Document:

EX-10.4

 Exhibit 10.4 

CONSULTING AGREEMENT 

THIS CONSULTING AGREEMENT (this “Consulting Agreement”) is made and entered as of the 31st day of August, 2020 (the “Execution Date”), by and between Galectin Therapeutics Inc., a corporation incorporated under the laws of the State of Nevada (the “Company”), and
Harold H. Shlevin, Ph.D. (“Shlevin”), an individual residing in the State of Florida. 
 WHEREAS, Shlevin has been employed by the
Company pursuant to an Amended and Restated Employment Agreement dated December 11, 2014 (the “Amended and Restated Employment Agreement”) pursuant to which he served in a variety of roles. 

WHEREAS, Shlevin has advised the Company of his wish to retire from full time work on behalf of the Company; and 

WHEREAS, the Company has identified a successor Chief Executive Officer whose employment agreement is being executed contemporaneously
herewith and whose employment will commence not later than the Effective Date (as hereinafter defined). 
 WHEREAS, notwithstanding that his
role as an employee and officer of the Company is ending, Shlevin is willing and desirous of assisting the Company in further advancing the drug development program for the Company’s drug candidate GR-MD-02 (belapectin) and to otherwise provide the Services (as hereinafter defined), when called upon to do so by his successor as CEO, with the Services to be performed as an independent contractor and not
as an executive or corporate officer of the Company; 
 WHEREAS, the Company desires to engage Shlevin as an independent contractor to
perform the Services as hereinafter defined in this Consulting Agreement; 
 WHEREAS, Shlevin desires to provide the Services to the
Company; 
 WHEREAS, Shlevin will continue to serve as a member of the Company’s board of directors; and 

WHEREAS, Shlevin employment with the Company pursuant to the Employment Agreement is being terminated by the Retirement Agreement of even date
herewith (“Retirement Agreement”). 
 NOW, THEREFORE, for and in consideration of the covenants and agreements hereinafter set
forth, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows: 

1.    Effective Date. This Consulting Agreement shall be effective as of September 2, 2020 (the
“Effective Date). 

 2.    Employment Agreement. The termination of Shlevin’s
employment will be governed by terms of the Retirement Agreement. This Consulting Agreement does not amend or modify the rights and obligations of the Company or Shlevin under the Employment Agreement, which rights and obligations are addressed
under the Retirement Agreement. 
 3.    Services. Beginning on the Effective Date, the Company engages Shlevin
to provide continuity and smooth transition for all current activities and to help support the successor CEO and the Galectin team, with the specific duties being as requested by the Company from time to time and accepted by Shlevin (the
“Services”). The Services may, with Consultant’s agreement, include, amongst other activities, public presentations, investor presentations, alone or with Company employees, to publicly demonstrate commitment to the Company, and
continuing to serve as a manager of Galectin Sciences, LLC. Services do not include services rendered by Shlevin in his capacity as a member of the board of directors of the Company, for which he is separately compensated. Notwithstanding the
foregoing, Shlevin will be excused from any travel requirements during the COID-19 pandemic as he is in an at-risk group. 

4.    Independent Contractor. In providing the Services, Shlevin understands that he will at all times be acting as
an independent contractor of the Company. As such, Shlevin and the Company agree that: 
 (a)    Shlevin will not be an
employee of the Company and will not by reason of this Agreement or by reason of providing the Services to the Company be entitled to participate in or to receive any benefit or right under any of the Company’s employee benefit or welfare
plans. 
 (b)    Because Shlevin is not an employee of the Company, the Company will not withhold income taxes from
Shlevin’s compensation, or pay or withhold any Social Security taxes, Medicare taxes, or other payroll taxes. Shlevin will be solely responsible for payment of all taxes (including income taxes and self-employment taxes) that may be due to any
federal, state, or local taxing authority as the result of the compensation paid to Shlevin under this Agreement. 

(c)    Shlevin and the Company shall agree upon the specifications for the Services. The Company shall not exercise
control or direction as to the means and methods for accomplishing the results of the Services. 
 (d)    Shlevin shall
report regularly to the CEO of the Company. The CEO of the Company shall establish the priorities among the Services to be performed and the timing for performance of the Services and may excuse the Shlevin from performing certain of the Services.
If requested by the Company, Shlevin shall provide additional detail regarding the activities and time incurred. 

(e)    Shlevin shall cooperate in the Company’s periodic review of the progress of the Services and other issues
relating to the Company’s ongoing relationship with Shlevin. 

  
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 5.    Standards. While performing the Services under the terms of
this Consulting Agreement, Shlevin shall not knowingly fail to comply with all federal, state, and local laws, statutes, ordinances, rules, regulations, codes, orders and/or programs applicable to Shlevin with regard to the provision of the
Services. 
 6.    Compensation.  

(a)    For the Services, the Company shall pay to Shlevin a fee of $432 per hour, but not less than $8640 per month during
the Term. In addition, throughout the Term, the Company will reimburse Shlevin for 93% of the cost for him and his spouse of (a) medical, hospitalization and drug insurance, (if provided through Medicare, then Medicare Part A, B and D with a
Medicare Supplemental Policy) and (b) dental and vision insurance (the payments under this section, the “Consulting Fees”). 

(b)    Within thirty (30) days of the date of this Agreement, the Company will reimburse Shlevin for all personal
attorney’s fees incurred in connection with this Agreement and the related Retirement Agreement, not to exceed a maximum of $10,000. 

