Document:

VACCINOGEN, INC.

 

AMENDMENT NO. 3 TO

NOTE AND WARRANT PURCHASE AGREEMENT

 

THIS AMENDMENT NO. 3 TO NOTE AND WARRANT
PURCHASE AGREEMENT is dated as of the ___ day of April, 2013, by and between Vaccinogen, Inc., a Maryland corporation (the
“Company”), and The Abell Foundation, Inc., a Maryland corporation (the “Purchaser”).

 

RECITALS

 

Reference is made to that certain Note and
Warrant Purchase Agreement dated October 26, 2011, by and between the Company and the Purchaser, as amended by that certain Amendment
No. 1 to Note and Warrant Purchase Agreement dated February 16, 2012, by and between the Company and the Purchaser and as further
amended by that certain Amendment No. 2 to Note and Warrant Purchase Agreement dated January 16, 2013, by and between the Company
and the Purchaser (the “Second Amendment,” and such Note and Warrant Purchase Agreement, as amended by
the Second Amendment, the “Existing Agreement,” and the Existing Agreement, as amended by this Amendment
No. 3, the “Agreement”), pursuant to which the Purchaser agreed to purchase from the Company a promissory
note (the “Existing Note”) in the maximum principal amount of One Million Eight Hundred Thousand Dollars
($1,800,000.00) and to purchase the “Warrant” as therein defined (the “Existing Warrant”).
In order to amend the Existing Agreement, inter alia, to extend the maturity of the Existing Note, and to modify the terms
of the Existing Warrant as hereinafter provided, the parties hereto have entered into this Amendment No. 3.

 

NOW, THEREFORE, in consideration of
the premises and the mutual covenants set forth herein, and such other consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:

 

1.          All
capitalized terms not otherwise defined herein which are defined in the Agreement shall have the same meanings assigned to them
in the Agreement.

 

2.          All
references to (a) “this Agreement” in the Agreement shall mean the Existing Agreement as amended by this Amendment
No. 3, (b) the “Note” in the Agreement and in the other Transaction Documents shall mean a promissory note in substantially
the form attached hereto as Exhibit A (the “Replacement Note”), which Exhibit shall replace in
its entirety Exhibit A to the Agreement, and (c) the “Warrant” in the Agreement shall mean a warrant to purchase
capital stock of the Company in substantially the form attached hereto as Exhibit B, which Exhibit shall replace in its
entirety Exhibit B to the Agreement.

 

    	 

    	 

    

 

3.         Section
1.2 of the Agreement is hereby amended to read in its entirety as follows:

 

1.2           Sale.
Subject to the terms and conditions hereof, the Purchaser agrees to purchase from the Company, and the Company agrees to sell and
issue to the Purchaser, (i) the Note, and (ii) a warrant which evidences the right of the Purchaser to purchase up to that number
of shares of Common Stock of the Company equal to (x) $1,100,000, divided by (y) eighty-five percent (85%) of the lowest purchase
price per share (after taking into account all discounts and other reductions in the purchase price offered to any purchaser) of
the Common Stock sold in the Company’s Venture Capital Financing (as defined below). “Venture Capital Financing”
shall mean the first transaction or series of transactions to occur after October 26, 2011 involving the issuance or sale of additional
shares of capital stock, or securities directly or indirectly convertible or exchangeable for capital stock, of the Company that
would result in at least $35,000,000 in aggregate gross proceeds to the Company, including by way of the conversion of any outstanding
debt.

 

4.         Section
5.10 of the Agreement is hereby amended to read in its entirety as follows:

 

5.10         Company’s
Venture Capital Financing. The Company agrees to (a) provide the Purchaser (i) on or before the fifteenth (15th)
day of each month, commencing April 15, 2013, with a report in form and detail acceptable to the Purchaser, describing the activities
of the Company during the immediately preceding month in connection with the
issuance or sale of additional shares of capital stock, or securities directly or indirectly convertible or exchangeable for capital
stock, of the Company, and (ii) with reasonable prior notice of the potential closing of the final transaction representing
the Company’s Venture Capital Financing, and (b) to issue the Warrant to the Purchaser at the closing of the final transaction
representing the Company’s Venture Capital Financing. 

