Exhibit 10.1


 


EMPLOYMENT
AGREEMENT


 


This EMPLOYMENT
AGREEMENT (this “Agreement”), dated as of March 12, 2015 (the “Effective Date”), is by and
between MATINAS BIOPHARMA HOLDINGS, INC., a Delaware corporation (the “Company”) and Douglas F. Kling (the “Executive”).


 


W I T N E
S S E T H:


 


WHEREAS, the
Company desires to employ the Executive as its Senior Vice President, Clinical Development and Project Management and the Executive
desires to accept such employment, on the terms and conditions set forth in this Agreement; and


 


WHEREAS, the
Company and the Executive have mutually agreed that, as of the Effective Date, this Agreement shall govern the terms of employment
between the Executive and the Company.


 


NOW, THEREFORE,
in consideration of the promises and the mutual covenants and agreements contained herein and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound hereby, agree as
follows:


 


ARTICLE
1

Employment; TERM OF AGREEMENT


 


Section 1.1.            Employment
and Acceptance. During the Term (as defined in Section 1.2), the Company shall employ the Executive, and the Executive
shall accept such employment and serve the Company, in each case, subject to the terms and conditions of this Agreement.


 


Section 1.2.            Term.
The employment relationship hereunder shall be for the period commencing on the Effective Date and, subject to earlier termination
as provided in ARTICLE 4, ending on the third anniversary of the Effective Date (the “Term”). In the
event that the Executive’s employment with the Company terminates, the Company’s obligation to continue to pay, after
the Termination Date (as defined in Section 4.2(b)), Base Salary (as defined in Section 3.1(a)), Annual Bonus (as
defined in Section 3.1(b)) and other unaccrued benefits shall terminate, except as may be provided for in ARTICLE 4.


 


ARTICLE
2

TITLE; DUTIES AND OBLIGATIONS; LOCATION


 


Section 2.1.            Title.
The Company shall employ the Executive to render exclusive and full-time services to the Company. The Executive shall serve in
the capacity of Senior Vice President, Clinical Development and Project Management.


 






    	 



    	 



    

 


Section 2.2.            Duties.
The Executive shall report to the Company’s Chief Executive Officer and be subject to the lawful direction of the Company’s
Board of Directors (the “Board”). The Executive agrees to perform to the best of his ability, experience and
talent those acts and duties, consistent with the position of Senior Vice President, Clinical Development and Project Management
as the Board (and/or the Chief Executive Officer) shall from time to time direct. During the Term, the Executive also shall serve
in such other executive-level positions or capacities as may, from time to time, be reasonably requested by the Board and/or the
CEO, including, without limitation (subject to election, appointment, re-election or re-appointment, as applicable) as (a) a member
of the Board and/or as a member of the board of directors or similar governing body of any of the Company’s subsidiaries
or other Affiliates (as defined below), (b) an officer of any of the Company’s subsidiaries or other Affiliates, and/or (c)
a member of any committee of the Company and/or any of its subsidiaries or other Affiliates, in each case, for no additional compensation.
As used in this Agreement, “Affiliate” of any individual or entity means any other individual or entity that
directly or individual controls, is controlled by, or is under common control with, the individual or entity. For avoidance of
doubt, any election of the Executive as a member of the Board is independent from the employment of the Executive under this Agreement
and subject to normal procedures, bylaws and agreements regulating the election and/or removal of the members of the Board; provided,
however, that, as set forth above, such service shall be for no additional compensation.


 


Section 2.3.            Compliance
with Policies, etc. During the Term, the Executive shall be bound by, and comply fully with, all of the Company’s policies
and procedures for employees and officers in place from time to time, including, but not limited to, all terms and conditions set
forth in the Company’s employee handbook, compliance manual, codes of conduct and any other memoranda and communications
applicable to the Executive pertaining to the policies, procedures, rules and regulations, as currently in effect and as may be
amended from time to time. These policies and procedures include, among other things and without limitation, the Executive’s
obligations to comply with the Company’s rules regarding confidential and proprietary information and trade secrets.


 


Section 2.4.            Time
Commitment. During the Term, the Executive shall use his best efforts to promote the interests of the Company (including its
subsidiaries and other Affiliates) and shall devote all of his business time, ability and attention to the performance of his duties
for the Company and shall not, directly or indirectly, render any services to any other person or organization, whether for compensation
or otherwise, except with the Board’s prior written consent or as specified on Exhibit C of the Covenants Agreement (as defined
in Section 5.1), provided that the foregoing shall not prevent the Executive from (i) participating in charitable, civic,
educational, professional, community or industry affairs, or (ii) managing the Executive’s passive personal investments,
so long as, in each case, such activities individually or in the aggregate do not materially interfere or conflict with the Executive’s
duties hereunder or create a potential business or fiduciary conflict (in each case, as determined by the Board).


 


Section 2.5.            Location.
The Executive’s principal place of business for the performance of his duties under this Agreement shall be at the principal
executive office of the Company. Notwithstanding, the foregoing, the Executive shall be required to travel as necessary to perform
his duties hereunder.


