Exhibit 10.1


 


EMPLOYMENT
AGREEMENT


 


This Employment Agreement
(this “Agreement”) is entered into as of December 7, 2021 (the “Effective Date”) by and between
Adial Pharmaceuticals, Inc., a Delaware corporation, (the “Company”), and Cary J. Claiborne. (the “Executive”).


 


Recitals


 


WHEREAS, the Company desires
to employ the Executive as a full-time employee of the Company and the Executive desires to accept employment with the Company upon the
terms and conditions hereinafter set forth.


 


NOW THEREFORE, in consideration
of the premises and the mutual covenants hereinafter set forth, and intending to be legally bound hereby, it is hereby agreed as follows:


 


Agreement


 


1. Definitions.


 


1.1. “Affiliate”
means as to any Person, any other Person that directly or indirectly controls, or is under common control with, or is controlled by,
such first Person. As used in this definition, “control” (including, with its correlative meanings, “controlled by”
and “under common control with”) shall mean possession, directly or indirectly, of power to direct or cause the direction
of management or policies (whether through ownership of voting equity interests, by contract or otherwise). For the avoidance of doubt,
each member of the Company Group (other than the Company) is an Affiliate of the Company.


 


1.2. “Board”
means the Board of Directors of the Company.


 


1.3. “Cause”
means the Executive’s: (i) conviction for, or entering of a plea of guilty or nolo contendere (or its equivalent under any applicable
legal system) with respect to: (A) a felony or (B) any crime involving moral turpitude; (ii) commission of fraud, misrepresentation,
embezzlement or theft against any Person; (iii) engaging in any intentional activity that injures or would reasonably be expected to
injure (monetarily or otherwise), in any material respect, the reputation, the business or a business relationship of the Company or
any of its Affiliates; (iv) gross negligence or willful misconduct in the performance of the Executive’s duties to the Company
or its Affiliates under this Agreement, or willful refusal or failure to carry out the lawful instructions of the Board that are consistent
with the Executive’s title and position; (v) violation of any fiduciary duty owed to the Company or any of its Affiliates; or (vi)
breach of any Restrictive Covenant (as defined below) or material breach or violation of any other provision of this Agreement, of a
written policy or code of conduct of the Company or any of its Affiliates (as in effect from time to time) or any other agreement between
the Executive and the Company or any of its Affiliates. Except when such acts constituting Cause which, by their nature, cannot reasonably
be expected to be cured, the Executive shall have twenty (20) days following the delivery of written notice by the Company of its intention
to terminate the Executive’s employment for Cause within which to cure any acts constituting Cause. Following such twenty (20)
day cure period, and if the reason stated in the notice is not cured, the Executive shall be given five (5) business days prior written
notice to appear (with or without counsel) before the full Board for the opportunity to present information regarding his views on the
alleged Cause event. After the Company provides the original notice of its intent to terminate Executive’s employment for Cause,
the Company may suspend the Executive, with pay, from all his duties and responsibilities and prevent him from accessing the Company’s
or its Affiliates’ premises or contacting any personnel of the Company or any of its Affiliates until a final determination on
the hearing is made. The Executive will not be terminated for Cause until a majority of the independent directors approve such termination
following the hearing.


 


1.4. “Change
of Control” means: (i) the accumulation (if over time, in any consecutive twelve (12) month period), whether directly, indirectly,
beneficially or of record, by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange
Act of 1934, as amended) of 50.1% or more of the shares of the outstanding voting securities of the Company, whether by merger, consolidation,
sale or other transfer of shares (other than a merger or consolidation where the stockholders of the Company immediately prior to the
merger or consolidation are immediately after such merger or consolidation the direct or indirect beneficial owners of a majority of
the voting securities of the entity that survives such merger or consolidation), (ii) a sale of all or substantially all of the assets
of the Company and its Subsidiaries, determined on a consolidated basis; (iii) a merger or consolidation of the Company in which its
voting securities immediately prior to the merger or consolidation do not represent, or are not converted into securities that represent,
a majority of the voting power of all voting securities of the surviving entity immediately after the merger or consolidation; or (iv)
during any period of twelve (12) consecutive months, the Continuing Directors cease for any reason to constitute at least a majority
of the Board even if one of such Continuing Directors were to resign and not be replaced by a Continuing Director; provided, however,
that the following acquisitions shall not constitute a Change of Control for the purposes of this Agreement: (A) any acquisitions of
voting securities or securities convertible, exercisable or exchangeable into voting securities directly from the Company or (B) any
acquisition of voting securities or securities convertible, exercisable or exchangeable into voting securities by any employee benefit
plan (or related trust) sponsored by or maintained by the Company or any of its Subsidiaries; provided further, that a transaction will
not be a Change of Control unless it satisfies the requirements of Treasury Regulation 1.409A-3(i)(5)(v), (vi) or (vii).


 






     


     


    

 


1.5. “Code”
means the Internal Revenue Code of 1986, as amended.


 


1.6. “Company
Group” means the Company and the direct and indirect Subsidiaries of the Company.


 


1.7. “Company
Invention” means any Invention that is Invented by the Executive (alone or jointly with others) (i) in the course of, in connection
with, or as a result of the Executive’s employment or other service with any member of the Company Group (whether before, on or
after the Effective Date), (ii) at the direction or request of any member of the Company Group, or (iii) through the use of, or that
is related to, facilities, equipment, Confidential Information, other Company Inventions, intellectual property or other resources of
any member of the Company Group, whether or not during the Executive’s work hours.


 


1.8. “Confidential
Information” shall mean all information of a sensitive, confidential or proprietary nature respecting the business and activities
of any member of the Company Group or any of their respective Affiliates, or the predecessors and successors of any member of the Company
Group or any of their respective Affiliates, including, without limitation, the terms and provisions of this Agreement (except for the
terms and provisions of Sections 4.4 through 4.17), and the clients, customers, suppliers, computer or other files, projects, products,
computer disks or other media, computer hardware or computer software programs, marketing plans, financial information, methodologies,
Inventions, know-how, research, developments, processes, practices, approaches, projections, forecasts, formats, systems, data gathering
methods and/or strategies of any member of the Company Group or any of their respective Affiliates. “Confidential Information”
also includes all information received by the Company or any other member of the Company Group under an obligation of confidentially
to a third party. Notwithstanding the foregoing, Confidential Information shall not include any information that is generally available,
or is made generally available, to the public other than as a result of a direct or indirect unauthorized disclosure by the Executive
or any other Person subject to a confidentiality obligation.


 


1.9. “Continuing
Director” means an individual who: (i) at the beginning of the preceding twelve (12) month period, was a director of the Board,
and (ii) any new director whose election by the Board or nomination for election by the Company’s stockholders was approved by
a vote of at least a majority of the directors then still in office who either were directors at the beginning of the 12-month period
or whose election or nomination for election was previously so approved.


 


1.10. “Disability”
means that the Executive has been unable, as reasonably determined by the Board (excluding the Executive) in good faith, to perform the
Executive’s duties under this Agreement for a period of ninety (90) consecutive days or for a total of one hundred and twenty (120)
days (whether or not consecutive) during any period of twelve (12) consecutive months, as a result of injury, illness or any other physical
or mental impairment.


 


1.11. “Good
Reason” means any of the following actions taken by the Company without the Executive’s prior written consent: (i) a
material reduction in the Executive’s duties, responsibilities or authority; (ii) a reduction of the Executive’s Base Salary
(defined below); (iii) failure or refusal of a successor to the Company to either materially assume the Company’s obligations under
this Agreement or enter into a new employment agreement with the Executive on terms that are materially similar to those provided under
this Agreement, in any case, in the event of a Change of Control; (iv) relocation of the Executive’s primary work location that
results in an increase in the Executive’s one-way driving distance by more than twenty-five (25) miles from the Executive’s
then-current principal residence; or (v) a material breach of this Agreement by the Company. Notwithstanding the foregoing, Good Reason
shall not be deemed to exist unless: (A) the Executive gives the Company written notice within sixty (60) days after the occurrence of
the event which the Executive believes constitutes the basis for Good Reason, specifying the particular act or failure to act which the
Executive believes constitutes the basis for Good Reason, (B) the Company fails to cure such act or failure to act within thirty (30)
days after receipt of such notice and (C) the Executive terminates his employment within thirty (30) days after the end of such thirty
(30) day cure period specified in clause (B). For the avoidance of doubt, as long as Executive is maintained as a “C-level”
officer with commensurate responsibilities and authority, change of title and responsibilities will not be Good Reason under (i) above.


 


1.12. “Invented”
means made, conceived, invented, authored, or first actually reduced to practice (in any case, whether partially or fully).


 


1.13. “Invention”
means any invention, formula, therapy, diagnostic technique, discovery, improvement, idea, technique, design, method, art, process, methodology,
algorithm, machine, development, product, service, technology, strategy, software, work of authorship or other Works (as defined in Section
4.13), trade secret, innovation, trademark, data, database, or the like, whether or not patentable, together with all intellectual property
rights therein.


 


1.14. “Person”
means an individual, partnership, limited liability company, corporation, association, joint stock company, trust, joint venture, unincorporated
organization, investment fund, any other business entity and a governmental entity or any department, agency or political subdivision
thereof.


 






    Page 2 of 21


     


    

 


1.15. “Subsidiary”
means, with respect to any Person, any other Person in which such first Person has a direct or indirect equity ownership interest of
at least 50%.


 


1.16. “Term
of Employment” means the period commencing on the date hereof and ending on the third (3rd) anniversary of Executive’s
employment under this Agreement.


 


1.17. “Termination
Date” means the date the Executive’s employment with the Company terminates for any reason.


