Document:

EX-10.9

  Exhibit  10.9

   

  IMAGO BIOSCIENCES, INC.

  AMENDED AND RESTATED

  NON-EMPLOYEE DIRECTOR COMPENSATION PROGRAM

   

   

  This Imago BioSciences, Inc. (the “Company”) Amended and Restated Non-Employee Director Compensation Program (this “Program”) has been adopted under the Company’s 2021 Incentive Award Plan (the “Plan”) effective as of November 17, 2021.  This Program amends, restates and supersedes in its entirety the Non-Employee Director Compensation Program adopted by the Company upon the closing of the Company’s initial public offering of its common stock (the “IPO”).  Capitalized terms not otherwise defined herein shall have the meaning ascribed in the Plan.

   

  Cash Compensation

   

  Annual retainers will be paid in the following amounts to Non-Employee Directors:

   

  		
	Non-Employee Director:
	$40,000

	Non-Executive Chair:
	$30,000

	Audit Committee Chair:
	$15,000

	Compensation Committee Chair:
	$10,000

	Nominating and Corporate Governance Committee Chair:
	$8,000

	Audit Committee Member (non-Chair):
	$7,500

	Compensation Committee Member (non-Chair):
	$5,000

	Nominating and Corporate Governance Committee Member (non-Chair):
	$4,000

   

  All annual retainers will be paid in cash quarterly in arrears promptly following the end of the applicable calendar quarter, but in no event more than 30 days after the end of such quarter. In the event a Non-Employee Director does not serve as a Non-Employee Director, or in the applicable positions described above, for an entire calendar quarter, the retainer paid to such Non-Employee Director shall be prorated for the portion of such calendar quarter actually served as a Non-Employee Director, or in such position, as applicable.

   

  Equity Compensation

   

   

   

  

  		
	Initial Stock Option Grant:
	Each Non-Employee Director who is initially elected or appointed to serve on the Board after the IPO shall be granted an Option under the Plan or any other applicable Company equity incentive plan then-maintained by the Company to purchase 23,809 shares of Common Stock.
 
The Initial Option will be automatically granted on the date on which such Non-Employee Director commences service on the Board, and will vest as to 1/36th of the shares subject thereto on each monthly anniversary of the applicable date of grant such that the shares subject to the Initial Option are fully vested on the third anniversary of the grant, subject to the Non-Employee Director continuing in service on the Board through each vesting date.
 

	Annual Stock Option Grant:
	Each Non-Employee Director who has, for at least six months, been serving on the Board as of the date of each annual shareholder meeting of the Company (each, an “Annual Meeting”) shall be granted an Option under the Plan or any other applicable Company equity incentive plan then-maintained by the Company to purchase 11,904 shares of Common Stock. 
 
The Annual Option will be automatically granted on the date of the applicable Annual Meeting, and will vest in full on the earlier of (i) the first anniversary of the date of grant and (ii) immediately prior to the Annual Meeting following the date of grant, subject to the Non-Employee Director continuing in service on the Board through such vesting date.

   

  The per share exercise price of each Option granted to a Non-Employee Director shall equal the Fair Market Value of a share of common stock on the date the Option is granted.

   

  The term of each Option granted to a Non-Employee Director shall be ten years from the date the Option is granted.

   

  No portion of an Initial Option or Annual Option which is unvested or unexercisable at the time of a Non-Employee Director’s termination of service on the Board shall become vested and exercisable thereafter.

   

  Members of the Board who are employees of the Company or any parent or subsidiary of the Company who subsequently terminate their service with the Company and any parent or subsidiary of the Company and remain on the Board will not receive an Initial Option, but to the extent that they are otherwise eligible, will be eligible to receive, after termination from service with the Company and any parent or subsidiary of the Company, Annual Options as described above.

   

  2

   

   

  

  Change in Control

   

  Upon a Change in Control of the Company, all outstanding equity awards granted under the Plan and any other equity incentive plan maintained by the Company that are held by a Non-Employee Director shall become fully vested and/or exercisable, irrespective of any other provisions of the Non-Employee Director’s Award Agreement.

   

  Reimbursements

  The Company shall reimburse each Non-Employee Director for all reasonable, documented, out-of-pocket travel and other business expenses incurred by such Non-Employee Director in the performance of his or her duties to the Company in accordance with the Company’s applicable expense reimbursement policies and procedures as in effect from time to time. 

  Miscellaneous

   

  The other provisions of the Plan shall apply to the Options granted automatically pursuant to this Program, except to the extent such other provisions are inconsistent with this Program.  All applicable terms of the Plan apply to this Program as if fully set forth herein, and all grants of Options hereby are subject in all respects to the terms of the Plan.  The grant of any Option under this Program shall be made solely by and subject to the terms set forth in a written agreement in a form to be approved by the Board and duly executed by an executive officer of the Company.

   

  Effectiveness

   

  This Program became effective as of the consummation of the IPO.  

   

  * * * * *

  3

   

   

  

   

  I hereby certify that the foregoing Program was adopted by the Board of Directors of Imago BioSciences, Inc. on July 12, 2021.

  * * * * *

  I hereby certify that the foregoing Program was approved by the stockholders of Imago BioSciences, Inc. on July 12, 2021.

  Executed on July 12, 2021.

   

  /s/ Benjamin Potter	

  Corporate Secretary

   

   

  2exhibit1014-lancebrownem

EMPLOYMENT AGREEMENT  THIS EMPLOYMENT AGREEMENT (this “Agreement”), dated and effective as of November 1, 2021 (the  “Effective Date”), is entered into by and between Harbor Custom Development, Inc., a Washington corporation (the  “Company”), and Lance Brown (the “Executive”).  WHEREAS, the Company desires to employ the Executive and to enter into an agreement embodying the  terms of such employment; and  WHEREAS, the Executive desires to accept employment with the Company, subject to the terms and  conditions of this Agreement.  NOW, THEREFORE, in consideration of the premises and mutual covenants herein and for other good and  valuable consideration, the parties agree as follows:  1. Employment, Duties and Agreements.  (a) The Company hereby agrees to employ the Executive as its Chief Financial Officer and the  Executive hereby accepts such position and agrees to serve the Company in such capacity on a full-time basis during  the employment period fixed by Section 3 hereof (the “Employment Period”). The Executive shall report to the  Company’s Chief Executive Officer (“CEO”). The Executive’s principal place of employment shall be Alpharetta,  Georgia.  The Executive shall have such duties and responsibilities as are consistent with the Executive’s position  and as may be reasonably assigned by the CEO from time to time. During the Employment Period, the Executive  shall be subject to, and shall act in accordance with, all reasonable instructions and directions of the CEO and all  applicable policies and rules of the Company.  (b) During the Employment Period, excluding any periods of vacation and sick leave to which the  Executive is entitled, the Executive shall devote his full working time and efforts to the performance of his duties  and responsibilities hereunder and shall endeavor to promote the business and best interests of the Company.  (c) During the Employment Period, the Executive shall not engage in any business activity other than  the Company without the express prior written approval of the Company’s Board of Directors (the “Board”).  Notwithstanding the foregoing, during the Employment Period, it shall not be a violation of this Agreement for the  Executive to (A) serve on corporate, civic or charitable boards or committees consistent with the Company’s  conflicts of interests policies and corporate governance guidelines in effect from time to time, (B) deliver lectures or  fulfill speaking engagements, or (C) manage his personal investments, so long as such activities do not interfere with  the performance of the Executive’s responsibilities as an executive officer of the Company.    2. Compensation. During the Employment Period:  (a) Base Salary. As compensation for the agreements made by the Executive herein and the performance  by the Executive of his obligations hereunder, during the Employment Period, the Company shall pay the Executive,  pursuant to the Company’s normal and customary payroll procedures, a base salary at the rate of $280,000 per  annum (the “Base Salary”). During the Employment Period, the Base Salary shall be reviewed at least annually for  possible increase in the Board of Director’s Compensation Committee’s sole discretion. Any increase in Base Salary  shall not serve to limit or reduce any other obligation to the Executive under this Agreement. The term “Base  Salary” as utilized in this Agreement shall refer to Base Salary as so adjusted pursuant to this section.  (b) Annual Bonus. In addition to the Base Salary, the Executive shall be eligible, through participation  in the Company’s annual bonus plan or other similar plan to the extent then in effect, to earn an annual bonus (the  “Annual Bonus”) in each fiscal year during the Employment Period, with a target Annual Bonus of fifty percent  (50%) of Base Salary (the “Target Bonus”), with an opportunity to earn up to sixty percent (60%) of Base Salary,  with the actual payout based on the achievement of annual individual and Company performance objectives  established by the Compensation Committee of the Board. For calendar year 2021, Executive’s Annual Bonus  amount will be pro-rated based on the number of days between the Effective Date and December 31, 2021.  Any  DocuSign Envelope ID: 4619CEDF-68A4-4ED4-A4EE-B9DA5E8720C6 

