SEPARATION AGREEMENT AND RELEASE

 

THIS SEPARATION AGREEMENT AND RELEASE (the “Agreement”) which becomes effective
following the expiration of the revocation period set forth below in this
Agreement, is entered into between Navidea Biopharmaceuticals, Inc., on behalf
of itself and its partners, officers, employees and agents, the shareholders,
directors, officers, employees and agents of its partners, and affiliated,
predecessor, successor, and other related companies, and each of them, jointly
and severally (herein singularly and collectively called “Navidea”), and Mark J.
Pykett, V.M.D., Ph.D., on behalf of himself and his heirs, executors, guardians,
administrators, successors, and assigns, and each of them, jointly and severally
(herein singularly and collectively called “Executive”), who together are
sometimes referred to herein as the “Parties” and who agree to be bound by all
of the terms and conditions of this Agreement.

 

WHEREAS, the Parties desire to fully, equitably, and completely settle and
dispose of any and all claims of whatever kind or nature which Executive ever
had, may now have, or may hereafter have, whether known or unknown, against
Navidea, including but not limited to, those claims related to Executive’s
employment with and termination of employment from Navidea.

 

NOW, THEREFORE, in consideration of the mutual agreements of the Parties set
forth below, including the payments to Executive by Navidea provided below, the
receipt and legal sufficiency of which is hereby acknowledged, accepted and
agreed to, the Parties hereby agree as follows:

 

1.            Termination. The Parties confirm that Executive’s employment,
including his service in all offices, positions, titles and capacities he may
hold with Navidea and any of its affiliates, is terminated effective as of 5:00
p.m., Columbus, Ohio time on May 30, 2014 (the “Termination Date”).
Notwithstanding the foregoing, Executive shall: (a) remain a member of Navidea’s
Board of Directors for the balance of his current term expiring at Navidea’s
annual meeting of stockholders in July, 2014, or until his earlier resignation
or removal as a director in conformity with the Bylaws of Navidea, and shall
receive fees and expense reimbursements for such service as are established from
time to time by the Board of Directors and (b) shall serve Navidea in the
capacity of a consultant pursuant to the terms of the Consulting Agreement
attached hereto as Exhibit A (the “Consulting Agreement”). Executive understands
and agrees that he will not be nominated for election as a director for any term
commencing on or after Navidea’s 2014 annual meeting of stockholders. It is
understood and agreed by the Parties that the termination of Executive's
employment qualifies as a “Termination Without Cause” under Section 4.D. of the
Executive's Employment Agreement dated April 15, 2014 (the “Employment
Agreement”). However, notwithstanding the terms of the Employment Agreement,
Executive is not entitled to any payment, benefit, or benefit accrual, or to
participation in any Navidea benefit plan or program, at any time on or after
the Termination Date, except as set forth in this Agreement; and further
provided that Executive shall remain fully covered and insured under Navidea’s
Directors and Officers liability insurance policy and will continue to be named
as a participant thereunder during his term as a Director. Thereafter, Navidea
will use its best commercial efforts to maintain insurance and coverage of
Executive as a former officer and director under Navidea’s Directors and
Officers liability policies, to the fullest extent permitted under Navidea’s
certificate of incorporation, bylaws and applicable Delaware law; provided that
the scope and amount of coverage of Executive shall not be less than that
maintained by the Company for other former officers or directors.

 

 

 

 

2.            Benefits and Payments.

 

2.1.            Payments Through the Termination Date. Executive will be paid
Executive’s current base salary level through the Termination Date, less any and
all applicable deductions and withholdings, and will continue to participate in
all of Navidea’s benefit plans through the Termination Date. Executive shall be
reimbursed for any reasonable business expenses incurred through the Termination
Date in accordance with Navidea’s standard expense reimbursement policies and
practices.

 

2.2.            Payments On or Following the Termination Date. Following the
Termination Date, Navidea will make the following payments to Executive:

 

(a)            Severance. The sum of $750,000, less applicable tax withholdings,
payable in two equal installments by wire transfer in immediately available
funds to the Executive’s account, with the first installment payable on June 9,
2014, and the second installment on January 2, 2015;

 

(b)            Vacation. The sum of $32,277.44, less applicable tax
withholdings, representing Executive’s accrued vacation, floating and personal
days through the Termination Date, payable in a single sum on or before June 9,
2014;

 

(c)            Expense Reimbursement. Payment of Executive’s unreimbursed
business travel, lodging and entertainment expenses incurred through the
Termination Date, in accordance with Navidea's applicable expense reimbursement
policies, including presentation of appropriate documentation; and

 

(d)            Legal Fees and Expenses. Payment to Executive of $10,000 for
Executive’s legal fees and other expenses incurred in the negotiation of this
Agreement and other matters related to his employment or separation, within five
(5) business days following of the Termination Date.