(c)    Shlevin shall monthly submit invoices to the Company reporting the hours worked in the performance of Services in
the preceding month. Such invoice shall provide a level of detail as reasonably requested by the Company. 
 (d)    The
Company shall pay each invoice within 15 days of receipt by wire transfer. 
 (e)    Shlevin shall be reimbursed, in
accordance with the Company’s standard reimbursement policy, for Shlevin’s reasonable out-of-pocket travel expenses incurred in providing the Services and
shall also be reimbursed for reasonable and necessary out of pocket business expenses (e.g., office supplies, high speed internet access, mobile phones, e-mail access and computer supplies); provided, however,
that Shlevin shall submit reasonable documentation supporting such expenses. All reimbursement due Shlevin shall be paid within fifteen (15) days of delivery to the Company of a Shlevin written request for reimbursement along with supporting
documentation descriptions for all expenses for which reimbursement is sought. 
 (f)    During the Term, Consultant
shall be permitted to retain his Company personal computer, e-mail access and server access (subject to the restrictions contained herein) as needed to provide the Services and shall also be reimbursed for
reasonable and necessary out of pocket business expenses (e.g., office supplies, high speed internet access, mobile phones, e-mail access and computer supplies). 

7.     Term of Agreement. The term of this Consulting Agreement (the “Term”) shall begin on the
Effective Date and shall continue until one year from the Effective Date (the “Termination Date”), or such earlier date as provided in Section 8 herein. Unless the Company and Shlevin reach mutual written agreement on an extension of
the Term, this Consulting Agreement shall automatically expire as of the Termination Date. 

  
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 8.    Early Termination. The Term of this Consulting Agreement
may end prior to the Termination Date under the following circumstances: 
 (a)    Termination for Cause. This
Consulting Agreement may be terminated by the Company for Cause at any time with no prior notice to Shlevin. For purposes of this section, “Cause” shall mean (a) a material breach of this Agreement by Shlevin, which breach
remains uncured 30 days after Shlevin’s receipt of written notice of such breach; (b) fraud, willful misappropriation of funds, embezzlement or material dishonesty by Shlevin with respect to the Company; (c) Shlevin being convicted of
a felony or a crime of moral turpitude; and (d) Shlevin engages in intentional misconduct adversely affecting the business or affairs of the Company in a material manner. In the event of termination of this Consulting Agreement by the Company
pursuant to the terms of this Section 8(a), Shlevin shall be paid a prorated portion of the Consulting Fee for the month in which the effective date of such termination occurs, prorated through the termination date. 

(b)    Termination by Shlevin. This Consulting Agreement may be terminated by the Shlevin with or without Cause at
any time upon 30 days advance written notice to the Company. In the event of termination of this Consulting Agreement by the Shlevin pursuant to the terms of this Section 8(b), Shlevin shall be paid the Consulting Fee for the month in which the
effective date of such termination occurs, and not thereafter. 
 9.    Noncompetition and Conflicting
Employment. 
 (a)    During the Term, Shlevin agrees that he will not engage in any other activities that conflict
with his obligations to the Company, will comply with the Amended and Restated Insider Trading Policy of the Company dated October 4, 2011, as it may hereafter be amended, and will not serve as a consultant or board member of any other company
unless approved by the CEO or board of directors of the Company, which approval will not be unreasonably withheld or delayed. 

(b)    As a material inducement to the Company to engage Shlevin, and in order to protect the Company’s Confidential
Information (as defined below) and good will, Shlevin agrees that during the Restricted Period, Shlevin will not render services directly or indirectly, as an executive, employee, agent, consultant or otherwise, to any Competing Organization in
connection with research on or the acquisition, development, production, distribution, marketing or providing of any Competing Product. 

(c)    For purposes of this Agreement: 

(i)    “Competing Products” means any product or drug of any person or organization other than the
Company in existence or under development which (A) currently is in a clinical development phase 1, phase 2 or phase 3 for NASH (Nonalcoholic Steatohepatitis) or (B) operates or may operate primarily as a
galectin-3 inhibitor in the treatment of disease; 
 (ii)    “Competing
Organization” means any person or organization, engaged in, or about to become engaged in, research on or the acquisition, development, production, distribution, marketing or providing of a Competing Product; and 

  
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 (iii)    “Restricted Period” means the Term of this
Consulting Agreement until 12 months after the termination of Shlevin’s engagement with the Company for any reason. 

(d)    The parties agree that the Company is entitled to protection of its interests in the areas protected by this
Section 9. The parties further agree that the limitations as to time, geographical area, and scope of activity to be restrained do not impose a greater restraint upon Shlevin than is necessary to protect the goodwill or other business interest
of the Company. The parties further agree that in the event of a violation of this Section 9, that the Company shall be entitled to terminate this Consulting Agreement for Cause and seek and obtain the recovery of damages and injunctive relief
from and against Shlevin for the breach or violation or continued breach or violation of this Consulting Agreement. Shlevin agrees that if a court of competent jurisdiction determines that the length of time or any other restriction, or portion
thereof, set forth in this Section 9 is overly restrictive and unenforceable, the court may reduce or modify such restrictions to those which it deems reasonable and enforceable under the circumstances, and as so reduced or modified, the
parties hereto agree that the restrictions of this Section 9 shall remain in full force and effect. Shlevin further agrees that if a court of competent jurisdiction determines that any provision of this Section 9 is invalid or against
public policy, the remaining provisions of this Consulting Agreement shall not be affected thereby, and shall remain in full force and effect. 

10.    Non-Solicitation. Shlevin agrees he shall not, during the Restricted
Period, (a) either directly or indirectly solicit or take away, or attempt to solicit or take away employees of the Company, either for his own business or for any other person or entity and/or (b) either directly or indirectly recruit,
solicit or otherwise induce or influence any lessor, supplier, customer, agent, representative or any other person that has a business relationship with the Company to discontinue, reduce or modify such employment, agency or business relationship
with the Company. 
 11.    Intellectual Property. 

