Exhibit 10.1


 


SEPARATION
AGREEMENT AND MUTUAL RELEASE


 


This
Separation Agreement and Mutual Release (hereinafter “Agreement”), is made and entered into by and between Boris Maslov
(“Employee”) and Ener-Core, Inc., a Delaware corporation (the “Company”), with reference to the following:


 


A.      Employee
was employed by the Company pursuant to the terms of an Employment Agreement effective as of December 31, 2012, and Amendment
to Employment Agreement effective as of May 23, 2014 (collectively, the “Employment Agreement”).


 


B.       Employee
and the Company (collectively, the “Parties”) now mutually desire to end the employment relationship pursuant to the
terms of this Agreement and this Agreement shall be in lieu of any severance payments, benefits or notice provisions as provided
in the Employment Agreement.


 


C.       The
Parties further desire to settle, compromise, and resolve fully and finally any and all claims and disputes, whether known or
unknown, which exist or could exist on Employee’s behalf against the Company, and on the Company’s behalf against
the Employee, from the beginning of time through the date of execution of this Agreement.


 


NOW,
THEREFORE, in consideration of the covenants and promises contained herein, the Parties hereto agree as follows:


 


1.       Termination
of Employment Relationship. The Company and Employee have mutually agreed to terminate the employment relationship effective
on January 31, 2017 (“the Termination Date”). On the Termination Date, Employee shall be paid for all accrued but
unused paid time off (vacation), as well as all salary earned and unpaid through the Termination Date; Employee shall further
be entitled to any pending reimbursement for Company expenses incurred by Employee prior to the Termination Date in accordance
with Company policies. At the Termination Date, Employee hereby resigns from (i) all officer positions with the Company (including
without limitation the positions of President, Chief Operating Officer and Chief Technology Officer of the Company) and any officer,
director or employee positions with its subsidiaries and affiliates and (ii) any fiduciary, administrative or other committees
or powers, including with respect to any employee benefit plans or bank accounts of the Company. Employee understands and agrees
that he is no longer authorized to act for or on behalf of the Company in any capacity except as directed and that the terms of
his Employment Agreement will be terminated effective on the Termination Date, except for those provisions that are specifically
intended to survive termination as indicated in the Employment Agreement or incorporated by reference in this Agreement. Notwithstanding
anything herein, Company and Employee acknowledge and agree that Sections 7 and 8 of the Employee Agreement are, by this Agreement,
specifically intended not to survive or have any effect upon the payments being made, and to be made, hereunder. Employee further
understands and agrees that all rights and benefits relating to employment with the Company shall be forever terminated on the
Termination Date and that Employee is not entitled to receive and will not claim any compensation, payments or benefits from the
Company except for those payments and benefits that are expressly set forth in this Agreement, and that this Agreement is expressly
intended to supersede and replace any severance pay or benefits that Employee might otherwise claim pursuant to his Employment
Agreement, specifically including those set forth in Sections 7 and 8 therein. However, upon termination, Employee shall be entitled
to receive any rights and benefits as a terminated employee with respect to Employee’s participation in the Company’s
health and welfare and/or retirement benefit plans, which shall be provided pursuant to operation of law and under the terms of
those respective plans. Employee will be provided with COBRA notice in a separate writing after the Termination Date that sets
forth information relating to his entitlement to COBRA coverage.


 






     

     


    

 


2.       Severance
Payments and Post-Termination Obligations. 


 


		a.	After
                                         the Effective Date of this Agreement, and provided that Employee complies with all of
                                         the terms of this Agreement, the Company agrees to pay Employee as severance pay a total
                                         severance amount of $90,000 (the “Severance Obligation”) to be paid in eighteen
                                         (18) equal semi-monthly installments on the 15th day and last day of each
                                         month after the Termination Date (commencing February 15, 2017), less applicable statutory
                                         deductions and tax withholdings. Employee agrees that he shall be solely responsible
                                         for any taxes that may be due and owing as a result of payments made pursuant to this
                                         Agreement. The Company may, in its sole discretion, accelerate the payment of the unpaid
                                         balance of the Severance Obligation at any time, less applicable statutory deductions
                                         and tax withholdings.



