Document:

Ex 10.5 Form of Voting Agreement with Perfumania and Parlux Directors and Officers

EXHIBIT 10.5
FORM OF VOTING AGREEMENT (PARLUX)
THIS VOTING AGREEMENT (this “Agreement”) is made and entered into as of December 23, 2011 by and between Perfumania Holdings, Inc., a Florida corporation (“Parent”) and [______________] (“Stockholder”), a stockholder of Parlux Fragrances, Inc., a Delaware corporation (the “Company”).
RECITALS
A.    Concurrently with the execution of this Agreement, Parent, PFI Merger Corp., a Delaware corporation and wholly-owned subsidiary of Parent (“Merger Sub”), and the Company are entering into an Agreement and Plan of Merger of even date herewith (as it may be amended from time to time, the “Merger Agreement”), pursuant to which, among other things, (i) the Company will merge with an into Merger Sub (the “Merger”) and (ii) except as otherwise provided in the Merger Agreement, each outstanding share of the common stock of the Company, $.01 par value per share (the “Company Common Stock”) will be converted into the right to receive the consideration set forth in the Merger Agreement.
B.    As of the date hereof, each Stockholder is the beneficial owner (as defined in Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) of such number of shares of Company Common Stock and options to purchase such number of shares of Company Common Stock as is indicated on the signature page of this Agreement.
C.    As a condition and inducement to Parent and Company to enter into the Merger Agreement, the Stockholder (in the Stockholder’s capacity as such) is hereby agreeing to vote the Shares as described herein and to take such other actions as provided for herein.
NOW, THEREFORE, in consideration of the foregoing and the mutual representations, warranties, covenants and agreements contained herein, and intending to be legally bound, the parties hereto agree as follows:
1.Certain Definitions. All capitalized terms that are used but not defined herein shall have the respective meanings ascribed to them in the Merger Agreement. For all purposes of and under this Agreement, the following terms shall have the following respective meanings:
(a)    “Expiration Date” shall mean the earliest to occur of (i) such date and time as the Merger Agreement shall have been terminated pursuant to Article 7 thereof, (ii) such date and time as the Merger shall become effective in accordance with the terms and provisions of the Merger Agreement or (iii) a Change of Recommendation.
(b)    “Shares” shall mean (i) all securities of the Company (including all shares of Company Common Stock and, to the extent transferable by their terms, all options, warrants and other rights to acquire shares of Company Common Stock) owned by the Stockholder as of the date hereof, and (ii) all additional securities of the Company (including all additional shares of Company 

Common Stock and, to the extent transferable by their terms, all additional options, warrants and other rights to acquire shares of Company Common Stock) of which the Stockholder acquires ownership during the period from the date of this Agreement through the Expiration Date (including by way of stock dividend or distribution, split-up, recapitalization, combination, exchange of shares and the like).
(c)    “Transfer” A Person shall be deemed to have effected a “Transfer” of a Share if such person directly or indirectly (i) sells, pledges, encumbers, assigns, grants an option with respect to, transfers or disposes of such Share or any interest in such Share, or (ii) enters into an agreement or commitment providing for the sale of, pledge of, encumbrance of, assignment of, grant of an option with respect to, transfer of or disposition of such Share or any interest therein.
2.    Transfer of Shares.  Except as expressly permitted by this Agreement, until the Expiration Date, Stockholder shall not directly or indirectly: (i) cause or permit any Transfer of any of the Shares of which Stockholder is the beneficial owner (x) unless each Person to which any of such Shares, or any interest in any of such Shares, is or may be transferred shall have: (A) executed a counterpart of this Agreement and a proxy in substantially the form attached hereto as Exhibit A and (B) agreed in writing to hold such Shares (or interest in such Shares) subject to all of the terms and provisions of this Agreement or (y) except by will or by operation of law, in which case this Agreement will bind the transferee; (ii) grant any proxies or powers of attorney, other than consistently with the terms of Section 3, or deposit any Shares into a voting trust or enter into a voting agreement with respect to any Shares; or (iii) take any action that would make any representation or warranty of Stockholder contained herein untrue or incorrect or have the effect of preventing or disabling Stockholder from performing any of Stockholder's obligations under this Agreement.
3.    Agreement to Vote Shares.
(a)    Until the Expiration Date, Stockholder agrees that, at every meeting of the stockholders of the Company called, and at every adjournment or postponement thereof, and on every action or approval by written consent of the stockholders of Company, Stockholder (in Stockholder’s capacity as such) shall, or shall cause the holder of record on any applicable record date to, vote the Shares:
(i)    in favor of the adoption of the Merger Agreement (as it may be amended from time to time), and in favor of each of the other actions contemplated by the Merger Agreement;
(ii)    against approval of any proposal made in opposition to, or in competition with, the Merger or any other transactions contemplated by the Merger Agreement; and
(iii)    against any of the following actions (other than those actions that relate to the Merger and any other transactions contemplated by the Merger Agreement):  (A) any merger, consolidation, business combination, sale of assets, or reorganization of the Company or any subsidiary of the Company, (B) any sale, lease or transfer of any significant part of the assets 

of the Company or any subsidiary of the Company, (C) any reorganization, recapitalization, dissolution, liquidation or winding up of the Company or any subsidiary of the Company, (D) any material change in the capitalization of the Company or any subsidiary of the Company, or the corporate structure of the Company or any subsidiary of the Company, or (E) any other action that is intended, or could reasonably be expected to, impede, interfere with, delay, postpone, discourage or adversely affect the Merger or any other transactions contemplated by the Merger Agreement.
(b)    In the event that a meeting of the stockholders of the Company is held, Stockholder shall, or shall cause the holder of record of the Shares on any applicable record date to, appear at such meeting or otherwise cause the Shares to be counted as present thereat for purposes of establishing a quorum.
(c)    Stockholder shall not enter into any agreement or understanding with any Person to vote or give instructions in any manner inconsistent with the terms of this Section 3.
(d)    Except as expressly set forth in this Section 3, Stockholder shall retain at all times the right to vote the Stockholder’s Shares in the Stockholder’s sole discretion and without any other limitation on matters that are at any time or from time to time presented for consideration to the Company’s stockholders.

