Exhibit 10.4

EMPLOYMENT AGREEMENT

This EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into effective
as of July 24, 2020 (the “Effective Date”) by and between F-Star Therapeutics
LLC (the “Company”), and Louis Kayitalire (the “Executive”).

RECITALS

WHEREAS, the Executive is currently employed by the Company pursuant to the
terms of an Offer Letter dated May 24, 2019 (the “Offer Letter”); and

WHEREAS, the Company’s parent, F-Star Therapeutics Ltd., has entered into or
anticipates entering into a Share Exchange Agreement with Spring Bank
Pharmaceuticals, Inc., and certain other parties (the “Exchange Agreement”).

NOW THEREFORE, in consideration of the foregoing premises and the mutual
promises, terms, provisions and conditions set forth in this Agreement, the
parties hereby agree:

1. Employment. The Executive’s employment with the Company pursuant to the terms
of this Agreement will commence on the Effective Date.

2. Term. This Agreement will continue in effect until terminated in accordance
with Section 5. The term of Executive’s employment is hereafter referred to as
the “Term.” The effective date of Executive’s termination of employment with the
Company is hereafter referred to as the “Termination Date.”

3. Duties and Performance.

(a) During the Term, the Executive shall serve the Company as its Chief Medical
Officer. In addition, and without further compensation, the Executive shall
serve as a director and/or officer of the Company and/or one or more of the
Company’s Affiliates to the extent so elected or appointed from time to time.
For purposes of this Agreement, “Affiliate” means any person or entity directly
or indirectly controlling, controlled by or under common control with the
Company, where control may be by either management authority or equity interest.

(b) During the Term, the Executive shall be employed by the Company on a
full-time basis and shall perform the duties and responsibilities of his
position and such other duties and responsibilities on behalf of the Company and
its Affiliates as reasonably may be designated from time to time by the
Company’s Chief Executive Officer (the “CEO”). The Executive’s principal work
location shall be in New York, New York, subject to such business travel as is
customary for Executive’s position.

(c) During the Term, the Executive shall devote his full business time and his
best efforts, business judgment, skill and knowledge exclusively to the
advancement of the business and interests of the Company and its Affiliates and
to the discharge of his duties and responsibilities hereunder. The Executive
shall not engage in any other business activity or serve in any industry, trade,
professional, governmental or academic position during the term of this
Agreement, except as may be expressly approved in advance by the CEO in writing;
provided, however, that the Executive may without advance consent participate in
charitable activities and passive personal investment activities, provided that
such activities do not, individually or in the aggregate: (i) interfere with the
performance of the Executive’s duties under this Agreement; (ii) conflict with
the business interests of the Company or any of its Affiliates; or (iii) violate
Sections 7, 8 and 9 of this Agreement.

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(d) During the Term, the Executive shall comply with all Company policies,
practices, and procedures and all codes of ethics or business conduct applicable
to the Executive’s position, as in effect from time to time.

4. Compensation and Benefits.

(a) Base Salary. During the Term, the Company shall pay the Executive a base
salary at a rate of $450,000 per year (the “Base Salary”), payable in accordance
with the normal payroll practices of the Company as in effect from time to time.
The Company may review and adjust the Base Salary from time to time.

(b) Annual Bonus Compensation. For each full fiscal year completed during the
Term, the Executive shall be eligible to participate in an annual bonus plan
maintained by the Company. The Executive’s annual target bonus opportunity shall
be equal to forty-percent (40%) of the Base Salary (the “Target Bonus”) with the
actual amount of the bonus, if any, to be determined by the Board of Directors
(the “Board”) or the Compensation Committee of the Board, in accordance with
applicable performance criteria reasonably established by the Board or the CEO.
In order to earn an annual bonus under this Section 4(b) for any fiscal year,
the Executive must be employed by the Company on the date of payment.

(c) Employee Benefit Plans. During the Term, the Executive shall be eligible to
participate in such employee benefit plans from time to time in effect for
similarly-situated employees of the Company. Such participation shall be subject
to (i) the terms of the applicable plan documents and (ii) generally applicable
Company policies. The Executive shall have no recourse against the Company in
the event that the Company should alter, modify, add to or eliminate any or all
of its employee benefit plans.

(d) Business Expenses. The Company shall pay or reimburse the Executive for
reasonable, customary, and necessary business expenses incurred or paid by the
Executive in the performance of his duties and responsibilities hereunder,
subject to such reasonable substantiation and documentation and to travel and
other policies as may be required by the Company from time to time.

(e) Clawback Policy. Any amounts paid pursuant to this Agreement shall be
subject to recoupment in accordance with any clawback policy that the Company
has adopted or is required to adopt pursuant to the listing standards of any
national securities exchange or association on which the Company’s securities
are listed or as is otherwise required by the Dodd-Frank Wall Street Reform and
Consumer Protection Act or other applicable law.

5. Termination of Employment; Severance Benefits. The Executive’s employment
shall terminate under the following circumstances:

(a) Death. In the event of the Executive’s death during the Term, the date of
death shall be the Termination Date and the Company shall pay or provide to the
Executive’s designated beneficiary or, if no beneficiary has been designated by
the Executive in a notice received by the Company, to his estate: (i) any Base
Salary earned but not paid through the Termination Date; and (ii) any business
expenses incurred by the Executive but unreimbursed on the Termination Date,
provided that such expenses and required substantiation and documentation are
submitted within sixty (60) days following the Termination Date, that such
expenses are reimbursable under Company policy, and that any such expenses
subject to Section 5(h)(iv) shall be paid not later than the deadline specified
therein (all of the foregoing, payable subject to the timing limitations
described herein, the “Final Compensation”). Other than the Final Compensation,
the Company shall have no further obligation or liability to the Executive.
Other than business expenses described in Section 5(a)(ii), the Final
Compensation shall be paid to the Executive’s designated beneficiary or estate
at the time prescribed by applicable law and in all events within thirty
(30) days following the Termination Date.