 


ARTICLE
3

COMPENSATION AND BENEFITS; EXPENSES


 


Section 3.1.            Compensation
and Benefits. For all services rendered by the Executive in any capacity during the Term (including, without limitation, serving
as an officer, director or member of any committee of the Company or any of its subsidiaries or other Affiliates), the Executive
shall be compensated as follows (subject, in each case, to the provisions of Article
4 below):


 






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(a)            Base Salary.
During the Term, the Company shall pay the Executive a base salary (the “Base Salary”) at the annualized rate
of 250,000, which shall be subject to customary withholdings and authorized deductions and be payable in equal installments in
accordance with the Company’s customary payroll practices in place from time to time. The Executive’s Base salary shall
be subject to periodic adjustments as the Board and/or the Compensation Committee of the Board (the “Compensation Committee”)
shall in its/their discretion deem appropriate. As used in this Agreement, the term “Base Salary” shall refer
to Base Salary as may be adjusted from time to time.


 


(b)            Annual Bonus.
For each calendar year ending during the Term (beginning with the calendar year ending December 31, 2015), the Executive shall
be eligible to receive an annual bonus (the “Annual Bonus”) with a target amount equal to thirty percent (30%)
of the Base Salary earned by the Executive for such calendar year (the “Target Annual Bonus”). The actual amount
of each Annual Bonus will be based upon the level of achievement of the Company’s corporate objectives and the Executive’s
individual objectives, in each case, as established by the Board or the Compensation Committee (taking into account the input of
the Chief Executive Officer with respect to the establishment of the Executive’s individual objectives) for the calendar
year with respect to which such Annual Bonus relates. The determination of the level of achievement of the corporate objectives
and the Executive’s individual performance objectives for a year shall be made by the Board or the Compensation Committee
Committee (taking into account the input of the Chief Executive Officer with respect to the level of achievement of the Executive’s
individual objectives), in its reasonable discretion. Each Annual Bonus for a calendar year, to the extent earned, will be paid
in a lump sum in the following calendar year, within the first 75 days of such following year. The Annual Bonus shall not be deemed
earned until the date that it is paid. Accordingly, in order for the Executive to receive an Annual Bonus, the Executive must be
actively employed by the Company at the time of such payment.


 


(c)            Equity Compensation.
The Compensation Committee has approved a grant to the Executive (to be made on Executive’s first day of employment) of options
to purchase up to 350,000 shares of the Company’s common stock pursuant to the Company’s 2013 Equity Compensation Plan
(the “2013 Plan”), on the terms and conditions determined by the Compensation Committee, with such grant subject
to stockholder approval of the Company’s 2013 Equity Compensation Plan. During the Term, subject to the terms and conditions
established within the 2013 Plan or any successor equity compensation plan as may be in place from time to time and separate Award
Agreements (as defined in the 2013 Plan), the Executive also shall be eligible to receive from time to time additional Stock Options,
Stock Unit Awards, Performance Shares, Performance Units, Incentive Bonus Awards, Other Cash-Based Awards and/or Other Stock-Based
Awards (as such capitalized terms are defined in the 2013 Plan), in amounts, if any, to be approved by the Board or the Compensation
Committee in its discretion.


 






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(d)            Benefit Plans.
The Executive shall be entitled to participate in all employee benefit plans and programs (excluding severance plans, if any) generally
made available by the Company to senior executives of the Company, to the extent permissible under the general terms and provisions
of such plans or programs and in accordance with the provisions thereof. The Company may amend, modify or rescind any employee
benefit plan or program and/or change employee contribution amounts to benefit costs without notice in its discretion.


 


(e)            Paid Vacation.
The Executive shall be entitled to paid vacation days in accordance with the Company’s vacation policies in effect from time
to time for its executive team; provided, however, that the Executive shall be entitled to no less than fifteen (15) paid vacation
days per calendar year during the Term.


 


Section 3.2.            Expense
Reimbursement. The Company shall reimburse the Executive during the Term, in accordance with the Company’s expense reimbursement
policies in place from time, for all reasonable out-of-pocket business expenses incurred by the Executive in the performance of
his duties hereunder. In order to receive such reimbursement, the Executive shall furnish to the Company documentary evidence of
each such expense in the form required to comply with the Company’s policies in place from time to time.


 


ARTICLE
4

TERMINATION OF EMPLOYMENT


 


Section 4.1.            Termination
Without Cause or Resignation for Good Reason.


 


(a)            The Company
may terminate the Executive’s employment hereunder at any time without Cause (other than by reason of death or Disability)
upon sixty (60) days prior written notice to the Executive. Executive may terminate his employment hereunder for Good Reason upon
written notice to the Company in accordance with the provisions set forth in Section 4.1(c).