4.    Agreement Not to Tender.  Until the Expiration Date, Stockholder shall not tender the Shares into any exchange or tender offer commenced by a third party other than Parent, Merger Sub or any other subsidiary of Parent.
5.    Agreement Not to Exercise Appraisal Rights.  Until the Expiration Date, Stockholder hereby waives and agrees not to exercise or assert any rights (including, without limitation, under Section 262 of the Delaware General Corporation Law) to demand appraisal of any Shares that may arise with respect to the Merger.
6.    Directors and Officers.  Notwithstanding any provision of this Agreement to the contrary, nothing in this Agreement shall (or require the Stockholders to attempt to) limit or restrict any designee of any Stockholder who is a director or officer of the Company from acting in such capacity or voting in such person’s sole discretion on any matter (it being understood that this Agreement shall apply to each Stockholder solely in such Stockholder’s capacity as a stockholder of the Company).
7.    No Ownership Interest.  Nothing contained in this Agreement shall be deemed to vest in Parent any direct or indirect ownership or incidence of ownership of or with respect to any Shares.  All rights, ownership and economic benefits of and relating to the Shares shall remain vested in and belong to the Stockholder, and Parent shall not have any authority to direct the Stockholder in the voting of any of the Shares, except as otherwise provided herein.
8.    Representations and Warranties of the Stockholder.  Stockholder hereby represents and warrants to Parent and Company as follows:
(a)    Power; Binding Agreement.  Stockholder has full power and authority to 

execute and deliver this Agreement, to perform Stockholder’s obligations hereunder and to consummate the transactions contemplated hereby.  The execution, delivery and performance by Stockholder of this Agreement, the performance by Stockholder of its obligations hereunder and the consummation by Stockholder of the transactions contemplated hereby have been duly and validly authorized by Stockholder and no other actions or proceedings on the part of  Stockholder is necessary to authorize the execution and delivery by it, him or her of this Agreement, the performance by Stockholder of its, his or her obligations hereunder or the consummation by Stockholder of the transactions contemplated hereby.  This Agreement has been duly executed and delivered by Stockholder and constitutes the valid and binding obligation of Stockholder, enforceable against Stockholder in accordance with its terms.
(b)    No Conflicts.  Except as set forth in the Merger Agreement, no filing with, and no permit, authorization, consent, or approval of, any Governmental Entity is necessary for the execution by the Stockholder of this Agreement, the performance by the Stockholder of such Stockholder’s obligations hereunder and the consummation by the Stockholder of the transactions contemplated hereby.  None of the execution and delivery by the Stockholder of this Agreement, the performance by the Stockholder of Stockholder’s obligations hereunder or the consummation by the Stockholder of the transactions contemplated hereby will (i) result in a violation or breach of, or constitute (with or without notice or lapse of time or both) a default (or give rise to any third party right of termination, cancellation, material modification or acceleration) under any of the terms, conditions or provisions of any note, loan agreement, bond, mortgage, indenture, license, contract, commitment, arrangement, understanding, agreement, or other instrument or obligation of any kind to which such Stockholder is a party or by which the Stockholder or any of the Stockholder’s properties or assets may be bound, or (ii) violate any order, writ, injunction, decree, judgment, order, statute, rule, or regulation applicable to the Stockholder or any of the Stockholder’s properties or assets.
(c)    Absence of Litigation.  As of the date hereof, there is no suit, action, investigation or proceeding pending or, to the knowledge of such Stockholder, threatened against or affecting the Stockholder that could reasonably be expected to materially impair the ability of the Stockholder to perform its, his or her obligations hereunder or to consummate the transactions contemplated hereby on a timely basis.
(d)    Ownership of Shares.  Stockholder (i) is the beneficial owner of, and has good and valid title to, the shares of Company Common Stock indicated on the signature page of this Agreement, all of which are free and clear of any Liens (except any Liens arising under securities laws or arising hereunder), (ii) is the owner of options that are exercisable for the number of shares of Company Common Stock indicated on the signature page of this Agreement, all of which options and shares of Company Common Stock issuable upon the exercise of such options are free and clear of any Liens (except any Liens arising under securities laws or arising hereunder), and (iii) does not own, beneficially or otherwise, any securities of the Company other than the shares of Company Common Stock, options to purchase shares of Company Common Stock, and shares of Company Common Stock issuable upon the exercise of such options indicated on the signature page of this Agreement.
(e)    Voting Power.  Except as noted on Schedule I attached hereto, Stockholder 

has and will have sole voting power, sole power of disposition, sole power to issue instructions with respect to the matters set forth herein, and sole power to agree to all of the matters set forth in this Agreement, in each case with respect to all of Stockholder’s Shares, with no limitations, qualifications or restrictions on such rights, subject to applicable federal securities laws and the terms of this Agreement.  Except as noted on Schedule I, there are no proxies, voting trusts or understandings to or by which Stockholder is a party or bound or that expressly requires that any of Stockholder’s Shares be voted in a specific manner other than as provided in this Agreement or that provide for any right on the part of any other person other than Stockholder to vote such Shares.  Notwithstanding anything in this Agreement to the contrary, nothing herein shall require the Stockholder to exercise any option to purchase shares of Company Common Stock.
(f)    Information.  None of the information relating to the Stockholder provided in writing by or on behalf of the Stockholder for inclusion in documents filed by Parent with the Securities and Exchange Commission (the “SEC”) will, at the respective times such information is sent or given to Parent or the Company, contain any untrue statement of material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.  The Stockholder agrees to promptly notify Parent of any required corrections with respect to any such information.
(g)    No Finder’s Fees.  No broker, investment banker, financial advisor or other person is entitled to any broker’s, finder’s, financial adviser’s or other similar fee or commission in connection with the transactions contemplated by the Merger Agreement or this Agreement based upon arrangements made by or on behalf of such Stockholder.
(h)    Reliance by Parent and Company.  Such Stockholder understands and acknowledges that both Parent and Company are entering into the Merger Agreement in reliance upon the Stockholder’s execution and delivery of this Agreement.
9.    Representations and Warranties of Parent.  Parent represents and warrants to the Stockholder as follows:
(a)    Power; Binding Agreement. Parent has full power and authority to execute and deliver this Agreement, to perform its obligations hereunder and, subject to receipt of Parent Shareholder Approval, to consummate the transactions contemplated hereby.  The execution, delivery and performance by Parent of this Agreement, the performance of its obligations hereunder and the consummation by Parent of the transactions contemplated hereby have been duly and validly authorized by Parent and no other actions or proceedings on its part is necessary to authorize the execution and delivery of this Agreement, or, subject to receipt of Parent Shareholder Approval, the performance of its obligations hereunder and the consummation by Parent of the transactions contemplated hereby.  This Agreement has been duly executed and delivered by Parent and constitutes its valid and binding obligation, enforceable against it in accordance with its terms.
(b)    No Conflicts.  Except as set forth in the Merger Agreement, no filing with, and no permit, authorization, consent, or approval of, any Governmental Entity is necessary for the execution by Parent of this Agreement, the performance by Parent of its obligations hereunder and the consummation by Parent of the transactions contemplated hereby.  None of the execution and 

