Exhibit 10.2

 

AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT

 

This Amended and Restated Executive Employment Agreement (the “Agreement”) is
made by and between Sucampo Pharmaceuticals, Inc., its parent, subsidiary,
predecessor and affiliated corporations (collectively “Sucampo”), and Peter
Greenleaf (“Executive”), and amends, restates and supersedes the Employment
Agreement between Sucampo and Executive dated March 3, 2014.

 

A.                Employment and Duties.

 

1.                  Sucampo shall employ Executive as Chief Executive Officer.
While employed by Sucampo, Executive shall devote Executive’s full-time work
efforts exclusively on behalf of Sucampo and shall not perform work of any
nature for compensation of any kind for any person or entity other than for
Sucampo, unless approved in writing by the Chair or lead independent director of
Sucampo’s Board of Directors.

 

2.                  This Agreement shall be in effect for the one-year period
following the first date on which both Executive and Sucampo have signed the
Agreement (the “Anniversary Date”). The Agreement will continue to renew on a
year-to-year basis unless either party ends the Executive’s employment pursuant
to Section H; or Sucampo delivers written notice to the Executive about
Sucampo’s intent to renew the Agreement with specifically articulated changes at
least 30 days before the Anniversary Date, and then terminates the Agreement
under Section N.

 

B.Compensation and Benefits.

 

1.                  Base Salary. Sucampo shall pay Executive an annual base
salary of Six Hundred Seventy One Thousand Five Hundred Forty Five US dollars
and Seventy Four Cents (US$671,545.74) in accordance with Sucampo’s regular
payroll cycle (the “Base Salary”). The Base Salary shall be reviewed on an
annual basis and may, in the sole discretion of the Board of Directors, be
increased, but not decreased (unless either mutually agreed by Executive and
Sucampo, or established as part of salary reductions that apply equally to
similarly situated officers as a percentage reduction in their salaries).

 

2.                  Bonus. Executive shall be entitled to participate in
Sucampo’s annual incentive plan, as defined and modified from time to time by
Sucampo. The target bonus for Executive shall be 60% of Executive’s Base Salary,
in the sole discretion of the Board of Directors. The annual bonus payable to
Executive for any fiscal year shall be paid to Executive in a lump sum on the
date set forth in Sucampo’s incentive plan in effect at the time of payment.
Sucampo reserves the unilateral right to modify the incentive plan and reserves
the unilateral discretion to determine the amount of Executive’s bonus, if any.
Executive agrees that such bonus is not “earned” until approved by the Board of
Directors.

 

3.                  Stock. At least annually for the Term of this Agreement,
Executive shall be eligible for consideration to receive restricted stock
grants, stock options or other awards

 

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(collectively, “Equity Incentive Awards”) in accordance with the 2016 Equity
Incentive Plan or such other equity incentive plan as may be designated in the
Stock Agreement (collectively referred to as the “Plan”). Any such Equity
Incentive Awards shall be made in the sole discretion of the Board of Directors.

 

4.                  Taxes. Executive acknowledges and agrees that Executive
shall be solely responsible for the satisfaction of any applicable taxes that
may arise pursuant to this Agreement (including taxes arising under Section 409A
of the Internal Revenue Code (“IRC”), which pertains to deferred compensation)
or 4999 (which pertains to golden parachute excise taxes), and that neither
Sucampo nor any of its employees, officers, directors, or agents shall have any
obligation whatsoever to pay such taxes or to otherwise indemnify or hold
Executive harmless from any or all of such taxes. For purposes of IRC Section
409A, the right to a series of installment payments under this Agreement shall
be treated as a right to a series of separate payments. All compensation due to
Executive shall be paid subject to withholding by Sucampo to ensure compliance
with all applicable laws and regulations.

 

5.                  Participation in Benefits. Executive shall be entitled to
participate in all Sucampo employee benefit plans or programs offered to other
Sucampo employees to the extent that Executive's position, tenure, salary, and
other qualifications make Executive eligible to participate in such plans.
Sucampo reserves the unilateral right to adopt, continue, discontinue, amend,
modify, reduce or expand each and every employee benefit plan, program or other
fringe benefit during any term of the Agreement. Participation by Executive in
any such plan, program or benefit shall be subject to all applicable rules and
regulations.

 

6.                  Expenses. Sucampo shall pay or reimburse Executive for all
reasonable and necessary out-of-pocket expenses incurred by Executive the
performance of his or her obligations under this Agreement. Sucampo shall
reimburse such expenses in accordance with Sucampo’s expense reimbursement
policies and procedures. Sucampo reserves the right to modify such policies and
procedures in its sole discretion. All reimbursements due under this Agreement
shall be separately requested and paid not later than one year after Executive
incurs the underlying expense.

 

7.                  Professional Organizations. During the Term, Sucampo shall
reimburse Executive for the annual dues payable for membership in professional
societies associated with the Executive’s job responsibilities or subject
matters related to Sucampo’s interests. Sucampo shall only reimburse for a new
membership if and after Sucampo has approved such membership.

 

C.Confidential Information.

