Document:

Amendment dated as of January 1, 2010 to Employment Agreement (Thomas O. Staggs)

 Exhibit 10.2 
 Amendment and Assignment 
 of 
 Amended and Restated Employment Agreement 
 between 
 The Walt Disney Company and Thomas O. Staggs 
 AMENDMENT AND ASSIGNMENT of that certain Amended and Restated Employment Agreement by and between The Walt Disney Company (“Disney”) and
Thomas O. Staggs (“Executive”), dated as of December 18, 2008 (the “Agreement”). 
 WHEREAS, Disney and Executive have mutually agreed that effective January 1, 2010, Executive shall assume the position of Chairman, Walt Disney Parks and Resorts Worldwide, and at such time relinquish his position as Senior Executive
Vice President and Chief Financial Officer of Disney; and 
 WHEREAS, Disney and Executive desire to amend the Agreement to
reflect such change in Executive’s position and to make certain other modifications to the Agreement related to such change and further desire to assign the Agreement to Walt Disney Parks and Resorts Worldwide, an indirectly wholly owned
subsidiary of Disney; 
 NOW, THEREFORE, in consideration of the mutual covenants herein contained, Disney and Executive hereby
agree as follows: 
 I. Amendment of the Agreement. The following amendments to the agreement are hereby agreed to by the Company
and Executive, in each case effective as of January 1, 2010: 
 1. The meaning of the term “Company” is hereby
amended throughout the Agreement to mean Walt Disney Parks and Resorts Worldwide. 
 2. Paragraph 2 of the Agreement is
hereby amended to read in its entirety as follows: 
 2. Position and Duties. During the Employment
Period, Executive shall serve as Chairman, Walt Disney Parks and Resorts Worldwide. In such capacity, Executive shall report, at the election of Disney as exercised by it from time to time, solely and directly either (i) to the Chief Executive
Officer of Disney, (ii) to either of the President or Chief Operating Officer of Disney, if such officer shall at any time not also be the Chief Executive Officer of Disney, or (iii) to any other position at Disney more senior than
President or Chief Operating Officer of Disney;

 
provided, however, that Executive shall not at any time be required to report to any person pursuant to either clause (ii) or clause (iii) above unless such person shall report directly
to the Chief Executive Officer of Disney. During the Employment Period, Executive shall devote substantially all his business time to the services required of him hereunder in his position as Chairman, Walt Disney Parks & Resorts Worldwide,
or such other positions with the Company or its affiliates within the Parks and Resorts segment, consistent with his position as Chairman, Walt Disney Parks and Resorts Worldwide, as the Company shall reasonably assign to Executive from time to
time, and Executive shall perform such services in a manner consonant with the duties of his position. Executive shall be subject to the terms and conditions of any applicable policy of Disney or the Company regarding service (including as a
director) on behalf of any other organization, provided that, subject to the provisions of Paragraph 8(a), nothing herein shall preclude Executive from (i) engaging in charitable activities and community affairs, and
(ii) managing his personal investments and affairs, so long as the activities listed in subclauses (i)-(ii) do not materially interfere, individually or in the aggregate, with the proper performance of his duties and
responsibilities as Chairman, Walt Disney Parks and Resorts Worldwide. 
 3. Paragraphs 3(b) and 3(c) of the Agreement are
hereby amended to read in their entirety as follows: 
 (b) Incentive Compensation. Executive shall be
given the opportunity to earn an annual incentive bonus in accordance with the annual bonus plan as then generally applicable, for fiscal 2010, to Disney’s executive officers, and, for fiscal 2011 and thereafter, to the most senior executives
of the subsidiaries of Disney (such subsidiaries being the “Disney Group”) who have levels of responsibility comparable to Executive’s (the “Annual Plan”). Executive’s target annual incentive
bonus opportunity under the Annual Plan during each fiscal year during the term hereof shall be no less than twice Executive’s Base Salary as expected to be in effect at the end of such fiscal year, as determined in accordance with the schedule
established under Paragraph 3(a). The actual amount payable to Executive as an annual bonus under the Annual Plan shall be dependent upon the achievement of performance objectives established in accordance with the Annual Plan by the Board or the
committee of the Board responsible for administering such Annual Plan (the “Compensation Committee”). The preceding sentence shall not limit any power or discretion of the Board or the Committee in the
administration of the Annual Plan. Accordingly,

  

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depending on performance, the actual amount payable as an annual bonus to Executive under the Annual Plan may be less than, greater than or equal to the target bonus specified above. Any bonus
payable pursuant to this Paragraph 3(b) shall be paid at the same time as annual bonuses are payable, for fiscal 2010, to Disney’s executive officers, and, for fiscal 2011 and thereafter, to the most senior executives of the Disney Group in
accordance with the provisions of the Annual Plan, subject to Executive’s continued employment with the Company or an affiliate thereof through the date on which such bonuses are paid. 
 (c) Eligibility for Equity Awards. Subject to the terms of this Agreement, Executive shall be entitled to participate
in any stock option, performance share, performance unit or other equity based long-term incentive compensation plan, program or arrangement generally made available to the most senior executives of the Disney Group with levels of responsibility
comparable to Executive’s, on substantially the same terms and conditions as generally apply to such other executives, except that the size of the awards made to Executive shall reflect Executive’s position with the Company and the
Compensation Committee’s evaluation of Executive’s performance and competitive compensation practices. During each fiscal year during the term hereof, Executive shall receive an annual award with a target award value (which value shall be
as determined in accordance with the policies and practices generally applicable to other senior executives of the Disney Group with levels of responsibility comparable to Executive’s) of not less than three times Executive’s Base Salary
as expected to be in effect at the end of such fiscal year, as determined in accordance with the schedule established under Paragraph 3(a); it being understood that the form of the award shall be determined by the Compensation Committee and such
form shall be subject to the terms of the applicable plan or plans of Disney. The preceding sentence shall not limit any power or discretion of the Board or the Committee in the administration of any such long-term incentive plan. The Compensation
Committee may increase the award value of any award made in respect of any such fiscal year based on its evaluation of Executive’s performance. The actual benefits conveyed to Executive in respect of any such awards may be less than, greater
than or equal to the targeted award value, as such benefits will be dependent on a series of performance and other factors, such as the value of Disney’s common stock and satisfaction of any applicable vesting requirements and performance
conditions. 
 4. Paragraphs 4(a) and 4(b) of the Agreement are hereby amended to read in their entirety as follows:

  

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 (a) Benefits. During the Employment Period, Executive shall be
eligible to participate in (i) each welfare benefit plan sponsored or maintained by Disney and made available generally to its senior officers , including, without limitation, each group life, hospitalization, medical, dental, health,
accident or disability insurance or similar plan or program of Disney, and (ii) each pension, profit sharing, retirement, deferred compensation or savings plan sponsored or maintained by Disney for its senior officers, whether now
existing or established hereafter, in accordance with the generally applicable provisions thereof, in each case to the extent that would have been applicable to Executive had his position as Senior Executive Vice President and Chief Financial
Officer of Disney continued throughout the Employment Period, and in each case, subject to compliance with applicable ERISA rules or regulations and federal, state or local law and the requirements for eligibility for tax-qualified status of any
plan or program of Disney (being understood that if any such benefit or plan of Disney cannot at any time be provided to Executive in accordance with the foregoing, then the benefit or plan of the Company most comparable thereto will be provided to
him). 
 (b) Perquisites. During the Employment Period, Executive shall be entitled to receive such
perquisites as are generally provided to the most senior executives of the Disney Group with levels of responsibility comparable to Executive’s in accordance with the then current policies and practices of Disney and/or the Company. 

5. Paragraphs 5(b)(i) and 5(b)(iii) of the Agreement are hereby amended to read in their entirety as follows: 
 (i) In the event of Executive’s death during the Employment Period or a Termination due to Disability, Executive or his
beneficiaries or legal representatives shall be provided the Unconditional Entitlements, including, but not limited to, any such Unconditional Entitlements that are or become payable under any Disney or Company plan, policy, practice or program or
any contract or agreement with Disney or the Company by reason of Executive’s death or Termination due to Disability. 
 (iii) In the event of a Termination for Good Reason or the exercise by the Company of its Termination Right, Executive shall be provided the Unconditional Entitlements and Disney and/or the Company shall
provide Executive the Conditional Benefits, subject to (A) Executive’s execution of the Release, (B) Executive having not revoked such Release

  

 4 

 
within the seven-day revocation period permitted following delivery of such Release and (C) Executive’s execution of the Consulting Agreement. For Executive to become entitled to
the Conditional Benefits, Executive must deliver both the executed Release and the executed Consulting Agreement to the Company by no later than twenty-two (22) days following the Termination Date. 
 6. Paragraphs 5(c)(ii), 5(c)(iv), and 5(c)(vi) of the Agreement are hereby amended to read in their entirety as follows: 
 (ii) Benefits. All benefits payable to Executive under any employee benefit plans (including, without limitation any
pension plans or 401(k) plans) of Disney or the Company or any of their affiliates applicable to Executive at the time of termination of Executive’s employment with the Company and all amounts and benefits (other than the Conditional Benefits)
which are vested or which Executive is otherwise entitled to receive under the terms of or in accordance with any plan, policy, practice or program of, or any contract or agreement with, Disney or the Company, at or subsequent to the date of his
termination without regard to the performance by Executive of further services or the resolution of a contingency, shall be paid or provided in accordance with and subject to the terms and provisions of such plans, it being understood that all such
benefits shall be determined on the basis of the actual date of termination of Executive’s employment with the Company. Notwithstanding the immediately preceding sentence, Executive shall not be entitled to any benefits under any severance plan
or policy of Disney, the Company, or any of their affiliates. 
 (iv) Medical Coverage. Executive shall be
entitled to such continuation of health care coverage as is required under, and in accordance with, applicable law or otherwise provided in accordance with Disney’s or the Company’s policies. Executive shall be notified in writing of his
rights to continue such coverage after the termination of his employment pursuant to this Paragraph 5(c)(iv), provided that Executive timely complies with the conditions to continue such coverage. Executive understands and acknowledges that
Executive is responsible to make for all payments required for any such continued health care coverage that Executive may choose to receive. 
 (vi) Stock Options/RSUs. Except to the extent additional rights are provided upon Executive’s qualifying to receive the Conditional Benefits, Executive’s rights with respect to any stock
options and/or restricted stock units granted to him by Disney shall be governed by the

  

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terms and provisions of the plans (including plan rules) and award agreements pursuant to which such stock options and restricted stock units were awarded, as in effect at the date
Executive’s employment terminates. 
 7. The last sentence of Paragraph 5(d)(ii) of the Agreement is hereby amended to
read in its entirety as follows: 
 However, any provisions in the Original Stock Option Award Documents relating to disability
or change in control of Disney shall not be operative after the Termination Date with respect to any Remaining Stock Options. 
 8. Paragraphs 5(d)(iii)(B) and 5(d)(iii)(D) of the Agreement are hereby amended to read in their entirety as follows: 
 (B) for so long as this Agreement shall be in effect (that is, regardless of whether the Termination Right has been exercised or a Termination for Good Reason shall have occurred), any terms in any of the
Original RSU Award Documents relating to a change in control of the Company shall not be operative unless the event that constitutes a change in control of Disney also constitutes a “change in control event” with respect to Disney within
the meaning of Section 409A; 
 (D) to the extent that, under Disney’s compensation practices and
policies, any tranche of Remaining Stock Units is subject to the achievement of performance conditions which were imposed solely because Executive was an executive officer of Disney who could have been a covered employee within the meaning of
Section 162(m) at the time payment in respect of such award was expected to be made (the “Applicable 162(m) Criteria”) and such Applicable 162(m) Criteria relate, in whole or in part, to any performance period continuing
after the end of Disney’s fiscal year in which the Termination Date occurs, such Applicable 162(m) Criteria shall be waived as of the Termination Date with respect to such tranche of the Remaining Stock Units; provided, however, that this
Paragraph 5(d)(iii)(D) shall not be applicable if and to the extent, in the reasonable opinion of tax counsel to Disney, the presence of such provision would cause any stock units intended to be qualified as other performance based compensation
within the meaning of Section 162(m) of the Code to fail to be so qualified at any time prior to Executive’s Termination Date. 
 9. The subparagraphs titled, “Continuing Unvested Options,” “Remaining Stock Units,” and “Termination for Good Reason” under Paragraph 5(e) of the Agreement are hereby
amended to read in their entirety as follows: 
  

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 “Continuing Unvested Options” means any of
Executive’s stock options that were not vested and exercisable at the Termination Date, but that would have become vested and exercisable on or prior to the Latest Stock Option Vesting Date had Executive continued to be employed by Disney or
the Company or an affiliate thereof through the Scheduled Expiration Date. 
 “Remaining Stock
Units” means any of Executive’s restricted stock units (including, but not limited to, the 250,000 restricted stock units granted on January 30, 2008) outstanding at the Termination Date (whether or not subject to
performance conditions) that, subject to the satisfaction of any applicable performance conditions, would have become vested on or prior to the Scheduled Expiration Date had Executive continued to be employed by Disney or an affiliate thereof
through the Scheduled Expiration Date. 
 “Termination for Good Reason” means a termination of
Executive’s employment by Executive within 30 days of the Company’s failure to cure, in accordance with the procedures set forth below, any of the following events: (i) a reduction in any of Executive’s compensation rights
hereunder (that is, Base Salary, target bonus opportunity specified in Paragraph 3(b) or annual target incentive awards specified in Paragraph 3(c)), it being understood that the failure of Executive to receive an actual bonus for any fiscal year
equal to or greater than the target bonus opportunity, or to receive in respect of any equity award granted an amount that is equal to or greater than the annual target incentive value ascribed to such award is not a reduction in such compensation
rights, but a failure to effect a scheduled increase in the Base Salary would be a reduction in such compensation rights; (ii) the removal of him by Disney or the Company from the position of Chairman, Walt Disney Parks and Resorts
Worldwide; (iii) a material reduction in Executive’s duties and responsibilities as in effect immediately prior to such reduction; (v) the assignment to Executive of duties that are materially inconsistent with his
position or duties or that materially impair Executive’s ability to function as Chairman, Walt Disney Parks and Resorts Worldwide and any other position in which he is then serving; (vi) the relocation of Executive’s principal
office to a location that is more than 50 miles outside of the greater Los Angeles area; or (vii) a material breach of any material provision of this Agreement by Disney or the Company. In addition, following the occurrence of a Change
in Control (as defined in the Amended and Restated 2005 Stock Incentive Plan (the “2005 Stock Plan”) and the Amended and Restated 1995 Stock Incentive Plan (the “1995

  

 7 

 
Stock Plan”)), any occurrence that would constitute a Triggering Event for purposes of Section 11 of the 2005 Stock Plan and the 1995 Stock Plan (the
“Plans”), as such Plans have been amended through October 2, 2008, shall also constitute an event upon which Executive may effect a Termination for Good Reason in accordance with this Agreement. Notwithstanding the
foregoing, a termination shall not be treated as a Termination for Good Reason (A) if Executive shall have consented in writing to the occurrence of the event giving rise to the claim of Termination for Good Reason, or
(B) unless Executive shall have delivered a written notice to the Company within three months of his having actual knowledge of the occurrence of one of such events stating that he intends to terminate his employment for Good Reason and
specifying the factual basis for such termination, and such event, if capable of being cured, shall not have been cured within 30 days of the receipt of such notice. 
 12. The first sentence of Paragraph 7 of the Agreement is hereby amended to read in its entirety as follows: 
 In the event that the aggregate of all payments or benefits made or provided to the Executive under this Agreement and under all other plans, programs or arrangements of Disney or the Company (the
“Aggregate Payment”) constitutes a parachute payment, as such term is defined in Section 280G(b)(2) of the Code, the Company shall pay to the Executive, prior to the time any excise tax imposed by Section 4999 of
the Internal Revenue Code (“Excise Tax”) is payable with respect to such Aggregate Payment, an additional amount which, after the imposition of all income and excise taxes and interest and penalties thereon, is equal to the
Excise Tax on the Aggregate Payment. 
 13. Paragraph 8 of the Agreement is hereby amended to read in its entirety as
follows: 
 8. Non-competition and Confidentiality. 
 (a) Non-competition. During the Employment Period, Executive shall not become associated with any entity, whether as a
principal, partner, employee, consultant or shareholder (other than as a holder of not in excess of 1% of the outstanding voting shares of any publicly traded company), that is actively engaged in any geographic area in any business which is in
competition with a business conducted by

  

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Disney or the Company or any of their affiliates at the time of the alleged competition. 
 (b) Confidentiality. Without the prior written consent of the Company, except (i) as reasonably necessary in the course of carrying out his duties hereunder or (ii) to the
extent required by an order of a court having competent jurisdiction or under subpoena from an appropriate government agency, Executive shall not disclose any trade secrets, customer lists, drawings, designs, information regarding product
development, existing theatrical projects, marketing plans, sales plans, manufacturing plans, management organization information (including data and other information relating to members of the Board and management), operating policies or manuals,
business plans, financial records or other financial, commercial, business or technical information relating to Disney or the Company or any of their affiliates or information designated as confidential or proprietary that Disney or the Company or
any of their affiliates may receive belonging to suppliers, customers or others who do business with Disney or the Company or any of their affiliates (collectively, “Confidential Information”) unless such Confidential
Information has been previously disclosed to the public by the Company or has otherwise become available to the public (other than by reason of Executive’s breach of this Paragraph 8(b)). 
 (c) Company Property. Promptly following Executive’s termination of employment, Executive shall return to the
Company all property of Disney or the Company, and all copies thereof in Executive’s possession or under his control, except that Executive may retain his personal notes, diaries, Rolodexes, calendars and correspondence of a personal nature.

 (d) Non-Solicitation of Employees. During the Employment Period and, subject to the provisions of
applicable law, during the two-year period following any termination of Executive’s employment, Executive shall not, except in the course of carrying out his duties hereunder, directly or indirectly induce any employee of Disney or the Company
or any of their affiliates to terminate employment with such entity, and shall not directly or indirectly, either individually or as owner, agent, employee, consultant or otherwise, knowingly employ or offer employment to any person who is or was
employed by Disney or the Company or an affiliate thereof unless such person shall have ceased to be employed by such entity for a period of at least six (6) months. 
  

