EX-10.23



 EXHIBIT 10.23 

BOARD OF DIRECTORS SERVICES AGREEMENT 

This Board of Directors Services Agreement (this “Agreement”) is effective as of January 1, 2014 (the “Effective
Date”) by and between KemPharm, Inc., an Iowa corporation (the “Company”), and Joseph B. Saluri, an individual with a principal place of residence in Adel, Iowa (the “Director”) (each a “Party”
and together, the “‘Parties”). 
 WHEREAS, the Company desires to retain the services of the Director for the benefit
of the Company and its stockholders; and 
 WHEREAS, the Director desires to serve on the Company’s Board of Directors (the
“Board”) for the period of time and subject to the terms and conditions set forth herein; 
 NOW, THEREFORE, in
consideration of the above recited promises and the mutual agreements and covenants of the Company and the Director contained herein, the Parties hereby agree as follows: 

1. DUTIES AND EXTENT OF SERVICES. Commencing
as of the Effective Date, the Director agrees to provide services to the Company as a member of the Board. For so long as he serves as a member of the Board, the Director shall perform those services and duties that are required of a director under
the Company’s articles of incorporation and bylaws, as both may be amended and restated from time to time (the “Articles and Bylaws”), and under the Iowa Business Corporation Act, Chapter 490 of the Code of Iowa, as amended
(the “Iowa Business Corporation Act”), and other state and federal laws and regulations, as applicable, and shall render such services as are customarily associated with and are incident to the position of a director of a for-profit
corporation and such other services as the Company, from time to time, may reasonably require of him consistent with such position. Without limiting the preceding sentence, the Company acknowledges that the Director has other business commitments,
including commitments to serve as an officer and employee of Stein Seed Company and its affiliates and as a director of other companies. The Director shall promptly disclose to the Company’s president or general counsel any actual, apparent or
potential conflicts of interest that arise from time to time with respect to the Director’s service on the Board. 
 2.
COMPENSATION. 
 (a) Cash Stipend. 

(1) Board Service. As compensation for the Director’s entering into this Agreement and performing his services as a
member of the Board, the Company shall pay to the Director on a quarterly basis a cash stipend in an annualized amount of $25,000 with the first quarterly payment due at the end of the first quarter of the Company’s 2014 fiscal year. The
Company shall continue to pay the quarterly cash stipend due hereunder through and until the last fiscal quarter during which the Director served on the Board, after which no further stipend amounts shall be due under this Agreement. Payments shall
be made in accordance with the Company’s regular accounting practices. 

  
 - 1 - 








 (2) Committee Service. For any fiscal quarter year of the Company during
which the Director serves on any of the following Board committees, the quarterly stipend payable at the end of such quarter shall be increased by the following annualized amounts: (i) service on the Board’s compensation committee as chair
shall increase the stipend by an annualized amount of $5,000; (ii) service on the Board’s compensation committee other than as chair shall increase the stipend by an annualized amount of $1,500; (iii) service on the Board’s
nominating and governance committee as chair shall increase the stipend by an annualized amount of $2,500; and (iv) service on the Board’s governance committee other than as chair shall increase the stipend by an annualized amount of
$1,500. 
 (b) Stock Options. As additional compensation for the Director entering into this Agreement and performing
his services as a member of the Board, the Company shall grant to the Director options to purchase shares of the Company’s common stock which are consistent with the following terms. Such option grants shall be made pursuant to the
Company’s incentive stock plan and shall be treated by the Parties as nonqualified stock options for federal income tax purposes. Each option grant shall be memorialized in a written agreement (the “Option Agreements”) with
terms and conditions that are satisfactory to the Company and substantially consistent with the terms and conditions of option grants issued other Board members. 

(1) Effective as of the Effective Date, the Company shall grant to the Director the right to purchase up to 55,000 shares of
the Company’s common stock. The price per share at which shares may be purchased pursuant to this grant shall be the fair market value of a share of the Company’s common stock as of the Effective Date as determined by the Company’s
Board. The Director’s purchase option under this grant shall vest in accordance with the following: 
 (i) The right to
purchase 45,000 shares shall vest in increments of one-third on each of the following vesting dates if the Director is still serving as a Board member on such vesting date: December 31, 2014, December 31, 2015 and December 31,
2016; 
 (ii) The right to purchase 5,000 shares shall vest upon the sale by the Company of shares of its capital stock
pursuant to a private placement offering exempt from registration under the Securities Act of 1933, as amended, with sale proceeds of at least $5,000,000. This vesting rule shall apply only to the first such private placement offering to occur after
the Effective Date; and 
 (iii) The right to purchase 5,000 shares shall vest upon the closing of the Company’s sale
of shares of its common stock to the public in an underwritten public offering pursuant to a registration statement under the Securities Act of 1933, as amended, if the proceeds of such sale exceed $15,000,000 and in connection therewith the
Company’s common stock becomes publicly traded on the New York stock Exchange, American Stock Exchange or Nasdaq Stock Market. 

