Exhibit 10.1

FORM OF

SUBSCRIPTION AGREEMENT

This SUBSCRIPTION AGREEMENT (this “Agreement”) is entered into as of August __,
2008, by and among Arrowhead Research Corporation, a Delaware corporation (the
“Company”), and the investors listed on the Schedule of Buyers attached hereto
(each, a “Buyer” and collectively, the “Buyers”).

WHEREAS, the Company has registered on Form S-3 (SEC File No. 333-148218) (the
“Registration Statement”) the issuance and sale of up to $50,000,000 of certain
types of securities, including shares of its Common Stock, $0.001 par value per
share (“Common Stock”);

WHEREAS, the Company has authorized the issuance of (i) up to
                     shares (the “Shares”) of the Company’s common stock, $0.001
par value per share (the “Common Stock”), and (ii) warrants, in the form
attached hereto as Exhibit A (the “Warrants” and together with the Shares the
“Securities”) to purchase up to                      shares of Common Stock (the
“Warrant Shares”) pursuant to the terms of this Agreement, with the offer and
sale to be made pursuant to the prospectus, dated January 30, 2008, contained in
the Registration Statement, as supplemented by the Company’s prospectus
supplement, dated August     , 2008, a copy of which has been delivered to each
Buyer concurrently with this Agreement (the “Prospectus”); and

WHEREAS, the Buyers wish to purchase, upon the terms and subject to the
conditions set forth in this Agreement, the Securities in the respective amounts
set forth opposite each Buyer’s name on the Schedule of Buyers attached hereto.

 

1. PURCHASE AND SALE OF SECURITIES.

1.1. Purchase of Securities. Subject to the satisfaction (or waiver) of the
conditions set forth in Sections 5 and 6 below, at the closing (the “Closing”)
the Company shall issue and sell to each Buyer, and each Buyer severally and not
jointly with the other Buyers agrees to purchase from the Company, (A) the
respective number of Shares set forth opposite such Buyer’s name on the
signature page attached hereto, and (B) a Warrant entitling the Buyer to
purchase that number of Warrant Shares set forth opposite such Buyer’s name on
the signature page, for the aggregate purchase price (the “Purchase Price”) set
forth opposite such Buyer’s name on the signature page.

1.2. Closing Date. Unless the Company and a Buyer agree otherwise and subject to
the conditions set forth in Sections 5 and 6, the date and time of the Closing
(the “Closing Date”) shall be as soon as practicable after the date hereof, but
in no event later than noon Pacific Time on August     , 2008. The Closing shall
occur at the offices of Goodwin Procter LLP, counsel to the Company, located at
10250 Constellation Boulevard, 21st Floor Los Angeles, California 90067. The
Closing need not occur at the same time with respect to all Buyers and
references in this Agreement to the Closing Date shall refer to the date of
Closing for each particular Buyer, as determined pursuant to this Section 1.2.

 

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1.3. Form of Payment. On the Closing Date, (i) each Buyer shall pay an amount
equal to the Purchase Price to the Company for the Securities to be issued and
sold to such Buyer at the Closing, by wire transfer of immediately available
funds in accordance with the Company’s written wire instructions, (ii) the
Company shall instruct its transfer agent to issue and deliver to each Buyer the
number of the Shares that such Buyer is then purchasing (as indicated opposite
such Buyer’s name on the signature page), and (iii) the Company shall issue the
Warrants and deliver same to each Buyer. The Company shall deliver the Shares,
and the Warrant Shares upon exercise of the Warrants, to each Buyer by
electronic transfer (e.g., DWAC), unless a Buyer requests delivery of physical
certificates.

 

2. BUYERS’ REPRESENTATIONS AND WARRANTIES.

Each Buyer represents and warrants, severally and not jointly, that:

2.1. Information. Buyer and its advisors, if any, have been furnished with all
materials relating to the business, finances and operations of the Company and
materials relating to the offer and sale of the Securities that have been
requested by Buyer. Buyer and its advisors, if any, have been afforded the
opportunity to ask questions of the Company. Buyer understands that its
investment in the Securities involves a high degree of risk, including the risks
identified under the caption “Risk Factors” in the Prospectus. Neither such
inquiries nor any other investigation conducted by or on behalf of Buyer or its
advisors shall modify, amend or affect Buyer’s right to rely on the truth,
accuracy and completeness of the disclosure made to Buyer or its advisors in
respect of the Company or this transaction and the Company’s representations and
warranties contained in this Agreement.