 


(b)            As used in
this Agreement, “Cause” means: (i) a material act, or act of fraud, committed by the Executive that is intended
to result in the Executive’s personal enrichment to the detriment or at the expense of the Company or any of its Affiliates;
(ii) the Executive is convicted of a felony; (iii) gross negligence or willful misconduct by the Executive, or failure by the Executive
to perform the duties or obligations reasonably assigned to the Executive by the Board or the CEO from time to time, which is not
cured upon ten (10) days prior written notice (unless such negligence, misconduct or failure is not susceptible to cure, as determined
in the reasonable discretion of the Board); or (iv) the Executive violates the Covenants Agreement (as defined in Section 5.1
below).


 


(c)            As used in
this Agreement, “Good Reason” means the occurrence of any of the following: (1) a material breach by the Company
of the terms of this Agreement; (2) a material reduction in the Executive’s Base Salary; (3) a material diminution in the
Executive’s authority, duties or responsibilities; or (4) a material change in the geographic location at which the Executive
performs services for the Company; provided, however, that the Executive must notify the Company within ninety (90) days of the
occurrence of any of the foregoing conditions that he considers it to be a “Good Reason” condition and provide the
Company with at least thirty (30) days in which to cure the condition. If the Executive fails to provide this notice and cure period
prior to his resignation, or resigns more than six (6) months after the initial existence of the condition, his resignation will
not be deemed to be for “Good Reason.”


 






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(d)            If the Executive’s
employment is terminated pursuant to Section 4.1(a) other than during the Post-Change in Control Period (as defined in Section
4.1(e)), the Executive shall, in full discharge of all of the Company’s obligations to the Executive, be entitled to
receive, and the Company’s sole obligation to the Executive under this Agreement or otherwise shall be to pay or provide
to the Executive, the following:


 


(i)            the
Accrued Obligations (as defined in Section 4.2(b));


 


(ii)            six
(6) months accelerated vesting of all of the Executive’s outstanding stock options, restricted stock and other equity incentive
awards; and


 


(iii)            
subject to Section 4.4 and Section 4.5:


 


(A)            payments
equal to nine (9) months of the Executive’s Base Salary (at the rate in effect immediately prior to the Termination Date)
(less applicable withholdings and authorized deductions), to be paid in equal installments bimonthly in accordance with the Company’s
customary payroll practices, commencing sixty (60) days following the Termination Date (the “Pre-CIC Severance Payments”);
and


 


(B)            if
the Executive then participates in the Company’s medical and/or dental plans and the Executive timely elects to continue
and maintain group health plan coverage pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”),
the Company will pay monthly, on the Executive’s behalf, a portion of the cost of such coverage for the nine (9) months after
the Termination Date, which payments will be equal to the amount of the monthly premium for such coverage, less the amount that
the Executive would have been required to pay if the Executive had remained an active employee of the Company (the “Pre-CIC
COBRA Assistance”); provided, however, that if and to the extent that the Company may not provide such
Pre-CIC COBRA Assistance without incurring tax penalties or violating any requirement of the law, the Company shall use its commercially
reasonable best efforts to provide substantially similar assistance in an alternative manner provided that the cost of doing so
does not exceed the cost that the Company would have incurred had the Pre-CIC COBRA Assistance been provided in the manner described
above or cause a violation of Section 409A (as defined in Section 5.16).


 


(e)            If the Executive’s
employment is terminated pursuant to Section 4.1(a) during the twenty-four (24) months immediately following a Change in
Control (as defined below) (the “Post-Change in Control Period”), the Executive shall, in full discharge of
all of the Company’s obligations to the Executive (and in lieu of any payments and benefits set forth in Section 4.1(d)),
be entitled to receive, and the Company’s sole obligation to the Executive under this Agreement or otherwise shall be to
pay or provide to the Executive, the following:


 


(i)            the
Accrued Obligations;


 


(ii)            full
accelerated vesting of all of the Executive’s outstanding stock options, restricted stock and other equity incentive awards;
and


 






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(iii)            
subject to Section 4.4 and Section 4.5:


 


(A)            payments
equal to eighteen (18) months of the Executive’s Base Salary (at the rate in effect immediately prior to the Termination
Date) (less applicable withholdings and authorized deductions), to be paid in equal installments bimonthly in accordance with the
Company’s customary payroll practices, commencing sixty (60) days following the Termination Date (the “Post-CIC
Severance Payments”);


 


(B)            if
the Executive then participates in the Company’s medical and/or dental plans and the Executive timely elects to continue
and maintain group health plan coverage pursuant to COBRA, the Company will pay monthly, on the Executive’s behalf, a portion
of the cost of such coverage for the eighteen (18) months after the Termination Date, which payments will be equal to the amount
of the monthly premium for such coverage, less the amount that the Executive would have been required to pay if the Executive had
remained an active employee of the Company (the “Post-CIC COBRA Assistance”); provided, however,
that if and to the extent that the Company may not provide such Post-CIC COBRA Assistance without incurring tax penalties or violating
any requirement of the law, the Company shall use its commercially reasonable best efforts to provide substantially similar assistance
in an alternative manner provided that the cost of doing so does not exceed the cost that the Company would have incurred had the
Post-CIC COBRA Assistance been provided in the manner described above or cause a violation of Section 409A; and


 


(C)            a
payment equal to the Executive’s Target Annual Bonus for the calendar year in which the Termination Date occurs, payable
in a lump sum on the 60th day following the Termination Date.


