<SEC-DOCUMENT>0001193125-13-390435.txt : 20131004
<SEC-HEADER>0001193125-13-390435.hdr.sgml : 20131004
<ACCEPTANCE-DATETIME>20131003182207
ACCESSION NUMBER:		0001193125-13-390435
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		8
CONFORMED PERIOD OF REPORT:	20131001
ITEM INFORMATION:		Other Events
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20131004
DATE AS OF CHANGE:		20131003

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			STEMCELLS INC
		CENTRAL INDEX KEY:			0000883975
		STANDARD INDUSTRIAL CLASSIFICATION:	BIOLOGICAL PRODUCTS (NO DIAGNOSTIC SUBSTANCES) [2836]
		IRS NUMBER:				943078125
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-19871
		FILM NUMBER:		131134994

	BUSINESS ADDRESS:	
		STREET 1:		3155 PORTER DRIVE
		STREET 2:		.
		CITY:			PALO ALTO
		STATE:			CA
		ZIP:			94304
		BUSINESS PHONE:		6504753100

	MAIL ADDRESS:	
		STREET 1:		3155 PORTER DRIVE
		STREET 2:		.
		CITY:			PALO ALTO
		STATE:			CA
		ZIP:			94304

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	CYTOTHERAPEUTICS INC/DE
		DATE OF NAME CHANGE:	19930328
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>d608543d8k.htm
<DESCRIPTION>FORM 8-K
<TEXT>
<HTML><HEAD>
<TITLE>Form 8-K</TITLE>
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 <P STYLE="line-height:1.0pt;margin-top:0pt;margin-bottom:0pt;border-bottom:1px solid #000000">&nbsp;</P>
<P STYLE="line-height:3.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1px solid #000000">&nbsp;</P> <P STYLE="margin-top:4pt; margin-bottom:0pt; font-size:18pt; font-family:Times New Roman" ALIGN="center"><B>UNITED STATES </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:18pt; font-family:Times New Roman" ALIGN="center"><B>SECURITIES AND EXCHANGE COMMISSION </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>WASHINGTON, D.C. 20549 </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center>
<P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:18pt; font-family:Times New Roman" ALIGN="center"><B>FORM 8-K
</B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center> <P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>CURRENT REPORT </B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>Pursuant
to Section&nbsp;13 or 15(d) </B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>of the Securities Exchange Act of 1934 </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:12pt; font-family:Times New Roman" ALIGN="center"><B>Date of Report (Date of Earliest Event Reported): October&nbsp;1, 2013 </B></P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center> <P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:24pt; font-family:Times New Roman" ALIGN="center"><B>StemCells, Inc. </B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>(Exact
name of registrant as specified in its charter) </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center>
<P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD VALIGN="top" ALIGN="center"><B>Delaware</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top" ALIGN="center"><B>000-19871</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top" ALIGN="center"><B>94-3078125</B></TD></TR>
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<TD VALIGN="top" ALIGN="center"><B>(State or other jurisdiction<BR>of incorporation)</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top" ALIGN="center"><B>(Commission<BR>File Number)</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top" ALIGN="center"><B>(I.R.S. Employer<BR>Identification No.)</B></TD></TR></TABLE> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="100%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" ALIGN="center">


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<TD VALIGN="top" ALIGN="center"><B>7707 Gateway Blvd, Suite 140, Newark, CA</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top" ALIGN="center"><B>94560</B></TD></TR>
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<TD VALIGN="top" ALIGN="center"><B>(Address of principal executive offices)</B></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top" ALIGN="center"><B>(Zip Code)</B></TD></TR>
</TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>Registrant&#146;s telephone number, including area code: 510.456.4000 </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>Not Applicable </B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>Former
name or former address, if changed since last report </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center>
<P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:21%">&nbsp;</P></center> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Check the appropriate box below
if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="FONT-FAMILY:WINGDINGS">&#168;</FONT></TD>
<TD ALIGN="left" VALIGN="top">Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="FONT-FAMILY:WINGDINGS">&#168;</FONT></TD>
<TD ALIGN="left" VALIGN="top">Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="FONT-FAMILY:WINGDINGS">&#168;</FONT></TD>
<TD ALIGN="left" VALIGN="top">Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) </TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="FONT-FAMILY:WINGDINGS">&#168;</FONT></TD>
<TD ALIGN="left" VALIGN="top">Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) </TD></TR></TABLE> <P STYLE="font-size:10pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<P STYLE="line-height:1.0pt;margin-top:0pt;margin-bottom:0pt;border-bottom:1px solid #000000">&nbsp;</P> <P STYLE="line-height:3.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1px solid #000000">&nbsp;</P>

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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Item&nbsp;8.01. Other Events. </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">On October 2, 2013, StemCells, Inc. (the &#147;Company&#148;) entered into an underwriting agreement (the &#147;Underwriting Agreement&#148;)
with Chardan Capital Markets, LLC, as representative of the underwriters named in Schedule I (the &#147;Underwriters&#148;), pursuant to which the Company agreed to sell to the Underwriters 11,170,000 shares of common stock of the Company and
warrants to purchase up to 5,585,000 shares of common stock. The common stock and warrants will be sold in units (each a &#147;Unit&#148;, and collectively, the &#147;Units&#148;), with each Unit consisting of one share of common stock and half a
warrant (the &#147;Warrants&#148;). Each Warrant entitles the holder to purchase a share of common stock at an exercise price of $1.80 per share of common stock. Each Unit will be sold at a public offering price of $1.45 per Unit in an underwritten
public offering (the &#147;Offering&#148;). The Company has also granted the Underwriters a 30 day option to purchase up to an additional 1,675,500 shares of common stock and Warrants to purchase up to an additional 837,750 shares of common stock to
cover over allotments, if any. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The Company expects that the gross proceeds of the Offering will be approximately $16.2 million. The
shares of common stock issued as part of the Units (the &#147;Shares&#148;), the Warrants and the shares of common stock underlying the Warrants are being issued pursuant to the effective registration statement of Form S-3 (Registration
No.&nbsp;333-170300). </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The Offering is expected to close on or about October&nbsp;7, 2013, subject to the satisfaction of customary
closing conditions. In connection with the Offering, the Company terminated its equity purchase agreement with Lincoln Park Capital Fund, LLC. Lincoln Park is participating in the Offering as an investor. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">On October&nbsp;1, 2013, the Company issued a press release announcing that it intended to make a public offering of securities. On
October&nbsp;2, 2013, the Company issued a press release announcing the pricing and terms of the Offering. Copies of the two press releases are attached hereto as Exhibits 99.1 and 99.2, respectively, and are each incorporated herein by reference.
Ropes&nbsp;&amp; Gray LLP, counsel to the Company, has issued an opinion to the Company, dated October&nbsp;2, 2013, regarding the Shares and Warrants to be sold in the Offering. A copy of the opinion is filed as Exhibit 5.1 to this Current Report
on Form 8-K. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">On October 2, 2013, the Company issued a press release announcing FDA authorization of the IND to begin clinical testing of
the Company&#146;s proprietary HuCNS-SC human neural stem cells as a treatment for spinal cord injury. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Item&nbsp;9.01. Financial Statements and
Exhibits. </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">(d)&nbsp;Exhibits </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD VALIGN="bottom" NOWRAP ALIGN="center"> <P STYLE="border-bottom:1.00pt solid #000000; width:25.30pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>Exhibit<BR>No.</B></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom" NOWRAP ALIGN="center"> <P STYLE="border-bottom:1.00pt solid #000000; width:39.50pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>Description</B></P></TD></TR>


<TR>
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" NOWRAP>&nbsp;&nbsp;1.1</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">Underwriting Agreement between StemCells, Inc. and Chardan Capital Markets, LLC</TD></TR>
<TR>
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" NOWRAP>&nbsp;&nbsp;4.1</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">Form of Warrant</TD></TR>
<TR>
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" NOWRAP>&nbsp;&nbsp;5.1</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">Opinion of Ropes &amp; Gray LLP</TD></TR>
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<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
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<TD VALIGN="top" NOWRAP>23.1</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">Consent of Ropes &amp; Gray LLP (contained in Exhibit 5.1 above)</TD></TR>
<TR>
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" NOWRAP>99.1</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">Press Release of StemCells, Inc. dated October 1, 2013</TD></TR>
<TR>
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" NOWRAP>99.2</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">Press Release of StemCells, Inc. dated October 2, 2013</TD></TR>
<TR>
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" NOWRAP>99.3</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">Press Release of StemCells, Inc. dated October 2, 2013</TD></TR>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>SIGNATURES </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned
hereunto duly authorized. </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD VALIGN="top">October&nbsp;3, 2013</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top" COLSPAN="3">StemCells, Inc.</TD></TR>
<TR>
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="4"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top" COLSPAN="3"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">/s/ Ken Stratton</P></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">Name:</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">Ken Stratton</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">Title:</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">General Counsel</TD></TR>
</TABLE>

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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>Exhibit Index </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD VALIGN="bottom" NOWRAP ALIGN="center"> <P STYLE="border-bottom:1.00pt solid #000000; width:25.30pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>Exhibit<BR>No.</B></P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom" NOWRAP ALIGN="center"> <P STYLE="border-bottom:1.00pt solid #000000; width:39.50pt; font-size:8pt; font-family:Times New Roman" ALIGN="center"><B>Description</B></P></TD></TR>


