Exhibit 10.31


 


Amended and Restated NetSpend Holdings, Inc.


2004 Stock Option and Restricted Stock Plan

Notice of Grant


 


Name:                                                                 
  Address:      


 


You have been granted an
option to purchase Common Stock
of NetSpend Holdings, Inc. (the “Company”), subject to the terms and
conditions of the Stock Option Agreement attached hereto (the “Stock Option
Agreement”) and the Amended and Restated NetSpend Holdings, Inc. 2004
Stock Option and Restricted Stock Plan (the “Plan”), as follows:


 


	
  Date of Grant:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Vesting Measurement Date:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Option Price per Share:

  	
   

  	
  $

  
	
   

  	
   

  	
   

  
	
  Total Number of Shares
  Granted:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Total Option Price:

  	
   

  	
  $

  
	
   

  	
   

  	
   

  
	
  Type of Option:

  	
   

  	
       Incentive
  Stock Option       Nonqualified Stock Option

  
	
   

  	
   

  	
   

  
	
  Expiration Date:

  	
   

  	
   

  



 


Capitalized terms not
defined herein shall have the meanings ascribed to such terms in the Plan or
the Stock Option Agreement.


 


Vesting and Exercise
Schedule:


 


1.  Dual Vesting Conditions.


 


(a)                                 Except as set
forth in subsection (e) below, this Option shall become vested subject to two
conditions, a performance-based vesting condition and, to the extent the
performance-based vesting condition is met, a time-based vesting condition,
each as described herein.


 


(b)                                 Subject to the
time vesting condition set forth in subsection (c) below, 100% of the
Option shall become eligible
for vesting on the date the Company achieves a Performance Condition (as
defined in Section 2 below).


 


(c)                                  If you have
remained continuously employed through the date the Company achieves a
Performance Condition (defined in Section 2), the Option shall vest in
four equal annual installments, beginning on the first anniversary of the
Vesting Measurement Date, subject to your continued service or employment
through the applicable vesting date. 
Notwithstanding the foregoing, in
the event that prior to or in connection with a Change in Control (excluding
any Change in Control that also constitutes an Initial Public Offering), the
Company has achieved or achieves, as applicable, a Performance
Condition: (1) if the Option is
not being assumed by, or substituted for new options (“New Options”) covering
the stock of the surviving, successor or 


 

















 


purchasing
corporation, or a parent or subsidiary thereof, 100% of the Option shall vest
upon the consummation of the Change in Control, and (2) if, during the
twelve-month period following such Change in Control, a Termination of Service
occurs as a result of a termination of your employment by the Company or any
Affiliate for any reason other than (A) for Cause or (B) Disability, 100% of the assumed Option or
New Options, as applicable, shall vest immediately.  For clarification, in the event of your
termination of employment by the Company for Cause, due to your resignation, or
as result of your Disability or death, the assumed Option or new Options will
not vest pursuant to this subsection (c).


 


(d)                                 Example.  The following is an example (and assumes that
no Change in Control occurs):  If the
Company achieves the Equity Value Target 13 months following the Vesting
Measurement Date in connection with an Initial Public Offering, 25% of the
Option will vest on the date the Company achieves the Equity Value Target and
the remainder of the Option will vest in three equal annual installments on the
next three anniversaries of the Vesting Measurement Date, subject to your
continued service or employment with the Company or an Affiliate through the
applicable vesting date.  If the Company achieves
the Equity Value Target five years following the Vesting Measurement Date, 100%
of the Option will vest on the date the Company achieves the Equity Value
Target so long as you have remained employed with the Company or an Affiliate
through the date the Company achieves the Equity Value Target.


 


(e)                                  In the event a Change in Control has not occurred on or prior to the
sixth anniversary of the Vesting Measurement Date, 100% of the Option, to the
extent not previously vested or terminated, shall vest on the sixth anniversary
of the Vesting Measurement Date so long as you have remained continuously
employed with the Company or an Affiliate through such date.


 


2.                                      Performance-Based
Vesting Condition.


 


(a)                                 The
performance-based vesting condition described in Section 1 shall be
achieved if any of the events described below (each, a “Performance Condition”)
occurs:


 


(i)                                     a Change in
Control occurs on or prior to December 31, 2011, in which case, the
Performance Condition shall be achieved as of the date of the Change in
Control; or


 


(ii)                                  a Change in Control
occurs after December 31, 2011, and the Equity Value Target is achieved in
connection with the Change in Control, in which case, the Performance Condition
shall be achieved as of the date of the Change in Control; or


 


(iii)                               an Initial
Public Offering occurs and the Equity Value Target is achieved following the
Initial Public Offering, in which case, the Performance Condition shall be
achieved as of the date the Equity Value Target is achieved; or


 


(iv)                              the EBITDA
Hurdle is achieved at any time, in which case, the Performance Condition shall
be achieved as of the fifteenth (15th) day of the third month of the fiscal year
following the fiscal year with respect to which the EBITDA Hurdle is achieved.


 


(b)                                 Equity Value
Target.  The Company shall have achieved
the “Equity Value Target” on the date that the Company’s Equity Value equals or
exceeds for the first time the Equity Value Hurdle (each as defined
below).  Determination of whether the
Equity Value Hurdle 


 


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has been achieved shall be
made only (i) in connection with a Change in Control of the Company and/or
(ii) upon or at any time, and from time to time, following an Initial
Public Offering (as defined below), all as provided below.  The initial “Equity Value Hurdle” (measured
as of April 1, 2010) is $1,383,784,330 and shall be increased from time to
time as follows (without duplication):


 


(i)                                     in the event that the
Company raises additional capital from the sale of equity by the Company, the
proceeds of which are used to fund acquisitions by the Company or any
subsidiary thereof, based on the following formula:


 


a.              I =
(EVH/(1-N/FD))-EVH, where


 


i.            I is the amount
of the increase in each Equity Value Hurdle,


 


ii.         EVH is the Equity Value Hurdle in effect immediately
prior to such issuance,


 


iii.      N is the number of common stock equivalents of the
Company issued in connection with such sale of equity, and


 


iv.     FD is the fully diluted number of common stock
equivalents of the Company outstanding after giving effect to such issuance.


 


(ii)                                  in the event
that the Company issues securities of the Company in connection with any
acquisition by the Company or any subsidiary thereof (whether by way of merger,
acquisition or similar transaction), joint venture, corporate partnering
arrangement or similar arrangement, based on the following formula:


 


a.             I = (EVH/(1-N/FD))-EVH,
where


 


i.            I is the amount
of the increase in each Equity Value Hurdle,


 


ii.         EVH is the
Equity Value Hurdle in effect immediately prior to such issuance,


 


iii.      N is the number of common
stock equivalents of the Company issued in connection with such acquisition,
joint venture, corporate partnering arrangement or similar arrangement, and


 


iv.     FD is the fully diluted
number of common stock equivalents of the Company outstanding after giving
effect to such issuance.


 


(iii)                               by the
aggregate value of other consideration (including assumed indebtedness) paid by
the Company or any subsidiary thereof (as determined in good faith by the
Board) in connection with any such acquisition, transaction or arrangement by
the Company or any subsidiary thereof.