 


2. Employment.


 


2.1. Executive’s
Representations. The Executive represents that: (i) the Executive is entering into this Agreement voluntarily and that the Executive’s
employment hereunder and compliance with the terms and conditions hereof will not conflict with or result in the breach by the Executive
of any agreement to which the Executive is a party or by which the Executive may be bound and (ii) in connection with the Executive’s
employment with the Company or any other member of the Company Group, the Executive will not: (A) violate any non-competition, non-solicitation
or other similar covenant or agreement by which the Executive is or may be bound or (B) use any confidential or proprietary information
that the Executive may have obtained in connection with the Executive’s employment or engagement with any other Person.


 


2.2. Position;
Duties and Responsibilities. During the Term of Employment, the Executive shall be employed as the Company’s Chief Operating
Officer, with such duties and responsibilities that are consistent with such position as may be assigned by the Board (excluding the
Executive) from time to time. In addition, during the Term of Employment, the Executive shall serve in such other officer and/or director
positions with any member of the Company Group (for no additional compensation) as may be determined by the Board (excluding the Executive)
from time to time. The Executive further agrees that, during the Term of Employment, he shall not knowingly take any action that is contrary
to, or in conflict with, the best interests of the Company Group.


 


2.3. Reporting;
Outside Activities. During the Term of Employment, the Executive shall report to the Chief Executive Officer, and the Executive
shall diligently and conscientiously devote the Executive’s business time, attention, energy, skill and best efforts as necessary,
but in no event less than eighty percent (80%) of his business time, to the business and affairs of the Company Group. The Executive
may also: (i) continue to serve as a member of the board of or as an advisor, consultant or employee to any organization listed in Exhibit
A hereto, (ii) serve on other boards or as an advisor as may be approved by the Board (excluding the Executive) in its sole discretion,
(iii) engage in educational, charitable and civic activities and (iv) manage the Executive’s personal and business investments
and affairs, so long as such activities: (A) do not, individually or in the aggregate, interfere with the performance of the Executive’s
duties under this Agreement and (B) are not contrary to the interests of the Company Group or competitive in any way with the Company
Group. Subject to the foregoing, during the Term of Employment, the Executive shall not, directly or indirectly, render any services
of a business, commercial, or professional nature to any other Person, whether for compensation or otherwise, without the prior written
consent of the Board (excluding the Executive), which consent shall not be unreasonably withheld.


 


3. Compensation
and Other Benefits.


 


3.1. Base
Salary. During the Term of Employment, the Executive shall initially receive an initial base salary per annum of Three Hundred
Four Thousand Dollars ($304,000), payable in cash in accordance with the Company’s normal payroll practices as in effect from time
to time. During the Term of Employment, the Board may periodically review the Executive’s base salary and the Board (excluding
the Executive) may, in its sole discretion, set such base salary to an amount it determines to be appropriate, provided, however, that
any reduction will qualify as Good Reason under Section 1.11. The Executive’s base salary, as may be in effect from time to time,
is referred to herein as “Base Salary.”


 


3.2. Annual
Bonus. During the Term of Employment, the Executive shall be eligible to earn an annual performance bonus based on the achievement
of the performance goals established by the Board or a committee thereof in its sole discretion, with an annual target bonus opportunity
of twenty-five percent (25%) of the Base Salary and the potential to earn a higher bonus for above target performance, with the amount
of any such bonus to be determined in the sole discretion of the Board or a committee thereof, in any case, excluding the Executive (the
“Annual Bonus”). Any Annual Bonus earned for any performance period may be paid in cash or any equity or equity-based
awards (or any combination thereof), as determined in the sole discretion of the Board or a committee thereof, in any case, excluding
the Executive, with such determination to be made before March 15 of the year following the year to which such Annual Bonus relates (or
such later date permitted under Section 409A (as defined below)). Any earned Annual Bonus that is payable in cash shall be paid in a
lump sum, and any earned Annual Bonus that is payable in equity or equity-based awards shall be granted, in any case, by no later than
the first March 15th to occur after the end of the applicable performance period. The Board (excluding the Executive) shall
act in good faith in determining the value of the portion of any earned Annual Bonus that will be paid in the form of equity or equity-based
awards. Except as set forth in Section 4.2, the Executive must be employed by the Company on the bonus payment date in order to receive
an earned Annual Bonus with respect to any performance period.


 


3.3. Equity
Grants. During the Term of Employment, the Executive shall be eligible for equity or equity-based awards that may be granted
to the Executive at such times, in such amounts and in such manner as the Board (excluding the Executive) may determine in its sole discretion,
but, in good faith, taking into account the roles of and responsibilities of Executive relative to industry norms for similar positions.
Any such equity or equity-based awards shall be subject to the terms and conditions set forth in the applicable plan and award agreement.




 






    Page 3 of 21


     


    

  


3.4. Expense
Reimbursement. During the Term of Employment, the Company shall reimburse the Executive’s reasonable and necessary business
expenses incurred in connection with performing the Executive’s duties hereunder in accordance with its then-prevailing policies
and procedures for expense reimbursement (which shall include appropriate itemization and substantiation of expenses incurred).


 


3.5. Benefit
Plans; Vacation. During the Term of Employment, the Executive shall be entitled to participate in all broad-based employee benefit
plans and programs maintained from time to time for the benefit of the Company’s employees (e.g., medical, dental and disability
benefits) to the extent that the Executive satisfies the eligibility requirements of such plans or programs (including, without limitation,
minimum hours worked) and subject to applicable law and the terms and conditions of such plans or programs; provided, however, that the
Company may amend, modify or terminate any such plans or programs at any time in its discretion. During the Term of Employment, the Executive
shall be entitled to twenty five (25) days of paid time off per calendar year (pro-rated for partial years), subject to the Company’s
paid time off policy, as in effect from time to time.


 


4. Termination;
Restrictive Covenants. Upon the Termination Date, the Executive shall be deemed to have immediately resigned from any and all
officer, director and other positions the Executive then holds with the Company and its Affiliates (and this Agreement shall constitute
notice of resignation by the Executive without any further action by the Executive), and the Executive agrees to execute and deliver
such further instruments as are requested by the Company in furtherance of the foregoing. Except as expressly provided in Section 4.2,
all rights the Executive may have to compensation and employee benefits from the Company or its Affiliates shall terminate immediately
upon the Termination Date. Notwithstanding the above, if Executive’s deemed resignation as a director of the Board shall not be
effective unless such resignation is accepted by the Board (excluding Executive) within thirty (30) days of the Termination Date.


 


4.1. General.
The Company may terminate the Term of Employment and the Executive’s employment at any time, with or without Cause or due to Disability,
upon written notice to the Executive. The Executive may terminate the Term of Employment and the Executive’s employment for Good
Reason or for any other reason at any time upon not less than sixty (60) days’ prior written notice to the Company; provided, that
following its receipt of the Executive’s notice of termination, the Company may elect to reduce the notice period and cause the
Termination Date to occur earlier, and action by the Company shall entitle the Executive to notice pay, severance pay or benefits or
pay in lieu of notice or lost wages or benefits. In addition, the Term of Employment and the Executive’s employment with the Company
shall terminate immediately upon the Executive’s death.


 


4.2. Separation
Payments.


 


4.2.1. General.
Except as otherwise provided in this Section 4.2, in the event that the Executive’s employment with the Company terminates for
any reason, the Executive (or the Executive’s estate or legal representative, as applicable) shall be entitled to receive only:
(i) the cash portion of the Base Salary earned but unpaid through the Termination Date, paid in accordance with the Company’s normal
payroll policies (or at such earlier time as required by applicable law), (ii) any accrued but unused vacation in accordance with the
Company’s policies and applicable law, (iii) any unreimbursed business expenses incurred prior to the Termination Date that are
otherwise reimbursable, with such expenses to be reimbursed in accordance with the Company’s expense reimbursement policies (as
may be in effect from time to time), and (iv) any vested benefits earned by the Executive under any employee benefit plan of the Company
or its Affiliates under which the Executive was participating immediately prior to the Termination Date, with such benefits to be provided
in accordance with the terms of the applicable employee benefit plan (the items described in the foregoing clauses (i) through (iv),
collectively, the “Accrued Benefits”). All other rights the Executive may have to compensation and employee benefits
from the Company or its Affiliates, other than as set forth in Sections 4.2.2 or 4.2.3, shall immediately terminate upon the Termination
Date.


