UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
(e) On November 3, 2021, the compensation committee (the “Committee”) of the board of directors of Rocket Lab USA, Inc., a Delaware corporation (the “Company”) approved and adopted the Executive Severance Plan (the “Severance Plan”), in which the Company’s named executive officers participate, subject to their execution of a participation agreement.
The Severance Plan provides that upon a (A) termination by us other than for “cause”, death or “disability” or (B) resignation for “good reason”, as each term is defined in the Severance Plan, in each case outside of the “change in control period” (i.e., the period of one year after a “change in control,” as defined in the Severance Plan), an eligible participant will be entitled to receive, subject to the execution and delivery of an effective and irrevocable release of claims in favor of the Company and continued compliance with all applicable restrictive covenants, (i) 12 months of “base salary” (i.e., the higher of the annual base salary in effect immediately prior to the date of termination or the annual base salary in effect for the year immediately prior to the year in which the date of termination occurs) for our Chief Executive Officer, Mr. Peter Beck, and six months for Tier 2 officers (which is determined by the plan administrator and include Mr. Adam Spice, the Company’s Chief Financial Officer, and Mr. Shaun O’Donnell, the Company’s Executive Vice President, Global Operations) and (ii) an amount equal to the monthly employer contribution, based on the premiums as of the date of termination, that we would have made to provide health insurance for the applicable executive if he or she had remained employed by us for up to 12 months for our Chief Executive Officer and six months for Tier 2 officers. The payments under (i) and (ii) will be paid in substantially equal installments in accordance with our payroll practice over 12 months for our Chief Executive Officer, and six months for Tier 2 officers.
The Severance Plan also provides that upon a (A) termination by us other than for cause, death or disability or (B) resignation for good reason, in each case within the change in control period, an eligible participant will be entitled to receive, in lieu of the payments and benefits above and subject to the execution and delivery of an effective and irrevocable release of claims in favor of the Company and continued compliance with all applicable restrictive covenants, (I) a lump sum amount equal to 150% of the base salary and 150% of the target annual bonus in effect immediately prior to the date of termination (or immediately prior to the change in control, if higher) for our Chief Executive Officer and 100% of the base salary and 100% of the target annual bonus in effect immediately prior to the date of termination (or immediately prior to the change in control, if higher) for our Tier 2 officers, (II) a lump sum amount equal to the monthly employer contribution, based on the premiums as of the date of termination, that we would have made to provide health insurance for the applicable executive if he or she had remained employed by us for 18 months for our Chief Executive Officer and 12 months for our Tier 2 officers, and (III) for all outstanding and unvested equity awards of the Company that are subject to time-based vesting held by the participant, full accelerated vesting of such awards; provided, that the performance conditions applicable to any outstanding and unvested equity awards subject to performance-based vesting will be deemed satisfied at the target levels in accordance with the terms of the applicable award agreement.
The payments and benefits provided under the Severance Plan in connection with a change in control may not be eligible for a federal income tax deduction by the Company pursuant to Section 280G of the Internal Revenue Code, or Code. These payments and benefits may also subject an eligible participant to an excise tax under Section 4999 of the Code. If the payments or benefits payable in connection with a change in control would be subject to the excise tax imposed under Section 4999 of the Code, then those payments or benefits will be reduced if such reduction would result in a higher net after-tax benefit to the participant.
The foregoing description of the Severance Plan is qualified in its entirety by reference to the full text of the Severance Plan, a copy of which is filed as Exhibit 10.1 to this Current Report on Form 8-K.
On November 3, 2021, the Committee also approved and adopted new forms of award agreements under the Company’s 2021 Stock Option and Incentive Plan, pursuant to which certain awards may be granted to the Company’s named executive officers and non-employee directors, including a new form of Restricted Stock Unit Award Agreement for Employees, Restricted Stock Unit Award Agreement for Non-Employee Directors, Restricted Stock Award Agreement for Employees, Non-Qualified Stock Option Agreement for Non-Employee Directors, Non-Qualified Stock Option Agreement for Employees and Incentive Stock Option Agreement, which are included as Exhibits 10.2, 10.3, 10.4, 10.5, 10.6 and 10.7 to this Form 8-K and are incorporated in this Item 5.02 by reference.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
| Exhibit No. |
Description | |
| 10.1* | Rocket Lab USA, Inc. Executive Severance Plan | |
| 10.2 | Form of Restricted Stock Unit Award Agreement for Employees | |
| 10.3 | Form of Restricted Stock Unit Award Agreement for Non-Employee Directors | |
| 10.4 | Form of Restricted Stock Award Agreement for Employees | |
| 10.5 | Form of Non-Qualified Stock Option Agreement for Non-Employee Directors | |
| 10.6 | Form of Non-Qualified Stock Option Agreement for Employees | |
| 10.7 | Form of Incentive Stock Option Agreement | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). | |
| * | Certain information contained in exhibits has been omitted pursuant to Item 601(b)(10)(iv) of Regulation S-K. The Company hereby undertakes to furnish supplementally such omitted information upon request by the SEC. | |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: November 9, 2021 | Rocket Lab USA, Inc. | |||||
| By: | /s/ Adam Spice | |||||
| Adam Spice | ||||||
| Chief Financial Officer | ||||||