(a)     “Work Product”, Defined. Shlevin hereby acknowledges that during the Term of this Consulting
Agreement, in the event Shlevin may make, conceive, discover, reduce to practice, create, author or develop, either alone or jointly with the Company, certain works, Inventions (as defined below), ideas, discoveries, trade secrets, know-how or improvements (whether or not patentable, copyrightable or subject to other legal protection) that constitute, result from or are related to the Services performed by Shlevin hereunder, whether
preliminary or final, and on whatever media rendered, including, but not limited to, any of the foregoing that relates to the Company’s business or to the actual or demonstrably anticipated research or development of the Company’s business
or is made with or using the Company’s equipment, supplies, facilities or Confidential Information or trade secrets (collectively, “Work Product”). All Work Product is Proprietary Information (as defined below). The Company
shall have the unlimited right to make, have made, use, reconstruct, repair, modify, reproduce, publish, distribute and sell the Work Product, in whole or in part, or combine the Work Product with other matter, or not use the Work Product at all, in
its sole discretion. “Work Product” shall exclude Shlevin’s other works, Inventions (as defined below), ideas, discoveries, trade secrets, know-how or improvements (whether or not patentable,
copyrightable or subject to other legal 

  
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protection), whether preliminary or final, and on whatever media rendered to the extent they do not constitute, result from or are related to Competing Products or the Services to be performed
hereunder. 
 (b)    “Company Property”, Defined. The Company shall retain title to all materials and
documentation furnished by the Company to Shlevin (“Company Property”). Shlevin shall deliver to the Company any and all the Company Property and Work Product, including all copies thereof on whatever media rendered, upon the
Company’s request and at the Company’s expense. 
 (c)    Disclosure of Work Product; Assignment.
Shlevin hereby agrees: (i) to disclose all Work Product in writing to the Company and (ii) that all Work Product, including without limitation any copyrights and other intellectual property rights on any Work Product, are and shall be the
sole and exclusive property of the Company, whether as “works for hire” or otherwise. Shlevin hereby unconditionally and irrevocably assigns and transfers to the Company all of Shlevin’s right, title and interest in and to any and all
Work Product including the ownership of any copyrights, patent rights or other rights in such Work Product (whether published or unpublished) including the right to sue for past infringement and to register in its own name, any and all rights in and
to the Work Product. Shlevin agrees not to disclose any Work Product to any third party without the Company’s prior written consent. Shlevin agrees, at the Company’s expense: (i) to execute specific assignments in favor of the Company
with respect to any Work Product and (ii) to execute such documents and perform such lawful actions as the Company deems necessary or advisable in order to enable the Company to procure, maintain, secure and/or enforce any patent, copyright,
trademark, trade secret, or other legal protection (whether in the United States or in any foreign country) relating to any Work Product. The Company may thereafter register in its own name, any and all rights in and to the Work Product, and use,
license, transfer, convey, commercialize or otherwise dispose of such rights as the Company sees fit. Notwithstanding the foregoing, Work Product does not include and shall not include any of the items excluded from the definition of Confidential
Information in
 Section 12(b) below. 
 (d)    Alternative Assignment of Rights; Grant of License. To the
extent that title to any such Work Product may not, by operation of law, vest in the Company or such Work Product may not be considered work for hire, Shlevin hereby grant to the Company an unrestricted, irrevocable, exclusive, worldwide, fully paid
up, perpetual license, with the right to sublicense, in and to any of Shlevin’s proprietary rights required for use in connection with the Work Product. 

(e)    Moral Rights. Shlevin hereby irrevocably and forever waive and agree never to assert any moral rights which
Shlevin may have in any Work Product (including, without limitation, any right of paternity or integrity, any right to claim authorship of such Work Product, any right to object to any distortion, mutilation or modification of such Work Product or
any similar right, whether existing under any United States or any foreign law). 
 (f)    Cooperation in Vesting
Rights. Shlevin shall cooperate (at Company’s expense) fully in: (i) vesting in the Company the ownership of the proprietary rights to the Work 

  
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Product, and (ii) assisting the Company in obtaining patent, copyright, trademark, or any other intellectual property rights in the Work Product and in maintaining and protecting the
Company’s proprietary rights, including, without limitation, executing any documents which the Company reasonably deems necessary for such purpose. The Company agrees to pay Shlevin $432 per hour for any time expended under this subsection.

 (g)    No Third Party Intellectual Property. The Company does not wish to incorporate any unlicensed or
unauthorized materials into its intellectual property or products. Therefore, Shlevin agrees that he will not knowingly disclose to the Company, or cause the Company to use any information or material which is confidential or proprietary to any
third party unless the Company has a written agreement with such third party or the Company otherwise has the right to receive and use same. Shlevin will not incorporate into Shlevin’s work any materials that are subject to the intellectual
property rights of any third party unless the Company has a written agreement with such third party or otherwise has the right to receive and use same. 

12.    Confidentiality. 

(a)    Shlevin recognizes and acknowledges that he will have access to certain information of members of the Company and
that such information is confidential and constitutes valuable, special and unique property of the Company. The parties agree that the Company has a legitimate interest in protecting the Confidential Information (defined below). The parties agree
that the Company is entitled to protection of its interests in the Confidential Information. Shlevin shall not at any time, either during the term of this Consulting Agreement and for five years thereafter, or indefinitely to the extent the
Confidential Information constitutes a trade secret under applicable law, disclose to others, use, copy or permit to be copied, except in pursuance of their duties for and on behalf of the Company, its successors, assigns or nominees, any
Confidential Information without the prior written consent of the Company. The parties further agree that in the event of a violation of this Section 12, that the Company shall be entitled to seek to obtain an injunction against Shlevin for the
breach or violation, continued breach, threatened breach or violation of this Section 12. 

