Green Dot Agrees to Split CEO, Chairman Role amid Proxy Fight
A week from its 2016 annual shareholder meeting, Green Dot has announced plans to split up the role of chairman and CEO. The move comes in the midst of Green Dot’s proxy battle over board seats, propelled by Harvest Capital, which owns 9.3 percent of Green Dot common stock and has proposed three nominees to the board.
One independent proxy advisory firm has come out in support of Harvest Capital’s board nominees, Institutional Shareholder Services Inc., while another Glass Lewis and Co. supports one of Harvest’s three nominees. However, Glass Lewis advises against Harvest’s recommendation of removing Steve Streit as CEO and instead suggests splitting up the roles of chairman and CEO. “… we aren’t supportive of Harvest’s campaign to remove Mr. Streit as CEO and current leader of Green Dot—an action which doesn’t appear to us to be warranted or advisable at this time. … we also see evidence supporting the board’s argument that Green Dot is now headed in the right direction, specifically in view of the company’s most recent strong and improving performance, which despite Harvest’s continued critiques, has helped propel the company’s stock price 41 percent higher year-to-date, compared to virtually no gains among the Prepaid Peer Group,” Glass Lewis noted.
Green Dot said its board will appoint an independent chairman after the annual meeting and it will appoint one of Harvest’s board nominees, George Gresham, subject to his acceptance, regardless of the outcome of the 2016 annual meeting vote.
Green Dot is urging shareholders to vote on the white proxy card “for” the re-election of incumbent director nominees: Streit, founder, CEO and chairman, who owns 8 percent of Green Dot stock; Michael J. Moritz, a large Green Dot shareholder and current chairman of Sequoia Capital; and Timothy R. Greenleaf, audit committee chair, who oversees enterprise risk management committee and cybersecurity, key relationships with bank regulators and auditors.
Harvest’s board nominees on the green proxy card include: Philip B. Livingston, former CEO of Ambassadors Group; Saturnino Fanlo, president and chief financial officer of marketplace lender Social Finance Inc.; and Gresham, former chief financial officer and executive vice president, NetSpend. Gresham previously declined an offer to be immediately appointed to Green Dot’s board. At press time, Green Dot’s stock price was up more than 2.6 percent, to $23.46.