Green Dot Corporation Executive Severance Agreement
Exhibit 10.12
Green Dot Corporation
This Executive Severance Agreement (the “Agreement”) is made and entered into effective as of
, 2010 (the “Effective Date”), by and between (“Employee”) and Green
Dot Corporation, a Delaware corporation (the “Company”).
1. Definitions. As used in this Agreement, the following terms shall have the
following meanings:
(a) “Cause” means any of the following: (i) Employee’s conviction of or plea of nolo
contendere to a felony; (ii) an act by Employee which constitutes gross misconduct in the
performance of Employee’s employment obligations and duties; (iii) Employee’s act of fraud against
the Company or any of its affiliates; (iv) Employee’s theft or misappropriation of property
(including without limitation intellectual property) of the Company or its affiliates; (v) material
breach by Employee of any confidentiality agreement with, or duties of confidentiality to, the
Company or any of its affiliates that involves Employee’s wrongful disclosure of material
confidential or proprietary information (including without limitation trade secrets or other
intellectual property) of the Company or of any of its affiliates; (vi) Employee’s continued
material violation of Employee’s employment obligations and duties to the Company (other than due
to Employee’s death or Disability) after the Company has delivered to Employee a written notice of
such violation that describes the basis for the Company’s belief that such violation has occurred
and Employee has not substantially cured such violation within thirty (30) calendar days after such
written notice is given by the Company.
(b) “Code” means the United States Internal Revenue Code of 1986, as amended and the
regulations promulgated thereunder.
(c) “Termination Without Cause” means any involuntary termination of Employee’s employment by
the Company which is not effected for Cause (except for terminations due to Employee’s death or
Disability, either of which shall not constitute a Termination Without Cause).
(d) “Disability” has the meaning set forth in Section 22(e)(3) of the Code.
(e) “Termination Date” shall mean the effective date of any notice of termination delivered by
the Company to Employee.
2. Term of Agreement and Amendment. This Agreement shall terminate upon the date that
all obligations of the parties hereto under this Agreement have been satisfied. Notwithstanding the
foregoing, this Agreement may be amended, modified or terminated at any time in a writing signed by
both the Company (which for these purposes shall be the Chair of the Compensation Committee where
the Employee is the Company’s Chief Executive Officer and for all other Employees, the Company’s
Chief Executive Officer).
3. At-Will Employment. The Company and Employee acknowledge that Employee’s
employment is and shall continue to be at-will.
Without limiting the foregoing, Employee agrees that, to the extent practicable, Employee will provide the Company with at least ninety (90) days’ advance written notice of Employee’s termination of employment with the Company.
4. Severance Benefits and Equity Acceleration.
(a) Subject to the provisions of this Agreement (including without limitation the provisions
of Sections 5 and 6 hereof) if, after the Effective Date of this Agreement, Employee’s employment
with the Company is terminated by the Company in a Termination Without Cause then, after
the execution and nonrevocation by Employee of a general release of claims in favor of the
Company (which shall not include any release by Employee of claims with respect to which Employee
is entitled to indemnification from the Company) (the “Release”), Employee shall be entitled to the
following severance benefits:
(i) a lump sum cash severance payment in an amount equal to six (6) months of Employee’s
then current annual base salary.
(ii) all of the shares subject to Employee’s then outstanding and unvested stock options or
other equity grants granted by the Company to Employee prior to such termination shall become fully
vested and, to the extent applicable with respect to the stock option or equity award, exercisable
(and to the extent any such equity grants are restricted stock units, then such units shall be
settled within the time period set forth in the paragraph below regarding payment of cash severance
benefits).
(b) Existing Single-Trigger Vesting Acceleration. This Agreement does not amend,
supersede or modify any outstanding vesting acceleration that may occur upon a change of control of
the Company (i.e., “single-trigger vesting acceleration”) as may be set forth in existing equity
grants held by Employee or any future equity grants that may be granted to Employee and any such
acceleration remains in full force and effect with respect to such equity awards.
The severance payments and benefits payable pursuant to Section 4(a) above are not cumulative.