 

2.3.            Equity Awards.

 

(a)            Options. Executive and Navidea confirm that: (i) Executive
currently holds unexercised options to purchase Navidea common shares
aggregating 962,000 common shares (the “Options”) under Navidea’s Fourth Amended
and Restated 2002 Stock Incentive Plan (the “Plan”), and (ii) notwithstanding
anything to the contrary in the Plan, Executive shall remain entitled to
continue to vest in and to exercise the Options in accordance with, and subject
to the restrictions and limitations contained in, the Plan, and the termination
of the Consulting Agreement will be treated as Executive’s “Termination of
Service” for purposes of the Plan. To the extent that the terms of any grant
agreement or equity compensation plan under which Executive’s unexercised
options were awarded may be inconsistent with the preceding sentence, such
agreement is hereby amended to conform therewith.

 

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(b)            Restricted Stock. Executive and Navidea further confirm that (i)
Executive has certain unvested restricted shares of Navidea under two restricted
stock award agreements dated November 15, 2010 (175,000 unvested shares), and
February 17, 2012 (as amended March 17, 2014 (100,000 unvested shares)
(collectively, and as amended herein, the “Award Agreements”). Notwithstanding
any contrary terms in the Award Agreements or the Plan, (x) the 175,000 unvested
shares under the November 15, 2010 Award Agreement shall immediately and
automatically be forfeited and assigned back to Navidea on the Termination Date,
and (y) the vesting schedule contained in the Award Agreement dated February 17,
2012 is hereby amended to read as follows:

 

“One-third (1/3) of the shares vest on each of the first three (3) anniversaries
of the grant date, as follows: 100,000 shares vest on February 17, 2013; 100,000
shares vest on March 17, 2014; and 100,000 shares vest on December 1, 2014. 100%
of the shares vest in the event of a Change of Control of the Company as defined
in the Plan.”

 

Further, the termination of Executive’s employment pursuant to Section 1 of this
Agreement shall not be considered as a termination of his employment with
Navidea for purposes of Section 3.2 of the Award Agreement dated February 17,
2012, but the termination of the Consulting Agreement shall constitute the
termination of Executive’s employment thereunder.

 

(c)            Securities Trading Policies. Notwithstanding anything to the
contrary in this Agreement, Executive's right to exercise options to purchase,
or trade in, Navidea common stock remains subject, for so long as Executive
shall remain a director of Navidea, to Navidea’s Securities Trading Policy for
Officers, Directors and Key Employees, as the same may be amended from time to
time; provided, however, Executive may exercise options to purchase Navidea
common stock for cash at any time after the Termination Date. Executive
acknowledges his continuing obligation to comply with applicable law with
respect to trading in the securities of Navidea and its affiliates.

 

2.4.            Healthcare Coverage. Executive and his spouse and children will
continue to participate in family coverage (including vision and dental
coverage) offered under Navidea’s group health plan, on the same terms and
conditions that are applicable to other executive employees of Navidea during
the term of the Consulting Agreement, and for a period of eighteen (18) months
thereafter will provide continuation of benefits under COBRA in comformity with
the terms of the group health plan. Notwithstanding the foregoing, if Navidea
reasonably determines that such a continuation of health coverage may not be
exempt from federal income tax, Executive shall pay to Navidea an amount equal
to the stated taxable cost of such coverage, and following the expiration of the
such eighteen (18) month period, Executive shall receive from Navidea a
reimbursement of the amounts paid by Executive. Further notwithstanding the
foregoing, in the event that such a continuation of coverage cannot be made
available after the end of the period during which continuation coverage is
generally available under Navidea’s group health plan, Navidea shall assist
Executive in finding other comparable coverage and shall reimburse Executive for
the costs of such coverage so as to make the net benefit to Executive of such
other continued coverage consistent, to the extent reasonably possible, with the
coverage that was available under Navidea’s group health plan during the period
such coverage was permitted to be continued, with such reimbursement to be
provided in a manner consistent with the requirements of Treasury Regulation
Section 1.409A-3(i)(iv). Any such reimbursements shall be subject to the
following conditions: (i) the benefits or payments provided during any taxable
year of Executive may not affect the benefits or payments to be provided to
Executive in any other taxable year; (ii) reimbursement of any eligible expense
must be made on or before the last day of the Executive’s taxable year following
the taxable year in which the expense was incurred; and (iii) the right to such
benefits or payments is not subject to liquidation or exchange for another
benefit or payment.