 

5.         To
induce the Purchaser to enter into this Amendment No. 3, the Company hereby:

 

(a)        represents
and warrants to the Purchaser that (i) the representations and warranties of the Company set forth in Section 3 of the Agreement,
and the representations and warranties of the Company set forth in each of the other Transaction Documents, are true and correct
in all material respects with the same effect as if made on the date hereof (except
that (x) such materiality qualifier shall not be applicable to any representation or warranty that already are qualified or modified
by materiality in the text thereof, and (y) any representation and warranty stated to relate solely to an earlier date shall be
true and correct as of such earlier date), it being understood that all references to “this Agreement” and the “Transaction
Documents” in Section 3 of the Agreement shall include (without limitation) this Amendment No. 3 and the Warrant, respectively,
and (ii) after giving effect to the terms of this Amendment No. 3, the Company is in compliance with all the terms and conditions
of the Agreement and the other Transaction Documents, and no Default or Event of Default has occurred and is continuing; and 

 

    	- 2 -

    	 

    

 

(b)        releases
and forever discharges the Purchaser and the officers, employees and trustees thereof, of and from all manner of actions, causes
and causes of action, suits, debts, sums of money, account reckonings, bonds, bills, specialties, coverages, judgments, executions,
claims, and demands whatsoever, at law or in equity, and particularly, without limiting the generality of the foregoing, all claims
relating to the transactions which are the subject of the Transaction Documents, which the Company and its successors and assigns
ever had, now has, or may have in the future, for, upon or by reason of any matter, cause, or thing, whatsoever occurring prior
to the date hereof and/or arising from facts of which the Company was aware, or reasonably should have been aware, as of the date
hereof. Without limitation of the foregoing, the Company waives any and all defenses, offsets, and counterclaims to the Purchaser’s
enforcement of the Transaction Documents or any action by the Purchaser to foreclose any security interest.

 

6.         This
Amendment No. 3 shall become effective on the date upon which the following shall all have occurred:

 

(a)         the
Purchaser shall have received each of the following, in form and substance satisfactory to the Purchaser:

 

(i)          a
copy of this Amendment No. 3, duly executed and delivered by the Company;

 

(ii)         the
Replacement Note, duly executed and delivered by the Company;

 

(iii)        intellectual
property security agreements covering all intellectual property of the Company, each duly executed and delivered by the Company;
and

 

(iv)        certificate(s)
of the Secretary of the Company (A) to the effect that resolutions in form and content satisfactory to the Purchaser authorizing
the prior transactions between the Company and the Purchaser in connection with the Second Amendment and those transactions contemplated
hereby have been duly adopted and remain in full force and effect, and (B) certifying the incumbency and signatures of the officers
of the Company who executed the Second Amendment and who are authorized to execute this Amendment, the Replacement Note and the
Warrant; and

 

(b)         the
Purchaser shall have executed and delivered to the Company this Amendment No. 3.

 

    	- 3 -

    	 

    

 

