Exhibit 10.1

 

EXECUTION COPY

 

SEPARATION AGREEMENT

 

This SEPARATION AGREEMENT (the “Agreement”), dated as of April 19, 2018 (the
“Execution Date”) is made by and between FORM Holdings Corp. (the “Company”) and
Andrew Perlman (“Executive”).

 

WHEREAS, the Company and the Executive desire to provide for an amicable and
mutually agreed transition of executive management in accordance with the terms
and conditions of this Agreement.

 

NOW THEREFORE, in consideration of the mutual covenants and agreements set forth
herein, the parties agree as follows:

 

1.             Separation of Employment. Executive resigned his employment with
the Company effective as of the close of business on April 19, 2018 (the
“Separation Date”). As of the Separation Date, Executive further resigns from
each and every other office, position or responsibility in which Executive
served for the Company and each of its respective affiliates, subsidiaries or
divisions, including, without limitation, Executive’s position as a member of
the Board of Directors of the Company (the “Board”) and its subsidiaries.
Executive acknowledges that from and after the Separation Date, Executive shall
have no authority to, and shall not represent himself as an employee or director
of the Company. Notwithstanding anything in any applicable equity compensation
plan or applicable award agreement(s) (“Equity Documents”) to the contrary, all
outstanding stock options awarded to Executive shall terminate as of the
Separation Date.

 

2.             Separation Benefits. In exchange for the promises set forth in
this Agreement and provided that Executive executes this Agreement (including
the Release of Claims herein) and provided that this Agreement becomes
irrevocable and enforceable within sixty (60) days following the Separation
Date, the Company agrees to pay or provide to Executive the following benefits
(“Separation Benefits”):

 

(a)           Severance in an amount equal to $125,000 (the “Deferred Cash”),
payable in monthly installments of $20,833.34 over the six (6) month period
following the Settlement Date, less applicable withholdings and in accordance
with the Company’s standard payroll procedures, commencing on the first payroll
date following the Settlement Date. For purposes of this Agreement, the
“Settlement Date” means the date that the Company achieves both of the following
objectives at the end of an applicable calendar quarter as shown in the 10-Q or
10-K reporting such quarter (the “Cash Objectives”): (i) the Company’s Working
Capital exceeds $6,368,000, and (ii) Free Cash exceeds $6,368,000; provided that
if the Company does not achieve the Cash Objectives prior to the second (2nd)
anniversary of the Separation Date, the Deferred Cash shall be forfeited and no
amounts shall be payable under this Section 2(a). For purposes of this
Agreement, “Free Cash” means cash and cash equivalents as defined in the
Company’s Form 10-K and calculated consistently, less (i) any cash or cash
equivalents that are restricted in any way, and (ii) any cash received by the
Company from a debt, equity or other capital raise subsequent to the Execution
Date. For purposes of this Agreement, “Working Capital” shall mean (i) current
assets less current liabilities, prepared in accordance with GAAP and consistent
with the Company’s prior filings of Form 10-K, less (ii) any cash received by
the Company from a debt, equity or other capital raise subsequent to the
Execution Date.

 

(b)           All of the outstanding restricted stock units (“RSUs”) awarded to
Executive shall continue to be governed by the terms and conditions set forth in
the applicable Equity Documents; provided, however, that with regards to 153,301
of the shares underlying Executive’s RSUs which were awarded on January 17, 2017
(and amended on December 14, 2017) (the “Current RSUs”), such Current RSUs shall
vest on May 17, 2018 (in accordance with the January 17 , 2017 award agreement,
as amended December 14, 2017); provided, however, that such Current RSUs will be
subject to a restriction on sale until the earlier of: (i) the one (1) year
anniversary of the Separation Date; and (ii) the date upon which the volume
weighted average price (VWAP) for the XpresSpa Group Inc. common stock for
thirty (30) consecutive trading days exceeds $1.50 (as adjusted by the Company
in its discretion for any stock split, subdivision, dividend or distribution).
After applying this Section, any remaining RSUs shall be forfeited as of the
Separation Date. Executive is responsible for the payment of income and
employment taxes (and any other taxes required to be withheld) payable in
connection with the Current RSUs and the Executive agrees to remit to the
Company an amount sufficient to pay such taxes. Such payment shall be made to
the Company in a form that is reasonably acceptable to the Company, as the
Company may determine in its discretion.