(b)    “Confidential Information” shall mean data and information: (i) relating to the Company’s
business, regardless of whether the data or information constitutes a trade secret as that term is defined in the Georgia Trade Secrets Act or any other applicable trade secrets law; (ii) disclosed to Shlevin or of which Shlevin became aware as
a consequence of Shlevin’s relationship with the Company; (iii) having value to the Company; (iv) not generally known to competitors of the Company; and (v) which includes trade secrets and other information that the Company
treats as confidential; provided, however, that such term shall not mean data or information (A) which has been voluntarily disclosed to the public by the Company, except where such public disclosure has been made by Shlevin without
authorization from the Company; (B) which has been independently developed and disclosed by others; or (C) which has otherwise entered the public domain through lawful means. 

13.    Omitted. 

  
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 14.    Publications. Shlevin will, in advance of publication,
provide the Company with copies of all writings and materials which Shlevin proposes to publish during the Term and for 6 months thereafter. Shlevin also agrees that he will, at the Company’s request and sole discretion, cause to be deleted
from such writings and materials any Confidential Information. 
 15.    General Provisions. 

(a)    Indemnification. To the fullest extent permitted by law and the governing documents of the Company, the
Company shall indemnify and hold harmless Shlevin from and against any and all claims, losses, demands, causes of action, damages, or expenses, including without limitation, reasonable attorney fees, arising out of or resulting from any act,
omission or decision made by Shlevin in good faith while performing Services for the Company. Shlevin shall indemnify and hold harmless the Company from and against any and all claims, losses, demands, causes of action, damages, or expenses,
including without limitation, reasonable attorney fees, arising out of or resulting from any breach by Shlevin of this Consulting Agreement or any act, omission or decision that constitutes gross negligence or willful misconduct by Shlevin in
provision of the Services; provided however, that the maximum aggregate liability of Shlevin under this indemnity as to any claim asserted against him hereunder shall not exceed the aggregate of the fees paid to him for Services under the first
sentence of Section 6(a) hereof in the twelve calendar months preceding the date of the assertion of such claim. The indemnification provided herein shall survive the termination of this Consulting Agreement. 

(b)    Entire Agreement. This Consulting Agreement constitutes the sole understanding of the parties with respect
to the subject matter hereof; provided, however, that this provision is not intended to abrogate any other written agreement between the parties executed with or after this Consulting Agreement. 

(c)    Amendment. No amendment, modification or alteration of the terms or provisions of this Consulting Agreement
shall be binding unless the same shall be in writing and duly executed by the parties hereto. 
 (d)    Counterparts
and Facsimile. This Consulting Agreement may be executed in multiple counterparts, each of which shall for all purposes be deemed to be an original and all of which, when taken together, shall constitute one and the same instrument. This
Consulting Agreement may be executed and delivered by facsimile or by emailing PDF copies. 
 (e)    Modification and
Waiver. Any of the terms or conditions of this Consulting Agreement may be waived in writing at any time by the party which is entitled to the benefits thereof. No waiver of any of the provisions of this Consulting Agreement shall be deemed to
or shall constitute a waiver of any other provision hereof (whether or not similar). 
 (f)    Notices. Any
notices or other communications provided for hereunder may be made by hand, by certified or registered mail, postage prepaid, return receipt requested, or by nationally recognized express courier services provided that the same are addressed to the
party required to be notified. If the notice is to the Company, it shall be addressed to the 

  
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Company’s Chief Executive Officer or Chief Financial Officer at the Company’s headquarters. If the notice is to Shlevin it shall be addressed to Shlevin at his home address as set forth
in the records of the Company. Notice shall be considered accomplished on the date delivered, three days after being mailed or one day after deposit with the express courier, as applicable. Notwithstanding the foregoing, in the event the parties
adopt a course of dealing pursuant to which notices are provided electronically (e.g., using electronic mail), then such electronic notice shall be considered valid hereunder. 

(g)    Governing Law and Dispute Resolution. This Consulting Agreement shall be construed in accordance with, and
governed by, the laws of the State of Georgia. Any disputes arising out of or relating to this Consulting Agreement shall be resolved by means of binding arbitration conducted through the American Arbitration Association (unless an alternative
arbitration forum is agreed upon by the parties at the time of such dispute). The arbitration proceeding shall be conducted by a single arbitrator and shall be held in Atlanta, Georgia. The award of the arbitrator shall be final and shall be
enforceable by any court of competent jurisdiction. The Company agrees to reimburse Executive for all reasonable travel, lodging and meal expenses incurred to attend the arbitration. Notwithstanding the foregoing, the Company shall be permitted to
seek interim injunctive relief in a court of competent jurisdiction in order to enforce the restrictive covenants contained in Sections 9 through 14 of this Consulting Agreement. 

(h)    Severability. In case any one or more of the provisions contained in this Consulting Agreement should be
found by a court of competent jurisdiction to be invalid, illegal or unenforceable in any respect against any party hereto, such invalidity, illegality, or unenforceability shall only apply to such party in the specific jurisdiction where such
judgment shall be made, and the validity, legality, and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby, except that this Agreement shall not be reformed in any way that will deny to
any party hereto the essential benefits of this Consulting Agreement, unless such party waives in writing its rights to such benefits. 

(i)    No Implied Authority. This Consulting Agreement does not result in any party hereto becoming the
agent, employee or representative of the other party for any purpose whatsoever. Neither party hereto is granted any express or implied right or authority by the other party to assume or create any obligation or responsibility on behalf of or in the
name of the other party, or to bind the other party in any manner or thing whatsoever. 
 (j)    Assignment. The
rights and obligations of Shlevin under this Consulting Agreement are not assignable. The Company may assign its rights and obligations under this Consulting Agreement in the event of a sale or license of the assets of the Company to the purchaser
or licensor as the case may be. 
 (Signature Page Follows) 

  
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 IN WITNESS WHEREOF, the parties hereto have signed and delivered this Consulting
Agreement as of the date first above written. 
  

			
	“COMPANY”:
	
	Galectin Therapeutics Inc.
		
