Exhibit 10.1
SEPARATION AGREEMENT AND GENERAL RELEASE
     This Separation Agreement and General Release (“General Release”) is made
and entered into by and between Mariam Morris (“Ms. Morris” or “you”) and
Sucampo Pharmaceuticals, Inc. (“SPI”), a corporation organized under the laws of
the State of Delaware, and its affiliates (hereinafter collectively referred to
as the “Company”).
     WHEREAS, Ms. Morris’ employment will end upon the mutually agreed upon date
of July 31, 2008 (the “Date of Termination”);
     WHEREAS, following the Date of Termination, Ms. Morris will be retained by
the Company as an independent contractor consultant pursuant to the terms of the
Consulting Agreement entered into between the parties on August 1, 2008;
     WHEREAS, Ms. Morris and the Company intend to settle any and all claims
that Ms. Morris may have against the Company as a result of any act, occurrence,
decision, event or omission occurring at any time prior to the signing of this
General Release, including, but not limited to, any matter or fact arising out
of Ms. Morris’ employment with SPI, the termination of Ms. Morris’ employment,
or the events giving rise to this General Release;
     NOW, THEREFORE, in consideration of the provisions and the mutual covenants
contained herein, the parties agree as follows:
     1. Separation from Employment. Effective as of the Date of Termination,
your employment will end. Except as provided in this General Release, all
benefits and privileges of employment shall cease as of that date.
     2. Separation Benefits. In connection with your separation from employment
and in consideration of this General Release:
(a) The Company will pay you the gross amount of $115,500 (equivalent to six
months of your base salary) (the “Severance Payment”), less required deductions
for tax withholding; and
(b) If you elect COBRA continuation of your health insurance coverage, the
Company will pay for the amount of COBRA continuation premium, less the amount
equal to the SPI employee portion of health premiums, for a period ending on the
earlier of (i) a date that is six (6) months following the Date of Termination,
or (ii) the date that you become eligible as an employee or spouse of an
employee of another firm for group medical coverage. Current medical coverage
will continue through the end of July 2008.
(c) The Company will pay you an additional $40,000 gross, less required
deductions for tax withholding, representing a prorated portion of your 2008
Management Bonus target of 30%.

 

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(d) Your rights with respect to any stock options previously awarded to you will
be determined in accordance with the applicable award agreement and the
Company’s Stock Incentive Plan.
     3. Conditions of Payment. You agree you are not entitled to the payments
and benefits referenced in Section 2 unless you remain employed in your current
position through the Date of Termination and unless you sign this General
Release and do not rescind and/or revoke in accordance with Section 6 below.
     4. Terms of Payment. The Severance Payment described in Section 2(a) will
be sent to you at your last address of record within ten (10) days after the
expiration of the revocation period described in Section 6 below, provided you
do not revoke the General Release.
     5. Release of Claims. Ms. Morris and the Company intend to settle any and
all claims that Ms. Morris may have against the Company as a result of the
hiring of Ms. Morris, Ms. Morris’ employment, Ms. Morris’ compensation while
employed, and the termination of Ms. Morris’ employment. Ms. Morris agrees that
in exchange for SPI’s promises in the General Release and in exchange for the
separation pay and benefits to be paid to Ms. Morris as described in the General
Release, Ms. Morris, on behalf of herself and her heirs, successors and assigns,
hereby releases and forever discharges the Company, its predecessors,
successors, and assigns, and their respective officers, directors, shareholders,
agents, employees, and insurers (the “Released Parties”), from all liability for
damages and from all claims that Ms. Morris may have against the Released
Parties arising from or relating to the hiring of Ms. Morris, Ms. Morris’
compensation while employed, Ms. Morris’ employment and the termination of
Ms. Morris’ employment, the terms of the Employment Agreement dated January 2,
2007, as amended, between Ms. Morris and the Company, and any other actions,
decisions, alleged omissions, or events occurring on or prior to the signing of
this General Release.
          A. Ms. Morris understands and agrees that Ms. Morris’ release of
claims in this General Release includes, but is not limited to, any claims
Ms. Morris may have under Title VII of the Federal Civil Rights Act of 1964, as
amended; the Americans with Disabilities Act, the Equal Pay Act, the Employee
Retirement and Income Security Act, the Age Discrimination in Employment Act,
the Older Worker Benefits Protection Act, the Maryland Fair Employment Practices
Act, or any other federal, state, or local statute, ordinance, or law.
          B. Ms. Morris also understands that Ms. Morris is giving up all other
claims, whether grounded in contract or tort theories, including, but not
limited to, wrongful discharge, breach of contract, tortious interference with
contractual relations, promissory estoppel, detrimental reliance, breach of the
implied covenant of good faith and fair dealing, breach of express or implied
promise, breach of manuals or other policies, breach of fiduciary duty, assault,
battery, fraud, invasion of privacy, retaliation, intentional or negligent
misrepresentation, defamation, including libel, slander, discharge defamation
and self-publication defamation, discharge in violation of public policy,
whistleblower, intentional or negligent infliction of emotional distress, or any
other theory, whether legal or equitable.
          C. Ms. Morris will not institute any lawsuit against the Released
Parties arising from or relating to the hiring of Ms. Morris, Ms. Morris’
employment, Ms. Morris’

