EXHIBIT 10.36

EVERSPIN TECHNOLOGIES, INC.

EXECUTIVE CHANGE IN CONTROL PLAN

ADOPTED: March 2020

 

 

 

 

 

 

 

Executive Group

 

Executive CIC Benefits in connection with a Change in Control

 

 

CEO and Vice
President of
Technology R&D

 

  12 months base salary

  Full performance-based bonus at target

  12 months COBRA benefits continuation

  12 month double trigger vesting acceleration

 

 

All other Vice
Presidents

 

  6 months base salary

  Full performance-based bonus at target

  6 months COBRA benefits continuation

  6 month double trigger vesting acceleration

 

 

 

Definitions

“Board” shall mean the board of directors of the Company.

“Cause” shall mean your termination for any one or more of the following
reasons:

·

your indictment or conviction of any felony or any crime involving dishonesty or
moral turpitude under the laws of the United States or any state thereof;

·

your refusal to abide by or comply with any reasonable, lawful directives of the
Chief Executive Officer or the Board;

·

your willful dishonesty, fraud, or material misconduct with respect to the
business or affairs of the Company; 

·

your intentional, material violation of any contract or agreement with the
Company or of any statutory duty owed to the Company; or

·

conduct by which you demonstrate gross unfitness to serve.

“Change in Control” shall mean (a) any Exchange Act Person becomes the Owner of
securities of the company representing more than 50% of the combined voting
power of the then outstanding securities other than by virtue of a merger,
consolidation or similar transaction, (b) a consolidation or merger of the
Company with or into any other corporation or other entity or person, or any
corporate reorganization in which the stockholders of the Company immediately
prior to such consolidation, merger or reorganization, own less than 50% of the
voting power of the

 

surviving entity immediately after such consolidation, merger or reorganization,
provided, however, that the outstanding voting securities representing more than
50% of the combined voting power of the surviving Entity or its parent are not
owned by the IPO entities, (c) a sale or other disposition of all or
substantially all of the assets of the Company, or (d) a complete dissolution or
liquidation of the Company, except for a liquidation into a parent corporation.
A Change in Control shall not include a sale of assets, merger or other
transaction effected exclusively for the purpose of changing the domicile of the
Company and the definition of Change in Control in an individual written
agreement.

“Company” shall mean Everspin Technologies, Inc., or any acquirer or successor
in interest thereof.

“Double Trigger” shall be achieved if your employment is terminated by the
Company without Cause or by you for Good Reason at any time during the period
commencing three months prior to a Change in Control and ending 12 months—or in
the case of the CEO, 18 months—following the Change in Control.

“Equity Awards” shall mean any equity awards, including but not limited to
options, restricted stock and restricted stock units.

“Vesting Acceleration” shall mean the vesting of the Shares subject to any
Equity Awards held by you on the date of your termination shall be accelerated
such that the then unvested Equity Awards shall vest and become exercisable as
to the number of shares subject to such equity award that would have vested if
(i) in the case of the CEO and VP of Technology R&D, such executive had
completed an additional 12 months of employment following the termination date
or (ii) in the case of all other Participants, such Participant had completed an
additional 6 months of employment following the termination date.

“Good Reason” shall mean if one of the following events occurs without your
written consent: (i) a material reduction in the amount of aggregate cash
compensation which you have the opportunity to earn, or failure by the company
to pay such compensation; (ii) you are required by the Company to relocate your
Primary Work Location (as set forth on EXHIBIT A) by more than 50 miles; (iii) a
material adverse reduction in your duties, authority or responsibilities, but
excluding any change to your reporting responsibilities or any change in title
that does not represent a material adverse reduction in your duties, authority
or responsibilities as existed immediately prior to such change in title and
(iv) a material breach by the Company under this agreement or any written
agreement between the executive and the company.

For purposes of clause (iii) above, if the Company is operated as a separate
subsidiary or business unit following a Change in Control, such officers will be
deemed to have suffered a material reduction in duties, authority or
responsibilities if such duties, authority or responsibilities—excluding
reporting responsibilities—with respect to such subsidiary or separate business
unit are materially changed following such Change in Control. For example, if
you were the CFO of the Company, and then the CFO of a subsidiary after the
Change in Control such that the only change to your responsibilities were that
you no longer had reporting responsibilities, that would not fit within the
definition of Good Reason.