delivery by Parent of this Agreement, the performance of its obligations hereunder or the consummation by Parent of the transactions contemplated hereby will (i) result in a violation or breach of, or constitute (with or without notice or lapse of time or both) a default (or give rise to any third party right of termination, cancellation, material modification or acceleration) under any of the terms, conditions or provisions of any note, loan agreement, bond, mortgage, indenture, license, contract, commitment, arrangement, understanding, agreement, or other instrument or obligation of any kind to which it is a party or by which it or any its properties or assets may be bound, or (ii) violate any order, writ, injunction, decree, judgment, order, statute, rule, or regulation applicable to it or any of its properties or assets.
10.    Certain Restrictions.  Stockholder shall not, directly or indirectly, take any action that would make any representation or warranty of the Stockholder contained herein untrue or incorrect.
11.    Disclosure.  Subject to reasonable prior notice and approval (which shall not be unreasonably withheld or delayed), Stockholder hereby authorizes Parent and Company to publish and disclose Stockholder’s identity, ownership of Shares and the nature of Stockholder’s commitments, arrangements and understandings under this Agreement in all documents and schedules filed with the Securities and Exchange Commission and any press release or other disclosure document that Parent or Company determines to be necessary or desirable in connection with the Merger and any transactions related to the Merger.
12.    Further Assurances.  Subject to the terms and conditions of this Agreement, Stockholder shall use commercially reasonable efforts to take, or cause to be taken, all actions, and to do, or cause to be done, all things necessary to fulfill Stockholder’s obligations under this Agreement.  
13.    Legending of Shares.  If so requested by Parent, Stockholder agrees that the Shares shall bear a legend stating that they are subject to this Agreement.
14.    Termination.  This Agreement shall terminate and shall have no further force or effect as of the Expiration Date.  Notwithstanding the foregoing, nothing set forth in this Section 14 or elsewhere in this Agreement shall relieve either party hereto from liability, or otherwise limit the liability of either party hereto, for any willful breach of this Agreement prior to the Expiration Date.
15.    Miscellaneous.
(a)    Validity.  The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of the other provisions of this Agreement, which will remain in full force and effect.  In the event any Governmental Entity of competent jurisdiction holds any provision of this Agreement to be null, void or unenforceable, the parties hereto shall negotiate in good faith and execute and deliver an amendment to this Agreement in order, as nearly as possible, to effectuate, to the extent permitted by law, the intent of the parties hereto with respect to such provision.
(b)    Binding Effect and Assignment.  This Agreement and all of the provisions 

hereof shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns, but neither this Agreement nor any of the rights, interests or obligations of the parties hereto may be assigned by any of the parties without the prior written consent of the others.
(c)    Amendments; Waiver.  This Agreement may be amended by the parties hereto, and the terms and conditions hereof may be waived, only by an instrument in writing signed on behalf of each of the parties hereto, or, in the case of a waiver, by an instrument signed on behalf of the party waiving compliance.
(d)    Specific Performance; Injunctive Relief.  The parties hereto acknowledge that Parent shall be irreparably harmed and that there shall be no adequate remedy at law for a violation of any of the covenants or agreements of the Stockholder set forth herein.  Therefore, it is agreed that, in addition to any other remedies that may be available to Parent upon any such violation, Parent shall have the right to enforce such covenants and agreements by specific performance, injunctive relief or by any other means available to Parent at law or in equity.
(e)    Notices.  All notices and other communications pursuant to this Agreement shall be in writing and deemed to be sufficient if contained in a written instrument and shall be deemed given if delivered personally, telecopied, sent by nationally-recognized overnight courier or mailed by registered or certified mail (return receipt requested), postage prepaid, to the parties at the following address (or at such other address for a party as shall be specified by like notice):
If to Parent:
Perfumania Holdings, Inc. 
35 Sawgrass Drive 
Suite 2 
Bellport, New York 11713  
Attn: Michael W. Katz, Chief Executive Officer and President 
Facsimile No.:  (631) 866-4231
with a copy to (which shall not constitute notice) to:
Edwards Wildman Palmer LLP 
750 Lexington Avenue 
New York, New York 10022 
Attention:  Patricia L. Kantor, Esq. 
Facsimile No.:  (212) 308-4844
If to the Stockholder:
To the respective addresses and fax numbers shown on the signature pages for each Stockholder
(f)    No Waiver.  The failure of any party hereto to exercise any right, power or 

remedy provided under this Agreement or otherwise available in respect of this Agreement at law or in equity, or to insist upon compliance by any other party with its obligation under this Agreement, and any custom or practice of the parties at variance with the terms of this Agreement, shall not constitute a waiver by such party of such party’s right to exercise any such or other right, power or remedy or to demand such compliance.
(g)    No Third Party Beneficiaries.  This Agreement is not intended to confer upon any person other than the parties hereto any rights or remedies hereunder.
(h)    Governing Law.  This Agreement shall be governed by the laws of the State of Delaware, without reference to any provision that would require the application of the laws of another jurisdiction.
(i)    Submission to Jurisdiction.  All actions and proceedings arising out of or relating to this Agreement shall be heard and determined exclusively in any Delaware state or federal court sitting in New Castle County.  The parties hereto hereby (i) submit to the exclusive jurisdiction of any state or federal court sitting in the New Castle County for the purpose of any action arising out of or relating to this Agreement brought by any party hereto, and (ii) irrevocably waive, and agree not to assert by way of motion, defense, or otherwise, in any such action, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property is exempt or immune from attachment or execution, that the action is brought in an inconvenient forum, that the venue of the action is improper, or that this Agreement or the transactions contemplated hereby may not be enforced in or by any of the above-named courts.
(j)    Rules of Construction.  The parties hereto agree that they have been represented by counsel during the negotiation and execution of this Agreement and, therefore, waive the application of any law, regulation, holding or rule of construction providing that ambiguities in an agreement or other document will be construed against the party drafting such agreement or document.
(k)    Entire Agreement.  This Agreement contains the entire understanding of the parties hereto in respect of the subject matter hereof, and supersede all prior negotiations, agreements and understandings, both written and oral, between the parties hereto with respect to the subject matter hereof.
(l)    Severability.  If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced by any rule of law, or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated herein are not affected in any manner materially adverse to any party hereto.  Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this Agreement so as to give effect to the original intent of the parties hereto as closely as possible in a mutually acceptable manner.
(m)    Interpretation.
(i)    Whenever the words “include,” “includes” or “including” are used 

in this Agreement they shall be deemed to be followed by the words “without limitation.” As used in this Agreement, the term “affiliate” shall have the meaning set forth in Rule 12b-2 promulgated under the Exchange Act.
(ii)    The article and section headings contained in this Agreement are solely for the purpose of reference, are not part of the agreement of the parties hereto and shall not in any way affect the meaning or interpretation of this Agreement.
(n)    Counterparts.  This Agreement may be executed in several counterparts, each of which shall be an original, but all of which together shall constitute one and the same agreement.

IN WITNESS WHEREOF, the undersigned have caused this Agreement to be executed by their respective duly authorized officers to be effective as of the date first above written.
        
    	
	
	PERFUMANIA HOLDINGS, INC.

