Document:

EX-10.31

 Exhibit 10.31 

LEAK-OUT AGREEMENT 

_________ __, 2022 
 This
agreement (the “Leak-Out Agreement”) is being delivered to you in connection with an understanding by and between Palisade Bio, Inc., a Delaware corporation (the “Company”), and the person or persons named on the
signature pages hereto (collectively, the “Holder”). 
 Reference is hereby made to (a) the Underwriting Agreement,
dated __________ __, 2022, by and among the Company and Ladenburg Thalmann & Co. Inc. (“Ladenburg”), as representative of the several underwriters named therein (the “Underwriting Agreement”) in connection
with the follow-on public offering (the “Offering”) by the Company, pursuant to which the Holder and certain other purchasers acquired (i) shares of voting common stock (“Common
Stock”) of the Company (“Shares”), (ii) Series B Convertible Preferred Stock of the Company (the “Preferred Shares”), and (iii) warrants of the Company to purchase Shares (the “Common
Warrants,” and together with the Shares and Preferred Shares, the “Securities”) and (b) the registration statement on Form S-1 (File No. 333-265769) (“Registration
Statement”). Capitalized terms not defined herein shall have the meaning as set forth in the Underwriting Agreement, unless otherwise set forth herein. 

The Holder agrees solely with the Company that from the pricing date of the Offering that the Underwriting Agreement is entered into by and
between the Company and Ladenburg and ending at 4:00 pm (New York City time) on August __, 2022 (such period, the “Restricted Period”), neither the Holder, nor any affiliate of such Holder which (x) had or has knowledge of the
transactions contemplated by the Underwriting Agreement, (y) has or shares discretion relating to such Holder’s investments or trading or information concerning such Holder’s investments, including in respect of the Securities, or
(z) is subject to such Holder’s review or input concerning such affiliate’s investments or trading (together, the “Holder’s Trading Affiliates”), collectively, shall sell, dispose or otherwise transfer, directly
or indirectly, (including, without limitation, any sales, short sales, swaps or any derivative transactions that would be equivalent to any sales or short positions) on any Trading Day during the Restricted Period (any such date, a “Date of
Determination”), shares of Common Stock, or shares of Common Stock underlying any Common Stock Equivalents, held by the Holder on the date hereof, as well as the shares of Common Stock issuable upon conversion of the Preferred Shares and
upon exercise of the Common Warrants, in an amount representing more than ___%1 of the trading volume of Common Stock as reported by Bloomberg, LP on each applicable Date of Determination. 

Notwithstanding anything herein to the contrary, during the Restricted Period, the Holder may, directly or indirectly, sell or transfer all,
or any part, of any “restricted securities” (as defined in Rule 144) to any Person (an “Assignee”) in a transaction which does not need to be reported on the consolidated tape on the Company’s principal Trading
Market, without complying with (or otherwise limited by) the restrictions set forth in this Leak-Out Agreement; provided, that as a condition to any such sale or transfer an authorized signatory of the Company
and such Assignee duly execute and deliver a leak-out agreement in the form of this Leak-Out Agreement (an 

 

	1 	 Pro rata portion of __% among investors executing Leak-Out Agreements,
based on the aggregate amount to be paid by each such investor for the Class A Units and/or Class B Units 

 
“Assignee Agreement”, and each such transfer a “Permitted Transfer”) and, subsequent to a Permitted Transfer, sales of the Holder and the Holder’s Trading
Affiliates and all Assignees (other than any such sales that constitute Permitted Transfers) shall be aggregated for all purposes of this Leak-Out Agreement and Assignee Agreements. 

Any notices, consents, waivers or other communications required or permitted to be given under the terms of this Leak-Out Agreement must be in writing and shall be given to Ladenburg, who subsequently shall deliver such notice, consent, waiver or other communication to the Company or Holder, as applicable. 

This Leak-Out Agreement constitutes the entire agreement among the parties hereto with respect to the
subject matter hereof and supersedes all prior negotiations, letters and understandings relating to the subject matter hereof and are fully binding on the parties hereto. 

This Leak-Out Agreement may be executed simultaneously in any number of counterparts. Each counterpart
shall be deemed to be an original, and all such counterparts shall constitute one and the same instrument. This Leak-Out Agreement may be executed and accepted by facsimile or PDF signature and any such
signature shall be of the same force and effect as an original signature. 
 The terms of this
Leak-Out Agreement shall be binding upon and shall inure to the benefit of each of the parties hereto and their respective successors and assigns. 

This Leak-Out Agreement may not be amended or modified except in writing signed by each of the parties
hereto. 
 All questions concerning the construction, validity, enforcement and interpretation of this
Leak-Out Agreement shall be governed by Sections 7.7 and Section 7.13 of the Underwriting Agreement. 