 9 

 (e) Injunctive Relief with Respect to Covenants. Executive
acknowledges and agrees that the covenants and obligations of Executive with respect to noncompetition, nonsolicitation, confidentiality and Disney or Company property relate to special, unique and extraordinary matters and that a violation of any
of the terms of such covenants and obligations may cause Disney or the Company irreparable injury for which adequate remedies are not available at law. Therefore, Executive agrees that Disney and/or the Company shall be entitled to obtain an
injunction, restraining order or such other equitable relief restraining Executive from committing any violation of the covenants and obligations contained in this Paragraph 8. These injunctive remedies are cumulative and are in addition to any
other rights and remedies Disney and/or the Company may have at law or in equity. 
 14. Paragraph 9(g) of the Agreement is
hereby amended to read in its entirety as follows: 
 (g) Authority of the Board. For the avoidance of
doubt, nothing is this Agreement shall preclude the Board from its ability to exercise any power or authority to take such actions as it is required or permitted to take as a matter of law or pursuant to the terms of Disney’s governing
documents. Nothing in this Paragraph 9(g) shall be construed to modify, amend, limit or otherwise impair the rights and entitlements of Executive set forth in the other Paragraphs of this Agreement (including, without limitation, the rights and
entitlements specified in Paragraph 5). 
 15. The first two paragraphs of Exhibit A of the Agreement are hereby amended to read
in their entirety as follows: 
 THIS CONSULTING AGREEMENT (hereinafter referred to as
“Agreement”) is made and entered into by and between Thomas O Staggs (hereinafter referred to as “Consultant”) and Walt Disney Parks and Resorts Worldwide (hereinafter referred to as “Company”), an
indirectly wholly owned subsidiary of The Walt Disney Company (“Disney”) on and as of             , 20     pursuant to that certain
Amended and Restated Employment Agreement by and between Executive and Disney dated as of December 18, 2008, as subsequently further amended and assigned to Company (the “Employment Agreement”). All capitalized terms not
defined herein shall have the meaning ascribed to them in the Employment Agreement. 
 1.(a) Unless this
Agreement is earlier terminated as hereinafter provided, for a period following the termination of Consultant’s

  

 10 

 
employment under the Employment Agreement equal to the lesser of 6 months or the remaining period of the Term of the Employment Agreement (the “Consulting Agreement Period”),
Consultant shall personally and diligently provide to the Company such consulting services as the Company may reasonably request from time to time, provided that such services shall relate to matters appropriate for the former Chairman, Walt Disney
Parks and Resorts Worldwide and shall be a type and nature and duration typical for a post-employment consulting agreement with the former Chairman, Walt Disney Parks and Resorts Worldwide. Consultant shall not be required to report to
Company’s offices and shall be permitted, subject to the terms hereof, to provide consulting services to third parties during the term hereof, provided (i) in no event shall consulting services or other services or advice of any nature be
provided by Consultant, directly or indirectly (whether as an employee, consultant, independent contractor, agent, partner, principal, owner or otherwise) to any person or entity which directly or indirectly owns, operates, manages, develops,
controls or provides services to, any business involved in any of the following activities: (A) the conception, creation, development, production, purchase, sale, distribution, broadcast, transmission or other disposition (including, without
limitation, the licensing and/or merchandising of related consumer products) of audio and/or visual product or works of any nature in any media, including, without limiting the generality of the foregoing, any activity relating to (i) any
aspect of the network, cable, broadcasting, television (including pay-per-view, closed circuit or any inter-active form of distribution of television or other audio/visual product) or internet businesses, or (ii) the development, marketing or
distribution by any vehicle whatsoever of any film or television product or any similar content in any media, whether or not now existing, (B) the operation, management, development, licensing and promotion of themed resorts, hotels and
restaurants or amusement or themed entertainment parks; or (C) the design, development, publishing, promotion or sale of products based on cartoon or other animated characters, films, television and theatrical productions and other intellectual
property derived therefrom, in each case, only to the extent that such person or entity is actively engaged in any geographic area in any business which is in competition with a business conducted by Disney or one of its subsidiaries at the time of
the performance of such services (the “Specified Activities”), and (ii) that any services required by Company shall at all times be provided with precedence being given to Company and on a “first priority” basis to Company,
although Company shall endeavor to provide, when possible, reasonable notice to Consultant of all services required hereunder and to give due consideration, to the extent practicable, to any prior commitments

  

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Consultant may have at such time. In no event shall Consultant be required to devote more than 13.5 hours per week to services to Company hereunder, and the parties agree and understand that
Consultant’s expected commitment to such services shall regularly be less than the stated maximum weekly hours. 
 16.
Paragraph 6(a) of Exhibit A of the Agreement is hereby amended to read in its entirety as follows: 
 6.(a)
Consultant, by virtue of this Agreement, shall acquire no right to use, and shall not use, the name “Disney” or “The Walt Disney Company” or “Walt Disney Parks and Resorts” or “Walt Disney Parks and Resorts
Worldwide” Disney Destinations” or “ABC” or “American Broadcasting Companies” or “ESPN” (either alone or in conjunction with or as a part of any other word, mark, or name) or any marks, fanciful characters or
designs of The Walt Disney Company, or Company or any of their related, affiliated, or subsidiary companies in any advertising, publicity, or promotion; to express or imply any endorsement by Disney or Company or any of their related, affiliated or
subsidiary companies of Consultant’s services; or in any other manner whatsoever (whether or not similar to the uses hereinabove specifically prohibited). Consistent with his obligations under Paragraph 7, this Paragraph 6(a) shall not prevent
Executive from using such names to describe his activities with respect to Disney and the Company and their affiliates under and prior to the Employment Agreement and under this Agreement. 
 17. The first recital of Exhibit B of the Agreement is hereby amended to read in its entirety as follows: 
 WHEREAS, Thomas O. Staggs (hereinafter referred to as “Executive”) and Walt Disney Parks and Resorts Worldwide (hereinafter
referred to as the “Company”) are parties to an Amended and Restated Employment Agreement, dated as of December 18, 2008, as subsequently further amended and assigned to Company (the “Employment Agreement”), which provided
for Executive’s employment with the Company on the terms and conditions specified therein; and 
 II. Assignment of the
Agreement. Disney, with the full and irrevocable consent and approval of Executive, which is hereby confirmed, acknowledged, and agreed, hereby assigns the Agreement and all rights obligations which Disney has thereunder (other than those
rights and obligations which arise out of specific references to “Disney” in the

  

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Agreement as amended hereby) to Walt Disney Parks and Resorts Worldwide, which hereby accepts and assumes such assignment and all of the rights and obligations of Disney assigned pursuant to the
foregoing and agrees to perform all of the obligations of “Company” thereunder arising from and after January 1, 2010. 
 As
amended and assigned pursuant hereto, the Agreement shall continue in full force and effect in accordance with its terms. 
 This Amendment and
Assignment may be executed in counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument, and facsimile signature pages shall be accepted as originals. 
 IN WITNESS WHEREOF, Disney has caused this Amendment and Assignment to be executed by its duly authorized officer and Executive has hereunto set his hand as
of the day and year first above written. 
  

			
	THE WALT DISNEY COMPANY
		
	By:	 	/s/ Mary Jayne Parker
	Title:	 	Executive Vice President and
		 	Chief Human Resources Officer
		
	Date:	 	January 7, 2010

  

	
	/s/ Thomas O. Staggs
	Thomas O. Staggs

 Date: January 7, 2010 
 ACCEPTED AND AGREED TO: 
  

			
	WALT DISNEY PARKS AND RESORTS WORLDWIDE
		
	By:	 	/s/Julie L. Hodges
	Title:	 	Senior Vice President – Human Resources and Diversity and Inclusion
		
	Date:	 	January 7, 2010

  

 13Common Stock Purchase Agreement

 Exhibit 10.1 
 Execution Copy 
 COMMON STOCK PURCHASE
AGREEMENT 
 Dated as of January 8, 2010 
 by and between 
 VICAL INCORPORATED 

and 
 AZIMUTH OPPORTUNITY LTD. 

 TABLE OF CONTENTS 
  

					
	 	  	 	  	Page
	ARTICLE I PURCHASE AND SALE OF COMMON STOCK	  	1
	 Section 1.1
	  	Purchase and Sale of Stock	  	1
	 Section 1.2
	  	Effective Date; Settlement Dates	  	1
	 Section 1.3
	  	The Shares	  	2
	 Section 1.4
	  	Current Report; Prospectus Supplement	  	2
		
	ARTICLE II FIXED REQUEST TERMS; OPTIONAL AMOUNT	  	2
	 Section 2.1
	  	Fixed Request Notice	  	2
	 Section 2.2
	  	Fixed Requests	  	3
	 Section 2.3
	  	Share Calculation	  	4
	 Section 2.4
	  	Limitation of Fixed Requests	  	4
	 Section 2.5
	  	Reduction of Commitment	  	4
	 Section 2.6
	  	Below Threshold Price	  	4
	 Section 2.7
	  	Settlement	  	5
	 Section 2.8
	  	Reduction of Pricing Period	  	5
	 Section 2.9
	  	Optional Amount	  	6
	 Section 2.10
	  	Calculation of Optional Amount Shares	  	7
	 Section 2.11
	  	Exercise of Optional Amount	  	7
	 Section 2.12
	  	Aggregate Limit	  	7
		
	ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE INVESTOR	  	8
	 Section 3.1
	  	Organization and Standing of the Investor	  	8
	 Section 3.2
	  	Authorization and Power	  	8
	 Section 3.3
	  	No Conflicts	  	9
	 Section 3.4
	  	Information	  	9
		
	ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE COMPANY	  	10
	 Section 4.1
	  	Organization, Good Standing and Power	  	10
	 Section 4.2
	  	Authorization, Enforcement	  	10
	 Section 4.3
	  	Capitalization	  	10
	 Section 4.4
	  	Issuance of Shares	  	11
	 Section 4.5
	  	No Conflicts	  	11
	 Section 4.6
	  	Commission Documents, Financial Statements	  	12
	 Section 4.7
	  	Subsidiaries	  	13
	 Section 4.8
	  	No Material Adverse Effect	  	13
	 Section 4.9
	  	Indebtedness	  	13
	 Section 4.10
	  	Title To Assets	  	14
	 Section 4.11
	  	Actions Pending	  	14
	 Section 4.12
	  	Compliance With Law	  	14
	 Section 4.13
	  	Certain Fees	  	14
	 Section 4.14
	  	Operation of Business	  	14
	 Section 4.15
	  	Environmental Compliance	  	16
	 Section 4.16
	  	Material Agreements	  	17

  

 i 

					
	 Section 4.17
	  	Transactions With Affiliates	  	17
	 Section 4.18
	  	Securities Act; FINRA Rules	  	18
	 Section 4.19
	  	Employees	  	19
	 Section 4.20
	  	Use of Proceeds	  	20
	 Section 4.21
	  	Investment Company Act Status	  	20
	 Section 4.22
	  	ERISA	  	20
	 Section 4.23
	  	Taxes	  	20
	 Section 4.24
	  	Insurance	  	20
	 Section 4.25
	  	Acknowledgement Regarding Investor’s Purchase of Shares	  	21
		
	ARTICLE V COVENANTS	  	21
	 Section 5.1
	  	Securities Compliance	  	21
	 Section 5.2
	  	Registration and Listing	  	21
	 Section 5.3
	  	Compliance with Laws	  	21
	 Section 5.4
	  	Keeping of Records and Books of Account; Foreign Corrupt Practices Act	  	22
	 Section 5.5
	  	Limitations on Holdings and Issuances	  	23
	 Section 5.6
	  	Other Agreements and Other Financings	  	23
	 Section 5.7
	  	Stop Orders	  	24
	 Section 5.8
	  	Amendments to the Registration Statement; Prospectus Supplements; Free Writing Prospectuses	  	25
	 Section 5.9
	  	Prospectus Delivery	  	26
	 Section 5.10
	  	Selling Restrictions	  	26
	 Section 5.11
	  	Effective Registration Statement	  	27
	 Section 5.12
	  	Non-Public Information	  	27
	 Section 5.13
	  	Broker/Dealer	  	27
	 Section 5.14
	  	Disclosure Schedule	  	27
		
	 ARTICLE VI OPINION OF COUNSEL AND CERTIFICATE; CONDITIONS TO THE SALE AND PURCHASE OF THE SHARES
	  	28
	 Section 6.1
	  	Opinion of Counsel and Certificate	  	28
	 Section 6.2
	  	Conditions Precedent to the Obligation of the Company	  	28
	 Section 6.3
	  	Conditions Precedent to the Obligation of the Investor	  	30
		
	ARTICLE VII TERMINATION	  	32
	 Section 7.1
	  	Term, Termination by Mutual Consent	  	32
	 Section 7.2
	  	Other Termination	  	32
	 Section 7.3
	  	Effect of Termination	  	33
		
	ARTICLE VIII INDEMNIFICATION	  	33
	 Section 8.1
	  	General Indemnity	  	33
	 Section 8.2
	  	Indemnification Procedures	  	35
		
	ARTICLE IX MISCELLANEOUS	  	36
	 Section 9.1
	  	Fees and Expenses	  	36
	 Section 9.2
	  	Specific Enforcement, Consent to Jurisdiction, Waiver of Jury Trial	  	37
	 Section 9.3
	  	Entire Agreement; Amendment	  	38

  

 ii 

					
	 Section 9.4
	  	Notices	  	38
	 Section 9.5
	  	Waivers	  	39
	 Section 9.6
	  	Headings	  	39
	 Section 9.7
	  	Successors and Assigns	  	39
	 Section 9.8
	  	Governing Law	  	39
	 Section 9.9
	  	Survival	  	40
	 Section 9.10
	  	Counterparts	  	40
	 Section 9.11
	  	Publicity	  	40
	 Section 9.12
	  	Severability	  	40
	 Section 9.13
	  	Further Assurances	  	40
			
	Annex A.	  	Definitions	  	

  

 iii 

 COMMON STOCK PURCHASE AGREEMENT 
 This COMMON STOCK PURCHASE AGREEMENT, made and entered into on this 8th day of January 2010 (this “Agreement”), by and
between Azimuth Opportunity Ltd., an international business company incorporated under the laws of the British Virgin Islands (the “Investor”), and Vical Incorporated, a corporation organized and existing under the laws of the State
of Delaware (the “Company”). Capitalized terms used but not defined herein shall have the meanings ascribed to such terms in Annex A hereto. 
 RECITALS 
 WHEREAS, the parties desire that, upon the terms and
subject to the conditions contained herein, the Company may issue and sell to the Investor and the Investor shall thereupon purchase from the Company up to $25,000,000 of newly issued shares of the Company’s common stock, $0.01 par value
(“Common Stock”), subject, in all cases, to the Trading Market Limit; and 
 WHEREAS, the offer and sale
of the shares of Common Stock hereunder have been registered by the Company in the Registration Statement, which has been declared effective by order of the Commission under the Securities Act; 
 NOW, THEREFORE, the parties hereto, intending to be legally bound, hereby agree as follows: 
 ARTICLE I 
 PURCHASE AND SALE OF COMMON STOCK 
 Section 1.1 Purchase and Sale of Stock. Upon the terms
and subject to the conditions of this Agreement, during the Investment Period the Company in its discretion may issue and sell to the Investor up to $25,000,000 (the “Total Commitment”) of duly authorized, validly issued, fully paid
and non-assessable shares of Common Stock (subject in all cases to the Trading Market Limit, the “Aggregate Limit”), by (i) the delivery to the Investor of not more than 24 separate Fixed Request Notices (unless the Investor
and the Company mutually agree that a different number of Fixed Request Notices may be delivered) as provided in Article II hereof and (ii) the exercise by the Investor of Optional Amounts, which the Company may in its discretion grant to the
Investor and which may be exercised by the Investor, in whole or in part, as provided in Article II hereof. The aggregate of all Fixed Request Amounts and Optional Amount Dollar Amounts shall not exceed the Aggregate Limit. 
 Section 1.2 Effective Date; Settlement Dates. This Agreement shall become effective and binding upon delivery of
counterpart signature pages of this Agreement executed by each of the parties hereto, and by delivery of an opinion of counsel and a certificate of the Company as provided in Section 6.1 hereof, to the offices of Greenberg Traurig, LLP, 200
Park Avenue, New York, New York 10166, at 4:00 p.m., New York time, on the Effective Date. In consideration of and in express reliance upon the representations, warranties and covenants, and otherwise upon the terms and subject to the conditions, of
this Agreement, from and after the Effective Date and during the Investment Period (i) the Company shall issue and sell to the Investor, and the Investor agrees to purchase from the Company, the Shares in respect of each Fixed Request and
(ii) the Investor may in its discretion elect to purchase Shares in

 
respect of each Optional Amount. The issuance and sale of Shares to the Investor pursuant to any Fixed Request or Optional Amount shall occur on the applicable Settlement Date in accordance with
Sections 2.7 and 2.9 (or on such Trading Day in accordance with Section 2.8, as applicable), provided in each case that all of the conditions precedent thereto set forth in Article VI theretofore shall have been fulfilled or (to the
extent permitted by applicable law) waived. 
 Section 1.3 The Shares. The Company has or will have duly
authorized and reserved for issuance, and covenants to continue to so reserve once reserved for issuance, free of all preemptive and other similar rights, at all times during the Investment Period, the requisite aggregate number of authorized but
unissued shares of its Common Stock to timely effect the issuance, sale and delivery in full to the Investor of all Shares to be issued in respect of all Fixed Requests and Optional Amounts under this Agreement, in any case prior to the issuance to
the Investor of such Shares. 
 Section 1.4 Current Report; Prospectus Supplement. As soon as practicable,
but in any event not later than 5:30 p.m. (New York time) on the first Trading Day immediately following the Effective Date, the Company shall file with the Commission a report on Form 8-K relating to the transactions contemplated by, and describing
the material terms and conditions of, this Agreement and disclosing all information relating to the transactions contemplated hereby required to be disclosed in the Registration Statement and the Base Prospectus (but which permissibly has been
omitted therefrom in accordance with the Securities Act), including, without limitation, information required to be disclosed in the section captioned “Plan of Distribution” in the Base Prospectus (the “Current Report”).
The Current Report shall include a copy of this Agreement as an exhibit. To the extent applicable, the Current Report shall be incorporated by reference in the Registration Statement in accordance with the provisions of Rule 430B under the
Securities Act. The Company heretofore has provided the Investor a reasonable opportunity to comment on a draft of such Current Report and has given due consideration to such comments. The Company shall file a final Base Prospectus pursuant to Rule
424(b) under the Securities Act on or prior to the second Trading Day immediately following the Effective Date. Pursuant to Section 5.9 and subject to the provisions of Section 5.8, on the first Trading Day immediately following the last
Trading Day of each Pricing Period, the Company shall file with the Commission a Prospectus Supplement pursuant to Rule 424(b) under the Securities Act disclosing the number of Shares to be issued and sold to the Investor thereunder, the total
purchase price therefor and the net proceeds to be received by the Company therefrom and, to the extent required by the Securities Act, identifying the Current Report. 
 ARTICLE II 
 FIXED REQUEST TERMS; OPTIONAL AMOUNT 
 Subject to the satisfaction of the conditions set forth in this Agreement, the parties agree (unless otherwise mutually agreed upon by the
parties in writing) as follows: 
 Section 2.1 Fixed Request Notice. The Company may, from time to time in
its sole discretion, no later than 9:30 a.m. (New York time) on the first Trading Day of the Pricing Period, provide to the Investor a Fixed Request notice, substantially in the form attached hereto as Exhibit A (the “Fixed Request
Notice”), which Fixed Request Notice shall become effective at 9:30 a.m. (New

  

 2 

 
York time) on the first Trading Day of the Pricing Period specified in the Fixed Request Notice; provided, however, that if the Company delivers the Fixed Request Notice to the
Investor later than 9:30 a.m. (New York time) on a Trading Day, then the first Trading Day of such Pricing Period shall not be the Trading Day on which the Investor received such Fixed Request Notice, but rather shall be the next Trading Day (unless
a subsequent Trading Day is therein specified). The Fixed Request Notice shall specify the Fixed Amount Requested, establish the Threshold Price for such Fixed Request, designate the first and last Trading Day of the Pricing Period and specify the
Optional Amount, if any, that the Company elects to grant to the Investor during the Pricing Period and the applicable Threshold Price for such Optional Amount (the “Optional Amount Threshold Price”). The Threshold Price and the
Optional Amount Threshold Price established by the Company in a Fixed Request Notice may be the same or different, in the Company’s sole discretion. Upon the terms and subject to the conditions of this Agreement, the Investor is obligated to
accept each Fixed Request Notice prepared and delivered in accordance with the provisions of this Agreement. 
 Section 2.2 Fixed Requests. From time to time during the Investment Period, the Company may in its sole discretion deliver to the Investor a Fixed Request Notice for a specified Fixed Amount Requested, and the applicable
discount price (the “Discount Price”) shall be determined, in accordance with the price and share amount parameters as set forth below or such other parameters mutually agreed upon by the Investor and the Company, and upon the terms
and subject to the conditions of this Agreement, the Investor shall purchase from the Company the Shares subject to such Fixed Request Notice at the Discount Price; provided, however, that (i) if an ex-dividend date is established
by the Trading Market in respect of the Common Stock on or between the first Trading Day of the applicable Pricing Period and the applicable Settlement Date, the Discount Price shall be reduced by the per share dividend amount and (ii) the
Company may not deliver any single Fixed Request Notice for a Fixed Amount Requested in excess of the lesser of (a) the amount in the applicable Fixed Amount Requested column below and (b) 2.5% of the Market Capitalization: 
  

					
	 Threshold Price
	  	 Fixed Amount Requested
	  	 Discount Price

	 Equal to or greater than $10.00
	  	Not to exceed $12,500,000	  	96.00% of the VWAP
	 Equal to or greater than $9.00 and less than $10.00
	  	Not to exceed $11,250,000	  	95.75% of the VWAP
	 Equal to or greater than $8.00 and less than $9.00
	  	Not to exceed $10,000,000	  	95.50% of the VWAP
	 Equal to or greater than $7.00 and less than $8.00
	  	Not to exceed $8,750,000	  	95.25% of the VWAP
	 Equal to or greater than $6.00 and less than $7.00
	  	Not to exceed $7,500,000	  	95.00% of the VWAP
	 Equal to or greater than $5.00 and less than $6.00
	  	Not to exceed $6,250,000	  	94.75% of the VWAP
	 Equal to or greater than $4.00 and less than $5.00
	  	Not to exceed $5,000,000	  	94.50% of the VWAP
	 Equal to or greater than $3.00 and less than $4.00
	  	Not to exceed $3,750,000	  	94.25% of the VWAP
	 Equal to or greater than $2.00 and less than $3.00
	  	Not to exceed $2,500,000	  	94.00% of the VWAP
	 Equal to or greater than $1.50 and less than $2.00
	  	Not to exceed $1,750,000	  	93.75% of the VWAP

  

 3 

 Anything to the contrary in this Agreement notwithstanding, at no time shall the Investor be
required to purchase more than $12,500,000 worth of Common Stock in respect of any Pricing Period (not including Common Stock subject to any Optional Amount). The date on which the Company delivers any Fixed Request Notice in accordance with this
Section 2.2 hereinafter shall be referred to as a “Fixed Request Exercise Date”. 
 Section 2.3
Share Calculation. With respect to the Trading Days during the applicable Pricing Period for which the VWAP equals or exceeds the Threshold Price, the number of Shares to be issued by the Company to the Investor pursuant to a Fixed
Request shall equal the aggregate sum of each quotient (calculated for each Trading Day during the applicable Pricing Period for which the VWAP equals or exceeds the Threshold Price) determined pursuant to the following equation (rounded to the
nearest whole Share): 
  

	N =  	(A x B)/C, where: 

  

	N =  	the number of Shares to be issued by the Company to the Investor in respect of a Trading Day during the applicable Pricing Period for which the VWAP equals or exceeds
the Threshold Price, 

  

	A =  	0.10 (the “Multiplier”), 

  

	B =  	the total Fixed Amount Requested, and 

  

	C =  	the applicable Discount Price. 