 


4.2.2. Death
and Disability. In the event that the Executive’s employment is terminated due to the Executive’s death or by the
Company due to Disability, in either case, during the Term of Employment, then in addition to the Accrued Benefits, and subject to Section
4.2.4, the Executive (or the Executive’s estate or legal representative, as applicable) shall be entitled to receive: (i) the Annual
Bonus earned in the fiscal year immediately preceding the fiscal year in which such termination occurred, to the extent that such Annual
Bonus is unpaid as of the Termination Date, with such amount to be payable in cash and/or fully vested shares of the Company’s
common stock (as determined by the Company in its sole discretion) at the same time as if no such termination had occurred (the “Unpaid
Prior Year Bonus”); (ii) the Annual Bonus for the year in which the Termination Date occurs, but multiplied by a fraction (A)
the numerator of which is the number of days in the fiscal year that have transpired through the Termination Date and (B) the denominator
of which is the number of days in such fiscal year (to be paid in cash and/or fully vested shares of the Company’s common stock
(as determined by the Company in its sole discretion) at the same time as if no such termination had occurred); (iii) if the Executive
and his eligible dependents are eligible for, and timely elect COBRA continuation coverage, the Company shall reimburse the Executive
(or the Executive’s estate or legal representative, as applicable) for the COBRA premiums for the Executive and his eligible dependents
under the Company’s medical, dental and vision benefit plans for a period of 12 months following the Termination Date (the “COBRA
Benefit”); provided, however, that notwithstanding the foregoing, the COBRA Benefit shall not be provided to the extent that
it would result in any fine, penalty or tax on the Company or any of its Affiliates (under Section 105(h) of the Code or the Patient
Protection and Affordable Care Act of 2010, or otherwise); provided further, that the COBRA Benefit shall cease earlier if the Executive
or his dependents become eligible for health coverage under the health plan of another employer; and (iv) to the extent the following
will not result in a violation of Section 409A, with respect to each equity award received by Executive from the Company or any of its
direct or indirect parent companies that is outstanding as of the Termination Date, accelerated vesting immediately upon the Termination
Date of, (I) with respect to any such equity award received in payment of Base Salary or an Annual Bonus, 100% of such equity award and,
(II) with respect to any equity award not described in clause (I), the greater of (x) the portion of the unvested equity award that would
have become vested within 12 months after the Termination Date had the Executive remained employed by the Company during such 12-month
period (without regard for the vesting schedule set forth in any applicable plan or agreement governing such equity award) or (y) the
portion of the unvested equity award that is subject to accelerated vesting (if any) upon such termination under the applicable equity
plan or award agreement; provided, however, that any equity awards that are subject to the satisfaction of performance goals shall be
deemed earned at not less than target performance; and provided, further, that, with respect to any equity award that is in the form
of a stock option or stock appreciation right, the option or stock appreciation right shall remain outstanding and exercisable for 12
months following the Termination Date or, if longer, such period following the Termination Date as provided under the applicable equity
plan or award agreement (but in no event beyond the expiration date of the applicable option or stock appreciation right). All other
rights the Executive may have to compensation and employee benefits from the Company or its Affiliates, other than as set forth in this
Section 4.2.2, shall immediately terminate upon the Termination Date.


 






    Page 4 of 21


     


    

 


4.2.3. Termination
Without Cause or for Good Reason. If, during the Term of Employment, the Executive’s employment is terminated by the Company
without Cause (and not due to death or Disability) or by Executive for Good Reason, in either case, then the Executive shall be entitled
to receive the Accrued Benefits and, subject to Section 4.2.4: (i) the Unpaid Prior Year Bonus, with such amount to be payable in cash
and/or fully vested shares of the Company’s common stock (as determined by the Company in its sole discretion) at the same time
as if no such termination had occurred; (ii) the Annual Bonus for the year in which the Termination Date occurs, but multiplied by a
fraction (A) the numerator of which is the number of days in the fiscal year that have transpired through the Termination Date and (B)
the denominator of which is the number of days in such fiscal year (to be paid in cash and/or fully vested shares of the Company’s
common stock (as determined by the Company in its sole discretion) at the same time as if no such termination had occurred); (iii) continuation
of the Base Salary as of the Termination Date for six (6) months following the Termination Date, with all portions of such Base Salary
to be paid in cash in equal installments in accordance with the Company’s normal payroll policies, with the first such payment
to be made on the sixtieth (60th) day following the Termination Date and to include a catch-up covering any payroll dates
between the Termination Date and the date of the first payment, and (iv) the COBRA Benefit for a period of twelve (12) months following
the Termination Date; provided, however, that notwithstanding the foregoing, the COBRA Benefit shall not be provided to the extent that
it would result in any fine, penalty or tax on the Company or any of its Affiliates (under Section 105(h) of the Code or the Patient
Protection and Affordable Care Act of 2010, or otherwise); provided further, that the COBRA Benefit shall cease earlier if the Executive
(or his dependents) become eligible for health coverage under the health plan of another employer. All other rights the Executive may
have to compensation and employee benefits from the Company or its Affiliates, other than as set forth in this Section 4.2.3, shall immediately
terminate upon the Termination Date.


 


4.2.4. Release
Requirement. Payment and provision of the benefits set forth in Sections 4.2.2 or 4.2.3 (other than the Accrued Benefits) is
subject to the Executive’s (or, as applicable, the Executive’s estate’s or legal representative’s) execution
of a general release of claims and covenant not to sue in form and substance satisfactory to the Company, such that such release becomes
effective, with all revocation periods having expired unexercised, within sixty (60) days after the Termination Date. Notwithstanding
the foregoing, if such sixty (60) day period ends in a calendar year after the calendar year in which the Executive’s employment
terminates, then to the extent required by Section 409A, any severance payment set forth in Sections 4.2.2 or 4.2.3 (other than the Accrued
Benefits) that would have been made during the calendar year in which the Executive’s employment terminates instead shall be withheld
and paid on the first payroll date in the calendar year after the calendar year in which the Executive’s employment terminates,
with all remaining payments to be made as if no such delay had occurred.


 


4.3. Violation
of Restrictive Covenants. Without limiting the remedies provided to the Company and its Affiliates as set forth in this Article
4, upon the Executive’s breach of any of the Restrictive Covenants (as defined below), other than any immaterial and unintentional
breach by the Executive of the confidentiality obligations set forth in Section 4.11, the Company will have no obligation to continue
to pay or provide any of the compensation or benefits under Section 4.2 (other than the Accrued Benefits) and the Executive shall repay
to the Company any amounts paid under Section 4.2 (other than the Accrued Benefits) after such breach occurred.


 


4.4. Restrictive
Covenants. As an inducement and as essential consideration for the Company to enter into this Agreement, and in exchange for
other good and valuable consideration, the Executive hereby agrees to the restrictive covenants contained in Sections 4.5 through 4.17
(the “Restrictive Covenants”). The Company and the Executive agree that the Restrictive Covenants are essential and
narrowly tailored to preserve the goodwill of the business of the Company and its Affiliates, to maintain the confidential and trade
secret information of the Company and its Affiliates, and to protect other legitimate business interests of the Company and its Affiliates,
and that the Company would not have entered into this Agreement without the Executive’s agreement to the Restrictive Covenants.
For purposes of the Restrictive Covenants, each reference to “Company,” “Company Group” and “Affiliate,”
shall also refer to the predecessors and successors of the Company, the members of the Company Group and any of their Affiliates (as
the case may be).


 


4.5. Non-Competition.
During the period commencing on the Effective Date and ending twenty four (24) months after the Termination Date (the “Restrictive
Period”), regardless of the reason for Executive’s termination of employment, the Executive shall not, in any state of the
United States or European Union where the Company conducts business as of the Termination Date, engage in, or own, manage, operate or
control, or participate in the ownership, management, operation or control of any business or entity that develops, sells or provides
products or services competitive with the products or services developed, sold or provided by any member of the Company Group at the
time of cessation of the employment of Executive. Notwithstanding the foregoing, nothing in this Section 4.5 shall prevent the Executive
from owning, as a passive investor, up to five percent (5%) of the securities of any entity that are publicly traded on a national securities
exchange. For the avoidance of doubt, nothing in this Section 4.5 prevents the Executive from working in the pharmaceutical industry
as long as such positions and activities are not competitive with the business of the Company Group. As used in this Section 4.5, “competitive”
shall mean products or services using the same mechanism of action or for the treatment of the same (or substantially similar) indication.
Executive agrees that this covenant is reasonable with respect to its duration, geographical area, and scope.


 


4.6. Customer
Non-Solicitation. During the period commencing on the Effective Date and ending twelve (12) months after the Termination Date,
regardless of the reason for Executive’s termination of employment, the Executive shall not (except on the Company’s behalf
during the Executive’s employment with the Company), for purposes of providing products or services that are competitive with those
provided by any member of the Company Group, on the Executive’s own behalf or on behalf of any other Person, solicit any customer
or client of any member of the Company Group with whom the Executive had contact, solicited, or served within the twelve (12) months
prior to the Termination Date.


 






    Page 5 of 21


     


    

 


4.7. Customer
Non-Acceptance. During the period commencing on the Effective Date and ending twelve (12) months after the Termination Date,
regardless of the reason for Executive’s termination of employment, the Executive shall not (except on the Company’s behalf
during the Executive’s employment with the Company), for purposes of providing products or services that are competitive with those
provided by any member of the Company Group, on the Executive’s own behalf or on behalf of any other Person, accept business from
any customer or client of any member of the Company Group with whom the Executive had contact, solicited, or served within the twelve
(12) months prior to the Termination Date.


 


4.8. Employee
and Independent Contractor Non-Solicitation. During the period commencing on the Effective Date and ending twelve (12) months
after the Termination Date, regardless of the reason for Executive’s termination of employment, the Executive shall not (except
on the Company’s behalf during the Term of Employment), on the Executive’s own behalf or on behalf of any other Person, solicit
for employment or engagement any individual who: (A) is employed by, or an independent contractor of, any member of the Company Group
at the time of such solicitation or (B) was employed by, or an independent contractor of, any member of the Company Group within twelve
(12) months prior to such solicitation.


 


4.9. Employee
and Independent Contractor Non-Acceptance. During the period commencing on the Effective Date and ending twenty four (24) months
after the Termination Date, regardless of the reason for Executive’s termination of employment, the Executive shall not (except
on the Company’s behalf during the Term of Employment), on the Executive’s own behalf or on behalf of any other Person, employ
or engage any individual who (A) is employed by, or an independent contractor of, any member of the Company Group at the time of such
employment or engagement or (B) was employed by, or an independent contractor of, any member of the Company Group within twelve (12)
months prior to such employment or engagement.