  
 - 2 - 








 (2) Effective as of the date of each annual meeting of the Company’s
shareholders, commencing with the annual meeting in 2015, the Company shall grant to the Director the right to purchase up to 25,000 shares of the Company’s common stock if the Director has continuously served as a member of the Board up until
the date of such meeting. The price per share at which shares may be purchased pursuant to this grant shall be the fair market value of a share of the Company’s common stock as of the effective date of the grant as determined by the
Company’s board. The Director’s purchase option under this grant shall vest in increments of one-third over a period of three (3) years subject to the Director’s continued service as a Board member during such period. 

(c) Other Benefits. While the Director serves as a member of the Board, the Director shall be entitled to any other
benefits made available to all of the other non-executive members of the Board generally. 
 3. EXPENSE
REIMBURSEMENT. The Company agrees to reimburse the Director for all reasonable and necessary travel, business entertainment and other out-of-pocket business expenses incurred by him in connection with the
performance of his duties as a Board member upon receipt of substantiating documentation relating to such expenses as the Company may reasonably require. Unless the Company otherwise pre-authorizes, the Director shall have the Company make any
airplane and hotel reservations related to the Director’s service as a Board member, and the Director shall comply with such other reasonable expense policies and practices that the Company imposes on Board members. 

4. TERMINATION. The Director shall have the right, exercisable at any time, to resign as a Board member.
The Company and its shareholders shall have the right to not reelect the Director to the Board or to remove the Director from the Board to the fullest extent permitted under the Articles and Bylaws and under the Iowa Business Corporation Act. The
Parties rights and obligations under sections 2,(b), 5 - 7 hereof and under the Option Agreements shall survive any termination of the Director’s service as a Board member. 

5. LIMITATION OF LIABILITY AND
INDEMNIFICATION. To the fullest extent permitted under the Articles and Bylaws and the Iowa Business Corporation Act, the Director shall not be personally liable to the Company or its shareholders for monetary
damages for any act of omission in connection with the performance of his services as a Board member, and the Company shall indemnify the Director against and hold him harmless from any liability to third parties by reason of the fact that he was a
Board member. 
 6. CONFIDENTIALITY OBLIGATIONS. 

(a) Definition of Confidential Information. As used in this Agreement, the Company’s “Confidential
Information” means any proprietary information of the Company (or any subsidiary or parent company) which is disclosed to the Director in the course of the performance of his services as a Board member and which was not or is not in the
public domain at the time of its disclosure to the Director, whether or not in writing, whether or not marked as “confidential” or “proprietary” by the Company. “Confidential Information” includes, without limitation,
all of the following types of information, written or verbal, to the extent such information is not in the public domain at the time of its disclosure to the Director, whether or not in writing or marked as “confidential” or


  
 - 3 - 








 
“proprietary”: any information and comments disclosed at meetings of the Board or Board committees; any information, comments and advise disclosed by or to the Company’s
attorney(s) within any attorney-client communication; information set forth within all business, strategic and development plans; financial information; business and employment records and relationships; employee and advisor lists; discoveries and
inventions; ideas; concepts; specifications; designs; diagrams; drawings; models; flow charts; chemical and molecular structures; synthetic pathways and techniques; development route; manufacturing processes; data (biological, safety, clinical,
developmental, analytical and/or other kinds of data); records and ideas constituting, arising from or relating to research and development; invention disclosures; work papers and materials supporting or underlying patents and patent applications;
trade secrets, know-how; co-developer identities; and the existence and terms of agreements between the Company and one or more third parties (including, without limitation, any agreements between the Company and Shire LLC). The Company’s
Confidential Information may include Confidential Information that the Company has obtained from a third party under a duty of confidentiality. 