 


(f)            As used in
this Agreement, “Change in Control” means (x) a change in ownership of the Company under clause (i) below or
(y) a change in the ownership of a substantial portion of the assets of the Company under clause (ii) below:


 


(i)            Change
in the Ownership of the Company. A change in the ownership of the Company shall occur on the date that any one person, or more
than one person acting as a group (as defined in clause (iii) below), acquires ownership of capital stock of the Company that,
together with capital stock held by such person or group, constitutes more than 50 percent of the total fair market value or total
voting power of the capital stock of the Company. However, if any one person or more than one person acting as a group, is considered
to own more than 50 percent of the total fair market value or total voting power of the capital stock of the Company, the acquisition
of additional capital stock by the same person or persons shall not be considered to be a change in the ownership of the Company.
An increase in the percentage of capital stock owned by any one person, or persons acting as a group, as a result of a transaction
in which the Company acquires capital stock in the Company in exchange for property will be treated as an acquisition of stock
for purposes of this paragraph.


 






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(ii)            
Change in the Ownership of a Substantial Portion of the Company’s Assets. A change in the ownership of a substantial
portion of the Company’s assets shall occur on the date that any one person, or more than one person acting as a group (as
defined in clause (iii) below), acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition
by such person or persons) assets from the Company that have a total gross fair market value equal to or more than 80 percent of
the total gross fair market value of all of the assets of the Company immediately prior to such acquisition or acquisitions. For
this purpose, gross fair market value means the value of the assets of the Company, or the value of the assets being disposed of,
determined without regard to any liabilities associated with such assets. There is no Change in Control under this clause (ii)
when there is a transfer to an entity that is controlled by the shareholders of the Company immediately after the transfer, as
provided below in this clause (ii). A transfer of assets by the Company is not treated as a change in the ownership of such assets
if the assets are transferred to (a) a shareholder of the Company (immediately before the asset transfer) in exchange for or with
respect to its capital stock, (b) an entity, 50 percent or more of the total value or voting power of which is owned, directly
or indirectly, by the Company, (c) a person, or more than one person acting as a group, that owns, directly or indirectly, 50 percent
or more of the total value or voting power of all the outstanding capital stock of the Company, or (d) an entity, at least 50 percent
of the total value or voting power of which is owned, directly or indirectly, by a person described in clause (ii)(c) of this paragraph.
For purposes of this clause (ii), a person's status is determined immediately after the transfer of the assets.


 


(iii)            
Persons Acting as a Group. For purposes of clauses (i) and (ii) above, persons will not be considered to be acting as a
group solely because they purchase or own capital stock or purchase assets of the Company at the same time. However, persons will
be considered to be acting as a group if they are owners of a corporation that enters into a merger, consolidation, purchase or
acquisition of assets or capital stock, or similar business transaction with the Company. If a person, including an entity, owns
stock in both corporations that enter into a merger, consolidation, purchase or acquisition of assets or capital stock, or similar
transaction, such shareholder is considered to be acting as a group with other shareholders in a corporation only with respect
to the ownership in that corporation before the transaction giving rise to the change and not with respect to the ownership interest
in the other corporation. For purposes of this paragraph, the term “corporation” shall have the meaning assigned such
term under Treasury Regulation section 1.280G-1, Q&A-45.


 


(iv)            
Each of clauses (i) through (iii) above shall be construed and interpreted consistent with the requirements of Section 409A and
any Treasury Regulations or other guidance issued thereunder.


 


Section 4.2.            Termination
for Cause; Voluntary Termination; Expiration of Term.


 


(a)            The Company
may terminate the Executive’s employment hereunder at any time for Cause upon written notice to the Executive. The Executive
may voluntarily terminate his employment hereunder at any time without Good Reason upon sixty (60) days prior written notice to
the Company; provided, however, the Company reserves the right, upon written notice to the Executive, to accept the
Executive’s notice of resignation and to accelerate such notice and make the Executive’s resignation effective immediately,
or on such other date prior to Executive’s intended last day of work as the Company deems appropriate. It is understood and
agreed that the Company’s election to accelerate Executive’s notice of resignation shall not be deemed a termination
by the Company without Cause for purposes of Section 4.1 of this Agreement or otherwise or constitute Good Reason (as defined
in Section 4.1) for purposes of Section 4.1 of this Agreement or otherwise. The Executive’s employment shall
automatically terminate upon the expiration of the Term in accordance with Section 1.2.


