Exhibit 10.1

VITAL THERAPIES, INC.
OUTSIDE DIRECTOR COMPENSATION POLICY
Adopted and approved May 13, 2013
As Amended March 18, 2015, December 18, 2015 and May 24, 2016
Vital Therapies, Inc. (the “Company”) believes that the granting of equity and
cash compensation to its members of the Board of Directors (the “Board,” and
members of the Board, the “Directors”) represents an effective tool to attract,
retain and reward Directors who are not employees of the Company (the “Outside
Directors”). This Outside Director Compensation Policy (the “Policy”) is
intended to formalize the Company’s policy regarding cash compensation and
grants of equity to its Outside Directors. . This Policy is effective as of the
date set forth above, with the amendments effective as of the amendment date set
forth above.
Unless otherwise defined herein, capitalized terms used in this Policy will have
the meaning given such term in the Company’s 2014 Equity Incentive Plan (as may
be amended from time to time, the “Plan”). Each Outside Director will be solely
responsible for any tax obligations incurred by such Outside Director as a
result of the equity and cash payments such Outside Director receives under this
Policy.
1.
CASH COMPENSATION

Annual Cash Retainer
Each Outside Director will be paid an annual cash retainer of $35,000. The
Non-Executive Chairman of the Board will be paid an annual cash retainer of
$50,000. This cash compensation will be paid quarterly in arrears on a prorated
basis.
Committee Annual Cash Retainer
Each Outside Director who serves as the chairman or a member of a committee of
the Board will be eligible to earn additional annual fees (paid quarterly in
arrears on a prorated basis) as follows:
Chairman of Audit Committee:            $7,500    
Member of Audit Committee:            $7,500    
Chairman of Compensation Committee:        $5,000    
Member of Compensation Committee:        $5,000    
Chairman of Nominating and Governance Committee:        $5,000    
Member of Nominating and Governance Committee:        $5,000    
Chairman of Quality and Technology Committee:        $5,000    
Member of Quality and Technology Committee:        $5,000    

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For clarity, each Outside Director who serves as the chairman of a committee
will receive both the additional annual fee as the chairman of the committee and
the additional annual fee as a member of the committee.

Board Meeting Fees

Each Outside Director will be paid a per-meeting attendance fee of $500 for
attending telephonic meetings of the Board. In addition, each Outside Director
will be paid a per-meeting attendance fee of $2,500 for attending in-person
meetings of the Board in excess of four (4) in-person meetings during each
calendar year. For clarity, there are no per-meeting attendance fees for
attending meetings of the committees of the Board.
2.
EQUITY COMPENSATION

Outside Directors will be entitled to receive all types of Awards (except
Incentive Stock Options) under the Plan (or the applicable equity plan in place
at the time of grant), including discretionary Awards not covered under this
Policy. All grants of Awards to Outside Directors pursuant to Sections 2(b) and
(c) of this Policy will be automatic and nondiscretionary, except as otherwise
provided herein, and will be made in accordance with the following provisions:
(a)    No Discretion. No person will have any discretion to select which Outside
Directors will be granted any Awards under this Policy or to determine the
number of Shares to be covered by such Awards.
(b)    Initial Awards. Subject to Section 11 of the Plan, on the date on which
any person first becomes an Outside Director, he or she automatically will be
granted a Nonstatutory Stock Option with a Black-Scholes value of approximately
$250,000 and the number of shares covered by such option rounded down to the
nearest whole share (an “Initial Award”). Subject to Section 5 below and
Section 14 of the Plan, each Initial Award will vest monthly in 48 equal
installments beginning with the first month following the grant date (on the
same day of the month as the grant date and if there is no corresponding date,
then the last day of the month) and continuing for each month thereafter, in
each case, provided that the Outside Director continues to serve as a Service
Provider through the applicable vesting date.
(c)    Annual Awards. Subject to Section 11 of the Plan, on the date of each
Annual Meeting of the Company’s stockholders (the “Annual Meeting”) beginning
with the 2016 Annual Meeting, each Outside Director who was a Director for the
entire 6-month period preceding an Annual Meeting automatically will be granted
a Nonstatutory Stock Option with a Black-Scholes value of approximately $125,000
or $175,000 in the case of the Non-Executive Chairman of the Board and the
number of shares covered by such option rounded down to the nearest whole share
(an “Annual Award”). Subject to Section 5 below and Section 14 of the Plan, each
Annual Award will fully vest on the earlier of (i) the 1-year anniversary of its
grant date or (ii) the day prior to the next Annual Meeting, provided that the
Outside Director continues to serve as a Service Provider through the applicable
vesting date.
(d)    Terms Applicable to all Options Granted Under this Policy. The per share
exercise price for an Option granted under this Outside Director Compensation
Policy will be 100% of the Fair Market Value on the grant date.
3.
TRAVEL EXPENSES

Each Outside Director’s reasonable, customary, and documented travel expenses to
Board meetings will be reimbursed by the Company.

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4.
ADDITIONAL PROVISIONS

All provisions of the Plan not inconsistent with this Policy will apply to
Awards granted to Outside Directors.
5.
ADJUSTMENTS

In the event that any recapitalization, stock split, reverse stock split, stock
dividend, reorganization, merger, consolidation, split-up, spin-off,
combination, repurchase, or exchange of Shares or other securities of the
Company, or other change in the corporate structure of the Company affecting the
Shares occurs, the Administrator, in order to prevent diminution or enlargement
of the benefits or potential benefits intended to be made available under this
Policy, will adjust the number of Shares issuable pursuant to then outstanding
Awards granted under this Policy as provided in the Plan. For the avoidance of
doubt, the foregoing adjustment will not result in any adjustment to the
Black-Scholes values as set forth in paragraphs 2(b) and 2(c) herein.
6.
REVISIONS

The Compensation Committee in its discretion may change and otherwise revise the
terms of Awards granted under this Policy, including, without limitation, the
number of Shares subject thereto, for Awards of the same or different type
granted on or after the date the Compensation Committee determines to make any
such change or revision.