Exhibit 10.1

Exemption from stamp duties according to Sec. 14(2) of the Act on the
Establishment of the Austrian Research Promotion Agency
(Forschungsförderungsgesellschaftsgesetz).

SETTLEMENT AGREEMENT

concluded between

ARSANIS Biosciences GmbH

Arsanis, Inc.

Artemis AC Corp.

X4 Pharmaceuticals, Inc.

and

Österreichische Forschungsförderungsgesellschaft mbH

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1.

PARTIES TO THE AGREEMENT

This Settlement Agreement (“Agreement”) is concluded between the following
Parties (“Parties”):

 

  (a)

ARSANIS Biosciences GmbH, a company incorporated under the laws of Austria,
having its statutory seat in Vienna and its registered office at
Helmut-Qualtinger-Gasse 2, 1030 Vienna, registered with the Austrian commercial
register under number FN 354305 m (“Arsanis AT”);

 

  (b)

Arsanis, Inc. a company formed under the laws of the State of Delaware, having a
principal place of business and its registered office at 950 Winter Street,
Suite 4500, Waltham, MA02451, United States (“Arsanis Inc.”);

 

  (c)

Artemis AC Corp a company formed under the laws of the State of Delaware, having
a principal place of business and its registered office at 950 Winter Street,
Suite 4500, Waltham MA 02451, United States (“Artemis”);

 

  (d)

X4 Pharmaceuticals, Inc. a company formed under the laws of the State of
Delaware, having a principal place of business and its registered office at 955
Massachusetts Ave, Cambridge, MA 02139, United States (“X4”); and

 

  (e)

Österreichische Forschungsförderungsgesellschaft mbH a company incorporated
under the laws of Austria, having its statutory seat in Vienna and its
registered office at Sensengasse 1, 1090 Vienna, registered with the Austrian
commercial register under number FN 252263 a (“FFG”);

 

2.

INTRODUCTION

 

  2.1

Arsanis Inc. is a clinical-stage biopharmaceutical company focused on applying
monoclonal antibody immunotherapies to address serious infectious diseases.

 

  2.2

Arsanis AT is a wholly owned subsidiary of Arsanis Inc. focusing on discovery
research.

 

  2.3

Artemis, a wholly owned subsidiary of Arsanis Inc., and Arsanis Inc. have
entered into a merger agreement with X4, pursuant to which Artemis will merge
with and into X4, as a result of which X4 will become a wholly owned subsidiary
of Arsanis Inc. (the “Merger”). The Merger is expected to close on or about
12 March 2019, subject to the approval of the stockholders of the companies
involved, such shareholder approval is expected to be obtained on or before
11 March 2019.

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  2.4

FFG is the national funding agency for industrial research and development in
Austria, its shares are held by the Republic of Austria.

 

  2.5

Arsanis AT has entered into the following subsidy agreements (the “Subsidy
Agreements”) with FFG and has received loans and grants from FFG under these
agreements:

 

Contract No.

 

Contract Date

 

Funding Period

 

Subsidies provided under the Contract

832915   1 July 2011   13 May 2011 – 30 April 2012   loan and grant 837128  
2 July 2012   1 May 2012 – 30 April 2013   loan and grant 841918   1 July 2013  
1 May 2013 – 31 January 2014   loan and grant 845382   24 March 2014  
1 February 2014 – 31 January 2015   loan and grant 838450   28 November 2012  
1 August 2012 – 31 July 2015   grant 850226   6 July 2015   2 February 2015 –
31 January 2017   loan 858392   13 February 2017   1 November 2016 – 31 October
2018   loan 840293   25 March 2013   1 February 2013 – 31 March 2014   loan and
grant 846178   20 May 2014   1 April 2014 – 30 April 2015   loan and grant
851485   8 July 2015   1 May 2015 – 30 April 2016   loan and grant 856836  
27 June 2016   1 May 2016 – 30 June 2017   loan and grant

 

  2.6

With letters dated 4 February 2019 to Arsanis AT and Arsanis Inc. FFG alleged
that Arsanis AT is in breach of certain conditions of the Subsidy Agreements and
claimed, among other things, immediate repayment of the loans and repayment of
the grants provided under the Subsidy Agreements as well as the payment of
interest applied to each of the loans and grants from the date such amounts were
paid by FFG to Arsanis AT.

 

  2.7

Arsanis AT and Arsanis Inc. hold the position that Arsanis AT is not in breach
of any conditions of the Subsidy Agreements and consequently do not see any
legal basis for FFG’s claims.

 

3.