2.2. Investment for Own Account. Buyer represents that it is acquiring the
Securities for its own account, or an account over which it has investment
discretion, and does not have any agreement or understanding, directly or
indirectly, with any person or entity to distribute any of the Securities.

2.3. No Short Sales. Neither Buyer nor any person acting on behalf of, or
pursuant to any understanding with or based upon any information received from,
Buyer has, directly or indirectly, as of the date hereof, engaged in any
transactions in the securities of the Company (including, without limitation,
any Short Sales involving the Company’s securities) since the time that Buyer
was first contacted by the Company or its representatives with respect to the
transactions contemplated hereby. “Short Sales” include, without limitation, all
“short sales” as defined in Rule 200 promulgated under Regulation SHO under the
Exchange Act. Buyer covenants that neither it, nor any person acting on behalf
of, or pursuant to any understanding with or based upon any information received
from, Buyer will engage in any transactions in the securities of the Company
(including, without limitation, Short Sales) prior to the time that the
transactions contemplated by this Agreement are publicly disclosed. Buyer agrees
that it will not use any of the Securities acquired pursuant to this Agreement
to cover any short position in the Common Stock if doing so would be in
violation of applicable securities laws.

 

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2.4. No Governmental Review. Buyer understands that no United States federal or
state agency or any other government or governmental agency has passed on or
made any recommendation or endorsement of the Securities or the fairness or
suitability of the investment in the Securities nor have such authorities passed
upon or endorsed the merits of the offering of the Securities.

2.5. Validity; Enforcement. Buyer has the requisite right, power, authority and
capacity to enter into this Agreement and to consummate the transactions
contemplated hereby. This Agreement has been duly and validly authorized,
executed and delivered on behalf of Buyer and, assuming due execution and
delivery hereof by the Company, is a valid and binding agreement of Buyer
enforceable against Buyer in accordance with its terms, subject as to
enforceability to general principles of equity and to applicable bankruptcy,
insolvency, reorganization, moratorium and other similar laws relating to, or
affecting generally, the enforcement of applicable creditors’ rights and
remedies.

2.6. Residency. Buyer, if a natural person, is a resident of that state or
country specified in its address on the signature page.

2.7. Legal, Tax or Investment Advice. Buyer understands that nothing in this
Agreement or any other materials presented to Buyer in connection with the
purchase and sale of the Securities constitutes legal, tax or investment advice.
Buyer has consulted such legal, tax and investment advisors as it, in its sole
discretion, has deemed necessary or appropriate in connection with its purchase
of the Securities.

2.8. No Material Relationships. Buyer represents that, except as set forth
below, (i) it has had no position, office or other material relationship within
the past three years with the Company or persons known to it to be affiliates of
the Company, (ii) it is not a, and it has no direct or indirect affiliation or
association with any, FINRA member or an Associated Person (as such term is
defined under FINRA Membership and Registration Rules Section 1011) as of the
date hereof, and (iii) neither it nor any group of investors (as identified in a
public filing made with the Commission) of which it is a member, acquired, or
obtained the right to acquire, 20% or more of the Common Stock (or securities
convertible or exercisable for Common Stock) or the voting power of the Company
on a post-transaction basis.

Exceptions:

 

 

 

(If no exceptions, write “none.” If left blank, response will be deemed to be
“none.”)

 

3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

The Company represents and warrants to each of the Buyers that:

3.1. Good Standing; Qualification. The Company is duly organized and validly
existing in good standing under the laws of the State of Delaware. Each of the
Company and its subsidiaries (as defined in Rule 405 under the Securities Act of
1933 (the “Securities Act”)) has full power and authority to own, operate and
occupy its properties and to conduct its business as presently conducted and as
described in the documents filed by the Company under the Securities Exchange
Act of 1934 (the “Exchange Act”), since September 30, 2007 through the date
hereof, including, without limitation, its most recent Annual Report on Form
10-K,

 

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subsequent quarterly reports on Form 10-Q and most recent Proxy Statement on
Schedule 14-A, each as filed with the U.S. Securities and Exchange Commission
(the “Exchange Act Documents”) and is registered or qualified to do business and
in good standing in each jurisdiction in which the nature of the business
conducted by it or the location of the properties owned or leased by it requires
such qualification and where the failure to be so qualified would have a
material adverse effect upon the condition (financial or otherwise), earnings,
or business (such business being as described in the Exchange Act Documents),
properties or operations of the Company and its subsidiaries, considered as one
enterprise, or impair the Company’s ability to perform on a timely basis its
obligations under this Agreement (any of the foregoing, a “Material Adverse
Effect”), and no proceeding has been instituted in any such jurisdiction,
revoking, limiting or curtailing, or seeking to revoke, limit or curtail, such
power and authority or qualification.