7.          The
Company and the Purchaser intend that neither this Amendment No. 3, nor the execution and delivery of this Amendment No. 3, the
Replacement Note or any other document executed and delivered pursuant to or in connection with this Amendment No. 3, shall constitute
or be construed to operate as a novation of the Agreement, the Existing Note, any of the indebtedness of the Company pursuant to
the Existing Note, or any lien or security interest heretofore created pursuant to any of the Transaction Documents. The Company
and the Purchaser intend that by the execution and delivery of this Amendment No. 3 and the Replacement Note certain of the terms
of the note and warrant purchases by the Purchaser shall be modified, restated and replaced in their entireties, but the indebtedness
evidenced by the Existing Note and such liens and security interests heretofore created shall not be extinguished or satisfied.
Without limitation of the foregoing, the Company specifically acknowledges and agrees that (a) the “Note” as defined
in the Security Agreement dated as of October 26, 2011, by and between the Company and the Purchaser (the “Security
Agreement”) means the Replacement Note, (b) the “Obligations” as defined in the Security Agreement (the
“Obligations”) include all indebtedness and liabilities of the Company under the Agreement, under the
Replacement Note and under the other Transaction Documents, (c) the “Collateral” as defined in the Security Agreement
(the “Collateral”) secures, without limitation, the payment and performance all of the Obligations, (d)
the Obligations represent debt issued in connection with an investment in the Company, (e) the Collateral includes the “Collateral”
(the “Organon Collateral”) as defined in that certain New Security Agreement (the “Organon
Security Agreement”) made as of October 31, 2007 by and between (i) Intracell Holdings Corporation (predecessor to
the Company) and (ii) Organon BioSciences International B.V. and Organon Teknika Corporation (collectively, “Organon”);
provided that the inclusion of such “Collateral” as defined in the Organon Security Agreement is included specifically
subject to any liens or rights arising from the terms of the Organon Security Agreement, and (f) to the Company’s knowledge
there are no liens or security interests in the Collateral except for the security interest of the Purchaser therein and except
for the security interest granted to Organon in the Organon Collateral pursuant to the Organon Security Agreement.

 

8.          The
Company agrees to pay all out-of-pocket expenses incurred by the Purchaser in connection with the preparation, negotiation, execution
and delivery of this Amendment No. 3, the Replacement Note and all other documents executed or to be executed in connection herewith,
including, without limitation, the expenses and reasonable fees of its counsel in an amount not to exceed $5,000.

 

9.          The
Purchaser shall be permitted to set-off all amounts owed by it to the Company under the Investment Agreement against all amounts
owed to it by the Company with respect to the Note.

 

10.         Except
as amended hereby, the Agreement shall remain unchanged, and the Agreement, as so amended, shall continue in full force and effect
in accordance with its terms. The breach by the Company of any representation, warranty, covenant or agreement contained in this
Amendment No. 3 shall represent an Event of Default.

 

    	- 4 -

    	 

    

 

11.         This
Amendment No. 3 may be executed in any number of counterparts and by the different parties hereto on separate counterparts, each
of which, when so executed and delivered, shall be an original, but all such counterparts shall together constitute one and the
same instrument.

 

12.         The
Recitals hereto and all of the terms of the Agreement are hereby incorporated into and made a part hereof as though fully set forth
herein.

 

13.         This
Amendment No. 3 shall be governed by and construed under the laws of the State of Maryland, without regard to the conflicts of
laws provisions of the State of Maryland or any other state. Any suit, action or proceeding instituted by either party hereto with
respect to any of the obligations of other party hereto may be brought in any State or federal court located in the State of Maryland
(in addition to such other courts in which jurisdiction and venue may be appropriate), and each party consents to the in personam
jurisdiction of such courts.

 

[SIGNATURES CONTAINED ON THE FOLLOWING PAGE]

 

    	- 5 -

    	 

    

 

IN WITNESS WHEREOF, the parties have
caused this Amendment No. 3 to Note and Warrant Purchase Agreement to be duly executed under seal by their duly authorized
respective officers as of the day and year first above written.

 

	ATTEST/WITNESS:	 	VACCINOGEN, INC.
	 	 	 	 	 
	 	 	By:	/s/ Michael G.
    Hanna, Jr.	  (SEAL)
	 	 	 	Michael G. Hanna, Jr., Ph.D.
	 	 	 	Chairman and Chief Executive Officer
	 	 	 	 	 
	 	 	By:	/s/ Andrew L.
    Tussing	  (SEAL)
	 	 	 	Andrew L. Tussing
	 	 	 	President and Chief Operating Officer
	 	 	 	 	 
	 	 	THE ABELL FOUNDATION, INC.
	 	 	 	 	 
	 	 	By:	/s/ Robert C. Embry,
    Jr.	  (SEAL)
	 	 	 	Robert C. Embry, Jr.
	 	 	 	President

 

    	- 6 -February 14, 2013

 

Andrew L. Tussing

President & COO

Vaccinogen, Inc.

