SEPARATION AGREEMENT AND GENERAL RELEASE

 

THIS SEPARATION AGREEMENT AND GENERAL RELEASE (this “Agreement”) is dated as of
November 15, 2016, by and between PATRICK R. MCNAMEE (“Executive”); and HEALTH
INSURANCE INNOVATIONS, INC., a Delaware corporation (the “Company”). The Company
and Executive are hereinafter collectively referred to as the “parties.”
Provided the Executive has not revoked this Agreement, it is effective the
eighth day after Executive signs it (the “Effective Date”).

 

RECITALS

 

A. Executive is employed by the Company pursuant to an Employment Agreement
dated June 8, 2015, as amended by a First Amendment to Employment Agreement,
dated November 9, 2015, and a Second Amendment to Employment Agreement, dated
July 20, 2016 (collectively, the “Employment Agreement”).

 

B. Executive and the Company desire to hereby set forth the terms and conditions
upon which the Employment Agreement shall be terminated and sets forth other
matters relating to Executive’s departure from the Company.

 

NOW THEREFORE, in consideration of the mutual promises set forth herein and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties, intending to be legally bound, do hereby agree
as follows:

 

TERMS

 

1. Recitals; Certain Definitions. The Recitals are true and correct and are
incorporated into this Agreement. Capitalized terms appearing in this Agreement
and not otherwise defined herein shall have the meanings set forth in the
Employment Agreement.

 

2. Termination of Employment. Company hereby accepts Executive’s resignation
from employment with the Company as of, and the Company and Executive hereby
agree that Executive’s employment with the Company will terminate as of, the
close of business on November 15, 2016 (the “Termination Date”). The Company and
Executive hereby agree that the Employment Agreement is terminated effective as
of the Termination Date, and except for the continuing obligations described in
Section 6 below and as described in Section 15 below, neither Company nor
Executive shall have any further rights, obligations, or duties under the
Employment Agreement as of the Termination Date. In addition, Executive hereby
resigns, effective as of the date hereof, from all corporate offices and
directorships Executive holds with Company and any subsidiary or affiliate of
the Company, including without limitation Executive’s positions as Chief
Executive Officer of Company and as a member of the Board of Directors of
Company. Executive agrees that Executive’s resignation is not a “Resignation for
Good Reason” within the meaning of the Employment Agreement.

 

   

 

 

3. Purpose of this Agreement. This Agreement sets forth the terms and conditions
regarding the termination of Executive’s employment with the Company.
Furthermore, Executive recognizes and agrees that this Agreement sets forth all
consideration and/or compensation to which Executive is entitled in connection
with Executive’s employment with the Company and the termination thereof, and
that, except as specifically set forth herein, Executive has no right to any
further compensation and/or consideration from the Company. No revision or
modification hereof shall be binding unless the same is in writing and signed by
both parties. Executive acknowledges that some or all of the consideration paid
pursuant to this Agreement is more than Executive would otherwise be legally
entitled to receive and that such consideration is adequate consideration for
the agreements and covenants contained herein.

 

4. Consideration. Provided that Executive signs this Agreement and does not
revoke it, the Company agrees to make the following payments to Executive
pursuant to the terms and conditions set forth below, and Executive will be
entitled to no other payments or benefits:

 

a. Executive shall receive the Accrued Salary (as defined in the Employment
Agreement) on the next regular payroll date during which the Accrued Salary
would otherwise be payable, net of required tax and other withholdings.
Executive shall be entitled to the amount set forth in the preceding sentence
whether or not he revokes this Agreement.

 

b. Executive shall receive post-termination compensation in the amount and in
accordance with the terms set forth in Section 4(b)(iii)(C) of the Employment
Agreement, net of applicable tax withholdings and other required withholdings
(with the Termination Date herein being deemed to be the “Termination Date” for
purposes of said Section 4(b)(iii)(C)).

 

c. Executive shall be entitled to an additional payment equal to $453,750 in
lieu of accrued bonus, such payment to be made within fifteen (15) days of the
Effective Date, net of applicable tax withholdings and other required
withholdings.

