EMPLOYMENT AGREEMENT
 
THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made as of the 1st  day of
August, 2011, by and between Xcel Brands, Inc. a Delaware corporation (the
“Company”), and Giuseppe Falco (the “Executive”), each a “Party” and
collectively the “Parties.”  Unless otherwise indicated, capitalized terms used
herein are defined in Section 2.1.
 
WHEREAS, the Company has determined that it is in the best interests of the
Company and its shareholders to enter into an employment agreement with the
Executive and the Executive is willing to serve as an employee of the Company.
 
NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth herein, it is agreed by and between the Executive and the Company as
follows:
 
ARTICLE I
EMPLOYMENT TERMS
 
1.1           Employment.  The Company will employ the Executive, and the
Executive accepts employment with the Company, upon the terms and conditions set
forth in this Agreement for the period beginning on the Effective Date and
ending as provided in Section 1.4(a) hereof (the “Employment
Period”).  Notwithstanding anything to the contrary contained in this Agreement,
if the Effective Date does not occur on or prior to October 1, 2011, then this
Agreement shall be deemed terminated; provided, however, that the provisions
contained in Section 1.5 shall remain in full force and effect.
 
 
1.2
Position and Duties.

 
(a)           Generally.  The Executive shall serve as the President, Chief
Operating Officer of the Izaac Mizrahi Brand (“IMB”) and in such capacity shall
be responsible for the general management of IMB , shall perform such duties as
are customarily performed by an officer with similar title and responsibilities
of a company of a similar size and shall have such power and authority as shall
reasonably be required to enable him to perform his duties hereunder; provided,
however, that in exercising such power and authority and performing such duties,
he shall at all times be subject to the authority, control and direction of the
Chief Executive Officer of the Company.
 
 
(b)           Duties and Responsibilities.  The Executive shall report directly
to Robert D’Loren, the Chief Executive Officer of the Company, or his successor,
and shall devote his full business time and attention to the business and
affairs of the Company and its Subsidiaries.  The Executive shall have such
duties, responsibility and authority as are customary and consistent with his
position.  The Executive shall perform his duties and responsibilities in a
diligent, trustworthy, businesslike and efficient manner and shall use his best
efforts during the Employment Period to protect, encourage and promote the best
interests of the Company and its stockholders.  The Executive shall not engage
in any other business activities that could reasonably be expected to conflict
with the Executive’s duties, responsibilities and obligations hereunder.
Notwithstanding the foregoing, nothing herein shall prohibit Executive from (i)
serving on corporate, civic or charitable boards or committees, (ii) delivering
lectures or fulfilling speaking engagements and (iii) managing personal
investments, so long as such activities do not materially interfere with the
performance of Executive’s responsibilities hereunder.  During the Employment
Period, the Executive shall promptly bring to the Company or its Subsidiaries,
as applicable, all investment or business opportunities relating to the Business
of which the Executive becomes aware.
 
 
 

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(c)           Principal Office.  The principal place of performance by the
Executive of his duties hereunder shall be the Company’s principal executive
offices in the New York Metropolitan area, although the Executive may be
required to travel outside of the area where the Company’s principal executive
offices are located in connection with the performance of Executive's duties for
the Company.
 
 
1.3
Compensation.

 
(a)           Base Salary.  The Executive’s base salary shall be $350,000 per
annum (the “Base Salary”).  The Base Salary payable for Fiscal Year 2011 shall
be prorated based on the number of days from and including the Effective Date
through and including December 31, 2011.  The Base Salary will be payable to the
Executive by the Company in regular installments in accordance with the
Company’s general payroll practices.  The Executive shall receive such increases
(but not decreases) in his Base Salary as the Board of Directors, or the
compensation committee of the Board of Directors, may approve in its sole
discretion from time to time; provided that the Executive’s Base Salary will be
reviewed for potential upward adjustment not less often than annually.
 
(b)           Cash Bonuses.  Executive shall be entitled to a cash bonus of up
to $50,000 per annum (“Cash Bonus”) based upon the following: one half of one
percent (0.5%) of all Isaac Mizrahi Live net sales in excess of $60 million on
QVC as reported by QVC to the Company.  The Cash Bonus shall be awarded to
Executive on the date that is the earlier of (i) the 90th day following the end
of the fiscal year to which the Cash Bonus relates and (ii) the first business
day following the date the Company’s annual report on Form 10-K for the fiscal
year to which the Cash Bonus relates is filed with the Securities and Exchange
Commission. Executive shall be eligible to receive a pro rata portion of the
Cash Bonus if Executive’s employment is less than a full year or ceases prior to
the end of the calendar year for which a Cash Bonus has not yet been paid.  The
Executive is eligible to receive additional cash bonuses at the discretion of
the Company’s compensation committee.
 
(c)           Withholding.  All payments made under this Agreement (including
Base Salary, Cash Bonuses, and other amounts) shall be subject to withholding
for income taxes, payroll taxes and other legally required deductions.
 
(d)           Expenses.  The Company will reimburse the Executive for all
reasonable expenses incurred by him in the course of performing his duties under
this Agreement that are consistent with the Company’s policies in effect at that
time with respect to travel, entertainment and other business expenses, subject
to the Company’s requirements with respect to reporting and documentation of
such expenses.
 
 
 

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(e)           Vacation; Holiday Pay and Sick Leave.  The Executive shall be
entitled to four (4) weeks’ paid vacation in each calendar year, which if not
taken during any year may be carried forward to any subsequent year.  Executive
shall receive holiday pay and paid sick leave as provided to other executive
employees of the Company.
 
(f)           Additional Benefits.  During the Employment Period, the Executive
shall be entitled to participate (for himself and, as applicable, his
dependents) in the group medical, life, 401(k) and other insurance programs,
employee benefit plans and perquisites which may be adopted by the Board, or the
compensation committee of the Board, from time to time, for participation by the
Company’s senior management or executives, as well as dental, life and
disability insurance coverage, with payment of, or reimbursement for, such
insurance premiums by the Company, subject to, in all cases, the terms and
conditions established by the Board with respect to such plans (collectively,
the “Benefits”); provided, however, that the Board, in its reasonable
discretion, may revise the terms of any Benefits so long as such revision does
not have a disproportionately negative impact on the Executive vis-à-vis other
Company employees, to the extent applicable.
 
(g)           Indemnification.  The Executive shall be entitled to
indemnification by the Company in the same circumstances and to the same extent
as the other executive officers and directors of the Company, which
indemnification shall in no event be less favorable to the Executive than the
fullest scope of indemnification permitted by applicable Delaware law (or any
such greater scope of indemnification provided by agreement or by the terms of
the Company’s Certificate of Incorporation or By-Laws to any executive officer
or director of the Company).
 
(h)           Stock Options. In the event that the Company elects from time to
time during the Employment Period to award to its senior management or
executives, generally, options to purchase shares of the Company’s stock
pursuant to any stock option plan or similar program, the Executive shall be
entitled to participate in any such stock option plan or similar program on a
basis consistent with the participation of other senior management or executives
of the Company.
 