5300 Westview Drive, Suite 406

Frederick, MD 21703

 

Dear Andrew:

 

In response to our
recent discussions, we are pleased to propose a binding Agreement (“Agreement”) between First Liberties Financial,
a New York corporation together with its subsidiaries, successors and assigns, hereby referred to as FLF, a broker-dealer
registered with the SEC and member of FINRA, with principal offices at 369 Lexington Avenue, Suite 311, New York, NY 10017 and
Vaccinogen, Inc., a company with executive offices located at 5300 Westview Drive, Suite 406, Frederick, MD 21703 (together
with its affiliates, parent companies, subsidiaries, successors and assigns, hereby referred to as the “Company”),
collectively known as Parties, as follows:

 

1.          Services
to be Rendered. During the Term, the Company hereby retains FLF to provide corporate financial advisory services and to serve
as its advisor and placement agent for a best-efforts private placement (the “Placement”) of the Company’s equity
or debt securities in an amount expected to provide maximum gross proceeds of Forty Two Million U.S. dollars ($42,000,000). The
structure and terms of the Placement will be mutually agreed upon by (FLF and the Company.
FLF agrees that it will use its best efforts to find purchasers of the Shares or debt securities (the “Investors”),
and any such Investors shall qualify themselves as “accredited investors” as defined in Rule 501(a) under the Securities
Act of 1933 (the “Act”), but FLF disclaims any agreement,
expressed or implied, in this Agreement or otherwise, that it will be successful in placing the Shares or arranging Debt. FLF
shall identify prospective sources of capital to Company and advise Company of such prospect(s) in writing. Company shall,
after review and discussion, advise FLF in
writing to approach directly or arrange introductions to selected prospects. Such prospects shall then become identified as the
FLF’s List of Introduced Persons.
Shares may be purchased in the Placement by an affiliate of FLF and/or directly by or via an affiliate
of one or more of FLF’s principals, provided that such entity qualifies as an “accredited investor” as of the
date of such purchase. It is understood that the decision by FLF to act as Placement Agent will depend on satisfactory results
of FLF’s due diligence investigation and the final approval by FLF’s internal investment banking commitment committee.
Notwithstanding anything in this Agreement to the contrary, the Company shall have the sole and absolute discretion to accept
or not accept, in whole or in part, the terms of any subscription for
Shares.

 

    	 

    	 

    

 

FLF – Vaccinogen, Inc.. Engagement Letter

February 5, 2013

Page 2 of 7

CONFIDENTIAL

  

2.          Information.
In connection with FLF’s engagement, the Company will
furnish, or cause to be furnished, to FLF all data, material and other information requested by FLF for the purposes of
performing the services contemplated hereunder, subject to a non-disclosure agreement signed by FLF and the Company. The
Company represents and warrants to FLF that any such information, any reports required by it to be filed by it with any state
or federal authority (collectively “Reports”) and any other information supplied to FLF or Investors by or on
behalf of the Company in connection with the Placement will not contain any materially untrue statement of a material fact or
omit to state a material fact necessary to make the statements therein not misleading. The Company agrees to use its best
efforts to cooperate with FLF in connection with the provision of services by FLF hereunder, including attendance or
participation via phone by appropriate officers or principals of the Company (with reasonable notice and availability) for
meetings coordinated by FLF. 

 

3.           Offering
Materials. The Company, with advice and support provided by FLF, shall prepare disclosure documents to be provided to potential
purchasers of the Shares as offering materials (the "Offering Materials"). The Company represents and warrants to the
best of its knowledge that the Offering Materials will not, as of the Closing Date of the Placement, contain any untrue statement
of material fact or omit to state any material fact required to be stated therein, or necessary to make the statements contained
therein, not misleading. FLF recognizes and acknowledges that it is not authorized to make any representations and statements
to any potential purchaser other than and to the extent that such representations and statements are contained in the Offering
Materials.

