Exhibit 10.1

CONATUS PHARMACEUTICALS INC.

2013 INCENTIVE AWARD PLAN

RESTRICTED STOCK UNIT GRANT NOTICE AND

RESTRICTED STOCK UNIT AGREEMENT

Conatus Pharmaceuticals Inc., a Delaware corporation (the “Company”), pursuant
to its 2013 Incentive Award Plan, as amended from time to time (the “Plan”),
hereby grants to the holder listed below (“Participant”), an award of restricted
stock units (“Restricted Stock Units” or “RSUs”) with respect to the number of
shares of the Company’s Common Stock (the “Shares”) indicated below. This award
for Restricted Stock Units (this “Award”) is subject to the terms and conditions
set forth herein, in the Restricted Stock Unit Agreement attached hereto as
Exhibit A (the “Agreement”) and in the Plan, each of which are incorporated
herein by reference. Unless otherwise defined herein, the terms defined in the
Plan shall have the same defined meanings in this Grant Notice and the
Agreement.

 

Participant:    Grant Date:    Total Number of RSUs:    Distribution Schedule:
   Subject to the terms of the Restricted Stock Unit Agreement, the RSUs shall
be distributable in accordance with Section 2.1 of the Restricted Stock Unit
Agreement. Vesting Schedule:    Subject to the terms of the Restricted Stock
Unit Agreement, the RSUs shall vest as set forth on Exhibit B to this Grant
Notice.

By Participant’s signature below, Participant agrees to be bound by the terms
and conditions of the Plan, the Agreement and the Grant Notice. Participant has
reviewed the Agreement, the Plan and the Grant Notice in their entirety, has had
an opportunity to obtain the advice of counsel prior to executing the Grant
Notice and fully understands all provisions of the Grant Notice, the Agreement
and the Plan. Participant hereby agrees to accept as binding, conclusive and
final all decisions or interpretations of the Administrator upon any questions
arising under the Plan, the Grant Notice or the Agreement.

 

CONATUS PHARMACEUTICALS INC.      PARTICIPANT By:  

 

     By:   

 

Print Name:  

 

     Print Name:   

 

Title:  

 

       

 

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EXHIBIT A

TO RESTRICTED STOCK UNIT AWARD GRANT NOTICE

RESTRICTED STOCK UNIT AWARD AGREEMENT

Pursuant to the Grant Notice to which this Agreement is attached, the Company
has granted to Participant the number of RSUs set forth in the Grant Notice,
subject to all of the terms and conditions set forth in this Agreement, the
Grant Notice and the Plan.

ARTICLE I

GENERAL

1.1 Defined Terms. Capitalized terms not specifically defined herein shall have
the meanings specified in the Plan or the Grant Notice.

1.2 Incorporation of Terms of Plan. The Award is subject to the terms and
conditions set forth in this Agreement and the Plan, which is incorporated
herein by reference. In the event of any inconsistency between the Plan and this
Agreement, the terms of the Plan shall control.

ARTICLE II

AWARD OF RESTRICTED STOCK UNITS

2.1 Award of Restricted Stock Units.

(a) Award. In consideration of Participant’s continued employment or service
with the Company or any Subsidiary thereof and for other good and valuable
consideration, effective as of the grant date set forth in the Grant Notice (the
“Grant Date”), the Company hereby grants to Participant the number of RSUs set
forth in the Grant Notice, subject to all of the terms and conditions set forth
in this Agreement, the Grant Notice and the Plan. Prior to actual issuance of
any Shares, the RSUs and the Award represent an unsecured obligation of the
Company, payable only from the general assets of the Company.

(b) Vesting. The RSUs subject to the Award shall vest in accordance with the
Vesting Schedule set forth in Exhibit B to the Grant Notice. Unless and until
the RSUs have vested in accordance with the Vesting Schedule set forth in the
Grant Notice, Participant will have no right to any distribution with respect to
such RSUs. Unless otherwise provided in Exhibit B to the Grant Notice, in the
event of Participant’s Termination of Service prior to the vesting of all of the
RSUs, any unvested RSUs will terminate automatically without any further action
by the Company and be forfeited without further notice and at no cost to the
Company.