3.2. Due Authorization and Valid Issuance. The Company has all requisite power
and authority to execute, deliver and perform its obligations hereunder, and
this Agreement has been duly authorized and validly executed and delivered by
the Company and, assuming due execution and delivery hereof by the Buyers, shall
constitute a legal, valid and binding agreement of the Company enforceable
against the Company in accordance with their terms, except as rights to
indemnity and contribution may be limited by state or federal securities laws or
the public policy underlying such laws, except as enforceability may be limited
by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting creditors’ and contracting parties’ rights generally and except as
enforceability may be subject to general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law).
The Shares being purchased by the Buyer hereunder will, upon issuance and
payment therefor pursuant to the terms hereof, be duly authorized, validly
issued, fully-paid and nonassessable. The Warrant Shares will, upon exercise of
the Warrants and the payment of the applicable exercise price pursuant to the
terms thereof, be duly authorized, validly issued, fully-paid and nonassessable.

3.3. Non-Contravention. The execution and delivery of this Agreement, the sale
of the Securities, the fulfillment of the terms of this Agreement and the
consummation of the transactions contemplated hereby will not (A) conflict with
or constitute a violation of, or default (with the passage of time or otherwise)
under, (i) any contract, agreement or other instrument filed or incorporated by
reference as an exhibit to any of the Exchange Act Documents (any such contract,
agreement or instrument, an “Exchange Act Exhibit”), (ii) the charter, by-laws
or other organizational documents of the Company or any subsidiary, or
(iii) assuming the correctness of the representations and warranties of the
Buyers set forth herein, any law, administrative regulation, ordinance or order
of any court or governmental agency, arbitration panel or authority applicable
to the Company or any subsidiary or their respective properties, except in the
case of clauses (i) and (iii) for any such conflicts, violations or defaults
which do not have or would be reasonably likely to result in a Material Adverse
Effect or (B) result in the creation or imposition of any lien, encumbrance,
claim, security interest or restriction whatsoever upon any of the material
properties or assets of the Company or any subsidiary or an acceleration of
indebtedness pursuant to any obligation, agreement or condition contained in any
Exchange Act Exhibit. Assuming the correctness of the representations and
warranties of the Buyers set forth herein, no consent, approval, authorization
or other order of, or registration, qualification or filing with, any regulatory
body, administrative agency, or other governmental body in the United States or
any

 

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other person is required for the execution and delivery of this Agreement and
the valid issuance and sale of the Securities to be sold hereunder, other than
such as have been made or obtained, and except for any post-closing securities
filings or notifications required to be made under federal or state securities
laws.

3.4. Capitalization. The capitalization of the Company as of June 30, 2008 is as
set forth in the Prospectus, increased as set forth in the next sentence. Other
than in the ordinary course of business, the Company has not issued any capital
stock since that date other than pursuant to (i) employee benefit plans
disclosed in the Exchange Act Documents, or (ii) outstanding warrants, options
or other securities disclosed in the Exchange Act Documents. Except as set forth
in the Prospectus, there are no outstanding rights (including, without
limitation, preemptive rights), warrants or options to acquire, or instruments
convertible into or exchangeable for, any unissued shares of capital stock or
other equity interest in the Company or any subsidiary, or any contract,
commitment, agreement, understanding or arrangement of any kind to which the
Company is a party and relating to the issuance or sale of any capital stock of
the Company or any subsidiary, any such convertible or exchangeable securities
or any such rights, warrants or options. Without limiting the foregoing, no
preemptive right, co-sale right, right of first refusal, registration right, or
other similar right exists with respect to the Securities or the issuance and
sale thereof. No further approval or authorization of any shareholder, the Board
of Directors of the Company or others is required for the issuance and sale of
the Securities. Except as disclosed in the Prospectus, there are no shareholder
agreements, voting agreements or other similar agreements with respect to the
voting of the Shares or the Warrant Shares to which the Company is a party or,
to the knowledge of the Company, between or among any of the Company’s
shareholders.