 Section 2.4 Limitation of Fixed Requests. The Company shall not make more than one Fixed Request in each Pricing Period. Not less than five Trading Days shall elapse between the end of one Pricing Period and the
commencement of any other Pricing Period during the Investment Period. There shall be permitted a maximum of 24 Fixed Requests during the Investment Period. Each Fixed Request automatically shall expire immediately following the last Trading Day of
each Pricing Period. 
 Section 2.5 Reduction of Commitment. On the last Trading Day of each Pricing Period,
the Investor’s Total Commitment under this Agreement automatically (and without the need for any amendment to this Agreement) shall be reduced, on a dollar-for-dollar basis, by the total amount of the Fixed Request Amount and the Optional
Amount Dollar Amount, if any, for such Pricing Period paid to the Company at the Settlement Date. 
 Section 2.6
Below Threshold Price. If the VWAP on any Trading Day in a Pricing Period is lower than the Threshold Price, then for each such Trading Day the Fixed Amount Requested shall be reduced, on a dollar-for-dollar basis, by an amount equal to
the product of (x) the Multiplier and (y) the total Fixed Amount Requested, and no Shares shall be purchased or sold with respect to such Trading Day, except as provided below. If trading in the Common Stock on NASDAQ (or any other U.S.
national securities exchange

  

 4 

 
on which the Common Stock is then listed) is suspended for any reason for more than three hours on any Trading Day, the Investor may at its option deem the price of the Common Stock to be lower
than the Threshold Price for such Trading Day and, for each such Trading Day, the total amount of the Fixed Amount Requested shall be reduced as provided in the immediately preceding sentence, and no Shares shall be purchased or sold with respect to
such Trading Day, except as provided below. For each Trading Day during a Pricing Period on which the VWAP is lower (or is deemed to be lower as provided in the immediately preceding sentence) than the Threshold Price, the Investor may in its sole
discretion elect to purchase such U.S. dollar amount of Shares equal to the amount by which the Fixed Amount Requested has been reduced in accordance with this Section 2.6, at the Threshold Price multiplied by the applicable percentage
determined in accordance with the price and share amount parameters set forth in Section 2.2. The Investor shall inform the Company via facsimile transmission not later than 8:00 p.m. (New York time) on the last Trading Day of such Pricing
Period as to the number of Shares, if any, the Investor elects to purchase as provided in this Section 2.6. 
 Section 2.7 Settlement. The payment for, against simultaneous delivery of, Shares in respect of each Fixed Request shall be settled on the second Trading Day next following the last Trading Day of each Pricing Period, or
on such earlier date as the parties may mutually agree (the “Settlement Date”). On each Settlement Date, the Company shall deliver the Shares purchased by the Investor to the Investor or its designees via DTC’s
Deposit/Withdrawal at Custodian (DWAC) system, against simultaneous payment therefor to the Company’s designated account by wire transfer of immediately available funds, provided that if the Shares are received by the Investor later than
1:00 p.m. (New York time), payment therefor shall be made with next day funds. As set forth in Section 9.1(ii), a failure by the Company to deliver such Shares shall result in the payment of liquidated damages by the Company to the Investor.

 Section 2.8 Reduction of Pricing Period. If during a Pricing Period the Company elects to reduce the
number of Trading Days in such Pricing Period (and thereby amend its previously delivered Fixed Request Notice), the Company shall so notify the Investor before 9:00 a.m. (New York time) on any Trading Day during a Pricing Period (a
“Reduction Notice”) and the last Trading Day of such Pricing Period shall be the Trading Day immediately preceding the Trading Day on which the Investor received such Reduction Notice; provided, however, that if the
Company delivers the Reduction Notice later than 9:00 a.m. (New York time) on a Trading Day during a Pricing Period, then the last Trading Day of such Pricing Period instead shall be the Trading Day on which the Investor received such Reduction
Notice. 
 Upon receipt of a Reduction Notice, the Investor (i) shall purchase the Shares in respect of each Trading Day in
such reduced Pricing Period for which the VWAP equals or exceeds the Threshold Price in accordance with Section 2.3 hereof; (ii) may elect to purchase the Shares in respect of any Trading Day in such reduced Pricing Period for which the
VWAP is (or is deemed to be) lower than the Threshold Price in accordance with Section 2.6 hereof; and (iii) may elect to exercise all or any portion of an Optional Amount on any Trading Day during such reduced Pricing Period in accordance
with Sections 2.10 and 2.11 hereof. 
  

 5 

 In addition, upon receipt of a Reduction Notice, the Investor may elect to purchase such
U.S. dollar amount of additional Shares equal to the product determined pursuant to the following equation: 
  

	D =     (A/B)	x (B – C), where: 

  

	D =  	the U.S. dollar amount of additional Shares to be purchased, 

  

	A =  	the Fixed Amount Requested, 

  

	B =  	10 or, for purposes of this Section 2.8, such lesser number of Trading Days as the parties may mutually agree to, and 

  

	C =  	the number of Trading Days in the reduced Pricing Period, 

 at a per Share price equal to (x) the Fixed Amount Requested attributable to the reduced Pricing Period divided by (y) the number of Shares to be purchased during such reduced Pricing Period
pursuant to clauses (i) and (ii) (as applicable) of the immediately preceding paragraph. 
 The Investor may also
elect to exercise any portion of the applicable Optional Amount which was unexercised during the reduced Pricing Period by issuing an Optional Amount Notice to the Company not later than 10:00 a.m. (New York time) on the first Trading Day next
following the last Trading Day of the reduced Pricing Period. The number of Shares to be issued upon exercise of such Optional Amount shall be calculated pursuant to the equation set forth in Section 2.10 hereof, except that “C” shall
equal the greater of (i) the VWAP for the Common Stock on the last Trading Day of the reduced Pricing Period or (ii) the Optional Amount Threshold Price. 
 The payment for, against simultaneous delivery of, Shares to be purchased and sold in accordance with this Section 2.8 shall be settled on the second Trading Day next following the Trading Day on
which the Investor receives a Reduction Notice. 
 Section 2.9 Optional Amount. With respect to any Pricing
Period, the Company may in its sole discretion grant to the Investor the right to exercise, from time to time during the Pricing Period (but not more than once on any Trading Day), all or any portion of an Optional Amount. The maximum Optional
Amount Dollar Amount and the Optional Amount Threshold Price shall be set forth in the Fixed Request Notice. If an ex-dividend date is established by the Trading Market in respect of the Common Stock on or between the first Trading Day of the
applicable Pricing Period and the applicable Settlement Date, the applicable exercise price in respect of the Optional Amount shall be reduced by the per share dividend amount. Each daily Optional Amount exercise shall be aggregated during the
Pricing Period and settled on the next Settlement Date. The Optional Amount Threshold Price designated by the Company in its Fixed Request Notice shall apply to each Optional Amount exercised during the applicable Pricing Period. 
  

 6 

 Section 2.10 Calculation of Optional Amount Shares. The number of shares
of Common Stock to be issued in connection with the exercise of an Optional Amount shall be the quotient determined pursuant to the following equation (rounded to the nearest whole Share): 
  

	O =  	A/(B x C), where: 

  

	O =  	the number of shares of Common Stock to be issued in connection with such Optional Amount exercise, 

  

	A =  	the Optional Amount Dollar Amount with respect to which the Investor has delivered an Optional Amount Notice, 

  

	B =  	the applicable percentage determined in accordance with the price and shares amount parameters set forth in Section 2.2 (with the Optional Amount Threshold Price
serving as the Threshold Price for such purposes), and 

  

	C =  	the greater of (i) the VWAP for the Common Stock on the day the Investor delivers the Optional Amount Notice or (ii) the Optional Amount Threshold Price.

 Section 2.11 Exercise of Optional Amount. If granted by the Company to the Investor with
respect to a Pricing Period, all or any portion of the Optional Amount may be exercised by the Investor on any Trading Day during the Pricing Period, subject to the limitations set forth in Section 2.9. As a condition to each exercise of an
Optional Amount pursuant to this Section 2.11, the Investor shall issue an Optional Amount Notice to the Company no later than 8:00 p.m. (New York time) on the day of such Optional Amount exercise. If the Investor does not exercise an Optional
Amount in full by 8:00 p.m. (New York time) on the last Trading Day of the applicable Pricing Period, such unexercised portion of the Investor’s Optional Amount with respect to that Pricing Period automatically shall lapse and terminate.

 Section 2.12 Aggregate Limit. Notwithstanding anything to the contrary contained in this Agreement, in no
event may the Company issue a Fixed Request Notice or grant an Optional Amount to the extent that the sale of Shares pursuant thereto and pursuant to all prior Fixed Request Notices and Optional Amounts issued hereunder, and as liquidated damages
pursuant to Section 9.1(ii), would cause the Company to sell or the Investor to purchase Shares which in the aggregate are in excess of the Aggregate Limit. If the Company issues a Fixed Request Notice or Optional Amount that otherwise would
permit the Investor to purchase shares of Common Stock which would cause the aggregate purchases by Investor hereunder to exceed the Aggregate Limit, such Fixed Request Notice or Optional Amount shall be void ab initio to the extent of the
amount by which the dollar value of shares or number of shares, as the case may be, of Common Stock otherwise issuable pursuant to such Fixed Request Notice or Optional Amount together with the dollar value of shares or number of shares, as the case
may be, of all other Common Stock purchased by the Investor pursuant hereto, or issued as liquidated damages pursuant to Section 9.1(ii), would exceed the Aggregate Limit. The Company hereby represents, warrants and covenants that neither it
nor any of its Subsidiaries (i) has effected any transaction or series of transactions, (ii) is a party to any pending transaction or series of transactions or (iii) shall enter into any contract, agreement, agreement-in-principle,
arrangement or understanding with respect to, or shall effect, any Other Financing which, in any of such

  

 7 

 
cases, may be aggregated with the transactions contemplated by this Agreement for purposes of determining whether approval of the Company’s stockholders is required under any bylaw, listed
securities maintenance standards or other rules of the Trading Market; provided, however, that the Company shall be permitted to take any action referred to in clause (iii) above if (a) the Company has timely provided the
Investor with an Integration Notice as provided in Section 5.6(ii) hereof and (b) unless the Investor has previously terminated this Agreement pursuant to Section 7.2, the Company obtains the requisite stockholder approval prior to
the closing of such Other Financing. 
 At the Company’s sole discretion, and effective automatically upon delivery of
notice by the Company to the Investor, this Agreement may be amended by the Company from time to time to reduce the Aggregate Limit by a specified dollar amount and/or number of shares of Common Stock as shall be determined by the Company in its
sole discretion; provided, however, that any such amendment of this Agreement (and any such purported amendment) shall be void and of no force and effect if the effect thereof would restrict, materially delay, conflict with or impair
the ability or right of the Company to perform its obligations under this Agreement, including, without limitation, the obligation of the Company to deliver Shares to the Investor in respect of a Fixed Request or Optional Amount on the applicable
Settlement Date. In the event the Company shall have elected to reduce the Aggregate Limit as provided in the immediately preceding sentence, at the Company’s sole discretion, and effective automatically upon delivery of notice by the Company
to the Investor, the Company may subsequently amend this Agreement to increase the Aggregate Limit up to $25,000,000; provided, however, that in no event shall the Company be entitled to issue Fixed Requests and grant Optional Amounts
during the remainder of the Investment Period for an aggregate amount greater than the amount obtained by subtracting (x) the aggregate of all Fixed Request Amounts and Optional Amount Dollar Amounts (including any amounts paid as liquidated
damages pursuant to Section 9.1(ii) hereunder) covered by all Fixed Requests and Optional Amounts theretofore issued or granted by the Company in respect of which a settlement has occurred pursuant to Section 2.7 from (y) $25,000,000,
subject in all cases to the Trading Market Limit. 
 ARTICLE III 
 REPRESENTATIONS AND WARRANTIES OF THE INVESTOR 
 The
Investor hereby makes the following representations and warranties to the Company: 
 Section 3.1 Organization and
Standing of the Investor. The Investor is an international business company duly organized, validly existing and in good standing under the laws of the British Virgin Islands. 
 Section 3.2 Authorization and Power. The Investor has the requisite corporate power and authority to enter into and
perform its obligations under this Agreement and to purchase the Shares in accordance with the terms hereof. The execution, delivery and performance of this Agreement by the Investor and the consummation by it of the transactions contemplated hereby
have been duly authorized by all necessary corporate action, and no further consent or authorization of the Investor, its Board of Directors or stockholders is required. This Agreement has been duly executed and delivered by the Investor. This
Agreement constitutes a valid

  

 8 

 
and binding obligation of the Investor enforceable against it in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium, liquidation, conservatorship, receivership, or similar laws relating to, or affecting generally the enforcement of, creditor’s rights and remedies or by other equitable principles of general application. 
 Section 3.3 No Conflicts. The execution, delivery and performance by the Investor of this Agreement and the consummation
by the Investor of the transactions contemplated herein do not and shall not (i) result in a violation of such Investor’s charter documents, bylaws or other applicable organizational instruments, (ii) conflict with, constitute a
default (or an event which, with notice or lapse of time or both, would become a default) under, or give rise to any rights of termination, amendment, acceleration or cancellation of, any material agreement, mortgage, deed of trust, indenture, note,
bond, license, lease agreement, instrument or obligation to which the Investor is a party or is bound, (iii) create or impose any lien, charge or encumbrance on any property of the Investor under any agreement or any commitment to which the
Investor is party or under which the Investor is bound or under which any of its properties or assets are bound, or (iv) result in a violation of any federal, state, local or foreign statute, rule, or regulation, or any order, judgment or
decree of any court or governmental agency applicable to the Investor or by which any of its properties or assets are bound or affected, except, in the case of clauses (ii), (iii) and (iv), for such conflicts, defaults, terminations,
amendments, acceleration, cancellations and violations as would not, individually or in the aggregate, prohibit or otherwise interfere with the ability of the Investor to enter into and perform its obligations under this Agreement in any material
respect. The Investor is not required under federal, state, local or foreign law, rule or regulation to obtain any consent, authorization or order of, or make any filing or registration with, any court or governmental agency in order for it to
execute, deliver or perform any of its obligations under this Agreement or to purchase the Shares in accordance with the terms hereof. 
 Section 3.4 Information. All materials relating to the business, financial condition, management and operations of the Company and materials relating to the offer and sale of the Shares which have been requested by the
Investor have been furnished or otherwise made available to the Investor or its advisors (subject to Section 5.12 of this Agreement). The Investor and its advisors have been afforded the opportunity to ask questions of representatives of the
Company. The Investor has sought such accounting, legal and tax advice as it has considered necessary to make an informed investment decision with respect to its acquisition of the Shares. The Investor understands that it (and not the Company) shall
be responsible for its own tax liabilities that may arise as a result of this investment or the transactions contemplated by this Agreement. 
  

 9 

 ARTICLE IV 
 REPRESENTATIONS AND WARRANTIES OF THE COMPANY 
 Except
as set forth in the disclosure schedule delivered by the Company to the Investor (which is hereby incorporated by reference in, and constitutes an integral part of, this Agreement) (the “Disclosure Schedule”), the Company hereby
makes the following representations and warranties to the Investor: 
 Section 4.1 Organization, Good Standing and
Power. The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware and has the requisite corporate power and authority to own, lease and operate its properties and assets and to
conduct its business as it is now being conducted. The Company and each Subsidiary is duly qualified as a foreign corporation to do business and is in good standing in every jurisdiction in which the nature of the business conducted or property
owned by it makes such qualification necessary, except for any jurisdiction in which the failure to be so qualified would not have a Material Adverse Effect. 
 Section 4.2 Authorization, Enforcement. The Company has the requisite corporate power and authority to enter into and perform this Agreement and to issue and sell the Shares in
accordance with the terms hereof. Except for approvals of the Company’s Board of Directors or a committee thereof as may be required in connection with any issuance and sale of Shares to the Investor hereunder (which approvals shall be obtained
prior to the delivery of any Fixed Request Notice), the execution, delivery and performance by the Company of this Agreement and the consummation by it of the transactions contemplated hereby have been duly and validly authorized by all necessary
corporate action and no further consent or authorization of the Company or its Board of Directors or stockholders is required. This Agreement has been duly executed and delivered by the Company and constitutes a valid and binding obligation of the
Company enforceable against the Company in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, liquidation, conservatorship, receivership or similar laws relating
to, or affecting generally the enforcement of, creditor’s rights and remedies or by other equitable principles of general application. 
 Section 4.3 Capitalization. The authorized capital stock of the Company and the shares thereof issued and outstanding are as set forth in the Commission Documents as of the dates
reflected therein. All of the outstanding shares of Common Stock have been duly authorized and validly issued, and are fully paid and nonassessable. Except as set forth in the Commission Documents, as of the Effective Date, no shares of Common Stock
were entitled to preemptive rights or registration rights and there were no outstanding options, warrants, scrip, rights to subscribe to, call or commitments of any character whatsoever relating to, or securities or rights convertible into or
exchangeable for, any shares of capital stock of the Company issued or granted by the Company, other than those issued or granted in the ordinary course of business. Except as set forth in the Commission Documents, there were no contracts,
commitments, understandings, or arrangements by which the Company is or may become bound to issue additional shares of the capital stock of the Company or options, securities or rights convertible into or exchangeable for any shares of capital stock
of the Company issued or granted by the Company, other than those issued or granted in the ordinary course of business. Except for customary transfer restrictions contained in agreements entered into by the Company to sell restricted securities or
as set forth in the Commission Documents, as of the Effective Date, the Company was not a party to, and it had no knowledge of, any agreement restricting the voting or transfer of any shares of the capital stock of the Company. Except as set forth
in the Commission Documents, the offer and sale of all capital stock, convertible or exchangeable securities, rights, warrants or options of the Company issued prior to the Effective Date complied with all applicable federal and state securities
laws, and no stockholder has any right of rescission or

  

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damages or any “put” or similar right with respect thereto that would have a Material Adverse Effect. The Company has furnished or made available to the Investor via the
Commission’s Electronic Data Gathering, Analysis and Retrieval System (“EDGAR”) true and correct copies of the Company’s Certificate of Incorporation as in effect on the Effective Date (the “Charter”), and
the Company’s Bylaws as in effect on the Effective Date (the “Bylaws”), and true and correct copies (redacted as appropriate) of all executed resolutions of the Company’s Board of Directors (and committees thereof)
relating to the capital stock of the Company (and transactions in respect thereof) since December 31, 2006 (except with respect to issuances of shares of capital stock of the Company to directors, consultants, or employees of the Company as
fees or compensation that were duly approved by the Company’s Board of Directors or a committee thereof or other subcommittee established and authorized by the Board to issue shares or other equity securities under the Company’s equity
incentive plans). 
 Section 4.4 Issuance of Shares. The Shares to be issued under this Agreement have been
or will be duly authorized by all necessary corporate action and, when paid for or issued in accordance with the terms hereof, the Shares shall be validly issued and outstanding, fully paid and nonassessable, and, when the Shares have been issued to
the Investor, the Investor shall be entitled to all rights accorded to a holder and beneficial owner of Common Stock. 
 Section 4.5 No Conflicts. The execution, delivery and performance by the Company of this Agreement and the consummation by the Company of the transactions contemplated herein do not and shall not (i) result in a
violation of any provision of the Company’s Charter or Bylaws, (ii) conflict with, constitute a default (or an event which, with notice or lapse of time or both, would become a default) under, or give rise to any rights of termination,
amendment, acceleration or cancellation of, any material agreement, mortgage, deed of trust, indenture, note, bond, license, lease agreement, instrument or obligation to which the Company or any of its Significant Subsidiaries is a party or is bound
(including, without limitation, any listing agreement with the Trading Market), (iii) create or impose a lien, charge or encumbrance on any property of the Company or any of its Significant Subsidiaries under any agreement or any commitment to
which the Company or any of its Significant Subsidiaries is a party or under which the Company or any of its Significant Subsidiaries is bound or under which any of their respective properties or assets are bound, or (iv) result in a violation
of any federal, state, local or foreign statute, rule, regulation, order, judgment or decree applicable to the Company or any of its Subsidiaries or by which any property or asset of the Company or any of its Subsidiaries are bound or affected,
except, in the case of clauses (ii), (iii) and (iv), for such conflicts, defaults, terminations, amendments, acceleration, cancellations, liens, charges, encumbrances and violations as would not, individually or in the aggregate, have a
Material Adverse Effect. The Company is not required under federal, state, local or foreign law, rule or regulation to obtain any consent, authorization or order of, or make any filing or registration with, any court or governmental agency in order
for it to execute, deliver or perform any of its obligations under this Agreement, or to issue and sell the Shares to the Investor in accordance with the terms hereof (other than any filings which may be required to be made by the Company with the
Commission or the Trading Market subsequent to the Effective Date, including but not limited to a Prospectus Supplement under Sections 1.4 and 5.9 of this Agreement, and any registration statement, prospectus or prospectus supplement which has been
or may be filed pursuant to this Agreement). 
  