 

Annual Bonus shall be paid on or before March 15th of each calendar year immediately following the year in which  compensation is earned in accordance with the applicable plan (except as otherwise provided herein). In addition,  the Executive shall be paid a one-time sign-on bonus of $75,000 within ninety (90) days of the Effective Date.  (c) Long Term Incentive Award. As soon as administratively practicable on or after the Effective Date,  the Company shall grant to Executive 100,000 restricted stock units, each representing the right to earn a share of  the common stock of the Company (the “Restricted Stock Units”).  The Restricted Stock Units shall be subject to a  time-based vesting schedule, the terms and conditions of which shall be set forth in restricted stock unit award  agreements to be entered into by and between the Company and the Executive in the form adopted by the Board or  the Compensation Committee, as applicable (the “Equity Agreements”).    (d) Benefit Plans. In addition, (i) the Executive shall be eligible to participate in all other incentive  plans, practices, policies and programs, and all savings and retirement plans, policies and programs, in each case that  are applicable generally to senior executives of the Company; (ii) the Executive and the Executive’s eligible family  members shall be eligible for participation in the welfare benefit plans, practices, policies and programs (including,  if applicable, medical, dental, vision, disability, employee life, group life and accidental death insurance plans and  programs) maintained by the Company for its senior executives; and (iii) the Executive shall be entitled to receive  prompt reimbursement for all reasonable business expenses incurred by the Executive in accordance with subsection  (g) below and the policies, practices, and procedures of the Company provided to senior executives of the Company.   Company agrees to reimburse Executive for any COBRA premiums incurred by Executive from the Effective Date  until such time as Executive becomes eligible for the Company’s medical insurance plans.   (e) PTO. The Executive shall be entitled to twenty (20) days paid personal time off (PTO) per year, and  to such paid holidays as are observed by the Company from time to time, all in accordance with the Company’s  policies and practices that are applicable to the Company’s senior executives. Unused PTO will be carried over from  year to year as provided in the Company’s plans and polices in effect from time to time.  (f) Insurance. The Company shall maintain (i) a directors’ and officers’ liability insurance policy, or an  equivalent errors and omissions liability insurance policy and (ii) an employment practices liability insurance policy.  Each such policy shall cover the Executive with scope, exclusions, amounts and deductibles no less favorable to the  insured than those applicable to the Company’s senior executive officers and directors on the Effective Date, or any  more favorable as may be available to any other director or senior executive officer of the Company, while the  Executive is employed with the Company and thereafter until the sixth anniversary of the Executive’s Scheduled  Termination Date (as defined below).   (g) Business Expenses. The Company shall reimburse the Executive for all reasonable business  expenses (including related travel expenses) between Executive’s home base in Alpharetta, Georgia or other  Company locations as required upon the presentation of statements of such expenses in accordance with the  Company’s policies and procedures now in force or as such policies and procedures may be modified with respect to  all senior executive officers of the Company.  3. Employment Period. The Employment Period shall commence on the Effective Date and shall terminate on  the third (3rd) anniversary of the Effective Date, provided that on the third (3rd) anniversary of the Effective Date and  on each anniversary thereafter, the Employment Period shall automatically be extended for additional one (1)-year  periods unless either party provides the other party with notice of non-renewal at least ninety (90) days before any  such anniversary (the anniversary date on which the Employment Period terminates shall be referred to herein as the  “Scheduled Termination Date”). Notwithstanding the foregoing, the Executive’s employment hereunder may be  terminated during the Employment Period prior to the Scheduled Termination Date upon the earliest to occur of any  one of the following events (at which time the Employment Period shall be terminated):  (a) Death. The Executive’s employment hereunder shall terminate upon his death.  (b) Disability. The Company shall be entitled to terminate the Executive’s employment hereunder for  Disability. For purposes of this Agreement, “Disability” means the Executive’s inability by reason of physical or  mental illness to fulfill his obligations hereunder for ninety (90) consecutive days or a total of one hundred eighty  (180) days in any twelve (12)-month period which, in the reasonable opinion of an independent physician selected  DocuSign Envelope ID: 4619CEDF-68A4-4ED4-A4EE-B9DA5E8720C6 

 

by the Company or its insurers and reasonably acceptable to the Executive or the Executive’s legal representative,  renders the Executive unable to perform the essential functions of his job, even after reasonable accommodations are  made by the Company.    (c) Cause. The Company may terminate the Executive’s employment hereunder for Cause. For purposes  of this Agreement, the term “Cause” shall mean:  (i) conviction by the Executive of a felony;  (ii) acts of fraud, dishonesty or misappropriation committed by the Executive and intended to  result in substantial personal enrichment at the expense of the Company;  (iii) willful misconduct by the Executive in the performance of the Executive’s duties required  by this Agreement which is likely to materially damage the financial position or reputation of the Company;  (iv) a breach of Section 7 of this Agreement.  The foregoing is an exclusive list of the acts or omissions that shall be considered Cause. Notwithstanding the  foregoing, the termination of the Executive shall not be deemed to be for Cause unless and until the Board shall have  provided the Executive with a Notice of Termination (as defined in Section 4 below) specifying in detail the basis  for the termination of employment for Cause and the provision(s) under this Agreement on which such termination  is based.   (d) Without Cause. The Company may terminate the Executive’s employment hereunder during the  Employment Period without Cause. For purposes of this Agreement, a notice of non-renewal given by the Company  as provided in Section 3 herein shall be treated as a termination of employment by the Company without Cause.    (e) For Good Reason. The Executive may terminate his employment hereunder for Good Reason. For  purposes of this Agreement, “Good Reason” shall mean: (i) a material breach of this Agreement by the Company  (including the Company’s withholding or failure to pay compensation when due to the Executive); (ii) a material  reduction in the Executive’s titles, duties, authority, or responsibilities, or the assignment to the Executive of any  duties materially inconsistent with the Executive’s position, authority, duties, or responsibilities without the written  consent of the Executive; (iii) a reduction in the Executive’s annual Base Salary or Annual Bonus opportunity, as  currently in effect or as may be increased from time to time; or (iv) a requirement for the Executive to work  somewhere other than his principal place of business, which is home address, or to travel more than stated in his  offer letter without his written consent. With respect to the acts or omissions set forth in this subsection (e), (A) the  Executive shall provide the Board with a Notice of Termination (as defined in Section 4 below) specifying in detail  the basis for the termination of employment for Good Reason and the provision(s) under this Agreement on which  such termination is based, (B) the Company shall have thirty (30) days to cure the matters specified in the notice  delivered, and (C) if uncured, the Executive must terminate his employment with the Company within ninety  (90) days after the initial existence of the circumstances constituting Good Reason in order for such termination to  be considered to be for Good Reason.  (f) Voluntarily. The Executive may voluntarily terminate his employment hereunder, without Good  Reason, provided that the Executive provides the Company with notice of his intent to terminate his employment at  least thirty (30) days prior to the Date of Termination (as defined in Section 4 below).  4. Termination Procedure.  (a) Notice of Termination. Any termination of the Executive’s employment by the Company or by the  Executive during the Employment Period (other than a termination on account of the death of the Executive) shall  be communicated by a written “Notice of Termination” to the other party hereto in accordance with Section 8(a).  (b) Date of Termination. “Date of Termination” shall mean (i) if the Executive’s employment is  terminated by his death, the date of his death, (ii) if the Executive’s employment is terminated pursuant  to Section 3(b), on the date the Executive receives Notice of Termination from the Company, (iii) if the Executive  DocuSign Envelope ID: 4619CEDF-68A4-4ED4-A4EE-B9DA5E8720C6 