(c) Distribution of RSUs.

(i) Shares of Common Stock shall be distributed to Participant (or in the event
of Participant’s death, to his or her estate) with respect to Participant’s
vested RSUs within ten (10) days following the date on which such RSUs vest as
specified in the Vesting Schedule set forth in Exhibit B to the Grant Notice,
subject to the terms and provisions of the Plan and this Agreement.

(ii) All distributions of the RSUs shall be made by the Company in the form of
whole shares of Common Stock.

 

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(iii) Neither the time nor form of distribution of Common Stock with respect to
the RSUs may be changed, except as may be permitted by the Administrator in
accordance with the Plan and Section 409A of the Code and the Treasury
Regulations thereunder.

(d) Generally. Shares issued under the Award shall be issued to Participant or
Participant’s beneficiaries, as the case may be, at the sole discretion of the
Administrator, in either (i) uncertificated form, with the Shares recorded in
the name of Participant in the books and records of the Company’s transfer agent
with appropriate notations regarding the restrictions on transfer imposed
pursuant to this Agreement; or (ii) certificate form. In no event will
fractional shares be issued upon settlement of the Award. Only whole Shares
shall be issued in satisfaction of the Award and, in the event of any fractional
Shares subject to the Award, the Award shall be rounded down to the nearest
whole Share.

(e) Consideration to the Company. In consideration of the grant of the Award by
the Company, Participant agrees to render faithful and efficient services to the
Company or any Subsidiary. Nothing in the Plan, the Grant Notice or this
Agreement shall confer upon Participant any right to continue in the employ or
service of the Company or any Subsidiary or shall interfere with or restrict in
any way the rights of the Company and its Subsidiaries, which rights are hereby
expressly reserved, to discharge or terminate the services of Participant at any
time for any reason whatsoever, with or without cause, except to the extent
expressly provided otherwise in a written agreement between the Company or a
Subsidiary and Participant.

2.2 Tax Withholding.

(a) The Company shall not be obligated to deliver any certificate representing
Shares issuable with respect to the RSUs to Participant or his or her legal
representative unless and until Participant or his or her legal representative
shall have paid or otherwise satisfied in full the amount of all federal, state,
local and foreign taxes applicable with respect to the taxable income of
Participant resulting from the vesting of the RSUs, the distribution of the
Shares issuable with respect thereto, or any other taxable event related to the
RSUs (the “Tax Withholding Obligation”).

(b) Unless Participant elects to satisfy the Tax Withholding Obligation by some
other means in accordance with clause (c) below prior to the time the Tax
Withholding Obligation arises, Participant’s acceptance of this Award
constitutes Participant’s instruction and authorization to the Company to, and
the Company shall, withhold a net number of vested Shares otherwise issuable
pursuant to the RSUs having a then-current Fair Market Value not exceeding the
amount necessary to satisfy the Tax Withholding Obligation of the Company and
its Subsidiaries with respect to the vesting or distribution of the RSUs.

(c) At any time not less than five (5) business days before any Tax Withholding
Obligation arises, Participant may elect to satisfy the Tax Withholding
Obligation by delivering to the Company an amount that the Company determines is
sufficient to satisfy the Tax Withholding Obligation in one or more of the forms
specified below:

(i) in cash or by the deduction of such amount from other compensation payable
to Participant;

(ii) by tendering vested Shares owned by Participant having a then-current Fair
Market Value not exceeding the amount necessary to satisfy the Tax Withholding
Obligation of the Company and its Subsidiaries; or

 

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(iii) in any combination of the foregoing.

(d) To the maximum extent permitted by Applicable Law, the Company further has
the authority to deduct or withhold such amount as is necessary to satisfy any
Tax Withholding Obligation from other compensation payable to Participant.

