Exhibit 10.3(d)

SEPARATION AND CONSULTING AGREEMENT

This Separation and Consulting Agreement (this “Agreement”) is entered into by
and between Helix BioMedix, Inc. (the “Company”) and Timothy J. Falla, Ph.D
(“Falla”).

WHEREAS, Helix and Falla entered into an Employment Agreement effective as of
July 1, 2003, as amended (the “Employment Agreement”); and

WHEREAS, Falla has resigned from his employment with the Company effective as of
February 28, 2011 (the “Separation Date”); and

WHEREAS, the Company and Falla desire to set forth the terms and conditions
pursuant to which Falla agrees to provide certain consulting services to the
Company following the Separation Date;

NOW THEREFORE, in consideration of the promises made herein, the parties hereby
agree as follows:

1.           Separation of Employment; Transition Activities.  Falla’s last date
of employment with the Company shall be the Separation Date, on which date Falla
also hereby resigns as an officer of the Company.  Falla will continue to work
diligently and perform his duties until the Separation Date and shall be
reasonably available to answer questions regarding any matters related to the
Company for which he was previously responsible for ten (10) months thereafter.

2.           Consulting Services.  In addition to the transition activities
described in Section 1 above, for a period of ten (10) months following the
Separation Date, upon reasonable request Falla hereby agrees to provide
assistance to Company with respect to the maintenance, defense and prosecution
of the Company’s issued patents and pending patent applications and the
preparation and prosecution of patent applications with respect to the Company’s
intellectual property currently in development as of the Separation Date,
including, without limitation, those matters described on Exhibit A hereto.  In
consideration of such services, the Company shall pay Falla an hourly rate of
$125.00, up to a maximum of an aggregate of $35,000 during the term of this
Agreement, and shall reimburse Falla for any reasonable, documented
out-of-pocket expenses incurred in connection with these services and approved
in advance by the Company.  Payment shall be made by the Company within 15 days
of receipt of monthly invoices for same.

3.           No Further Benefits.  Falla acknowledges and represents that,
through the Separation Date, the Company has paid Falla all salary, wages,
bonuses, commissions, profit-sharing, reimbursable expenses, interest, stock,
stock options, fees, accrued vacation and any and all other benefits and
compensation due to Falla.

4.           Stock Options.  All of Falla’s outstanding stock options as of the
Separation Date shall accelerate and be fully vested and immediately exercisable
as of the Separation Date pursuant to their respective terms and conditions and
the terms and conditions of the Company’s 2000 Stock Option Plan, provided that
Falla shall have the following periods after the Separation Date to exercise the
following stock options, after which such stock options will be terminated in
their entirety:
 
 
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Original Grant Date Number of Options Extended Exercise Period  08/01/02 
100,000 02/28/12 07/01/03  180,000  02/28/12 10/30/08  115,000 02/28/12
02/03/10  100,000 02/28/14

                                                                                                                                                                                                                                                                
Except as otherwise set forth in this Section 4, the terms and conditions of
Falla’s outstanding stock options shall remain unchanged.

5.           Waiver and Release.  For and in consideration hereof, Falla, on
behalf of himself and his agents, heirs, successors and assigns, expressly
waives any claims against and releases the Company and its affiliates,
subsidiaries, successors, past and present officers, directors, agents and
employees (collectively, the “Released Parties”) from all claims, causes of
action or liabilities, suspected or unsuspected and irrespective of any present
lack of knowledge of any possible claim or of any fact or circumstances
pertaining thereto, which he may have or could claim to have against the Company
or any of the Released Parties.  This Waiver and Release is intended to be all
encompassing, and without limitation covers all matters arising from or during
the employment of Falla with the Company and/or related to his resignation from
the Company.  This Waiver and Release includes, but is not limited to, claims of
discrimination based on race, color, national origin, sex, marital status, age
(including claims under the Age Discrimination in Employment Act), or physical
or mental disability under any federal, state or local law, rule or regulation;
claims under state or federal law governing the payment of wages; and claims
under any express or implied contract or legal restrictions on the Company’s
right to terminate employees; claims under any employment agreement between
Falla and the Company; and any and all claims based on contract or tort
law.  This Waiver and Release applies to all claims that arose up through the
date hereof (the only exception being a suit filed solely to challenge the
validity of this release under the ADEA).

Falla agrees he has been provided the opportunity to consider whether to enter
into this Waiver and Release and has voluntarily chosen to enter into it on this
date.  Falla acknowledges that he is voluntarily executing this Waiver and
Release, that he has carefully read and fully understands all aspects of this
Waiver and Release, that he has not relied upon any representations or
statements not set forth herein or made by the Company’s agents or
representatives, that he has been advised and been provided the opportunity to
consult with an attorney prior to executing this Waiver and Release.  Falla
further acknowledges that pursuant to applicable law, he has been offered the
opportunity to review a copy of this Waiver and Release for a period of
twenty-one (21) days (the “Review Period”) and that the terms and condition of
this Waiver and Release have not been amended, modified, or revoked during the
Review Period.  Falla and the Company agree that Falla shall have seven (7)
calendar days (the “Revocation Period”) following the date on which he signs
this Agreement to revoke his acceptance of this Waiver and Release, and this
Waiver and Release shall not become effective until the Revocation Period has
expired.
 
