Exhibit 10.2

TRANSITION AND SEPARATION AGREEMENT

This Transition and Separation Agreement (the “Agreement”) by and between
Christopher M. Starr, Ph.D. (“Executive”) and Raptor Pharmaceutical Corp., a
Delaware corporation (the “Company”), is made effective as of the date Executive
signs this Agreement (the “Effective Date”) with reference to the following
facts:

A. Executive’s employment with the Company and status as an officer and employee
of the Company and each of its affiliates will end effective upon the
Resignation Date (as defined below).

B. Executive and the Company want to end their relationship amicably and also to
establish the obligations of the parties including, without limitation, all
amounts due and owing to the Executive.

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

1. Resignation Date. Executive acknowledges and agrees that his status as an
officer and employee of the Company and as an officer of the Company’s
subsidiaries will end effective as of December 31, 2014 (the “Resignation
Date”). Executive hereby agrees to execute such further document(s) as shall be
determined by the Company as necessary or desirable to give effect to the
termination of Executive’s status as an officer of the Company and each of its
subsidiaries; provided that such documents shall not be inconsistent with any of
the terms of this Agreement. Executive will continue to serve as a non-employee
director on the Board of Directors of the Company (the “Board”) following the
Resignation Date. Between the Effective Date through the Resignation Date,
Mr. Starr’s employment agreement with the Company entered into as of May 1,
2006, as amended on January 1, 2009 (the “Employment Agreement”), shall continue
in effect.

2. Transition. Executive acknowledges and agrees that effective July 7, 2014,
the Executive Vice President Strategy and Chief Operational Officer will be
promoted to President and Chief Executive Officer Designate with the expectation
that she will be appointed Chief Executive Officer on January 1, 2015.

3. Transition Consulting Services.

(a) Consulting Period. During the period of time (the “Consulting Period”)
commencing on the Resignation Date and ending on the earlier of the first
anniversary of the Resignation Date or the date the Company terminates the
services hereunder for Cause (as defined in the Employment Agreement) or
Executive terminates the services hereunder for any reason (the “Consulting
Period End Date”), Executive shall be available to provide services to the
Company, on a non-exclusive basis, as a consultant and shall provide such
transition services (the “Transition Services”) as necessary in Executive’s
areas of expertise and work experience and responsibility as may be requested by
the Chief Executive Officer of the Company at times reasonably agreeable to
Executive and the Company’s Chief Executive Officer. During the Consulting
Period, Executive will report to the Chief Executive Officer of the Company.
Executive acknowledges and agrees that, during the Consulting Period, Executive
shall not, directly or indirectly, become employed by or provide assistance to
any competitor of the Company that is involved in drug development for
nephropathic cystinosis, nonalcoholic fatty liver disease, Huntington’s disease
(HD), and Leigh syndrome or other mitochondrial disease. During the Consulting

 

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Period, Executive reaffirms his commitment to remain in compliance with that
certain Employee Invention Assignment and Confidentiality Agreement entered into
between Executive and the Company, as of May 1, 2006 (the “Confidentiality
Agreement”), it being understood that the term “employment” as used in the
Confidentiality Agreement shall include the Transition Services during the
Consulting Period. Executive and the Company acknowledge and agree that the
intent of the parties hereto is that Executive serve the Company during the
Consulting Period at the average rate of not more than eight hours per week.

(b) Consulting Fees. In exchange for the performance of the Transition Services
and subject to continuing compliance by Executive with the terms of the
Confidentiality Agreement, for the Consulting Period, the Company shall pay to
Executive monthly consulting fees as an independent contractor (the “Consulting
Fees”) in an amount equal to $20,000 per month. The Consulting Fees will be paid
to Executive in accordance with the Company’s standard payment procedures for
consultants and independent contractors and will be in addition to fees and
other compensation Executive will be entitled to as a non-employee member of the
Board.

(c) Benefits. As an independent contractor, Executive understands and agrees
that, while performing any services for the Company after the Resignation Date,
Executive shall not be eligible to participate in or accrue benefits under any
Company benefit plan for which status as an employee of the Company is a
condition of such participation or accrual. To the extent that Executive were
deemed eligible to participate, as an employee, in any Company benefit plan, he
hereby waives his participation.