 

4.           Term and Termination.
The engagement of FLF shall begin as of the date hereof and continue
indefinitely until (a) the Company raises the total of $42 million of either equity or debt or (b) either Party terminates the
Agreement by providing a 30 day written notice to the other Party. During the Term, either party
hereto may terminate the Agreement by giving 30 days prior written notice to the other party (“Termination Notice”).
Upon expiration or termination of this Agreement, FLF shall have no further obligations to the Company hereunder. If any party
that was first introduced to the Company by FLF during the Term makes an investment in the Company within twenty four (24) months
of termination of the Term, FLF shall be entitled to fees and warrants as outlined in paragraph 5 herein. Any fees due or claimed
by any other placement agents, advisors or representatives of the Company prior to, during or after the Term are solely the responsibility
of the Company. Sections 2, 3, 4, 5, 7, 8, 9, 10, 11, 12, 13, 14 and
15 of this Agreement shall survive termination and remain operative and in full force and effect. 

 

5.           Fees
and Expenses. In consideration for providing the services contemplated herein, the Company agrees to pay FLF the following:

 

			(i) The Company agrees to (a) pay
                                                                               FLF for each of its debt or equity Placements on the initial Closing Date of the Placement, and on the date of any subsequent
                                                                               closing of such Placement, a cash fee (the “Cash Placement Agent Fee”) of seven percent (7%) of the gross
                                                                               proceeds of the debt or equity issue, and (b) issue to FLF,
                                                                               and/or its designees, upon the final closing of the Placement, warrants (the “Placement Agent Warrants”) to
                                                                               purchase an aggregate number of Shares equal to five percent (5%) of the total number of Shares subscribed for in any such
                                                                               equity placement The Placement Agent Warrants shall have a term of five (5) years from the Closing Date of the Placement,
                                                                               have a cashless exercise option in the event of corporate sale or initial public offering of the Company, be exercisable for
                                                                               Shares identical to those sold in the Placement, and have an exercise price per Share equal to the final per-Share offering
                                                                               price of the Shares subscribed for in the Placement; and

 

			(ii) The Company will also reimburse FLF, upon request, for documented expenses
                                                                               (“Out-of-Pocket Expenses”) reasonably and directly incurred in serving as its financial advisor and Placement
                                                                               Agent for the Placement (including travel and reasonable fees and
                                                                               disbursements of FLF’s counsel), which are, in the aggregate, not expected to exceed twenty-five thousand
                                                                               dollars ($25,000).

 

    	 

    	 

    

 

FLF – Vaccinogen, Inc.. Engagement Letter

February 5, 2013

Page 3 of 7

CONFIDENTIAL

  

6.            Obligations Limited.
FLF shall be under no obligation hereunder to make an independent appraisal of assets or investigation or inquiry as to any
information regarding, or any representations of, the Company and shall have no liability hereunder in regard thereto.

 

7.            Indemnification.
The Company agrees to indemnify FLF and its representatives, agents, partners, affiliates, subsidiaries, successors, officers
and directors in accordance with the indemnification provisions set forth in Appendix A, attached hereto and made part hereof.

 

8.            No Liability.
The Company agrees that neither FLF nor any of its partners, affiliates, subsidiaries, successors, directors, agents, employees
or controlling persons shall have any liability to the Company or any person asserting claims on behalf of or in right of the
Company in connection with or as a result of either FLF’s engagement under this Agreement or any matter referred to in this
Agreement, except to the extent that any losses, claims, damages, liabilities or expenses incurred by the Company are determined
by a court of competent jurisdiction to have resulted solely from the gross negligence or willful misconduct of FLF in performing
the services that are the subject of this Agreement.

 

9.            Independent
Contractor. The parties hereto acknowledge and agree that the engagement of FLF hereunder is not intended to confer rights
upon any person (including shareholders, employees or creditors of FLF) not a party hereto as against the Company or its affiliates,
or their respective directors, officers, employees or agents, successors or assigns. FLF shall act as an independent contractor
under this Agreement, and does not create any partnership, joint venture or other similar relationship between the Company and
FLF and any duties arising out of its engagement shall be owed solely
to the Company. FLF shall have no authority to accept any order or to bind or obligate the Company in any way or to renew any
debt or obligation for or on account of the Company without the Company’s prior written consent. As an independent contractor,
FLF will be solely responsible for its income and all other applicable taxes. FLF shall have no restrictions to on its ability
to provide services to companies other than the Company, except as stated herein.