 

voluntarily terminates his employment (whether or not for Good Reason), the date specified in the notice given  pursuant to Section 3(e) or 3(f) herein which shall not be less than thirty (30) days after the Notice of Termination,  and (iv) if the Executive’s employment is terminated for any other reason, the date on which a Notice of  Termination is given or any later date (within thirty (30) days, or any alternative time period agreed upon by the  parties, after the giving of such notice) set forth in such Notice of Termination.  5. Termination Payments.  (a) Without Cause or for Good Reason. In the event the Employment Period terminates under this  Agreement as a result of the Company terminating the Executive’s employment without Cause (other than pursuant  to Sections 3(a) or (b)) or the Executive terminating his employment for Good Reason:  (i) The Company shall pay to the Executive, within thirty (30) days following the Date of  Termination (A) the Executive’s accrued but unused vacation, unreimbursed business expenses and Base Salary  through the Date of Termination (to the extent not theretofore paid) (the “Accrued Benefits”), and (B) one hundred  percent (100%) of Executive’s Base Salary, in each case payable in a lump sum (the “Base Severance”).  (ii) The Company shall pay to the Executive, in lieu of any Annual Bonus under Section 2(b) for  the fiscal year in which Executive’s employment terminates, a lump sum amount equal to 100% of the Target  Annual Bonus.  In addition, the Company shall provide to the Executive an additional amount, each month for  twelve (12) months after the Date of Termination, equal to the amount the Company would have paid for its share of  the premiums for the Executive and his dependents coverage under the Company’s medical plan as if the  Executive’s employment had not terminated.  (iii) All outstanding Restricted Stock Units and other previously granted equity awards that  would have otherwise vested within twelve (12) months of the Date of Termination shall become fully vested.  (iv) To the extent not theretofore paid or provided, the Company shall timely pay or provide to  the Executive any vested benefits and other amounts or benefits required to be paid or provided or which the  Executive is eligible to receive as of the Date of Termination under any plan, program, policy, practice, contract, or  agreement of the Company and its affiliates (such other amounts and benefits shall be hereinafter referred to as the  “Other Benefits”).  (v) If the Date of Termination under this Section 5(a) occurs within the eighteen (18)-month  period following a Change in Control, in addition to the other payments provided for in this Section 5(a), the  Company shall pay the Executive an amount equal to fifty percent (50%) of the Executive’s Base Salary plus Target  Bonus for the current fiscal year, in a lump sum cash payment, within thirty (30) days of the Date of Termination.   For purposes of this Agreement, “Change in Control” shall have the meaning specified on Exhibit A attached hereto.  (vi) For the avoidance of doubt, upon termination of the Employment Period without Cause or as  a result of Good Reason, the Executive shall not be entitled to any other compensation or benefits not expressly  provided for in this Section 5(a), regardless of the time that would otherwise remain in the Employment Period had  the Employment Period not been terminated without Cause or for Good Reason, except any benefits or  compensation provided under the Equity Agreements which shall be paid in accordance with such agreements.  Except as provided in this Section 5(a), any vested benefits under any tax qualified pension plans of the Company,  and continuation of health insurance benefits on the terms and to the extent required by Section 4980B of the  Internal Revenue Code of 1986, as amended (the “Code”) and Section 601 of the Employee Retirement Income  Security Act of 1974, as amended (which provisions are commonly known as “COBRA”) or such other analogous  legislation as may be applicable to the Executive, the Company shall have no additional obligations under this  Agreement.  (vii) The payments and benefits provided under this Section 5(a) are subject to and conditioned  upon (A) the Executive executing a timely and valid release of claims (“Release”) in the form attached hereto  as Exhibit B, or other substantially similar agreement releasing claims agreed to by the Company and the Executive,  waiving all claims the Executive may have against the Company, its successors, assigns, affiliates, executives,  officers and directors, (B) the Executive delivering the executed Release to the Company within twenty-one (21)  days following the Date of Termination, (C) such Release and the waiver contained therein becoming effective and  DocuSign Envelope ID: 4619CEDF-68A4-4ED4-A4EE-B9DA5E8720C6 

 

not revoked. In the event that payments are made hereunder prior to the execution of the Release and the Executive  does not execute the Release in the time and manner set forth herein, the Executive shall promptly pay to the  Company such amounts or the value of such benefits so received.  (b) Cause or Voluntarily Other than for Good Reason. If the Executive’s employment is terminated  during the Employment Period by the Company for Cause or voluntarily by the Executive other than for Good  Reason, the Company shall pay the Executive upon the Date of Termination the Accrued Benefits and the Other  Benefits and any benefits or compensation provided under the Equity Agreements which shall be paid in accordance  with such agreements. Except as provided in this Section 5(b) or with respect to any vested benefits under any tax  qualified pension plans of the Company and the continuation of health insurance benefits on the terms and to the  extent required by COBRA or any other analogous legislation as may be applicable to the Executive, the Company  shall have no additional obligations under this Agreement.  (c) Disability or Death. If the Executive’s employment is terminated during the Employment Period as a  result of the Executive’s death or Disability, the Company shall pay the Executive or the Executive’s estate, as the  case may be, within thirty (30) days following the Date of Termination, the Accrued Benefits and Other Benefits  and any benefits or compensation to be paid under the Equity Agreements. Except as provided in this Section 5(c),  or pursuant to the terms of the Equity Agreements, and except for any vested benefits under any tax qualified  pension plans of the Company, and continuation of health insurance benefits on the terms and to the extent required  by COBRA or any other analogous legislation as may be applicable to the Executive, the Company shall have no  additional obligations under this Agreement.  6. Compliance with Section 409(A). This Agreement is intended to either comply with, or fall within an  exemption to, the requirements of Section 409A of the Code, and shall be interpreted and construed consistently  with such intent. To the maximum extent possible, the payments to the Executive pursuant to this Agreement are  also intended to be exempt from Section 409A of the Code under either the separation pay exemption pursuant to  Treasury regulation § 1.409A-1(b)(9)(iii) or as short-term deferrals pursuant to Treasury regulation § 1.409A- 1(b)(4). In the event the terms of this Agreement would subject the Executive to taxes or penalties under  Section 409A of the Code (“409A Penalties”), the Company and Executive shall cooperate diligently to amend the  terms of this Agreement to avoid such 409A Penalties, to the extent possible; provided that such amendment shall  not increase or reduce (in the aggregate) the amounts payable to the Executive hereunder. Any taxable  reimbursement payable to the Executive pursuant to this Agreement shall be paid to the Executive no later than the  last day of the calendar year following the calendar year in which the Executive incurred the reimbursable expense.  Any amount of expenses eligible for taxable reimbursement, or such in-kind benefit provided, during a calendar year  shall not affect the amount of such expenses eligible for reimbursement, or such in-kind benefit to be provided,  during any other calendar year. The right to such reimbursement or such in-kind benefits pursuant to this Agreement  shall not be subject to liquidation or exchange for any other benefit. Any right to a series of installment payments  pursuant to this Agreement is to be treated as a right to a series of separate payments. If, as of the Date of  Termination, the Executive is a “specified employee”, then no payment or benefit that is payable on account of the  Executive’s “separation from service”, as that term is defined for purposes of Section 409A of the Code, shall be  made before the date that is six (6) months after the Executive’s “separation from service” (or, if earlier, the date of  the Executive’s death) if and to the extent that such payment or benefit constitutes deferred compensation (or may  be nonqualified deferred compensation) under Section 409A of the Code and such deferral is required to comply  with the requirements of Section 409A of the Code. Any payment or benefit delayed by reason of the prior sentence  shall be paid out or provided in a single lump sum at the end of such required delay period in order to catch up to the  original payment schedule. For purposes of this provision, the Executive shall be considered to be a “specified  employee” if, at the time of his “separation from service”, the Executive is a “key employee”, within the meaning of  Section 416(i) of the Code, of the Company (or any person or entity with whom the Company would be considered a  single employer under Section 414(b) or Section 414(c) of the Code) any stock of which is publicly traded on an  established securities market or otherwise.  7. Protective Covenants.  (a) General.  Executive and the Company understand and agree that the purpose of the provisions of  this Section 7 is to protect legitimate business interests of the Company, as more fully described below, and is not  intended to impair or infringe upon Executive’s right to work, earn a living, or acquire and possess property from the  DocuSign Envelope ID: 4619CEDF-68A4-4ED4-A4EE-B9DA5E8720C6 