 

1.                  Executive acknowledges that Sucampo operates in a
competitive environment and has a legitimate business interest in protecting
Sucampo’s Confidential Information and Protected Property. “Confidential
Information” includes any of the following information pertaining to Sucampo or
its affiliated entities:

 

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a.                   Any and all information, whether or not meeting the legal
definition of a trade secret, and whether in written, oral, electronic or other
form, containing and/or concerning: (i) business plans, strategic plans,
forecasts, budgets, sales, financial projections and costs; (ii) personnel and
payroll records and employee lists, including any information related to an
employee’s health; (iii) candidates, consultants, and contractors, including
lists, resumes, preferences, transaction histories and rates; (iv) customers and
prospective customers, including their identity, the identities of their
employees, contractors and consultants, special needs, job orders, preferences,
transaction histories, contacts, characteristics, agreements and current or
proposed pricing; (v) marketing activities, plans, promotions, operations and
research and development; (vi) business operations, internal organizational
structure and financial affairs; (vii) pricing structure and/or current or
proposed manufacturing costs; (viii) proposed services, technologies and
products; (ix) contracts with customers, suppliers, joint ventures, licensors,
licensees, or distributors; (x) customer history; (xi) compensation structure
and strategy compared to the market; (xii) current or proposed product tests;
(xiii) technical or scientific information or processes, including chemical
compounds, computer programs, code, algorithms, Inventions (as defined below),
formulae, test data, know how, functional and technical specifications, designs,
drawings; (xiv) passwords; and

 

b.                  Any information (including any compilation, device, method,
technique or process) that (i) derives independent economic value, actual or
potential, from not being generally known to, and not being readily
ascertainable by proper means by, other persons who can obtain economic value
from its disclosure or use, and (ii) is the subject of efforts that are
reasonable under the circumstances to maintain its secrecy (hereafter “Trade
Secret”). Such information constitutes a Trade Secret even if a person has
acquired the information without express notice that it is a Trade Secret if,
under all the circumstances, such person knows or has reason to know that the
party who owns the information or has disclosed it intends or expects the
secrecy of the type of information comprising the Trade Secret to be maintained.

 

c.                   The term “Confidential Information” excludes any
information that (i) is, was, or enters in the public domain without violation
of this Agreement and through no fault of the Executive, (ii) was in Executive’s
possession free of any obligation of confidence at the time it was disclosed to
the Executive, or (iii) was rightfully communicated to the Executive by a third
party free of any obligation of confidentiality subsequent to the time it was
disclosed by Sucampo to the Executive.

 

2.                  During and after the Term of this Agreement, Executive shall
not, directly or indirectly, reproduce, commercialize, use, disclose, or
authorize use or disclosure of, any Confidential Information, unless such use or
disclosure is (a) consistent with Sucampo’s obligations or business purposes and
for the sole purpose of carrying out Executive’s duties to Sucampo, or (b)
specifically authorized by Sucampo in writing prior to such use or disclosure.
Executive understands and agrees that this restriction shall continue to apply
after this Agreement terminates, regardless of the reason for such termination.
Executive agrees to comply with all policies and procedures of Sucampo for
protecting Confidential Information.

 

3.                  Executive agrees that Sucampo has the right to refuse
publication of any papers prepared by Executive as a result of Executive’s
employment, consultation, work or services,

 

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with, for, on behalf of or in conjunction with Sucampo. Executive agrees to
submit any proposed publications referring to Executive’s employment,
consultation, work, services and activities with, for, on behalf of or in
conjunction with Sucampo, or referring to any information developed therefrom,
to Sucampo for review, prior to publication, to ensure that Sucampo’s position
with respect to Confidential Information is not adversely affected by
publication disclosures.

 

4.                  If Executive is required to disclose Confidential
Information due to the issuance of a court order or other government process,
Executive shall (a) promptly, but in no event more than 72 hours after learning
of such court order or other government process, notify the Executive Vice
President, Global Human Resources, IT and Strategy; (b) at Sucampo’s expense,
take all reasonable necessary steps requested by Sucampo to defend against the
enforcement of such court order or other government process, and permit Sucampo
to intervene and participate with counsel of its choice in any proceeding
relating to the enforcement thereof; and (c) if such compelled disclosure is
required, Executive shall disclose only that portion of the Confidential
Information that is necessary to meet the minimum legal requirement imposed on
Executive

 

5.                  Executive agrees that, upon termination of this Agreement or
if requested by Sucampo, Executive shall immediately return to Sucampo any and
all Sucampo Property (as defined below) and documents and other media containing
Confidential Information (and all hard/electric copies thereof) in Executive’s
possession, custody or control.

 

a.                   “Sucampo Property” shall mean any and all documents,
instruments, records and databases, recorded or stored on any medium whatsoever,
relating or pertaining, directly or indirectly, to the business of Sucampo,
including without limitation any and all documents (and copies) containing or
relating to Confidential Information. Executive acknowledges that Sucampo
Property is solely the property of Sucampo regardless of whether it was created,
stored or used on property of the Executive or any other person or entity.

 

b.                  Executive agrees that, while employed by Sucampo, Executive
shall not directly or indirectly, use, or allow the use of, Sucampo property of
any kind (including property leased to Sucampo), for any purpose other than
Sucampo activities, except with the authorization of a duly authorized
representative of Sucampo.

 

c.                   Executive agrees not to remove any Sucampo Property from
Sucampo’s business premises or deliver any Sucampo Property to any person or
entity outside of Sucampo, except as required in connection with Executive’s
duties of employment.

