Item
5.02. Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers
On
June 1, 2019, the Board of Directors (the “Board”) of Verus International, Inc. (the “Company”) appointed
Christopher Cutchens as Chief Financial Officer of the Company, effective immediately.
Since
June 2018, Christopher Cutchens has served as the Managing Partner of Cutchens Group, LLC, a consulting firm specializing in providing
operational and financial services to both public and private companies. From September 2018 until June 2019, Mr. Cutchens
served as Chief Operating Officer and Chief Financial Officer of DirectView Holdings, Inc., a company that provides security and
surveillance and video conference services. From January 2016 until June 2018, Mr. Cutchens served as Executive Vice President,
Chief Operating Officer and Financial Officer of MidAmerica Administrative & Retirement Solutions, LLC, a private company
that provides employee benefit programs to plan sponsors and employees. From January 2013 to January 2016, Mr. Cutchens served
as Executive Vice President and Chief Financial Officer of Aspire Financial Services, LLC (“Aspire”), and from April
2012 to January 2013, he served as Vice President of Accounting and Finance of Aspire. Aspire is a service provider of retirement
solutions. In addition, Mr. Cutchens has served in various other capacities including Corporate Controller of Watsco, Inc. (NYSE:
WSO); Corporate Controller of Carrier Enterprise, LLC; Director of Corporate Accounting and Financial Reporting and Assistant
Corporate Controller of MarineMax, Inc. (NYSE: HZO); and Senior Auditor at KPMG LLP. Mr. Cutchens received a Bachelor of Science
degree in accounting and a masters degree in accounting information systems from the University of South Florida. Mr. Cutchens
is a CPA licensed in the State of Florida.
On
June 1, 2019 (the “Effective Date”), the Company entered into an employment agreement (the “Employment Agreement”)
with Christopher Cutchens pursuant to which Mr. Cutchens will serve as Chief Financial Officer of the Company. Pursuant to the
terms of the Employment Agreement, Mr. Cutchens will receive a base salary of $75,000 per year, which base salary shall increase
to $150,000 at such time that the Company completes a capital raise in excess of $3,000,000. Mr. Cutchens’ base salary shall
be subject to annual review and increase by the Company beginning on November 1, 2020. Mr. Cutchens shall also be eligible to
receive an annual performance-based bonus based upon the attainment of certain goals established by the Company. The bonus shall
not exceed 50% of Mr. Cutchens’ then base salary. In addition to the foregoing, Mr. Cutchens received 30,000,000 shares
of the Company’s common stock which shall vest 25% on the six month, 1 year, 2 year and 3 year anniversaries of the Effective
Date. Mr. Cutchens is also entitled to participate in any and all benefit plans in effect for senior executives of the Company,
along with vacation, sick and holiday pay in accordance with the Company’s policies established and in effect from time
to time.
The
Company or Mr. Cutchens may terminate the Employment Agreement at any time and for any reason; provided, however, Mr. Cutchens
must provide at least 30 days prior written notice of his termination. In addition, the Company may terminate Mr. Cutchens’
employment with or without Cause (as defined in the Employment Agreement). In the event the Company terminates Mr. Cutchens’
employment without Cause (as defined in the Employment Agreement) and if Mr. Cutchens executes a general release of all claims
against the Company and its affiliates, which release is not revoked, then, Mr. Cutchens shall receive the following: (i) if Mr.
Cutchens has been employed by the Company between 12 and 23 months, six months of his then base salary; (ii) if Mr. Cutchens has
been employed by the Company for at least 24 months, twelve months of his then based salary; and (iii) COBRA benefits. In the
event Mr. Cutchens terminates his employment with the Company for any reason, he shall be entitled to receive (i) any portion
of his then base salary not paid through the date of termination; (ii) reimbursement of expenses incurred on or prior to the termination
date; (iii) any accrued but unused vacation pay; (iii) any pro-rated and unpaid portion of the annual bonus Mr. Cutchens is entitled
to as of the termination date; and any amount arising from Mr. Cutchens’ participation in, or benefits under, any benefit
plans.
The
foregoing description of the Employment Agreement is qualified in its entirety by reference to the full text of the Employment
Agreement, a copy of which is attached hereto as Exhibit 10.1 and is incorporated herein by reference.
There
are no family relationships between Mr. Cutchens and any of our directors or executive officers. Except as set forth herein, there
is no arrangement or understanding between Mr. Cutchens and any other persons pursuant to which Mr. Cutchens was appointed an
executive officer of the Company. There are no related party transactions involving Mr. Cutchens that are reportable under Item
404(a) of Regulation S-K.