(d) Stock Options. Until the later of (i) the Consulting Period End Date and
(ii) the end of the period Executive continues to serve as a non-employee
director on the Board (through such later date, the “Service Period”),
Executive’s options to purchase shares of Company common stock (collectively,
“Options”) shall continue to vest and become exercisable in accordance with
their original vesting schedules. At the end of the Service Period, Executive’s
unvested equity awards shall be forfeited.

Options held by Executive that are vested as of the end of the Service Period,
other than Options granted to Executive in 2010, shall remain exercisable until
the earlier of (i) eighteen months after Executive’s termination of Continuous
Services, or (ii) the original expiration date of the Option. Options held by
Executive that are vested as of the end of the Service Period and that were
granted to Executive in 2010 shall be deemed amended to the extent necessary to
provide that the vested portion thereof shall remain exercisable until the
earlier of (i) twelve months after Executive’s termination of Continuous
Services, and (ii) the original expiration date of the Option. Executive
acknowledges that to the extent the Options granted in 2010 constitute
“incentive stock options” within the meaning of Section 422 of the Internal
Revenue Code of 1986, as amended (the “Code”), they shall be deemed modified for
the purposes of Section 424 of the Code and, to the extent the exercise price
thereof is lower than the fair market value of the Company’s common stock as of
the date Executive signs this Agreement, such Option shall no longer qualify as
incentive stock options and Executive will lose the potentially favorable tax
treatment associated with such Options.

(e) Independent Contractor Status. Executive and the Company acknowledge and
agree that, during the Consulting Period, Executive shall be an independent
contractor. During the Consulting Period and thereafter, Executive shall not be
an agent or employee of the Company and shall not be authorized to act on behalf
of the Company. The

 

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Company will not make deductions for taxes from any Consulting Fees paid
hereunder. Personal income and self-employment taxes for Consulting Fees paid to
Executive hereunder shall be the sole responsibility of Executive. Executive
agrees to indemnify and hold the Company and the other entities released herein
harmless for any tax claims or penalties resulting from any failure by Executive
to make required personal income and self-employment tax payments with respect
to the Consulting Fees.

4. Final Paycheck; Payment of Accrued Wages and Expenses.

(a) Final Paycheck. As soon as administratively practicable on or after the
Resignation Date, the Company will pay Executive all accrued but unpaid base
salary and all accrued and unused vacation or other paid time off earned through
the Resignation Date, subject to standard payroll deductions and withholdings.
Executive is entitled to these payments regardless of whether Executive executes
this Agreement or a Release of Claims (as defined below).

(b) Annual Bonus. The Company shall pay Executive the annual bonus earned by
Executive for fiscal year 2014, based on actual performance for fiscal year
2014, payable in a single cash lump sum on the regularly scheduled payment date
under the applicable Company bonus plan or program. Executive is entitled to
this payment regardless of whether Executive executes this Agreement or a
Release of Claims (as defined below).

(c) Business Expenses. The Company shall reimburse Executive for all outstanding
expenses incurred prior to the Resignation Date which are consistent with the
Company’s policies in effect from time to time with respect to travel and other
business expenses, subject to the Company’s requirements with respect to
reporting and documenting such expenses, including, without limitation, expenses
incurred pursuant to Executive’s services as a director of any of the Company’s
subsidiaries. Executive is entitled to these payments regardless of whether
Executive executes this Agreement or a Release of Claims (as defined below).

5. Separation Payments and Benefits. Without admission of any liability, fact or
claim, the Company hereby agrees, subject to Executive delivering to the Company
a General Release of Claims substantially in the form attached hereto as Exhibit
A (the “Release of Claims”) within twenty-three (23) days following the
Resignation Date and Executive not revoking the Release of Claims within the
seven (7)-day period following his execution of such agreement (the “Revocation
Period) and Executive’s performance of his continuing obligations pursuant to
this Agreement and the Confidentiality Agreement, to provide Executive the
severance benefits set forth below. Specifically, the Company and Executive
agree as follows:

(a) Severance. For the twelve (12)-month period commencing on the Resignation
Date (the “Severance Period”), Executive shall receive the continued payment of
his base salary (the aggregate amount for such twelve (12)-month period,
$471,500), subject to continuing compliance by Executive with the terms hereof,
the Confidentiality Agreement and the Release of Claims. Such payment shall be
made in substantially equal installments on a periodic basis in accordance with
the Company’s normal payroll practices; provided, however, that the first
payment under this section shall be made on the first payroll date following the
expiration of the Revocation Period without Executive having revoked the Release
of Claims and with the first such payment to include any installments not made
prior to the expiration of the Revocation Period.