	 

	By: ______________________

	Name: ____________________

	Title: _____________________

    	
	
	STOCKHOLDER:

	Name: ______________

	 

	Address:

	 

	 

	 

	 

	Share beneficially owned:

	
		
	 
	shares of Parent Common Stock

	 
	shares of Parent Common Stock issuable upon

	 
	exercise outstanding options or warrants

SCHEDULE I
EXCEPTIONS
[ ]

EXHIBIT A
IRREVOCABLE PROXY 
The undersigned stockholder (the “Stockholder”) of Parlux Fragrances, Inc., a Delaware corporation (the “Company”), hereby irrevocably (to the fullest extent permitted by law) appoints [______________] and [_____________] of Perfumania Holdings, Inc. (“Parent”), and each of them, as the sole and exclusive attorneys and proxies of the undersigned, with full power of substitution and resubstitution, to vote and exercise all voting and related rights (to the full extent that the undersigned is entitled to do so) with respect to all of the shares of capital stock of the Company that now are or hereafter may be beneficially owned by the undersigned, and any and all other shares or securities of the Company issued or issuable in respect thereof on or after the date hereof (collectively, the “Shares”) in accordance with the terms of this Irrevocable Proxy until the Expiration Date (as defined below).  Upon the undersigned’s execution of this Irrevocable Proxy, any and all prior proxies given by the undersigned with respect to any Shares are hereby revoked and the undersigned agrees not to grant any subsequent proxies with respect to the Shares until after the Expiration Date. 
This Irrevocable Proxy is irrevocable to the fullest extent permitted by law, is coupled with an interest and is granted pursuant to that certain Voting Agreement of even date herewith by and among Parent and the undersigned stockholder, and is granted in consideration of Parent entering into that certain Agreement and Plan of Merger of even date herewith (the “Merger Agreement”), among Parent, Merger Sub, a Delaware corporation and wholly-owned subsidiary of Parent (“Merger Sub”), and the Company.  The Merger Agreement provides for, among other things, (i) the Company will merge with an into Merger Sub (the “Merger”) and (ii) except as otherwise provide in the Merger Agreement, each outstanding share of the common stock of the Company, $.01 par value per share (the “Company Common Stock”) will be converted into the right to receive the consideration set forth in the Merger Agreement. 
As used herein, the term “Expiration Date” shall mean the earlier to occur of (i) such date and time as the Merger Agreement shall have been terminated pursuant to Article 7 thereof, (ii) such date and time as the Merger shall become effective in accordance with the terms and provisions of the Merger Agreement or (iii) a Change of Recommendation (as defined in the Merger Agreement). 
The attorneys and proxies named above, and each of them, are hereby authorized and empowered by the undersigned, at any time prior to the Expiration Date, to act as the undersigned’s attorney and proxy to vote the Shares, and to exercise all voting, consent and similar rights of the undersigned with respect to the Shares (including, without limitation, the power to execute and deliver written consents) at every annual, special, adjourned or postponed meeting of stockholders of the Company and in every written consent in lieu of such meeting:  (i) in favor of the adoption of the Merger Agreement, and in favor of each of the other actions contemplated by the Merger Agreement; (ii) against approval of any proposal made in opposition to, or in competition with, the Merger or any other transactions contemplated by the Merger Agreement; and (iii) against any of the following actions (other than those actions that relate to the Merger and any other transactions contemplated by the Merger Agreement):  (A) any merger, consolidation, business combination, sale of assets, or reorganization of the Company or any subsidiary of the Company, (B) any sale, 

lease or transfer of any significant part of the assets of the Company or any subsidiary of the Company, (C) any reorganization, recapitalization, dissolution, liquidation or winding up of the Company or any subsidiary of the Company, (D) any material change in the capitalization of the Company or any subsidiary of the Company, or the corporate structure of the Company or any subsidiary of the Company, or (E) any other action that is intended, or could reasonably be expected to, impede, interfere with, delay, postpone, discourage or adversely affect the Merger or any other transactions contemplated by the Merger Agreement.
The attorneys and proxies named above may not exercise this Irrevocable Proxy on any other matter.  The undersigned stockholder may vote the Shares on all other matters.
Any obligation of the undersigned hereunder shall be binding upon the successors and assigns of the undersigned.
This Irrevocable Proxy shall terminate, and be of no further force and effect, automatically upon the Expiration Date.
This Irrevocable Proxy shall be governed by the laws of the State of Delaware, without reference to rules of conflicts of law.
All actions and proceedings arising out of or relating to this Irrevocable Proxy shall be heard and determined exclusively in any Delaware state or federal court sitting in New Castle County.  The parties hereto hereby (i) submit to the exclusive jurisdiction of any state or federal court sitting in the New Castle County for the purpose of any action arising out of or relating to this Irrevocable Proxy brought by any party hereto, and (ii) irrevocably waive, and agree not to assert by way of motion, defense, or otherwise, in any such action, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property is exempt or immune from attachment or execution, that the action is brought in an inconvenient forum, that the venue of the action is improper, or that this Irrevocable Proxy or the transactions contemplated hereby may not be enforced in or by any of the above-named courts.
	
			
	PERFUMANIA HOLDINGS, INC.
	 
	SHAREHOLDER:

	By: ___________________
	 
	Name: ________________

	Name: _________________
	 
	 

	Title: __________________
	 
	 

*****IRREVOCABLE PROXY ****kl01015_ex10-1.htm

 

EXHIBIT 10.1

 

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (“Agreement”) is effective the 1st day of January, 2012 by and between DIRECT INSITE CORP., a Delaware corporation (hereinafter the "Company"), and Matthew E. Oakes, an individual residing at 1977 Gulf Shore Boulevard North, Unit 206, Naples, Florida 34102 (hereinafter referred to as "Oakes").

W I T N E S S E T H:

WHEREAS, the Company and Oakes previously entered into an employment agreement, dated January 1, 2011, as amended.

WHEREAS, the Company desires to enter into this Agreement with Oakes; and

WHEREAS, Oakes desires to enter into this Agreement with the Company;

NOW, THEREFORE, it is agreed as follows:

1.           Prior Agreements Superseded. This Agreement supersedes any services, consulting or other agreements, oral or written, entered into between Oakes and the Company prior to the date of this Agreement except for stock options and restricted stock or other equity-based awards previously granted to Oakes, which stock options and awards shall continue in full force and effect, under the terms and conditions effective when they were issued.

2.           Services.

(a)           The Company hereby agrees to employ Oakes and Oakes hereby agrees to continue serving as President and Chief Executive Officer of the Company, with commensurate responsibilities.   Oakes shall devote his full time and efforts to the business of the Company and will not engage, directly or indirectly, in any work or any trade or business, whether as a director, officer, employee, manager, partner, agent, representative or consultant, for his own account or for or on behalf of any other person, firm or corporation, other than work with charitable organizations that does not interfere with the performance of his duties hereunder in any way.

(b)           Oakes shall serve in similar capacities of such of the subsidiary corporations of the Company as may be selected by the Board without additional compensation. Notwithstanding the foregoing, it is understood that the duties of Oakes during the performance of services shall not be inconsistent with his position and titles as President and Chief Executive Officer of the Company.

