Document:

Exhibit 10.4

Exhibit 10.4

THIS AMENDED AND RESTATED PROMISSORY NOTE HAS BEEN ACQUIRED FOR INVESTMENT AND HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR QUALIFIED UNDER ANY STATE SECURITIES
LAWS. THIS AMENDED AND RESTATED PROMISSORY NOTE MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF
SUCH REGISTRATION OR QUALIFICATION OR AN EXEMPTION THEREFROM UNDER SAID ACT AND ANY APPLICABLE
STATE SECURITIES LAWS.

THIS AMENDED AND RESTATED PROMISSORY NOTE IS SUBJECT TO RESTRICTIONS ON TRANSFER CONTAINED IN THAT
CERTAIN NOTE AND WARRANT PURCHASE AGREEMENT, DATED MARCH 26, 2010, AS AMENDED BY THAT OMNIBUS
AMENDMENT, DATED NOVEMBER 15, 2010, WHICH RESTRICTIONS ON TRANSFER ARE INCORPORATED HEREIN BY
REFERENCE.

AMENDED AND RESTATED PROMISSORY NOTE

			
	 	 	 
	Up to $126,600
	 	Original issuance on March 26, 2010
	 
	 	Amended and restated on November 15, 2010
	 
	 	San Francisco, California

FOR VALUE RECEIVED, VIA Pharmaceuticals, Inc., a Delaware corporation (the “Company”),
promises to pay to the order of Bay City Capital Fund IV Co-Investment Fund, L.P. or its registered
assigns (“Holder”), the principal amount outstanding from time to time under this Amended
and Restated Promissory Note (as amended or restated from time to time, this “Note”), with
interest, on the outstanding principal amount at the rate of fifteen percent (15%) per annum
(computed on the basis of actual calendar days elapsed and a year of 365 days) or, if less, at the
highest rate of interest then permitted under applicable law; provided, however, that from and
after an Event of Default (as defined below), the outstanding principal balance under this Note
from time to time shall accrue interest at the rate of eighteen percent (18%) per annum (computed
on the basis of actual calendar days elapsed and a year of 365 days) or, if less, at the highest
rate permitted by applicable law (the “Post-Default Rate”). Interest shall commence with
the date hereof and shall continue on the outstanding principal of this Note until paid.

1. Definitions. For purposes of this Note, the following terms shall have the
following meanings (capitalized terms used herein but not otherwise defined shall have the meanings
provided therefor in that certain Note and Warrant Purchase Agreement dated as of March 26, 2010,
as amended by that Omnibus Amendment, dated as of November15, 2010 (the “Agreement”) by and
among the Company and the investors set forth on Schedule A thereto):

“Business Day” means any day which is not a Saturday or Sunday or a legal holiday on
which banks are authorized or required to be closed in San Francisco, California.

 

 

 

“Collateral” shall have the meaning assigned to such term in the Security Agreement.

“Control” shall mean the possession, directly or indirectly, of the power to direct or
cause the direction of the management or policies of a person, whether through the ownership of
voting securities, by contract or otherwise, and the terms “Controlling” and
“Controlled” (and the lower-case versions of the same) shall have meanings correlative
thereto.

“Convertible Securities” shall mean evidences of Debt, shares of stock or other
securities or instruments which are convertible into or exchangeable for shares of common stock,
either immediately or upon the arrival of a specified date or the occurrence of a specified event.

“Debt” shall mean all liabilities, obligations and indebtedness of every kind and
nature of any Person, including, without limitation: (1) indebtedness or liability for borrowed
money, or for the deferred purchase price of property or services (including trade obligations);
(2) obligations as lessee under any leases (including under any capital leases); (3) any
reimbursement or other obligations under any performance or surety bonds or any letters of credit
issued for the account of such Person; (4) all net obligations in respect of any derivative
products; (5) all guaranties, endorsements (other than for collection or deposit in the ordinary
course of business), and other contingent obligations to purchase, to provide funds for payment, to
supply funds to invest in any other Person, or otherwise to assure a creditor against loss; and (6)
obligations secured by any Lien on property owned by such Person, whether or not the obligations
have been assumed.

“GAAP” means generally accepted accounting principles in the United States,
consistently applied.

“Governmental Authority” shall mean any federal, state, local or other governmental
department, commission, board, bureau, agency or other instrumentality or authority, domestic or
foreign, exercising executive, legislative, judicial, regulatory or administrative authority or
functions of or pertaining to government.

“Lien” shall mean any security interest, mortgage, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or other), claim or other priority or
preferential arrangement of any kind or nature whatsoever (other than a financing statement filed
by a lessor in respect of an operating lease not intended as security).