 

10           Severability.
If any provision of this Agreement for any reason shall be held to be illegal, invalid or unenforceable, such illegality
shall not affect any other provision of this Agreement and this Agreement shall be amended so as to enforce the illegal, invalid
or unenforceable provision to the maximum extent permitted by applicable law, and the parties shall cooperate in good faith to
further modify this Agreement so as to preserve to the maximum extent possible the intended benefits to be received by the parties
hereto.

 

11.          Publicity.
With the Company’s prior review and approval, which shall not be unreasonably withheld or delayed,
FLF may, at its own expense, place customary tombstone announcements or advertisements in financial newspapers and
journals describing its services hereunder upon completion of the Placement.

 

12.          Assignment;
Benefit. Neither party hereto, without the explicit prior
written consent of the other may assign this Agreement or, in whole or
in part, the rights and obligations hereunder. The provisions of the Agreement will be binding upon and inure to the benefit of
the parties hereto and then respective heirs, legal representatives, permitted successors and assigns.

 

13.          Entire
Agreement; Amendment; Waiver. This Agreement sets forth the entire understanding of the parties hereto with respect
to the transactions contemplated hereby and supersedes any prior or contemporaneous communications, understandings, arrangements,
discussions and agreements between the parties hereto concerning the subject matter herein. No change, amendment or supplement
to, or waiver of this Agreement will be valid or of any effect, except
by the written agreement of the parties hereto. The waiver of any particular condition, precedent, or provision provided by this
Agreement will not constitute the waiver of any other.

 

    	 

    	 

    

 

FLF – Vaccinogen, Inc.. Engagement Letter

February 5, 2013

Page 4 of 7

CONFIDENTIAL

  

14.          Governing
Law. This Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Pennsylvania
without regard to its conflict of laws provisions. Any action or proceeding brought by either party against the other party arising
out of or related to this Agreement shall be brought exclusively in the courts of the Commonwealth of Pennsylvania located in
Montgomery County, Pennsylvania or in the United States District Court for the Eastern District of Pennsylvania,
which courts shall have exclusive jurisdiction over the adjudication of such matters, and the Company and FLF consent to
the jurisdiction of such courts and personal service with respect thereto. The Company hereby consents to personal jurisdiction,
service and venue in any court in which any claim arising out of or in any way relating to this Agreement is brought by any third
party against FLF or any indemnified party; except as to any third party claim as to which the court before which such third party
claim is pending has determined by final non-appealable order that FLF or an indemnified party is not subject to jurisdiction.
The Company agrees that a final judgment in any such proceeding or counterclaim brought in any such court shall be conclusive
and binding upon the Company and may be enforced in any other courts to the jurisdiction of which the Company is or may be subject,
by suit upon such judgment. Each of FLF and the Company waives all right to trial by jury in any proceeding or counterclaim (whether
based upon contract, tort or otherwise) in any way arising out of or relating to this agreement.

 

15.          Representations.
Each party hereto represents, warrants and covenants to the other party that (a) it has the power and authority to enter into
this Agreement and to perform its respective obligations hereunder, (b) it will comply with all applicable laws, rules and regulations
and (c) that it has all licenses and memberships required to perform obligations and services hereunder. The Company shall be
responsible for any costs and expenses associated with filings, applications or registrations with any governmental or regulatory
body, including, without limitation, those associated with any sales pursuant to Regulation D under the Act, “blue sky”
laws, and the laws of the foreign countries in which the securities will be offered or sold that are required to be made by the
Company. In addition, the Company shall be hereby notified that certain states, most notably the State of New York, may require
“blue sky” filings to be submitted to the respective state securities regulators prior to any solicitation
of investors in such states.

