Exhibit 10.02
GLU MOBILE INC.
CHANGE OF CONTROL SEVERANCE AGREEMENT
     This Change of Control Severance Agreement (the “Agreement”) is made and
entered into effective as of January 31, 2007 (the “Effective Date”), by and
between Jill Braff (the “Employee”) and Glu Mobile Inc. (the “Company”).
RECITALS
     A. It is expected that the Company from time to time will consider the
possibility of a Change of Control (as defined below). The Board of Directors of
the Company (the “Board”) recognizes that such consideration can be a
distraction to the Employee and can cause the Employee to consider alternative
employment opportunities.
     B. The Board believes that it is in the best interests of the Company and
its shareholders to provide the Employee with an incentive to continue his or
her employment and to maximize the value of the Company upon a Change of Control
for the benefit of its shareholders.
     C. In order to provide the Employee with enhanced financial security and
sufficient encouragement to remain with the Company notwithstanding the
possibility of a Change of Control, the Board believes that it is important to
provide the Employee with certain severance benefits upon the Employee’s
termination of employment following a Change of Control.
AGREEMENT
     In consideration of the mutual covenants herein contained and the continued
employment of Employee by the Company, the parties agree as follows:
     1. Definitions. Unless otherwise defined elsewhere herein, the following
terms referred to in this Agreement shall have the following meanings:
          (a) “Cause” means (i) the Employee’s committing of an act of gross
negligence, gross misconduct or dishonesty, or other willful act, including
misappropriation, embezzlement or fraud, that materially adversely affects the
Company or any of the Company’s customers, suppliers or partners, (ii) his or
her personal dishonesty, willful misconduct in the performance of services for
the Company, or breach of fiduciary duty involving personal profit, (iii) his or
her being convicted of, or pleading no contest to, any felony or misdemeanor
involving fraud, breach of trust or misappropriation or any other act that the
Board reasonably believes in good faith has materially adversely affected, or
upon disclosure will materially adversely affect, the Company, including the
Company’s public reputation, (iv) any material breach of any agreement with the
Company by him or her that remains uncured for thirty (30) days after written
notice by the Company to him or her, unless that breach is incapable of cure, or
any other material unauthorized use or disclosure of the Company’s confidential
information or trade secrets involving personal benefit or (v) his or her
failure to follow the lawful directions of the Board or, if he or she is not the
chief executive officer, the lawful directions of the chief executive officer,
in the scope of his or her employment unless he or she reasonably believes in
good faith that these directions are not lawful and notifies the Board or chief
executive officer, as the case may be, of the reasons for his or her belief.
          (b) “Change of Control” means the closing of (i) a merger or
consolidation in one transaction or a series of related transactions, in which
the Company’s securities held by the Company’s shareholders before the merger or
consolidation represent less than fifty percent (50%) of the outstanding

 

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           voting equity securities of the surviving corporation after the
transaction or series of related transactions, (ii) a sale or other transfer of
all or substantially all of the Company’s assets as a going concern, in one
transaction or a series of related transactions, followed by the distribution to
the Company’s shareholders of any proceeds remaining after payment of creditors
or (iii) a transfer of more than 50% of the Company’s outstanding voting equity
securities by the Company’s shareholders to one or more related persons or
entities other than the Company in one transaction or a series of related
transactions:
          (c) “Code” means the United States Internal Revenue Code of 1986, as
amended, and the regulations promulgated thereunder.
          (d) “Involuntary Termination” means the Employee’s resignation of
employment from the Company expressly based on any of the following: (i) without
the Employee’s express written consent, a significant reduction in his or her
duties, position or responsibilities, or his or her removal from these duties,
position and responsibilities, unless he or she is provided with a position of
substantially equal or greater organizational level, duties, authority and
compensation; provided, however, that a change of title, in and of itself, or a
reduction of duties, position or responsibilities solely by virtue of the
Company’s being acquired and made part of a larger entity will not constitute an
“Involuntary Termination,” (ii) a greater than fifteen percent (15%) reduction
in his or her then-current annual base compensation that is not applicable to
the Company’s other executive officers, or (iii) without his or her express
written consent, a relocation to a facility or a location more than thirty
(30) miles from his or her then-current location of employment. For the
avoidance of doubt, Involuntary Termination shall not include a termination of
employment for death or Permanent Disability. Notwithstanding the foregoing in
this subsection (d), the Company shall have thirty (30) days to cure any
purported termination upon receiving written notice from the Employee pursuant
to Section 8(b) hereof.
          (e) “Permanent Disability” has the meaning set forth in Section 22(e)
of the Code.
          (f) “Termination Date” shall mean the effective date of any notice of
termination delivered by one party to the other hereunder.
     2. Term of Agreement. This Agreement shall terminate upon the date that all
obligations of the parties hereto under this Agreement have been satisfied or,
if earlier, on the date, prior to a Change of Control, Employee is no longer
employed by the Company.
     3. At-Will Employment. The Company and the Employee acknowledge that the
Employee’s employment is, and shall continue to be, at-will.
     4. Severance Benefits.
          (a) Termination Following a Change of Control. If the Employee’s
employment with the Company is terminated without Cause or is terminated as a
result of an Involuntary Termination at any time within twelve (12) months after
a Change of Control, Employee shall, after the execution and non-revocation (to
the extent permitted by applicable law) of a release of claims in favor of the
Company (the release of which shall not include any release of claims pursuant
to which the Employee is entitled to indemnification with respect to thereof)
(the “Release”), be entitled to the following severance benefits (which shall be
payable as soon as is administratively practicable following the expiration of
any revocation period applicable to the Release, and subject to the time
limitations set forth in Section 5):
               (i) six (6) months of the Employee’s then-current annual base
salary, payable in a lump sum.