<TR>
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" NOWRAP>&nbsp;&nbsp;1.1</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">Underwriting Agreement between StemCells, Inc. and Chardan Capital Markets, LLC</TD></TR>
<TR>
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" NOWRAP>&nbsp;&nbsp;4.1</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">Form of Warrant</TD></TR>
<TR>
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" NOWRAP>&nbsp;&nbsp;5.1</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">Opinion of Ropes &amp; Gray LLP</TD></TR>
<TR>
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" NOWRAP>23.1</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">Consent of Ropes &amp; Gray LLP (contained in Exhibit 5.1 above)</TD></TR>
<TR>
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" NOWRAP>99.1</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">Press Release of StemCells, Inc. dated October 1, 2013</TD></TR>
<TR>
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" NOWRAP>99.2</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">Press Release of StemCells, Inc. dated October 2, 2013</TD></TR>
<TR>
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" NOWRAP>99.3</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">Press Release of StemCells, Inc. dated October 2, 2013</TD></TR>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="right"><B>Exhibit 1.1 </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="right"><B><I>EXECUTION VERSION </I></B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>11,170,000 Shares of Common Stock </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>Warrants to Purchase 5,585,000 Shares of Common Stock </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>And </B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>1,675,500
Over-Allotment Shares </B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>Over-Allotment Warrants to Purchase 837,750 Shares of Common Stock </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>STEMCELLS, INC. </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>UNDERWRITING AGREEMENT </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="right">October&nbsp;2, 2013 </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Chardan Capital Markets,
LLC </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">As the Representative of the </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Several
underwriters, if any, named in <U>Schedule I</U> hereto </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">17 State Street </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Suite 1600 </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">New York, NY 10004 </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Ladies and Gentlemen: </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The undersigned,
StemCells, Inc., a company formed under the laws of the State of Delaware (collectively with its subsidiaries and affiliates, including, without limitation, all entities disclosed or described in the Registration Statement as being subsidiaries or
affiliates of StemCells, Inc., the &#147;<U>Company</U>&#148;), hereby confirms its agreement (this &#147;<U>Agreement</U>&#148;) with the underwriters (such underwriters, including as the Representative (as defined below), the
&#147;<U>Underwriters</U>&#148; and each an &#147;<U>Underwriter</U>&#148;) named in <U>Schedule I</U> hereto for whom Chardan Capital Markets, LLC is acting as representative (the &#147;<U>Representative</U>,&#148; and if there are no Underwriters
other than the Representative, references to multiple Underwriters shall be disregarded and the term Representative as used herein shall have the same meaning as Underwriter) on the terms and conditions set forth herein. </P>

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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">It is understood that the several Underwriters are to make a public offering of the Public
Securities as soon as the Representative deems it advisable to do so. The Company has granted the Underwriters the option to purchase an aggregate of up to an additional 1,675,500 shares of Common Stock and warrants to purchase up to an aggregate of
837,750 shares of Common Stock as may be necessary to cover over-allotments made in connection with the offering, as set forth in Section&nbsp;2.4 of this Agreement. The Closing Shares, Warrants, Warrant Shares and Option Shares are collectively
referred to as the &#147;<U>Securities</U>.&#148; The Public Securities are to be offered to the public at the public offering price set forth in the Prospectus. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">It is further understood that you will act as the Representative for the Underwriters in the offering and sale of the Securities in accordance
with this Agreement. </P> <P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>ARTICLE I. </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>DEFINITIONS </B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">1.1
<U>Definitions</U>. In addition to the terms defined elsewhere in this Agreement, for all purposes of this Agreement, the following terms have the meanings set forth in this Section&nbsp;1.1: </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">&#147;<U>Affiliate</U>&#148; means with respect to any Person, any other Person that, directly or indirectly through one or more
intermediaries, controls or is controlled by or is under common control with such Person as such terms are used in and construed under Rule 405 under the Securities Act. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Applicable Time</U>&#148; means 8:30 a.m., Eastern Time on October&nbsp;2, 2013. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Board of Directors</U>&#148; means the board of directors of the Company. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Business Day</U>&#148; means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the
United States or any day on which banking institutions in the State of New York are closed. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Closing</U>&#148;
means the closing of the purchase and sale of the Closing Shares pursuant to Section&nbsp;2.1. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Closing
Date</U>&#148; means 10:00 a.m. Eastern time on October&nbsp;7, 2013, or at such other time as shall be agreed upon by the Representative and the Company. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Closing Purchase Price</U>&#148; shall have the meaning ascribed to such term in Section&nbsp;2.1(b), which aggregate
purchase price shall be net of discounts and commissions. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Closing Shares</U>&#148; shall have the meaning
ascribed to such term in Section&nbsp;2.1(a)(i). </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">2 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Closing Warrants</U>&#148; shall have the meaning ascribed to such term
in Section&nbsp;2.1(a)(ii). </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Commission</U>&#148; means the United States Securities and Exchange Commission. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Common Stock</U>&#148; means the common stock of the Company, par value $.01 per share, and any other class of
securities into which such securities may hereafter be reclassified or changed. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Common Stock
Equivalents</U>&#148; means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire at any time Common Stock, including, without limitation, any debt, preferred stock, right, option, warrant or other
instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Stock. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Company Auditor</U>&#148; means Grant Thornton, LLP, with offices located at 150 Almaden Boulevard, Suite 600, San
Jose, California 95113. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Company Counsel</U>&#148; means Ropes&nbsp;&amp; Gray LLP, with offices located at
Prudential Tower, 800 Boylston Street, Boston, MA 02199. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Contributing Party</U>&#148; shall have the meaning
ascribed to such term in Section&nbsp;5.4(b). </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Effective Date</U>&#148; shall have the meaning ascribed to such
term in Section&nbsp;3.1(f). </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Exchange Act</U>&#148; means the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated thereunder. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Execution Date</U>&#148; shall mean the date the parties
execute and enter into this Agreement. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Exempt Issuance</U>&#148; means the issuance of (a)&nbsp;shares of Common
Stock or options to employees, officers or directors of the Company pursuant to any stock or option plan duly adopted for such purpose, by a majority of the non-employee members of the Board of Directors or a majority of the members of a committee
of non-employee directors established for such purpose, (b)&nbsp;securities upon the exercise or exchange of or conversion of any Securities issued hereunder and/or other securities exercisable or exchangeable for or convertible into shares of
Common Stock issued and outstanding on the date of this Agreement, provided that such securities have not been amended since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange price or
conversion price of such securities and (c)&nbsp;securities issued pursuant to acquisitions or strategic transactions approved by a majority of the disinterested directors of the Company, provided that any such issuance shall only be to a
</P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">3 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">
Person (or to the equity holders of a Person) which is, itself or through its subsidiaries, an operating company or an owner of an asset in a business synergistic with the business of the Company
and shall provide to the Company additional benefits in addition to the investment of funds, but shall not include a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an entity whose primary
business is investing in securities. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>FINRA</U>&#148; means the Financial Industry Regulatory Authority. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>GAAP</U>&#148; shall have the meaning ascribed to such term in Section&nbsp;3.1(h). </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Intellectual Property</U>&#148; shall have the meaning ascribed to such term in Section&nbsp;3.1(o). </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Liens</U>&#148; means a lien, charge, pledge, security interest, encumbrance, right of first refusal, preemptive right
or other restriction. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Lock-Up Agreements</U>&#148; shall mean the lock-up agreements, in the form of <U>Exhibit
A</U> attached hereto, delivered at the Closing by each of the Company&#146;s officers and directors holding Common Stock or Common Stock Equivalents. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Material Adverse Effect</U>&#148; means (i)&nbsp;a material adverse effect on the legality, validity or enforceability
of any Transaction Document, (ii)&nbsp;a material adverse effect on the results of operations, assets, business, prospects or condition (financial or otherwise) of the Company and the Subsidiaries, taken as a whole or (iii)&nbsp;a material adverse
effect on the Company&#146;s ability to perform in any material respect on a timely basis its obligations under any Transaction Document, but shall not mean or include any condition, event or change which (1)&nbsp;is or results from events or
occurrences relating to the economy in general (including arising from terrorist attacks, acts of war or civil unrest) or the Company&#146;s industry in general and not specifically relating to the Company or having a disproportionate impact on the
Company, or (2)&nbsp;results from the announcement of this Agreement or the transactions contemplated hereby or by the other Transaction Documents. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Offering</U>&#148; shall have the meaning ascribed to such term in Section&nbsp;2.1(c). </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Option Closing Date</U>&#148; shall have the meaning ascribed to such term in Section&nbsp;2.4(a). </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Option Notice</U>&#148; shall have the meaning ascribed to such term in Section&nbsp;2.4(a). </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Option Shares</U>&#148; shall have the meaning ascribed to such term in Section&nbsp;2.4(a). </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Option Securities</U>&#148; shall have the meaning ascribed to such term in Section&nbsp;2.4(a). </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">4 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Option Warrants</U>&#148; shall have the meaning ascribed to such term
in Section&nbsp;2.4(a). </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Per Share Purchase Price</U>&#148; shall have the meaning ascribed to such term in
Section&nbsp;2.1(b). </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Permits</U>&#148; shall have the meaning ascribed to such term in Section&nbsp;3.1(p). </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Person</U>&#148; means an individual or corporation, partnership, trust, incorporated or unincorporated association,
joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Preliminary Prospectus</U>&#148; means, if any, any preliminary prospectus relating to the Securities included in the
Registration Statement or filed with the Commission pursuant to Rule 424(b). </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Proceeding</U>&#148; means an
action, claim, suit, investigation or proceeding (including, without limitation, an investigation or partial proceeding, such as a deposition), whether commenced or threatened. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Prospectus</U>&#148; means the final prospectus filed for the Registration Statement with respect to the Securities.
</P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Prospectus Supplement</U>&#148; means, if any, any supplement to the Prospectus complying with Rule 424(b) of the
Securities Act that is filed with the Commission. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Public Securities</U>&#148; shall mean the Closing Shares and
Closing Warrants. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>PC</U>&#148; means Pryor Cashman LLP, with offices located at 7 Times Square, New York, New
York 10036. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Registration Statement</U>&#148; means, the registration statement of the Company on Form S-3 (File
No.&nbsp;333-170300) with respect to the Securities, as amended as of the date hereof, including the Prospectus and Prospectus Supplement, if any, the Preliminary Prospectus, if any, and all exhibits filed with or incorporated by reference into such
registration statement. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Required Approvals</U>&#148; shall have the meaning ascribed to such term in
Section&nbsp;3.1(e). </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Road Show Materials</U>&#148; shall have the meaning ascribed to such term in
Section&nbsp;6.1. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Rule 424</U>&#148; means Rule 424 promulgated by the Commission pursuant to the Securities Act,
as such Rule may be amended or interpreted from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">5 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>SEC Reports</U>&#148; shall have the meaning ascribed to such term in
Section&nbsp;3.1(h). </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Securities</U>&#148; means the Closing Shares, the Warrants, the Warrant Shares and the
Option Shares. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Securities Act</U>&#148; means the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Subsidiary</U>&#148; shall have the meaning ascribed to such term in
Section&nbsp;3.1(a). </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Trading Day</U>&#148; means a day on which the principal Trading Market is open for trading.
</P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Trading Market</U>&#148; means any of the following markets or exchanges on which the Common Stock is listed or
quoted for trading on the Closing Date: the NYSE AMEX, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock Exchange or the OTC Bulletin Board (or any successors to any of the foregoing). </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Transaction Documents</U>&#148; means this Agreement. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Transfer Agent</U>&#148; means the current transfer agent of the Company and any successor transfer agent of the
Company. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Underwriter Free Writing Prospectus</U>&#148; shall have the meaning ascribed to such term in
Section&nbsp;4.20(a). </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">&#147;<U>Warrants</U>&#148; means, collectively, the Closing Warrants and the Option Warrants. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">&#147;<U>Warrant Shares</U>&#148; means the shares of Common Stock issuable upon exercise of the Warrants. </P>
<P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>ARTICLE II. </B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>PURCHASE
AND SALE </B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">2.1 <U>Closing</U>. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(a) Upon the terms and subject to the conditions set forth herein, the Company agrees to sell in the aggregate 11,170,000
shares of Common Stock and warrants to purchase 5,585,000 shares of Common Stock, and each Underwriter agrees to purchase, severally and not jointly, at the Closing, the following combination of securities of the Company: </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(i) the number of shares of Common Stock (the &#147;<U>Closing Shares</U>&#148;) set forth opposite the name of such
Underwriter on <U>Schedule I</U> hereof; and </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">6 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(ii) Warrants to purchase up to a number of shares of Common Stock set forth
opposite the name of such Underwriter on <U>Schedule I</U> hereof, which warrants shall be exercisable immediately and have a term of exercise equal to five (5)&nbsp;years and an exercise price equal to $1.80 per share of Common Stock, subject to
adjustment as provided therein (the &#147;<U>Closing Warrants</U>&#148;). </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(b) The aggregate purchase price for the Public
Securities shall equal the amount set forth opposite the name of such Underwriter on <U>Schedule I</U> hereto (the &#147;<U>Closing Purchase Price</U>&#148;) or, for each unit consisting of one share of Common Stock and one Closing Warrant to
purchase .5 of a share of Common Stock, $1.363 (the &#147;<U>Per Unit Purchase Price</U>&#148;); and </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(c) On the Closing
Date, each Underwriter shall deliver, or cause to be delivered to the Company, via wire transfer, immediately available funds equal to such Underwriter&#146;s Closing Purchase Price and the Company shall deliver to, or as directed by, such
Underwriter its respective Public Securities and the Company shall deliver the other items required pursuant to Section&nbsp;2.2 deliverable at the Closing. Upon satisfaction of the covenants and conditions set forth in Sections&nbsp;2.2 and 2.3,
the Closing shall occur at the offices of PC or such other location as the Company and Representative shall mutually agree. The Public Securities are to be offered to the public at the offering price set forth on the cover page of the Prospectus
(the &#147;<U>Offering</U>&#148;). </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">2.2 <U>Deliveries</U>. At the Closing Date and Option Closing Date, as applicable, the Company shall
deliver or cause to be delivered to each Underwriter the following: </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(i) The Closing Shares or Option Shares, as
applicable, which shares shall be delivered via The Depository Trust Company Deposit or Withdrawal at Custodian system for the accounts of the several Underwriters; </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(ii) The Warrants, in certificated form registered in the name or names and in such authorized denominations as the applicable
Underwriter may request in writing at least two full Business Days prior to the Closing Date; </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(iii) A legal opinion of
Company Counsel addressed to the Underwriters, in form and substance reasonably satisfactory to the Representative; </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(iv) A
cold comfort letter, addressed to the Underwriters and in form and substance satisfactory in all respects to the Representative from the Company Auditor dated, respectively, as of the date of this Agreement and a bring-down letter dated as of the
Closing Date and Option Closing Date, as applicable; </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">7 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(v) The duly executed and delivered Officer&#146;s Certificate, substantially in
the form required by <U>Exhibit B</U> attached hereto; </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(vi) The duly executed and delivered Secretary&#146;s Certificate,
substantially in the form required by <U>Exhibit C</U> attached hereto; and </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(vi) The duly executed and delivered Lock-Up
Agreements. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">2.3 <U>Conditions Precedent</U>. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(a) <U>Closing Date</U>. The respective obligations of each Underwriter hereunder in connection with the Closing Date are subject to the
following conditions being met or waived by the Representative: </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(i) the accuracy in all material respects (other than
representations and warranties of the Company already qualified by materiality, which shall be true and correct in all respects) on the Closing Date, as applicable, of the representations and warranties of the Company contained herein (unless as of
a specific date therein); </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(ii) all obligations, covenants and agreements of the Company required to be performed at or
prior to the Closing Date, as applicable, shall have been performed; </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(iii) the delivery by the Company of the items set
forth in Section&nbsp;2.2 of this Agreement; </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(iv) the Registration Statement shall be effective on the date of this
Agreement and at the Closing Date no stop order suspending the effectiveness of the Registration Statement shall have been issued and no proceedings for that purpose shall have been instituted or to the Company&#146;s knowledge shall be pending or
contemplated by the Commission and any request on the part of the Commission for additional information shall have been complied with to the reasonable satisfaction of the Representative; </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(v) the Common Stock is still approved for listing on the Trading Market; and </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(vi) on the Closing Date: (i)&nbsp;there shall have been no material adverse change in the condition or prospects or the
business activities, financial or otherwise, of the Company from the latest dates as of which such condition is set forth in the Registration Statement and Prospectus; (ii)&nbsp;no action, suit or proceeding, at law or in equity, shall have been
pending or threatened against the Company or any Affiliate of the Company before or by any court or federal or state commission, board or other administrative agency wherein an unfavorable decision, ruling or finding may materially adversely affect
the business, operations, prospects or financial condition or income of the Company, except as set forth in the Registration Statement and Prospectus; (iii)&nbsp;no stop order shall </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">8 </P>