 

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

 

17.           Notices.
Any notice, consent or other communication given pursuant to this Agreement shall be in writing and shall be effective when (i)
delivered personally, (ii) sent by facsimile (with receipt confirmed), provided that a copy is mailed registered mail, return
receipt requested, or (iii) when received by the addressee, if sent by Express Mail, Federal Express or other express delivery
service (receipt requested), in each case to the appropriate addressee set forth below:

 

	If to FLF:   	Mr. Hilary Bergman
	 	First Liberties Financial
	 	369 Lexington Avenue
	 	New York, NY 10017

 

    	 

    	 

    

  

FLF – Vaccinogen, Inc.. Engagement Letter

February 5, 2013

Page 5 of 7

CONFIDENTIAL

 

	If to the Company:	Mr. Andrew L. Tussing
	 	Vaccinogen, Inc.
	 	5300 Westview Drive, Suite 406
	 	Frederick, MD  21703

 

If the foregoing correctly
sets forth your understanding, please so indicate by signing and returning to us one fully executed copy of this Agreement.

Sincerely,

 

	First Liberties Financial	 	 
	 	 	 	 
	By:	/s/ Hilary Bergman	 	 
	 	Hilary Bergman	 	 
	 	President	 	 
	 	 	 	 
	Intending to be legally bound the foregoing	 	 
	Is Confirmed and Agreed to by:	 	 
	 	 	 	 
	Vaccinogen, Inc.	 	 
	 	 	 	 
	By:	/s/ Andrew L. Tussing	 	Date:  26 February 2013
	Name:	Andrew L. Tussing	 	 
	Title:	President	 	 
		 	 	 
	By:	/s/ Michael G. Hanna	 	Date:  26 February 2013
	Name:	Michael G. Hanna, Jr., Ph.D.	 	 
	Title:	Chief Executive Officer	 	 

 

    	 

    	 

    

 

 

FLF – Vaccinogen, Inc.. Engagement Letter

February 5, 2013

Page 6 of 7

CONFIDENTIAL

 

APPENDIX A

INDEMNIFICATION

 

The Company agrees to indemnify and hold
harmless First Liberties Financial and its affiliates (as defined in Rule 405 under the Securities Act of 1933, as amended) and
their respective directors, officers, employees, agents, consultants and controlling persons (FLF) and each such person being
an “Indemnified Party”) from and against all losses, claims, damages and liabilities (or actions, including shareholder
actions, in respect thereof), joint or several, to which such Indemnified Party may become subject under any applicable federal
or state law, or otherwise, which are related to or result from the performance by FLF of the services contemplated by, or the
engagement of FLF pursuant to, this Agreement and will promptly reimburse any Indemnified Party for all reasonable expenses (including
reasonable counsel fees and expenses) as they are incurred in connection with the investigation of, preparation for or defense
arising from any threatened or pending claim, whether of not such Indemnified Party is a party and whether or not such claim,
action or proceeding is initiated or brought by the Company. The Company will not be liable to any Indemnified Party under the
foregoing indemnification and reimbursement provisions, (i) for any settlement by an Indemnified Party effected without its prior
written consent (not to be unreasonably withheld); or (ii) to the extent that any loss, claim, damage or liability is found in
a final, non-appealable judgment by a court of competent jurisdiction to have resulted primarily from FLF’s willful misconduct
or gross negligence. The Company also agrees that no Indemnified Party shall have any liability (whether direct or indirect, in
contract or tort or otherwise) to the Company or its security holders or creditors related to or arising out of the engagement
of FLF pursuant to, or the performance by FLF of the services contemplated by, this Agreement except to the extent that any loss,
claim, damage or liability is found in a final, non-appealable judgment by a court of competent jurisdiction to have resulted
primarily from FLF’s willful misconduct or gross negligence.