 






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(b)            If the Executive’s
employment is terminated pursuant to Section 4.2(a), the Executive shall, in full discharge of all of the Company’s
obligations to the Executive, be entitled to receive, and the Company’s sole obligation under this Agreement or otherwise
shall be to pay or provide to the Executive, the following (collectively, the “Accrued Obligations”):


 


(i)            the
Executive’s earned, but unpaid, Base Salary through the final date of the Executive’s employment by the Company (the
“Termination Date”), payable in accordance with the Company’s standard payroll practices;


 


(ii)            the
Executive’s accrued, but unused, vacation (in accordance with the Company’s policies);


 


(iii)            
expenses reimbursable under Section 3.2 above incurred on or prior to the Termination Date but not yet reimbursed; and


 


(iv)            
any amounts or benefits that are vested amounts or vested benefits or that the Executive is otherwise entitled to receive under
any plan, program, policy or practice (with the exception of those, if any, relating to severance) on the Termination Date, in
accordance with such plan, program, policy, or practice.


 


Section
4.3.            Termination Resulting from Death or Disability.


 


(c)            As the result
of any Disability suffered by the Executive, the Company may, upon five (5) days prior notice to the Executive, terminate the Executive’s
employment under this Agreement. The Executive’s employment shall automatically terminate upon his death.


 


(d)            “Disability”
means a determination by the Company in accordance with applicable law that as a result of a physical or mental injury or illness,
the Executive is unable to perform the essential functions of his job with or without reasonable accommodation for a period of
(i) ninety (90) consecutive days; or (ii) one hundred twenty (120) days during any twelve (12) month period.


 


(e)            If the Executive’s
employment is terminated pursuant to Section 4.3(a), the Executive or the Executive’s estate, as the case may be,
shall be entitled to receive, and the Company’s sole obligation under this Agreement or otherwise shall be to pay or provide
to the Executive or the Executive’s estate, as the case may be, the Accrued Obligations.


 


Section 4.4.            Release
Agreement. In order to receive the Pre-CIC Severance Payments or the Post-CIC Severance Payments (collectively referred to
herein as the “Severance Payments”) or the Pre-CIC COBRA Assistance or the Post-CIC COBRA Assistance (collectively
referred to herein as the “COBRA Assistance”) set forth in Section 4.1 (if eligible), the Executive must
timely execute (and not revoke) a separation agreement and general release (the “Release Agreement”) in a customary
form as is determined to be reasonably necessary by the Company in its good faith and reasonable discretion. If the Executive is
eligible for Severance Payments and COBRA Assistance pursuant to Section 4.1, the Company will deliver the Release Agreement
to the Executive within seven (7) calendar days following the Termination Date. The Severance Payments and COBRA Assistance are
subject to the Executive’s execution of such Release Agreement within 45 days of the Executive’s receipt of the Release
Agreement and the Executive’s non-revocation of such Release Agreement.


 






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Section 4.5.            Post-Termination
Breach. Notwithstanding anything to the contrary contained in this Agreement, the Company’s obligations to provide the
Severance Payments and the COBRA Assistance will immediately cease if the Executive breaches any of the provisions of the Covenants
Agreement, the Release Agreement or any other agreement the Executive has with the Company.


 


Section 4.6.            Removal
from any Boards and Position. If the Executive’s employment is terminated for any reason under this Agreement, he shall
be deemed (without further action, deed or notice) to resign (i) if a member, from the Board or board of directors (or similar
governing body) of any Affiliate of the Company or any other board to which he has been appointed or nominated by or on behalf
of the Company and (ii) from all other positions with the Company or any subsidiary or other Affiliate of the Company, including,
but not limited to, as an officer of the Company and any of its subsidiaries or other Affiliates.


 


ARTICLE
5

GENERAL PROVISIONS


 


Section 5.1.             Company
Non-Disclosure and Invention Assignment Agreement. The Executive acknowledges and confirms that the Non-Disclosure and Invention
Assignment Agreement executed by the Executive in favor of the Company as of the Effective Date (“Covenants Agreement”),
the terms of which are incorporated herein by reference, remains in full force and effect and binding upon the Executive. The Covenants
Agreement shall survive the termination of this Agreement and the Executive’s employment by the Company for the applicable
period(s) set forth therein.


 


Section 5.2.            Expenses.
Each of the Company and the Executive shall bear its/his own costs, fees and expenses in connection with the negotiation, preparation
and execution of this Agreement.


 


Section 5.3.            Entire
Agreement. This Agreement and the Covenants Agreement contain the entire agreement of the parties hereto with respect to the
terms and conditions of the Executive’s employment during the Term and activities following termination of this Agreement
and the Executive’s employment with the Company and supersede any and all prior agreements and understandings, whether written
or oral, between the parties hereto with respect to the subject matter of this Agreement or the Covenants Agreement. Each party
hereto acknowledges that no representations, inducements, promises or agreements, whether oral or in writing, have been made by
any party, or on behalf of any party, which are not embodied herein or in the Covenants Agreement. The Executive acknowledges and
agrees that the Company has fully satisfied, and has no further, obligations to the Executive arising under, or relating to, any
other employment or consulting arrangement or understanding (including, without limitation, any claims for compensation or benefits
of any kind) or otherwise. No agreement, promise or statement not contained in this Agreement or the Covenants Agreement shall
be valid and binding, unless agreed to in writing and signed by the parties sought to be bound thereby.