 

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2.5.            Other Benefit Plans. During the term of the Consulting
Agreement, Executive shall continue to participate in Navidea’s group term life
and disability benefit plans, but his ability to contribute to Navidea’s
flexible spending plan and 401(k) plan (including the employer match provisions)
will terminate on the Termination Date, provided that the foregoing shall not
limit Executive’s right to make withdrawals or transfers from such plans in
accordance with their terms.

 

3.            Release of Claims. By signing this Agreement, and except as
otherwise set forth below in Section 6 of this Agreement, Executive, on behalf
of himself, his spouse, children and any heirs, family members, executors,
administrators, privies and/or assigns (collectively, the “Executive Parties”),
hereby forever releases, waives, and discharges Navidea, its subsidiaries and
affiliates, successors and assigns, and each of its and their past, present and
future officers, directors, agents, managers, supervisors, shareholders,
employees, representatives, insurers, and attorneys (all of whom are
collectively referred to as the “Released Parties”), from any and all claims,
damages, lawsuits, injuries, liabilities, and causes of action that Executive
has or may have, whether known to Executive or not, whether contingent or
liquidated, based on or arising from any event, fact, conduct, condition,
action, or inaction occurring or existing (in whole or in part) on or before the
Termination Date and the Effective Date of this Agreement.

 

4.            Release of All Employment Claims. Without limiting the foregoing
releases, Executive, on behalf of himself and the other Executive Parties,
understands and agrees that the release granted to the Released Parties by
signing this Agreement releases all of the Released Parties from any rights and
claims that could have been asserted under any city ordinance or state or
federal law including, without limitation, those based on or relating to
discrimination or retaliation based on race, religion, sex, handicap,
disability, equal pay, age, national origin, creed, color, sexual orientation,
gender identify, military/veteran status, retaliation, and harassment/hostile
work environment, and includes claims under any applicable state, local or
federal discrimination law, including without limitation, Title VII of the 1964
Civil Rights Act, the Civil Rights Act of 1991, the Fair Labor Standards Act,
the Labor Management Relations Act, the Equal Pay Act, the Americans with
Disabilities Act, the Family Medical Leave Act, the Employee Retirement Income
Security Act, the Age Discrimination in Employment Act of 1967 as amended by the
Older Workers Benefit Protection Act, the Consolidated Omnibus Budget
Reconciliation Act, the Ohio Civil Rights Act, Workers’ Compensation laws,
Unemployment Compensation laws, Whistleblower laws including Sarbanes-Oxley,
Frank-Dodd and Ohio Revised Code §§ 4123.90 and 4152, 42 U.S.C. §§ 1981, 1983,
1985, and all laws, statutory or common, which are meant to protect employees in
their employment relationships and under which Executive may have rights and
claims, whether known to Executive or not, which may have arisen or which may
hereafter arise, directly or indirectly, out of Executive's employment with,
service to, or separation from Navidea. This release includes but is in no way
limited to all claims of discrimination, harassment, retaliation, wrongful
discharge, whistleblower, wage and hour violations, breach of implied contract,
all equitable claims, negligent or intentional infliction of emotional distress,
outrageous conduct, libel, slander, defamation, and/or any claims concerning any
emotional or physical injury, arising out of or related in any way to
Executive’s employment with, service to, or separation from Navidea.

 

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5.            Waiver of All Known and Unknown Claims. In making this Agreement,
Executive, on behalf of himself and the other Executive Parties, acknowledges
that he may later discover facts different from or in addition to those now
known or believed to be true at this time. The releases and waivers contained in
this Agreement are made notwithstanding the existence of any such different or
additional facts. Executive further acknowledges that he may hereafter discover
claims or facts in addition to or different from those which he now knows or
believes to exist in connection with this Agreement. Those facts, if known or
suspected at the time of executing this Agreement, may have materially affected
this Agreement. Nevertheless, Executive waives any rights, claims or causes of
action that might arise as a result of such different or additional claims or
facts.