	 By:
	 	 /s/ Kevin D. Freeman

	Name:	 	 Kevin D. Freeman

	Title:	 	 Vice Chairman and Authorized Signatory

	
	 /s/ Harold H. Shlevin, Ph.D.

	Harold H. Shlevin, Ph.D.

  
 10Sphere 3D Corporation: Exhibit 4.1 - Filed by newsfilecorp.com

    

    Exhibit 4.1

    SPHERE 3D CORP.

    SECURED PROMISSORY NOTE

    	US$1,102,707.91	August 27, 2020 (the "Issue Date")
	 	Menlo Park, California

     

    FOR VALUE RECEIVED, SPHERE 3D CORP., a corporation incorporated under the laws of the Province of Ontario ("Maker"), unconditionally promises to pay to the order of O'MELVENY & MYERS LLP ("Payee"), in the manner and at the place hereinafter provided, the principal amount of ONE MILLION ONE HUNDRED TWO THOUSAND SEVEN HUNDRED SEVEN U.S. DOLLARS AND NINETY-ONE CENTS (US$1,102,707.91) on December 30, 2020. This Secured Promissory Note (this "Note") shall be deemed to be issued as of January 1, 2020 (the "Effective Date").

    Maker also promises to pay interest on the unpaid principal amount hereof from the Effective Date until paid in full at a rate per annum equal to 1.68%, compounded annually; provided that any principal amount and, to the extent permitted by applicable law, any interest thereon not paid (a) when due at stated maturity pursuant to the first paragraph of this Note above, or as otherwise required by prepayment (other than pursuant to Section 2(b) below), declaration, acceleration, demand or otherwise (both before as well as after judgment) or (b) within 60 days of the date when due pursuant to Section 2(b) below, shall bear interest payable upon demand at a rate that is 5.0% per annum in excess of the rate of interest otherwise payable under this Promissory Note (this "Note").  Interest on this Note shall be payable upon any prepayment of this Note (to the extent accrued on the amount being prepaid) and at maturity.  All computations of interest shall be made by Payee on the basis of a 365-day year, for the actual number of days elapsed in the relevant period (including the first day but excluding the last day).  In no event shall the interest rate payable on this Note exceed the maximum rate of interest permitted to be charged under applicable law.

    1. Payments.  All payments of principal and interest in respect of this Note shall be made in lawful money of the United States of America in same day funds at the office of Payee located at 2765 Sand Hill Road, Menlo Park, California 94025, or at such other place as Payee may direct.  Each payment made hereunder shall be credited first to interest then due and the remainder of such payment shall be credited to principal, and interest shall thereupon cease to accrue upon the principal so credited.

    2. Prepayments.

    (a) This Note may be prepaid at any time.  Each prepayment hereunder shall be accompanied by interest on the principal amount of the Note being prepaid to the date of prepayment.

    (b) All Obligations under this Note shall be become due and payable upon the occurrence of a Change of Control.

    3. Late Fee.  Upon the failure of Maker to pay the principal amount and accrued interest within either (a) 10 days of the date when due under the first paragraph of this Note or upon acceleration or (b) 60 days of the date when due under Section 2(b) above, then a late fee in the amount of US$590,000 shall be immediately due and payable to Payee.

    1

    

    4. Security Grant

    (a) Maker hereby grants, pledges, assigns, transfers, hypothecates and sets over to Payee a valid, continuing first priority security interest in all of Maker's right, title and interest in the Collateral (as described below), in each case whether now or hereafter existing, whether tangible or intangible, whether now owned or hereafter acquired and wherever the same may be located, in order to secure prompt, full, faithful and timely payment and performance of the obligations under this Note, including without limitation all accrued and unpaid interest and fees owing hereunder and any other obligations arising hereunder (including interest and other amounts that, but for the filing of a petition in bankruptcy with respect to Maker, would accrue on such obligations, whether or not a claim is allowed against Maker for such amounts in the related bankruptcy proceeding) (collectively, the "Obligations"), whether at stated maturity, acceleration or otherwise, together with all extensions or renewals thereof, whether voluntary or involuntary, direct or indirect, absolute or contingent, liquidated or unliquidated, whether or not jointly owned with others, and whether or not such Obligations under the Note are from time to time decreased or extinguished and later increased, created or incurred, and all or any portion of such Obligations that are paid, to the extent all or any party of such payment is avoided or recovered directly or indirectly from Payee as a preference, fraudulent transfer or otherwise. "Collateral" shall include all of Maker's property and assets, both real and personal, moveable and immovable, tangible and intangible, of every nature and kind whatsoever, wherever situated, both present and future, now owned or hereinafter acquired, including for greater certainty, any and all intellectual property rights, any proceeds from the sale or other disposition thereof and any share in the capital of a corporation or equity interests in any other Person, including, without limitation all of the following types of personal property, wherever located and whether now owned or hereafter acquired (collectively, the "Collateral"):  all Accounts; all Chattel Paper; all Money and all Deposit Accounts, together with all amounts on deposit from time to time in such Deposit Accounts; all Documents; all General Intangibles (including patents, trademarks, service marks, copyrights, and other intellectual property), Payment Intangibles and Software; all Goods, including Inventory, Equipment and Fixtures; all Instruments; all Investment Property; all Letter-of-Credit Rights and other Supporting Obligations; all Records; all Commercial Tort Claims; and all Proceeds and Accessions with respect to any of the foregoing Collateral. Each category of Collateral set forth above shall have the meaning set forth in Division 9 of the California Uniform Commercial Code in effect on the date hereof (the "UCC").