(c)           Upon termination of Oakes employment for any reason, unless otherwise requested by the Board of Directors (the “Board”), Oakes shall immediately resign from all positions that he holds or has ever held with the Company and any affiliated entity, including without limitation, the Board.  Oakes hereby agrees to execute any and all documentation to effectuate the resignations from such other positions upon request by the Company.  However, he shall be treated for all purposes as having resigned from such other positions upon termination of his employment, regardless of when or whether he executes any such documentation.

 

 

 

  

  

  

 

3.           Term. Subject to earlier termination on the terms and conditions hereinafter provided, the term of this Agreement shall cover the period January 1, 2012 through and ending on December 31, 2013.  It is the intention of the Board to communicate to Oakes its intentions with respect to continuation of Oakes’s employment with the Company following conclusion of the term of this Agreement no later than June 30, 2013.

4.           Compensation. For all services rendered by Oakes under this Agreement, compensation shall be paid to Oakes as follows:

(a)           Oakes shall receive $22,917 per month ($275,000 per year) as base salary (“Base Salary”).

(b)           Oakes shall be entitled to receive an annual performance based bonus (“Annual Bonus”), consisting of a bonus based on the Company’s revenue performance (“Revenue Based Bonus”) and the Company’s EBIT performance (“EBIT Based Bonus”), as more fully set forth on Annex I.  Any Annual Bonus shall be paid not later than the thirtieth (30th) day following the completion of the audit for the fiscal year with respect to which it is earned.

(c)           The Board, or any duly authorized committee thereof, may award Oakes a discretionary bonus (“Discretionary Bonus”) based on such factors as the Board or any such committee shall deem relevant.  The Discretionary Bonus may be payable in cash or restricted stock, or any combination thereof, as the Board or any such committee shall determine.

(d)           Oakes shall be awarded stock options as follows:

(i)           Oakes shall receive stock options to acquire 360,000 shares of common stock (subject to customary adjustment for any stock split, reverse stock split, or stock dividend following the date of this Agreement).

(ii)           The exercise price of the stock options shall be $1.15 (subject to customary adjustment as aforesaid).

(iii)           The award of stock options shall vest over four years from the date of grant, with one-quarter of the stock options to vest on the first anniversary of the date of grant, and the remainder to vest in equal monthly installments through the fourth anniversary of the date of grant.

(iv)           If there shall occur a Change of Control (as defined below) of the Company and Oakes shall be terminated without “cause” or shall resign for “good reason” within six months from the date of the Change of Control, 50% of his remaining

 

 

 

  

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stock options shall vest on the date of termination or resignation; provided that if the Transaction Price (as defined below) in the Change of Control transaction is in excess of $42 million, then 100% of the remaining stock options shall vest on the date of resignation or termination as aforesaid.

 

For purposes hereof:

“Change of Control” means a merger, stock sale, asset sale or other business combination transaction as a result of which the stockholders of the Company immediately prior to the consummation of the transaction hold less than 50% of the equity interests in the entity that is the owner of the Company’s business immediately following consummation of the transaction; provided that a “Change of Control” shall not be deemed to have occurred as a result of an equity investment in the Company, in the form of  a recapitalization or otherwise for financing purposes, made with the approval of a majority of Directors.

“Transaction Price” means the consideration per share payable to the holders of shares of common stock in a Change of Control transaction multiplied by the total number of shares of common stock whose holders are entitled to receive the consideration.  If the consideration is in a form other than cash, the per share value of the consideration shall be as determined in good faith by the Board.

(e)           Upon the delivery by Oakes to the Company of supporting documentation of reasonable expenses in connection with his relocation to the Company’s headquarters in Sunrise, Florida, the Company shall reimburse Oakes for such expenses; provided that in no event shall the amount of such expenses exceed $25,000.  The Company shall continue to make lease payments on the corporate apartment located in Sunrise, Florida and utilized by Oakes through the date of termination of such lease in May 2012.

(f)           Oakes shall be entitled to fully participate in all benefit programs available to executive employees of the Company during his employment with the Company.

5.           Expenses.  Oakes shall be reimbursed for all other out-of-pocket office expenses reasonably incurred by him in the performance of his duties hereunder. All expenses due hereunder shall be paid or reimbursed to Oakes by the Company following presentation of documentation therefor.

6.           Termination of Employment. Oakes’s employment with the Company and this Agreement shall terminate upon the earliest of the following events:

(i)           Oakes’s termination of employment by the Company without “cause” (as defined below);

(ii)           Oakes’s resignation from employment with the Company for “good reason” (as defined below);

 

 

 

  

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(iii)           Oakes’s death;

(iv)           Oakes’s “disability” (as defined below);

(v)           Oakes’s termination of employment by the Company for “cause”;

(vi)           Oakes’s voluntary resignation from employment with the Company without “good reason”; or

(vii)           the non-renewal of this Agreement.

7.            Severance Benefits.

(a)           Oakes shall be entitled to the severance benefits provided for in subsection (d) hereof in the event of his termination of employment by the Company without “cause” (as defined below) or in the event of his resignation from employment with the Company for “good reason” (as defined below). In such event, Oakes shall have no duty to mitigate damages hereunder. Oakes and the Company acknowledge that the foregoing provisions of this paragraph 7 are reasonable and are based upon the facts and circumstances of the parties at the time of entering into this Agreement, and with due regard to future expectations.

(b) For purposes of this Agreement, the term “cause” shall mean:

(i)           Oakes’s willful and continued refusal to endeavor in good faith to substantially perform his duties under this Agreement (other than any such failure resulting from his incapacity due to physical or mental illness) after demand for substantial performance is delivered to Oakes by the Board which specifically identifies the manner in which the Board believes Oakes has not substantially performed his duties.

(ii)           Any arrest for fraud, embezzlement or theft, or any other crime constituting a felony, whether or not in connection with his duties or in the course of his performance as defined in this Agreement.

(iii)           Any willful disclosure by Oakes of any material confidential information or trade secrets of the Company or its affiliates.

(iv)           Any other willful breach by Oakes of the terms of this Agreement.

(v)           Any substantive discussion by Oakes with any person (other than the Board of Directors or management of the Company) concerning the sale, acquisition or other Change of Control of the Company that has not been approved in advance by the Chairman of the Board of the Company.

For purposes of this paragraph, no act or failure to act on Oakes’s part shall be considered “willful” unless done, or omitted to be done, by Oakes not in good faith and without reasonable belief that his action or omission was in the best interest of the Company. Further, any act or

 

 

 

  

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failure to act based upon authority given by the Board or the written advice of counsel to the Company shall be conclusively deemed to be done or omitted to be done by Oakes in “good faith” and in the best interest of the Company and shall not constitute “cause” for purposes of this paragraph.

Notwithstanding the foregoing, Oakes shall not be deemed to have been terminated from employment for “cause” unless and until there shall have been delivered to him a copy of a written notice of termination of employment from the Board after the Company has given reasonable written notice to Oakes detailing the specific cause events and a period of not less than thirty (30) days following receipt of such notice to cure such event and if such event is not so cured, an opportunity for Oakes with his counsel to be heard before the members of the Board finding that in the good faith opinion of such members of the Board that Oakes was guilty of the conduct set forth in clauses (i), (ii), (iii), (iv) or (v) of this paragraph and specifying the particulars thereof in detail.