 

Promptly after receipt
by an Indemnified Party of notice of any intention or threat to commence an action, suit or proceeding or notice of the commencement
of any action, suit or proceeding, such Indemnified Party will, if a claim in respect thereof is to be made against the Company
pursuant hereto, promptly notify the Company in writing of the same. In case any such action is brought against any Indemnified
Party and such Indemnified Party notifies the Company of the commencement thereof, the Company may elect to assume the defense
thereof, with counsel reasonably satisfactory to such Indemnified Party, and an Indemnified Party may employ counsel to participate
in the defense of any such action, provided that the employment of such counsel shall be at the Indemnified Party’s own
expense, unless (i) the employment of such counsel has been authorized in writing by the Company, (ii) the Indemnified Party has
reasonably concluded (based upon advice of counsel to the Indemnified Party) that there may be legal defenses available to it
or other Indemnified Parties that are different from or in addition to those available to the Company, or that a conflict or potential
conflict exists (based upon advice of counsel to the Indemnified Party) between the Indemnified Party and the Company that makes
it impossible or inadvisable for counsel to the Indemnifying Party to conduct the defense of both the Company and the Indemnified
Party (in which case the Company will not have the right to direct the defense of such action on behalf of the Indemnified Party),
or (iii) the Company has not in fact employed counsel reasonably satisfactory to the Indemnified Party to assume the defense of
such action within a reasonable time after receiving notice of the action, suit or proceeding, in each of which cases the reasonable
fees, disbursements and other charges of such counsel will be at the expense of the Company; provided, further, that in no event
shall the Company be required to pay fees and expenses for more than one firm of attorneys representing Indemnified Parties unless
the defense of one Indemnified Party is unique or separate from that of another Indemnified party subject to the same claim or
action. Any failure or delay by an Indemnified Party to give the notice referred to in this paragraph shall not affect such Indemnified
Party’s right to be indemnified hereunder, except to the extent that such failure or delay causes actual harm to the Company,
or prejudices its ability to defend such action, suit or proceeding on behalf of such Indemnified Party.

 

    	 

    	 

    

 

 

FLF – Vaccinogen, Inc.. Engagement Letter

February 5, 2013

Page 7 of 7

CONFIDENTIAL

 

If the indemnification
provided for in this Agreement is for any reason held unenforceable by an Indemnified Party, the Company agrees to contribute
to the losses, claims, damages and liabilities for which such indemnification is held unenforceable (i) in such proportion as
is appropriate to reflect the relative benefits to the Company, on the one hand, and FLF on the other hand, of the Placement as
contemplated whether or not the Placement is consummated or, (ii) if (but only if) the allocation provided for in clause (i) is
for any reason unenforceable, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause
(i) but any other relevant equitable considerations. The Company agrees that for the purposes of this paragraph the relative benefits
to the Company and FLF of the Placement as contemplated shall be deemed to be in the same proportion that the total value received
or contemplated to be received by the Company or its shareholders, as the case may be, as a result of or in connection with the
Placement bear to the fees paid or to be paid to FLF under this Agreement. Notwithstanding the foregoing, the Company expressly
agrees that FLFshall not be required to contribute any amount in excess of the amount by which fees paid FLF hereunder (excluding
reimbursable expenses), exceeds the amount of any damages which FLF has otherwise been required to pay.

 

The Company agrees
that without FLF’s prior written consent, which shall not be unreasonably withheld, it will not settle, compromise or consent
to the entry of any judgment in any pending or threatened claim, action or proceeding in respect of which indemnification could
be sought under the indemnification provisions of this Agreement (in which FLF or any other Indemnified Party is an actual or
potential party to such claim, action or proceeding), unless such settlement, compromise or consent includes an unconditional
release of each Indemnified Party from all liability arising out of such claim, action or proceeding.

 

In the event that
an Indemnified Party is requested or required to appear as a witness in any action brought by or on behalf of or against the Company
in which such Indemnified Party is not named as a defendant, the Company agrees to promptly reimburse FLF on a monthly basis for
all expenses incurred by it in connection with such Indemnified Party’s appearing and preparing to appear as such a witness,
including, without limitation, the reasonable fees and disbursements of its legal counsel.

 

If multiple claims
are brought with respect to at least one of which indemnification is permitted under applicable law and provided for under this
Agreement, the Company agrees that any judgment of arbitrate award shall be conclusively deemed to be based on claims as to which
indemnification is permitted and provided for, except to the extent the judgment or arbitrate award expressly states that it,
or any portion thereof, is based solely on a claim as to which indemnification is not available.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00219-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00219-of-00352.parquet"}]]