 


4.10. Non-Disparagement.
During the Term of Employment and at all times thereafter, neither the Company nor the Executive shall not, directly or through any other
Person make any public or private statements (whether orally, in writing, via electronic transmission, or otherwise) that disparage,
denigrate or malign the other party or any of the Company’s respective businesses, products, services, activities, operations,
affairs, reputations or prospects; or any of the Company’s respective officers, employees, directors, partners (general and limited),
agents, members or shareholders. For purposes of clarification, and not limitation, a statement shall be deemed to disparage, denigrate
or malign the other party if such statement could be reasonably construed to adversely affect the opinion any other Person may have or
form of such first Person. The foregoing limitations shall not be violated by truthful statements made by the Executive or the Company:
(i) to any governmental authority or (ii) which are in response to legal process, required governmental testimony or filings, or administrative
or arbitral proceedings (including, without limitation, depositions in connection with such proceedings).


 


4.11. Confidentiality;
Return of Property. During the Term of Employment and for a period of seven (7) years thereafter, the Executive shall not, without
the prior express written consent of the Company, directly or indirectly, use on the Executive’s behalf or on behalf of any other
Person, or divulge, disclose or make available or accessible to any Person, any Confidential Information, other than when required to
do so in good faith to perform the Executive’s duties and responsibilities hereunder while employed by any member of the Company
Group, when required to do so by a lawful order of a court of competent jurisdiction, any governmental authority or agency, or any recognized
subpoena power, or in connection with reporting possible violations of federal law or regulation to any governmental agency or entity,
or making other disclosures that are protected under the whistleblower provisions of federal law or regulation. In the event that the
Executive becomes legally compelled (by oral questions, interrogatories, request for information or documents, subpoena, criminal or
civil investigative demand or similar process) to disclose any Confidential Information, then prior to such disclosure, the Executive
will provide the Board with prompt written notice so that the Company may seek (with the Executive’s cooperation) a protective
order or other appropriate remedy and/or waive compliance with the provisions of this Agreement. In the event that such protective order
or other remedy is not obtained, then the Executive will furnish only that portion of the Confidential Information which is legally required,
and will cooperate with the Company in the Company’s efforts to obtain reliable assurance that confidential treatment will be accorded
to the Confidential Information. In addition, the Executive shall not create any derivative work or other product based on or resulting
from any Confidential Information (except in the good faith performance of the Executive’s duties under this Agreement while employed
by any member of the Company Group). The Executive shall also proffer to the Board’s designee, no later than the Termination Date
(or upon the earlier request of the Company), and without retaining any copies, notes or excerpts thereof, all property of the Company
and its Affiliates, including, without limitation, memoranda, computer disks or other media, computer programs, diaries, notes, records,
data, customer or client lists, marketing plans and strategies, and any other documents consisting of or containing Confidential Information,
that are in the Executive’s actual or constructive possession or which are subject to the Executive’s control at such time.
To the extent the Executive has retained any such property or Confidential Information on any electronic or computer equipment belonging
to the Executive or under the Executive’s control, the Executive agrees to so advise Company and to follow Company’s instructions
in permanently deleting all such property or Confidential Information and all copies. Notwithstanding the foregoing, in accordance with
the Defend Trade Secrets Act of 2016, the Executive shall not be held criminally or civilly liable under any federal or state trade secret
law for the disclosure of a trade secret that: (a) is made (I) in confidence to a federal, state, or local government official, either
directly or indirectly, or to an attorney, and (II) solely for the purpose of reporting or investigating a suspected violation of law;
or (b) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal.


 






    Page 6 of 21


     


    

 


4.12. Ownership
of Inventions. The Executive acknowledges and agrees that all Company Inventions (including all intellectual property rights
arising therein or thereto, all rights of priority relating to patents, and all claims for past, present and future infringement, misappropriation
relating thereto), and all Confidential Information, hereby are and shall be the sole and exclusive property of the Company (collectively,
the “Company IP”). The Executive further acknowledges and agrees that any rights arising in the Executive in any Invention
Invented by the Executive, whether alone or jointly with others, during the twelve (12) months following the Termination Date and relating
in any way to work performed by the Executive for any member of the Company Group during the Executive’s employment with or service
for any member of the Company Group (“Post-employment Inventions”), shall hereby be deemed to be Company Inventions
and the sole and exclusive property of the Company; provided, however, that the Board (excluding the Executive) in its sole discretion
may elect to compensate the Executive for any Post-employment Inventions. For consideration acknowledged and received, the Executive
hereby irrevocably assigns, conveys and sets over to the Company all of the Executive’s right, title and interest in and to all
Company IP. The Executive acknowledges and agrees that the compensation received by the Executive for employment or services provided
to the Company is adequate consideration for the foregoing assignment. The Executive further agrees to disclose in writing to the Board
any Company Inventions (including, without limitation, all Post-employment Inventions), promptly following their conception or reduction
to practice. Such disclosure shall be sufficiently complete in technical detail and appropriately illustrated by sketch or diagram to
convey to one skilled in the art of which the Company Invention pertains, a clear understanding of the nature, purpose, operations, and
other characteristics of the Company Invention. The Executive agrees to execute and deliver such deeds of assignment or other documents
of conveyance and transfer as the Company may request to confirm in the Company or its designee the ownership of the Company Inventions,
without compensation beyond that provided in this Agreement. The Executive further agrees, upon the request of the Company and at its
expense, that the Executive will execute any other instrument and document necessary or desirable in applying for and obtaining patents
in the United States and in any foreign country with respect to any Company Invention. The Executive further agrees, whether or not the
Executive is then an employee or other service provider of any member of the Company Group, upon request of the Company, to provide reasonable
assistance, at the Company’s sole expense, with respect to the perfection, recordation or other documentation of the assignment
of Company IP hereunder, and the enforcement of the Company’s rights in any Company IP, and to cooperate to the extent and in the
manner reasonably requested by the Company, subject to the Executive’s then schedule, in any litigation or other claim or proceeding
(including, without limitation, the prosecution or defense of any claim involving a patent) involving any Company IP covered by this
Agreement, with compensation at the Executive’s customary hourly rate, together with all reasonable out-of-pocket expenses incurred
by the Executive in satisfying the requirements of this Section 4.12 shall be paid by the Company or its designee. The Executive shall
not, on or after the date of this Agreement, directly or indirectly challenge the validity or enforceability of the Company’s ownership
of, or rights with respect to, any Company IP, including, without limitation, any patent issued on, or patent application filed in respect
of, any Company Invention.


 


4.13. Works
for Hire. The Executive also acknowledges and agrees that all works of authorship, in any format or medium, and whether published
or unpublished, created wholly or in part by the Executive, whether alone or jointly with others: (i) in the course of, in connection
with, or as a result of the Executive’s employment or other service with any member of the Company Group (whether before or after
the Effective Date), (ii) at the direction or request of any member of the Company Group, or (iii) through the use of, or that is related
to, facilities, equipment, Confidential Information, other Company Inventions, intellectual property or other resources of any member
of the Company Group, whether or not during the Executive’s work hours (“Works”), are works made for hire as
defined under United States copyright law, and that the Works (and all copyrights arising in the Works) are owned exclusively by the
Company and all rights therein will automatically vest in the Company without the need for any further action by any party. To the extent
any such Works are not deemed to be works made for hire, for consideration acknowledged and received, the Executive hereby waives any
“moral rights” in such Works and the Executive hereby irrevocably assigns, transfers, conveys and sets over to the Company
or its designee, without compensation beyond that provided in this Agreement, all right, title and interest in and to such Works, including
without limitation all rights of copyright arising therein or thereto, and further agrees to execute such assignments or other deeds
of conveyance and transfer as the Company may request to vest in the Company or its designee all right, title and interest in and to
such Works, including all rights of copyright arising in or related to the Works.


 


4.14. Cooperation.
During and after the Term of Employment, the Executive agrees to cooperate with the Company Group in any internal investigation, any
administrative, regulatory, or judicial proceeding or any dispute with a third party concerning issues about which the Executive has
knowledge or that may relate to the Executive or the Executive’s employment with the Company. The Executive’s obligation
to cooperate hereunder includes, without limitation, being available to the Company Group upon reasonable notice for interviews and factual
investigations, appearing in any forum at the Company Group’s request to give testimony (without requiring service of a subpoena
or other legal process), volunteering to the Company Group pertinent information, and turning over to the Company Group all relevant
documents which are or may come into the Executive’s possession. The Company shall promptly compensate the Executive at his usual
and customary hourly rate, plus reimburse the Executive for the reasonable out of pocket expenses incurred by the Executive in connection
with such cooperation.


 






    Page 7 of 21


     


    

 


4.15. Injunctive
Relief. The Executive acknowledges and agrees that the Company and its Affiliates will have no adequate remedy at law and would
be irreparably harmed if the Executive breaches or threatens to breach any of the Restrictive Covenants. The Executive agrees that the
Company and its Affiliates shall be entitled to equitable and/or injunctive relief to prevent any breach or threatened breach of any
of the Restrictive Covenants, and to specific performance of each of the terms thereof, in each case, in addition to any other legal
or equitable remedies that the Company and its Affiliates may have, as well as the costs and reasonable attorneys’ fees it/they
incur in enforcing any of the Restrictive Covenants. The Executive further agrees that: (i) any breach or claimed breach of the provisions
set forth in this Agreement by, or any other claim the Executive may have against, the Company or any of its Affiliates will not be a
defense to enforcement of any Restrictive Covenant and (ii) the circumstances of the Executive’s termination of employment with
the Company will have no impact on the Executive’s obligations to comply with any Restrictive Covenant. The Restrictive Covenants
are intended for the benefit of the Company and each of its Affiliates. Each Affiliate of the Company is an intended third party beneficiary
of the Restrictive Covenants, and each Affiliate of the Company, as well as any successor or assign of the Company or such Affiliate,
may enforce the Restrictive Covenants. The Executive further agrees that the Restrictive Covenants are in addition to, and not in lieu
of, any non-competition, non-solicitation, protection of confidential information or intellectual property, or other similar covenants
in favor of the Company or any of its Affiliates by which the Executive may be bound.