(i)            Warrant. On the Closing Date, the Executive shall receive
warrants (the “Warrant Grant”) a warrant to purchase 100,000 shares of Company’s
common stock, with an exercise price per share equal to the price per share of
common stock (without allocating any value to any warrants, if any, sold with
the common stock) sold in the private placement anticipated to close on or about
the same day as the Closing Date and a 10-year term (the “Warrant”). The Warrant
shall vest equally over two years; 50,000 shares shall vest on the first
anniversary of the Closing Date, and 50,000 shares shall vest on the second
anniversary of the Closing Date.  The shares of the Company’s Common Stock
underlying the Warrant shall have customary piggy back registration and cashless
exercise rights.
 
 
1.4
Term and Termination.

 
(a)           Duration.  The Employment Period shall commence on the Effective
Date and the initial term shall terminate two (2) years from the Effective Date
(the “Initial Term”), unless earlier terminated by the Company or the Executive
as set forth in this Section 1.4.  The Term shall renew automatically for an
additional one-year period, unless either party gives the other party written
notice of its intention not to renew the Agreement no later than 30 days prior
to the expiration of the then current Term (the "Term").  At the end of the
three-year Term, the parties shall negotiate in good faith any extension and the
terms and conditions thereof. The Employment Period shall be terminated prior to
the then-applicable expiration of the Term upon the first to occur of (i)
termination of the Executive’s employment by the Company for Cause, (ii)
termination of the Executive’s employment by the Company without Cause, (iii)
the Executive’s resignation with Good Reason, (iv) the Executive’s resignation
other than for Good Reason, or (v) the Executive’s death or Disability.  The
Executive shall not terminate the Employment Period, with or without Good
Reason, unless he gives the Company written notice that he intends to terminate
the Employment Period at least 90 days prior to the Executive’s proposed
Termination Date.  As a condition to Executive receiving any payments or
benefits under Section 1.4(b), the Executive shall execute and deliver to the
Company the General Release in the form attached hereto as Exhibit A.
 
 
 

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(b)           Severance Upon Termination Without Cause, Upon Resignation by the
Executive For Good Reason or Failure to Renew Term.  If the Employment Period is
terminated by the Company without Cause or if the Executive resigns for Good
Reason, or if the Company fails to renew the Term (in which case termination of
the Executive’s employment shall be effective at the expiration of the
then-current Term), then the Executive will be entitled to receive (1) any
unpaid Base Salary through and including the Termination Date and any other
amounts, including any amounts due for  Cash Bonus, or other entitlements then
due and owing to the Executive as of the Termination Date; (2) an amount equal
to the Executive’s Base Salary (at the rate in effect on the date the
Executive’s employment is terminated) for a 6 month period following the
Executive’s termination of employment as described in this Section 1.4(b),
payable in a lump sum on the date that is six months following the Executive’s
“separation from service” (within the meaning of Section 409A of the Code)
occurring in connection with such termination (provided, however, that an amount
that qualifies for involuntary separation pay exception (within the meaning of
Code Section 409A and Final Treasury Regulations Section 1.409A-1(b)(9)(iii)(A))
and is otherwise permissible under Section 409A and the Final Treasury
Regulations, shall not be subject to such six-month delay and shall be paid to
Executive in a lump sum within thirty (30) days of the Executive's "separation
from service") and (3) continue to participate in the Company’s group medical
plan on the same basis as he previously participated or receive payment of, or
reimbursement for, COBRA premiums (or, if COBRA coverage is not available,
reimbursement of premiums paid for other medical insurance in an amount not to
exceed the COBRA premium) for a six-month period following the Executive’s
termination of employment; provided that if the Executive is provided with
health insurance coverage by a successor employer, any such coverage by the
Company shall cease (each of (1), (2) and (3) referred to as the “Severance
Payment”).  The Executive also shall be entitled to receive payment for all
reimbursable expenses or other entitlements then due and owing to the Executive
as of the Termination Date.  If the Executive breaches his obligations under
Section 1.6, 1.7, 1.8 or 1.9 of this Agreement, the Company’s obligation to make
any Severance Payments and provide any Benefits shall cease as of the date of
such breach; provided, that if the Executive cures such breach within 10 days of
receiving written notice from the Company of such breach (which notice the
Company shall provide promptly to the Executive after learning of such breach),
the Company shall promptly pay all Severance Payments not made during such
period of dispute and resume making Severance Payments and providing Benefits
promptly following such cure.
 
 
 
 
 

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(c)           Death and Disability.  In the event of the death or Disability of
the Executive, the Company shall pay the Executive his Base Salary through the
Termination Date, at the rate then in effect, and all expenses or accrued
Benefits arising prior to such termination which are payable to the Executive
pursuant to this Agreement through the Termination Date.  Executive or his
estate shall also receive the pro-rata portion of the Cash Bonus for the year in
which his employment hereunder terminates, calculated based on the number of
months Executive worked during that year (including the month in which the
termination occurs). Any other rights and benefits the Executive may have under
employee benefit plans and programs of the Company generally in the event of the
Executive’s Disability shall be determined in accordance with the terms of such
plans and programs.  In the event of Executive’s death, any rights and benefits
that the Executive’s estate or any other person may have under employee benefit
plans and programs of the Company generally in the event of the Executive’s
death shall be determined in accordance with the terms of such plans and
programs.
 
(d)           Salary and Other Payments Through Termination.  If the Executive’s
employment with the Company is terminated during the Term (i) by the Company for
Cause or (ii) by the Executive other than for Good Reason, the Executive will be
entitled to receive his Base Salary through the Termination Date, but will not
be entitled to receive any Severance Payments or Benefits after the Termination
Date.  The Executive shall be entitled to receive payment for all reimbursable
expenses or other entitlements then due and owing to the Executive as of the
Termination Date.
 
(e)           Other Rights.  Except as set forth in this Section 1.4 and Section
1.3, all of the Executive’s rights to receive Base Salary, Benefits and Cash
Bonuses hereunder (if any) which accrue or become payable after the termination
of the Employment Period shall cease upon such termination.
 
(f)           Continuing Benefits. Notwithstanding Section 1.4(e), termination
pursuant to this Section 1.4 shall not modify or affect in any way whatsoever
any vested right of the Executive to benefits payable under any retirement or
pension plan or under any other employee benefit plan of the Company, and all
such benefits shall continue, in accordance with, and subject to, the terms and
conditions of such plans, to be payable in full to, or on account of, the
Executive after such termination.
 
(g)           No Duty of Mitigation.  The Executive shall not be required to
mitigate the amount of any payment provided for in this Article I by seeking
other employment or otherwise.
 