 

d.                  If Sucampo Property in electronic form that contains or
relates to Confidential Information is stored on a computer or device that is
not Sucampo Property, then at the termination of this Agreement, Executive
agrees to promptly deliver a copy of the stored Sucampo Property to Sucampo,
permanently delete the Sucampo Property from the computer or device, and confirm
these actions to Sucampo in writing.

 

6.                  Executive understands that Executive is signing this
Agreement as a condition of Executive’s employment, or continued employment,
with Sucampo. Executive further acknowledges and agrees that Executive’s
employment or continued employment by Sucampo, Executive’s access to Sucampo’s
Confidential Information, and other goods and valuable

 

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consideration associated with employment by Sucampo, provide good and sufficient
consideration for Executive’s obligations under this Agreement.

 

D.Protected Property.

 

1.                  “Protected Property” includes any Invention (as defined
below), discovery, improvement, idea or expression of idea, process,
development, design, know-how, data, and formula, whether patentable or
un-patentable, or protectable by copyright or other intellectual property law,
that Executive makes or conceives, alone or with others, during or outside of
working matters, during Executive’s employment with Sucampo, that relates in any
manner to the actual or demonstrably anticipated business, research or
development of Sucampo, or results from or is suggested by any task assigned to
Executive or any work performed by Executive on behalf of Sucampo. “Invention”
means any apparatus, biological processes, cell line, chemical compound,
creation, data, development, design, discovery, formula, idea, improvement,
innovation, know-how, laboratory notebook, manuscript, process or technique,
whether or not patentable or protectable by copyright, or other intellectual
property in any form.

 

2.                  Executive agrees to communicate to Sucampo in writing as
promptly and fully as practicable all Protected Property conceived or reduced to
practice by Executive at any time during the Executive’s employment by Sucampo.
Executive agrees to keep and maintain adequate written records of Protected
Property at all times and stages, in the form of notes, sketches, drawings,
memoranda and reports. Those records shall be the property of and be available
to Sucampo at all times.

 

3.                  Executive hereby assigns to Sucampo and/or its nominees, all
of Executive’s right, title, and interest in such Protected Property, and all of
the Executive’s right, title, and interest in any patents, copyrights, patent
applications, software, trademarks, or copyright applications based thereon.
Executive agrees that all Protected Property subject to copyright protection
constitutes "work made for hire" under United States copyright laws (17 U.S.C.
§101) and is owned exclusively Sucampo. To the extent that title to any
Protected Property subject to copyright protection does not constitute a "work
for hire," and to the extent title to any other Protected Property does not, by
operation of law or otherwise, vest in Sucampo, all right, title, and interest
therein, including, without limitation, all copyrights, patents and trade
secrets, and all copyrightable or patentable subject matter, are hereby
irrevocably assigned to Sucampo.

 

4.                  Executive shall, at the expense of and on behalf of Sucampo,
do everything reasonably necessary for Sucampo to obtain, preserve, and protect
Sucampo's right, title and interest in and to such Protected Property, including
preparing and signing all documents Sucampo may deem necessary to obtain and
maintain patents, copyrights, trade secrets, trademarks, service marks and other
rights within the United States or anywhere in the world. This obligation binds
Executive or Executive’s legal representative and continues despite the end of
Executive’s employment with Sucampo, subject to reasonable compensation by
Sucampo for Executive’s time and expenses. Should Sucampo be unable, after
reasonable effort, to obtain Executive’s signature on any document necessary to
apply for or prosecute any of the above rights for any reason, Executive hereby
irrevocably designates and appoints Sucampo or its officers and agents as
Executive’s agent coupled with a power of attorney to act on Executive’s behalf
to do everything necessary to accomplish the above.

 

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5.                  The provisions of this Section D do not apply to any
invention if (a) Executive developed it entirely on Executive’s own time; (b)
Executive did not use or rely on any of Sucampo’s Confidential Information,
equipment, supplies, or facilities; (c) the invention is unrelated to Sucampo’s
business; and (d) the invention did not result from any work Executive performed
for Sucampo. If, when hired or during Executive’s employment, Executive is
working on any invention that is excluded under this Section D.5. Executive
agrees to put Sucampo on written notice at the time of hire or as soon as the
Executive starts working on the invention during Executive’s employment. To
further comply with this notice requirement, Executive has provided Exhibit 1 to
this Agreement, which includes a complete list and description of all
Inventions, intellectual property and equipment located at Sucampo that is owned
directly or indirectly by Executive and which shall not be transferred to
Sucampo pursuant to this Agreement. Except for those items listed on Exhibit 1,
Executive agrees that he or she shall not assert any rights under any
intellectual property as having been made or acquired by Executive prior to
being employed by Sucampo. If Sucampo and Executive disagree about whether an
invention is appropriately listed on Exhibit 1, Executive and Sucampo agree to
submit the matter to arbitration per the terms of Section I below.

 

E.Non-Competition And Non-Solicitation.