 

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(b) Disability.

(i) The Company may terminate the Executive’s employment, upon notice to the
Executive, in the event that the Executive becomes disabled during his
employment hereunder through any illness, injury, accident or condition of
either a physical or psychological nature and, as a result, is unable to perform
substantially all of his duties and responsibilities hereunder (notwithstanding
the provision of any reasonable accommodation) for one hundred and eighty
(180) days during any period of three hundred and sixty-five (365) consecutive
calendar days, whether or not consecutive. In the event of such termination, the
Company shall have no further obligation or liability to the Executive, other
than for payment of the Final Compensation due the Executive. Other than
business expenses described in Section 5(a)(ii), the Final Compensation shall be
paid to the Executive at the time prescribed by applicable law and in all events
within thirty (30) days following the Termination Date.

(ii) The Board may designate another employee to act in the Executive’s place
during any period of the Executive’s disability. Notwithstanding any such
designation, the Executive shall continue to receive the Base Salary in
accordance with Section 4(a) and to participate in employee benefit plans in
accordance with Section 4(c), to the extent permitted by the then-current terms
of the applicable employee benefit plans, until the Executive becomes eligible
for disability income benefits under the Company’s disability income plan, if
any, or until the termination of his employment, whichever shall first occur.
While receiving disability income payments under any Company’s disability income
plan, the Executive shall not be entitled to receive any Base Salary under
Section 4(a), but shall continue to participate in the employee benefit plans in
accordance with Section 4(c) and to the extent permitted by and subject to the
then-current terms of such plans, until the termination of his employment
hereunder.

(iii) If any question shall arise as to whether the Executive is disabled
through any illness, injury, accident or condition of either a physical or
psychological nature so as to be unable to perform substantially all of his
duties and responsibilities hereunder, the Executive may, and at the request of
the Company shall, submit to a medical examination by a physician selected by
the Company to whom the Executive or his duly appointed guardian, if any, has no
reasonable objection, to determine whether the Executive is disabled, and such
determination shall for the purposes of this Agreement be conclusive. If such
question shall arise and the Executive shall fail to submit to such medical
examination, the Company’s determination of the issue shall be binding on the
Executive.

(c) By the Company for Cause. The Company may terminate the Executive’s
employment for Cause at any time upon notice to the Executive setting forth in
reasonable detail the nature of such Cause. The following, as determined by the
Board in its reasonable judgment, shall constitute “Cause” for termination:

(i) The Executive’s willful failure to perform, or gross negligence in the
performance of, the Executive’s material duties and responsibilities to the
Company or any of its Affiliates that, if capable of cure, is not cured within
thirty (30) days of written notice of such failure or negligence by the Company
to the Executive; provided, that the Company will not have to provide more than
one notice and opportunity to cure with respect to any multiple, repeated,
related or substantially similar events or circumstances;

(ii) Conduct by the Executive that constitutes fraud, embezzlement or other
material dishonesty with respect to the Company or any of its Affiliates;

 

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(iii) The Executive’s commission of, or plea of nolo contendere to, a felony or
crime involving moral turpitude;

(iv) The Executive’s violation of any law applicable to the Company;

(v) The Executive’s engagement in any conduct or omission which could reasonably
be expected to, or which does cause, the Company or any of its Affiliates public
disgrace, disrepute or economic harm; or

(vi) The Executive’s material breach of this Agreement, any material written
policies of the Company, or any other agreement between the Executive and the
Company or any of its Affiliates or of any fiduciary duty that the Executive has
to the Company or any of its Affiliates that, if capable of cure, is not cured
within thirty (30) days of written notice of such breach by the Company to the
Executive; provided, that the Company will not have to provide more than one
notice and opportunity to cure with respect to any multiple, repeated, related
or substantially similar events or circumstances.

Upon the giving of notice of termination of the Executive’s employment hereunder
for Cause, the Company shall have no further obligation or liability to the
Executive, other than for the Final Compensation due to the Executive. Other
than business expenses described in Section 5(a)(ii), the Final Compensation
shall be paid to the Executive at the time prescribed by applicable law and in
all events within thirty (30) days following the Termination Date.

(d) By the Company without Cause. The Company may terminate the Executive’s
employment hereunder without Cause at any time upon notice to the Executive. In
the event of such termination is at a time other than during the twelve
(12) month period following a Change of Control (as defined below), in addition
to the Final Compensation due to the Executive, the Company will pay or provide
the Executive the following (the “Severance Benefits”):

(i) the Company will continue to pay the Executive the monthly pro-rata portion
of his annual Base Salary at the rate in effect as of the Termination Date for
the nine (9) month period following the Termination Date (the “Severance
Period”);

(ii) the Company will pay the Executive an amount equal to his then current
Target Bonus, pro-rated for the number of days Executive was employed during the
applicable fiscal year, payable in substantially equal monthly installments
during the Severance Period; and

(iii) during the Severance Period, provided the Executive elects and remains
eligible for COBRA (or mini-COBRA), the Company will pay the Executive a monthly
taxable amount equal to the portion of the Executive’s health insurance premiums
that the Company paid immediately prior to the Termination Date.

