Item 1.01 Entry into a Material Definitive Agreement.

On March 31, 2021 (the "Effective Date"), Aytu BioPharma, Inc. ("Aytu" or the "Company") and Acerus Pharmaceuticals Corporation ("Acerus") entered into a termination and transition agreement (the "Termination Agreement"), pursuant to which Aytu and Acerus agreed to terminate the Amended and Restated License and Supply Agreement, previously entered into by Aytu and Acerus on July 29, 2019 (the "License and Supply Agreement"), a copy of which is filed as Exhibit 10.1 to the Current Report on Form 8-K filed by Aytu on August 2, 2019.

The material terms of the Termination Agreement are as follows:





  ? Aytu ceased all sale, marketing and promotion of the Products (as defined in
    the License and Supply Agreement) in the United States on April 1, 2021.




  ? Acerus agreed to pay Aytu an aggregate amount equal to $7.5 million, payable
    in equal monthly installment payments for a period of 30 consecutive months.




  ? Acerus agreed to repurchase all Product (as defined in the License and Supply
    Agreement) inventory held by Aytu as of the Effective Date.




  ? Aytu agreed to perform all of its distribution related obligations under the
    License and Supply Agreement and to assist Acerus and book Acerus' sales of
    Product (as defined in the License and Supply Agreement) to third parties from
    the Effective Date until such date that Acerus is able to book Product (as
    defined in the License and Supply Agreement) sales without Aytu's assistance
    (but in no event later than July 31, 2021) (the "Transition Period").




  ? Aytu agreed to pay to Acerus an amount equal to gross sales less applicable
    deductions and direct costs attributable to sales made during the Transition
    Period.

The Company issued a press release on April 1, 2021 announcing the Termination Agreement, attached as Exhibit 99.1 to this report

Item 1.02 Termination of Material Definitive Agreement.

The information set forth under Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.

Item 5.02 Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers.

Resignation of Chief Financial Officer

On March 31, 2021, David A. Green resigned as Chief Financial Officer of the Company. Accordingly, Aytu and Mr. Green expect to enter into a separation agreement.

Appointment of Chief Financial Officer

On March 31, 2021, the Board appointed Richard Eisenstadt as Chief Financial Officer of the Company. Aytu and Mr. Eisenstadt entered into an employment agreement, effective March 31, 2021 (the "CFO Employment Agreement"), attached as Exhibit 10.1 hereto. Pursuant to the CFO Employment Agreement, Mr. Eisenstadt will receive:





  ? An annual base salary of $400,000, plus a target bonus of 40% of the base
    salary if certain performance milestones are met;




  ? A signing bonus of $50,000;




  ? A potential transition bonus of $125,000, if one or more benchmarks is met
    between March 19, 2021 and July 1, 2021;




  ? A restricted stock unit grant of 55,000 shares of Aytu's common stock, subject
    to certain vesting provisions set forth therein;




  ? Upon a termination without cause by the Company or for good reason, as those
    terms are defined in the CFO Employment Agreement, by Mr. Eisenstadt, a
    severance payment equal to his base salary plus any earned incentive
    compensation, as well as a continuation of Aytu's portion of COBRA payments
    for a period of 12 months and vesting of any issued restricted stock units;
    and




  ? Upon a change in control, as defined in the CFO Employment Agreement, a
    payment equal to one times the base salary and the target annual incentive
    bonus compensation for the then-current year, plus 12 months of COBRA payments
    and accelerated vesting of all stock options or stock based awards.

The Company issued a press release on April 5, 2021 announcing the resignation of Mr. Green and appointment of Mr. Eisenstadt, attached as Exhibit 99.2 to this report.





Indemnification Agreements

On March 31, 2021, Josh Disbrow, Chief Executive Officer of the Company, and Richard Eisenstadt each entered into an indemnification agreement with the Company, the form of which was previously approved by the board of directors of the Company, as disclosed in the Current Report on Form 8-K previously filed by Aytu on March 22, 2021.

The indemnification agreements clarify and supplement indemnification provisions already contained in the Company's Bylaws and generally provide that the Company agrees, among other things, to indemnify directors and certain officers under the circumstances and to the extent provided for therein, to the maximum extent permitted by Delaware law, including indemnification of expenses such as attorneys' fees, judgments, penalties, fines and settlement amounts incurred by the director or officer in any claim arising out of the person's service to the Company. The indemnification agreement also provides for the advancement of expenses relating to the indemnification obligations.





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Item 9.01 Financial Statements and Exhibits.

(d) The following exhibits are being filed herewith:





Exhibit   Description
10.1      Employment Agreement between Aytu
          BioPharma, Inc. and Richard
          Eisenstadt, dated March 31, 2021
99.1*       Press Release dated April 1, 2021
99.2*       Press Release dated April 5, 2021

* In accordance with General Instruction B.2 of Form 8-K, the information in the press releases attached as Exhibits 99.1 and 99.2 hereto shall not be deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.





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