(e) Subject to Section 11.2 of the Plan, the applicable Tax Withholding
Obligation will be determined based on Participant’s Applicable Tax Withholding
Rate. Participant’s “Applicable Tax Withholding Rate” shall mean the greater of
(i) the minimum applicable statutory tax withholding rate or (ii) with
Participant’s consent, the maximum individual tax withholding rate permitted
under the rules of the applicable taxing authority for tax withholding
attributable to the underlying transaction; provided, however, that in no event
shall Participant’s Applicable Tax Withholding Rate exceed the maximum
individual statutory tax rate in the applicable jurisdiction at the time of such
withholding (or such other rate as may be required to avoid the liability
classification of the applicable award under generally accepted accounting
principles in the United States of America); provided, however, that the number
of Shares tendered or withheld, if applicable, pursuant to Section 2.2(b) or
Section 2.2(c)(ii) shall be rounded up to the nearest whole Share sufficient to
cover the applicable Tax Withholding Obligation, to the extent rounding up to
the nearest whole Share does not result in the liability classification of the
RSUs under generally accepted accounting principles.

(f) Participant is ultimately liable and responsible for all taxes owed in
connection with the Option, regardless of any action the Company or any
Subsidiary takes with respect to any tax withholding obligations that arise in
connection with the Award. Neither the Company nor any Subsidiary makes any
representation or undertaking regarding the treatment of any tax withholding in
connection with the awarding, vesting or settlement of the Award or the
subsequent sale of Shares. The Company and the Subsidiaries do not commit and
are under no obligation to structure the Award to reduce or eliminate
Participant’s tax liability.

ARTICLE III

RESTRICTIONS

3.1 Award and Interests Not Transferable. This Award may not be sold, pledged,
assigned or transferred in any manner other than by will or the laws of descent
and distribution, unless and until the Shares issuable pursuant to the Award
have been issued, and all restrictions applicable to such Shares have lapsed.
This Award and the rights and privileges conferred hereby shall not be liable
for the debts, contracts or engagements of Participant or his or her successors
in interest and shall not be subject to disposition by transfer, alienation,
anticipation, pledge, encumbrance, assignment or any other means whether such
disposition be voluntary or involuntary or by operation of law by judgment,
levy, attachment, garnishment or any other legal or equitable proceedings
(including bankruptcy), and any attempted disposition thereof shall be null and
void and of no effect, except to the extent that such disposition is permitted
by the preceding sentence.

3.2 Rights as Stockholder. Neither Participant nor any person claiming under or
through Participant shall have any of the rights or privileges of a stockholder
of the Company in respect of any Shares issuable hereunder unless and until
certificates representing such Shares (which may be in book-entry form) will
have been issued and recorded on the books and records of the Company or its
transfer agents or registrars, and delivered to Participant (including through
electronic delivery to a brokerage account). No adjustment will be made for a
dividend or other right for which the record date is prior to the date of such
issuance, recordation and delivery, except as provided in Section 13.2 of the
Plan. Except as otherwise provided herein, after such issuance, recordation and
delivery, Participant will have all the rights of a stockholder of the Company
with respect to such shares of Stock, including, without limitation, the right
to receipt of dividends and distributions on such shares.

 

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3.4 Award Subject to Clawback. This Award and any Shares issuable upon vesting
of the RSUs are subject to Section 11.5 of the Plan.

3.5 Conditions to Issuance of Shares or Settlement of Award. The Company shall
not be required to issue or deliver any Shares issuable upon the vesting of the
RSUs prior to the fulfillment of all of the following conditions: (a) the
admission of the Shares to listing on all stock exchanges on which such Shares
are then listed, (b) the completion of any registration or other qualification
of the Shares under any state or federal law or under rulings or regulations of
the U.S. Securities and Exchange Commission or other governmental regulatory
body, which the Administrator shall, in its sole and absolute discretion, deem
necessary and advisable, (c) the obtaining of any approval or other clearance
from any state or federal governmental agency that the Administrator shall, in
its absolute discretion, determine to be necessary or advisable, (d) the lapse
of any such reasonable period of time following the date the RSUs vest as the
Administrator may from time to time establish for reasons of administrative
convenience, and (e) the receipt by the Company of full payment of any
applicable withholding tax in any manner permitted under Section 2.2 above.