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have been issued under the Securities Act and no proceedings therefor shall have been initiated or threatened by the Commission; and (iv)&nbsp;at the Applicable Time, the Registration Statement
and the Prospectus and any amendments or supplements thereto shall contain all material statements which are required to be stated therein in accordance with the Securities Act and the rules and regulations thereunder and shall conform in all
material respects to the requirements of the Securities Act and the rules and regulations thereunder, and neither the Registration Statement nor the Prospectus nor any amendment or supplement thereto shall contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">(b) <U>Option Closing Date</U>. The respective obligations of the Underwriters hereunder in connection with the Option Closing Date are
subject to the following conditions being met or waived by the Representative: </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(i) the accuracy in all material respects
(other than representations and warranties of the Company already qualified by materiality, which shall be true and correct in all respects) on the Option Closing Date, as applicable, of the representations and warranties of the Company contained
herein (unless as of a specific date therein); </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(ii) all obligations, covenants and agreements of the Company required to
be performed at or prior to the Option Closing Date, as applicable, shall have been performed; </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(iii) the delivery by the
Company of the items set forth in Section&nbsp;2.2 of this Agreement, except for the Lockup Agreements required by Section&nbsp;2.2(vi), which are required to be delivered solely in connection with the Closing Date; </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(iv) the Registration Statement shall be effective on the date of this Agreement and at the Option Closing Date no stop order
suspending the effectiveness of the Registration Statement shall have been issued and no proceedings for that purpose shall have been instituted or to the Company&#146;s knowledge shall be pending or contemplated by the Commission and any request on
the part of the Commission for additional information shall have been complied with to the reasonable satisfaction of the Representative; </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">2.4 <U>Option</U>. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(a) <U>Exercise of Option</U>. The Company hereby grants to the Underwriters the option to purchase (i)&nbsp;not more than an
additional 1,675,500 shares of Common Stock (the &#147;<U>Option Shares</U>&#148;) and (ii)&nbsp;warrants to purchase up to an aggregate of 837,750 shares of Common Stock (the &#147;<U>Option Warrants</U>&#148;, and, collectively with the Option
Shares, the &#147;<U>Option Securities</U>&#148;), to be offered by the </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">9 </P>