Each party hereto acknowledges that, in view of the uniqueness of the transactions contemplated by this
Leak-Out Agreement, the other party or parties hereto may not have an adequate remedy at law for money damages in the event that this Leak-Out Agreement has not been
performed in accordance with its terms, and therefore agrees that such other party or parties shall be entitled to seek specific enforcement of the terms hereof in addition to any other remedy it may seek, at law or in equity. 

The obligations of the Holder under this Leak-Out Agreement are several and not joint with the
obligations of any other holder of any of the Securities issued under the Underwriting Agreement (each, an “Other Holder”) or any other holder of any of the Securities issued under the Registration Statement (each, a
“Prospectus Purchaser Other Holder”) pursuant to any other agreement, and the Holder shall not be responsible in any way for the performance of the obligations of any Other Holder or any Prospectus Purchaser Other Holder under any
such other agreement. Nothing contained herein or in this Leak-Out Agreement, and no action taken by the Holder pursuant hereto, shall be deemed to constitute the Holder and Other Holders or any Prospectus
Purchaser Other Holder as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the Holder and the Other Holders or any Prospectus Purchaser Other Holder are in any way acting in concert or as a
group with respect to such obligations or the transactions contemplated by this Leak-Out Agreement and the Company 

 
acknowledges that the Holder and the Other Holders or any Prospectus Purchaser Other Holder are not acting in concert or as a group with respect to such obligations or the transactions
contemplated by this Leak-Out Agreement or any other agreement. The Company and the Holder confirm that the Holder has independently participated in the negotiation of the transactions contemplated hereby with
the advice of its own counsel and advisors. The Holder shall be entitled to independently protect and enforce its rights, including, without limitation, the rights arising out of this Leak-Out Agreement, and
it shall not be necessary for any Other Holder or any Prospectus Purchaser Other Holder to be joined as an additional party in any proceeding for such purpose. 

The Company hereby represents and warrants as of the date hereof and covenants and agrees from and after the date hereof that none of the
terms offered to any Other Holder or any Prospectus Purchaser Other Holder with respect to any restrictions on the sale of Securities substantially in the form of this Leak-Out Agreement (or any amendment,
modification, waiver or release thereof) (each a “Settlement Document”), is or will be more favorable to such Other Holder than those of the Holder and this Leak-Out Agreement. If, and
whenever on or after the date hereof, the Company enters into a Settlement Document with terms that are materially different from this Leak-Out Agreement, then (i) the Company shall provide notice thereof
to the Holder promptly following the occurrence thereof and (ii) the terms and conditions of this Leak-Out Agreement shall be, without any further action by the Holder or the Company, automatically
amended and modified in an economically and legally equivalent manner such that the Holder shall receive the benefit of the more favorable terms and/or conditions (as the case may be) set forth in such Settlement Document, provided that upon written
notice to the Company at any time the Holder may elect not to accept the benefit of any such amended or modified term or condition, in which event the term or condition contained in this Leak-Out Agreement
shall apply to the Holder as it was in effect immediately prior to such amendment or modification as if such amendment or modification never occurred with respect to the Holder. The provisions of this paragraph shall apply similarly and equally to
each Settlement Document. 
 [The remainder of the page is intentionally left blank] 

 The parties hereto have executed this Leak-Out Agreement as of the
date first set forth above. 
  

			
	Sincerely,
	
	PALISADE BIO, INC.
		
	By:	 	  

		 	Name:
		 	Title:

			
	AGREED TO AND ACCEPTED:
	
	“HOLDER”
	
	  

		
	By:	 	  

		 	Name:
		 	Title:EX-10.32

 Exhibit 10.32 
  

 
  
 VIA
E-MAIL DELIVERY 
 _______ __, 2022 

[_____________] 
 [_____________] 

[_____________] 
 [_____________] 

E-mail: [_____________] 
  

	Re:	 Waiver of Variable Rate Transaction 

Ladies and Gentlemen: 
 Reference is made to that certain
Securities Purchase Agreement by and among Leading BioSciences, Inc., Palisade Bio, Inc. (the “Company”) and Altium Growth Fund, LP, dated as of December 16, 2020 (as amended, including by that certain Waiver and
Amendment Agreement, dated as of January 31, 2022, by and among the Company and the holder named therein, the “Primary Financing SPA”) and (ii) Securities Purchase Agreement by and among the Company and the
investors named therein, dated as of May 6, 2022 (the “SPA” and together with the Primary Financing SPA, the “Agreements”). Capitalized terms used herein and not defined shall have the meanings
ascribed to them in the Agreements. 
 Pursuant to Section 4(11)(b) of the SPA, the Company shall be prohibited from entering into a Variable Rate
Transaction until the six (6) month anniversary of the Closing Date (as defined in the SPA). Capitalized terms used herein and not defined shall have the meanings ascribed to them in the Agreements. 