 


The Company shall promptly
determine the amount of any such increase in the Equity Value Hurdle and shall
provide written notice to you of any such increase in the Equity Value Hurdle.


 


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(c)                                  EBITDA Hurdle.  The EBITDA Hurdle is $85 million for the
fiscal year ending December 31, 2011. 
The EBITDA Hurdle for any subsequent fiscal year is $85 million plus a
cumulative increase of 10% per year, compounding annually (e.g., $93,500,000
for the fiscal year ending December 31, 2012, and $102,850,000 for the
fiscal year ending December 31, 2013). 
The EBITDA Hurdle shall be deemed to have been achieved thirty (30) days
following the completion of the Company’s audited financial statements for the
applicable year.


 


3.                                      Clarification
Regarding Option Vesting and Forfeiture.  If a Change in Control occurs prior to the
sixth anniversary of the Vesting Measurement Date, and no Performance Condition
has been achieved as of or prior to the Change in Control, the Option shall not be exercisable and shall terminate
as of the consummation of such Change in Control without any payment
therefor.  Prior to an Initial Public
Offering, the Option will only be eligible to vest upon a Change in Control
(based on the Equity Value as of the Change in Control or the achievement of
the EBITDA Hurdle prior to the Change in Control) or upon the sixth anniversary
of the Vesting Measurement Date.


 


4.                                      Additional
Definitions:  For purposes of this Notice of Grant,
the Stock Option Agreement and the Plan:


 


(a)                                 “Initial
Public Offering” or “IPO” means the first firm commitment underwritten
public offering for shares of Common Stock pursuant to an effective
registration statement under the Securities Act with aggregate gross proceeds
of at least $40,000,000.


 


(b)                                 “EBITDA”  for any period
shall mean the sum of the Company’s consolidated net earnings (or loss) before
interest expense, income taxes, depreciation and amortization for said period
as determined by the Board in accordance with generally accepted accounting
principles applied on a consistent basis; provided, that the Board (1) shall
adjust EBITDA to neutralize the impact of the compensation charge for equity
compensation and (2) retains the discretion to adjust EBITDA up or down to
reflect restructurings, extraordinary or non-recurring items, discontinued
operations and cumulative effects of accounting changes.  For the avoidance of
doubt, EBITDA is determined by the Board in its sole discretion.


 


(c)                                  “Equity Value” means, with respect to a determination made in
connection with a Change in Control, the aggregate value of the fully-diluted
equity of the Company, as determined in good faith by the Board based on the
proceeds received in connection with a Change in Control.  With respect to a determination made upon or
at any time, and from time to time, following the date of an IPO and not made
in connection with a Change in Control, a particular Equity Value Hurdle shall
be deemed to be achieved only upon the aggregate market capitalization of the
Common Stock being equal to or greater than the applicable Equity Value Hurdle
for thirty consecutive trading days.  For
purposes of the foregoing, the market capitalization of the Common Stock shall
be determined by multiplying the average of the closing sale prices (without
regard to after-hours trading) of the Common Stock on the applicable securities
exchange for the applicable 30 consecutive trading days by the weighted average
number of shares of the Common Stock outstanding during such 30-day trading
period.


 


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Termination Period:


 


This Option (to the extent
vested) may be exercised for the period set forth in Section 4 of the
Stock Option Agreement which generally provides the following:  (1)  the Option may be exercised for 90
days after any termination of employment, or for such longer period as may be
applicable upon death or Disability, but in no event later than the Expiration
Date (as provided above) and (2) the Option may not be exercised (A) after
the termination of your employment by the Company or an Affiliate for Cause (as
defined in the Plan), (B) after a breach by you of any confidentiality, non-solicitation
or non-competition agreement between you and the Company or any of its
Affiliates, or (C) after you engage in any Detrimental Activity.


 


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Amended and Restated NetSpend Holdings, Inc.


2004 Stock Option Plan


 


Stock Option Agreement


 


This Stock Option Agreement
(this “Agreement”) is made as of the      day of
                          ,
200 , between NetSpend Holdings, Inc., a Delaware corporation (the “Company”),
and
                                                            
(the “Participant”, which term as used herein shall be deemed to include any
successor to the Participant by will or by the laws of descent and
distribution, unless the context shall otherwise require).


 


Pursuant to the Company’s
Amended and Restated 2004 Stock Option Plan (the “Plan”), the Company, acting
through the Committee, approved the issuance to the Participant, effective as
of the date set forth above, of a stock option to purchase the number of shares
(the “Shares”) of Common Stock,
$0.001 par value per share, of the Company (the “Option  Stock”), at the price (the “Option Price”),
each as set forth in the Notice of Grant attached hereto (the “Notice of Grant”),
upon the terms and conditions hereinafter set forth.  Capitalized terms not defined herein shall
have the meanings ascribed to such terms in the Plan or in the Notice of Grant.


 


NOW,
THEREFORE, in consideration of the mutual premises and
undertakings hereinafter set forth, the parties hereto agree as follows:


 


1.                                      Option; Option Price.


 


On behalf of the Company,
the Committee hereby grants to the Participant an option (the “Option”) to
purchase the number of shares of Option Stock of the Company set forth in the
Notice of Grant, at an exercise price per share equal to the Option Price set
forth in the Notice of Grant, subject to the terms and conditions of this
Agreement and the Plan (which is incorporated by reference herein and which in
all cases shall control in the event of any conflict with the terms, definitions
and provisions of this Agreement).  If
designated in the Notice of Grant as an “incentive stock option”, the Option is
intended to qualify for Federal income tax purposes as an “incentive stock
option” within the meaning of Section 422 of the Internal Revenue Code of
1986, as amended (the “Code”).  A copy of
the Plan as in effect on the date hereof has been supplied to the Participant,
and the Participant hereby acknowledges receipt thereof.


 


2.                                      Term.


 


The term (the “Option Term”)
of the Option shall commence on the Date of Grant and shall expire on the
Expiration Date set forth in the Notice of Grant, unless such Option shall
theretofore have been terminated in accordance with the terms hereof or of the
Plan.


 


3.                                      Time of Exercise.


 


(a)                                 The Option shall
be vested and exercisable as set forth in the Notice of Grant.


 


(b)                                 Anything
contained in this Agreement to the contrary notwithstanding, to the extent that
this Option is intended to be an “incentive stock option”, as set forth in the
Notice 


 


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of Grant, the Option shall
not be exercisable as an incentive stock option, and shall be treated as a
non-qualified stock option, to the extent that the aggregate Fair Market Value
(as determined in accordance with Section 6(b) of the Plan) on the
date hereof of all stock with respect to which incentive stock options are
exercisable for the first time by the Participant during any calendar year
(under the Plan and all other plans of the Company and its Subsidiaries, if
any) exceeds $100,000.