 

fruits of his labor.  Executive hereby acknowledges that Executive has received good and valuable consideration for  the post-employment restrictions set forth in this Section 7 in the form of the compensation and benefits provided  for herein.  Executive hereby further acknowledges that the post-employment restrictions set forth in this Section 7  are reasonable and that they do not, and will not, unduly impair his ability to earn a living after the termination of  this Agreement.    In addition, the parties acknowledge: (A) that Executive’s services under this Agreement require unique  expertise and talent in the provision of Competitive Services and that Executive will have substantial contacts with  customers, suppliers, advertisers and vendors of the Company; (B) that pursuant to this Agreement, Executive will  be placed in a position of trust and responsibility and he will have access to a substantial amount of Confidential  Information and Trade Secrets and that the Company is placing him in such position and giving him access to such  information in reliance upon his agreement to abide by the covenants set forth in this Section 7; (C) that due to  Executive’s unique experience and talent, the loss of Executive’s services to the Company under this Agreement  cannot reasonably or adequately be compensated solely by damages in an action at law; (D) that Executive is  capable of competing with the Company; and (E) that Executive is capable of obtaining gainful, and desirable  employment that does not violate the restrictions contained in this Agreement.    Therefore, Executive shall be subject to the restrictions set forth in this Section 7.  (b) Definitions. The following capitalized terms used in this Agreement shall have the meanings  assigned to them below, which definitions shall apply to both the singular and the plural forms of such terms:  (i) “Competitive Services” means any business that sells or provides products and services  that are the same as or substantially similar to or are otherwise competitive with the products or services sold or  provided by the Company (including the Company’s subsidiaries and affiliates).  Competitive Services shall also  include any products or services that the Executive has actual or constructive knowledge are planned to be sold or  provided by the Company (and the Company’s subsidiaries and affiliates) at any time while the Executive is  employed by the Company.    (ii) “Confidential Information” means any and all data and information relating to the  Company, its activities, business, or customers that (A) was disclosed to Executive or of which Executive became  aware as a consequence of his employment with the Company; (B) has value to the Company; and (C) is not  generally known outside of the Company.  “Confidential Information” shall include, but is not limited to the  following types of information regarding, related to, or concerning the Company: trade secrets (as defined by  applicable law); financial plans and data; management planning information; business plans; operational methods;  market studies; marketing plans or strategies; pricing information; product development techniques or plans;  customer lists; customer files, data and financial information; details of customer contracts; current and anticipated  customer requirements; identifying and other information pertaining to business referral sources; past, current and  planned research and development; computer aided systems, software, strategies and programs; information  technology (“IT”) systems, IT system maps, server data, IT system security protocols, or IT user information;  business acquisition plans; management organization and related information (including, without limitation, data  and other information concerning the compensation and benefits paid to officers, directors, employees and  management); personnel and compensation policies; new personnel acquisition plans; and other similar information.   “Confidential Information” also includes combinations of information or materials which individually may be  generally known outside of the Company, but for which the nature, method, or procedure for combining such  information or materials is not generally known outside of the Company.  In addition to data and information  relating to the Company, “Confidential Information” also includes any and all data and information relating to or  concerning a third party that otherwise meets the definition set forth above, that was provided or made available to  the Company by such third party, and that the Company has a duty or obligation to keep confidential.  This  definition shall not limit any definition of “confidential information” or any equivalent term under state or federal  law.  “Confidential Information” shall not include information that has become generally available to the public by  the act of one who has the right to disclose such information without violating any right or privilege of the  Company.   (iv) “Person” means any individual or any corporation, partnership, joint venture, limited  liability company, association or other entity or enterprise.  DocuSign Envelope ID: 4619CEDF-68A4-4ED4-A4EE-B9DA5E8720C6 

 

(v) “Principal or Representative” means a principal, owner, partner, shareholder, joint  venturer, investor, member, trustee, director, officer, manager, employee, agent, representative or consultant.  (vi) “Protected Customer” means any Person to whom the Company has sold its products or  services or actively solicited to sell its products or services, and with whom Executive has had contact on behalf of  the Company during his employment with the Company or Executive learned of during Executive’s employment  with Company.  (vii) “Protective Covenants” means the restrictive covenants contained in Sections 7(c)  through (g) hereof.  (viii) “Restricted Period” means any time during Executive’s employment with the Company,  as well as one (1) year from Executive’s Date of Termination.  (ix) “Restricted Territory” means (A) the following states: California, Florida, Texas, and   Washington and (B) any other territory where Employee is working on behalf of the Company, but for the state of  his domicile assuming the Company does not conduct business in said state, during the one (1) year preceding the  conduct in question (if the conduct occurs while Employee is still employed by the Company) or the Termination  Date (if the conduct occurs after Employee’s Termination), as applicable.  (x) “Termination” means the termination of Executive’s employment with the Company, for  any reason, whether with or without cause, upon the initiative of either party.  (c) Restriction on Disclosure and Use of Confidential Information.  Executive agrees that Executive  shall not, directly or indirectly, use any Confidential Information on Executive’s own behalf or on behalf of any  Person other than Company, or reveal, divulge, or disclose any Confidential Information to any Person not expressly  authorized by the Company to receive such Confidential Information.  Executive understands and agrees that this  restriction shall continue to apply after the termination of Executive’s employment for any reason, and shall remain  in effect for as long as the information or materials in question retain their status as Confidential Information.   Executive further agrees that he shall fully cooperate with the Company in maintaining the Confidential Information  to the extent permitted by law. The parties acknowledge and agree that this Agreement is not intended to, and does  not, alter either the Company’s rights or Executive’s obligations under any state or federal statutory or common law  regarding trade secrets and unfair trade practices.  Anything herein to the contrary notwithstanding, Executive shall  not be restricted from: (i) disclosing information that is required to be disclosed by law, court order or other valid  and appropriate legal process; provided, however, that in the event such disclosure is required by law, Executive  shall provide the Company with prompt notice of such requirement so that the Company may seek an appropriate  protective order prior to any such required disclosure by Executive; (ii) reporting possible violations of federal,  state, or local law or regulation to any governmental agency or entity, or from making other disclosures that are  protected under the whistleblower provisions of federal, state, or local law or regulation, and Executive shall not  need the prior authorization of the Company to make any such reports or disclosures and shall not be required to  notify the Company that Executive has made such reports or disclosures.  In addition, and anything herein to the  contrary notwithstanding, Executive is hereby given notice that Executive shall not be criminally or civilly liable  under any federal or state trade secret law for: (iii) disclosing a trade secret (as defined by 18 U.S.C. § 1839) in  confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney, in either  event solely for the purpose of reporting or investigating a suspected violation of law; or (iv) disclosing a trade  secret (as defined by 18 U.S.C. § 1839) in a complaint or other document filed in a lawsuit or other proceeding, if  such filing is made under seal.  (d) Non-Competition.  Executive agrees that, during the Restricted Period, he will not, without prior  written consent of the Company, directly or indirectly (i) carry on or engage in Competitive Services within the  Restricted Territory on his own or on behalf of any Person or any Principal or Representative of any Person, or (ii)  own, manage, operate, join, control or participate in the ownership, management, operation or control, of any  business, whether in corporate, proprietorship or partnership form or otherwise where such business is engaged in  the provision of Competitive Services within the Restricted Territory.  DocuSign Envelope ID: 4619CEDF-68A4-4ED4-A4EE-B9DA5E8720C6 