    (b) Maker agrees that from time to time, at the expense of Maker, Maker will promptly execute and deliver all further instruments and documents, and take all further action, that may be necessary or desirable, or that Payee may request, in order to perfect any security interest granted or purported to be granted hereby or to enable Payee to exercise and enforce its rights and remedies hereunder with respect to any Collateral.  Without limiting the generality of the foregoing, Maker will:  (i) execute (if necessary) and file such financing or continuation statements, or amendments thereto, (ii) execute and deliver, and cause to be executed and delivered, agreements establishing that Payee has control of Deposit Accounts and Investment Property of Maker, and (iii) execute and deliver such further instruments and take such further action as Payee may reasonably request to effect the intent and purposes hereof, to perfect and continue perfected Payee's security interests in the Collateral.  Maker hereby authorizes Payee to file one or more financing or continuation statements, and amendments thereto, relative to all or any part of the Collateral (including any financing statement indicating that it covers "all assets" or "all personal property" of Maker).

    5. Covenants.  For so long as any Obligations remain outstanding under this Note, Maker covenants that any and all indebtedness incurred or assumed by Maker or any of its current or future subsidiaries on or after the date hereof shall be expressly subordinated to the payment of the Obligations and the liens in favor of Payee securing the Obligations.

    
        2

    

    

    6. Representations and Warranties.  Maker hereby represents and warrants to Payee that:

    (a) it is a duly organized and validly existing corporation in good standing under the laws of the jurisdiction of its organization and has the corporate power and authority to own and operate its properties, to transact the business in which it is now engaged and to execute and deliver this Note;

    (b) this Note constitutes the duly authorized, legally valid and binding obligation of Maker, enforceable against Maker in accordance with its terms;

    (c) all consents and grants of approval required to have been granted by any Person in connection with the execution, delivery and performance of this Note have been granted;

    (d) the execution, delivery and performance by Maker of this Note do not and will not (i) violate any law, governmental rule or regulation, court order or agreement to which it is subject or by which its properties are bound or the charter documents or bylaws of Maker or (ii) result in the creation of any lien or other encumbrance with respect to the property of Maker;

    (e) Maker currently has no indebtedness that, if incurred following the date of this Note, would cause a breach of the covenant contained in this Section 5 hereof;

    (f) there is no action, suit, proceeding or governmental investigation pending or, to the knowledge of Maker, threatened against Maker or any of its subsidiaries or any of their respective assets which, if adversely determined, would have a material adverse effect on the business, operations, properties, assets, condition (financial or otherwise) or prospects of Maker and its subsidiaries, taken as a whole, or the ability of Maker to comply with its obligations hereunder; and

    (g) this Note is being delivered in satisfaction of bona fide legal fees that are presently due and payable by Maker to Payee and for which no defense to payment exists.

    7. Events of Default.  The occurrence of any of the following events shall constitute an "Event of Default": 

    (a) failure of Maker to pay any principal, interest or other amount due under this Note (i) within sixty (60) days of when due pursuant to Section 2(b) or (ii) when due, whether at stated maturity, by required prepayment, declaration, acceleration, demand or otherwise (other than pursuant to Section 2(b); or

    (b) failure of Maker to materially perform or observe any other term, covenant or agreement to be performed or observed by it pursuant to this Note and such failure continues uncured for a period of 15 days; or

    (c) any representation or warranty made by Maker to Payee in connection with this Note shall prove to have been false in any material respect when made; or

    (d) any order, judgment or decree shall be entered against Maker decreeing the dissolution or split-up of Maker; or

    
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    (e) suspension of the usual business activities of Maker  or the complete or partial liquidation of Maker's business; or

    (f) Maker commences or institutes proceedings to be adjudicated or declared a bankrupt or insolvent, or if Maker shall make a general assignment for the benefit of its creditors or a proposal under the Bankruptcy and Insolvency Act (Canada), or shall be declared bankrupt or becomes insolvent or consents to the institution of bankruptcy or insolvency proceedings against it under such Act or any other bankruptcy, insolvency or analogous laws, or petitions or applies to any tribunal for the appointment of a receiver, receiver-manager, receiver and manager, custodian, liquidator or trustee, or a person with like powers, or if Maker passes any resolution for its winding-up or liquidation, or commences any proceeding relating to it under any reorganization, arrangement, readjustment of debt, dissolution or liquidation law or statute, or admits in writing its inability to pay its debts generally as they become due or by any act indicates its consent to, approval of, or acquiescence in, any such proceedings for a substantial portion of its property, or if a receiver and manager, liquidator, trustee, custodian or sequestrator or any other person with similar powers shall be appointed (and such appointment is not dismissed or stayed by Maker within 30 days) in respect of Maker or of the property of Maker; or

    (g) an involuntary case shall be commenced against Maker under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect and such event shall have continued for 30 days unless dismissed, bonded or discharged; or

    (h) there is, under any agreement to which Maker is a party with a third party or parties, any default resulting in a right by such third party or parties, whether or not exercised, to accelerate the maturity of any indebtedness (excluding reasonable and customary trade payables incurred in the ordinary course of business); or

    (i) any provision of this Note or any provision hereof or thereof shall cease to be in full force or effect or shall be declared to be null or void or otherwise unenforceable in whole or in part; or Payee shall not have or shall cease to have a valid and perfected first priority security interest in the collateral described in the Security Agreement.

    8. Remedies.  Upon the occurrence of any Event of Default specified in Section 6(f), 6(g) or 6(h) above, the principal amount of this Note together with accrued interest thereon shall become immediately due and payable, without presentment, demand, notice, protest or other requirements of any kind (all of which are hereby expressly waived by Maker).  Upon the occurrence and during the continuance of any other Event of Default Payee may, by written notice to Maker, declare the principal amount of this Note together with accrued interest thereon to be due and payable, and the principal amount of this Note together with such interest shall thereupon immediately become due and payable without presentment, further notice, protest or other requirements of any kind (all of which are hereby expressly waived by Maker).

