Green Dot 2010 Annual Report Download - page 84

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Note 9 — Stockholders’ Equity (continued)
The warrant is redeemable for cash by the holder if we fail to perform in accordance with the
customary contractual terms of the sales and marketing agreement. Should the third party fail to perform in
accordance with the terms of the sales and marketing agreement, we obtain an option to repurchase any
shares previously issued under the warrant.
As the option to purchase shares under the warrant is contingent upon the achievement of certain
sales volume or revenue targets, there is a possibility that no shares will become eligible for purchase.
Based on different possible outcomes, we developed a range of fair values for the warrant, and we
measured the warrant at its current lowest aggregate fair value within that range. As none of the
performance conditions have been met, the lowest aggregate fair value is zero. Accordingly, we have
not assigned any value to the warrant in our consolidated financial statements as of December 31, 2010 or
2009.
Follow-on Offering
On December 13, 2010, we completed a follow-on offering of 4,269,051 shares of our Class A
common stock at an offering price of $61.00 per share, all of which were sold by existing stockholders. We
did not receive any proceeds from the sale of shares of our Class A common stock on the follow-on
offering. Concurrent with the completion of the follow-on offering, certain selling stockholders exercised
vested options to purchase 936,301 shares of Class B common stock with a weighted-average exercise
price of $4.32 in order to sell the underlying shares of Class A common stock in the follow-on offering. We
received aggregate proceeds of $4.0 million from these exercises.
Convertible Preferred Stock
We had no shares of convertible preferred stock outstanding as of December 31, 2010. Our
convertible preferred stock at December 31, 2009 consisted of the following:
December 31, 2009
Authorized Outstanding
Liquidation
Amount
Proceeds Net of
Issuance Costs
Number of Shares
(In thousands)
Series
Series A . . . . . . . . . . . . . . . . . . . . . . 6,520 6,404 $ 1,930 $ 1,877
Series B . . . . . . . . . . . . . . . . . . . . . . 3,197 3,177 2,186 2,008
Series C . . . . . . . . . . . . . . . . . . . . . . 10,114 9,939 8,230 8,136
Series C-1. . . . . . . . . . . . . . . . . . . . . 4,541 4,240 5,976 5,976
Series C-2. . . . . . . . . . . . . . . . . . . . . 1,182 1,182 13,000 12,979
25,554 24,942 $31,322 $30,976
Prior to our initial public offering, our Certificate of Incorporation specified the following rights,
preferences, and privileges for our preferred stockholders.
Voting
Each share of Series A, B, C, C-1, and C-2 convertible preferred stock had voting rights equal to the
number of shares of common stock into which it was convertible and voted together as one class with the
common stock. Our preferred stockholders were entitled to elect four directors. Additionally, the holders of
our Series C, C-1 and C-2 shares, voting together, were entitled to elect one director. The approval of at
75
GREEN DOT CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)