 

6.            Exceptions from Release and Waiver. Notwithstanding anything to
the contrary in this Agreement, the releases and waivers by Executive set forth
in this Agreement do not apply to: (i) any indemnification right, benefit or
claim that Executive may have with respect to matters arising out of his service
as an officer or director of Navidea or of any of its affiliates under Navidea’s
officer and director liability insurance policies, Navidea’s certificate of
incorporation or bylaws, applicable law, or any written agreement to which
Executive is a party, (ii) any right, benefit or claim that Executive may have
under this Agreement, (iii) any right, benefit, entitlement or privilege that
arises under any other written agreement or instrument and that is expressly
preserved by this Agreement, or (iv) any right, benefit or claim of Executive
under the Employment Agreement through the Termination Date.

 

7.            Navidea’s Release of Claims. By signing this Agreement, and except
as otherwise set forth below, Navidea, on behalf of itself and the other
Released Parties, hereby forever releases, waives, and discharges Executive and
the other Executive Parties from any and all claims, damages, lawsuits,
injuries, liabilities, and causes of action that Navidea has or may have,
whether known to Navidea or not, whether contingent or liquidated, based on or
arising from any event, fact, conduct, condition, action, or inaction occurring
or existing (in whole or in part) on or before the Termination Date and the
Effective Date, except that, notwithstanding anything to the contrary in this
Agreement, the releases and waivers by Navidea set forth in this Agreement do
not apply to (i) any right or claim that Navidea may have under Navidea’s
officer and director liability insurance policies, Navidea’s certificate of
incorporation or bylaws, applicable law, or any agreement to which Navidea is a
party, in connection with any assertion by Executive of any right to or claim
for indemnity, (ii) any right or claim that Navidea may have under this
Agreement, (iii) any right, entitlement or privilege of Navidea under Sections 5
or 6 of the Employment Agreement, or under the Proprietary Information Agreement
between Executive and Navidea dated April 1, 2014 (“Proprietary Information
Agreement”), that expressly survives the termination of either such agreement,
(iv) any right or claim that Navidea may have against Executive arising from or
in connection with the assertion or undertaking of any claim, investigation or
proceeding by any regulatory or other governmental agency or entity or any third
party, or (v) any right that Navidea may have to contest any assertion by
Executive that his separation from employment and service with Navidea occurred
as a result of a Change In Control within the meaning of the Employment
Agreement, or any other right that Navidea may have in connection with any such
assertion by Executive. Navidea shall in no event have any right to offset the
severance payments provided for in Section 2.2(a) hereof or any other payment to
be made under this Agreement, against any claim that may exist or arise (and
that is not released pursuant to this Section 7).

 

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8.            Compliance with Older Workers’ Benefit Protection Act. The Parties
desire and intend that this Agreement comply with the terms of the Older
Workers’ Benefit Protection Act. Accordingly, Executive acknowledges that he has
been advised of the following rights:

 

8.1.            Executive understands that local, state and federal laws,
including the Age Discrimination in Employment Act, prohibit employment
discrimination based upon age, sex, race, color, national origin, ethnicity,
religion, disability, and other protected classifications. Executive further
understands and agrees that, by signing this Agreement, he agrees to waive any
and all such claims, and releases the Released Parties from any and all such
claims.

 

8.2.            Executive acknowledges that he has been advised by this writing
to consult with an attorney and has been provided with a reasonable opportunity
to do so prior to signing this Agreement, which contains a general release and
waiver of claims.

 

8.3.            Executive acknowledges that consideration offered in exchange
for his release of claims exceeds in kind and scope that to which he would have
otherwise been entitled.

 

8.4.            Executive acknowledges that he has had at least twenty-one (21)
calendar days in which to review and consider this Agreement and to consult with
legal counsel with respect thereto. To the extent Executive has taken less than
twenty-one (21) calendar days to consider this Agreement, Executive acknowledges
that he has had sufficient time to consider this Agreement. Executive further
acknowledges that this Agreement is written clearly in a manner and in terms
which he understands, and he has entered into this Agreement voluntarily and of
Executive’s own free will.

