Document:

ex_235167.htm

Exhibit 10.1

 

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into, effective as of the 15th day of March, 2021 (the “Effective Date”), by and between Jeffrey Brown (hereinafter referred to as the “Executive”), and US Alliance Corporation, a Kansas corporation (hereinafter referred to as the “Employer”).

 

WHEREAS, the Employer is a financial services holding company with its headquarters in Topeka, Kansas;

 

WHEREAS, US Alliance Life and Security Company, a Kansas corporation and the wholly owned subsidiary of the Employer (“USALSC”) is a life insurance company engaged in providing quality products and services, with its headquarters in Topeka, Kansas;

 

WHEREAS, Dakota Capital Life Insurance Company, a North Dakota corporation and a wholly owned subsidiary of USALSC (“DCL”) is a life insurance company engaged in providing quality products and services;

 

WHEREAS, US Alliance Life and Security Company - Montana, a Montana corporation and a wholly owned subsidiary of USALSC (“USALSC-Montana”) is a life insurance company engaged in providing quality products and services;

 

WHEREAS, the Executive has experience as an executive of financial services holding companies and life insurance companies;

 

WHEREAS, the Employer desires to employ the Executive and to appoint the Executive as the Vice President and Principal Financial Officer of Employer on the terms and conditions hereinafter set forth;

 

WHEREAS, the Employer desires to employ the Executive and to appoint the Executive to USALSC as the Executive Vice President and Chief Operating Officer of USALSC on the terms and conditions hereinafter set forth;

 

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WHEREAS, the Employer desires to employ the Executive and to appoint the Executive to DCL as the President and Chief Operating Officer of DCL on the terms and conditions hereinafter set forth;

 

WHEREAS, the Employer desires to employ the Executive and to appoint the Executive to USALSC-Montana as the President and Chief Operating Officer of USALSC-Montana on the terms and conditions hereinafter set forth;

 

WHEREAS, the Executive desires to accept employment with the Employer as Vice President and Principal Financial Officer, as the Executive Vice President and Chief Operating Officer of USALSC, as the President of DCL, and as the President of USALSC-Montana on the terms and conditions hereinafter set forth.

 

W I T N E S S E T H

 

NOW, THEREFORE, the parties, in consideration of their respective promises and undertakings as herein set forth, agree as follows:

 

1.             Employment.  Subject to the terms and conditions hereinafter set forth, the Employer hereby employs the Executive, and the Executive hereby accepts employment with the Employer to act on the Employer’s behalf, as the Vice President and Principal Financial Officer, as the Executive Vice President and Chief Operating Officer of USALSC, as President of DCL, and as President of USALSC-Montana.

 

2.             Duties.  In exchange for the compensation and benefits granted under this Agreement, Executive shall, to the best of his ability, faithfully and diligently render full-time services to Employer in the position of , respectively, Vice President, Principal Financial Officer, Executive Vice President, Chief Operating Officer and President. Executive shall perform all duties that are consistent with these positions, all duties and responsibilities specified in the Articles of Incorporation and Bylaws of the Employer, USALSC, DCL, and USALSC-Montana, as the same may be amended from time to time, and such other duties and responsibilities as may be specified by the Boards of Directors of the Employer, USALSC, DCL and USALSC-Montana and the Chief Executive Officer of the Employer.  The Executive shall report to the Chief Executive Officer of the Employer for the performance of his duties and shall devote substantially all of his working time, attention, skill and reasonable best efforts to the performance of his duties hereunder in a manner that will faithfully and diligently further the business and interests of the Employer (and their subsidiaries and affiliates).

 

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3.             Compensation for Services.  In consideration for the services rendered to the Employer, the Executive shall be compensated as follows:

 

A.            Base Salary.  The Executive shall be compensated at the rate of $210,000 per year (“Base Salary”).  The Executive’s Base Salary, subject to applicable withholding and authorized deductions, shall be paid in equal installments, in accordance with the usual and customary payroll practices of the Employer.   In the event of the resignation, dismissal, disability or death of the Employer’s current President and CEO (Jack H. Brier), the Executive’s Base Salary will increase to the prior year’s W-2 earnings of the Executive.

 

B.             Bonus.  The Board of Directors or the Chief Executive Officer of the Employer may, in its discretion, grant performance bonuses to the Executive, in addition to the compensation described herein, based on performance relating to events such as, but not limited to, acquisitions, establishment of subsidiaries or affiliates, expansion of the Employer, or corporate revenues or profits. A schedule of bonus opportunities shall be provided to the Executive by February 1st each calendar year. Bonus payments are subject to the following executive claw back policy:

 

This Policy applies whenever (1) there is a restatement (as that term is defined by generally accepted accounting principles) that results in a revision to one or more performance measures used to determine a bonus or incentive or equity-based compensation paid or awarded to an employee during the period(s) to which the restatement relates, (2) the relevant period commenced not more than three years before the need for the restatement is identified, (3) the restatement results in a reduction in the amount or value of the bonus or incentive or equity-based compensation and (4) the restatement is caused, in whole or in part, by the employee’s actions.

 

Unless the Sarbanes-Oxley Act precludes the exercise of discretion, the Executive Committee in its discretion may require repayment and forfeiture of all or a portion of a bonus or incentive or equity-based compensation to which this policy applies which was awarded to or received or earned by an employee to the extent the bonus or incentive or equity-based compensation exceeds the amount that would have been awarded, received, or earned based on the revised performance measures. The Executive Committee shall determine the amount or value to be repaid and forfeited in its sole discretion.

 

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C.            Benefits.  During the term of this Agreement, subject to the final paragraph of this Section 3.C, the Executive shall receive the following benefits (together, the “Other Benefits”):

 

(i)           The Executive will be entitled to participate in all incentive, retirement, profit-sharing, life, medical, disability and other benefit plans and programs as are from time to time generally available to other executives of the Company with comparable responsibilities, subject to the provisions of those programs.  Without limiting the generality of the foregoing, the Company will provide the Employee with basic health and medical benefits on the terms that such benefits are provided to other team members of the Employer with comparable responsibilities. 

 

(ii)          The Employer will reimburse Executive $100 per month for a cell phone and related service for business purposes and shall provide reasonable items the Executive deems necessary in the performance of his duties.

 

(iii)         The Executive shall be eligible to participate in all leave policies and “fringe” benefit programs, including, but not limited to, sick leave, personal leave, insurance programs and pension and/or profit sharing plans, as and to the extent the same are from time to time made available to employees of the Employer.

 

(iv)         The Employer shall pay the Executive’s annual Society of Actuaries and American Academy of Actuaries dues.

 

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(v)         The Employer shall pay for the Executive to attend two professional development conferences each calendar year. Employer shall pay for the cost of the conference, transportation, lodging, and meals for the Executive and Executive’s spouse.          

 

Anything herein to the contrary notwithstanding, however, the Executive’s eligibility, participation and benefit entitlement for each of the foregoing policies, plans, programs or benefits shall be subject to all of the terms and conditions of each such policy, plan or program and any third party contracts, agreements or policies of insurance which may be applicable thereto; and the Employer expressly reserves the right, either with or without notice, to terminate, curtail or otherwise modify, change, amend or modify any such policy, plan or program in whole or in part on a prospective basis at any time.