 


4.16. Tolling
During Periods of Breach. The parties hereto agree and intend that the Restrictive Covenants (to the extent not perpetual) be
tolled during any period that the Executive is in breach of any such Restrictive Covenant, with such tolling to cease with respect to
a Restrictive Covenant once the Executive is in compliance with such Restrictive Covenant, so that the Company and its Affiliates are
provided with the full benefit of the restrictive periods set forth herein.


 


4.17. Notification
of New Employer. In the event that the Executive is employed or otherwise engaged by any other Person following the Termination
Date and during the Restrictive Period, the Executive agrees to notify, and consents to the notification by Company and its Affiliates
of, such Person of the Restrictive Covenants.


 


5. Miscellaneous.


 


5.1. Applicable
Law. This Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Virginia, applied without
reference to principles of conflicts of law.


 


5.2. Mediation.
Any controversy, dispute or claim arising out of or relating to this Agreement, Executive’s employment or service with any member
of the Company Group or the termination thereof shall, if not settled by direct negotiation between the parties, be subject to non-binding
mediation under the Employment Arbitration Rules and Mediation Procedures of the American Arbitration Association (“AAA”)
as in effect on the date of the notice of demand for mediation. Any demand for mediation by either party shall be made in writing and
served upon the other party and shall set forth with reasonable specificity the basis of the dispute and the relief sought. Any mediation
hereunder shall be conducted before an independent mediator mutually selected by the parties. If the parties are unable to agree to a
mediator within ten (10) days after the receipt of a demand for mediation by either party, the mediator will be chosen by alternatively
striking from a list of five mediators obtained by the Company from AAA, and the Executive shall have the first strike. The mediation
hearing will occur at a time and place convenient to the parties in the Commonwealth of Virginia. Notwithstanding the foregoing, any
claims under Section 4.15 are exempt from this Section 5.2 and may be brought in any court of competent jurisdiction without mediation.


 


5.3. Venue;
WAIVER OF JURY TRIAL. In the event that any controversy, dispute or claim arising out of or relating to this Agreement, Executive’s
employment or service with any member of the Company Group or the termination thereof is not settled through mediation pursuant to Section
5.2, both the Executive and the Company agree to appear before and submit exclusively to the jurisdiction of the federal courts located
in Charlottesville, Virginia with respect to such controversy, dispute or claim (or if such controversy, dispute or claim may not be
brought in federal court, the state courts located in Charlottesville, Virginia). Both the Executive and the Company also agree to waive,
to the fullest possible extent, the defense of an inconvenient forum or lack of jurisdiction. THE COMPANY AND THE EXECUTIVE HEREBY
WAIVE, TO THE EXTENT PERMITTED BY APPLICABLE LAW, TRIAL BY JURY IN ANY LITIGATION IN ANY COURT WITH RESPECT TO, IN CONNECTION WITH, OR
ARISING OUT OF THE EXECUTIVE’S EMPLOYMENT BY, OR SERVICE WITH, ANY MEMBER OF THE COMPANY GROUP OR THE TERMINATION THEREOF, OR THIS
AGREEMENT OR THE VALIDITY, PROTECTION, INTERPRETATION, COLLECTION OR ENFORCEMENT THEREOF (WHETHER ARISING IN CONTRACT, EQUITY, TORT OR
OTHERWISE).


 


5.4. Amendments.
This Agreement may not be amended or modified otherwise than by a written agreement executed by the parties hereto or their respective
successors and legal representatives.


 






    Page 8 of 21


     


    

 


5.5. Notices.
All notices and other communications hereunder shall be in writing, and shall be given by hand-delivery to the other party, by reputable
overnight courier, or by registered or certified mail, return receipt requested, postage prepaid, addressed as follows:


 


	 	To the Company: 	Adial Pharmaceuticals, Inc.

    1180 Seminole Trail, Suite 495

    Charlottesville, VA 22901

    Attention: Chief Executive Officer

	 	 	 
	 	With a copy (which copy shall not constitute
    notice) to:	Gracin & Marlow, LLP

    Chrysler Building

    405 Lexington Avenue

    26th Floor

    New York, New York 10174

    Attention: Leslie Marlow

	 	 	 
	 	To the Executive:	at the residence address most recently filed
    with the Company; 


 


or to such other address as any party shall have furnished to the
other in writing in accordance herewith. All such notices shall be deemed to have been duly given: (i) when delivered personally to the
recipient, (ii) one (1) business day after being sent to the recipient by reputable overnight courier service (charges prepaid); or (iii)
four (4) business days after being mailed to the recipient by certified or registered mail, return receipt requested and postage prepaid.


 


5.6. Indemnification.
The Parties agree to enter the Indemnification Agreement attached at Exhibit B hereto.


 


5.7. Withholding.
The Company may withhold from any amounts payable under this Agreement such federal, state or local income taxes as are required to be
withheld pursuant to any applicable law or regulation.


 


5.8. Code
Section 409A Compliance.


 


5.8.1. The
provisions of this Agreement are intended to comply with Section 409A of the Code and any final regulations and guidance promulgated
thereunder (“Section 409A”) or an exemption thereunder and shall be construed in a manner consistent with the requirements
for avoiding taxes or penalties under Section 409A. The Company and Executive agree to work together in good faith to consider amendments
to this Agreement and to take such reasonable actions which are necessary, appropriate or desirable to avoid imposition of any additional
tax or income recognition prior to actual payment or provision of benefit to Executive under Section 409A.


 


5.8.2. To
the extent that Executive will be reimbursed for costs and expenses or in-kind benefits, except as otherwise permitted by Section 409A,
(a) the right to reimbursement or in-kind benefits is not subject to liquidation or exchange for another benefit, (b) the amount of expenses
eligible for reimbursement, or in-kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement,
or in-kind benefits to be provided, in any other taxable year; provided that the foregoing clause (b) shall not be violated with
regard to expenses reimbursed under any arrangement covered by Section 105(b) of the Code solely because such expenses are subject to
a limit related to the period the arrangement is in effect and (c) such payments shall be made on or before the last day of the taxable
year following the taxable year in which Executive incurred the expense.


 


5.8.3. A
termination of employment shall not be deemed to have occurred for purposes of any provision of this Agreement providing for the payment
of any amounts or benefits upon or following a termination of employment unless such termination constitutes a “Separation from
Service” within the meaning of Section 409A and, for purposes of any such provision of this Agreement references to a “termination,”
“termination of employment” or like terms shall mean Separation from Service.


 


5.8.4. Any
payments under this Agreement that may be excluded from Section 409A either as separation pay due to an involuntary separation from service
or as a short-term deferral shall be excluded from Section 409A to the maximum extent possible. Each installment payable hereunder shall
constitute a separate payment for purposes of Treasury Regulation Section 1.409A-2(b), including Treasury Regulation Section 1.409A-2(b)(2)(iii).
Each payment that is made within the terms of the “short-term deferral” rule set forth in Treasury Regulation Section 1.409A-1(b)(4)
is intended to meet the “short-term deferral” rule. Each other payment is intended to be a payment upon an involuntary termination
from service and payable pursuant to Treasury Regulation Section 1.409A-1(b)(9)(iii), et. seq., to the maximum extent permitted by that
regulation, with any amount that is not exempt from Section 409A being subject to Section 409A.


 


5.8.5. Notwithstanding
anything to the contrary in this Agreement, if Executive is a “specified employee” within the meaning of Section 409A at
the time of Executive’s termination, then only that portion of the severance and benefits payable to Executive pursuant to this
Agreement, if any, and any other severance payments or separation benefits which may be considered deferred compensation under Section
409A that is payable on account of the Executive’s termination (other than by reason of death) (together, the “Deferred
Compensation Separation Benefits”) that are due to Executive on or within the six (6) month period following Executive’s
termination will accrue during such six (6) month period and will become payable in one lump sum cash payment on the date that is six
(6) months and one (1) day following the date of Executive’s termination of employment. All subsequent Deferred Compensation Separation
Benefits, if any, will be payable in accordance with the payment schedule applicable to each payment or benefit. Notwithstanding anything
herein to the contrary, if Executive dies following termination but prior to the six (6) month anniversary of Executive’s termination
date, then any payments delayed in accordance with this paragraph will be payable in a lump sum as soon as administratively practicable
after the date of Executive’s death (but not earlier than such payment would have been made absent such death) and all other Deferred
Compensation Separation Benefits will be payable in accordance with the payment schedule applicable to each payment or benefit.


 






    Page 9 of 21


     


    

 


5.8.6. Notwithstanding
anything herein to the contrary, neither the Company nor any of its Affiliates shall have any liability to the Executive or to any other
Person if the payments and benefits provided in this Agreement that are intended to be exempt from or compliant with Section 409A are
not so exempt or compliant.


