Document:

Exhibit
10.18

 

EMPLOYMENT
AGREEMENT

 

This
Employment Agreement (“Agreement”) is made and entered into by and between Hyliion Holdings Corp., a
Delaware corporation, (the “Company”), and Sherri Baker (“Employee”), and
shall be effective as of the Effective Date, as defined below. This Agreement is intended to terminate and supersede any employment
agreement, offer letter or other employment-related agreement by and between Employee and the Company, any Company subsidiary
or predecessor entity.

 

RECITALS

 

WHEREAS,
the Company and Employee desire to enter into this Agreement on the terms and subject to the conditions set forth herein,
effective as of February 1, 2021 (the “Effective Date”).

 

NOW,
THEREFORE, in consideration of the above recitals incorporated herein and the mutual covenants and premises contained herein
and other good and valuable consideration, the receipt and sufficiency of which are hereby expressly acknowledged, the parties
agree as follows:

 

1.
Employment. During the Employment Period (as defined in Section 4), the Company shall employ Employee, and
Employee shall serve, as Chief Financial Officer of the Company and in such other position or positions as may be assigned from
time to time by the Chief Executive Officer (“CEO”) of the Company or as otherwise designated by the
board of directors of the Company (the “Board”).

 

2.
Duties and Responsibilities of Employee.

 

(a)
Employee shall, during the Employment Period, devote Employee’s best efforts and full business time and attention to the
businesses of the Company and its direct and indirect subsidiaries as may exist from time to time (collectively, the Company and
its current and future wholly owned direct and indirect subsidiaries are referred to as the “Company Group”)
as may be requested by the CEO from time to time.  Employee’s duties and responsibilities shall include those normally
incidental to the position(s) identified in Section 1, as well as such additional duties as may be assigned to Employee
by the CEO from time to time, which duties and responsibilities may include providing services to other members of the Company
Group in addition to the Company. Employee shall report to the CEO. Employee may, without violating this Section 2(a),
(i) as a passive investment, own publicly-traded securities in such form or manner as will not require any services by Employee
in the operation of the entities in which such securities are owned; or (ii) engage in outside activities provided (x) such ownership
interests or activities (including but not limited to membership on boards of directors of for-profit organizations), so long
as such ownership interests or activities do not interfere with Employee’s ability to fulfill Employee’s duties and
responsibilities under this Agreement and are not inconsistent with Employee’s obligations to any member of the Company
Group or competitive with the business of any member of the Company Group; and (y) Employee gives written notice to the CEO of
any significant outside business activity in which Employee plans to become involved, if such activity is pursued for profit.
Notwithstanding the foregoing, Employee will not serve as a member on any Board of Directors (or similar body) of any for-profit
organization without first obtaining the express written approval of the CEO. Employee has listed, in Exhibit A attached hereto,
a complete list of all such entities and/or organizations that may be implicated by this Section 2, which shall be deemed approved
by the CEO.

 

     

     

    

 

(b)
Employee hereby represents and warrants that Employee is not the subject of, or a party to, any non-competition, non-solicitation,
restrictive covenant or non-disclosure agreement, or any other agreement, obligation, restriction or understanding that would
prohibit Employee from executing this Agreement or fully performing each of Employee’s duties and responsibilities hereunder,
or would in any manner, directly or indirectly, limit or affect any of the duties and responsibilities assigned to Employee hereunder.
Employee expressly acknowledges and agrees that Employee is strictly prohibited from using or disclosing any confidential information
belonging to any prior employer or third party in the course of performing services for any member of the Company Group, and Employee
promises that Employee shall not do so. Employee shall not introduce documents or other materials containing confidential information
of any prior employer and/or other third party to the premises or property (including computers and computer systems) of any member
of the Company Group.

 

(c)
Employee owes each member of the Company Group fiduciary duties (including (i) duties of loyalty and disclosure and (ii) such
fiduciary duties that an officer of the Company would have if the Company were a corporation organized under the laws of the State
of Delaware), and the obligations described in this Agreement are in addition to, and not in lieu of, the obligations Employee
owes each member of the Company Group under statutory and common law.

 

3.
Compensation.

 

(a)
Base Salary. During the Employment Period, the Company shall pay to Employee an annualized base salary of $425,000 (the
“Base Salary”) in consideration for Employee’s services under this Agreement, payable in substantially
equal installments in conformity with the Company’s customary payroll practices for similarly situated employees as may
exist from time to time, but no less frequently than monthly. Employee’s Base Salary will be reviewed annually by the CEO
based on the performance of the Employee and the Company. The CEO may, but will not be required to, increase the Base Salary during
the Initial and any Renewal Term.

 

(b)
Target Bonus; Sign-On Bonus.

 

(i)
In addition to the Base Salary, during the Employment Period, Employee will be entitled to participate in an annual incentive
compensation plan of the Company. Employee’s target annual bonus will be equal to 75% of Employee’s Base Salary as
in effect for such year (the “Target Bonus”) based upon achievement of performance goals established
by the Compensation Committee of the Board pursuant to such plan. The Target Bonus will be paid at the time and in the manner
specified under the annual incentive compensation plan of the Company.

 

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(ii)
The Company will pay you a one-time cash bonus (the “Sign-On Bonus”) in the amount of $350,000 to be paid on the first
payroll following your start date. If, within 1 year of hire date, Employee is terminated for Cause (as defined hereinbelow) or
Employee chooses to leave the employment of the Company, Employee (or Employee’s representative) agrees to return the Sign-On
Bonus on the date of Employee’s termination or departure.

 

(c)
Equity Awards.

 

(i)
Subject to the approval of the Compensation Committee of the Board (the “Compensation Committee”), Employee will be
granted a one-time stock award (a “Special Vested Award”).  The Special Vested Award will cover
such number of shares of the Company’s common stock valued at $250,000 as of the grant date, disregarding any fractional
share amounts. The Special Vested Award will be immediately 100% vested upon grant.  If, within 1 year of hire date, Employee
is terminated for Cause (as defined hereinbelow) or Employee chooses to leave the employment of the Company, Employee (or Employee’s
representative) agrees to return either the shares of common stock underlying this Special Vested Award (for no consideration
from the Company or its affiliates) or the cash value of such shares as of the date of the Employee’s termination or departure. 
Employee acknowledges and agrees that Employee is bound by the lock-up policy preventing employees of the Company from selling
common stock of the Company until April 1, 2021, as well as the Company’s insider trading policy. 

 

(ii)
Subject to the approval of the Compensation Committee, Employee will be granted annual time-vested restricted stock unit awards
(each, a “Time-Vested Award”) and a one-time performance-based restricted stock unit award (a “Performance
Award”) as soon as administratively practicable following the effective registration of the securities reserved
for issuance under the Company’s 2020 Equity Incentive Plan (the “2020 Plan”) on a Form S-8 registration
statement pursuant to the Securities Act of 1933, as amended (the “Form S-8”). Notwithstanding anything
to the contrary in this Agreement, the Time-Vested Award and the Performance Award will not be deemed granted unless and until
(i) the Form S-8 has become effective and (ii) the vesting schedule and all other material terms of such equity awards have been
approved by the Compensation Committee. Employee acknowledges and agrees that the actual grant dates for future Time-Vested Awards
shall be determined by the Compensation Committee and may be coordinated with the annual grant dates for Time-Vested Awards granted
to other employees.

 

(ii)
Each annual Time-Vested Award will cover such number of shares of the Company’s common stock valued at $600,000 as of the
applicable grant date, disregarding any fractional share amounts; provided, that for purposes of determining the number of shares
to be issued in connection with each annual grant, the Company’s common stock shall in no event be valued below $10 per
share, and the Board or Compensation Committee may reduce the amount of any annual Time-Vested Award in connection with a general
reduction in Time-Vested Awards that affects all similarly situated executives of the Company in substantially the same proportions.
Each Time-Vested Award will vest over a three-year period, with 33.33% of the Time-Vested Award vesting on the one-year anniversary
of the first Quarterly Vesting Date following the applicable grant date and approximately 8.33% of the Time-Vested Award vesting
on each Quarterly Vesting Date thereafter, subject to Employee remaining in Continuous Service (as defined in the 2020 plan) through
such Quarterly Vesting Date. For purposes of this agreement, “Quarterly Vesting Dates” with respect
to any calendar year means February 15, May 15, August 15, or November 15, as applicable, provided, to the extent any of such
dates occurs on a weekend day or U.S. federal holiday, the Quarterly Vesting Date will be deemed to occur instead on the immediately
following day that is not a weekend day or federal holiday. 

 

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(iii)
The Performance Award will cover 200,000 shares of the Company’s common stock. The Performance Award will vest based upon
the achievement of objective performance criteria, as determined by the Compensation Committee in its sole and absolute discretion
prior to the date of grant of the Performance Award, during the period from the Effective Date through December 31, 2024, subject
to Employee remaining in Continuous Service through each applicable vesting date.