 

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(b) Bonus. The Company shall pay Executive an amount equal to $235,750, which
represents 100% of Executive’s bonus target for fiscal year 2014, less required
withholding taxes, such payment to be made in a single cash lump sum no later
than ten (10) days following the date that is seven (7) days after the
expiration of the Revocation Period without Executive having revoked the Release
of Claims.

(c) Healthcare Continuation Coverage. If Executive elects to receive continued
healthcare coverage pursuant to the provisions of the Consolidated Omnibus
Budget Reconciliation Act of 1985, as amended (“COBRA”), the Company shall
directly pay, or reimburse Executive for, that portion of the premium for
Executive and Executive’s covered dependents necessary such that Executive
contributes the same amount to COBRA coverage as Executive contributed to
medical, dental and vision coverage prior to the date of this Agreement, such
payment or reimbursement to continue until the earliest of (i) the end of the
Severance Period, (ii) the date Executive becomes eligible for comparable
coverage under another employer’s plans or (iii) the date Executive is no longer
eligible for COBRA coverage, provided that Executive submits documentation to
the Company substantiating his payments for COBRA coverage. Any such
reimbursement payments, if applicable, shall be made to Executive no later than
twenty (20) days after Executive’s submission of documentation to the Company
substantiating his payments for COBRA coverage. After the Company ceases to pay
premiums pursuant to the preceding sentence, Executive may, if eligible, elect
to continue healthcare coverage at Executive’s expense in accordance with the
provisions of COBRA.

(d) Taxes. Executive understands and agrees that all payments under this
Agreement will be subject to appropriate tax withholding and other deductions.
To the extent any taxes may be payable by Executive for the benefits provided to
him by this Agreement beyond those withheld by the Company, and to the extent
the Company withheld the proper amounts and remitted them timely to the proper
governmental entities, Executive agrees to pay them himself and to indemnify and
hold the Company and the other entities released herein harmless for any tax
claims or penalties, and associated attorneys’ fees and costs, resulting from
any failure by him to make required payments. To the extent that any
reimbursements payable pursuant to this Agreement are subject to the provisions
of Section 409A of the Code, such reimbursements shall be paid to Executive no
later than December 31 of the year following the year in which the expense was
incurred, the amount of expenses reimbursed in one year shall not affect the
amount eligible for reimbursement in any subsequent year, and Executive’s right
to reimbursement under this Agreement will not be subject to liquidation or
exchange for another benefit.

(e) SEC Reporting. Executive acknowledges that to the extent required by the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), he has
continuing obligations under Section 16(a) and 16(b) of the Exchange Act to
report his transactions in Company common stock while he is serving as a
director on the Board and for six (6) months following the date he ceases to
serve as a director on the Board. Executive hereby agrees not to undertake,
directly or indirectly, any reportable transactions which include, but are not
limited to, buying, selling or otherwise disposing of any common stock of the
Company held by Executive without first preclearing such transaction with the
Company’s Chief Compliance Officer until the end of such periods.

(f) Sole Separation Benefit. Executive agrees that the payments provided by this
Section 5 are not required under the Company’s normal policies and procedures
and are provided as a severance solely in connection with this Agreement and the

 

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Release of Claims. Executive acknowledges and agrees that the payments
referenced in this Section 5 constitute adequate and valuable consideration, in
and of themselves, for the promises contained in this Agreement and the Release
of Claims.