 

5. Equity Awards. As of the date of this Agreement, Executive holds 300,000 SARs
pursuant to a Stock Appreciation Rights Award Agreement dated June 8, 2015,
425,000 SARs pursuant to a Stock Appreciation Rights Award Agreement dated
November 9, 2015, 125,000 SARs pursuant to a Stock Appreciation Rights Award
Agreement dated May 25, 2016, and 172,090 SARs pursuant to a Stock Appreciation
Rights Award Agreement dated June 8, 2016 (collectively, the “McNamee SARs”).
The Company agrees that the McNamee SARs shall be treated in the manner
described in Section 4(b)(iii)(E) of the Employment Agreement, provided that the
McNamee SARs shall otherwise continue to be governed by the terms and conditions
of the LTI Plan and the applicable award agreements (including the provisions
for expiration of awards set forth therein).

 

6. Survival of Certain Obligations. Notwithstanding the termination of the
Employment Agreement, the obligations, covenants, and restrictions set forth in
Section 5 of the Employment Agreement (as well as any other sections of the
Employment Agreement that relate to the enforcement or interpretation of said
sections) shall continue to remain in full force in effect at all times
hereafter and after the Termination Date in accordance with and subject to the
terms and provisions of such sections.

 

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7. Non-Disparagement. Executive and the Company agree that neither will make any
oral or written statements or communications that disparage Executive or the
Company, its officers, directors, employees, attorneys and agents, or that
otherwise impugn or are reasonably likely to impugn the reputation of you or the
Company, its officers, directors, employees, attorneys and agents and which
statement(s) has a tendency to harm its reputation by lowering it in the
estimation of the community or deterring others from associating or dealing with
it, unless required by law. This includes but is not limited to statements in
print, broadcast, electronic or social media of any kind.

 

8. No Claim for Additional Compensation or Injury. Executive agrees that
Executive has been paid all amounts owed to Executive under the Fair Labor
Standards Act (“FLSA”), that Executive has received all FMLA leave to which
Executive is entitled and that none of Executive’s rights under the FLSA and
FMLA have been violated. Executive also represents that Executive is not aware
of any conduct that Executive believes would constitute fraud, any accounting or
financial improprieties, or any conduct that would be unlawful under
Sarbanes-Oxley, Dodd-Frank, or any other similar statute or Company policy.
Executive agrees that Executive has not suffered any on the job injury for which
Executive has not already filed a claim.

 

9. Release and Waiver of Claims. In exchange for the Company’s execution of this
Agreement and Executive’s receipt of the consideration set forth in Section 4
hereof, Executive agrees to and hereby does release and discharge the Company
and its parent, subsidiary and affiliated companies, and their respective
owners, agents, employees, directors, officers and all their predecessors,
successors and assigns (the “Released Parties”), from any and all claims, causes
of action, damages, demands and recoveries of any kind, whether known or
unknown, which Executive has, ever has had, or ever in the future may have and
which are based on acts or omissions occurring up to and including the date of
this Agreement, including, without limitation, any and all claims, causes of
action, damages, demands and recoveries arising out of or relating to
Executive’s employment with the Company and the termination thereof; provided
that Executive does not waive any nonwaivable claims for whistleblowing,
unemployment compensation or workers’ compensation benefits, if applicable.
Included within the release set forth in the preceding sentence, without
limiting its scope, are claims arising under Title VII of the Civil Rights Act
of 1964, as amended, the Family Medical Leave Act of 1993, as amended (“FMLA”),
or the Age Discrimination in Employment Act of 1967, as amended (“ADEA”), or the
Worker Adjustment and Retraining Notification Act of 1989, as amended, or the
Executive Retirement Income Security Act, or the Americans with Disabilities
Act, as amended, Sarbanes-Oxley, Dodd-Frank and any waivable laws governing
whistle-blowing or retaliation, or any other federal, state or local civil
rights or employment law and/or contract or tort law. This includes but is not
limited to the Florida Civil Rights Act of 1992, the Florida Private Sector
Whistleblowing law, Florida laws related to wage payment (F.S. §448.08), Florida
Equal Pay Law, Florida Minimum Wage Act, laws related to worker compensation
retaliation (F.S. §440.205). Executive does not waive claims under workers’
compensation laws (except for F.S. §440.205), unemployment compensation or
reeemployment assistance or that may arise after the date this Agreement is
executed. This release also covers and includes claims for breach of contract
(express or implied), wrongful discharge, detrimental reliance, defamation,
emotional distress or compensatory or punitive damages, and any claim for
attorney’s fees, costs, disbursements and/or the like. Executive understands
that this Agreement releases all claims based on facts or omissions occurring on
or before the date of this Agreement, even if Executive does not, at the time
Executive signs this Agreement, have knowledge of those facts or omissions.

