Document:

FORBEARANCE
AGREEMENT

 

This
FORBEARANCE AGREEMENT (this “Agreement”) is entered into as of the 11thday of January 2019
(the “Effective Date”), by and between Sun Pacific Holding Corp., a Nevada corporation (the “Borrower”)
and Nicholas Campanella, a resident of Manapalan, New Jersey (the “Lender”).

 

WHEREAS,
the Borrower and the Lender are parties to a certain Convertible Promissory Note and a Line of Credit, assumed by the Borrower
upon the acquisition of Sun Pacific Power Corp. (as the same may from time to time be amended, modified, supplemented or restated,
the “Financing Agreements” or “Financing Documents”) pursuant to which the Lender made a series
of loans to the Borrower in the original principal amount of $332,474.00 and $135,528.00, respectively (the “Loans”).

 

WHEREAS,
the outstanding principal balance plus accrued interest owed by the Borrower to the Lender under the Loan is $648,417.89;

 

WHEREAS,
the Borrower is in default under the Financing Agreements;

 

WHEREAS,
the Borrower has requested that the Lender forbear from exercising its rights and remedies under the Financing Agreement; and

 

WHEREAS,
the Lender is willing to forbear from exercising such rights and remedies, provided that the Borrower comply with the terms and
conditions of this Agreement.

 

NOW,
THEREFORE, in consideration of the mutual covenants, terms and conditions set forth herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

 

1.
Borrower Acknowledgments. The Borrower acknowledges and agrees that:

 

(a)
Defaults. The Borrower is in Default in various forms per the terms of the Financing Agreements, generally.

 

(b)
Indebtedness. As of the Effective Date, the outstanding principal balance plus accrued interest owed by the Borrower to
the Lender under the Loans is $648,417.89.

 

(c)
Right to Accelerate Obligations. As a result of the Existing Defaults, the Lender has the right to accelerate the maturity
and demand immediate payment of the Obligations.

 

(d)
Default Interest Rate. As a result of the Existing Defaults, the Lender has the right to impose the default rate of interest
under the terms of the Financing Documents.

 

2.
Forbearance.

 

(a)
Consideration for the Forbearance. As consideration for the forbearance of the Loans, the Borrower hereby grants a security
interest to any and all equity holdings or interests otherwise in the Borrower’s wholly owned subsidiary, MedRecycler, LLC,
a Nevada limited liability company and the holding company of the Borrower’s waste to energy business (the “Collateral”).
As evidence of the Collateral, the Borrower shall deliver to Eilers Law Group, P.A, acting as escrow agent (the “Escrow
Agent”), such documentation effectuating the transfer of the Collateral, in whole or in part, to the Lender.

 

(b)
Forbearance Period. Subject to the terms and conditions set forth herein, the Lender shall forbear from exercising its
rights and remedies against the Borrower under the Financing Documents with respect to the Existing Defaults during the period
(the “Forbearance Period”) commencing on the Effective Date and ending on the earlier to occur of (i) December
31, 2019, (ii) failure of the Borrower to comply with any of the terms or undertakings of this Agreement, and (iii) the occurrence
after the Effective Date of any Event of Default (other than the Existing Defaults).

 

    	 	 	 

     

    

 

(c)
No Waiver of Defaults; Preservation of Rights and Remedies. Except as expressly provided herein, this Agreement does not
constitute a waiver or release by the Lender of any Obligations or of the Existing Defaults or any other present or future Event
of Default. If the Borrower does not comply with the terms of this Agreement, the Lender shall have no further obligations under
this Agreement and shall be permitted to exercise at such time any rights and remedies against the Borrower as it deems appropriate.

 

(d)
Scope of Forbearance. During the Forbearance Period, the Lender will not (i) accelerate the maturity of the Obligations
or initiate proceedings to collect the Obligations, (ii) initiate or join in filing any involuntary bankruptcy petition with respect
to the Borrower under the Bankruptcy Code, or otherwise file or participate in any insolvency, reorganization, moratorium, receivership
or other similar proceedings against Borrower under the laws of the United States, or (iii) repossess or dispose of any of the
Collateral, through judicial proceedings or otherwise.

 

(e)
Foreclosure on Collateral. If, upon termination of the Forbearance Period, the Borrower becomes in Default under the terms
of the Financing Documents or otherwise is subject to bankruptcy proceedings, seizure, or is otherwise deemed “insolvent”,
the Lender may, at his own discretion, without action of the Court, the Borrower shall instruct the Escrow Agent to take such
action as required to perfect the Borrower’s interest in the Collateral within five (5) days.

 

3.
Conditions Precedent. The effectiveness of this Agreement and the forbearance described herein is subject to execution
of the Forbearance Documents by all parties thereto and delivery of such executed Forbearance Documents to each other person that
is a party thereto.