In order to effect a Resignation for Good Reason, you must notify the Board
within 30 days after the first occurrence of the event described above, the
Company must fail to cure such event within 30 days after receiving written
notice, and your resignation date must be no later than 60 days after the
expiration of the Company’s cure period.

“Participant” means each individual who (i) is employed by the Company as a Vice
President or above and (ii) has received and returned a signed Participation
Notice attached hereto as EXHIBIT A.

“Separation from Service” shall mean any termination of employment is terminated
by the Company without Cause or resignation for Good Reason, whether or not a
Change in Control has occurred, and such termination constitutes a “separation
from service” (as defined under Treasury Regulation Section 1.409A-1(h)).

 

“Severance Benefits” shall mean the acceleration of vesting, continuation of
benefits, bonus payments and base salary payments described above and below.

General

As a condition of your receipt of any Severance Benefits or Vesting Acceleration
as set forth in this Agreement, you will be required to execute and allow to
become effective a general release of claims in favor of the Company, with such
changes as may be required due to intervening changes in applicable law (a
“General Release”) within 45 days following your employment termination. Unless
the Release is timely signed by you, is delivered to the Company, and becomes
effective within the required period (the date on which the Release becomes
effective, the “Release Date”), you will not be entitled to any Severance
Benefits pursuant to this Agreement, and any Vesting Acceleration as provided in
this Agreement shall not apply and each Equity Awards may be exercised following
the date of your termination only to the extent provided under its original
terms.

The Salary Continuation will be paid in equal installments on the Company’s
regular payroll schedule and will be subject to applicable tax withholdings over
the 6- or 12-month period, as applicable, outlined above following the date of
your Separation from Service; provided, however, that no payments will be made
prior to the first payroll date following the effective date of the General
Release (the “Initial Payment Date”). On the Initial Payment Date, the Company
will pay you in a lump sum the Salary Continuation that you would have received
on or prior to such date under the original schedule but for the delay while
waiting for Initial Payment Date in compliance with Section 409A and the
effectiveness of the General Release, with the balance of the Salary
Continuation being paid as originally scheduled. Notwithstanding the foregoing,
the Company may pay the Salary Continuation in the form of a lump sum, which
amount will be paid on the Initial Payment Date, but such lump sum payment shall
be made only if the Company, in consultation with its advisors, determines that
such payment will not result in adverse taxation under Section 409A (as defined
below). The Pro Rata Bonus will be paid to you in a lump sum on the date on
which the Salary Continuation commences.

Section 409A

Notwithstanding any provision to the contrary in this Agreement, if you are
deemed by the Company at the time of your Separation from Service to be a
“specified employee” for purposes of Section 409A of the Internal Revenue Code
of 1986, as amended, and the regulations and guidance promulgated thereunder
(“Section 409A”) then to the extent delayed commencement of any portion of the
severance benefits to which you are entitled under this Agreement is required in
order to avoid adverse taxation under Section 409A, such portion of your
benefits shall not be provided to you prior to the earlier of (i) the expiration
of the six-month period measured from the date of your Separation from Service
with the Company or (ii) the date of your death. Upon the first business day
after such earlier date, all payments deferred pursuant to this paragraph shall
be paid in a lump sum to you, and any remaining payments due under this
Agreement shall be paid as otherwise provided herein. For purposes Section 409A
(including, without limitation, for purposes of Treasury Regulation Section
1.409A-2(b)(2)(iii)), your right to receive installment payments under this
Agreement shall be treated as a right to receive a series of separate payments
and, accordingly, each installment payment hereunder shall at all times be
considered a separate and distinct payment. Notwithstanding any other provision
of this Agreement, with respect to payments to be made upon execution of an
effective release, if the release revocation period spans two calendar years,
payments will be made in the second of the two calendar years to the extent
necessary to avoid adverse taxation under Section 409A.