 

(e) Non-Solicitation of Protected Customers.  Executive agrees that, during the Restricted Period, he  shall not, without the prior written consent of the Company, directly or indirectly, on his own behalf or as a Principal  or Representative of any Person, solicit, divert, take away, or attempt to solicit, divert, or take away a Protected  Customer for the purpose of engaging in, providing, or selling Competitive Services.  (f) Non-Recruitment of Employees and Independent Contractors.  Executive agrees that during the  Restricted Period, he shall not, directly or indirectly, whether on his own behalf or as a Principal or Representative  of any Person, hire, recruit, solicit, or induce or attempt to hire, recruit, solicit or induce any individual who is an  employee (temporary or full-time or part-time) independent contractor, or consultant for the Company to leave his or  his employment or engagement to provide Competitive Services.     (g) Return of Materials.  Executive agrees that on or prior to the Date of Termination, he returned any  and all property of the Company that was in his possession or subject to his control by virtue of his position as an  executive of the Company, including, but not limited to, customer files and information, papers, drawings, notes,  manuals, specifications, designs, devices, code, email, documents, diskettes, CDs, tapes, keys, access cards, credit  cards, identification cards, equipment, computers, mobile devices, other electronic media, all other files and  documents relating to the Company and its business (regardless of form, but specifically including all electronic files  and data of the Company), together with all Confidential Information belonging to the Company or that Executive  received from or through his employment with the Company.  Executive will not make, distribute, or retain copies  of any such information or property.  To the extent that Executive has electronic files or information in his  possession or control that belong to the Company or contain Confidential Information (specifically including but not  limited to electronic files or information stored on personal computers, mobile devices, electronic media, or in cloud  storage), on or prior to the Date of Termination, or at any other time the Company requests, Executive shall (i)  provide the Company with an electronic copy of all of such files or information (in an electronic format that readily  accessible by the Company); (ii) after doing so, delete all such files and information, including all copies and  derivatives thereof, from all non-Company-owned computers, mobile devices, electronic media, cloud storage, and  other media, devices, and equipment, such that such files and information are permanently deleted and irretrievable;  and (iii) provide a written certification to the Company that the required deletions have been completed and  specifying the files and information deleted and the media source from which they were deleted.  (h) Enforcement of Protective Covenants.    (i) Rights and Remedies Upon Breach.  The parties specifically acknowledge and agree that  the remedy at law for any breach of the Protective Covenants will be inadequate, and that in the event Executive  breaches, or threatens to breach, any of the Protective Covenants, the Company shall have the right and remedy, to  enjoin, preliminarily and permanently, Executive from violating or threatening to violate the Protective Covenants  and to have the Protective Covenants specifically enforced by any court of competent jurisdiction or arbitrator, it  being agreed that any breach or threatened breach of the Protective Covenants would cause irreparable injury to the  Company and that money damages would not provide an adequate remedy to the Company.  Such rights and  remedies shall be in addition to, and not in lieu of, any other rights and remedies available to the Company at law or  in equity.  The parties understand and agree that if the parties become involved in legal action regarding the  enforcement of the Protective Covenants, the prevailing party in such legal action shall be entitled, in addition to any  other remedy, to recover from the other party its reasonable attorney fees and cost incurred in connection with such  litigation.  The Company’s ability to enforce its rights under the Protective Covenants or applicable law against  Executive shall not be impaired in any way by the existence of a claim or cause of action on the part of Executive  based on, or arising out of, this Agreement or any other event or transaction.    (ii) Severability and Modification of Covenants.  Executive acknowledges and agrees that,  given the nature of the business of the Company and Executive’s role and responsibilities, each of the Protective  Covenants is reasonable and valid in time and scope and in all other respects, because of the scope of the Company’s  operations and Executive’s activities on its behalf.  Executive further acknowledges that the Protective Covenants  are narrowly tailored as to time, geography, and scope of activity to be restrained, and operate to avoid unfair  competition and irreparable harm to the Company.  Executive acknowledges and agrees that the Protective  Covenants set forth herein do not constitute a general restraint that prevent Executive from engaging in a lawful  profession, nor do they operate as a general covenant against competition.  The parties agree that it is their intention  that the Protective Covenants be enforced in accordance with their terms to the maximum extent permitted by law.   DocuSign Envelope ID: 4619CEDF-68A4-4ED4-A4EE-B9DA5E8720C6 

 