 

D.            Continuation of Salary During Illness.  If the Executive shall become ill or temporarily disabled and shall be absent from work by reason thereof, the Employer shall continue the Executive’s salary during said period of illness or disability as may be necessary to permit the Executive to qualify for any long-term disability income insurance maintained by the Executive.

 

E.             Annual Physical.  On or prior to August 1 of each year, at the Employer’s expense, the Executive shall obtain a physical examination. The scope of such physical examination shall be of a type and nature similar to medical examinations required of key executives in similar businesses from time to time, and shall be determined in the reasonable discretion of the Employer.

 

4.             Expense Reimbursement.  The Employer agrees to reimburse the Executive, in accordance with the Employer’s usual and customary practices, for all ordinary and necessary business expenses which are reasonably and necessarily incurred by the Executive in the course of performing his duties on the Employer’s behalf under this Agreement.

 

5.             Term.  Subject to the remaining provisions of this Section 5, the term of this Agreement shall be a period of three (3) years, commencing on the Effective Date and continuing until March 14, 2024 (the “Termination Date”).  Prior to each anniversary of the Effective Date, or within 30 days thereafter, the Employer’s Board of Directors shall consider and vote upon a proposal to renew and extend the term of this Agreement.  Such consideration and vote shall occur at a duly called meeting of the Board of Directors at which a quorum is present.  If a majority of the members of the Board of Directors present at such meeting votes in favor of renewal, and if the Executive does not object to such renewal, the term of this Agreement shall automatically be extended for a period of one (1) year and the Termination Date likewise shall be deferred by one (1) year.  Thus, by way of example:

 

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(i)            If the Board of Directors approves a renewal pursuant to this Section 5 prior to the first anniversary of the Effective Date or within 30 days thereafter, and if the Executive does not object, the term of this Agreement shall run through March 14, 2025, and March 14, 2025 shall become the Termination Date.

 

(ii)           If the Board of Directors does not approve a renewal pursuant to this Section 5 prior to the Effective Date or within 30 days thereafter, or if the Executive objects to the renewal, the term of this Agreement shall continue to run through March 14, 2024, and March 14, 2024 shall remain the Termination Date.

 

(iii)          If, after approving the first renewal as provided in subsection (i) above, the Board of Directors approves a second renewal pursuant to this Section 5 prior to the second anniversary of the Effective Date or within 30 days thereafter, and if the Executive does not object, the term of this Agreement shall run through March 14, 2026, and March 14, 2026 shall become the Termination Date.

 

(iv)          If, after approving the first renewal as provided in subsection (i) above, the Board of Directors does not approve a second renewal pursuant to this Section 5 prior to the second anniversary of the Effective Date or within 30 days thereafter, or the Executive objects to the second renewal, the term of this Agreement shall continue run through March 14, 2025, and March 14, 2025 shall remain the Termination Date.

 

Additional renewals of this Agreement shall continue to be considered and voted upon by the Employer’s Board of Directors in a like manner and with a like effect in subsequent years on an annual basis in accordance with this Section 5.  The period between the Effective Date and the Termination Date, as determined and extended pursuant to this Section 5, is hereinafter referred to as the “Term” of this Agreement.

 

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6.            Termination.  This Agreement may be terminated as follows:

 

A.            Expiration of the Term.  This Agreement shall automatically terminate upon expiration of the Term of this Agreement or may be extended pursuant to Section 5.

 

B.            Death.  This Agreement shall immediately terminate upon the event of the Executive’s death.

 

C.            Disability.  Subject to Section 3.D, this Agreement shall immediately terminate in the event the Executive is Permanently Disabled, has exhausted all available leave, and is unable to return to work and perform the essential functions of his employment. “Permanently Disabled” shall mean a physical or mental impairment rendering the Executive substantially unable to carry out his then currently assigned day-to-day functions as an employee of the Employer for any period of six (6) consecutive months.  Any dispute as to whether the Executive is Permanently Disabled, and the date on which such incapacity commenced shall be resolved by the Board of Directors with the assistance of a physician selected by the Employer.  The decision of the Board of Directors shall be final and binding upon the Executive and the Employer.  If the Executive does not cooperate in providing the Board of Directors access to needed information upon which a determination can be made, then the Board of Directors shall have no continued obligation to consult with a physician and will have authority to determine incapacity on its own.

 

D.            Involuntary Termination for Good Cause.  The Employer may terminate the Executive’s employment at any time during the Term of this Agreement for Good Cause.  “Good Cause” shall be deemed to exist if, and only if:

 

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(i)            Executive willfully engages in an act or omission constituting dishonesty, breach of fiduciary duty or intentional wrongdoing or malfeasance, including without limitation knowing falsification of the financial books or records of the Employer (or its subsidiaries or affiliates), embezzlement of funds from the Employer (or its subsidiaries or affiliates) or other similar fraud; provided, however, that a breach of fiduciary duty shall not be deemed to occur or exist as a result of any business decision made by Executive that is protected by the “business judgment rule” as adopted by courts applying the General Corporation Law of the State of Kansas;

 

(ii)           Executive is indicted for, is charged by information for, is convicted of, or enters a plea of guilty or nolo contendere to a crime involving fraud, dishonesty, or harassment;

 

(iii)          Executive is indicted for, is charged by information for, is convicted of, or enters a plea of guilty or nolo contendere to a felony or other crime which has or may have a material adverse effect on Executive’s ability to carry out his duties under this Agreement or reflect adversely on the reputation, interests, or activities of the Employer (or its subsidiaries or affiliates) or its policyholders;

 

(iv)          Executive habitually abuses alcohol, illegal drugs or controlled substances or non-prescribed prescription medicine;

 

(v)           Executive materially breaches the terms of any agreement between Executive and the Employer (or its subsidiaries or affiliates) relating to Executive’s employment, or materially fails to satisfy the conditions and requirements of Executive’s employment with the Employer (or its subsidiaries or affiliates), and such breach or failure remains uncured for more than 60 days following receipt by Executive of written notice from the Employer specifying the nature of the breach or failure and demanding cure thereof; or

 

(vi)          Executive engages in acts or omissions constituting gross negligence by Executive in the performance (or non-performance) of his duties hereunder.

 

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7.             Effect of Termination.  In the event the Executive’s employment is terminated pursuant to Section 6.A, 6.B, 6.C or 6.D above, the Executive shall only be entitled to receive that portion of his Base Salary which has been earned up to the date of such termination, in addition to Other Benefits through the date of such termination and the reimbursement of any expenses as provided in Section 4.  In the event the Executive’s employment is terminated by the employer for a reason other than those provided in Section 6.A, 6.B., 6.C. or 6.D, the Executive shall be entitled to the amounts set forth in Section 9 below.

