Exhibit 10.39

NOTE: Portions of this Exhibit are the subject of a Confidential Treatment
Request by the Registrant to the Securities and Exchange Commission (the
“Commission”). Such portions have been redacted and are marked with a “[***]” in
the place of the redacted language. The redacted information has been filed
separately with the Commission.

SECOND AMENDMENT OF THE RESEARCH AND COMMERCIAL LICENSE OPTION AGREEMENT

The Parties to the Research and Commercial License Option Agreement of
October 1, 2005 as previously amended (“Agreement”), Sangamo BioSciences, Inc.,
a Delaware corporation having its principal place of business at Point Richmond
Tech Center, 501 Canal Boulevard, Suite A100, Richmond, California 94804
(“Sangamo”), and Dow AgroSciences LLC, a Delaware limited liability company
having its principal place of business at 9330 Zionsville Road, Indianapolis, IN
46268 (“DAS”), hereby further amend the Agreement as follows:

A. Sangamo acknowledges that it has received all payments due from DAS pursuant
to Section 8.3(a) of the Agreement for the Research Program through the end of
the Initial Research Term which expired on September 31, 2008, and each Party
acknowledges that payment by DAS of a final five hundred thousand dollar
($500,000) payment, that will be invoiced by Sangamo as of January 31, 2008,
will satisfy DAS’s research funding obligations for the Research Program through
the end of 2008.

B. Section 8.3 (b) of the Agreement is amended to read:

“(b) DAS and Sangamo agree to carry out, subject part “D” of the Second
Amendment to this Agreement, the following Research Plan during calendar year
2009 of the Subsequent Research Term, which Research Plan has the four following
elements with the indicated budget for each element:

Element 1. $162,500 for [***] FTE at Sangamo to endeavor to establish a [***]
sequence-based methodology for analysis of genome editing and to transfer such
methodology to DAS as it is being developed.

Element 2. $487,500 for [***] FTEs at Sangamo to endeavor to identify and
characterize [***] domains for use as zinc-finger protein fusion partners,
including research directed to developing a [***] system for testing potential
[***] of zinc-finger proteins and, in collaboration with DAS, establishing a
[***] system for testing potential [***] of zinc-finger proteins.

Element 3. $1,625,000 for [***] FTEs at Sangamo to support the following ZFP/ZFN
supply activities:

a. Supplying (including design, assembly, and optimization as necessary) DAS
with ZFP Products for up to [***] targets, but not more than [***] targets per
quarter and [***] targets per month; provided, however, that if Sangamo is not

 

*** CONFIDENTIAL PORTIONS OMITTED AND FILED SEPARATELY WITH THE COMMISSION

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able to generate ZFP Products for a particular target despite good faith
attempts to do so, Sangamo may discontinue work on such target after discussing
such matter with DAS.

b. Providing [***] DNA (ZFN) and [***] (ZFP TF) Assays.

c. Providing molecular biology support such as cloning into DAS vectors and
running [***] assays, [***] assays and genomic [***] and [***] detection assays.

The Parties agree that DAS may request that Sangamo supply ZFP Products for more
than [***] targets in 2009 and, if Sangamo accepts any such requests for
supplying ZFP Products for additional targets, then Sangamo will provide such
supply-related services at $[***] per additional target.

Element 4. $487,500 for [***] FTEs to perform the following technology transfer
activities at Sangamo during the first six months of 2009:

a. Sangamo to consult with DAS and Sigma-Aldrich Co. (“Sigma”) and transfer
during the first quarter of 2009 (“Q1”) and the second quarter of 2009 (“Q2”) as
much of DAS’s third quarter of 2009 (“Q3”) and fourth quarter of 2009 (“Q4”) ZFP
Product [***] to Sigma as DAS decides is practicable.

b. Sangamo effort during Q1 and Q2 to expand archive to [***] members

c. Sangamo effort during Q1 to streamline the [***] process

d. Sangamo effort during Q1 to transfer [***] assay system to Sigma

e. Sangamo effort during Q2 to transfer [***] archive to Sigma

f. Sangamo effort during Q2 to transfer [***] technology to Sigma.

If the technology transfer to Sigma is not completed by June 30, 2009, the
Parties will mutually agree upon the FTEs required and deliverables and payment
schedule for the additional technology transfer that is required.”

C. DAS shall pay the following amounts to Sangamo for its Diligent Efforts to
perform the Research Plan described in part “B” above:

 

  a. $812,500 per quarter for each of Q1 and Q2 (billed net 30 days at the
beginning of each quarter (or in the case of Q1, as soon as practicable after
the signing of this Second Amendment));

 

  b. $568,750 for each of Q3 and Q4 (billed net 30 days at the beginning of each
quarter);

 

  c. Additional amounts for more than 25 targets to be paid net 30 days from the
date the request is accepted by Sangamo;

 

  d. Additional amounts for tech transfer or other services requested by DAS and
accepted by Sangamo will be billed monthly and paid net 30 days.

 

  e. A mutually agreed upon amount for any [***] performed by Sangamo on behalf
of DAS and will be billed monthly and paid net 30 days.

D. DAS may cancel any part of the work to be carried out after June 30, 2009, on
ninety (90) days written notice. The work scheduled to be carried out prior to
June 30,

 

*** CONFIDENTIAL PORTIONS OMITTED AND FILED SEPARATELY WITH THE COMMISSION

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2009 may only be cancelled as result of termination of the Agreement in
accordance with Section 11.6 of the Agreement on account of the uncured material
breach of a Party.

E. Except as amended hereby or pursuant to the First Amendment, the Agreement
shall remain in full force and effect. Those amendments made herein shall be
effective as of the Second Amendment Effective Date.

IN WITNESS WHEREOF, the Parties have executed this Second Amendment of the
Research and Commercial License Option Agreement in duplicate originals by their
proper officers as of January             , 2009 (“Second Amendment Effective
Date”).

AGREED TO AND ACCEPTED BY:

 

Sangamo BioSciences, Inc.     Dow AgroSciences LLC By:  

/s/ Philip Gregory

    By:  

/s/ William A. Kleschick

  Philip Gregory, D.Phil.       William A. Kleschick, Ph.D. Title:   Vice
President, Research     Title:   Global Leader, Discovery Date:  

January 28, 2009

    Date:  

February 10, 2009

      By:  

/s/ Jerome Peribere

        Jerome Peribere       Title:   President & CEO       Date:  

February 13, 2009