 


4.                                      Termination of Option.


 


(a)                                 The unexercised
portion of the Option shall automatically terminate and shall become null and
void and be of no further force or effect upon the first to occur of the
following:


 


(i)                                     the expiration
of the Option Term;


 


(ii)                                  the expiration
of ninety (90) days from the date of the Participant’s Termination of Service
(other than as a result of death, Disability or a Termination of Service by the
Company or an Affiliate for Cause); provided, however, that if
the Participant shall die during such ninety-day period, the time of
termination of the unexercised portion of the Option shall be one year from the
date of the Participant’s death;


 


(iii)                               the expiration
of one year from the date of the Participant’s Termination of Service if such
Termination of Service is a result of the Participant’s death or Disability;


 


(iv)                              immediately
upon the Participant’s Termination of Service if such Termination of Service is
by the Company or an Affiliate for Cause;


 


(v)                                 except to the
extent permitted by Section 7(c) of the Plan or Section 11, the
date on which the Option or any part thereof or right or privilege relating
thereto is transferred (otherwise than by will or by the laws of descent and
distribution), assigned, pledged, hypothecated, attached or otherwise disposed
of by the Participant; and


 


(vi)                              except as
otherwise permitted by the Committee, the date on which the Participant
breaches any confidentiality, non-competition or non-solicitation agreement
between the Participant and the Company or the date on which the Participant
engages in a Detrimental Activity.  For
purposes of this Agreement, a “Detrimental Activity” means (1) the
rendering of services for any organization or engaging directly or indirectly in
any business which is or becomes competitive with the Company, or which
organization or business, or the rendering of services to such organization or
business, is or becomes otherwise prejudicial to or in conflict with the
interests of the Company; (2) the disclosure to anyone outside the
Company, or the use in other than the Company’s business without the prior
written authorization from the Company, of any confidential information or
material; (3) any attempt to directly or indirectly induce any employee of
the Company (or any person who was an Employee or Consultant during the
six-month period preceding the Participant’s Termination of Service) to be
employed or perform services elsewhere; (4) any attempt directly or
indirectly to solicit the trade or business of any current or prospective
customer (or entity that was a customer during the six-month period preceding
the Participant’s Termination of Service); or (5) any other conduct or act



 


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determined
to be injurious, detrimental or prejudicial to any interest of the Company, in
each case as determined by the Committee in its sole discretion.  For purposes of this clause (vi), the term “Company”
means the Company and its Affiliates.


 


(b)                                 Anything contained
herein to the contrary notwithstanding, the Option shall not be affected by any
change of duties or position of the Participant (including a transfer to or
from the Company or any of its Affiliates), so long as the Participant
continues to be an Employee or a Consultant.


 


(c)                                  In the event of
the Participant’s Termination of Service, the Company shall have the right, but
not the obligation, to repurchase any and all Optioned Shares as set forth in
the Notice (defined in Section 5(a)) or in any stockholders, stock
restriction or similar agreement to which the Participant is a party, as
applicable.


 


5.                                      Procedure for Exercise.


 


(a)                                 The Option may
be exercised, from time to time, in whole or in part (but for the purchase of
whole shares only), by delivery of a written notice in the form attached as Exhibit A
hereto (the “Notice”) from the Participant to the Chief Financial Officer of
the Company, which Notice shall:


 


(i)                                     state that the
Participant elects to exercise the Option;


 


(ii)                                  state the
number of shares with respect to which the Option is being exercised (the “Optioned
Shares”);


 


(iii)                               state the
method of payment for the Optioned Shares pursuant to Section 5(b);


 


(iv)                              state the date
upon which the Participant desires to consummate the purchase of the Optioned
Shares (which date must be prior to the termination of such Option and no
sooner that 5 business days from the delivery of such Notice and no later than
30 calendar days from the delivery of such Notice, as may be appropriately
adjusted by the Committee in the event of a Change in Control);


 


(v)                                 if the Option
shall be exercised by any person other than the Participant, include evidence
to the satisfaction of the Committee of the right of such person to exercise
the Option pursuant to Section 11; and


 


(vi)                              include such
further provisions consistent with the Plan (including, without limitation, the
execution of a joinder to a stockholders agreement and/or stock restriction
agreement or similar agreement) as the Committee may from time to time require.


 


(b)                                 Payment of the
Option Price for the Optioned Shares shall be made (i) in cash or by
personal or certified check payable to the Company, (ii) by delivery of
stock certificates (in negotiable form) representing shares of Option Stock
that have been owned of record by the Participant for more than six months on
the date of exercise and that have a Fair Market Value on the date of exercise
(determined in the manner set forth in Section 6(b) of the 


 


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Plan as if the date of
exercise were the Date of Grant) equal to the aggregate Option Price of the
Optioned Shares, (iii) in compliance with any cashless exercise program
authorized by the Committee in its sole discretion; or (iv) a combination
of the methods set forth in the foregoing clauses (i), (ii) and (iii).


 


(c)                                  The Company
shall issue (or cause to be issued) a stock certificate in the name of the
Participant (or such other person exercising the Option in accordance with the
provisions of Section 11) for the Optioned Shares as soon as reasonably
practicable after receipt of the Notice and payment of the aggregate Option
Price for such shares.  Such stock
certificate shall contain the legend set forth in Section 7 of the
Exercise Notice attached hereto as Exhibit A.


 


6.                                      Withholding.


 


The
Committee shall be entitled to require as a condition of delivery of shares of
Option Stock in connection with the exercise of an Option that the Participant
remit or, in appropriate cases, agree to remit when due, an amount sufficient
to satisfy all current or estimated future federal, state and local withholding
tax and employment tax requirements relating thereto.  The Committee may in its discretion permit
the minimum statutorily required withholding obligations be satisfied by having
the Company withhold a portion of the shares that would otherwise be issued to
the Participant upon exercise of an Option, if any.


 


7.                                      No Rights as a Stockholder.


 


The Participant shall not
have any privileges of a stockholder of the Company with respect to any
Optioned Shares until the date of issuance of a stock certificate pursuant to Section 5(c).


 


8.                                      Adjustments.


 


(a)                                 Changes in
Capital Structure.  Subject to Section 8(b),
if the Option Stock is changed by reason of a change in corporate capitalization,
such as a stock split, reverse stock split, stock dividend or recapitalization,
or converted into or exchanged for other securities as a result of a merger,
consolidation or reorganization, the Committee shall make such adjustments as
shall be equitable and appropriate in order to make any outstanding Option, as
nearly as may be practicable, equivalent to the portion of the Option
outstanding as of the effective date of such transaction.  Anything contained in the Plan or in this
Agreement to the contrary notwithstanding, in the case of ISOs, no adjustment
under this Section 8(a) shall be appropriate if such adjustment (i) would
constitute a modification, extension or renewal of such ISOs within the meaning
of Sections 422 and 424 of the Code, and the regulations promulgated by the
Treasury Department thereunder, or (ii) would, under Section 422 of
the Code and the regulations promulgated by the Treasury Department thereunder,
be considered the adoption of a new plan requiring stockholder approval.


