Exhibit 10.1
RETENTION AGREEMENT
This Retention Agreement (the “Agreement”) is entered into by and between
[_____________] (the “Executive”) and Obalon Therapeutics, Inc., a Delaware
corporation (the “Company”), on [__________], and is effective on the date on
which the Executive commences employment with the Company (the “Effective
Date”).
1.Term of Agreement.
Except to the extent renewed as set forth in this Section 1, this Agreement
shall terminate on the earlier of the third (3rd) anniversary of the Effective
Date (the “Expiration Date”) or the date the Executive’s employment with the
Company terminates for a reason other than a Qualifying Termination or CIC
Qualifying Termination; provided however, if a definitive agreement relating to
a Change in Control has been signed by the Company on or before the Expiration
Date, then this Agreement shall remain in effect through the earlier of:
(a)    The date the Executive’s employment with the Company terminates for a
reason other than a Qualifying Termination or CIC Qualifying Termination, or
(b)    The date the Company has met all of its obligations under this Agreement
following a termination of the Executive’s employment with the Company due to a
Qualifying Termination or CIC Qualifying Termination.
This Agreement shall renew automatically and continue in effect for three (3)
year periods measured from the initial Expiration Date, unless the Company
provides Executive notice of non-renewal at least three (3) months prior to the
date on which this Agreement would otherwise renew. For the avoidance of doubt,
and notwithstanding anything to the contrary in Section 2 or 3 below, the
Company’s non-renewal of this Agreement shall not constitute a Qualifying
Termination or CIC Qualifying Termination, as applicable.
2.    Qualifying Termination. If the Executive is subject to a Qualifying
Termination, then, subject to (i) Executive’s satisfactions of the Release
Conditions, (ii) Executive’s continued compliance with the terms and conditions
of Section 6 of this Agreement, and (iii) Sections 9 and 10 below, Executive
will be entitled to the following benefits:
(a)    Severance Benefits. The Company shall pay the Executive six (6) months of
his or her monthly base salary (at the rate in effect immediately prior to the
actions that resulted in the Qualifying Termination). The Executive will receive
his or her severance payment in a cash lump-sum in accordance with the Company’s
standard payroll procedures which will be made on the first business day
occurring after the sixtieth (60th) day following the Separation.

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(b)    Continued Employee Benefits. If Executive timely elects continued
coverage under the Consolidated Omnibus Budget Reconciliation Act (“COBRA”), the
Company shall pay the full amount of Executive’s COBRA premiums on behalf of the
Executive for the Executive’s continued coverage under the Company’s health,
dental and vision plans, including coverage for the Executive’s eligible
dependents, for the six (6) month period following the Executive’s Separation
or, if earlier, until Executive is eligible to be covered under another
substantially equivalent health, dental and vision plan by a subsequent
employer. Notwithstanding the foregoing, if the Company, in its sole discretion,
determines that it cannot provide the foregoing subsidy of COBRA coverage
without potentially violating or causing the Company to incur additional expense
as a result of noncompliance with applicable law (including, without limitation,
Section 2716 of the Public Health Service Act), the Company instead shall
provide to Executive a taxable monthly payment in an amount equal to the monthly
COBRA premium that Executive would be required to pay to continue the group
health coverage in effect on the date of the Separation (which amount shall be
based on the premium for the first month of COBRA coverage), which payments
shall be made regardless of whether Executive elects COBRA continuation coverage
and shall commence on the later of (i) the first day of the month following the
month in which Executive experiences a Separation and (ii) the effective date of
the Company’s determination of violation of applicable law, and shall end on the
earlier of (x) the effective date on which Executive becomes covered by a
health, dental or vision insurance plan of a subsequent employer, and (y) the
last day of the period six (6) months after the Separation, provided that, any
taxable payments under Section 2(b) will not be paid before the first business
day occurring after the sixtieth (60th) day following the Separation and, once
they commence, will include any unpaid amounts accrued from the date of
Executive’s Separation (to the extent not otherwise satisfied with continuation
coverage). However, if the period comprising the sum of the sixty (60)-day
period described in the preceding sentence and the ten (10)-day period described
in Section 7(e)(3) below spans two calendar years, then the payments which
constitute deferred compensation subject to Section 409A will not in any case be
paid in the first calendar year. Executive shall have no right to an additional
gross-up payment to account for the fact that such COBRA premium amounts are
paid on an after-tax basis.
3.    CIC Qualifying Termination. If the Executive is subject to a CIC
Qualifying Termination, then, subject to (i) Executive’s satisfactions of the
Release Conditions, (ii) Executive’s continued compliance with the terms and
conditions of Section 6 of this Agreement, and (iii) Sections 9 and 10 below,
Executive will be entitled to the following benefits:
(a)    Severance and Bonus Payments. The Company or its successor shall pay the
Executive (i) twelve (12) months of his or her monthly base salary (at the rate
in effect immediately prior to the actions that resulted in the Separation) and
(ii) a pro rata portion (based on number of months worked in the Company’s
fiscal year of the Separation) of Executive’s then-current target bonus
opportunity. Such payment shall be paid in a cash lump sum payment in accordance
with the Company’s standard payroll procedures, which payment will be made on
the first business day occurring after the sixtieth (60th) day following the
Separation.

