Exhibit 10.6
l": •UNUSUAL ௭ MACHINES tec hn olo g y advanci ng with us October 6, 2022 Br i an Hoff 16000 Hamilton Way B ro omfie l d, Co lorad o 80023 Re: Offe r Lette r for the Position of Ch i ef F i nancia l Officer at Unusual M ach i nes, Inc. Dea r B rian , I am p l eased to offer you the position of Ch i ef Financia l Officer for Unusual Mac hi nes, Inc . ("Company") comme n c in g November 1 , 2022 (the "Effective Date"), r eport i ng d ir ect l y to the Company's Chief Executive Off i cer . I am c onfident that t hi s position w ill p r ovide you wit h an exce ll ent opportunity for s ig nif i can t professional sat i sfaction and I am confident that the relationship w ill be a mutua ll y rewarding one . This l etter, if accepted by you, sets forth our agreement regarding the mate ri al terms and condit i ons of yo ur emp l oyment by the Company and may be referred to as the Emp l oyment Agreement . l . Respons ibilities . As a key p l ayer i n the Company's growth, yo u will be r espons i b l e for managing all aspects of the Company's f i sca l and fiduciary responsib ili ties . You wi ll estab li sh a nd maintain best in class fi nance and accounting teams r equired fo r a forward - thinking company that plans to grow s i gnificant l y . You wi ll a l so be respons i ble for ensur in g successfu l acq ui sitions and public offer i ngs . You wi ll report directly to the Company's Chief Executive w ill perform your duties and Broomf i eld, Co l orado with the to trave l from t ime - to - t im e as Off i ce r. Un l ess otherw i se agreed, you responsibili t i es from your hom e off i ce in unders tand ing that you may be requ ir ed r easonab l y necessary to perform your job . 2. Indem ni fication . The Company sha ll , to the maximum extent permitted by l aw, indemn i fy, defend and hold you harm l ess from and against any claims that be asserted aga i nst you based upon any act i ons and/or decisions you make during the course and scope of yo ur emp l oyment wh i ch are take n or
2 made in good faith in ca rrying our job duties and responsibili ties . To the same extent, the Company will pay, and subject to any legal limitations, advance to yo u all expenses, including reasonable attorneys' fees and costs, actually and necessarily incurred by you in connection wit h the defense of any action, suit or proceeding and in connection with any appeal, which has been brought against you by reason of your service as an officer or agent of the Company . 3 . Compensation and Benefits. 3.7 Salary. You will be compensated at the rate of $250,000 per year in base salary paid in accordance with the Company's normal payroll schedule and processes. 2. Performance Bonus . You will be eligib l e to earn an annual bonus of 50 % of your annual base salary (the "Pe rformance Bonus"), wh i ch wi ll be prorated based on your start date . Within 30 days of your start date, you wi ll work with the Chief Exec utive Officer and the Board of Directors to agree upon and draft key performance indicators ("KPls") upon w hich your annual Performance Bonus w ill be based . Annual Performance Bonuses will be paid to you within 720 days of the fiscal yea r end or upon the determination of your achievement of the KP ls by the Chief Executive Officer and Board of Directo rs, whichever i s sooner . 3. Benefits . You wi ll ha ve the same compre h ensive emp lo yee benefits package enjoyed by all the C - suite executives of the Company, including group medical and dental insur ance, and the 40 l(k) program, subject to the eligibility r equi rem ents of each such p lan . You wi ll be expected to work w ith the Chief Executive Officer to id ent i fy and implement those benefit plans for the Company by the end of CY 2022 . You w ill be reimbursed for a ll health insurance costs you incur prior to impl ementat ion of the new Company benefits plans . 4. E quity Grant . Subject to Board app ro va l , you will be granted restricted stock units (RSUs) under the Company's equ i ty in ce nti ve plan, which RSUs w ill represent 7 % of the issued and outstanding cap ita l stoc k of the Company on a fu lly diluted basis as of the grant date . The RSUs w ill begranted to you no later than 30 days following the earlier of (i) the closing of the Roto r Riot, LLC and Fat Sha rk Holdings, Ltd . acquisition transactions, or (ii) the date on which the Company reasonably determines that the acqu i s it ion transactions wi ll not proceed to c lo si n g . Twenty - five percent ( 25 % ) of the R S U s w il l vest on the 72 - month anniversary of your emp lo yment s tart date, twenty five percent ( 25 % ) of the RSUs will vest on t h e 24 - month anniversary of your employment start date, twenty - five percent ( 25 % ) of the RSUs w ill vest on the 36 - month ann i versary of your emp l oyme nt start date , and the remaining