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Company pursuant hereto, upon the basis of the warranties and representations and subject to the terms and conditions herein set forth. The Underwriters shall have the right to purchase all or
any portion of the Option Securities, in each case as units as described in Section&nbsp;2.1(b), at the Per Unit Purchase Price as may be necessary to cover over-allotments made in connection with the transactions contemplated hereby. If any Option
Securities are to be purchased, the number of Option Securities to be purchased by each Underwriter shall be the number of Option Securities which bears the same ratio to the aggregate number of Option Securities being purchased as the number of
Public Securities purchased by such Underwriter bears to the aggregate number of Public Securities purchased from the Company by the Underwriters, subject, however, to such adjustments to eliminate any fractional Shares as the Representative in its
sole discretion shall make. This option may be exercised by the Underwriters at any time on or before the thirtieth day following the date hereof, by written notice to the Company (the &#147;<U>Option Notice</U>&#148;). The Option Notice shall set
forth the aggregate number of Option Securities as to which the option is being exercised, and the date and time when the Option Securities are to be delivered (such date and time being herein referred to as the &#147;<U>Option Closing
Date</U>&#148;); <I>provided</I>, <I>however</I>, that the Option Closing Date shall not be earlier than the Closing Date (as defined below) nor earlier than the third business day after the date on which the option shall have been exercised nor
later than the fifth business day after the date on which the option shall have been exercised unless the Company and the Underwriters otherwise agree. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(b) <U>Payment and Delivery of Option Securities</U>. Payment of the purchase price for and delivery of the Option Securities
shall be made at the Option Closing Date in the same manner and at the same office as the payment for the Public Securities as set forth in Section&nbsp;2.1(c) above. </P>
<P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>ARTICLE III. </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>REPRESENTATIONS AND WARRANTIES </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">3.1 <U>Representations and Warranties of the Company</U>. Except as set forth in the Registration Statement, the Preliminary Prospectus or the
SEC Reports, the Company hereby makes the representations and warranties set forth below to the Underwriters as of the date hereof and as of the Closing Date: </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(a) <U>Subsidiaries</U>. All of the direct and indirect significant subsidiaries (as such term is defined in Rule 1-02(w) of
Regulation S-X) of the Company are listed in the Company&#146;s most recent Annual Report on Form 10-K as modified by any subsequent SEC Reports filed with the Commission (each a &#147;<U>Subsidiary</U>&#148;). The Company owns, directly or
indirectly, all of the capital stock or other equity interests of each Subsidiary free and clear of any Liens, and all the issued and outstanding shares of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable and
free of preemptive and similar rights to subscribe for or purchase securities. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">10 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(b) <U>Organization and Qualification</U>. Each of the Company and the
Subsidiaries is an entity duly incorporated or otherwise organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization (as applicable), except where the failure of a Subsidiary to be in good
standing could not reasonably be expected to result in a Material Adverse Effect. Each of the Company and the Subsidiaries has the requisite power and authority to own and use its properties and assets and to carry on its business as currently
conducted. Neither the Company nor any Subsidiary is in violation or default of any of the provisions of its respective certificate or articles of incorporation, bylaws or other organizational or charter documents. Each of the Company and the
Subsidiaries is duly qualified to conduct business and is in good standing as a foreign corporation or other entity in each jurisdiction in which the nature of the business conducted or property owned by it makes such qualification necessary, except
where the failure to be so qualified or in good standing, as the case may be, could not reasonably be expected to result in a Material Adverse Effect and, to the knowledge of the Company, no Proceeding has been instituted in any such jurisdiction
revoking, limiting or curtailing or seeking to revoke, limit or curtail such power and authority or qualification. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(c)
<U>Authorization; Enforcement</U>. The Company has the requisite corporate power and authority to enter into and to consummate the transactions contemplated by each of the Transaction Documents and otherwise to carry out its obligations thereunder.
The execution and delivery of each of the Transaction Documents by the Company and the consummation by it of the transactions contemplated thereby have been duly authorized by all necessary action on the part of the Company and its stockholders, and
no further action is required by the Company or its stockholders in connection therewith other than in connection with the Required Approvals (as defined below). Each Transaction Document has been (or upon delivery will have been) duly executed by
the Company and, when delivered in accordance with the terms hereof, will constitute the valid and binding obligation of the Company enforceable against the Company in accordance with its terms except (i)&nbsp;as limited by general equitable
principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors&#146; rights generally, (ii)&nbsp;as limited by laws relating to the availability of specific
performance, injunctive relief or other equitable remedies and (iii)&nbsp;insofar as indemnification and contribution provisions may be limited by applicable law. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(d) <U>No Conflicts</U>. The execution, delivery and performance of the Transaction Documents by the Company, the issuance and
sale of the Securities at the Closing and the consummation by the Company of the other transactions contemplated thereby do not and will not (i)&nbsp;conflict with or violate any provision of the Company&#146;s or any Subsidiary&#146;s certificate
or articles of incorporation, bylaws or other organizational or charter documents, or (ii)&nbsp;conflict with, violate or constitute a default (or an event that with notice or lapse of time or both would become a default) under, or result in the
creation of any Lien upon any of the properties or assets of the Company or any Subsidiary pursuant to, or give to </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">11 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">
others any rights of termination, amendment, acceleration or cancellation (with or without notice, lapse of time or both) of, any agreement (written or oral), credit facility, debt or other
instrument (evidencing a Company or Subsidiary debt or otherwise) to which the Company or any Subsidiary is a party or by which any property or asset of the Company or any Subsidiary is bound or affected, or (iii)&nbsp;subject to the Required
Approvals (as defined below), conflict with or result in a violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction of any court or governmental authority to which the Company or a Subsidiary is subject
(including federal and state securities laws and regulations), or by which any property or asset of the Company or a Subsidiary is bound or affected, except in the case of each of clauses (ii)&nbsp;and (iii), such as could not reasonably be expected
to result in a Material Adverse Effect. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(e) <U>Filings, Consents and Approvals</U>. The Company is not required to obtain
any consent, waiver, authorization, approval or order of, give any notice to, or make any filing or registration with, any court or other federal, state, local or other governmental authority having jurisdiction over the Company or its Subsidiaries,
its stockholders or the Trading Market in connection with the execution, delivery and performance by the Company of the Transaction Documents, including the issuance and listing or quotation (as applicable) of the Securities on the Trading Market,
other than (i)&nbsp;the filing of the Prospectus and (ii)&nbsp;any notice filings or SEC Reports as are required to be made in connection with the Closing Date under applicable federal and state securities laws or under applicable rules and
regulations of the Trading Market (collectively, the &#147;<U>Required Approvals</U>&#148;). </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(f) <U>Issuance of the
Securities</U>. The Securities are duly authorized and, when issued and paid for in accordance with the applicable Transaction Documents, will be duly and validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the
Company. The Warrant Shares, when issued in accordance with the terms of the Warrants, will be validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the Company. The Company has reserved from its duly authorized
capital stock the maximum number of shares of Common Stock issuable pursuant to this Agreement and the Warrants. The holder of the Securities will not be subject to personal liability by reason of being such holders. The Securities are not and will
not be subject to the preemptive rights of any holders of any security of the Company or similar contractual rights granted by the Company. All corporate action required to be taken for the authorization, issuance and sale of the Securities has been
duly and validly taken. The Company has prepared and filed the Registration Statement in conformity with the requirements of the Securities Act, which became effective on November&nbsp;16, 2010 (the &#147;<U>Effective Date</U>&#148;), including the
Prospectus, and such amendments and supplements thereto as may have been required to the date of this Agreement. The Registration Statement is effective under the Securities Act and no stop order preventing or suspending the effectiveness of the
Registration Statement or suspending or preventing the use of the Prospectus has been issued by the Commission and no proceedings for that purpose have been instituted or, to </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">12 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">
the knowledge of the Company, are threatened by the Commission. The Company, if required by the rules and regulations of the Commission, proposes to file the Prospectus with the Commission
pursuant to Rule 424(b). At the time the Registration Statement and any amendments thereto became effective, at the date of this Agreement and at the Closing Date, the Registration Statement and any amendments thereto conformed and will conform in
all material respects to the requirements of the Securities Act and did not and will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not
misleading; and the Prospectus and any amendments or supplements thereto, at time the Prospectus or any amendment or supplement thereto was issued and at the Closing Date, conformed and will conform in all material respects to the requirements of
the Securities Act and did not and will not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.
</P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(g) <U>Capitalization.</U> The capitalization of the Company is as set forth in the Registration Statement. No Person has
any right of first refusal, preemptive right, right of participation, or any similar right to participate in the transactions contemplated by the Transaction Documents. There are no outstanding options, warrants, rights to subscribe to, calls or
commitments of any character whatsoever relating to, or securities, rights or obligations convertible into or exchangeable for, or giving any Person any right to subscribe for or acquire, any shares of Common Stock, or contracts, commitments,
understandings or arrangements by which the Company or any Subsidiary is or may become bound to issue additional shares of Common Stock or Common Stock Equivalents. The issue and sale of the Securities will not obligate the Company to issue shares
of Common Stock or other securities to any Person (other than the Underwriters) and will not result in a right of any holder of Company securities to adjust the exercise, conversion, exchange or reset price under such securities. All of the
outstanding shares of capital stock of the Company are validly issued, fully paid and nonassessable, have been issued in compliance with all federal and state securities laws and requirements of the Trading Market, and none of such outstanding
shares was issued in violation of any preemptive rights or similar rights to subscribe for or purchase securities. The authorized shares of the Company conform in all material respects to all statements relating thereto contained in the Registration
Statement and the Prospectus. The offers and sales of the Company&#146;s securities were, at the time effected, either registered under the Securities Act and the applicable state securities or Blue Sky laws or, to the Company&#146;s knowledge based
in part on the representations and warranties of the purchasers, exempt from such registration requirements. No further approval or authorization of any stockholder or the Board of Directors of the Company is required for the issuance and sale of
the Securities, other than the Required Approvals. There are no stockholders agreements, voting agreements or other similar agreements with respect to the Company&#146;s capital stock to which the Company is a party or, to the knowledge of the
Company, between or among any of the Company&#146;s stockholders. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">13 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(h) <U>SEC Reports; Financial Statements</U>. The Company has filed or furnished
all reports, schedules, forms, statements and other documents required to be filed or furnished by it under the Securities Act and the Exchange Act (including all required exhibits thereto), including pursuant to Section&nbsp;13(a) or 15(d) thereof,
(the foregoing materials, as the same may be amended, and including the exhibits thereto and documents incorporated by reference therein, being collectively referred to herein as the &#147;<U>SEC Reports</U>&#148;) for the 12 months preceding the
date hereof (or such shorter period as the Company was required by law to file such material) and any notices, reports or other filings pursuant to applicable requirements of the Trading Market on a timely basis or has received a valid extension of
such time of filing, and has filed any such SEC Reports and notices, reports or other filings pursuant to applicable requirements of the Trading Market prior to the expiration of any such extension. As of their respective dates, the SEC Reports
complied in all material respects with the applicable requirements of the Securities Act and the Exchange Act and the rules and regulations of the Commission promulgated thereunder, and none of the SEC Reports, when filed, contained any untrue
statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. The financial statements
of the Company included in the SEC Reports comply in all material respects with applicable accounting requirements and the rules and regulations of the Commission with respect thereto as in effect at the time of filing. Such financial statements
(i)&nbsp;have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis during the periods involved (&#147;<U>GAAP</U>&#148;), except as may be otherwise specified in such financial
statements or the notes thereto and except that unaudited financial statements may not contain all footnotes required by GAAP, and (ii)&nbsp;fairly present in all material respects the financial position of the Company and its consolidated
Subsidiaries as of and for the dates thereof and the results of operations and cash flows for the periods then ended, subject, in the case of unaudited statements, to normal, year-end audit adjustments. The agreements and documents described in the
Registration Statement, the Prospectus, the Prospectus Supplement and the SEC Reports conform to the descriptions thereof contained therein and there are no agreements or other documents required by the Securities Act and the rules and regulations
thereunder to be described in the Registration Statement, the Prospectus, the Prospectus Supplement or the SEC Reports or to be filed with the Commission as exhibits to the Registration Statement, that have not been so described or filed. Each
agreement or other instrument (however characterized or described) to which the Company is a party or by which it is or may be bound or affected and (i)&nbsp;that is referred to in the Registration Statement, the Prospectus, the Prospectus
Supplement or the SEC Reports, or (ii)&nbsp;is material to the Company&#146;s business, has been duly authorized and validly executed by the Company, is in full force and effect in all material respects and is enforceable against the Company and, to
the </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">14 </P>