ARTICLE IV

OTHER PROVISIONS

4.1 Administration. The Administrator shall have the power to interpret the
Plan, the Grant Notice and this Agreement and to adopt such rules for the
administration, interpretation and application of the Plan, the Grant Notice and
this Agreement as are consistent therewith and to interpret, amend or revoke any
such rules. All actions taken and all interpretations and determinations made by
the Administrator will be final and binding upon Participant, the Company and
all other interested persons. To the extent allowable pursuant to Applicable
Law, no member of the Administrator will be personally liable for any action,
determination or interpretation made with respect to the Plan, the Grant Notice
or this Agreement.

4.2 Adjustments. Participant acknowledges that the Award, including the vesting
of the Award and the number of Shares subject to the Award, is subject to
adjustment in the discretion of the Administrator upon the occurrence of certain
events as provided in this Agreement and Section 13.2 of the Plan.

4.3 Notices. Any notice to be given under the terms of this Agreement to the
Company shall be addressed to the Company in care of the Secretary of the
Company at the Company’s principal office, and any notice to be given to
Participant shall be addressed to Participant at Participant’s last address
reflected on the Company’s personnel records. By a notice given pursuant to this
Section 4.3, either party may hereafter designate a different address for
notices to be given to that party. Any notice shall be deemed duly given when
sent via email or when sent by certified mail (return receipt requested) and
deposited (with postage prepaid) in a post office or branch post office
regularly maintained by the United States Postal Service.

4.4 Titles. Titles are provided herein for convenience only and are not to serve
as a basis for interpretation or construction of this Agreement.

4.5 Governing Law. The laws of the State of Delaware shall govern the
interpretation, validity, administration, enforcement and performance of the
terms of this Agreement regardless of the law that might be applied under
principles of conflicts of laws.

 

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4.6 Conformity to Securities Laws. Participant acknowledges that the Plan, the
Grant Notice and this Agreement are intended to conform to the extent necessary
with all Applicable Laws, including, without limitation, the provisions of the
Securities Act and the Exchange Act and any and all regulations and rules
promulgated thereunder by the Securities and Exchange Commission and state
securities laws and regulations. Notwithstanding anything herein to the
contrary, the Plan shall be administered, and the Award is granted, only in such
a manner as to conform to Applicable Law. To the extent permitted by Applicable
Law, the Plan, the Grant Notice and this Agreement shall be deemed amended to
the extent necessary to conform to Applicable Law.

4.7 Tax Representations. Participant has reviewed with Participant’s own tax
advisors the federal, state, local and foreign tax consequences of this
investment and the transactions contemplated by the Grant Notice and this
Agreement. Participant is relying solely on such advisors and not on any
statements or representations of the Company or any of its agents. Participant
understands that Participant (and not the Company) shall be responsible for
Participant’s own tax liability that may arise as a result of this investment or
the transactions contemplated by this Agreement.

4.8 Amendment, Suspension and Termination. To the extent permitted by the Plan,
this Agreement may be wholly or partially amended or otherwise modified,
suspended or terminated at any time or from time to time by the Administrator or
the Board, provided that, except as may otherwise be provided by the Plan, no
amendment, modification, suspension or termination of this Agreement shall
adversely affect the Award in any material way without the prior written consent
of Participant

4.9 Successors and Assigns. The Company may assign any of its rights under this
Agreement to single or multiple assignees, and this Agreement shall inure to the
benefit of the successors and assigns of the Company. Subject to the
restrictions on transfer set forth in Section 3.1 and the Plan, this Agreement
shall be binding upon and inure to the benefit of the heirs, legatees, legal
representatives, successors and assigns of the parties hereto.

4.10 Limitations Applicable to Section 16 Persons. Notwithstanding any other
provision of the Plan or this Agreement, if Participant is subject to Section 16
of the Exchange Act, the RSUs, the Plan and this Agreement shall be subject to
any additional limitations set forth in any applicable exemptive rule under
Section 16 of the Exchange Act (including any amendment to Rule 16b-3 of the
Exchange Act) that are requirements for the application of such exemptive rule.
To the extent permitted by Applicable Law, this Agreement shall be deemed
amended to the extent necessary to conform to such applicable exemptive rule.