 

(iv)
In the event of a Change in Control (as defined in the 2020 Plan), unless determined otherwise by the Board or the Compensation
Committee, with the consent of Employee, prior to such Change in Control, and provided Employee remains in Continuous Service
through immediately prior to such Change in Control, the Performance Award will vest immediately prior to the Change in Control
based upon the actual achievement of the applicable performance vesting criteria to which the Performance Award is subject (measured
as of immediately prior to the Change in Control), taking into account performance through the latest date preceding the Change
in Control as to which performance can, as a practical matter, be determined (but not later than the end of the applicable performance
period). For clarity, any portion of the Performance Award that has not vested as of immediately prior to a Change in Control
(after taking into account the vesting treatment contemplated in the immediately preceding sentence) will be forfeited without
cost to the Company, unless otherwise determined by the Board or the Compensation Committee prior to such Change in Control. In
addition, if the Time-Vested Award is not assumed, substituted for or otherwise continued by the successor corporation (or a parent
or subsidiary thereof) in the event of a Change in Control, or if this Agreement is not assumed or replaced with a substantially
similar (or more beneficial) employment agreement (excluding performance-based equity awards) by the successor corporation (or
a parent or subsidiary thereof) in the event of a Change in Control, the Time-Vested Award will fully vest and will be settled
immediately prior to the consummation of such Change in Control, subject to Employee remaining in Continuous Service through immediately
prior to such Change in Control.

 

(v)
Each of the Time-Vested Award and the Performance Award will be granted under and subject to the terms and conditions of the 2020
Plan and an appropriate form of award agreement approved by the Board or the Compensation Committee for use thereunder. The terms
of this Agreement shall be reflected in such award agreement, and in the event of any conflict between the terms of such award
agreement and this Agreement, the terms of such award agreement shall govern and control only if it has been executed by Employee.

 

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4.
Term of Employment. The initial term of Employee’s employment under this Agreement shall be for the period
beginning on the Effective Date and ending on the third (3rd) anniversary of the Effective Date (the “Initial Term”).
On the third (3rd) anniversary of the Effective Date and on each subsequent anniversary thereafter, the term of Employee’s
employment under this Agreement shall automatically renew and extend for a period of twelve (12) months (each such twelve (12)-month
period being a “Renewal Term”) unless written notice of non-renewal is delivered by either party to
the other not less than one hundred eighty (180) days prior to the expiration of the then-existing Initial Term or Renewal Term,
as applicable. Notwithstanding any other provision of this Agreement, Employee’s employment pursuant to this Agreement may
be terminated at any time in accordance with Section 7. The period from the Effective Date through the expiration of this
Agreement or, if sooner, the termination of Employee’s employment pursuant to this Agreement, regardless of the time or
reason for such termination, shall be referred to herein as the “Employment Period.”

 

5.
Business Expenses. Subject to Section 22, the Company shall reimburse Employee for Employee’s reasonable
out-of-pocket business-related expenses actually incurred in the performance of Employee’s duties under this Agreement so
long as Employee timely submits all documentation for such expenses, as required by Company policy in effect from time to time.
Any such reimbursement of expenses shall be made by the Company in accordance with the Company’s expense reimbursement policy
as in effect from time to time following the receipt of such documentation. In no event shall any reimbursement be made to Employee
for any expenses incurred after the date of Employee’s termination of employment with the Company.

 

6.
Benefits. During the Employment Period, Employee shall be eligible to participate in the same benefit plans and
programs in which other similarly situated Company employees are eligible to participate, subject to the terms and conditions
of the applicable plans and programs in effect from time to time. The Company shall not, however, by reason of this Section
6, be obligated to institute, maintain, or refrain from changing, amending, or discontinuing, any such plan or policy, so
long as such changes are similarly applicable to similarly situated Company employees generally.

 

7.
Termination of Employment.

 

(a)
Company’s Right to Terminate Employee’s Employment for Cause. The Company shall have the right to terminate
Employee’s employment hereunder at any time for Cause. For purposes of this Agreement, “Cause”
shall mean:

 

(i)
Employee’s material breach of this Agreement (including, but not limited to his/her willful failure or refusal to follow
any lawful directive of the Board) or any other written agreement between Employee and one or more members of the Company Group;

 

(ii)
Employee is convicted of, or pleads guilty or nolo contendere to, any felony, or any misdemeanor involving moral turpitude,
in either case other than related to a motor vehicle violation;

 

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(iii)
Employee’s intentional or grossly negligent act of fraud or dishonesty against the Company or a member of the Company Group,
which causes or can reasonably be expected to cause material loss, damage or injury to the property or reputation of the Company
or a Company Group member; or

 

(iv)
Employee’s breach of any written policy or code of conduct established by a member of the Company Group and applicable to
Employee, which causes or can reasonably be expected to cause material loss, damage or injury to the property or reputation of
the Company or a Company Group member.

 

Notwithstanding
the foregoing, it shall be a condition precedent to the Company’s right to terminate Employee’s employment for Cause
under Section 7(a)(i), (iii), (iv), or (v) that the Company: (x) first have given Employee written notice stating with specificity
the reason for the termination (“Breach”), and (y) if such Breach is susceptible of cure or remedy,
a period of thirty (30) days from and after the giving of such notice shall have elapsed without Employee’s having effectively
cured or remedied such Breach during such thirty (30)-day period, unless such Breach cannot be cured or remedied within thirty
(30) days, in which case the period for remedy or cure shall be extended for a reasonable time (not to exceed an additional thirty
(30) days) provided that the Employee has made and continues to make a diligent effort to effect such remedy or cure within the
initial thirty (30) day period and any such extension.

 

(b)
Company’s Right to Terminate for Convenience. The Company shall have the right to terminate Employee’s employment
for convenience at any time and for any reason, or no reason at all, upon written notice to Employee.

 

(c)
Employee’s Right to Terminate for Good Reason. Employee shall have the right to terminate Employee’s employment
with the Company at any time for Good Reason. For purposes of this Agreement, “Good Reason” shall mean:
a resignation by Employee as a result of:

 

(i)
a material diminution in Employee’s Base Salary, other than a general reduction in Base Salary that affects all similarly
situated executives of the Company in substantially the same proportions;

 

(ii)
an adverse change in title, authorities or responsibilities that materially diminishes Employee’s position;

 

(iii)
a material change in the Employee’s reporting relationship such that Employee no longer reports directly to an “executive
officer”, as defined in 17 CFR § 240.3b-7, of any member of the Company Group; or

 

(iv)
a breach by any member of the Company Group of any of its obligations under this Agreement or any other written agreement between
such member of the Company Group and Employee, which causes or can reasonably be expected to cause material loss, damage or injury
to the property or reputation of Employee.

 

A
resignation for Good Reason will not be deemed to have occurred unless Employee gives the Company written notice of the condition
within sixty (60) days after the condition comes into existence, the Company fails to remedy the condition within thirty (30)
days after receiving Employee’s written notice, and the date of Employee’s termination of employment must occur no
later than ninety (90) days after the initial occurrence of the condition(s) specified in such notice.

 

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(d)
Death. Upon the death of Employee, Employee’s employment with the Company and/or all members of the Company Group
shall automatically (and without any further action by any person or entity) terminate with no further obligation under this Agreement
of either Party, except as expressly provided within this paragraph. Upon the Employee’s separation from service (within
the meaning of Section 409A (as defined below)) due to death all unvested Company equity compensation awards (other than any Company
equity compensation awards that are subject to performance-based or other similar vesting criteria) granted under any equity compensation
plan of the Company that are held by Employee as of the date immediately prior to the applicable Termination Date (defined below)
shall immediately vest in full and such awards, to the extent applicable, shall immediately become exercisable and be eligible
for settlement in accordance with the terms and conditions provided in the applicable award agreements governing such awards.

 

(e)
Employee’s Right to Terminate for Convenience. In addition to Employee’s right to terminate Employee’s
employment for Good Reason, Employee shall have the right to terminate Employee’s employment with the Company for convenience
at any time and for any other reason, or no reason at all, upon thirty (30) days’ advance written notice to the Company;
provided, however, that if Employee has provided notice to the Company of Employee’s termination of employment,
the Company may determine, in its sole discretion, that such termination shall be effective on any date prior to the effective
date of termination provided in such notice (and, if such earlier date is so required, then it shall not change the basis for
Employee’s termination of employment nor be construed or interpreted as a termination of employment pursuant to Section
7(b)).

 

(f)
Effect of Termination.

 

(i)
Subject to Section 7(f)(iv), if Employee’s employment hereunder is terminated by the Company via expiration and/or non-renewal
of the Agreement pursuant to Section 4, without Cause pursuant to Section 7(b), or is terminated by Employee for
Good Reason pursuant to Section 7(c), then so long as (and only if) Employee: (1) executes on or before the Release Expiration
Date (as defined below), and does not revoke within any time provided by the Company to do so, a release of all claims in a form
acceptable to the Company (the “Release”) (in the form attached hereto as Exhibit B, as updated if necessary,
pursuant to applicable law), which Release shall release each member of the Company Group and their respective affiliates, and
the foregoing entities’ respective shareholders, members, partners, officers, managers, directors, fiduciaries, employees,
representatives, agents and benefit plans (and fiduciaries of such plans) from any and all claims, including any and all causes
of action arising out of Employee’s employment with the Company and any other member of the Company Group or the termination
of such employment, but excluding all claims to Termination Benefits (as defined below) Employee may have under this Section
7; and (2) abides by the terms of each of Sections 9, 10 and 11, then (a) the Company shall make a severance
payment to Employee in an amount equal to the sum of twelve (12) months’ worth of Employee’s then current Base Salary
(“Severance Payment”), (b) cause each of Employee’s then-outstanding and unvested stock options,
restricted stock awards, restricted stock unit awards and any other Company equity compensation awards (other than (1) any Company
equity compensation awards that are subject to performance-based or other similar vesting criteria, and (2) any stock options
or any other equity awards that were granted to Employee under the 2016 Plan) that was granted to Employee more than one year
prior to the date of Employee’s termination of employment to vest in full and, to the extent applicable, become fully exercisable
(“Vesting Acceleration”), and (c) cause each of Employee’s then-outstanding and unexercised stock
options (to the extent vested as of Employee’s Termination Date) to remain exercisable until the earlier of (i) the date
that is three years following Employee’s Termination Date, (ii) the expiration date of the stock option, and (iii) in the
event of a “Change in Control” (as defined in the 2020 Plan or the 2016 Plan), or any similar transaction, in which
the successor corporation (or a parent or subsidiary thereof) does not assume or substitute for the stock option, immediately
prior to the effective time of such transaction (“Post-Termination Exercise Period Extension”).