 






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Section 5.4.            No
Other Contracts. The Executive represents and warrants to the Company that neither the execution and delivery of this Agreement
by the Executive nor the performance by the Executive of the Executive’s obligations hereunder, shall constitute a default
under or a breach of the terms of any other agreement, contract or other arrangement, whether written or oral, to which the Executive
is a party or by which the Executive is bound, nor shall the execution and delivery of this Agreement by the Executive nor the
performance by the Executive of his duties and obligations hereunder give rise to any claim or charge against either the Executive,
the Company or any Affiliate, based upon any other contract or other arrangement, whether written or oral, to which the Executive
is a party or by which the Executive is bound. The Executive further represents and warrants to the Company that he is not a party
to or subject to any restrictive covenants, legal restrictions or other agreement, contract or arrangement, whether written or
oral, in favor of any entity or person which would in any way preclude, inhibit, impair or limit the Executive’s ability
to perform his obligations under this Agreement, including, but not limited to, non-competition agreements, non-solicitation agreements
or confidentiality agreements. The Executive shall defend, indemnify and hold the Company harmless from and against all claims,
actions, losses, liabilities, damages, costs and expenses (including reasonable attorney’s fees and amounts paid in settlement
in good faith) arising from or relating to any breach of the representations and warranties made by the Executive in this Section
5.4.


 


Section 5.5.            Notices.
Any notice or other communication required or permitted hereunder shall be in writing and shall be delivered personally or sent
by nationally recognized overnight courier service (with next business day delivery requested). Any such notice or communication
shall be deemed given and effective, in the case of personal delivery, upon receipt by the other party, and in the case of a courier
service, upon the next business day, after dispatch of the notice or communication. Any such notice or communication shall be addressed
as follows:


 


If to
the Company, to:


 


Matinas BioPharma Holdings, Inc.


1545 Route 206 South, Suite 302


Bedminster, NJ 07921


Attn: Chief Executive Officer


 


With
a copy to: 


 


Lowenstein
Sandler PC


1251 Avenue
of the Americas


New York,
New York 10020


Attn: Michael
J. Lerner, Esq.


 






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If to
the Executive, to:


 


Douglas F. Kling


45 Philhower Road


Lebanon, NJ 08833


 


With
a copy to: 


 


___________________


____________________


 


 


Any person named above
may designate another address or fax number by giving notice in accordance with this Section to the other persons named above.


 


Section 5.6.            Governing
Law; Jurisdiction. This Agreement shall be governed by, and construed in accordance with, the laws of the State of New Jersey,
without regard to principles of conflicts of law. Any and all actions arising out of this Agreement or Employee’s employment
by Company or termination therefrom shall be brought and heard in the state and federal courts of the State of New Jersey and the
parties hereto hereby irrevocably submit to the exclusive jurisdiction of any such courts. The
Company and the Executive HEREBY WAIVE THEIR RESPECTIVE RIGHT TO TRIAL BY JURY IN ANY ACTION CONCERNING THIS AGREEMENT OR
ANY AND ALL MATTERS ARISING DIRECTLY OR INDIRECTLY HEREFROM AND REPRESENT THAT THEY HAVE CONSULTED WITH COUNSEL OF THEIR CHOICE
OR HAVE CHOSEN VOLUNTARILY NOT TO DO SO SPECIFICALLY WITH RESEPCT TO THIS WAIVER.


 


Section 5.7.            Waiver.
Either party hereto may waive compliance by the other party with any provision of this Agreement. The failure of a party to insist
on strict adherence to any term of this Agreement on any occasion shall not be considered a waiver or deprive that party of the
right thereafter to insist upon strict adherence to that term or any other term of this Agreement. No waiver of any provision shall
be construed as a waiver of any other provision. Any waiver must be in writing.


 


Section 5.8.            Severability.
If any one or more of the terms, provisions, covenants and restrictions of this Agreement shall be determined by a court of competent
jurisdiction to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Agreement
shall remain in full force and effect and shall in no way be affected, impaired or invalidated and the parties will attempt to
agree upon a valid and enforceable provision which shall be a reasonable substitute for such invalid and unenforceable provision
in light of the tenor of this Agreement, and, upon so agreeing, shall incorporate such substitute provision in this Agreement.
In addition, if any one or more of the provisions contained in this Agreement shall for any reason be determined by a court of
competent jurisdiction to be excessively broad as to duration, geographical scope, activity or subject, it shall be construed,
by limiting or reducing it, so as to be enforceable to the extent compatible with then applicable law.


 






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Section 5.9.            Counterparts.
This Agreement may be executed in any number of counterparts and each such duplicate counterpart shall constitute an original,
any one of which may be introduced in evidence or used for any other purpose without the production of its duplicate counterpart.
Moreover, notwithstanding that any of the parties did not execute the same counterpart, each counterpart shall be deemed for all
purposes to be an original, and all such counterparts shall constitute one and the same instrument, binding on all of the parties
hereto.


