Exhibit 10.4

AGREEMENT

This agreement (this “Agreement”) is made as of May 13th, 2011 by and between
ImmunoCellular Therapeutics, Ltd., a Delaware company (“Company”), and Dr. John
Yu, an individual (“Dr. Yu”).

WHEREAS, Dr. Yu has been serving as the Company’s Chief Scientific Officer under
an Agreement whose term expired on February 28, 2011 (the “Prior Agreement”);
and

WHEREAS, the Company and Dr. Yu desire to enter into an agreement under which
Dr. Yu shall continue to serve as the Company’s Chief Scientific Officer on the
terms set forth in this Agreement, with the term of this Agreement to commence
on the Effective Date.

NOW, THEREFORE, upon the above premises, and in consideration of the mutual
covenants and agreements hereinafter contained, the Company and Dr. Yu hereto
agree as follows.

1. Engagement. The Company shall employ Dr. Yu, and Dr. Yu shall serve, as the
Company’s Chief Scientific Officer. The Company acknowledges that Dr. Yu is a
full-time employee of Cedars-Sinai Medical Center (“CSMC”) and that Dr. Yu has
pre-existing obligations to CSMC and will continue to be subject to the policies
and procedures of CSMC. Pursuant to the Full Time Faculty Consulting Guidelines
of CSMC, Dr. Yu has received the consent of CSMC to participate in the
activities of the Company. A copy of the Consent Memorandum has been provided to
the Company. Company and Dr. Yu agree that each will comply with the Consent
Memorandum and, in the event of a conflict between this Agreement and the
Consent Memorandum, the terms and conditions of the Consent Memorandum shall
control.

2. Services. Dr. Yu agrees to provide to the Company services in the capacity of
the Company’s Chief Scientific Officer (the “Services”). Dr. Yu will report
directly and be responsible to the Company’s Board of Directors (the “Board”).
The Services will be those customarily performed by a Chief Scientific Officer
for a company such as the Company; provided, however that Dr. Yu shall provide
the Services on a part-time basis. Dr. Yu will perform the Services primarily at
the Company’s principal executive offices, which shall be in the Los Angeles,
California area. Dr. Yu shall perform all duties assigned to him by the Company
faithfully, diligently and to the best of his ability. Such duties will include,
but are not limited to, directing technology development and evaluation
research, giving public presentations on behalf of the Company, and meeting with
investors and potential alliance partners. Due to the Company’s needs for
Dr. Yu’s services and Dr. Yu’s pre-existing full-time commitment to CSMC, Dr. Yu
will not serve as an employee, consultant, officer or director of any other
company or organization without first notifying the Company and obtaining the
written consent of the Board, which will not be unreasonably withheld.

3. Term. Dr. Yu shall be employed under this Agreement for a term commencing on
March 1, 2011 (the “Commencement Date”), and ending on the termination date as
provided in this Section 3 or as provided in Section 11 hereof. The term of this
Agreement shall automatically renew on the one-year anniversary date of the
Commencement Date of each year

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hereafter for successive one-year terms unless either party delivers written
notice of the termination of this Agreement to the other party not more than
30 days before the expiration of the applicable one-year period.

4. Compensation.

4.1 The Company will pay to Dr. Yu as compensation for his services hereunder an
initial base salary of $70,000 per annum, payable in equal biweekly
installments. The Board shall annually review Dr. Yu’s performance and base
salary to determine whether an increase in the amount thereof is warranted. The
Company shall also promptly pay Dr. Yu a bonus of $15,000 each (a maximum total
of $30,000) upon and provided that the Company achieves each of the following
milestones within one year from the Commencement Date: (i) enrollment of 75
patients in the Phase II trial of ICT-107 and (ii) filing of an IND for either a
new indication for ICT-107 or for another product candidate of the Company.
Dr. Yu acknowledges that he has been paid by the Company all amounts owing under
the Prior Agreement.