3.5. Legal Proceedings. There is no material legal or governmental proceeding
pending or, to the knowledge of the Company, threatened to which the Company or
any subsidiary is or may be a party or of which the business or property of the
Company or any subsidiary is subject that is not disclosed in the Prospectus.

3.6. No Violations. Neither the Company nor any subsidiary is in violation of
its charter, bylaws, or other organizational document, or in violation of any
law, administrative regulation, ordinance or order of any court or governmental
agency, arbitration panel or authority applicable to the Company or any
subsidiary, which violation, individually or in the aggregate, would be
reasonably likely to have a Material Adverse Effect, or is in default (and there
exists no condition which, with the passage of time or otherwise, would
constitute a default) in any material respect in the performance of Exchange Act
Exhibit, which would have or reasonably likely to result in a Material Adverse
Effect.

3.7. Governmental Permits, Etc. Each of the Company and its subsidiaries has all
necessary franchises, licenses, certificates and other authorizations from any
foreign, federal, state or local government or governmental agency, department,
or body that are currently necessary for the operation of the business of the
Company and its subsidiaries as currently conducted and as described in the
Prospectus, except where the failure to currently possess could not have or
reasonably be expected to result in a Material Adverse Effect.

 

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3.8. Intellectual Property. Except as specifically disclosed in the Prospectus,
(i) each of the Company and its subsidiaries owns or possesses sufficient rights
to use all patents, patent rights, trademarks, copyrights, licenses, inventions,
trade secrets, trade names and know-how (collectively, “Intellectual Property”)
described or referred to in the Prospectus as owned or possessed by it or that
are necessary for the conduct of its business as described in the Prospectus,
except where the failure to currently own or possess would not have or
reasonably be expected to result in a Material Adverse Effect, (ii) to the
knowledge of the Company, neither the Company nor any of its subsidiaries is
infringing any rights of a third party with respect to any Intellectual
Property, (iii) neither the Company nor any of its subsidiaries has received any
notice of, or has any knowledge of, any asserted infringement by the Company or
any of its subsidiaries of, any rights of a third party with respect to any
Intellectual Property that would, individually or in the aggregate, have or
reasonably be expected to result in a Material Adverse Effect if determined
adversely to the Company and (iv) neither the Company nor any of its
subsidiaries has received any notice of, or has any knowledge of, infringement
by a third party with respect to any Intellectual Property rights of the Company
or of any subsidiary that, individually or in the aggregate, would have or
reasonably be expected to result in a Material Adverse Effect.

3.9. Financial Statements. The financial statements of the Company and the
related notes contained in the Prospectus present fairly, in accordance with
generally accepted accounting principles, the financial position of the Company
and its subsidiaries as of the dates indicated, and the results of its
operations and cash flows for the periods therein specified consistent with the
books and records of the Company and its subsidiaries, except that the unaudited
interim financial statements were or are subject to normal and recurring
year-end adjustments which are not expected to be material in amount. Such
financial statements (including the related notes) have been prepared in
accordance with generally accepted accounting principles applied on a consistent
basis throughout the periods therein specified, except as may be disclosed in
the notes to such financial statements, or in the case of unaudited statements,
as may be permitted by the Securities and Exchange Commission (the “SEC”) on
Form 10-Q under the Exchange Act and except as disclosed in the Prospectus.

3.10. No Material Adverse Change. Except as disclosed in the Prospectus, since
June 30, 2008, there has not been (i) any material adverse change in the
financial condition or earnings of the Company and its subsidiaries considered
as one enterprise, (ii) any obligation, direct or contingent, that is material
to the Company and its subsidiaries considered as one enterprise, incurred by
the Company, except obligations incurred in the ordinary course of business,
(iii) any dividend or3 distribution of any kind declared, paid or made on the
capital stock of the Company or any of its subsidiaries, or (iv) any loss or
damage (whether or not insured) to the physical property of the Company or any
of its subsidiaries which has been sustained which has had or reasonably would
be expected to result in a Material Adverse Effect; provided, however, that
changes in the ordinary course of business, including but not limited to the use
of cash and increases in liabilities in the ordinary course of business, shall
not be deemed to be a material adverse change or to have a Material Adverse
Effect.

3.11. Disclosure. The representations and warranties of the Company contained in
this Section 3 as of the date hereof and as of the Closing Date, do not contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading.

 

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3.12. Securities Exchange Compliance. The Common Stock is registered pursuant to
Section 12(b) of the Exchange Act and is accepted for quotation on The NASDAQ
Global Market (the “NASDAQ”), and the Company has taken no action designed to,
or likely to have the effect of, terminating the registration of the Common
Stock under the Exchange Act or de-listing the Shares from the NASDAQ, nor has
the Company received any notification that the SEC or the NASDAQ is
contemplating terminating such registration or listing.

3.13. Reporting Status. The Company has filed in a timely manner all documents
that the Company was required to file under the Exchange Act during the 12
months preceding the date of this Agreement. All such filings complied in all
material respects with the SEC’s requirements as of their respective filing
dates, and the information contained therein as of the date thereof did not
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein in
light of the circumstances under which they were made not misleading.

3.14. Listing. The Company shall comply with all requirements of the NASDAQ with
respect to the issuance of the Shares and the Warrant Shares and the listing
thereof on the NASDAQ. The Company is in compliance with the listing and
maintenance requirements for continued listing of the Common Stock on the
NASDAQ. The issuance and sale of the Securities hereunder does not contravene
the rules and regulations of the NASDAQ and no approval of the shareholders of
the Company is required for the Company to issue and deliver to the Buyers the
maximum number of Shares contemplated by this Agreement and the maximum number
of Warrant Shares contemplated by the Warrants.

3.15. No Manipulation of Stock. The Company has not taken and will not, in
violation of applicable law, take, any action designed to or that might
reasonably be expected to cause or result in stabilization or manipulation of
the price of the Common Stock to facilitate the sale or resale of the Shares or
the Warrant Shares.

3.16. Contracts. Neither the Company nor, to the Company’s knowledge, any other
party to such contracts is in breach of or default under any of such contracts
which would have or reasonably be expected to result in a Material Adverse
Effect.

3.17. Taxes. The Company has filed all necessary federal, state and foreign
income and franchise tax returns and has paid or accrued all taxes shown as due
thereon, and the Company has no knowledge of a tax deficiency which has been or
might be asserted or threatened against it.

3.18. Transfer Taxes. On the Closing Date, all stock transfer or other taxes
(other than income taxes) which are required to be paid in connection with the
sale and transfer of the Securities to be sold to the Buyers hereunder will be,
or will have been, fully paid or provided for by the Company and all laws
imposing such taxes will be or will have been fully complied with.

 

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3.19. Disclosure Controls and Procedures; Internal Controls. The Company has
established disclosure controls and procedures (as defined in Exchange Act Rules
13a-14 and 15d-14) for the Company and designed such disclosure controls and
procedures to ensure that material information relating to the Company,
including its subsidiaries, is made known to the certifying officers by others
within those entities, particularly during the period in which the Form 10-K or
Form 10-Q, as the case may be, is being prepared. The Company’s certifying
officers have evaluated the effectiveness of the Company’s disclosure controls
and procedures as of the end of the periods covered by such reports (such date,
the “Evaluation Date”). The Company presented in the Form 10-Q for the quarter
ended June 30, 2008 the conclusions of the certifying officers about the
effectiveness of the disclosure controls and procedures based on their
evaluations as of the Evaluation Date. Since the Evaluation Date, there have
been no significant changes in the Company’s internal controls (as such term is
used in Item 307(b) of Regulation S-K under the Exchange Act) or, to the
Company’s knowledge, in other factors that could significantly affect the
Company’s internal controls.

3.20. No Additional Agreements. The Company does not have any agreement or
understanding with any Buyer with respect to the transactions contemplated by
this Agreement other than as specified in this Agreement.

3.21. Investment Company. The Company is not, and is not an Affiliate of, an
“investment company” within the meaning of the Investment Company Act of 1940,
as amended.