 

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(ii)
If Employee’s employment hereunder is terminated in circumstances in which Employee is eligible to receive a Severance Payment
under Section 7(f)(i) and Employee satisfies each of the conditions to receive a Severance Payment under Section 7(f)(i),
then, if Employee elects to continue coverage for Employee and Employee’s spouse and eligible dependents, if any, under
the Company’s group health plans pursuant to Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”),
the Company shall promptly reimburse Employee on a monthly basis for the difference between the amount Employee pays to effect
and continue such coverage and the employee contribution amount that similarly situated employees of the Company pay for the same
or similar coverage under such group health plans (the “COBRA Subsidy” and together with the Severance
Payment, the Vesting Acceleration, and the Post-Termination Exercise Period Extension, the “Termination Benefits”).
Each payment of the COBRA Subsidy shall be paid to Employee on the Company’s first regularly scheduled pay date in the calendar
month immediately following the calendar month in which Employee submits to the Company documentation of the applicable premium
payment having been paid by Employee, which documentation shall be submitted by Employee to the Company within thirty (30) days
following the date on which the applicable premium payment is paid. Employee shall be eligible to receive such reimbursement payments
until the earliest of: (1) the date that is twelve (12) months following the Termination Date (the “COBRA Expiration
Date”); (2) the date Employee is no longer eligible to receive COBRA continuation coverage; and (3) the date on
which Employee becomes eligible to receive coverage under a group health plan sponsored by another employer (and any such eligibility
shall be promptly reported to the Company by Employee); provided, however, that the election of COBRA continuation coverage and
the payment of any premiums due with respect to such COBRA continuation coverage shall remain Employee’s sole responsibility,
and the Company shall not assume any obligation for payment of any such premiums relating to such COBRA continuation coverage.
Notwithstanding the foregoing, if the provision of the benefits described in this Section 7(f)(ii) cannot be provided in the manner
described above without penalty, tax or other adverse impact on the Company or any other member of the Company Group, then the
Company and Employee shall negotiate in good faith to determine an alternative manner in which the Company may provide substantially
equivalent benefits to Employee without such adverse impact on the Company or such other member of the Company Group.

 

(iii)
Subject to Section 7(f)(v) below, the Severance Payment will be divided into substantially equal installments over the twelve
(12)-month period following the date of Employee’s applicable separation from service (the “Termination Date”).
On the Company’s first regularly scheduled pay date that is on or after the date that is sixty (60) days after the Termination
Date (the “First Payment Date”), the Company shall pay to Employee, without interest, a number of such
installments equal to the number of such installments that would have been paid during the period beginning on the Termination
Date and ending on the First Payment Date had the installments been paid on the Company’s regularly scheduled pay dates
on or following the Termination Date, and each of the remaining installments shall be paid on the Company’s regularly scheduled
pay dates during the remainder of applicable payment period; provided, however, that (1) to the extent, if any,
that the aggregate amount of the installments of the Severance Payment that would otherwise be paid pursuant to the preceding
provisions of this Section 7(f)(i) after March 15 of the calendar year following the calendar year in which the Termination
Date occurs (the “Applicable March 15”) exceeds the maximum exemption amount under Treasury Regulation
Section 1.409A-1(b)(9)(iii)(A), then such excess shall be paid to Employee in a lump sum on the Applicable March 15 (or the first
Business Day preceding the Applicable March 15 if the Applicable March 15 is not a Business Day) and the installments of the Severance
Payment payable after the Applicable March 15 shall be reduced by such excess (beginning with the installment first payable after
the Applicable March 15 and continuing with the next succeeding installment until the aggregate reduction equals such excess),
and (2) all remaining installments of the Severance Payment, if any, that would otherwise be paid pursuant to the preceding provisions
of this Section 7(f)(i) after December 31 of the calendar year following the calendar year in which the Termination Date
occurs shall be paid with the installment of the Severance Payment, if any, due in December of the calendar year following the
calendar year in which the Termination Date occurs. “Business Day” shall mean any day except a Saturday,
Sunday or other day on which commercial banks in New York, New York are authorized or required by law to be closed.

 

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(iv)
Notwithstanding anything herein to the contrary, the Severance Payment and COBRA Subsidy (and any portion thereof) shall not be
payable if Employee’s employment hereunder terminates upon the expiration of the then-existing Initial Term or Renewal Term,
as applicable, as a result of a non-renewal of the term of Employee’s employment under this Agreement by Employee pursuant
to Section 4.

 

(v)
If the Release is not executed and returned to the Company on or before the Release Expiration Date, and the required revocation
period has not fully expired without revocation of the Release by Employee, then Employee shall not be entitled to any portion
of the Termination Benefits. As used herein, the “Release Expiration Date” is that date that is twenty-one
(21) days following the date upon which the Company delivers the Release to Employee (which shall occur no later than seven (7)
days after the Termination Date) or, in the event that such termination of employment is “in connection with an exit incentive
or other employment termination program” (as such phrase is defined in the Age Discrimination in Employment Act of 1967),
the date that is forty-five (45) days following such delivery date.

 

(g)
After-Acquired Evidence. Notwithstanding any provision of this Agreement to the contrary, in the event that the Company
determines that Employee is eligible to receive the Termination Benefits pursuant to Section 7(f) but, after such determination,
the Company subsequently acquires evidence or determines that: (i) Employee has failed to abide by the terms of Sections 9,
10 or 11; or (ii) a Cause condition existed prior to the Termination Date that, had the Company been fully aware
of such condition, would have given the Company the right to terminate Employee’s employment pursuant to Section 7(a),
then upon written notice to Employee of a good faith reasonable belief of Employee’s breach or Cause condition the Employee
shall forfeit all unpaid Termination Benefits, and the Company shall have the right to cease the payment of any future installments
of the Termination Benefits, provided that such breach or Cause condition must remain uncured thirty (30) days after the
Board first provided Employee written notice of the obligation to cure such breach or Cause condition.

 

8.
Disclosures.

 

(a)
Employee hereby represents and warrants that as of the Effective Date, there exist no actual or potential Conflicts of Interest
(as defined below).

 

(b)
Promptly (and in any event, within three (3) Business Days) upon becoming aware of any actual or potential Conflict of Interest,
Employee shall disclose such actual or potential Conflict of Interest to the Board.

 

(c)
A “Conflict of Interest” shall exist when Employee engages in, or plans to engage in, any activities,
associations, or interests that conflict with, or create an appearance of a conflict with, Employee’s duties, responsibilities,
authorities, or obligations for and to any member of the Company Group.

 

9.
Confidentiality. In the course of Employee’s employment with the Company and the performance of Employee’s
duties on behalf of the Company Group hereunder, Employee will be provided with, and will have access to, Confidential Information
(as defined below). In consideration of Employee’s receipt and access to such Confidential Information, and as a condition
of Employee’s employment, Employee shall comply with this Section 9.

 

(a)
Both during the Employment Period and thereafter, except as expressly permitted by this Agreement or by directive of the Board,
Employee shall not disclose any Confidential Information to any person or entity and shall not use any Confidential Information
except for the benefit of the Company Group. Employee shall follow all Company Group policies and protocols regarding the security
of all documents and other materials containing Confidential Information (regardless of the medium on which Confidential Information
is stored). The covenants of this Section 9(a) shall apply to all Confidential Information, whether now known or later
to become known to Employee during the period that Employee is employed by or affiliated with the Company or any other member
of the Company Group.

 

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(b)
Notwithstanding any provision of Section 9(a) to the contrary, Employee may make the following disclosures and uses of
Confidential Information:

 

(i)
disclosures to other employees of a member of the Company Group who have a need to know the information in connection with the
businesses of the Company Group;

 

(ii)
disclosures to customers and suppliers when, in the reasonable and good faith belief of Employee, such disclosure is in connection
with Employee’s performance of Employee’s duties under this Agreement and is in the best interests of the Company
Group;

 

(iii)
disclosures and uses that are approved in writing by the Board; or

 

(iv)
disclosures to a person or entity that has (x) been retained by a member of the Company Group to provide services to one or more
members of the Company Group and (y) agreed in writing to abide by the terms of a confidentiality agreement.