(b) Nondisclosure and Non-Use Covenants. The Director acknowledges that the unlawful use or disclosure of Confidential
Information received from the Company may cause irreparable damage and financial loss to the Company. Accordingly, the Director agrees that while he is a member of the Company’s Board and for a period of five (5) years following the
earliest date on which the Director is no longer a member of the Board, he will: (i) protect the confidentiality and prevent the unauthorized use or disclosure of all Confidential Information with at least the same degree of care that the
Directors uses to protect his own proprietary, confidential information, but in no case less than reasonable care; (ii) not disclose any Confidential Information nor make any use of Confidential Information except as necessary and directly
related to the performance of his services as a Board member; (iii) not intentionally use the Confidential Information in any way that is detrimental to the Company; and (iv) not disclose Confidential Information to any other person who is
not an officer or director of the Company without the prior written consent of the Company’s president or the chairman of the Board. 

(c) Exceptions. The Director’s confidentiality obligations set forth above in Section 6(b) shall not apply to
any Confidential Information which: 
 (1) is or later becomes generally available to the public without breach of any
obligation of confidentiality by the Director; 
 (2) written evidence reasonably confirms was in the possession of the
Director prior to its receipt from the Company; 
 (3) is later acquired by the Director from a third party without any
restriction on disclosure or breach of an obligation of confidentiality; 
 (4) the Director can demonstrate that the
Director independently created such information without reference or use of Confidential Information; or 

  
 - 4 - 








 (5) the Director is required to disclose pursuant to any governmental order, law
or other valid legal process, provided, however that: (i) prior to such disclosure the Director shall provide the Company with prompt written notice of the requirement so that the Company may object to such disclosure or to seek a protective
order or other appropriate remedy and/or waive the Director’s compliance with the provisions of this Agreement; and (ii) if, in the absence of a protective order or the receipt of a waiver hereunder, the Director, in the opinion of the
Director’s legal counsel, is nonetheless compelled to disclose Confidential Information of the Company to any tribunal or else stand liable for contempt or suffer some other censure or penalty, the Director shall disclose only that portion of
such Confidential Information which the Director’s counsel advises it is legally required to disclose to such tribunal without liability under this Agreement. 

(d) Return of Confidential Information. Promptly upon the request of the Company, the Director shall cease any and all
further use or disclosure of the Confidential Information and, at his election, either return or destroy all copies of any media or materials containing the Company’s Confidential Information, including all documentation, notes, plans,
drawings, computer records and copies of the foregoing; provided, however, that (i) the Director may retain one copy of such Confidential Information for his legal files solely for the purpose of monitoring compliance with applicable
confidentiality obligations pursuant to this Agreement, and (ii) the obligation to return or destroy Confidential Information shall not cover information the Director maintains on routine computer system backup tapes, disks or other backup
storage devices as long as such back-up information is not used, disclosed, or otherwise recovered from such backup devices. Notwithstanding the Director’s retention of Confidential Information for his legal files, the Director will continue to
be bound by the confidentiality and other obligations under this Agreement. 
 (e) Remedies. The Director understands
and acknowledges that the actual or threatened disclosure or misappropriation, of any of the Confidential Information in violation of this Agreement may cause the Company irreparable harm, the amount of which may be difficult to ascertain and,
therefore, agrees that the Company shall have the right to apply to a court of competent jurisdiction for an order restraining any such further disclosure or misappropriation and for other such relief as the Company may deem appropriate. Such right
of the Company shall be in addition to remedies otherwise available to the Company at law or in equity, including, without limitation, all rights and remedies of the Company under its Articles and Bylaws and the Iowa Business Corporation Act. 

7. INDEPENDENT CONTRACTOR STATUS. The Director shall be an independent
contractor of the Company. No terms of this Agreement shall be construed to confer employment status upon the Director, and the Director shall not be entitled to workers’ compensation coverage, unemployment insurance benefits or any employee
benefits provided by the Company to its employees. The Director shall be solely responsible for the payment of all required taxes due for the compensation paid hereunder, whether federal, state or local in nature, including but not limited to,
income taxes, social security taxes, unemployment compensation taxes, and any other assessments. 
 8. REPRESENTATION
BY DIRECTOR. The Director represents and warrants to the Company that his service on the Board and the terms of this Agreement do not conflict with or breach any other contractual or legal obligations
that the Director may have. 