 

8.             Resignation or Retirement; Effect.  If the Executive resigns without Good Reason (as defined below) or retires during the Term of this Agreement, the Executive shall only receive his Base Salary and Other Benefits through the effective date of his resignation or retirement. If the Executive resigns with Good Reason, he shall be entitled to the amounts set forth in Section 9 below.  For purposes of this Agreement, “Good Reason” shall mean:

 

(i)            the assignment to the Executive of any duties inconsistent in any respect with the Executive’s position (including status, offices, titles and reporting requirements), authority, duties or responsibilities as contemplated by Sections 1 and 2 of this Agreement, or any other action by the Employer, USALSC, DCL or USALSC-Montana which results in a diminution in such position, authority, duties or responsibilities, including a change in the reporting relationship of Executive to the Chief Executive Officer of the Employer which has that effect, but excluding for this purpose an isolated, insubstantial and inadvertent action not taken in bad faith and which is remedied by the Employer, USALSC, DCL or USALSC-Montana promptly after receipt of notice thereof given by the Executive;

 

(ii)           any failure by the Employer to comply with any of the provisions of Section 3 of this Agreement, other than an isolated, insubstantial and inadvertent failure not occurring in bad faith and which is remedied by the Employer promptly after receipt of notice thereof given by the Executive;

 

(iii)          the Employer requiring the Executive to be based at any office or location other than Topeka, Kansas without the Executive’s consent;

 

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(iv)          any purported termination by the Employer of the Executive’s employment otherwise than as expressly permitted by this Agreement;

 

(v)           any failure by the Employer’s Board of Directors to consider and vote upon a proposal to renew and extend the Term of this Agreement on an annual basis in accordance with Section 5; provided, however, that the failure of the Board of Directors to vote in favor of renewal and extension shall not constitute Good Reason as long as the renewal and extension were considered, and a vote taken;

 

(vi)          resignation by the Executive for any reason within three (3) months after a Change in Control.  As used herein, “Change in Control” means:

 

(a)           the acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934 (the “Exchange Act”)), other than an employee benefit plan (or related trust) sponsored or maintained by the Employer or any of its affiliates, of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of more than twenty-five percent (25%) of the then outstanding voting securities of the Employer or USALSC entitled to vote generally in the election of directors, or of equity securities having a value equal to more than twenty-five percent (25%) of the total value of all shares of stock of the Employer or USALSC;

 

(b)           individuals who as of the effective date of this Agreement constitute the Board of Directors and subsequently elected members of the Board of Directors of the Employer whose election is approved or recommended by at least a majority of such current members or their successors whose election was so approved or recommended, cease for any reason to constitute at least a majority of the Board of Directors of the Employer; or

 

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(c)            approval by the shareholders of the Employer of (1) a merger, reorganization or consolidation with respect to which the individuals and entities who were the respective beneficial owners of the voting securities of the Employer immediately before such merger, reorganization or consolidation do not, after such merger, reorganization or consolidation, beneficially own, directly or indirectly, more than fifty percent (50%) of respectively, the then outstanding common shares or other voting securities and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of Directors of the corporation or limited liability company resulting from such merger, reorganization or consolidation, (2) a liquidation or dissolution of the Employer or (3) the sale or other disposition of all or substantially all of the assets or stock of USALSC by the Employer.

 

(vii)          resignation by the Executive after three (3) months, but before six (6) months, after a Change in Leadership if the reason for the resignation is that irreconcilable differences exist between the Executive and the new leadership.  As used herein, “Change in Leadership” means that a person other the Executive is appointed to replace Jack H. Brier as President and Chief Executive Officer of the Employer to whom the Executive reports after the Change in Leadership.

 

(viii)         the Employer, USALSC, DCL or USALSC-Montana materially breaches the terms of any agreement between the Executive and the Employer, USALSC, DCL or USALSC-Montana relating to the Executive’s employment, or materially fails to satisfy the conditions and requirements of this Agreement, and such breach or failure by its nature is incapable of being cured, or such breach or failure remains uncured for more than 30 days following receipt by the Employer of written notice from  the Executive specifying the nature of the breach or failure and demanding the cure thereof.

 

Notwithstanding anything herein to the contrary, in the event the Executive shall resign and terminate his employment for Good Reason hereunder, the Executive shall give written notice to the Employer specifying in detail the reason or reasons for the Executive’s termination.

 

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9.            Severance; Liquidated Damages.  If the Employer terminates the Executive’s employment under this Agreement during the Term for a reason other than those provided in Sections 6.A, 6.B, 6.C and 6.D, or if the Executive resigns and terminates this Agreement for Good Reason as provided in Section 8, the Employer shall pay to the Executive that portion of his Base Salary which has been earned up to the date of such termination, in addition to Other Benefits through the date of such termination and the reimbursement of any expenses as provided in Section 4.  In addition, in any such event, the Employer shall (i) pay to the Executive within 30 days following the date of such termination an amount equal to the Executive’s highest full year W-2 earnings from the previous three years (the “Liquidated Damages Amount”) and (ii) continue to provide the Executive with the Other Benefits for a period of twelve (12) months. The Employer and the Executive agree that the Executive shall have no duty to mitigate his losses or obtain other employment.  If the Executive obtains other employment, it shall not affect his right to payment under this Section. The parties have bargained for and agreed to the foregoing severance and liquidated damages provision, given consideration to the fact that the Executive will lose certain benefits related to his position, which are extremely difficult to determine with certainty.  The parties agree that payment of the severance liquidated damages provided in this Section to the Executive shall constitute adequate and reasonable compensation to the Executive for the damages and injury suffered by him because of such termination of this Agreement by the Employer for a reason other than those provided in Sections 6.A, 6.B, 6.C and 6.D or by the Executive with Good Reason.

 

10.         Arbitration (a) Any disputes arising under or in connection with this agreement shall be resolved by arbitration, to be held in Topeka, Kansas in accordance with the rules and procedures of the American Arbitration Association and the State of Kansas. (b) All costs, fees and expenses, including attorney’s fees of both Employee and Employer, of any arbitration in connection with this agreement which results in any decision or settlement requiring Employer to make a payment to Executive, shall be borne by, and be the obligation of, Employer. In no event shall Executive be required to reimburse Employer for any of the costs and expenses incurred by Employer relating to such arbitration. The obligation of Employer under this section shall survive the termination of this agreement (whether such termination is by Employer, by Executive, upon the expiration of this agreement or otherwise). (c) Pending the outcome or resolution of any arbitration, Employer shall continue payment of all amounts owing to Executive without regard to any dispute.