 


(b)                                 Change in
Control.  Notwithstanding any provision
of the Plan to the contrary, in the event of a Change in Control, the Committee
may make such adjustments and/or settlements of the outstanding portion of the
Option as it deems appropriate and consistent with the Plan’s purposes,
including, without limitation, canceling the Option if the Option Price 


 


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exceeds the price paid for a
share of Option Stock in connection with a Change in Control; provided, however,
that (1) in the event of any inconsistency between the provisions of this
subsection (b) and any provision in the Notice of Grant regarding vesting
upon a Change in Control, the provisions in the Notice of Grant shall govern
and (2) in the event of the assumption of the Option by, or the
substitution for such Option of a new option covering the stock of, the
surviving, successor or purchasing corporation, or a parent or subsidiary
thereof, with appropriate adjustments as to the number, kind and option price
of shares subject to such option, the Committee shall, in the case of ISOs, to
the extent not inconsistent with the best interests of the Company or its
Affiliates (such best interests to be determined in good faith by the Committee
in its sole discretion), use its best efforts to ensure that any such
assumption or substitution will not constitute a modification, extension or
renewal of the ISOs within the meaning of Section 424(h) of the Code
and the regulations promulgated by the Treasury Department thereunder.  Notwithstanding
the foregoing or any provision of the Plan or this Agreement to the contrary,
in the event of a Change in Control, if (i) prior to or in connection
therewith the Company achieves or has achieved the Target (as defined in the
Notice of Grant) and (ii) the Option is not being assumed by, or
substituted for new options (“New Options”) covering the stock of, the
surviving, successor or purchasing corporation, or a parent or subsidiary
thereof, 100% of the Option shall vest upon the consummation of such Change in
Control.  Further, in the event of a
Change in Control, if (i) prior to or in connection therewith the Company
achieves or has achieved the Target (as defined in the Notice of Grant) and (ii) during
the twelve-month period following such Change in Control, a Termination of
Service occurs and such Termination of Service is by the Company or any
Affiliate for any reason other than for Cause or Disability, 100% of the Option
or New Options, as applicable, shall vest immediately.


 


(c)                                  Any adjustments
referred to in Section 8(a) or (b) shall be made by the
Committee in its sole discretion and shall be conclusive and binding on the
Participant.


 


9.                                      Additional Provisions Related to Exercise.


 


(a)                                 The Option
shall be exercisable only on such date or dates and during such period and for
such number of shares of Option Stock as are set forth in this Agreement.


 


(b)                                 To exercise the
Option, the Participant shall follow the procedures set forth in Section 5
hereof.  Upon the exercise of the Option
at a time when there is not in effect a registration statement under the
Securities Act of 1933, as amended (the “Securities Act”), relating to the
shares of Option Stock issuable upon exercise of the Option, the Committee in
its discretion may, as a condition to the exercise of the Option, require the
Participant (i) to make the representations set forth in Exhibit B
hereto and (ii) to make such other representations and warranties as are
deemed appropriate by counsel to the Company. 
No shares of Option Stock shall be issued and delivered upon the
exercise of the Option unless and until the Company and/or the Participant
shall have complied with all applicable Federal or state registration, listing
and/or qualification requirements and all other requirements of law or of any
regulatory agencies having jurisdiction.


 


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10.                               No Evidence
of Employment or Consulting Relationship.


 


Nothing
contained in the Plan or in this Agreement shall confer upon the Participant
any right with respect to the continuation of his or her employment by, or
service relationship with, the Company or any Affiliate or interfere in any way
with the right of the Company or any Affiliate (subject to the terms of any
separate agreement to the contrary), at any time to terminate such employment
or service relationship or to increase or decrease the compensation of the
Participant from the rate in existence at the time of the grant of the
Option.  For the avoidance of doubt, this
Option shall not guarantee employment for the length of all, or any portion of,
the vesting schedule set forth in the Notice of Grant.


 


11.                               Restriction
on Transfer.


 


The
Option may not be transferred, pledged, assigned, hypothecated or otherwise
disposed of in any way by the Participant, except by will or by the laws of
descent and distribution, and may be exercised during the lifetime of the
Participant only by the Participant.  If
the Participant dies, the Option shall thereafter be exercisable, during the
period specified in Section 4(a)(iii), by the Participant’s executors or
administrators to the full extent to which the Option was exercisable by the
Participant at the time of the Participant’s death. The Option shall not be
subject to execution, attachment or similar process.  Any attempted assignment, transfer, pledge,
hypothecation or other disposition of the Option contrary to the provisions
hereof, and the levy of any execution, attachment or similar process upon the
Option, shall be null and void and without effect.


 


12.                               Lock-Up
Period.


 


In
the event that the Company files a registration statement under the Securities
Act with respect to an underwritten public offering of any Option Stock, the
Participant shall be prohibited from effecting any public sale or distribution
of any Option Stock (other than as part of such underwritten public offering),
including, but not limited to, pursuant to Rule 144 or Rule 144A
under the Securities Act, during the “lock-up” period established by the
Committee, which lock-up period shall be no shorter than that required by the
underwriters of such public offering.


 


13.                               Disqualifying
Dispositions.


 


If
Optioned Shares acquired by exercise of an ISO are disposed of within two years
following the date of this Agreement or one year following the issuance thereof
to the Participant (a “Disqualifying Disposition”), the Participant shall,
immediately prior to such Disqualifying Disposition, notify the Company in
writing of the date and terms of such Disqualifying Disposition and provide
such other information regarding the Disqualifying Disposition as the Company
may reasonably require.


 


14.                               Notices.


 


All
notices or other communications which are required or permitted hereunder shall
be in writing and sufficient if (i) personally delivered, (ii) sent
by nationally-recognized overnight courier or (iii) sent by registered or
certified mail, postage prepaid, addressed as follows:


 


if to the Participant, to
the address set forth on the Notice of Grant; and


 


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if to the Company, to:


 


NetSpend Holdings, Inc.


c/o Netspend Corporation


Austin Centre


701 Brazos Street, 12th Floor


Austin, TX 78701


Attention: Chief Financial
Officer


 


or to such other address as
the party to whom notice is to be given may have furnished to each other party
in writing in accordance herewith.  Any
such communication shall be deemed to have been given (x) when delivered,
if personally delivered, (y) on the first Business Day (as hereinafter
defined) after dispatch, if sent by nationally-recognized overnight courier and
(z) on the third Business Day following the date on which the piece of
mail containing such communication is posted, if sent by mail.  As used herein, “Business Day” means a day
that is not a Saturday, Sunday or a day on which banking institutions in the
city to which the notice or communication is to be sent are not required to be
open.


 


15.                               Transfer
Restrictions; Mandatory Participation in Sale of the Company.


 


(a)                                 Prior to an
Initial Public Offering, the Participant agrees that he or she will not
Transfer all or any portion of the Optioned Shares, except in connection with,
and strictly in compliance with applicable securities laws and with this Section 15.


 


(b)                                 Sale of the
Company and/or Its Subsidiaries.


 


(i)                                     Conditions.  So long as Oak continues to hold at least a
majority of the Common Stock (on an as converted basis) held by it on the
effective date of the Plan, if Oak determines to pursue the sale of the
business of the Company and/or its Subsidiaries to a third party that is not (i) an
Affiliate of Oak or (ii) a Person in which Oak or an Affiliate of Oak
holds a direct or indirect equity interest (other than a ownership interest of
less than 5% of the outstanding capital stock of a public company) or any other
material interest (as a creditor or otherwise) (a “Third Party Purchaser”)
in a bona fide arms’ length transaction (whether by way of a merger,
consolidation, sale of all or substantially all of its assets, sale of
outstanding capital stock or otherwise) (an “Approved Sale”), then,
subject to the provisions of subsection (c) of this Section 15:


 


(A)  the Participant shall, subject to the conditions set forth in
subsection (c), consent to, vote for, and raise no objections against, and
waive dissenters and appraisal rights (if any) with respect to, the Approved
Sale, and


 


(B)  if the Approved Sale is structured as a sale of stock, the
Participant will agree to sell and will be permitted to sell all of the
Optioned Shares on the terms and conditions approved by Oak.