3.22. Compliance. Neither the Company nor any subsidiary (i) is in default under
or in violation of (and no event has occurred that has not been waived that,
with notice or lapse of time or both, would result in a default by the Company
or any subsidiary under), nor has the Company or any subsidiary received notice
of a claim that it is in default under or that it is in violation of, any
indenture, loan or credit agreement or any other agreement or instrument to
which it is a party or by which it or any of its properties is bound (whether or
not such default or violation has been waived), (ii) is in violation of any
order of any court, arbitrator or governmental body, or (iii) is or has been in
violation of any statute, rule or regulation of any governmental authority,
including without limitation all foreign, federal, state and local laws relating
to taxes, environmental protection, occupational health and safety, product
quality and safety and employment and labor matters, except in each case as
would not, individually or in the aggregate, have or reasonably be expected to
result in a Material Adverse Effect.

3.23. Registration Statement Effective. The Registration Statement has been
declared effective and no stop orders have been issued with respect to the
Company or the Registration Statement.

 

4. COVENANTS.

4.1. Commercially Reasonable Efforts. Each party shall use commercially
reasonable efforts to timely satisfy each of the conditions to be satisfied by
it as provided in Sections 5 and 6 of this Agreement.

 

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4.2. Listing. The Company shall, on or before the Closing Date, take such
actions necessary, if any, to secure the listing of the Shares and Warrant
Shares on the NASDAQ and shall use commercially reasonable efforts to maintain
the listing of the Common Stock on the NASDAQ or other national securities
exchange or quotation service.

4.3. Maintenance of Registration Statement Effectives. The Company shall, for a
period of at least one year from the Closing Date, use commercially reasonable
efforts to maintain the effectiveness of the Registration Statement.

4.4. Resale of Warrant Shares. If all or any portion of a Warrant is exercised
at a time when there is an effective registration statement to cover the
issuance or resale of the Warrant Shares, such Warrant Shares shall be issued
free of all legends.

4.5. Reservation of Warrant Shares. As of the date hereof, the Company has
reserved and the Company shall continue to reserve and keep available at all
times, free of preemptive rights, a sufficient number of shares of common stock
for the purpose of enabling the Company to issue the Warrant Shares pursuant to
any exercise of the Warrants.

 

5. CONDITIONS TO THE COMPANY’S OBLIGATION TO SELL.

The obligation of the Company hereunder to issue and sell the Securities to each
Buyer at the Closing is subject to the satisfaction, at or before the Closing
Date, of each of the following conditions, provided that these conditions are
for the Company’s sole benefit and may be waived by the Company at any time in
its sole discretion by providing each Buyer with prior written notice thereof:

5.1. Each Buyer shall have delivered to the Company the Purchase Price for the
Securities being purchased by each Buyer at the Closing by wire transfer of
immediately available funds pursuant to the wire instructions provided by the
Company.

5.2. The representations and warranties of each Buyer shall be true and correct
in all material respects (except to the extent that any of such representations
and warranties is already qualified as to materiality in Section 2 above, in
which case, such representations and warranties shall be true and correct
without further qualification) as of the date when made and as of the Closing
Date, as though made at that time (except for representations and warranties
that speak as of a specific date), and each Buyer shall have performed,
satisfied and complied in all material respects with the covenants, agreements
and conditions required by this Agreement to be performed, satisfied or complied
with by such Buyer at or prior to the Closing Date.

5.3. The Company shall have received the approval for the listing of the Shares
and Warrant Shares on the NASDAQ, as provided in Section 4.2.

 

6. CONDITIONS TO EACH BUYER’S OBLIGATION TO PURCHASE.

The obligation of each Buyer hereunder to purchase the Securities at the Closing
is subject to the satisfaction, at or before the Closing Date of each of the
following conditions, provided that these conditions are for each Buyer’s sole
benefit and may be waived by such Buyer at any time in its sole discretion by
providing the Company with prior written notice thereof:

6.1. The Company shall have executed this Agreement and delivered same to such
Buyer.

 

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6.2. The NASDAQ shall not have suspended trading in the Common Stock.

6.3. The representations and warranties of the Company shall be true and correct
in all material respects (except to the extent that any of such representations
and warranties is already qualified as to materiality in Section 3 above, in
which case, such representations and warranties shall be true and correct
without further qualification) as of the date when made and as of the Closing
Date as though made at that time (except for representations and warranties that
speak as of a specific date) and the Company shall have performed, satisfied and
complied in all material respects with the covenants, agreements and conditions
required by this Agreement to be performed, satisfied or complied with by the
Company at or prior to the Closing Date.

6.4. The Company shall have made all filings under all applicable federal and
state securities laws necessary, if any, to consummate the issuance of the
Securities pursuant to this Agreement in compliance with such laws and no
stop-order shall have been issued by the SEC with respect to the Registration
Statement.