3 twenty - five pe r cent (25%) of the RSUs w il l vest on the 48 - month anniversary of you r emp l oyment start date, 5. Acquisi t ion Bonus/ Cap i ta l Ra i se Bonus . You are e l ig i b l e for cash and equity bonuses upon each successfu l acquisition completed by the Company . Upon each successfu l acqu i s i t i on completed by the Company, you w il l receive a bonus in an amount up to $ 725 , 000 (the "Acquis i tion Bonus") . Each Acqu i s i tion Bonus sha ll be paid in a l ump sum w i thin 30 days fo ll owing a determinat i on of e li g i bi l ity by the Ch i ef Executive Officer and the Boa r d of Directors . You w ill a l so be e l igib l e for a bonus of $ 725 , 000 upon the comp l et i on of a capital raise event (e . g . , a secondary offer i ng on the NASDAQ, a pr i vate p l acement offer i ng, an at - the - marked ("ATM") offering, a private investment in pub li c equ i ty ("PIPE") offering, etc . ) (the "Capital Raise Bonus") . The Capital Ra i se Bonus shal l be paid in a lump sum w i th i n 30 days fo ll owing a determ i nation of e l ig i b ili ty by the Chief Execut i ve Officer and the Board o f D ir ectors . 6. Vacat i on . Our Company offers un l im i ted paid vacation . You will work w i t h the Chief Execut i ve Officer in advance to coordinate expected time off . 7. Severance Benefits. See Section 5.3 be l ow. 4 . At - Wi ll E mp l oy m e n t Subject to the prov i sions of this Section 4 , your employment w i th the Company is for no spec i fied period and i s cons i dered to be at - wi l l . You are free to resign your employment at any time, for any r eason or fo r no reason, and the Company is free to terminate its emp l oyment relationsh i p with yo u at any time, with or without any reason . 4 . 7 T erminat i on by Mutual Agreement . T h i s Employment Agreement, and your emp l oyment hereu n der, may be terminated at any t i me upon the mutua l written agreement of you and the Company . 2. Termination due to Death or Disabil i ty . This Emp l oyment Agreemen t and your employment hereunder w il l terminate automatica ll y upon your death and may be terminated by the Company in the event of your D i sab il ity . For purposes of this Emp loyment Agreement , "Disabi l ity" means a physica l or mental d i sability that prevents you from perform i ng your du ties hereunder , w i th or without reasonable accommodat i on, lasting for a period o f one hundred ( 100 ) consecutive days or for a p e riod of one hundr e d twe nty - five ( 725 ) days in any twe l ve - mon th period . 3. Te rmination by the Company . The Company may terminate th i s Em p l oyment Agreement and your emp l oyment hereunder with or w i thout
4 Ca u se . Fo r pu rp oses o f t h i s Ag r eeme n t , "Cause" means : ( i ) your r ef u sa l , or fa ilur e, to pe r fo r m you r ma te ri a l dut i es u nd e r t hi s Emp l oymen t Ag r eement that a r e (A) co n s i stent wit h you r ro l e a s Ch i ef F i nancia l O ffi ce r , and (B) not ill ega l or u n e thi ca l , which refusal o r fa i lure co n t i n u es fo r a pe ri o d of th i r t y ( 30 ) days a ft er you h ave rece i ved written not i ce from t h e Company descr i bing i n r easonable de t a il t h e mate ri a l d ut i es you h ave r efused or fa il ed to pe r fo r m and the c u re requeste d b y the Company, prov i ded you r right to cure w ill not apply i f t h e c ir c u mstances a n d consequences o f yo ur refusa l o r fa ilur e to perform do n ot pe r m i t a reaso n ab l e c ur e ; ( ii ) you h ave e n gaged i n w il lf ul m i sconduct or gross n eg li ge n ce, or have breac h ed any f i duc i