Item
5.02 Departure
of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
Effective
as of October 23, 2020, Hyliion Holdings Corp. (the “Company”) entered into an employment agreement with Greg Van
de Vere, its Chief Financial Officer, which provides for an initial one-year term, and automatically renews for successive 12-month
terms thereafter unless at least ninety 90 days prior to the expiration of any 12-month term either party notifies the other of
non-renewal. Pursuant to the agreement, Mr. Van de Vere will receive an annual base salary of $400,000 and is eligible for discretionary
cash bonuses, at the discretion of the Company’s board of directors (the “Board”).
In
addition, pursuant to the terms of his employment agreement, and subject to the approval of the compensation committee of the
Board (the “Compensation Committee”), Mr. Van de Vere will be granted (on a one-time basis) (i) a time-based restricted
stock unit (“RSU”) award covering 100,000 shares of the Company’s common stock, which will vest over a four-year
period, with 25% vesting on October 1, 2021, and the remainder vesting in 12 equal quarterly installments thereafter, subject
to Mr. Van de Vere’s continuous service through each applicable vesting date, and (ii) a performance-based RSU award covering
500,000 shares of the Company’s common stock, which will vest over the period from October 23, 2020 through December 31,
2025 based upon the achievement of pre-defined performance criteria determined by the Compensation Committee, subject to Mr. Van
de Vere’s continuous service to through each applicable vesting date.
Under
Mr. Van de Vere’s employment agreement, if Mr. Van de Vere’s employment is terminated (i) due to non-renewal of the
term of his employment agreement, (ii) by the Company without “cause”, or (iii) by Mr. Van de Vere for “good
reason” (such terms are defined therein), then, subject to execution of claims release and compliance with the confidentiality,
non-competition, non-solicitation, and intellectual property provisions set forth in his employment agreement, he will receive
the following severance benefits: (a) 12 months current annual base salary; (b) accelerated vesting and, if applicable, exercisability
of the then-unvested portion of each of his outstanding equity awards (other than any equity awards subject to performance-based
or other similar vesting criteria) that would have vested had he remained employed for an additional 12 months following termination;
(c) each of his then-outstanding and unexercised stock options (to the extent vested) will remain exercisable for up to 36 months
following the termination date; and (d) up to 12 months of reimbursement for COBRA coverage.
In
addition, Mr. Van de Vere’s employment agreement provides that if Mr. Van de Vere’s employment with us is terminated
due to his death or “disability” (as defined therein), all of his then-outstanding and unvested equity awards (other
than any equity awards subject to performance-based or other similar vesting criteria) will immediately vest in full and, if applicable,
become fully exercisable.
Mr.
Van de Vere’s employment agreement also provides that in the event of a change in control (as defined in the Company’s
2020 Equity Incentive Plan), and provided Mr. Van de Vere remains in continuous service through immediately prior to such change
in control, the performance-based RSU award provided therein will vest immediately prior to such change in control based upon
the actual achievement of the applicable performance vesting criteria to which such award is subject, whereas if the time-based
RSU provided therein is not assumed, substituted for, or continued by the successor corporation (or a parent or subsidiary thereof),
such award will fully vest and settle immediately prior to consummation of such change in control, subject to Mr. Van de Vere’s
continued service through immediately prior to such change in control.
For
clarity, on October 16, 2020, all of Mr. Van de Vere’s unvested Company options that were granted to him prior to October
1, 2020 fully accelerated vesting and exercisability in accordance with the terms of his prior employment agreement with Hyliion
Inc.
The
foregoing description of Mr. Van de Vere’ employment agreement is qualified in its entirety by the full text thereof the
employment agreement , a copy of which is filed as Exhibit 10.1 hereto and incorporated herein by reference.