4.2 The Company shall grant Dr. Yu on the later of the date of the Board’s
approval of this Agreement or the execution of this Agreement by the parties
under the Company’s 2006 Equity Incentive Plan (the “Plan”), a stock option (the
“Option”) to purchase 50,000 shares of the Company’s common stock (“Common
Stock”) having an exercise price per share equal to the closing market price on
the date of grant and having a term of seven years from the date of grant. The
Option shall vest in three equal annual installments, with the first vesting
date to be February 28, 2012.

The Option will be exercisable within the seven year term of the option during
the period that Dr. Yu provides services to the Company and for: (i) 90 days
after termination by Dr. Yu if such termination is without Good Reason (as
defined in Section 11.3) and (ii) twelve months after termination by either
party for any other reason except termination for cause by the Company, provided
that such exercise is effected within the seven-year term of the Option. In the
event of a Corporate Transaction (as such term is defined in the Plan), vesting
of the Option (and any other options granted to Dr. Yu) shall be governed by the
provisions contained in the Company’s standard stock option agreement under the
Plan for the Company’s officers and directors, except that any then outstanding
but unvested portion of the Option will fully vest if the Company is not the
surviving entity in the Corporate Transaction unless the surviving entity offers
Dr. Yu an executive position at a compensation level at least equal to Dr. Yu’s
then compensation level under this Agreement. The Option will have such other
terms and conditions as are included in the Company’s standard stock option
agreement under the Plan. If the term of this Agreement continues beyond
February 28, 2012, the Board shall review the aggregate number of stock options
granted to Dr. Yu promptly following such date (and thereafter not less
frequently than annually) in order to determine whether an increase in the
number thereof is warranted.

5. Expenses. The Company shall reimburse Dr. Yu for necessary and reasonable
out-of-pocket business expenses incurred by Dr. Yu in the performance of this
Agreement in accordance with the reimbursement policies of the Company in effect
from time to time.

 

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6. No Benefits. Dr. Yu acknowledges and agrees that he will not be eligible for
any Company employee benefits and, to the extent he otherwise would be eligible
for any Company employee benefits but for the express terms of this Agreement,
Dr. Yu hereby expressly declines to participate in such Company employee
benefits.

7. Withholding; Indemnification. Dr. Yu shall have full responsibility for
applicable withholding taxes for all compensation paid to him under this
Agreement. Dr. Yu agrees to indemnify, defend and hold the Company harmless from
any liability for, or assessment of, any claims or penalties with respect to
such withholding taxes, labor or employment requirements, including any
liability for, or assessment of, withholding taxes imposed on the Company by the
relevant taxing authorities with respect to any compensation paid to Dr. Yu.

8. Proprietary Rights. All inventions, improvements, discoveries, copyrightable
or patentable works, intellectual property, whether or not patentable or
copyrightable, and all other work performed and all materials developed or
prepared by Dr. Yu, in connection with the Services provided to the Company in
connection with the Company’s technology, whether developed or prepared solely
or jointly by Dr. Yu with others, are the property of the Company and, as
between Dr. Yu and the Company, all rights, title and interest therein shall
vest in the Company and shall be deemed to be works made for hire and made in
the course of the services described above. To the extent that title to any such
works may not, by operation of law, vest in the Company or such works may not be
considered works made for hire, all rights, title and interest therein are
hereby irrevocably assigned to the Company. All such materials shall belong
exclusively to the Company, and the Company shall have the right to obtain and
to hold in its own name, copyrights, trademarks, patents, other registrations,
or such other protection as may be appropriate to the subject matter, and any
extensions and renewals thereof. Dr. Yu agrees to give the Company and any
person designated by the Company such reasonable assistance, at the Company’s
expense, as is required to perfect the rights defined in this Section. Dr. Yu
agrees to return to the Company all materials developed or prepared for the
Company by Dr. Yu upon the termination of this Agreement, along with all
materials and other property of the Company in Dr. Yu’s possession at the time
of termination of this Agreement.