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 Section 4.6 Commission Documents, Financial Statements. (a) The
Common Stock is registered pursuant to Section 12(b) or 12(g) of the Exchange Act and, except as disclosed in the Commission Documents, as of the Effective Date the Company had timely filed (giving effect to permissible extensions in accordance
with Rule 12b-25 under the Exchange Act) all Commission Documents. The Company has delivered or made available to the Investor via EDGAR or otherwise true and complete copies of the Commission Documents filed with the Commission prior to the
Effective Date (including, without limitation, the 2008 Form 10-K) and has delivered or made available to the Investor via EDGAR or otherwise true and complete copies of all of the Commission Documents heretofore incorporated by reference in the
Registration Statement and the Prospectus. The Company has not provided to the Investor any information which, according to applicable law, rule or regulation, should have been disclosed publicly by the Company but which has not been so disclosed,
other than with respect to the transactions contemplated by this Agreement. As of its filing date, each Commission Document filed with the Commission and incorporated by reference in the Registration Statement and the Prospectus (including, without
limitation, the 2008 Form 10-K) complied in all material respects with the requirements of the Securities Act or the Exchange Act, as applicable, and other federal, state and local laws, rules and regulations applicable to it, and, as of its filing
date (or, if amended or superseded by a filing prior to the Effective Date, on the date of such amended or superseded filing), such Commission Document did not contain any untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. Each Commission Document to be filed with the Commission after the Effective Date and incorporated
by reference in the Registration Statement, the Prospectus and any Prospectus Supplement required to be filed pursuant to Sections 1.4 and 5.9 hereof during the Investment Period (including, without limitation, the Current Report), when such
document becomes effective or is filed with the Commission, as the case may be, shall comply in all material respects with the requirements of the Securities Act or the Exchange Act, as applicable, and other federal, state and local laws, rules and
regulations applicable to it, and shall not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under
which they were made, not misleading. 
 (b) The financial statements, together with the related notes and schedules, of the
Company included in the Commission Documents comply as to form in all material respects with all applicable accounting requirements and the published rules and regulations of the Commission and all other applicable rules and regulations with respect
thereto. Such financial statements, together with the related notes and schedules, have been prepared in accordance with GAAP applied on a consistent basis during the periods involved (except (i) as may be otherwise indicated in such financial
statements or the notes thereto or (ii) in the case of unaudited interim statements, to the extent they may not include footnotes or may be condensed or summary statements and are subject to normal year-end audit adjustments), and fairly
present in all material respects the financial condition of the Company and its consolidated Subsidiaries as of the dates thereof and the results of operations and cash flows for the periods then ended (subject, in the case of unaudited statements,
to normal year-end audit adjustments). 
  

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 (c) The Company has timely filed with the Commission and made available to the Investor via
EDGAR or otherwise all certifications and statements required by (x) Rule 13a-14 or Rule 15d-14 under the Exchange Act or (y) 18 U.S.C. Section 1350 (Section 906 of the Sarbanes-Oxley Act of 2002 (“SOXA”)) with
respect to all relevant Commission Documents. The Company is in compliance in all material respects with the provisions of SOXA applicable to it as of the date hereof. The Company maintains disclosure controls and procedures required by Rule 13a-15
or Rule 15d-15 under the Exchange Act; such controls and procedures are effective to ensure that all material information concerning the Company and its Subsidiaries is made known on a timely basis to the individuals responsible for the timely and
accurate preparation of the Company’s Commission filings and other public disclosure documents. As used in this Section 4.6(c), the term “file” shall be broadly construed to include any manner in which a document or information
is furnished, supplied or otherwise made available to the Commission. 
 (d) Ernst & Young LLP, who have expressed
their opinions on the audited financial statements and related schedules included or incorporated by reference in the Registration Statement and the Base Prospectus are, with respect to the Company, independent public accountants as required by the
Securities Act and is an independent registered public accounting firm within the meaning of SOXA as required by the rules of the Public Company Accounting Oversight Board. 
 Section 4.7 Subsidiaries. The 2008 Form 10-K sets forth each Subsidiary of the Company as of the Effective Date, showing
its jurisdiction of incorporation or organization and the percentage of the Company’s ownership of the outstanding capital stock or other ownership interests of such Subsidiary, and the Company does not have any other Subsidiaries as of the
Effective Date. 
 Section 4.8 No Material Adverse Effect. Since December 31, 2008, the Company has not
experienced or suffered any Material Adverse Effect, and there exists no current state of facts, condition or event which would have a Material Adverse Effect, except (i) as disclosed in any Commission Documents filed since December 31,
2008 or (ii) continued losses from operations. 
 Section 4.9 Indebtedness. The Company’s Quarterly
Report on Form 10-Q for its fiscal quarter ended September 30, 2009 sets forth, as of September 30, 2009, all outstanding secured and unsecured Indebtedness of the Company or any Subsidiary, or for which the Company or any Subsidiary has
commitments through such date. For the purposes of this Agreement, “Indebtedness” shall mean (a) any liabilities for borrowed money or amounts owed in excess of $10,000,000 (other than trade accounts payable incurred in the
ordinary course of business), (b) all guaranties, endorsements, indemnities and other contingent obligations in respect of Indebtedness of others in excess of $10,000,000, whether or not the same are or should be reflected in the Company’s
balance sheet (or the notes thereto), except guaranties by endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business; and (c) the present value of any lease payments in excess of
$10,000,000 due under leases required to be capitalized in accordance with GAAP. There is no existing or continuing default or event of default in respect of any Indebtedness of the Company or any of its Subsidiaries. 
  

 13 

 Section 4.10 Title To Assets. Each of the Company and its Subsidiaries
has good and marketable title to all of their respective real and personal property reflected in the Commission Documents, free of mortgages, pledges, charges, liens, security interests or other encumbrances, except for those indicated in the
Commission Documents or those that would not have a Material Adverse Effect. To the Company’s knowledge, all real property leases of the Company are valid and subsisting and in full force and effect in all material respects. 
 Section 4.11 Actions Pending. There is no action, suit, claim, investigation or proceeding pending, or to the knowledge
of the Company threatened in writing, against the Company or any Subsidiary which questions the validity of this Agreement or the transactions contemplated hereby or any action taken or to be taken pursuant hereto or thereto. Except as set forth in
the Commission Documents, there is no action, suit, claim, investigation or proceeding pending, or to the knowledge of the Company threatened in writing, against or involving the Company, any Subsidiary or any of their respective properties or
assets, or involving any officers or directors of the Company or any of its Subsidiaries, including, without limitation, any securities class action lawsuit or stockholder derivative lawsuit, in each case which, if determined adversely to the
Company, its Subsidiary or any officer or director of the Company or its Subsidiaries, would have a Material Adverse Effect. With respect to each of those certain claims, disputes, investigations, arbitrations, actions or proceedings under the
caption “Item 3. Legal Proceedings” in Part I of the 2008 Form 10-K, there has been no event or change required to be disclosed in a previous filing under the Exchange Act that has not been so disclosed. 
 Section 4.12 Compliance With Law. The business of the Company and the Subsidiaries has been and is presently being
conducted in compliance with all applicable federal, state, local and foreign governmental laws, rules, regulations and ordinances, except as set forth in the Commission Documents and except for such non-compliance which, individually or in the
aggregate, would not have a Material Adverse Effect. 
 Section 4.13 Certain Fees. Except for the placement
fee payable by the Company to Reedland Capital Partners, an Institutional Division of Financial West Group, Member FINRA/SIPC (“Reedland”), which shall be set forth in a separate engagement letter between the Company and Reedland (a
true and complete fully executed copy of which has heretofore been provided to the Investor), no brokers, finders or financial advisory fees or commissions shall be payable by the Company or any Subsidiary (or any of their respective affiliates)
with respect to the transactions contemplated by this Agreement. 
 Section 4.14 Operation of Business.
(a) The Company or one or more of its Subsidiaries possesses such permits, licenses, approvals, consents and other authorizations (including licenses, accreditation and other similar documentation or approvals of any local health departments)
(collectively, “Governmental Licenses”) issued by the appropriate federal, state, local or foreign regulatory agencies or bodies, including, without limitation, the United States Food and Drug Administration
(“FDA”), necessary to conduct the business now operated by it, except where the failure to possess such Governmental Licenses, individually or in the aggregate, would

  

 14 

 
not have a Material Adverse Effect or as otherwise disclosed in the Commission Documents. The Company and its Subsidiaries are in compliance with the terms and conditions of all such Governmental
Licenses and all applicable FDA rules and regulations, guidelines and policies, and all applicable rules and regulations, guidelines and policies of any governmental authority exercising authority comparable to that of the FDA (including any
non-governmental authority whose approval or authorization is required under foreign law comparable to that administered by the FDA), except where the failure to so comply, individually or in the aggregate, would not have a Material Adverse Effect
or as otherwise disclosed in the Commission Documents. All of the Governmental Licenses are valid and in full force and effect, except where the invalidity of such Governmental Licenses or the failure of such Governmental Licenses to be in full
force and effect, individually or in the aggregate, would not have a Material Adverse Effect or as otherwise disclosed in the Commission Documents. As to each product that is subject to FDA regulation or similar legal provisions in any foreign
jurisdiction that is developed, manufactured, tested, packaged, labeled, marketed, sold, distributed and/or commercialized by the Company or any of its Subsidiaries, each such product is being developed, manufactured, tested, packaged, labeled,
marketed, sold, distributed and/or commercialized in compliance with all applicable requirements of the FDA (and any non-governmental authority whose approval or authorization is required under foreign law comparable to that administered by the
FDA), including, but not limited to, those relating to investigational use, investigational device exemption, premarket notification, premarket approval, good clinical practices, good manufacturing practices, record keeping, filing of reports, and
patient privacy and medical record security, except where such non-compliance, individually or in the aggregate, would not have a Material Adverse Effect or as otherwise disclosed in the Commission Documents. As to each product or product candidate
of the Company or any of its Subsidiaries subject to FDA regulation or similar legal provision in any foreign jurisdiction, all manufacturing facilities of the Company and its Subsidiaries are operated in compliance with the FDA’s Quality
System Regulation requirements at 21 C.F.R. Part 820, as applicable, except where such non-compliance, individually or in the aggregate, would not have a Material Adverse Effect. Except as set forth in the Commission Documents or the Registration
Statement, neither the Company nor any of its Subsidiaries has received any notice of proceedings relating to the revocation or modification of any such Governmental Licenses or relating to a potential violation of, failure to comply with, or
request to produce additional information under, any FDA rules and regulations, guidelines or policies which, if the subject of any unfavorable decision, ruling or finding, individually or in the aggregate, would have a Material Adverse Effect or as
otherwise disclosed in the Commission Documents. Except as set forth in the Commission Documents or the Registration Statement, neither the Company nor any of its Subsidiaries has received any correspondence, notice or request from the FDA,
including, without limitation, notice that any one or more products or product candidates of the Company or any of its Subsidiaries failed to receive approval from the FDA for use for any one or more indications. This Section 4.14 does not
relate to environmental matters, such items being the subject of Section 4.15. 
 (b) The Company or one or more of its
Subsidiaries owns or possesses adequate patents, patent rights, licenses, inventions, copyrights, know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures), trademarks,
service marks, trade names, trade dress, logos, copyrights and other intellectual property, including, without limitation, all of the intellectual property described in the Commission Documents as being owned or licensed by

  

 15 

 
the Company (collectively, “Intellectual Property”), necessary to carry on the business now operated by it, except where failure to own, license, or have such rights would not,
individually or in the aggregate, have a Material Adverse Effect. Except as set forth in the Commission Documents, there are no actions, suits or judicial proceedings pending, or to the Company’s knowledge threatened, relating to patents or
proprietary information to which the Company or any of its Subsidiaries is a party or of which any property of the Company or any of its Subsidiaries is subject, and neither the Company nor any of its Subsidiaries has received any notice or is
otherwise aware of any infringement of or conflict with asserted rights of others with respect to any Intellectual Property or of any facts or circumstances which could render any Intellectual Property invalid or inadequate to protect the interest
of the Company and its Subsidiaries therein, and which infringement or conflict (if the subject of any unfavorable decision, ruling or finding) or invalidity or inadequacy, individually or in the aggregate, would have a Material Adverse Effect.

 (c) To the Company’s knowledge, all pre-clinical and clinical trials conducted, supervised or monitored by, or on behalf
of, the Company or any of its Subsidiaries have been conducted in compliance with all applicable federal, state, local and foreign laws, and the regulations and requirements of any applicable governmental entity, including, but not limited to, FDA
good clinical practice and good laboratory practice requirements (or the foreign equivalent requirements) except as set forth in the Commission Documents or as would not likely result in a Material Adverse Effect. Except as set forth in the
Registration Statement or the Commission Documents or as would not likely result in a Material Adverse Effect, neither the Company nor any of its Subsidiaries has received any notices or correspondence from the FDA or any other governmental agency
requiring the termination, suspension, delay or modification of any pre-clinical or clinical trials conducted by, or on behalf of, the Company or any of its Subsidiaries or in which the Company or any of its Subsidiaries has participated that are
described in the Registration Statement or the Commission Documents, if any, or the results of which are referred to in the Registration Statement or the Commission Documents. To the Company’s knowledge, all pre-clinical and clinical trials
previously conducted by, or on behalf of, the Company or any of its Subsidiaries while conducted by or on behalf of the Company or any of its Subsidiaries, were conducted in compliance with all applicable federal, state, local and foreign laws, and
the regulations and requirements of any applicable governmental entity, including, but not limited to, FDA good clinical practice and good laboratory practice requirements (or the foreign equivalent requirements) except as set forth in the
Commission Documents or as would not likely result in a Material Adverse Effect. 
 Section 4.15 Environmental
Compliance. Except as disclosed in the Commission Documents, the Company and each of its Subsidiaries have obtained all material approvals, authorization, certificates, consents, licenses, orders and permits or other similar authorizations
of all governmental authorities, or from any other person, that are required under any Environmental Laws, except for any approvals, authorization, certificates, consents, licenses, orders and permits or other similar authorizations the failure of
which to obtain does not or would not have a Material Adverse Effect. “Environmental Laws” shall mean all applicable laws relating to the protection of the environment including, without limitation, all requirements pertaining to
reporting, licensing, permitting, controlling, investigating or remediating emissions, discharges, releases or threatened releases of hazardous substances, chemical substances,

  

 16 

 
pollutants, contaminants or toxic substances, materials or wastes, whether solid, liquid or gaseous in nature, into the air, surface water, groundwater or land, or relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or handling of hazardous substances, chemical substances, pollutants, contaminants or toxic substances, material or wastes, whether solid, liquid or gaseous in nature. Except for
such instances as would not, individually or in the aggregate, have a Material Adverse Effect, to the Company’s knowledge, there are no past or present events, conditions, circumstances, incidents, actions or omissions relating to or in any way
affecting the Company or its Subsidiaries that violate or would reasonably be expected to violate any Environmental Law after the Effective Date or that would reasonably be expected to give rise to any environmental liability, or otherwise form the
basis of any claim, action, demand, suit, proceeding, hearing, study or investigation (i) under any Environmental Law, or (ii) based on or related to the manufacture, processing, distribution, use, treatment, storage (including without
limitation underground storage tanks), disposal, transport or handling, or the emission, discharge, release or threatened release of any hazardous substance. 
 Section 4.16 Material Agreements. Except as set forth in the Commission Documents, neither the Company nor any Subsidiary of the Company is a party to any written or oral contract,
instrument, agreement, commitment, obligation, plan or arrangement, a copy of which would be required to be filed with the Commission as an exhibit to an annual report on Form 10-K (collectively, “Material Agreements”). Except as
set forth in the Commission Documents, the Company and each of its Subsidiaries have performed in all material respects all the obligations required to be performed by them under the Material Agreements, have received no notice of default or an
event of default by the Company or any of its Subsidiaries thereunder and are not aware of any basis for the assertion thereof, and neither the Company or any of its Subsidiaries nor, to the knowledge of the Company, any other contracting party
thereto are in default under any Material Agreement now in effect, the result of which would have a Material Adverse Effect. Except as set forth in the Commission Documents, each of the Material Agreements is in full force and effect, and
constitutes a legal, valid and binding obligation enforceable in accordance with its terms against the Company and/or any of its Subsidiaries and, to the knowledge of the Company, each other contracting party thereto, except as such enforceability
may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, liquidation, conservatorship, receivership or similar laws relating to, or affecting generally the enforcement of, creditor’s rights and remedies or by other
equitable principles of general application. 
 Section 4.17 Transactions With Affiliates. Except as set
forth in the Commission Documents, there are no loans, leases, agreements, contracts, royalty agreements, management contracts, service arrangements or other continuing transactions exceeding $120,000 between (a) the Company or any Subsidiary,
on the one hand, and (b) any person or entity who would be covered by Item 404(a) of Regulation S-K, on the other hand. Except as disclosed in the Commission Documents, there are no outstanding amounts payable to or receivable from, or
advances by the Company or any of its Subsidiaries to, and neither the Company nor any of its Subsidiaries is otherwise a creditor of or debtor to, any beneficial owner of more than 5% of the outstanding shares of Common Stock, or any director,
employee or affiliate of the Company or any of its Subsidiaries, other than (i) reimbursement for reasonable expenses incurred on behalf of the Company or any of its Subsidiaries or (ii) as part of the normal and customary terms of such
persons’ employment or service as a director with the Company or any of its Subsidiaries. 
  

 17 

 Section 4.18 Securities Act; FINRA Rules. The Company has complied with
all applicable federal and state securities laws in connection with the offer, issuance and sale of the Shares hereunder. 
 (i)
The Company has prepared and filed with the Commission in accordance with the provisions of the Securities Act the Registration Statement, including a base prospectus relating to the Shares. The Registration Statement was declared effective by order
of the Commission on May 20, 2009. As of the date hereof, no stop order suspending the effectiveness of the Registration Statement has been issued by the Commission or is continuing in effect under the Securities Act and no proceedings therefor
are pending before or, to the Company’s knowledge, threatened by the Commission. No order preventing or suspending the use of the Prospectus or any Permitted Free Writing Prospectus has been issued by the Commission. 
 (ii) The Company satisfies all of the requirements for the use of Form S-3 under the Securities Act for the offering and sale of the Shares
contemplated by this Agreement (without reliance on General Instruction I.B.6. of Form S-3). The Commission has not notified the Company of any objection to the use of the form of the Registration Statement pursuant to Rule 401(g)(1) under the
Securities Act. The Registration Statement complied in all material respects on the date on which it was declared effective by the Commission, and will comply in all material respects at each deemed effective date with respect to the Investor and
the offering and sale of Shares under this Agreement pursuant to Rule 430B(f)(2) of the Securities Act, with the requirements of the Securities Act, and the Registration Statement (including the documents incorporated by reference therein) did not
on the date it was declared effective by the Commission, and shall not at each deemed effective date with respect to the Investor and the offering and sale of Shares under this Agreement pursuant to Rule 430B(f)(2) of the Securities Act, 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 not misleading; provided that this representation and warranty does not apply to statements in or
omissions from the Registration Statement made in reliance upon and in conformity with information relating to the Investor furnished to the Company in writing by or on behalf of the Investor expressly for use therein. The Registration Statement, as
of the Effective Date, meets the requirements set forth in Rule 415(a)(1)(x) under the Securities Act. The Base Prospectus complied in all material respects on its date and on the Effective Date, and will comply in all material respects on each
applicable Fixed Request Exercise Date and, when taken together with the applicable Prospectus Supplement and any applicable Permitted Free Writing Prospectus, on each applicable Settlement Date, with the requirements of the Securities Act and did
not on its date and on the Effective Date and shall not on each applicable Fixed Request Exercise Date and, when taken together with the applicable Prospectus Supplement and any applicable Permitted Free Writing Prospectus, on each applicable
Settlement Date 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 the light of the circumstances under which they were made, not misleading;
provided that this representation and warranty does not apply to statements in or omissions from the Base Prospectus made in reliance upon and in conformity with information relating to the Investor furnished to the Company in writing by or
on behalf of the Investor expressly for use therein. 
  