(c)           For purposes of this Agreement, Oakes shall have “good reason” to terminate his employment with the Company for the following circumstances:

(i)           the Company removes Oakes from either the position of President or Chief Executive Officer;

	  	  

(ii)           material diminution in compensation as defined in paragraph 4(a) of this Agreement;

(iii)           material diminution in Oakes’s authority, duties, or responsibilities;

(iv)           material breach of this Agreement by the Company; or

(v)           material change in geographic location at which Oakes is required to perform services.

provided, however, that (x) Oakes shall have provided notice to the Company of the “good reason” condition within ninety (90) days after the initial existence of the condition, and (y) the Company shall be given at least thirty (30) days to cure such “good reason” condition.

(d)           The severance benefits to be paid to Oakes in the event of his termination of employment without “cause “or his resignation from employment for “good reason” shall be paid within thirty (30) days of receipt of the signed General Release attached as Exhibit A and after the expiration of any applicable revocation period, and shall consist of the following

(i)  an amount equal to

(x)           (I) 1.0 times his annual Base Salary, if Oakes’s termination or resignation occurs during 2012,

 

 

 

  

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(II) 1.0 times his annual Base Salary, if a Change of Control transaction shall occur and Oakes shall be terminated without “cause” or Oakes shall resign for “good reason” within six months thereafter, and otherwise

(III) his annual Base Salary payable through the remaining term of this Agreement, but in no event less than six months’ Base Salary.

(y)           COBRA coverage, at Company expense, for the number of months of severance payable under clause (x); and

(z)           to the extent necessary, an amendment to all Oakes’s stock options that have vested as of the date of termination or resignation to provide that they shall remain exercisable for a period of sixty (60) days following such date, anything to the contrary in any applicable plan or grant agreement notwithstanding; provided that all stock options and shares of restricted stock that are unvested as of such date shall be forfeited;

provided that, and as a condition to the receipt of such payments or other benefits, Oakes shall execute and deliver to the Company a General Release attached as Exhibit A; and

(ii) All Accrued Obligations.

“Accrued Obligations,” means

(w)           Base Salary through the date of termination of employment, payable on the first payroll date coincident with or next following the date of employment termination;

(x)           any unpaid Annual Bonus or pro-rated Annual Bonus that is not for a full year with respect to any fiscal year of the Company completed prior to the date of termination of employment, payable on the first payroll date coincident with or next following the date of employment termination (except that payment of unpaid Annual Bonus shall not be made upon any termination without “cause” or resignation for “good reason” if the Company shall establish that “cause” existed prior to such termination);

(y)           all accrued and vested benefits under employee pension (including 401(k)) and welfare plans in which Oakes participates, in accordance with applicable plan terms; and

(z)           unreimbursed business expenses, including those set forth in paragraph 5 of this Agreement, incurred through the termination of employment date, in accordance with the Company’s business expense reimbursement policy.

(e)           To the extent applicable, it is intended that this Agreement comply with the requirements of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), and this Agreement shall be interpreted in a manner consistent with this intent. Notwithstanding anything else contained herein to the contrary, any payment that constitutes a “deferral of

 

 

 

  

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compensation” subject to Section 409A of the Code required to be made to Oakes hereunder upon his termination of employment (including any payment pursuant to this paragraph 7) shall, if Oakes is a “specified employee” within the meaning of Section 409A of the Code at the time of such termination, be made promptly on the earlier of (i) the six month anniversary of Oakes’s date of termination of employment, and (ii) his death, in each case to the extent necessary to avoid imposition on Oakes of any tax penalty imposed under Section 409A of the Code. Amounts payable under this Agreement shall be deemed not to be a “deferral of compensation” subject to Section 409A of the Code to the extent provided in the exceptions in Treasury Regulations §§1.409A-1(b)(4) (“short-term deferrals”) and (b)(9) (“separation pay plans,” including the exception under subparagraph (iii)), other applicable provisions of Treasury Regulations §1.409A-1 through A-6, and any other applicable exceptions as may be in effect from time to time under Section 409A of the Code. Solely for purposes of determining the time and form of payments due Oakes under this Agreement (including any payments due under paragraph 7 of this Agreement or otherwise in connection with his termination of employment with the Company), Oakes shall not be deemed to have incurred a termination of employment unless and until he shall incur a “separation from service” within the meaning of Section 409A of the Code. To the extent that the Company and Oakes determine that any provision of this Agreement could reasonably be expected to result in Oakes’s being subject to the payment of interest or additional tax under Section 409A, the Company and Oakes agree, to the extent reasonably possible as determined in good faith, to amend this Agreement, retroactively, if necessary, in order to avoid the imposition of any such interest or additional tax under Section 409A of the Code in a manner that preserves Oakes’s economic interests prior to such imposition. All reimbursements and in-kind benefits provided under the Agreement shall be made or provided in accordance with the requirements of Section 409A of the Code to the extent that such reimbursements or in-kind benefits are subject to Section 409A of the Code, including, where applicable, the requirements that (i) any reimbursement is for expenses incurred during Oakes’s lifetime (or during a shorter period of time specified in this Agreement), (ii) the amount of expenses eligible for reimbursement during a calendar year may not affect the expenses eligible for reimbursement in any other calendar year, (iii) the reimbursement of an eligible expense will be made on or before the last day of the calendar year following the year in which the expense is incurred and (iv) the right to reimbursement is not subject to set off or liquidation or exchange for any other benefit.

8.             Death.            In the event of Oakes’s termination of employment due to his death, he or his estate (as the case may be) shall be entitled to—

(i)              the Accrued Obligations pursuant to paragraph 7(d)(ii) of this Agreement,

(ii)              the current year Annual Bonus, which will be paid on a pro rata basis based on annualized year-to-date results.  Pro rata refers to the number of days served by Mr. Oakes up to the employment termination date divided by the number of days in the year,

(iii)              a lump sum payment of six months’ Base Salary,

and

 

 

 

  

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         (iv)                      COBRA coverage, at Company expense, for twelve months.

All of Oakes’s Company stock options, restricted stock, and other outstanding equity based awards shall immediately cease vesting upon Oakes’s employment termination by reason of death, and all unvested awards shall be forfeited. Any prorated Annual Bonus shall be paid at such time as the bonus would have been paid hereunder had Oakes’s employment continued through the Annual Bonus payment date.

9.              Disability. In the event of Oakes’s termination of employment due to his “disability” (as defined below), he shall be entitled to

(i)              the Accrued Obligations pursuant to paragraph 7(d)(ii) of this Agreement,

(ii)              the current year Annual Bonus, which will be paid on a pro rata basis based on annualized year-to-date results. Pro rata refers to the number of days served by Mr. Oakes up to the employment termination date divided by the number of days in the year,

(iii)              a lump sum payment of six months’ Base Salary,

and

             (iv)             COBRA coverage, at Company expense, for twelve months.

