Two senior Automattic executives signed reciprocal severance agreements during the brief period when Matt Mullenweg was placed on paid leave.
CFO Mark Davies, who served as interim CEO during Mullenweg’s absence, and Chief Legal Officer Andy Missan each signed the other’s severance agreement on September 10. The agreements provide for 12 months of base salary, accelerated equity vesting, the ability to exercise vested stock options, and an additional year of health coverage.
Mullenweg returned as CEO roughly 33 hours after being placed on leave, and both Davies and Missan have since left Automattic. The combined value of the severance packages comes to $8.15 million.
The details behind the severance deals
TechCrunch reviewed the severance agreements signed by Davies and Missan, along with an HR document relating to Davies. The documents outline the conditions attached to the executives’ departure packages, including the circumstances under which the benefits would apply.
The agreements require both executives to accept a broad release of claims and continue to follow confidentiality, nonsolicitation, and other legally binding restrictions after leaving the company.
The circumstances also prompted questions about who authorized the severance terms. In a post on X, Kellie Peterson noted that Davies and Missan signing each other’s agreements does not necessarily establish who approved the compensation. Peterson also pointed to their previous executive roles for context.
Missan had worked with a board-approved severance program at Archer Aviation, while Davies had previously received executive severance protection at Vivint. Those examples do not establish that Automattic’s board approved the agreements, but they highlight the distinction between signing a severance agreement and authorizing its terms.
The documents also set out how Automattic could terminate either executive for “cause.” The company would have 60 days after learning of the relevant conduct to notify the executive in writing. If the issue could be corrected, the executive would then have 30 days to address it. A majority of the board would subsequently have to agree that “cause” existed.
The definition covers several situations, including gross negligence that materially harms Automattic; knowing dishonesty, fraud or misrepresentation that causes material harm; material violations of the law resulting in material harm; material breaches involving confidentiality or intellectual property; and a felony or crime involving “moral turpitude,” a legal term referring to conduct considered inherently dishonest or morally reprehensible.
Davies’ agreement also addresses his temporary role as interim CEO. It states that being removed from that position would not constitute “Good Reason” if he remained CFO. “Good Reason” generally allows an executive to resign and still receive severance when there has been a qualifying deterioration in their employment conditions.
TechCrunch noted that the provision is not unusual in itself, but its wording relates specifically to Davies’ circumstances during the leadership change. It means that the end of his interim CEO role alone would not give him grounds to resign and claim severance while continuing as CFO.
The HR records also indicate that Davies had no Automattic stock when he departed, although he still held a large number of vested stock options. A source told TechCrunch that Davies had sold his stock a “few months ago,” but the publication said it could not confirm when the sale took place.
Automattic also changed its legal representation following the leadership dispute, as announced on X.
They announced that Stephen Shackelford and Shawn J. Rabin of Susman Godfrey LLP had replaced Gibson Dunn. TechCrunch also reported, citing sources, that Automattic’s general counsel Jordan Hinkes had his company account deactivated. Mullenweg later said on X that the change had been planned for weeks because Hinkes was joining an AI startup.
What remains unclear
The board has not publicly explained why it voted to place Mullenweg on paid leave. TechCrunch discussed several possible explanations based on its reporting, but did not establish which, if any, was behind the decision.
The leadership change came while Automattic was already dealing with allegations from WP Engine in an ongoing legal dispute. WP Engine filed sanctions alleging that Automattic and Mullenweg destroyed evidence, pointing to communications on Signal, WhatsApp and Telegram.
TechCrunch raised the possibility that the board may have viewed those allegations as a corporate risk and that its decision to remove Mullenweg temporarily could have been part of a response to them. If so, the change in leadership might have helped Automattic demonstrate to the court that it had taken action, with possible implications for sanctions, fines or settlement negotiations.
There was also speculation around whether the board had a separate objective in mind when it moved Mullenweg aside. Sources cited by TechCrunch said Mullenweg believed the temporary change could have been intended to give the board control of Automattic for another reason, with a strategic transaction among the possibilities. The report did not confirm that this was the board’s actual objective.
The dispute is scheduled to return to court on September 30, 2026. The hearing is expected to cover WP Engine’s allegations that Automattic and Matt Mullenweg failed to preserve evidence in the case.