Exhibit 10.1

SETTLEMENT AGREEMENT AND RELEASE OF CLAIMS

This Settlement Agreement and Release of Claims (the “Agreement”) is entered
into by and between Andrew L. Graham (the “Executive”) and Trimeris, Inc. (the
“Company”). Collectively, the Executive and the Company are hereinafter referred
to as the “Parties.”

WHEREAS, the Executive has most recently been employed by the Company as its
Chief Financial Officer and Secretary pursuant to an employment agreement dated
January 24, 2008, as amended to date (the “Employment Agreement”);

WHEREAS, the Executive has ceased to be Chief Financial Officer and Secretary as
of November 18, 2010, and

WHEREAS, the Executive must sign and return this Agreement by December 22, 2010
and the Supplemental Release of Claims (the “Supplemental Release”), attached
hereto as Exhibit A, no earlier than close of business on the Termination Date
(as defined below) and no later than three business days thereafter.

NOW THEREFORE, in consideration of the promises contained herein, the receipt
and sufficiency of which is hereby acknowledged by the Parties, the Company and
the Executive agree as follows:

1. Termination and Notice Period. The Executive’s effective date of termination
from the Company is January 17, 2011 or such earlier date as the Company and the
Executive mutually agree is the last day of employment (the “Termination Date”).
The period of time between the date the Executive receives this Agreement and
the Termination Date is defined as the Notice Period. Pursuant to
Section 5(a)(i) of the Employment Agreement, the Company is placing the
Executive on administrative leave for the duration of the Notice Period, during
which period the Executive will not have access to the Company’s electronic
communications system, including, but not limited to, the Company’s voicemail
and email systems, and the Executive is prohibited from conducting business on
behalf of the Company unless otherwise authorized to do so by the Company’s
Chief Executive Officer. Notwithstanding the foregoing, the Executive agrees to
be available by phone to assist the Company in transitioning his duties and
perform other tasks as requested by the Company during the Notice Period. During
the Notice Period, the Company will continue to pay the Executive his base
salary, less all applicable taxes and withholdings, make its matching
contribution to the Company’s 401(k) plan for 2010, and provide other customary
benefits, as well as any customary monthly charges incurred for the Executive’s
cellular phone during this period. Executive will receive his final regular pay
check, together with any accrued and unused vacation pay, as well as
reimbursement for any substantiated but unreimbursed business expenses, on the
Termination Date.

2. Description of Severance Benefits. Pursuant to Sections 6(d)(i), 6(d)(ii) and
6(e) of the Employment Agreement, and in return for the Executive’s timely

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execution and return of this Agreement and the Supplemental Release, and his
compliance with the terms of both agreements, the Company agrees to provide the
Executive with the following severance benefits:

(a) The Company will pay the Executive $180,264.00, less applicable taxes and
withholdings, which is an amount equivalent to 12 months of his current base
salary rate (the “severance pay”). This severance pay shall be paid in one
lump-sum payment in accordance with the Company’s normal payroll practices on
the 60th day following the Termination Date.

(b) The Executive and his spouse and dependents shall be entitled to continue to
be covered by the Company’s group medical and dental plans, if such plans then
exist, or any subsequent individual medical and dental insurance policy obtained
by and covering the Executive and his spouse and dependents, and the Company
will pay the premiums for such coverage in an amount equal to the amount that it
pays (or formerly paid, if that plan is discontinued) on behalf of other
employees who receive the same type of coverage until the earlier of the first
anniversary of the Termination Date or the date he becomes covered under a
subsequent employer’s medical or dental plan (as applicable), but with the
amount payable during this period not to exceed $25,000. Nothing in this
Agreement requires the Company to maintain or provide any medical or dental
coverage.