 
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Falla represents that he has no lawsuits, claims or actions pending in his name,
or on behalf of any other person or entity, against the Company, and also
represents that he does not intend to bring any claims on his own behalf or on
behalf of any other person or entity against the Company.  Falla agrees that he
will not act in any manner that might damage the business of the Company and
further agrees that he will not knowingly counsel or assist any attorneys or
their clients in the presentation or prosecution of any disputes, differences,
grievances, claims, charges or complaints by any third party against any of the
Released Parties, unless under a subpoena or other court order to do so.
 
6.           No Admission.  Nothing in this Agreement shall be construed as any
indication that the Company or any of the Released Parties has acted wrongfully
towards Falla or any other person.

7.           Employment Agreement.  Falla acknowledges and agrees that those
provisions of the Employment Agreement that by their terms survive any
termination of Falla’s employment with the Company, including without limitation
Sections 6 (“Intellectual Property”), 8(a) (“Restrictive Covenants –
Non-disclosure”), 8(b) (“Restrictive Covenants –Non-interference”) and 8(c)
(“Restrictive Covenants –Non-competition and Non-solicitation”), shall remain in
full force and effect according to their terms following the Separation Date and
shall continue to apply with the same force and effect during the term of this
Agreement in connection with the transition and consulting services rendered by
Falla hereunder; provided, however, that the Company hereby acknowledges and
agrees that the employment of Falla as the Vice President, Research and
Development of Rodan & Fields, LLC shall not in itself constitute a breach of
Section 8(c) of the Employment Agreement, but only so long as Falla remains in
full compliance with the terms and conditions of this Agreement and the other
applicable terms and conditions of the Employment Agreement.

8.           Nondisparagement.  The parties agree to refrain from any
disparaging statements about each other or any of the other Released Parties
including, without limitation, the business, products, intellectual property,
financial standing, future, or employment/compensation/benefit practices of the
Company.

9.           Return of Company Property.  Falla agrees to promptly return to the
Company all documents and other items provided to Falla by the Company,
developed or obtained by Falla in connection with his employment with the
Company, or otherwise belonging to the Company.

10.         Construction of Agreement; Governing Law.  Each party has had a full
and complete opportunity to review this Agreement and has been given the
opportunity to have counsel review it.  Accordingly, the parties agree that the
common law principles of construing ambiguities against the drafter shall have
no application to this Agreement.  Interpretation of this Agreement shall be
under Washington law.  If any such action is necessary to enforce the terms of
this Agreement, the substantially prevailing party shall be entitled to receive
reasonable attorneys’ fees and costs.

11.         No Representations.  Falla represents that in entering into this
Agreement, he does not rely and has not relied upon any representation or
statement made by the Company or any of its employees or agents concerning this
Agreement.
 
 
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12.         Confidentiality.  Falla agrees to keep the terms of this Agreement
confidential, except for communications about it with his immediate family,
attorney or accountants or other professional financial advisors.

13.         Complete Agreement.  This Agreement constitutes a full and final
resolution of all matters in any way related to Falla’s employment with and
resignation from the Company.  This Agreement supersedes any and all other
agreements between the parties other than with respect to the Employment
Agreement as described above and the Company’s 2000 Stock Option Plan and
applicable stock option agreements.

14.         Amendment.  The parties agree that no modification, change or
amendment of this Agreement or any of its provisions shall be valid, unless in
writing and signed by the party against whom such claimed modification, change
or amendment is sought to be enforced.

15.         Severability.  If any provision of this Agreement, or portion
thereof, shall be held invalid or unenforceable by a court of competent
jurisdiction or in any arbitration proceeding, such invalidity or
unenforceability shall attach only to such provision or portion thereof, and
shall not in any way affect or render invalid or unenforceable any other
provision of this Agreement or portion thereof, and this Agreement shall be
carried out as if any such invalid or unenforceable provision or portion thereof
were not contained herein.  In addition, any such invalid or unenforceable
provision shall be deemed, without further action on the part of the parties,
modified, amended or limited to the extent necessary to render the same valid
and enforceable.

16.         Titles.  The titles of the paragraphs of this Agreement are inserted
merely for convenience and ease of reference and shall not affect or modify the
meaning of any of the terms, covenants or conditions of the Agreement.

17.         Counterparts.  This Agreement may be executed in counterparts, each
of which shall be deemed an original, but all of which together shall constitute
one and the same instrument.

IN WITNESS WHEREOF, the parties have executed this Agreement as their free and
voluntary act on the dates set forth below:

COMPANY:

Helix BioMedix, Inc.,
 a Delaware corporation
 

By:           /s/ R. Stephen Beatty                       /s/ Timothy J. Falla  
 
Timothy J. Falla, Ph.D
Its:           President & CEO                           Dated: February 15,
2011   Dated: February 15, 2011

 
 
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Exhibit A

Consulting Services

New patent applications

1.  
Integrate additional data prior to August 20, 2011 conversion of PCT patent
application: T.J.Falla and L.Zhang. Dipeptide copper delivery system. US
application 61/401,842.

2.  
Complete invention disclosure and facilitate initial filing of: T.J.Falla and
L.Zhang. Small molecule elastase inhibitors for skin care.

3.  
Complete invention disclosure and facilitate initial filing of: T.J.Falla and
L.Zhang. Tripeptide antimicrobial peptides.

Existing patent applications

Work with Howrey to respond to office actions related to ongoing PCT, US and
foreign patent applications.

Existing patents

Work with Howrey to ensure payment of maintenance fees for existing US and
foreign patents

General consulting

Provide historical perspective or context needed for ongoing collaborations or
projects
 
 
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