Other than business expenses described in Section 5(a)(ii), the Final
Compensation shall be paid to the Executive at the time prescribed by applicable
law and in all events within thirty (30) days following the Termination Date.
Any obligation of the Company to provide the Severance Benefits is conditioned,
however, on the Executive signing and returning to the Company (without
revoking) a timely and effective general release of claims in the form provided
by the Company by the deadline specified therein, all of which (including the
lapse of the period for revoking the release of claims as specified in the
release of claims) shall have occurred no later than the sixtieth (60th)
calendar day following the date of termination (any such separation agreement
submitted by such deadline, the “Release of Claims”) and on the Executive’s
continued compliance in material respects with the obligations of the Executive
to the Company and its Affiliates that survive termination of his employment,
including without limitation under Sections 7, 8 and 9 of this Agreement.
Subject to Section 5(h) below, all Severance Benefits to which the Executive is
entitled hereunder shall be payable in accordance with the normal payroll
practices of the Company, with the first payment, which shall be retroactive to
the day immediately following the Termination Date, being due and payable on the
Company’s next regular payday for executives that follows the effective date of
the Release of Claims. Notwithstanding the foregoing, if the time period to
consider, return and revoke the Release of Claims covers two of the Executive’s
taxable years, any portion of the Severance Benefits that constitutes deferred
compensation subject to Section 409A (as defined below) shall in all events be
paid in the later taxable year. The Release of Claims required for Severance
Benefits in accordance with this Section 5(d) creates legally binding
obligations on the part of the Executive and the Company therefore advises the
Executive to seek the advice of an attorney before signing the Release of
Claims.

 

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(e) By the Executive for Good Reason. The Executive may terminate his employment
for Good Reason by (A) providing notice to the Company specifying in reasonable
detail the condition giving rise to the Good Reason no later than the thirtieth
(30th) day following the occurrence of that condition; (B) providing the Company
a period of thirty (30) days to remedy the condition and so specifying in the
notice; and (C) terminating his employment for Good Reason within thirty
(30) days following the expiration of the period to remedy if the Company fails
to remedy the condition. The following, if occurring without the Executive’s
consent, shall constitute “Good Reason” for termination by the Executive:

(i) a material diminution in the nature or scope of the Executive’s title,
duties, or responsibilities; or

(ii) a material reduction in Base Salary, which for purposes of this Agreement
shall mean a reduction of more than fifteen percent (15%) in the aggregate,
other than any reduction applying in a similar fashion to similarly situated
executives of the Company.

In the event of a termination of employment in accordance with this Section 5(e)
at a time other than during the twelve (12) month period following a Change of
Control, the Executive will be entitled to receive the Severance Benefits he
would have been entitled to receive had he been terminated by the Company
without Cause pursuant to Section 5(d) above, provided that the Executive signs
and returns (without revoking) a timely and effective Release of Claims as set
forth in Section 5(d).

(f) By the Executive without Good Reason. The Executive may terminate his
employment hereunder at any time upon thirty (30) days’ prior written notice to
the Company. In the event of termination of the Executive’s employment in
accordance with this Section 5(f), the Board may elect to waive the period of
notice, or any portion thereof, and, if the Board so elects, the Company will
pay the Executive the Base Salary for the period so waived. The Company shall
also pay the Executive the Final Compensation due to him (other than business
expenses described in Section 5(a)(ii)) at the time prescribed by applicable law
and in all events within thirty (30) days following the Termination Date.

(g) Termination Following a Change of Control. In the event of a termination of
the Executive’s employment within twelve (12) months following a Change of
Control either by the Company without Cause (in accordance with Section 5(d)) or
by the Executive for Good Reason (in accordance with Section 5(e)) and provided
that the Executive signs and returns (without revoking) a timely and effective
Release of Claims as set forth in Section 5(d), then: (A) the Executive will be
entitled to receive the Severance Benefits he would have been entitled to
receive had he been terminated by the Company without Cause pursuant to
Section 5(d) above, except that the Severance Period shall equal the twelve
(12) month period following the Termination Date; and (B) any options or RSUs
granted to Executive under an equity incentive plan adopted or to-be-adopted by
the Company (a “Plan”) shall, to the extent not assumed by an acquirer, vest in
full. The Company shall also pay the Executive the Final Compensation due to him
(other than business expenses described in Section 5(a)(ii)) at the time
prescribed by applicable law and in all events within thirty (30) days following
the Termination Date. For purposes of this Agreement, a “Change of Control”
shall mean the occurrence of any of the following events: (i) a sale, lease or
other disposition of all or substantially all of the assets of the Company;
(ii) a consolidation or merger of the Company with or into any other corporation
or other entity or person, or any other corporate reorganization, in which the
stockholders of the Company immediately prior to such consolidation, merger or
reorganization, own less than fifty percent (50%) of the outstanding voting
power of the surviving entity (and its parent) following the consolidation,
merger or reorganization; or (iii) any transaction (or series of related
transactions involving a person or entity, or a group of affiliated persons or
entities) in which in excess of fifty percent (50%) of the Company’s outstanding
voting power is transferred. For the avoidance of doubt, the transactions
contemplated by the Exchange Agreement shall not be considered a Change of
Control for purposes of this Agreement.

 

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(h) Timing of Payments and Section 409A.