 

1.                  Executive agrees that, as a result of Executive’s position
with Sucampo and/or the unique skills Executive brings to Sucampo, Sucampo has
entrusted Executive with information and customer relationships that are
valuable to Sucampo, and that Sucampo has a legitimate interest in protecting.
Accordingly, Executive agrees that, during the term of this Agreement and for a
period of twelve consecutive months following the end of that employment, absent
the prior written, signed consent of the President of Sucampo, Executive shall
not directly or indirectly render services, advice or assistance similar to the
services Executive provided while employed by Sucampo, or involving the
Executive’s use of knowledge Executive gained while employed at Sucampo, to any
Conflicting Organization, in connection with any Conflicting Product.
“Conflicting Organization” means any person, entity or organization engaged in
research on, or development, production, or marketing of, a Conflicting Product.
“Conflicting Product” means any product, method, process, system or service
provided for commercial use or sale of any person or organization other than
Sucampo, that is the same, similar to, or interchangeable with a product,
method, process, system, or service provided for commercial use or sale or under
development for commercial use or sale by Sucampo when this Agreement
terminates, or about which Executive developed Protected Property while employed
by Sucampo. The foregoing restrictions shall not prevent Executive from working
for or performing services on behalf of any business or other entity that offers
Conflicting Products if such business or entity is also engaged in other lines
of business and if Executive certifies to Sucampo before accepting such
employment that Executive's employment or services shall be restricted to such
other lines of business, and Executive shall not directly or indirectly be
providing support, advice, instruction, direction or other guidance to lines of
business providing a Conflicting Product.

 

2.                  Executive agrees that, solely as a result of Executive’s
position and employment with Sucampo, Executive shall or has come to know
Confidential Information regarding some of Sucampo’s employees, independent
contractors and/or consultants. Accordingly, both during the Term of this
Agreement and for a period of twelve consecutive months following the end of
that employment, Executive agrees to not directly or indirectly—either on
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or on behalf of any person, company, corporation, or other entity— induce,
solicit, endeavor to entice or attempt to induce any Sucampo Employees (as
defined below) to: (a) leave employment with Sucampo; (b) supply any Sucampo
Confidential Information to any third party or entity; or (c) alter, sever,
discontinue, or in any other way interfere with their relationship with Sucampo.
“Sucampo Employees” are Sucampo employees, independent contractors and
consultants who Executive has come to know as a result of Executive’s employment
with Sucampo, and with whom Executive had business communications at any time
during the last twenty-four months of the Term of this Agreement.

 

3.                  Executive agrees that, solely as a result of Executive’s
position and employment with Sucampo, Executive shall or has come to know some
of Sucampo’s clients and has access to Confidential Information related to them.
Accordingly, both during the Term of this Agreement and for a period of twelve
consecutive months following the end of such employment, Executive agrees to
not, directly or indirectly, induce, solicit, endeavor to entice or attempt to
induce any Sucampo Client (as defined below) to cease doing business with
Sucampo, or in any way interfere with the relationship between any such Sucampo
Client and Sucampo. “Sucampo Clients” are individuals or entities of any nature,
with whom/which Executive had business-related involvement on behalf of Sucampo
at any time during the last twenty-four months of the Term of this Agreement.
“Business-related involvement” includes Executive’s direct communication with
the Sucampo client, and any direct or indirect involvement in any aspect of
developing the initial relationship and any direct or indirect involvement on
behalf of Sucampo in any aspect of Sucampo’s relationship with the Sucampo
Client.

 

4.                  Executive acknowledges and agrees that Sucampo operates
globally, and the products and services of Sucampo are or are intended to be
marketed to customers on a global basis. Executive further acknowledges and
agrees to the reasonableness of the provisions in this Section E and the
adequacy of the consideration supporting these provisions. Executive also
acknowledges and agrees that the provisions of this Section E will not preclude
Executive from becoming gainfully employed following termination of employment
with Sucampo.

 

F.Breach of Obligations of Confidentiality, Non-Competition and
Non-Solicitation.

 

1.                  Executive acknowledges that any threatened or actual breach
of Section C or E of this Agreement may cause irreparable harm to Sucampo, for
which money damages would be inadequate to compensate Sucampo. Consequently, in
the event of a breach or threatened breach of Section C or E of this Agreement,
Executive agrees that Sucampo shall be entitled to expedited arbitration under
Section I of this Agreement to obtain injunctive relief to enforce this
Agreement, without necessity of posting a bond. In such an expedited arbitration
proceeding, the arbitrator must issue a determination within 30 days after
Sucampo initiates the arbitration proceeding. The twelve-month period described
in Section E shall be tolled during any period when Executive is engaged in
activity that violates the terms of Section E. In such an arbitration
proceeding, the arbitrator shall have the authority to award damages as
appropriate. However, given the difficulty of assessing damages for breaches of
this Agreement, the Parties agree that, if the arbitrator finds Executive
violated this Agreement, the arbitrator must issue a damage award of, at
minimum, $25,000. Each disclosure or transmission of Protected Property shall
constitute a separate violation and the minimum damage amount will apply to each
violation.

 

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Further, if Executive breaches or fails to honor any provision in Section C or E
of this Agreement, and Sucampo is successful in whole or in part in any legal or
equitable action to defend its right under or to enforce any terms of Section C
or E, Executive agrees to reimburse Sucampo for Sucampo’s costs, expenses, and
reasonable attorneys’ fees associated with such action. In that event, the
arbitrator will be obligated to award Sucampo all its attorneys’ fees and costs
as part of the arbitrator’s determination. Executive waives any defense as to
the validity of any liquidated damages stated in this Agreement on the grounds
that such liquidated damages are void as penalties or are not reasonably related
to actual damages.