6. Full Payment. Executive acknowledges that the payment and arrangements herein
shall constitute full and complete satisfaction of any and all amounts properly
due and owing to Executive as a result of his employment with the Company and
the termination thereof. Executive further acknowledges that, other than the
Confidentiality Agreement and the Indemnity Agreement between Executive and the
Company (the “Indemnification Agreement”) attached as Exhibit B, and the
agreements evidencing the Options (the “Option Agreements”), this Agreement
shall supersede each agreement entered into between Executive and the Company
regarding Executive’s employment, including, without limitation, any offer
letter, employment agreement, severance and/or change in control agreement, and
each such agreement other than the Option Agreements and the Indemnification
Agreement shall be deemed terminated and of no further effect as of the
Resignation Date.

7. Executive’s Release of the Company. Executive agrees that the consideration
set forth in this Agreement represents settlement in full of all outstanding
obligations owed to Executive by the Company and its current and former
officers, directors, employees, agents, investors, attorneys, affiliates,
divisions, and subsidiaries, and predecessor and successor corporations and
assigns (collectively, the “Releasees”).

(a) Executive, on his own behalf and on behalf of his family members, heirs,
executors, administrators, agents, and assigns, hereby and forever releases the
Releasees from, and agrees not to sue concerning, or in any manner to institute,
prosecute, or pursue, any claim, complaint, charge, duty, obligation, or cause
of action relating to any matters of any kind, whether presently known or
unknown, suspected or unsuspected, that Executive may possess against any of the
Releasees arising from any omissions, acts, facts, or damages that have occurred
up until and including the Effective Date of this Agreement, including, without
limitation:

(i) any and all claims relating to or arising from Executive’s employment
relationship with Company and the termination of that relationship;

(ii) any and all claims for wrongful discharge of employment; termination in
violation of public policy; discrimination; harassment; retaliation; breach of
contract, both express and implied; breach of covenant of good faith and fair
dealing, both express and implied; promissory estoppel; negligent or intentional
infliction of emotional distress; fraud; negligent or intentional
misrepresentation; negligent or intentional interference with contract or
prospective economic advantage; unfair business practices; defamation; libel;
slander; negligence; personal injury; assault; battery; invasion of privacy;
false imprisonment; conversion; and disability benefits;

(iii) any and all claims for violation of any federal, state, or municipal
statute, including, but not limited to, Title VII of the Civil Rights Act of
1964; the Civil Rights Act of 1991; the Rehabilitation Act of 1973; the
Americans with Disabilities Act of 1990; the Equal Pay Act; the Fair Labor
Standards Act, except as prohibited by law; the Fair Credit Reporting Act; the
Age Discrimination in Employment Act of 1967; the Older Workers Benefit
Protection Act; the Employee Retirement Income Security Act of 1974; the Worker
Adjustment and Retraining

 

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Notification Act; the Family and Medical Leave Act, except as prohibited by law;
the Sarbanes-Oxley Act of 2002, except as prohibited by law; the Uniformed
Services Employment and Reemployment Rights Act; the California Family Rights
Act; the California Labor Code, except as prohibited by law; the California
Workers’ Compensation Act, except as prohibited by law; and the California Fair
Employment and Housing Act;

(iv) any and all claims for violation of the federal or any state constitution;

(v) any and all claims arising out of any other laws and regulations relating to
employment or employment discrimination;

(vi) any claim for any loss, cost, damage, or expense arising out of any dispute
over the non-withholding or other tax treatment of any of the proceeds received
by Executive as a result of this Agreement; and

(vii) any and all claims for attorneys’ fees and costs.

(b) Executive agrees that the release set forth in this section shall be and
remain in effect in all respects as a complete general release as to the matters
released. This release does not extend to any obligations incurred under this
Agreement, the Option Agreements, or the Indemnification Agreement. This release
does not release claims or rights that cannot be released as a matter of law,
including, but not limited to, claims under Division 3, Article 2 of the
California Labor Code (which includes California Labor Code section 2802
regarding indemnity for necessary expenditures or losses by Executive) any other
indemnification, defense, or hold-harmless rights Executive may have, and
Executive’s right to bring to the attention of the Equal Employment Opportunity
Commission or California Department of Fair Employment and Housing claims of
discrimination, harassment or retaliation; provided, however, that Executive
does release his right to obtain damages for any such claims. This release does
not release claims or rights that the Executive may have as a shareholder of the
Company or for benefits under any benefit plan or to participation in any such
plan pursuant to the terms thereof or applicable law.