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Company&#146;s knowledge, the other parties thereto, in accordance with its terms, except (x)&nbsp;as such enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws
affecting creditors&#146; rights generally, (y)&nbsp;as enforceability of any indemnification or contribution provision may be limited under the federal and state securities laws, and (z)&nbsp;that the remedy of specific performance and injunctive
and other forms of equitable relief may be subject to the equitable defenses and to the discretion of the court before which any proceeding therefore may be brought. None of such agreements or instruments has been assigned by the Company, and
neither the Company nor, to the best of the Company&#146;s knowledge, any other party is in default thereunder and, to the best of the Company&#146;s knowledge, no event has occurred that, with the lapse of time or the giving of notice, or both,
would constitute a default thereunder. To the best of the Company&#146;s knowledge, performance by the Company of the material provisions of such agreements or instruments will not result in a violation of any existing applicable law, rule,
regulation, judgment, order or decree of any governmental agency or court, domestic or foreign, having jurisdiction over the Company or any of its assets or businesses, including, without limitation, those relating to environmental laws and
regulations. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(i) <U>Material Changes</U>. Since the date of the latest audited financial statements included within the
SEC Reports, except as specifically disclosed in the SEC Reports, (i)&nbsp;there has been no event, occurrence or development that has had or that could reasonably be expected to result in a Material Adverse Effect, except as has been reasonably
cured by the Company, (ii)&nbsp;the Company has not incurred any liabilities (contingent or otherwise) that are material to the Company or its Subsidiaries other than (A)&nbsp;trade payables, accrued expenses and other liabilities incurred in the
ordinary course of business consistent with past practice and (B)&nbsp;liabilities not required to be reflected in the Company&#146;s financial statements pursuant to GAAP or required to be disclosed in filings made with the Commission,
(iii)&nbsp;the Company has not altered its method of accounting in any material respect except as otherwise required pursuant to GAAP, (iv)&nbsp;the Company has not declared or made any dividend or distribution of cash or other property to its
stockholders or purchased, redeemed or made any agreements to purchase or redeem any shares of its capital stock (other than in connection with repurchases of unvested stock issued to employees of the Company) and (v)&nbsp;the Company has not issued
any equity securities to any officer, director or Affiliate, except pursuant to existing Company stock option and incentive plans or awards. Except for the requests filed in connection with the exhibits included in the Company&#146;s Form 10-K/A
filed on April&nbsp;29, 2013, the Company does not have pending before the Commission any request for confidential treatment of information. To the Company&#146;s knowledge, except for the transactions contemplated by this Agreement, no event,
liability, fact, circumstance, occurrence or development has occurred or exists or is reasonably expected to occur or exist with respect to the Company or its Subsidiaries or their respective businesses, prospects, properties, operations, assets or
financial condition that would be required to be disclosed by the Company under applicable securities laws at the time this representation is made or deemed made that has not been </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">15 </P>


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publicly disclosed at least 1 Trading Day prior to the date that this representation is made, except as would not be reasonably likely to result in an Material Adverse Effect. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(j) <U>Litigation</U>. Except as disclosed in the SEC Reports, there is no Proceeding pending or, to the knowledge of the
Company, threatened against or affecting the Company, any Subsidiary, or any of their respective properties, officers, or directors (in any such officer&#146;s or director&#146;s capacity as such) before or by any court, arbitrator, governmental or
administrative agency or regulatory authority (federal, state, county, local or foreign) which (i)&nbsp;adversely affects or challenges the legality, validity or enforceability of any of the Transaction Documents or the Securities, (ii)&nbsp;could,
if there were an unfavorable decision, ruling or finding, have or reasonably be expected to result in a Material Adverse Effect, or (iii)&nbsp;involves a claim or violation of, or liability under, any federal or state securities laws or which
involves a claim of breach of fiduciary duty. There has not been and, to the knowledge of the Company, there is not currently pending or contemplated, any investigation by the Commission involving the Company or any Subsidiary or any current or
former director or officer of the Company or any Subsidiary (in his or her capacity as such). The Commission has not issued any stop order or other order suspending the effectiveness of any registration statement filed by the Company or any
Subsidiary under the Exchange Act or the Securities Act and, to the Company&#146;s knowledge, no proceeding for such purpose is pending before or threatened by the Commission. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(k) <U>Compliance</U>. Neither the Company nor any Subsidiary (i)&nbsp;is in default under or in violation of (and no event has
occurred that has not been waived that, with notice or lapse of time or both, could reasonably be expected to result in a default by the Company or any Subsidiary under), nor has the Company or any Subsidiary received notice of a claim that it is in
default under or that it is in violation of, any indenture, loan or credit agreement or any other agreement or instrument to which it is a party or by which it or any of its properties is bound (whether or not such default or violation has been
waived), (ii)&nbsp;is in violation of any order of any court, arbitrator or governmental body, or (iii)&nbsp;is in violation of any statute, rule or regulation of any governmental authority or the Trading Market, including without limitation all
foreign, federal, state and local laws applicable to its business, except in each case as would not have a Material Adverse Effect. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(l) <U>Listing and Maintenance Requirements</U>. The Common Stock is registered pursuant to Section&nbsp;12(b) of the Exchange
Act, and the Company has taken no action designed to, or which to its knowledge is likely to have the effect of, terminating the registration of the Common Stock under the Exchange Act, nor has the Company received any notification that the
Commission is contemplating terminating such registration. The Company has not, in the 12 months preceding the date hereof or the Closing Date, received notice from any Trading Market on which the Common Stock is or has been listed or quoted (as
applicable) to the effect that the Company is not in compliance with the listing or quotation (as </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">16 </P>


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applicable) and maintenance requirements of such Trading Market. The Company is, and immediately after the consummation of the transactions contemplated hereby will be, in compliance with all
such listing or quotation (as applicable) and maintenance requirements. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(m) <U>Application of Takeover Protections</U>.
The Company and its Board of Directors have taken all necessary action, if any, in order to render inapplicable any control share acquisition, business combination, poison pill (including any distribution under a rights agreement) or other similar <FONT
STYLE="white-space:nowrap">anti-takeover</FONT> provision under the Company&#146;s certificate of incorporation (or similar charter documents) and the laws of its state of incorporation that is or could become applicable to the Underwriters as a
result of the Underwriters and the Company fulfilling their obligations or exercising their rights under the Transaction Documents, including, without limitation, the Company&#146;s issuance of the Securities and the Underwriters&#146; ownership of
the Securities. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(n) <U>Effective Registration Statement</U>. The Registration Statement has been declared effective by the
Commission and remains effective as of the date hereof and the Company knows of no reason why the Registration Statement will not continue to remain effective for the foreseeable future. The Company is eligible to use Form S-3 registration
statements for the issuance of securities. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(o) <U>Intellectual Property</U>. The Company possesses such right, title and
interest in and to, or possesses adequate rights to use, all patents, patent rights, trade secrets, inventions, know-how, trademarks, trade names, copyrights, service marks and other proprietary rights (&#147;<U>Intellectual Property</U>&#148;)
material to the conduct of the Company&#146;s business except Intellectual Property the failure of which to possess would not have a Material Adverse Effect. Except as disclosed in the SEC Reports, the Company has not received any notice of
infringement, misappropriation or conflict from any third party as to Intellectual Property owned by or exclusively licensed to the Company that has not been resolved or disposed of, which infringement, misappropriation or conflict would, if the
subject of an unfavorable decision, ruling or finding, have a Material Adverse Effect. To the Company&#146;s knowledge, it has not infringed, misappropriated, or otherwise conflicted with the Intellectual Property of any third parties, which
infringement, misappropriation or conflict would, if the subject of an unfavorable decision, ruling or finding, have a Material Adverse Effect. The Company and its Subsidiaries have taken reasonable security measures to protect the secrecy,
confidentiality and value of all of their intellectual properties, except where failure to do so could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(p) <U>Permits</U>. The Company has made all filings, applications and submissions required by, and possesses all approvals,
licenses, certificates, certifications, clearances, consents, exemptions, marks, notifications, orders, permits and other authorizations issued by, the appropriate federal, state or foreign regulatory authorities necessary to own or lease its
properties and to </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">17 </P>