 

4.
Representations and Warranties. The Borrower represents and warrants that all representations and warranties contained
in the Financing Documents are true and correct as of the Effective Date, other than to the extent (i) such representations and
warranties expressly relate to an earlier date, in which case such representations and warranties shall have been true and correct
in all material respects as of such earlier date, or (ii) set forth on the disclosure schedules attached hereto (the “Updated
Disclosure Schedules”, the numbers of which correspond to the numbers ascribed to such disclosure schedules in the Financing
Agreement). The Borrower further represents and warrants to the Lender as follows:

 

(a)
Authorization. The execution, delivery and performance of this Agreement are within its corporate power and have been duly
authorized by all necessary corporate action.

 

(b)
Enforceability. This Agreement constitutes a valid and legally binding Agreement enforceable against the Borrower in accordance
with its terms, subject to the effects of bankruptcy, insolvency, fraudulent conveyance and similar laws affecting creditors’
rights generally and to general principles of equity.

 

(c)
No Violation. The execution, delivery and performance of this Agreement do not and will not (i) violate any law, regulation
or court order to which the Borrower is subject; (ii) conflict with the Borrower Organic Documents; or (iii) result in the creation
or imposition of any lien, security interest or encumbrance on any property of the Borrower, whether now owned or hereafter acquired,
other than

 

(d)
No Litigation. No action, suit, litigation, investigation or proceeding of or before any arbitrator or Governmental Authority
is pending or, to the knowledge of the Borrower, threatened by or against or affecting the Borrower or any of its property or
assets with respect to any of the Financing Documents or any of the transactions contemplated hereby or thereby.

 

    	 	 	 

     

    

 

5.
Miscellaneous.

 

(a)
Notices. Any notices with respect to this Agreement shall be given in the manner provided for in Section 10.6 of the Financing
Agreement; provided that notices to the Borrower shall be addressed as follows:

 

if
to the Borrower:

Sun
Pacific Holding Corp.

 

Attn.:

Email:

 

if
to the Lender:

Nicholas
Campanella

 

Attn.:

Email:

 

(b)
Integration; Modification of Agreement. This Agreement, the Forbearance Documents and the Financing Documents embody the
entire understanding between the parties hereto and supersedes all prior agreements and understandings (whether written or oral)
relating to the subject matter hereof and thereof. The terms of this Agreement may not be waived, modified, altered or amended
except by agreement in writing signed by all the parties hereto. This Agreement shall not be construed against the drafter hereof.

 

(c)
Severability. If any term or provision of this Agreement is invalid, illegal or unenforceable in any jurisdiction, such
invalidity, illegality or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render
unenforceable such term or provision in any other jurisdiction.

 

(d)
Full Force and Effect. The Financing Documents shall remain unchanged, in full force and effect and continue to govern
and control the relationship between the parties hereto, except to the extent they are inconsistent with, superseded or expressly
modified herein. To the extent of any inconsistency, amendment or superseding provision, this Agreement shall govern and control.

 

(e)
Successors and Assigns. This Agreement is binding upon and shall inure to the benefit of the parties hereto and their respective
heirs, successors and assigns; provided that the Borrower may not assign any rights or delegate any obligations arising herein
without the prior written consent of the Lender and any prohibited assignment shall be absolutely void. The Lender may assign
its rights and interests in this Agreement, the Forbearance Documents, the Financing Documents and all documents executed in connection
with or related to this Agreement, the Forbearance Documents or the Financing Documents, at any time without the consent of or
notice to the Borrower.

 

    	 	 	 

     

    

 

(f)
Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New York without
regard to conflict of laws principles thereof.

 

(g)
No Waiver. No failure to exercise and no delay in exercising, on the part of the Lender any right, remedy, power or privilege
hereunder or under the Forbearance Documents or the Financing Documents shall operate as a waiver thereof; nor shall any single
or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise
of any other right, remedy, power or privilege.

 

(h)
Consent to Jurisdiction; Venue; Service of Process.

 

(i)
Consent to Jurisdiction. The parties hereby irrevocably and unconditionally consent to the exclusive jurisdiction of the
state of New Jersey and of all New Jersey state courts, for the purpose of bringing any litigation, actions or proceedings in
any manner relating to or arising out of this Agreement or any of the Forbearance Documents.

 

(j)
Waiver of Venue. The parties hereby each waive any objection they may now or hereafter have to the laying of venue in such
court and irrevocably waive, to the fullest extent permitted by applicable law, the defense of forum non conveniens to the maintenance
of such action or proceeding in any such court.

 

(k)
Service of Process. The parties each hereby irrevocably consent to the service of process by certified or registered mail
sent to the address provided for notices in Section 5(a).

 

(l)
Waiver of Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY
RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY RELATING TO THIS AGREEMENT OR ANY FORBEARANCE
DOCUMENT OR ANY FINANCING DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY WHETHER BASED ON CONTRACT, TORT OR ANY OTHER
THEORY. EACH PARTY HERETO (A) CERTIFIES THAT NO AGENT, ATTORNEY, REPRESENTATIVE OR ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT SEEK TO ENFORCE THE FOREGOING WAIVER IN THE EVENT OF LITIGATION, AND (B) ACKNOWLEDGES
THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO THIS AGREEMENT.