Section 280G

Notwithstanding anything in the foregoing to the contrary, if any of the
payments to you (prior to any reduction described in this paragraph) provided
for in this Agreement, together with any other payments which you have the right
to receive from the Company, any acquiror, their affiliates or otherwise (the
“Payments”) would constitute a

 

“parachute payment” (as defined in Section 280G(b)(2) of the Internal Revenue
Code of 1986, as amended (the “Code”)) and if the Safe Harbor Amount, as defined
below, is greater than the Taxed Amount, as defined below, then the total amount
of such Payments shall be reduced to the Safe Harbor Amount. The “Safe Harbor
Amount” is the largest portion of the Payments that would result in no portion
of the Payments being subject to the excise tax set forth at Section 4999 of the
Code (“Excise Tax”). The “Taxed Amount” is the total amount of the Payments
(prior to any reduction as described in this paragraph) notwithstanding that all
or some portion of the Payments may be subject to the Excise Tax. Solely for the
purpose of comparing which of the Safe Harbor Amount and the Taxed Amount is
greater, the determination of each such amount, shall be made on an after-tax
basis, taking into account all applicable federal, state and local employment
taxes, income taxes, and the Excise Tax. If a reduction of the Payments to the
Safe Harbor Amount is necessary, then the reduction shall occur in the following
order: reduction of cash payments; cancellation of accelerated vesting of stock
awards; and reduction of employee benefits. In the event that acceleration of
vesting of a stock award is to be reduced, such acceleration of vesting shall be
cancelled in the reverse order of the date of grant of your stock awards.  In
applying the foregoing principle with respect to reductions, the reduction shall
be made in a manner consistent with the requirements of Section 409A of the Code
and the regulations promulgated thereunder, and if more than one method of
reduction will result in the same economic benefit, the items so reduced will be
reduced pro rata.  The accounting firm engaged by the Company for general audit
purposes as of the day prior to the effective date of the Change in Control
transaction shall perform the foregoing calculations. If the accounting firm so
engaged by the Company is serving as accountant or auditor for the individual,
entity or group effecting the Change in Control, or the Company otherwise
determines such accounting firm should not be engaged for purposes of making the
determinations required hereunder, the Company may appoint a nationally
recognized accounting firm to make the determinations required hereunder. The
Company shall bear all expenses with respect to the determinations by such
accounting firm required to be made hereunder. The accounting firm engaged to
make the determinations hereunder shall provide its calculations, together with
detailed supporting documentation, to the Company and you within 15 calendar
days after the date on which your right to a Payment is triggered (if requested
at that time by the Company or you) or such other time as requested by the
Company or you upon written notice that a payment related to a Change in Control
of the Company has been or is to be made.

For the avoidance of doubt, in connection with a Change in Control, if there is
a conflict in terms between this Executive Change in Control Plan and your
existing employment agreement, then the terms of this Executive Change in
Control Plan shall govern.

 

EXHIBIT A

PARTICIPATION NOTICE

EVERSPIN TECHNOLOGIES, INC.

EXECUTIVE SEVERANCE AND CHANGE IN CONTROL PLAN

To:

Date:

Everspin Technologies, Inc. (the “Company”) has adopted the Everspin
Technologies, Inc. Executive Severance and Change in Control Plan (the “Plan”).
The Company is providing you this Participation Notice to inform you that you
have been designated as a Participant in the Plan, and you shall be entitled to
the benefits set forth in the Plan in connection with your termination without
Cause upon a Change in Control or your resignation with Good Reason upon a
Change in Control. A copy of the Plan document is attached to this Participation
Notice. The terms and conditions of your participation in the Plan are as set
forth in the Plan and this Participation Notice, which together constitute the
Summary Plan Description for the Plan.

By accepting participation, you represent that you have either consulted your
personal tax or financial planning advisor about the tax consequences of your
participation in the Plan, or you have knowingly declined to do so.

Please return a signed copy of this Participation Notice to the Company’s
[         TITLE           ] and retain a copy of this Participation Notice,
along with the Plan document, for your records.

 

 

EVERSPIN TECHNOLOGIES, INC.:

 

 

(Signature)

 

 

 

 

 

 

By:

  [        NAME                                         ]

 

 

 

  [                    TITLE                         ]

 

 

PARTICIPANT:

 

 

 

 

 

 

(Signature)

 

 

By:

 

 

 

Primary Work Location: