Exhibit 10.2

EMPLOYMENT SEVERANCE AGREEMENT

This Employment Severance Agreement (the “Agreement”) is made and entered into
effective as of February 1, 2016 (the “Effective Date”), by and between Brian B.
Hansen (the “Employee”) and Tandem Diabetes Care, Inc. (the “Company”).

R E C I T A L S

A. The Company and the Employee have entered into that employment letter
agreement dated January 12, 2016, and that Employee Proprietary Information
Agreement dated January 19, 2016 (the “Existing Agreements”).

B. The Board of Directors of the Company (the “Board”) believes the Company
should provide the Employee with certain severance benefits should the
Employee’s employment with the Company terminate under certain circumstances,
such benefits to provide the Employee with enhanced financial security and
sufficient incentive and encouragement to remain with the Company.

C. Certain capitalized terms used in the Agreement are defined in Section 4
below.

AGREEMENT

In consideration of the mutual covenants herein contained, and in consideration
of the continuing employment of the Employee by the Company, the parties agree
as follows:

1. At-Will Employment. The Company and the Employee acknowledge that the
Employee’s employment is and shall continue to be at-will, as defined under
applicable law. If the Employee’s employment terminates for any reason, the
Employee shall not be entitled to any payments, benefits, damages, awards or
compensation other than as provided by this Agreement, or as may otherwise be
available in accordance with the Company’s established employee plans and
practices or in accordance with other agreements between the Company and the
Employee.

2. Severance and Change of Control Benefits.

(a) Benefits upon Termination in Connection with a Change of Control. If, on or
within three (3) months prior to a Change of Control or within twelve
(12) months after a Change of Control, the Employee’s employment terminates as a
result of an Involuntary Termination or a Resignation For Good Reason and the
Employee signs, complies with and does not revoke a Release of Claims, then the
Employee shall receive the following severance benefits:

(i) the Employee will receive during the eighteen (18) month period immediately
following the date of the Involuntary Termination or the Resignation For Good
Reason (if such termination or resignation occurred after the Change of Control)
or on the date of the Change of Control (if such termination or resignation
occurred on or before the Change of Control), as applicable (the “Severance
Period”), a guarantee of salary continuation equal to the Employee’s monthly
portion of Base Compensation on the date of termination, less applicable
withholdings and deductions;

 

(ii) (A) the Employee will vest in and have the right to exercise all of the
Employee’s outstanding options, restricted stock units and stock appreciation
rights that were otherwise

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Exhibit 10.2

unvested as of the date of such Involuntary Termination or Resignation For Good
Reason, (B) all of the Company’s rights to repurchase vested and unvested
restricted stock or restricted stock units from the Employee shall lapse as to
that number of shares in which such repurchase rights have yet to lapse and
(C) any right of the Company to repurchase any common stock of the Company shall
terminate including under any right of first refusal.

(b) Voluntary Resignation; Termination for Cause. If the Employee’s employment
with the Company terminates other than as a result of an Involuntary Termination
or Resignation For Good Reason, then the Employee will not be entitled to
receive severance change in control benefits as defined in this Section 2 or
other severance or benefits except for those (if any) as may then be established
under the Company’s then existing severance and benefits plans and practices or
pursuant to other written agreements with the Company.

(c) Disability; Death. If the Company terminates the Employee’s employment as a
result of the Employee’s Disability, or the Employee’s employment terminates due
to the Employee’s death, then the Employee will not be entitled to receive
severance or other benefits except for those (if any) as may then be established
under the Company’s then existing written severance and benefits plans and
practices or pursuant to other written agreements with the Company.

(d) Miscellaneous. Upon the termination of the Employee’s employment for any
reason, (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 paid time off 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
upon termination and within the period of time mandated by applicable law.

 

3. Limitations on Payments.

(a) Code Section 409A.

(i) Notwithstanding anything to the contrary in this Agreement, if the Employee
is a “specified employee” within the meaning of Section 409A at the time of the
Employee’s termination (other than due to death), then the severance payable to
the Employee, if any, pursuant to this Agreement, together with any other
severance payments or separation benefits that are considered deferred
compensation under Section 409A (together, the “Deferred Compensation Separation
Benefits”), that are payable within the first six (6) months following the
Employee’s termination of employment will become payable on the first payroll
date that occurs on or after the date six (6) months and one (1) day following
the date of the Employee’s termination of employment. All subsequent Deferred
Compensation Separation Benefits, if any, will be payable in accordance with the
payment schedule applicable to each payment or benefit. Notwithstanding anything
herein to the contrary, if the Employee dies following the Employee’s
termination but prior to the six (6) month anniversary of the Employee’s
termination, then any payments delayed in accordance with this paragraph will be
payable in a lump sum as soon as administratively practicable after the date of
the Employee’s death and all other Deferred Compensation Separation Benefits
will be payable in accordance with the payment schedule applicable to each
payment or benefit. Each payment and benefit payable under this Agreement is
intended to constitute separate payments for purposes of Section 1.409A-2(b)(2)
of the Treasury Regulations.

(ii) Any amount paid under this Agreement that satisfies the requirements of the
“short-term deferral” rule set forth in Section 1.409A-1(b)(4) of the Treasury
Regulations shall not constitute Deferred Compensation Separation Benefits for
purposes of clause (i) above.

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Exhibit 10.2

(iii) Any amount paid under this Agreement that qualifies as a payment made as a
result of an involuntary separation from service pursuant to
Section 1.409A-1(b)(9)(iii) of the Treasury Regulations that do not exceed the
Section 409A Limit shall not constitute Deferred Compensation Separation
Benefits for purposes of clause (i) above. For purposes of this Agreement,
“Section 409A Limit” shall mean the lesser of two (2) times: (i) the Employee’s
annualized compensation based upon the annual rate of pay paid to the Employee
during the Company’s taxable year preceding the Company’s taxable year of the
Employee’s termination of employment as determined under Treasury Regulation
1.409A-1(b)(9)(iii)(A)(1) and any Internal Revenue Service guidance issued with
respect thereto; or (ii) the maximum amount that may be taken into account under
a qualified plan pursuant to Section 401(a)(17) of the Code for the year in
which the Employee’s employment is terminated.

(iv) The foregoing provisions are intended to comply with the requirements of
Section 409A so that none of the severance payments and benefits to be provided
hereunder will be subject to the additional tax imposed under Section 409A, and
any ambiguities herein will be interpreted to so comply. The Company and the
Employee agree to work together in good faith to consider amendments to this
Agreement and to take such reasonable actions which are necessary, appropriate
or desirable to avoid imposition of any additional tax or income recognition
prior to actual payment to the Employee under Section 409A.

 

(b) 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) but for this Section 3(b), would be subject to the excise tax
imposed by Section 4999 of the Code, then the Employee’s benefits under
Section 2 of this Agreement shall be either:

(i) delivered in full, or

(ii) delivered as to such lesser extent which would result in no portion of such
severance and other benefits being subject to excise tax under Section 4999 of
the Code, whichever of the foregoing amounts, taking into account the applicable
federal, state and local income taxes and the excise tax imposed by Section 4999
of the Code, results in the receipt by the Employee on an after-tax basis, of
the greatest amount of severance benefits, notwithstanding that all or some
portion of such severance 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 3(b) shall be made in writing by the
Company’s independent public accountants immediately prior to the Change of
Control (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 3(b), 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 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 3(b). The Company
shall bear all costs the Accountants may reasonably incur in connection with any
calculations contemplated by this Section 3(b).

4. Definition of Terms. The following terms referred to in this Agreement shall
have the following meanings:

(a) Base Compensation. “Base Compensation” means the Employee’s (i) annual base
salary paid by the Company for services performed as in effect on the
Termination Date; and (ii) target cash bonus and/or other forms of cash
incentive compensation for the fiscal year in which the Change of Control is
effective.

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Exhibit 10.2

(b) Cause. “Cause” means:

(i) the Employee’s continued intentional and demonstrable failure to perform his
or her duties customarily associated with the Employee’s position as an employee
of the Company or its respective successors or assigns, as applicable (other
than any such failure resulting from the Employee’s mental or physical
Disability) after the Employee has received a written demand of performance from
the Company which specifically sets forth the factual basis for the Company’s
belief that the Employee has not devoted sufficient time and effort to the
performance of his or her duties and has failed to cure such non-performance
within thirty (30) days after receiving such notice (it being understood that if
the Employee is in good faith performing his or her duties, but is not achieving
results the Company deems satisfactory for the Employee’s position, it will not
be considered to be grounds for termination of the Employee for “Cause”);

(ii) the Employee’s conviction of, or plea of nolo contendere to, a felony that
the Board reasonably believes has had or will have a material detrimental effect
on the Company’s reputation or business;

(iii) the Employee’s commission of an act of fraud, embezzlement,
misappropriation, willful misconduct, or breach of fiduciary duty against, and
causing material harm to, the Company or its respective successors or assigns,
as applicable;

(iv) the Employee’s unauthorized use of the Company’s material confidential
information; or

(v) the Employee’s prohibited or unauthorized competitive activity.