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 (iii) The offering of the Shares pursuant to this Agreement qualifies for the exemption from
the filing requirements of Rule 5110 of the Financial Industry Regulatory Authority (the “FINRA”) afforded by FINRA Rule 5110(b)(7)(C)(i). 
 (iv) Each Prospectus Supplement required to be filed pursuant to Sections 1.4 and 5.9 hereof, when taken together with the Base Prospectus and any applicable Permitted Free Writing Prospectus, on its date
and on the applicable Settlement Date, shall comply in all material respects with the provisions of the Securities Act and shall not on its date and on the applicable Settlement Date 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 the light of the circumstances under which they are made, not misleading, except that this representation and warranty does not apply to statements in or
omissions from any Prospectus Supplement made in reliance upon and in conformity with information relating to the Investor furnished to the Company in writing by or on behalf of the Investor expressly for use therein. 
 (v) At the earliest time after the filing of the Registration Statement that the Company or another offering participant made a bona fide
offer (within the meaning of Rule 164(h)(2) under the Securities Act) relating to the Shares, the Company was not and is not an “ineligible issuer” (as defined in Rule 405 under the Securities Act). Each Permitted Free Writing Prospectus
(a) shall conform in all material respects to the requirements of the Securities Act on the date of its first use, (b) when considered together with the Prospectus on each applicable Fixed Request Exercise Date and on each applicable
Settlement Date, shall 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 the light of the circumstances under which they are made, not
misleading, and (c) shall not include any information that conflicts with the information contained in the Registration Statement, including any document incorporated by reference therein and any Prospectus Supplement deemed to be a part
thereof that has not been superseded or modified. The immediately preceding sentence does not apply to statements in or omissions from any Permitted Free Writing Prospectus made in reliance upon and in conformity with information relating to the
Investor furnished to the Company in writing by or on behalf of the Investor expressly for use therein. 
 (vi) Prior to the
Effective Date, the Company has not distributed any offering material in connection with the offering and sale of the Shares. From and after the Effective Date and prior to the completion of the distribution of the Shares, the Company shall not
distribute any offering material in connection with the offering and sale of the Shares, other than the Registration Statement, the Base Prospectus as supplemented by any Prospectus Supplement or a Permitted Free Writing Prospectus. 
 Section 4.19 Employees. As of the Effective Date, neither the Company nor any Subsidiary of the Company has any
collective bargaining arrangements or agreements covering any of its employees, except as set forth in the Commission Documents. As of the Effective Date, except as disclosed in the Registration Statement or the Commission Documents, no officer,
consultant or key

  

 19 

 
employee of the Company or any Subsidiary whose termination, either individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect, has terminated or, to the
knowledge of the Company, has any present intention of terminating his or her employment or engagement with the Company or any Subsidiary. 
 Section 4.20 Use of Proceeds. The proceeds from the sale of the Shares shall be used by the Company and its Subsidiaries as set forth in the Base Prospectus and any Prospectus
Supplement filed pursuant to Sections 1.4 and 5.9. 
 Section 4.21 Investment Company Act Status. The Company
is not, and as a result of the consummation of the transactions contemplated by this Agreement and the application of the proceeds from the sale of the Shares as set forth in the Base Prospectus and any Prospectus Supplement shall not be, an
“investment company” or a company “controlled” by an “investment company,” within the meaning of the Investment Company Act of 1940, as amended. 
 Section 4.22 ERISA. No liability to the Pension Benefit Guaranty Corporation has been incurred with respect to any Plan
by the Company or any of its Subsidiaries which has had or would have a Material Adverse Effect. No “prohibited transaction” (as defined in Section 406 of ERISA or Section 4975 of the Code) or “accumulated funding
deficiency” (as defined in Section 203 of ERISA) or any of the events set forth in Section 4043(b) of ERISA has occurred with respect to any Plan which has had or would have a Material Adverse Effect, and the execution and delivery of
this Agreement and the issuance and sale of the Shares hereunder shall not result in any of the foregoing events. Each Plan is in compliance in all material respects with applicable law, including ERISA and the Code; the Company has not incurred and
does not expect to incur liability under Title IV of ERISA with respect to the termination of, or withdrawal from, any Plan; and each Plan for which the Company would have any liability that is intended to be qualified under Section 401(a) of
the Code is so qualified in all material respects and nothing has occurred, whether by action or failure to act, which would cause the loss of such qualifications. As used in this Section 4.22, the term “Plan” shall mean an
“employee pension benefit plan” (as defined in Section 3 of ERISA) which is or has been established or maintained, or to which contributions are or have been made, by the Company or any Subsidiary or by any trade or business, whether
or not incorporated, which, together with the Company or any Subsidiary, is under common control, as described in Section 414(b) or (c) of the Code. 
 Section 4.23 Taxes. The Company (i) has filed all necessary federal, state and foreign income and franchise tax returns or has duly requested extensions thereof, except for those
the failure of which to file would not have a Material Adverse Effect, (ii) has paid all federal, state, local and foreign taxes due and payable for which it is liable, except to the extent that any such taxes are being contested in good faith
and by appropriate proceedings, except for such taxes the failure of which to pay would not have a Material Adverse Effect, and (iii) does not have any tax deficiency or claims outstanding or assessed or, to the Company’s knowledge,
proposed against it which would have a Material Adverse Effect. 
 Section 4.24 Insurance. The Company
carries, or is covered by, insurance in such amounts and covering such risks as the Company deems is adequate for the conduct of its and its Subsidiaries’ businesses and the value of their respective properties and as is customary for companies
engaged in similar businesses in similar industries. 
  

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 Section 4.25 Acknowledgement Regarding Investor’s Purchase of
Shares. The Company acknowledges and agrees that the Investor is acting solely in the capacity of an arm’s length purchaser with respect to this Agreement and the transactions contemplated hereunder. The Company further acknowledges
that the Investor is not acting as a financial advisor or fiduciary of the Company (or in any similar capacity) with respect to this Agreement and the transactions contemplated hereunder, and any advice given by the Investor or any of its
representatives or agents in connection with this Agreement and the transactions contemplated hereunder is merely incidental to the Investor’s purchase of the Shares. 
 ARTICLE V 
 COVENANTS 
 The Company covenants with the Investor, and the Investor covenants with the Company, as follows, which covenants of one party are for the
benefit of the other party, during the Investment Period: 
 Section 5.1 Securities Compliance. The Company
shall notify the Commission and the Trading Market, as applicable, in accordance with their respective rules and regulations, of the transactions contemplated by this Agreement, and shall take all necessary action, undertake all proceedings and
obtain all registrations, permits, consents and approvals for the legal and valid issuance of the Shares to the Investor in accordance with the terms of this Agreement. 
 Section 5.2 Registration and Listing. The Company shall take all action necessary to cause the Common Stock to continue to be registered as a class of securities under Sections 12(b) or
12(g) of the Exchange Act, shall comply with its reporting and filing obligations under the Exchange Act, and shall not take any action or file any document (whether or not permitted by the Securities Act) to terminate or suspend such registration
or to terminate or suspend its reporting and filing obligations under the Exchange Act or Securities Act, except as permitted herein. The Company shall take all action necessary to continue the listing and trading of its Common Stock and the listing
of the Shares purchased by Investor hereunder on the Trading Market, and shall comply with the Company’s reporting, filing and other obligations under the bylaws, listed securities maintenance standards and other rules of the Trading Market.

 Section 5.3 Compliance with Laws. 
 (i) The Company shall comply, and cause each Subsidiary to comply, (a) with all laws, rules, regulations and orders applicable to the
business and operations of the Company and its Subsidiaries except as would not have a Material Adverse Effect and (b) with all applicable provisions of the Securities Act, the Exchange Act and the listing standards of the Trading Market.
Without limiting the generality of the foregoing, neither the Company nor any of its officers, directors or affiliates has taken or will take, directly or indirectly, any action designed or intended to stabilize or manipulate the price of any
security of the Company, or which caused or resulted in, or which would in the future reasonably be expected to cause or result in, stabilization or manipulation of the price of any security of the Company. 
  

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 (ii) The Investor shall comply with all laws, rules, regulations and orders applicable to
the performance by it of its obligations under this Agreement and its investment in the Shares, except as would not, individually or in the aggregate, prohibit or otherwise interfere with the ability of the Investor to enter into and perform its
obligations under this Agreement in any material respect. Without limiting the foregoing, the Investor shall comply with all applicable provisions of the Securities Act and the Exchange Act. 
 Section 5.4 Keeping of Records and Books of Account; Foreign Corrupt Practices Act. 
 (i) The Company shall keep and cause each Subsidiary to keep adequate records and books of account, in which complete entries shall be made
in accordance with GAAP consistently applied, reflecting all financial transactions of the Company and its Subsidiaries, and in which, for each fiscal year, all proper reserves for depreciation, depletion, obsolescence, amortization, taxes, bad
debts and other purposes in connection with its business shall be made. The Company shall maintain a system of internal accounting controls that (a) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect
the transactions and dispositions of the assets of the Company; (b) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting
principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (c) provide reasonable assurance regarding prevention or timely detection of
unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the Company’s financial statements. 
 (ii) Neither the Company, nor any of its Subsidiaries, nor to the knowledge of the Company, any of their respective directors, officers, agents, employees or any other persons acting on their behalf
shall, in connection with the operation of the Company’s and its Subsidiaries’ respective businesses, (a) use any corporate funds for unlawful contributions, payments, gifts or entertainment or to make any unlawful expenditures
relating to political activity to government officials, candidates or members of political parties or organizations, (b) pay, accept or receive any unlawful contributions, payments, expenditures or gifts, or (c) violate or operate in
noncompliance with any export restrictions, anti-boycott regulations, embargo regulations or other applicable domestic or foreign laws and regulations, except for such violations or noncompliant operations that would not likely result in a Material
Adverse Effect. 
 (iii) Subject to the requirements of Section 5.12 of this Agreement, from time to time from and after
the period beginning with the third Trading Day immediately preceding each Fixed Request Exercise Date through and including the applicable Settlement Date, the Company shall make available for inspection and review by the Investor, customary
documentation allowing the Investor and/or its appointed counsel or advisors to conduct due diligence. 
  

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 Section 5.5 Limitations on Holdings and Issuances. The Company shall not
be obligated to issue and the Investor shall not be obligated to purchase any shares of Common Stock which, when aggregated with all other shares of Common Stock then owned beneficially by the Investor, would result in the beneficial ownership by
the Investor of more than 9.9% of the then issued and outstanding shares of Common Stock. 
 Section 5.6 Other
Agreements and Other Financings. 
 (i) The Company shall not enter into, announce or recommend to its
stockholders any agreement, plan, arrangement or transaction in or of which the terms thereof would restrict, materially delay, conflict with or impair the ability or right of the Company or any Subsidiary to perform its obligations under this
Agreement, including, without limitation, the obligation of the Company to deliver Shares to the Investor in respect of a Fixed Request or Optional Amount on the applicable Settlement Date. 
 (ii) The Company shall notify the Investor, within 48 hours, if it enters into any agreement, plan, arrangement or transaction with a third
party, the principal purpose of which is to obtain during a Pricing Period an Other Financing not constituting an Acceptable Financing (an “Other Financing Notice”); provided, however, that the Company shall notify the
Investor promptly (but in no event later than 24 hours) (an “Integration Notice”) if it enters into any agreement, plan, arrangement or transaction with a third party, the principal purpose of which is to obtain at any time during
the Investment Period an Other Financing that would be aggregated with the transactions contemplated by this Agreement for purposes of determining whether approval of the Company’s stockholders is required under any bylaw, listed securities
maintenance standards or other rules of the Trading Market and, if required under applicable law, including, without limitation, Regulation FD promulgated by the Commission, or under the applicable rules and regulations of the Trading Market, the
Company shall publicly disclose such information in accordance with Regulation FD and the applicable rules and regulations of the Trading Market. For purposes of this Section 5.6(ii), any press release issued by, or Commission Document filed
by, the Company shall constitute sufficient notice, provided that it is issued or filed, as the case may be, within the time requirements set forth in the first sentence of this Section 5.6(ii) for an Other Financing Notice or an
Integration Notice, as applicable. For greater certainty, the entry by the Company into any agreement, plan, arrangement or transaction with a third party to obtain an Other Financing (or any other financing) outside of a Pricing Period shall not
trigger any requirement for the Company to deliver an Other Financing Notice (it being acknowledged and agreed that nothing contained in this Section 5.6(ii) shall limit or modify in any respect the Company’s obligations in
Section 7.2). During any Pricing Period in which the Company is required to provide an Other Financing Notice pursuant to the first sentence of this Section 5.6(ii), the Investor shall (i) have the option to purchase the Shares
subject to the Fixed Request at (x) the price therefor in accordance with the terms of this Agreement or (y) the third party’s per share purchase price in connection with the Other Financing, net of such third party’s discounts,
Warrant Value and fees, or (ii) the Investor may elect to not purchase any Shares subject to the Fixed Request for that Pricing Period. An “Other Financing” shall mean (x) the issuance of Common Stock for a purchase price
less than, or the issuance of securities convertible into or exchangeable for Common Stock at an exercise or conversion price (as the case may be) less than, the then Current Market Price of the Common Stock (in each case, after all fees, discounts,
Warrant Value and commissions associated with the

  

 23 

 
transaction) (a “Below Market Offering”); (y) the implementation by the Company of any mechanism in respect of any securities convertible into or exchangeable for Common
Stock for the reset of the purchase price of the Common Stock to below the then Current Market Price of the Common Stock (including, without limitation, any antidilution or similar adjustment provisions in respect of any Company securities, but
specifically excluding customary adjustments for stock splits, stock dividends, stock combinations and similar events); or (z) the issuance of options, warrants or similar rights of subscription, in each case above not constituting an
Acceptable Financing. “Acceptable Financing” shall mean the issuance by the Company of: (1) shares of Common Stock or securities convertible into or exercisable or exchangeable for Common Stock other than in connection with a
Below Market Offering; (2) shares of Common Stock or securities convertible into or exercisable or exchangeable for Common Stock in connection with awards under the Company’s benefit and equity plans and arrangements or pursuant to
consulting or other vendor agreements and the issuance of shares of Common Stock upon the conversion, exercise or exchange thereof; (3) shares of Common Stock issuable upon the conversion, exercise or exchange of equity awards or exercisable,
convertible or exchangeable securities outstanding as of the Effective Date; (4) shares of Common Stock or securities convertible into or exercisable or exchangeable for Common Stock or similar rights to subscribe for the purchase of shares of
Common Stock in connection with technology sharing, licensing, research and joint development agreements (or amendments thereto) with third parties, and the issuance of shares of Common Stock upon the conversion, exercise or exchange thereof; and
(5) shares of Common Stock and/or warrants or similar rights to subscribe for the purchase of shares of Common Stock issued in connection with equipment financings and/or real property leasing arrangements and the issuance of shares of Common
Stock upon the exercise thereof. 
 Section 5.7 Stop Orders. The Company shall advise the Investor promptly
(but in no event later than 24 hours) and shall confirm such advice in writing: (i) of the Company’s receipt of notice of any request by the Commission for amendment of or a supplement to the Registration Statement, the Prospectus, any
Permitted Free Writing Prospectus or for any additional information; (ii) of the Company’s receipt of notice of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or prohibiting or
suspending the use of the Prospectus or any Prospectus Supplement, or of the suspension of qualification of the Shares for offering or sale in any jurisdiction, or the initiation or contemplated initiation of any proceeding for such purpose; and
(iii) of the Company becoming aware of the happening of any event, which makes any statement of a material fact made in the Registration Statement, the Prospectus or any Permitted Free Writing Prospectus untrue or which requires the making of
any additions to or changes to the statements then made in the Registration Statement, the Prospectus or any Permitted Free Writing Prospectus in order to state a material fact required by the Securities Act to be stated therein or necessary in
order to make the statements then made therein (in the case of the Prospectus, in light of the circumstances under which they were made) not misleading, or of the necessity to amend the Registration Statement or supplement the Prospectus or any
Permitted Free Writing Prospectus to comply with the Securities Act or any other law. The Company shall not be required to disclose to the Investor the substance or specific reasons of any of the events set forth in clauses (i) through
(iii) of the immediately preceding sentence, but rather, shall only be required to disclose that the event has occurred. The Company shall not issue any Fixed Request during the

  

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continuation of any of the foregoing events. If at any time the Commission shall issue any stop order suspending the effectiveness of the Registration Statement or prohibiting or suspending the
use of the Prospectus or any Prospectus Supplement, the Company shall use commercially reasonable efforts to obtain the withdrawal of such order at the earliest possible time. 
 Section 5.8 Amendments to the Registration Statement; Prospectus Supplements; Free Writing Prospectuses.

 (i) Except as provided in this Agreement and other than periodic reports required to be filed pursuant to the Exchange
Act, the Company shall not file with the Commission any amendment to the Registration Statement that relates to the Investor, the Agreement or the transactions contemplated hereby or file with the Commission any Prospectus Supplement that relates to
the Investor, this Agreement or the transactions contemplated hereby with respect to which (a) the Investor shall not previously have been advised, (b) the Company shall not have given due consideration to any comments thereon received
from the Investor or its counsel, or (c) the Investor shall reasonably object after being so advised, unless the Company has determined in good faith that it is necessary to amend the Registration Statement or make any supplement to the
Prospectus to comply with the Securities Act or any other applicable law or regulation, in which case the Company shall promptly (but in no event later than 24 hours) so inform the Investor, the Investor shall be provided with a reasonable
opportunity to review and comment upon any disclosure relating to the Investor and the Company shall expeditiously furnish to the Investor an electronic copy thereof. In addition, for so long as, in the reasonable opinion of counsel for the
Investor, the Prospectus (or in lieu thereof, the notice referred to in Rule 173(a) under the Securities Act) is required to be delivered in connection with any purchase of Shares by the Investor, the Company shall not file any Prospectus Supplement
with respect to the Shares without delivering or making available a copy of such Prospectus Supplement, together with the Base Prospectus, to the Investor promptly. 
 (ii) The Company has not made, and agrees that unless it obtains the prior written consent of the Investor it will not make, an offer relating to the Shares that would constitute an Issuer Free Writing
Prospectus or that would otherwise constitute a Free Writing Prospectus required to be filed by the Company or the Investor with the Commission or retained by the Company or the Investor under Rule 433 under the Securities Act. The Investor has not
made, and agrees that unless it obtains the prior written consent of the Company it will not make, an offer relating to the Shares that would constitute a Free Writing Prospectus required to be filed by the Company with the Commission or retained by
the Company under Rule 433 under the Securities Act. Any such Issuer Free Writing Prospectus or other Free Writing Prospectus consented to by the Investor or the Company is referred to in this Agreement as a “Permitted Free Writing
Prospectus.” The Company agrees that (x) it has treated and will treat, as the case may be, each Permitted Free Writing Prospectus as an Issuer Free Writing Prospectus and (y) it has complied and will comply, as the case may be,
with the requirements of Rules 164 and 433 under the Securities Act applicable to any Permitted Free Writing Prospectus, including in respect of timely filing with the Commission, legending and record keeping. 
  