 

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11.           Confidentiality/Nondisclosure.  The Executive agrees that all information relating to the Employer and its business, financial and/or professional affairs which is obtained by the Executive in the course of his employment has substantial value and shall at all times be and remain the sole and exclusive property of the Employer.  Executive further agrees during the term of this Agreement and thereafter, to maintain and keep all Confidential Information, as hereinafter defined, strictly confidential and to not disclose the same in any form to any person, firm or entity, or use the same for any purpose whatsoever except as may be necessary and appropriate in connection with the performance of the Executive’s duties hereunder, or to the extent such disclosures are required by law.  For the purposes of this Agreement, “Confidential Information” shall include, but not be limited to, all nonpublic information pertaining to or in any way connected with the Employer’s present or future products or services or any component parts thereof, the Employer’s designs, routines, standards, and procedures, all research, development, discoveries, improvements, applications, enhancements, and inventions, whether or not patentable or subject to copyright protection, undertaken or made in connection therewith; all information relating to the Employer’s customers, clients and accounts, and contractees, and all information related to executives, executive relations, personnel or pay practices, marketing plans, business plans, business or marketing research; and all information relating to the Employer’s financial and/or other business affairs; and all files, documents, contracts, materials, listings, computer programs, printouts, source codes, drawings, specifications, processes, applications, techniques, routines, formulas and information of every name, nature or description, whether or not the same is in machine readable form or reduced to writing, which pertains thereto.

 

All records, files, lists, including computer generated lists, drawings, documents, equipment and similar items relating to the Employer’s business which Executive shall prepare or receive from the Employer shall remain the Employer’s sole and exclusive property. Upon termination of this agreement, Executive shall promptly return to the Employer all property of the Employer in his possession. Executive shall not copy or cause to be copied, print out or cause to be printed out any software, documents or other materials originating with or belonging to the Employer. Executive additionally represents that, upon termination of his employment with Employer, he will not retain in his possession any such software, computers, passwords, documents or other materials.

 

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Executive agrees that both during and after his employment he shall, at the request of the Employer, render all assistance and perform all lawful acts that the Employer considers necessary or advisable in connection with any litigation involving the Employer or any director, officer, employee, shareholder, agent, representative, consultant, client or vendor of the Employer.

 

12.        Noncompete Covenant.  Executive agrees that for a period of one year following the termination of this Agreement he will not (1) solicit any shareholder, policyholder, or employee of Employer, to become a shareholder or policyholder of any competitor or anticipated competitor of the Employer; or (2) solicit any employee, agent, or independent contractor of Employer to become an employee, agent or independent contractor of any competitor or anticipated competitor of the Employer.

 

Executive agrees to deliver promptly to Employer on termination of the Executive's employment by the Employer or the Executive, or at any time Employer may so request, all memoranda, notes, records, reports, and other documents (and all copies thereof) relating to Employer's and its affiliates' businesses which the Executive may then possess or have under his control. Notwithstanding the foregoing, the Executive may retain his contacts, calendar, personal correspondence and any compensation information or other information necessary for tax return purposes.

 

13.           Remedies in the Event of Breach; Specific Performance.  The parties acknowledge that the Employer’s remedies at law for breach of the covenants contained in Sections 11 and 12 hereof by the Executive are inadequate, that irreparable harm is likely to result in the event of a breach of such covenants and that monetary damage alone will not compensate for such damage. Therefore, the Executive waives any and all defenses that an adequate remedy at law exists in the event of any action by the Employer to enforce any one or more of the covenants set forth in Sections 11 and 12 hereof, and the Executive agrees that the Employer shall be entitled to injunctive relief, as well as such other relief as may be available at law or in equity, including, but not limited to, specific performance and/or damages to the extent the same can be quantified and proven.

 

14.           Severability.  Invalidity of any provision of this Agreement including, but not by way of limitation, any provision of Sections 8, 10, 11, or 12 hereof shall not render invalid any of the other provisions of this Agreement (including, but not by way of limitation, any of the other provisions of said sections and/or of said specifically enumerated subsections).

 

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15.           Miscellaneous Provisions.

 

A.            Successor and Assigns.  This Agreement is personal in nature and the Executive may not assign or delegate any rights or obligations hereunder without first obtaining the express written consent of the Employer.  The rights, benefits, and obligations of the Employer under this Agreement and all covenants and agreements pertaining thereto hereunder shall be assignable by the Employer and shall inure to the benefit of and be enforceable by or against its successors and assigns, provided the Employer shall remain liable to the Executive for the performance of all obligations to be performed by it hereunder.

 

B.            Entire Agreement.  This Agreement contains the entire agreement of the parties with respect to the subject matter hereof and supersedes and replaces all prior agreements or understandings and all negotiations, discussions, arrangements, and understandings with respect thereto.

 

C.            Binding Effect.  This Agreement shall be binding upon the parties and their respective heirs, personal representatives, administrators, trustees, successors, and permitted assigns.

 

D.            Amendment or Modification.  No amendment or modification of this Agreement shall be binding unless executed in writing by the parties hereto.

 

E.             Kansas law.  Employer and Executive agree that this Agreement shall be governed by and construed according to the laws of the State of Kansas.

 

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F.             Interpretations.  Any uncertainty or ambiguity existing herein shall not be interpreted against either party because such party prepared any portion of this Agreement, but shall be interpreted according to the application of rules of interpretation of contracts generally.  The headings used in this Agreement are inserted for convenience and reference only and are not intended to be an integral part of or to affect the meaning or interpretation of this Agreement.

 

G.            Notices.  Any notice required to be given in writing by any party to this Agreement may be delivered personally or by certified mail.  Any such notice directed to the Employer shall be addressed to the Employer at PO Box 4026, Topeka, KS 66604, Attention: Chairman, Board of Directors; or to such other address as the Employer may from time to time designate in writing to the Executive.  Any notice addressed to the Executive shall be addressed to his personal residence at 3720 SW Cobblestone Pl, Topeka, KS 66610 or to such other address as the Executive may from time to time designate in writing to the Employer.

 

H.            Survival.  Anything herein to the contrary notwithstanding, the rights and obligations of the parties hereunder which by their terms contemplate or require performance or obligations which extend beyond or occur after the termination of this Agreement, specifically including, but not limited to, the payments to the Executive provided for in Sections 7 and 9, the indemnification of Executive provided in Section 10, the use of Confidential Information set forth in Section 11, and the Noncompete Covenant set forth in Section 12 shall survive

termination of this Agreement and shall be and remain fully enforceable as between the parties in accordance with their terms.

 

I.              Voluntary Execution.  Each of the Executive and the Employer is signing this Agreement knowingly and voluntarily.  The Executive and the Employer have been given the opportunity to consult with independent counsel of their choice regarding their rights under this Agreement. 

 

J.             Signatures.  This Agreement may be executed in counterparts, both of which shall be one and the same Agreement.

 

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IN WITNESS WHEREOF, the Employer and the Executive have caused this Agreement to be signed, effective as of the date and year first above written, fully intending the same to be binding upon themselves and their respective heirs, personal representatives, trustees, successors, receivers and assigns.

 

	 	
			US Alliance Corporation

			
	 	 
	 	 
	 	
			By:

				
			 /s/ Jack H. Brier

			
	 	 	
			Jack H. Brier, Chairman

			
	 	 
	 	 
	 	
			EXECUTIVE

			
	 	 
	 	 
	 	
			By:

				
			 /s/ Jeffrey Brown

			
	 	 	
			Jeffrey Brown

			

 

 

17Exhibit 10.01

 

 

SEPARATION AGREEMENT

 

This Separation Agreement
(“Agreement”) is made and entered into as of March 17, 2021 by and between Seneca Biopharma, Inc. (the “Company”)
and [*] (“Employee”). The Company and Employee are collectively referred to as the “Parties"
and each a “Party”. Any term used but not defined herein will have the meaning ascribed to it in the Employment
Agreement (as defined below).