 


Section 5.10.            Advice
of Counsel. This Agreement was prepared by Lowenstein Sandler LLP in its capacity as legal counsel to the Company. Both parties
hereto acknowledge that they have had the opportunity to seek and obtain the advice of counsel before entering into this Agreement
and have done so to the extent desired, and have fully read the Agreement and understand the meaning and import of all the terms
hereof.


 


Section 5.11.            Assignment.
This Agreement shall inure to the benefit of the Company and its successors and assigns (including, without limitation, the purchaser
of all or substantially all of its assets) and shall be binding upon the Company and its successors and assigns. This Agreement
is personal to the Executive, and the Executive shall not assign or delegate his rights or duties under this Agreement, and any
such assignment or delegation shall be null and void.


 


Section 5.12.            Agreement
to Take Actions. Each party to this Agreement shall execute and deliver such documents, certificates, agreements and other
instruments, and shall take all other actions, as may be reasonably necessary or desirable in order to perform his or its obligations
under this Agreement.


 


Section 5.13.            No
Attachment. Except as required by law, no right to receive payments under this Agreement shall be subject to anticipation,
commutation, alienation, sale, assignment, encumbrance, charge, pledge, or hypothecation or to execution, attachment, levy or similar
process or assignment by operation of law, and any attempt, voluntary or involuntary, to effect any such action shall be null,
void and of no effect; provided, however, that nothing in this Section 5.13 shall preclude the assumption
of such rights by executors, administrators or other legal representatives of the Executive or the Executive’s estate and
their assigning any rights hereunder to the person or persons entitled thereto.


 


Section 5.14.            Source
of Payment. Except as otherwise provided under the terms of any applicable employee benefit plan, all payments provided for
under this Agreement shall be paid in cash from the general funds of Company. The Company shall not be required to establish a
special or separate fund or other segregation of assets to assure such payments, and, if the Company shall make any investments
to aid it in meeting its obligations hereunder, the Executive shall have no right, title or interest whatever in or to any such
investments except as may otherwise be expressly provided in a separate written instrument relating to such investments. Nothing
contained in this Agreement, and no action taken pursuant to its provisions, shall create or be construed to create a trust of
any kind, or a fiduciary relationship, between Company and the Executive or any other person. To the extent that any person acquires
a right to receive payments from Company hereunder, such right, without prejudice to rights which employees may have, shall be
no greater than the right of an unsecured creditor of Company. The Executive shall not look to the owners of the Company for the
satisfaction of any obligations of the Company under this Agreement.


 






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Section 5.15.            Tax
Withholding. The Company or other payor is authorized to withhold from any benefit provided or payment due hereunder, the amount
of withholding taxes due any federal, state or local authority in respect of such benefit or payment and to take such other action
as may be necessary in the opinion of the Board to satisfy all obligations for the payment of such withholding taxes. The Executive
will be solely responsible for all taxes assessed against him with respect to the compensation and benefits described in this Agreement,
other than typical employer-paid taxes such as FICA, and the Company makes no representations as to the tax treatment of such compensation
and benefits.


 


Section 5.16.            409A
Compliance. All payments under this Agreement are intended to comply with or be exempt from the requirements of Section 409A
of the Code and regulations promulgated thereunder (“Section 409A”). As used in this Agreement, the “Code”
means the Internal Revenue Code of 1986, as amended. To the extent permitted under applicable regulations and/or other guidance
of general applicability issued pursuant to Section 409A, the Company reserves the right to modify this Agreement to conform with
any or all relevant provisions regarding compensation and/or benefits so that such compensation and benefits are exempt from the
provisions of 409A and/or otherwise comply with such provisions so as to avoid the tax consequences set forth in Section 409A and
to assure that no payment or benefit shall be subject to an “additional tax” under Section 409A. To the extent that
any provision in this Agreement is ambiguous as to its compliance with Section 409A, or to the extent any provision in this Agreement
must be modified to comply with Section 409A, such provision shall be read in such a manner so that no payment due to the Executive
shall be subject to an “additional tax” within the meaning of Section 409A(a)(1)(B) of the Code. If necessary to comply
with the restriction in Section 409A(a)(2)(B) of the Code concerning payments to “specified employees,” any payment
on account of the Executive’s separation from service that would otherwise be due hereunder within six (6) months after such
separation shall be delayed until the first business day of the seventh month following the Termination Date and the first such
payment shall include the cumulative amount of any payments (without interest) that would have been paid prior to such date if
not for such restriction. Each payment in a series of payments hereunder shall be deemed to be a separate payment for purposes
of Section 409A. In no event may the Executive, directly or indirectly, designate the calendar year of payment. All reimbursements
provided under this Agreement shall be made or provided in accordance with the requirements of Section 409A, including, where applicable,
the requirement that (i) any reimbursement is for expenses incurred during the Executive’s lifetime (or during a shorter
period of time specified in this Agreement), (ii) the amount of expenses eligible for reimbursement during a calendar year may
not affect the expenses eligible for reimbursement in any other calendar year, (iii) the reimbursement of an eligible expense will
be made on or before the last day of the calendar year following the year in which the expense is incurred, and (iv) the right
to reimbursement is not subject to liquidation or exchange for another benefit. Notwithstanding anything contained herein to the
contrary, the Executive shall not be considered to have terminated employment with the Company for purposes of Section 4.1
unless the Executive would be considered to have incurred a “termination of employment” from the Company within the
meaning of Treasury Regulation §1.409A-1(h)(1)(ii). In no event whatsoever shall the Company be liable for any additional
tax, interest or penalty that may be imposed on the Executive by Section 409A or damages for failing to comply with Section 409A.