  
 - 5 - 








 9. REPRESENTATION BY COMPANY.
The Company represents and warrants to the Director that the execution, delivery and performance by the Company of this Agreement and the Option Agreements have been duly authorized by all necessary corporate action on the part of the Corporation to
make this Agreement and the Option Agreements valid and binding upon the Company in accordance with their respective terms, 
 10.
GOVERNING LAW; VENUE. This Agreement shall be governed by and construed in accordance with the laws of the State of Iowa, without reference to principles of conflict of laws. The
Director hereby irrevocably consents to the exclusive jurisdiction of the courts of the State of Iowa and the United States District Court for the Southern District of Iowa, and the respective appellate courts for such courts, for the purpose of any
suit, action or other proceeding arising out of the Parties’ obligations and performances under this Agreement, and expressly waives any and all objections he may have to venue in such courts. 

11. AMENDMENT AND WAIVER. This Agreement may not be amended except by a
written instrument signed both by Parties which specifically refers to the particular provision or provisions being amended. No provision of this Agreement may be waived except in a written instrument that specifically refers to the particular
provision or provisions being waived and is signed by the Party against whom the waiver is being asserted. No waiver by any Party of any right, power or privilege hereunder shall constitute a waiver of any other right, power or privilege hereunder,
and no waiver by any party of any breach of a provision hereunder shall constitute a waiver of any other breach of that or any other provision of this Agreement. 

12. NOTICES. All notices, requests, demands and other communications provided in connection with this
Agreement shall be in writing and may be delivered to each Party by hand, deposited with an overnight courier, sent by confirmed email or confirmed facsimile or mailed, in each case to the address, email address, telephone number or facsimile number
set forth below such Party’s signature hereto or such other address as may hereafter be furnished in writing. Such notice shall be deemed to have been given as of (i) the date on which it is delivered, in the case of notice given by hand
delivery, overnight courier or email, (ii) the date on which transmission confirmation is received in the case of notice given by facsimile, and (iii) three (3) days after such notice is deposited in the U.S. mail. 

13. SEVERABILITY. If any term or other provision of this Agreement is held to be illegal, invalid or
unenforceable by any rule of law or public policy, the remaining provisions of this Agreement shall remain in full force and effect and shall not be affected by such illegal, invalid or unenforceable provision or by its severance from this
Agreement. If any provision of this Agreement is so broad as to be unenforceable, the provision shall be interpreted to be only as broad as is enforceable. 

14. RULES OF CONSTRUCTION. Headings to sections and paragraphs of this
Agreement are for reference only, and do not form a part of this Agreement, or effect the interpretation of this Agreement. Whenever the context of this Agreement requires, a reference to any gender includes each other gender, and the singular
number includes the plural and vice versa. 
 15. ENTIRE AGREEMENT; CONFLICTING
TERMS AND CONDITIONS. This Agreement and the Option Agreemenst constitute the entire agreement and understanding of the Parties with respect to the subjects matter hereof; provided,
however, that the terms and conditions of this Agreement shall not be deemed to eliminate or reduce any fiduciary duties of the Director under the Articles and 

  
 - 6 - 








 
Bylaws and/or the Iowa Business Corporation Act. In the event of any conflict between the terms and conditions of this Agreement and the terms and conditions of the Articles and Bylaws and/or the
provisions of the Iowa Business Corporation Act with respect to the Director’s duties to the Company and its shareholders and/or his confidentiality obligations and/or the rights and remedies of the Company and its shareholders with respect to
the Director’s breach of any duty or contractual obligation to the Company and its shareholders, the conflicting term, condition or provision which is more favorable to the Company shall apply, 

16. COUNTERPARTS. This Agreement may be executed in any number of counterparts, including by transmission
of facsimile or PDF copies of signature pages, each of which shall be deemed for all purposes to be an original and all of which taken together shall constitute one instrument. All signatures of the Parties transmitted by facsimile or PDF shall be
deemed to be their original signatures for all all purposes. 
 [Signature Page Follows] 

  
 - 7 - 








 SIGNATURE PAGE 

TO 

BOARD OF DIRECTORS SERVICES AGREEMENT 

IN WITNESS WHEREOF, the Parties hereby acknowledge having entered into this Agreement. 

 

					
	DIRECTOR:				 COMPANY:
 KemPharm,
Inc.

			
	/s/ Joseph B. Saluri		By:		/s/ Travis C. Mickle, President
	Joseph B. Saluri				Travis C. Mickle, President

  

									
	Address:		 				Address:		 2656 Crosspark Road, Suite 100

Coralville, IA 52241
  

			 					
	Email:		 				 Email:
  
		
	Facsimile:		 				 Facsimile:
  
		(319) 665-2577


  
 - 8 -