(i) This Agreement and any payments or benefits provided hereunder shall be
interpreted, operated and administered in a manner intended to avoid the
imposition of additional taxes under Section 409A of the Internal Revenue Code
of 1986, as amended (the “Code”). Further, the Company and Executive hereto
acknowledge and agree that the form and timing of the payments and benefits to
be provided pursuant to this Agreement are intended to be exempt from, or to
comply with, one or more exceptions to the requirements of Section 409A of the
Code (“Section 409A”). Notwithstanding anything to the contrary in this
Agreement, if at the time of the Executive’s termination of employment, the
Executive is a “specified employee,” as defined below, any and all amounts
payable under this Section 5 on account of such separation from service that
constitute deferred compensation and would (but for this provision) be payable
within six (6) months following the date of termination, shall instead be paid
on the next business day following the expiration of such six (6) month period
or, if earlier, upon the Executive’s death; except (A) to the extent of amounts
that do not constitute a deferral of compensation within the meaning of Treasury
regulation Section 1.409A-1(b) (including without limitation by reason of the
safe harbor set forth in Section 1.409A-1(b)(9)(iii), as determined by the
Company in its reasonable good faith discretion); (B) benefits that qualify as
excepted welfare benefits pursuant to Treasury regulation
Section 1.409A-1(a)(5); or (C) other amounts or benefits that are not subject to
the requirements of Section 409A.

(ii) For purposes of this Agreement, all references to “termination of
employment” and correlative phrases shall be construed to require a “separation
from service” (as defined in Section 1.409A-1(h) of the Treasury regulations
after giving effect to the presumptions contained therein), and the term
“specified employee” means an individual determined by the Company to be a
specified employee under Treasury regulation Section 1.409A-1(i).

(iii) Each payment made under this Agreement shall be treated as a separate
payment and the right to a series of installment payments under this Agreement
is to be treated as a right to a series of separate payments.

(iv) Any payment of or reimbursement for expenses that would constitute
nonqualified deferred compensation subject to Section 409A shall be subject to
the following additional rules: (i) no reimbursement or payment of any such
expense shall affect the Executive’s right to reimbursement or payment of any
such expense in any other calendar year; (ii) reimbursement or payment of the
expense shall be made, if at all, promptly, but not later than the end of the
calendar year following the calendar year in which the expense was incurred; and
(iii) the right to reimbursement or payment shall not be subject to liquidation
or exchange for any other benefit.

 

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(v) In no event shall the Company have any liability relating to the failure or
alleged failure of any payment or benefit under this Agreement to comply with,
or be exempt from, the requirements of Section 409A.

(vi) Exclusive Right to Severance. The Executive agrees that the Severance
Benefits to be provided to him in accordance with the terms and conditions set
forth in this Agreement are intended to be exclusive with respect to severance
or termination pay and post-employment employee benefits. The Executive hereby
knowingly and voluntarily waives any right he might otherwise have to
participate in or receive benefits under any other plan, program or policy of
the Company providing for severance or termination pay or benefits.

6. Effect of Termination. The provisions of this Section 6 shall apply to any
termination of the Executive’s employment under this Agreement, whether pursuant
to Section 5 or otherwise.

(a) Provision by the Company of Final Compensation and Severance Benefits, if
any, that are due the Executive in each case under the applicable termination
provision of Section 5 shall constitute the entire obligation of the Company to
the Executive with respect to severance or termination pay and post-employment
employee benefits.

(b) Except for any right of the Executive to continue group health plan
participation in accordance with applicable law, the Executive’s participation
in all employee benefit plans shall terminate pursuant to the terms of the
applicable plan documents based on the date of termination of the Executive’s
employment without regard to any Base Salary for notice waived pursuant to
Section 5(f) hereof or to any Severance Benefits or other payment made to or on
behalf of the Executive following such date of termination.

(c) Provisions of this Agreement shall survive any termination of the
Executive’s employment if so provided herein or if necessary or desirable fully
to accomplish the purposes of other surviving provisions, including without
limitation the obligations of the Executive under Sections 7, 8 and 9. The
obligation of the Company to provide Severance Benefits hereunder, and
Executive’s right to retain such payments, is expressly conditioned on the
Executive’s continued compliance in all material respects with Sections 7, 8 and
9. The Executive recognizes that, except as expressly provided in Sections 5(d),
5(e), and 5(g) or with respect to Base Salary paid for notice waived pursuant to
Section 5(f), no cash compensation or benefits will be earned after termination
of employment.

7. Confidential Information.

(a) Nondisclosure. At all times during the Term and thereafter, Executive will
hold in strictest confidence and will not disclose, use, or publish any of the
Company’s Proprietary Information (as defined below), except as such disclosure,
use or publication may be required in connection with Executive’s work for the
Company or as allowed by Section 7(b) below. Executive shall obtain the
Company’s written approval before publishing or submitting for publication any
material (written, verbal, or otherwise) that relates to Executive’s work at the
Company and/or incorporates any Proprietary Information. Executive hereby
assigns to the Company any rights Executive may have or acquire in such
Proprietary Information and recognize that all Proprietary Information shall be
the sole property of the Company and its assigns. Executive hereby undertakes
not to divulge in any manner whatsoever and use Executive’s best efforts to keep
confidential any access codes, passwords, or any information which may assist or
facilitate access to Company’s Proprietary Information.

 

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(b) Notice. In the event that Executive is required by law or requested or
required (by oral questions, interrogatories, requests for information or
documents, subpoena, civil investigative demand or similar process) to disclose
any of the Proprietary Information, or any information relating to Executive’s
opinion, judgment or recommendations concerning the Proprietary Information,
Executive will provide the Company with prompt written notice of such
request(s), to the extent practicable in such circumstances, so that the Company
may seek an appropriate protective order or other appropriate remedy and/or
waive compliance with the relevant provisions of this Agreement. In the event
that such protective order or other remedy is not obtained, or that the Company
grants a waiver hereunder, Executive may furnish that portion (and only that
portion) of the Proprietary Information which, upon the advice of Executive’s
counsel, Executive is legally compelled to disclose. In any event, Executive
will not oppose any action by the Company to obtain an appropriate protective
order or other reliable assurance that confidential treatment will be accorded
to the Proprietary Information.