3. Release of Claims. In partial consideration for the severance benefits, which
the Executive acknowledges he would not otherwise be entitled to receive, the
Executive on behalf of himself and his successors, assigns, and agents hereby
fully, forever, irrevocably and unconditionally releases, remises and forever
discharges the Company and its predecessors, successors, affiliates,
subsidiaries, parent companies, and assigns, and all of its and their respective
past and present agents, directors, officers, partners, members, donors, plan
administrators, fiduciaries, insurers, attorneys and employees (collectively
“Releasees”) from any and all claims, charges, complaints, demands, actions,
causes of action, suits, rights, debts, sums of money, costs, accounts,
reckonings, covenants, contracts, agreements, promises, doings, omissions,
damages, executions, obligations, liabilities and expenses (including attorneys’
fees and costs), whether known or unknown, of every kind and nature that the
Executive has ever had or now has against any or all of the Releasees,
including, but not limited to, any and all claims arising out of or relating to
the Executive’s employment with the Company, including, but not limited to, all
claims under Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et
seq., the Genetic Information and Nondiscrimination Act of 2008, 42 U.S.C. §
2000ff et seq., the Americans with Disabilities Act of 1990, 42 U.S.C. § 12101
et seq., the Family and Medical Leave Act, 29 U.S.C. § 2601 et seq., the Fair
Credit Reporting Act, 15 U.S.C. § 1681 et seq., the Rehabilitation Act of 1973,
29 U.S.C. § 701 et seq., Executive Order 11246, Executive Order 11141, the
Employee Retirement Income Security Act of 1974 (“ERISA”), 19 U.S.C. § 1001 et
seq., the North Carolina Equal Employment Practices Act, N.C. Gen. Stat.
§ 143-422.1 et seq., the North Carolina Persons with Disabilities Protection
Act, N.C. Gen. Stat. § 168A-1 et seq., the North Carolina Retaliatory Employment
Discrimination Act, N.C. Gen. Stat. § 95-240 et seq., the North Carolina
Hazardous Chemicals Right to Know Act, N.C. Gen. Stat. § 95-173 et seq., and
N.C. Gen. Stat. § 95-151 (North Carolina prohibition against discrimination

 

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under the Occupational Safety and Health Act of North Carolina), all as amended;
and all common law claims including, but not limited to, actions in tort,
defamation, intentional infliction of emotional distress, fraud,
misrepresentation, wrongful discharge and breach of contract, including, but not
limited to, any claims arising from or related to the Employment Agreement and
any predecessor employment agreements entered into between the Company and the
Executive; and any claim or damage arising out of the Executive’s employment
with the Company (including a claim for retaliation) under any common law theory
or any federal, state or local statute or ordinance not expressly referenced
above; provided, however, that nothing in this Agreement prevents the Executive
from filing a charge with, cooperating with, or participating in any proceeding
before the EEOC or a state fair employment practices agency (except that the
Executive acknowledges that he may not recover any monetary benefits in
connection with any such claim, charge or proceeding).

The Company agrees that the Executive is not releasing any claims or rights that
he may have for indemnification under state or other law or the charter or
by-laws of the Company, or under any indemnification agreement with the Company
or under any insurance policy providing directors’ and officers’ coverage for
any lawsuit or claim relating to the period when he was an officer of the
Company; provided, however, that (i) the Company’s execution of this Release is
not a concession or acknowledgment that the Executive has any such rights to
indemnification, (ii) this Release does not create for the Executive any
additional rights to indemnification, and (iii) the Company retains any and all
defenses it may have to such indemnification or coverage.

4. Continuing Obligations. The Executive acknowledges and reaffirms his
obligation to keep confidential and not to disclose any and all non-public
information concerning the Company that he acquired during the course of his
employment with the Company, including, but not limited to, any non-public
information concerning the Company’s business affairs, business prospects and
financial condition, as is stated more fully in Section 7 of the Employment
Agreement, which section remains in full force and effect. The Executive also
acknowledges and reaffirms his other obligations under Section 7 of the
Employment Agreement, including, but not limited to, his noncompetition and
nonsolicitation obligations.