1.5           Confidential Information.
 
(a)           The Executive shall not disclose or, directly or indirectly, use
at any time, during the Employment Period or thereafter, any Confidential
Information (as defined below) of which the Executive is or becomes aware,
whether or not such information is developed by him, alone or with others,
except to the extent that (i) such disclosure or use is required by the
Executive’s performance of the duties assigned to the Executive by the Board of
Directors, (ii) the Executive is required by subpoena or similar process to
disclose or discuss any Confidential Information, provided, that in such case,
the Executive shall promptly inform the Company in writing of such event, shall
cooperate with the Company in attempting to obtain a protective order or to
otherwise limit or restrict such disclosure to the greatest extent possible, and
shall disclose only that portion of the Confidential Information as is strictly
required, or (iii) such Confidential Information is or becomes generally known
to and available for use by the public, other than as a result of any action or
inaction directly or indirectly by the Executive.  At the Company’s expense, the
Executive shall take all appropriate steps to safeguard Confidential Information
and to protect it against disclosure, misuse, espionage, loss and theft.  The
Executive acknowledges that the Confidential Information obtained by him during
the course of his employment with the Company is the sole and exclusive property
of the Company and its Subsidiaries, as applicable.
 
 
 

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(b)           The Executive understands that the Company and its Subsidiaries
will receive from third parties confidential or proprietary information (“Third
Party Information”) subject to a duty on the part of the Company and its
Subsidiaries to maintain the confidentiality of such information and to use it
only for certain limited purposes.  During the Employment Period and in the
period specified in such confidentiality agreements, and without in any way
limiting the provisions of Section 1.5(a) above, the Executive will hold Third
Party Information in confidence, consistent with the obligations applicable to
Confidential Information of the Company generally, and will not disclose to
anyone (other than personnel and agents of the Company or its Subsidiaries who
need to know such information in connection with their work for the Company or
its Subsidiaries) or use, except in connection with his work for the Company or
its Subsidiaries, Third Party Information unless expressly authorized by the
Board in writing.
 
(c)           As used in this Agreement, the term “Confidential Information”
means information that is not generally known to the public and that is related
in any way to the actual or anticipated business of the Company, its
Subsidiaries, its Affiliates or any of their respective predecessors in
interest, including but not limited to (i) business development, growth and
other strategic business plans, (ii) properties available for acquisition,
financing development or sale, (iii) accounting and business methods, (iv)
services or products and the marketing of such services and products, (v) fees,
costs and pricing structures, (vi) designs, (vii) analysis, (viii) drawings,
photographs and reports, (ix) computer software, including operating systems,
applications and program listings, (x) flow charts, manuals and documentation,
(xi) data bases, (xii) inventions, devices, new developments, methods and
processes, whether patentable or unpatentable and whether or not reduced to
practice, (xiii) copyrightable works, (xiv) all technology and trade secrets,
(xv) confidential terms of material agreements and customer relationships, and
(xvi) all similar and related information in whatever form or
medium.  Confidential Information also expressly excludes Executive’s general
know-how and business contacts contained in Executive’s rolodex, be it
electronic or otherwise,as of the Effective Date  to the extent that the use of
such information does not violate or breach the terms of Section 1.9.
 
1.6           Inventions and Patents.  Executive acknowledges that all
discoveries, concepts, ideas, inventions, innovations, improvements,
developments, products, methods, processes, techniques, programs, designs,
analyses, drawings, reports, patents, copyrightable works and mask works
(whether or not including any Confidential Information) and all issuances,
registrations or applications related thereto, all other proprietary information
or intellectual property and all similar or related information (whether or not
patentable) conceived, developed, contributed to, made, or reduced to practice
by Executive (either alone or with others) while employed by Company or any of
its Subsidiaries or Affiliates or any of their respective predecessors in
interest (including prior to the date of this Agreement) and within the scope of
the Executive’s employment and duties and responsibilities or using the
materials, facilities or resources of the Company or any of its Subsidiaries or
Affiliates or any of their respective predecessors in interest within the scope
of the Executive’s employment and duties and responsibilities (collectively,
“Company Works”) is the sole and exclusive property of the Company and its
Subsidiaries. Executive hereby assigns all right, title and interest in and to
all Company Works to the Company and its Subsidiaries and waives any moral
rights he may have therein, without further obligation or consideration.  Any
copyrightable work prepared in whole or in part by the Executive will be deemed
“a work made for hire” under Section 201(b) of the 1976 Copyright Act, and the
Company and its Subsidiaries shall own all of the rights comprised in the
copyright therein.  The Executive shall promptly and fully disclose in writing
all Company Works to the Company and shall cooperate with the Company and its
Subsidiaries to protect, maintain and enforce the Company’s and its
Subsidiaries’ interests in and rights to such Company Works (including, without
limitation, providing reasonable assistance in securing patent protection and
copyright registrations and executing all affidavits, assignments,
powers-of-attorney and other documents as reasonably requested by the Company,
whether such requests occur prior to or after termination of the Executive’s
employment with the Company).
 
 
 

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1.7           Delivery of Materials Upon Termination of Employment.  As
requested by the Company from time to time and in any event upon the termination
of the Executive’s employment with the Company , the Executive shall promptly
deliver to the Company, or at the Company’s election, destroy, all copies and
embodiments, in whatever form or medium, of all Confidential Information,
Company Works and other property and assets of the Company and its Subsidiaries
in the Executive’s possession or within his control (including, but not limited
to, office keys, access cards, written records, notes, photographs, manuals,
notebooks, documentation, program listings, flow charts, magnetic media, disks,
diskettes, tapes computers and handheld devices (including all software, files
and documents thereon) and any other materials containing any Confidential
Information or Company Works) irrespective of the location or form of such
material and, if requested by the Company, shall provide the Company with
written confirmation that all such materials have been delivered to the Company
or destroyed, as applicable.
 
1.8           Non-Compete and Non-Solicitation Covenants.
 
(a)           The Executive acknowledges and agrees that the Executive’s
services to the Company and its Subsidiaries are unique in nature and that the
Company and its Subsidiaries would be irreparably damaged if the Executive were
to provide similar services to any Person competing with the Company and its
Subsidiaries or engaged in the Business.  The Executive further acknowledges
that, in the course of his employment with the Company, he will become familiar
with the Company’s and its Subsidiaries’ trade secrets and with other
Confidential Information.  During the Noncompete Period, he shall not, directly
or indirectly, whether for himself or for any other Person, permit his name to
be used by or participate in any business or enterprise (including, without
limitation, any division, group or franchise of a larger organization) that
engages or proposes to engage in the Business in the Restricted Territories,
other than the Company and its Subsidiaries or except as otherwise directed or
authorized by the Board.  For purposes of this Agreement, the term “participate
in” shall include, without limitation, having any direct or indirect interest in
any Person, whether as a sole proprietor, owner, stockholder, partner, member,
joint venturer, creditor or otherwise, or rendering any direct or indirect
service or assistance to any Person (whether as a director, officer, supervisor,
employee, agent, consultant or otherwise).  Nothing herein will prohibit the
Executive from mere passive ownership of not more than five percent (5%) of the
outstanding stock of any class of a publicly held corporation whose stock is
traded on a national securities exchange or in the over-the-counter market.  As
used herein, the phrase “mere passive ownership” shall include voting or
otherwise granting any consents or approvals required to be obtained from such
Person as an owner of stock or other ownership interests in any entity pursuant
to the charter or other organizational documents of such entity, but shall not
include, without limitation, any involvement in the day-to-day operations of
such entity.
 
