The Investment Syndicate (TIS)


 


 













 


23rd April 2014


 


Mr. Andrew L. Tussing


President and Chief Operation Officer and
Vaccinogen Board of Directors


5300 Westview Drive, Suite 406


Frederick, MD 21703, USA


 


Re: Definitive Conditions to Closing


  


 


Dear Mr. Tussing and Vaccinogen’s
Board of Directors:


 


We at TIS are grateful to Mr. Tussing for
his cooperation with our due diligence on Vaccinogen. With critical mass of funds in place we can now follow through with the Vaccinogen
investment. Based on recent due diligence, this binding document is serving to state the final terms for investment.


 


Article 1. Investment Structure


 


The total investment of $80 million US
dollars will take place in the following steps:


 


1st Closing – Within twenty
one (21) business days of Vaccinogen’s authorized execution of this document, TIS will make sure an investment will be delivered
of $10 million out of the amount that will be available in the series C round using the Series C investment subscription documents.
Vaccinogen agrees to immediately pay off existing undisputed past due payables, initiate Article 4 and implement Articles 2, 3
and 5.


 


2nd Closing – Within another
twenty one (21) business days after 1st Closing TIS will make sure an investment will be ready taking the remaining
available amount in the series C (up to $10 million) using the Series C investment subscription documents. Upon the completion
of proper legal investment documents for investments subsequent to the Series C, prepared by Vaccinogen’s counsel and approved
by TIS, this 2nd Closing can first happen.


 


3rd Closing - $20 million investment
at $5.50/share of common stock to take place when the first patient has been given the first three doses of OncoVAX, with positive
result, in the next phase IIIb clinical trial.


 


4th Closing - $20 million investment
at $5.50/share of common stock to take place when the new corporate structure has been implemented as outlined in Article 6.


 


5th Closing - $20 million investment
at $5.50/share of common stock to take place upon successful up-list to either NYSE or NASDAQ. Article 3 takes effect upon this
closing.


 


We reserve the option that expires six months after the first
closing to invest up to an additional $30 million under the same terms.


 





 





 









The Investment Syndicate


C/o Malchor AB


Sollentunavägen 80


SE-191 40 Sollentuna,
Sweden 















    	 



    	 



    




 





The Investment Syndicate (TIS)


 





 






Article 2. Management


 


We are very impressed with Dr. Hanna’s
outstanding accomplishments and his superior role in his great effort to develop and preserve OncoVAX through to this time. Mr.
Tussing helped us appreciate that, without Dr. Hanna there never would have been an OncoVAX or Vaccinogen. Understanding this background
and his consideration of potentially retiring in the near future, we require an updated employment agreement for Dr. Hanna that
shows a respectful transition to Chairman Emeritus, Medical Advisory Board Member and Special Advisor to the CEO. For continuing
of the knowledge, it is important that Dr. Hanna agrees to completely transport his knowledge to those who would join the company
in the research and development areas and advises with the advancement of opportunities for OncoVAX and the promising human antibody
field. These arrangements for Dr. Hanna must be handled with the utmost respect and recognition he deserves and that he has a new
enriching role of again being an explorer of new paths in the human monoclonal antibody effort.


 


After working closely with Mr. Tussing
over the last months and independently investigating his accomplishments, reputation, ethics, impressive knowledge of your business
and science, we have strong confidence in him as a company leader and at this time of important transformation. We therefore urge
that Mr. Tussing to be appointed CEO/President and a member of the board of directors effective upon the 1st closing and be given
full authority to operate and build the business. An updated 3-year employment agreement consistent for this role must be created
for Mr. Tussing and reviewed/approved by the soon to be formed compensation committee. As of the date of this letter and until
after the 1st closing, we insist that no new binding agreement or the hiring of new employees can take place without
our knowledge and approval.


 


Article 3. Intracel License Agreements
and Letter of Intent


 


Our due diligence discovered three important
documents:


 


		1.	2007 License Agreement between Intracel and Vaccinogen



 


		2.	2010 Amendment to the 2007 License Agreement



 


		3.	December 2010 “Letter of Intent” by Intracel as it affects the 2010 Amendment



  


Our analysis of the documents followed
how Intracel moved from 10% of Vaccinogen stock in 2007 to 50% in 2010 in exchange for its transfer of the OncoVAX assets. To our
surprise and discontent, we also discovered an everlasting and more expanded license agreement amendment that still remains in
place. It is our strong view and those of experts that this license agreement and amendment as it is written is unusual for this
situation. We also conclude that it will have a severe and unfavorable impact on the company’s value and hold back the stock
price from reaching its full potential. We further conclude that these license documents are self-defeating and will certainly
create opposing agendas among the shareholders. All the shareholders’ interests must become aligned and this impediment to
maximum investment return potential be removed.


 


 


 









The Investment Syndicate


C/o Malchor AB


Sollentunavägen 80


SE-191 40 Sollentuna, Sweden







 






    	 



    	 



    

 





The Investment Syndicate (TIS)


 


 













We require a termination agreement be executed between Intracel
and Vaccinogen before the first closing that results in a complete elimination of any such license agreement with Intracel to automatically
take effect upon the deposit of all $80 million and without further financial or equity consideration to Intracel.