(c) Executive acknowledges that he has been advised to consult with legal
counsel and is familiar with the provisions of California Civil Code
Section 1542, a statute that otherwise prohibits unknown claims, which provides
as follows:

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH
IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH
THE DEBTOR.

Executive, being aware of said code section, agrees to expressly waive any
rights he may have thereunder, as well as under any other statute or common law
principles of similar effect.

 

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8. Non-Disparagement, Transition, Transfer of Company Property and Limitations
on Service. Executive further agrees that:

(a) Non-Disparagement. Executive agrees that he shall not disparage, criticize
or defame the Company, its affiliates and their respective affiliates,
directors, officers, agents, partners, stockholders, employees, products,
services, technology or business, either publicly or privately. The Company
agrees that it shall not, and it shall instruct its officers and members of the
Board to not, disparage, criticize or defame Executive, either publicly or
privately. Nothing in this Section 8(a) shall have application to any evidence
or testimony required by any court, arbitrator or government agency.

(b) Transition. Each of the Company and Executive shall use their respective
reasonable efforts to cooperate with each other in good faith to facilitate a
smooth transition of Executive’s duties to other executive(s) of the Company.

(c) Transfer of Company Property. On or before the Resignation Date, Executive
shall turn over to the Company all files, memoranda, records, and other
documents, and any other physical or personal property which are the property of
the Company and which he has in his possession, custody or control at the
Resignation Date; provided that during the Consulting Period, Executive will
continue to keep his cell phone service, email, laptop and other equipment
necessary to perform the Transition Services.

9. Executive Representations. Executive warrants and represents that (a) he has
not filed or authorized the filing of any complaints, charges or lawsuits
against the Company or any affiliate of the Company with any governmental agency
or court, and that if, unbeknownst to Executive, such a complaint, charge or
lawsuit has been filed on his behalf, he will use reasonable best efforts to
immediately cause it to be withdrawn and dismissed, , and (b) he has no known
workplace injuries or occupational diseases and has been provided and/or has not
been denied any leave requested under the Family and Medical Leave Act or any
similar state law, .

10. No Assignment by Executive. Executive warrants and represents that no
portion of any of the matters released herein, and no portion of any recovery or
settlement to which Executive might be entitled, has been assigned or
transferred to any other person, firm or corporation not a party to this
Agreement, in any manner, including by way of subrogation or operation of law or
otherwise. If any claim, action, demand or suit should be made or instituted
against the Company or any other Releasee because of any actual assignment,
subrogation or transfer by Executive, Executive agrees to indemnify and hold
harmless the Company and all other Releasees against such claim, action, suit or
demand, including necessary expenses of investigation, attorneys’ fees and
costs. In the event of Executive’s death, this Agreement shall inure to the
benefit of Executive and Executive’s executors, administrators, heirs,
distributees, devisees, and legatees. None of Executive’s rights or obligations
may be assigned or transferred by Executive, other than Executive’s rights to
payments hereunder, which may be transferred only upon Executive’s death by will
or operation of law.

11. Non-Solicitation. Without limiting the Confidentiality Agreement, Executive
hereby agrees that Executive shall not, at any time during the Consulting Period
or within the one (1) year period immediately following the Resignation Date,
directly or indirectly, either for himself or on behalf of any other person,
recruit or otherwise solicit or induce any employee or consultant of the Company
to terminate its employment or arrangement with the Company, or otherwise change
its relationship with the Company. Notwithstanding the foregoing, nothing herein
shall prevent Executive from directly or indirectly hiring any individual who

 

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submits a resume or otherwise applies for a position in response to a publicly
posted job announcement or otherwise applies for employment with any person with
whom Executive may be associated absent any violation of Executive’s obligations
pursuant to the preceding sentence.

12. Governing Law. This Agreement shall be construed and enforced in accordance
with, and the rights of the parties shall be governed by, the laws of the State
of California or, where applicable, United States federal law, in each case,
without regard to any conflicts of laws provisions or those of any state other
than California.