 

RECITALS

 

WHEREAS, Employee
has been employed by the Company pursuant to the terms of that certain employment agreement effective April 1, 2020 (“Employment
Agreement”);

 

WHEREAS, the
Company has entered into an agreement and plan of merger with Leading BioSciences, Inc. (“LBS”) dated December
16, 2020 (“Merger Agreement”) whereby the Company and LBS anticipate consummating a merger of the two companies
(the “Merger”);

 

WHEREAS, simultaneously
with the execution and delivery of this Agreement, or at such time as mutually agreed to between the Parties, but in no event later
than the consummation of the Merger, the Company shall cause to be deposited into an escrow (“Escrow”), any
amounts payable under this Agreement that could trigger taxation under Section 409A of the Code (as defined below);

 

WHEREAS, in
anticipation of the transactions contemplated by the Merger Agreement, the Company will be terminating Employee’s employment
without Cause; and

 

WHEREAS, the
Parties wish to acknowledge and memorialize the pre-existing obligations of the Parties as contained in the Employment Agreement.

 

NOW THEREFORE,
in consideration of the mutual promises made herein, the Parties hereby agree as follows:

 

AGREEMENT

 

1.       Separation
Date. Employee’s employment with the Company is hereby terminated without Cause effective March 17, 2021 (the “Separation
Date”).

 

2.       Consideration.
If Employee: (i) signs and returns this Agreement to the Company on or within forty-five (45) days after the Separation Date; (ii)
allows the releases contained herein to become effective; and (iii) complies with all of Employee’s legal and contractual
obligations to the Company, then in full satisfaction of the Company’s obligations under the Employment Agreement, the Company
will provide Employee with the following severance benefits (the “Severance Benefits”):

 

2.1    
Accrued Obligations. The Company will pay Employee the Accrued Obligations in an amount equal to $[*], subject to standard
payroll deductions and withholdings. The payments due under this Section 2.1 will be paid by the Company in a lump-sum cash payment
no later than the fifth (5th) business day after the Separation Date, except that the Accrued Obligations (or any portion
thereof) shall be paid earlier if and to the extent so required in accordance with the provisions of applicable law.

 

2.2    Severance
Benefits. The Company will pay Employee the Severance Benefits in an amount equal to $[*], subject to standard payroll deductions
and withholdings. The payments due under this Section 2.2 will be paid by the Company in a lump-sum cash payment no later
than the fifth (5th) business day after the later to occur of the Separation Date or the end of the Revocation Period
(as defined in Section 4 below); provided, however, that if any portion of such amount may not be paid at such time without
triggering taxation under Section 409A of the Internal Revenue Code of 1986, as amended, and the regulations and guidance promulgated
thereunder (the “Code”), such portion shall be paid on the first date(s) that payment is permissible without
triggering such taxation, pursuant to the terms of the Escrow.

    	 	1	 

     

    

2.3    Accelerated
Equity Benefit. If, but only if, the Merger is consummated, then, notwithstanding any provision of the Employment Agreement,
the Inducement Plan, the Option Agreement or any other applicable equity incentive plan or equity award agreement or other agreement
to the contrary, the vesting and exercisability of the Option Award and all other outstanding unvested equity awards granted or
issued to Employee by the Company shall not be accelerated. If, but only if, the Merger is not consummated, then, effective as
of the Separation Date, the Employee shall be entitled to the Accelerated Equity Benefit pursuant to, and in accordance with, the
terms of the Employment Agreement, and, for purposes of implementing the foregoing provisions of this sentence, Employee’s
employment with the Company shall be deemed and treated as having been terminated by the Company without Cause and the releases
granted by Employee pursuant to Section 3 of this Agreement shall be deemed and treated as satisfying the requirement and condition
set forth in the Employment Agreement that Employee execute and deliver the Release of Claims.

 

2.4       Change
of Control. The Company will pay an additional $[*] (subject to standard payroll deductions and withholdings) to Employee immediately
prior to the closing of the Merger or, if the Merger Agreement is terminated and the Merger is not consummated, immediately prior
to the closing of any other Change of Control pursuant to a definitive agreement that is entered into at any time prior to December
31, 2021, irrespective of the actual date that the Merger or any such other Change of Control closes or occurs; provided, however,
that if any portion of such amount may not be paid at such time without triggering taxation under Section 409A of the Code, such
portion shall be paid on the first date(s) that payment is permissible without triggering such taxation, pursuant to the terms
of the Escrow. The definition of Change of Control in Section 1(k) of the Employment Agreement is hereby amended and modified by
replacing both instances of the words “twenty percent (20%)” with the words “thirty percent (30%)” in subparagraph
(1) of such definition. From and after the date of this Agreement, the term Change of Control, as used in the Employment Agreement
and in this Agreement, shall have the meaning set forth in the Employment Agreement after giving effect to the amendment and modification
of the definition of such term in accordance with the provisions of the immediately preceding sentence.

 

2.5       Cancelation
of Equity Grants. Immediately prior to the closing of the Merger, the Company will pay Employee $[*] (subject to standard payroll
deductions and withholding) as consideration for the cancelation of any and all equity awards granted or issued to Employee by
the Company, including, without limitation, the Option Award; provided, however, that if any portion of such amount may
not be paid at such time without triggering taxation under Section 409A of the Code, such portion shall be paid on the first date(s)
that payment is permissible without triggering such taxation, pursuant to the terms of the Escrow.

 

2.6    Treatment
of Equity Awards if Merger is not Consummated. If the Merger is not consummated, (i) the provisions of Section 2.5 shall not
be applicable, (ii) Employee shall continue to own and hold the Option Award and all other equity awards granted or issued to Employee
by the Company that are outstanding on the date of this Agreement, (iii) the terms of the Option Award and all of such other outstanding
equity awards shall be subject to the provisions of Section 2.3 hereof, and (iv) the provisions of the Employment Agreement that
provide for an increase in the number of Option Shares subject to the Option Award upon a Dilutive Event or a Change of Control
shall continue to apply to the Option Award, except that, for purposes of implementing such provisions, the definition of the term
Measurement Period, as used in the Employment Agreement, shall have the meaning ascribed to such term after giving effect to the
amendment and modification of such definition set forth below in this Section 2.6 instead of the meaning currently ascribed to
such term in the Employment Agreement. The Employment Agreement is hereby amended and modified by deleting Section 1(v) thereof
in its entirety and replacing it with the following:

    	 	2	 

     

    

“(v)“Measurement
Period” shall mean: (i) the period following the Effective Date that ends on December 31, 2021, or (ii) in the event
that during such period referred to in the foregoing clause (i), the Board authorizes or approves a Dilutive Event or the Company
enters into a written agreement that contemplates effecting a Dilutive Event, then the period of time commencing on the Effective
Date and ending upon the occurrence of such Dilutive Event, whichever is later. Provided however that in the event the Board decides
to not consummate the transaction(s) contemplated in subsection (ii) contained herein, the Measurement Period will be as provided
for in subsection (i) contained in this definition.” 