Subject to the provisions of Section 5, cash severance benefits payable pursuant to this
Section 4 shall be payable on the sixty-first (61st) day following the Termination
Without Cause, provided the Release is effective at such time.
(c) No Duplication of Severance and Acceleration Benefits. If Employee is eligible
for severance and acceleration benefits as set forth in this Section 4, then the receipt of such
severance and benefits shall be the sole entitlement to severance and acceleration benefits and
Employee is not eligible to receive severance and acceleration benefits under any policies and
plans of the Company or other agreements between the Company and Employee.
(d) Accrued Wages and Vacation; Expenses. Without regard to the reason for, or the
timing of, Employee’s termination of employment: (i) the Company shall pay Employee any unpaid base
salary due for periods prior to the Termination Date; (ii) the Company shall pay Employee all of
Employee’s accrued and unused vacation through the Termination Date; and (iii) following submission
of proper written expense reports by Employee, the Company shall reimburse Employee for all
expenses reasonably and necessarily incurred by Employee in connection with the business of the
Company prior to the Termination Date in accordance with the Company’s expense reimbursement
policy. These payments shall be made promptly upon termination and within the period of time
mandated by law.
5. Six Month Hold-Back and Separation from Service. To the extent (a) any payments or
benefits to which Employee becomes entitled under this Agreement, or under any agreement or plan
referenced herein, in connection with Employee’s termination of employment with the Company
constitute deferred compensation subject to Section 409A of the Code and (b) Employee is deemed at
the time of such termination of employment to be a “specified employee” under Section 409A of the
Code, then such payments shall not be made or commence until the earliest of (i) the expiration of
the six (6)-month period measured from the date of Employee’s “separation from service” (as such
term is at the time defined in Treasury Regulations under Section 409A of the Code) from the
Company; or (ii) the date of Employee’s death following such separation from service; provided,
however, that such deferral shall only be effected to the extent required to avoid adverse tax
treatment to Employee, including (without limitation) the additional twenty percent (20%) tax for
which Employee would otherwise be liable under
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Section 409A(a)(1)(B) of the Code in the absence of such deferral. Upon the expiration of the
applicable deferral period, any payments which would have otherwise been made during that period
(whether in a single sum or in installments) in the absence of this paragraph shall be paid to
Employee or Employee’s beneficiary in one lump sum (without interest). Any termination of
Employee’s employment is intended to constitute a “separation from service” as such term is defined
in Treasury Regulation Section 1.409A-1. It is intended that each installment of the payments
provided hereunder constitute separate “payments” for purposes of Treasury Regulation Section
1.409A-2(b)(2)(i). It is further intended that payments hereunder satisfy, to the greatest extent
possible, the exemption from the application of Code Section 409A (and any state law of similar
effect) provided under Treasury Regulation Section 1.409A-1(b)(4) (as a “short-term deferral”).
6. Limitation on Payments Under Code Section 280G. In the event that the severance
and other benefits provided for in this Agreement or otherwise payable to Employee (a) constitute
“parachute payments” within the meaning of Section 280G of the Code and (b) but for this Section,
would be subject to the excise tax imposed by Section 4999 of the Code, then, at Employee’s
discretion, Employee’s severance and other benefits under this Agreement shall be payable either
(i) in full, or (ii) as to such lesser amount which would result in no portion of such severance
and other benefits being subject to the excise tax under Section 4999 of the Code, whichever of the
foregoing amounts (after taking into account the applicable federal, state and local income taxes
and the excise tax imposed by Section 4999), results in the receipt by Employee on an after-tax
basis, of the greatest amount of severance benefits under this Agreement, notwithstanding that all
or some portion of such severance benefits may be taxable under Section 4999 of the Code. Any
such reduction shall reduce cash payments first followed by reductions in equity compensation
benefits. Unless the Company and Employee otherwise agree in writing, any determination required
under this Section shall be made in writing by the Company’s independent public accountants (the
“Accountants”), whose determination shall be conclusive and binding upon Employee and the Company
for all purposes. For purposes of making the calculations required by this Section, the
Accountants may make reasonable assumptions and approximations concerning applicable taxes and may
rely on reasonable, good faith interpretations concerning the application of Sections 280G and 4999
of the Code. The Company and Employee shall furnish to the Accountants such information and
documents as the Accountants may reasonably request in order to make a determination under this
Section. The Company shall bear all costs the Accountants may reasonably incur in connection with
any calculations contemplated by this Section.