 

(m)
Headings. The section headings in this Agreement are for reference only and shall not affect the interpretation of this
Agreement.

 

(n)
Counterparts; Electronic Execution. This Agreement may be executed in any number of counterparts, each of which shall be
an original, and all of which together shall constitute one and the same instrument. Delivery of an executed counterpart of a
signature page to this Agreement by facsimile or in electronic (i.e., “pdf” or “tif”) format shall be
effective as delivery of a manually executed counterpart of this Agreement.

 

[Intentionally
left blank Signature pages follow.]

 

    	 	 	 

     

    

 

IN
WITNESS WHEREOF, the parties hereto have caused this Forbearance Agreement to be executed as of the date first set forth above.

 

	 	BORROWER
	 	 	 
	 	SUN
    PACIFIC HOLDING CORP
	 	 	 
	 	By:	/s/
    Vincent Randazzo
	 	 	Vincent
    Randazzo
	 	 	Director
	 	 	 
	 	LENDER
    
	 	 	 
	 	NICHOLAS
    CAMPANELLA
	 	 	 
	 	By:	/s/
    Nicholas Campanella
	 	Name:	Nicholas
    Campanella
	 	Title:	Personallyvitalformofrsuagreement2

                                                                                                                                                                                                   VITAL THERAPIES, INC.                           2014 EQUITY INCENTIVE PLAN                  RESTRICTED STOCK UNIT AWARD AGREEMENT                   NOTICE OF GRANT OF RESTRICTED STOCK UNITS         Unless  otherwise defined herein, the terms defined in  the 2014 Equity  Incentive Plan (the  “Plan”)  shall  have  the  same  defined  meanings  in  this  Restricted  Stock  Unit  Award  Agreement,  including the  Notice  of  Grant  of  Restricted  Stock  Units  (the  “Notice  of  Grant”),  the  Terms  and  Conditions  of  Restricted  Stock  Unit  Grant,  and  any  appendices  and  exhibits attached  thereto  (all  together, the “Award Agreement”).         Name (“Participant):          «Name»        Address:                      «Address»         The undersigned Participant has been granted the right to receive an Award of Restricted Stock  Units, subject to the terms and conditions of the Plan and this Award Agreement, as follows:         Date of Grant:                «GrantDate»         Vesting Commencement Date:    «VCD»         Number of Restricted Stock Units: «Shares»         Vesting Schedule:         Subject to any acceleration provisions contained in the Plan, any other agreement, or set forth  below, the Restricted Stock Units will vest in accordance with the following schedule:         <<Insert vesting schedule>>         In the event Participant ceases to be a Service Provider for any or no reason before Participant  vests in the Restricted Stock Units, the Restricted Stock Units and Participant’s right to acquire any  Shares hereunder will immediately terminate.         Participant acknowledges receipt of a copy of the Plan and represents that he or she is familiar  with the terms and provisions thereof, and hereby accepts this Award Agreement subject to all of the  terms and provisions thereof.  Participant has reviewed the Plan and this Award Agreement in their  entirety,  has  had  an  opportunity  to  obtain  the  advice  of  counsel  prior  to  executing  this  Award  Agreement and fully understands all provisions of this Award Agreement.  Participant hereby agrees  to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon  any questions arising under the Plan or this Award Agreement.  Participant further agrees to notify the  Company upon any change in the residence address indicated below.                                                                  

 

PARTICIPANT                               VITAL THERAPIES, INC.                                                                                       Signature                                 By  «Name»                                                                            Print Name                                Print Name                                                                                           Title  Address:                                      «Address»                                             

 