 
 

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(b)           During the Nonsolicitation Period, the Executive will not
directly, or indirectly through another Person, solicit, induce or attempt to
induce any customer, supplier, licensee, or other business relation of the
Company or any of its Subsidiaries, or solicit, induce or attempt to induce any
person who is, or was during the then-most recent 12-month period, a corporate
officer, general manager or other employee of the Company or any of its
Subsidiaries to terminate such employee’s employment with the Company or any of
its Subsidiaries, or hire any such person unless such person’s employment was
terminated by the Company or any of its Subsidiaries, or in any way interfere
with the relationship between any such customer, supplier, licensee, employee or
business relation and the Company or any of its Subsidiaries.  The restrictions
of this Section 1.8(b) shall not apply to any customer, supplier, licensee, or
other business relation of the Company or any of its Subsidiaries with whom
Executive had a prior business relationship before he started performing
services for the Company. The Executive acknowledges and agrees that the Company
and its Subsidiaries would be irreparably damaged if the Executive were to
breach any of the provisions contained in this Section 1.8(b).
 
(c)           Executive acknowledges that this Agreement, and specifically, this
Section 1.8, does not preclude Executive from earning a livelihood, nor does it
unreasonably impose limitations on Executive’s ability to earn a living.  In
addition, Executive agrees and acknowledges that the potential harm to the
Company of its non-enforcement outweighs any harm to Executive of its
enforcement by injunction or otherwise.
 
1.9           Enforcement.  If, at the time of enforcement of Section 1.5, 1.6,
1.7, 1.8, 1.9 or 1.10, a court holds that the restrictions stated herein are
unreasonable under circumstances then existing, the Parties agree that, to the
extent permitted by applicable law, the maximum period, scope or geographical
area reasonable under such circumstances will be substituted for the Noncompete
Period, scope or area.  Because the Executive’s services are unique and because
the Executive has access to Confidential Information and Company Works, the
Parties agree that money damages may be an inadequate remedy for any breach of
Section 1.5, 1.6, 1.7, 1.8, 1.9 or 1.10.  Therefore, in the event of a breach or
threatened breach of Section 1.5, 1.6, 1.7, 1.8, 1.9 or 1.10, the Company or any
of its Subsidiaries or any of their respective successors or assigns may, in
addition to other rights and remedies existing in their favor, apply to any
court of competent jurisdiction for specific performance and/or injunctive or
other relief in order to enforce, or prevent any violations of, the provisions
hereof (without posting a bond or other security).  The Parties hereby
acknowledge and agree that (a) performance of the services of the Executive
hereunder may occur in jurisdictions other than the jurisdiction whose law the
Parties have agreed shall govern the construction, validity and interpretation
of this Agreement, (b) the law of the  State of New York shall govern
construction, validity and interpretation of this Agreement to the fullest
extent possible, and (c) Section 1.5, 1.6, 1.7, 1.8, 1.9 or 1.10 shall restrict
the Executive only to the extent permitted by applicable law.
 
 
 

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1.10           Survival.  Sections 1.5, 1.6, 1.7, 1.8, 1.9 and 1.10 will survive
and continue in full force in accordance with their terms notwithstanding any
termination of the Employment Period.
 
ARTICLE II
DEFINED TERMS
 
2.1           Definitions. For purposes of this Agreement, the following terms
will have the following meanings:
 
 “Business” means the business of acquiring and licensing consumer brands
worldwide.
 
“Cause” means with respect to the Executive, the occurrence of one or more of
the following:  (i) conviction of a felony involving moral turpitude,
misappropriation of Company property, embezzlement of Company funds, violation
of the securities laws or dishonesty, (ii) the willful and continued failure by
the Executive to attempt in good faith to substantially perform his obligations
under this Agreement (other than any such failure resulting from the Executive’s
incapacity due to a Disability); (iii) reporting to work under the influence of
alcohol or illegal drugs, or the use of illegal drugs (whether or not at the
workplace), or (iv) any willful breach of Sections 1.6, 1.7, 1.8 or 1.9 of this
Agreement.  Notwithstanding the foregoing, termination by the Company for Cause
(other than pursuant to clause (i) above) shall not be effective until and
unless Executive fails to cure such alleged act or circumstance within 30 days
of receipt of notice thereof, to the satisfaction of the Chief Executive Officer
in the exercise of his reasonable judgment (or, if within such 30-day period the
Executive commences and proceeds to take all reasonable actions to effect such
cure, within such reasonable additional time period (no longer than 60 days) as
may be necessary).
 
“Closing Date” means September 29, 2011.
 
“Code” means the Internal Revenue Code of 1986 and the Treasury regulations
thereunder, each as amended from time to time.
 
“Disability” shall have the meaning set forth in a policy or policies of
long-term disability insurance, if any, the Company obtains for the benefit of
itself and/or its employees.  If there is no definition of “disability”
applicable under any such policy or policies, if any, then the Executive shall
be considered disabled due to mental or physical impairment or disability,
despite reasonable accommodations by the Company and its Subsidiaries, to
perform his customary or other comparable duties with the Company or its
Subsidiaries immediately prior to such disability for a period of at least 120
consecutive days or for at least 180 non-consecutive days in any 12-month
period.
 
 
 

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“Effective Date” means September 16, 2011.
 
“Fiscal Year” means the fiscal year of the Company and its Subsidiaries.
 
“Good Reason” means the occurrence, without the Executive’s written consent, of
one or more of the following events:  (i) the Company reduces the amount of
Executive’s Base Salary or Cash Bonus, (ii) the Company requires that the
Executive relocate his principal place of employment to a site that is more than
50 miles from the Company’s offices in the New York area  or if the Company
changes the location of its headquarters without the consent of Executive to a
location that is more than 50 miles from such location, (iii) the Company
materially reduces the Executive’s authority, duties or responsibilities or
removes the Executive from the position of President and Chief Operating Officer
of IMB other than pursuant to a termination of his employment for Cause, or upon
the Executive’s death or Disability, (iv) the failure or unreasonable delay of
the Company to provide to the Executive any of the payments or benefits
contemplated hereby or (v) the Company otherwise materially breaches the terms
of this Agreement; provided that no such event shall constitute Good Reason
hereunder unless (a) the Executive shall have given written notice to the
Company of the Executive’s intent to resign for Good Reason within 30 days after
the Executive becomes aware of the occurrence of any such event, which notice
shall describe in reasonable detail the event or events constitute the basis for
the Executive’s intention to resign for Good Reason and (b) such event or
occurrence, if a breach susceptible to cure, shall not have been cured or
otherwise shall not have been resolved to the Executive’s reasonable
satisfaction, in each case within 30 days of the Company’s receipt of such
notice.  In such case the Executive’s resignation shall become effective on the
31st day after the Company’s receipt of the aforementioned notice.
 
“Merger Agreement” means the Merger Agreement entered into by and among
NetFabric Holdings, Inc., the Company and a subsidiary of NetFabric Holdings,
Inc. formed for the purpose of acquiring the Company.
 
“Noncompete Period” means the Employment Period and 6 months thereafter.
 