9. Confidential Information.

9.1 Confidentiality Obligations. “Confidential Information” means, collectively:
(a) business or technical information of the Company, including but not limited
to information relating to the Company’s product plans, designs, costs, product
prices and names, finances, marketing plans, business opportunities, personnel,
research, development or know-how; (b) any information designated by the Company
as “confidential” or “proprietary” or which, under the circumstances taken as a
whole, would reasonably be deemed to be confidential; and (c) the terms and
conditions of this Agreement. Dr. Yu hereby agrees that, except with respect to
any required disclosure to CSMC (which he shall disclose in writing to the
Company, including a description of the Confidential Information required to be
disclosed, before making such disclosure to CSMC, unless such disclosure relates
to a patient safety issue (in which case he shall promptly advise the Company in
writing after making such safety issue disclosure to CSMC)), he (x) will not
disclose to any third party or use any Confidential Information disclosed to him
by the Company except as expressly permitted in this Agreement; (y) will not
disclose to the Company any Confidential Information of any third party
disclosed to him by such third party without the prior written consent of such
third party; and (z) will take all reasonable measures to maintain the
confidentiality of all Confidential Information of the Company in his possession
or control.

 

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9.2 Exclusions. “Confidential Information” will not include information that is:
(i) already lawfully known by the receiving party prior to this Agreement
without restriction, (ii) in the public domain due to no fault of the receiving
party, (iii) rightfully obtained by the receiving party without similar
restriction from such party, (iv) independently developed by the receiving party
without reference to the other party’s confidential information, or (v) provided
by the disclosing party to another party without similar restriction.

10. Indemnity. Dr. Yu agrees to indemnify and hold the Company harmless from and
against any and all claims, demands, causes of action, losses, damages,
liabilities, costs, and expenses, including attorneys’ fees, arising from a
breach of any of his representations and warranties herein or attributable to or
resulting from his gross negligence or willful misconduct in rendering the
Services. The Company agrees to indemnify and hold Dr. Yu harmless from and
against any and all claims, demands, causes of action, losses, damages,
liability, costs and expenses, including attorneys fees arising out of his
services hereunder, other than those arising from Dr. Yu’s breach of any of his
representations and warranties hereunder or Dr. Yu’s gross negligence or willful
misconduct.

11. Termination.

11.1 In addition to all other rights and remedies which the parties may have
under applicable law, the Company may terminate this Agreement and the services
of Dr. Yu, effective upon the occurrence of any of the following events, any of
which shall constitute a termination for “cause” under this Agreement: (i) a
failure by Dr. Yu to perform any of his material obligations under this
Agreement or to execute and perform in a timely and cooperative manner any
directions of the Board; (ii) the death of Dr. Yu or his disability resulting in
his inability to perform his reasonable duties assigned hereunder for a period
of three consecutive months; (iii) Dr. Yu’s theft, dishonesty, or falsification
of any Company documents or records; (iv) Dr. Yu’s improper use or disclosure of
the Company’s confidential or proprietary information; or (v) Dr. Yu’s
conviction (including any plea of guilty or nolo contendere) of any criminal act
which impairs Dr. Yu’s ability to perform his duties hereunder or which in the
Board’s judgment may materially damage the business or reputation of the
Company; provided, however, that prior to termination for cause arising under
clause (i), Dr. Yu shall have a period of ten days after written notice from
Company to cure the event or grounds constituting such cause. Any notice of
termination provided by Company to Dr. Yu under this Section 11 shall identify
the events or conduct constituting the grounds for termination with sufficient
specificity so as to enable Dr. Yu to take steps to cure the same if such
default is a failure by Dr. Yu to perform any of his material obligations under
this Agreement. In the event Company terminates Dr. Yu for cause, (i) Dr. Yu
shall be entitled as of the termination date to no further base salary other
than such portion of Dr. Yu’s base salary as shall have accrued but remain
unpaid as of the termination date, which shall be due immediately upon
termination, (ii) Dr. Yu shall be entitled to receive payment of any expense
reimbursement amounts owed by the Company to the Dr. Yu through the date of
termination and (iii) any then unexercised but outstanding stock options granted
to Dr. Yu shall be cancelled. The Company shall have no further obligations to
Dr. Yu under this Agreement.