5. Return of Company Property. The Executive confirms that by January 17, 2011
he will have returned to the Company in good working order all keys, files,
records (and copies thereof), equipment (including, but not limited to, computer
hardware, software and printers, pagers, etc.), Company identification, Company
confidential and proprietary information, Company vehicles and any other
Company-owned property in his possession or control and will have left intact
all electronic Company documents, including, but not limited to, those which he
developed or helped to develop during his employment. The Executive further
confirms that by January 17, 2011 he will have cancelled all accounts for his
benefit, if any, in the Company’s name, including but not limited to, credit
cards, telephone charge cards, cellular phone, wireless handheld device and/or
pager accounts and computer accounts. Executive may retain his wireless handheld
device subject to his removing and not retaining copies of any

 

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Company confidential and proprietary information on such device. The Company
will pay any early termination fees related to transfer of the Executive’s
wireless handheld device account from the Company’s name to the Executive’s name
as a part of the Executive’s final expense report.

6. Confidentiality. To the extent permitted by law, the Executive and the
Company understand and agree that the negotiations and discussions resulting in
this Agreement and the Supplemental Release shall be maintained as confidential
by the Executive and his agents, representatives and immediate family members
and by the Company, its Board members, and its officers and shall not be
disclosed except to the extent required by federal or state law or as otherwise
agreed to in writing by the Company and the Executive.

7. Non-Disparagement. The Executive understands and agrees that he will not make
any false, disparaging or derogatory statements to any person or entity,
including any media outlet, industry group, financial institution or current or
former employee, partner, donor, consultant, client, or customer of the Company,
regarding the Company or any of the other Releasees or about the Company’s
business affairs and financial condition; provided, however, that nothing herein
prevents him from making truthful disclosures to any governmental entities where
required by applicable law. The Company agrees that the members of the Board and
the officers of the Company will not make any false, disparaging or derogatory
statements to any person or entity, including any media outlet, regarding the
Executive’s service with the Company; provided, however, that nothing herein
prevents them from making truthful disclosures to any governmental entities
where required by applicable law.

8. Nature of Agreement. The Executive understands and agrees that this Agreement
and the Supplemental Release are a settlement agreement and do not constitute an
admission of liability or wrongdoing on the part of the Company.

9. Acknowledgements. The Executive acknowledges that he has been given at least
seven days to consider this Agreement and that the Company has advised him to
consult with an attorney of his own choosing prior to signing this Agreement.

10. Voluntary Assent. The Executive affirms that no other promises or agreements
of any kind have been made to or with him by any person or entity whatsoever to
cause him to sign this Agreement or the Supplemental Release, and that he fully
understands the meaning and intent of this Agreement and the Supplemental
Release. The Executive states and represents that he has had an opportunity to
discuss fully and review the terms of this Agreement and the Supplemental
Release with an attorney. The Executive further states and represents that he
has carefully read this Agreement and the Supplemental Release, understands the
contents herein and therein, freely and voluntarily assents to all of the terms
and conditions hereof and thereof, and signs his name of his own free act.

 

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11. Validity. Should any provision of this Agreement or the Supplemental Release
be declared or be determined by any court of competent jurisdiction to be
illegal or invalid, the validity of the remaining parts, terms or provisions
shall not be affected thereby and said illegal or invalid part, term or
provision shall be deemed not to be a part of this Agreement or the Supplemental
Release, as applicable. Notwithstanding the foregoing, if the Executive’s
release and waiver pursuant to Section 3 of this Agreement or the Supplemental
Release is found to be unenforceable, the Executive agrees that he will either
sign a valid release and waiver of claims in favor of the Releasees, as drafted
by the Company, or promptly return the severance benefits he received.

12. Governing Law. This Agreement and the Supplemental Release shall be
interpreted and construed by the laws of the State of North Carolina, without
regard to conflict of laws provisions.