 

(c)
Upon the expiration of the Employment Period, and at any other time upon request of the Company, Employee shall promptly surrender
and deliver to the Company all documents (including electronically stored information) and all copies thereof and all other materials
of any nature containing or pertaining to all Confidential Information and any other Company Group property (including any Company
Group-issued computer, mobile device or other equipment) in Employee’s possession, custody or control and Employee shall
not retain any such documents or other materials or property of the Company Group. Within five (5) days of any such request, Employee
shall certify to the Company in writing that all such documents, materials and property have been returned to the Company.

 

(d)
All trade secrets, non-public information, designs, ideas, concepts, improvements, product developments, discoveries and inventions,
whether patentable or not, that are conceived, made, developed or acquired by or disclosed to Employee, individually or in conjunction
with others, during the period that Employee is employed by the Company or any other member of the Company Group (whether during
business hours or otherwise and whether on the Company’s premises or otherwise) that relate to any member of the Company
Group’s businesses or properties, products or services (including all such information relating to corporate opportunities,
operations, future plans, methods of doing business, business plans, strategies for developing business and market share, research,
financial and sales data, pricing terms, evaluations, opinions, interpretations, acquisition prospects, the identity of customers
or acquisition targets or their requirements, the identity of key contacts within customers’ organizations or within the
organization of acquisition prospects, or marketing and merchandising techniques, prospective names and marks) is defined as “Confidential
Information.” Moreover, all documents, videotapes, written presentations, brochures, drawings, memoranda, notes,
records, files, correspondence, manuals, models, specifications, computer programs, e-mail, voice mail, electronic databases,
maps, drawings, architectural renditions, models and all other writings or materials of any type including or embodying any of
such information, ideas, concepts, improvements, discoveries, inventions and other similar forms of expression are and shall be
the sole and exclusive property of the Company or the other applicable member of the Company Group and be subject to the same
restrictions on disclosure applicable to all Confidential Information pursuant to this Agreement. For purposes of this Agreement,
Confidential Information shall not include any information that (i) is or becomes generally available to the public other than
as a result of a disclosure or wrongful act of Employee or any of Employee’s agents; (ii) was available to Employee on a
non-confidential basis before its disclosure by a member of the Company Group; or (iii) becomes available to Employee on a non-confidential
basis from a source other than a member of the Company Group; provided, however, that such source is not bound by
a confidentiality agreement with, or other obligation with respect to confidentiality to, a member of the Company Group.

 

    10

     

    

 

(e)
Notwithstanding the foregoing, nothing in this Agreement shall prohibit or restrict Employee from lawfully: (i) initiating communications
directly with, cooperating with, providing information to, causing information to be provided to, or otherwise assisting in an
investigation by, any governmental authority regarding a possible violation of any law; (ii) responding to any inquiry or legal
process directed to Employee from any such governmental authority (including the U.S. Securities and Exchange Commission); (iii)
testifying, participating or otherwise assisting in any action or proceeding by any such governmental authority relating to a
possible violation of law; or (iv) making any other disclosures that are protected under the whistleblower provisions of any applicable
law. Additionally, pursuant to the federal Defend Trade Secrets Act of 2016, an individual shall not be held criminally or civilly
liable under any federal or state trade secret law for the disclosure of a trade secret that: (A) is made (1) in confidence to
a federal, state or local government official, either directly or indirectly, or to an attorney and (2) solely for the purpose
of reporting or investigating a suspected violation of law; (B) is made to the individual’s attorney in relation to a lawsuit
for retaliation against the individual for reporting a suspected violation of law; or (C) is made in a complaint or other document
filed in a lawsuit or proceeding, if such filing is made under seal. Nothing in this Agreement requires Employee to obtain prior
authorization before engaging in any conduct described in this paragraph, or to notify the Company that Employee has engaged in
any such conduct.

 

10.
Non-Competition; Non-Solicitation.

 

(a)
The Company shall provide Employee access to Confidential Information for use only during the Employment Period, and Employee
acknowledges and agrees that the Company Group will be entrusting Employee, in Employee’s unique and special capacity, with
developing the goodwill of the Company Group, and in consideration of the Company providing Employee with access to Confidential
Information and as an express incentive for the Company to enter into this Agreement and employ Employee hereunder, Employee has
voluntarily agreed to the covenants set forth in this Section 10. Employee agrees and acknowledges that the limitations
and restrictions set forth herein, including geographical and temporal restrictions on certain competitive activities, are reasonable
in all respects, do not interfere with public interests, will not cause Employee undue hardship, and are material and substantial
parts of this Agreement intended and necessary to prevent unfair competition and to protect the Company Group’s Confidential
Information, goodwill and legitimate business interests.

 

    11

     

    

 

(b)
During the Prohibited Period, Employee shall not, without the prior written approval of the Board, directly or indirectly, for
Employee or on behalf of or in conjunction with any other person or entity of any nature:

 

(i)
engage in or participate, directly or indirectly, in the following conduct: (A) owning, managing, operating, or being an officer
or director of, any business that competes with any member of the Company Group in the Market Area related to the Business (except
for the ownership of up to 3.0% of the shares of common stock or securities or any entity whose common shares or securities are
listed on a national securities exchange), or (B) joining, becoming an employee or consultant of, or otherwise being affiliated
with, any person or entity engaged in, or planning to engage in, the Business in the Market Area in competition, or anticipated
competition, with any member of the Company Group in any capacity (with respect to this clause (B)) in which Employee’s
duties or responsibilities are the same as or similar to the duties or responsibilities that Employee had on behalf of any member
of the Company Group;

 

(ii)
solicit, canvass, approach, encourage, entice or induce any customer or supplier of any member of the Company Group with whom
or which Employee had personal contact in the course of performing Employee’s duties for any member of the Company Group
to cease or lessen such customer’s or supplier’s business with any member of the Company Group; or

 

(iii)
solicit, canvass, approach, encourage, entice or induce any employee or contractor of any member of the Company Group to terminate
or reduce his, her or its employment or engagement with any member of the Company Group. This provision shall not prohibit Employee
from employing or making an offer of employment to an employee or contractor of any member of the Company Group if such employment
and/or offer resulted from a general solicitation or advertisement for applications in a newspaper, trade publication, on the
Internet or other public forum.

 

(c)
Because of the difficulty of measuring economic losses to the Company Group as a result of a breach or threatened breach of the
covenants set forth in Section 9 and in this Section 10, and because of the immediate and irreparable damage that
would be caused to the members of the Company Group for which they would have no other adequate remedy, the Company and each other
member of the Company Group shall be entitled to enforce the foregoing covenants, in the event of a breach or threatened breach,
by injunctions and restraining orders from any court of competent jurisdiction, without the necessity of showing any actual damages
or that money damages would not afford an adequate remedy, and without the necessity of posting any bond or other security. The
aforementioned equitable relief shall not be the Company’s or any other member of the Company Group’s exclusive remedy
for a breach but instead shall be in addition to all other rights and remedies available to the Company and each other member
of the Company Group at law and equity.

 

(i)
If Employee violates his/her obligations during the Prohibited Period and the Company (or relevant member of the Company Group)
brings legal action for injunctive or other relief under Sections 9 and/or 10, the applicable Restricted Period shall be tolled
by such court of competent jurisdiction so that the Company Group shall not be deprived of the benefit of the full Prohibited
Period.

 

    12

     

    

 

(ii)
During the Prohibited Period, Executive expressly agrees to notify any prospective employer or affiliate in the restricted Business
and Market Area of his/her obligations during the Prohibited Period and authorizes the Company to make contact with, any person
or affiliate reasonably believed by the Company Group to be engaged or about to be engaged in an act that would constitute a violation
of Employee’s obligations under this Agreement. Employee hereby waives, and releases the Company Group from, any claims
whatsoever arising in connection with the Company Group’s contact or discussions with such person or affiliate.

 

(d)
The covenants in this Section 10, and each provision and portion hereof, are severable and separate, and the unenforceability
of any specific covenant (or portion thereof) shall not affect the provisions of any other covenant (or portion thereof). Moreover,
in the event any court of competent jurisdiction shall determine that the scope, time or territorial restrictions set forth are
unreasonable, then it is the intention of the parties that such restrictions be enforced to the fullest extent which such court
deems reasonable, and this Agreement shall thereby be reformed.

 

(e)
The following terms shall have the following meanings:

 

(i)
“Business” shall mean the business and operations that are the same or similar to those performed (or
as to which are proposed to be performed based on plans developed within the twelve (12) month period immediately prior to the
Termination Date) by the Company and any other member of the Company Group for which Employee provides services or about which
Employee obtains Confidential Information during the Employment Period.

 

(ii)
“Market Area” shall mean: (A) the United States; and (B) and any other geographic area or market where
or with respect to which the Company or any other member of the Company Group conducts or has specific plans to conduct the Business
on or at any time during the twelve (12) month period prior to the Termination Date.

 

(iii)
“Prohibited Period” shall mean the period during which Employee is employed by any member of the Company
Group and continuing for a period of twenty-four (24) months following the date that Employee is no longer employed by any member
of the Company Group.