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(b)    Equity.
(i)
Equity Awards. Each of Executive’s then-outstanding Equity Awards, including
awards that would otherwise vest only upon satisfaction of performance criteria,
shall accelerate and become vested and exercisable as to 100% of the then
unvested shares subject to the Equity Award. “Equity Awards” means all options
to purchase shares of Company common stock that are granted on or after the
Effective Date, as well as any and all other stock-based awards granted to the
Executive, including but not limited to stock bonus awards, restricted stock,
restricted stock units or stock appreciation rights that are granted on or after
the Effective Date. Subject to Section 4, the accelerated vesting described
above shall be effective as of the Separation.

(ii)
Non-Assumption of Equity Awards. Notwithstanding anything to the contrary, if
the successor or acquiring corporation (if any) of the Company refuses to
assume, convert, replace or substitute Executive’s unvested Equity Awards, as
provided in the applicable Plan, in connection with a Corporate Transaction (as
defined in the applicable Plan, or such similar term as is defined in an
applicable Plan), then notwithstanding any other provision in this Agreement or
the Plan to the contrary, each of Executive’s then-outstanding and unvested
Equity Awards that are not assumed, converted, replaced or substituted,
including awards that would otherwise vest only upon satisfaction of performance
criteria (measured at 100% of target), shall accelerate and become vested and
exercisable as to 100% of the then unvested shares subject to the Equity Award
effective immediately prior to the Corporate Transaction.

(c)    Pay in Lieu of Continued Employee Benefits. If Executive timely elects
continued coverage under the Consolidated Omnibus Budget Reconciliation Act
(“COBRA”), the Company or its successor shall pay the full amount of Executive’s
COBRA premiums on behalf of the Executive for the Executive’s continued coverage
under the Company’s health, dental and vision plans, including coverage for the
Executive’s eligible dependents, for the twelve (12) month period following the
Executive’s Separation or, if earlier, until Executive is eligible to be covered
under another substantially equivalent health, dental and vision plan by a
subsequent employer. Notwithstanding the foregoing, if the Company, in its sole
discretion, determines that it cannot provide the foregoing subsidy of COBRA
coverage without potentially violating or causing the Company to incur
additional expense as a result of noncompliance with applicable law (including,
without limitation, Section 2716 of the Public Health Service Act), the Company
instead shall provide to Executive a taxable monthly payment in an amount equal
to the monthly COBRA premium that Executive would be required to pay to continue
the group health coverage in effect on the date of the Separation (which amount
shall be based on the premium for the first month of