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conduct its businesses (collectively, &#147;<U>Permits</U>&#148;), except for such Permits the failure of which to possess or obtain would not reasonably be expected to have a Material Adverse
Effect. The Company has not received any written notice of proceedings relating to the limitation, revocation, cancellation, suspension, modification or non-renewal of any such Permit which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would have a Material Adverse Effect, and has no reason to believe that any such Permit will not be renewed in the ordinary course. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(q) <U>Insurance</U>. The Company and the Subsidiaries are insured by insurers of recognized financial responsibility against
such losses and risks and in such amounts as are prudent and customary in the businesses in which the Company and the Subsidiaries are engaged, including, but not limited to, directors and officers insurance coverage. Neither the Company nor any
Subsidiary has any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(r) <U>Disclosure</U>. The Company confirms that, as of the date hereof and as of the Closing Date, neither the Company nor any
officer, director or employee of the Company acting on its behalf (as such term is used in Regulation FD) has provided or will provide the Underwriters or their agents or counsel with any information that the Company believes may constitute
material, non-public information except insofar as the existence and terms of the proposed transactions hereunder may constitute such information. The Company understands and confirms that the Underwriters will rely on the foregoing representations
and covenants in effecting transactions in securities of the Company. None of the representations and warranties of the Company contained herein, nor any statement made by the Company in any disclosure, schedule, exhibit, certificate or other
document furnished or to be furnished to the Underwriters in connection herewith, contains or will contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in light of
the circumstances under which they were made, not misleading. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(s) <U>Sarbanes-Oxley</U>. The Company and the Subsidiaries
are in material compliance with any and all applicable requirements of the Sarbanes-Oxley Act of 2002 that are effective as of the date hereof, and any and all applicable rules and regulations promulgated by the Commission thereunder that are
effective as of the date hereof and as of the Closing Date. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(t) <U>Certain Fees</U>. Except as set forth in the
Preliminary Prospectus or the Prospectus Supplement, no brokerage or finder&#146;s fees or commissions are or will be payable by the Company or any Subsidiary to any broker, financial advisor or consultant, finder, placement agent, investment
banker, bank or other Person with respect to the transactions contemplated by the Transaction Documents. The Underwriters shall have no obligation or liability with respect to any fees or with respect to any claims made by or on behalf of other
Persons for fees of a type contemplated in this Section that may be due in connection with the transactions contemplated by the Transaction Documents. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">18 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(u) <U>10b-5</U>. The Registration Statement (and any further documents to be
filed with the Commission) contains all exhibits and schedules as required by the Securities Act. Each of the Registration Statement and any post-effective amendment thereto, if any, at the time it became effective, complied in all material respects
with the Securities Act and the Exchange Act and the applicable rules and regulations under the Securities Act and did not and, as amended or supplemented, if applicable, will not, contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements therein not misleading. The Prospectus and the Prospectus Supplement, each as of its respective date, comply in all material respects with the Securities Act and the
Exchange Act and the applicable rules and regulations. Each of the Prospectus and the Prospectus Supplement, as amended or supplemented, did not and will not contain as of the date thereof any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. The SEC Reports, when they were filed with the Commission, conformed in all material respects to the
requirements of the Exchange Act and the applicable rules and regulations, and none of such documents, when they were filed with the Commission, contained any untrue statement of a material fact or omitted to state a material fact necessary to make
the statements therein (with respect to the SEC Reports incorporated by reference in the Prospectus or Prospectus Supplement), in light of the circumstances under which they were made, not misleading; and any further documents so filed and
incorporated by reference in the Prospectus or Prospectus Supplement, when such documents are filed with the Commission, will conform in all material respects to the requirements of the Exchange Act and the applicable rules and regulations, as
applicable, and will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. No post-effective amendment
to the Registration Statement reflecting any facts or events arising after the date thereof which represent, individually or in the aggregate, a fundamental change in the information set forth therein is required to be filed with the Commission.
There are no documents required to be filed with the Commission in connection with the transaction contemplated hereby that (x)&nbsp;have not been filed as required pursuant to the Securities Act or (y)&nbsp;will not be filed within the requisite
time period. There are no contracts or other documents required to be described in the Prospectus or Prospectus Supplement, or to be filed as exhibits or schedules to the Registration Statement, which have not been described or filed as required.
The press releases disseminated by the Company during the twelve months preceding the date of this Agreement taken as a whole do not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in light of the circumstances under which they were made and when made, not misleading. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">19 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(v) <U>Foreign Corrupt Practices</U>. Neither the Company nor any Subsidiary, nor
to the knowledge of the Company or any Subsidiary, any agent or other person acting on behalf of the Company or any Subsidiary, has (i)&nbsp;directly or indirectly, used any funds for unlawful contributions, gifts, entertainment or other unlawful
expenses related to foreign or domestic political activity, (ii)&nbsp;made any unlawful payment to foreign or domestic government officials or employees or to any foreign or domestic political parties or campaigns from corporate funds,
(iii)&nbsp;failed to disclose fully any contribution made by the Company or any Subsidiary (or made by any person acting on its behalf of which the Company is aware) which is in violation of law, or (iv)&nbsp;violated in any material respect any
provision of FCPA. The Company has taken reasonable steps to ensure that its accounting controls and procedures are sufficient to cause the Company to comply in all material respects with the FCPA. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(w) <U>FDA</U>. As to each product subject to the jurisdiction of the U.S. Food and Drug Administration
(&#147;<U>FDA</U>&#148;) under the Federal Food, Drug and Cosmetic Act, as amended, and the regulations thereunder (&#147;<U>FDCA</U>&#148;) that is manufactured, packaged, labeled, tested, distributed, sold, and/or marketed by the Company or any of
its Subsidiaries (each such product, a &#147;<U>Pharmaceutical Product</U>&#148;), such Pharmaceutical Product is being manufactured, packaged, labeled, tested, distributed, sold and/or marketed by the Company in compliance with all applicable
requirements under FDCA and similar laws, rules and regulations relating to registration, investigational use, premarket clearance, licensure, or application approval, good manufacturing practices, good laboratory practices, good clinical practices,
product listing, quotas, labeling, advertising, record keeping and filing of reports, except where the failure to be in compliance would not have a Material Adverse Effect. There is no pending, completed or, to the Company&#146;s knowledge,
threatened, action (including any lawsuit, arbitration, or legal or administrative or regulatory proceeding, charge, complaint, or investigation) against the Company or any of its Subsidiaries, and none of the Company or any of its Subsidiaries has
received any notice, warning letter or other communication from the FDA or any other governmental entity, which (i)&nbsp;contests the premarket clearance, licensure, registration, or approval of, the uses of, the distribution of, the manufacturing
or packaging of, the testing of, the sale of, or the labeling and promotion of any Pharmaceutical Product, (ii)&nbsp;withdraws its approval of, requests the recall, suspension, or seizure of, or withdraws or orders the withdrawal of advertising or
sales promotional materials relating to, any Pharmaceutical Product, (iii)&nbsp;imposes a clinical hold on any clinical investigation by the Company or any of its Subsidiaries, (iv)&nbsp;enjoins production at any facility of the Company or any of
its Subsidiaries, (v)&nbsp;enters or proposes to enter into a consent decree of permanent injunction with the Company or any of its Subsidiaries, or (vi)&nbsp;otherwise alleges any violation of any laws, rules or regulations by the Company or any of
its Subsidiaries, and which, either individually or in the aggregate, would have a Material Adverse Effect. The properties, business and operations of the Company have been and are being conducted in all material respects in accordance with all
applicable laws, rules and regulations of the FDA. The Company has not been informed by the FDA that the </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">20 </P>