 

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11.2 At any time after twelve months from the Commencement Date, the Company may
terminate Dr. Yu without cause upon 60 days written notice delivered to Dr. Yu.
In the event the Company terminates Dr. Yu’s employment without cause, all of
the following will apply: (i) immediately upon termination, the Company will pay
to Dr. Yu any base salary as shall have accrued but remain unpaid as of the
termination date, any earned but unpaid bonus and any expense reimbursement
amounts owed by the Company to the Dr. Yu through the date of termination; and
(ii) any stock options granted to Dr. Yu, to the extent vested, will be retained
by the Dr. Yu and will be exercisable as set forth in Section 4.2 hereof, the
Plan and related stock option agreement (which shall reflect the terms set forth
in Section 4.2 hereof).

11.3 Dr. Yu may terminate Dr. Yu’s employment at will (without “Good Reason” as
defined below) by giving 60 days’ prior written notice to Company. Dr. Yu shall
be entitled to (i) all base salary up to and through the 60-day period after
Dr. Yu’s notice of termination is given to Company, any earned but unpaid bonus
and any expense reimbursement amounts owed by the Company to the Dr. Yu through
the date of termination and (ii) any stock options, to the extent vested, may be
retained by Dr. Yu and will be exercisable as set forth in Section 4.2 hereof,
the Plan and applicable stock option agreement (which shall reflect the terms
set forth in Section 4.2 hereof). Dr. Yu has the right to terminate Dr. Yu’s
employment for “Good Reason” due to, and not less than 30 days following, the
occurrence of any of the following: (i) a material adverse change in Dr. Yu’s
duties and responsibilities as set forth in this Agreement; (ii) any failure by
Company to pay, or any material reduction by Company of, the base salary or any
failure by Company to pay any other compensation to which Dr. Yu is entitled
pursuant to Section 4 hereof; or (iii) Company creates a work environment
designed to constructively terminate Dr. Yu or to unlawfully harass or retaliate
against Dr. Yu. In the event that Dr. Yu terminates his employment for Good
Reason, all of the following will apply: (A) within five days after the
termination date, Company will pay to Dr. Yu any base salary as shall have
accrued but remain unpaid as of the termination date, any earned but unpaid
bonus and any expense reimbursement amounts owed by the Company to the Dr. Yu
through the date of termination; and (B) any stock options granted to Dr. Yu, to
the extent vested, will be retained by the Dr. Yu and will be exercisable as set
forth in Section 4.2 hereof, the Plan and related stock option agreement (which
shall reflect the terms set forth in Section 4.2 hereof).

12. Non-Competition.

12.1 In consideration of the Company’s entering into this Agreement: Dr. Yu
agrees that during the term of this Agreement and for a period of six months
following the termination of this Agreement for any reason, he will not directly
or indirectly own, manage, operate, join, control, participate in, perform any
services for, invest in, or otherwise be connected with, in any manner, whether
as an officer, director, employee, consultant, partner, investor or otherwise,
any business entity which is engaged in any business in which the Company is
currently engaged or is engaged during the term of this Agreement (with the
prohibited field of business activities to be limited after the termination date
of this Agreement to the research, development, manufacturing or marketing of
dendritic cell or other cancer vaccines or monoclonal antibodies for the
diagnosis or treatment of cancer) without the written approval from the Board.
Nothing herein contained shall be deemed to prohibit (i) Dr. Yu from maintaining
any investments in, and the holding of any securities of, any company to the
extent such investments were made or such securities held by Dr. Yu prior to the
Commencement Date or (ii) investing his funds in securities of a company if the
securities of such company are listed

 

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for trading on a national securities exchange or traded in the over the counter
market and Dr. Yu’s holdings therein represent less than 5% of the total number
of shares or principal amount of other securities of such company outstanding.