SETTLEMENT

Subject to the terms and conditions of this Agreement, Arsanis AT and FFG wish
to enter into a full and final settlement with regard to the subject matter
described under Section 2.5 to 2.7 of this Agreement.

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The Parties agree as follows:

 

  3.1

Repayment of Loans

Arsanis AT shall repay the loans granted under the Subsidy Agreements until
30 June 2021 in accordance with the following amended (accelerated) payment
schedule:

 

Contract No.

   Principal
Loan
Amount
in EURO      Original Due
Date      New Due Date      New Repayment Schedule      31 March 2019     
30 June 2020      30 June 2021  

832915

     515.357        30 June 2020        30 June 2020           515.357     

837128

     580.000        30 June 2020        30 June 2020           580.000     

841918

     1.244.928        30 June 2020        30 June 2020           1.244.928     

845382

     1.634.932        30 June 2020        30 June 2020           1.634.932     

850226

     1.500.000        31 March 2022        31 March 2019        1.500.000     
  

858392

     750.000        31 March 2023        31 March 2019        750.000        

840293

     530.693        30 June 2022        30 June 2021              530.693  

846178

     627.712        30 June 2022        30 June 2021              627.712  

851485

     775.262        30 June 2022        30 June 2021              775.262  

856836

     346.320        31 March 2020        31 March 2019        346.320           
           2.596.320        3.975.217        1.933.667                
Total Amount to be repaid EUR 8.505.204  

In case of a default of Arsanis AT with payments under the accelerated payment
schedule FFG shall provide Arsanis AT with a reminder giving Arsanis AT a
minimum 14 (fourteen) day grace period to effect the outstanding payment. A copy
of such letter shall be sent to Arsanis Inc.

 

  3.2

Interest

The regular interest to be paid in connection with the loans shall be paid by
Arsanis AT in accordance with the provisions of and at the interest rates agreed
in the Subsidy Agreements. Such interest shall accrue for each loan until its
respective date of actual repayment. The interest shall be paid by Arsanis AT
upon receipt of an invoice from FFG on a half-yearly basis and any remaining
amount of interest at the date of actual repayment of the respective loan. Such
invoice shall provide for a minimum payment term of two (2) weeks. FFG has the
right to collect interest by auto-debiting a bank account of Arsanis AT for all
interest amounts, consistent with its current practice. FFG will inform Arsanis
AT at the time of sending the respective invoice in case it does not intend to
exercise the latter right.

In case of a default of Arsanis AT with interest payments FFG shall provide
Arsanis AT with a reminder giving Arsanis AT a minimum 14 (fourteen) day grace
period to effect the outstanding interest payments. A copy of such letter shall
be sent to Arsanis Inc.

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  3.3

Cash Balance

Beginning from a date that is no more than fourteen (14) days from the closing
of a financing of Arsanis Inc. following the closing of the Merger between X4
and Artemis, but in any event from 30 April 2019, Arsanis AT shall maintain a
cash balance equal to at least 70 (seventy) per cent of the then current total
principal amount of FFG loans outstanding at any point of time until all
principal amounts of loans are fully repaid. The cash balance shall be
maintained by Arsanis AT in a bank account held with an Austrian bank.

 

  3.4

Austrian Site

Arsanis AT shall maintain an Austrian site with a minimum number of full-time
equivalents of eight (8) employees until at least 31 December 2021. In case of
employees leaving Arsanis AT, either because of an employee’s resignation or
because of dismissal, Arsanis AT is granted a reasonable time period for
replacement of such employees. FFG acknowledges that such reasonable time period
may vary from time to time depending on the position and qualification of the
respective employee(s), but that such time period shall not exceed three
(3) months save in case of a specialist skilled employee’s resignation or
dismissal for cause in which case Arsanis AT shall, promptly following an
unsuccessful lapse of such three (3) months period, submit a report to FFG
setting out which efforts Arsanis AT has undertaken to seek a suitable
replacement employee(s).

 

  3.5

Intellectual Property

The intellectual property (including but not limited to patents, utility
patents, designs, trademarks, trade names, domain names, logos, copyright,
rights under license agreements, recipes, formulas and know-how) (“IP”) which
generated or may be generated (if any) from or in relation to the projects
funded by FFG under the Subsidy Agreements (which, for the sake of clarity, the
parties agree does not include ASN500) shall remain part of the assets of
Arsanis AT at least until 31 December 2021. While Arsanis AT is not under any
obligation to continue to develop such IP, it agrees that in the event that it
licenses or provides rights to such IP to any third party it will receive arm’s
length compensation as consideration for at least the period up to 31 December
2021.