a r y duty, wit h r espect to the Company ; ( i i i ) yo u h ave been co n v i cte d of, o r you have enter e d a p l ea of g uil ty o r no l o contende r e to , a fe l ony , o r any ot h e r cr i m i na l offense invo l v i ng moral tu rpi tude ; ( i v) yo u have committed any other act or om i ss i on i nvo l v i ng dis h onesty, d i s l oya l ty or fraud, w hi c h h as caused, o r i s reasonab l y expected to cause, s i g ni fican t econ o m i c ha r m to t h e Company ; o r (v) you h ave comm i tted a mate ri a l b reac h o f th i s Emp l oyment Ag r ee m ent o r a mater i al w ri tte n po l icy of t h e Company to w h ich you a r e sub j ect o r any ot h e r mate r ial w r itten agree m ent betwee n you a nd t h e Co mp a n y, wh i c h is not reasonab l y cu r ed by you w i th i n th i rty ( 30 ) days of yo u r r ece i pt of a w ri tte n notice fr om the Company desc ri b i ng in reasonab l e deta il the v i o l at i on o r b r eac h and the cure re q uested by t h e Company . In a n y in st an ce whe r e advanced notice and an oppor t un i ty t o cure i s req ui red a ccord i ng to t h e fo r ego i ng te r ms, the Company must g i v e n o ti ce no l ater t ha n 30 days after t h e Co m pany becomes aware of t h e r e l evant act o r om i ss i on, and i t must te r m i nate your emp l oyment no l ate r t han 90 days afte r s u ch date by de li ve rin g a Not i ce of T ermina ti on i n accordance w i th Sect i on 4 . 5 be l ow . 4 . 4 Te rmin at i o n by You . You may te r m i nate t his Emp l oyment Agree m e n t an d you r e m p l oymen t h ereun d er w it h o r wit h o u t Good Reason . For purposes of t h is Emp l oy m ent Ag r eeme n t, "Good Reason " means the occu rr ence of any o f the fo ll owing e vents w i t h out your p ri o r wr i tte n consen t : ( i ) any r ed u ct i o n i n your base sa l ary, (ii ) any mater i a l d i m i nut i on i n you r author i t i es, t it l es o r offices, or the ass i gnment to you of duties t h a t mater i a ll y i mpai r your ab ilit y to perfo r m the dut i es no r ma ll y ass i gn e d to a Chief F i nanc i a l Officer, ( ii i) any c h ange i n yo ur r e porting s truct u re so that you r e po r t to s omeone ot h e r t h an to t h e Comp a ny ' s C h i ef Execut i ve Off i cer; ( i v) a requ est by t h e C omp a ny t h at yo u r e l ocate so t hat you c an pe r form your j o b duties and respons i bi li t i es from a l ocat i on ot h e r t h an you r c u rr ent home off i ce ; or (v) any mater i a l b r each by th e Company o f the E mp l oyment Ag r eem e nt or any othe r materia l wri tt en agr ee ment b e tw e en you and t h e Company (in c l uding for th e avo i dan c e of doub t , any e qui t y doc um e n t s ) ; s o l ong as (A) wr i tten not i ce , i n r eas onab l e detai l , describ i ng t h e e v e n t c on s t i tut i ng Good Reason (the "G oo d R eason Eve n t") h as b ee n deliv e red to t h e Company w i t h i n 30 d ays aft e r y ou first becom e awa r e of th e Good Reason E ven t , (B) th e Company hasbee n g i ve n
5 30 days after receipt of suc h w ritt e n notice to c ur e such Good Reason Event (and , if the Company cures such Good Reason Event w i th in such 30 - day period, there shall be no Good Re a son for term i nat ion ), and (C) you te r minate th i s Em plo yment Agreement and your emp lo yment hereunder w ithin 90 days following the date you r f irs t became aware of such Good Reason Event by delivering a No t ic e of Ter m ina t i on in accordance wit h Sect ion 4 . 5 below . 4 . 5 Notice of T erm ination . Any te rmina t i o n of th is Emp lo yment Ag r ee men t and you r emp lo yment hereunder , other t h an by reason of your death, shall be commun i cated by the party te rmina t ing t his Emp l oyment Agreement to the other party by w ri tten Notice of Termination . For purposes of t hi s Employment Ag r eement, a "Not ice of Termina t ion " means a wr itten notice that (i) indi cates the spec ifi c provision in this Employment Agreem ent being relied upon for such termination, (ii) to the extent applicable, sets forth in r easonab l e d eta il t he facts and c ir cumstances c laim ed to provide a ba s i s fo r the te rmin at i on of yo ur em plo yme nt under the provision so indicated, and ( iii ) specifies t he Date o f T e rmin at i on (as d efined below) . The failure by you or t he Company to set for th in the Notice of T e rmin ation any fact or circumstance that co n t rib utes to a s ho w ing of Cause or Good Reason, respectively, shall not wa i ve any right that you or the Company has hereunder or preclude your or t h e Company from asserti n g such fact or c ir cumstance in enforcing yo ur or the Company's righ ts hereunder . 