 

2.7   Unemployment.
The Company will not oppose any valid claims made by Employee for unemployment benefits, if any. Employee understands and acknowledges
that applicable state government authorities, and not the Company, determine Employee’s eligibility for unemployment benefits
and the amount of such benefits, if any.

 

2.8 Section 280G.
The Company and Employee hereby acknowledge that (i) the Company has engaged Aon Rewards Solutions (“Aon”), as a Valuation
Advisor, to provide the calculations and determination under Section 12 that would have been made by the Tax Counsel, based on
information provided by the Company with respect to the payments or benefits received or to be received by Employee (including,
without limitation, any payment or benefits received in connection with the Merger, other Change of Control, or Employee’s
termination of employment, whether pursuant to the terms of this Agreement, the Employment Agreement or any other plan, arrangement
or agreement, or otherwise) (all such payments or benefits collectively referred to herein as the “280G Payments”),
and (ii) that such calculations and determinations have been reviewed by Deloitte Tax LLP (“Deloitte”) with respect
to the 280G Payments, and the payments referenced in this Agreement reflect such review and the Parties’ desire to avoid
the applicability of 280G regarding any payments made to Employee under this Agreement. Based on the calculations and determinations
of Aon, and the review of such calculations and determinations of Deloitte, and based solely on the information provided to Aon
and Deloitte by the Company, the Parties reasonably believe that the 280G Payments, individually or in the aggregate, should not
constitute “parachute payments” within the meaning of Section 280G of the Code. Such conclusion could be subject to
change if any additional information regarding any 208G Payments is later discovered. However, notwithstanding any other provision
of this Agreement or any other plan, arrangement or agreement to the contrary, (x) if any of 280G Payments do constitute "parachute
payments" within the meaning of Section 280G of the Code and would, but for this Section 2.8, be subject to the excise tax
imposed under Section 4999 of the Code (or any successor provision thereto) or any similar tax imposed by state or local law or
any interest or penalties with respect to such taxes (collectively, the "Excise Tax") and (y) if the 280G Payments
are subject to reduction pursuant to Section 12(a) of the Employment Agreement, then the 280G Payments shall be reduced (but not
below zero) to the minimum extent necessary to ensure that no portion of the 280G Payments is subject to the Excise Tax. The 280G
Payments shall be reduced in a manner that maximizes Employee’s economic position. In applying this principle, the reduction
shall be made in a manner consistent with the requirements of Section 409A of the Code, and where two economically equivalent amounts
are subject to reduction but payable at different times, such amounts shall be reduced on a pro rata basis but not below zero.
Employee shall reimburse the Company for such portion of the 280G Payments as is necessary to avoid being subject to the Excise
Tax in a manner determined by the Company, that is consistent with the requirements of Section 409A of the Code; provided,
however, for clarity, that the amount of such reimbursement will not exceed the amount of any reduction in the 280G Payments
in accordance with the foregoing provisions of this Section 2.8.

    	 	3	 

     

    

2.9       Escrow
Costs and Expenses. All cost and expenses associated with the Escrow, including any setup, maintenance or wire fees, both incoming
and outgoing, will be the sole responsibility of Employee.

 

3.       Mutual
General Release of Claims. Except as to such rights or claims as may be created by this Agreement, Employee, and anyone and
any entity claiming through Employee, including but not limited to Employee’s heirs, administrators, successors in interest,
assigns and agents, hereby release and forever discharge the Company and all of its past, present and future employees, officers,
directors, members, agents, trustees, administrators, representatives, owners, shareholders, partners, insurers, fiduciaries, attorneys,
subsidiaries, parent companies, affiliates, related entities, assigns, predecessors and successors in interest, and each and all
of them, jointly and severally (collectively the “Company Released Parties”), and Company hereby releases and
forever discharges Employee, his estate, his heirs and all of their respective past and present administrators, representatives,
executors, successors in interest, assigns and agents, and each and all of them, jointly and severally (collectively, the “Employee
Released Parties”), from any and all liabilities, claims, causes of action, charges, complaints, obligations, costs,
losses, damages, injuries, penalties, interest, attorneys’ fees, and other legal responsibilities, of any form whatsoever,
whether known or unknown, unforeseen, unanticipated, unsuspected or latent, which Employee or Company has at any time owned or
held prior to Employee’s and Company’s execution of this Agreement, including but not limited to, any and all claims
arising out of, connected with, or relating to:

 

any and all claims relating
to or arising from Employee's employment relationship with the Company and the termination of that relationship, compensation or
benefits earned or received during that employment;

 

any and all claims for
wrongful discharge of employment; breach of contract, both express and implied; breach of a covenant of good faith and fair dealing,
both express and implied; negligent or intentional infliction of emotional distress; negligent or intentional misrepresentation;
negligent or intentional interference with contract or prospective economic advantage; defamation; negligence; personal injury;
assault; battery; invasion of privacy; false imprisonment; and conversion;

 

any and all claims for
violation of any federal, state or municipal statute, including, but not limited to, Title VII of the Civil Rights Act of
1964, the Civil Rights Act of 1991, the Age Discrimination in Employment Act of 1967, the Americans with Disabilities Act of 1990,
the Fair Labor Standards Act, the California Fair Employment and Housing Act, the California Labor Code, the Maryland Fair
Employment Practices Act, the Maryland False Claims Act, the Maryland Parental Leave Act, the Maryland Healthy Working Families
Act;

 

any and all claims arising
out of any other laws and regulations relating to employment or employment discrimination; and

 

any and all claims for
attorneys' fees and costs.

 

Each of the Employee
and the Company hereby agrees that the release set forth in this Section 3 shall be and remain in effect in all respects as a complete
general release as to the matters released. The foregoing general release does not apply to (i) this Agreement or the right to
enforce this Agreement, (ii) any of Employee’s or Company’s claims that arise after the date of this Agreement, including,
without limitation, any such claims, if any, under the Employment Agreement, the Confidentiality Agreement, the Inducement Plan,
the Option Agreement, any other contract between the Company and Employee, after giving effect to any amendment or modification
to the terms of any of such agreements, plan or contracts effected by the terms of this Agreement, (iii) any of Employee’s
or Company’s claims that cannot be released as a matter of law, (iv) any right to indemnification that Employee may have
under the certificate of incorporation or bylaws of the Company or under any indemnification agreement between Employee and the
Company or under any insurance policies maintained by the Company or (v) any right of Employee to receive any vested benefits under
the terms of any employee benefit plans and any award agreements thereunder. The Parties agree and acknowledge that the release
and waiver set forth above shall not prevent Employee from participating in or cooperating with any state or federal agency’s
investigation or charge of discrimination, including the Equal Employment Opportunity Commission (“EEOC”). The
Parties further agree and acknowledge that nothing in this Agreement, including the foregoing release, prevents or prohibits Employee
from filing a charge of discrimination with a state or federal agency, including the EEOC. However, each of Employee and the Company,
as a releasing Party, understands and agrees that such releasing Party is releasing the other Party from any and all of those claims
that such releasing Party is releasing pursuant to this Section 3 and, therefore, such releasing Party is releasing and giving
up the opportunity to recover any compensation, damages, or any other form of relief in any proceeding brought by such releasing
Party or on such releasing Party’s behalf with respect to such released claims; provided that this Agreement shall not limit
Employee’s right to receive an award for information provided to the Securities and Exchange Commission. Notwithstanding
anything express or implied in the Employment Agreement to the contrary, this Section 3 supersedes the Release of Claims and Employee’s
release and obligations under this Section 3 satisfy any requirement or obligation of Employee, or any condition applicable to
Employee, under the Employment Agreement to execute and deliver the Release of Claims.