 

11.
Ownership of Intellectual Property. Employee agrees that the Company shall own, and Employee shall (and hereby
does) assign, all right, title and interest (including patent rights, copyrights, trade secret rights, mask work rights, trademark
rights, and all other intellectual and industrial property rights of any sort throughout the world) relating to any and all inventions
(whether or not patentable), works of authorship, designs, know-how, ideas and information authored, created, contributed to,
made or conceived or reduced to practice, in whole or in part, by Employee during the period in which Employee is or has been
employed by or affiliated with the Company or any other member of the Company Group that relates to the Business (“Company
Intellectual Property”), and Employee shall promptly disclose all Company Intellectual Property to the Company.
All of Employee’s works of authorship and associated copyrights created during the period in which Employee is employed
by or affiliated with the Company or any other member of the Company Group and related to the Business shall be deemed to be “works
made for hire” within the meaning of the Copyright Act. Employee shall perform, during and after the period in which Employee
is or has been employed by or affiliated with the Company or any other member of the Company Group, all acts deemed necessary
by the Company to assist each member of the Company Group, at the Company’s expense, in obtaining and enforcing its rights
throughout the world in the Company Intellectual Property. Such acts may include execution of documents and assistance or cooperation
(i) in the filing, prosecution, registration, and memorialization of assignment of any applicable patents, copyrights, mask work,
or other applications, (ii) in the enforcement of any applicable patents, copyrights, mask work, moral rights, trade secrets,
or other proprietary rights, and (iii) in other legal proceedings related to the Company Intellectual Property.

 

    13

     

    

 

12.
Defense of Claims. The Company shall obtain and maintain directors’ and officers’ liability insurance
coverage in effect for Employee during the Employment Period and continuing thereafter so long as Employee shall be subject to
any possible claim or threatened, pending or completed action, suit or proceeding, whether civil, criminal, arbitrational, administrative
or investigative, by reason of the fact that Employee had served in the capacity or capacities referred to herein. During the
Employment Period and thereafter, upon request from the Company, Employee shall cooperate with the Company Group in the defense
of any claims or actions that may be made by or against any member of the Company Group that relate to Employee’s actual
or prior areas of responsibility.

 

13.
Withholdings; Deductions. The Company may withhold and deduct from any benefits and payments made or to be made
pursuant to this Agreement (a) all federal, state, local and other taxes as may be required pursuant to any law or governmental
regulation or ruling and (b) any deductions consented to in writing by Employee.

 

14.
Title and Headings; Construction. Titles and headings to Sections hereof are for the purpose of reference only and
shall in no way limit, define or otherwise affect the provisions hereof. Unless the context requires otherwise, all references
to laws, regulations, contracts, documents, agreements and instruments refer to such laws, regulations, contracts, documents,
agreements and instruments as they may be amended from time to time, and references to particular provisions of laws or regulations
include a reference to the corresponding provisions of any succeeding law or regulation. All references to “dollars”
or “$” in this Agreement refer to United States dollars. The words “herein”, “hereof”, “hereunder”
and other compounds of the word “here” shall refer to the entire Agreement, including all Exhibits attached hereto,
and not to any particular provision hereof. Unless the context requires otherwise, the word “or” is not exclusive.
Wherever the context so requires, the masculine gender includes the feminine or neuter, and the singular number includes the plural
and conversely. All references to “including” shall be construed as meaning “including without limitation.”
Neither this Agreement nor any uncertainty or ambiguity herein shall be construed or resolved against any party hereto, whether
under any rule of construction or otherwise. On the contrary, this Agreement has been reviewed by each of the parties hereto and
shall be construed and interpreted according to the ordinary meaning of the words used so as to fairly accomplish the purposes
and intentions of the parties hereto.

 

15.
Applicable Law; Submission to Jurisdiction. This Agreement shall in all respects be construed according to the laws
of the State of Texas without regard to its conflict of laws principles that would result in the application of the laws of another
jurisdiction. With respect to any claim or dispute related to or arising under this Agreement, the parties hereby recognize and
agree that should any resort to a court be necessary and permitted under this Agreement, then they consent to the exclusive jurisdiction,
forum and venue of the state and federal courts (as applicable) located in Austin, Texas.

 

    14

     

    

 

16.
Entire Agreement and Amendment. This Agreement contain the entire agreement of the parties with respect to the matters
covered herein and supersede all prior and contemporaneous agreements and understandings, oral or written, between the parties
hereto concerning the subject matter hereof, including the Original Agreement. This Agreement may be amended only by a written
instrument executed by both parties hereto.

 

17.
Waiver of Breach. Any waiver of this Agreement must be executed by the party to be bound by such waiver. No waiver
by either party hereto of a breach of any provision of this Agreement by the other party, or of compliance with any condition
or provision of this Agreement to be performed by such other party, will operate or be construed as a waiver of any subsequent
breach by such other party or any similar or dissimilar provision or condition at the same or any subsequent time. The failure
of either party hereto to take any action by reason of any breach will not deprive such party of the right to take action at any
time.

 

18.
Assignment. This Agreement is personal to Employee, and neither this Agreement nor any rights or obligations hereunder
shall be assignable or otherwise transferred by Employee. The Company may assign this Agreement without Employee’s consent,
including to any member of the Company Group and to any successor to or acquirer of (whether by merger, purchase or otherwise)
all or substantially all of the equity, assets or businesses of the Company.

 

19.
Notices. Notices provided for in this Agreement shall be in writing and shall be deemed to have been duly received
(a) when delivered in person, (b) when sent by facsimile transmission (with confirmation of transmission) on a Business Day to
the number set forth below, if applicable; provided, however, that if a notice is sent by facsimile transmission
after normal business hours of the recipient or on a non-Business Day, then it shall be deemed to have been received on the next
Business Day after it is sent, (c) on the first Business Day after such notice is sent by express overnight courier service, or
(d) on the second Business Day following deposit with an internationally-recognized second-day courier service with proof of receipt
maintained, in each case, to the following address, as applicable:

 

If
to the Company, addressed to:

 

Hyliion
Holdings Corp

1202 BMC Drive, Suite 100

Cedar
Park, TX 78613

Attention:
Human Resources

 

If
to Employee, addressed to:

 

Sherri
Baker

13219 Palmers Creek Terrace

Lakewood Ranch, Florida 34202

 

20.
Counterparts. This Agreement may be executed in any number of counterparts, including by electronic mail or facsimile,
each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute one and
the same instrument. Each counterpart may consist of a copy hereof containing multiple signature pages, each signed by one party,
but together signed by both parties hereto.

 

    15

     

    

 

21.
Deemed Resignations. Except as otherwise determined by the Board or as otherwise agreed to in writing by Employee
and any member of the Company Group prior to the termination of Employee’s employment with the Company or any member of
the Company Group, any termination of Employee’s employment shall constitute, as applicable, an automatic resignation of
Employee: (a) as an officer of the Company and each member of the Company Group; (b) from the Board; and (c) from the board of
directors or board of managers (or similar governing body) of any member of the Company Group and from the board of directors
or board of managers (or similar governing body) of any corporation, limited liability entity, unlimited liability entity or other
entity in which any member of the Company Group holds an equity interest and with respect to which board of directors or board
of managers (or similar governing body) Employee serves as such Company Group member’s designee or other representative.

 

22.
Section 409A.

 

(a)
Notwithstanding any provision of this Agreement to the contrary, all provisions of this Agreement are intended to comply with
Section 409A of the Internal Revenue Code of 1986 (the “Code”), and the applicable Treasury regulations
and administrative guidance issued thereunder (collectively, “Section 409A”) or an exemption therefrom
and shall be construed and administered in accordance with such intent. Any payments under this Agreement that may be excluded
from Section 409A either as separation pay due to an involuntary separation from service or as a short-term deferral shall be
excluded from Section 409A to the maximum extent possible. For purposes of Section 409A, each installment payment provided under
this Agreement shall be treated as a separate payment. No payment or benefits to be paid to Employee, if any, under this Agreement
or otherwise, when considered together with any other severance payments or separation benefits that are considered deferred compensation
under Section 409A will be paid or otherwise provided until the Employee has a “separation from service” within the
meaning of Section 409A.

 

(b)
To the extent that any right to reimbursement of expenses or payment of any benefit in-kind under this Agreement constitutes nonqualified
deferred compensation (within the meaning of Section 409A), (i) any such expense reimbursement shall be made by the Company no
later than the last day of Employee’s taxable year following the taxable year in which such expense was incurred by Employee,
(ii) the right to reimbursement or in-kind benefits shall not be subject to liquidation or exchange for another benefit, and (iii)
the amount of expenses eligible for reimbursement or in-kind benefits provided during any taxable year shall not affect the expenses
eligible for reimbursement or in-kind benefits to be provided in any other taxable year; provided, that the foregoing clause
shall not be violated with regard to expenses reimbursed under any arrangement covered by Section 105(b) of the Code solely because
such expenses are subject to a limit related to the period in which the arrangement is in effect.

 

(c)
Notwithstanding any provision in this Agreement to the contrary, if any payment or benefit provided for herein would be subject
to additional taxes and interest under Section 409A if Employee’s receipt of such payment or benefit is not delayed until
the earlier of (i) the date of Employee’s death or (ii) the date that is six (6) months after the Termination Date
(such date, the “Section 409A Payment Date”), then such payment or benefit shall not be provided to
Employee (or Employee’s estate, if applicable) until the Section 409A Payment Date. Notwithstanding the foregoing, the Company
makes no representations that the payments and benefits provided under this Agreement are exempt from, or compliant with, Section
409A and in no event shall any member of the Company Group be liable for all or any portion of any taxes, penalties, interest
or other expenses that may be incurred by Employee on account of non-compliance with Section 409A.