 


(C)  if the Approved Sale includes the sale, contribution,
exchange, redemption, cancellation or other disposition of options, the
Participant 


 


7

















 


will
sell, contribute, exchange, redeem, cancel or otherwise dispose of the Option
on the terms and conditions approved by the Oak.


 


The
Participant will take all reasonably necessary and desirable actions to
consummate such Approved Sale, including, without limitation, the execution of
all agreements and other instruments and such other actions reasonably
necessary to effectuate the allocation and distribution of the aggregate
consideration upon the Approved Sale as set forth in subsection (c) below.


 


(c)                                  Approved Sale
Obligations.  The
obligations of the Participant with respect to an Approved Sale are subject to
the satisfaction of the conditions that:


 


(i)                                     the proceeds of
the Approved Sale are applied in accordance with the Company’s Certificate of
Incorporation as in effect immediately prior to such Approved Sale;


 


(ii)                                  each holder of
shares of capital stock of the Company shall receive the same proportion of the
aggregate consideration from such Approved Sale that such holder would have
received if such aggregate consideration had been distributed by the Company in
complete liquidation pursuant to the rights and preferences set forth in the
Company’s Certificate of Incorporation as in effect immediately prior to such
Approved Sale and no holder of any shares of capital stock of the Company shall
receive any consideration of any kind from the purchaser or any of its
Affiliates other than such proportionate consideration (except in respect of
such holder’s employment with the Company and other matters personal to such
holder);


 


(iii)                               upon the
consummation of the Approved Sale, all of the holders of each class of Option
Stock will receive the same form and amount of consideration per share of each
such class of Option Stock;


 


(iv)                              if any holder
of a particular class of Option Stock is given an option as to the form and
amount of consideration to be received, all holders of the same class or series
of stock will be given the same option;


 


(v)                                 the Participant
shall not be required to make any representations or warranties other than
representations and warranties about the Company and its business, operations,
liabilities and the like that are required by all Stockholders, in which case,
the indemnification obligations of the Participant with respect to any such
representations and warranties provided for in this clause (v) shall be
limited to the Participant’s pro rata portion thereof (based upon the share
ownership of all Stockholders).


 


(d)                                 Prohibited
Transfers.  If any
purported Transfer is made or attempted contrary to the provisions of this
Agreement, such purported Transfer shall be void ab initio; the Company, and the Stockholders
shall have, in addition to any other legal or equitable remedies which they may
have, the right to enforce the provisions of this Agreement by actions for
specific performance (to the extent permitted by law); and the Company shall
have the right to refuse to recognize any Transferee as one of its stockholders
for any purpose.  Without limitation to
the foregoing, the Participant (and any Permitted Transferees) further agree
that the provisions of Section 20 shall apply in the event of any
violation or threatened violation of this Agreement.


 


8

















 


(e)                                  Definitions.


 


(i)                                     “Initial
Public Offering” means the first firm commitment underwritten public
offering for shares of Option Stock pursuant to an effective registration
statement under the Securities Act with aggregate gross proceeds of at least
$25,000,000.


 


(ii)                                  “Oak”
means Oak Investment Partners X, Limited Partnership and/or Oak X Affiliates
Fund, L.P.


 


(iii)                               “Permitted
Transfer” shall mean any Transfer permitted under this Agreement or the Plan.


 


(iv)                              “Permitted
Transferee” shall mean any Transferee of a Participant permitted under this
Agreement or the Plan.


 


(v)                                 “Stockholder”
and “Stockholders” shall have the meaning set forth in the Preamble.


 


(vi)                              “Transfer”
means any direct or indirect transfer, donation, sale, assignment, pledge,
hypothecation, grant of a security interest in or other disposal of all or any
portion of a Security or of any rights thereunder.  “Transferred” means the accomplishment
of a Transfer, and “Transferee” means the recipient of a Transfer.


 


16.                               No Waiver.


 


No
waiver of any breach or condition of this Agreement shall be deemed to be a
waiver of any other or subsequent breach or condition, whether of like or
different nature.


 


17.                               Participant
Undertaking.


 


The
Participant hereby agrees to take whatever additional actions and execute
whatever additional documents the Company may in its reasonable judgment deem
necessary or advisable in order to carry out or effect one or more of the
obligations or restrictions imposed on the Participant pursuant to the express
provisions of this Agreement.


 


18.                               Successors
and Assigns.


 


Except
as otherwise provided herein, this Agreement shall bind and inure to the
benefit of and be enforceable by the Participant and the Company and their
respective successors, assigns, heirs, representatives and estates, as the case
may be (including subsequent holders of Optioned Shares); provided, however,
that the rights and obligations of the Participant under this Agreement shall
not be assignable except in connection with a Permitted Transfer of Optioned
Shares hereunder (so long as the transferee agrees in writing in advance to
become bound by the terms and conditions hereof).


 


9

















 


19.                               Modification
of Rights.


 


The
rights of the Participant are subject to modification and termination in
certain events as provided in this Agreement and the Plan.


 


20.                               Governing
Law.


 


(a)                                 This Agreement
shall be deemed to be a contract made under, and shall be construed in accordance
with, the laws of the State of Delaware, without giving effect to conflict of
laws principles thereof.


 


(b)                                 Each of the
parties hereto hereby irrevocably and unconditionally submits, for himself or
herself and his or her property, to the nonexclusive jurisdiction of any
Delaware State court or any federal court of the United States of America
sitting in the State of Delaware, and any appellate court from any thereof, in
any action or proceeding arising out of or relating to this Agreement or for recognition
or enforcement of any judgment, and each of the parties hereto hereby
irrevocably and unconditionally agrees that all claims in respect of any such
action or proceeding may be heard and determined in any such Delaware State
court or, to the extent permitted by law, in any such federal court.  Each of the parties hereto agrees that a
final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law.


 


(c)                                  Each of the
parties hereto irrevocably and unconditionally waives, to the fullest extent
that he or she may legally and effectively do so, any objection that he or she
may now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to the Agreement in any Delaware state or federal
court sitting in the State of Delaware. 
Each of the parties hereto irrevocably waives, to the fullest extent
permitted by law, the defense of an inconvenient forum to the maintenance of
such action or proceeding in any such court.


 


21.                               Counterparts.


 


This
Agreement may be executed in one or more counterparts, each of which shall be
deemed to be an original, but all of which together shall constitute one and
the same instrument.


 


22.                               Entire
Agreement.


 


This
Agreement (including the Notice of Grant), the Plan and, upon execution, the
Exercise Notice and the Investment Representation Statement, constitute the
entire agreement between the parties with respect to the subject matter hereof,
and supersede all previously written or oral negotiations, commitments,
representations and agreements with respect thereto.


