Exhibit 10.1

LICENSE AGREEMENT

This License Agreement (the “Agreement”), effective as of October 23, 2006 (the “Effective Date”), is entered into by and between Vical, Inc., a Delaware corporation having offices at 863A Mitten Road, Burlingame, California 94010 (“Valentis”) and Vical Incorporated, a Delaware corporation having offices at 10309 Pacific Center Court (“Vical”).  All references to Valentis and Vical in this Agreement shall include their Affiliates (as defined below).

BACKGROUND

A.            Valentis is the owner or exclusive licensee of certain Patent Rights and Know-How (as such terms are defined below), and Vical wishes to acquire a license under the Patent Rights and Know-How; and

B.            Valentis is willing to grant Vical such a license, on the terms and conditions set forth below.

NOW, THEREFORE, in consideration of the promises and the mutual covenants hereinafter recited, the parties agree as follows:

ARTICLE 1.

DEFINITIONS

In this Agreement, the following terms shall have the meanings set forth in this Article.

1.1           “ Affiliate ” means any company, corporation, division or other entity which is directly or indirectly controlling, controlled by or under common control with a party hereto.  For the purpose of this Agreement, with respect to any company, corporation, division or other entity, “control” shall mean the direct or indirect ownership of at least fifty percent (50%) of the outstanding shares or other voting rights of the subject company, corporation or other entity to elect directors.

1.2           “ Confidential Information ” means (a) any proprietary or confidential information or material in tangible form disclosed hereunder that is marked as “Confidential” at the time it is delivered to the receiving party, or (b) proprietary or confidential information disclosed orally hereunder which is identified as confidential or proprietary when disclosed and such disclosure of confidential information is confirmed in writing within thirty (30) days by the disclosing party.

1.3           “ Know-How ” means unpatented and/or unpatentable technical information, including ideas, concepts, inventions, discoveries, data, designs, formulas, specifications, procedures for experiments and tests and other protocols, results of experimentation and testing, fermentation and purification techniques, and assay protocols owned by Valentis as of the Effective Date and Vical after the Effective Date which may be necessary for the practice of the Valentis Patent Rights solely as contemplated hereunder.  Know-How shall not include the Valentis Patent Rights.  All Know-How shall be Confidential Information of Valentis.

1.4           “ Vical Products ” means any product or material resulting from Vical’s use of the Licensed Technology.

1.5           “ Licensed Technology ” means the Patent Rights and the Know-How.

1.6           “ Patent Rights ” means the patent applications and patents expressly listed in Exhibit A (“Patents”).

1.7           “ Third Party ” means any person or entity other than Vical or Valentis.

ARTICLE 2.

LICENSE

2.1           Grant to Vical .  Subject to the terms and conditions of this Agreement, Valentis hereby grants to Vical for the sum of one hundred eighty five thousand dollars ($185,000.00) payable in good US funds upon the Effective Date, a non-exclusive, worldwide, royalty-free, fully paid up license under the Licensed Technology, without the right to grant sublicenses except to either (i) a contract manufacturing organization (CMO) for the direct manufacture of Vical Products or (ii) in connection with a written bona-fide research, development and collaboration agreement with a Third Party, to:

(a)           make, have made, use (by a contract manufacturing organization solely for the direct manufacturing of Vical Products), export and import Vical Products;

2.2           No Implied Rights .  Only the licenses granted pursuant to the express terms of this Agreement shall be of any legal force or effect.  No other license rights shall be granted or created by implication, estoppel or otherwise.  For the avoidance of doubt, by example only and without expanding or narrowing the license grants of Sections 2.1, the grants of rights made pursuant to Sections 2.1 do not include, and expressly exclude, any right or license (a) to engage in any activities on behalf of or in collaboration with any Third Party (other than, in the case of Vical, as applicable), or (b) to release or waive any claim of infringement under any patent or patent application owned or controlled by Valentis or its Affiliates, including, without limitation, the Patent Rights.

2.3           Ownership; Enforcement; No Challenge .

(a)           Valentis owns the Licensed Technology, including all embodiments of the Patent Rights or the Know-How, and may freely use and commercialize such Licensed Technology itself or with Third Parties.  Valentis retains the right, at its sole discretion, to enforce, maintain and otherwise protect the Licensed Technology.  Vical shall give Valentis notice of any infringement by a Third Party of any patent or patent application owned or controlled by Valentis or misappropriation of the Know-How which comes to Vical’s knowledge during the term of this Agreement.  Vical will cooperate on a commercially reasonable basis with Valentis with respect to any actions Valentis may choose to take pursuant to this Section 2.4, and Valentis will reimburse Vical for its reasonable costs in this regard.

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(b)           Except as required under applicable law, Vical shall not participate, directly or indirectly, in any opposition or challenge to the validity or enforceability of any Patent in any forum and Vical shall not assist any Third Party in any such participation.  Any breach by Vical of this Section 2.5(b) shall constitute a material breach of this Agreement and any licenses or rights granted hereunder may, at Valentis’ option, be terminable.