FFG is aware that Arsanis Inc. has entered in an option and license agreement
with subsidiaries of Bravos Biosciences, LLC for the ASN200 and ASN300 programs
and confirms that this licensing (as disclosed to FFG) does not constitute a
violation of the above-mentioned obligation or any other obligation between
Arsanis AT, Arsanis Inc. and FFG, including under the Subsidy Agreements.

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FFG was informed by Arsanis AT by way of final report regarding the ASN400
project (submitted to FFG by Arsanis AT on 1 March 2018) that Arsanis AT has
abandoned the respective project and confirms the abandonment does not
constitute a violation of the above-mentioned obligation or any other
obligation, including under the Subsidy Agreements.

Further, FFG was informed by Arsanis AT that Arsanis AT has discontinued its
Phase 2 clinical trial of ASN100 for the prevention of S. aureus pneumonia in
high-risk, mechanically ventilated patients and confirms that such action does
not constitute a violation of the above-mentioned obligation or any other
obligation, including under the Subsidy Agreements.

 

  3.6

Reporting

Arsanis AT shall provide FFG with a bank account excerpt, balance sheet and
statement of operations (P&L statement) of Arsanis AT (each dated as of the end
of the respective calendar quarter) on a quarterly basis. The bank account
excerpt shall be sent within five (5) days after the end of the respective
calendar quarter, and the other above reports shall be sent to FFG within five
(5) days after Arsanis Inc. files its required quarterly and annual reports on
Forms 10-Q and 10-K, respectively, with the United States Securities and
Exchange Commission.

In case of a failure of Arsanis AT to deliver any of the bank account excerpts
or any of the reports according to the foregoing paragraph, FFG shall provide
Arsanis AT with a reminder giving Arsanis AT a minimum fourteen (14) day grace
period to provide such excerpts or reports. A copy of such letter shall be sent
to Arsanis Inc.

 

  3.7

Commitments of Arsanis Inc.

Arsanis Inc. shall procure the timely transfer of sufficient funds to Arsanis AT
in order to enable Arsanis AT to ensure the minimum cash balance requirement in
accordance with Section 3.3 of this Agreement can be met by Arsanis AT at any
given time.

Arsanis Inc shall use its best efforts to enable Arsanis AT to comply with the
obligations provided for under Section 3.1 to 3.6 of this Agreement and shall
refrain from any instructions and measures that might endanger such compliance.

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  3.8

Commitments of Artemis and X4

Artemis and X4 confirm that they are aware of the obligations and commitments of
Arsanis AT and Arsanis Inc. provided for under Section 3.1 to 3.7 of this
Agreement. Each of them shall use commercially reasonable efforts to enable
Arsanis AT and Arsanis Inc. to comply with their obligations provided for under
Section 3.1 to 3.7 of this Agreement, which will not include actions that cause
a breach or event of default under X4’s existing loan facilities, and shall
refrain from any instructions and measures that might endanger such compliance.

 

  3.9

Event of Default

In the event of a breach (respectively a continuing breach despite the granting
and the lapse of a grace period if and where a grace period is expressly
foreseen under this Agreement) by Arsanis AT and/or Arsanis Inc. of any of the
obligations, commitments and undertakings stipulated in Section 3.1 to 3.5, with
respect to Section 3.6 only as far as it is related to the bank account excerpts
and with regard to the first paragraph of Section 3.7 of this Agreement, FFG
shall be entitled to declare any of the outstanding loan repayments as
stipulated under Section 3.1 or parts thereof due for immediate repayment.

Any further rights FFG might have under any of the Subsidy Agreements remain
unaffected.

 

  3.10

Waiver of claims

Except for the claims for repayment of the loans and regular interest according
to the payment schedule under Section 3.1 and Section 3.2 of this Agreement, FFG
waives all claims against Arsanis AT and Arsanis Inc., including those set forth
in the letters described in Section 2.6, in particular any claims for repayment
of grants and interest exceeding such regular interest, under the suspensive
condition and provided that Arsanis AT and Arsanis Inc. comply with the
obligations and commitments according to Sections 3.1 to 3.7 of this Agreement.
FFG will not pursue such claims as long as an Event of Default according to
Section 3.9 of this Agreement has not occurred.

Subject to the fulfillment of Arsanis AT’s obligations and commitments according
to Sections 3.1 to 3.5 of this Agreement, FFG releases with effect as of
31 December 2021 (i) Arsanis AT from all obligations and claims arising from and
in relation to the Subsidy Agreements, (ii) Arsanis Inc. from all obligations
vis-a-vis FGG and claims of FFG arising from and in relation to Arsanis, Inc.’s
commitments provided under this Agreement and provided for under any other
documents in favor of Arsanis AT in effect as of the date of this Agreement and
(iii) Artemis and X4 from all obligations and claims arising from and in
relation to their commitments provided under this Agreement.