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compensation while employed, the termination of Ms. Morris’ employment, or any
other actions, decisions, alleged omissions, or events occurring prior to the
signing of this General Release.
          D. To the extent required by law, nothing contained in this General
Release will be interpreted to prevent Ms. Morris from filing a charge with a
governmental agency (such as the Equal Employment Opportunity Commission) or
participating in or cooperating with an investigation conducted by a
governmental agency. However, Ms. Morris agrees that Ms. Morris is waiving the
right to any monetary damages or other individual legal or equitable relief
awarded as a result of any such proceeding related to any claim against the
Released Parties arising from or relating to the hiring of Ms. Morris,
Ms. Morris’ employment, Ms. Morris’ compensation while employed, the termination
of Ms. Morris’ employment, or any other actions, decisions, alleged omissions,
or events occurring on or prior to the signing of this General Release.
          E. Notwithstanding any of the foregoing, this General Release shall
not apply to any rights or benefits Ms. Morris may have related to vested
accrued benefits under the terms of the Company’s benefit plans, if any, or to
her rights under the terms of this General Release itself.
          F. This General Release shall be binding upon, and insure to the
benefit of, Ms. Morris and the Company and their respective successors and
permitted assigns.
          G. Ms. Morris hereby acknowledges and states that Ms. Morris has read
this General Release. Ms. Morris is hereby advised to consult with an attorney
prior to signing this General Release. Ms. Morris further represents that
Ms. Morris has had twenty-one (21) days from receipt of this General Release to
consider the terms of this General Release, and that changes to this General
Release, whether material or immaterial, will not restart this acceptance
period. Ms. Morris further represents that this General Release is written in
language that is understandable to Ms. Morris, that Ms. Morris fully appreciates
the meaning of the terms of this General Release, and that Ms. Morris enters
into this General Release freely and voluntarily.
     6. Right to Revoke. You are entitled to revoke this General Release insofar
as it extends to claims or potential claims arising under the Age Discrimination
in Employment Act by giving notice, in writing, of your intent to revoke within
seven (7) calendar days following the signing of this Release.
     If your revocation is hand-delivered, it must be provided to the Company
within the relevant time period set forth above. If your revocation is mailed,
it must be postmarked within the relevant time period set forth above. If
mailed, your revocation must be sent by certified mail, return receipt
requested. Any revocation must be delivered or mailed to the following address:
Susan Bach
Human Resources
Sucampo Pharmaceuticals, Inc.
4520 East-West Highway, 3rd Floor
Bethesda, MD 20814