Pursuant to Section 5(t) of the Primary Financing SPA, until the earlier to occur of (x) the date on which no Warrants or Bridge Warrants remain
outstanding and (y) the date that is three (3) years from the Initial Closing Date (as such terms are defined in the Primary Financing SPA), the Company shall be prohibited from effecting or entering into a Variable Rate Transaction (as
defined in the Primary Financing SPA). 
 The Company is considering a public offering (the “Public Offering”), pursuant to a
registration statement on Form S-1 (File. No. 333-265769), as the same may be amended and/or supplemented (the “Registration Statement”),
and the potential sale and issuance of certain securities which such offering may constitute a Variable Rate Transaction (as defined in the Primary Financing SPA) with Ladenburg Thalmann & Co. Inc. acting as sole book-running manager. 

Please indicate your acknowledgement and agreement that the Public Offering shall not be deemed a Variable Rate Transaction for purposes of the Primary
Financing SPA, to the extent you have rights under the Primary Financing SPA, and the SPA, to the extent you have rights under the SPA, that you hereby consent to the Public Offering, and that you waive any required notice provisions associated with
the Primary Financing SPA, to the extent you have rights under the Primary Financing SPA, and the SPA, to the extent you have rights under the SPA (the “Waiver”). Please indicate your acknowledgement and agreement by
executing below and returning to the Company as soon as possible on Monday August 8, 2022. 

  

			
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	CONFIDENTIAL	  	

 

 
  

 Participation Right 

Subject to the receipt of your executed acknowledgement and agreement of the Waiver and timely receipt of an executed notice of acceptance, attached hereto as
Exhibit A (the “Notice of Acceptance”), if commencing on the day after the closing date of the Public Offering and terminating on the one year anniversary of the closing date of the Public Offering (this period, the
“Rights Period”), the Company raises additional capital through the offering for sale for cash of capital stock, or securities convertible, exchangeable or exercisable for capital stock, of the Company (other than
“Excluded Securities” as defined below) (“Offered Securities”), the Company will offer (a) you and (b) each other corporation or partnership to whom a waiver letter substantially in the form
of this letter was addressed and who properly accepts such offer (collectively, the “Participants”), the right to collectively purchase up to an aggregate of fifty percent (50%) of Offered Securities at the same price and
terms being offered, such securities to be allocated among the Participants on a pro rata basis based on the Participants’ ownership of equity securities of the Company (the “Participation Right”). For the avoidance of
doubt, the Participation Right shall not apply to the Public Offering. 
 As used herein, “Excluded Securities” means
(a) shares of common stock, options, or other equity awards to employees, consultants, officers or directors of the Company pursuant to an employee benefit or equity incentive plan which has been approved by the Board of Directors of the
Company pursuant to which the Company’s securities may be issued to any employee, consultant, officer or director, for services provided to the Company, (b) securities (including debt securities) upon the exercise or exchange of or
conversion of any securities and/or other securities exercisable or exchangeable for or convertible into shares of common stock, (c) securities issued pursuant to acquisitions or strategic transactions, (d) securities issued by reason of a
dividend, stock split, split-up or other distribution, and (e) securities sold pursuant to an at-the-market offering
facility. 
 You acknowledge and agree that the offer of the Participation Right herein is in full satisfaction of the Company’s obligations under
Section 5(n)(iii)(1) of the Primary Financing SPA. 
 If you choose to accept the Participation Right, the Company must receive your executed Notice of
Acceptance only between 4:00 p.m. New York City time on the date of pricing of the Public Offering and 6:00 a.m. New York City time following the day of pricing (the “Notice Period”). The Company currently anticipates that
the pricing will occur on August 10 or August 11 but reserves the right to determine the timing of the pricing in its sole discretion. 
 The
Company hereby agrees to publicly disclose on or before 8:30 a.m., New York City time, within four business days following the date hereof, and in no event later than the public disclosure of the closing of the Public Offering, on a Current Report
on Form 8-K or within two business days following the date hereof on a publicly filed Registration Statement on Form S-1, and, in each case, in no event later than the
public disclosure of the closing of the Public Offering (and attaching the form of this Waiver as an exhibit to such filing (including all schedules and attachments), the “Filing”), the transactions as contemplated by this
Waiver in accordance with applicable laws, rules and regulations. Immediately following the filing of the Filing, you or any of your affiliates shall not be in possession of any material, nonpublic information received from the Company, any of its
Subsidiaries or any of its respective officers, directors, affiliates, employees or agents, that is not disclosed in the Filing. In addition, effective upon the filing of the Filing, the Company acknowledges and agrees that any and all
confidentiality or similar obligations under any agreement, whether written or oral, between the Company, any of its Subsidiaries or any of their respective officers, directors, affiliates, employees or agents, on the one hand, and you or any of
your affiliates, on the other hand, shall terminate and be of no further force or effect. The Company understands and confirms that you and your affiliates will rely on the foregoing representations in effecting transactions in securities