 

    16

     

    

 

23.
Certain Excise Taxes.

 

(a)
Notwithstanding anything to the contrary in this Agreement, if any payment or benefit Employee would receive from the Company
or any other party whether in connection with the provisions of this Agreement or otherwise (“Payment”)
would (i) constitute a “parachute payment” within the meaning of Section 280G of the Code, and (ii) but for this sentence,
be subject to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then such Payment
shall be equal to the Reduced Amount. The “Reduced Amount” shall be either (x) the largest portion of the Payment
that would result in no portion of the Payment being subject to the Excise Tax, or (y) the largest portion, up to and including
the total, of the Payment, whichever amount ((x) or (y)), after taking into account all applicable federal, state and local employment
taxes, income taxes, and the Excise Tax (all computed at the highest applicable marginal rate), results in Employee’s receipt
of the greatest economic benefit notwithstanding that all or some portion of the Payment may be subject to the Excise Tax. If
a Reduced Amount will give rise to the greater after tax benefit, the reduction in the Payments shall occur in the following order:
(a) reduction of cash payments; (b) cancellation of accelerated vesting of equity awards other than stock options; (c) cancellation
of accelerated vesting of stock options; and (d) reduction of other benefits paid to Employee. Within any such category of payments
and benefits (that is, (a), (b), (c) or (d)), a reduction shall occur first with respect to amounts that are not “deferred
compensation” within the meaning of Section 409A and then with respect to amounts that are. In the event that acceleration
of compensation from Employee’s equity awards is to be reduced, such acceleration of vesting shall be canceled, subject
to the immediately preceding sentence, in the reverse order of the date of grant.

 

(b)
The independent accounting firm engaged by the Company for general accounting and/or tax advisory purposes as of the day prior
to the effective date of the event described in Section 280G(b)(2)(A)(i) of the Code shall perform the foregoing calculations.
If the independent accounting firm so engaged by the Company is serving as accountant or auditor for the individual, entity or
group effecting such event, the Company shall appoint an independent accounting firm to make the determinations required hereunder.
The Company shall bear all expenses with respect to the determinations by such independent accounting firm required to be made
hereunder. The independent accounting firm engaged to make the determinations hereunder shall provide its calculations, together
with detailed supporting documentation, to the Company and Employee within thirty (30) calendar days after the date on which Employee’s
right to a Payment is triggered (if requested at that time by the Company or Employee) or such other time as reasonably requested
by the Company or Employee. Any good faith determinations of the independent accounting firm made hereunder shall be final, binding
and conclusive upon the Company and Employee.

 

24.
Effect of Termination. The provisions of Sections 7, 9-13 and 21 and those provisions
necessary to interpret and enforce them, shall survive any termination of this Agreement and any termination of the employment
relationship between Employee and the Company.

 

25.
Third-Party Beneficiaries. Each member of the Company Group that is not a signatory to this Agreement shall be a
third-party beneficiary of Employee’s obligations under Sections 8, 9, 10, 11 and 21
and shall be entitled to enforce such obligations as if a party hereto.

 

26.
Severability. Other than as set forth in Section 10(d), if a court of competent jurisdiction determines that any
provision of this Agreement (or portion thereof) is invalid or unenforceable, then the invalidity or unenforceability of that
provision (or portion thereof) shall not affect the validity or enforceability of any other provision of this Agreement, and all
other provisions shall remain in full force and effect.

 

27.
Non-Disparagement. Employee shall not, directly or indirectly, make or cause to be made any disparaging, denigrating,
derogatory, misleading, or false statement orally or in writing to any person, including clients or prospective clients, competitors
and advisors to the Company Group and members of the investment community or press, about (i) the Company and/or Company Group,
or its/their members, managers, officers, employees, agents, or clients, or (ii) the business strategy or plans, policies, practices,
or operations of the Company Group. Notwithstanding the foregoing, nothing in this section is intended to prevent Employee from
making truthful statements to his attorney of record and/or any other government or law enforcement agency or official, or as
otherwise required by applicable subpoena or court order.

 

    17

     

    

 

IN
WITNESS WHEREOF, Employee and the Company each have caused this Agreement to be executed, and intend this Agreement to become
effective as of the Effective Date.

 

	 	EMPLOYEE
	 	 
	 	 	 	 
	 	HYLIION
    HOLDINGS CORP.
	 	 	 	 
	 	By: 	 
	 	 	Name:	Thomas Healy
	 	 	Title:	Chief Executive Officer

 

Signature
Page to

Employment
Agreement

 

 

18Document

NEUROMETRIX, INC.
Amended and Restated Management Retention and Incentive Plan
1.Purpose of the Plan.  The purpose of this Management Retention and Incentive Plan (the “Plan”) is to provide the executive officers and certain other key employees of NeuroMetrix, Inc., a Delaware corporation (the “Company”), listed on Schedule A hereto (the “Participants,” and each, a “Participant”) with consideration in the event of a Change of Control Transaction (as defined below) involving the Company and another entity (the “Successor Company”) based on the allocations listed on Schedule A hereto (the “Percentage Interest”).  These allocations relate to the Total Consideration (as defined below) to be received in the Change of Control Transaction by the Company and/or its stockholders.  The Plan is designed to retain the Company’s executive officers and certain key employees while providing an incentive to build corporate value.   This Plan, as amended, shall be effective as of February 23, 2021.
2.Definitions.  For the purposes of this Plan, capitalized terms not defined in Section 1 above shall have the following meanings:
(a)Additional Plan Consideration shall mean, for any Participant, the portions of the Contingent Consideration to be received by the Participant pursuant to the Plan as calculated pursuant to Section 6 of the Plan.
(b)Board shall mean the Board of Directors of the Company.
(c)Change of Control Transaction shall mean the first to occur of the following events:
(i)Ownership Change through Company Stock Sale or Third Party Tender Offer:  any “person” or “group” as such terms are used in Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934 (the “Act”), becomes a beneficial owner, as such term is used in Rule 13d-3 promulgated under the Act, of securities of the Company representing more than 50% of the combined voting power of the outstanding securities of the Company having the right to vote in the election of directors.  This is not intended to include equity financing transactions involving passive, non-strategic investors; or
(ii)Merger Transaction:  a merger or consolidation involving the Company or a wholly-owned subsidiary of the Company, other than a merger or consolidation in which the voting securities of the Company outstanding immediately prior to such transaction continue to represent (either by remaining outstanding or by conversion into voting securities of the surviving entity or the parent of such corporation) more than fifty percent (50%) of the total voting power represented by the voting securities of the Company or such surviving entity or parent of such corporation, as the case may be, outstanding immediately after such merger or consolidation; or

(iii)Sale of Assets:  the sale or disposition by the Company of all or substantially all of the Company’s assets in a transaction requiring stockholder approval;
provided that a Change of Control Transaction shall be interpreted in a manner, and limited to the extent necessary, so that it will not cause adverse tax consequences under Section 409A of the Code.
(d)Code shall mean the Internal Revenue Code of 1986, as amended, including any successor statute, regulation and guidance thereto.
(e)Common Stock shall mean the common stock, $0.0001 par value per share, of the Company.
(f)Common Stock Equivalents shall mean rights, options, or other instruments to subscribe for, purchase or otherwise acquire Common Stock pursuant to any equity plan of the Company.
(g)Contingent Consideration shall mean the portion of the Total Consideration to be received after the date of the closing of the Change of Control Transaction, the receipt of which will be contingent upon the passage of time or the occurrence or non-occurrence of some event(s) or circumstance(s), including, without limitation, amounts of Total Consideration subject to an escrow, a purchase price adjustment, an earn-out, or indemnity claims.
(h)Initial Consideration shall mean the amount of the Total Consideration that is not Contingent Consideration.
(i)Initial Plan Consideration shall mean, for any Participant, the portion of the Initial Consideration to be received by the Participant pursuant to the Plan as calculated pursuant to Section 6 of the Plan.
(j)Plan Consideration shall mean, for any Participant, the portion of the Total Consideration to be received by the Participant pursuant to the Plan as calculated pursuant to Section 6 of the Plan which shall be comprised of the Initial Plan Consideration and any Additional Plan Consideration.
(k)Representative shall mean one or more members of the Board or persons designated by the Board prior to, or in connection with the Change of Control Transaction.
(l)Total Consideration shall mean the total amount of cash and the fair market value of all other consideration paid or payable including Contingent Consideration by the Successor Company or any other person to the Company or its securityholders in connection with the Change of Control Transaction, including amounts paid or payable in respect of convertible securities, warrants, stock appreciation rights, option or similar rights, whether or not vested and any additional amounts paid by the Successor Company in connection with this Plan, 
2

less (i) transaction fees incurred in the course of the Change of Control Transaction (such as fees related to legal services, accounting services, financial advisory services, investment banking services or other professional services), plus (ii) any debt or other liabilities of the Company that are paid off, satisfied or otherwise assumed by the Successor Company, specifically including, but not limited to, any bank debt or line of credit and accounts payable (excluding any liabilities under this Plan), and less (iii) any taxes payable by the Company (but not those payable by the stockholders) as a result of the Change of Control Transaction.  The fair market value of any securities (whether debt or equity) or other property shall be determined as follows:
(i)the value of securities that are freely tradable in an established public market will be determined by the method or methods set forth in the applicable contract or contracts concerning the Change of Control Transaction; and
(ii)the value of securities that are not freely tradable or have no established public market, and the value of aggregate consideration that consists of other property, shall be the fair market value as determined in good faith by the Board;
provided however, notwithstanding the foregoing, that in the event of a Change of Control Transaction that is effected in the form of a reverse merger, in which shares of Common Stock are issued to the securityholders of a third party, the Total Consideration shall mean the product of: (a) the number of shares of Common Stock outstanding immediately prior to the closing of the Change of Control Transaction; and (b) the closing price of the Common Stock, as reported on the principal stock exchange on which the Common Stock is then traded, on the closing date of the Change of Control Transaction; provided further, however, that the number of outstanding shares of Common Stock and the closing price shall be appropriately adjusted as necessary to reflect any stock split, reverse stock split or other structural reorganization. In such event, the Total Consideration shall be deemed to be Initial Plan Consideration for purposes of this Agreement.