 

8.5.            Executive acknowledges Executive's right to revoke this
Agreement within (7) seven days following the execution hereof by giving timely
written notice thereof to Navidea, attention Brent L. Larson, Chief Financial
Officer at blarson@navidea.com. In the event of such revocation, this Agreement
shall become null and void and the Parties hereto shall have no rights or
obligations hereunder. This Agreement, including any payment or provision of
benefits to Executive by Navidea under this Agreement, shall not become
effective or enforceable until the revocation period has expired. The Parties
also agree that any of their discussions, negotiations, or change in terms to
this Agreement will not restart the twenty-one (21) day period for Executive to
review and consider this Agreement.

 

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9.            No Admission by Navidea or Released Parties. Executive understands
that neither this Agreement nor any action taken under it is or should be
construed as an admission by any of the Released Parties that they have violated
any local, state or federal law, statutory or common. The Released Parties
specifically disclaim any liability to or wrongful acts against Executive or any
other person.

 

10.            Confidentiality; Non Competition.

 

10.1.            Confidentiality of Agreement. Executive agrees and acknowledges
that the terms and provisions of this Agreement, including the amounts to be
paid to Executive, shall be and have been kept in utter, absolute, and strictest
confidence, and that Executive has not released and shall never reveal any such
information to any individual or entity except that Executive may provide
information about this Agreement as follows: (a) as required by any governmental
agency or by process of law; (b) to an attorney who is assisting Executive in
negotiating this Agreement; (c) to a professional accountant, tax consultant or
financial planner with whom Executive has a confidential relationship; and (d)
to Executive’s immediate family members, which only includes a spouse, parents
and siblings residing with Executive, subject, in each case, to each such
individual and entity being informed of this confidentiality obligation and
agreeing to keep such information confidential. Executive’s obligations under
this Section 10.1 shall be excused to the extent of any disclosure of this
Agreement or its terms made by Navidea under the United States federal
securities laws.

 

10.2.            Obligations Under Proprietary Information Agreement. Executive
acknowledges that as of the Termination Date he has returned to Navidea (and
will not keep in his possession or deliver to anyone else) any and all devices,
records, data, notes, reports, proposals, lists, correspondence, specifications,
drawings, blueprints, sketches, materials, equipment, other documents or
property, or reproductions of any aforementioned items (whether in magnetic
media or otherwise) belonging to Navidea, its successors or assigns. Executive
agrees to sign and deliver to Navidea on or before the Termination Date the
“Termination Certification” attached to the Proprietary Information Agreement as
Schedule C. Executive acknowledges and agrees that the categories of information
described in Section 1 of the Proprietary Information Agreement are solely the
property of Navidea and constitute trade secrets and confidential information of
Navidea, and that he has not retained and will not retain any originals, copies,
duplications, or reproductions thereof, and that his post-employment obligations
under the Proprietary Information Agreement will shall remain binding and in
effect in addition to this Agreement.

 

10.3.            Non-Competition. Executive acknowledges and agrees that, except
as hereinafter noted, the provisions of Section 6 of the Employment Agreement
shall remain binding and in effect in addition to this Agreement for a period of
one (1) year following the Termination Date, and further acknowledges that
similar restrictions are imposed under the Consulting Agreement, which will
apply during the term of the Consulting Agreement and for a period of one (1)
year following the earlier to occur of its termination or the expiration of its
term. Notwithstanding anything to the contrary, it is agreed and understood that
for purposes of this Agreement and the Consulting Agreement of even date, the
definition of the Competitive Business as defined in Article 6 of the Employment
Agreement between the parties is amended as provided below, and “Competitive
Business” for purposes of this Agreement and the Employment Agreement shall mean
any business or enterprise which:

 

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i.is engaged anywhere in the world in (A) the development and/or
commercialization of products and/or systems for use in the pre-operative or
intraoperative detection of cancer, (B) the development and/or commercialization
of radiopharmaceuticals or other imaging or contrast agents (i) for use in
lymphoscintigraphy or lymphatic mapping, (ii) that bind to mannose receptors; or
(iii) for use in the diagnosis of 1) breast cancer, melanoma, or head and neck
cancer, 2) Alzheimer’s disease, dementia or mild cognitive impairment; 3)
Parkinson’s disease, tremor or movement disorders, 4) rheumatoid arthritis, 5)
Kaposi’s sarcoma, 6) vulnerable plaque, or 7) tuberculosis.