“Material Adverse Effect” shall mean event, matter, condition or circumstance which
(i) has or would reasonably be expected to have a material adverse effect on the business,
properties, results of operations, condition (financial or otherwise) or prospects of the Company;
(ii) would materially impair the ability of the Company, or any other Person to perform or observe
its obligations under or in respect of the Transaction Documents; or (iii) affects the legality,
validity, binding effect or enforceability of any of the Transaction Documents or the perfection or
priority of any Lien granted to the Investor under any of the Collateral Documents.

“Obligations” shall mean all obligations of the Company to Holder howsoever created,
arising or evidenced, whether direct or indirect, joint or several, absolute or contingent, or now
or hereafter existing, or due or to become due, which arise out of or in connection with this Note,
the Collateral Documents and each other related document including, without limitation, all costs
and expenses incurred by Holder in connection with the enforcement of this Note or the
Collateral Documents.

 

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“Options” shall mean any rights or options to subscribe for or to purchase common
stock or Convertible Securities.

“Permitted Debt” shall mean the Obligations, trade accounts payable incurred in the
ordinary course which are due no later than 90 calendar days after invoice, other current
liabilities incurred in the ordinary course of business and not incurred through the borrowing of
money or the obtaining of credit, obligations under long-term real property leases incurred in the
ordinary course of business, short-term lease obligations of the Company in an amount per annum not
exceeding $75,000 in the aggregate, Debt incurred to finance the cost of tangible personal property
(which was acquired after the date hereof, and the cost of which, individually or in the aggregate,
does not exceed $75,000), Debt in respect of taxes or other governmental charges which is not yet
due or which is being contested in good faith by appropriate proceedings, and any refinancing,
extension or renewal of any existing Debt permitted hereunder not involving an increase in the
principal amount thereof.

“Permitted Liens” shall mean, as of any particular time, (a) Liens of taxes,
assessments or other charges of an Governmental Authority not then delinquent or being contested as
provided below, (b) Liens created in favor of the Investor pursuant to the Collateral Documents,
(c) any mechanic’s, worker’s, repairer’s, supplier’s, vendor’s or like Liens securing obligations
arising in the ordinary course of business that (i) are not mature and not overdue, or (ii) both
(x) are being contested in good faith and (y) as to which adequate reserves have been established
on the books of the Company in accordance with GAAP or (z) that do not materially impair the value
of value of the Collateral provided to the Investor pursuant to the Collateral Documents and could
not result in an aggregate liability in excess of $75,000, (d) Liens upon tangible personal
property (which was acquired after the date hereof, and the cost of which, individually or in the
aggregate, does not exceed $75,000) granted by the Company, each of which Liens was created solely
to secure Debt incurred to finance the cost of such property (provided that no such Lien shall
extend to cover any property other than the property so acquired), (e) Liens arising solely by
virtue of any statutory or common law provision relating to banker’s liens, rights of set-off or
similar rights and remedies as to deposit accounts or other funds maintained with a creditor
depository institution, provided that such deposit account is not a dedicated cash
collateral account, and (f) any Liens disclosed in writing to Holder and existing as of the date of
the Initial Closing under the Agreement. A contest referred to in this definition shall be
permitted only if the execution or enforcement of the Lien being contested shall have been stayed
as a result thereof and such contest could not be reasonably be expected to have a Material Adverse
Effect.

“Person” shall mean an individual, a partnership, a corporation, a limited liability
company, an association, a joint stock company, a trust, a joint venture, an unincorporated
organization and a governmental entity or any department, agency or political subdivision thereof.

“Subsidiary” shall mean, with respect to any Person (herein referred to as the
“parent”), any corporation, limited liability company, partnership, association or other
business entity (a) of which securities of other ownership interests representing more than 50% of
the equity or more
than 50% of the ordinary voting power or more than 50% of the general partnership interests
are, at the time any determination is being made, owned, Controlled or held by the parent, or (b)
that is, at any time any determination is made, otherwise Controlled by, the parent or one or more
Subsidiaries of the parent and one or more Subsidiaries of the parent.

 

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2. Note and Warrant Purchase Agreement. This Note is issued pursuant to the terms of
the Agreement.

3. Principal; Drawdowns.

(a) The principal of this Note shall equal the advances made by Holder to the Company from
time to time. On the date of the Initial Closing, the Company received an advance on this Note of
an amount equal to $26,375 (the “Initial Drawdown”). On the date hereof, the outstanding
principal balance hereunder is $67,549. The Company may request additional drawdown advances
(each, an “Additional Drawdown” and, together with the Initial Drawdown, a
“Drawdown”) thereafter on this Note up to a maximum aggregate principal amount of $126,600
(including the $67,549 outstanding on the date hereof). Holder may, in its sole discretion,
determine whether to accept or reject such additional drawdown request from the Company.