 

2.                  Notwithstanding the language in Section F.1. above, under
the federal Defend Trade Secrets Act of 2016, Executive shall not be held
criminally or civilly liable under any federal or state trade secret law for the
disclosure of a trade secret that: (a) is made (i) in confidence to a federal,
state, or local government official, either directly or indirectly, or to an
attorney; and (ii) solely for the purpose of reporting or investigating a
suspected violation of law; or (b) is made to Executive’s attorney in relation
to a lawsuit for retaliation against Executive for reporting a suspected
violation of law; or (c) is made in a complaint or other document filed in a
lawsuit or other proceeding, if such filing is made under seal.

 

G.Sucampo Access.

 

Executive agrees and consents that, during the Term of this Agreement and
thereafter, Sucampo may review, audit, intercept, review and disclose all
messages created, received or sent over the voice mail, electronic mail and
Internet access systems provided by Sucampo, with or without notice to
Executive. Executive further consents and agrees that Sucampo may, at any time,
access and review the contents of all telephones and related systems, computers,
computer disks, other data storage equipment and devices, files, desks, drawers,
closets, cabinets and work stations which are either on Sucampo’s premises or
which are owned or provided by Sucampo. Executive acknowledges that Executive
should have no expectation of privacy in any of the electronic communications
systems or work areas described in this paragraph.

 

H.Termination.

 

1.                  Termination by Sucampo for Cause. Sucampo may terminate this
Agreement and Executive’s employment for Cause (as defined below) by written
notice with immediate effect.

 

“Cause” shall mean any of the following:

 

(i)   the gross neglect, willful failure, or refusal of Executive to perform
Executive's duties and/or responsibilities (other than as a result of
Executive's death or Disability); or

 

(ii)   perpetration of an intentional and knowing fraud against or affecting the
Company or any customer, supplier, client, agent or employee thereof; or

 

(iii)      any willful or intentional act that could reasonably be expected to
injure the reputation, financial condition, business or business relationships
of the Company or Executive's reputation or business relationships, including
but not limited to any act that could subject Sucampo to legal liability (e.g.
violation of Sucampo’s policy prohibiting sexual harassment); or

 

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(iv)   conviction (including conviction on a nolo contendere plea) of a felony
or any crime involving fraud, dishonesty or moral turpitude; or

 

(v) the material breach by Executive of this Agreement (including, without
limitation, Section C or E); or

 

(vi)     Executive’s supervisor demonstrates he/she had legitimate reasons to
conclude Executive failed or refused to perform Executive’s job duties and/or
responsibilities at an acceptable level, within 30 days after Executive’s
supervisor provided Executive with written notice detailing the specific
(unacceptable) performance areas and/or behavior that Executive must improve to
remain employed; or

 

(vii)     Executive refuses to execute a modified Agreement offered by Sucampo
on the Anniversary Date of this Agreement that is in compliance with Section
A.2; as long as the modified Agreement does not make any unilateral changes to
Section B.1 (protections against deductions in the Executive’s Base Salary),
Section H (Termination for Cause/Termination Without Cause/Resignation for Good
Reason/Change of Control/Separation Benefits) or substantially change Section I
(agreement to arbitrate).

 

2. Termination Other Than For Cause.

 

a.                   Termination Without Cause. Either party may terminate this
Agreement and Executive's employment hereunder at any time upon 30 days’ prior
written notice to the other party. Executive’s employment and this Agreement
shall terminate at the end of the 30-day notice period. Sucampo may elect to
provide Executive with 30 days' salary in lieu of Executive's continued active
employment during the notice period.

 

b.                    Resignation for Good Reason.

 

i.                    To resign for Good Reason, within 21 days of any event or
condition that gives rise to Executive’s belief that he/she has Good Reason to
resign, Executive must notify Sucampo in writing that Executive intends to
resign for “Good Reason under Section H.2.b” and state the reasons for
Executive’s belief he/she has reason to do so. Following receipt of such notice,
Sucampo will have 30 days (the “Cure Period”) to cure the issues identified by
Executive. If, by the expiration of the Cure Period, Sucampo has not cured the
issues identified by Executive, and those issues meet the standard for Good
Reason defined below, Executive may resign for Good Reason. If Executive does
not resign within 14 days following the Cure Period, Executive waives any future
right to resign for Good Reason based on the same reasons set forth in his/her
21 day letter.

 

ii.                  As used herein, “Good Reason” is the same standard as
“constructive discharge” in Maryland federal employment law cases. More
specifically, to resign for Good Reason, Executive must establish that Sucampo
unilaterally made materially significant change(s) to, or diminutions of,
Executive’s work environment, commute to work, terms, conditions; job duties,
responsibilities and/or overall status of his/her position, that rendered
Executive’s continued employment so unbearable that a reasonable person would
resign.

 

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iii.                Executive shall have the right to resign for Good Reason if
Sucampo requires Executive to accept any unilateral change(s) to Section A.2,
Section B.1 (Base Salary), Section H (standards for
termination/resignation/death and disability/separation benefits), Section N
(limits to unilateral changes), or any materially significant changes to Section
I (Arbitration) of this Agreement at any time—including before, on or after the
Anniversary Date. If Executive resigns under this subsection H.2.b.iii, Sucampo
shall pay Executive the Separation Benefits enumerated in Section H.2.d without
any obligation to meet the constructive discharge standard for Good Reason set
forth above in Section H.2.b.ii. In addition, if Executive resigns because
Sucampo or its successor makes unilateral changes to this Agreement to prepare
for—or within 12 months following—a Change in Control, that qualify as Good
Reason under this Section H.2.b.iii, Sucampo and/or its successor shall pay
Executive the “Change in Control Benefits” enumerated below in Section
H.3.b—instead of the Separation Benefits in Section H.2.d.