    In addition to all other rights and remedies provided for herein or otherwise available to it, Payee may exercise in respect of the Collateral, all the rights and remedies of a secured party on default under the UCC (whether or not the UCC applies to the affected Collateral) and the Personal Property Security Act (PPSA), and also may (i) require Maker to, and Maker hereby agrees that it will at its expense and upon request of Payee forthwith, assemble all or part of the Collateral as directed by Payee and make it available to Payee at a place to be designated by Payee that is reasonably convenient to both parties, (ii) subject to the rights of third parties, enter onto the property where any Collateral is located and take possession thereof with or without judicial process, (iii) prior to the disposition of the Collateral, store, process, repair or recondition the Collateral or otherwise prepare the Collateral for disposition in any manner to the extent Payee deems appropriate, (iv) subject to the rights of third parties, take possession of Maker's premises or place custodians in exclusive control thereof, remain on such premises and use the same and any of Maker's equipment for the purpose of completing any work in process, taking any actions described in the preceding clause (iii) and collecting any Obligation, (v) sell the Collateral or any part thereof in one or more parcels at public or private sale, at any of Payee's offices or elsewhere, for cash, on credit or for future delivery, at such time or times and at such price or prices and upon such other terms as Payee may deem commercially reasonable, (vi) exercise dominion and control over and refuse to permit further withdrawals from any Deposit Account maintained with Payee and provide instructions directing the disposition of funds in Deposit Accounts not maintained with Payee, and (vii) provide entitlement orders with respect to security entitlements and other Investment Property constituting a part of the Collateral and, without notice to Maker, transfer to or register in the name of Payee or any of its nominees any or all of the Collateral constituting Investment Property.  Payee may be the purchaser of any or all of the Collateral at any such sale and Payee, shall be entitled, for the purpose of bidding and making settlement or payment of the purchase price for all or any portion of the Collateral sold at any such public sale, to use and apply any of the Obligations as a credit on account of the purchase price for any Collateral payable by Payee at such sale.  Maker hereby waives any claims against Payee arising by reason of the fact that the price at which any Collateral may have been sold at such a private sale was less than the price which might have been obtained at a public sale, even if Payee accepts the first offer received and does not offer such Collateral to more than one offeree.  If the proceeds of any sale or other disposition of the Collateral are insufficient to pay all the Obligations, Maker shall be liable for the deficiency and the reasonable fees of any attorneys employed by Payee to collect such deficiency. 

    
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    Maker hereby irrevocably appoints Payee as Maker's attorney-in-fact, effective upon the occurrence and during the continuance of an Event of Default hereunder, with full authority in the place and stead of Maker and in the name of Maker, Payee or otherwise, from time to time in Payee's discretion, to take any action and to execute any instrument that Payee may deem necessary or advisable to accomplish the purposes of this Note, including, without limitation:

    (i) to obtain and adjust insurance required to be maintained by Maker;

    (ii) to ask for, demand, collect, sue for, recover, compound, receive and give acquittance and receipts for moneys due and to become due under or in respect of any of the Collateral;

    (iii) to receive, endorse and collect any drafts or other Instruments, Documents, Chattel Paper and other documents in connection with clauses (i) and (ii) above;

    (iv) to file any claims or take any action or institute any proceedings that Payee may deem necessary for the collection of any of the Collateral or otherwise to enforce or protect the rights of Payee with respect to any of the Collateral;

    (v) to pay or discharge liens levied or placed upon the Collateral, the legality or validity thereof and the amounts necessary to discharge the same to be determined by Payee in its reasonable discretion, any such payments made by Payee to become obligations of Maker to Payee, due and payable immediately without demand;

    (vi) to sign and endorse any invoices, freight or express bills, bills of lading, storage or warehouse receipts, drafts against debtors, assignments, verifications and notices in connection with Accounts and other documents relating to the Collateral; and

    (vii) sell the Collateral at one or more public or private sales.

    
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    The powers conferred on Payee hereunder are solely to protect its interest in the Collateral and shall not impose any duty upon it to exercise any such powers.  Except for the exercise of reasonable care in the custody of any Collateral in its possession and the accounting for moneys actually received by it hereunder, Payee shall have no duty as to any Collateral or as to the taking of any necessary steps to preserve rights against prior parties or any other rights pertaining to any Collateral.  Payee shall be deemed to have exercised reasonable care in the custody and preservation of Collateral in its possession if such Collateral is accorded treatment substantially equal to that which Payee accords its own property.

    9. Definitions.  The following terms used in this Note shall have the following meanings (and any of such terms may, unless the context otherwise requires, be used in the singular or the plural depending on the reference):

    "Business Day" means any day other than a Saturday, Sunday or legal holiday under the laws of the State of California or any other day on which banking institutions located in such state are authorized or required by law or other governmental action to close.

    "Change of Control" shall mean any of the following events:

    (i)  a merger or consolidation in which (A) Maker is a constituent party or (B) a subsidiary of Maker is a constituent party and Maker issues shares of its capital stock pursuant to such merger or consolidation, except any such merger or consolidation involving Maker or a subsidiary in which the shares of capital stock of Maker outstanding immediately prior to such merger or consolidation continue to represent, or are converted into or exchanged for shares of capital stock that represent, immediately following such merger or consolidation, at least a majority, by voting power (with respect to the power to elect directors or otherwise) or based on percentage of outstanding voting securities, of the capital stock of (1) the surviving or resulting entity or (2) if the surviving or resulting entity is a wholly owned subsidiary of another entity immediately following such merger or consolidation, the parent entity of such surviving or resulting entity;

    (ii) the sale, lease, transfer, exclusive license or other disposition, in a single transaction or series of transactions, by Maker or any subsidiary of Maker of all or substantially all the assets of Maker and its subsidiaries taken as a whole or the sale, lease, transfer, exclusive license or disposition (whether by merger or otherwise) of one or more subsidiaries of Maker if substantially all of the assets of Maker and its subsidiaries taken as a whole are held by such subsidiary or subsidiaries; or

    (iii)  the transfer (whether by merger, consolidation or otherwise), in a single transaction or series of related transactions, to a person or group of affiliated persons, of Maker's securities if, after such closing, such person or group of affiliated persons would hold fifty percent (50%) or more, by voting power (with respect to the power to elect directors or otherwise) or based on percentage of outstanding voting securities, of the capital stock of (A) Maker, (B) the surviving or resulting entity or (C) if the surviving or resulting entity is a wholly owned subsidiary of another entity immediately following such merger or consolidation, the parent entity of such surviving or resulting entity.