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 Section 5.9 Prospectus Delivery. The Company shall file with the
Commission a Prospectus Supplement pursuant to Rule 424(b) under the Securities Act on the first Trading Day immediately following the last Trading Day of each Pricing Period. The Company shall provide the Investor a reasonable opportunity to
comment on a draft of each such Prospectus Supplement and any Issuer Free Writing Prospectus, shall give due consideration to all such comments and, subject to the provisions of Section 5.8 hereof, shall deliver or make available to the
Investor, without charge, an electronic copy of each form of Prospectus Supplement, together with the Base Prospectus, and any Permitted Free Writing Prospectus on each applicable Settlement Date. The Company consents to the use of the Prospectus
(and of any Prospectus Supplement thereto) in accordance with the provisions of the Securities Act and with the securities or “blue sky” laws of the jurisdictions in which the Shares may be sold by the Investor, in connection with the
offering and sale of the Shares and for such period of time thereafter as the Prospectus (or in lieu thereof, the notice referred to in Rule 173(a) under the Securities Act) is required by the Securities Act to be delivered in connection with sales
of the Shares. If during such period of time any event shall occur that in the judgment of the Company and its counsel is required to be set forth in the Registration Statement or the Prospectus or any Permitted Free Writing Prospectus or should be
set forth therein in order to make the statements made therein (in the case of the Prospectus, in light of the circumstances under which they were made) not misleading, or if it is necessary to amend the Registration Statement or supplement or amend
the Prospectus or any Permitted Free Writing Prospectus to comply with the Securities Act or any other applicable law or regulation, the Company shall forthwith prepare and, subject to Section 5.8 above, file with the Commission an appropriate
amendment to the Registration Statement or Prospectus Supplement to the Prospectus (or supplement to the Permitted Free Writing Prospectus) and shall expeditiously furnish or make available to the Investor an electronic copy thereof. 
 Section 5.10 Selling Restrictions. 
 (i) The Investor covenants that from and after the date hereof through and including the 90th day next following the termination of this Agreement (the
“Restricted Period”), neither the Investor nor any of its affiliates (within the meaning of the Exchange Act) nor any entity managed or controlled by the Investor shall, directly or indirectly, sell any securities of the Company,
except the Shares that it owns or has the right to purchase as provided in a Fixed Request Notice. During the Restricted Period, neither the Investor or any of its affiliates nor any entity managed or controlled by the Investor shall sell any shares
of Common Stock of the Company it does not “own” or have the unconditional right to receive under the terms of this Agreement (within the meaning of Rule 200 of Regulation SHO promulgated by the Commission under the Exchange Act),
including Shares in any account of the Investor or in any account directly or indirectly managed or controlled by the Investor or any of its affiliates or any entity managed or controlled by the Investor. Without limiting the generality of the
foregoing, prior to and during the Restricted Period, neither the Investor nor any of its affiliates nor any entity managed or controlled by the Investor or any of its affiliates shall enter into a short position with respect to shares of Common
Stock of the Company, including in any account of the Investor’s or in any account directly or indirectly managed or controlled by the Investor or any of its affiliates or any entity managed or controlled by the Investor or any of its
affiliates, except that the Investor may sell Shares that it is obligated to purchase under a pending Fixed Request Notice but has not yet taken possession of so long as the Investor (or the Broker-Dealer, as applicable) covers any such sales with
the Shares purchased pursuant to such Fixed Request Notice; provided, however, that the Investor (or the Broker-Dealer, as applicable) shall not

  

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be required to cover any such sales with the Shares purchased pursuant to such Fixed Request Notice if (a) the Fixed Request is terminated by mutual agreement of the Company and the Investor
and, as a result of such termination, no Shares are delivered to the Investor under this Agreement or (b) the Company otherwise fails to deliver such Shares to the Investor on the applicable Settlement Date upon the terms and subject to the
provisions of this Agreement. Prior to and during the Restricted Period, the Investor shall not grant any option to purchase or acquire any right to dispose or otherwise dispose for value of any shares of Common Stock or any securities convertible
into or exercisable or exchangeable for, or warrants to purchase, any shares of Common Stock, or enter into any swap, hedge or other agreement that transfers, in whole or in part, the economic risk of ownership of the Common Stock, except for such
sales expressly permitted by this Section 5.10(i). 
 (ii) In addition to the foregoing, in connection with any sale of the
Company’s securities (including any sale permitted by paragraph (i) above), the Investor shall comply in all respects with all applicable laws, rules, regulations and orders, including, without limitation, the requirements of the
Securities Act and the Exchange Act. 
 Section 5.11 Effective Registration Statement. During the Investment
Period, the Company shall use its best efforts to maintain the continuous effectiveness of the Registration Statement under the Securities Act. 
 Section 5.12 Non-Public Information. Neither the Company nor any of its directors, officers or agents shall disclose any material non-public information about the Company to the
Investor, unless a timely public announcement thereof is made by the Company in the manner contemplated by Regulation FD. 
 Section 5.13 Broker/Dealer. The Investor shall use one or more broker-dealers to effectuate all sales, if any, of the Shares that it may purchase from the Company pursuant to this Agreement which (or whom) shall be
unaffiliated with the Investor and not then currently engaged or used by the Company (collectively, the “Broker-Dealer”). The Investor shall provide the Company with all information regarding the Broker-Dealer reasonably requested
by the Company. The Investor shall be solely responsible for all fees and commissions of the Broker-Dealer. 
 Section 5.14 Disclosure Schedule. 
 (i) During the Investment Period, the Company shall from
time to time update the Disclosure Schedule as may be required to satisfy the condition set forth in Section 6.3(i). For purposes of this Section 5.14, any disclosure made in a schedule to the Compliance Certificate substantially in the
form attached hereto as Exhibit D shall be deemed to be an update of the Disclosure Schedule. Notwithstanding anything in this Agreement to the contrary, no update to the Disclosure Schedule pursuant to this Section 5.14 shall cure any
breach of a representation or warranty of the Company contained in this Agreement and shall not affect any of the Investor’s rights or remedies with respect thereto. 
  

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 (ii) Notwithstanding anything to the contrary contained in the Disclosure Schedules or in
this Agreement, the information and disclosure contained in any Schedule of the Disclosure Schedules shall be deemed to be disclosed and incorporated by reference in any other Schedule of the Disclosure Schedules as though fully set forth in such
Schedule for which applicability of such information and disclosure is readily apparent on its face. The fact that any item of information is disclosed in the Disclosure Schedules shall not be construed to mean that such information is required to
be disclosed by this Agreement. Except as expressly set forth in this Agreement, such information and the thresholds (whether based on quantity, qualitative characterization, dollar amounts or otherwise) set forth herein shall not be used as a basis
for interpreting the terms “material” or “Material Adverse Effect” or other similar terms in this Agreement. 
 ARTICLE VI 
 OPINION OF COUNSEL AND CERTIFICATE; CONDITIONS TO THE SALE AND 
 PURCHASE OF THE SHARES 
 Section 6.1 Opinion of Counsel and Certificate. Simultaneously with the execution and delivery of this Agreement, the Investor has received (i) an opinion of outside counsel to the
Company, dated the Effective Date, in the form mutually agreed to by the parties hereto, and (ii) a certificate from the Company, dated the Effective Date, in the form of Exhibit C hereto. 
 Section 6.2 Conditions Precedent to the Obligation of the Company. The obligation hereunder of the Company to issue and
sell the Shares to the Investor under any Fixed Request or Optional Amount is subject to the satisfaction or (to the extent permitted by applicable law) waiver of each of the conditions set forth below. These conditions are for the Company’s
sole benefit and (to the extent permitted by applicable law) may be waived by the Company at any time in its sole discretion. 
 (i) Accuracy of the Investor’s Representations and Warranties. The representations and warranties of the Investor contained in this Agreement (a) that are not qualified by “materiality” shall have been true
and correct in all material respects when made and shall be true and correct in all material respects as of the applicable Fixed Request Exercise Date and the applicable Settlement Date with the same force and effect as if made on such dates, except
to the extent such representations and warranties are as of another date, in which case, such representations and warranties shall be true and correct in all material respects as of such other date and (b) that are qualified by
“materiality” shall have been true and correct when made and shall be true and correct as of the applicable Fixed Request Exercise Date and the applicable Settlement Date with the same force and effect as if made on such dates, except to
the extent such representations and warranties are as of another date, in which case, such representations and warranties shall be true and correct as of such other date. 
 (ii) Registration Statement. The Registration Statement is effective and neither the Company nor the Investor shall have received notice that the Commission has issued or intends to issue a
stop order with respect to the Registration Statement. The Company shall have a maximum dollar amount certain of Shares registered under the Registration Statement which are in an amount (a) as of the Effective Date, not less than the Total
Commitment and (b) as of the applicable Fixed Request Exercise Date, not less

  

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than the maximum dollar amount worth of Shares issuable pursuant to the applicable Fixed Request Notice and applicable Optional Amount, if any. The Current Report shall have been filed with the
Commission, as required pursuant to Section 1.4, and all Prospectus Supplements shall have been filed with the Commission, as required pursuant to Sections 1.4 and 5.9 hereof, to disclose the sale of the Shares prior to each Settlement Date, as
applicable. Any other material required to be filed by the Company or any other offering participant pursuant to Rule 433(d) under the Securities Act shall have been filed with the Commission within the applicable time periods prescribed for such
filings by Rule 433 under the Securities Act. 
 (iii) Performance by the Investor. The Investor shall have
performed, satisfied and complied in all material respects with all covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Investor at or prior to the applicable Fixed Request Exercise Date
and the applicable Settlement Date. 
 (iv) No Injunction. No statute, regulation, order, decree, writ, ruling or
injunction shall have been enacted, entered, promulgated, threatened or endorsed by any court or governmental authority of competent jurisdiction which prohibits the consummation of or which would materially modify or delay any of the transactions
contemplated by this Agreement. 
 (v) No Suspension, Etc. Trading in the Common Stock shall not have been
suspended by the Commission or the Trading Market (except for any suspension of trading of limited duration agreed to by the Company, which suspension shall be terminated prior to the applicable Fixed Request Exercise Date and applicable Settlement
Date), and, at any time prior to the applicable Fixed Request Exercise Date and applicable Settlement Date, none of the events described in clauses (i), (ii) and (iii) of Section 5.7 shall have occurred, trading in securities
generally as reported on the Trading Market shall not have been suspended or limited, nor shall a banking moratorium have been declared either by the United States or New York State authorities, nor shall there have occurred any material outbreak or
escalation of hostilities or other national or international calamity or crisis of such magnitude in its effect on, or any material adverse change in, any financial, credit or securities market which, in each case, in the reasonable judgment of the
Company, makes it impracticable or inadvisable to issue the Shares. 
 (vi) No Proceedings or Litigation.
No action, suit or proceeding before any arbitrator or any court or governmental authority shall have been commenced or threatened, and no inquiry or investigation by any governmental authority shall have been commenced or threatened, against the
Company or any Subsidiary, or any of the officers, directors or affiliates of the Company or any Subsidiary, seeking to restrain, prevent or change the transactions contemplated by this Agreement, or seeking damages in connection with such
transactions. 
 (vii) Aggregate Limit. The issuance and sale of the Shares issuable pursuant to such Fixed
Request Notice or Optional Amount shall not violate Sections 2.2, 2.12 and 5.5 hereof. 
  

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 Section 6.3 Conditions Precedent to the Obligation of the Investor. The
obligation hereunder of the Investor to accept a Fixed Request Notice or Optional Amount grant and to acquire and pay for the Shares is subject to the satisfaction or (to the extent permitted by applicable law) waiver, at or before each Fixed
Request Exercise Date and each Settlement Date, of each of the conditions set forth below. These conditions are for the Investor’s sole benefit and (to the extent permitted by applicable law) may be waived by the Investor at any time in its
sole discretion. 
 (i) Accuracy of the Company’s Representations and Warranties. The representations and
warranties of the Company contained in this Agreement (a) that are not qualified by “materiality” or “Material Adverse Effect” shall have been true and correct in all material respects when made and shall be true and correct
in all material respects as of the applicable Fixed Request Exercise Date and the applicable Settlement Date with the same force and effect as if made on such dates, except to the extent such representations and warranties are as of another date, in
which case, such representations and warranties shall be true and correct in all material respects as of such other date and (b) that are qualified by “materiality” or “Material Adverse Effect” shall have been true and
correct when made and shall be true and correct as of the applicable Fixed Request Exercise Date and the applicable Settlement Date with the same force and effect as if made on such dates, except to the extent such representations and warranties are
as of another date, in which case, such representations and warranties shall be true and correct as of such other date. 
 (ii)
Registration Statement. The Registration Statement is effective and neither the Company nor the Investor shall have received notice that the Commission has issued or intends to issue a stop order with respect to the Registration
Statement. The Company shall have a maximum dollar amount certain of Shares registered under the Registration Statement which are in an amount (a) as of the Effective Date, not less than the Total Commitment and (b) as of the applicable
Fixed Request Exercise Date, not less than the maximum dollar amount worth of Shares issuable pursuant to the applicable Fixed Request Notice and applicable Optional Amount, if any. The Current Report shall have been filed with the Commission, as
required pursuant to Section 1.4, and all Prospectus Supplements shall have been filed with the Commission, as required pursuant to Sections 1.4 and 5.9 hereof, to disclose the sale of the Shares prior to each Settlement Date, as applicable,
and an electronic copy of each such Prospectus Supplement together with the Base Prospectus shall have been delivered or made available to the Investor in accordance with Section 5.9 hereof. Any other material required to be filed by the
Company or any other offering participant pursuant to Rule 433(d) under the Securities Act shall have been filed with the Commission within the applicable time periods prescribed for such filings by Rule 433 under the Securities Act. 
 (iii) No Suspension. Trading in the Common Stock shall not have been suspended by the Commission or the Trading Market (except
for any suspension of trading of limited duration agreed to by the Company, which suspension shall be terminated prior to the applicable Fixed Request Exercise Date and applicable Settlement Date), and the Company shall not have received any notice
that the listing or quotation of the Common Stock on the Trading Market shall be terminated on a date certain. At any time prior to the applicable Fixed Request Exercise Date and applicable Settlement Date, none of the events described in clauses
(i), (ii) and (iii) of Section 5.7 shall have occurred, trading in securities generally as reported on the Trading Market shall not have been suspended or limited, nor shall a banking moratorium have been declared either by the United
States or New York State authorities,

  

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nor shall there have occurred any material outbreak or escalation of hostilities or other national or international calamity or crisis of such magnitude in its effect on, or any material adverse
change in, any financial, credit or securities market which, in each case, in the reasonable judgment of the Investor, makes it impracticable or inadvisable to purchase the Shares. 
 (iv) Performance of the Company. The Company shall have performed, satisfied and complied in all material respects with all
covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Company at or prior to the applicable Fixed Request Exercise Date and the applicable Settlement Date and shall have delivered to the
Investor on the applicable Settlement Date the Compliance Certificate substantially in the form attached hereto as Exhibit D. 
 (v) No Injunction. No statute, rule, regulation, order, decree, writ, ruling or injunction shall have been enacted, entered, promulgated, threatened or endorsed by any court or governmental authority of competent jurisdiction
which prohibits the consummation of or which would materially modify or delay any of the transactions contemplated by this Agreement. 
 (vi) No Proceedings or Litigation. No action, suit or proceeding before any arbitrator or any court or governmental authority shall have been commenced or threatened, and no inquiry or investigation by any governmental
authority shall have been commenced or threatened, against the Company or any Subsidiary, or any of the officers, directors or affiliates of the Company or any Subsidiary, seeking to restrain, prevent or change the transactions contemplated by this
Agreement, or seeking damages in connection with such transactions. 
 (vii) Aggregate Limit. The issuance and
sale of the Shares issuable pursuant to such Fixed Request Notice or Optional Amount shall not violate Sections 2.2, 2.12 and 5.5 hereof. 
 (viii) Shares Authorized. The Shares issuable pursuant to such Fixed Request Notice or Optional Amount shall have been duly authorized by all necessary corporate action of the
Company. 
 (ix) Listing of Shares. The Company shall have submitted to the Trading Market, at or prior to
the applicable Fixed Request Exercise Date, a notification form of listing of additional shares related to the Shares issuable pursuant to such Fixed Request and Optional Amount, in accordance with the bylaws, listed securities maintenance standards
and other rules of the Trading Market and, prior to the applicable Settlement Date, such Shares shall have been approved for listing or quotation on the Trading Market, subject only to notice of issuance. 
 (x) Opinions of Counsel; Bring-Down. Subsequent to the filing of the Current Report pursuant to Section 1.4 and prior to
the first Fixed Request Exercise Date, the Investor shall have received an opinion from outside counsel to the Company in the form mutually agreed to by the parties hereto. On each Settlement Date, the Investor shall have received an opinion
“bring down” from outside counsel to the Company in the form mutually agreed to by the parties hereto. 
  

 31 

 (xi) Payment of Investor’s Counsel Fees; Due Diligence
Expenses. On the Effective Date, the Company shall have paid by wire transfer of immediately available funds to an account designated by the Investor’s counsel, the fees and expenses of the Investor’s counsel in accordance with the
proviso to the first sentence of Section 9.1(i) of this Agreement. On the 30th day of the third month in each calendar quarter during the Investment Period, the Company shall have paid by wire transfer of immediately available funds to an account designated by the Investor, the due
diligence expenses incurred by the Investor in accordance with the provisions of the second sentence of Section 9.1(i) of this Agreement. 
 ARTICLE VII 
 TERMINATION 
 Section 7.1 Term, Termination by Mutual Consent. Unless earlier terminated as provided hereunder, this Agreement shall
terminate automatically on the earliest of (i) the first day of the month next following the 24-month anniversary of the Effective Date (the “Investment Period”), (ii) the date that the entire dollar amount of Shares
registered under the Registration Statement have been issued and sold and (iii) the date the Investor shall have purchased the Total Commitment of shares of Common Stock (subject in all cases to the Trading Market Limit). Subject to
Section 7.3, this Agreement may be terminated at any time by the mutual written consent of the parties, effective as of the date of such mutual written consent unless otherwise provided in such written consent, it being hereby acknowledged and
agreed that the Investor may not consent to such termination during a Pricing Period or prior to a Settlement Date in the event the Investor has instructed the Broker-Dealer to effect an open-market sale of Shares which are subject to a pending
Fixed Request Notice but which have not yet been physically delivered by the Company (and/or credited by book-entry) to the Investor in accordance with the terms and subject to the conditions of this Agreement. Subject to Section 7.3, the
Company may terminate this Agreement effective upon three Trading Days’ prior written notice to the Investor delivered in accordance with Section 9.4; provided, however, that (i) such termination shall not occur during a
Pricing Period or, subsequent to the issuance of a Fixed Request Notice, prior to the Settlement Date related to such Fixed Request Notice and (ii) prior to issuing any press release, or making any public statement or announcement, with respect
to such termination, the Company shall consult with the Investor and shall obtain the Investor’s consent to the form and substance of such press release or other disclosure, which consent shall not be unreasonably delayed or withheld.