(b) The Company shall provide Holder at least ten Business Days prior written notice of the
Company’s intention to drawdown any additional advances on this Note. If Holder accepts such
additional drawdown request, it shall notify the Company in writing of such acceptance within such
ten Business Day period.

(c) Each Drawdown shall be recorded on the grid in Schedule 1 hereto. The Company
hereby authorizes Holder to record on the grid in Schedule 1 hereto all advances,
repayments, prepayment and unpaid principal balance on this Note from time to time to reflect the
Initial Drawdown and any Additional Drawdown.

4. Maturity. Unless sooner paid, the entire unpaid principal amount and all unpaid
accrued interest shall become fully due and payable on the earliest of (i) December 31, 2010, and
(ii) the acceleration of the maturity of this Note by Holder upon the occurrence of an Event of
Default (such earliest date, the “Maturity Date”).

5. Payments.

(a) Form of Payment. All payments of interest and principal shall be in accordance
with Section 20 herein.

(b) Interest Payments. The Company shall pay to Holder accrued and unpaid interest on
the Maturity Date. Interest at the rate first set forth above shall accrue on any interest which
has not been paid on the date on which it is payable until such time as payment therefor is
actually delivered to Holder.

(c) Prepayment. The Company shall have the right to prepay any and all amounts owed
under this Note in whole or in part at any time without notice.

(d) Collateral Documents. The Company’s obligations hereunder shall be secured
pursuant to the Collateral Documents.

 

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6. Repayment Upon Maturity. All outstanding Obligations under this Note shall become
immediately due and payable on the Maturity Date.

7. Repayment Upon Acquisition or Financing. In the event that the Company sells,
conveys, licenses or otherwise disposes of a majority of its assets or is acquired by way of a
merger, consolidation, reorganization or other transaction or series of transactions pursuant to
which stockholders of the Company prior to such acquisition own less than fifty percent (50%) of
the voting interests in the surviving or resulting entity (each, an “Acquisition”), then
all outstanding Obligations under this Note shall, at the option of Holder, become immediately due
and payable upon the closing of the Acquisition, senior in preference to any payment in respect of
any other equity or debt security of the Company. In the event that the Company closes a Debt,
equity or combined Debt or equity financing resulting in gross proceeds or available credit to the
Company of not less than $20,000,000, including the gross proceeds from this Note to the extent
that any amounts owing hereunder are converted into Debt or equity in connection with such
financing (a “Financing”), then all of the remaining outstanding Obligations under this
Note shall, at the option of Holder, become immediately due and payable upon the closing of such
financing.

8. Affirmative Covenants. So long as any Obligations under this Note remain
outstanding, the Company shall:

(a) Compliance with Laws. Comply in all material respects with applicable laws,
rules, regulations and orders, such compliance to include, without limitations, paying before the
same become delinquent all taxes, assessments, and charges imposed upon it or upon its property by
any Governmental Authority except for good faith contests for which adequate reserves are being
maintained.

(b) Information. Deliver to Holder or cause to be delivered to Holder, in form and
detail satisfactory to Holder, the following financial and other information:

(i) as soon as available but no later than 90 days after and as of the end of each fiscal
year, the Company’s annual audited financial statements, accompanied by an unqualified report
thereon of independent certified public accountants selected by the Company and reasonably
satisfactory to Holder (all such financial statements to be delivered pursuant to this subsection
(b)(i) to be prepared in accordance with GAAP);

(ii) as soon as available but no later than 30 days after and as of the end of each fiscal
quarter, the Company’s quarterly unaudited financial statements (all such financial statements to
be delivered pursuant to this subsection (b)(ii) to be prepared in accordance with GAAP);

(iii) concurrently with delivery to the equity investors of the Company, any and all operating
and financial information, or other communications, delivered, from time to time, to such equity
investors;

 

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(iv) written notice of any of the following, promptly, and in any event within three (3) days
after the Company becomes aware of any of the following: (i) any proceeding being instituted or
threatened by or against it involving a sum in excess of the Threshold Amount (as defined below) in
the aggregate for all proceedings, (ii) any order, judgment or decree being entered against the
Company or any of its properties or assets involving a sum in excess of the Threshold Amount in the
aggregate for all such orders, judgments and decrees, and (iii) any actual or prospective change,
development or event which has had or could reasonably be expected to have a Material Adverse
Effect; and

(v) such other statements, lists of property and accounts, budgets, forecasts, projections,
reports, or other information as Holder may from time to time reasonably request.

(c) Notice of Litigation. Provide to Holder promptly after the commencement thereof,
notice of all actions, suits, and proceedings before any court or Governmental Authority affecting
the Company.

