Exhibit 10.1

 

Severance Agreement

 

This Severance Agreement (the “Agreement”) is made and entered into as of
December 16, 2008, by and between Whitney Information Network, Inc., a Colorado
corporation (the “Company”) and Anne Donoho (the “Employee”).

 

Recitals

 

WHEREAS, the Employee is presently the Chief Financial Officer of the Company;
and

 

WHEREAS, the Company has previously committed verbally to the Employee that she
will be provided with certain severance benefits in the event she is terminated
from her employment with the Company other than for cause or in connection with
a change in control, and the parties wish to set forth the terms and conditions
for such severance as set forth in this Agreement;

 

NOW, THEREFORE in consideration of the mutual covenants and promises of the
parties, the Company and Employee covenant and agree as follows:

 

1.                Definitions

 

For purposes of this Agreement, the following terms have the following meanings:

 

(a)     “Termination for Cause” means termination by Company of Employee’s
employment (i) by reason of Employee’s willful dishonesty towards, fraud upon,
or deliberate injury or attempted injury to the Company, or (ii) by reason of
Employee’s gross negligence or intentional misconduct with respect to the
performance of Employee’s duties; provided, however, that no such termination
will be deemed to be a Termination for Cause unless the Company has provided
Employee with written notice of what it reasonably believes are the grounds for
any Termination for Cause and Employee fails to take appropriate remedial
actions during the 30 day period following receipt of such written notice.

 

(b)     “Termination Other Than For Cause” means termination by the Company of
Employee’s employment by the Company for reasons other than those which
constitute Termination for Cause.

 

(c)     “Voluntary Termination” means termination by the Employee of the
Employee’s employment with the Company.

 

(d)     “Change in Control” shall mean the occurrence of one of the following
events after the date of this Agreement:

 

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(1)        Any individual, entity or group (within the meaning of Section
13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, (an “Acquiring
Person”) shall acquire voting securities of the Company and immediately
thereafter is a beneficial owner (within the meaning of Rule 13d-3 promulgated
under the Securities Exchange Act of 1934) of 50% or more of either (i) the then
outstanding shares of common stock of the Company or (ii) the combined voting
power of the then outstanding voting securities of the Company entitled to vote
generally in the election of directors (the “Outstanding Company Voting
Securities”); provided, however, that an Acquiring Person shall not include the
Company, any employee benefit plan of the Company, or any person or entity
organized, appointed or established by the Company for or pursuant to the terms
of any such plan; or

 

(2)        The shareholders of the Company approve a merger or consolidation of
the Company with any other corporation, and the merger or consolidation has been
consummated, other than a merger or consolidation which would result in the
voting securities of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity or any parent corporation (within
the meaning of Section 424(e) of the Code) of such surviving entity) at least a
majority of the Outstanding Company Voting Securities, such surviving entity or
the parent corporation of such surviving entity outstanding immediately after
such merger or consolidation; or

 

(3)         The shareholders of the Company approve a plan of reorganization
(other than a reorganization under the United States Bankruptcy Code) or
complete liquidation of the Company or an agreement for the sale or disposition
by the Company of all or substantially all of the Company’s assets, and the
Company has taken the first substantive step pursuant to the plan of
reorganization or complete liquidation or the sale or disposition has been
consummated.

 

2.             Severance Compensation

 

2.1          Termination Other Than for Cause or In Connection With a Change in
Control

 

In the event Employee’s employment is terminated by the Company in a Termination
Other Than for Cause or in connection with a Change in Control, subject to
compliance with the provisions of this Agreement, Employee will be paid as
severance pay Employee’s base salary for the period commencing on the date that
Employee’s employment is terminated and ending on the date which is twelve (12)
months thereafter. Payments will be made on the same schedule that Employee’s
base salary was being paid as of the termination date. In addition, if Employee
is receiving severance pay pursuant to this Agreement, Employee shall remain
eligible to participate in all employee benefit plans to the extent maintained
by the Company for former employees of the Company,

 

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including any life, disability, health, accident and other insurance programs,
subject in each case to the generally applicable terms and conditions of the
plan or program in question and to the determinations of any committee
administering such plan or program. The provision of health and other applicable
medical benefits may be fulfilled, at the Company’s option, through Employee’s
election of continuation coverage pursuant to COBRA (the Consolidated Omnibus
Budget Reconciliation Act) and the Company’s payment of her COBRA premiums for
the period during which Employee receives severance pay.

 

2.2          Other Termination

 

In the event of a Voluntary Termination or Termination for Cause, Employee will
not be entitled to any severance pay or other benefits as set forth in this
Agreement.

 

2.3          Compliance with Internal Revenue Code Section 409A

 

(a)          It is the intention of both the Company and Employee that the
benefits and rights to which Employee could be entitled pursuant to this
Agreement comply with Section 409A of the Internal Revenue Code and the Treasury
Regulations and other guidance promulgated or issued thereunder
(“Section 409A”), to the extent that the requirements of Section 409A are
applicable thereto, and the provisions of this Agreement shall be construed in a
manner consistent with that intention. If Employee or the Company believes, at
any time, that any such benefit or right that is subject to Section 409A does
not so comply, it shall promptly advise the other and shall negotiate reasonably
and in good faith to amend the terms of such benefits and rights such that they
comply with Section 409A (with the most limited possible economic effect on
Employee and on the Company).