 


		b.	Employee
                                         acknowledges and agrees that, as of the Termination Date, other than as explicitly set
                                         forth in this Agreement, he is no longer entitled to any other compensation set forth
                                         in his Employment Agreement or pursuant to Company bonus policies, including without
                                         limitation any bonus or incentive compensation, and that any unvested options Employee
                                         holds pursuant to the Company’s incentive plan(s) are hereby relinquished pursuant
                                         to the terms thereof.



 


		c.	As
                                         of the Termination Date, Employee and the Company shall enter into an advisory services
                                         agreement, in the form attached hereto as Exhibit A, pursuant to which Employee
                                         shall provide services to the Company as an advisory board member as set forth therein.



 


3.       Release
of All Claims - Employee. In accordance with the requirements of the Employment Agreement, and as consideration for the
obligations under Section 2 of this Agreement and the release provided in Section 6 of this Agreement, to which Employee is not
otherwise entitled, Employee agrees as follows:


 


		a.	Except
                                         for the payments and other benefits expressly set forth in this Agreement, Employee,
                                         on behalf of himself, his heirs, legal representatives, successors-in-interest, and assigns,
                                         does hereby irrevocably and unconditionally release, acquit, and forever discharge the
                                         Company, including all of its past, present, and future parents, subsidiaries, affiliated
                                         companies, and owners and all of their past, present, and future predecessors, successors,
                                         assigns, agents, directors, officers, employees, representatives, attorneys, and insurers
                                         and all persons acting by, through, under, or in concert with any of them (collectively.
                                         “Company Released Parties”), and each of them, of and from all claims, complaints,
                                         actions, causes of action, rights, demands, debts, obligations, damages, or accountings
                                         of whatever nature, in law or in equity, whether known or unknown, which Employee may
                                         have, in the past may have had, or in the future may have against Company Released Parties,
                                         or any of them, including but not limited to, any and all claims relating to the Employment
                                         Agreement or any other claims based on any contract, express or implied, or breach of
                                         the covenant of good faith and fair dealing; any claims for stock options and/or any
                                         stock, equity or other ownership interest in the Company; any claims for wrongful termination,
                                         violation of public policy, constructive discharge, emotional distress, personal injury,
                                         invasion of privacy, defamation, fraud, misrepresentation, breach of fiduciary duty,
                                         unfair business practices, tortious interference, or any other tort or common law claims;
                                         any and all claims for wages, salary, bonuses, commissions, overtime pay, premium pay,
                                         vacation pay, severance pay, benefits, contributions or any other claims for compensation;
                                         any and all claims for damages (including general, special, compensatory, consequential,
                                         liquidated or punitive damages); any and all claims for costs, expenses, attorneys’
                                         fees, interest, civil or criminal penalties, waiting time penalties, or any other available
                                         remedy; and any and all claims arising under any federal, state, city and/or other governmental
                                         statute, law, regulation or ordinance relating to employment, including but not limited
                                         to (as amended), Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1991,
                                         the Equal Employment Opportunity Act of 1972, the Americans with Disabilities Act, the
                                         Age Discrimination in Employment Act, the Older Worker Benefit Protection Act, the Family
                                         and Medical Leave Act, the Employee Retirement Income Security Act, the California Labor
                                         Code and any applicable Wage Order, the California Business and Professions Code, the
                                         California Family Rights Act, the California Fair Employment and Housing Act covering
                                         discrimination, harassment and retaliation in employment on any protected basis as established
                                         by law (herein collectively, “Claims”).



 






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		b.	Employee
                                         is also waiving his right to any monetary recovery if such Claims are pursued on his
                                         behalf. Employee confirms that (to his knowledge) Employee has suffered no injuries or
                                         occupational diseases in connection with his employment with the Company that may be
                                         compensable under any state worker’s compensation laws. Employee confirms that
                                         he does not have any pending claim, charge, or suit against the Company Released Parties
                                         or any of their employees in any federal, state, or local court or administrative agency.



 


4.       Waiver
of Rights Under Section 1542. IT IS FURTHER UNDERSTOOD AND AGREED BY EMPLOYEE THAT HE HEREBY EXPRESSLY WAIVES AND RELINQUISHES
ANY AND ALL CLAIMS, RIGHTS OR BENEFITS THAT EMPLOYEE MAY HAVE UNDER CALIFORNIA CIVIL CODE SECTION 1542, WHICH PROVIDES AS FOLLOWS:


 


“A
general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time
of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.”