                                                                                                                                                                                                   VITAL THERAPIES, INC.                           2014 EQUITY INCENTIVE PLAN                  RESTRICTED STOCK UNIT AWARD AGREEMENT            TERMS AND CONDITIONS OF RESTRICTED STOCK UNIT GRANT         1. Grant  of  Restricted  Stock  Units.   The  Company  hereby  grants  to  the  individual  (the  “Participant”) named in the Notice of Grant of Restricted Stock Units of this Award Agreement (the  “Notice of Grant”) under the Plan an Award of Restricted Stock Units, subject to all of the terms and  conditions in this Award Agreement and the Plan, which is incorporated herein by reference.  Subject  to Section 19(c) of the Plan, in the event of a conflict between the terms and conditions of the Plan  and this Award Agreement, the terms and conditions of the Plan shall prevail.         2. Company’s Obligation to Pay.  Each Restricted Stock Unit represents the right to receive  cash, Shares, or a combination of both, as provided in Section 4(a) below, provided, however, that if  on the date of settlement the Shares are no longer traded on the Nasdaq market, then the Restricted  Stock Units shall be settled in cash.  Unless and until the Restricted Stock Units will have vested in  the manner set forth in Section 3 or 4, Participant will have no right to payment of any such Restricted  Stock Units.  Prior to actual payment of any vested Restricted Stock Units, such Restricted Stock Unit  will represent an unsecured obligation of the Company, payable (if at all) only from the general assets  of the Company.         3. Vesting Schedule.  Except as provided in Section 4, and subject to Section 5, the Restricted  Stock Units awarded by this Award Agreement will vest in accordance with the vesting schedule set  forth in the Notice of Grant, subject to Participant continuing to be a Service Provider through each  applicable vesting date.         4. Payment after Vesting.               (a) General Rule.  Subject to Section 6, any Restricted Stock Units that vest will be  paid to Participant (or in the event of Participant’s death, to his or her properly designated beneficiary  or estate) in cash, Shares, or a combination of both. Subject to the provisions of Section 4(b), (i) if  cash is paid to Participant to settle any vested Restricted Stock Units, such cash payment shall be paid  as soon as practicable after vesting, but in each such case, within sixty (60) days following the vesting  date, or (ii) if Shares are paid to Participant to settle any vested Restricted Stock Units, such Shares  shall be paid no earlier than ninety (90) days, and no later than one hundred twenty (120) days, after  the vesting date and, in the case of clause (ii), in no case later than March 15th of the year following  the applicable vesting date.  In no event will Participant be permitted, directly or indirectly, to specify  the taxable year of payment of any Restricted Stock Units payable under this Award Agreement.               (b) Acceleration.                         (i)     Discretionary Acceleration.  The Administrator, in its discretion,  may  accelerate  the  vesting  of  the  balance,  or  some  lesser  portion  of  the  balance,  of  the  unvested  Restricted Stock Units at any time, subject to the terms of the Plan. If so accelerated, such Restricted  Stock Units will be considered as having vested as of the date specified by the Administrator.  If  Participant is a U.S. taxpayer, the payment of Shares vesting pursuant to this Section 4(b) shall in all                                               

 