  

			
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	CONFIDENTIAL	  	

 

 
  

 
of the Company. The Company shall not disclose the name of the you or any of your affiliates in the Filing without your prior written consent; provided, however, the Company may name you or any
of your affiliates in connection with the transactions contemplated herein in the Registration Statement, including any preliminary prospectus, final prospectus, or prospectus supplement. 

The Company acknowledges and agrees that your decision to execute this Waiver and accept the Participation Right has been made independently of any other
signatory of a waiver letter similar in the form of this letter (the “signatory(ies)”) and independently of any information, materials, statements or opinions as to the business, affairs, operations, assets, properties,
liabilities, results of operations, condition (financial or otherwise) or prospects of the Company or any Subsidiary which may have been made or given by any other signatory or by any agent or employee of any other signatory, and no signatory and
any of its agents or employees shall have any liability to any other signatory (or any other Person) relating to or arising from any such information, materials, statement or opinions. Nothing contained herein or therein, and no action taken by any
signatory pursuant hereto or thereto, shall be deemed to constitute the signatories as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that they are in any way acting in concert or as a group with
respect to such obligations or the transactions contemplated herein. Each signatory acknowledges that no other signatory has acted as agent for such signatory in connection with making the Waiver of a possible investment hereunder. Each signatory
shall be entitled to independently protect and enforce its rights, including without limitation the rights arising out of this Waiver, and it shall not be necessary for any other signatory to be joined as an additional party in any proceeding for
such purpose. Each signatory has been represented by its own separate legal counsel in its review and negotiation of this Waiver. The Company has elected to provide all signatories with a similar Waiver for the convenience of the Company and not
because it was required or requested to do so by any signatory. 
 Very truly yours, 

 

			
	PALISADE BIO, INC.
		
	By:	 	  

	Name:	 	J.D. Finley
	Title:	 	Chief Financial Officer

 Cc: 

 
  

 
 ACKNOWLEDGED AND AGREED: 

[_____________________________] 
  

	
	By: ____________________________
	Name: ____________________________
	Title: ____________________________

  

			
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	CONFIDENTIAL	  	

 

 
  

 Exhibit A 

NOTICE OF ACCEPTANCE 
  

	TO:	 PALISADE BIO, INC. 

Reference is made to that waiver letter dated on or around August 5, 2022 (the “Waiver”). 

The undersigned hereby accepts the Participation Right, subject to the terms of the Waiver. The undersigned acknowledges and agrees that this Notice of
Acceptance shall be null and void ab initio if (i) this Notice of Acceptance is received by the Company prior to or after the Notice Period or (ii) the undersigned has not consented to the Waiver by return a duly executed copy thereof to
the Company. 
 The undersigned hereby agrees that it shall not assign the Participation Right without the Company’s prior written consent. 

The undersigned agrees that notwithstanding the Waiver, the Participation Right shall terminate on the earlier of (i) the termination of the Rights
Period or (ii) immediately prior to the closing of a Change of Control of the Company. As used herein, “Change of Control” means (i) a merger, consolidation or similar transaction involving (directly or indirectly) the Company
and, immediately after the consummation of such merger, consolidation or similar transaction, the stockholders of the Company immediately prior thereto do not own, directly or indirectly, either (A) outstanding voting securities representing
more than 50% of the combined outstanding voting power of the surviving entity in such merger, consolidation or similar transaction or (B) more than 50% of the combined outstanding voting power of the parent of the surviving entity in such
merger, consolidation or similar transaction, in each case in substantially the same proportions as their ownership of the outstanding voting securities of the Company immediately prior to such transaction; or (ii) a sale, lease, exclusive
license or other disposition of all or substantially all of the consolidated assets of the Company and its subsidiaries, other than a sale, lease, license or other disposition of all or substantially all of the consolidated assets of the Company and
its subsidiaries to an entity, more than 50% of the combined voting power of the voting securities of which are owned by stockholders of the Company. 

[_____________________________] 
  

	
	By: ____________________________
	Name: ____________________________
	Title: ____________________________

  

			
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	CONFIDENTIAL

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