 

iv.                If Executive provides notice that he/she is resigning for
Good Reason, Sucampo reserves the right to accept Executive’s resignation
immediately, end the Agreement, release Executive from employment immediately or
at any time during the Cure Period, and pay Executive’s Base Salary during the
remaining Cure Period, up to a maximum of 30 days. By electing to do so, Sucampo
does not concede that Executive has met the condition(s) to resign for Good
Reason defined above.

 

c.                   Death or Disability. If Executive dies, this Agreement and
Executive's employment shall terminate automatically. If Executive has or
develops a disability that affects Executive’s ability to work, Sucampo shall
explore options with Executive to determine whether Executive is able to perform
the essential functions of the job with or without reasonable accommodation. In
the event of any dispute as to whether Employee is disabled for purposes of this
Section H.2.c., such dispute shall be resolved by an independent physician
competent to assess the condition at issue selected by Sucampo and performing
such assessment at Sucampo’s expense. Upon termination of this Agreement due to
Executive’s death or disability, Sucampo shall provide Executive (or Executive’s
estate, as applicable) with all of Executive’s compensation and benefits that
had fully accrued or fully vested as of the date this Agreement terminated. No
other compensation or benefits of any nature shall accrue, vest or continue
after the effective date the Agreement is terminated, except as provided under
paragraph d. immediately below.

 

d.                  Separation Benefits. If Sucampo terminates Executive’s
employment without meeting the conditions for “Termination for Cause” in Section
H.1; if Executive resigns for Good Reason under the conditions set forth in
Section H.2.b, or due to the Executive’s “Death or Disability” under Section
H.2.c; and Executive (or the executor of Executive’s estate upon death or
incapacity) signs and returns to Sucampo without revocation a release prepared
by Sucampo of all legally waivable claims related to or arising from Executive’s
employment with Sucampo and all other terms determined exclusively by Sucampo,
then (i) Sucampo shall pay Executive (or the estate): (A) the amount of any
COBRA continuation premium payments made by Executive during the 12-month period
following the date of termination, or the period ending when Executive becomes
eligible for comparable group medical benefits coverage from another source
(whichever comes first); (B) a lump sum severance payment equal to the sum of
(1) twelve (12) months of Executive's then current annual Base Salary and (2)
the current target

 

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bonus percentage of the current annual Base Salary, to be made not later than 60
days following Executive’s date of termination; and (ii) Executive’s Equity
Incentive Awards shall vest as set forth in Section H.5 (collectively, the
“Separation Benefits”).

 

3. Termination in Connection with Change In Control.

 

a.                   This Agreement terminates if it is not assumed by the
successor corporation (or affiliate thereto) upon a Change in Control (as
defined below).

 

“Change in Control” means: (i) the acquisition by any person of beneficial
ownership of 50% or more of the outstanding shares of the voting securities of
Sucampo ; (ii) Sucampo is the non-surviving party in a merger; (iii) Sucampo
sells all or substantially all of its assets, provided, that no “Change in
Control” shall be deemed to have occurred merely as the result of a refinancing
by Sucampo or as a result of Sucampo’s insolvency or the appointment of a
conservator; or (iv) the Board of Directors of Sucampo, in its sole and absolute
discretion, determines that there has been a sufficient change in the share
ownership or ownership of the voting power of Sucampo’s voting securities to
constitute a change of effective ownership or control of Sucampo.

 

b.                  If, in advance of the closing or within 12 months following
the occurrence of a Change in Control of Sucampo, this Agreement is terminated
other than for Cause, and Executive signs and returns to Sucampo without
revocation a release prepared by Sucampo of all legally waivable claims related
to or arising from Executive’s employment with Sucampo and all other terms
determined exclusively by Sucampo, then (i) Sucampo shall pay Executive: (A) the
amount of any COBRA continuation premium payments made by Executive during the
24- month period following the Date of Termination, or the period ending when
Executive becomes eligible for comparable group medical benefits coverage from
another source (whichever comes first) and (B) a lump sum payment equal to the
sum of (1) 24 months of Executive’s then-current annual Base Salary and (2) 200%
of the current target bonus percentage of the Executive’s current annual Base
Salary, to be made not later than 60 days following Executive’s date of
termination; and (ii) Executive’s Equity Incentive Awards shall vest as set
forth in Section H.5 (collectively, the “Change in Control Benefits”).

 

c.                   If within 12 months following a Change in Control, there is
a material diminution of Executive’s role in the company, material diminution of
status, or diminution of reporting structure, Executive shall have the right to
resign and receive the Change in Control Benefits enumerated in Section H.3.b.
without being required to satisfy the standard for Good Reason defined in
Section H.2.b.ii.

 

4. Timing Of Payments.

 

a.                   Sucampo shall, only to the extent necessary, modify the
timing of delivery of the Separation Benefits or the Change in Control Benefits
to Executive if Sucampo reasonably determines that the timing would subject such
Benefit to any additional tax or interest assessed under IRC Section 409A. In
such event, the payments shall be made as soon as practicable without causing
the Benefit to trigger such additional tax or interest under Section 409A of the
IRC. If any amount of the Benefit becomes constitutes “nonqualified deferred
compensation” within the meaning of Section 409A, payment of such amount shall
not commence until

 

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Executive incurs a “separation from service” within the meaning of Treasury
Regulation Section 1.409A-1(h). If, at the time of Executive’s separation from
service, Executive is a “specified employee” (under IRC Section 409A), any
benefit as to which Section 409A penalties could be assessed that becomes
payable to Executive on account of Executive’s “separation from service”
(including any amounts payable pursuant to the preceding sentence) shall be
paid, without interest thereon, on the date six months and one day after such
separation from service.