    	 	4	 

     

    

4.       Older
Worker's Benefit Protection Act. This Agreement constitutes a knowing and voluntary waiver of any and all rights or claims
that Employee has or may have under the Federal Age Discrimination In Employment Act (the “ADEA”), as amended
by the Older Workers' Benefit Protection Act of 1990, 29 U.S.C. §§ 621 et seq. This paragraph and this
Agreement are written in a manner calculated to be understood by Employee. Employee is hereby advised in writing to consult with
an attorney before signing this Agreement. Employee has had a reasonable time of up to 45 days in which to consider signing this
Agreement. If Employee decides not to use all 45 days, Employee knowingly and voluntarily waives any claims that Employee
was not given the 45-day period or did not use the entire 45 days to consider this Agreement. Employee may revoke this Agreement
at any time within the 7-day period following the date Employee signs this Agreement by providing written notice of revocation
to the Company by email to dsaglio@senecabio.com so that said revocation notice is received before the expiration of the 7-day
revocation period (the “Revocation Period”). If Employee revokes the Agreement within the Revocation Period,
Employee will only be entitled to receive the Accrued Obligations as provided for in the Employment Agreement, none of the equity
awards granted or issued to Employee by the Company, including, without limitation, the Option Award, shall be cancelled pursuant
to Section 2.5 hereof and this Agreement (including the release set forth in this Section 3) shall become null and void. Employee
further acknowledges that the Company has provided Employee with ADEA disclosure information (under 29 U.S.C. § 626(f)(1)(H)).

 

5.       Mutual
Release of Unknown Claims. Employee and Company have reviewed and hereby expressly waive the provisions of Section 1542 of
the California Civil Code, which provides as follows: “A GENERAL RELEASE DOES NOT EXTEND TO
CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE
RELEASE AND THAT, IF KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.”
This Agreement extends to all claims or causes of action, of every nature and kind whatsoever, known or unknown, enumerated in
this Agreement or otherwise, except for those claims that this Agreement expressly provides are not being released pursuant to
this Agreement. Employee or Company may hereafter discover presently unknown facts or claims different from or in addition to those
that Employee or Company now knows as to the matters released herein. Nevertheless, it is Employee’s and Company’s
intention, through this Agreement, to fully release all such matters and all claims related thereto, which do now exist, may exist
or heretofore have existed, except for those matters and claims that this Agreement expressly provides are not being released pursuant
to this Agreement.

    	 	5	 

     

    

6.       Mutual
Covenant Not To Sue. Employee and Company have not, and will not, directly or indirectly institute any legal action against
the Company Released Parties or the Employee Released Parties, as applicable, based upon, arising out of, or relating to any claims
released in this Agreement, to the extent allowed by law. Employee and Company have not, and will not, directly or indirectly encourage
and/or solicit any third party to institute any legal action against the Company Released Parties or the Employee Released Parties,
as applicable, to the extent allowed by law.

 

7.       Inquiries.
The Company will respond to any inquiries about Employee’s employment by providing only Employee’s dates of employment
and job titles.

 

8.       No
Workplace Injuries; Representations. Employee hereby represents that Employee has not sustained any workplace injury of any
kind during Employee’s employment with the Company, and Employee does not intend to file any claim for or seek any workers’
compensation benefits. Employee further represents that, except for the amounts expressly stated in Section 2 of this Agreement,
Employee has been paid all compensation owed and for all hours worked, have received all the leave and leave benefits and protections
for which Employee is eligible pursuant to the Family and Medical Leave Act, the California Family Rights Act, the Maryland Healthy
Working Families Act, or any other applicable law.

 

9.       Prior
Agreements. This Agreement does not alter, modify or impact any confidentiality provisions and/or the restrictive covenants
set forth in the Confidentiality Agreement, nor does it affect Employee’s obligation to comply with those provisions and/or
covenants. Except as specifically provided for in this Agreement, this Agreement does not alter, modify or amend the Employment
Agreement, the Inducement Plan, the Option Agreement, any other applicable equity incentive plan or equity award agreement, or
the Confidentiality Agreement. In the event of any conflict between any of the terms of this Agreement or any of the terms of the
Employment Agreement, the Inducement Plan, the Option Agreement, any other applicable equity incentive plan or equity award agreement,
or the Confidentiality Agreement, the terms of this Agreement shall govern, control and supersede.

 

10.       Return
of All The Company Materials. At the request of the Company, Employee shall return to the Company all the Company’s records,
documents, electronically stored information, and tangible embodiments of such, in Employee’s possession, including but not
limited to the Company’s trade secrets, confidential information and proprietary information. Employee confirms that, at
the request of the Company, Employee shall also return to the Company all other property of the Company, including but not limited
to automobiles, keys, key cards, cellular phones, credit cards, personal and laptop computers, and any other electronic equipment.
The Company and Employee hereby acknowledge that the Employee and the Company have agreed that Employee will perform consulting
services for the Company following the termination of Employee’s employment with the Company on terms and conditions that
have been mutually agreed upon by the Employee and the Company, and that Employee shall retain all of the items contemplated under
the foregoing provisions of this Section 10 for use by Employee to provide such consulting services to the Company and that such
items shall be returned by Employee to the Company at such time as the Company shall request or as otherwise provided in accordance
with the terms and conditions of the consulting services to be rendered by Employee to the Company.