 


23.                               WAIVER OF
JURY TRIAL. 
NO PARTY TO THIS AGREEMENT OR ANY ASSIGNEE, SUCCESSOR, HEIR OR PERSONAL
REPRESENTATIVE OF A PARTY SHALL SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING,
COUNTERCLAIM OR ANY OTHER LITIGATION PROCEDURE BASED UPON OR ARISING OUT OF
THIS AGREEMENT.  NO PARTY WILL SEEK TO
CONSOLIDATE ANY SUCH ACTION, IN WHICH A JURY TRIAL HAS BEEN WAIVED, WITH
ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT OR HAS NOT BEEN WAIVED.  THE PROVISIONS OF THIS SECTION HAVE BEEN
FULLY DISCUSSED BY THE PARTIES HERETO, AND THESE PROVISIONS SHALL BE SUBJECT TO



 


10

















 


NO
EXCEPTIONS.  NEITHER PARTY HAS IN ANY WAY
AGREED WITH OR REPRESENTED TO THE OTHER PARTY THAT THE PROVISIONS OF THIS SECTION WILL
NOT BE FULLY ENFORCED IN ALL INSTANCES.


 


11

















 


IN WITNESS WHEREOF, the
parties hereto have executed this Agreement as of the date first written above.


 


	
   

  	
  NetSpend
  Holdings, Inc.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Participant

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  



 


Acknowledgment
and Agreement of Spouse


 


The undersigned spouse of
the Participant acknowledges that he/she has read this agreement and agrees to
be bound thereby to the extent that the Participant has executed such document.


 


 


	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  



 


Declaration
of Unmarried Status


 


I,
                                        ,
the undersigned hereby declare that I am not married as of the date hereof.


 


	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  



 














 


EXHIBIT A


 


Amended and Restated NetSpend Holdings, Inc. 2004 Stock
Option Plan

Exercise Notice


 


NetSpend Holdings, Inc.


c/o Netspend Corporation


Austin Centre


701 Brazos Street, 12th Floor


Austin, TX 78701


Attention:  Chief Financial Officer


 


Date of Notice: 


 


1.                                      Exercise of
Option.  Effective as of
                                      ,
      , [Please
insert date that is at least 5 days from the Date of Notice and no later than
30 days from the Date of Notice], the undersigned (the “Participant”)
hereby elects to exercise the Participant’s option to purchase
                                
shares of the Common Stock (the “Shares”)
of NetSpend Holdings, Inc. (the “Company”) under and pursuant to the 2004
Stock Option Plan (the “Plan”) and the Stock Option Agreement, dated
                         ,
200   (the “Stock Option Agreement”).


 


2.                                      Representations of the Participant.  The Participant acknowledges that the
Participant has received, read and understood the Plan and the Stock Option
Agreement and the Investment Representation Statement and agrees to abide by
and be bound by their terms and conditions.


 


3.                                      Rights as Stockholder.  Until the stock certificate evidencing such
Shares is issued (as evidenced by the appropriate entry on the books of the
Company or of a duly authorized transfer agent of the Company), no right to
vote or receive dividends or any other rights as a stockholder shall exist with
respect to the Shares, notwithstanding the exercise of the Option.  The Company shall issue (or cause to be
issued) such stock certificate as soon as practicable after the Option is
exercised.  No adjustment will be made
for a dividend or other right for which the record date is prior to the date
the stock certificate is issued, except as provided in Section 10 of the
Plan.


 


The Participant shall enjoy
rights as a stockholder until such time as the Participant disposes of the
Shares.  Upon such disposition, the
Participant shall have no further rights as a holder of the Shares so purchased
except the right to receive payment for the Shares so purchased in accordance
with the provisions of the Option Agreement, and the Participant shall
forthwith cause the certificate(s) evidencing the Shares so purchased to
be surrendered to the Company and/or its assignee(s) for transfer or
cancellation.


 


4.                                      Plan; Transfer Restrictions; Drag-Along.  Unless otherwise determined by the Committee,
any shares of Stock acquired pursuant to this Option (including any Shares
acquired by way of stock dividend or stock split or in connection with a
combination of shares, 


 


A-1

















 


recapitalization, merger,
consolidation or other reorganization) shall be subject to the Option Agreement
and the Plan including, without limitation, transfer restrictions and the
Company’s right to require the Participant to sell the Optioned Shares and
otherwise cooperate in the event of an Approved Sale as set forth in Section 15
of the Option Agreement.


 


5.                                      Repurchase Right for Participants.


 


(a)                                 In the event of
the Participant’s Termination of Service, the Company shall have the right, but
not the obligation, to repurchase any and all Optioned Shares acquired by the
Participant (for cash or cancellation of purchase money indebtedness for the
Optioned Shares) within 185 days following the date of the Participant’s
Termination of Service.  In the event of
the Participant’s Termination of Service for any reason other than by the
Company for Cause, the per share purchase price for each Optioned Share shall
be the Fair Market Value of a share of Common
Stock on the date of such Termination of Service.  In the event of a Participant’s Termination
of Service for Cause, the purchase price shall be the lower of the exercise
price for such Optioned Share and the Fair Market Value of such Optioned Share
on the date of such Termination of Service. 
The Company’s repurchase right set forth in this Section 5(a) shall
lapse upon an Initial Public Offering.


 


(b)                                 In the event of
the Company’s exercise of its repurchase right, the Participant and his, her or
its successors or assigns shall (i) take all steps necessary and desirable
to obtain all required third-party, governmental and regulatory consents and
approvals with respect to the surrender and cancellation of the Optioned Shares,
(ii) deliver for cancellation the certificate(s) representing the
Option Shares for cancellation in person or by first class mail, registered
mail, certified first class mail or by reputable overnight courier service to
the address set forth in the Company’s notice to the Participant within 10 days
of receipt of such notice and (iii) take all other actions necessary and
desirable to facilitate consummation of the repurchase and the cancellation of
the Option Shares in a timely manner.  If
the Participant fails or refuses to take any action required by this Section 5,
the Company may note in its stock ledger and books and records the cancellation
of the Participant’s Optioned Shares which are subject to cancellation after
application of this Section 5.


 


6.                                      Tax Consultation.  The Participant understands that the
Participant may suffer adverse tax consequences as a result of the Participant’s
purchase or disposition of the Shares. 
The Participant represents that the Participant has consulted with any
tax consultants the Participant deems advisable in connection with the purchase
or disposition of the Shares and that the Participant is not relying on the
Company for any tax advice.