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COBRA coverage), which payments shall be made regardless of whether Executive
elects COBRA continuation coverage, shall commence on the later of (i) the first
day of the month following the month in which Executive experiences a Separation
and (ii) the effective date of the Company’s determination of violation of
applicable law, and shall end on the earlier of (x) the effective date on which
Executive becomes covered by a health, dental or vision insurance plan of a
subsequent employer, and (y) the last day of the period twelve (12) months after
the Separation, provided that, any taxable payments under Section 3(c) will not
be paid before the first business day occurring after the sixtieth (60th) day
following the Separation and, once they commence, will include any unpaid
amounts accrued from the date of Executive’s Separation (to the extent not
otherwise satisfied with continuation coverage). However, if the period
comprising the sum of the sixty (60)-day period described in the preceding
sentence and the ten (10)-day period described in Section 7(e)(3) below spans
two calendar years, then the payments which constitute deferred compensation
subject to Section 409A will not in any case be paid in the first calendar year.
Executive shall have no right to an additional gross-up payment to account for
the fact that such COBRA premium amounts are paid on an after-tax basis.
4.    General Release. Any other provision of this Agreement notwithstanding,
the benefits under Section 2 and 3 shall not apply unless the Executive (i) has
executed a general release (in substantially the form attached hereto as Exhibit
A) of all known and unknown claims that he or she may then have against the
Company or persons affiliated with the Company and such release has become
effective and (ii) has agreed not to prosecute any legal action or other
proceeding based upon any of such claims. The release must be in the form
prescribed by the Company, without alterations (this document effecting the
foregoing, the “Release”). The Company will deliver the form of Release to the
Executive within thirty (30) days after the Executive’s Separation. The
Executive must execute and return, and if applicable, not revoke, the Release
within the time period specified in the form.
5.    Accrued Compensation and Benefits. Notwithstanding anything to the
contrary in Section 2 and 3 above, in connection with any termination of
employment (whether or not a Qualifying Termination or CIC Qualifying
Termination), the Company shall pay Executive’s earned but unpaid base salary
and other vested but unpaid cash entitlements for the period through and
including the termination of employment, including unused earned vacation pay
and unreimbursed documented business expenses incurred by Executive through and
including the date of termination (collectively “Accrued Compensation and
Expenses”), as required by law and the applicable Company plan or policy. In
addition, Executive shall be entitled to any other vested benefits earned by
Executive for the period through and including the termination date of
Executive’s employment under any other employee benefit plans and arrangements
maintained by the Company, in accordance with the terms of such plans and
arrangements, except as modified herein (collectively “Accrued Benefits”). Any
Accrued Compensation and Expenses to which the Executive is entitled shall be
paid to the Executive in cash as soon as administratively practicable after the
termination and, in any event, no later than two and one-half (2-1/2) months
after the end of the taxable year of the Executive in which the termination
occurs or at such earlier time as may be required by Section 10

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below or to such lesser extent as may be mandated by Section 9 below. Any
Accrued Benefits to which the Executive is entitled shall be paid to the
Executive as provided in the relevant plans and arrangements.
6.    Covenants.
(a)    Non-Competition. The Executive agrees that, during his or her employment
with the Company, he or she shall not engage in any other employment, consulting
or other business activity (whether full-time or part-time) that would create a
conflict of interest with the Company.
(b)    Cooperation and Non-Disparagement. The Executive agrees that, during the
six (6) month period following his or her cessation of employment, he or she
shall cooperate with the Company in every reasonable respect and shall use his
or her best efforts to assist the Company with the transition of Executive’s
duties to his or her successor. The Executive further agrees that, during this
six (6)-month period, he or she shall not in any way or by any means disparage
the Company, the members of the Company’s Board of Directors or the Company’s
officers and employees.
7.    Definitions.
(a)    “Cause” means: (i) Executive’s conviction for, or guilty plea to, a
felony involving moral turpitude; (ii) a willful refusal by Executive to comply
with the lawful and reasonable instructions of the Company, or to otherwise
perform Executive’s duties as lawfully and reasonably determined by the Company,
in each case that is not cured by Executive (if such refusal is of a type that
is capable of being cured) within 15 days of written notice being given to
Executive of such refusal; (iii) any willful act or acts of dishonesty
undertaken by Executive and intended to result in Executive’s (or any other
person’s) material gain or personal enrichment at the expense of the Company or
any of its customers, partners, affiliates, or employees; or (iv) any willful
act of gross misconduct by Executive which is injurious to the Company.
(b)    “Code” means the Internal Revenue Code of 1986, as amended.
(c)    “Change in Control” For all purposes under this Agreement, a Change in
Control shall mean a “Corporate Transaction,” as such term is defined in the
Company’s 2016 Equity Incentive Plan, as may be amended from time to time,
provided that the transaction (including any series of transactions) also
qualifies as a change in control event under U.S. Treasury Regulation
1.409A-3(i)(5).
(d)    “CIC Qualifying Termination” means a Separation (i) within twelve (12)
months following a Change in Control or (ii) within three (3) months preceding a
Change in Control (but as to part (ii), only if the Separation occurs after a
Potential Change in Control) resulting, in either case (i) or (ii), from (A) the
Company or its successor terminating the Executive’s employment for any reason
other than Cause or (B) the Executive voluntarily resigning his or her
employment for Good Reason. A termination or resignation due to the Executive’s
death or disability shall not