cases be paid at a time or in a manner that is exempt from, or complies with, Section 409A.  The prior  sentence may be superseded in a future agreement or amendment to this Award Agreement only by  direct and specific reference to such sentence.                         (ii)     Notwithstanding anything in the Plan or this Award Agreement  or any other agreement (whether entered into before, on or after the Date of Grant), if the vesting of  the balance, or some lesser portion  of the balance, of the Restricted Stock Units is accelerated in  connection with Participant’s termination as a Service Provider (provided that such termination is a  “separation from service” within the meaning of Section 409A, as determined by the Company), other  than due to Participant’s death, and if (x) Participant is a U.S. taxpayer and a “specified employee”  within the meaning of Section 409A at the time of such termination as a Service Provider and (y) the  payment of such accelerated Restricted Stock Units will result in the imposition of additional tax under  Section  409A  if  paid  to  Participant  on  or  within  the  six  (6)  month  period  following  Participant’s  termination as a Service Provider, then the payment of such accelerated Restricted Stock Units will  not  be  made  until  the  date  six  (6)  months  and  one (1)  day  following  the  date  of  Participant’s  termination as a Service Provider, unless Participant dies following his or her termination as a Service  Provider, in which case, the Restricted Stock Units will be paid in Shares to Participant’s estate as  soon as practicable following his or her death.                (c) Section 409A.  It is the intent of this Award Agreement that it and all payments and  benefits to U.S. taxpayers hereunder be exempt from, or comply with, the requirements of Section  409A so that none of the Restricted Stock Units provided under this Award Agreement or Shares  issuable  thereunder  will  be  subject  to  the  additional  tax  imposed  under  Section  409A,  and  any  ambiguities herein will be interpreted to be so exempt or so comply.  Each payment payable under this  Award Agreement is intended to constitute a separate payment for purposes of Treasury Regulation  Section 1.409A-2(b)(2).  For purposes of this Award Agreement, “Section 409A” means Section 409A  of the Code, and any final Treasury Regulations and Internal Revenue Service guidance thereunder,  as each may be amended from time to time.         5. Forfeiture  Upon  Termination  as  a  Service  Provider.   Notwithstanding  any  contrary  provision of this Award Agreement, and subject to any acceleration provisions contained in the Plan  or any other agreement between Participant and the Company, if Participant ceases to be a Service  Provider  for  any  or  no  reason,  the  then-unvested  Restricted  Stock  Units  awarded  by  this  Award  Agreement will thereupon be forfeited at no cost to the Company and Participant will have no further  rights thereunder.         6. Death of Participant.  Any distribution or delivery to be made to Participant under this  Award  Agreement  will,  if  Participant  is  then  deceased,  be  made  to  Participant’s  designated  beneficiary, or if no beneficiary survives Participant, the administrator or executor of Participant’s  estate.  Any such transferee must furnish the Company with (a) written notice of his or her status as  transferee, and (b) evidence satisfactory to the Company to establish the validity of the transfer and  compliance with any laws or regulations pertaining to said transfer.         7. Tax Consequences.  Participant has reviewed with its own tax advisors the U.S. federal,  state, local and foreign tax consequences of this investment and the transactions contemplated by this  Award Agreement.  With respect to such matters, Participant relies solely on such advisors and not on  any statements or representations of the Company or any of its agents, written or oral.  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 Award  Agreement.         Tax Obligations               (a) Responsibility for Taxes.  Participant acknowledges that, regardless of any action  taken by the Company or, if different, Participant’s employer (the “Employer”), the ultimate liability  for any  tax  and/or  social  insurance  liability  obligations  and  requirements  in  connection  with the  Restricted Stock Units, including, without limitation, (a) all federal, state, and local taxes (including  the  Participant’s  Federal  Insurance  Contributions  Act  (FICA)  obligation)  that  are  required  to  be  withheld  by  the  Company  or  the  Employer  or  other payment  of  tax-related  items  related  to  Participant’s participation in the Plan and legally applicable to Participant, (b) the Participant’s and,  to the extent required by the Company (or Employer), the Company’s (or Employer’s) fringe benefit  tax liability, if any, associated with the grant, vesting, or exercise of the Restricted Stock Units or sale  of Shares, and (c) any other Company (or Employer) taxes the responsibility for which the Participant  has, or has agreed to bear, with respect to the Restricted Stock Units (or exercise thereof or issuance  of Shares thereunder) (collectively, the “Tax Obligations”), is and remains Participant’s responsibility  and may exceed the amount actually withheld by the Company or the Employer.  Participant further  acknowledges that the Company and/or the Employer (i) make no representations or undertakings  regarding the treatment of any Tax Obligations in connection with any aspect of the Restricted Stock  Units, including, but not limited to, the grant, vesting or settlement of the Restricted Stock Units, the  subsequent sale of Shares acquired pursuant to such settlement and the receipt of any dividends or  other distributions, and (ii) do not commit to and are under no obligation to structure the terms of the  grant or any aspect of the Restricted Stock Units to reduce or eliminate Participant’s liability for Tax  Obligations or achieve any particular tax result.  Further, if Participant is subject to Tax Obligations  in more than one jurisdiction between the Date of Grant and the date of any relevant taxable or tax  withholding event, as applicable, Participant acknowledges that the Company and/or the Employer (or  former employer, as applicable) may be required to withhold or account for Tax Obligations in more  than one jurisdiction.  If Participant fails to make satisfactory arrangements for the payment of any  required  Tax  Obligations  hereunder  at  the  time  of  the  applicable  taxable  event,  Participant  acknowledges and agrees that the Company may refuse to issue or deliver the Shares.               (b) Tax Withholding. When Shares are issued as payment for vested Restricted Stock  Units, Participant generally  will recognize immediate U.S.  taxable income if Participant is  a U.S.  taxpayer.  If Participant is a non-U.S. taxpayer, Participant will be subject to applicable taxes in his or  her jurisdiction.  Pursuant to such procedures as the Administrator may specify from time to time, the  Company  and/or  Employer  shall  withhold  the  minimum  amount  required  to  be  withheld  for  the  payment of Tax Obligations.  The Administrator, in its sole discretion and pursuant to such procedures  as it may specify from time to time, may permit Participant to satisfy such Tax Obligations, in whole  or in part (without limitation), if permissible by applicable local law, by (a) paying cash, (b) electing  to have the Company withhold otherwise deliverable Shares having a fair market value equal to the  amount  of  such  Tax  Obligations,  (c)  withholding  the  amount  of  such  Tax  Obligations  from  Participant’s  wages  or  other  cash  compensation  paid  to  Participant  by  the Company  and/or  the  Employer, (d) delivering to the Company already vested and owned Shares having a fair market value  equal to such Tax Obligations, or (e) selling a sufficient number of such Shares otherwise deliverable  to  Participant  through  such  means  as  the  Company  may  determine  in  its  sole  discretion  (whether  

 