 


7.                                      Restrictive Legends and Stop-Transfer Orders.


 


(a)                                 Legends.  The Participant understands and agrees that
the Company shall cause the legends set forth below or legends substantially
equivalent thereto, to be placed upon any certificate(s) evidencing
ownership of the Shares together with any other legends that may be required by
state or federal securities laws at the time of the issuance of the Shares:


 


THE SALE AND ISSUANCE OF THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE 


 


A-2

















 


SECURITIES ACT OF 1933, AS
AMENDED (THE “ACT”), OR UNDER THE SECURITIES LAW OF ANY STATE OR OTHER
JURISDICTION.  THESE SECURITIES HAVE BEEN
ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE
DISTRIBUTION THEREOF.  THESE SECURITIES MAY NOT
BE OFFERED, SOLD, PLEDGED, OR TRANSFERRED UNLESS (I) A REGISTRATION
STATEMENT UNDER THE ACT IS IN EFFECT AS TO THESE SECURITIES AND SUCH OFFER,
SALE, PLEDGE, OR TRANSFER IS IN COMPLIANCE WITH APPLICABLE SECURITIES LAW OF
ANY STATE OR OTHER JURISDICTION OR (II) THERE IS AN OPINION OF COUNSEL OR
OTHER EVIDENCE, IN EITHER CASE, SATISFACTORY TO THE CORPORATION, THAT AN
EXEMPTION THEREFROM IS AVAILABLE AND THAT SUCH OFFER, SALE, PLEDGE, OR TRANSFER
IS IN COMPLIANCE WITH APPLICABLE SECURITIES LAW OF ANY STATE OR OTHER JURISDICTION.


 


TRANSFER OF THE SECURITIES
REPRESENTED BY THIS CERTIFICATE IS SUBJECT TO THE CONDITIONS SPECIFIED IN AN
AWARD AGREEMENT BETWEEN THE ISSUER AND A PARTICIPANT IN THE ISSUER’S 2004 STOCK
OPTION PLAN.  NO TRANSFER OF THE
SECURITIES REPRESENTED BY THIS CERTIFICATE SHALL BE VALID OR EFFECTIVE UNTIL
SUCH CONDITIONS HAVE BEEN FULFILLED. 
SUCH AGREEMENTS MAY BE INSPECTED AT THE PRINCIPAL EXECUTIVE OFFICES
OF THE ISSUER.


 


(b)                                 Stop-Transfer
Notices.  The Participant agrees that,
in order to ensure compliance with the restrictions referred to herein, the
Company may issue appropriate “stop transfer” instructions to its transfer
agent, if any, and that, if the Company transfers its own securities, it may
make appropriate notations to the same effect in its own records.


 


(c)                                  Refusal to
Transfer.  The Company
shall not be required (i) to transfer on its books any Shares that have
been sold or otherwise transferred in violation of any of the provisions of
this Agreement or (ii) to treat as owner of such Shares or to accord the
right to vote or pay dividends to any purchaser or other transferee to whom
such Shares shall have been so transferred.


 


8.                                      Successors and Assigns.  The Company may assign any of its rights
under this Agreement to single or multiple assignees (who may be stockholders,
officers, directors, employees or consultants of the Company), and this
Agreement shall inure to the benefit of the successors and assigns of the
Company.  Subject to the restrictions on transfer
herein set forth, this Agreement shall be binding upon the Participant and his
or her heirs, executors, administrators, successors and assigns.


 


9.                                      Interpretation.  Any
dispute regarding the interpretations of this Agreement shall be submitted by
the Participant or by the Company forthwith to the Committee, which shall
review such dispute at its next regular meeting.  The resolution of such a dispute by the
Committee shall be final and binding on the Company and on the Participant.


 


A-3

















 


10.                               Governing Laws; Severability.


 


(a)                                 This Agreement
shall be deemed to be a contract made under, and shall be construed in
accordance with, the laws of the State of Delaware, without giving effect to
conflict of laws principles thereof.


 


(b)                                 Each of the parties
hereto hereby irrevocably and unconditionally submits, for himself or herself
and his or her property, to the nonexclusive jurisdiction of any Delaware State
court or any federal court of the United States of America sitting in the State
of Delaware, and any appellate court from any thereof, in any action or
proceeding arising out of or relating to this Agreement or for recognition or
enforcement of any judgment, and each of the parties hereto hereby irrevocably
and unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in any such Delaware State court or, to
the extent permitted by law, in any such federal court.  Each of the parties hereto agrees that a final
judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law.


 


(c)                                  Each of the
parties hereto irrevocably and unconditionally waives, to the fullest extent
that he or she may legally and effectively do so, any objection that he or she
may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to the Agreement in any Delaware state or
federal court sitting in the State of Delaware. 
Each of the parties hereto irrevocably waives, to the fullest extent
permitted by law, the defense of an inconvenient forum to the maintenance of
such action or proceeding in any such court.


 


11.                               Specific Performance.  The right and remedy to seek from any court
of competent jurisdiction specific performance of the transfer restrictions set
forth or referenced herein or injunctive relief against any act which would
violate Section 4 hereof, it being acknowledged and agreed that any such
breach or threatened breach will cause irreparable injury to the Company and
that money damages will not provide an adequate remedy to the Company.


 


12.                               Notices.  Any notice
required or permitted hereunder shall be given in writing and shall be deemed
effectively given if given in the manner specified in the Stock Option
Agreement.


 


13.                               Further Instruments.  The parties agree to execute such further
instruments and to take such further action as may be reasonably necessary to
carry out the purposes and intent of this Agreement.


 


14.                               Delivery of Payment.  The Participant herewith delivers to the
Company the full Option Price for the Shares.


 


15.                               Definitions. 
Capitalized terms not defined herein shall have the meaning set forth in
the Plan.


 


16.                               Entire Agreement.  The Plan, the Notice of Grant, the Stock
Option Agreement and the Investment Representation Statement (if applicable)
are incorporated herein by reference. 
This Agreement, the Plan, the Notice of Grant, the Stock Option
Agreement and the Investment Representation Statement (if applicable)
constitute the entire agreement of the parties and 


 


A-4

















 


supersede in their entirety
all prior undertakings and agreements of the Company and the Participant with
respect to the subject matter hereof.


 


17.                               WAIVER OF JURY TRIAL.  NO PARTY TO THIS AGREEMENT OR ANY ASSIGNEE,
SUCCESSOR, HEIR OR PERSONAL REPRESENTATIVE OF A PARTY SHALL SEEK A JURY TRIAL
IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM OR ANY OTHER LITIGATION PROCEDURE
BASED UPON OR ARISING OUT OF THIS AGREEMENT. 
NO PARTY WILL SEEK TO CONSOLIDATE ANY SUCH ACTION, IN WHICH A JURY
TRIAL HAS BEEN WAIVED, WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT OR
HAS NOT BEEN WAIVED.  THE PROVISIONS OF
THIS SECTION HAVE BEEN FULLY DISCUSSED BY THE PARTIES HERETO, AND THESE
PROVISIONS SHALL BE SUBJECT TO NO EXCEPTIONS. 
NEITHER PARTY HAS IN ANY WAY AGREED WITH OR REPRESENTED TO THE OTHER
PARTY THAT THE PROVISIONS OF THIS SECTION WILL NOT BE FULLY ENFORCED IN
ALL INSTANCES.


 


[Signature
Page Follows]


 


A-5

















 


	
   

  	
  Submitted by:

  
	
   

  	
   

  
	
   

  	
  PARTICIPANT

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  (Signature)

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  



 


Acknowledgment
and Agreement of Spouse


 


The undersigned spouse of
the Participant acknowledges that he/she has read this agreement and agrees to
be bound thereby to the extent that the Participant has executed such document.


 


 


	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  



 


Declaration
of Unmarried Status


 


I,
                                        ,
the undersigned hereby declare that I am not married as of the date hereof.