 Section 7.2 Other Termination. If the Company provides the Investor with an Other Financing Notice (other
than in respect of an underwritten public offering of securities of the Company, a registered direct public offering of securities of the Company, a direct sale of securities of the Company to an underwriter or underwriters, a private investment in
public equity (PIPE) transaction involving securities of the Company or any similar financing, in each case including Below Market Offerings, provided in each case the price per share of such securities is fixed concurrently with the execution of
definitive agreements relating to such transaction) or an Integration Notice, in each case pursuant to Section 5.6(ii) of this Agreement, or if the Company otherwise enters into any agreement, plan, arrangement or transaction with a third
party, the principal purpose of which is to obtain outside a Pricing Period, but otherwise during the Investment Period, an Other Financing not constituting an Acceptable Financing (other than in respect of an underwritten

  

 32 

 
public offering of securities of the Company, a registered direct public offering of securities of the Company, a direct sale of securities of the Company to an underwriter or underwriters, a
private investment in public equity (PIPE) transaction involving securities of the Company or any similar financing, in each case including Below Market Offerings, provided in each case the price per share of such securities is fixed concurrently
with the execution of definitive agreements relating to such transaction), in which latter case the Company shall so notify the Investor within 48 hours thereof, then in all such cases the Investor shall have the right to terminate this Agreement
within the subsequent 30-day period (the “Event Period”), effective upon one Trading Day’s prior written notice delivered to the Company in accordance with Section 9.4 at any time during the Event Period. The Company shall
promptly (but in no event less than 24 hours) notify the Investor (and, if required under applicable law, including, without limitation, Regulation FD promulgated by the Commission, or under the applicable rules and regulations of the Trading
Market, the Company shall publicly disclose such information in accordance with Regulation FD and the applicable rules and regulations of the Trading Market), and the Investor shall have the right to terminate this Agreement at any time after
receipt of such notification, if: (i) any condition, occurrence, state of facts or event constituting a Material Adverse Effect has occurred; (ii) a Material Change in Ownership has occurred or the Company enters into a definitive
agreement providing for a Material Change in Ownership; or (iii) a default or event of default has occurred and is continuing under the terms of any agreement, contract, note or other instrument to which the Company or any of its Subsidiaries
is a party with respect to any indebtedness for borrowed money representing more than 10% of the Company’s consolidated assets, in any such case, upon one Trading Day’s prior written notice delivered to the Company in accordance with
Section 9.4 hereof. 
 Section 7.3 Effect of Termination. In the event of termination by the Company or
the Investor pursuant to Section 7.1 or 7.2, as applicable, written notice thereof shall forthwith be given to the other party as provided in Section 9.4 and the transactions contemplated by this Agreement shall be terminated without
further action by either party. If this Agreement is terminated as provided in Section 7.1 or 7.2 herein, this Agreement shall become void and of no further force and effect, except that the provisions of Article VIII (Indemnification),
Section 9.1 (Fees and Expenses), Section 9.2 (Specific Enforcement, Consent to Jurisdiction, Waiver of Jury Trial), Section 9.4 (Notices), Section 9.8 (Governing Law), Section 9.9 (Survival), Section 9.11 (Publicity),
Section 9.12 (Severability) and this Article VII (Termination) shall remain in full force and effect notwithstanding such termination. Nothing in this Section 7.3 shall be deemed to release the Company or the Investor from any liability
for any breach under this Agreement, or to impair the rights of the Company and the Investor to compel specific performance by the other party of its obligations under this Agreement. 
 ARTICLE VIII 
 INDEMNIFICATION 
 Section 8.1 General Indemnity. 
 (i) Indemnification by the Company. The Company shall indemnify and hold harmless the Investor, each affiliate, employee, representative and advisor of and to the Investor, and each
person, if any, who controls the Investor within the meaning of

  

 33 

 
Section 15 of the Securities Act or Section 20(a) of the Exchange Act from and against all losses, claims, damages, liabilities and expenses (including reasonable costs of defense and
investigation and all attorneys’ fees) to which the Investor and each such other person may become subject, under the Securities Act or otherwise, insofar as such losses, claims, damages, liabilities and expenses (or actions in respect thereof)
arise out of or are based upon (a) any violation of United States federal or state securities laws in connection with the transactions contemplated by this Agreement by the Company or any of its Subsidiaries, affiliates, officers, directors or
employees, (b) any untrue statement or alleged untrue statement of a material fact contained, or incorporated by reference, in the Registration Statement or any amendment thereto or any omission or alleged omission to state therein, or in any
document incorporated by reference therein, a material fact required to be stated therein or necessary to make the statements therein not misleading, or (c) any untrue statement or alleged untrue statement of a material fact contained, or
incorporated by reference, in the Prospectus, any Issuer Free Writing Prospectus, or in any amendment thereof or supplement thereto, or in any “issuer information” (as defined in Rule 433 under the Securities Act) of the Company, which
“issuer information” is required to be, or is, filed with the Commission or otherwise contained in any Free Writing Prospectus, or any amendment or supplement thereto, or any omission or alleged omission to state therein, or in any
document incorporated by reference therein, 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; provided, however, that
(A) the Company shall not be liable under this Section 8.1(i) to the extent that a court of competent jurisdiction shall have determined by a final judgment (from which no further appeals are available) that such loss, claim, damage,
liability or expense resulted directly and solely from any such acts or failures to act, undertaken or omitted to be taken by the Investor or such person through its bad faith or willful misconduct, (B) the foregoing indemnity shall not apply
to any loss, claim, damage, liability or expense to the extent, but only to the extent, arising out of or based upon any untrue statement or alleged untrue statement or omission or alleged omission made in reliance upon and in conformity with
written information furnished to the Company by the Investor expressly for use in the Current Report or any Prospectus Supplement or Permitted Free Writing Prospectus, or any amendment thereof or supplement thereto, and (C) with respect to the
Prospectus, the foregoing indemnity shall not inure to the benefit of the Investor or any such person from whom the person asserting any loss, claim, damage, liability or expense purchased Common Stock, if copies of all Prospectus Supplements
required to be filed pursuant to Section 1.4 and 5.9, together with the Base Prospectus, were timely delivered or made available to the Investor pursuant hereto and a copy of the Base Prospectus, together with a Prospectus Supplement (as
applicable), was not sent or given by or on behalf of the Investor or any such person to such person, if required by law to have been delivered, at or prior to the written confirmation of the sale of the Common Stock to such person, and if delivery
of the Base Prospectus, together with a Prospectus Supplement (as applicable), would have cured the defect giving rise to such loss, claim, damage, liability or expense. 
 The Company shall reimburse the Investor and each such controlling person promptly upon demand (with accompanying presentation of documentary evidence) for all legal and other costs and expenses
reasonably incurred by the Investor or such indemnified persons in investigating, defending against, or preparing to defend against any such claim, action, suit or proceeding with respect to which it is entitled to indemnification. 
  

 34 

 (ii) Indemnification by the Investor. The Investor shall indemnify and hold
harmless the Company, each of its directors and officers, and each person, if any, who controls the Company within the meaning of Section 15 of the Securities Act or Section 20(a) of the Exchange Act from and against all losses, claims,
damages, liabilities and expenses (including reasonable costs of defense and investigation and all attorneys fees) to which the Company and each such other person may become subject, under the Securities Act or otherwise, insofar as such losses,
claims, damages, liabilities and expenses (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in the Current Report or any Prospectus Supplement or Permitted
Free Writing Prospectus, or in any amendment thereof or supplement thereto, or any omission or alleged omission to state therein 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, in each case, to the extent, but only to the extent, the untrue statement, alleged untrue statement, omission or alleged omission was made in reliance upon, and in conformity with, written information
furnished by the Investor to the Company expressly for inclusion in the Current Report or such Prospectus Supplement or Permitted Free Writing Prospectus, or any amendment thereof or supplement thereto. 
 The Investor shall reimburse the Company and each such director, officer or controlling person promptly upon demand for all legal and other
costs and expenses reasonably incurred by the Company or such indemnified persons in investigating, defending against, or preparing to defend against any such claim, action, suit or proceeding with respect to which it is entitled to indemnification.

 Section 8.2 Indemnification Procedures. Promptly after a person receives notice of a claim or the
commencement of an action for which the person intends to seek indemnification under Section 8.1, the person will notify the indemnifying party in writing of the claim or commencement of the action, suit or proceeding; provided,
however, that failure to notify the indemnifying party will not relieve the indemnifying party from liability under Section 8.1, except to the extent it has been materially prejudiced by the failure to give notice. The indemnifying party
will be entitled to participate in the defense of any claim, action, suit or proceeding as to which indemnification is being sought, and if the indemnifying party acknowledges in writing the obligation to indemnify the party against whom the claim
or action is brought, the indemnifying party may (but will not be required to) assume the defense against the claim, action, suit or proceeding with counsel satisfactory to it. After an indemnifying party notifies an indemnified party that the
indemnifying party wishes to assume the defense of a claim, action, suit or proceeding, the indemnifying party will not be liable for any legal or other expenses incurred by the indemnified party in connection with the defense against the claim,
action, suit or proceeding except that if, in the opinion of counsel to the indemnifying party, one or more of the indemnified parties should be separately represented in connection with a claim, action, suit or proceeding, the indemnifying party
will pay the reasonable fees and expenses of one separate counsel for the indemnified parties. Each indemnified party, as a condition to receiving indemnification as provided in Section 8.1, will cooperate in all reasonable respects with the
indemnifying party in the defense of any action or claim as

  

 35 

 
to which indemnification is sought. No indemnifying party will be liable for any settlement of any action effected without its prior written consent. Notwithstanding the foregoing sentence, if at
any time an indemnified party that is entitled to reimbursement pursuant to this Article VII shall have requested (by written notice provided in accordance with Section 9.4) an indemnifying party to reimburse the indemnified party for fees and
expenses of counsel, such indemnifying party agrees that it shall be liable for any settlement of the nature contemplated hereby effected without its written consent if (i) such settlement is entered into more than 45 days after receipt by such
indemnifying party of the aforesaid request, (ii) such indemnifying party shall have received written notice of the terms of such settlement at least 30 days prior to such settlement being entered into and (iii) such indemnifying party
shall not have reimbursed such indemnified party in accordance with such request prior to the date of such settlement. No indemnifying party will, without the prior written consent of the indemnified party, effect any settlement of a pending or
threatened action with respect to which an indemnified party is, or is informed that it may be, made a party and for which it would be entitled to indemnification, unless the settlement includes an unconditional release of the indemnified party from
all liability and claims which are the subject matter of the pending or threatened action. 
 If for any reason the
indemnification provided for in this Agreement is not available to, or is not sufficient to hold harmless, an indemnified party in respect of any loss or liability referred to in Section 8.1 as to which such indemnified party is entitled to
indemnification thereunder, each indemnifying party shall, in lieu of indemnifying the indemnified party, contribute to the amount paid or payable by the indemnified party as a result of such loss or liability, (i) in the proportion which is
appropriate to reflect the relative benefits received by the indemnifying party, on the one hand, and by the indemnified party, on the other hand, from the sale of Shares which is the subject of the claim, action, suit or proceeding which resulted
in the loss or liability or (ii) if the allocation provided by clause (i) is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above, but also the
relative fault of the indemnifying party, on the one hand, and the indemnified party, on the other hand, with respect to the statements or omissions which are the subject of the claim, action, suit or proceeding that resulted in the loss or
liability, as well as any other relevant equitable considerations. 
 The remedies provided for in Section 8.1 and this
Section 8.2 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any indemnified person at law or in equity. 
 ARTICLE IX 
 MISCELLANEOUS 
 Section 9.1 Fees and Expenses. 
 (i) Each party shall bear its own fees and expenses related to the transactions contemplated by this Agreement; provided, however, that the Company shall pay, on the Effective Date, by wire
transfer of immediately available funds to an account designated by the Investor’s counsel, promptly following the receipt of an invoice therefor, all reasonable attorneys’ fees and expenses (exclusive

  

 36 

 
of disbursements and out-of-pocket expenses) incurred by the Investor, up to $35,000, in connection with the preparation, negotiation, execution and delivery of this Agreement, legal due
diligence of the Company and review of the Registration Statement, the Base Prospectus, the Current Report, any Permitted Free Writing Prospectus and all other related transaction documentation. In addition, the Company shall pay, on the
30th day of the third month in each calendar quarter
during the Investment Period when no Shares have been purchased or sold because the Company did not deliver a Fixed Request Notice, promptly following the receipt of a reasonably detailed invoice therefor, all reasonable attorneys’ fees and
expenses, up to $5,000, representing the due diligence expenses incurred by the Investor during such calendar quarter. The Company shall pay all U.S. federal, state and local stamp and other similar transfer and other taxes and duties levied in
connection with issuance of the Shares pursuant hereto. 
 (ii) If the Company issues a Fixed Request Notice and fails to
deliver the Shares (which have been approved for listing or quotation on the Trading Market) to the Investor on the applicable Settlement Date and such failure continues for 10 Trading Days, the Company shall pay the Investor, in cash (or, at the
option of the Investor, in shares of Common Stock which have not been registered under the Securities Act valued at the applicable Discount Price of the Shares failed to be delivered; provided that the issuance thereof by the Company would
not violate the Securities Act or any applicable U.S. state securities laws), as liquidated damages for such failure and not as a penalty, an amount equal to 2.0% of the payment required to be paid by the Investor on such Settlement Date (i.e., the
sum of the Fixed Amount Requested and the Optional Amount Dollar Amount) for the initial 30 days following such Settlement Date until the Shares (which have been approved for listing or quotation on the Trading Market) have been delivered, and an
additional 2.0% for each additional 30-day period thereafter until the Shares (which have been approved for listing or quotation on the Trading Market) have been delivered, which amount shall be prorated for such periods less than 30 days (subject
in all cases to the Trading Market Limit). 
 Section 9.2 Specific Enforcement, Consent to Jurisdiction, Waiver of
Jury Trial. 
 (i) The Company and the Investor acknowledge and agree that irreparable damage would occur in the
event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that either party shall be entitled to an injunction or injunctions to prevent or cure
breaches of the provisions of this Agreement by the other party and to enforce specifically the terms and provisions hereof this being in addition to any other remedy to which either party may be entitled by law or equity. 
 (ii) Each of the Company and the Investor (a) hereby irrevocably submits to the jurisdiction of the United States District Court and
other courts of the United States sitting in the State of Delaware for the purposes of any suit, action or proceeding arising out of or relating to this Agreement, and (b) hereby waives, and agrees not to assert in any such suit, action or
proceeding, any claim that it is not personally subject to the jurisdiction of such court, that the suit, action or proceeding is brought in an inconvenient forum or that the venue of the suit, action or proceeding is improper. Each of the Company
and the Investor consents to process being

  

 37 

 
served in any such suit, action or proceeding by mailing a copy thereof 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 in this Section 9.2 shall affect or limit any right to serve process in any other manner permitted by law. 
 (iii) Each of the Company and the Investor hereby waives to the fullest extent permitted by applicable law, any right it may have to a trial
by jury in respect to any litigation directly or indirectly arising out of, under or in connection with this Agreement or the transactions contemplated hereby or disputes relating hereto. Each of the Company and the Investor (a) certifies that
no representative, agent or attorney of any other party has represented, expressly or otherwise, that such other party would not, in the event of litigation, seek to enforce the foregoing waiver and (b) acknowledges that it and the other
parties hereto have been induced to enter into this Agreement by, among other things, the mutual waivers and certifications in this Section 9.2. 
 Section 9.3 Entire Agreement; Amendment. This Agreement, together with the exhibits referred to herein and the Disclosure Schedule, represents the entire agreement of the parties with
respect to the subject matter hereof, and there are no promises, undertakings, representations or warranties by either party relative to subject matter hereof not expressly set forth herein. No provision of this Agreement may be amended other than
by a written instrument signed by both parties hereto. The Disclosure Schedule and all exhibits to this Agreement are hereby incorporated by reference in, and made a part of, this Agreement as if set forth in full herein. 
 Section 9.4 Notices. Any notice, demand, request, waiver or other communication required or permitted to be given
hereunder shall be in writing and shall be effective (a) upon hand delivery or facsimile (with facsimile machine confirmation of delivery received) at the address or number designated below (if delivered on a business day during normal business
hours where such notice is to be received), or the first business day following such delivery (if delivered other than on a business day during normal business hours where such notice is to be received) or (b) on the second business day
following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur. The address for such communications shall be: 
  

			
	If to the Company:	  	 Vical Incorporated
 10390
Pacific Center Court
 San Diego, California 92121-4340

		  	 Telephone Number: (858) 646-1100
 Fax: (858) 646-1150
 Attention: Chief Financial Officer

		
	With copies to:	  	 Cooley Godward Kronish LLP
 4401 Eastgate Mall
 San Diego, California

		  	 Telephone Number: (858) 550-6000
 Fax: (858) 550-6420
 Attention: Frederick T. Muto, Esq.

  

 38 

			
	If to the Investor:	  	 Azimuth Opportunity Ltd.
 c/o Folio Administrators Limited
 Folio House

		  	 P.O. Box 800
 Road Town,
Tortola VG1110
 British Virgin Islands

		  	 Telephone Number: (284) 494-7065 Ext. 250
 Fax: (284) 494-8356/7422
 Attention: Tamara Singh

		
	With copies to:	  	 Greenberg Traurig, LLP
 The
MetLife Building
 200 Park Avenue

		  	 New York, NY 10166
 Telephone Number: (212) 801-9200
 Fax: (212) 801-6400

		  	Attention: Anthony J. Marsico, Esq.

 Either party hereto may from time to time change its address for notices by giving at least 10 days
advance written notice of such changed address to the other party hereto. 
 Section 9.5 Waivers. No waiver
by either party of any default with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any other provisions, condition or requirement hereof nor shall any delay
or omission of any party to exercise any right hereunder in any manner impair the exercise of any such right accruing to it thereafter. No provision of this Agreement may be waived other than in a written instrument signed by the party against whom
enforcement of such waiver is sought. 
 Section 9.6 Headings. The article, section and subsection headings
in this Agreement are for convenience only and shall not constitute a part of this Agreement for any other purpose and shall not be deemed to limit or affect any of the provisions hereof. 
 Section 9.7 Successors and Assigns. The Investor may not assign this Agreement to any person without the prior consent of
the Company, in the Company’s sole discretion. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and assigns. The assignment by a party to this Agreement of any rights hereunder shall not affect
the obligations of such party under this Agreement. 
 Section 9.8 Governing Law. This Agreement shall be
governed by and construed in accordance with the internal procedural and substantive laws of the State of Delaware, without giving effect to the choice of law provisions of such state that would cause the application of the laws of any other
jurisdiction. 
  

 39 

 Section 9.9 Survival. The representations, warranties, covenants and
agreements of the Company and the Investor contained in this Agreement shall survive the execution and delivery hereof until the termination of this Agreement; provided, however, that the provisions of Article VII (Termination),
Article VIII (Indemnification), Section 9.1 (Fees and Expenses), Section 9.2 (Specific Enforcement, Consent to Jurisdiction, Waiver of Jury Trial), Section 9.4 (Notices), Section 9.8 (Governing Law), Section 9.9 (Survival),
Section 9.11 (Publicity) and Section 9.12 (Severability) shall remain in full force and effect notwithstanding such termination. 
 Section 9.10 Counterparts. This Agreement may be executed in counterparts, all of which taken together shall constitute one and the same original and binding instrument and shall become
effective when all counterparts have been signed by each party and delivered to the other parties hereto, it being understood that all parties hereto need not sign the same counterpart. In the event any signature is delivered by facsimile, digital
or electronic transmission, such transmission shall constitute delivery of the manually executed original and the party using such means of delivery shall thereafter cause four additional executed signature pages to be physically delivered to the
other parties within five days of the execution and delivery hereof. Failure to provide or delay in the delivery of such additional executed signature pages shall not adversely affect the efficacy of the original delivery. 
 Section 9.11 Publicity. On or after the Effective Date, the Company may issue a press release or otherwise make a public
statement or announcement with respect to this Agreement or the transactions contemplated hereby or the existence of this Agreement (including, without limitation, by filing a copy of this Agreement with the Commission); provided,
however, that prior to issuing any such press release, or making any such public statement or announcement, the Company shall consult with the Investor on the form and substance of such press release or other disclosure. 
 Section 9.12 Severability. The provisions of this Agreement are severable and, in the event that any court of competent
jurisdiction shall determine that any one or more of the provisions or part of the provisions contained in this Agreement shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision or part of a provision of this Agreement, and this Agreement shall be reformed and construed as if such invalid or illegal or unenforceable provision, or part of such provision, had never been
contained herein, so that such provisions would be valid, legal and enforceable to the maximum extent possible. 
 Section 9.13 Further Assurances. From and after the date of this Agreement, upon the request of the Investor or the Company, each of the Company and the Investor shall execute and deliver such instrument, documents and
other writings as may be reasonably necessary or desirable to confirm and carry out and to effectuate fully the intent and purposes of this Agreement. 
 [Signature Page Follows] 
  

 40 

 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed
by their respective authorized officer as of the date first above written. 
  

			
	VICAL INCORPORATED:
		
	By:	 	 /s/ Jill M. Broadfoot

	Name:	 	Jill M. Broadfoot
	Title:	 	Senior Vice President, Chief Financial Officer and Secretary
	
	AZIMUTH OPPORTUNITY LTD.:
		
	By:	 	 /s/ Peter Poole

	Name:	 	Peter Poole
	Title:	 	Director

  

 41 

 ANNEX A TO THE 
 COMMON STOCK PURCHASE AGREEMENT 
 DEFINITIONS 

 (a) “Acceptable Financing” shall have the meaning assigned to such term in Section 5.6(ii) hereof.

 (b) “Aggregate Limit” shall have the meaning assigned to such term in Section 1.1 hereof. 