(c) Proprietary Information. For purposes of this Agreement, “Proprietary
Information” means any and all confidential and/or proprietary knowledge, data
or information of the Company, whether developed by, received by, or was or is
otherwise accessible to Executive before or after the Effective Date. By way of
illustration but not limitation, “Proprietary Information” includes (i) trade
secrets, inventions, mask works, ideas, processes, formulas, source and object
codes, data, programs, other works of authorship, know-how, improvements,
discoveries, developments, designs and techniques (excluding inventions not
assignable under Section 8(c), hereinafter collectively referred to as
“Inventions”); (ii) information regarding plans for research, development, new
products, marketing and selling, business plans, budgets and unpublished
financial statements, licenses, prices and costs, suppliers and customers; and
(iii) information regarding the skills and compensation of other employees of
the Company. Notwithstanding the foregoing, it is understood that “Proprietary
Information” shall not include information that: (A) is or becomes generally
known to the public through no breach by Executive of this Agreement; (B) can be
demonstrated by written records to have been known by Executive prior to
Executive’s employment and/or work with the Company; (C) is hereafter rightfully
obtained by Executive from a third party who does not breach any obligation he
or she may have to the Company; or (D) is approved for release by written
authorization of the Board of Directors of the Company. Furthermore, Executive
understands that Executive is free to use information which is generally known
in the trade or industry, which is not gained as result of a breach of this
Agreement, to whatever extent and in whichever way Executive wishes.

(d) Third Party Information. Executive understands, in addition, that the
Company has received and in the future will receive from third parties
confidential or proprietary information (“Third Party Information”) subject to a
duty on the Company’s part to maintain the confidentiality of such information
and to use it only for certain limited purposes. During the Employment Period
and thereafter, Executive will hold Third Party Information in the strictest
confidence and will not disclose to anyone (other than Company personnel who
need to know such information in connection with their work for the Company and
subject to Section 7(b) above) or use, except in connection with Executive’s
work for the Company, Third Party Information unless expressly authorized by an
officer of the Company in writing.

(e) Defend Trade Secrets Act. Under the Defend Trade Secrets Act of 2016, the
Company hereby provides notice and Executive hereby acknowledges that Executive
may not be held criminally or civilly liable under any federal or state trade
secret law for the disclosure of a trade secret that (i) is made (A) in
confidence to a federal, state, or local government official, either directly or
indirectly, or to an attorney and (B) is solely for the purpose of reporting or
investigating a suspected violation of law; or (ii) is made in a complaint or
other document filed in a lawsuit or other proceeding, if such filing is made
under seal.

 

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8. Assignment of Rights to Intellectual Property.

(a) Proprietary Rights. The term “Proprietary Rights” shall mean: (i) patents,
whether in the form of utility patents or design patents and all pending
applications for such patents; (ii) trademarks, trade names, service marks,
designs, logos, trade dress, and trade styles, whether or not registered, and
all pending applications for registration of the same; (iii) copyrights or
copyrightable material, including but not limited to books, articles and
publications, whether or not registered, and all pending applications for
registration of the same; (iv) inventions, research records, trade secrets,
confidential information, product designs, engineering specifications and
drawings, technical information, formulae, customer lists, supplier lists and
market analyses; (v) computer programs, including, without limitation, computer
programs embodied in semiconductor chips or otherwise embodied, and related
flow-charts, programmer notes, updates and data, whether in object or source
code form; and (vi) all other intellectual property rights throughout the world.

(b) Assignment of Inventions. Subject to Section 8(c), Executive hereby assigns
and agrees to assign in the future (when any such Inventions or Proprietary
Rights are first reduced to practice or first fixed in a tangible medium, as
applicable) to the Company all of Executive’s right, title and interest in and
to any and all Inventions (and all Proprietary Rights with respect thereto)
whether or not patentable or registrable under copyright or similar statutes,
made or conceived or reduced to practice or learned by Executive, either alone
or jointly with others, in connection with Executive’s employment and/or work
for the Company. Inventions assigned to the Company, or to a third party as
directed by the Company pursuant to this Section 8, are hereinafter referred to
as “Company Inventions.”

(c) Nonassignable Inventions. This Agreement will not be deemed to require
assignment of any invention which was developed entirely on Executive’s own time
without using the Company’s equipment, supplies, facilities, or Proprietary
Information and neither related to the Company’s actual or anticipated business,
research or development, nor resulted from work performed by Executive for the
Company.

(d) Government or Third Party. Executive agrees to assign all of Executive’s
right, title and interest in and to any particular Company Invention to any
third party, including without limitation government agency, as directed by the
Company.

(e) Works for Hire. Executive acknowledges that all original works of authorship
which are made by Executive (solely or jointly with others) within the scope of
Executive’s employment and which are protectable by copyright are the property
of the Company pursuant to applicable copyright law.

(f) Enforcement of Proprietary Rights. Executive will assist the Company in
every proper way to obtain, and from time to time enforce, any Proprietary
Rights relating to Company Inventions in any and all countries. To that end
Executive will execute, verify and deliver such documents and perform such other
acts (including appearances as a witness) as the Company may reasonably request
for use in applying for, obtaining, perfecting, evidencing, sustaining and
enforcing such Proprietary Rights and the assignment thereof. In addition,
Executive will execute, verify and deliver assignments of such Proprietary
Rights to the Company or its designee. Executive’s obligation to assist the
Company with respect to Proprietary Rights relating to such Company Inventions
in any and all countries shall continue beyond the termination of Executive’s
employment, but the Company shall compensate Executive at a reasonable rate
after Executive’s termination for the time actually spent by Executive at the
Company’s request on such assistance.