All of Oakes’s Company stock options, restricted stock, and other outstanding equity based awards shall immediately cease vesting upon Oakes’s employment termination by reason of “disability,” and all unvested awards shall be forfeited.   For purposes of this Agreement, “disability” shall have the meaning set forth in Section 409A(a)(2)(C) of the Code. Any prorated Annual Bonus shall be paid at such time as the bonus would have been paid hereunder had Oakes’s employment continued through the Annual Bonus payment date.

10.           Termination for Cause or without Good Reason.  In the event of Oakes’s termination of employment by the Company for “cause” (as defined above) or Oakes’s voluntary resignation from employment with the Company without “good reason” (as defined above), Oakes shall be entitled to receive the Accrued Obligations pursuant to paragraph 7(d)(ii)(w), 7(d)(ii)(y) and 7(d)(ii)(z) of this Agreement.

11.           Non-Renewal of Agreement. In the event this Agreement terminates on December 31, 2013 and is not renewed, Oakes will be entitled to the Accrued Obligations pursuant to paragraph 7(d)(ii) of this Agreement.

12.           Non-Competition; Non-Disclosure; Return of Company Property

(a)           Oakes agrees that during his employment with the Company and for a period of one year thereafter, he will not, without the prior written approval of the Board, directly or indirectly, through any other individual or entity become an officer or employee of, or render any services (including consulting services) to, any competitor of the Company; provided that if (1)

 

 

 

  

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Oakes’s employment shall not have been terminated by the Company for cause or by Oakes without good reason and (2) Oakes shall execute and deliver to the Company a General Release attached as Exhibit A, the period during which Oakes shall be bound by the provisions of this paragraph 12(a) shall coincide with the period, if any, during which he is receiving severance benefits; provided further that the Company, at its election and in its sole discretion, may continue to pay to Oakes an amount equal to his monthly Base Salary (as provided in paragraph 4(a)) for a period of up to six (6) months following the conclusion of the term of this Agreement, and, for so long as the Company is making such payment, Oakes shall continue to be bound by the provisions of this paragraph 12(a).

Nothing contained in this paragraph 12(a) shall be construed as preventing Oakes from investing his assets in such form or manner as will not require him to become an officer, director or employee of, or render any services (including consulting services), directly or indirectly, to, any competitor of the Company; provided that such investment does not exceed five percent (5%) of the issued and outstanding equity securities of such competitor of the Company.

(b)           Oakes agrees that during his employment with the Company and for a period of twelve (12) months thereafter, he will not, without the prior written approval of the Board, directly or indirectly, through any other individual or entity,

(i)           solicit, raid, entice or induce any customer of the Company to cease purchasing goods or services from the Company or to become a customer of any competitor of the Company, and Oakes will not approach any customer for any such purpose or authorize the taking of any such actions by any other individual or entity, or

(ii)           solicit, raid, entice or induce any employee of the Company, and Oakes will not approach any such employee for any such purpose or authorize the taking of any such action by any other individual or entity.

(c)           During Oakes’s employment with the Company and at all times thereafter, Oakes shall not disclose to any person, firm or corporation other than the Company any trade secrets, trade information, techniques or other confidential information of the business of the Company, its methods of doing business or information concerning its customers learned or acquired by Oakes during Oakes’s relationship with the Company (“Confidential Information”) and shall not engage in any unfair trade practices with respect to the Company.

(d)           Upon termination of employment for any reason, Oakes will deliver to the Company (and will not keep in his possession, custody or control, or recreate or deliver to anyone else) any and all devices, records, recordings, data, notes, reports, proposals, lists, correspondence, specifications, drawings, blueprints, sketches, materials, computer materials, equipment, other documents or property, together with all copies thereof (in whatever medium recorded), belonging to the Company, or any other physical recordation or embodiment of Confidential Information.  Oakes further agrees that any property situated on the Company’s premises and owned by the Company, including computer disks and other digital, analog or hard copy storage media, drives, filing cabinets or other work areas, is subject to inspection by Company personnel at any time with or without notice.

 

 

 

  

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13.           Enforcement.

(a)           The necessity for protection of the Company and its subsidiaries against Oakes’s competition, as well as the nature and scope of such protection, has been carefully considered by the parties hereto in light of the uniqueness of Oakes’s talent and his importance to the Company. Accordingly, Oakes agrees that, in addition to any other relief to which the Company may be entitled, the Company shall be entitled to seek and obtain injunctive relief (without the requirement of any bond) for the purpose of restraining Oakes from any actual or threatened breach of the covenants contained in paragraph 12 of this Agreement.

(b)           If for any reason a court determines that the restrictions under paragraph 12 of this Agreement are not reasonable or that consideration therefore in adequate, the parties expressly agree and covenant that such restrictions shall be interpreted, modified or rewritten by such court to include as much of the duration and scope identified in paragraph 12 as will render the restrictions valid and enforceable.

14.              Cooperation.  In connection with the Company's participation in current or future litigation relating to events which occurred during Oakes’s employment or about which Oakes has information, Oakes agrees to cooperate fully and devote such time as may be reasonably required in the preparation, prosecution or defense of the Company's case or

cases, including, but not limited to, the execution of truthful declarations or providing information and/or documents requested by the Company. The Company shall reimburse or compensate Oakes, upon receipt of satisfactory evidence thereof, for (i) all reasonable expenses incurred by Oakes in connection with such assistance and/or cooperation with the Company with respect to such litigation and (ii) the time expended by Oakes in fulfilling his obligations under this Section 14 in excess of forty (40) hours in the aggregate, at a rate of $150 per hour.

15.           Notices. Any notice to be given to the Company or Oakes hereunder shall be deemed given if delivered personally or mailed by certified or registered mail, postage prepaid, to the other party hereto at the following addresses:

	
To the Company:

	
Direct Insite Corp.

	
  

	
13450 West Sunrise Blvd., #510

	
  

	
Sunrise, FL 33323

	
  

	
Attn:  Corporate Secretary

 

	
Copy to:

	
Kramer Levin Naftalis & Frankel LLP

1177 Avenue of the Americas

New York, NY 10036

Tel.: (212) 715-9100

Attn: Scott Rosenblum, Esq.

 

 

  

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To: Oakes:

	
Matthew E. Oakes

	
  

	
1977 Gulf Shore Boulevard North

	
  

	
Unit 206

	
  

	
Naples, Florida 34102

	
Copy to:

	
matthew.oakes@directinsite.com

	
  

	
and

	
  

	
Todd Sullivan Esq.,

Womble Carlyle Sandridge & Rice

150 Fayetteville Street, Suite #2100

Raleigh, NC 27601

 

Either party may change the address to which notice may be given hereunder by giving notice to the other party as provided herein.