 

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(c)           Immediately following the Execution Date, the Company shall grant
to Executive an additional grant of 150,000 RSUs which shall be fully vested as
of the date of grant (the “Granted RSUs”) and subject to applicable Equity
Documents; provided, however, that such Granted RSUs will be subject to a
restriction on sale until the earlier of: (i) the one (1) year anniversary of
the Separation Date; and (ii) the date upon which the volume weighted average
price (VWAP) for the XpresSpa Group Inc. common stock for thirty (30)
consecutive trading days exceeds $1.50 (as adjusted by the Company in its
discretion for any stock split, subdivision, dividend or distribution).
Executive is responsible for the payment of income and employment taxes (and any
other taxes required to be withheld) payable in connection with the Granted RSUs
and the Executive agrees to remit to the Company an amount sufficient to pay
such taxes. Such payment shall be made to the Company in a form that is
reasonably acceptable to the Company, as the Company may determine in its
discretion.

 

Executive acknowledges and agrees that the Separation Benefits provided for in
this Section 2 are good, valuable and sufficient consideration and are not
otherwise due or owing to you under the Employment Agreement between Executive
and the Company, dated January 18, 2017 (the “Employment Agreement”) or any
other Company agreement, policy or practice. Executive further acknowledges and
agrees that Executive shall have no right to any benefits or payments under
Section 9 of the Employment Agreement.

 

3.             Continuing Obligations.

 

(a)           Executive will continue to be subject to and comply with the
Non-Disclosure Agreement between Executive and the Company, dated April 29, 2007
(the “NDA”), an executed copy of which is attached hereto as Exhibit A, and the
obligations set forth in Section 10 of the Employment Agreement and that the
Executive’s obligations set forth in the NDA and Employment Agreement shall
continue to apply following the Separation Date; provided, however, that: (i)
the “Restricted Period” (as that term is defined in the Employment Agreement)
shall be the two (2) year period following the Separation Date; and (ii) the
following subsection (3) shall be added to the definition of “Restricted
Business Activity” in the Employment Agreement: “solicit or hire any
then-current employee of the Company or any individual who was an employee of
the Company within six (6) months prior to the Separation Date.”

 

(b)           The Company acknowledges and agrees that the Executive shall
continue to be covered by the Company’s directors and officers policy in
accordance with its terms and the Indemnification Agreement between Vringo, Inc.
and Executive, dated January 31, 2013 (the “Indemnification Agreement”), an
executed copy of which is attached hereto as Exhibit B, shall continue to apply
in accordance with its terms.

 

4.             Public Relations; No Disparagement.

 

(a)           The Executive will not make public statements or communications
that would libel, slander, disparage, denigrate, ridicule or criticize the
Company or any of its businesses, services, products, affiliates or current,
former or future directors and named executive officers (in their capacity as
such).

 

(b)           Similarly, the Company shall not make, or cause to be made, any
statement, observation or opinion, or communicate any information (whether oral
or written) which would or could materially disparage the Executive’s
reputation. Executive acknowledges that the “Company” in this Section 4(b)
refers to statements made by the Company’s named executive officers and the
members of the Board. The Executive acknowledges that the Company cannot control
or direct the speech of its non-managerial employees or third parties.

 

(c)           The Company shall draft a public statement addressing the
Executive’s separation from the Company which shall be provided to Executive for
review and comment prior to publication.

 

(d)           Notwithstanding anything in this Section to the contrary, this
Section shall have no application to any statement, evidence or testimony either
party is compelled to provide by any court or government agency or to any
statement the Company is required to make to comply with federal and state
securities laws.

 

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5.             Executive’s Release of Claims.

 