 


	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Accepted by:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  NetSpend
  Holdings, Inc.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  



 


A-6

















 


EXHIBIT B


 


INVESTMENT REPRESENTATION STATEMENT


 


	
  PARTICIPANT:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  COMPANY
      :

  	
   

  	
  NetSpend
  Holdings, Inc.

  
	
   

  	
   

  	
   

  
	
  SECURITY     :

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  AMOUNT       :

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  DATE              :

  	
   

  	
   

  



 


In connection with the
purchase of the above-listed Securities, the undersigned Participant represents
to the Company the following:


 


The
Participant is aware of the Company’s business affairs and financial condition
and has acquired sufficient information about the Company to reach an informed
and knowledgeable decision to acquire the Securities.  The Participant is acquiring these Securities
for investment for the Participant’s own account only and not with a view to,
or for resale in connection with, a “distribution” thereof within the meaning
of the Securities Act.


 


The
Participant acknowledges and understands that the Securities constitute “restricted
securities” under the Securities Act and have not been registered under the
Securities Act in reliance upon a specific exemption therefrom, which exemption
depends upon, among other things, the bona fide nature of the Participant’s
investment intent as expressed herein. 
In this connection, the Participant understands that, in the view of the
Securities and Exchange Commission, the statutory basis for such exemption may
be unavailable if the Participant’s representation was predicated solely upon a
present intention to hold these Securities for the minimum capital gains period
specified under tax statutes, for a deferred sale, for or until an increase or
decrease in the market price of the Securities, or for a period of one year or
any other fixed period in the future. 
The Participant further understands that the Securities must be held
indefinitely unless they are subsequently registered under the Securities Act
or an exemption from such registration is available.  The Participant further acknowledges and
understands that the Company is under no obligation to register the
Securities.  The Participant understands
that the certificate evidencing the Securities will be imprinted with a legend
which prohibits the transfer of the Securities unless they are registered or
such registration is not required in the opinion of counsel satisfactory to the
Company and other legends required under the applicable state or federal
securities laws.


 


The
Participant is familiar with the provisions of Rule 701 and Rule 144,
each promulgated under the Securities Act, which, in substance, permit limited
public resale of “restricted securities” acquired, directly or indirectly from
the issuer thereof, in a non-public offering subject to the satisfaction of
certain conditions.  Rule 701
provides that if the issuer qualifies under Rule 701 at the time of the
grant of the Option to the Participant, the exercise will be exempt from
registration under the Securities Act.


 

















 


In the event that the
Company does not become subject to the requirements of Section 13 or 15(d) of
the Exchange Act, then the Securities may be resold in certain limited
circumstances subject to the provisions of Rule 144, which requires the
resale to occur not less than one year after the later of the date the
Securities were sold by the Company or the date the Securities were sold by an
affiliate of the Company, within the meaning of Rule 144; and, in the case
of acquisition of the Securities by an affiliate only, the satisfaction of the
following conditions: (1) the resale being made through a broker in an
unsolicited “broker’s transaction,” in transactions directly with a market
maker (as said term is defined under the Exchange Act) or in “riskless
principal transactions” (as said term is defined in the Note to Rule 144(f)(1));
(2) the amount of Securities being sold during any three month period not
exceeding the limitations specified in Rule 144(e); (3) the
availability of certain public information about the Company; and (4) the
timely filing of a Form 144, if applicable.


 


In
the event the Company becomes subject to the reporting requirements of Section 13
or 15(d) of the Exchange Act, then ninety (90) days thereafter (or such
longer period as any market stand-off agreement may require), Securities exempt
under Rule 701 may be resold by non-affiliates in reliance on Rule 144,
without compliance with any of the conditions set forth in Rule 144, and
Securities exempt under Rule 701 may be resold by affiliates in reliance
on Rule 144, subject to the satisfaction of the conditions set forth in
the clauses (1) through (4) immediately above and without compliance
with any specified holding period requirement.


 


The
Participant further understands that in the event all of the applicable
requirements of Rule 701 or Rule 144 are not satisfied, registration
under the Securities Act, compliance with Regulation A under the Securities
Act, or some other registration exemption will be required; and that,
notwithstanding the fact that Rules 144 and 701 are not exclusive, the
Staff of the Securities and Exchange Commission has expressed its opinion that
a person proposing to sell private placement securities other than in a
registered offering and otherwise than pursuant to Rules 144 or 701 will
have a substantial burden of proof in establishing that an exemption from
registration is available for such offers or sales, and that such persons and
their respective brokers who participate in such transactions do so at their
own risk.  The Participant understand
that no assurances can be given that any such other registration exemption will
be available in such event.


 


The Participant further
represents and warrants that it comes within the category or categories marked
below, and that for any category marked, it can truthfully set forth the factual
basis or reason the investor comes within that category.  The undersigned agrees to furnish any
additional information which the Company deems necessary in order to verify the
answers set forth below.


 


o                                    (a)                                 The Participant
is an individual (not a partnership, corporation, etc.) whose individual
net worth, or joint net worth with his or her spouse, presently exceeds
US$1,000,000.


 


Explanation:  In calculating net worth you may include
equity in personal property and real estate, including your principal
residence, cash, short-term investments, stock and securities.  Equity in personal property and real estate 


 

















 


should be based on the
appraised fair market value of such property less debt secured by such
property.


 


o                                    (b)                                 The Participant
is an individual (not a partnership, corporation, etc.) who had an income
in excess of US$200,000 in each of the two most recent years, or joint income
with his or her spouse in excess of US$300,000 in each of those years (in each
case including foreign income, tax exempt income and full amount of capital
gains and losses but excluding any income of other family members and any
unrealized capital appreciation) and has a reasonable expectation of reaching
the same income level in the current year.


 


o                                    (c)                                  The Participant
is a director or executive officer of the Company.


 


o                                    (d)                                 The Participant
is a non-profit organization within the meaning of Section 501(c)(3) of
the Internal Revenue Code, corporation, business trust, partnership or limited
liability company, in each case not formed for the specific purpose of
acquiring the Securities and with total assets in excess of US$5,000,000.  If so, please describe entity:


 


o                                    (e)                                  The Participant
is a trust with total assets in excess of US$5,000,000, not formed for the
specific purpose of acquiring the Securities, where the purchase is directed by
a “sophisticated person” as defined in Rule 506(b)(2)(ii) of
Regulation D under the Securities Act.


 


o                                    (f)                                   The Participant
is a revocable grantor trust in which each of the grantors is an individual who
(i) has a net worth, either alone or with his or her spouse, of more than
$1,000,000 or (ii) had income in excess of $200,000 during each of the
previous two years and reasonably expects to have income in excess of $200,000
during the current year, or joint income with his or her spouse in excess of
$300,000 during each of the previous two years and reasonably expects to have
joint income in excess of $300,000 during the current year.


 


o                                    (g)                                  The Participant
is an entity (other than a trust) all the equity owners of which are “accredited
investors” within one or more of the above categories.  If so, please describe entity:  (If relying upon this category
alone, each equity owner must complete a separate copy of this questionnaire.)


 


o                                    (h)                                 The Participant
is not within any of the categories above and is therefore a non-accredited
investor.


 


 


	
   

  	
  Signature of Participant:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
   

  	
  ,