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Exhibit 10.38
 
CONFIDENTIAL SEPARATION AGREEMENT AND GENERAL RELEASE

This Confidential Separation Agreement and General Release (“Agreement”) by and
between Stephen Neu (“Consultant”), and Integral Technologies, Inc., an Nevada
corporation (“Company”) or “Integral”), is dated as of [June 13, 2013] (the
“Agreement Date”) but effective on the Effective Date as defined in Section 1
below.

WHEREAS, on June 1, 2011, Consultant and Company entered into a Consulting and
Confidentiality Agreement (the “Consulting Agreement”)

WHEREAS, Consultant’s services for the Company will terminate as of December 31,
2012 and Consultant is entitled to receive the amounts as set forth in Section
2.1 of this Agreement, subject to the execution of this Agreement; and

WHEREAS, except as otherwise expressly set forth herein, the parties hereto
intend that this Agreement shall supersede all previous agreements and effect a
full satisfaction and release of the obligations described herein owned to
consultant by Company and to Company by Consultant.

NOW, THEREFORE, in consideration of the mutual covenants of the parties
hereinafter set forth and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Consultant and Company hereby
covenant and agree as follows:

1.             Termination of Consulting Services. The consulting services
provided by Consultant to the Company will terminate effective December 31, 2012
(“Termination Date”).

2.             Separation Payments.
 
    2.1            In full consideration of Executive’s execution of this
Agreement, and this agreement to be legally bound by its terms, Company shall
provide Consultant the following benefits and payments:

(a)    Company will deliver to Consultant 541,666 shares that were granted
pursuant to the Restricted Stock Award Grant Agreement dated January 1, 2012
(the “Restricted Stock Agreement”) and that have vested prior to the Agreement
Date; and
(b)    Company will deliver to Consultant 628,571 shares in consideration for
all unpaid consulting fees earned.
(c)    Company will deliver shares within 10 days of execution of this
agreement.
(d)    Company agrees to the removal of the restricted legend on certificates at
such time the appropriate holding period has been met and consultant presents
the shares for legend removal.
 
2.2       Consultant acknowledges that notwithstanding any provision to the
contrary in the Consulting Agreement or otherwise, upon delivery of the
foregoing options and shares, he will have been paid any and all amounts owed to
him by Company through the date hereof, including but not limited to all
consulting fees, all equity and equity-based awards, and all other compensation
of any nature whatsoever. Consultant agrees that upon execution of this
Agreement, (a) he will forfeit and have no right to any payment of any nature
under the terms of the Consulting Agreement, (b) the 600,000 options granted to
him in connection with the Consulting Agreement, the Grant of the Option forms
attached to the Consulting Agreement, and subject to the Option Repricing
Agreement dated December 20, 2011 shall be immediately forfeited, and (c) the
remaining 750,000 unvested shares of restricted stock that were granted pursuant
to the Restricted Stock Agreement that have not vested prior to the Agreement
Date shall be immediately forfeited.

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3.         No Disparagement. Consultant will not make any oral or written
statement to any person that disparages Company, and affiliate of Company, or
any past or present member, employee, product, or service of Company, or any
affiliate of Company.  If Consultant receives any subpoena or becomes subject to
any legal obligation that might require him to engage in the conduct described
in the preceding sentence, Consultant will provide prompt written notice of that
fact to Doug Bathauer, Chief Executive Officer of Company, enclosing a copy of
the subpoena and any other documents describing the legal obligation. Nothing
herein shall prevent Consultant from testifying truthfully in any legal
proceeding.