12.2 Dr. Yu agrees that he will not, during the term hereof or prior to the
expiration of one year following the termination of his employment for any
reason, without the written consent of the Company, directly or indirectly, by
action alone or in concert with others, solicit for employment or engagement, or
advise or recommend to any other person or entity that such person or entity
solicit for employment or engagement, any person or entity employed or engaged
by the Company.

13. General Terms.

13.1 Assignment. This Agreement is personal to Dr. Yu. He may not sell,
transfer, sublicense, subcontract, hypothecate or assign his rights and duties
under this Agreement without the prior written consent of the Company. The
Company may freely assign its rights and obligations under this Agreement.

13.2 Notices. Any notices or communications under this Agreement shall be in
writing and shall be hand-delivered or sent by certified mail (return receipt
requested), or telecopied, or overnight couriered to the party receiving such
communication at the address specified below:

 

If to the Company:   

Dr. Manish Singh, President

ImmunoCellular Therapeutics, Ltd.

21900 Burbank Boulevard, 3rd Floor

Burbank, California 91367

If to Dr. Yu:   

Dr. John Yu

Suite 800E

8631 West Third Street

Los Angeles, CA 90048

or such other address or addressee as either party may in the future specify to
the other party.

13.3 California Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of California, excluding its conflicts of
laws provisions.

13.4 Dispute Resolution. Any dispute arising out of or relating to this
Agreement shall be decided by binding arbitration by JAMS and shall be held in
Los Angeles, California. The ruling of the arbitrator shall be final and may be
enforced by any party to such arbitration in any court of competent jurisdiction
located in Los Angeles, California.

13.5 Amendment. No modification, amendment, supplement to or waiver of the
provisions of this Agreement shall be binding upon the parties hereto unless
made in writing and duly signed by both parties.

13.6 Waiver. A failure of either party to exercise any right provided for herein
shall not be deemed to be a waiver of any right hereunder.

 

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13.7 Entire Agreement. This Agreement sets forth the entire understanding of the
parties as to the subject matter therein and may not be modified except in
writing executed by both parties.

13.8 Severability. In the event any one or more of the provisions of this
Agreement is invalid or otherwise unenforceable, the enforceability of the
remaining provisions shall be unimpaired.

13.9 Survival. The following Sections shall survive the termination of this
Agreement: 7 (Withholding; Indemnity), 8 (Proprietary Rights), 9
(Confidentiality), 10 (Indemnity) and 12 (Non-Competition).

13.10 Attorneys Fees. If an arbitration or other legal proceeding is brought to
enforce or interpret the provisions of this Agreement or as to the rights or
obligations of any party to this Agreement, the prevailing party in such action
shall be entitled to recover its reasonable attorneys’ fees and costs.

13.11 Disclosure. The terms of this Agreement may be publicly disclosed by the
Company to the extent the Company’s counsel determines that such disclosure is
required by law. The Company shall provide Dr. Yu with a copy of any such
disclosure for his review at least three days prior to making such disclosure.

13.12 Remedies. Dr. Yu acknowledges and agrees that the business of the Company
is highly competitive and that the provisions of Sections 8, 9 and 12 are
reasonable and necessary for the protection of the Company and that any
violation of such covenants would cause immediate, immeasurable and irreparable
harm, loss and damage to the Company not adequately compensable by a monetary
award. Accordingly, Dr. Yu agrees, without limiting any of the other remedies
available to the Company, that any violation of said covenants, or any one of
them, may be enjoined or restrained by any court of competent jurisdiction, and
that any temporary restraining order or emergency, preliminary or final
injunctions may be issued by any court of competent jurisdiction, without notice
and without bond.

IN WITNESS WHEREOF, the parties hereto, each acting under due and proper
authority, have executed this Agreement as of the date set forth above.

 

        IMMUNOCELLULAR THERAPEUTICS, LTD.

/s/ John Yu

    By:  

/s/ Manish Singh

Dr. John Yu       Name:   Dr. Manish Singh       Title:  

President and Chief Executive

Officer

Date:  

5/13/2011

    Date:  

5/13/11

 

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