(d) Notice of Defaults and Events of Defaults. Provide to Holder, as soon as possible
and in any event within three (3) days after the occurrence thereof, with written notice of each
event which either (i) is an Event of Default, or (ii) with the giving of notice or lapse of time
or both would constitute an Event of Default, in each case setting forth the details of such event
and the action which is proposed to be taken by the Company with respect thereto.

(e) Governmental Approvals. Promptly obtain and maintain any and all authorizations,
consents, approvals, licenses, franchises, concessions, leases, rulings, permits, certifications,
exemptions, filings or registrations by or with any Governmental Authority material and necessary
for the Company to conduct its business and own (or lease) its properties or to execute, deliver
and perform the Transaction Document.

(f) Insurance. Promptly obtain and maintain in full force and effect at all times
with responsible insurance companies such insurance covering its assets and properties, in such
amounts and against such risks and with such deductibles as an enterprise conducting a similar
business under similar business conditions as the Company would customarily maintain.

(g) Continuance of Business. Maintain its legal existence, licenses and privileges in
good standing under and in compliance with all applicable laws and continue to operate the business
currently conducted by the Company. Without limiting the generality of the foregoing, the Company
shall do and cause to be done all things necessary to apply for, preserve, maintain and keep in
full force and effect all of its registrations of trademarks, service marks and other marks, trade
names and other trade rights, patents, copyrights and other intellectual property in accordance
with prudent business practices.

(h) Maintenance. Conduct its business in a manner consistent with relevant industry
standards, keep its material assets and properties in good working order and condition, make all
needful and proper repairs, replacements and improvements thereof, and pay when due all amounts
payable in the course of ordinary operation of the business of the Company (or, in the case of
trade accounts payable, pay such amounts payable in the ordinary course within 90
calendar days after invoice), so that such business may be properly and prudently conducted at
all times.

 

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(i) Taxes. Pay and discharge (i) all federal and other material taxes, fees,
assessments and governmental charges or levies imposed upon it or upon its properties or assets
prior to the date on which penalties attach thereto, and all lawful claims for labor, materials and
supplies which, if unpaid, might become a Lien upon any of its properties or assets, except to the
extent such taxes, fees, assessments or governmental charges or levies, or such claims, are being
contested in good faith by appropriate proceedings and are adequately reserved against in
accordance with GAAP; and (ii) all other lawful claims which, if unpaid, would by law become a Lien
upon its property not constituting a Permitted Lien.

9. Negative Covenants. So long as any Obligations under this Note remain outstanding,
the Company shall not take any of the following actions, unless such action was unanimously
approved by the Company’s Board of Directors:

(a) Liens. Create or suffer to exist any Lien on any assets of the Company except
Permitted Liens.

(b) Debt. Incur any Debt other than Permitted Debt; prepay, redeem, purchase, defease
or otherwise satisfy in any manner prior to the scheduled repayment thereof any Permitted Debt
(other than amounts due or permitted to be prepaid in respect of the Notes); or amend, modify or
otherwise change the terms of any Permitted Debt (other than the Notes) so as to accelerate the
scheduled repayment thereof.

(c) Merger. Enter into any consolidation, merger, or other combination, or become a
partner in a partnership, a member of a joint venture, or a member of a limited liability company.

(d) Sale of Assets. Sell, license, transfer or otherwise dispose of any interest in
any of the Company’s assets except as provided for under the Security Agreement.

(e) Acquisitions and Investments. Acquire or commit or agree to acquire all or any
stock, securities or assets of any other Person, other than inventory and equipment acquired in the
ordinary course of business, or make any loans to or other investments in any other Person, other
than in the ordinary course of business.

(f) Distributions. Declare or pay any dividends or make any distribution of any kind
on the Company’s capital stock, or purchase, redeem or otherwise acquire, directly or indirectly,
any shares of the Company’s capital stock, any Options, any Convertible Securities or other rights
to acquire shares of capital stock of the Company, except for the repurchase of such securities
from former employees of or consultants to the Company at the original issue price paid therefor
pursuant to contractual rights of the Company upon the termination of such employees’ or
consultants’ employment by or provision of service to the Company.

(g) Additional Issuances. Issue, designate or authorize the issuance of any shares of
capital stock of the Company or any security or other instrument convertible into capital stock of
the Company; permit any such issuance, designation, or authorization of issuance with respect to
any subsidiary of the Company; or form any Subsidiary.

 

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(h) Changes in Business. Enter into or engage in any business other than that carried
on (or contemplated to be carried on) as of the date of the Initial Closing.

(i) Operating Leases. The Company shall not make any expenditures in respect of
operating leases, except for: (i) operating leases between the Company and any of its wholly owned
Subsidiaries or between any of its wholly owned Subsidiaries; and (ii) operating leases entered
into or assumed by the Company in the ordinary course of business.