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constitute a CIC Qualifying Termination. A “Potential Change in Control” means
the date of execution of a legally binding and definitive agreement for a
corporate transaction which, if consummated, would constitute the applicable
Change in Control (which for the avoidance of doubt, would include a merger
agreement, but not a term sheet for a merger agreement). In the case of a
termination following a Potential Change in Control and before a Change in
Control, solely for purposes of benefits under this Agreement, the date of
Separation will be deemed the date the Change in Control is consummated.
(e)    “Good Reason” means, without the Executive’s consent, (i) a reduction in
Executive’s then-current base salary (except for a reduction that is part of a
proportional reduction of the base salaries of all Company executives), bonus
opportunity or commissions opportunity; (ii) the offices of the Company that
Executive is required to report to being moved such that Executive’s usual
commuting distance is increased by more than ten (10) miles; or (iii) a material
and adverse change to Executive’s title, duties or responsibilities; provided,
however, that a resignation by Executive shall not be considered to be for a
“Good Reason” unless (i) Executive provides written notice to the Company’s
Chief Executive Officer of the occurrence of the event which Executive contends
constitutes Good Reason within ninety (90) days of the date such event occurs,
which notice states Executive’s intention to resign for a “Good Reason” under
this Agreement as a result thereof, (ii) the Company does not effect a cure with
respect to such event within thirty (30) days of receipt of such written notice,
and (iii) Executive thereafter resigns and ceases to perform services as an
employee of the Company within ten (10) days of the expiration of the Company’s
cure period.
(f)    “Plan” means an applicable equity incentive plan maintained by the
Company.
(g)    “Release Conditions” mean the following conditions: (i) Company has
received the Executive’s executed Release in substantially the form attached
hereto as Exhibit A, and (ii) any rescission period applicable to the
Executive’s executed Release has expired.
(h)    “Qualifying Termination” means a Separation that is not a CIC Qualifying
Termination, but which results from (i) the Company terminating the Executive’s
employment for any reason other than Cause or (ii) the Executive voluntarily
resigning his or her employment for Good Reason. A termination or resignation
due to the Executive’s death or disability shall not constitute a Qualifying
Termination.
(i)    “Separation” means a “separation from service,” as defined in the
regulations under Section 409A of the Code.
8.    Successors.
(a)    Company’s Successors. The Company shall require any successor (whether
direct or indirect and whether by purchase, lease, merger, consolidation,
liquidation or otherwise) to all or substantially all of the Company’s business
and/or assets, by an agreement in substance and form satisfactory to the
Executive, to assume this Agreement and to agree expressly to perform this

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Agreement in the same manner and to the same extent as the Company would be
required to perform it in the absence of a succession. For all purposes under
this Agreement, the term “Company” shall include any successor to the Company’s
business and/or assets or which becomes bound by this Agreement by operation of
law.
(b)    Executive’s Successors. This Agreement and all rights of the Executive
hereunder shall inure to the benefit of, and be enforceable by, the Executive’s
personal or legal representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees.
9.    Golden Parachute Taxes.
(a)    Best After-Tax Result. In the event that any payment or benefit received
or to be received by Executive pursuant to this Agreement or otherwise
(“Payments”) would (i) constitute a “parachute payment” within the meaning of
Section 280G of the Code and (ii) but for this subsection (a), be subject to the
excise tax imposed by Section 4999 of the Code, any successor provisions, or any
comparable federal, state, local or foreign excise tax (“Excise Tax”), then,
subject to the provisions of Section 10, such Payments shall be either (A)
provided in full pursuant to the terms of this Agreement or any other applicable
agreement, or (B) provided as to such lesser extent which would result in no
portion of such Payments being subject to the Excise Tax (“Reduced Amount”),
whichever of the foregoing amounts, taking into account the applicable federal,
state, local and foreign income, employment and other taxes and the Excise Tax
(including, without limitation, any interest or penalties on such taxes),
results in the receipt by Executive, on an after-tax basis, of the greatest
amount of payments and benefits provided for hereunder or otherwise,
notwithstanding that all or some portion of such Payments may be subject to the
Excise Tax. Unless the Company and Executive otherwise agree in writing, any
determination required under this Section shall be made by independent tax
counsel designated by the Company and reasonably acceptable to Executive
(“Independent Tax Counsel”), whose determination shall be conclusive and binding
upon Executive and the Company for all purposes. For purposes of making the
calculations required under this Section, Independent Tax Counsel may make
reasonable assumptions and approximations concerning applicable taxes and may
rely on reasonable, good faith interpretations concerning the application of
Sections 280G and 4999 of the Code; provided that Independent Tax Counsel shall
assume that Executive pays all taxes at the highest marginal rate. The Company
and Executive shall furnish to Independent Tax Counsel such information and
documents as Independent Tax Counsel may reasonably request in order to make a
determination under this Section. The Company shall bear all costs that
Independent Tax Counsel may reasonably incur in connection with any calculations
contemplated by this Section. In the event that Section 9(a)(ii)(B) above
applies, then based on the information provided to Executive and the Company by
Independent Tax Counsel, Executive may, in Executive’s sole discretion and
within thirty (30) days of the date on which Executive is provided with the
information prepared by Independent Tax Counsel, determine which and how much of
the Payments (including the accelerated vesting of equity compensation awards)
to be otherwise received by Executive shall be eliminated or reduced (as long as
after such determination the value (as calculated by Independent Tax Counsel in