16.           Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the Company and upon Oakes, his heirs, executors, administrators and legal representatives. No party may assign this Agreement without first obtaining the written consent of the other party hereto; provided that the Company may assign this Agreement to any successor to all or substantially all of its assets.

17.           Entire Agreement. This Agreement constitutes the entire agreement between the parties except as specifically otherwise indicated herein.

18.           Jurisdiction and Venue. It is hereby irrevocably agreed that all disputes or controversies between the Company and Oakes arising out of, in con­nection with or relating to this Agreement shall be exclusively heard, settled and determined by arbitration to be held in the  County of Broward, State of Florida, in accordance with the Commercial Arbitration Rules of the American Arbitration Asso­ciation to be conducted before three arbitrators, who shall all be either attorney(s) or retired judge(s) licensed to practice law in the State of Florida. Any award made by such arbitrators shall be binding and conclusive for all purpose thereof and may be entered as a final judgment in any court of competent jurisdiction. The parties also agree that judgment may be entered on the arbitrator's award by any court having jurisdiction thereof and the parties consent to the jurisdiction of any court located in the County of Broward, State of Florida for this purpose. Each party hereby further agrees that service of process may be made upon it by registered or certified mail or personal service at the address provided for herein. In the event of any material breach of this Agreement by the Company, when no material breach has occurred by Oakes, actual damages would be difficult to determine, and the parties, therefore, agree that as liquidated damages Oakes shall be entitled to receive the balance of the compensation/ payments and benefits specified in paragraph 7(d) of this Agreement.

19.           Governing Law. This Agreement shall be construed in accordance with the laws of the State of Delaware.

 

 

 

  

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

DIRECT INSITE CORP.

 

 

By: /s/ Sandra Wallace

Sandra Wallace, VP of Finance and Acting Chief Financial Officer  

 

 

 

 

/s/ Matthew E. Oakes

Matthew E. Oakes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[Signature Page to Matthew E. Oakes Employment Agreement, dated as of January 1, 2012]

 

 

  

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EXHIBIT A

 

GENERAL RELEASE

 

This GENERAL RELEASE (the “Release”) is made this __ day of __________, 20__ between Direct Insite Corp., (the “Company”) and Matthew E. Oakes (“Oakes”).

 

WHEREAS, Oakes and the Company entered into an Agreement dated [date] (the “Agreement”);

 

WHEREAS, Oakes’s employment terminated as of [date] (the “Separation Date”); and

 

WHEREAS, Oakes and the Company desire to settle fully and finally any differences, rights and duties arising between them;

 

NOW, THEREFORE, in consideration of the post-separation payments described in the Agreement, which Oakes acknowledges are in excess of any benefits to which he would otherwise be entitled, the parties agree as follows:

 

1.           Release.  Oakes, for himself and for his children, heirs, administrators, representatives, executors, successors and assigns, releases to the maximum extent permitted by law any and all claims and rights which he has or may have against the Company, and its parents, subsidiaries, affiliates, employee benefit plans, predecessors, successors and assigns; and each of their respective officers, directors, administrators, fiduciaries, trustees, employees, attorneys and agents (the “Releasees”) from the beginning of the world until the date of the execution of this Release, including, but not limited to, any and all charges, complaints, claims, liabilities, obligations, promises, agreements, controversies, damages, remedies, actions, causes of action, suits, rights, demands, costs, losses, debts and expenses (including attorneys’ fees and costs) of any nature whatsoever, whether known or unknown, whether in law or equity (collectively, “Claims”), including, but not limited to, any Claims arising out of or related to the Employment Agreement dated as of January 1, 2012 between Oakes and the Company (the “Agreement”), any Claims arising out of or related to the Agreement, any Claims arising out of or related to Oakes’s employment with the Company and the conclusion thereof, any Claims for wrongful termination, any Claims based on contract whether express or implied, written or oral, and any Claims arising under the United States and/or State Constitutions, federal and/or common law, and/or rights arising out of alleged violations of any federal, state or other government statutes, regulations or ordinances including, without limitation, Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act of 1967, the whistleblower protection provisions of the Sarbanes-Oxley Act, the Americans with Disabilities Act of 1990, the Civil Rights Act of 1866 (42 U.S.C. § 1981), the Civil Rights Act of 1991, the Equal Pay Act, the Family and Medical Leave Act, the Occupational Safety and Health Act of 1970, the Employee Retirement Income Security Act of 1974, the Florida Civil Rights Act of 1992 and the Florida Equal Pay Act, all as amended; provided, however, that this Release does not release or relinquish any of Oakes’s rights to payment of any vested benefits under the Company’s employee benefit plans.

 

 

 

  

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2.           No Prior Filings.  Oakes has not filed against the Company or any of the Releasees, any complaints, charges, proceedings, lawsuits or arbitrations with any government agency, arbitral tribunal, self-regulatory body, or any court arising out of or related to Oakes’s employment by the Company or any other matter arising on or prior to the date hereof.

 

3.           Counsel; Time Period to Consider Release.  Oakes is hereby advised to consult with an attorney prior to executing this Release. Oakes is further notified that he will be given twenty-one (21) days from his receipt of this Release to consider this Release.

 

4.           Acknowledgements.  Oakes acknowledges that:

 

(i)           Oakes has carefully read and understands this Release;

 

(ii)           Oakes has been given twenty-one (21) days from his receipt of this Release to consider his rights and obligations under this Release;

 

(iii)           The Company advised Oakes to consult with an attorney of his choice before signing this Release;

 

(iv)           Oakes understands that he has received valuable consideration for this Release and that therefore this Release is legally binding and that by signing it he gives up certain rights;

 

(v)           Oakes has voluntarily chosen to enter into this Release and has not been forced or pressured in any way to sign it;

 

(vi)           Oakes knowingly and voluntarily releases the Company and the other Releasees from any and all Claims Oakes may have, known or unknown, as provided above, in exchange for the benefits Oakes has obtained by signing, and that these benefits are in addition to any benefit Oakes would have otherwise received if he did not sign this Release;

 

(vii)           Section 1 of this Release includes a waiver of rights and claims Oakes may have under the Age Discrimination in Employment Act of 1967 (29 U.S.C. §621 et seq.);

 

(viii)           Oakes has seven (7) days after he signs this Release to revoke it by notifying the Company in writing.  The Company must actually receive the written notice of revocation within the seven (7) day period.

 

(ix)           The Release shall not become effective or enforceable, and Oakes shall not receive the post-separation payments described in the Agreement, until the Company receives a copy of this Release signed by Oakes and the seven (7) day revocation period has expired; and

 

 

(x)           Oakes does not waive any rights or claims that may arise after the date he has executed this Release.

 

 

 

 

[Signature Page Follows]

 

 

 

 

  

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

 

 

MATTHEW E. OAKES                                                      DIRECT INSITE CORP.

 

 

_______________________                                          By:  ____________________________________

   Sandra Wallace

   VP of Finance and Acting Chief Financial Officer

 

 

 

 

 

15

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