“Nonsolicitation Period” means the Employment Period and 6 months thereafter.
 
“Person” means an individual, a partnership, a corporation, a limited liability
company, an association, a joint stock company, a trust, a joint venture, an
unincorporated organization, or the United States of America any other nation,
any state or other political subdivision thereof, or any entity exercising
executive, legislative, judicial, regulatory or administrative functions of
government.
 
“Restricted Territories” means (i) the United States and its territories and
possessions and (ii) any foreign country in which the Company engages in
Business as of the Termination Date.
 
“Subsidiary” means, with respect to any Person, any corporation, limited
liability company, partnership, association, or business entity of which (i) if
a corporation, a majority of the total voting power of shares of stock entitled
(without regard to the occurrence of any contingency) to vote in the election of
directors, managers, or trustees thereof is at the time owned or controlled,
directly or indirectly, by that Person or one or more of the other Subsidiaries
of that Person or a combination thereof, or (ii) if a limited liability company,
partnership, association, or other business entity (other than a corporation), a
majority of  partnership or other similar ownership interest thereof is at the
time owned or controlled, directly or indirectly, by that Person or one or more
Subsidiaries of that Person or a combination thereof.  For purposes hereof, a
Person or Persons shall be deemed to have a majority ownership interest in a
limited liability company, partnership, association, or other business entity
(other than a corporation) if such Person or Persons shall be allocated a
majority of limited liability company, partnership, association, or other
business entity gains or losses or shall be or control any managing director or
general partner or manager or managing member of such limited liability company,
partnership, association, or other business entity.  For purposes hereof,
references to a “Subsidiary” of any Person shall be given effect only at such
times that such Person has one or more Subsidiaries, and, unless otherwise
indicated, the term “Subsidiary” refers to a Subsidiary of the Company.
 
 
 

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“Termination Date” means the effective date of the Executive’s termination of
employment with the Company.
 
 
2.2
Other Definitional Provisions.

 
(a)           Section references contained in this Agreement are references to
sections in this Agreement, unless otherwise specified.  Each defined term used
in this Agreement has a comparable meaning when used in its plural or singular
form.  Each gender-specific term used in this Agreement has a comparable meaning
whether used in a masculine, feminine or gender-neutral form.
 
(b)           Whenever the term “including” (whether or not that term is
followed by the phrase “but not limited to” or “without limitation” or words of
similar effect) is used in this Agreement in connection with a listing of items
within a particular classification, that listing will be interpreted to be
illustrative only and will not be interpreted as a limitation on, or an
exclusive listing of, the items within that classification.
 

 
ARTICLE III
MISCELLANEOUS TERMS
 
3.1                 Defense of Claims. The Executive agrees that, during the
Employment Period, and for a period of six months after termination of the
Executive’s employment, upon request by the Company, the Executive shall
reasonably cooperate with the Company in connection with any matters the
Executive worked on during his employment with the Company and any related
transitional matters.  In addition, during the Employment Period and thereafter,
the Executive agrees to reasonably cooperate with the Company in the defense of
any claims or actions that may be made by or against the Company that affect the
Executive’s prior areas of responsibility or involve matters about which the
Executive has knowledge, except if the Executive’s reasonable interests are
adverse to the Company in such claim or action and provided that after the
Employment Period such level of cooperation shall be reasonable and shall take
due account of the Executive’s work and personal commitments. The Company’s
request for “reasonable cooperation” shall take into consideration Executive’s
personal and business commitments and the amount of notice provided to Executive
by the Company. The Company agrees to promptly reimburse the Executive for all
of the Executive’s reasonable travel and other direct expenses incurred, or to
be reasonably incurred, to comply with the Executive’s obligations under this
Section 3.1.
 
 
 

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3.2                 Nondisparagement. The Executive agrees to refrain from (i)
making, directly or indirectly, any derogatory comments concerning the Company
or its Subsidiaries or any current or former officers, directors, employees or
shareholders thereof or (ii) taking any other action with respect to the Company
or its Subsidiaries which is reasonably expected to result, or does result in,
damage to the business or reputation of the Company, its Subsidiaries or any of
its current or former officers, directors, employees or shareholders.  The
Company agrees to refrain from (i) making, directly or indirectly, any
derogatory comments concerning the Executive or (ii) taking any other action
with respect to the Executive which is reasonably expected to result, or does
result in, damage to the reputation of the Executive.  Notwithstanding anything
to the contrary contained herein, nothing in this Agreement shall prohibit or
restrict either party from, truthfully and in good faith: (i) making any
disclosure of information required by law; (ii) providing information to, or
testifying or otherwise assisting in any investigation or proceeding brought by,
any federal regulatory or law enforcement agency or legislative body, any
self-regulatory organization, or the Company’s or the Executive’s designated
legal, compliance or human resources officers; or (iii) filing, testifying,
participating in or otherwise assisting in a proceeding relating to an alleged
violation of any federal, state or municipal law relating to fraud, or any rule
or regulation of the Securities and Exchange Commission or any self-regulatory
organization.
 
3.3                 Source of Payments. All payments provided under this
Agreement, other than payments made pursuant to a plan which provides otherwise
and except as otherwise provided herein, shall be paid in cash from the general
funds of the Company, and no special or separate fund shall be established, and
no other segregation of assets shall be made, to assure payment. The Executive
shall have no right, title or interest whatsoever in or to any investments which
the Company or its Subsidiaries may make to aid the Company in meeting its
obligations hereunder. To the extent that any person acquires a right to receive
payments from the Company hereunder, such right shall be no greater than the
right of an unsecured creditor of the Company.
 
3.4                 Notices. Any notice provided for in this Agreement must be
in writing and must be either personally delivered, mailed by first class mail
(postage prepaid and return receipt requested), sent by reputable overnight
courier service (charges prepaid) or sent by facsimile (with receipt confirmed)
to the recipient at the address or facsimile number indicated below:
 
To the Company:
 
Xcel Brands, Inc.
5 Penn Plaza
Suite 2335
New York, New York 10001

 
 

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With copies to:
 
Blank Rome LLP
The Chrysler Building
405 Lexington Avenue
New York, NY 10174-0208
(212) 885-5001
Attn:  Robert Mittman, Esq.

 
To the Executive:
 
Joe Falco
35 Cambridge Drive
Smithtown, NY 11787
Home: 631.382.2467

With copies to:

Outten & Golden LLP
3 Park Avenue, 29th Floor
New York, NY 10016
(212) 245-1000
Attn:  Wendi S. Lazar, Esq.

or such other address or to the attention of such other Person as the recipient
Party will have specified by prior written notice to the sending Party.  Any
notice under this Agreement will be deemed to have been given when so delivered
or sent.
 
3.5                 Severability.  Subject to the express provisions of Section
1.10 relating to certain specified changes, whenever possible, each provision of
this Agreement will be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement is held to be
invalid, illegal or unenforceable in any respect under any applicable law or
rule in any jurisdiction, such invalidity, illegality or unenforceability will
not affect any other provision or any other jurisdiction, but this Agreement
will be reformed, construed and enforced in such jurisdiction as if such
invalid, illegal or unenforceable provision had never been contained herein.
 
