On September 14, 2022, VBI Vaccines Inc. entered into an amendment (the “Second Amendment”) to the Loan Agreement, by and among the Company, Borrower Representative, the Guarantors, the Lenders and Administrative Agent. The parties to the Second Amendment have agreed to, among other things, (i) increase the amount of the term loans available under the Loan Agreement to $100,000,000 from $50,000,000, which term loans shall be available in up to four tranches subject to the achievement of milestones and other customary conditions, (ii) extend the availability periods during which the Company may draw each tranche of the term loans, subject to certain conditions, (iii) add certain minimum net revenue covenants to the Loan Agreement, (iv) extend the final maturity date for the term loans to September 14, 2026, which may be extended to September 14, 2027, under certain circumstances, and (v) to the extent that the maturity date is extended, the term loans will begin amortizing on a monthly basis on September 14, 2026. Following the submission of a Loan Request by the Borrowers on September 14, 2022, the Lenders are expected to advance the first tranche of term loans in an aggregate amount of $50 million to the Borrowers on or about September 15, 2022, which includes the refinancing of the $30 million in term loans currently outstanding under the Loan Agreement.

The second tranche of term loans of up to $15,000,000 will be available from April 1, 2023, through June 30, 2023, subject to the achievement of certain clinical milestones and compliance with a liquidity requirement which requires the Company to have sufficient cash on hand to funds its operations for at least nine months (the “Liquidity Requirement”). The third tranche of term loans of up to $10,000,000 will be available from April 1, 2024, through June 30, 2024, so long as each of the milestones for the second tranche of term loans were achieved, no events of default under the Loan Agreement have occurred and are continuing and the Liquidity Requirement is satisfied. The fourth tranche of term loans of up to $25,000,000 shall be available at any time from September 14, 2022, until September 14, 2026, subject to the Lender's review of the Company's clinical and financial plans and Lender's investment committee approval.

A portion of the term loans equal to $7,000,000 shall be convertible into shares of the Company's common stock at the Lender's option. $2,000,000 of the term loans shall be convertible into 1,369,863 shares of common stock at a conversion price of $1.46 and $5,000,000 of the term loans shall be convertible into 4,792,026 shares of common stock at a conversion price of $1.0434.