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     This General Release will not become effective until the foregoing
revocation period has expired. If you exercise your right to revoke or rescind
any part of this General Release, the Company may, at its option, either nullify
this agreement in its entirety, or keep it in effect in all respects other than
as to that portion of the release of claims that you have revoked or rescinded.
You agree and understand that if the Company chooses to nullify the agreement in
its entirety, the Company will have no obligations under this General Release to
you or to others whose rights derive from you.
     7. Confidentiality. You agree that the existence and terms and conditions
of this General Release shall remain confidential as between the parties, and
may only be disclosed:
(i) by you to immediate family, legal counsel, investment advisor or banks, and
accountant or tax advisor, each of which shall be advised of the confidential
nature of this General Release and who shall each agree to be bound hereby;
(ii) by the Company to its officers and directors, outside auditors, tax
advisors and legal counsel, each of which shall be advised of the confidential
nature of this General Release and who shall each agree to be bound hereby; or
(iii) by either party as necessary to effect its terms or as otherwise required
by law, regulation, court order or valid legal proceeding.
     Without limiting the generality of and subject to the foregoing, you agree
information regarding this General Release shall not be disclosed to any third
party, including, but not limited to, any current or former Company employee.
     8. Agreement with Sucampo Pharmaceuticals, Inc. Relating to Employment
Covenants. You acknowledge that you are obliged to continue to perform your
obligations under the Employment Covenants established in Article 5 of the
Amended Employment Agreement executed on May 12, 2007, between you and the
Company (attached as Exhibit A) and that such obligations shall continue in full
force and effect and be unaffected by this General Release.
     9. Return of Information and Assets. You affirm that all originals and all
copies of the Company’s records, correspondence and documents, and all other
property and assets of the Company, created or obtained by you as a result of or
in the course of or in connection with employment with the Company which are in
your possession or control, whether confidential or not, have been returned to
the Company or will be returned to the Company prior to your signing of this
General Release.
     10. Passwords and Password-Protected Documents. You agree that prior to
signing this General Release, you delivered all passwords in use by you at the
time of your termination, a list of any documents that you created or of which
you are otherwise aware that are password-protected, and the password(s)
necessary to access such password-protected documents.
     11. No Admission. This General Release does not constitute, and shall not
be construed as, an admission of fault or liability of any kind by the Company
and the Company

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expressly denies any fault, liability, wrongdoing or obligation of any kind with
regard to you or any other person employed by the Company.
     12. Governing Law; Severability. This General Release shall be governed by
the laws of the State of Maryland. If any part of this General Release is
construed to be invalid and/or unenforceable, such part shall be modified to
achieve the objective of the parties to the fullest extent permitted and the
balance of this General Release shall remain in full force and effect.
     13. Entire Agreement. This General Release and the documents referenced
herein contain the entire agreement between you and the Company with respect to
your employment and separation from employment and there are no promises or
understandings outside of this General Release and the documents referenced
herein with respect to your employment or your separation from employment with
the Company. Any modification of or addition to this General Release must be in
a writing signed by you and the Company.
     14. Waiver. The waiver by either party of a breach by the other party of
any provision of this General Release shall not operate or be construed as a
waiver of any subsequent breach.
     15. ACKNOWLEDGMENT. BY YOUR SIGNATURE BELOW, YOU ACKNOWLEDGE THAT YOU FULLY
UNDERSTAND AND ACCEPT THE TERMS OF THIS GENERAL RELEASE AND YOU REPRESENT AND
AGREE THAT YOU UNDERSTAND THE MEANING OF THE TERMS OF THIS GENERAL RELEASE AND
THEIR EFFECT. YOU ALSO ACKNOWLEDGE THAT YOUR SIGNATURE IS FREELY, VOLUNTARILY
AND KNOWINGLY GIVEN, HAVING HAD THE OPPORTUNITY TO OBTAIN ADVICE OF COUNSEL AND
HAVING BEEN PROVIDED A FULL OPPORTUNITY AND REASONABLE TIME TO REVIEW AND
REFLECT ON THE TERMS OF THIS GENERAL RELEASE.

              Dated: July 27, 2008   /s/ MARIAM E. MORRIS                  
Mariam M. Morris    
 
            Dated: July 25, 2008   SUCAMPO PHARMACEUTICALS, INC.    
 
           
 
  By   /s/ TIMOTHY I. MAUDLIN    
 
           
 
           
 
  Its   Lead Independent Director    
 
           

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