 

ii.is reasonably understood to be competitive in any geographic market or
product market with products and/or systems described in clause i above, or

 

iii.Navidea engages in during the term of this Agreement pursuant to a
determination of the Board, and from which Navidea derives revenue or in which
Navidea has made a capital investment.

 

11.            No Filing of Claims. Executive represents that he has no pending
charges, claims, suits, arbitration, complaints or grievances against the
Released Parties with any federal, state, local or other governmental agency, or
in any court of law, or before any arbitration association, and has not suffered
any work-related injury or illness within two year prior to the effective date
of this Agreement. Executive agrees not to assert any claim(s) release by
Paragraph 7 of this Agreement in any lawsuit he may bring against the Released
Parties. Executive further agrees that if any such claims) is or are asserted in
any lawsuit brought by the Executive against the Released Parties, the Released
Parties are entitled to recover any damages they suffer as a result of Executive
breaching this Paragraph, as well as any and all reasonable attorneys’ fees and
all other reasonable costs incurred in obtaining dismissal of the claim(s).
Executive, however, maintains the right to file any action for the sole purpose
of enforcing rights under this Agreement, based solely on events arising after
entering into this Agreement.

 

12.            No Monetary Relief. Nothing in this Agreement shall preclude
Executive from filing and administrative charge with the Equal Employment
Opportunity Commission or the Ohio Civil Rights Commission. Executive, however,
expressly waives and releases any right he may have to recover any monetary
relief resulting from such a charge or any action or suit that may be instituted
on his behalf against the Released Parties by the Equal Employment Opportunity
Commission of the Ohio Civil Rights Commission, or in any class or collective
action that may be filed on his behalf.

 

13.            Taxation. Executive understands and agrees that some of the
amounts set forth herein are subject to tax withholdings and FICA. Executive
agrees that none of the Released Parties or their representatives or agents have
made any other representations or promises about the tax implications of the
sums Executive is to receive in connection with the settlement memorialized in
this Agreement. Navidea shall consult with Executive in determining the proper
tax jurisdiction of any payments to be made hereunder and as to whether any
withholding is required and will reasonably cooperate with Executive with
respect to claims of or against taxing authorities regarding the amount of any
required withholding.

 

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14.            Nondisparagement. From and after the Termination Date, Navidea
shall, in all public communications authorized through its normal approval
channels, and shall cause its directors and officers at or above the vice
president level (during their time of service with Navidea), to refrain from
intentionally making derogatory or disparaging remarks about Executive, and
Executive shall refrain from intentionally making derogatory or disparaging
remarks about Navidea, in each case whether with respect to employment,
business, or financial matters or otherwise.

 

15.            Right to Consult with Attorney and Voluntary Signing. Executive
acknowledges that Executive has consulted with an attorney before signing this
Agreement, that Executive has read this Agreement carefully, that Executive
understands each of its provisions, and that Executive has signed it
voluntarily. Executive further acknowledges that Navidea has taken no action
interfering with any right which Executive has to file any charge, suit, claim
or other process with any federal, state, or local judicial or administrative
agency or body regarding Executive's employment or retirement or any right to
contact or seek the guidance or intervention of any such agency.

 

16.            Compliance. In the event that Executive, or any person, entity,
or organization authorized by him, breaches or threatens to breach any of the
Executive’s obligations and promises made in this Agreement, Navidea reserves
the right to terminate its payment obligations under this Agreement at any time.
In addition, if Navidea has to defend or pursue any suit, complaint, claim,
and/or injunctive relief as a result of any such breach or threatened breach by
Executive, Executive shall be liable to Navidea for all damages, reasonable
attorneys’ fees, expenses, and costs (including investigation and discovery
costs) incurred by Navidea in connection with the same, as well as for all funds
paid to him, or on Executive’s behalf, under this Agreement. All such sums shall
be paid to Navidea upon written notice to Executive demanding the same. This
Section 16 shall not apply if the imposition of such liability or the refunding
of such amounts (a) is not legally enforceable under Ohio law, or (b) conflicts
with the provisions of Section 17 below.