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               (ii) Employee’s bonus actually earned, based on actual completion
of the applicable performance targets for the year, quarter or other period (as
applicable) in which the Involuntary Termination occurs, prorated for the number
of days of the Employee’s service to the Company for such year, quarter or other
period (as applicable), payable in a lump sum; provided that all individual
performance objectives will be deemed fully achieved.
               (iii) in addition to the shares that are vested and exercisable
in accordance with each equity grant that was granted by the Company to the
Employee prior to the Termination Date, each such grant shall become vested and
exercisable as to an additional fifty percent (50%) of the shares originally
subject to each such outstanding and not fully vested equity grant;
               (iv) Until the earlier of (i) the date Employee is no longer
eligible to receive continuation coverage pursuant to COBRA, or (ii) six
(6) months from the Termination Date, the Company shall reimburse Employee for
continuation coverage pursuant to COBRA (as defined below) as was in effect for
the Employee (and any eligible dependents) on the day immediately preceding the
Termination Date; provided, however, that (i) the Employee constitutes a
qualified beneficiary, as defined in Section 4980B(g)(l) of the Code; and
(ii) the Employee timely elects continuation coverage pursuant to the
Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”).
          (b) Termination Apart from a Change of Control. If the Employee’s
employment with the Company terminates for any reason (including a termination
without Cause or due to an Involuntary Termination) at any time following twelve
(12) months after a Change of Control, then the Employee shall not be entitled
to receive any acceleration, severance or other benefits pursuant to this
Agreement, but may be eligible for those benefits (if any) as may then be
established under the Company’s then-existing severance and benefits plans and
policies at the time of such termination.
          (c) 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 the Employee any unpaid base salary due for periods prior to the
Termination Date; (ii) the Company shall pay the Employee all of the Employee’s
accrued and unused vacation through the Termination Date and (iii) following
submission of proper expense reports by the Employee, the Company shall
reimburse the Employee for all expenses reasonably and necessarily incurred by
the Employee in connection with the business of the Company prior to the
Termination Date. These payments shall be made promptly and within the period of
time mandated by law.
     5. Six Month Hold-Back. To the extent (i) any payments or benefits to which
Employee becomes entitled under this Agreement, or 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 (ii) the 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 (A) 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; (B) the date the Employee becomes
“disabled” (as defined in Section 409A of the Code); or (C) the date of the
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 the Employee, including (without limitation) the additional twenty
percent (20%) tax for which the Employee would otherwise be liable under
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 the Employee or
the Employee’s beneficiary in one lump sum (without interest).

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     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 the Employee (i) constitute “parachute payments” within the meaning of
Section 280G of the Code, and (ii) would be subject to the excise tax imposed by
Section 4999 of the Code (the “Excise Tax”), then Employee’s benefits under this
Agreement shall be either:
          (a) delivered in full; or
          (b) delivered as to such lesser extent that would result in no portion
of such benefits being subject to the Excise Tax,
     whichever of the foregoing amounts, taking into account the applicable
federal, state and local income taxes and the Excise Tax, results in the receipt
by Employee on an after-tax basis, of the greatest amount of benefits,
notwithstanding that all or some portion of such benefits may be taxable under
Section 4999 of the Code.
     Unless the Company and the 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 the 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 Section 280G and 4999 of the Code.
The Company and the 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) to 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 the 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.
          (a) General. 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 the Employee, mailed
notices shall be addressed to him or her at the home address which he or she
most recently communicated to the Company in writing. In the case of the
Company, mailed notices shall be

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addressed to its corporate headquarters, and all notices shall be directed to
the attention of its General Counsel.
          (b) Notice of Termination. Any termination by the Company for Cause or
by the Employee as a result of a voluntary resignation or an Involuntary
Termination shall be communicated by a notice of termination to the other party
hereto given in accordance with this Section. Such notice shall indicate the
specific termination provision in this Agreement relied upon, shall set forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination under the provision so indicated, and shall specify the Termination
Date (which shall be not more than thirty (30) days after the giving of such
notice). The failure by the Employee to include in the notice any fact or
circumstance which contributes to a showing of Involuntary Termination shall not
waive any right of the Employee hereunder or preclude the Employee from
asserting such fact or circumstance in enforcing Employee’s rights hereunder.
     9. Arbitration. The parties agree that any controversy or claim arising out
of, or relating to, this Agreement, or the breach hereof, shall be submitted to
the American Arbitration Association (“AAA”) and that a neutral arbitrator will
be selected in a manner consistent with the AAA’s National Rules for the
Resolution of Employment Disputes (the “Rules”). The arbitration proceedings
will allow for discovery according to the Rules. All arbitration proceedings
shall be conducted in Santa Clara County, California.
     10. Miscellaneous Provisions.
          (a) No Duty to Mitigate. The 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 the 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 both the Employee and by an authorized officer of the Company
(other than the 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. This Agreement and any outstanding equity agreements
referenced herein represent 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.
          (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.

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IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case
of the Company by its duly authorized officer, as of the day and year first
above written.

              COMPANY:   GLU MOBILE INC.    
 
           
 
  By:        
 
     
 
   
 
           
 
  Title:        
 
     
 
   
 
           
EMPLOYEE:
           
 
                          Signature    
 
                          Printed Name    

[Signature Page to Change of Control Severance Agreement]

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