Document:

Exhibit 10.1

 

FORM OF

FIRST AMENDMENT TO EMPLOYMENT AGREEMENT

 

FIRST AMENDMENT (the “Amendment”), dated as of February 19, 2013 (the “Effective Date”), to that certain Management Employment Agreement, dated as of [DATE] (the “Employment Agreement”) by and among NetSpend Corporation, a Delaware corporation (the “Company”), and [EXECUTIVE], an individual resident of the State of [STATE NAME] (the “Executive”).

 

WHEREAS, the Company and the Executive have previously entered into the Employment Agreement; and

 

WHEREAS, the parties have determined to amend the Employment Agreement as set forth herein with respect to a change of control of NetSpend Holdings, Inc., a Delaware Corporation (“Holdings”) that occurs on or prior to December 31, 2013, if any;

 

NOW, THEREFORE, BE IT:

 

RESOLVED, that in consideration of the foregoing and the mutual covenants herein contained and for other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereto agree to amend the Employment Agreement as follows:

 

1.              The current text of Section 9 shall remain in its entirety as Section 10.

 

2.              A new Section 9, labeled “Treatment of Code Section 280G” shall be added as follows:

 

“(a)                            In the event that a Change of Control (as defined in the NetSpend Holdings, Inc. 2004 Equity Incentive Plan) occurs on or prior to December 31, 2013 and in the event it shall be determined that any payment (other than the payment provided for in this Section 9(a)) or distribution of any type to or for the benefit of the Executive, by the Company, any Affiliate of the Company, any Person who acquires ownership or effective control of the Company or ownership of a substantial portion of the Company’s assets (within the meaning of Section 280G of the Code and the regulations thereunder) or any Affiliate of such Person, whether paid or payable or distributed or distributable pursuant to the terms of this Employment Agreement or otherwise (the “Total Payments”), is or will be subject to the excise tax imposed by Section 4999 of the Code (such excise tax referred to as the “Excise Tax”), then the Executive shall be entitled to receive an additional payment (a “Gross-Up Payment”) in an amount such that after payment by the Executive of all taxes, including any income tax, employment tax or Excise Tax, imposed upon the Gross-Up Payment, the Executive retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Total Payments.

 

 

(b)                                  Subject to the provisions of Section 9(a) hereof, all determinations required to be made under this Section 9, including whether an Excise Tax is payable by the Executive and the amount of such Excise Tax and Gross-Up Payment, shall be made by the nationally recognized firm of certified public accountants (the “Accounting Firm”) as the Company may designate provided, however, the determination by Accounting Firm shall be subject to agreement by the Executive and his advisors (which agreement shall not unreasonably be withheld). If the Accounting Firm determines that any Excise Tax is payable by the Executive, the Company shall be required to make payment of the Gross-Up Payment, less all amounts withheld in respect of the Gross-Up Payment, as required by applicable law. All fees and expenses of the Accounting Firm shall be paid by the Company in connection with the calculations required by this Section 9(a).

 

(c)                                   A Gross-Up Payment shall be made within thirty (30) days of the payments giving rise to the Excise Tax and in no event later than the end of the calendar year following the calendar year in which the Executive remits the related taxes to the applicable governmental authority.  In the event of any underpayment or overpayment under this Section 9 as determined by the Company’s independent auditors (or such other firm as may have been designated in accordance with the preceding paragraph), the amount of such underpayment or overpayment shall forthwith be paid to the Executive or refunded to the Company, as the case may be, with interest at the applicable federal rate provided for in Section 7872(f)(2) of the Code; provided, however, in no event shall any reimbursement of the Executive for an underpayment be made later than the end of the calendar year following the calendar year in which the Executive remits the related taxes to the applicable governmental authority.

 

3.              The Employment Agreement is amended to renumber the Sections as necessary to reflect the addition of the new Section 9.

 

4.              For the avoidance of doubt, if no Change in Control (as defined in the as defined in the NetSpend Holdings, Inc. 2004 Equity Incentive Plan) occurs on or prior to December 31, 2013, the provisions set forth in paragraph 2 of this Amendment shall expire and become inapplicable as of January 1, 2014.

 

5.             This Amendment may be executed in two or more counterparts, all of which shall be deemed one and the same original.

 

 

IN WITNESS WHEREOF the undersigned have hereunto put their hands as of the date above written.