 

(b)          If and to the extent required to comply with Section 409A, no
payment or benefit required to be paid under this Agreement on account of
termination of Employee’s employment shall be made unless and until Employee
incurs a “separation from service” within the meaning of Section 409A.

 

(c)          If Employee is a “specified employee,” then no payment or benefit
that is payable on account of Executive’s “separation from service”, as that
term is defined for purposes of Section 409A, shall be made before the date that
is six months after Executive’s “separation from service” if and to the extent
that such payment or benefit constitutes deferred compensation (or may be
nonqualified deferred compensation) under Section 409A and such deferral is
required to comply with the requirements of Section 409A. Any payment or benefit
delayed by reason of the prior sentence shall be paid out or provided in a
single lump sum at the end of such required delay period in order to catch up to
the original payment schedule. For purposes of this Section 2.3, Employee shall
be considered to be a “specified employee” if, at the time of her “separation
from service,” Employee is a “key employee”, within the meaning of
Section 416(i) of the Internal Revenue Code, of the Company (or any person or
entity with whom the

 

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Company would be considered a single employer under Section 414(b) or
Section 414(c) of the Code).

 

(d)          Neither the Company nor Employee, individually or in combination,
may accelerate any payment or benefit that is subject to Section 409A, except in
compliance with Section 409A and the provisions of this Agreement, and no amount
that is subject to Section 409A shall be paid prior to the earliest date on
which it may be paid without violating Section 409A.

 

(e)          For purposes of applying the provisions of Section 409A to this
Agreement, each separately identified amount to which Employee is entitled under
this Agreement shall be treated as a separate payment. In addition, to the
extent permissible under Section 409A, any series of installment payments under
this Agreement shall be treated as a right to a series of separate payments.

 

2.4          Conditions

 

Employee’s receipt of severance pay and any of the other benefits set forth in
this Agreement shall be subject to (a) the receipt and continued effectiveness
of an instrument of release in the standard form used by the Company, and
(b) Employee’s compliance with that certain Confidentiality, Non-Compete and
Non-Solicitation Agreement dated December 4, 2006 executed by Employee and the
Company. In addition, as a condition to receiving any benefits provided under
this Agreement, Employee shall execute such documents and provide such
assistance, cooperation, consultation, and information as the Company may
reasonably request from time to time with respect to matters affecting or
related to the Employee and in which Employee was involved or has knowledge,
including, but not limited to, governmental investigations, contracts,
litigation, and financial matters.

 

2.5          Term

 

Employee’s right to and receipt of severance pay and other benefits, on the
terms and subject to the conditions set forth in this Agreement, and all of the
other provisions of this Agreement, shall automatically expire on December 4,
2010.

 

3.             Miscellaneous

 

3.1          Entire Agreement; Modification

 

This Agreement represents the entire understanding among the parties with
respect to the subject matter of this Agreement, and this Agreement supersedes
any and all prior understandings, agreements, plans, and negotiations, whether
written or oral, with respect to the subject matter hereof. All modifications to
this Agreement must be in writing and signed by the party against whom
enforcement of such modification is sought.

 

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3.2          Notice

 

All notices and other communications under this Agreement must be in writing and
must be given by personal delivery, telecopier or telegram, or first class mail,
certified or registered with return receipt requested, and will be deemed to
have been duly given upon receipt if personally delivered, four days after
mailing, if mailed, or two hours after transmission, if delivered by telecopier
or telegram, to the respective persons named below:

 

If to Company:

Whitney Information Network, Inc.

 

1612 E. Cape Coral Parkway

 

Cape Coral, Florida 33904

 

Attn: General Counsel

 

 

If to Employee:

Anne Donoho

 

[address on file at Company]

 

Any party may change such party’s address for notices by notice duly given
pursuant to this Section.

 

3.3             Headings

 

The Section headings of this Agreement are intended for reference and may not by
themselves determine the construction or interpretation of this Agreement.

 

3.4                 Governing Law

 

This Agreement is to be governed by and construed in accordance with the laws of
the State of Florida applicable to contracts entered into and wholly to be
performed within the State of Florida by Florida residents. Venue will be in
Lee, Broward, Dade or Palm Beach counties at the sole discretion of the Company.

 

3.5                    Survival and Assignment

 

This Agreement will be binding on, and inure to the benefit of, the executors,
administrators, heirs, successors, and assigns of the parties; provided,
however, that except as expressly provided in this Agreement, this Agreement may
not be assigned either by Company or by Employee.

 

3.6              Withholdings

 

All sums payable to Employee under this Agreement will be reduced by all
federal, state, local, and other withholdings and similar taxes and payments
required by applicable law.

 

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first above written.

 

 

 

Whitney Information Network, Inc.

 

 

 

 

 

/s/ Charles M. Peck

 

Charles M. Peck

 

Chief Executive Officer

 

 

 

 

 

/s/ Anne Donoho

 

Anne Donoho

 

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