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accordance with the provisions of Sections 280G and 4999 of the Code) of the
amounts payable or distributable to Executive equals the Reduced Amount). If the
Internal Revenue Service (the “IRS”) determines that any Payment is subject to
the Excise Tax, then Section 9(b) hereof shall apply, and the enforcement of
Section 9(b) shall be the exclusive remedy to the Company.
(b)    Adjustments. If, notwithstanding any reduction described in Section 9(a)
hereof (or in the absence of any such reduction), the IRS determines that
Executive is liable for the Excise Tax as a result of the receipt of one or more
Payments, then Executive shall be obligated to surrender or pay back to the
Company, within one-hundred twenty (120) days after a final IRS determination,
an amount of such payments or benefits equal to the “Repayment Amount.” The
Repayment Amount with respect to such Payments shall be the smallest such
amount, if any, as shall be required to be surrendered or paid to the Company so
that Executive’s net proceeds with respect to such Payments (after taking into
account the payment of the Excise Tax imposed on such Payments) shall be
maximized. Notwithstanding the foregoing, the Repayment Amount with respect to
such Payments shall be zero (0) if a Repayment Amount of more than zero (0)
would not eliminate the Excise Tax imposed on such Payments or if a Repayment
Amount of more than zero would not maximize the net amount received by Executive
from the Payments. If the Excise Tax is not eliminated pursuant to this Section
9(b), Executive shall pay the Excise Tax.
10.    Miscellaneous Provisions.
(a)    Section 409A. To the extent (i) any payments to which Executive becomes
entitled under this Agreement, or any agreement or plan referenced herein, in
connection with Executive’s termination of employment with the Company
constitute deferred compensation subject to Section 409A of the Code and (ii)
Executive is deemed at the time of such termination of employment to be a
“specified” employee under Section 409A of the Code, then such payment or
payments shall not be made or commence until the earlier of (i) the expiration
of the six (6)-month period measured from the Executive’s Separation; or (ii)
the date of Executive’s death following such Separation; provided, however, that
such deferral shall only be effected to the extent required to avoid adverse tax
treatment to Executive, including (without limitation) the additional twenty
percent (20%) tax for which Executive would otherwise be liable under Section
409A(a)(1)(B) of the Code in the absence of such deferral. Upon the expiration
of the applicable deferral period, any payments which would have otherwise been
made during that period (whether in a single sum or in installments) in the
absence of this paragraph shall be paid to Executive or Executive’s beneficiary
in one lump sum (without interest). Except as otherwise expressly provided
herein, to the extent any expense reimbursement or the provision of any in-kind
benefit under this Agreement (or otherwise referenced herein) is determined to
be subject to (and not exempt from) Section 409A of the Code, the amount of any
such expenses eligible for reimbursement, or the provision of any in-kind
benefit, in one calendar year shall not affect the expenses eligible for
reimbursement or in kind benefits to be provided in any other calendar year, in
no event shall any expenses be reimbursed after the last day of the calendar
year following the calendar year in which Executive incurred such expenses, and
in no event shall any right to reimbursement or the provision of any in-kind
benefit be subject to