4.11 Not a Contract of Employment. Nothing in this Agreement or in the Plan
shall confer upon Participant any right to continue to serve as an employee or
other service provider of the Company or any Subsidiary or shall interfere with
or restrict in any way the rights of the Company and its Subsidiaries, which
rights are hereby expressly reserved, to discharge or terminate the services of
Participant at any time for any reason whatsoever, with or without cause, except
to the extent expressly provided otherwise in a written agreement between the
Company or a Subsidiary and Participant

4.12 Entire Agreement. The Plan, the Grant Notice and this Agreement (including
any exhibit hereto) constitute the entire agreement of the parties and supersede
in their entirety all prior undertakings and agreements of the Company and
Participant with respect to the subject matter hereof, including without
limitation, the provisions of any employment agreement or offer letter regarding
equity awards to be awarded to Participant by the Company, or any other oral,
implied or written promises, statements, understandings, undertakings or
agreements by the Company or any of its representatives regarding equity awards
to be awarded to Participant by the Company (other than the terms of any such
agreements that govern acceleration of equity awards held by Participant).

 

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4.13 Section 409A.

(a) Notwithstanding any other provision of the Plan, this Agreement or the Grant
Notice, the Plan, this Agreement and the Grant Notice shall be interpreted in
accordance with, and incorporate the terms and conditions required by,
Section 409A of the Code (together with any Treasury Regulations and other
interpretive guidance issued thereunder, including without limitation any such
regulations or other guidance that may be issued after the Grant Date,
“Section 409A”). The Administrator may, in its discretion, adopt such amendments
to the Plan, this Agreement or the Grant Notice or adopt other policies and
procedures (including amendments, policies and procedures with retroactive
effect), or take any other actions, as the Administrator determines are
necessary or appropriate to comply with the requirements of Section 409A.

(b) This Agreement is not intended to provide for any deferral of compensation
subject to Section 409A of the Code, and, accordingly, the Shares issuable
pursuant to the RSUs shall be distributed to Participant no later than the later
of: (i) the fifteenth (15th) day of the third month following Participant’s
first taxable year in which such RSUs are no longer subject to a substantial
risk of forfeiture, and (ii) the fifteenth (15th) day of the third month
following first taxable year of the Company in which such RSUs are no longer
subject to substantial risk of forfeiture, as determined in accordance with
Section 409A and any Treasury Regulations and other guidance issued thereunder.

(c) For purposes of Section 409A of the Code (including, without limitation, for
purposes of Treasury Regulation Section 1.409A-2(b)(2)(iii)), each payment that
Participant may be eligible to receive under this Agreement shall be treated as
a separate and distinct payment.

4.14 Agreement Severable. In the event that any provision of the Grant Notice or
this Agreement is held invalid or unenforceable, such provision will be
severable from, and such invalidity or unenforceability will not be construed to
have any effect on, the remaining provisions of the Grant Notice or this
Agreement.

4.15 Limitation on Participant’s Rights. Participation in the Plan confers no
rights or interests other than as herein provided. This Agreement creates only a
contractual obligation on the part of the Company as to amounts payable and
shall not be construed as creating a trust. Neither the Plan nor any underlying
program, in and of itself, has any assets. Participant shall have only the
rights of a general unsecured creditor of the Company with respect to amounts
credited and benefits payable, if any, with respect to the Award, and rights no
greater than the right to receive the Shares as a general unsecured creditor.

4.16 Counterparts. The Grant Notice may be executed in one or more counterparts,
including by way of any electronic signature, subject to Applicable Law, each of
which shall be deemed an original and all of which together shall constitute one
instrument.

 

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EXHIBIT B

TO RESTRICTED STOCK UNIT AWARD GRANT NOTICE

VESTING SCHEDULE

1. Time-Based Vesting. The RSUs shall vest on the first anniversary of the Grant
Date.

2. Accelerated Vesting. The RSUs shall vest immediately (a) upon the occurrence
of a Change in Control, or (b) if Participant’s employment is terminated by the
Company without Cause (as defined in the Plan) or by Participant for Good Reason
(as defined in the Plan).

3. Forfeiture. Any portion of the Award and any RSUs which do not vest pursuant
to Sections 1 or 2 above shall automatically and without further action be
cancelled and forfeited by Participant, and Participant shall have no further
right or interest in or with respect to such portion of the Award or RSUs.