3.6                 Complete Agreement.  This Agreement embodies the complete
agreement and understanding among the Parties with regard to the subject matter
hereof and supersedes and preempts any prior understandings, agreements or
representations by or among the Parties, written or oral, which may have related
to the subject matter hereof in any way.  To the extent that this Agreement
provides greater benefits to the Executive or fewer obligation of the Executive
than available or set forth under the Company’s employee handbook or other
corporate policies, then this Agreement shall prevail.
 
 
 

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3.7                 Counterparts.  This Agreement may be executed in separate
counterparts, each of which is deemed to be an original and all of which taken
together constitute one and the same agreement.
 
3.8                 Assignment.  Without the Executive’s consent, the Company
may not assign its rights and obligations under this Agreement except (i) to a
“Successor” (as defined below) or (ii) to an entity that is formed and
controlled by the Company or any of its Subsidiaries.  This Agreement is
personal to the Executive, and the Executive shall not have the right to assign
the Executive’s interest in this Agreement, any rights under this Agreement or
any duties imposed under this Agreement, nor shall the Executive have the right
to pledge, hypothecate, transfer, assign or otherwise encumber the Executive’s
right to receive any form of compensation hereunder without the prior written
consent of the Board.  As used in Section 3.8 and 3.9, “Successor” shall include
any Person that at any time, whether by purchase, merger or otherwise, directly
or indirectly acquires all or substantially all of the assets of, or ownership
interests in, the Company and its Subsidiaries.
 
3.9                 Successors and Assigns.  This Agreement is intended to bind
and inure to the benefit of and be enforceable by the Company, the Executive,
and their respective heirs, successors and permitted assigns.
 
3.10                 Choice of Law.  This Agreement and the performance of the
parties hereunder shall be governed by the internal laws (and not the law of
conflicts) of the State of New York. Any claim or controversy arising out of or
in connection with this Agreement, or the breach thereof, shall be adjudicated
exclusively by the Supreme Court, New York County, State of New York, or by a
federal court sitting in Manhattan in New York City, State of New York. The
parties hereto agree to the personal jurisdiction of such courts and agree to
accept process by regular mail in connection with any such dispute.
 
3.11                 Waiver of Jury Trial.  AS A SPECIFICALLY BARGAINED FOR
INDUCEMENT FOR EACH OF THE PARTIES HERETO TO ENTER INTO THIS AGREEMENT (AFTER
HAVING THE OPPORTUNITY TO CONSULT WITH COUNSEL), EACH PARTY HERETO EXPRESSLY
WAIVES THE RIGHT TO TRIAL BY JURY IN ANY LAWSUIT OR PROCEEDING RELATING TO OR
ARISING IN ANY WAY FROM THIS AGREEMENT OR THE MATTERS CONTEMPLATED HEREBY.
 
3.12                 Legal Fees and Court Costs.  In the event that any action,
suit or other proceeding in law or in equity is brought to enforce the
provisions of this Agreement, and such action results in the award of a judgment
for money damages or in the granting of any injunction in favor of the Company,
all expenses (including reasonable attorneys’ fees) of the Company in such
action, suit or other proceeding shall be paid by the Executive. In the event
that any action, suit or other proceeding in law or in equity is brought to
enforce the provisions of this Agreement, and such action results in the award
of a judgment for money damages or in the granting of any injunction in favor of
the Executive, all expenses (including reasonable attorneys’ fees and travel
expenses) of the Executive in such action, suit or other proceeding shall be
paid by the Company.
 
 
 

--------------------------------------------------------------------------------

 
 
3.13                 Remedies.  Each Party will be entitled to enforce its
rights under this Agreement specifically, to recover damages and costs caused by
any breach of any provision of this Agreement and to exercise all other rights
existing in its favor.  Subject to Section 3.12, nothing herein shall prohibit
any arbitrator or judicial authority from awarding attorneys’ fees or costs to a
prevailing Party in any arbitration or other proceeding to the extent that such
arbitrator or authority may lawfully do so.
 
3.14                 Amendment and Waiver.  The provisions of this Agreement may
be amended or waived only with the prior written consent of the Company and the
Executive, and no course of conduct or failure or delay in enforcing the
provisions of this Agreement will affect the validity, binding effect or
enforceability of this Agreement.
 
3.15                 Third Party Beneficiaries.  This Agreement will not confer
any rights or remedies upon any Person other than the Parties and their
respective successors and permitted assigns and other than, in the event of the
Executive’s death, his estate, to which all of Executive’s rights and remedies
set forth herein shall accrue.
 
3.16                 The Executive’s Representations.  The Executive hereby
represents and warrants to the Company that (a) the execution, delivery and
performance of this Agreement by the Executive do not and shall not conflict
with, breach, violate or cause a default under any contract, agreement,
instrument, order, judgment or decree to which the Executive is a party or by
which he is bound, (b) the Executive is not a party to or bound by any
employment agreement, noncompete agreement or confidentiality agreement with any
other Person (or other agreement with any other person containing a restriction
on the Executive’s right to do business or obligating him to do business with
any other Person on a priority or preferential basis), (c) upon the execution
and delivery of this Agreement by the Company, this Agreement shall be the valid
and binding obligation of the Executive, enforceable in accordance with its
terms and (d) upon the execution and delivery of this Agreement by the Company,
Executive shall not be in violation of clause (i) set forth in the definition of
Cause and shall not be disabled.
 
3.17                 Section 409A of the Code.
 
(a)           Compliance.  Notwithstanding anything herein to the contrary, this
Agreement is intended to be interpreted and applied so that the payments and
benefits set forth herein either shall either be exempt from the requirements of
Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), or
shall comply with the requirements of Code Section 409A, and, accordingly, to
the maximum extent permitted, this Agreement shall be interpreted to be exempt
from or in compliance with Code Section 409A.  To the extent that the Company
determines that any provision of this Agreement would cause Executive to incur
any additional tax or interest under Code Section 409A, the Company shall be
entitled to reform such provision to attempt to comply with or be exempt from
Code Section 409A through good faith modifications.  To the extent that any
provision hereof is modified in order to comply with Code Section 409A, such
modification shall be made in good faith and shall, to the maximum extent
reasonably possible, maintain the original intent and economic benefit to
Executive and the Company without violating the provisions of Code Section 409A.
 
 
 

--------------------------------------------------------------------------------

 
 
(b)           Separate Payments.  Notwithstanding anything in this Agreement to
the contrary, the right to receive installment payments hereunder shall be
treated as a right to receive a series of separate payments in accordance with
Code Section 409A and Final Treasury Regulation Section 1.409A-2(b)(2)(iii).
 
(c)           Short-Term Deferral.  Except as otherwise specifically provided,
amounts payable under this Agreement, other than those expressly payable on a
deferred or installment basis, will be paid as promptly as practicable following
the date on which they are earned and vested and, in any event, on or prior to
March 15 of the year following the first calendar year in which such amounts are
no longer subject to a substantial risk of forfeiture, as such term is defined
in Section 409A of the Code.
 