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  3.11

No further payouts under the Subsidy Agreements:

Arsanis AT shall not be entitled to any further payouts of loans and grants
under the existing Subsidy Agreements.

 

4.

GOVERNING LAW AND JURISDICTION

 

  4.1

This Agreement shall be governed by and construed in accordance with the laws of
Austria excluding Austrian conflict of law rules.

 

  4.2

All disputes or claims arising out of or in connection with this Agreement,
including disputes relating to its validity, breach, termination or nullity,
shall be finally settled under the Rules of Arbitration (Vienna Rules) of the
Vienna International Arbitral Centre (VIAC) of the Austrian Federal Economic
Chamber by one or three arbitrators appointed in accordance with the said Rules.
The place of arbitration shall be Zurich, Switzerland. The language of the
arbitration shall be English.

 

5.

STAMP DUTY

 

  5.1

The Parties hold the view that this Agreement falls under the exemption from
stamp duties according to Sec. 14 (2) of the Act on the Establishment of the
Austrian Research Promotion Agency (Forschungsförderungs-gesellschaftsgesetz).

 

  5.2

In case Austrian tax authorities take a different view the stamp duties arising
from this Agreement shall be equally borne by FFG and Arsanis AT in equal parts.

 

6.

EFFECTIVENESS AND EXECUTION/MISCELLANEOUS:

 

  6.1

This Agreement shall become effective upon signature by all Parties.

 

  6.2

It shall be executed in five (5) originals of which each Party shall retain one.
Each Party has the requisite power and authority to execute and perform its
respective obligations under, this Agreement. Each of the undersigned declares
in lieu of oath to have the requisite power and authority to enter into this
Agreement with binding effect upon the respective Party.

 

  6.3

The Parties agree to keep this Agreement, the content of this Agreement and any
information provided for under Section 3.6 of the Agreement confidential and not
to disclose it to third parties. The aforementioned obligation does not apply
(i) with regard to a disclosure to its group companies to the extent reasonably
necessary to perform its obligations under this Agreement, (ii) with regard to
information that is already in a public domain for reasons other than the breach
of this Agreement and (iii) in case and to the extent a Party (x) reasonably
requires disclosure in order to preserve or enforce its rights and

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  claims under or in relation to this Agreement or (y) is obliged to disclose
the existence or the content of this Agreement under applicable laws, a binding
order of a competent court, a competent (regulatory) authority or tribunal or to
the Austrian government or its agencies, including but not limited to the
Austrian Government Accountability Office (Rechnungshof). For clarity, Arsanis
Inc. is obligated to disclose the entry into this Agreement and to file it in a
public filing with the United States Securities and Exchange Commission promptly
upon execution of the Agreement.

 

  6.4

This Agreement shall be binding on each Party’s successors and assigns.

 

  6.5

This Agreement may only be amended or terminated, and any provision hereof may
only be waived, in writing signed by all of the parties hereto.

 

  6.6

This Agreement, along with the Subsidy Agreements as altered hereby, supersedes
any and all prior or contemporaneous oral and/or written agreements between
Arsanis AT, Arsanis Inc., Artemis and X4, on the one hand, and FFG, on the other
hand, and sets forth the entire agreement between Arsanis AT, Arsanis Inc.,
Artemis and X4, on the one hand, and FFG, on the other hand.

[Remainder of page intentionally left blank.]

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SIGNATURE PAGE

 

ARSANIS Biosciences GmbH /s/ Michael P. Gray Name: Michael P. Gray Position:
Managing Director Date: 8 March 2019

 

Arsanis, Inc. /s/ Michael P. Gray Name: Michael P. Gray Position: Chief
Executive and Chief Financial Officer Date: 8 March 2019

 

Artemis AC Corp. /s/ Michael P. Gray Name: Michael P. Gray Position: Director
Date: 8 March 2019

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X4 Pharmaceuticals, Inc /s/ Paula Ragan, Ph.D.

Name: Paula Ragan, Ph.D.

Position: President and Chief Executive Officer

Date: 3/8/2019

 

Österreichische Forschungsförderungsgesellschaft mbH /s/ Dr. Egerth     /s/
Dr. Pseiner

Name: Dr. Egerth

            Dr. Pseiner

    Position: Managing Directors Date: March 8, 2019