The Employee will receive notice and an opportunity to be heard before the Board
with the Employee’s own attorney before any termination for Cause is deemed
effective. Notwithstanding anything to the contrary, the Board may immediately
place the Employee on administrative leave (with full pay and benefits to the
extent legally permissible) but will allow reasonable access to Company
information, employees and business should the Employee wish to avail himself
and prepare for his or her opportunity to be heard before the Board prior to the
Board’s termination for Cause. If the Employee avails himself or herself of the
Employee’s opportunity to be heard before the Board, and then fails to make
himself or herself available to the Board within thirty (30) days of such
request to be heard, the Board may thereafter cancel the administrative leave
and terminate the Employee for Cause. Likewise, if the Board fails to make
itself available to the Employee and his or her counsel within thirty (30) days
of the Employee’s request to be heard, Employee will be entitled to terminate
his or her employment with the Company and such termination will be treated as a
resignation by Employee for Involuntary Termination.

(c) Change of Control. “Change of Control” means (A) the acquisition of the
Company by another entity by means of any transaction or series of related
transactions (including, without limitation, any merger, consolidation or other
form of reorganization in which outstanding shares of the Company are exchanged
for securities or other consideration issued, or caused to be issued, by the
acquiring entity or its subsidiary, but excluding any transaction effected
primarily for the purpose of changing the Company’s jurisdiction of
incorporation), unless the Company’s stockholders of record as constituted
immediately prior to such transaction or series of related transactions will,
immediately after such transaction or series of related transactions hold at
least a majority of the voting power of the surviving or acquiring entity,
except that any change in the ownership of the stock of the Company as a result
of a private financing of the Company that is approved by the Board and in which
the Board determines is not a Change of Control for the purposes of this
Agreement will not be considered a Change

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Exhibit 10.2

of Control, or (B) a sale, lease, transfer or other disposition of all or
substantially all of the assets of the Company.

Notwithstanding the foregoing provisions of this definition, a transaction will
not be deemed a Change of Control unless the transaction qualifies as a change
in control event within the meaning of Section 409A.

(d) Disability. “Disability” means the Employee has been unable to perform his
or her Company duties as the result of his or her incapacity due to physical or
mental illness, and such inability, at least twenty-six (26) weeks after its
commencement or 180 days in any consecutive twelve (12) month period, is
determined to be total and permanent by a physician selected by the Company or
its insurers and acceptable to the Employee or the Employee’s legal
representative (such agreement as to acceptability not to be unreasonably
withheld). Termination resulting from Disability may only be effected after at
least thirty (30) days’ written notice by the Company of its intention to
terminate the Employee’s employment. In the event that the Employee resumes the
performance of substantially all of his or her duties hereunder before the
termination of his or her employment becomes effective, the notice of intent to
terminate will automatically be deemed to have been revoked.

(e) Involuntary Termination. “Involuntary Termination” means termination of the
Employee’s employment, without the Employee’s consent, by the Company for any
reason other than Cause.

(f) Release of Claims. “Release of Claims” shall mean a waiver by the Employee,
in a form satisfactory to the Company, of all employment-related obligations of
and claims and causes of action against the Company, and a non-disparagement
agreement by the Employee in a form satisfactory to the Company. Whenever in
this Agreement a payment or benefit is conditioned on Employee’s execution of a
Release of Claims, such Release of Claims must be executed, and all applicable
revocation periods shall have expired, within sixty (60) days after the date of
termination, failing which such payment or benefit shall be forfeited. If such
payment or benefit constitutes non-exempt “deferred compensation” for purposes
of Section 409A of the Code, and if such 60-day period begins in one calendar
year and ends in the next calendar year, the payment or benefit shall not be
made or commence before the second such calendar year, even if the Release of
Claims becomes irrevocable in the first such calendar year.

(g) Resignation for Good Reason. “Resignation for Good Reason” shall mean a
resignation by Employee following a Change of Control and following the
occurrence of one of the following:

(i) a material reduction in the Employee’s Base Compensation;

(ii) any material breach by the Company of any material provision of this
Agreement which continues uncured for thirty (30) days following notice thereof;

 

(iii) a material reduction in the Employee’s duties, responsibilities or
authority; or

(iv) a change of fifty (50) miles or more of the geographic location at which
the Employee must primarily perform services for the Company.

Any purported Resignation for Good Reason pursuant to Section 4(e)(i) through
(e)(iv) above will not be effective until the Employee has delivered to the
Company, within sixty (60) days of the initial existence of the Good Reason
condition, a written explanation that describes the basis for the Employee’s

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Exhibit 10.2

belief that the Employee should be permitted to terminate the Employee’s
employment and have it treated as a Resignation for Good Reason and the Company
has been given thirty (30) days following delivery of such notice to cure any
curable violation. In no instance will a resignation by Employee be deemed to be
a Resignation for Good Reason if it is made more than twelve (12) months
following the initial existence of one or more of the conditions that constitute
Good Reason hereunder.