 
4.         Confidentiality. Executive will not at any time (a) retain or use for
the benefit, purposes or account of Consultant or any other Person (other than
Company or its affiliates); or (b) disclose, divulge, reveal, communicate,
share, transfer or provide access to any Person outside Company (other than its
professional advisers who are bound by confidentiality obligations), any
non-public, proprietary or confidential information – including without
limitation trade secrets, know-how, research and development, software,
database, inventions, process, formulae, technology, designs and other
intellectual property, information concerning finances, investments, profits,
pricing, costs, products, services, vendors, customers, clients, partners,
investors, personnel, compensation, recruiting, training, advertising, sales,
marketing, promotions, government and regulatory activities and approvals –
concerning the past, current or future business, activities and operations of
the Company, its subsidiaries or affiliates and/or any third party that has
disclosed or provided any of same to the Company on a confidential basis
(“Confidential Information”) without the prior written authorization of Company.
 
5.         Cooperation and Assistance. Consultant shall upon reasonable notice,
furnish such information and proper assistance to Company as it may reasonably
require in connection with (a) any litigation in which it is, or may become, a
party either during or after Consultant’s consulting services; or (b) any other
matter of which Consultant has knowledge. If such assistance is needed after the
“Termination Date, Consultant shall be reimbursed for reasonable and customary
fees and expenses in connection with such assistance.
 
6.         Confidentiality of Agreement. Except as may be specifically required
by law or to enforce this Agreement, Consultant shall not disclose this
Agreement, any of its terms, or any communications between Consultant or his
attorneys and Company or their attorneys about any actual or proposed terms of
this Agreement (collectively, “Agreement Information”) to anyone except
Consultant’s attorney, Consultant’s spouse, and Consultant’s account or tax
preparer to the limited extent necessary to allow that person to prepare
Consultant’s tax returns, (each, an “Authorized Party”). Before disclosing any
Agreement Information to an Authorized Party, Consultant shall obtain the
Authorized Party’s agreement to keep all Agreement Information confidential.
Consultant understands and agrees that Company may hold Consultant liable for
breaching this Section 6 if Consultant or an Authorized Party disclose any
Agreement Information in violation of the preceding sentence. Consultant
represents and warrants that he and all Authorized Parties have fully complied
with this Section 6 through the date on which he signed this Agreement. If
Consultant learns that he or any Authorized Party is specifically required by
law to disclose any Agreement Information, Consultant shall provide prompt
notice to Company at least five (5) business days before any such disclosure
must be made, describing the scope, nature, and timing of any such legal
required disclosure. Notwithstanding the foregoing, Consultant may share with
any person or entity with whom he does or may do business a document that
completely and accurately quotes the Restrictive Covenants and describes those
provisions as contractual obligations of Consultant.

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7.         Release and Agreement Not to Sue.

7.1       Consultant (on behalf of himself and his agents, representatives,
attorneys, assigns, heirs, excutors, and administrators) releases each of the
Released Parties from, and agrees no to bring or participate as a plaintiff or
claimant in any suit, action, or proceeding against any of the Released Parties
regarding, any and all liability, claims, demands, actions, causes of actions,
suits, grievances, debts, sums of money, agreements, promises, damages, back and
front pay, costs, expenses, attorneys’’ fee and remedies of any types, whether
now known or unknown (collectively, “Claims”), relating to any act or failure to
act that occurred before Consultant signed this Agreement, including, without
limitation, all Claims arising out of or in connection with the Consultant
Agreement or the provision of consulting services by Consultant to the Company

8.         The provisions of this Agreement shall be governed by the laws of the
State of Washington, without regard to any choice of law provisions.

For a notice to Company

Integral Technologies, Inc.,
[220 Commerce Drive, Suite 205]
[Fort Washington, PA 19034]
Attention: Doug Bathauer

For notice to Consultant:

Stephen Neu
[318 Washington Drive
Chester Springs, PA 19425

[Signature page follows.]

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IN WITNESS WHEREOF, the parties have executed this Confidential Separation
Agreement and General Release as of the respective dates set forth below

STEPHEN NEU
 
 
INTEGRAL TECHNOLOGIES, INC.
 
 
 
 
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By
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Its:
 
Dated:
6/13/2013
 
Dated:
6/13/2013

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