(d)           Separation from Service.  Notwithstanding anything in this
Agreement or elsewhere to the contrary, a termination of employment shall not be
deemed to have occurred for purposes of any provision of this Agreement
providing for the payment of any amounts or benefits that constitute
“non-qualified deferred compensation” within the meaning of Code Section 409A
upon or following a termination of Executive’s employment unless such
termination is also a “separation from service” within the meaning of Code
Section 409A and, for purposes of any such provision of this Agreement,
references to a “termination,” “termination of employment” or like terms shall
mean “separation from service” and the date of such separation from service
shall be the Termination Date for purposes of any such payment or benefits.
 
(e)           No Designation.  In no event may Executive, directly or
indirectly, designate the calendar year of any payment to be made under this
Agreement or otherwise which constitutes a “deferral of compensation” within the
meaning of Code Section 409A.
 
(f)           Expense Reimbursement. With regard to any provision herein that
provides for reimbursement of costs and expenses or in-kind benefits, except as
permitted by Code Section 409A, (i) the right to reimbursement or in-kind
benefits shall not be subject to liquidation or exchange for another benefit,
(ii) the amount of expenses eligible for reimbursement, or in-kind benefits,
provided during any taxable year shall not affect the expenses eligible for
reimbursement, or in-kind benefits to be provided, in any other taxable year,
and (iii) such payments shall be made on or before the last day of Executive’s
taxable year following the taxable year in which the expense was incurred.
 

 
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[SIGNATURE PAGE FOLLOWS]
 
 
 

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

 
Xcel Brands, Inc.
                       
By:
/s/ Robert W. D’Loren
   
 
Name:
Robert W. D’Loren
   
 
Title:
Chairman and CEO
               
/s/ Giuseppe Falco
   
Giuseppe Falco
 

 

 

 
 

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EXHIBIT A
 
FORM OF RELEASE
 

 
I, Giuseppe Falco, on behalf of myself and my heirs, successors and assigns, in
consideration of the performance by Xcel Brands, Inc., a Delaware corporation
(together with its Subsidiaries, the “Company”), of its material obligations
under the Employment Agreement, dated as of July XX, 2011 (the “Agreement”), do
hereby release and forever discharge as of the date hereof the Company, its
Affiliates, each such Person’s respective successors and assigns and each of the
foregoing Persons’ respective present and former directors, officers, partners,
stockholders, members, managers, agents, representatives, employees (and each
such Person’s respective successors and assigns) (collectively, the “Released
Parties”) to the extent provided below.
 
1.           I understand that any payments or benefits paid or granted to me
under Section 1.4(b) of the Agreement represent, in part, consideration for
signing this General Release and are not salary, wages or benefits to which I
was already entitled.  I understand and agree that I will not receive the
payments and benefits specified in Section 1.4(b) of the Agreement unless I
execute this General Release and do not revoke this General Release within the
time period permitted hereafter or breach this General Release.
 
2.           I knowingly and voluntarily release and forever discharge the
Company and the other Released Parties from any and all claims, controversies,
actions, causes of action, cross-claims, counter-claims, demands, debts,
compensatory damages, liquidated damages, punitive or exemplary damages, other
damages, claims for costs and attorneys’ fees, or liabilities of any nature
whatsoever in law and in equity, both past and present (through the date of this
General Release), whether under the laws of the United States or another
jurisdiction and whether known or unknown, suspected or claimed against the
Company or any of the Released Parties which I, my spouse, or any of my heirs,
executors, administrators or assigns, have or may have, which arise out of or
are connected with my employment with, or my separation from, the Company
(including, but not limited to, any allegation, claim or violation, arising
under:  Title VII of the Civil Rights Act of 1964, as amended; the Civil Rights
Act of 1991; the Age Discrimination in Employment Act of 1967, as amended
(including the Older Workers Benefit Protection Act); the Equal Pay Act of 1963,
as amended; the Americans with Disabilities Act of 1990; the Family and Medical
Leave Act of 1993; the Civil Rights Act of 1866, as amended; the Worker
Adjustment Retraining and Notification Act; the Employee Retirement Income
Security Act of 1974; any applicable Executive Order Programs; the Fair Labor
Standards Act; Occupational Safety and Health Act of 1970, as amended, under the
Worker Adjustment and Retraining Notification Act of 1988, as amended, under the
Family and Medical Leave Act of 1993, as amended, under the Fair Credit
Reporting Act of 1970, as amended, and under the Sarbanes-Oxley Act of 2002,
under the Civil Rights Act of 1870, 42 U.S.C. § 1981, as amended, under the
Civil Rights Act of 1871, as amended, under the Americans With Disabilities Act
of 1990, as amended, under the Americans with Disabilities Act Amendments of
2008, under the Rehabilitation Act of 1973, as amended, under the Immigration
Reform and Control Act of 1986, as amended, under the Vietnam Era Veterans
Readjustment Assistance Act of 1974, as amended, under the Uniformed Service
Employment and Reemployment Rights Act of 1994, as amended, under the
Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), and any and
all claims under the New York State Human Rights Law, under the New York City
Human Rights Law,  and under the New York Labor Laws, and any and all claims
under any other federal, state, or local labor law, civil rights law, fair
employment practices law, human rights law, family and medical leave law,
occupational safety and health law, whistleblower protection law, and equal pay
law; or any and all claims of slander, libel, defamation, invasion of privacy,
intentional or negligent infliction of emotional distress, intentional or
negligent misrepresentation, fraud, prima facie torts or other tort; or any and
all claims based on the design or administration of any of the Company’s
employee benefit plan or program, or arising under any Company policy, practice,
or procedure, or employee benefit plan; any and all claims for wages,
commissions bonuses, vacation pay or other paid time off, employee benefits
equity-based compensation, or other compensation or payments of any kind or
nature, or for continued employment with the Company in any position; or under
any other local, state, or federal law, regulation or ordinance; or under any
public policy, contract or tort, or under common law; or any claim for wrongful
discharge, breach of contract, or infliction of emotional distress; or any claim
for costs, fees, or other expenses, including attorneys’ fees incurred in these
matters) (all of the foregoing collectively referred to herein as the “Claims”);
provided, however, that nothing contained in this General Release shall apply
to, or release the Company from, (i) any obligation of the Company contained in
the Agreement to be performed after the date hereof or (ii) any vested or
accrued benefits pursuant to any employee benefit plan, program or policy of the
Company.
 
 
 

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3.           I represent that I have made no assignment or transfer of any
right, claim, demand, cause of action, or other matter covered by paragraph 2
above.
 
4.           I agree that this General Release does not waive or release any
rights or claims that I may have under the Age Discrimination in Employment Act
of 1967 which arise after the date I execute this General Release.  I
acknowledge and agree that my separation from employment with the Company in
compliance with the terms of the Agreement shall not serve as the basis for any
claim or action (including, without limitation, any claim under the Age
Discrimination in Employment Act of 1967).
 