 

b.                  Prior to paying any Change in Control Benefit, Sucampo shall
cause its independent auditors promptly to review, at Sucampo's sole expense,
the applicability to those payments of Sections 280G and 4999 of the IRC. If the
auditors determine that any payment of the Change in Control Benefit would be
subject to the excise tax imposed by Section 4999 of the IRC or any interest or
penalties with respect to such excise tax, then such payment owed to Executive
shall be reduced by an amount calculated to provide to Executive the maximum
Change in Control Benefits which will not trigger application of Sections 280G
and 4999 of the IRC, with any such reduction being made last with respect to
benefits that are not exempt from IRC §409A.

 

5. Effect Of Termination On Equity Incentive Awards.

 

a.                   If this Agreement is terminated other than by Sucampo for
Cause, any unvested Equity Incentive Awards that have a duration vesting
condition as defined in the Stock Agreement shall immediately vest to the extent
such unvested Equity Incentive Awards would have vested in the 12 months from
the date of termination; or

 

b.                   If Sucampo is acquired or is the non-surviving party in a
merger, or Sucampo sells all of its assets, and in advance of the closing of
such transaction or within 12 months thereafter, this Agreement is terminated
other than for Cause, any unvested Equity Incentive Awards that have a duration
vesting condition as defined in the Stock Agreement shall immediately vest and
any unvested Equity Incentive Awards with a performance condition shall
immediately vest and may be exercised only to the extent the performance targets
have been achieved or would be achieved by such acquisition, merger or sale in
accordance with the terms of the Plan and the Stock Agreement.

 

c.                   If any provision of this Agreement conflicts with a
provision of the Stock Agreement and/or the Plan, the provision more favorable
to the Executive shall govern.

 

6. No Further Compensation. Executive shall receive all compensation and
benefits provided to Executive by Sucampo that fully accrued and fully vested
before the date of termination of this Agreement. No other compensation or
benefits of any nature provided by Sucampo shall continue, accrue or vest after
the date of termination, except as provided under the terms of any Sucampo
benefits plan in which Executive is enrolled as of the date of termination.

 

I.Arbitration.

 

1.                  Executive and Sucampo agree to resolve by arbitration any
and all disputes arising from or relating to Executive’s employment with
Sucampo, Executive’s application for

 

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such employment, the termination of this Agreement, any alleged breach of this
Agreement, or post-employment issues with Sucampo (collectively, “Covered
Disputes”), including:

 

a.                   claims relating to any claim of employment discrimination
on the basis of any legally protected trait, claims of retaliation for engaging
in any legally protected activity, claims under the Maryland Wage Payment and
Collection Law, or claims under any other federal, state or local law;

 

b.                   claims under the Family and Medical Leave Act of 1993, the
Fair Labor Standards Act of 1938, the Occupational Safety and Health Act of
1970, the Uniformed Services Employment and Reemployment Rights Act of 1994, or
the Worker Adjustment and Retraining Notification Act;

 

c.                   claims for breach of an express or implied contract,
quasi-contractual claims (e.g. unjust enrichment, quantum meruit, promissory
estoppel), or tort claims;

 

d.                   claims for benefits under the Executive Retirement Income
Security Act, except claims under an employee pension or benefit plan which
specifies that its claims procedure shall culminate in an arbitration procedure
different from this one, or is underwritten by a commercial insurer which
decides such claims.

 

2.                  Covered Disputes do not include: (a) claims for workers'
compensation benefits;(b) claims for unemployment compensation benefits; (c)
claims based upon Sucampo's current (successor or future) stock option plans,
employee pension and/or welfare benefit plans if those plans contain some form
of a grievance, arbitration, or other procedure for the resolution of disputes
under the plan; and (d) claims by law which are not subject to mandatory binding
pre- dispute arbitration pursuant to the Federal Arbitration Act, such as claims
under the Dodd-Frank Act.

 

3.                  Executive agrees that, if Sucampo terminates the Agreement
for Cause and an arbitrator later determines that Sucampo did not have Cause to
terminate the Agreement, then the remedy awarded to Executive shall be limited
to such compensation and benefits as Executive would have received in the event
of Executive's termination other than for Cause at the same time as the original
termination.

 

4.                  Executive affirms that Executive has been provided with a
copy of Sucampo’s Arbitration Procedures, and has had an opportunity to ask
questions regarding the procedures, to seek counsel, and has read, understands
and accepts them. By signing below, the Executive acknowledges and agrees that
Sucampo has the unilateral right to amend its arbitration procedures from time
to time as long as the underlying procedures provide similar access to the
arbitration process

 

J.                  Executive’s Representations . Executive represents to
Sucampo that Executive has no obligations to any other person or entity that
conflict with the Executive’s obligations under this Agreement. Executive
further represents that, to the extent Executive has disclosed information to
Sucampo, created any original materials or used any proprietary information in
consulting, working or rendering services with, for or to Sucampo, Executive has
the right to do so, and such actions shall not violate any privacy, proprietary
or other rights of others.