6.5. The Buyer shall have received a customary opinion from the Company’s legal
counsel to the effect that the Company is duly incorporated and in good
standing, that the Securities have been duly authorized and validly issued, that
the Shares and Warrant Shares will be, when issued and paid for in accordance
with the terms of this Agreement and the Warrants, fully paid and
non-assessable, that this Agreement has been validly executed and delivered by
the Company.

 

7. GOVERNING LAW; MISCELLANEOUS.

7.1. Governing Law; Jurisdiction; Jury Trial. All questions concerning the
construction, validity, enforcement and interpretation of this Agreement shall
be governed by and construed and enforced in accordance with the internal laws
of the State of New York, without regard to the principles of conflicts of law
thereof. Each party hereto hereby irrevocably waives personal service of process
and consents to process being served in any suit, action or proceeding arising
under or relating to this Agreement (a “Proceeding”) by mailing a copy thereof
via registered or certified mail or overnight delivery (with evidence of
delivery) to such party at the address in effect for notices to it under this
Agreement and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained herein shall be deemed
to limit in any way any right to serve process in any manner permitted by law.
If either party shall commence a Proceeding to enforce any provisions of this
Agreement, then the prevailing party in such Proceeding shall be reimbursed by
the other party for its reasonable attorney’s fees and other costs and expenses
incurred with the investigation, preparation and prosecution of such Proceeding.
Each party agrees that all Proceedings concerning the interpretations,
enforcement and defense of the transactions contemplated by this Agreement
(whether brought against a party hereto or its respective affiliates, employees
or agents) shall be commenced exclusively in the state and federal courts
sitting in New York, New York (the “Courts”). Each party hereto hereby
irrevocably submits to the exclusive jurisdiction

 

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of the Courts for the adjudication of any dispute hereunder or in connection
herewith or with any transaction contemplated hereby or discussed herein, and
hereby irrevocably waives, and agrees not to assert in any Proceeding, any claim
that it is not personally subject to the jurisdiction of any such Court, or that
such Proceeding has been commenced in an improper or inconvenient forum.

7.2. Counterparts. This Agreement may be executed in two or more identical
counterparts, all of which shall be considered one and the same agreement and
shall become effective when counterparts have been signed by each party and
delivered to the other parties; provided that a facsimile signature shall be
considered due execution and shall be binding upon the signatory thereto with
the same force and effect as if the signature were an original, not a facsimile
signature.

7.3. Headings. The headings of this Agreement are for convenience of reference
and shall not form part of, or affect the interpretation of, this Agreement.

7.4. Severability. If any provision of this Agreement shall be invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability shall not
affect the validity or enforceability of the remainder of this Agreement in that
jurisdiction or the validity or enforceability of any provision of this
Agreement in any other jurisdiction.

7.5. Entire Agreement; Amendments. This Agreement (including the exhibits
hereto) supersedes all other prior oral or written agreements between the
Buyers, the Company, their affiliates and persons acting on their behalf with
respect to the matters discussed herein, and this Agreement and the agreements
and instruments referenced herein, contain the entire understanding of the
parties with respect to the matters covered herein. No provision of this
Agreement may be amended other than by an instrument in writing signed by the
Company and the Buyers holding or, prior to Closing, having the right to
purchase, at least a majority of the Shares, and no provision hereof may be
waived other than by an instrument in writing signed by the party against whom
enforcement is sought.

7.6. Notices. Any notices, consents, waivers or other communications required or
permitted to be given under the terms of this Agreement must be in writing and
will be deemed to have been delivered: (i) upon receipt, when delivered
personally; (ii) when sent by facsimile (provided confirmation of transmission
is mechanically or electronically generated and kept on file by the sending
party); or (iii) one business day after deposit with a nationally recognized
overnight delivery service, in each case properly addressed to the party to
receive the same. The addresses and facsimile numbers for such communications
shall be:

If to the Company:

Arrowhead Research Corporation

201 South Lake Avenue

Suite 703

Pasadena, California 91101

Attention: Chief Executive Officer

Facsimile No.: 626-304-3401

 

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If to a Buyer: at the address and facsimile number set forth on the signature
page attached hereto, with copies to such Buyer’s representatives, if any,
specified on the signature page,

or at such other address and/or facsimile number and/or to the attention of such
other person as the recipient party has specified by written notice given to
each other party in accordance with the above provisions five (5) days prior to
the effectiveness of such change.