 


5.9. Excess
Parachute Payments under Code Section 280G. Notwithstanding any other provisions of this Agreement, if any “payments”
(including, without limitation, any benefits or transfers of property or the acceleration of the vesting of any benefits) in the nature
of compensation under any arrangement that is considered contingent on a Change of Control for purposes of Section 280G of the Code,
together with any other payments that the Executive has the right to receive from the Company or any corporation that is a member of
an “affiliated group” (as defined in Section 1504(a) of the Code without regard to Section 1504(b) of the Code) of which
the Company is a member or from any other Person, would constitute a “parachute payment” (as defined in Section 280G(b)(2)
of the Code), such “payments” may, at the Executive’s sole election, be reduced to the largest amount that will result
in no portion of such “payments” being subject to the excise tax imposed by Section 4999 of the Code. Any such reduction
in “payments” shall be applied first against the latest scheduled cash payments; then current cash payments; then any equity
or equity derivatives that are included under Section 280G of the Code at full value rather than accelerated value (with the highest
value reduced first); then any equity or equity derivatives included under Section 280G of the Code at an accelerated value (and not
at full value), with the highest value reduced first (as such values are determined under Treasury Regulation Section 1.280G-1, Q&A
24); and finally any other non-cash benefits will be reduced (in the order of latest scheduled payments to earliest scheduled payments).
All calculations hereunder shall be performed by a nationally recognized independent accounting firm selected by the Company, with the
full cost of such firm being borne by the Company. Any determinations made by such firm shall be final and binding on the Executive and
the Company.


 


5.10. Severability.
The terms and provisions of this Agreement are intended to be separate and divisible provisions and if, for any reason, any one or more
of them is held to be invalid or unenforceable, neither the validity nor the enforceability of any other provision of this Agreement
shall thereby be affected. It is the intention of the parties to this Agreement that the Restrictive Covenants be reasonable in duration,
geographic scope and in all other respects. The Executive agrees that the Restrictive Covenants, including, without limitation, the duration,
geographic scope and activity restrictions of each restriction, are reasonable in light of the Executive’s senior position. However,
if for any reason any court of competent jurisdiction shall find any provisions of the Restrictive Covenants unreasonable in duration
or geographic scope or otherwise, it is the intention of the parties that the restrictions and prohibitions contained therein shall be
modified by the court to be effective to the fullest extent allowed under applicable law in such jurisdiction.


 


5.11. Captions.
The captions of this Agreement are not part of the provisions hereof and shall have no force or effect.


 


5.12. Counterparts.
This Agreement may be executed in counterparts and delivered by facsimile transmission or electronic transmission in “portable
document format,” each of which shall be an original and which taken together shall constitute one and the same document.


 


5.13. Entire
Agreement. This Agreement contains the entire agreement concerning the subject matter hereof and supersedes all prior agreements,
understandings, discussions, negotiations and undertakings, whether written or oral, between the parties and their Affiliates relating
to such subject matter.


 


5.14. Survivorship.
The provisions of Article 1, Article 5, Section 2.1 and Sections 4.4 through 4.17 shall survive the termination of the Executive’s
employment with the Company and this Agreement in accordance with their terms.


 


5.15. Successors
and Assigns. The Company may assign, without the Executive’s consent, its rights and/or delegate its obligations under
this Agreement to any successor of the Company, whether by operation of law, agreement or otherwise (including, without limitation, any
Person who acquires all or a substantial portion of the business of the Company Group (whether direct or indirect and whether structured
as a stock sale, asset sale, merger, recapitalization, consolidation or other transaction)) and, in connection with any such delegation
of its obligations hereunder (but only so long as such assignee or delegee has consented in writing to be bound by the obligations hereunder)
shall be released from such obligations hereunder. This Agreement may not be assigned by the Executive. Except as otherwise provided
herein, this Agreement shall bind and inure to the benefit of and be enforceable by the Executive, the Company and their respective successors
and permitted assigns.


 


[signatures to follow on next page]


 






    Page 10 of 21


     


    

 


IN WITNESS WHEREOF, the Executive has hereunto
set the Executive’s hand and the Company has caused this Agreement to be executed in its name on its behalf, all as of the day
and year first above written.


 


	ADIAL PHARMACEUTICALS, INC.  	 	EXECUTIVE:
	 	 	 
	
    By: 
	/s/ William B.
    Stilley, III 	 	/s/ Cary J. Claiborne
    
	Name:	
    William B. Stilley, III 
	 	
    Cary J. Claiborne 

	Title:	Chief Executive Officer	 	 



 






    Page 11 of 21


     


    

 


Exhibit A


Board, Advisory, Consultant, Employee Positions


 


	Adial Pharmaceuticals	Board
	NeuroSense Therapeutics Ltd. (or alternate if IPO does not Close) 	Board Nominee
	CytRx Corporation (or Alternate) 	Board Nominee
	Prosperity Capital Management, LLC	Owner
	Abide Family Blessings. LLC	Advisor (Spouse’s business)



 






    Page 12 of 21


     


    

 


Exhibit B


Indemnification Agreement


 


[See attached]





 






    Page 13 of 21


     


    

 


INDEMNIFICATION AGREEMENT


 


This Indemnification Agreement
(the “Agreement”) is made and entered into this 7th day of December, 2021, by and between Adial Pharmaceuticals
Inc., a Delaware corporation (the “Company”, which term shall include, where appropriate, any Entity (as hereinafter
defined) controlled directly or indirectly by the Company), and Cary J. Claiborne (the “Indemnitee”).


 


WHEREAS, it is essential
to the Company that it be able to retain and attract as directors and officers the most capable persons available;


 


WHEREAS, increased corporate
litigation has subjected directors and officers to litigation risks and expenses, and the limitations on the availability of directors
and officers liability insurance have made it increasingly difficult for the Company to attract and retain such persons;


 


WHEREAS, the Company’s
Certificate of Incorporation, as amended, and Bylaws (the “Certificate” and the “Bylaws”,
respectively), provide that the Company is authorized to indemnify its directors and officers to the fullest extent permissible by applicable
law and permit it to make other indemnification arrangements and agreements;


 


WHEREAS, the Company desires
to provide Indemnitee with specific contractual assurance of Indemnitee’s rights to full indemnification against litigation risks
and expenses (regardless, among other things, of any amendment to or revocation of the Certificate or Bylaws or any change in the ownership
of the Company or the composition of its board of directors (the “Board of Directors”));


 


WHEREAS, the Company intends
that this Agreement provide Indemnitee with greater protection than that which is provided by the Certificate and Bylaws; and


 


WHEREAS, Indemnitee is relying
upon the rights afforded under this Agreement in becoming or continuing as a director and/or officer of the Company.


 


NOW, THEREFORE, in consideration
of the promises and the covenants contained herein, the Company and Indemnitee do hereby covenant and agree as follows:


 


 1. Definitions.




 


(a) “Corporate
Status” describes the status of a person who is serving or has served (i) as a director and/or officer of the Company,
(ii) in any capacity with respect to any employee benefit plan of the Company or (at the request of the Company) any employee benefit
plan of any other Entity, or (iii) as a director and/or officer of any other Entity at the request of the Company. For purposes of subsections
(ii) and (iii) of this Section 1(a), if Indemnitee is serving or has served as a director and/or officer of a Subsidiary (as defined
below), or in any capacity with respect to any employee benefit plan of a Subsidiary, Indemnitee shall be deemed to be serving at the
request of the Company. If Indemnitee is an employee of the Company, Corporate Status shall not include actions taken by Indemnitee in
any capacity other than as a director and/or officer or as a representative of any employee benefit plan.


 


(b) “Entity”
shall mean any corporation, partnership, limited liability company, joint venture, trust, foundation, association, organization or other
legal entity.


 


(c) “Expenses”
shall mean all fees, costs and expenses incurred by Indemnitee in connection with any Proceeding (as defined below), including, without
limitation, reasonable attorneys’ fees, disbursements and retainers (including, without limitation, any such fees, disbursements
and retainers incurred by Indemnitee pursuant to Sections 11 and 12(c) of this Agreement), fees and disbursements of expert witnesses,
private investigators and professional advisors (including, without limitation, accountants and investment bankers), court costs, transcript
costs, fees of experts, travel expenses, duplicating, printing and binding costs, telephone and fax transmission charges, postage, delivery
services, secretarial services and other disbursements and expenses.


 






    Page 14 of 21


     


    

 


(d) “Indemnifiable
Expenses”, “Indemnifiable Liabilities” and “Indemnifiable Amounts”
shall have the meanings ascribed to those terms in Section 3(a) below.


 


(e) “Liabilities”
shall mean judgments, damages, liabilities, losses, penalties, excise taxes, fines and amounts paid in settlement.


 


(f) “Proceeding”
shall mean any threatened, pending or completed claim, action, suit, arbitration, alternate dispute resolution process, investigation,
administrative hearing, appeal or any other proceeding, whether civil, criminal, administrative, arbitrative or investigative, whether
formal or informal, including a proceeding initiated by Indemnitee pursuant to Section 11 of this Agreement to enforce Indemnitee’s
rights hereunder.


 


(g) “Subsidiary”
shall mean any corporation, partnership, limited liability company, joint venture, trust or other Entity of which the Company owns (either
directly or through or together with another Subsidiary of the Company) either (i) a general partner, managing member or other similar
interest or (ii) (A) 50% or more of the voting power of the voting capital equity interests of such corporation, partnership, limited
liability company, joint venture or other Entity or (B) 50% or more of the outstanding voting capital stock or other voting equity interests
of such corporation, partnership, limited liability company, joint venture or other Entity.


 


(h) “to
the fullest extent permissible by applicable law” shall include, but not be limited to: (i) the fullest extent permitted
by the provisions of the General Corporation Law of the State of Delaware (the “DGCL”) that authorize or contemplate
additional or supplementary indemnification by agreement, or the corresponding provisions of any amendment to or replacement of the DGCL
or such provisions thereof; and (ii) the fullest extent authorized or permitted by any amendments to or replacements of the DGCL adopted
after the date of this Agreement that increase the extent to which a corporation may indemnify its directors and/or officers.