 


In
connection with such waiver and relinquishment, Employee acknowledges that Employee may hereafter discover claims or facts in
addition to or different from those which Employee now knows or believes to exist with respect to the matters released herein,
but that Employee expressly agrees to fully, finally and forever settle and release any and all claims, known or unknown, suspected
or unsuspected, which exist or may exist on Employee’s behalf against the Company Released Parties at the time of execution
of this Agreement, including, but not limited to, any and all claims relating to or arising from Employee’s employment with
the Company or the termination of that employment.


 






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5.       ADEA
Release and Effective Date. This Agreement includes a release of claims under the federal Age Discrimination in Employment
Act (“ADEA”), 29 U.S.C. § 626, et seq, including the Older Workers Benefit Protection Act, and in connection
with such waiver and release:


 


		a.	Employee
                                         is hereby advised to consult with an attorney of Employee’s choice (and at Employee’s
                                         own cost) prior to signing this Agreement;



 


		b.	Employee
                                         shall have a period of twenty-one (21) days from January 31, 2017, the date Employee
                                         first received this Agreement, in which to review and consider the terms of this Agreement.
                                         Employee understands and agrees that the subsequently negotiated and agreed revisions
                                         to the Agreement do not extend this initial 21-day period. Employee may execute this
                                         Agreement at any time during the 21-day period;



 


		c.	Employee
                                         may revoke this Agreement in writing at any time during the first seven (7) days following
                                         Employee’s execution of this Agreement (the “Revocation Period”), and
                                         this Agreement shall not be effective or enforceable until the Revocation Period has
                                         expired. If Employee revokes this Agreement by properly notifying in writing an authorized
                                         representative of the Company of its revocation during the Revocation Period, then this
                                         Agreement shall not be effective or enforceable. Accordingly, the “Effective Date”
                                         of this Agreement shall be on the eighth (8th) day after Employee signs this Agreement
                                         and returns it to the Company, and provided that Employee does not revoke the Agreement
                                         during the Revocation Period.



 


		d.	Employee
                                         acknowledges and agrees that the payments, benefits, further engagement and releases
                                         to be provided to Employee as set forth in this Agreement are in addition to anything
                                         of value that Employee would otherwise be entitled to receive from the Company upon a
                                         mutual separation and constitute valid consideration in exchange for the release of federal
                                         age claims as set forth in this Agreement.



 


6.       Release
of All Claims - Company. As consideration for the releases provided in Section 3 and 4 of this Agreement, other than the
Employee’s obligations set forth in this Agreement and the advisory services agreement referenced herein, the Company, on
behalf of itself, its subsidiaries, affiliates, past, present, and future predecessors, successors, assigns, agents, directors,
officers, employees, and other representatives, does hereby irrevocably and unconditionally release, acquit, and forever discharge
the Employee from all claims, complaints, actions, causes of action, rights, demands, debts, obligations, damages, or accountings
of whatever nature, in law or in equity, whether known or unknown, which the Company may have, in the past may have had, or in
the future may have against Employee, or any of them, including but not limited to, any and all claims relating to the Employment
Agreement, the employment relationship and any other relationships between Company and Employee that are terminated hereby, or
any other claims based on any contract, express or implied, or breach of the covenant of good faith and fair dealing; any claims
for violation of public policy or Company policy; emotional distress, personal injury, invasion of privacy, defamation, fraud,
misrepresentation, breach of fiduciary duty, unfair business practices, tortious interference, or any other tort or common law
claims; any and all claims for damages (including general, special, compensatory, consequential, liquidated or punitive damages);
any and all claims for costs, expenses, attorneys’ fees, interest, civil or criminal penalties, waiting time penalties,
or any other available remedy; and any and all claims arising under any federal, state, city and/or other governmental statute,
law, regulation or ordinance relating to employment.


 






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7.       Waiver
of Rights Under Section 1542. IT IS FURTHER UNDERSTOOD AND AGREED BY COMPANY THAT IT HEREBY EXPRESSLY WAIVES AND RELINQUISHES
ANY AND ALL CLAIMS, RIGHTS OR BENEFITS THAT COMPANY MAY HAVE UNDER CALIFORNIA CIVIL CODE SECTION 1542, WHICH PROVIDES AS FOLLOWS:


 


“A
general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time
of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.”