(c) “Base Prospectus” shall mean the Company’s prospectus, dated January 8, 2010, a preliminary form of which
is included in the Registration Statement, including the documents incorporated by reference therein. 
 (d) “Below
Market Offering” shall have the meaning assigned to such term in Section 5.6(ii) hereof. 
 (e)
“Broker-Dealer” shall have the meaning assigned to such term in Section 5.13 hereof. 
 (f)
“Bylaws” shall have the meaning assigned to such term in Section 4.3 hereof. 
 (g)
“Charter” shall have the meaning assigned to such term in Section 4.3 hereof. 
 (h)
“Code” shall mean the Internal Revenue Code of 1986, as amended. 
 (i) “Commission” shall
mean the Securities and Exchange Commission or any successor entity. 
 (j) “Commission Documents” shall mean
(1) all reports, schedules, registrations, forms, statements, information and other documents filed by the Company with the Commission pursuant to the reporting requirements of the Exchange Act, including all material filed pursuant to
Section 13(a) or 15(d) of the Exchange Act, which have been filed by the Company since December 31, 2008 and which hereafter shall be filed by the Company during the Investment Period, including, without limitation, the Current Report and
the Form 10-K filed by the Company for its fiscal year ended December 31, 2008 (the “2008 Form 10-K”), (2) the Registration Statement, as the same may be amended from time to time, the Prospectus and each Prospectus
Supplement, and each Permitted Free Writing Prospectus and (3) all information contained in such filings and all documents and disclosures that have been and heretofore shall be incorporated by reference therein. 
 (k) “Common Stock” shall have the meaning assigned to such term in the Recitals. 
 (l) “Current Market Price” means, with respect to any particular measurement date, the closing price of a share of Common
Stock as reported on the Trading Market for the Trading Day immediately preceding such measurement date. 

 (m) “Current Report” shall have the meaning assigned to such term in
Section 1.4 hereof. 
 (n) “Discount Price” shall have the meaning assigned to such term in
Section 2.2 hereof. 
 (o) “EDGAR” shall have the meaning assigned to such term in Section 4.3
hereof. 
 (p) “Effective Date” shall mean the date of this Agreement. 
 (q) “Environmental Laws” shall have the meaning assigned to such term in Section 4.15 hereof. 
 (r) “ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended. 
 (s) “Event Period” shall have the meaning assigned to such term in Section 7.2 hereof. 
 (t) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended, and the rules and regulations of the
Commission thereunder. 
 (u) “FDA” shall have the meaning assigned to such term in Section 4.14(a)
hereof. 
 (v) “FINRA” shall have the meaning assigned to such term in Section 4.18 hereof. 
 (w) “Fixed Amount Requested” shall mean the amount of a Fixed Request requested by the Company in a Fixed Request Notice
delivered pursuant to Section 2.1 hereof. 
 (x) “Fixed Request” means the transactions contemplated under
Sections 2.1 through 2.8 of this Agreement. 
 (y) “Fixed Request Amount” means the actual amount of proceeds
received by the Company pursuant to a Fixed Request under this Agreement. 
 (z) “Fixed Request Exercise Date”
shall have the meaning assigned to such term in Section 2.2 hereof. 
 (aa) “Fixed Request Notice” shall
have the meaning assigned to such term in Section 2.1 hereof. 
 (bb) “Free Writing Prospectus” shall mean
a “free writing prospectus” as defined in Rule 405 promulgated under the Securities Act. 
 (cc)
“GAAP” shall mean generally accepted accounting principles in the United States of America as applied by the Company. 
 (dd) “Governmental Licenses” shall have the meaning assigned to such term in Section 4.14(a) hereof. 

 (ee) “Indebtedness” shall have the meaning assigned to such term in
Section 4.9 hereof. 
 (ff) “Integration Notice” shall have the meaning assigned to such term in
Section 5.6(ii) hereof. 
 (gg) “Intellectual Property” shall have the meaning assigned to such term in
Section 4.14(b) hereof. 
 (hh) “Investment Period” shall have the meaning assigned to such term in
Section 7.1 hereof. 
 (ii) “Issuer Free Writing Prospectus” shall mean an “issuer free writing
prospectus” as defined in Rule 433 promulgated under the Securities Act. 
 (jj) “Market Capitalization”
shall be calculated on the Trading Day preceding the applicable Pricing Period and shall be the product of (x) the number of shares of Common Stock outstanding and (y) the closing bid price of the Common Stock, both as determined by
Bloomberg Financial LP using the DES and HP functions. 
 (kk) “Material Adverse Effect” shall mean any
condition, occurrence, state of facts or event having, or insofar as reasonably can be foreseen would likely have, any effect on the business, operations, properties or condition (financial or otherwise) of the Company that is material and adverse
to the Company and its Subsidiaries, taken as a whole, and/or any condition, occurrence, state of facts or event that would prohibit or otherwise materially interfere with or delay the ability of the Company to perform any of its obligations under
this Agreement; provided, however, that none of the following, individually or in the aggregate, shall be taken into account in determining whether a Material Adverse Effect has occurred or insofar as reasonably can be foreseen would
likely occur: (i) changes in conditions in the U.S. or global capital, credit or financial markets generally, including changes in the availability of capital or currency exchange rates, provided such changes shall not have affected the Company
in a materially disproportionate manner as compared to other similarly situated companies; (ii) changes generally affecting the biotechnology or pharmaceutical industries, provided such changes shall not have affected the Company in a
materially disproportionate manner as compared to other similarly situated companies; and (iii) any effect of the announcement of this Agreement or the consummation of the transactions contemplated by this Agreement on the Company’s
relationships, contractual or otherwise, with customers, suppliers, vendors, bank lenders, strategic venture partners, collaborators, licensees or employees. 
 (ll) “Material Agreements” shall have the meaning assigned to such term in Section 4.16 hereof. 
 (mm) “Material Change in Ownership” shall mean the occurrence of any one or more of the following: (i) the acquisition by any person, including any syndicate or group deemed to be a
“person” under Section 13(d)(3) of the Exchange Act, of beneficial ownership, directly or indirectly, through a purchase, merger or other acquisition transaction or series of transactions, of shares of capital stock or other
securities of the Company entitling such person to exercise, upon an event of default or default or otherwise, 50% or more of the total voting power of all series and classes of capital stock and other securities of the Company entitled to vote

 
generally in the election of directors, other than any such acquisition by the Company, any Subsidiary of the Company or any employee benefit plan of the Company; (ii) any consolidation or
merger of the Company with or into any other person, any merger of another person into the Company, or any conveyance, transfer, sale, lease or other disposition of all or substantially all of the properties and assets of the Company to another
person, other than (a) any such transaction (x) that does not result in any reclassification, conversion, exchange or cancellation of outstanding shares of capital stock of the Company and (y) pursuant to which holders of capital
stock of the Company immediately prior to such transaction have the entitlement to exercise, directly or indirectly, 50% or more of the total voting power of all shares of capital stock of the Company entitled to vote generally in the election of
directors of the continuing or surviving person immediately after such transaction or (b) any merger which is effected solely to change the jurisdiction of incorporation of the Company and results in a reclassification, conversion or exchange
of outstanding shares of Common Stock solely into shares of common stock of the surviving entity; (iii) during any consecutive two-year period, individuals who at the beginning of that two-year period constituted the Board of Directors
(together with any new directors whose election to the Board of Directors, or whose nomination for election by the stockholders of the Company, was approved by a vote of a majority of the directors then still in office who were either directors at
the beginning of such period or whose elections or nominations for election were previously so approved) cease for any reason to constitute a majority of the Board of Directors then in office; or (iv) the Company is liquidated or dissolved or a
resolution is passed by the Company’s stockholders approving a plan of liquidation or dissolution of the Company. Beneficial ownership shall be determined in accordance with Rule 13d-3 promulgated by the SEC under the Exchange Act. The term
“person” shall include any syndicate or group which would be deemed to be a “person” under Section 13(d)(3) of the Exchange Act. 
 (nn) “Multiplier” shall have the meaning assigned to such term in Section 2.3 hereof. 
 (oo) “NASDAQ” means the NASDAQ Global Market or any successor thereto. 
 (pp) “Optional Amount” means the transactions contemplated under Sections 2.9 through 2.11 of this Agreement. 
 (qq) “Optional Amount Dollar Amount” shall mean the actual amount of proceeds received by the Company pursuant to the exercise of an Optional Amount under this Agreement. 
 (rr) “Optional Amount Notice” shall mean a notice sent to the Company with regard to the Investor’s election to
exercise all or any portion of an Optional Amount, as provided in Section 2.11 hereof and substantially in the form attached hereto as Exhibit B. 
 (ss) “Optional Amount Threshold Price” shall have the meaning assigned to such term in Section 2.1 hereof. 
 (tt) “Other Financing” shall have the meaning assigned to such term in Section 5.6(ii) hereof. 
 (uu) “Other Financing Notice” shall have the meaning assigned to such term in Section 5.6(ii) hereof. 

 (vv) “Permitted Free Writing Prospectus” shall have the meaning assigned to
such term in Section 5.8(ii) hereof. 
 (ww) “Plan” shall have the meaning assigned to such term in
Section 4.22 hereof. 
 (xx) “Pricing Period” shall mean a period of 10 consecutive Trading Days
commencing on the Pricing Period start date set forth in the Fixed Request Notice, or such other period mutually agreed upon by the Investor and the Company. 
 (yy) “Prospectus” shall mean the Base Prospectus, together with any final prospectus filed with the Commission pursuant to Rule 424(b), as supplemented by any Prospectus Supplement,
including the documents incorporated by reference therein. 
 (zz) “Prospectus Supplement” shall mean any
prospectus supplement to the Base Prospectus filed with the Commission pursuant to Rule 424(b) under the Securities Act, including the documents incorporated by reference therein. 
 (aaa) “Reduction Notice” shall have the meaning assigned to such term in Section 2.8 hereof. 
 (bbb) “Registration Statement” shall mean the registration statement on Form S-3, Commission File Number 333-159103, filed
by the Company with the Commission under the Securities Act for the registration of the Shares, as such Registration Statement may be amended and supplemented from time to time (including pursuant to Rule 462(b) under the Securities Act), including
all documents filed as part thereof or incorporated by reference therein, and including all information deemed to be a part thereof at the time of effectiveness pursuant to Rule 430A or Rule 430B under the Securities Act. 
 (ccc) “Restricted Period” shall have the meaning assigned to such term in Section 5.10 hereof. 
 (ddd) “Securities Act” shall mean the Securities Act of 1933, as amended, and the rules and regulations of the Commission
thereunder. 
 (eee) “Settlement Date” shall have the meaning assigned to such term in Section 2.7 hereof.

 (fff) “Shares” shall mean shares of Common Stock issuable to the Investor upon exercise of a Fixed Request
and shares of Common Stock issuable to the Investor upon exercise of an Optional Amount. 
 (ggg) “Significant
Subsidiary” means any Subsidiary of the Company that would constitute a Significant Subsidiary of the Company within the meaning of Rule 1-02 of Regulation S-X of the Commission. 
 (hhh) “SOXA” shall have the meaning assigned to such term in Section 4.6(c) hereof. 

 (iii) “Subsidiary” shall mean any corporation or other entity of which at
least a majority of the securities or other ownership interest having ordinary voting power (absolutely or contingently) for the election of directors or other persons performing similar functions are at the time owned directly or indirectly by the
Company and/or any of its other Subsidiaries. 
 (jjj) “Threshold Price” is the lowest price (except to the
extent otherwise provided in Section 2.6) at which the Company may sell Shares during the applicable Pricing Period as set forth in a Fixed Request Notice (not taking into account the applicable percentage discount during such Pricing Period
determined in accordance with Section 2.2); provided, however, that at no time shall the Threshold Price be lower than $1.50 per share unless the Company and the Investor mutually shall agree. 
 (kkk) “Total Commitment” shall have the meaning assigned to such term in Section 1.1 hereof. 
 (lll) “Trading Day” shall mean a full trading day (beginning at 9:30 a.m., New York City time, and ending at 4:00 p.m., New
York City time) on the NASDAQ. 
 (mmm) “Trading Market” means the following markets or exchanges on which the
Common Stock is listed or quoted for trading on the date in question: the NYSE AMEX, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market or the New York Stock Exchange (or any successors to any of the foregoing),
whichever is at the time the principal trading exchange or market for the Common Stock. 
 (nnn) “Trading Market
Limit” means 10,763,629 shares of duly authorized, validly issued, fully paid and non-assessable shares of Common Stock (as adjusted for any stock splits, stock combinations, stock dividends, recapitalizations and other similar transactions
that occur on or after the date of this Agreement); provided, however, that the Trading Market Limit shall not exceed under any circumstances that number of shares of Common Stock that the Company may issue pursuant to this Agreement
and the transactions contemplated hereby without (a) breaching the Company’s obligations under the rules and regulations of the Trading Market or (b) obtaining stockholder approval under the applicable rules and regulations of the
Trading Market. 
 (ooo) “VWAP” shall mean the daily volume weighted average price (based on a Trading Day from
9:30 a.m. to 4:00 p.m. (New York time)) of the Company on the NASDAQ as reported by Bloomberg Financial L.P. using the AQR function. 
 (ppp) “Warrant Value” shall mean the fair value of all warrants, options and other similar rights issued to a third party in connection with an Other Financing, determined by using a standard Black-Scholes option-pricing
model using an expected volatility percentage as shall be mutually agreed by the Investor and the Company. In the case of a dispute relating to such expected volatility assumption, the Investor shall obtain applicable volatility data from three
investment banking firms of nationally recognized reputation, and the parties hereto shall use the average thereof for purposes of determining the expected volatility percentage in connection with the Black-Scholes calculation referred to in the
immediately preceding sentence. 

 EXHIBIT A TO THE 
 COMMON STOCK PURCHASE AGREEMENT 
 FORM OF FIXED
REQUEST NOTICE 
 Reference is made to the Common Stock Purchase Agreement dated as of January 8, 2010, (the
“Purchase Agreement”) between Vical Incorporated, a corporation organized and existing under the laws of the State of Delaware (the “Company”), and Azimuth Opportunity Ltd., an international business company
incorporated under the laws of the British Virgin Islands. Capitalized terms used and not otherwise defined herein shall have the meanings given such terms in the Purchase Agreement. 
 In accordance with and pursuant to Section 2.1 of the Purchase Agreement, the Company hereby issues this Fixed Request Notice to
exercise a Fixed Request for the Fixed Amount Requested indicated below. 
  

							
	Fixed Amount Requested:	  		  	  

			
	Optional Amount Dollar Amount:	  		  	  

			
	Pricing Period start date:	  		  	  

			
	Pricing Period end date:	  		  	  

			
	Settlement Date:	  		  	  

			
	Fixed Request Threshold Price:	  		  	  

			
	Optional Amount Threshold Price:	  		  	  

			
	Dollar Amount of Common Stock Currently Unissued under the Registration Statement;	  		  	  

			
	Dollar Amount of Common Stock Currently Available under the Aggregate Limit:	  		  	  

				
	Dated:                     	  		  	By:	  	  

		  		  	Name	  	
		  		  	Title:	  	
			
		  		  	Address:
		  		  	Facsimile No.

  

			
	AGREED AND ACCEPTED
		
	By:	 	  

	Name	 	
	Title:	 	

 EXHIBIT B TO THE 
 COMMON STOCK PURCHASE AGREEMENT 
 FORM OF OPTIONAL
AMOUNT NOTICE 
 To:
                     
 Fax#:
                 
 Reference is made to
the Common Stock Purchase Agreement dated as of January 8, 2010 (the “Purchase Agreement”) between Vical Incorporated, a corporation organized and existing under the laws of the State of Delaware (the
“Company”), and Azimuth Opportunity Ltd., an international business company incorporated under the laws of the British Virgin Islands (the “Investor”). Capitalized terms used and not otherwise defined herein shall
have the meanings given such terms in the Purchase Agreement. 
 In accordance with and pursuant to Section 2.1 of the
Purchase Agreement, the Investor hereby issues this Optional Amount Notice to exercise an Optional Amount for the Optional Amount Dollar Amount indicated below. 
  

									
	Optional Amount Dollar Amount Exercised	  		  	  

			
	Number of Shares to be purchased	  		  	  

			
	VWAP on the date hereof:	  		  	  

			
	Discount Price:	  		  	  

			
	Settlement Date:	  		  	  

			
	Threshold Price:	  		  	  

				
	Dated:                     	  		  	By:	  	  

		  		  	 Name
 Title:

	  	
			
		  		  	 Address:
 Facsimile No.

 EXHIBIT C TO THE 
 COMMON STOCK PURCHASE AGREEMENT 
 CERTIFICATE OF THE
COMPANY 
 CLOSING CERTIFICATE 
              200   
 The undersigned, the [            ] of Vical Incorporated, a corporation organized and existing under the laws of the State of Delaware
(the “Company”), delivers this certificate in connection with the Common Stock Purchase Agreement, dated as of January 8, 2010 (the “Agreement”), by and between the Company and Azimuth Opportunity Ltd., an
international business company incorporated under the laws of the British Virgin Islands (the “Investor”), and hereby certifies on the date hereof that (capitalized terms used herein without definition have the meanings assigned to
them in the Agreement): 
 1. Attached hereto as Exhibit A is a true, complete and correct copy of the Certificate of
Incorporation of the Company as filed with the Secretary of State of the State of Delaware. The Certificate of Incorporation of the Company has not been further amended or restated, and no document with respect to any amendment to the Certificate of
Incorporation of the Company has been filed in the office of the Secretary of State of the State of Delaware since the date shown on the face of the state certification relating to the Company’s Certificate of Incorporation, which is in full
force and effect on the date hereof, and no action has been taken by the Company in contemplation of any such amendment or the dissolution, merger or consolidation of the Company. 
 2. Attached hereto as Exhibit B is a true and complete copy of the Bylaws of the Company, as amended and restated through, and as in
full force and effect on, the date hereof, and no proposal for any amendment, repeal or other modification to the Bylaws of the Company has been taken or is currently pending before the Board of Directors or stockholders of the Company. 

3. The Board of Directors of the Company has approved the transactions contemplated by the Agreement; said approval has not been amended,
rescinded or modified and remains in full force and effect as of the date hereof. 
 4. Each person who, as an officer of the
Company, or as attorney-in-fact of an officer of the Company, signed (i) the Agreement and (ii) any other document delivered prior hereto or on the date hereof in connection with the transactions contemplated by the Agreement, was duly
elected, qualified and acting as such officer or duly appointed and acting as such attorney-in-fact, and the signature of each such person appearing on any such document is his genuine signature. 
 IN WITNESS WHEREOF, I have signed my name as of the date first above written. 
  

	
	  

	 By:

	 Title:

 EXHIBIT D TO THE 
 COMMON STOCK PURCHASE AGREEMENT 
 COMPLIANCE
CERTIFICATE 
 In connection with the issuance of shares of common stock of Vical Incorporated, a corporation organized and
existing under the laws of the State of Delaware (the “Company”), pursuant to the Fixed Request Notice, dated
[                    ], delivered by the Company to Azimuth Opportunity Ltd. (the “Investor”) pursuant to Article II of the
Common Stock Purchase Agreement, dated January 8, 2010, by and between the Company and the Investor (the “Agreement”), the undersigned hereby certifies as follows: 
 1. The undersigned is the duly elected [            ] of the Company.

 2. Except as set forth in the attached Disclosure Schedule, the representations and warranties of the Company set forth in
Article IV of the Agreement (i) that are not qualified by “materiality” or “Material Adverse Effect” are true and correct in all material respects as of [insert Fixed Request Exercise Date] and as of the date hereof with the
same force and effect as if made on such dates, except to the extent such representations and warranties are as of another date, in which case, such representations and warranties are true and correct in all material respects as of such other date
and (ii) that are qualified by “materiality” or “Material Adverse Effect” are true and correct as of [insert Fixed Request Exercise Date] and as of the date hereof with the same force and effect as if made on such dates,
except to the extent such representations and warranties are as of another date, in which case, such representations and warranties are true and correct as of such other date. 
 3. The Company has performed, satisfied and complied in all material respects with all covenants, agreements and conditions required by the
Agreement to be performed, satisfied or complied with by the Company at or prior to [insert Fixed Request Exercise Date] and the date hereof. 
 Capitalized terms used but not otherwise defined herein shall have the meanings assigned to them in the Agreement. 
 The undersigned has executed this Certificate this [    ] day of [        ], 200[  ]. 
  

			
	 By:
	 	  

	 Name:
	 	  

	 Title:
	 	  

 DISCLOSURE SCHEDULE 
 RELATING TO THE COMMON STOCK 
 PURCHASE AGREEMENT,
DATED AS OF JANUARY 8, 2010 
 BETWEEN VICAL INCORPORATED AND AZIMUTH OPPORTUNITY LTD. 
 This disclosure schedule is made and given pursuant to Article IV of the Common Stock Purchase Agreement, dated as of January 8, 2010
(the “Agreement”), by and between Vical Incorporated, a Delaware corporation (the “Company”), and Azimuth Opportunity Ltd., an international business company incorporated under the laws of the British Virgin
Islands. Unless the context otherwise requires, all capitalized terms are used herein as defined in the Agreement. The numbers below correspond to the section numbers of representations and warranties in the Agreement most directly modified by the
below exceptions.

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