 


2. Services
of Indemnitee. In consideration of the Company’s covenants and commitments hereunder, Indemnitee agrees to serve or continue
to serve as a director and/or officer of the Company. However, this Agreement shall not impose any obligation on Indemnitee or the Company
to continue Indemnitee’s service to the Company beyond any period otherwise required by law or by other agreements or commitments
of the parties, if any.


 


3. Agreement
to Indemnify. The Company agrees to hold harmless and indemnify Indemnitee to the fullest extent permissible by applicable law as
follows:


 


(a) Proceedings.
Subject to the exceptions contained in Section 4(a) below, if Indemnitee was or is a party or is threatened to be made a party to any
Proceeding by reason of Indemnitee’s Corporate Status, Indemnitee shall be indemnified by the Company against all Expenses and
Liabilities actually and reasonably incurred or paid by Indemnitee in connection with such Proceeding (referred to herein as “Indemnifiable
Expenses “and “Indemnifiable Liabilities”, respectively, and collectively as “Indemnifiable
Amounts”).


 


(b) Conclusive
Presumption Regarding Standard of Care. In making any determination required to be made under Delaware law with respect to entitlement
to indemnification hereunder, the person, persons or entity making such determination shall presume that Indemnitee is entitled to indemnification
under this Agreement if Indemnitee submitted a request therefor in accordance with Section 5 of this Agreement, and the Company shall
have the burden of proof to overcome that presumption in connection with the making by any person, persons or Entity of any determination
contrary to that presumption.


 






    Page 15 of 21


     


    

 


4. Exceptions
to Indemnification. Subject to Section 20 below, Indemnitee shall be entitled to indemnification under Section 3(a) above in all
circumstances and with respect to each and every specific claim, issue or matter involved in the Proceeding out of which Indemnitee’s
claim for indemnification has arisen to the fullest extent permissible by applicable law, except as follows:


 


(a) Proceedings.
If indemnification is requested under Section 3(a) and it has been finally adjudicated by a court of competent jurisdiction that, in
connection with such specific claim, issue or matter, Indemnitee failed to act (i) in good faith and (ii) in a manner Indemnitee reasonably
believed to be in or not opposed to the best interests of the Company, or, with respect to any criminal Proceeding, Indemnitee had reasonable
cause to believe that Indemnitee’s conduct was unlawful, Indemnitee shall not be entitled to payment of Indemnifiable Amounts hereunder
to the extent that they arise out of such claim, issue or matter.


 


(b) Insurance
Proceeds. To the extent payment is actually made to the Indemnitee under a valid and collectible insurance policy maintained at the
expense of the Company in respect of Indemnifiable Amounts in connection with such specific claim, issue or matter, Indemnitee shall
not be entitled to payment of Indemnifiable Amounts hereunder except in respect of any excess of such Indemnifiable Amounts beyond the
amount of payment under such insurance.


 


5. Procedure
for Payment of Indemnifiable Amounts. Indemnitee shall submit to the Company a written request specifying the Indemnifiable Amounts
for which Indemnitee seeks payment under Section 3 of this Agreement and the basis for the claim. The Company shall pay such Indemnifiable
Amounts to Indemnitee promptly, but in no event later than thirty (30) calendar days after receipt of such request. At the request of
the Company, Indemnitee shall furnish such documentation and information as are reasonably available to Indemnitee and necessary to establish
that Indemnitee is entitled to indemnification hereunder.


 


6. Indemnification
for Expenses of a Party Who is Wholly or Partly Successful. Notwithstanding any other provision of this Agreement, and without limiting
any such provision, to the extent that Indemnitee is, by reason of Indemnitee’s Corporate Status, a party to and is successful,
on the merits or otherwise, in any Proceeding, Indemnitee shall be indemnified to the fullest extent permissible by applicable law against
all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection therewith. If Indemnitee is
not wholly successful in such Proceeding but is successful, on the merits or otherwise, as to one or more but less than all claims, issues
or matters in such Proceeding, the Company shall indemnify to the fullest extent permissible by applicable law Indemnitee against all
Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection with each successfully resolved
claim, issue or matter. For purposes of this Agreement, the termination of any claim, issue or matter in such a Proceeding by dismissal,
with or without prejudice, by reason of settlement, judgment, order or otherwise, shall be deemed to be a successful result as to such
claim, issue or matter.


 


7. Effect
of Certain Resolutions. Neither the settlement nor termination of any Proceeding nor the failure of the Company to award indemnification
or to determine that indemnification is payable shall create a presumption that Indemnitee is not entitled to indemnification hereunder.
In addition, the termination of any Proceeding by judgment, order, settlement, conviction or upon a plea of nolo contendere or its equivalent
shall not create a presumption that Indemnitee did not act in good faith and in a manner which Indemnitee reasonably believed to be in
or not opposed to the best interests of the Company or, with respect to any criminal Proceeding, had reasonable cause to believe that
Indemnitee’s action was unlawful.


 


8. Agreement
to Advance Expenses; Undertaking. The Company shall advance to the fullest extent permissible by applicable law all Expenses actually
and reasonably incurred by or on behalf of Indemnitee in connection with any Proceeding in which Indemnitee is involved by reason of
such Indemnitee’s Corporate Status within thirty (30) calendar days after the receipt by the Company of a written statement from
Indemnitee requesting such advance or advances from time to time, whether prior to or after final disposition of such Proceeding. Advances
shall be unsecured and interest free. Advances shall be made without regard to Indemnitee’s ability to repay the expenses and without
regard to Indemnitee’s ultimate entitlement to indemnification under the other provisions of this Agreement. To the extent required
by Delaware law, Indemnitee hereby undertakes to repay any and all of the amount of Indemnifiable Expenses paid to Indemnitee if it is
finally determined by a court of competent jurisdiction that Indemnitee is not entitled under this Agreement to indemnification with
respect to such Expenses. This undertaking is an unlimited general obligation of Indemnitee.


 






    Page 16 of 21


     


    

 


9. Procedure
for Advance Payment of Expenses. Indemnitee shall submit to the Company a written request specifying the Indemnifiable Expenses for
which Indemnitee seeks an advancement under Section 8 of this Agreement, together with documentation evidencing that Indemnitee has incurred
such Indemnifiable Expenses.


 


10. Indemnification
for Expenses of a Witness. Notwithstanding any other provision of this Agreement, to the extent that Indemnitee is, by reason of
his or her Corporate Status, a witness in any Proceeding to which Indemnitee is not a party, he or she shall be indemnified by the Company
to the fullest extent permissible by applicable law against all Expenses actually and reasonably incurred by him or her or on his or
her behalf in connection therewith.


 


 11. Remedies of Indemnitee.




 


(a) Right
to Petition Court. In the event that Indemnitee makes a request for payment of Indemnifiable Amounts under Sections 3 and 5 above
or a request for an advancement of Indemnifiable Expenses under Sections 8 and 9 above and the Company fails to make such payment or
advancement in a timely manner pursuant to the terms of this Agreement, Indemnitee may petition the Court of Chancery of the State of
Delaware to enforce the Company’s obligations under this Agreement.


 


(b) Burden
of Proof. In any judicial proceeding brought under Section 11(a) above, the Company shall have the burden of proving that Indemnitee
is not entitled to payment of Indemnifiable Amounts hereunder.


 


(c) Expenses.
The Company agrees to reimburse Indemnitee in full for any Expenses in connection with any Proceeding incurred by Indemnitee in connection
with investigating, preparing for, litigating, defending or settling any action brought by Indemnitee under Section 11(a) above, or in
connection with any claim or counterclaim brought by the Company in connection therewith, whether or not Indemnitee is successful in
whole or in part in connection with any such action, except to the extent that it has been finally adjudicated by a court of competent
jurisdiction that such reimbursement would be unlawful.


 


(d) Failure
to Act Not a Defense. The failure of the Company (including its Board of Directors or any committee thereof, independent legal counsel
or stockholders) to make a determination concerning the permissibility of the payment of Indemnifiable Amounts or the advancement of
Indemnifiable Expenses under this Agreement shall not be a defense in any action brought under Section 11(a) above, and shall not create
a presumption that such payment or advancement is not permissible.


 


 12. Defense of the Underlying Proceeding.




 


(a) Notice
by Indemnitee. Indemnitee agrees to notify the Company promptly upon being served with any summons, citation, subpoena, complaint,
indictment, information or other document relating to any Proceeding which may result in the payment of Indemnifiable Amounts or the
advancement of Indemnifiable Expenses hereunder; provided, however, that the failure to give any such notice shall not disqualify Indemnitee
from the right, or otherwise affect in any manner any right of Indemnitee, to receive payments of Indemnifiable Amounts or advancements
of Indemnifiable Expenses unless the Company’s ability to defend in such Proceeding is materially and adversely prejudiced thereby.


 


(b) Defense
by Company. Subject to the provisions of the last sentence of this Section 12(b) and of Section 12(c) below, the Company shall have
the right to defend Indemnitee in any Proceeding which may give rise to the payment of Indemnifiable Amounts hereunder; provided, however,
that the Company shall notify Indemnitee of any such decision to defend within ten (10) calendar days of the Company’s receipt
of notice of any such Proceeding under Section 12(a) above. The Company shall not, without the prior written consent of Indemnitee, consent
to the entry of any judgment against Indemnitee or enter into any settlement or compromise which (i) includes an admission of fault of
Indemnitee or (ii) does not include, as an unconditional term thereof, the full release of Indemnitee from all liability in respect of
such Proceeding, which release shall be in form and substance reasonably satisfactory to Indemnitee. This Section 12(b) shall not apply
to a Proceeding brought by Indemnitee under Section 11(a) above or pursuant to Section 20 below.