13. Amendment and Waiver. This Agreement and the Supplemental Release shall be
binding upon the Parties and may not be modified in any manner, except by an
instrument in writing of concurrent or subsequent date signed by duly authorized
representatives of the Parties hereto. This Agreement and the Supplemental
Release are binding upon and shall inure to the benefit of the Parties and their
respective agents, assigns, heirs, executors, successors and administrators. No
delay or omission by the Company in exercising any right under this Agreement or
the Supplemental Release shall operate as a waiver of that or any other right. A
waiver or consent given by the Company on any one occasion shall be effective
only in that instance and shall not be construed as a bar to or waiver of any
right on any other occasion.

14. Cooperation. The Executive agrees to cooperate fully with the Company in the
defense, prosecution and/or investigation of any claims or actions now in
existence or that may be brought in the future against or on behalf of the
Company. The Executive’s full cooperation in connection with such claims or
actions shall include, but not be limited to, being available to meet with the
Company counsel to prepare for discovery and any administrative hearing,
mediation, arbitration, trial or other proceeding, and to act as a witness when
requested by the Company at reasonable times and locations designated by the
Company. The Company will pay or reimburse any reasonable expenses (other than
attorneys’ fees) incurred and substantiated in connection with such cooperation,
subject to a requirement that the Executive submit adequate substantiation for
such expenses within 60 days after they are incurred; the Company will pay or
reimburse within 30 days after receipt of such substantiation. The Company and
the Executive agree that the Company will compensate the Executive for any time
spent on such cooperation after the Termination Date, at an hourly rate to be
mutually agreed by the parties.

15. Tax Provision. In connection with the consideration provided to the
Executive pursuant to this Agreement and the Supplemental Release, the Company
will withhold and remit to the tax authorities the amounts required under
applicable law, and the Executive shall be responsible for all applicable taxes
with respect to such consideration under applicable law. The Executive
acknowledges that he is not relying upon the advice or representation of the
Company with respect to the tax treatment of any of the consideration set forth
above.

 

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16. Captions. The captions of the sections of this Agreement are for convenience
of reference only and in no way define, limit or affect the scope or substance
of any section of this Agreement.

17. Entire Agreement. This Agreement and the Supplemental Release contain and
constitute the complete agreement between the Parties hereto with respect to the
settlement of claims against the Company and cancels all previous oral and
written negotiations, agreements and commitments in connection therewith,
including, but not limited to, the Employment Agreement; provided, however, that
Sections 7, 11 and 13 will survive the termination of the Employment Agreement.

IN WITNESS HEREOF, the Parties have executed this Agreement as of the dates
indicated below.

 

Dated:  

12/22/10

   

/s/ Andrew L. Graham

      Andrew L. Graham       TRIMERIS, INC. Dated:  

12/22/10

   

/s/ Martin Mattingly

      By:   Martin Mattingly       Title:   Chief Executive Officer

 