7. Successors.
(a) Company’s Successors. Any successor to the Company (whether direct or indirect
and whether by purchase, lease, merger, consolidation, liquidation or otherwise, including, without
limitation, pursuant to a Change of Control) or any purchaser of all or substantially all of the
Company’s business and/or assets shall assume the Company’s obligations under this Agreement and
agree expressly to perform the Company’s obligations under this Agreement in the same manner and to
the same extent as the Company would be required to perform such obligations in the absence of a
succession, unless otherwise agreed upon in writing by Employee and such successor. For all
purposes under this Agreement, the term “Company” shall include any successor to the Company’s
business and/or assets.
(b) Employee’s Successors. Without the written consent of the Company, Employee shall
not assign or transfer this Agreement or any right or obligation under this Agreement to any other
person or entity. Notwithstanding the foregoing, the terms of this Agreement and all rights of
Employee hereunder shall inure to the benefit of, and be enforceable by, Employee’s personal or
legal representatives, executors, administrators, successors, heirs, distributees, devisees and
legatees.
8. Notices. Notices and all other communications contemplated by this Agreement shall
be in writing and shall be deemed to have been duly given when personally delivered or when mailed
by U.S. registered or certified mail, return receipt requested and postage prepaid. In the case of
Employee,
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mailed notices shall be addressed to Employee at the home address which Employee most recently
communicated to the Company in writing. In the case of the Company, mailed notices shall be
addressed to its corporate headquarters, and all notices shall be directed to the attention of its
Chief Executive Officer.
9. Arbitration. The parties agree that any controversy or claim arising out of or
relating to this Agreement, or the breach thereof, shall be submitted to the American Arbitration
Association (“AAA”) and that a neutral arbitrator will be selected in a manner consistent with its
National Rules for the Resolution of Employment Disputes. The arbitration proceedings will allow
for discovery according to the rules set forth in the National Rules for the Resolution of
Employment Disputes. All arbitration proceedings shall be conducted in Los Angeles County,
California.
10. Miscellaneous Provisions.
(a) No Duty to Mitigate. Employee shall not be required to mitigate the amount of any
payment contemplated by this Agreement, nor shall any such payment be reduced by any earnings that
Employee may receive from any other source.
(b) Waiver. No provision of this Agreement may be modified, waived or discharged
unless the modification, waiver or discharge is agreed to in writing and signed by Employee and by
an authorized officer of the Company (other than Employee). No waiver by either party of any
breach of, or of compliance with, any condition or provision of this Agreement by the other party
shall be considered a waiver of any other condition or provision or of the same condition or
provision at another time.
(c) Integration. Except with respect to the vesting acceleration described in Section
4(b), this Agreement represents the entire agreement and understanding between the parties as to
the subject matter herein regarding severance and acceleration benefits and supersede all prior or
contemporaneous agreements, whether written or oral, with respect to this Agreement, including but
not limited to any offer of employment from the Company to Employee.
(d) Choice of Law. The validity, interpretation, construction and performance of this
Agreement shall be governed by the internal substantive laws, but not the conflicts of law rules,
of the State of California.
(e) Severability. The invalidity or unenforceability of any provision or provisions
of this Agreement shall not affect the validity or enforceability of any other provision hereof,
which shall remain in full force and effect.
(f) Employment Taxes. All payments made pursuant to this Agreement shall be subject
to withholding of applicable income and employment taxes.
(g) Counterparts. This Agreement may be executed in counterparts, each of which shall
be deemed an original, but all of which together will constitute one and the same instrument.
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, each of the parties has executed this Executive Severance
Agreement, in the case of the Company by its duly authorized officer, as of the day and year first
above written.
| COMPANY: | Green Dot Corporation |
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| By: | ||||
| Title: | ||||
| EMPLOYEE: | ||||
| Signature | ||||
[Signature Page to Green Dot Corporation Executive Severance Agreement]
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