13. Miscellaneous. This Agreement, collectively with the Confidentiality
Agreement, the Indemnification Agreement, the Option Agreements and the form of
General Release of Claims attached as Exhibit A hereto comprise the entire
agreement between the parties with regard to the subject matter hereof and
supersedes, in their entirety, any other agreements between Executive and the
Company with regard to the subject matter hereof. Executive acknowledges that
there are no other agreements, written, oral or implied, and that he may not
rely on any prior negotiations, discussions, representations or agreements. This
Agreement may be modified only in writing, and such writing must be signed by
both parties and recited that it is intended to modify this Agreement. This
Agreement may be executed in separate counterparts, each of which is deemed to
be an original and all of which taken together constitute one and the same
agreement. The Company shall reimburse Executive for the reasonable attorneys’
and professional tax or financial advisors’ fees and related expenses and
disbursements incurred by Executive in connection with Executive’s separation of
employment with the Company and the negotiation and preparation of this
Agreement, in an aggregate amount not to exceed $10,000.

14. Company Assignment and Successors. The Company shall assign its rights and
obligations under this Agreement to any successor to all or substantially all of
the business or the assets of the Company (by merger or otherwise). This
Agreement shall be binding upon and inure to the benefit of the Company and its
successors, assigns, personnel and legal representatives.

15. Maintaining Confidential Information. Executive reaffirms his obligations
under the Confidentiality Agreement. Executive acknowledges and agrees that the
payments provided in Sections 3 and 5 above shall be subject to Executive’s
continued compliance with Executive’s obligations under the Confidentiality
Agreement.

16. Executive’s Cooperation. After the Resignation Date, Executive shall
cooperate with the Company and its affiliates, upon the Company’s reasonable
request, with respect to any internal investigation or administrative,
regulatory or judicial proceeding involving matters within the scope of
Executive’s duties and responsibilities to the Company or its affiliates during
his employment with the Company (including, without limitation, Executive being
available to the Company upon reasonable notice for interviews and factual
investigations, appearing at the Company’s reasonable request to give testimony
without requiring service of a subpoena or other legal process, and turning over
to the Company all relevant Company documents which are or may have come into
Executive’s possession during his employment); provided, however, that any such
request by the Company shall not be unduly burdensome or interfere with
Executive’s personal schedule or ability to engage in gainful employment and the
Company shall pay Executive a mutually agreed upon daily rate for any such
cooperation (other than for de minimis amounts of time and testimony under oath)
after the Consulting Period and shall reimburse Executive for his actual,
reasonable, out-of-pocket expenses incurred in connection with providing any
such cooperation.

 

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(Signature page(s) follow)

 

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IN WITNESS WHEREOF, the undersigned have caused this Transition and Separation
Agreement to be duly executed and delivered as of the date indicated next to
their respective signatures below.

 

DATED: July 7, 2014      

 /s/ Christopher M. Starr

  Christopher M. Starr, Ph.D.   RAPTOR PHARMACEUTICAL CORP. DATED: July 7, 2014
      By:  

Llew Keltner, M.D., P.h.D.

    Llew Keltner, M.D., P.h.D.     Chairman of the Board of Directors

 

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EXHIBIT A

GENERAL RELEASE OF CLAIMS

This General Release of Claims (“Release”) is entered into as of             ,
between Christopher M. Starr, Ph.D. (“Executive”) and Raptor Pharmaceutical
Corp., a Delaware corporation (the “Company”) (collectively referred to herein
as the “Parties”), effective eight (8) days after Executive’s signature hereto
(the “Effective Date”), unless Executive revokes his acceptance of this Release
as provided in Paragraph 1(c), below.

1. Executive’s Release of the Company.

(a) Executive, on his own behalf and on behalf of his family members, heirs,
executors, administrators, agents, and assigns, hereby and forever releases the
Company and its current and former officers, directors, employees, agents,
investors, attorneys, affiliates, divisions, and subsidiaries, and predecessor
and successor corporations and assigns (the “Releasees”) from, and agrees not to
sue concerning, or in any manner to institute, prosecute, or pursue, any claim,
complaint, charge, duty, obligation, or cause of action relating to any matters
of any kind, whether presently known or unknown, suspected or unsuspected, that
Executive may possess against any of the Releasees arising from any omissions,
acts, facts, or damages that have occurred up until and including the date
Executive signs this Release, including, without limitation:

(i) any and all claims relating to or arising from Executive’s employment
relationship with Company and the termination of that relationship;

(ii) any and all claims for wrongful discharge of employment; termination in
violation of public policy; discrimination; harassment; retaliation; breach of
contract, both express and implied; breach of covenant of good faith and fair
dealing, both express and implied; promissory estoppel; negligent or intentional
infliction of emotional distress; fraud; negligent or intentional
misrepresentation; negligent or intentional interference with contract or
prospective economic advantage; unfair business practices; defamation; libel;
slander; negligence; personal injury; assault; battery; invasion of privacy;
false imprisonment; conversion; and disability benefits;

(iii) any and all claims for violation of any federal, state, or municipal
statute, including, but not limited to, Title VII of the Civil Rights Act of
1964; the Civil Rights Act of 1991; the Rehabilitation Act of 1973; the
Americans with Disabilities Act of 1990; the Equal Pay Act; the Fair Labor
Standards Act, except as prohibited by law; the Fair Credit Reporting Act; the
Age Discrimination in Employment Act of 1967; the Older Workers Benefit
Protection Act; the Employee Retirement Income Security Act of 1974; the Worker
Adjustment and Retraining Notification Act; the Family and Medical Leave Act,
except as prohibited by law; the Sarbanes-Oxley Act of 2002, except as
prohibited by law; the Uniformed Services Employment and Reemployment Rights
Act; the California Family Rights Act; the California Labor Code, except as
prohibited by law; the California Workers’ Compensation Act, except as
prohibited by law; and the California Fair Employment and Housing Act;

(iv) any and all claims for violation of the federal or any state constitution;

 

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(v) any and all claims arising out of any other laws and regulations relating to
employment or employment discrimination;

(vi) any claim for any loss, cost, damage, or expense arising out of any dispute
over the non-withholding or other tax treatment of any of the proceeds received
by Executive as a result of the Transition and Separation Agreement entered into
between the Parties as of July 7, 2014 (the “Transition and Separation
Agreement”); and

(vii) any and all claims for attorneys’ fees and costs.

(b) Executive agrees that the release set forth in this section shall be and
remain in effect in all respects as a complete general release as to the matters
released. This release does not extend to any obligations incurred under the
Transition and Separation Agreement, the Option Agreements, or the
Indemnification Agreement (each as defined in the Transition and Separation
Agreement). This release does not release claims or rights that cannot be
released as a matter of law, including, but not limited to, claims under
Division 3, Article 2 of the California Labor Code (which includes California
Labor Code section 2802 regarding indemnity for necessary expenditures or losses
by Executive) any other indemnification, defense, or hold-harmless rights
Executive may have, and Executive’s right to bring to the attention of the Equal
Employment Opportunity Commission or California Department of Fair Employment
and Housing claims of discrimination, harassment or retaliation; provided,
however, that Executive does release his right to obtain damages for any such
claims. This release does not release claims or rights that the Executive may
have as a shareholder of the Company or for vested benefits under any benefit
plan or to continued participation in any such plan pursuant to the terms
thereof or applicable law.

(c) Acknowledgment of Waiver of Claims under ADEA. Executive acknowledges that
he is waiving and releasing any rights he may have under the Age Discrimination
in Employment Act of 1967 (“ADEA”), and that this waiver and release is knowing
and voluntary. Executive acknowledges that this waiver and release does not
apply to any rights or claims that may arise under the ADEA after the Effective
Date of this Release. Executive acknowledges that the consideration given for
this waiver and release is in addition to anything of value to which Executive
was already entitled. Executive further acknowledges that he has been advised by
this writing that: (a) he should consult with an attorney prior to executing
this Release; (b) he has twenty-one (21) days within which to consider this
Release; (c) he has seven (7) days following his execution of this Release to
revoke this Release; (d) this Release shall not be effective until after the
revocation period has expired and Executive will not receive the severance
benefits provided by Section 5 of the Transition and Separation Agreement; and
(e) nothing in this Release prevents or precludes Executive from challenging or
seeking a determination in good faith of the validity of this waiver under the
ADEA, nor does it impose any condition precedent, penalties, or costs for doing
so, unless specifically authorized by federal law. In the event Executive signs
this Release and returns it to the Chief Financial Officer in less than the
21-day period identified above, Executive hereby acknowledges that he has freely
and voluntarily chosen to waive the time period allotted for considering this
Release. To revoke his acceptance of this Release, Executive must contactthe
Chief Financial Officer by facsimile at 415-382-8002 no later than 5 p.m. on the
7th day following Executive’s signature of this Release.