7.7. Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties and their respective successors and assigns,
including any purchasers of the Securities. A Buyer may not assign this
Agreement or any rights or obligations hereunder without the prior written
consent of the Company, except for assignments to affiliates of Buyer or to
other Buyers.

7.8. No Third-Party Beneficiaries. This Agreement is intended for the benefit of
the parties hereto and their respective permitted successors and assigns, and is
not for the benefit of, nor may any provision hereof be enforced by, any other
person.

7.9. Publicity. The Company and each Buyer shall have the right to approve
before issuance any press releases or any other public statements with respect
to the transactions contemplated hereby; provided, however, that the Company
shall be entitled, without the prior approval of any Buyer, to make any press
release or other public disclosure with respect to such transactions as is
required by applicable law and regulations.

7.10. Further Assurances. Each party shall do and perform, or cause to be done
and performed, all such further acts and things, and shall execute and deliver
all such other agreements, certificates, instruments and documents, as the other
party may reasonably request in order to carry out the intent and accomplish the
purposes of this Agreement and the consummation of the transactions contemplated
hereby.

7.11. Termination. In the event that the Closing shall not have occurred with
respect to a Buyer within ten business days from the date of this Agreement due
to the Company’s or such Buyer’s failure to satisfy the conditions set forth in
Sections 6 and 7 above (and the non-breaching party’s failure to waive such
unsatisfied condition(s)), the non-breaching party shall have the option to
terminate this Agreement with respect to such breaching party at the close of
business on such date without liability of any party to any other party.

7.12. Remedies. Each Buyer and each holder of the Securities shall have all
rights and remedies set forth in this Agreement and all of the rights that such
holders have under any law. Any person having any rights under any provision of
this Agreement shall be entitled to enforce such rights specifically (without
posting a bond or other security), to recover damages by reason of any breach of
any provision of this Agreement and to exercise all other rights granted by law.

7.13. Obligations of Buyers Several and Not Joint. The obligations of each Buyer
hereunder are several and not joint with the obligations of any other Buyer, and
no Buyer shall be responsible in any way for the performance of the obligations
of any other Buyer under any Agreement. Nothing contained herein, and no action
taken by any Buyer hereto, shall be

 

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deemed to constitute the Buyers as a partnership, an association, a joint
venture or any other kind of entity, or create a presumption that the Buyers are
in any way acting in concert or as a group with respect to such obligations or
the transactions contemplated hereby, provided that such obligations or the
transactions contemplated hereby may be modified, amended or waived in
accordance with Section 7.5 of this Agreement. Each Buyer shall be entitled to
independently protect and enforce its rights, including without limitation the
rights arising out of this Agreement (provided, that such rights may be
modified, amended or waived in accordance with Section 7.5), and it shall not be
necessary for any other Buyer to be joined as an additional party in any
proceeding for such purpose.

*        *        *

 

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SIGNATURE PAGE

(All information must be completed)

I HEREBY REPRESENT THAT I HAVE READ AND UNDERSTOOD THE SUBSCRIPTION AGREEMENT
FOR ARROWHEAD RESEARCH CORPORATION.

Subscription: I hereby subscribe for the following number of Units at the
Purchase Price indicated:

 

                Number of Units     Price per Unit     Total Purchase Price  

 

   Subscriber (Print exact name to appear on the stock and warrant certificates)
  Tax ID

 

          Contact Name     Telephone           Address of Record     Alternative
Telephone           City, State, Zip Code     Fax           Country     e-mail
address

Date:                                                  

 

   Signature of Subscriber  

Signature of proposed Joint Owner

(if any)

[SIGNATURE PAGE TO SECURITIES PURCHASE AGREEMENT]

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ACCEPTANCE OF SUBSCRIPTION

Agreed and Accepted this day of      of              2008.

 

COMPANY: ARROWHEAD RESEARCH CORPORATION By:     Name:     Title:    

Sales of the Securities purchased hereunder were made pursuant to a Registration
Statement(s) or in a transaction in which a final prospectus would have been
required to have been delivered in the absence of Rule 172 promulgated under the
Securities Act.

[COMPANY ACCEPTANCE OF SUBSCRIPTION]