(a)           In consideration for the Separation Benefits, Executive,
individually and on behalf of Executive’s heirs, executors, administrators,
attorneys or representatives, successors and assigns, hereby voluntarily,
knowingly and willingly releases and forever discharges the Company and each of
its parents, subsidiaries and affiliates, together with each of the foregoing
entities’ respective owners, principals, partners, officers, directors,
employees, agents, members, managers, attorneys, employee benefits plans and
such plans’ administrators, fiduciaries, trustees, record keepers and service
providers, and each of their respective predecessors, successors, and assigns
(hereinafter collectively referred to as the “Company Releasees”) from any and
all rights, claims, charges, actions, causes of action, complaints, grievances,
sums of money, suits, debts, covenants, contracts, agreements, promises,
obligations, damages, demands or liabilities of every kind whatsoever, in law or
in equity, whether known or unknown, suspected or unsuspected (collectively,
“Claims”) which Executive or Executive’s executors, administrators, successors
or assigns ever had, now have or may hereafter claim to have by reason of any
matter, cause or thing whatsoever, arising from the beginning of time up to the
Execution Date including, but not limited to (1) any such Claims relating in any
way to Executive’s employment relationship with the Company or any other Company
Releasee, or the termination thereof, (2) any Claims arising under any agreement
between the Company and Executive (including, without limitation, the Employment
Agreement), and (3) any such Claims arising under any federal, local or state
statute or regulation, including, without limitation: the Age Discrimination in
Employment Act of 1967, as amended by the Older Workers Benefit Protection Act;
Title VII of the Civil Rights Act of 1964; the Americans with Disabilities Act
of 1990; the Lilly Ledbetter Fair Pay Act; the Genetic Information
Non-Discrimination Act; the Employee Retirement Income Security Act of 1974; the
Rehabilitation Act of 1973; the Family and Medical Leave Act of 1993, as amended
in 2009; the Civil Rights Act of 1866; the Civil Rights Act of 1872; and the
Fair Labor Standards Act; and any state or local laws governing the same subject
matter, and any other federal, state, or local law prohibiting discrimination
and/or harassment on the basis of race, color, age, religion, sexual
orientation, religious creed, sex, national origin, ancestry, alienage,
citizenship, nationality, mental or physical disability, denial of family and
medical care leave, medical condition (including cancer and genetic
characteristics), marital status, military status, gender identity, harassment
or any other basis prohibited by law; provided, however, that notwithstanding
the foregoing, nothing contained in this Section shall in any way diminish or
impair: (A) any rights Executive may have to vested benefits under employee
benefit plans; (B) Executive’s right to enforce this Agreement; (C) any Claims
Executive may have that cannot be waived under applicable law, such as
unemployment benefits, workers’ compensation and disability benefits; and (D)
any rights to indemnification as an officer, director, or employee of the
Company as provided under the Company’s organizational documents, the
Indemnification Agreement, and any insurance policies providing for such
indemnification (collectively, the “Excluded Claims”).

 

(b)           Executive represents and warrants that, except with respect to the
Excluded Claims, Company and other Company Releasees have fully satisfied any
and all obligations whatsoever owed to Executive arising out of Executive’s
employment with Company or any other Company Releasee, and that no further
payments or benefits are owed to Executive by the Company or any other Company
Releasee. Executive has reported all hours worked to the Company and has been
paid and has received all compensation, including all wages, overtime, bonuses,
incentive compensation, commissions, equity grants, benefits, sick pay, vacation
pay, or other compensation or payments or form of remuneration of any kind or
nature, as well as reimbursement for all reasonable and necessary business,
travel and entertainment expenses incurred on behalf of the Company.

 

(c)           Executive further understands and agrees that, except for the
Excluded Claims, Executive has knowingly relinquished, waived and forever
released any and all rights to any personal recovery in any action or proceeding
that may be commenced on Executive’s behalf arising out of the aforesaid
employment relationship or the termination thereof, including, without
limitation, claims for back pay, front pay, liquidated damages, compensatory
damages, general damages, special damages, punitive damages, exemplary damages,
costs, expenses and attorneys’ fees.

 

(d)           As a condition of the Company entering into this Agreement,
Executive further represents that Executive has not filed against the Company or
any of the other Company Releasees, any complaints, claims or lawsuits with any
court, administrative agency or arbitral tribunal prior to the date hereof, and
that Executive has not transferred to any other person any such complaints,
claims or lawsuits.

 

(e)           In consideration of Executive’s release of claims in Section 6(a)
and Executive’s other promises set forth in this Agreement, the Company
voluntarily, knowingly and willingly releases and forever discharges Executive
from any and all claims and rights of any nature whatsoever which the Company
now has or in the future may have against Executive, provided, however, the
foregoing release shall not waive any claims the Company may have against
Executive arising from or related to: (i) Executive’s breach of this Agreement;
(ii) Executive’s illegal or material bad faith acts; and (iii) any claims for
which Executive would not be eligible for indemnification under the
Indemnification Agreement.

 

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6.             Cooperation. Except as described in the preceding Section,
Executive agrees to reasonably cooperate with the Company in connection with any
action, suit, or proceeding, whether or not by or in the right of the Company
and whether civil, criminal, administrative, investigative or otherwise. 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 will reimburse the Executive for
reasonable out-of-pocket expenses that the Executive incurs in providing any
requested cooperation, so long as the Executive provides advance written notice
to the Company of the Executive’s request for reimbursement and provides
satisfactory documentation of the expenses.