 

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(d) California Civil Code Section 1542. Executive acknowledges that he has been
advised to consult with legal counsel and is familiar with the provisions of
California Civil Code Section 1542, a statute that otherwise prohibits unknown
claims, which provides as follows:

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH
IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH
THE DEBTOR.

Executive, being aware of said code section, agrees to expressly waive any
rights he may have thereunder, as well as under any other statute or common law
principles of similar effect.

2. Executive Representations. Executive represents and warrants that:

(a) To Executive’s knowledge, Executive has returned to the Company all Company
property in Executive’s possession and if he discovers additional Company
property in his possession he will promptly return it to the Company;

(b) Except as Executive has informed the Company in writing, Executive is not
owed wages, commissions, bonuses or other compensation, other than any payments
that become due under Sections 3 and 5 of the Transition and Separation
Agreement;

(c) During the course of Executive’s employment Executive did not sustain any
injuries for which Executive might be entitled to compensation pursuant to
worker’s compensation law or Executive has disclosed any injuries of which he is
currently, reasonably aware for which he might be entitled to compensation
pursuant to worker’s compensation law;

(d) From the date Executive executed the Transition and Separation Agreement
through the date Executive executes this Release, Executive has not made any
disparaging comments about the Company, nor will Executive do so in the future;
and

(e) Executive has not initiated any adversarial proceedings of any kind against
the Company or against any other person or entity released herein, nor will
Executive do so in the future with respect to any claims released hereby, except
as specifically allowed by this Release.

3. Maintaining Confidential Information. Executive reaffirms his obligations
under that certain Employee Invention Assignment and Confidentiality Agreement
entered into between Executive and the Company, as of May 1, 2006 (the
“Confidentiality Agreement”). Executive acknowledges and agrees that the
payments provided in Sections 3 and 5 of the Transition and Separation Agreement
shall be subject to Executive’s continued compliance with Executive’s
obligations under the Confidentiality Agreement.

4. Non-Solicitation. Executive reaffirms his obligations pursuant to Section 11
of the Transition and Separation Agreement.

 

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5. Cooperation with the Company. Executive reaffirms his obligations to
cooperate with the Company pursuant to Section 16 of the Transition and
Separation Agreement.

6. Severability. The provisions of this Release are severable. If any provision
is held to be invalid or unenforceable, it shall not affect the validity or
enforceability of any other provision.

7. Choice of Law. This Release shall in all respects be governed and construed
in accordance with the laws of the State of California, including all matters of
construction, validity and performance, without regard to conflicts of law
principles.

8. Integration Clause. This Release and the Transition and Separation Agreement,
the Confidentiality Agreement, Indemnification Agreement and the Option
Agreements contain the Parties’ entire agreement with regard to the transition
and separation of Executive’s employment, and supersede and replace any prior
agreements as to those matters, whether oral or written. This Release may not be
changed or modified, in whole or in part, except by an instrument in writing
signed by Executive and the Chief Executive Officer of the Company.

9. Execution in Counterparts. This Release may be executed in counterparts with
the same force and effectiveness as though executed in a single document.
Facsimile signatures shall have the same force and effectiveness as original
signatures.

10. Intent to be Bound. The Parties have carefully read this Release in its
entirety; fully understand and agree to its terms and provisions; and intend and
agree that it is final and binding on all Parties.

(Signature page(s) follow)

 

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IN WITNESS WHEREOF, and intending to be legally bound, the Parties have executed
the foregoing on the dates shown below.

 

EXECUTIVE   RAPTOR PHARMACEUTICAL CORP.

 

   

 

Christopher M. Starr, Ph.D.     By:         Title:   Date:  

 

    Date:  

 

 

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