through a broker or otherwise) equal to the amount of the Tax Obligations.  Further, if Participant is  subject to tax in more than one jurisdiction between the Date of Grant and a date of any relevant  taxable or tax withholding event, as applicable, Participant acknowledges and agrees that the Company  and/or the Employer (and/or former employer, as applicable) may be required to withhold or account  for tax in more than one jurisdiction. If Participant fails to make satisfactory arrangements for the  payment  of  such  Tax  Obligations  hereunder  at  the  time  any  applicable  Restricted  Stock  Units  otherwise are scheduled to vest pursuant to Sections 3 or 4, Participant will permanently forfeit such  Restricted Stock Units and any right to receive Shares thereunder and the Restricted Stock Units will  be returned to the Company at no cost to the Company.  Participant acknowledges and agrees that the  Company may refuse to deliver the Shares if such Tax Obligations are not delivered at the time they  are due.         8. Rights  as  Stockholder.   Neither  Participant  nor  any  person  claiming  under  or  through  Participant will have any of the rights or privileges of a stockholder of the Company in respect of any  Shares deliverable hereunder unless and until certificates representing such Shares (which may be in  book entry form) will have been issued, recorded on the records of the Company or its transfer agents  or  registrars,  and  delivered  to  Participant (including  through  electronic  delivery  to  a  brokerage  account).   After  such  issuance,  recordation  and  delivery,  Participant  will  have  all  the  rights  of  a  stockholder  of  the  Company  with  respect  to  voting  such  Shares  and  receipt  of  dividends  and  distributions on such Shares.         9. No  Guarantee  of  Continued  Service.   PARTICIPANT  ACKNOWLEDGES  AND  AGREES THAT THE VESTING OF THE RESTRICTED STOCK UNITS PURSUANT TO THE  VESTING  SCHEDULE  HEREOF  IS  EARNED  ONLY  BY  CONTINUING  AS  A  SERVICE  PROVIDER AT THE WILL OF THE COMPANY (OR THE EMPLOYER) AND NOT THROUGH  THE ACT OF BEING HIRED, BEING GRANTED THIS RESTRICTED STOCK UNIT AWARD  OR ACQUIRING SHARES HEREUNDER. PARTICIPANT FURTHER ACKNOWLEDGES AND  AGREES THAT THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREUNDER  AND THE VESTING SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS  OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR  THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND SHALL NOT INTERFERE IN  ANY WAY WITH PARTICIPANT’S  RIGHT  OR  THE RIGHT OF  THE COMPANY  (OR THE  EMPLOYER) TO TERMINATE PARTICIPANT’S RELATIONSHIP AS A SERVICE PROVIDER  AT ANY TIME, WITH OR WITHOUT CAUSE.         10. Grant is Not Transferable.  Except to the limited extent provided in Section 6, this grant  and  the  rights  and  privileges  conferred hereby  will  not  be  transferred,  assigned,  pledged  or  hypothecated in any way (whether by operation of law or otherwise) and will not be subject to sale  under  execution,  attachment  or  similar  process.   Upon  any  attempt  to  transfer,  assign,  pledge,  hypothecate or otherwise dispose of this grant, or any right or privilege conferred hereby, or upon any  attempted  sale  under  any  execution,  attachment  or  similar  process,  this  grant  and  the  rights  and  privileges conferred hereby immediately will become null and void.         11. Nature of Grant.  In accepting the grant, Participant acknowledges, understands and agrees  that:  

 

            (a) the grant of the Restricted Stock Units is voluntary and occasional and does not  create any contractual or other right to receive future grants of Restricted Stock Units, or benefits in  lieu of Restricted Stock Units, even if Restricted Stock Units have been granted in the past;                (b) all decisions with respect to future Restricted Stock Units or other grants, if any,  will be at the sole discretion of the Company;                (c) Participant is voluntarily participating in the Plan;                (d) the Restricted Stock Units and the Shares subject to the Restricted Stock Units, and  the  income  and  value  of  same,  are  not  part  of  normal  or  expected  compensation  for  purposes  of  calculating any severance, resignation, termination, redundancy, dismissal, end-of-service payments,  bonuses, long-service awards, pension or retirement or welfare benefits or similar payments;                (e) the future value of the underlying Shares is unknown, indeterminable and cannot  be predicted;                (f) for purposes of the Restricted Stock Units, Participant’s status as a Service Provider  will be considered terminated as of the date Participant is no longer actively providing services to the  Company or any Parent or Subsidiary (regardless of the reason for such termination and whether or  not later to be found invalid or in breach of employment laws in the jurisdiction where Participant is  a Service Provider or the terms of Participant’s employment or service agreement, if any), and unless  otherwise expressly provided in this Award Agreement (including by reference in the Notice of Grant  to other arrangements or contracts) or determined by the Administrator, Participant’s right to vest in  the Restricted Stock Units under the Plan, if any, will terminate as of such date and will not be extended  by any notice period (e.g., Participant’s period of service would not include any contractual notice  period or any period of “garden leave” or similar period mandated under employment laws in the  jurisdiction where Participant is a Service Provider or the terms of Participant’s employment or service  agreement,  if  any,  unless  Participant  is  providing  bona  fide  services  during  such  time);  the  Administrator shall have the exclusive discretion to determine when Participant is no longer actively  providing services for purposes of the Restricted Stock Units grant (including whether Participant may  still be considered to be providing services while on a leave of absence);                (g) unless  otherwise  provided  in  the  Plan  or  by  the  Company  in  its  discretion,  the  Restricted  Stock  Units and  the  benefits  evidenced  by  this  Award  Agreement  do  not  create  any  entitlement to have the Restricted Stock Units or any such benefits transferred to, or assumed by,  another company nor be exchanged, cashed out or substituted for, in connection with any corporate  transaction affecting the Shares; and               (h) the following provisions apply only if Participant is providing services outside the  United States:                   (i)     the Restricted Stock Units and the Shares subject to the Restricted Stock                          Units are not part of normal or expected compensation or salary for any                          purpose;                  (ii)     Participant  acknowledges  and  agrees  that  none  of the  Company,  the                          Employer or any Parent  or Subsidiary shall be liable for any foreign  