Each of the Protective Covenants shall be considered and construed as a separate and independent covenant.  Should  any part or provision of any of the Protective Covenants be held invalid, void, or unenforceable, such invalidity,  voidness, or unenforceability shall not render invalid, void, or unenforceable any other part or provision of this  Agreement or such Protective Covenant.  If any of the provisions of the Protective Covenants should ever be held by  a court of competent jurisdiction to exceed the scope permitted by the applicable law, such provision or provisions  shall be automatically modified to such lesser scope as such court may deem just and proper for the reasonable  protection of the Company’s legitimate business interests and may be enforced by the Company to that extent in the  manner described above and all other provisions of this Agreement shall be valid and enforceable.      (iii) Extension of Restrictions.  If Executive is found to have violated any of the provisions of  Section 7, Executive agrees that the Restricted Period set forth therein shall be extended by a period of time equal to  the period of such violation by Executive.  It is the intent of this paragraph that the running of the applicable Restricted  Period shall be tolled during any period of violation of Section 7 so that the Company may obtain the full and  reasonable protection for which it contracted and so that Executive may not profit by any breach of such provisions.     8. Miscellaneous.  (a) Notices. Any notice or other communication required or permitted under this Agreement shall be  effective only if it is in writing and shall be deemed to be given when delivered personally or four (4) days after it is  mailed by registered or certified mail, postage prepaid, return receipt requested or one (1) day after it is sent by a  reputable overnight courier service and, in each case, addressed as follows (or if it is sent through any other method  agreed upon by the parties), or to any new address that the company may have, if reasonably know to the Executive:     If to the Company: Harbor Custom Development, Inc.  11505 Burnham Dr. Suite 301  Gig Harbor, WA 98332  Attention: Chief Executive Officer  CC: Chief Operating Officer     If to the Executive: Lance Brown      13840 Belleterre Drive      Alpharetta, GA 30004  or to such other address as any party hereto may designate by notice to the others.  (b) Arbitration. To the fullest extent allowed by law, any controversy, claim or dispute between the  Executive and the Company (and/or any of its owners, directors, officers, employees, affiliates, or agents) relating to  or arising out of the Executive’s employment or the cessation of that employment will be submitted to final and  binding arbitration in Pierce County, Washington in accordance with the American Arbitration Association’s  (“AAA”) National Rules for the Resolution of Employment Disputes (which may be found  at https://www.adr.org/sites/default/files/Employment%20Rules.pdf), as the exclusive remedy for such controversy,  claim or dispute. In any such arbitration, the parties may conduct discovery in accordance with the Federal Rules of  Civil Procedure, except that the arbitrator shall have the authority to order and permit discovery as the arbitrator may  deem necessary and appropriate in accordance with applicable state or federal discovery statutes. The arbitrator shall  issue a reasoned, written decision, and shall have full authority to award all remedies which would be available in  court. The arbitrators’ fees and expenses and all administrative fees and expenses associated with the filing of the  arbitration shall be borne by Company; provided however, that at Executive’s option, Executive may voluntarily pay  up to one-half the costs and fees. Any judgment upon the award rendered by the arbitrator(s) may be entered in any  court having jurisdiction thereof. Possible disputes covered by the above include (but are not limited to) unpaid  wages, breach of contract, torts, violation of public policy, discrimination, harassment, or any other employment- related claims under laws including but not limited to, Title VII of the Civil Rights Act of 1964, the Americans With  Disabilities Act, the Age Discrimination in Employment Act, and any other statutes or laws relating to an  employee’s relationship with her/her employer, regardless of whether such dispute is initiated by the employee or  the Company. Thus, this bilateral arbitration provision applies to any and all claims that the Company may have  against the Executive, including, but not limited to, claims for misappropriation of Company property, disclosure of  DocuSign Envelope ID: 4619CEDF-68A4-4ED4-A4EE-B9DA5E8720C6 

 

proprietary information or trade secrets, interference with contract, trade libel, gross negligence, or any other claim  for alleged wrongful conduct or breach of the duty of loyalty by the Executive. However, nothing herein shall  prevent Executive from filing and pursuing proceedings before the United States Equal Employment Opportunity  Commission (although if Executive chooses to pursue a claim following the exhaustion of such administrative  remedies, that claim would be subject to the provisions of this Agreement). Notwithstanding anything to the  contrary contained herein, the Company and the Executive shall have their respective rights to seek and obtain  temporary or preliminary injunctive relief from a court of competent jurisdiction with respect to any controversy,  claim or dispute to the extent permitted by applicable law. BY AGREEING TO THIS BINDING ARBITRATION  PROVISION, BOTH EXECUTIVE AND THE COMPANY GIVE UP ALL RIGHTS TO TRIAL BY JURY. This  arbitration provision is to be construed as broadly as is permissible under applicable law. Executive and Company  acknowledge and agree that their obligations to arbitrate under this Agreement survive the termination of this  Agreement and continue after the termination of the employment relationship between Executive and Company.  (c) Intellectual Property.  Executive agrees to fully and promptly disclose to the Company, without  additional compensation, all ideas, inventions, discoveries, improvements, designs, processes, production methods  and technological innovations, whether or not patentable, which, while employed by the Company, are made,  conceived or reduced to practice by Executive, alone or with others, during or after usual working hours either on or  off Executive’s job, and which are related to the business of or which result from tasks assigned to Executive by the  Company (“Intellectual Property”).  Executive acknowledges that the Company owns all such Intellectual Property  rights as works made for hire to the fullest extent permitted by law and, for the avoidance of doubt, assigns to the  Company all such rights in any and all Intellectual Property now known or hereafter developed, during the course of  employment.  Executive agrees, at any time during or after employment, to sign all papers and do such other acts  and things, at the Company’s expense, as the Company deems necessary or desirable and may reasonably require of  Executive to protect the Company’s rights to such Intellectual Property, including applying for, obtaining and  enforcing patents on such Intellectual Property in any and all countries.  (d) Non-Disparagement.  To the extent permitted by law, during the period of Executive’s employment  with the Company and after cessation thereof for any reason, Executive agrees not to engage in any form of conduct  or make any statements or representations that disparage, portray in a negative light, or otherwise impair the  reputation, goodwill or commercial interests of the Company, or its officers, directors, attorneys, agents and  employees. Nothing in this paragraph is intended to interfere with Executive’s rights under Section 7 of the National  Labor Relations Act.  (e) Entire Agreement. As of the Effective Date, this Agreement constitutes the final, complete and  exclusive agreement between the Executive and the Company with respect to the subject matter hereof, except for  any other equity or additional compensation that exists after the date of execution hereunder.  (f) Amendments; No Waiver. This Agreement may be amended only by an instrument in writing signed  by the parties hereto, and any provision hereof may be waived only by an instrument in writing signed by the party  or parties against whom or which enforcement of such waiver is sought. The failure of any party hereto at any time  to require the performance by any other party hereto of any provision hereof shall in no way affect the full right to  require such performance at any time thereafter, nor shall the waiver by any party hereto of a breach of any  provision hereof be taken or held to be a waiver of any succeeding breach of such provision or a waiver of the  provision itself or a waiver of any other provision of this Agreement.  (g) Choice of Law; Forum Selection. This Agreement and the legal relations thus created between the  parties hereto shall be governed by and construed under and in accordance with the laws of the State of Washington.   Executive agrees that the exclusive forum for any action seeking temporary or preliminary injunctive relief in  accordance with Section 8(b) above shall be the Superior Court of Pierce County, Washington, or the United States  District Court for the Western District of Washington  With respect to any such court action, Executive hereby (i)  irrevocably submits to the personal jurisdiction of such courts; (ii) consents to service of process; (iii) consents to  venue; and (iv) waives any other requirement (whether imposed by statute, rule of court, or otherwise) with respect  to personal jurisdiction, service of process, or venue.  Executive further agrees that such courts are convenient  forums for any dispute that may arise here from and that he shall raise as a defense that such courts are not  convenient forums.  DocuSign Envelope ID: 4619CEDF-68A4-4ED4-A4EE-B9DA5E8720C6 

 