 




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Section 5.17.            280G
Modified Cutback.


 


(a)            If any payment,
benefit or distribution of any type to or for the benefit of the Executive, whether paid or payable, provided or to be provided,
or distributed or distributable pursuant to the terms of this Agreement or otherwise (collectively, the “Parachute Payments”)
would subject the Executive to the excise tax imposed under Section 4999 of the Code (the “Excise Tax”), the
Parachute Payments shall be reduced so that the maximum amount of the Parachute Payments (after reduction) shall be one dollar
($1.00) less than the amount which would cause the Parachute Payments to be subject to the Excise Tax; provided that the Parachute
Payments shall only be reduced to the extent the after-tax value of amounts received by the Executive after application of the
above reduction would exceed the after-tax value of the amounts received without application of such reduction. For this purpose,
the after-tax value of an amount shall be determined taking into account all federal, state, and local income, employment and excise
taxes applicable to such amount. Unless the Executive shall have given prior written notice to the Company to effectuate a reduction
in the Parachute Payments if such a reduction is required, which notice shall be consistent with the requirements of Section 409A
to avoid the imputation of any tax, penalty or interest thereunder, then the Company shall reduce or eliminate the Parachute Payments
by first reducing or eliminating accelerated vesting of stock options or similar awards, then reducing or eliminating any cash
payments (with the payments to be made furthest in the future being reduced first), then by reducing or eliminating any other remaining
Parachute Payments; provided, that no such reduction or elimination shall apply to any non-qualified deferred compensation amounts
(within the meaning of Section 409A) to the extent such reduction or elimination would accelerate or defer the timing of such payment
in manner that does not comply with Section 409A.


 


(b)            An initial
determination as to whether (x) any of the Parachute Payments received by the Executive in connection with the occurrence of a
change in the ownership or control of the Company or in the ownership of a substantial portion of the assets of the Company shall
be subject to the Excise Tax, and (y) the amount of any reduction, if any, that may be required pursuant to the previous paragraph,
shall be made by an independent accounting firm selected by the Company (the “Accounting Firm”) prior to the
consummation of such change in the ownership or effective control of the Company or in the ownership of a substantial portion of
the assets of the Company. The Executive shall be furnished with notice of all determinations made as to the Excise Tax payable
with respect to the Executive’s Parachute Payments, together with the related calculations of the Accounting Firm, promptly
after such determinations and calculations have been received by the Company.


 






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(c)            For purposes
of this Section 5.17, (i) no portion of the Parachute Payments the receipt or enjoyment of which the Executive shall have
effectively waived in writing prior to the date of payment of the Parachute Payments shall be taken into account; (ii) no portion
of the Parachute Payments shall be taken into account which in the opinion of the Accounting Firm does not constitute a “parachute
payment” within the meaning of Section 280G(b)(2) of the Code; (iii) the Parachute Payments shall be reduced only to the
extent necessary so that the Parachute Payments (other than those referred to in the immediately preceding clause (i) or (ii))
in their entirety constitute reasonable compensation for services actually rendered within the meaning of Section 280G(b)(4) of
the Code or are otherwise not subject to disallowance as deductions, in the opinion of the auditor or tax counsel referred to in
such clause (ii); and (iv) the value of any non-cash benefit or any deferred payment or benefit included in the Parachute Payments
shall be determined by the Company’s independent auditors based on Sections 280G and 4999 of the Code and the regulations
for applying those sections of the Code, or on substantial authority within the meaning of Section 6662 of the Code.


 


[Signature Page Follows]


 




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IN WITNESS WHEREOF,
the parties hereto have executed this Agreement as of the day and year first above written.


 


	 	COMPANY
	 	 
	 	MATINAS
BIOPHARMA HOLDINGS, INC.
	 	 
	 	 
	 	By: 	/s/ Roelof Rongen
	 	Name:
Title:	Roelof Rongen
Chief Executive Officer
	 	 	 
	 	 	 
	 	EXECUTIVE
	 	 	 
	 	 	 
	 	/s/ Douglas F. Kling
	 	Douglas F. Kling
	 	 	 



 



    	[SIGNATURE PAGE TO EMPLOYMENT AGREEMENT]