 

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(g) Attorney in Fact. In the event the Company is unable for any reason, after
reasonable effort, to secure Executive’s signature on any document needed in
connection with the actions specified in the preceding paragraph, Executive
hereby irrevocably designates and appoints the Company and its duly authorized
officers and agents as Executive’s agent and attorney in fact, which appointment
is coupled with an interest, to act for and in Executive’s behalf to execute,
verify and file any such documents and to do all other lawfully permitted acts
to further the purposes of the preceding paragraph with the same legal force and
effect as if executed by Executive. Executive hereby waives and quitclaims to
the Company any and all claims, of any nature whatsoever, which Executive now or
may hereafter have for infringement of any Proprietary Rights assigned hereunder
to the Company.

(h) Records. Executive agrees to keep and maintain adequate and current records
(in the form of notes, sketches, drawings and in any other form that may be
required by the Company) of all Proprietary Information developed by Executive
and all Inventions made by Executive during the period of Executive’s employment
at the Company, which records shall be available to and remain the sole property
of the Company at all times.

9. Restrictive Covenants.

(a) Non-Competition. During the Term and for the twelve (12) month period after
the termination of Executive’s employment relationship with the Company for any
reason, Executive will not, directly or indirectly, whether paid or not:
(i) serve as a partner, principal, licensor, licensee, employee, consultant,
officer, director, manager, agent, affiliate, representative, advisor, promoter,
associate, investor, or otherwise for, (ii) own, purchase, organize or take
preparatory steps for the organization of, or (iii) build, design, finance,
acquire, lease, operate, manage, control, invest in, work or consult for or
otherwise join, participate in or affiliate with, any business whose business,
products or operations are in any respect involved in a Restricted Business
(defined below) anywhere in the Restricted Territory (defined below). Should
Executive obtain other employment during the Term or within the twelve
(12) month period immediately following the Termination Date, Executive agrees
to provide written notification to the Company as to the name and address of
Executive’s new employer, the position that Executive expects to hold, and a
general description of Executive’s duties and responsibilities, at least three
business days prior to starting such employment.

(b) Non-Solicitation. During the Term and for the twelve (12) month period after
the termination of Executive’s employment relationship with the Company for any
reason, including, without limitation, as a result of a voluntary termination by
Executive or involuntary termination by Company, Executive will not, as an
officer, director, employee, consultant, owner, partner, or in any other
capacity, either directly or through others, except on behalf of Company:

(i) Solicit, induce, encourage, or participate in soliciting, inducing or
encouraging any person known (or should have been known) to Executive to be an
employee, consultant, or independent contractor of Company (or was an employee,
consultant, or independent contractor of the Company in the twelve (12) moths
prior to the Termination Date) to terminate his or her relationship with
Company, even if Executive did not initiate the discussion or seek out the
contact;

(ii) Solicit, induce, encourage, or participate in soliciting, inducing, or
encouraging any person known to Executive (or should have been known to
Executive) to be an employee, consultant, or independent contractor of Company
to terminate his or her relationship with Company to render services to
Executive or any other person or entity that researches, develops, markets,
sells, performs or provides or is preparing to develop, market, sell, perform or
provide Conflicting Services (as defined below);

(iii) Hire, employ, or engage in a business venture with as partners or owners
or other joint capacity, or attempt to hire, employ, or engage in a business
venture as partners or owners or other joint capacity, with any person then
employed by Company or who has left the employment of Company within the
preceding twelve (12) months to research, develop, market, sell, perform or
provide Conflicting Services;

 

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(iv) Solicit, induce or attempt to induce any Customer or Potential Customer (as
defined below), to terminate, diminish, or materially alter in a manner harmful
to Company its relationship with Company;

(v) Solicit or assist in the solicitation of any Customer or Potential Customer
to induce or attempt to induce such Customer or Potential Customer to purchase
or contract for any Conflicting Services; or

(vi) Perform, provide or attempt to perform or provide any Conflicting Services
for a Customer or Potential Customer.

(c) Non-Disparagement. Executive shall not make, directly or indirectly, through
any other person or entity, any negative, derogatory or disparaging statements
or communications, whether written or oral, about the Company, or any of their
respective Affiliates, businesses, services, activities, business relationships,
shareholders, members, partners, directors, officers, managers or employees. The
foregoing shall not be violated by truthful statements in response to legal
process, required governmental testimony or filings, or administrative or
arbitral proceedings (including, without limitation, depositions in connection
with such proceedings) with competent jurisdiction to order such person or
entity to disclose or make accessible such information, nor will the foregoing
be violated by truthful statements to any government agency.

(d) Cooperation. Except as described in Section 9(e), Executive agrees to
reasonably cooperate with the Company in connection with any action, suit, or
proceeding, whether or not by or in the right of the Company and whether civil,
criminal, administrative, investigative or otherwise. The Company’s request for
“reasonable cooperation” shall take into consideration Executive’s personal and
business commitments and the amount of notice provided to Executive by the
Company. The Company will reimburse Executive for reasonable out-of-pocket
expenses that Executive incurs in providing any requested cooperation, so long
as Executive provides advance written notice to the Company of Executive’s
request for reimbursement and provides satisfactory documentation of the
expenses.

(e) Whistleblower. Nothing in Sections 7, 8, or 9 shall prohibit Executive from
reporting possible violations of federal law or regulation to any governmental
agency or entity including but not limited to the Department of Justice, the
Securities and Exchange Commission, the Equal Employment Opportunity Commission,
and any Inspector General, or making other disclosures that are protected under
the whistleblower provisions of federal law or regulation. Executive does not
need the prior authorization of the Company to make any such reports or
disclosures and Executive is not required to notify the Company that Executive
has made such reports or disclosures. Executive understands that by signing this
Agreement, Executive waives the right to any monetary recovery in connection
with a local, state or federal governmental agency proceeding and Executive
waives the right to file a claim seeking monetary damages in any court,
administrative agency or arbitral tribunal. Notwithstanding the foregoing,
nothing in this Agreement prohibits Executive from seeking or obtaining a
whistleblower award from the Securities and Exchange Commission (and not the
Company) pursuant to Section 21F of the Securities Exchange Act of 1934, as
amended.