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EXHIBIT A

SUPPLEMENTAL RELEASE OF CLAIMS

In further consideration of the severance benefits described in the Settlement
Agreement and Release of Claims to which this Supplemental Release of Claims is
attached, which the Executive acknowledges he would not otherwise be entitled to
receive, the Executive on behalf of himself and his successors, assigns, and
agents hereby fully, forever, irrevocably and unconditionally releases, remises
and forever discharges the Company and its predecessors, successors, affiliates,
subsidiaries, parent companies, and assigns, and all of its and their respective
past and present agents, directors, officers, partners, members, donors, plan
administrators, fiduciaries, insurers, attorneys and employees (collectively
“Releasees”) from any and all claims, charges, complaints, demands, actions,
causes of action, suits, rights, debts, sums of money, costs, accounts,
reckonings, covenants, contracts, agreements, promises, doings, omissions,
damages, executions, obligations, liabilities and expenses (including attorneys’
fees and costs), whether known or unknown, of every kind and nature that the
Executive has ever had or now has against any or all of the Releasees,
including, but not limited to, any and all claims arising out of or relating to
the Executive’s employment with and/or separation from the Company, including,
but not limited to, all claims under Title VII of the Civil Rights Act of 1964,
42 U.S.C. § 2000e et seq., the Genetic Information and Nondiscrimination Act of
2008, 42 U.S.C. § 2000ff et seq., the Americans with Disabilities Act of 1990,
42 U.S.C. § 12101 et seq., the Family and Medical Leave Act, 29 U.S.C. § 2601 et
seq., the Fair Credit Reporting Act, 15 U.S.C. § 1681 et seq., the
Rehabilitation Act of 1973, 29 U.S.C. § 701 et seq., Executive Order 11246,
Executive Order 11141, the Employee Retirement Income Security Act of 1974
(“ERISA”), 19 U.S.C. § 1001 et seq., the North Carolina Equal Employment
Practices Act, N.C. Gen. Stat. § 143-422.1 et seq., the North Carolina Persons
with Disabilities Protection Act, N.C. Gen. Stat. § 168A-1 et seq., the North
Carolina Retaliatory Employment Discrimination Act, N.C. Gen. Stat. § 95-240 et
seq., the North Carolina Hazardous Chemicals Right to Know Act, N.C. Gen. Stat.
§ 95-173 et seq., and N.C. Gen. Stat. § 95-151 (North Carolina prohibition
against discrimination under the Occupational Safety and Health Act of North
Carolina), all as amended; and all common law claims including, but not limited
to, actions in tort, defamation, intentional infliction of emotional distress,
fraud, misrepresentation, wrongful discharge and breach of contract, including,
but not limited to, any claims arising from or related to the Employment
Agreement and any predecessor employment agreements entered into between the
Company and the Executive; and any claim or damage arising out of the
Executive’s employment with and/or separation from the Company (including a
claim for retaliation) under any common law theory or any federal, state or
local statute or ordinance not expressly referenced above; provided, however,
that nothing in this Agreement prevents the Executive from filing a charge with,
cooperating with, or participating in any proceeding before the EEOC or a state
fair employment practices agency (except that the Executive acknowledges that he
may not recover any monetary benefits in connection with any such claim, charge
or proceeding).

 

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The Company agrees that the Executive is not releasing any claims or rights that
he may have for indemnification under state or other law or the charter or
by-laws of the Company, or under any indemnification agreement with the Company
or under any insurance policy providing directors’ and officers’ coverage for
any lawsuit or claim relating to the period when he was an officer of the
Company; provided, however, that (i) the Company’s execution of this Release is
not a concession or acknowledgment that the Executive has any such rights to
indemnification, (ii) this Release does not create for the Executive any
additional rights to indemnification, and (iii) the Company retains any and all
defenses it may have to such indemnification or coverage.

The Executive acknowledges that he has been reimbursed by the Company for all
business expenses incurred in conjunction with the performance of his employment
and that no other reimbursements are owed to him. The Executive further
acknowledges that he has received payment in full for all services rendered in
conjunction with his employment by the Company and that no other compensation,
including wages, bonuses, severance and accrued unused vacation, is owed to him,
except as specified in Section 2 of the Settlement Agreement and Release of
Claims.

The Executive acknowledges that he has been given at least seven days to
consider this Supplemental Release and that the Company advised him to consult
with an attorney of his own choosing prior to signing this Supplemental Release.

 

 

I hereby provide this release of claims as of the current date and acknowledge
that the execution of this Supplemental Release is in further consideration of
the severance benefits set forth in Section 2 of the Settlement Agreement and
Release of Claims, to which I acknowledge I would not be entitled if I did not
sign this Supplemental Release.

 

 

   

 

Andrew L. Graham     Date

To be signed and returned no later than three business days following the
Termination Date; provided, however, that it may not be signed before close of
business on the Termination Date (as defined in the Settlement Agreement and
Release of Claims).

 

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