(h) Agreement Negotiated. The parties hereto acknowledge and agree that each party has reviewed and  negotiated the terms and provisions of this Agreement and has had the opportunity to contribute to its revision.  Accordingly, the rule of construction to the effect that ambiguities are resolved against the drafting party shall not be  employed in the interpretation of this Agreement. Rather, the terms of this Agreement shall be construed fairly as to  both parties hereto and not in favor or against either party.    (i) Representations. The parties hereto hereby represent that they each have the authority to enter into  this Agreement, and the Executive hereby represents to the Company that the execution of, and performance of  duties under, this Agreement shall not constitute a breach of or otherwise violate any other agreement to which the  Executive is a party. The Executive hereby further represents to the Company that he will not utilize or disclose any  confidential information obtained by the Executive in connection with any former employment with respect to his  duties and responsibilities hereunder.  (j) Consultation with Counsel. The Executive acknowledges that he has had a full and complete  opportunity to consult with counsel and other advisors of his own choosing concerning the terms, enforceability and  implications of this Agreement, and that the Company has not made any representations or warranties to the  Executive concerning the terms, enforceability or implications of this Agreement other than as reflected in this  Agreement. The Company shall pay directly or reimburse the Executive for all reasonable attorneys’ fees and costs  incurred by the Executive in connection with the negotiation, preparation and execution of this Agreement.  (k) Binding Agreement; Assignment. This Agreement is binding on and is for the benefit of the parties  hereto and their respective successors, assigns, heirs, executors, administrators and other legal representatives.  Neither this Agreement nor any right or obligation hereunder may be assigned by the Executive.  (l) Successors and Assigns. The Company shall require any successor (whether direct or indirect, by  purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company  to assume this Agreement in the same manner and to the same extent that the Company would have been required to  perform it if no such succession had taken place. As used in this Agreement, the “Company” shall mean both the  Company as defined above and any such successor that assumes this Agreement, by operation of law or otherwise.  (m) Severability. Any provision of this Agreement (or portion thereof) which is deemed invalid, illegal  or unenforceable in any jurisdiction shall, as to that jurisdiction and subject to this Section 8(k), be ineffective to the  extent of such invalidity, illegality or unenforceability, without affecting in any way the remaining provisions hereof  in such jurisdiction or rendering any other provisions of this Agreement invalid, illegal, or unenforceable in any  other jurisdiction.  (n) Withholding. The Company may withhold from any amounts payable to the Executive hereunder all  federal, state, city or other taxes that the Company may reasonably determine are required to be withheld pursuant to  any applicable law or regulation (it being understood that the Executive shall be responsible for payment of all taxes  in respect of the payments and benefits provided herein).  (o) Counterparts. This Agreement may be executed in several counterparts, each of which shall be  deemed an original, but all of which shall constitute one and the same instrument. A facsimile or PDF of a signature  shall be deemed to be and have the effect of an original signature.    (p) Headings. The headings in this Agreement are inserted for convenience of reference only and shall  not be a part of or control or affect the meaning of any provision hereof.  [Signature Page Follows]     DocuSign Envelope ID: 4619CEDF-68A4-4ED4-A4EE-B9DA5E8720C6 

 

  IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.     EXECUTIVE:           Lance Brown    COMPANY:    Harbor Custom Development, Inc.    By:             Name:        Title:    DocuSign Envelope ID: 4619CEDF-68A4-4ED4-A4EE-B9DA5E8720C6 COO Jeff Habersetzer 

 

EXHIBIT A  For purposes of this Agreement, the following terms shall have the following meanings:  (a) “Beneficial Owner” shall have the meaning given such term in Rule 13d-3 of the General Rules  and Regulations under the 1934 Act.  (b) “Change in Control” means and includes the occurrence of any of one of the following events:  (i) during any consecutive 12-month period, individuals who, at the beginning of such  period, constitute the Board (the “Incumbent Directors”) cease for any reason to constitute at least a  majority of such Board, provided that any person becoming a director after the beginning of such 12-month  period and whose election or nomination for election was approved by a vote of at least a majority of the  Incumbent Directors then on the Board shall be an Incumbent Director; provided, however, that no  individual initially elected or nominated as a director of the Company as a result of an actual or threatened  election contest with respect to the election or removal of directors (“Election Contest”) or other actual or  threatened solicitation of proxies or consents by or on behalf of any Person other than the Board (“Proxy  Contest”), including by reason of any agreement intended to avoid or settle any Election Contest or Proxy  Contest, shall be deemed an Incumbent Director; or  (ii) any Person becomes a Beneficial Owner, directly or indirectly, of either (A) 50% or more  of the then-outstanding shares of common stock of the Company (“Company Common Stock”) or (B)  securities of the Company representing 50% or more of the combined voting power of the Company’s then  outstanding securities eligible to vote for the election of directors (the “Company Voting  Securities”); provided, however, that for purposes of this subsection (ii), the following acquisitions of  Company Common Stock or Company Voting Securities shall not constitute a Change in Control: (w) an  acquisition directly from the Company, (x) an acquisition by the Company or a Subsidiary, (y) an  acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any  Subsidiary, or (z) an acquisition pursuant to a Non-Qualifying Transaction (as defined in subsection (iii)  below); or  (iii) the consummation of a reorganization, merger, consolidation, statutory share exchange or  similar form of corporate transaction involving the Company or a Subsidiary (a “Reorganization”), or the  sale or other disposition of all or substantially all of the Company’s assets (a “Sale”) or the acquisition of  assets or stock of another corporation or other entity (an “Acquisition”), unless immediately following such  Reorganization, Sale or Acquisition: (A) all or substantially all of the individuals and entities who were the  Beneficial Owners, respectively, of the outstanding Company Common Stock and outstanding Company  Voting Securities immediately prior to such Reorganization, Sale or Acquisition beneficially own, directly  or indirectly, more than 50% of, respectively, the then outstanding shares of common stock and the  combined voting power of the then outstanding voting securities entitled to vote generally in the election of  directors, as the case may be, of the entity resulting from such Reorganization, Sale or Acquisition  (including, without limitation, an entity which as a result of such transaction owns the Company or all or  substantially all of the Company’s assets or stock either directly or through one or more subsidiaries, the  “Surviving Entity”) in substantially the same proportions as their ownership, immediately prior to such  Reorganization, Sale or Acquisition, of the outstanding Company Common Stock and the outstanding  Company Voting Securities, as the case may be, and (B) no Person (other than (x) the Company or any  Subsidiary, (y) the Surviving Entity or its ultimate parent entity, or (z) any employee benefit plan (or  related trust) sponsored or maintained by any of the foregoing is the Beneficial Owner, directly or  indirectly, of 50% or more of the total common stock or 50% or more of the total voting power of the  outstanding voting securities eligible to elect directors of the Surviving Entity, and (C) at least a majority of  the members of the board of directors of the Surviving Entity were Incumbent Directors at the time of the  Board’s approval of the execution of the initial agreement providing for such Reorganization, Sale or  DocuSign Envelope ID: 4619CEDF-68A4-4ED4-A4EE-B9DA5E8720C6 

 

Acquisition (any Reorganization, Sale or Acquisition which satisfies all of the criteria specified in (A), (B)  and (C) above shall be deemed to be a “Non-Qualifying Transaction”); or  (iv) approval by the stockholders of the Company of a complete liquidation or dissolution of  the Company.  (c) “Person” means any individual, entity or group, within the meaning of Section 3(a)(9) of the 1934  Act and as used in Section 13(d)(3) or 14(d)(2) of the 1934 Act.  (d) “Subsidiary” means any corporation, limited liability company, partnership or other entity of  which a majority of the outstanding voting stock or voting power is beneficially owned directly or indirectly by the  Company.  (e) “1934 Act” means the Securities Exchange Act of 1934, as amended from time to time.     DocuSign Envelope ID: 4619CEDF-68A4-4ED4-A4EE-B9DA5E8720C6 

 