    "Person" means any individual, partnership, limited liability company, joint venture, firm, corporation, association, bank, trust or other enterprise, whether or not a legal entity, or any government or political subdivision or any agency, department or instrumentality thereof.

    
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    10. Miscellaneous.  

    (a) All notices and other communications provided for hereunder shall be in writing and mailed, emailed, or delivered as follows: if to Maker or Payee, at its address specified opposite its signature below; or in each case at such other address as shall be designated by Payee or Maker.  All such notices and communications shall, when mailed, emailed or sent by overnight courier, be effective when deposited in the mails, delivered to the overnight courier, as the case may be, or sent by email.

    (b) Maker agrees to indemnify Payee against any losses, claims, damages and liabilities and related expenses, including counsel fees and expenses, incurred by Payee arising out of or in connection with or as a result of the transactions contemplated by this Note.  In particular, Maker promises to pay all costs and expenses, including reasonable attorneys' fees, incurred in connection with the collection and enforcement of this Note. 

    (c) In addition to and not in limitation of any rights of set off that Payee or any other holder of this Note may now or hereafter have under applicable law, Payee or such other holder of this Note, upon the occurrence of any Event of Default, is hereby authorized at any time or from time to time, without notice of any kind to Maker or to any other Person, any such notice being hereby expressly waived, to set off and to appropriate and apply any and all deposits (general or special, time or demand, provisional or final) and any other indebtedness at any time held or owing by Payee or such other holder (including without limitation by branches and agencies of Payee or such other holder wherever located) to or for the credit or the account of Maker against and on account of the obligations and liabilities of Maker to Payee under this Note and all other claims of any nature or description arising out of or connected with this Note, irrespective of whether or not Payee shall have made any demand hereunder and although said obligations, liabilities or claims, or any of them, shall be contingent or unmatured.

    (d) No failure or delay on the part of Payee or any other holder of this Note to exercise any right, power or privilege under this Note and no course of dealing between Maker and Payee shall impair such right, power or privilege or operate as a waiver of any default or an acquiescence therein, nor shall any single or partial exercise of any such right, power or privilege preclude any other or further exercise thereof or the exercise of any other right, power or privilege.  The rights and remedies expressly provided in this Note are cumulative to, and not exclusive of, any rights or remedies that Payee would otherwise have.  No notice to or demand on Maker in any case shall entitle Maker to any other or further notice or demand in similar or other circumstances or constitute a waiver of the right of Payee to any other or further action in any circumstances without notice or demand.

    (e) Maker and any endorser of this Note hereby consent to renewals and extensions of time at or after the maturity hereof, without notice, and hereby waive diligence, presentment, protest, demand and notice of every kind and, to the full extent permitted by law, the right to plead any statute of limitations as a defense to any demand hereunder.

    (f) THIS NOTE AND THE RIGHTS AND OBLIGATIONS OF MAKER AND PAYEE HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF CALIFORNIA, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.  

    (g) ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST MAKER ARISING OUT OF OR RELATING TO THIS NOTE SHALL BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION IN THE STATE OF CALIFORNIA, AND BY EXECUTION AND DELIVERY OF THIS NOTE MAKER ACCEPTS FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION OF THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON CONVENIENS AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH THIS NOTE.  Maker hereby agrees that service of all process in any such proceeding in any such court may be made by registered or certified mail, return receipt requested, to Maker at its address set forth below its signature hereto, such service being hereby acknowledged by Maker to be sufficient for personal jurisdiction in any action against Maker in any such court and to be otherwise effective and binding service in every respect.  Nothing herein shall affect the right to serve process in any other manner permitted by law or shall limit the right of Payee to bring proceedings against Maker in the courts of any other jurisdiction.

    
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    (h) MAKER AND, BY ITS ACCEPTANCE OF THIS NOTE, PAYEE AND ANY SUBSEQUENT HOLDER OF THIS NOTE, HEREBY IRREVOCABLY AGREE TO WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS NOTE OR ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS NOTE AND THE LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS OF THIS NOTE.  In the event of litigation, this provision may be filed as a written consent to a trial by the court.

    (i) Maker hereby waives the benefit of any statute or rule of law or judicial decision, including without limitation California Civil Code § 1654, which would otherwise require that the provisions of this Note be construed or interpreted most strongly against the party responsible for the drafting thereof.

    (j) This Note may be executed in any number of counterparts, each of which shall be deemed to be an original, and all of which together will constitute one and the same instrument. The facsimile or portable document format (i.e., PDF) signatures of any party hereto shall be deemed to be an original signature of such party, valid and effective for all purposes.

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    IN WITNESS WHEREOF, Maker has caused this Note to be executed and delivered by its duly authorized officer as of the day and year and at the place first above written.

    SPHERE 3D CORP.

    By: /s/ Peter Tassiopoulos                          

    Name:  Peter Tassiopoulos

    Title: CEO

    Address:895 Don Mills Road, Bldg 2, Suite 900

    Toronto, Ontario, Canada, M3C 1W3

    ACCEPTED AND AGREED:

    O'MELVENY & MYERS LLP

    By: /s/ Paul Sieben                        

    Name:  Paul Sieben

    Title: Partner

    Address: 2765 Sand Hill Road

    Menlo Park, CA 94025

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