3.Interpretation and Administration of the Plan.  Prior to the Change of Control Transaction, the administrator of the Plan will be the Compensation Committee of the Board. After the Change of Control Transaction, the administrator of the Plan will be the Representative.  The administrator will be responsible for interpreting and administering all provisions hereof.  All actions taken by the administrator in interpreting the terms of the Plan and administration of the Plan will be final, binding and conclusive on all Participants.  The administrator shall not be personally liable by reason of any contract or other instrument related to the Plan executed by an individual or on its or their behalf in its or their capacity as the administrator, or for any mistake of judgment made in good faith, and the Company shall indemnify and hold harmless each individual to whom any duty or power relating to the administration or interpretation of the Plan may be allocated or delegated, against any cost or expense (including legal fees) or liability arising out of any act or omission to act in connection with the Plan unless arising out of such person’s own fraud or bad faith.
4.Eligibility to Earn Plan Consideration.  Except as otherwise provided in Section 8 below, each Participant will have the right to receive Plan Consideration, subject to the 
3

Participant’s continued employment or service with the Company through the date of the closing of the Change of Control Transaction unless terminated by the Company other than for cause within 180 days prior to the announcement of the Change of Control Transaction.  If a Participant’s service to the Company in all capacities (whether as an employee, consultant, advisor, director or any other service provider) terminates for any reason prior to the date of the closing of the Change of Control Transaction (other than by the Company not for cause within 180 days of the announcement of the Change of Control Transaction), whether initiated by the Company or the Participant, and with or without cause, then such Participant shall no longer be considered a “Participant” thereafter for purposes of the Plan, and such Participant will not be entitled to receive any Plan Consideration hereunder.  The Company in its sole discretion will determine whether a Participant’s service relationship has terminated for this purpose.
5.Type of Plan Consideration.  Pursuant to this Plan, the Participants who are employed by the Company on the date of the closing of a Change of Control Transaction, or whose employment is terminated by the Company not for cause within 180 days of a Change of Control Transaction, shall receive their Plan Consideration from the Successor Company in cash and at the times set forth in Section 7 of the Plan.
6.Calculation of Plan Consideration.  Each Participant’s Plan Consideration shall be calculated as follows:
The Initial Plan Consideration shall be calculated on the date of the closing of the Change of Control Transaction by multiplying the Participant’s Percentage Interest by the Initial Consideration. 
The Additional Plan Consideration shall be calculated by multiplying the Contingent Consideration to be received by a fraction the numerator of which is each Participant’s Initial Plan Consideration and the denominator of which is the Initial Consideration.
7.Payment of Plan Consideration.  If the conditions for earning the Plan Consideration set forth herein are satisfied, each Participant will be entitled to earn and be paid his or her Plan Consideration as follows:
(a)Each Participant will be paid by the Successor Company from the Initial Consideration the Participant’s Initial Plan Consideration in a lump sum by no later than the thirtieth (30th) day following the date of the closing of the Change of Control Transaction.
(b)Each Participant will be paid by the Successor Company from the Contingent Consideration the Participant’s Additional Plan Consideration in lump sums, as, if and when the Contingent Consideration is paid or released to the Company or its stockholders.  However, if a condition (as described in Treasury Regulation Section 1.409A-1(d)), when applied to any Contingent Consideration, would not constitute a “substantial risk of forfeiture” (as defined in Treasury Regulation Section 1.409A-1(d)), and Section 1.409A-3(i) (5) (B) such that the Additional Plan Consideration related to such condition would not be reasonably likely to be payable in compliance with either Treasury Regulation Section 1-409A-1(b)(4) or Treasury Regulation Section 1.409A-3(i)(5)(iv)(A), or the Board determines 
4

in its reasonable good faith that any Additional Plan Consideration is not otherwise payable under the regular payment schedule of this Plan in compliance with or under an exemption from Section 409A of the Code, then the Participant instead will be paid the fair market value (as of the date of the closing of the Change of Control Transaction), as determined by the Board in its reasonable good faith, of the Additional Plan Consideration related to such condition (that is, the present value of the Additional Plan Consideration that may be earned upon satisfaction of the condition), in a lump-sum on the thirtieth (30th) day following the date of the closing of the Change of Control Transaction.
(c)It is intended that each installment of the payments provided under the Plan is a separate “payment” for purposes of Section 1.409A-2(b)(2)(i) of the Treasury Regulations.  For the avoidance of doubt, it is intended that the Plan Consideration satisfy, to the greatest extent possible, the exemption from the application of Section 409A of the Code and the Treasury Regulations and other guidance issued thereunder and any state law of similar effect (collectively “Section 409A”) provided under Treasury Regulations Section 1.409A-1(b)(4) and, to the extent not so exempt, that the Plan Consideration comply, and the Plan be interpreted to the greatest extent possible as consistent, with Treasury Regulations Section 1.409A-3(i)(5)(iv)(A) – that is, as “transaction-based compensation.”  Accordingly, any Plan Consideration will only be paid pursuant to this transaction-based exemption from Section 409A in the case of a Change of Control Transaction that is also a “change in ownership of a corporation” or “change in ownership of a substantial portion of a corporation’s assets” defined in Treasury Regulation Sections 1.409A-3(i)(5)(v) and (vii).  Additionally, no Plan Consideration that is being paid in reliance on the transaction-based exemption from Section 409A will be earned or paid after the fifth (5th) anniversary of the date of the closing of the Change of Control Transaction and the Participants will not be entitled to any payments under the Plan with respect to any Contingent Consideration after such date, subject, however, to Treasury Regulation Section 1.409A-3(g) (regarding timing of payments for certain disputed payments).
8.Release.  As a further condition to earning any Plan Consideration, a Participant must execute and allow to become effective a general release of claims in substantially the form of Exhibit A1 hereto prior to the thirtieth (30th) day following the date of the closing of the Change of Control Transaction, and if the form of release is provided to the Participant sooner than the date of the closing of the Change of Control Transaction, within thirty (30) days of the date the Participant receives the form of release.  If any Participant refuses to execute such release and allow it to become effective within such time period, then such Participant will not be eligible to earn Plan Consideration, and the Participant’s rights under this Plan to receive any consideration will be forfeited.
9.Withholding of Compensation.  The Successor Company will withhold from any payments under the Plan any amount required to satisfy the income and employment tax withholding obligations arising under applicable federal, state and local laws in respect of the Plan Consideration.  Each Participant should contact his or her personal legal or tax advisors with respect to the benefits provided by the Plan.  Neither the Company nor any of its employees, 
5

directors, officers or agents are authorized to provide any tax advice to Participants with respect to the benefits provided under the Plan.
10.Adjustments for Excess Parachute Payments.  In the event that (A) any consideration to be received by the Participant in connection with a Change of Control Transaction (whether pursuant to the terms of the Plan or any other plan, arrangement, or agreement with the Company, any person whose actions result in a Change of Control Transaction, or any person affiliated with the Company or such person) (collectively “Parachute Payments”) would not be deductible by the Successor Company, an affiliate or other person making such payment or providing such benefit (in whole or part) as a result of Section 280G of the Code; and (B) it is determined in good faith by the administrator that the net after-tax amount of the Parachute Payments retained by the Participant after deduction for any excise tax imposed by Section 4999 of the Code and any federal, state, and local income and employment taxes would not exceed the net after-tax amount of the Parachute Payments retained by the Participant after limiting the Parachute Payments to an amount that is 2.99 times the Participant’s “base amount” (as such term is defined by Section 280G of the Code), then the Parachute Payments shall be reduced until no portion of the Parachute Payments is not deductible.
For purposes of this provision,
(i)no portion of the Parachute Payments the receipt or enjoyment of which the Participant shall have effectively waived in writing prior to the date of payment of the Parachute Payments shall be taken into account;
(ii)no portion of the Parachute Payments shall be taken into account which in the opinion of the Company’s or the Successor Company’s independent auditors or tax counsel serving as such immediately prior to the Change of Control Transaction (or other tax counsel selected by the administrator) does not constitute a “parachute payment” within the meaning of Section 280G(b)(2) of the Code;
(iii)the Parachute Payments shall be reduced only to the extent necessary so that the Parachute Payments (other than those referred to in the immediately preceding clause (i) or (ii)) in their entirety constitute reasonable compensation for services actually rendered within the meaning of Section 280G(b)(4) of the Code or are otherwise not subject to disallowance as deductions, in the opinion of the auditor or tax counsel referred to in such clause (ii); and
(iv)the value of any non-cash benefit or any deferred payment or benefit included in the Parachute Payments shall be determined by the Company’s or the Successor Company’s independent auditors or tax counsel based on Sections 280G and 4999 of the Code and the regulations for applying those Code Sections, or on substantial authority within the meaning of Section 6662 of the Code.
11.Amendments.  This Plan may be amended by the Compensation Committee or the Board, as applicable at any time to amend Schedule A of this Plan to add additional Participants.  
6