5 . Compensation and other Benefits Upon Termination. 5.1 T erm i nat ion upon the Mutua l Agreement of t h e Pa r t i es : T erm in at i on as a Result of You r Death or Disability: Termination by the Company for Cause: T erm in at ion by Youfo r a Reason other t h an Good Reason . Upon the termination of yo ur emp l oyment pursuant to Section 4. 1 [t e rmin at ion upon the mu tua l ag r ee m e n t of the pa r t i es), Sect i on 4.2 [ te rmin at i on as a result of you r death or disabili ty], Sect i on 4 .3 [te r m ina t i on by the Company fo r Ca u se ], or Section 4.4 [ term in ation by you fo r a reason other than Good Reason], you s hall be entitled t o receive (l) any base sala r y earned but u np a i d as of the date of term i nat i o n , (2) any Pe rforman ce Bonus, Acqu i sit ion Bonus and/or Cap i ta l Ra i se Bonus whic h has been ea rned and determined as of t h e dat e of termination but not yet paid , an d (3) any a uth or i zed bus i ness expenses tha t were inc urred bu t not reimbu r sed as of the date of termination . 5 . 2 Term i nat i on by th e Company wi th out Cause : Term i nation by You for Good Reaso n . In t h e event t he Company term in ates yo ur emp l oym e nt w ith out Cause pu r sua nt to Sect i on 4 . 3 above, o r in the event you termina t e you r emp l oyment fo r Good Reason pur s uant to Sect i on 4 . 4 above, you sha ll be ent itl e d to r ece ive ( 7 ) any base sa l ary earned but unpa id as of t h e dat e o f
6 termination, ( 2 ) any Performance Bonus, Acqu i s i t i on Bonus and/or Cap i tal Ra i se Bonus wh i ch has been earned and determined as of the date of termination but not yet paid, and ( 3 ) any authorized bus in ess expenses that we r e in cur r ed but not r e imbur sed as of the date of termination . I n addition , you wi ll be ent i t l ed to r eceive the fo ll ow in g severance benefits : 1. You w ill be entitled to severance pay equal to si x ( 6 ) months of your base sa l ary as of the date of your terminat i on . Theseve r ance w ill be paid i n the form of sa lar y contin u at i on during the six - month period im mediate l y fo ll ow in g you r term inati on pursuant to the Company's norma l payroll schedu l e and practices . 2. The Company w ill reimburse you fo r your COBRA premiums during the s i x ( 6 ) month period imm ed iatel y fol l ow i ng your employment te rmination date . 3. Th e vest ing of your unvested RSUs w ill be accele ra ted such tha t 50 % of your RSUs that we r e no t yet vested im med i ately prior to your e m p l oyment te r m in at i on date wi ll be deemed fu lly vested as of your employment term in at i on date . 6. Other Conditions . 1. The Compa n y w ill furnish you a l aptop and cell phone w here a ll you r Company business i s expected to be transacted . No us e of personal l aptop or ce ll pho n e i s permitted . 2. Your dutie s are expected to in clude extensive travel to achieve the objectives of the Company . This may be se l f - i n i t i ated travel o r at the direc tio n of th e C hief Exec uti ve Off icer . As a cond i t i o n of emp l oyment, yo u ag r ee to s i gn t hi s Emplo yment Agreement no l ater than the October 15 , 2022 and pass a criminal background chec k . I look forward to your d ec i s i on regarding your new position at the Company and I am confi d ent that the r elatio n sh ip w ill be a mutua ll y re wa rdin g one . Please l et me k n ow your d ec i s i on in due t im e . I n add i t i on, please ind i cate yo ur acceptance of the te r ms and condit i o n s set fo r th i n this E mployment Agreement by s i gning and returning . T h anks!
Regards, 7 Unusua l Machines, Inc. /i Brandon Torres Declet CEO & Chairman of the Board
AGREED AND ACCEPTED Brian Hoff 8 Date: Oc - le,l:,er Zt> 22. .