 

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17.            Resolution of Disputes. Executive and Navidea further agree that
all future disputes they may have concerning their obligations under this
Agreement will be submitted to binding arbitration, including any disputes over
the enforcement of the terms of this Agreement, excepting only potential claims
relating to a request for equitable relief from a court of competent
jurisdiction to enjoin a violation or threatened violation of this Agreement and
to preserve the status quo pending the arbitration proceedings required under
this Section 17. If either party contends that they have a claim of any kind
against the other, or that any provisions of this Agreement are not being
complied with, written notice of alleged non-compliance shall be given to the
other party within thirty (30) calendar days of notice of the alleged dispute or
non-compliance. Such written notice must be either hand delivered or sent by
certified mail to the party's last known address on or before the 30th day. The
party receiving such notice shall have five (5) business days from receipt of
such written notice to resolve the alleged dispute(s) or non-compliance through
mutual efforts of conciliation. The Parties may mutually agree in writing upon
additional time to endeavor to resolve the alleged dispute(s) or non-compliance.
In the event the Parties are unable to conciliate the dispute(s) or
non-compliance within the five (5) business days mentioned above (or within the
additional period of time to which the Parties may have mutually agreed), at the
conclusion of the five-day business period the Parties agree to submit the
dispute(s) or issue(s) of non-compliance to binding arbitration, upon the
request of either party if made within sixty (60) calendar days starting with
the day after the five-day period ends. The binding arbitration shall be
administered by the American Arbitration Association (“AAA”) under its
Employment Dispute Resolution Arbitration Rules. The arbitration shall take
place in Columbus, Ohio. The arbitrator's award shall be accepted as final and
binding upon the Parties. The entire arbitration proceeding and any award or
decision relating thereto shall be kept completely confidential by AAA, the
arbitrator, the Parties and any non-party witnesses. In the event of arbitration
instituted under this Agreement, Executive and Navidea each shall be responsible
for half of the full payment of the arbitrator’s fee, as well as the expenses of
the arbitration, excluding their own costs and attorney’s fees, for which each
party shall remain solely responsible. However, the arbitrator has the power to
award all or a portion of costs and attorneys’ fees to a prevailing party, or to
the other party if the arbitrator determines that a party has made a frivolous
claim or defense, where the arbitrator decides that such an award is just. In
any arbitration instituted under this Agreement, the arbitrator shall have the
authority to render a decision in accordance with applicable state and/or
federal law and to award any and all appropriate damages including the
forfeiture of any monies already paid pursuant to this Agreement, and any other
legal or equitable relief, including restitution of the arbitrator’s fee to the
prevailing party. This agreement to arbitrate may be compelled under the Federal
Arbitration Act.

 

18.            Governing Law; Exclusive Jurisdiction and Venue. This agreement
shall be governed by and construed in accordance with the laws of the State of
Ohio, without reference to its principles of conflicts of laws. Each of the
Parties: (a) agrees that any legal suit, action or proceeding arising out of or
relating to this Agreement, including any action to enforce the provisions of
Section 17 or any arbitration award thereunder, shall be instituted exclusively
in the Court of Common Pleas of Franklin County, Ohio or in the United States
District Court for the Southern District of Ohio, (b) waives any objection which
such Party may have now or hereafter to the venue of any such suit, action or
proceeding, and (c) irrevocably consents to the jurisdiction of the foregoing
named courts in any such suit, action or proceeding. Each of the Parties further
agrees to accept and acknowledge service of any and all process which may be
served in any suit, action or proceeding in the foregoing courts, and agrees
that service of process upon such Party mailed by certified mail to the address
of the recipient most recently provided in writing by such Party to the other
Party at the time of such service shall be deemed in every respect effective
service of process upon Navidea in any such suit, action or proceeding. In the
event of litigation between the parties arising hereunder, the prevailing party
shall be entitled to costs and reasonable attorney's fees.

 

19.            Code Section 409A. It is intended that this Agreement shall
comply with the provisions of Section 409A of the Internal Revenue Code of 1986,
as amended, and the Treasury regulations relating thereto, or an applicable
exemption (“Code Section 409A”). The termination of employment under this
Agreement is intended to be a “separation from service” under Code Section 409A.
Further, the parties acknowledge and agree that the severance payments provided
for in Section 2.2(a) qualify for exemption from Code Section 409A under the
short-term deferral rules of Treasury Regulation Section 1.409A-1(b)(4).Each
payment of compensation or severance pay under this Agreement shall be treated
as a separate payment of compensation for purposes of Code Section 409A. No
payments to be made under this Agreement may be accelerated or deferred, except
as specifically permitted under Code Section 409A. In no event may the
Executive, directly or indirectly, designate the calendar year of any payment
under this Agreement

 

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20.            Use of Headings; Entire Agreement; Modifications. The headings in
this Agreement have been inserted for convenience of reference only and do not
in any way restrict or modify any of its terms or provisions. This Agreement
sets forth the entire agreement between the Parties hereto, and there are no
inducements or representations, other than those contained in this Agreement,
upon which the Parties are relying in executing this Agreement.

