


Appointment of Chairman of the Board 


The Board has agreed to appoint an independent Chairman of the Board no later than September 30, 2021. Aaron LoCascio will remain the Chairman of the Board until that time.