(h) Termination Date. “Termination Date” shall mean the date on which an event
that would constitute an Involuntary Termination or a Resignation for Good
Reason occurs, or the later of (i) the date on which a notice of termination is
given, or (ii) the date (which shall not be more than thirty (30) days after the
giving of such notice) specified in such notice.

5. 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 obligations under this Agreement and agree expressly to perform
the 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. For all purposes under this Agreement, the term “Company” shall
include any successor to the Company’s business and/or assets which executes and
delivers the assumption agreement pursuant to this subsection (a) or which
becomes bound by the terms of this Agreement by operation of law.

(b) Employee’s Successors. The terms of this Agreement and all rights of the
Employee hereunder shall inure to the benefit of, and be enforceable by, the
Employee’s personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees.

6. Notice.

(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 the Employee at the home address that the 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 or principal human
resources person.

(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 or
Resignation for Good Cause shall be communicated by a notice of termination to
the other party hereto given in accordance with Section 6(a) of this Agreement.
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 or Resignation for Good Cause shall not waive any right
of the Employee hereunder or preclude the Employee from asserting such fact or
circumstance in enforcing the Employee’s rights hereunder.

7. Term and Termination. The term of this Agreement shall be one year from the
Effective Date; provided, however, that this Agreement shall automatically renew
for successive 1-year periods unless either party gives the other party notice,
at least 60 days in advance of the next renewal date, of such party’s intent
that this Agreement terminate effective as of such next renewal date, in which
case the

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Exhibit 10.2

Agreement shall terminate as of such next renewal date; provided further,
however, that in the event a Change of Control that precedes the effective date
of any such termination, the term of this Agreement shall extend at least until
the one (1)-year anniversary of such Change of Control. Notwithstanding the
foregoing, if the Employee becomes entitled to benefits pursuant to Section 2(a)
or 2(b) of this Agreement, this Agreement will not terminate until, but will
terminate at, such time that all of the obligations of the parties hereto with
respect to this Agreement have been satisfied.

8. Miscellaneous Provisions.

(a) No Duty to Mitigate. The Employee shall not be required to mitigate the
amount of any payment contemplated by this Agreement.

(b) Waiver and Amendment. No provision of this Agreement shall be modified,
amended, waived or discharged unless the modification, amendment, waiver or
discharge is agreed to in writing and signed by 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) Whole Agreement. No agreements, representations or understandings (whether
oral or written and whether express or implied) which are not expressly set
forth in this Agreement or in the Existing Agreements have been made or entered
into by either party with respect to the subject matter hereof.

 

(d) Severance Provisions in Other Agreements. The Employee acknowledges and
agrees that the severance provisions set forth in this Agreement shall supersede
any such provisions in any other agreement entered into between the Employee and
the Company.

(e) Choice of Law. The validity, interpretation, construction and performance of
this Agreement shall be governed by the laws of the State of California.

(f) 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.

(g) No Assignment of Benefits. The rights of any person to payments or benefits
under this Agreement shall not be made subject to option or assignment, either
by voluntary or involuntary assignment or by operation of law, including
(without limitation) bankruptcy, garnishment, attachment or other creditor’s
process, and any action in violation of this subsection shall be void.

(h) Withholding. All payments made pursuant to this Agreement will be subject to
withholding of applicable income, employment and other taxes. If the Company
does not make such withholdings on Employee’s behalf, Employee shall pay when
due all such taxes (and any related penalties and interest) imposed on Employee
and shall indemnify the Company for Employee’s failure to do so.

(i) Assignment by Company. The Company may assign its rights under this
Agreement to an affiliate, and an affiliate may assign its rights under this
Agreement to another affiliate of the Company or to the Company; provided,
however, that no assignment shall be made if the net worth of the assignee is
less than the net worth of the Company at the time of assignment. In the case of
any such

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Exhibit 10.2

assignment, the term “Company” when used in a section of this Agreement shall
mean the corporation that actually employs the Employee.

(j) 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.

[Signature Page to Follow]

 

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Exhibit 10.2

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:

 

TANDEM DIABETES CARE, INC.

 

 

 

 

 

 

 

 

By:

 

/s/ Kim D. Blickenstaff 

 

 

 

 

 

 

Kim D. Blickenstaff, Chief Executive Officer

 

 

 

 

 

 

 

 

 

 

EMPLOYEE:

 

By:

 

/s/ Brian B. Hansen 

 

 

 

 

 

 

Brian B. Hansen

 

 

 

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