 

21.            Severability. All provisions of this Agreement are severable and
this Agreement shall be interpreted and enforced as if all completely invalid or
unenforceable provisions were not contained therein, and Executive and Navidea
agree that this Agreement shall be enforced to the fullest extent permissible
under the laws and public policies applied in the jurisdiction in which
enforcement is sought. If any provision of this Agreement is invalid or
unenforceable, that invalidity or unenforceability will not affect any of the
other terms and conditions contained in this Agreement.

 

22.            Assignment. This Agreement may be freely assigned by Navidea, for
any purpose, with or without notice, shall inure to the benefit of any
successors or assigns of Navidea, and shall be binding upon the heirs,
executors, and administrators of Executive. Notwithstanding the foregoing, it is
agreed and understood that for any assignment by Navidea to be effective, the
Assignee must agree in writing to be bound by all of the terms and conditions of
this Agreement and the Consulting Agreement.

 

23.            Entire Agreement. The Parties hereto agree that this Agreement
and the Consulting Agreement constitute the entire agreement between them with
respect to Executive’s employment with Navidea and, except as otherwise provided
herein, supersede all prior agreements and understandings existing between them,
written or oral, express or implied, whether or not within the knowledge or
contemplation of either or both Parties, pertaining to any matter covered by
this Agreement. Notwithstanding anything contained herein to the contrary, this
Agreement and the Consulting Agreement shall not be deemed to amend, invalidate
or in any manner affect the enforceability of Executive’s post-termination
obligations under the Employment Agreement and the Proprietary Information
Agreement referenced in Sections 10.2 and 10.3, and Executive shall continue to
be bound by such terms and provisions of such agreements.

 

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24.            Effective Date. This Agreement shall become effective after the
Parties’ execution of this Agreement and the expiration of the seven-day
revocation period set forth in Section 8.5 and the following paragraph
(“Effective Date”).

 

EXECUTIVE ACKNOWLEDGES THAT HE HAS READ THE FOREGOING SEVERANCE AGREEMENT AND
RELEASE, THAT IT IS WRITTEN IN A CLEAR AND UNDERSTANDABLE MANNER, AND HE FULLY
UNDERSTANDS ITS TERMS. EXECUTIVE ALSO ACKNOWLEDGES THAT HE WAS GIVEN UP TO
TWENTY-ONE (21) CALENDAR DAYS WITHIN WHICH TO CONSIDER THIS AGREEMENT, THAT HE
WAS ADVISED TO CONSULT WITH LEGAL COUNSEL PRIOR TO SIGNING THIS AGREEMENT, AND
THAT HE HAS THE RIGHT TO REVOKE THIS AGREEMENT, IN WRITING, FOR A PERIOD NOT TO
EXCEED SEVEN (7) CALENDAR DAYS AFTER THE DATE ON WHICH IT WAS SIGNED BY HIM.
EXECUTIVE FURTHER ACKNOWLEDGES THAT IF HE FAILS TO EXERCISE THIS RIGHT TO
REVOKE, THIS AGREEMENT WILL IMMEDIATELY BECOME A BINDING CONTRACT AS TO ITS
TERMS. EXECUTIVE NOW VOLUNTARILY SIGNS THIS AGREEMENT ON THE DATE INDICATED,
SIGNIFYING HIS AGREEMENT AND WILLINGNESS TO BE BOUND BY ITS TERMS.

 

IN WITNESS WHEREOF, the Parties hereto have read the foregoing Agreement,
understand the same, and agree to all of the provisions contained herein as of
the Effective Date.

 

NAVIDEA CORPORATION   EXECUTIVE                           By: /s/ Gordon A.
Troup   /s/ Mark J. Pykett     Gordon A. Troup, Chairman   Mark J. Pykett,
V.M.D., Ph.D.               Date: 05/31/14   Date: 05/31/14  

 

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