In addition, the Plan may also be amended at any time by the Compensation Committee or the Board, as applicable, provided that no amendment shall adversely affect the rights of a Participant hereunder without the written consent of such Participant.  Notwithstanding anything herein to the contrary, the Board reserves the right to equitably adjust the Percentage Interest of a Participant if, in the context of an actual Change of Control Transaction, the definitions or calculations herein do not fairly represent the parties’ understanding regarding the amount, allocation or payment of the sale proceeds to Participants.
12.Not a Condition of Employment; No Guarantee of Employment.  The Plan is not a term or condition of any individual’s employment and no Participant shall have any legal right to payments hereunder except to the extent that all conditions required by a Participant have been satisfied in accordance with the terms set forth herein.  The Plan is intended to provide a financial incentive to Participants and is not intended to confer upon Participants any rights to continued employment, consultancy or other service provider relationship other than those set out in any separate agreement between the Company and such individuals governing such relationship. Each such Participant’s service may be terminated by the Company, the Successor Company or the Participant at any time for any reason, subject to any agreements then in effect regarding such Participant’s service or the termination thereof.
13.No Equity Interest; Status as Creditor.  Neither the Plan nor the Percentage Interest hereunder creates or conveys any equity or ownership interest in the Company or any rights commonly associated with any such interest, including, but not limited to, the right to vote on any matters put before the Company’s stockholders.  A Participant’s sole right under the Plan will be as a general unsecured creditor of the Company and the Successor Company.
14.No Assignment or Transfer by Participant.  None of the rights, benefits, obligations or duties under the Plan may be assigned or transferred by any Participant except by will or under the laws of descent and distribution.  Any purported assignment or transfer by any such Participant will be void.
15.Assumption by Successor Company.  As a condition to the consummation of a Change of Control Transaction, in addition to any obligations imposed by law upon the Successor Company, the Company shall require the Successor Company to expressly assume the Plan and agree to perform obligations hereunder.  All payments under this Plan shall be made by the Successor Company.  Neither the Company nor any former or current director, officer, employee or consultant of the Company, nor any agent of any such person or of the Company, shall be personally liable in the event the Company is unable to make payments under this Plan.
16.Severability.  If any provision of the Plan is held invalid or unenforceable, its invalidity or unenforceability will not affect any other provision of the Plan, and the Plan will be construed and enforced as if such provision had not been included.
17.Governing Law.  This Plan and the rights and obligations of a Participant under the Plan will be governed by and interpreted, construed and enforced in accordance with the laws of the State of Delaware, without reference to principles of conflict of laws.  The parties hereby 
7

submit to the jurisdiction of the state and federal courts of the Commonwealth of Massachusetts for the resolution of any claims, disputes or other proceedings arising under this Plan.
18.Entire Agreement.  The Plan sets forth all of the agreements and understandings between the Company and the Participants with respect to the subject matter hereof, and supersedes and terminates all prior agreements and understandings between the Company and the Participants with respect to the subject matter hereof.

8

SCHEDULE A

									
	

NAME
		PERCENTAGE 
INTEREST

			
	Gozani		5.60%

	Higgins		2.30%
	XXXX XXXX		1.20%
	XXXX XXXX

		1.08%

Schedule A

Exhibit A1
FORM OF GENERAL RELEASE
I understand that I am a Participant in the Management Retention and Incentive Plan (the “Plan”) of NeuroMetrix, Inc. (the “Company”).  In consideration of receiving certain benefits under the Plan, I have agreed to sign this Release.  I understand that I am not entitled to benefits under the Plan unless I sign this Release on or before ___________.1/
In consideration for the benefits I am receiving under the Plan, I hereby release (i) the Company; (ii) the [name of Successor Company will be inserted at time of the Change of Control Transaction] (the “Successor Company”); and (iii) each of the foregoing person’s respective current and former officers, directors, agents, attorneys, employees, shareholders, parents, subsidiaries, and affiliates (collectively, the “Releasees”) from any and all claims, liabilities, demands, causes of action, attorneys’ fees, damages, or obligations of every kind and nature, whether or not arising from contract, intentional or negligent tort, fraud, fraud in the inducement, breach of fiduciary duty or duty of loyalty, local, state or federal ordinance, rule, regulation or statute, or any other matter and whether known or unknown, (collectively, “Claims”) arising at any time prior to and including the date I sign this Release (the “Release Date”).  This general release includes, but is not limited to, any Claims related to or arising out of:  (i) my employment with the Company; (ii) my rights as a shareholder of the Company, including my entitlement to receive any stock, option or any other equitable interest or right convertible into an equity interest in the Company; (iii) any contract, whether express or implied, written or oral; (iv) any tort, including tort of wrongful termination; and (v) the United States Constitution, any State Constitution, or any federal, state or other governmental statute, regulation or ordinance, including, without limitation, the National Labor Relations Act, Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act of 1967, the Older Workers’ Benefit Protection Act of 1990, the Americans with Disabilities Act of 1990, the Civil Rights Act of 1871, the Civil Rights Act of 1991, the Equal Pay Act of 1963, the Worker Adjustment and Retraining Notification Act of 1988, the Employee Retirement Income Security Act of 1974, and the Massachusetts Fair Employment Practices Act, the Massachusetts Wage and Hour Laws, [all other applicable state law statutes for employees employed in states other than Massachusetts], all as amended.
I understand and expressly agree that this Release extends to all claims prior to the Release Date of every nature and kind whatsoever, known or unknown, suspected or unsuspected, past or present.
I warrant that as of the Release Date, I have not commenced, initiated or made any Claim and that I will not at any time thereafter commence, initiate or make any Claim whatsoever, whether direct or indirect, express or derivative, against the Company, the Successor Company or any of the Releasees, in respect of any Released Matter.  Notwithstanding the above, I understand that I am not releasing any of the following rights and may after the Release Date initiate an action to enforce the following rights:  (1) any Claim that cannot be waived under 

1/    Insert date that is 30 days from date of Participant’s receipt.
Exhibit A - 1

applicable state or federal law, (2) any rights that I have to be indemnified (including any right to reimbursement of expenses), arising under applicable law, the Certificate of Incorporation or by-laws (or similar constituent documents of the Company) or any indemnification agreement between me and the Company, or any directors’ and officers’ liability insurance policy of the Company, for any liabilities arising from my actions within the course and scope of my employment with the Company or within the course and scope of my role as a member of the Board of Directors of the Company, (3) claims for any amounts due to me under the Plan, (4) claims for vested retirement benefits under any tax-qualified retirement plan of the Company, or (5) claims for any compensation or bonuses that have been earned and accrued for periods ending on or prior to the Release Date, but which have not yet been paid.  I am not releasing and nothing in this Release will prevent me from filing, cooperating with, or participating in any proceeding before the Equal Employment Opportunity Commission, or the Department of Labor, except that I hereby acknowledge and agree that I will not recover any monetary benefits in connection with any such proceeding with regard to any Claim released in this Release.  Nothing in this Release will prevent me from challenging the validity of my general release in a legal or administrative proceeding.
By signing and returning this Agreement, I acknowledge that:
(1)    I have carefully read and fully understand the terms of the Plan and this Release;
(2)    I have entered into this Release voluntarily and I knowingly release all Claims that I may have against the Company, the Successor Company and the Releasees; and
(3)    The Company advised me that I have the right to and that I should consult with an attorney of my choosing prior to signing this Release.
I may review and consider this Release for a period of up to twenty-one (21) days from the date that I receive it.  I agree and understand that my failure to execute and deliver this Release on or before twenty-one (21) days after the date I receive it will release the Company and the Successor Company from any obligation under the Plan to provide any benefits to me.  To the extent I execute this Release within less than twenty-one (21) days after the date I receive it, I acknowledge that my decision was entirely voluntary and that I waive the balance of my time.
I will be entitled to revoke this Release at any time within seven (7) days, provided I timely execute and deliver to the Company a written revocation of this Release.  Such revocation must be delivered in writing, by certified mail, by hand or courier service (signature of receipt required) within the time permitted to the Chief Executive Officer of the Company at his or her office.  If I elect to exercise this right to revoke this Release, I understand that I will forfeit any and all rights to receive any benefits that might otherwise be due to me under the Plan following my revocation.

Exhibit A - 2

I acknowledge that the Company may be required to withhold taxes on amounts to be paid to me under the Plan.
I understand and accept that the final decision as to the amounts that I have earned under the Plan will be made by the Board of Directors of the Company in accordance with the Plan.
Date:          By:      
        Name:

Exhibit A - 3

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