 

7.             Whistleblower. Nothing in Sections 4, 5, or 6 shall prohibit the
Executive from reporting possible violations of law or regulation to or filing
charges with any governmental agency or entity including but not limited to the
United States Department of Justice, the Securities and Exchange Commission, the
Equal Employment Opportunity Commission, any Inspector General, or any similar
state or local agency, or making other disclosures that are protected under the
whistleblower provisions of federal law or regulation. The Executive does not
need the prior authorization of the Company to make any such reports or
disclosures and the Executive is not required to notify the Company that the
Executive has made such reports or disclosures. Executive understands that by
signing this Agreement, Executive waives the right to any monetary recovery in
connection with a local, state or federal governmental agency proceeding and
Executive waives the right to file a claim seeking monetary damages in any
court, administrative agency or arbitral tribunal. Notwithstanding the
foregoing, nothing in this Agreement prohibits Executive from seeking or
obtaining a whistleblower award from the Securities and Exchange Commission (and
not the Company Releasees) pursuant to Section 21F of the Securities Exchange
Act of 1934, as amended.

 

8.             Breach. If Executive breaches or threatens to breach any of
Executive’s promises in Sections 3, 4, 5, or 6 of this Agreement, or if any
representation made by Executive in this Agreement was false when made,
Executive agrees that the Company shall be entitled to appropriate injunctive
relief and that Executive (a) will forfeit all right to future benefits paid in
consideration for the breached promise, including, without limitation, the
Separation Benefits, and (b) must repay all benefits previously received for
such promise, including, without limitation, the Separation Benefits, upon the
Company’s demand.

 

9.             Entire Agreement and Amendment. This Agreement embodies the
entire agreement and understanding of the parties hereto in respect of the
subject matter of this Agreement. This Agreement may be amended only by a
written document signed by both parties to this Agreement.

 

10.          Governing Law. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York, excluding any conflicts
or choice of law rule or principle that might otherwise refer construction or
interpretation of the Agreement to the substantive law of another jurisdiction,
and any action brought hereunder shall be brought in a court of competent
jurisdiction in the State of New York. The Company and the Executive do hereby
submit to personal jurisdiction of the federal and state courts located in the
State of New York for purposes of any action brought hereunder.

 

11.          Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed an original, but all of which together shall constitute
one and the same instrument. This Agreement will not become effective or
enforceable until each of the Company and Executive has executed this Agreement.

 

12.          Severability. If any section, subsection or provision hereof is
found for any reason whatsoever to be invalid or inoperative, that section,
subsection or provision shall be deemed severable and shall not affect the force
and validity of any other provision of this Agreement. If any covenant herein is
determined by a count to be overly broad thereby making the covenant
unenforceable, the parties agree and it is their desire that such court shall
substitute a reasonable judicially enforceable limitation in place of the
offensive part of the covenant and that as so modified the covenant shall be as
fully enforceable as if set for the herein by the parties themselves in the
modified form.

 

13.          Notices. Any notices, requests, demands and other communications
provided for by this Agreement shall be sufficient if in writing and delivered
in person or sent by a nationally recognized overnight courier service or by
registered or certified mail, postage prepaid, return receipt requested, to the
Executive at the last address the Executive has filed in writing with the
Company or, in the case of the Company, at its main offices, attention of the
Board.

 

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14.          Warranties. By signing this Agreement, Executive acknowledges the
following:

 

(a)           Executive has carefully read and understands this Agreement.

 

(b)           The Company advised Executive to consult with an attorney,
Executive did consult with an attorney, and reviewed this Agreement in its final
form;

 

(c)           Executive understands that this Agreement is legally binding and
by signing it Executive gives up certain rights; and

 

(d)           Executive has voluntarily chosen to enter into this Agreement and
have not been forced or pressured in any way to sign it.

 

[Signature Page Follows]

 

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IN WITNESS WHEREOF the parties have executed this Agreement on the date first
set forth above.

 

  FORM HOLDINGS CORP.       By:  /s/ Bruce Bernstein   Name: Bruce Bernstein  
Title: Chairman of the Board of Directors           EXECUTIVE:       /s/ Andrew
Perlman   Andrew Perlman

 

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EXHIBIT A

 

NDA

 

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EXHIBIT B

 

INDEMNIFICATION AGREEMENT

 

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