(j) Capital Expenditures. The Company shall not make or become legally obligated to
make any expenditure in respect of the purchase or other acquisition of any fixed or capital asset
(including obligations under any capital lease, but excluding any expenditures in respect of any
normal replacements and maintenance which are properly charged to current operations), except for
capital expenditures in the ordinary course of business not exceeding $75,000, on a consolidated
basis, in any fiscal year.

(k) Subsidiaries. Cause or permit any direct or indirect Subsidiary of the Company to
(i) acquire or hold any material assets or (ii) engage in any business activities, except (in
either case) without the prior written approval of Holder.

10. Use of Proceeds. The Company shall use the proceeds from this Note for general
corporate purposes, excluding any payment of dividends, repurchase of capital stock or repayment of
Debt of the Company or of any subsidiary of the Company (other than as provided herein or in any
other Transaction Document, and other than Permitted Debt).

11. Default.

(a) Events of Default. For purposes of this Note, any of the following events which
shall occur shall constitute an “Event of Default”:

(i) any Obligation under this Note is not paid when and as the same shall become due and
payable, whether at maturity, by acceleration, or otherwise;

(ii) default shall occur in the observance or performance of (A) any covenant, obligation or
agreement of the Company contained in Sections 9 or 10, or (B) any other provision of this Note,
the Agreement or any of the Collateral Documents and any such default shall continue uncured for a
period of five (5) days after the Company knew or should have known, exercising reasonable
diligence, of the event or circumstances giving rise to such default; or any “Event of
Default” shall exist under any Collateral Document;

(iii) any representation, warranty or certification made by the Company herein or in the
Agreement or the Collateral Documents or in any certificate, report, document, agreement or
instrument delivered pursuant to any provision hereof or thereof shall prove to have been false or
incorrect in any material respect on the date or dates as of which made (any such falsity being a
“Representation Default”) and, to the extent the event or circumstances giving rise to such
Representation Default is amenable to being cured such that the Representation Default would no
longer exist, such Representation Default shall continue uncured for a period of five (5) days
after the Company knew or should have known, exercising reasonable diligence, of the event or
circumstances giving rise to such Representation Default;

 

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(iv) the Company shall (A) apply for or consent to the appointment of a receiver, trustee,
custodian or liquidator of itself or any part of its property, (B) become subject to the
appointment of a receiver, trustee, custodian or liquidator for itself or any part of its property
if such appointment is not terminated or dismissed within thirty (30) days, (C) make an assignment
for the benefit of creditors, (D) fail generally or admit in writing to its inability to pay its
debts as they become due, (E) institute any proceedings under the United States Bankruptcy Code or
any other federal or state bankruptcy, reorganization, receivership, insolvency or other similar
law affecting the rights of creditors generally, or file a petition or answer seeking
reorganization or an arrangement with creditors to take advantage of any insolvency law, or file an
answer admitting the material allegations of a bankruptcy, reorganization or insolvency petition
filed against it, or (F) become subject to any involuntary proceedings under the United States
Bankruptcy Code or any other federal or state bankruptcy, reorganization, receivership, insolvency
or other similar law affecting the rights of creditors generally, which proceeding is not dismissed
within thirty (30) days of filing, or have an order for relief entered against it in any proceeding
under the United States Bankruptcy Code;

(v) the Company shall (i) liquidate, wind up or dissolve (or suffer any liquidation, wind-up
or dissolution), (ii) suspend its operations other than in the ordinary course of business, or
(iii) take any action to authorize any of the actions or events set forth above in this Section
11(a)(v);

(vi) any final judgment or judgments for the payment of money aggregating in excess of $75,000
(the “Threshold Amount”) shall be rendered against the Company which judgments are not,
within 30 days after the entry thereof, bonded, discharged or stayed pending appeal, or are not
discharged within 30 days after the expiration of such stay;

(vii) (A) any Debt of the Company (other than any prior indebtedness of the Company to the
Holder and any trade payables) shall not be paid at its stated maturity or shall be duly declared
to be or shall become due and payable prior to the stated maturity thereof, or (B) there shall
occur and be continuing any default or event of default under any agreement or instrument relating
to any such Debt (other than any prior indebtedness of the Company to the Holder and any trade
payables), or (C) the holder or holders of such Debt, or any trustee, agent or other representative
on behalf of such holder or holders, shall have demanded or required, pursuant to the terms of any
agreement or instrument relating to such Debt (other than any prior indebtedness of the Company to
the Holder or any trade payables), that the Company redeem, repurchase or otherwise acquire or
retire such Debt for value at any time prior to its stated maturity;

(viii) upon the 60th day following written notice from the Holder to the Company
demanding payment of any prior indebtedness of the Company to the Holder arising out of any default
under such prior indebtedness;

(ix) there shall fail, at any time, to be sufficient authorized shares of Common Stock of the
Company to permit the issuance of that number of shares of Common Stock for which all of the
Warrants are exercisable (assuming full vesting thereof); or

(x) the occurrence or existence of any event or condition that, in Holder’s reasonable
judgment, would have or could result in a Material Adverse Effect.

