CV Sciences Inc (CVSI)

[chilling]

During the first quarter of 2019, we entered into a Settlement Agreement (the “Settlement Agreement”) with our founder, former President and Chief Executive Officer
("Mona Jr."), pursuant to which we agreed that Mona Jr.’s resignation on January 22, 2019 was for Good Reason (as defined in Mona Jr.’s Employment Agreement) and we
agreed to extend the deadline for Mona Jr.’s exercise of his stock options for a period of five years. In exchange, Mona Jr. agreed that notwithstanding the terms of his
Employment Agreement providing for acceleration of vesting of all stock options and Restricted Stock Units (RSU's) upon a Good Reason resignation, certain of his unvested
stock options would not immediately vest, but rather continue to vest if, and only if, certain of our milestones are achieved related to our drug development efforts. These
stock options were issued in July 2016 (6,000,000 options) and March 2017 (5,000,000 options). We also agreed to mutually release all claims arising out of and related to
Mona Jr.’s resignation and separation from us. As a result of the Settlement Agreement, we recorded stock-based compensation expense related to the accelerated vesting of
the RSU's and the modification of certain stock options of $5.1 million and $2.7 million in the first quarter of 2019, respectively.
In addition, on December 31, 2019, our former Chief Operating Officer and co-founder resigned. We recorded stock-based compensation expense related to the accelerated
vesting of his unvested outstanding options of $1.7 million.