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FDA will prohibit the marketing, sale, license or use in the United States of any product proposed to be developed, produced or marketed by the Company nor has the FDA expressed any concern as to
approving or clearing for marketing any product being developed or proposed to be developed by the Company. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(x) <U>FINRA
Affiliation</U>. No officer, director or any beneficial owner of 5% or more of the Company&#146;s unregistered securities has any direct or indirect affiliation or association with any FINRA member (as determined in accordance with the rules and
regulations of FINRA). </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(y) <U>Officers&#146; Certificate</U>. Any certificate signed by any duly authorized officer of the
Company and delivered to you or to PC shall be deemed a representation and warranty by the Company to the Underwriters as to the matters covered thereby. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(z) <U>Regulation M Compliance</U>. The Company has not, and to its knowledge no one acting on its behalf has, (i)&nbsp;taken,
directly or indirectly, any action designed to cause or to result in the stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of any of the Securities, (ii)&nbsp;sold, bid for, purchased, or,
paid any compensation for soliciting purchases of, any of the Securities, or (iii)&nbsp;paid or agreed to pay to any Person any compensation for soliciting another to purchase any other securities of the Company, other than, in the case of clauses
(ii)&nbsp;and (iii), compensation paid to the Company&#146;s placement agent in connection with the placement of the Securities. </P>
<P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>ARTICLE IV. </B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>OTHER
AGREEMENTS OF THE PARTIES </B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">4.1 <U>Amendments to Registration Statement</U>. The Company has delivered, or will as promptly as
practicable deliver, to the Underwriters complete conformed copies of the Registration Statement and of each consent and certificate of experts, as applicable, filed as a part thereof, and conformed copies of the Registration Statement (without
exhibits), the Prospectus and any Prospectus Supplement, as amended or supplemented, in such quantities and at such places as an Underwriter reasonably requests. Neither the Company nor any of its directors and officers has distributed and none of
them will distribute, prior to the Closing Date, any offering material in connection with the offering and sale of the Securities other than the Prospectus, the Preliminary Prospectus, the Registration Statement, and copies of the documents
incorporated by reference therein. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">4.2 <U>Federal Securities Laws</U>. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(a) <U>Compliance</U>. During the time when a Prospectus is required to be delivered under the Securities Act, the Company will
use commercially reasonable efforts to comply with all requirements imposed upon it by the Securities Act and the rules and regulations thereunder and the Exchange Act and the rules and regulations thereunder, as from time to time in force, so far
as necessary to permit the continuance of sales of or dealings in the Securities in </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">21 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">
accordance with the provisions hereof and the Prospectus. If at any time when a Prospectus relating to the Securities is required to be delivered under the Securities Act, any event shall have
occurred as a result of which, in the opinion of counsel for the Company or counsel for the Underwriters, the Prospectus, as then amended or supplemented, includes an untrue statement of a material fact or omits to state any material fact required
to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, or if it is necessary at any time to amend the Prospectus to comply with the Securities Act, the Company will
notify the Underwriters promptly and prepare and file with the Commission, subject to Section&nbsp;4.1 hereof, an appropriate amendment or supplement in accordance with Section&nbsp;10 of the Securities Act. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(b) <U>Filing of Final Prospectus</U>. The Company will file the Prospectus (in form and substance satisfactory to the
Representative) with the Commission pursuant to the requirements of Rule 424. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(c) <U>Free Writing Prospectuses</U>. The
Company represents and agrees that it has not made and will not make any offer relating to the Securities that would constitute an issuer free writing prospectus, as defined in Rule 433 of the rules and regulations under the Securities Act, without
the prior consent of the Representative. Any such free writing prospectus consented to by the Representative is hereinafter referred to as a &#147;<U>Permitted Free Writing Prospectus</U>.&#148; The Company represents that it will treat each
Permitted Free Writing Prospectus as an &#147;issuer free writing prospectus&#148; as defined in rule and regulations under the Securities Act, and has complied and will comply with the applicable requirements of Rule 433 of the Securities Act,
including timely Commission filing where required, legending and record keeping. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">4.3 <U>Delivery to the Underwriters of Prospectuses</U>.
The Company will deliver to the Underwriters, without charge, from time to time during the period when the Prospectus is required to be delivered under the Securities Act or the Exchange Act such number of copies of each Prospectus as the
Underwriters may reasonably request. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">4.4 <U>Effectiveness and Events Requiring Notice to the Underwriters</U>. During the period when the
Prospectus is required to be delivered under the Securities Act, the Company will use commercially reasonable efforts to cause the Registration Statement to remain effective with a current prospectus, and will notify the Underwriters immediately and
confirm the notice in writing: (i)&nbsp;of the issuance by the Commission of any stop order or of the initiation, or the threatening, of any proceeding for that purpose; (ii)&nbsp;of the issuance by any state securities commission of any proceedings
for the suspension of the qualification of the Securities for offering or sale in any jurisdiction or of the initiation, or the threatening, of any proceeding for that purpose; (iii)&nbsp;of the mailing and delivery to the Commission for filing of
any amendment or supplement to the Registration Statement or Prospectus under the Securities Act in respect of the Securities; (iv)&nbsp;of the receipt of any comments or request for any additional information from the Commission; and (v)&nbsp;of
the happening of any event during the period described in this Section&nbsp;4.4 that, in the </P>
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judgment of the Company, makes any statement of a material fact made in the Registration Statement, the Prospectus or any Prospectus Supplement untrue or that requires the making of any changes
in the Registration Statement, the Prospectus or any Prospectus Supplement in order to make the statements therein, in light of the circumstances under which they were made, not misleading. If the Commission or any state securities commission shall
enter a stop order or suspend such qualification at any time, the Company will make commercially reasonable efforts to obtain promptly the lifting of such order. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">4.5 <U>Reports to the Underwriters</U>. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(a) <U>Periodic Reports, etc</U>. For a period of three years from the Execution Date, the Company will furnish to the
Underwriters copies of such financial statements and other periodic and special reports as the Company from time to time furnishes generally to holders of any class of its securities and also promptly furnish to the Underwriters: (i)&nbsp;a copy of
each periodic report the Company has filed with the Commission; (ii)&nbsp;a copy of each Form 8-K prepared and filed by the Company; and (iii)&nbsp;a copy of each registration statement filed by the Company under the Securities Act; <U>provided</U>,
that documents filed with the Commission pursuant to its EDGAR system shall be deemed to have been delivered to the Underwriters pursuant to this Section. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(b) <U>General Expenses Related to the Offering</U>. The Company hereby agrees to pay all expenses incident to the performance
of the obligations of the Company under this Agreement, including, but not limited to: (a)&nbsp;all filing fees and communication expenses relating to the registration of the Securities to be sold in the Offering with the Commission; (b)&nbsp;all
The Public Offering System (formerly COBRADesk) filing fees associated with the review of the Offering by FINRA; all fees and expenses relating to the listing of such Closing Shares, Option Shares and Warrant Shares on the Trading Market and such
other stock exchanges as the Company and the Representative together determine; (c)&nbsp;the costs of all mailing and printing of the Registration Statements, Preliminary Prospectuses, Prospectuses and all amendments, supplements and exhibits
thereto as the Representative may reasonably deem necessary; (d)&nbsp;the costs of preparing, printing and delivering certificates representing the Securities; (e)&nbsp;fees and expenses of the Transfer Agent for the Securities; (f)&nbsp;stock
transfer and/or stamp taxes, if any, payable upon the transfer of Securities from the Company to the Underwriters; (g)&nbsp;the fees and expenses of the Company&#146;s accountants; and (h)&nbsp;the fees and expenses of the Company&#146;s legal
counsel and other agents and representatives. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">4.6 <U>Application of Net Proceeds</U>. The Company will apply the net proceeds from the
Offering received by it in a manner consistent with the application described under the caption &#147;Use Of Proceeds&#148; in the Prospectus. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">23 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">4.7 <U>Delivery of Earnings Statements to Security Holders</U>. The Company will make generally
available to its security holders as soon as practicable, but not later than the first day of the fifteenth full calendar month following the Execution Date, an earnings statement (which need not be certified by independent public or independent
certified public accountants unless required by the Securities Act or the Rules and Regulations under the Securities Act, but which shall satisfy the provisions of Rule 158(a) under Section&nbsp;11(a) of the Securities Act) covering a period of at
least twelve consecutive months beginning after the Execution Date. Such earning statement filed with the Commission pursuant to its EDGAR system shall be deemed to have been made available to the security holders pursuant to this Section. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">4.8 <U>Stabilization</U>. Neither the Company, nor, to its knowledge, any of its employees, directors or shareholders (without the consent of
the Representative) has taken or will take, directly or indirectly, any action designed to or that has constituted or that might reasonably be expected to cause or result in, under the Exchange Act, or otherwise, stabilization or manipulation of the
price of any security of the Company to facilitate the sale or resale of the Securities. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">4.9 <U>Internal Controls</U>. The Company will
maintain a system of internal accounting controls sufficient to provide reasonable assurances that: (i)&nbsp;transactions are executed in accordance with management&#146;s general or specific authorization; (ii)&nbsp;transactions are recorded as
necessary in order to permit preparation of financial statements in accordance with GAAP and to maintain accountability for assets; (iii)&nbsp;access to assets is permitted only in accordance with management&#146;s general or specific authorization;
and (iv)&nbsp;the recorded accountability for assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">4.10 <U>Accountants</U>. For a period of three (3)&nbsp;years from the Execution Date, the Company shall continue to retain a nationally
recognized independent certified public accounting firm. The Underwriters acknowledge that the Company Auditor is acceptable to the Underwriters. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">4.11 <U>No Fiduciary Duties</U>. The Company acknowledges and agrees that the Underwriters&#146; responsibility to the Company is solely
contractual and commercial in nature, based on arms-length negotiations and that neither the Underwriters nor their affiliates or any Selected Dealer shall be deemed to be acting in a fiduciary capacity, or otherwise owes any fiduciary duty to the
Company or any of its affiliates in connection with the Offering and the other transactions contemplated by this Agreement. Notwithstanding anything in this Agreement to the contrary, the Company acknowledges that the Underwriters may have financial
interests in the success of the Offering that are not limited to the difference between the price to the public and the purchase price paid to the Company by the Underwriters for the shares and the Underwriters have no obligation to disclose, or
account to the Company for, any of such additional financial interests. The Company hereby waives and releases, to the fullest extent permitted by law, any claims that the Company may have against the Underwriters with respect to any breach or
alleged breach of fiduciary duty. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">24 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">4.12 <U>Warrant Shares</U>. Provided that the holder of the Warrant is not an affiliate of the
Company under Rule 144 promulgated under the Securities Act, if all or any portion of a Warrant is exercised at a time when there is an effective registration statement to cover the issuance of the Warrant Shares or if the Warrant is exercised via
cashless exercise at a time when such Warrant Shares would be eligible for resale under Rule 144 by a non-affiliate of the Company, the Warrant Shares issued pursuant to any such exercise shall be issued free of all restrictive legends. If at any
time following the date hereof the Registration Statement (or any subsequent registration statement registering the sale or resale of the Warrant Shares) is not effective or is not otherwise available for the sale of the Warrant Shares, the Company
shall immediately notify the holders of the Warrants in writing that such registration statement is not then effective and thereafter shall promptly notify such holders when the registration statement is effective again and available for the sale of
the Warrant Shares (it being understood and agreed that the foregoing shall not limit the ability of the Company to issue, or any holder thereof to sell, any of the Warrant Shares in compliance with applicable federal and state securities laws).
</P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">4.13 <U>Securities Laws Disclosure; Publicity</U>. At the request of the Representative, at 9:00 AM on the date hereof, the Company shall
issue a press release disclosing the material terms of the Offering. The Company and the Representative shall consult with each other in issuing any other press releases with respect to the Offering, and neither the Company nor any Underwriter shall
issue any such press release nor otherwise make any such public statement without the prior consent of the Company, with respect to any press release of such Underwriter, or without the prior consent of such Underwriter, with respect to any press
release of the Company, which consent shall not unreasonably be withheld or delayed, except if such disclosure is required by law, in which case the disclosing party shall promptly provide the other party with prior notice of such public statement
or communication. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">4.14 <U>Shareholder Rights Plan</U>. No claim will be made or enforced by the Company or, with the consent of the
Company, any other Person, that any Underwriter of the Securities is an &#147;Acquiring Person&#148; under any control share acquisition, business combination, poison pill (including any distribution under a rights agreement) or similar
anti-takeover plan or arrangement in effect or hereafter adopted by the Company, or that any Underwriter of Securities could be deemed to trigger the provisions of any such plan or arrangement, by virtue of receiving Securities. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">4.15 <U>Reservation of Common Stock</U>. As of the date hereof, the Company has reserved and the Company shall continue to reserve and keep
available at all times, free of preemptive rights, a sufficient number of shares of Common Stock for the purpose of enabling the Company to issue Warrant Shares pursuant to any exercise of the Warrants. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">4.16 <U>Listing of Common Stock</U>. For a period of three (3)&nbsp;years from the Execution Date, the Company hereby agrees to use
commercially reasonable efforts to </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">25 </P>