 

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10. Challenge to Enforceability. Executive agrees not to challenge the
enforceability of any provision of this Agreement in any court of competent
jurisdiction or arbitration, except as to validity under the ADEA. Executive
understands that nothing contained in this Agreement limits Executive’s ability
to file a charge or complaint with the Equal Employment Opportunity Commission,
the National Labor Relations Board, the Occupational Safety and Health
Administration, the Securities and Exchange Commission or any other federal,
state or local governmental agency or commission (“Government Agencies”).
Executive further understands that this Agreement does not limit Executive’s
ability to communicate with any Government Agencies or otherwise participate in
any investigation or proceeding that may be conducted by any Government Agency,
including providing documents or other information, without notice to the
Company. This Agreement does not limit Executive’s right to receive an award for
information provided to any Government Agencies. Nothing in this Agreement shall
prevent Executive’s participation in any legal proceedings against the Company
or any Released Party in compliance with a summons that requires such
participation, or Executive’s initiation of or participation in administrative
proceedings or investigations of the EEOC or other governmental agencies;
provided, however, that this Agreement shall prevent Executive from receiving
any monetary or financial damages or recoveries from the Company or any Released
Party or reinstatement with the Company in connection with any such proceedings
or investigations which is not based on recovering or receiving an award paid by
a Government Agency. Executive represents that Executive has not filed or
asserted any claims whatsoever against the Company or any Released Party.
Executive is not aware of any conduct by the Company or any Released Party that
may violate any federal, state or local law, rule or regulation.

 

11. Defend Trade Secrets Act Disclaimer.

 

a. Nothing in this Agreement is intended to discourage or restrict Executive
from reporting any theft of trade secrets pursuant to the Defend Trade Secrets
Act of 2016 (the “DTSA”) or other applicable state or federal law. The DTSA
prohibits retaliation against an employee because of whistleblower activity in
connection with the disclosure of trade secrets, so long as any such disclosure
is made either (i) in confidence to an attorney or a federal, state, or local
government official and solely to report or investigate a suspected violation of
the law, or (ii) under seal in a complaint or other document filed in a lawsuit
or other proceeding.

 

b. If Executive believes that any employee or any third party has
misappropriated or improperly used or disclosed trade secrets or Confidential
Information, Executive should report such activity to the Company’s Chief
Financial Officer. This Agreement is in addition to and not in lieu of any
obligations to protect the Company’s trade secrets and Confidential Information
which otherwise exist. Nothing in this Agreement shall limit, curtail or
diminish the Company’s statutory rights under the DTSA, any applicable state law
regarding trade secrets or common law.

 

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12. Governing Law; Venue. This Agreement shall be subject to and governed by the
laws of the State of Florida, without giving effect to the principles of
conflicts of law under Florida law that would require or permit the application
of the laws of a jurisdiction other than the State of Florida and irrespective
of the fact that the parties now or at any time may be residents of or engage in
activities in a different state. Executive agrees that in the event of any
dispute or claim arising under this Agreement, jurisdiction and venue shall be
vested and proper, and Executive hereby consents to the jurisdiction of any
court sitting in Tampa, Florida, including the United States District Court for
the Middle District of Florida.

 

13. Legal Fees. In the event of any controversy arising under or relating to the
interpretation or implementation of this Agreement, or the breach thereof, the
prevailing party will be entitled to attorneys’ fees and costs for any trial and
appellate proceedings.

 

14. Entire Agreement. This Agreement incorporates the entire understanding among
the parties with respect to the subject matter hereof. In reaching the
agreements in this Agreement, neither party has relied upon any representation
or promise, oral or written, except those set forth herein. This Agreement has
been duly authorized by the parties, and duly executed on behalf of each party
by the duly authorized officers or principals and in the manner required by all
laws and regulations applicable to each such entity.