 

                        exchange rate fluctuation between Participant’s local currency and the                          United States Dollar that may affect the value of the Restricted Stock                          Units or of any amounts due to Participant pursuant to the settlement of                          the Restricted Stock Units or the subsequent sale of any Shares acquired                          upon settlement; and                  (iii)    no claim or entitlement to compensation or damages shall arise from                          forfeiture of the Restricted Stock Units resulting from the termination                          of Participant’s status as a Service Provider (for any reason whatsoever                          whether or not later found to be invalid or in breach of employment laws                          in the jurisdiction where Participant is a Service Provider or the terms                          of  Participant’s  employment  or  service  agreement,  if  any),  and  in                          consideration  of  the  grant  of  the  Restricted  Stock  Units  to  which                          Participant  is  otherwise  not  entitled, Participant  irrevocably  agrees                          never  to  institute  any  claim  against  the  Company,  any  Parent  or                          Subsidiary or the Employer, waives his or her ability, if any, to bring                          any such claim, and releases the Company, any Parent or Subsidiary and                          the Employer from any such claim; if, notwithstanding the foregoing,                          any such claim is allowed by a court of competent jurisdiction, then, by                          participating in the Plan, Participant shall be deemed irrevocably to have                          agreed  not  to  pursue  such  claim  and  agrees  to  execute  any  and  all                          documents necessary to request dismissal or withdrawal of such claim.         12. No Advice Regarding Grant.  The Company is not providing any tax, legal or financial  advice, nor is the Company making any recommendations regarding Participant’s participation in the  Plan, or Participant’s acquisition or sale of the underlying Shares.  Participant is hereby advised to  consult with his or her own personal tax, legal and financial advisors regarding his or her participation  in the Plan before taking any action related to the Plan.         13. Data  Privacy.  Participant  hereby  explicitly  and  unambiguously  consents  to  the  collection, use and transfer, in electronic or other form, of Participant’s personal data as described  in this Award Agreement and any other Restricted Stock Unit grant materials by and among, as  applicable, the Employer, the Company and any Parent or Subsidiary for the exclusive purpose of  implementing, administering and managing Participant’s participation in the Plan.                Participant  understands that  the Company and the Employer may hold certain personal  information about Participant, including, but not limited to, Participant’s name, home address and  telephone number, date of birth, social insurance number or other identification number, salary,  nationality, job title, any Shares or directorships held in the Company, details of all Restricted Stock  Units  or  any  other  entitlement  to  Shares  awarded,  canceled,  exercised,  vested,  unvested  or  outstanding  in  Participant’s  favor  (“Data”),  for  the  exclusive  purpose  of  implementing,  administering and managing the Plan.           Participant understands that Data will be transferred to a stock plan service provider as may  be selected by the Company in the future, which is assisting the Company with the implementation,  administration and management of the Plan.  Participant understands that the recipients of the  Data may be located in the United States or elsewhere, and that the recipients’ country of operation  

 

(e.g., the United States) may have different data privacy laws and protections than Participant’s  country.  Participant understands that if he or she resides outside the United States, he or she may  request a list with the names and addresses of any potential recipients of the Data by contacting his  or her local human resources representative.  Participant authorizes the Company, any stock plan  service provider selected by the Company and any other possible recipients which may assist the  Company (presently or in the future) with implementing, administering and managing the Plan to  receive, possess, use, retain and transfer the Data, in electronic or other form, for the sole purpose  of implementing, administering and managing his or her participation in the Plan.  Participant  understands  that  Data  will  be  held  only  as  long  as  is  necessary  to  implement,  administer  and  manage Participant’s participation in the Plan.  Participant understands if he or she resides outside  the United States, he or she may, at any time, view Data, request additional information about the  storage and processing of Data, require any necessary amendments to Data or refuse or withdraw  the  consents  herein, in any  case  without  cost, by  contacting  in writing  his  or  her  local human  resources representative.  Further, Participant understands that he or she is providing the consents  herein on a purely voluntary basis.  If Participant does not consent, or if Participant later seeks to  revoke his or her consent, his or her status as a Service Provider and career with the Employer will  not be adversely affected; the only adverse consequence of refusing or withdrawing Participant’s  consent is that the Company would not be able to grant Participant Restricted Stock Units or other  equity awards or administer or maintain such awards.  Therefore, Participant understands that  refusing or withdrawing his or her consent may affect Participant’s ability to participate in the Plan.   For more information on the consequences of Participant’s refusal to consent or withdrawal of  consent,  Participant  understands  that  he  or  she  may  contact his  or  her  local  human resources  representative.         14. Address for Notices.  Any notice to be given to the Company under the terms of this Award  Agreement will be addressed to the Company at Vital Therapies, Inc., 15222-B Avenue of Science,  San Diego, CA, or at such other address as the Company may hereafter designate in writing.         15. Electronic Delivery and Acceptance.  The Company may, in its sole discretion, decide to  deliver  any  documents  related  to  the Restricted  Stock  Units awarded  under  the  Plan  or  future  Restricted Stock Units that may be awarded under the Plan by electronic means or request Participant’s  consent to participate in the Plan by electronic means.  Participant hereby consents to receive such  documents by electronic delivery and agrees to participate in the Plan through any on-line or electronic  system established and maintained by the Company or another third party designated by the Company.         16. No Waiver.  Either party’s failure to enforce any provision or provisions of this Agreement  shall not in any way be construed as a waiver of any such provision or provisions, nor prevent that  party from thereafter enforcing each and every other provision of this Agreement.  The rights granted  both parties herein are cumulative and shall not constitute a waiver of either party’s right to assert all  other legal remedies available to it under the circumstances.         17. 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 herein set forth, this Agreement shall  be binding upon Participant and his or her heirs, executors, administrators, successors and assigns.   The rights and obligations of Participant under this Agreement may only be assigned with the prior  written consent of the Company.  