 

11.       Non-Disparagement.
Employee shall not make any disparaging remarks about any of the Company Released Parties, verbally or in writing, including without
limitation posting on social media applications such as YouTube, Facebook, Twitter, blogs, or other public fora, or otherwise take
any action that could reasonably be anticipated to cause damage to the reputation, goodwill, or business of any of the Company
Released Parties, or otherwise make remarks that may reflect negatively upon any of the Company Released Parties. The foregoing
does not waive Employee’s right to testify in an administrative, legislative, or judicial proceeding concerning alleged criminal
conduct or alleged sexual harassment when Employee has been required or requested to attend the proceeding pursuant to a court
order, subpoena, or written request from an administrative agency or the legislature; provided, Employee agrees to give the Company
the maximum notice possible of Employee’s intent to provide such testimony. The Company shall instruct its current and future
executive officers, human resources personnel and members of the Company’s Board of Directors of the Company (collectively,
the “Non-Disparagement Parties”) to not make any disparaging remarks about any of the Employee Released Parties,
verbally or in writing, including without limitation posting on social media applications such as YouTube, Facebook, Twitter, blogs,
or other public fora, or otherwise take any action that could reasonably be anticipated to cause damage to the reputation, goodwill,
or business of any of the Employee Released Parties, or otherwise make remarks that may reflect negatively upon any of the Employee
Released Parties. The Company shall take reasonable steps as permitted by applicable law to facilitate the Non-Disparagement Parties’
compliance with this Section; provided that nothing herein shall waive the Company’s or the Non-Disparagement Parties’
rights to testify in an administrative, legislative, or judicial proceeding concerning alleged criminal conduct or alleged sexual
harassment when the Company or the Non-Disparagement Parties have been required or requested to attend the proceeding pursuant
to a court order, subpoena, or written request from an administrative agency or the legislature; provided, that, to the extent
permitted by applicable law, Company and the Non-Disparagement Parties agree to give the Employee the maximum notice possible of
their intent to provide such testimony. This Section 11 is a material term of this Agreement.

    	 	6	 

     

    

12.       Representations
and Acknowledgments. Each Party hereby represents and warrants to the other Party that such Party (a) has read this Agreement
in its entirety, (b) has all requisite power and authority to execute and deliver this Agreement and to perform its or his obligations
hereunder, (c) fully understands the contents of this Agreement, (d) freely, voluntarily and without coercion enters into this
Agreement, and (e) is signing it with full knowledge that it is intended, to the maximum extent permitted by law, as a complete
release and waiver of any and all claims, except for those claims that this Agreement expressly provides are not being released
pursuant to this Agreement.

 

13.       Section
409A. The intent of the parties is that payments and benefits under this Agreement comply with or be exempt from Section 409A
of the Code, and the Company shall have complete discretion to interpret and construe this Agreement and any associated documents
in any manner that establishes an exemption from (or compliance with) the requirements of Section 409A of the Code. If for any
reason any provision of this Agreement does not accurately reflect its intended establishment of an exemption from (or compliance
with) Section 409A of the Code, as demonstrated by consistent interpretations or other evidence of intent, such provision shall
be considered ambiguous as to its exemption from (or compliance with) Section 409A of the Code and shall be interpreted by the
Company in a manner consistent with such intent, as determined in the discretion of the Company.

 

Any reimbursements
provided under this Agreement that constitute deferred compensation within the meaning of Section 409A of the Code shall be made
or provided in accordance with the requirements of Section 409A of the Code, including, without limitation, that (i) in no event
shall any fees, expenses or other amounts eligible to be reimbursed by the Company under this Agreement be paid later than the
last day of the calendar year next following the calendar year in which the applicable fees, expenses or other amounts were incurred;
and (ii) the amount of expenses eligible for reimbursement in any given calendar year shall not affect the expenses that the Company
is obligated to reimburse in any other calendar year.

 

For purposes of Section
409A of the Code, the Employee’s right to receive any installment payments shall be treated as a right to receive a series
of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number
of days (for example, “payment shall be made within thirty (30) days following the date of termination”), the actual
date of payment within the specified period shall be within the sole discretion of the Company. In no event may the Employee, directly
or indirectly, designate the calendar year of any payment to be made under this Agreement, to the extent such payment is subject
to Section 409A of the Code.

    	 	7	 

     

    

Notwithstanding any
provision to the contrary in this Agreement, if Employee is deemed by the Company at the time of Employee's separation from service
to be a “specified employee” for purposes of Section 409A of the Code, and if any of the payments upon separation from
service set forth herein and/or under any other agreement with the Company are deemed to be “deferred compensation,”
then, to the extent delayed commencement of any portion of such payments is required in order to avoid a prohibited distribution
under Section 409A of the Code and the related taxation under Section 409A of the Code, such payments shall not be provided to
Employee prior to the earliest of (i) the expiration of the six-month period measured from the date of separation from service,
(ii) the date of Executive's death or (iii) such earlier date as permitted under Section 409A of the Code without the imposition
of taxation thereunder.

 

14.       Severability.
In the event any provision of this Agreement is held to be void, null or unenforceable, the remaining portions shall remain in
full force and effect.

 

15.       No
Admission of Wrongdoing. Neither this Agreement nor the furnishing of the consideration for this Agreement shall be deemed
or construed as an admission of liability or wrongdoing on the part of the Company or Employee, nor shall they be admissible as
evidence in any proceeding other than for the enforcement of this Agreement.

 

16.       Modification.
This Agreement cannot be modified in any respect except in a written instrument signed by both Parties.

 

17.       Entire
Agreement. This Agreement sets forth the entire agreement between the Parties hereto, and fully supersedes any prior agreements
or understandings between the Parties, with respect to the subject matter of this Agreement.

 

18.       No
Reliance. Neither Party has not relied on any representations, promises, or agreements of any kind made to such Party in connection
with such Party’s decision to accept this Agreement, except for those set forth in this Agreement.

 

19.       Interpretation.
Any uncertainty or ambiguity in the Agreement shall not be construed for or against any Party based on the attribution of drafting
to any Party.

 

20.       Counterparts.
This Agreement may be executed by the Parties in counterparts, which are defined as duplicate originals, all of which taken together
shall be construed as one document.

 

21.       Signature.
A signature by facsimile or email on this Agreement shall be as legally binding as an original signature.

 

22.       Governing
Law. This Agreement shall be governed and conformed in accordance with the laws of the State of Maryland, without regard to
its conflicts of law principles.

 

23       Voluntary
Execution of Agreement. This Agreement is executed voluntarily and without any duress or undue influence on the part or behalf
of the Parties hereto, with the full intent of releasing all claims (except for those claims that this Agreement expressly provides
are not being released pursuant to this Agreement). The Parties acknowledge that:

 

(a)       They
have read this Agreement;

 

(b)       They
have had the opportunity to be represented in the preparation, negotiation, and execution of this Agreement by legal counsel of
their own choice;

    	 	8	 

     

    

(c)       They
understand the terms and consequences of this Agreement and of the releases it contains;

 

(d)       They
are fully aware of the legal and binding effect of this Agreement.

 

[Signature Page to Follow]

 

    	 	9	 

     

    

PLEASE READ CAREFULLY. THIS AGREEMENT INCLUDES
A RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS (OTHER THAN THOSE CLAIMS THAT THIS AGREEMENT SPECIFICALLY PROVIDES ARE NOT BEING RELEASED
PURSUANT TO THIS AGREEMENT).

 

IN WITNESS WHEREOF, the Parties have executed
this Agreement on the respective dates set forth below.

 

 

 

	 	EMPLOYEE
	 	 	 
	Dated: March 17, 2021	By	________________________________
	 	 	[________________]
	 	 	[_____]
	 	 	 
	 	 	 
	 	 	 
	 	COMPANY 
	 	 
	  	SENECA BIOPHARMA, INC.
	 	 	 
	Dated: March 17, 2021	By	________________________________
	 	 	[______________]
	 	 	[__________]

 

 

 

 

10

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