 

 

 

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K.Choice of Law.

 

This Agreement is governed by the laws of the United States and the State of
Maryland, without regard to its choice of law provisions.

 

L.Severability.

 

If any term of this Agreement is declared unenforceable, the decision-maker of
competent jurisdiction shall interpret or modify this Agreement, to the extent
necessary, for it to be enforceable. If any term of this Agreement is declared
unenforceable and cannot be modified to be enforceable, such term or provision
shall immediately become null and void, leaving the remainder of this Agreement
in full force and effect.

 

M.No Oral Agreements.

 

By signing below, Executive confirms that Executive understands Sucampo does not
enter into any oral agreements with any personnel.

 

N.Entire Agreement; Amendment.

 

1.                  This Agreement sets forth the entire agreement between the
Parties concerning the topics addressed in this Agreement. This Agreement fully
supersedes the Employment Agreement between the parties dated March 3, 2014 and
any other prior oral or written inducements, agreements or understandings
between the Parties regarding such topics. This Agreement shall be binding upon
and inure to the benefit of Sucampo, its successors and assigns, without the
need for further agreement or consent by Executive. If Sucampo is acquired
during the Term, or is the non-surviving party in a merger, or sells all or
substantially all of its assets, this Agreement shall not automatically be
terminated, and Sucampo agrees to use its best efforts to ensure that the
transferee or surviving company shall assume and be bound by the provisions of
this Agreement. The failure of either party to enforce any of the provisions in
this Agreement shall not be construed to be a waiver of the right of that party
to enforce any such provision.

 

2.                  During the term of this Agreement, the Agreement may not be
modified, altered or changed, except through a writing signed by both Parties.
On the Anniversary Date of this Agreement, Sucampo reserves the unilateral right
to modify any term of this Agreement except for the terms of Section B.1,
Section H. Section I or Section N so long as Sucampo complies with the notice
requirements in Section A.2 above. If Executive rejects Sucampo’s modified
Agreement that complies with Section N, Sucampo may elect to employ Executive
at-will without an employment agreement, or either party may end Executive’s
employment under the terms of Section H.

 

 

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O.Notices.

 

Executive and Sucampo agree that all notices or other communications required or
permitted under this Agreement shall be deemed to be sufficient only if
contained in a written instrument given by personal delivery, air courier or
registered or certified mail, postage prepaid, return receipt requested,
addressed to such party at the address set forth below or such other address as
may thereafter be designated in a written notice from such party to the other
party:

 

  To Sucampo:   Sucampo Pharmaceuticals, Inc.       Attn: Executive Vice
President, Global Human Resources, Information Technology and Strategy      
Copy to: General Counsel       805 King Farm Boulevard, Suite 550      
Rockville, Maryland 20850                   To Executive:   Peter Greenleaf    
  #### ##### ####       ######, ##### #####

 

All such notices, advances and communications shall be deemed to have been
delivered and received (1) in the case of personal delivery, on the date of such
delivery, (2) in the case of air courier, on the business day after the date
when sent and (3) in the case of mailing, on the third business day following
such mailing.

 

P.                 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and both of which, taken
together shall constitute one and the same instrument. Signatures to this
Agreement transmitted by facsimile transmission, by electronic mail in “portable
document format” (“.pdf”) form, or by any other electronic means intended to
preserve the original graphic and pictorial appearance of a document, shall have
the same effect as physical delivery of the paper document bearing the original
signature.

 

 

 

 

 

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EXECUTIVE KNOWINGLY AND FREELY AGREES TO ALL THE TERMS OF THIS AGREEMENT,
INCLUDING THE MUTUAL AGREEMENT TO ARBITRATE CLAIMS THAT OTHERWISE COULD HAVE
BEEN BROUGHT IN COURT. EXECUTIVE AFFIRMS THAT EXECUTIVE HAS HAD SUFFICIENT TIME
TO READ AND UNDERSTAND THE TERMS OF THIS AGREEMENT AND HAS BEEN ADVISED OF
EXECUTIVE’S RIGHT TO SEEK LEGAL COUNSEL REGARDING THE MEANING AND EFFECT OF THIS
AGREEMENT PRIOR TO SIGNING.

 

EXECUTIVE:

 

 

[pg1.jpg]   8/3/2016  

Executive (signature)

  Date                           Peter Greenleaf       Executive (printed name)
                      SUCAMPO PHARMACEUTICALS, INC.               [jj.jpg]      
John Johnson (signature)   Date   Lead Independent Director      

 

 

 

 

 

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EXHIBIT 1

INVENTIONS, INTELLECTUAL PROPERTY AND EQUIPMENT CERTIFICATE

 

 

 

I hereby certify that I have set forth below a complete list and brief
description of all Inventions, intellectual property and equipment located at
the Company which is owned directly or indirectly by me and which shall not be
transferred to the Company pursuant to the terms of that certain Amended and
Restated Employment Agreement (the “Agreement") entered into between Sucampo
Pharmaceuticals, Inc., a Delaware corporation, and me, and me, of even date
herewith.

 

I further certify that I have complied with and will continue to comply with all
the terms of the Agreement.

 

List of Items: [none]

 

 

 

 

 

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SIGNATURE

          Peter Greenleaf   Print Name       8/3/2016   Date

 

 

 

 

 

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