 

      18. Additional Conditions to Issuance of Stock.  If at any time the Company will determine, in  its discretion, that the listing, registration, qualification or rule compliance of the Shares upon any  securities exchange or under any state, federal or foreign law, the tax code and related regulations or  under the rulings or regulations of the United States Securities and Exchange Commission or any other  governmental regulatory body or the clearance, consent or approval of the United States Securities  and Exchange Commission or any other governmental regulatory authority is necessary or desirable  as a condition to the issuance of Shares to Participant (or his or her estate) hereunder, such issuance  will not  occur unless and until  such listing, registration, qualification, rule compliance, clearance,  consent  or  approval  will  have  been  completed,  effected  or  obtained  free  of  any  conditions  not  acceptable to the Company.  Subject to the terms of the Agreement and the Plan, the Company shall  not be required to issue any certificate or certificates for Shares hereunder prior to the lapse of such  reasonable  period  of  time  following  the  date  of  vesting  of  the  Restricted  Stock  Units  as  the  Administrator may establish from time to time for reasons of administrative convenience.         19. Language.  If Participant has received this Agreement or any other document related to the  Plan translated into a language other than English  and if the meaning of the translated version is  different than the English version, the English version will control.         20. Interpretation.  The Administrator will have the power to interpret the Plan and this Award  Agreement and to adopt such rules for the administration, interpretation and application of the Plan as  are consistent therewith and to interpret or revoke any such rules (including, but not limited to, the  determination of whether or not any Restricted Stock Units have vested).  All actions taken and all  interpretations and determinations made by the Administrator in good faith will be final and binding  upon Participant, the Company and all other interested persons.  Neither the Administrator nor any  person acting on behalf of the Administrator will be personally liable for any action, determination or  interpretation made in good faith with respect to the Plan or this Award Agreement.         21. Captions.  Captions provided herein are for convenience only and are not to serve as a basis  for interpretation or construction of this Award Agreement.         22. Modifications  to  the  Agreement.   This  Award Agreement  constitutes  the entire  understanding of the parties on the subjects covered.  Participant expressly warrants that he or she is  not accepting this Award Agreement in reliance on any promises, representations, or inducements  other than those contained herein.  Modifications to this Award Agreement or the Plan can be made  only  in  an  express  written  contract  executed  by  a  duly  authorized  officer  of  the  Company.   Notwithstanding anything to the contrary in the Plan or this Award Agreement, the Company reserves  the right to revise this Award Agreement as it deems necessary or advisable, in its sole discretion and  without the consent of Participant, to comply with Section 409A or to otherwise avoid imposition of  any additional tax or income recognition under Section 409A in connection to this Award of Restricted  Stock Units.         23. Governing Law  and  Venue.   This  Award  Agreement  will  be  governed  by  the  laws  of  California, without giving effect to the conflict of law principles thereof.  For purposes of litigating  any dispute that arises under the Restricted Stock Units or this Award Agreement, the parties hereby  submit to and consent to the jurisdiction of the State of California, and agree that such litigation will  be conducted in the courts of San Diego, California or the federal courts for the United States for the  Southern District of California, and no other courts.  

 

      24. Agreement Severable.  In the event that any provision in this Award Agreement will be  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 this Award  Agreement.         25. Amendment, Suspension or Termination of the Plan.  By accepting this Award, Participant  expressly warrants that he or she has received Restricted Stock Units under the Plan, and has received,  read and understood a description of the Plan.  Participant understands that the Plan is discretionary in  nature and may be amended, suspended or terminated by the Company at any time.         26. Entire Agreement. The Plan is incorporated herein by reference. The Plan and this Award  Agreement (including the exhibits referenced herein) constitute the entire agreement of the parties  with respect to the subject matter hereof and supersede in their entirety all prior undertakings and  agreements of the Company and Participant with respect to the subject matter hereof, and may not be  modified adversely to the Participant’s interest except by means of a writing signed by the Company  and Participant.

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