  EXHIBIT B  RELEASE AGREEMENT  This RELEASE AGREEMENT (this “Agreement”) is made by and between COMPANY NAME, a Delaware  corporation (the “Company”), and EMPLOYEE NAME (“you” or “Executive”). You and the Company entered into  an Employment Agreement dated as of November XX, 2021 (the “Employment Agreement”). You and the  Company hereby agree as follows:  1) A blank copy of this Agreement was attached to the Employment Agreement as Exhibit B thereto.  2) Termination Payments. If your employment is terminated by the Company without Cause or if you resign  for Good Reason (each, as defined in the Employment Agreement), then, in consideration for your execution,  delivery and non-revocation of this Agreement, following the Release Date (as defined in Section 3 below), the  Company will provide the termination payments and benefits (the “Termination Payments”) to you as provided in  Section 5 of the Employment Agreement.  3) Release by You. In exchange for the payments and other consideration under this Agreement, to which you  would not otherwise be entitled, and except as otherwise set forth in this Agreement, you hereby generally and  completely release, acquit and forever discharge, and covenant not to sue, the Company, and its subsidiaries,  parents, affiliates, predecessors, successors, and assigns, and each such entity’s current and former directors,  managers, partners, members, officers, employees, agents, attorneys, stockholders, successors, and assigns (both  individually and in their official capacities) (collectively, the “Releasees”), of and from any and all claims,  liabilities, demands, causes of action, costs, expenses, attorneys’ fees, damages, indemnities and obligations of every  kind and nature, in law, equity, or otherwise, both known and unknown, suspected and unsuspected, disclosed and  undisclosed, arising out of or in any way related to agreements, events, acts or conduct at any time prior to and  including the execution date of this Agreement, including, but not limited to: all such claims and demands directly  or indirectly arising out of or in any way connected with your employment with the Company or the termination of  that employment; claims or demands related to salary, bonuses, commissions, stock, stock options, or any other  ownership interests in the Company, vacation pay, fringe benefits, expense reimbursements, severance pay, or any  other form of compensation; claims pursuant to any federal, state or local law, statute, or cause of action; tort law; or  contract law. The claims and causes of action you are releasing and waiving in this Agreement include, but are not  limited to, any and all claims and causes of action that any of the Releasees:  (a) has violated its personnel policies, handbooks, contracts of employment, or covenants of good faith and  fair dealing;  (b) has discriminated against you on the basis of age, race, color, sex (including sexual harassment), national  origin, ancestry, disability, religion, sexual orientation, marital status, parental status, source of income,  entitlement to benefits, any union activities or other protected category in violation of any local, state or  federal law, constitution, ordinance, or regulation;  (c) has violated any applicable local, state or federal law, constitution, ordinance, or regulation, including,  without limitation: the Age Discrimination in Employment Act, the Older Workers Benefit Protection  Act, Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 1981, the Americans With Disabilities Act,  the Family and Medical Leave Act, the Genetic Information Nondiscrimination Act, the anti-retaliation  provisions of the Fair Labor Standards Act, the Employee Retirement Income Security Act, the Equal  Pay Act, the Occupational Safety and Health Act, the Worker Adjustment and Retraining Notification  Act, the Employee Polygraph Protection Act, the Fair Credit Reporting Act, the National Labor Relations  Act, or the Uniform Services Employment and Reemployment Rights Act;  (c) has violated any statute, public policy or common law (including, but not limited to claims for retaliatory  discharge; negligent hiring, retention or supervision; defamation; intentional or negligent infliction of  DocuSign Envelope ID: 4619CEDF-68A4-4ED4-A4EE-B9DA5E8720C6 

 

emotional distress and/or mental anguish; intentional interference with contract; negligence; detrimental  reliance; loss of consortium to you or any member of your family and/or promissory estoppel).  Notwithstanding the foregoing, you are not releasing (s) any right of indemnification you may have for any  liabilities arising from your actions within the course and scope of your employment with the Company or within  the course and scope of your role as an officer and/ or director of the Company; (t) any right to receive and to  enforce the Company’s obligation to pay any Termination Payments due and payable to you; (u) any vested benefits  under any Company-sponsored benefit plans; (v) any rights under COBRA or similar state law; (w) any recovery to  which you may be entitled pursuant to workers’ compensation and unemployment insurance laws; (x) your right to  challenge the validity of your release of claims under the ADEA; (y) any rights or claims under federal, state, or  local law that cannot, as a matter of law, be waived by private agreement; or (z) any claims arising after the date on  which Employee executes this Agreement.   You understand that nothing contained in this Release Agreement limits your ability to file a charge or complaint  with the Equal Employment Opportunity Commission, the National Labor Relations Board, the Securities and  Exchange Commission or any other federal, state or local governmental agency or commission (“Government  Agencies”).  You further understand that this Release Agreement does not limit your ability to communicate or  share information with any Government Agencies or otherwise participate in any investigation or proceeding that  may be conducted by any Government Agencies.  However, based on your release of claims set forth above, you  understand that you are releasing all claims and causes of action that you might personally pursue or that might be  pursued in your name and, to the extent permitted by applicable law, your right to recover monetary damages or  obtain injunctive relief that is personal to you in connection with such claims and causes of action.   You acknowledge that you are knowingly and voluntarily waiving and releasing any rights you may have under the  ADEA. You also acknowledge that (i) the consideration given to you in exchange for the waiver and release in this  Agreement is in addition to anything of value to which you were already entitled, and (ii) that you have been paid  for all time worked, have received all the leave, leaves of absence and leave benefits and protections for which you  are eligible, and have not suffered any on-the-job injury for which you have not already filed a claim. You further  acknowledge that you have been advised by this writing that: (a) your waiver and release do not apply to any rights  or claims that may arise after the execution date of this Agreement; (b) you have been advised hereby that you have  the right to consult with an attorney prior to executing this Agreement; (c) you have twenty-one (21) days to  consider this Agreement (although you may choose to voluntarily execute this Agreement earlier); (d) you have  seven (7) days following your execution of this Agreement to revoke the Agreement; and (e) this Agreement shall  not be effective until the date upon which the revocation period has expired unexercised, which shall be the eighth  (8th) day after this Agreement is executed by you provided the Company has also executed the Release on or before  that date (the “Release Date”).    4) Return of Company Property. You represent and warrant that you have fully complied with your  obligations under Section 7(g) of the Employment Agreement.  Receipt of the Termination Payments described  in Section 2 of this Agreement is expressly conditioned upon your full compliance with such obligations.  5) Confidentiality. The provisions of this Agreement will be held in strictest confidence by you and will not be  publicized or disclosed in any manner whatsoever; provided, however, that: (a) you may disclose this Agreement in  confidence to your immediate family; (b) you may disclose this Agreement in confidence to your attorney,  accountant, auditor, tax preparer, and financial advisor; and (c) you may disclose this Agreement insofar as such  disclosure may be required by law.  6) No Admission. This Agreement does not constitute an admission by the Company of any wrongful action  or violation of any federal, state, or local statute, or common law rights, including those relating to the provisions of  any law or statute concerning employment actions, or of any other possible or claimed violation of law or rights.  7) Breach. The Company’s obligation to provide the Termination Payments is expressly conditioned on you  fully complying with your obligations under this Agreement, the Employment Agreement, and any other continuing  contractual obligations you owe to the Company.  In the event that you breach any such obligations, the Company  shall have the right to discontinue all further Termination Payments.  DocuSign Envelope ID: 4619CEDF-68A4-4ED4-A4EE-B9DA5E8720C6 

 

8) Non-Assignment of Claims. You represent and warrant that you have not heretofore assigned or transferred  any matter released by this Agreement or any part or portion thereof. You agree to indemnify and hold harmless the  Company from any claims resulting from any such assignment or transfer by you, or asserted by any assignee or  transferee.  11) Miscellaneous. This Agreement constitutes the complete, final and exclusive embodiment of the entire  agreement between you and the Company with regard to this subject matter, except that your obligations under  Section 7 of the Employment Agreement shall remain in full force and effect in accordance with their terms. It is  entered into without reliance on any promise or representation, written or oral, other than those expressly contained  herein, and it supersedes any other such promises, warranties or representations. This Agreement may not be  modified or amended except in a writing signed by both you and a duly authorized officer of the Company. This  Agreement will bind the heirs, personal representatives, successors and assigns of both you and the Company, and  inure to the benefit of both you and the Company, their heirs, successors and assigns. If any provision of this  Agreement is determined to be invalid or unenforceable, in whole or in part, this determination will not affect any  other provision of this Agreement and the provision in question will be modified by the court so as to be rendered  enforceable. This Agreement will be deemed to have been entered into and will be construed and enforced in  accordance with the laws of the State of Washington as applied to contracts made and performed entirely within  Georgia.     Harbor Custom Development, Inc.                      EXECUTIVE:    By:                    Name:      Lance Brown        Title:          DocuSign Envelope ID: 4619CEDF-68A4-4ED4-A4EE-B9DA5E8720C6

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