 

 

	
 
    	
NETSPEND   CORPORATION
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
[Executive]
    

 

[Signature Page EA Amendment 1]Exhibit 10.2

 

FORM OF

AWARD AGREEMENT AMENDMENT

 

February 19, 2013

 

[Executive]

[Address]

[City, State, zip]

 

Dear [Executive],

 

I am pleased to inform you that the Compensation Committee of NetSpend Holdings, Inc. (the “Company”) has favorably amended certain stock option and restricted stock awards (as set forth below) granted to you under the Amended and Restated NetSpend Holdings, Inc. 2004 Stock Option Plan (the “Plan”). This amendment generally provides that any unvested portion of the stock options and restricted stock awards to which this amendment applies will vest in full if your employment with the Company is terminated by the Company without Cause or if you terminate your employment for Good Reason (as defined in your employment agreement, or in the applicable award agreement if you are not a party to an employment agreement) in either case within the thirty-day period prior to a Change in Control, if it is reasonably demonstrated that such termination was at the request of a third party that has taken steps to effect a Change in Control or otherwise arose in connection with or anticipation of a Change in Control, it being agreed that termination of your employment pursuant to section 6.6(g) of the Agreement and Plan of Merger to be entered into among Total System Services, Inc, a Georgia corporation, General Merger Sub, Inc., a Delaware corporation and the Company shall result in such vesting without any required demonstration.

 

To effect this amendment, the applicable award agreement shall be amended as set forth below. If there is any conflict between the applicable award agreement or the Plan and the amended provisions as set forth herein, the amended provisions shall govern.

 

Amendment of Stock Options

 

The amendment set forth below shall apply to those stock option grants (each an “Option”) set forth on Schedule A attached hereto. The section of each Notice of Grant entitled “Vesting Schedule” or “Time Vesting Portion of the Option”, as applicable, shall be amended by:

 

1.                                      Adding a new sentence as the fourth sentence of the section entitled “Vesting Schedule” or “Time Vesting Portion of the Option”, as applicable, as follows:

 

In addition, if your employment with the Company is terminated by the Company or an Affiliates for any reason other than Cause or Disability, or you terminate your employment for “Good Reason” (as such term is defined in any employment

 

 

or like agreement between you and the Company and if you are not a party to an employment agreement, “Good Reason” shall have the meaning as set forth in your Restricted Stock Agreement dated February 9, 2012), in either event within the thirty-day period prior to the date on which a Change of Control occurs, and if it is reasonably demonstrated that such termination of employment (i) was at the request of a third party that has taken steps reasonably calculated to effect a Change of Control or (ii) otherwise arose in connection with or anticipation of a Change of Control, then 100% of the Option shall be vested immediately upon such termination, it being agreed that termination of your employment pursuant to section 6.6(g) of the Agreement and Plan of Merger to be entered into among Total System Services, Inc, a Georgia corporation, General Merger Sub, Inc., a Delaware corporation and the Company shall result in such vesting without any required demonstration.

 

2.                                      Replacing the words “the preceding sentence” with the words “the preceding two sentences” in the last sentence of the “Vesting Schedule” section.

 

Amendment of Restricted Stock

 

The amendment set forth below shall apply to those restricted stock grants (each an “Award”) set forth on Schedule B attached hereto. Section 3(c) of each Award shall be amended by:

 

1.                                      Adding a new sentence as the third sentence of Section 3(c), as follows:

 

In addition, if the Participant’s employment with the Company is terminated by the Company or any of its Affiliates for any reason other than Cause or if the Participant terminates his or her employment with the Company or any such Affiliate for “Good Reason” (as such term is defined in any employment or like agreement between participant and the Company or, if there is no such agreement, as defined below), in either event within the thirty-day period prior to the date on which a Change of Control occurs, and if it is reasonably demonstrated that such termination of employment (i) was at the request of a third party that has taken steps reasonably calculated to effect a Change of Control or (ii) otherwise arose in connection with or anticipation of a Change of Control, then 100% of the Shares shall vest immediately upon such termination, it being agreed that termination of your employment pursuant to section 6.6(g) of the Agreement and Plan of Merger to be entered into among Total System Services, Inc, a Georgia corporation, General Merger Sub, Inc., a Delaware corporation and the Company shall result in such vesting without any required demonstration.

 

 

Except as modified above, all terms and conditions of the Plan and your Options and Awards shall remain in full force and effect.

 

 

	
 
    	
Sincerely yours,
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Dan Henry
    

 

 

Schedule A

 

 

Schedule B

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