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liquidation or exchange for another benefit. To the extent that any provision of
this Agreement is ambiguous as to its exemption or compliance with Section 409A,
the provision will be read in such a manner so that all payments hereunder are
exempt from Section 409A to the maximum permissible extent, and for any payments
where such construction is not tenable, that those payments comply with Section
409A to the maximum permissible extent. To the extent any payment under this
Agreement may be classified as a “short-term deferral” within the meaning of
Section 409A, such payment shall be deemed a short-term deferral, even if it may
also qualify for an exemption from Section 409A under another provision of
Section 409A. Payments pursuant to this Agreement (or referenced in this
Agreement) are intended to constitute separate payments for purposes of Section
1.409A-2(b)(2) of the regulations under Section 409A.
(b)    Other Arrangements. This Agreement supersedes any and all cash severance
arrangements and vesting acceleration arrangements on change in control under
any agreement governing Equity Awards, severance and salary continuation
arrangements, programs and plans which were previously offered, or may be
offered on the Effective Date or thereafter, by the Company to the Executive,
including change in control severance arrangements and vesting acceleration
arrangements pursuant to an agreement governing Equity Awards, employment
agreement or offer letter, and Executive hereby waives Executive’s rights to
such other benefits. In no event shall any individual receive cash severance
benefits under both this Agreement and any other vesting acceleration
arrangement, severance pay or salary continuation program, plan or other
arrangement with the Company. For the avoidance of doubt, in no event shall
Executive receive (i) payment under both Section 2 and Section 3 and/or (ii)
acceleration of Equity Award vesting under both (a) Section 3(b)(i) and (b)
Section 3(b)(ii), as applicable, in each case with respect to Executive’s
Separation.
(c)    Dispute Resolution. To ensure rapid and economical resolution of any and
all disputes that might arise in connection with this Agreement, Executive and
the Company agree that any and all disputes, claims, and causes of action, in
law or equity, arising from or relating to this Agreement or its enforcement,
performance, breach, or interpretation, will be resolved solely and exclusively
by final, binding, and confidential arbitration, by a single arbitrator, in San
Diego County, and conducted by Judicial Arbitration & Mediation Services, Inc.
(“JAMS”) under its then-existing employment rules and procedures, which are
available at http://www.jamsadr.com/rules-employment-arbitration/, and the
Company will provide a copy upon Executive’s request, as the exclusive remedy
for resolving any and all such disputes. Nothing in this section, however, is
intended to prevent either party from obtaining injunctive relief in court to
prevent irreparable harm pending the conclusion of any such arbitration. Each
party to an arbitration or litigation hereunder shall be responsible for the
payment of its own attorneys’ fees. EXECUTIVE AND THE COMPANY UNDERSTAND THAT BY
AGREEING TO ARBITRATE ANY ARBITRATION CLAIM, THEY WILL NOT HAVE THE RIGHT TO
HAVE ANY ARBITRATION CLAIM DECIDED BY A JURY OR A COURT, BUT SHALL INSTEAD HAVE
ANY ARBITRATION CLAIM DECIDED THROUGH ARBITRATION. EXECUTIVE AND THE COMPANY
WAIVE ANY CONSTITUTIONAL OR OTHER RIGHT TO BRING CLAIMS COVERED BY THIS
AGREEMENT OTHER THAN IN THEIR INDIVIDUAL CAPACITIES. EXCEPT AS MAY BE PROHIBITED
BY LAW, THIS WAIVER INCLUDES THE ABILITY TO ASSERT

