CitroTech Inc. 8-K

What Happened

• CitroTech Inc. announced that Chief Technology Officer Stephen Conboy resigned effective March 31, 2026 and entered a Transition Agreement to become an outside advisor to the CEO. The Transition Period runs March 31, 2026 through June 30, 2026; during that time Conboy will not run daily operations or bind the company but will help transfer relationships and information on inventions in development. The Transition Agreement is filed as Exhibit 10.1 (redacted in part).

Key Details

• Transition period: March 31, 2026 – June 30, 2026; Mr. Conboy will not participate in internal management during this time.
• Cash and in‑kind consideration: $10,000 per month during the 90‑day Transition Period; reimbursement of pre‑approved expenses; company to advance up to $200,000 worth of specified products.
• Post‑transition commercial rights: Mr. Conboy has an exclusive right to sell specified products/systems within a defined carve‑out around North Lake Tahoe, South Lake Tahoe and Truckee, CA, subject to minimum gross sales targets of $500,000 in 2026 and $2,000,000 in 2027 and thereafter and the company’s audit rights.
• Purchasing and equity provisions: post‑transition preferred purchase pricing for specified products; if the company raises ≥ $10,000,000 in outside financing it may elect to purchase or register for resale up to $1,000,000 of Conboy’s existing common stock; starting December 1 of the year CitroTech exceeds $10,000,000 in gross revenue and annually thereafter until a $7,500,000 royalty is satisfied, the company will deliver $1,500,000 in restricted common shares (subject to offsets and ownership limits).
• Additional terms: parties will negotiate a possible post‑transition affiliate commission agreement; agreement includes release of claims by Conboy, confidentiality, non‑disclosure, restrictive covenants, non‑disparagement, suspension/cessation of compensation on breach, and specified remedies including liquidated damages.

Why It Matters

• Management change: the company lost its CTO role but retained Conboy as an advisor during a 90‑day handover, which may limit near‑term disruption to product and IP transitions.
• Financial and dilution considerations: near‑term cash cost is modest ($10,000/month for three months plus up to $200,000 in product advances), but the agreement contains potential future equity issuances and resale/purchase mechanics that could affect shareholder dilution depending on revenue triggers and future financing.
• Commercial impact: the exclusive local sales carve‑out and minimum sales thresholds create contingent revenue and audit obligations and may affect how certain products are sold in the Tahoe/Truckee area.
  Investors should review the filed Transition Agreement (Exhibit 10.1) for full terms and monitor future disclosures about related financing, revenue milestones, or affiliate agreements.