 

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(b) Consequences of Events of Default.

(i) If any Event of Default shall occur for any reason, whether voluntary or involuntary, and
be continuing, Holder may, upon notice or demand, declare the outstanding Obligations under this
Note to be due and payable, whereupon the outstanding Obligations under this Note shall be and
become immediately due and payable, and the Company shall immediately pay to Holder all such
Obligations. Upon the occurrence of an actual or deemed entry of an order for relief with respect
to the Company under the United States Bankruptcy Code, then all Obligations under this Note shall
automatically be due immediately without notice of any kind. The Company agrees to pay Holder all
reasonable out-of-pocket costs and expenses incurred by Holder in any effort to collect Obligations
under this Note, including attorneys’ fees, and to pay interest at the lesser of (A) Post-Default
Rate hereunder and (B) the highest rate permitted by applicable law, on such costs and expenses to
the extent not paid when demanded.

(ii) Holder shall also have any other rights which Holder may have been afforded under any
contract or agreement at any time and any other rights which Holder may have pursuant to applicable
law. Holder may exercise any and all of its remedies under the Collateral Documents and the other
Transaction Documents contemporaneously or separately from the exercise of any other remedies
hereunder or under applicable law.

12. Lost, Stolen, Destroyed or Mutilated Notes. In case any Note shall be mutilated,
lost, stolen or destroyed, the Company shall issue a new Note of like date, tenor and denomination
and deliver the same in exchange and substitution for and upon surrender and cancellation of any
mutilated Note, or in lieu of any Note lost, stolen or destroyed, upon receipt of evidence
satisfactory to the Company of the loss, theft or destruction of such Note.

13. Transferability of Note; Agent.

(a) Subject to compliance with applicable federal and state securities laws and the transfer
restrictions set forth in Section 3.4 of the Agreement under which this Note was issued,
this Note and all rights hereunder may be transferred, in whole or in part, without charge to
Holder hereof (except for transfer taxes), upon surrender of this Note properly endorsed and in
compliance with the provisions of the Agreement. Each taker and holder of this Note, by taking or
holding the same, consents and agrees that this Note, when endorsed in blank, shall be deemed
negotiable, and that the holder hereof, when this Note shall have been so endorsed, may be treated
by the Company, at the Company’s option, and all other persons dealing with this Note as the
absolute owner hereof for any purpose and as the person entitled to exercise the rights represented
by this Note, or to the transfer hereof on the books of the Company and notice to the contrary
notwithstanding; but until such transfer on such books, the Company may treat the registered owner
hereof as the owner for all purposes. Upon any such transfer, a new Note, in substantially the
form of this Note (the “New Note”), evidencing the portion of this Note so transferred,
shall be issued to the transferee and a New Note evidencing the remaining portion of this Note not
so transferred, if any, shall be issued to the transferring Holder. The acceptance of
the New Note by the transferee thereof shall be deemed the acceptance by such transferee of all of
the rights and obligations of a holder of a Note.

 

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(b) As a condition to any transfer of this Note, the original Holder of this Note, the
proposed transferee of this Note, and the Company shall enter into an agency agreement in a form
mutually agreeable to the parties thereto, which provides for the appointment of, and duties and
responsibilities of, the original Holder of this Note as agent, and which shall provide that
observance of any term of this Note and all Notes issued pursuant to the Agreement or pursuant to
any transferee may be waived (either generally or in a particular instance and either retroactively
or prospectively) with holders representing at least a majority of the aggregate principal amount
of the Notes issued by the Company at such time.

14. Governing Law. This Note is to be construed in accordance with and governed by
the laws of the State of California.

15. Amendment and Waiver. Any term of this Note may be amended only with the written
consent of the Company and Holder. The observance of any term of this Note may be waived (either
generally or in a particular instance and either retroactively or prospectively) only with the
written consent of persons then holding at least a majority of the aggregate principal amount of
the Note.

16. Notices. Except as may be otherwise provided herein, all notices, requests,
waivers and other communications made pursuant to this Note shall be made in accordance with
Section 5.6 of the Agreement.

17. Severability. If one or more provisions of this Note are held to be unenforceable
under applicable law, such provision shall be excluded from this Note and the balance of the Note
shall be interpreted as if such provision were so excluded and shall be enforceable in accordance
with its terms.