(f) Definitions. Capitalized words or phrases shall have the following meanings
for purposes of this Agreement:

(i) “Conflicting Services” means any business in which the Company is engaged,
or in which the Company has plans to be engaged, or any service that the Company
provides or has plans to provide.

 

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(ii) “Customer or Potential Customer” is any person or entity who or which, at
any time during the one (1) year period prior to Executive’s contact with such
person or entity as described in Sections 9(b)(iv), (v) and (vi) if such contact
occurs during the Term or, if such contact occurs following the Term, during the
one (1) year period prior to the Termination Date: (i) contracted for, was
billed for, or received from the Company any product, service or process with
which Executive worked directly or indirectly during my employment by Company or
about which Executive acquired Proprietary Information; or (ii) was in contact
with Executive or in contact with any other employee, owner, or agent of
Company, of which contact Executive was or should have been aware, concerning
the sale or purchase of, or contract for, any product, service or process with
which Executive worked directly or indirectly during the Term or about which
Executive acquired Proprietary Information; or (iii) was solicited by Company in
an effort in which Executive was involved or of which Executive was aware.

(iii) “Restricted Business” means (A) the business of the Company related to the
design, manufacture, production, research or sale of tri-/tetra-valent
bispecific antibodies (mAb2) containing antigen-binding sites engineered into
non-CDR loops or antibody fragments containing antigen-binding sites engineered
into non-CDR loops or (B) any other business in which the Company is engaged or
contemplates engaging in at the time of, or during the twelve (12) month period
prior to, the Termination Date.

(iv) “Restricted Territory” means anywhere in the world.

10. Enforcement of Covenants. The Executive acknowledges that he has carefully
read and considered all the terms and conditions of this Agreement, including
the restraints imposed upon him pursuant to Sections 7, 8 and 9, and has had the
opportunity to consult with legal counsel of Executive’s choosing regarding such
terms and conditions. The Executive agrees without reservation that each of the
restraints contained herein is necessary for the reasonable and proper
protection of the goodwill, Proprietary Information and other legitimate
interests of the Company and its Affiliates; that each and every one of these
restraints is reasonable in respect to subject matter, length of time and
geographic area; and that these restraints, individually or in the aggregate,
will not prevent him from obtaining other suitable employment during the period
in which the Executive is bound by them. The Executive further agrees that he
will never assert, or permit to be asserted on his behalf, in any forum, any
position contrary to the foregoing. The Executive further acknowledges that,
were he to breach any of the covenants contained in Sections 7, 8 or 9, the
damage to the Company and its Affiliates would be irreparable. The Executive
therefore agrees that the Company, in addition to any other remedies available
to it, shall be entitled to preliminary and permanent injunctive relief against
any breach or threatened breach by the Executive of any of said covenants,
without having to post bond, and will additionally be entitled to an award of
attorney’s fees incurred in connection with securing any relief hereunder. The
parties further agree that, in the event that any provision of Section 7, 8 or 9
shall be determined by any court of competent jurisdiction to be unenforceable
by reason of its being extended over too great a time, too large a geographic
area or too great a range of activities, such provision shall be deemed to be
modified to permit its enforcement to the maximum extent permitted by law. The
Executive agrees that the restricted periods herein shall be tolled, and shall
not run, during any period of time in which he is in violation of the terms
thereof, in order that the Company and its Affiliates shall have all of the
agreed-upon temporal protection recited herein. No breach of any provision of
this Agreement by the Company, or any other claimed breach of contract or
violation of law, or change in the nature or scope of the Executive’s employment
relationship with the Company, shall operate to extinguish the Executive’s
obligation to comply with Sections 7, 8 and 9. Each of the Company’s Affiliates
shall have the right to enforce all of the Executive’s obligations to that
Affiliate under this Agreement, including without limitation pursuant to
Section 7, 8 or 9.

 

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11. No Conflicting Agreements. The Executive hereby represents and warrants that
the execution of this Agreement and the performance of his obligations hereunder
will not breach or be in conflict with any other agreement to which the
Executive is a party or is bound and that the Executive is not now subject to
any covenants against competition or similar covenants or any other obligations
to any person or to any court order, judgment or decree that would affect the
performance of his obligations hereunder. The Executive will not disclose to or
use on behalf of the Company any proprietary information of a third party
without such party’s consent.

12. Withholding. All payments made by the Company under this Agreement shall be
reduced by any tax or other amounts required to be withheld by the Company under
applicable law.