 

15. Section 409A; Recoupment. The provisions of Section 16 of the Employment
Agreement shall apply to the payments set forth in this Agreement. Section 19 of
the Employment Agreement shall survive the termination of the Employment
Agreement and shall continue to remain in full force and effect.

 

16. Counterpart Signatures. This Agreement may be executed in one or more
counterparts, and by the parties in separate counterparts, each of which when
executed shall be deemed to be an original but all of which taken together shall
constitute one and the same agreement. The parties further agree that facsimile
signatures or signatures scanned into .pdf (or similar) format and sent by
e-mail shall be deemed original signatures.

 

17. Assignment. This Agreement shall be binding upon and inure solely to the
benefit of each party identified herein, and nothing in this Agreement, express
or implied, is intended to or shall confer upon any other person any right,
benefit or remedy of any nature whatsoever under or by reason of this Agreement.
The Company may assign this Agreement to any successors (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to the business
and/or assets of the Company.

 

18. Confidentiality. So long as no party to this Agreement has a reasonable
basis to believe that another party to this Agreement is violating or preparing
to violate the terms of this Agreement, except as required by any governmental
or quasi-governmental entity (including but not limited to required filings with
the Securities and Exchange Commission), the parties agree that this Agreement,
its terms and provisions and all correspondence and discussions related to this
Agreement, shall be kept privileged and strictly confidential by each party from
the date hereof into the future; provided, however, (a) Executive may disclose
this information to her immediate family, tax advisors and accountants and (b)
the Company shall be permitted to advise any party it believes to be a
prospective employer of Executive as to the dates of Executive’s employment with
the Company and Executive’s last position held with the Company, in accordance
with Company policy.

 

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19. Severability. In the event any provision of this Agreement shall be held
invalid or unenforceable, it shall be deemed modified, only to the extent
necessary to make it lawful. To effect such modification, the said provision
shall be deemed deleted, added to and/or rewritten, whichever shall most fully
preserve the intentions of the parties as originally expressed herein.

 

20. Voluntary Execution. Executive represents that Executive has read this
Agreement in its entirety and that Executive has had the opportunity to consult
with legal counsel prior to signing this Agreement, and that Executive is fully
aware of its contents and of its legal effect. Executive signs this Agreement of
Executive’s own free will and act, without any legal reservations, duress,
coercion or undue influence, and it is Executive’s intention that Executive be
legally bound hereby.

 

21. Period to Consider and Revoke. Executive acknowledges that Executive was
offered the opportunity to consider this Agreement for a period of twenty-one
(21) days from the time Executive received it on November 12, 2016 and is hereby
advised to review it with an attorney of Executive’s choice. This Agreement does
not become effective until seven (7) days after the date Executive signs this
Agreement and provides the Company with an original thereof. Executive can
revoke the Agreement at any time during that seven-day period (the “Revocation
Period”).

 

22. Acceptance and/or Revocation. IMPORTANT NOTICE TO EXECUTIVE: You may accept
this Agreement by signing it and returning it to the Company. You may exercise
your right to revoke your decision to sign this Agreement by sending a written
notice of revocation to the individual and address specified below by no later
than the last day of the Revocation Period:

 

Health Insurance Innovations, Inc.

Attention: Chief Financial Officer

15438 N. Florida Avenue, Suite 201

Tampa, Florida 33613

Fax: (877) 376-5832

 

If you exercise your right to revoke, your termination of employment shall be
deemed to be a “Resignation Without Good Reason” under the Employment Agreement,
in which case Executive shall only receive the compensation and benefits
described in Section 4(b)(iv) of the Employment Agreement.

 

[The next page is the signature page]

 

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IN WITNESS WHEREOF, the parties have duly executed this Separation Agreement and
General Release as of the date first written above.

 

COMPANY:       HEALTH INSURANCE INNOVATIONS, INC.       By: /s/ Michael D.
Hershberger   Name: Michael D. Hershberger   Its: Chief Financial Officer      
  EXECUTIVE:       PATRICK R. MCNAMEE       /s/ Patrick R. McNamee   Patrick R.
McNamee, individually       Date of Signature: 11/13/2016  

 

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