 


In
connection with such waiver and relinquishment, Company acknowledges that Company may hereafter discover claims or facts in addition
to or different from those which Company now knows or believes to exist with respect to the matters released herein, but that
Company expressly agrees to fully, finally and forever settle and release any and all claims, known or unknown, suspected or unsuspected,
which exist or may exist on Company’s behalf against the Employee at the time of execution of this Agreement, including,
but not limited to, any and all claims relating to or arising from Company’s employment of the Employee or the termination
of that employment.


 


8.       No
Filing of Claims. The Parties represent and warrant, that as of the date of this Agreement, neither Party presently has
on file any claims, charges, grievances, actions, appeals or complaints against the Employee or the Company Released Parties,
as applicable, in or with any administrative, state, federal or governmental entity, agency, board or court, or before any other
tribunal or panel of arbitrators, public or private, based upon any actions by such Parties that are alleged to have occurred
prior to the date of this Agreement. To the extent any such claims or actions do exist as of the date of this Agreement, each
Party represents and agrees to dismiss, with prejudice, any and all such claims and, if such Party does not have the authority
or ability to dismiss any such claims, such Party hereby expressly agrees that he shall not personally recover or receive any
monetary damages or award relating to any such claims, provided, nothing in this Agreement shall negate, limit or otherwise
prohibit the Employee from exercising his rights communicate with any federal government agency regarding any potential violation
of federal law or regulation, including without limitation to engage with the U.S. Securities and Exchange Commission pursuant
to Section 21F(h) of the Securities Exchange Act of 1934, as amended, and the rules promulgated thereunder (“Reserved Rights”).
If applicable, the relevant Party may present this Agreement to any such agency or court as a basis to seek such dismissal or
denial of monetary relief.


 


9.       Ownership
of Claims. The Parties represent and warrant that each is the sole and lawful owner of all rights, title and interest
in and to all released matters, claims and demands as herein contained and that there has been no assignment or other transfer
of any interest of any claim or demand which either may have against the Employee or the Company Released Parties, as applicable.


 


10.     Non-Admission
of Liability. It is expressly understood and agreed by the Parties that nothing contained in this Agreement shall constitute
or be treated as an admission of any wrongdoing or liability on the part of any Party to this Agreement. Each Party expressly
denies that the Employee or the Company Released Parties have engaged in any wrongful or unlawful conduct of any kind or in any
violation of law relating to Employee’s employment relationship with the Company.


 


11.     Confidentiality.
Employee acknowledges that he previously agreed to be bound by the provisions of his Employment Agreement addressing preservation
of Confidential Information and protection of the Company’s intellectual property, and, as a condition of this Agreement,
he acknowledges and confirms that those terms and conditions of his Employment Agreement shall survive the termination of the
employment relationship and shall remain fully enforceable against Employee after the Termination Date, pursuant to the terms
of the Employment Agreement, provided, nothing in such provisions shall negate or undermine the Reserved Rights as set
forth in Section 8 above. Employee acknowledges that this Agreement shall be filed publicly by the Company with the U.S. Securities
and Exchange Commission.


 






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12.     Return
of Company Property. As a condition of receiving the severance payment set forth in Section 2 above, except as otherwise
instructed by the Company pursuant to the advisory services agreement referenced herein, Employee agrees to return to the Company
on or before the Termination Date all the Company property, equipment, devices, files, documents and data of any kind, whether
stored in paper, disk, tape or any other electronic form, that Employee has in his possession or control. Employee further represents
and agrees that, to the extent he subsequently discovers any Company documents or property of any kind after the Termination Date,
he will promptly return the same (and any copies) to the Company in the same condition that he found them.


 


13.     Attorneys
Fees and Costs. If any legal action is brought under this Agreement for an asserted breach or to enforce any of its terms,
the prevailing party shall be entitled to recover costs and reasonable attorneys fees; provided, however, that,
to the extent the issues raised in any claim or dispute under this Agreement are based on state or federal statutes that provide
for attorneys fees to the prevailing party, then the basis for awarding such attorneys fees shall be consistent with the applicable
standards for awarding attorneys fees to the prevailing party under those respective state or federal statutes and applicable
laws.