13. Section 280G.

(a) In the event that the Company undergoes a “change in ownership or control”
(within the meaning of Section 280G of the Code and the regulations and guidance
promulgated thereunder (“Section 280G”)) and all, or any portion, of the
payments provided under this Agreement, either alone or together with other
payments or benefits which the Executive receives or is entitled to receive from
the Company (collectively, the “Total Payments”), could constitute an “excess
parachute payment” within the meaning of Section 280G, then the Executive shall
be entitled to receive (i) an amount limited (to the minimum extent necessary)
so that no portion of the Total Payments shall be non-deductible for US federal
income taxes by reason of Section 280G (the “Limited Amount”), or (ii) if the
amount of the Total Payments (without regard to clause (i)) reduced by the
excise tax imposed by Section 4999 of the Code (the “Excise Tax”) and the amount
of all other applicable federal, state and local taxes (with income taxes all
computed at the highest applicable marginal rate) is greater than the Limited
Amount reduced by the amount of all taxes applicable thereto (with income taxes
all computed at the highest marginal rate), the amount of the Total Payments
otherwise payable without regard to clause (i). If it is determined that the
Limited Amount will maximize the Employee’s after-tax proceeds, the Total
Payments shall be reduced to equal the Limited Amount in the following order:
(i) first, by reducing cash severance payments that are exempt from
Section 409A, (ii) second, by reducing other payments and benefits that are
exempt from Section 409A and to which Q&A 24(c) of Section 1.280G-1 of the
Treasury Regulations does not apply, (iii) third, by reducing all remaining
payments and benefits that are exempt from Section 409A and (iv) finally, by
reducing payments and benefits that are subject to Section 409A, in each case,
with all such reductions done on a pro rata basis.

(b) All determinations made pursuant this Section 13 will be made at the
Company’s or its Affiliates’ expense by an accounting firm or consulting group
with experience in performing calculations regarding the applicability of
Section 280G and Section 4999 of the Code selected by the Company for such
purpose (the “Independent Advisors”). For purposes of such determinations, no
portion of the Total Payments shall be taken into account which, in the opinion
of the Company and its legal advisors, (y) does not constitute a “parachute
payment” within the meaning of Section 280G(b)(2) of the Code (including by
reason of Section 280G(b)(4)(A) of the Code) or (z) constitutes reasonable
compensation for services actually rendered, within the meaning of
Section 280G(b)(4)(B) of the Code, in excess of the “base amount” (as defined in
Section 280G(b)(3) of the Code) allocable to such reasonable compensation. In
the event it is later determined that (A) a greater reduction in the Total
Payments should have been made to implement the objective and intent of this
Section 13, the excess amount shall be returned immediately by the Executive to
the Company or (B) a lesser reduction in the Total Payments should have been
made to implement the objective and intent of this Section 13, the additional
amount shall be paid immediately by the Company, or any Affiliate of the
Company, as applicable, to the Executive.

 

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14. Assignment. Neither the Company nor the Executive may make any assignment of
this Agreement or any interest herein, by operation of law or otherwise, without
the prior written consent of the other; provided, however, that (a) the Company
may assign its rights and obligations under this Agreement without the consent
of the Executive to one of its Affiliates, or in the event that the Company
shall hereafter effect a reorganization with, consolidate with, or merge into,
an Affiliate or any person or transfer or have transferred all or substantially
all of its properties, outstanding stock, or assets to an Affiliate or any
person and (b) in the event that all of the Company’s rights and obligations
under this Agreement are assigned pursuant to this Section 14, each reference to
Company herein shall be deemed from and after such assignment instead to be a
reference to the assignee. This Agreement shall inure to the benefit of and be
binding upon the Company and the Executive, and their respective successors,
executors, administrators, heirs and permitted assigns.

15. Severability. If any portion or provision of this Agreement shall to any
extent be declared illegal or unenforceable by a court of competent
jurisdiction, then the remainder of this Agreement, or the application of such
portion or provision in circumstances other than those as to which it is so
declared illegal or unenforceable, shall not be affected thereby, and each
portion and provision of this Agreement shall be valid and enforceable to the
fullest extent permitted by law.

16. Waiver. No waiver of any provision hereof shall be effective unless made in
writing and signed by the waiving party. The failure of either party to require
the performance of any term or obligation of this Agreement, or the waiver by
either party of any breach of this Agreement, shall not prevent any subsequent
enforcement of such term or obligation or be deemed a waiver of any subsequent
breach.

17. Notices. Any and all notices, requests, demands and other communications
provided for by this Agreement shall be in writing and shall be effective when
delivered in person, consigned to a reputable national courier service or
deposited in the United States mail, postage prepaid, registered or certified,
and addressed to the Executive at his last known address on the books of the
Company or, in the case of the Company, at its principal place of business,
attention of the CEO, or to such other address as either party may specify by
notice to the other actually received.

18. Entire Agreement. This Agreement constitutes the entire agreement between
the parties and supersedes and terminates all prior communications, agreements
and understandings, written or oral, with respect to the terms and conditions of
the Executive’s employment relationship with the Company; provided, however,
that the Executive shall remain entitled to receive the success bonus pursuant
to paragraph 3(c) of the Offer Letter and the retention bonus pursuant to
paragraph 3(e) of the Offer Letter, each of which will paid as soon as
practicable following the Closing (as defined in the Exchange Agreement).

19. Amendment. This Agreement may be amended or modified only by a written
instrument signed by the Executive and by an expressly authorized representative
of the Company.

20. Headings. The headings and captions in this Agreement are for convenience
only and in no way define or describe the scope or content of any provision of
this Agreement.

21. Counterparts. This Agreement may be executed in two or more counterparts,
each of which shall be an original and all of which together shall constitute
one and the same instrument.

22. Governing Law. This is a New York contract and shall be construed and
enforced under and be governed in all respects by the laws of New York, without
regard to any conflict of laws principles that would result in the application
of the laws of any other jurisdiction.

[The remainder of this page has been left blank intentionally.]

 

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IN WITNESS WHEREOF, this Agreement has been executed as a sealed instrument by
the Company, by its duly authorized representative, and by the Executive, as of
the date first above written.

 

F-STAR THERAPEUTICS LLC

/s/ Eliot Forster

Name: Eliot Forster Title: Chief Executive Officer

 

EXECUTIVE /s/ Louis Kayitalire Louis Kayitalire

[Signature Page to Employment Agreement]