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CLAIMS AS A PLAINTIFF OR CLASS MEMBER IN ANY PURPORTED CLASS OR REPRESENTATIVE
PROCEEDING.
(d)    Notice. Notices and all other communications contemplated by this
Agreement shall be in writing and shall be deemed to have been duly given when
personally delivered or when mailed by U.S. registered or certified mail, return
receipt requested and postage prepaid or deposited with Federal Express
Corporation, with shipping charges prepaid. In the case of the Executive, mailed
notices shall be addressed to him or her at the home address which he or she
most recently communicated to the Company in writing. In the case of the
Company, mailed notices shall be addressed to its corporate headquarters, and
all notices shall be directed to the attention of its Secretary.
(e)    Waiver. No provision of this Agreement shall be modified, waived or
discharged unless the modification, waiver or discharge is agreed to in writing
and signed by the Executive and by an authorized officer of the Company (other
than the Executive). No waiver by either party of any breach of, or of
compliance with, any condition or provision of this Agreement by the other party
shall be considered a waiver of any other condition or provision or of the same
condition or provision at another time.
(f)    Withholding Taxes. All payments made under this Agreement shall be
subject to reduction to reflect taxes or other charges required to be withheld
by law.
(g)    Severability. The invalidity or unenforceability of any provision or
provisions of this Agreement shall not affect the validity or enforceability of
any other provision hereof, which shall remain in full force and effect.
(h)    No Retention Rights. Nothing in this Agreement shall confer upon the
Executive any right to continue in service for any period of specific duration
or interfere with or otherwise restrict in any way the rights of the Company or
any subsidiary of the Company or of the Executive, which rights are hereby
expressly reserved by each, to terminate his or her service at any time and for
any reason, or no reason, with or without Cause.
(i)    Choice of Law. The validity, interpretation, construction and performance
of this Agreement shall be governed by the laws of the State of California
(other than its choice-of-law provisions).
(j)    Survival. Section 6(a) (Non-Competition), Section 6(b) (Cooperation and
Non-Disparagement), Section 8 (Successors), Section 9 (Golden Taxes Parachute),
Section 10(c) (Dispute Resolution) and Section 10(k) (Exceptions) hereof shall
survive any termination of this Agreement and shall continue in effect.
(k)    Exceptions. Notwithstanding anything in this Agreement or the Release to
the contrary, nothing contained in this Agreement or the Release shall prohibit
Executive from (i) filing a charge with, reporting possible violations of
federal law or regulation to, participating in any

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investigation by, or cooperating with any governmental agency or entity or
making other disclosures that are protected under the whistleblower provisions
of applicable law or regulation and/or (ii) communicating directly with,
cooperating with, or providing information (including trade secrets) in
confidence to, any federal, state or local government regulator (including, but
not limited to, the U.S. Securities and Exchange Commission, the U.S. Commodity
Futures Trading Commission, or the U.S. Department of Justice) for the purpose
of reporting or investigating a suspected violation of law, or from providing
such information to Executive’s attorney or in a sealed complaint or other
document filed in a lawsuit or other governmental proceeding. Pursuant to 18 USC
Section 1833(b), Executive will not be held criminally or civilly liable under
any federal or state trade secret law for the disclosure of a trade secret that
is made: (x) in confidence to a federal, state, or local government official,
either directly or indirectly, or to an attorney, and solely for the purpose of
reporting or investigating a suspected violation of law; or (y) in a complaint
or other document filed in a lawsuit or other proceeding, if such filing is made
under seal.

11

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IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case
of the Company by its duly authorized officer, as of the day and year first
above written.
EXECUTIVE
OBALON THERAPEUTICS, INC.
                                                                                
 
[                                                                             ]
By: Andrew Rasdal
Title: Chief Executive Officer

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Exhibit A
GENERAL RELEASE OF ALL CLAIMS AND COVENANT NOT TO SUE
This General Release of All Claims and Covenant Not to Sue (the “Release”) is
entered into between [__________________] (“Executive”) and Obalon Therapeutics,
Inc. (the “Company”) (collectively, “the parties”).
WHEREAS, on [______________], Executive and the Company entered into a Retention
Agreement with the Company (the “Retention Agreement,” to which this Release is
attached as Exhibit A);
WHEREAS, on     , Executive’s employment with the Company terminated (the
“Separation Date”);
WHEREAS, this agreement serves as the Release, pursuant to the Retention
Agreement; and
WHEREAS, Executive and the Company desire to mutually, amicably and finally
resolve and compromise all issues and claims surrounding Executive’s employment
and separation from employment with the Company;
NOW THEREFORE, in consideration for the mutual promises and undertakings of the
parties as set forth below, Executive and the Company hereby enter into this
Release.
1.Acknowledgment of Payment of Wages: By his signature below, Executive
acknowledges that, on the Separation Date, the Company paid him for all wages,
salary, bonuses, commissions, reimbursable expenses, accrued but unused vacation
and any similar payments due him from the Company as of the Separation Date. By
signing below, Executive acknowledges that the Company does not owe him any
other amounts, except as may become payable under the Retention Agreement and
the Release.
2.    Return of Company Property: Executive hereby warrants to the Company that
he has returned to the Company all property or data of the Company of any type
whatsoever that has been in his possession, custody or control.
3.    Consideration: In exchange for Executive’s agreement to this Release and
his other promises in the Retention Agreement and herein, and pursuant to the
Retention Agreement, the Company agrees to provide Executive with the
consideration set forth in Section          of the Retention Agreement. By
signing below, Executive acknowledges that he is receiving the consideration in
exchange for waiving his rights to claims referred to in this Release.
4.    General Release and Waiver of Claims:

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a.    The payments and promises set forth in this Release are in full
satisfaction of all accrued salary, vacation pay, bonus and commission pay,
profit-sharing, stock, stock options, restricted stock units or other ownership
interest in the Company, termination benefits or other compensation to which
Executive may be entitled by virtue of his employment with the Company or his
separation from the Company, including pursuant to the Retention Agreement. To
the fullest extent permitted by law, Executive hereby releases and waives any
other claims he may have against the Company and its owners, agents, officers,
shareholders, employees, directors, attorneys, subscribers, subsidiaries,
affiliates, successors and assigns (collectively “Releasees”), whether known or
not known, including, without limitation, claims under any employment laws,
including, but not limited to, claims of unlawful discharge, breach of contract,
breach of the covenant of good faith and fair dealing, fraud, violation of
public policy, defamation, physical injury, emotional distress, claims for
additional compensation or benefits arising out of his employment or separation
of employment, including pursuant to the Offer Letter, claims under Title VII of
the 1964 Civil Rights Act, as amended, the California Fair Employment and
Housing Act and any other laws and/or regulations relating to employment or
employment discrimination, including, without limitation, claims based on age or
under the Age Discrimination in Employment Act or Older Workers Benefit
Protection Act, and/or claims based on disability or under the Americans with
Disabilities Act.
b.    By signing below, Executive expressly waives any benefits of Section 1542
of the Civil Code of the State of California, which provides as follows:
“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF
KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR.”
c.    Executive and the Company do not intend to release claims that he may not
release as a matter of law, including but not limited to claims for indemnity
under California Labor Code Section 2802, or any claims for enforcement of this
Release. To the fullest extent permitted by law, any dispute regarding the scope
of this general release shall be determined by an arbitrator under the
procedures set forth in the Dispute Resolution section set forth in the
Retention Agreement.
5.    Covenant Not to Sue:
a.    To the fullest extent permitted by law, at no time subsequent to the
execution of this Release will Executive pursue, or cause or knowingly permit
the prosecution, in any state, federal or foreign court, or before any local,
state, federal or foreign administrative agency, or any other tribunal, of any
charge, claim or action of any kind, nature and character whatsoever, known or
unknown, which he may now have, have ever had, or may in the future have against
Releasees, which is based in whole or in part on any matter released by this
Release.
b.    Nothing in this paragraph shall prohibit Executive from filing a charge or
complaint with a government agency where, as a matter of law, the parties may
not restrict his right

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to file such administrative complaints. However, Executive understands and
agrees that, by entering into this Release, he is releasing any and all
individual claims for relief, and that any and all subsequent disputes between
Executive and the Company shall be resolved through arbitration as provided in
the Retention Agreement.
c.    Nothing in this paragraph shall prohibit or impair Executive or the
Company from complying with all applicable laws, nor shall this Release be
construed to obligate either party to commit (or aid or abet in the commission
of) any unlawful act.
6.    Review of Release: Executive understands that he may take up to twenty-one
(21) days to consider this Release and, by signing below, affirms that he was
advised to consult with an attorney prior to signing this Release. Executive
also understands that he may revoke this Release within seven (7) days of
signing this document and that the consideration to be provided to him pursuant
to Paragraph 2(c) of the Retention Agreement will be provided only at the end of
that seven (7) day revocation period.
7.    Effective Date: This Release is effective on the eighth (8th) day after
Executive signs it, provided he has not revoked it as of that time.
8.    Other Terms of Retention Agreement Incorporated Herein: All other terms of
the Retention Agreement to the extent not inconsistent with the terms of this
Release are hereby incorporated in this Release as though fully stated herein
and apply with equal force to this Release, including, without limitation, the
provisions on Non-Competition, Cooperation and Non-Disparagement, Section 409A,
Dispute Resolution, Choice of Law and Exceptions.
Dated:
                                                                          
                                                                          
Name:
Title:
For the company
Dated:
                                                                          
                                                                          
Name: [______________________________]