5.           In signing this General Release, I acknowledge and intend that it
shall be effective as a bar to each and every one of the Claims hereinabove
mentioned or implied. I expressly consent that this General Release shall be
given full force and effect according to each and all of its express terms and
provisions, including those relating to unknown and unsuspected Claims
(notwithstanding any state statute that expressly limits the effectiveness of a
general release of unknown, unsuspected and unanticipated Claims), if any, as
well as those relating to any other Claims hereinabove mentioned or implied. I
acknowledge and agree that this waiver is an essential and material term of this
General Release and that without such waiver the Company would not have agreed
to the terms of the Agreement.  I covenant that I shall not directly or
indirectly, commence, maintain or prosecute or sue any of the Released Persons
either affirmatively or by way of cross-complaint, indemnity claim, defense or
counterclaim or in any other manner or at all on any Claim covered by this
General Release.  I further agree that in the event I should bring a Claim
seeking damages against the Company, or in the event I should seek to recover
against the Company in any Claim brought by a governmental agency on my behalf,
this General Release shall serve as a complete defense to such Claims. I further
agree that I am not aware of any pending charge or complaint of the type
described in paragraph 2 as of the execution of this General Release.
 
6.           I agree that neither this General Release, nor the furnishing of
the consideration for this General Release, shall be deemed or construed at any
time to be an admission by the Company, any Released Party or myself of any
improper or unlawful conduct.
 
 
 

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7.           I agree that this General Release is confidential and agree not to
disclose any information regarding the terms of this General Release, except to
my immediate family and any tax, legal or other counsel I have consulted
regarding the meaning or effect hereof or as required by law, and I will
instruct each of the foregoing not to disclose the same to anyone.
 
8.           Any non-disclosure provision in this General Release does not
prohibit or restrict me (or my attorney) from responding to any inquiry about
this General Release or its underlying facts and circumstances by the Securities
and Exchange Commission, the National Association of Securities Dealers, Inc. or
any other self-regulatory organization or governmental entity.
 
9.           Without limitation of any provision of the Agreement, I hereby
expressly re-affirm my obligations under Sections 1.5, 1.6, 1.7, 1.8, 1.9, 1.10
and 3.1.
 
10.           Whenever possible, each provision of this General Release shall be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this General Release is held to be invalid, illegal or
unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability shall not affect
any other provision or any other jurisdiction, but this General Release shall be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been contained herein.
 
“Affiliate” means, with respect to any Person, any Person that controls, is
controlled by or is under common control with such Person or an Affiliate of
such Person.
 
“Person” means an individual, a partnership, a limited liability company, a
corporation, an association, a joint stock company, a trust, a joint venture, an
unincorporated organization, investment fund, any other business entity and a
governmental entity or any department, agency or political subdivision thereof.
 
“Subsidiary” means, with respect to any Person, any corporation, limited
liability company, partnership, association, or business entity of which (i) if
a corporation, a majority of the total voting power of shares of stock entitled
(without regard to the occurrence of any contingency) to vote in the election of
directors, managers, or trustees thereof is at the time owned or controlled,
directly or indirectly, by that Person or one or more of the other Subsidiaries
of that Person or a combination thereof, or (ii) if a limited liability company,
partnership, association, or other business entity (other than a corporation), a
majority of  partnership or other similar ownership interest thereof is at the
time owned or controlled, directly or indirectly, by that Person or one or more
Subsidiaries of that Person or a combination thereof.  For purposes hereof, a
Person or Persons shall be deemed to have a majority ownership interest in a
limited liability company, partnership, association, or other business entity
(other than a corporation) if such Person or Persons shall be allocated a
majority of limited liability company, partnership, association, or other
business entity gains or losses or shall be or control any managing director or
general partner of such limited liability company, partnership, association, or
other business entity.
 
 
 

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BY SIGNING THIS GENERAL RELEASE, I REPRESENT AND AGREE THAT:
 
(a)           I HAVE READ IT CAREFULLY;
 
(b)           I UNDERSTAND ALL OF ITS TERMS AND KNOW THAT I AM GIVING UP
IMPORTANT RIGHTS, INCLUDING BUT NOT LIMITED TO, RIGHTS UNDER THE AGE
DISCRIMINATION IN EMPLOYMENT ACT OF 1967, AS AMENDED, TITLE VII OF THE CIVIL
RIGHTS ACT OF 1964, AS AMENDED; THE EQUAL PAY ACT OF 1963, THE AMERICANS WITH
DISABILITIES ACT OF 1990; AND THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED;
 
(c)           I VOLUNTARILY CONSENT TO EVERYTHING IN IT;
 
(d)           I HAVE BEEN ADVISED TO CONSULT WITH AN ATTORNEY (VIA THE AGREEMENT
AND THIS RELEASE) BEFORE EXECUTING IT AND I HAVE DONE SO OR, AFTER CAREFUL
READING AND CONSIDERATION, I HAVE CHOSEN NOT TO DO SO OF MY OWN VOLITION;
 
(e)           I HAVE HAD AT LEAST 21 DAYS FROM THE DATE OF MY RECEIPT OF THIS
RELEASE SUBSTANTIALLY IN ITS FINAL FORM ON _______________ __, _____ TO CONSIDER
IT AND THE CHANGES MADE SINCE THE _______________ __, _____ VERSION OF THIS
RELEASE ARE NOT MATERIAL AND WILL NOT RESTART THE REQUIRED 21-DAY PERIOD;
 
(f)           THE CHANGES TO THE AGREEMENT SINCE _______________ ___, _____
EITHER ARE NOT MATERIAL OR WERE MADE AT MY REQUEST.
 
(g)           I UNDERSTAND THAT I HAVE SEVEN DAYS AFTER THE EXECUTION OF THIS
RELEASE TO REVOKE IT AND THAT THIS RELEASE SHALL NOT BECOME EFFECTIVE OR
ENFORCEABLE UNTIL THE EIGHTH DAY FOLLOWING EXECUTION OF THE AGREEMENT;
 
(h)           I ACKNOWLEDGE THAT MY acceptance of any of the monies paid by the
COMPANY as described in sections __ of the employment Agreement, at any time
more than seven days after the execution of this Agreement will constitute an
admission by ME that I did not revoke this Agreement during the revocation
period of seven days; and will further constitute an admission by ME that this
Agreement has become effective and enforceable.
 
 
 

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(i)           I HAVE SIGNED THIS GENERAL RELEASE KNOWINGLY AND VOLUNTARILY AND
WITH THE ADVICE OF ANY COUNSEL RETAINED TO ADVISE ME WITH RESPECT TO IT; AND
 
(j)           I AGREE THAT THE PROVISIONS OF THIS GENERAL RELEASE MAY NOT BE
AMENDED, WAIVED, CHANGED OR MODIFIED EXCEPT BY AN INSTRUMENT IN WRITING SIGNED
BY AN AUTHORIZED REPRESENTATIVE OF THE COMPANY AND BY ME.
 
DATE: ___________ __, ______
______________________________
 
Giuseppe Falco

 
Acknowledged and agreed as of the date first written above:
 
 Xcel Brands, Inc.
 

By:
      
Name:
Robert W. D’Loren
   
Title:
Chairman & CEO
 

 

 

 

 
 
 

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