 


(c) Indemnitee’s
Right to Counsel. Notwithstanding the provisions of Section 12(b) above, in any Proceeding to which Indemnitee is a party by reason
of Indemnitee’s Corporate Status, at the Indemnitee’s option Indemnitee shall have the right to retain counsel of Indemnitee’s
choice, at the expense of the Company, to represent Indemnitee in connection with any such matter and the Expenses incurred by Indemnitee
in any such matter shall constitute Indemnifiable Expenses.


 






    Page 17 of 21


     


    

 


13. Representations
and Warranties of the Company. The Company hereby represents and warrants to Indemnitee as follows:


 


(a) Authority.
The Company has all necessary power and authority to enter into, and be bound by the terms of, this Agreement, and the execution,
delivery and performance of the undertakings contemplated by this Agreement have been duly authorized by the Company.


 


(b) Enforceability.
This Agreement, when executed and delivered by the Company in accordance with the provisions hereof, shall be a legal, valid and
binding obligation of the Company, enforceable against the Company in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, moratorium, reorganization or similar laws affecting the enforcement of creditors’
rights generally.


 


14. Insurance.
The Company shall, from time to time, make the good faith determination whether or not it is practicable for the Company to obtain and
maintain a policy or policies of insurance with a reputable insurance company providing the Indemnitee with coverage for losses from
wrongful acts. For so long as Indemnitee shall have Corporate Status, Indemnitee shall be named as an insured in all policies of director
and officer liability insurance in such a manner as to provide Indemnitee the same rights and benefits as are accorded to the most favorably
insured of the Company’s officers and directors. If, at the time of the receipt of a notice of a claim pursuant to the terms of
this Agreement, the Company has director and officer liability insurance in effect, the Company shall give prompt notice of the commencement
of such proceeding to the insurers in accordance with the procedures set forth in the respective policies. The Company shall thereafter
take all necessary or desirable action to cause such insurers to pay, on behalf of the Indemnitee, all amounts payable as a result of
such proceeding in accordance with the terms of such policies. Notwithstanding the foregoing, the Company shall have no obligation to
obtain or maintain such insurance if the Company determines in good faith that such insurance is not reasonably available, if the premium
costs for such insurance are disproportionate to the amount of coverage provided, or if the coverage provided by such insurance is limited
by exclusions so as to provide an insufficient benefit.


 


15. No
Duplication of Payments. The Company shall not be liable under this Agreement to make any payment in connection with any claim made
against Indemnitee to the extent Indemnitee has otherwise actually received payment under any insurance policy, provision of the Certificate
or the Bylaws or otherwise of the amounts otherwise indemnifiable hereunder. The Company’s obligation to indemnify or advance Expenses
hereunder to Indemnitee as a result of the Indemnitee’s Corporate Status with an Entity other than the Company shall be reduced
by any amount Indemnitee has actually received as indemnification or advancement of Expenses from such other Entity.


 


16. Contract
Rights Not Exclusive. The rights to payment of Indemnifiable Amounts and advancement of Indemnifiable Expenses provided by this Agreement
shall be in addition to, but not exclusive of, any other rights which Indemnitee may have at any time under applicable law, the Certificate
or Bylaws, or any other agreement, vote of stockholders or directors (or a committee of directors) or otherwise, both as to action in
Indemnitee’s official capacity and as to action in any other capacity as a result of Indemnitee’s serving as a director of
the Company.


 






    Page 18 of 21


     


    

 


17. Successors.
This Agreement shall be (a) binding upon all successors and assigns of the Company (including any transferee of all or a substantial
portion of the business, stock and/or assets of the Company and any direct or indirect successor by merger or consolidation or otherwise
by operation of law) and (b) binding on and shall inure to the benefit of the heirs, personal representatives, executors and administrators
of Indemnitee. This Agreement shall continue for the benefit of Indemnitee and such heirs, personal representatives, executors and administrators
after Indemnitee has ceased to have Corporate Status.


 


18. Change
in Law. To the extent that a change in Delaware law (whether by statute or judicial decision) or the Certificate shall permit broader
indemnification or advancement of expenses than is provided under the terms of the Bylaws and this Agreement, Indemnitee shall be entitled
to such broader indemnification and advancements, and this Agreement shall be deemed to be amended to such extent.


 


19. Severability.
Whenever possible, each provision of this Agreement shall be interpreted in such a manner as to be effective and valid under applicable
law, but if any provision of this Agreement, or any clause thereof, shall be determined by a court of competent jurisdiction to be illegal,
invalid or unenforceable, in whole or in part, such provision or clause shall be limited or modified in its application to the minimum
extent necessary to make such provision or clause valid, legal and enforceable, and the remaining provisions and clauses of this Agreement
shall remain fully enforceable and binding on the parties.


 


20. Indemnitee
as Plaintiff. Except as provided in Section 11(c) of this Agreement and in the next sentence, Indemnitee shall not be entitled to
payment of Indemnifiable Amounts or advancement of Indemnifiable Expenses with respect to any Proceeding brought by Indemnitee against
the Company, any Subsidiary, any Entity which it controls, any director or officer thereof or any third party, unless the Board of Directors
has consented to the initiation of such Proceeding or the Company provides indemnification, in its sole discretion, pursuant to the powers
vested in the Company under applicable law. This Section shall not apply to counterclaims or affirmative defenses asserted by Indemnitee
in an action brought against Indemnitee.


 


21. Modifications
and Waivers; Counterparts. Except as provided in Section 18 above with respect to changes in Delaware law which broaden the right
of Indemnitee to be indemnified by the Company or to receive advancements, no supplement, modification or amendment of this Agreement
shall be binding unless executed in writing by each of the parties hereto. No waiver of any of the provisions of this Agreement shall
be deemed or shall constitute a waiver of any other provisions of this Agreement (whether or not similar), nor shall such waiver constitute
a continuing waiver. This Agreement may also be executed and delivered by facsimile signature and in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute one and the same Agreement.


 






    Page 19 of 21


     


    

 


22. General
Notices. All notices, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been duly
given (a) when delivered by hand, (b) when transmitted by facsimile and receipt is acknowledged during normal business hours, and if
not, the next business day after transmission or (c) if mailed by certified or registered mail with postage prepaid, on the third business
day after the date on which it is so mailed:


 


		(i)	If
                                            to Indemnitee, to:



 


at the residence address
most recently filed with the Company


 


		(ii)	If
                                            to the Company, to:



 


Adial Pharmaceuticals Inc.


1180 Seminole Trail, Suite
495


Charlottesville, VA 22901


Attn: Chief Executive Officer


 


With copy to


 


Gracin & Marlow, LLP


Chrysler Building


405 Lexington Avenue


26th Floor


New York, New York 10174


Attention: Leslie Marlow


 


or to such other address as may have been furnished
in the same manner by any party to the others.


 


23. Governing
Law; Consent to Jurisdiction; Service of Process. This Agreement shall be governed by and construed in accordance with the laws of
the State of Delaware without regard to its rules of conflict of laws. Each of the Company and Indemnitee hereby irrevocably and unconditionally
consents to submit to the exclusive jurisdiction of the Court of Chancery of the State of Delaware and the courts of the United States
of America located in the State of Delaware (the “Delaware Courts”) for any litigation arising out of or relating
to this Agreement and the transactions contemplated hereby (and agrees not to commence any litigation relating thereto except in such
courts), waives any objection to the laying of venue of any such litigation in the Delaware Courts and agrees not to plead or claim in
any Delaware Court that such litigation brought therein has been brought in an inconvenient forum. Each of the parties hereto agrees,
(a) to the extent such party is not otherwise subject to service of process in the State of Delaware, to appoint and maintain an agent
in the State of Delaware as such party's agent for acceptance of legal process, and (b) that service of process may also be made on such
party by prepaid certified mail with a proof of mailing receipt validated by the United States Postal Service constituting evidence of
valid service. Service made pursuant to (a) or (b) above shall have the same legal force and effect as if served upon such party personally
within the State of Delaware. For purposes of implementing the parties’ agreement to appoint and maintain an agent for service
of process in the State of Delaware, each such party does hereby appoint The Corporation Trust Company, Corporation Trust Center, 1209
Orange Street, Wilmington, New Castle County, Delaware 19801, as such agent and each such party hereby agrees to complete all actions
necessary for such appointment. Upon written application by Indemnitee to the Company, the Company shall, on an annual basis, reimburse
Indemnitee the annual fee charged by The Corporation Trust Company to serve as Indemnitee’s agent for service of process within
30 days following the written application for reimbursement.


 


24. Joinders.
Subsidiaries of the Company may from time to time join this Agreement by signing a joinder in substantially the form attached hereto
as Exhibit A. The Company and all Subsidiaries that have joined this Agreement shall be jointly and severally liable for all obligations
of the Company under this Agreement.


 


25. Assignment.
Except as otherwise set forth herein, neither this Agreement nor any of the rights, interests or obligations hereunder may be assigned
by any party hereto, without the prior written consent of all of the other parties hereto.


 


26. Entire
Agreement. Without limitation to the Certificate and the Bylaws, this Agreement constitutes the entire agreement between the parties
hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings, oral, written and implied, between
the parties hereto with respect to the subject matter hereof.


 


[The remainder of this page is intentionally
blank]


 






    Page 20 of 21


     


    

 


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


 


	 	ADIAL PHARMACEUTICALS INC.
	 	 	 
	 	By:	                           
	 	 	Name: William B. Stilley, III
	 	 	Title: Chief Executive Officer
	 	 	 
	 	INDEMNITEE
	 	 	 
	 	                       
	 	Name: Cary J. Claiborne


 


 


 


Page 21 of 21