 


Article 4. Board Constitution


 


We require that the nominating committee
appoint a new chairman and that in-person physical quarterly board meetings be properly planned, scheduled and held. Upon 1st
closing, Dr. Benjamin S. Carson, assuming he is willing, will become Chairman in a transitional capacity until the nominating committee
is formed and the nominating process produces a replacement Chairman. If Dr. Carson is unwilling or unable to be the Chairman,
Mr. Halldin will serve that role as a backup. Also upon 1st closing, Mr. Halldin will serve as Nominating Committee
Chairman and initiate the nominating process for board reconstitution.


 


As Vaccinogen transforms with our capital
investment, it is important that a future Vaccinogen board be comprised of most distinguished health care industry/business leaders
possible that can attract many institutional investors. As of the date of this letter and until after the 1st closing,
we insist that no new board or committee appointments be made without our approval.


 


Board re-constitution needs to take place
in the following manner with a maximum total of seven directors:


 


Upon 1st Closing


 


		1.	Mr. Nicolis (representing new investors since 2007)



 


		2.	A TIS nominee (as vice chairman and chair of nominating committee)



 


		3.	An Intracel nominee (representing pre-Vaccinogen investors)



 


		4.	A 2nd Intracel nominee



 


		5.	Mr. Tussing



 


		6.	Dr. Hanna (chairman emeritus, director)



 


		7.	Dr. Carson (as Chairman, if willing)



  


Upon 2nd Closing


 


		1.	Mr. Nicolis



 





 



 The Investment Syndicate


C/o Malchor AB


Sollentunavägen 80


SE-191 40 Sollentuna, Sweden







 






    	 



    	 



    

 





The Investment Syndicate (TIS)


 


 












		2.	A TIS nominee



 


		3.	An Intracel nominee



 


		4.	Mr. Tussing



 


		5.	Dr. Hanna



 


		6.	Dr. Carson



 


 Between
the 1st and 2nd closing


 


The TIS nominee will begin forming the
nominating committee of independent directors and will lead the effort to identify, interview, evaluate and recommend for appointment
of additional independent directors, potential board chairman and committee chairman candidates. The board would activate the compensation
committee and appoint one of these new independent directors as chairman of it. The board would appoint additional independent
directors to the audit committee.


 


Prior to the 5th Closing


 


		1.	Mr. Nicolis



 


		2.	A TIS nominee



 


		3.	An Intracel nominee



 


		4.	Mr. Tussing



 


		5.	Dr. Carson



 


		6.	A new independent director



 


		7.	A 2nd new independent director (Dr. Hanna retires from the board but maintains chairman
emeritus status upon appointment of 2nd independent director)



  


Also well in time for 5th Closing,
the board must establish term-limit guidelines for directors and be in keeping with best practices for a US public company. When
Intracel’s holdings are distributed among its own shareholders, the Intracel nominee will resign to open up the board position
for another independent director.


 


Article 5. Abell Foundation $5 Million
Equity Investment


 


We understand that Abell Foundation had
originally committed to invest $5 million when Vaccinogen raises at least $35 million. We require that an updated agreement be
executed between Vaccinogen and The Abell Foundation clarifying Abell’s commitment to invest at $5.50 per share before the
3rd closing or surrender its investment option.


  


 



The Investment Syndicate


C/o Malchor AB


Sollentunavägen 80


SE-191 40 Sollentuna, Sweden 


 






    	 



    	 



    

 


The Investment Syndicate (TIS)


 


 











Article 6. Implementation of a new
Corporate Structure


 


We understand that the existing corporate
set up is not as efficient as possible. We require this to be taken care of urgently so a new set up can be implementedbefore the
4th closing.


 


Article 7. Ongoing Public Listing
and Capitalization Efforts


 


We are supportive of Vaccinogen’s
goal to do a carefully planned transition to a national exchange like NASDAQ or NYSE. We encourage committing adequate resources
towards investor relations and public relations activities to build and support investor interest in the Vaccinogen stock while
steps toward big accomplishments are started. We only support the idea of engaging a large investment bank to manage a proper follow-on
underwriting to be considered after the 5th closing. Lastly, we encourage pursuing revenue opportunities at the earliest
possible moment through speedy completion of the phase IIIb trial, opening up other markets and the human monoclonal antibodies
effort.


 


______________________________________


 


  


On behalf of TIS, this binding commitment to invest, which expires
in five business days from the delivery of this letter unless countersigned by Vaccinogen, under the above stated definitive conditions
to closing, is authorized by:


 


 





	/s/ Anders Halldin	 	April 23, 2014	 
	 	 	 	 
	Anders Halldin, TIS leader	 	Date	 










 


On behalf of Vaccinogen, Inc. as authorized
by its board we accept the above stated binding definitive conditions to closing:


 





	/s/ Andrew L. Tussing	 	April 24, 2014	 
	 	 	 	 
	Andrew L. Tussing, President 	 	Date 	 







 


 


 



The Investment Syndicate


C/o Malchor AB


Sollentunavägen 80


SE-191 40 Sollentuna, Sweden