 


14.     California
Law Applies. This Agreement, in all respects, shall be interpreted, enforced and governed by and under the laws of the
State of California.


 


15.     Successors
and Assigns. It is expressly understood and agreed by the Parties that this Agreement and all of its terms shall be binding
upon the Parties’ respective representatives, heirs, executors, administrators, successors and assigns. This Agreement and
the releases from the Parties contained herein shall inure to the benefit of the Employee or Company Released Parties, as applicable.


 


16.     Severability.
In the event any provision of this Agreement shall be found by a court of competent jurisdiction to be void, invalid or unenforceable,
the provision shall be deemed modified to the fullest extent permitted by law to cure the invalid or unenforceable provision consistent
with the intent of the Parties, and if that is not possible, then the void, invalid or unenforceable provision shall be deleted
and severed from this Agreement but only to the extent that it does not materially change the terms of this Agreement or alter
the intent of the Parties, and all other provisions of this Agreement shall remain in full force and effect.


 


17.     Integration;
Modification. This Agreement, the Employment Agreement and the advisory services agreement attached hereto to Exhibit
A, constitute a single, integrated, written contract expressing the entire agreement between the Parties regarding the termination
of Employee’s employment and they supersede and replace all prior agreements or understandings between the Parties relating
to the subject matter of this Agreement, whether written, oral or implied. Each Party represents and warrants to the other that
such Party is not relying on any promises, representations or inducements of any kind which do not appear written herein. Each
Party further agrees that this Agreement can be amended or modified only by a written agreement, signed by all Parties.


 


18.     Counterparts.
This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, and all counterparts
so executed shall constitute one agreement binding on all of the Parties hereto, notwithstanding that all of the Parties are not
signatory to the same counterpart. This Agreement may be executed and transmitted either by original, facsimile, or electronic
delivery, each of which will be equally binding as an original upon receipt by the other Party.


 






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19.     Understanding
and Voluntary Agreement. By signing below, Employee confirms that he is competent to execute this Agreement. Employee
understands and agrees that he may be waiving significant legal rights by signing this Agreement. Employee represents and agrees
that he has entered into this Agreement voluntarily, with a full understanding of and in agreement with all of its terms, and
after having had the opportunity to consult with an attorney of his choice. By signing below, Company confirms that its entry
into this Agreement has been authorized by the Company’s board of directors and that the Company’s signatory was specifically
authorized to execute and deliver this Agreement on behalf of the Company.


 


20.     Section
409A. This Agreement is intended to comply, to the extent applicable, with the provisions of Section 409A of the Internal
Revenue Code of 1986, as amended (“Section 409A”), and shall, to the extent practicable, be construed in accordance
with such section. For purposes of this Agreement, each amount to be paid or benefit to be provided will be construed as a separate
identified payment for purposes of Section 409A, and any payments that are due within the “short term deferral period”
as defined in Section 409A will not be treated as deferred compensation unless applicable law requires otherwise. Notwithstanding
anything contained herein to the contrary, to the extent required in order to avoid accelerated taxation and/or additional taxes
under Section 409A, amounts reimbursable to Employee under this Agreement shall be paid to Employee on or before the last day
of the year following the year in which the expense was incurred and the amount of expenses eligible for reimbursement (and in-kind
benefits provided to Employee) during any one year may not effect amounts reimbursable or provided in any subsequent year.


 


21.     Interpretation.
This Agreement is to be interpreted in accordance with its fair meaning and not strictly for or against any Party. This Agreement
will not be construed more strictly against one Party than against the other merely by virtue of the fact that it may have been
prepared by counsel for one of the Parties, it being recognized that all Parties have contributed substantially and materially
to the preparation of this Agreement.


 


IN
WITNESS WHEREOF, the Parties hereto have executed this Separation Agreement and Mutual Release on the dates indicated below.


 


	Dated:
    February 1, 2017	BORIS
    MASLOV
	 	 
	 	/s/
    Boris A. Maslov


 


	Dated:
    February 1, 2017	ENER-CORE,
    INC.
	 	 	 
	 	By:	/s/
    Domonic J. Carney
	 	Its:	CFO





 






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EXHIBIT
A


 


Advisory
Services Agreement


 


[Omitted]