2.4           Reports, Records and Audits .

(a)           Vical shall maintain records fully and properly reflecting those activities to be reported to Valentis pursuant to Section 2.6(a) (the “Records”) in sufficient detail and in good scientific manner appropriate for patent, regulatory and manufacturing purposes for at least three (3) years after the date of delivery of the report containing such information.  Upon the written request of Valentis and not more than once in each calendar year, Vical shall permit an independent third party, selected by Valentis and reasonably acceptable to Vical, at Valentis’ expense, to have access during normal business hours to such of the Records of Vical as may be reasonably necessary to verify compliance with the terms of this Agreement, as well as the accuracy of the reports hereunder.  Vical shall certify any statements by Vical personnel as to their accuracy and correctness.

ARTICLE 3.

IMPROVEMENTS

Valentis shall be free to research, develop and patent any improvements to the Licensed Technology and, except as expressly set forth herein, no rights shall be or are to be construed as granted under this Agreement to Vical to any patents or patent applications arising from such activities.

ARTICLE 4.

REPORTS AND RECORDS

4.1           Reports .  Vical shall make a written report to Valentis within thirty (30) days after each anniversary of the Effective Date describing Vical’ activities under the rights granted to Vical pursuant to Section 2.1.  Each such report shall also contain a written certification that Vical is in material compliance with all relevant terms and conditions of this Agreement.  Valentis shall treat all such reports as Confidential Information of Vical.

ARTICLE 5.

CONFIDENTIALITY

5.1           Confidential Information .  Except as expressly provided herein, the parties agree that, for the term of this Agreement and for five (5) years thereafter, the receiving party shall keep confidential and shall not publish or otherwise disclose, and shall not use for any purpose except for the purposes contemplated by this Agreement, any Confidential Information

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furnished to such receiving party by a disclosing party hereto, except to the extent that it can be established by the receiving party by written proof that such Confidential Information:

(a)           was already known to the receiving party, other than under an obligation of confidentiality to the disclosing party, at the time of disclosure;

(b)           was generally available to the public or otherwise part of the public domain at the time of its disclosure to the receiving party;

(c)           became generally available to the public or otherwise part of the public domain after its disclosure other than through any act or omission of the receiving party in breach of this Agreement; or

(d)           was subsequently disclosed to the receiving party by a person or entity with no obligation to the disclosing party with respect to such information.

5.2           Permitted Use and Disclosures .  Each party hereto may use or disclose information disclosed to it by the other party to the extent such use or disclosure is reasonably necessary for the purposes contemplated by this Agreement, and in such case pursuant to a confidentiality agreement no less restrictive than the terms set forth in this Article 6, or in complying with applicable law or government regulations; provided, however , that if a party is required to make any such disclosure of the other party’s Confidential Information, other than pursuant to such a confidentiality agreement, it will give reasonable advance notice to such other party of such disclosure.

5.3           Confidential Terms .  Except as expressly provided herein, each party agrees that the terms of this Agreement and the transaction and relationship with Valentis constitute Confidential Information and are not to be disclosed to any Third Party without the consent of the other party; provided that disclosures may be made as required by securities or other applicable laws, or to a party’s accountants, attorneys and other professional advisors provided, however, that the party required to make any such disclosure will give reasonable advance notice to such other party of such disclosure.

5.4           Existence of Agreement .  The parties hereby agree that the consummation of this Agreement, but not any of the terms hereof, except as otherwise permitted pursuant to Section 5.3, shall be deemed to be in the public domain and may be announced or otherwise referred to by a party as deemed appropriate.

ARTICLE 6.

REPRESENTATIONS AND WARRANTIES

6.1           Representations and Warranties .

(a)           Valentis represents and warrants that:  (i) it is the sole and exclusive owner or exclusive licensee of all right, title and interest in the Licensed Technology; (ii) it has the legal right, authority and power to enter into this Agreement, and to grant the licenses granted herein; (iii) this Agreement shall constitute a valid and binding obligation of

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Valentis enforceable in accordance with its terms; and (iv) the performance of its obligations under this Agreement by Valentis shall not result in a breach of any agreement, contract or other arrangement to which it is a party.

(b)           Vical represents and warrants that: (i) it has the legal right, authority and power to enter into this Agreement; (ii) this Agreement shall constitute a valid and binding obligation of Vical enforceable in accordance with its terms; and (iii) the performance of its obligations under this Agreement by Vical shall not result in a breach of any agreement, contract or other arrangement to which it is a party.

6.2           Disclaimer .  Nothing in this Agreement is or shall be construed as:

(a)           A warranty or representation by Valentis as to the validity or scope of any claim or patent within the Patent Rights;

(b)           A warranty or representation by Valentis that anything made, used, sold, or otherwise disposed of under any license granted in this Agreement is or will be free from infringement of any patent rights or other intellectual property right of any Third Party;

(c)           An obligation to b