18. Assignment. The Company shall not have the right to assign its rights and
obligations hereunder or any interest herein.

19. Remedies Cumulative; Failure or Indulgence Not a Waiver. The remedies provided in
this Note shall be cumulative and in addition to all other remedies available under this Note and
any of the other Transaction Documents. No failure or delay on the part of Holder in the exercise
of any power, right or privilege hereunder shall operate as a waiver thereof, nor shall any single
or partial exercise of any such power, right or privilege preclude other or further exercise
thereof or of any other right, power or privilege.

20. Payments. Whenever any payment of cash is to be made by the Company to any Person
pursuant to this Note, such payment shall be made in lawful money of the United States of America
by a check drawn on the account of the Company and sent via overnight courier service to such
Person at such address as previously provided to the Company in writing (which address, in the case
of Holder as of the date of issuance hereof, shall initially be the address for Holder as set forth
in the Agreement); provided that Holder may elect to receive a payment of cash via wire transfer of
immediately available funds by providing the Company with prior written notice setting out such
request and Holder’s wire transfer instructions. Whenever any
payment to be made shall otherwise be due on a day which is not a Business Day, such payment
shall be made on the immediately succeeding Business Day and such extension of time shall be
included in the computation of accrued interest.

 

11

 

21. Excessive Interest. Notwithstanding any other provision herein to the contrary,
this Note is hereby expressly limited so that the interest rate charged hereunder shall at no time
exceed the maximum rate permitted by applicable law. If, for any circumstance whatsoever, the
interest rate charged exceeds the maximum rate permitted by applicable law, the interest rate shall
be reduced to the maximum rate permitted, and if Holder shall have received an amount that would
cause the interest rate charged to be in excess of the maximum rate permitted, such amount that
would be excessive interest shall be applied to the reduction of the principal amount owing
hereunder (without charge for prepayment) and not to the payment of interest, or if such excessive
interest exceeds the unpaid balance of principal, such excess shall be refunded to the Company.

22. Waiver of Notice. To the extent permitted by law, the Company hereby waives
demand, notice, protest and all other demands and notices in connection with the delivery,
acceptance, performance, default or enforcement of this Note and the Transaction Documents.

 

12

 

IN WITNESS WHEREOF, the Company has caused this Note to be duly executed by its officers,
thereunto duly authorized as of the date first above written.

	 	 	 	 	 
	 	VIA PHARMACEUTICALS, INC.

 	 
	 	By:  	/s/
Karen S. Wright	 
	 	 	Name:  	Karen S. Wright 	 
	 	 	Title:  	Vice President, Controller 	 
	 
	 	Address:

VIA Pharmaceuticals, Inc.

750 Battery Street, Suite 330

San Francisco, California 94111

Attention: Vice President, Controller

Facsimile: (415) 283-2214

Electronic mail: Karen.Wright@viapharmaceuticals.com

[Signature page to Note for Bay City Capital Fund IV Co-Investment Fund, L.P.]

 

13

 

SCHEDULE 1

Outstanding Note Balance for Note issued to

Bay City Capital Fund IV Co-Investment Fund, L.P.

(November 15, 2010)

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Accrued Interest	 	 	 	 
	Date	 	Drawdown	 	 	Prepayment	 	 	Unpaid Principal	 	 	through 11/14/10	 	 	Outstanding Principal	 
	3/29/10
	 	$	26,375	 	 	 	—	 	 	 	—	 	 	$	2,504	 	 	$	26,375	 
	5/26/10
	 	$	2,110	 	 	 	—	 	 	$	26,375	 	 	$	150	 	 	$	28,485	 
	6/4/10
	 	$	4,220	 	 	 	—	 	 	$	28,485	 	 	$	284	 	 	$	32,705	 
	6/29/10
	 	$	6,330	 	 	 	—	 	 	$	32,705	 	 	$	362	 	 	$	39,035	 
	7/15/10
	 	$	2,110	 	 	 	—	 	 	$	39,035	 	 	$	107	 	 	$	41,145	 
	7/27/10
	 	$	15,825	 	 	 	—	 	 	$	41,145	 	 	$	722	 	 	$	56,970	 
	9/28/10
	 	$	6,330	 	 	 	—	 	 	$	56,960	 	 	$	125	 	 	$	63,300	 
	11/15/10
	 	$	4,249	 	 	 	—	 	 	$	63,300	 	 	 	—	 	 	$	67,549Exhibit 10.1

Exhibit 10.1

AMENDMENT NO. 7 TO

EMPLOYMENT AGREEMENT

This is an amendment, dated as of November 10, 2010 (the “Amendment”) to the Employment
Agreement made as of the 1st day of March, 2000 (the “Employment Agreement”), by and
between SELECT MEDICAL CORPORATION, a Delaware corporation (the “Employer”), and ROCCO A. ORTENZIO,
an individual (the “Employee”).

Background

Employer and Employee executed and delivered the Employment Agreement, that certain Amendment
No. 1 to the Employment Agreement, dated as of August 8, 2000, that certain Amendment No. 2 to the
Employment Agreement, dated as of February 23, 2001, that certain Amendment No. 3 to the Employment
Agreement, dated as of April 24, 2001, that certain Amendment No. 4 to the Employment Agreement,
dated as of September 17, 2001, that certain Amendment No. 5 to the Employment Agreement, dated as
of February 24, 2005 and that certain Amendment No. 6 to the Employment Agreement, dated as of
December 18, 2008. Employer and Employee now desire to amend the Employment Agreement as provided
herein.

Agreement

1. The last sentence of Section 3.01 of the Employment Agreement is hereby amended and restated in
its entirety to read as follows:

“The Employee will also be eligible to receive bonus compensation, annual or
otherwise, in an amount to be determined by the Employer’s Board of Directors in
its sole discretion, with any such bonus compensation to be paid to the Employee
by no later than March 15th of the year following the year to which
such bonus relates.”

2. Section 5.01 of the Employment Agreement is hereby amended and restated in its entirety to read
as follows:

“5.01. Change of Control Termination. If, during the Term, (1) there
should be a Change of Control (as defined in Section 5.02), and within the
one-year period immediately following the Change of Control the Employee’s
employment with the Employer (i) is terminated by the Employer without cause as
defined in Section 2.02(b), or (ii) is terminated by the Employee for any reason
or (2) (i) the Employee’s employment is terminated by the Employer other than for
cause, (ii) within the six-month period following such termination, a Change of
Control occurs and (iii) the Employee reasonably demonstrates that such
termination of employment was at the request of a third party who has taken steps
reasonably calculated to effect the Change of Control, then in lieu of the
payments described in Section 2.02(e)(iv) hereof, the Employer shall pay to the
Employee an amount equal to the Employee’s total cash compensation for base salary
and bonus for the immediately preceding three completed calendar years (or equal
to three times his average total annual cash compensation for base salary and
bonus for his years of service to the Employer, if less than three years), with
such amount to be paid in equal installments on each of the Employer’s regular
payroll dates over the remainder of the Term; provided, however, that the
commencement of

 

 

 

such payments shall be delayed until the first payroll date of the seventh month
following such termination; provided further, that, the first payment made
hereunder shall include the payments that otherwise would be made had the delay
described in the preceding clause not been imposed. For the avoidance of doubt, a
termination pursuant to Section 5.01(1)(ii) shall be treated as a termination for
good reason (as defined in Section 2.02(c)) and shall entitle the Employee to the
payments and benefits set forth in Section 2.02(e), as modified by this Section
5.01.”

3. Section 7.02 of the Employment Agreement is hereby amended and restated in its entirety to read
as follows:

“7.02. Release. As a condition to payment of any amount required under
Section 2.02(e) or Section 5.01 hereof, the Employee shall deliver to the Employer
a general release of liability of the Employer and its officers and directors in a
form reasonably satisfactory to the Employer, such that such release is effective,
with all revocation periods having expired unexercised, by no later than the
60th day after such termination.”

4. The last sentence of Section 7.10 of the Employment Agreement is hereby deleted and replaced
with the following:

“In addition, no reimbursement or in-kind benefit shall be subject to liquidation
or exchange for another benefit and the amount available for reimbursement, or
in-kind benefits provided, during any calendar year shall not affect the amount
available for reimbursement, or in-kind benefits to be provided, in a subsequent
calendar year. Any reimbursement to which Employee is entitled hereunder shall be
made no later than the last day of the calendar year following the calendar year
in which such expenses were incurred. This Agreement is intended to comply with
Code Section 409A (to the extent applicable) and the parties hereto agree to
interpret, apply and administer this Agreement in the least restrictive manner
necessary to comply therewith and without resulting in any increase in the amounts
owed hereunder by the Employer.”

5. Except as amended hereby, the Employment Agreement shall continue in effect in accordance with
its terms.

Please indicate your acceptance of the above Amendment by signing below in the space indicated.

Very truly yours,

SELECT MEDICAL CORPORATION, a

Delaware Corporation

	 	 	 	 	 	 	 
	By:

	 	/s/ Michael E. Tarvin
	 	 	 	/s/ Rocco A. Ortenzio
	 

	 	 
	 	 	 	 
	 

	 	Michael E. Tarvin,
	 	 	 	Rocco A. Ortenzio
	 

	 	Executive Vice President

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