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maintain the listing or quotation of the Common Stock on the Trading Market on which it is then-currently listed, and concurrently with the Closing, the Company shall apply to list all of the
Closing Shares, Option Shares and Warrant Shares on the Nasdaq Capital Market. The Company further agrees, if the Company applies to have the Common Stock traded on any other Trading Market, it will then include in such application all of the
Closing Shares, and will take such other action as is necessary to cause all of the Closing Shares to be listed or quoted on such other Trading Market as promptly as possible. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">4.17 <U>Subsequent Equity Sales</U>. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(a) Without the prior written consent of the Representative, from the date hereof through the earlier of (i)&nbsp;the 90<SUP
STYLE="font-size:85%; vertical-align:top">th</SUP> day from the date hereof and (ii)&nbsp;the trading day immediately following the date after which the closing price of the Common Stock is equal to or in excess of $2.50 (as may be adjusted for
stock splits, dividends, and other similar transactions) for three consecutive trading days (the &#147;<U>Restriction Period</U>&#148;), neither the Company nor any Subsidiary shall (A)&nbsp;issue, enter into any agreement to issue or announce the
issuance or proposed issuance of any shares of Common Stock or Common Stock Equivalents or (B)&nbsp;sell shares of Common Stock pursuant to the Company&#146;s existing &#147;at-the-market&#148; offering through Cantor Fitzgerald, as more thoroughly
described in the prospectus supplement, dated December&nbsp;28, 2012, and filed by the Company with the Commission pursuant to Rule 424(b)(5), or through a similar facility entered into subsequent to the date hereof (an &#147;<U>At-The-Market
Offering</U>&#148;) in each of (A)&nbsp;and (B)&nbsp;above at a price per share of Common Stock less than the Per Unit Purchase Price. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(b) Notwithstanding the foregoing, this Section&nbsp;4.17 shall not apply in respect of an Exempt Issuance. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">4.18 <U>Capital Changes</U>. Until one year from the Closing Date, and other than to maintain compliance with the listing requirements of the
Trading Market, the Company shall not undertake a reverse or forward stock split or reclassification of the Common Stock without the prior written consent of the Representative. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">4.19 <U>Research Independence</U>. In addition, the Company acknowledges that each Underwriter&#146;s research analysts and research
departments, if any, are required to be independent from their respective investment banking divisions and are subject to certain regulations and internal policies, and that such Underwriter&#146;s research analysts may hold and make statements or
investment recommendations and/or publish research reports with respect to the Company and/or the offering that differ from the views of its investment bankers. The Company acknowledges that the Representative is a full service securities firm and
as such from time to time, subject to applicable securities laws, the Representative may effect transactions for its own account or the account of its customers and hold long or short position in debt or equity securities of the Company. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">26 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">4.20 <U>Certain Agreements of the Underwriters</U>. The Underwriters hereby represent and agree
that: </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(a) They have not used, authorized use of, referred to or participated in the planning for use of, and will not use,
authorize use of, refer to or participate in the planning for use of, any &#147;free writing prospectus&#148;, as defined in Rule 405 under the Securities Act (which term includes use of any written information furnished to the Commission by the
Company and not incorporated by reference into the Registration Statement and any press release issued by the Company) other than (i)&nbsp;a free writing prospectus that contains no &#147;issuer information&#148; (as defined in Rule 433(h)(2) under
the Securities Act) that was not included (including through incorporation by reference) in the Preliminary Prospectus or a previously filed issuer free writing prospectus, as defined in Rule 433 of the rules and regulations under the Securities
Act, or (ii)&nbsp;any Permitted Free Writing Prospectus prepared pursuant to Section&nbsp;4.2(c) above (including any electronic road show), or (iii)&nbsp;any free writing prospectus prepared by an Underwriter and approved by the Company in advance
in writing (each such free writing prospectus referred to in clauses (i)&nbsp;or (iii), an &#147;<U>Underwriter Free Writing Prospectus</U>&#148;); </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(b) They have not and will not, without the prior written consent of the Company, use any free writing prospectus that contains
the final terms of the Securities unless such terms have previously been included in a free writing prospectus filed with the Commission; <U>provided</U> that the Underwriters may use a term sheet substantially in the form of Annex A hereto without
the consent of the Company; <U>provided</U> <U>further</U> that the Underwriters using such term sheet shall notify the Company, and provide a copy of such term sheet to the Company, prior to, or substantially concurrently with, the first use of
such term sheet. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(c) They are not subject to any pending proceeding under Section&nbsp;8A of the Securities Act with
respect to the Offering (and will promptly notify the Company if any such proceeding against it is initiated during the period when the Prospectus is required to be delivered under the Securities Act or the Exchange Act). </P>
<P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>ARTICLE V. </B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>DEFAULT BY
UNDERWRITERS </B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">If on the Closing Date any Underwriter shall fail to purchase and pay for the portion of the Closing Shares or Closing
Warrants which such Underwriter has agreed to purchase and pay for on such date (otherwise than by reason of any default on the part of the Company), the Representatives, or if a Representative is the defaulting Underwriter, the non-defaulting
Underwriters, shall use commercially reasonable efforts to procure within 36 hours thereafter one or more of the other Underwriters, or any others, to purchase from the Company such amounts as may be agreed upon and upon the terms set forth herein,
the Securities which the defaulting Underwriter or Underwriters failed to purchase. If during such 36 hours the Representative shall not have procured such other Underwriters, or any others, to purchase the Securities agreed to be purchased by the
</P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">27 </P>


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defaulting Underwriter or Underwriters, then (a)&nbsp;if the aggregate number of Securities with respect to which such default shall occur does not exceed 10% of the Securities covered hereby,
the other Underwriters shall be obligated, severally, in proportion to the respective numbers of Securities which they are obligated to purchase hereunder, to purchase the Securities which such defaulting Underwriter or Underwriters failed to
purchase, or (b)&nbsp;if the aggregate number of Securities with respect to which such default shall occur exceeds 10% of the Securities covered hereby, the Company or the Representatives will have the right to terminate this Agreement without
liability on the part of the non-defaulting Underwriters or of the Company except to the extent provided in Article VI hereof. In the event of a default by any Underwriter or Underwriters, as set forth in this Article V, the applicable Closing Date
may be postponed for such period, not exceeding seven days, as the Representatives, or if a Representative is a defaulting Underwriter, the non-defaulting Underwriters, may determine in order that the required changes in the Prospectus or in any
other documents or arrangements may be effected. The term &#147;Underwriter&#148; includes any Person substituted for a defaulting Underwriter. Any action taken under this Section shall not relieve any defaulting Underwriter from liability in
respect of any default of such Underwriter under this Agreement. </P> <P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>ARTICLE VI. </B></P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>INDEMNIFICATION </B></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">6.1
<U>Indemnification of the Underwriters</U>. Subject to the conditions set forth below, the Company agrees to indemnify and hold harmless the Underwriters, and each dealer selected by each Underwriter that participates in the offer and sale of the
Securities (each a &#147;<U>Selected Dealer</U>&#148;) and each of their respective directors, officers and employees and each Person, if any, who controls such Underwriter or any Selected Dealer (&#147;<U>Controlling Person</U>&#148;) within the
meaning of Section&nbsp;15 of the Securities Act or Section&nbsp;20 of the Exchange Act, against any and all loss, liability, claim, damage and expense whatsoever (including but not limited to any and all legal or other expenses reasonably incurred
in investigating, preparing or defending against any litigation, commenced or threatened, or any claim whatsoever, whether arising out of any action between such Underwriter and the Company or between such Underwriter and any third party or
otherwise) to which they or any of them may become subject under the Securities Act, the Exchange Act or any other statute or at common law or otherwise or under the laws of foreign countries, arising out of or based upon any untrue statement or
alleged untrue statement of a material fact contained in (i)&nbsp;any Preliminary Prospectus, if any, the Registration Statement or the Prospectus (as from time to time each may be amended and supplemented); or (ii)&nbsp;any materials or information
provided to investors by, or with the approval of, the Company in connection with the marketing of the Offering of the Securities, including any &#147;road show&#148; or investor presentations made to investors by the Company (whether in person or
electronically) (collectively, the &#147;<U>Road Show Materials</U>&#148;); or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, unless such statement or omission was made in reliance upon and in conformity with written information furnished to the Company by any Underwriter expressly for use in any Preliminary Prospectus, if any,
the Registration Statement or Prospectus, or any amendment or </P>
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supplement thereof, or in any Road Show Materials, as the case may be. With respect to any untrue statement or omission or alleged untrue statement or omission made in the Preliminary Prospectus,
if any, the indemnity agreement contained in this Section&nbsp;6.1 shall not inure to the benefit of an Underwriter to the extent that any loss, liability, claim, damage or expense of such Underwriter results from the fact that a copy of the
Prospectus was not given or sent to the Person asserting any such loss, liability, claim or damage at or prior to the written confirmation of sale of the Securities to such Person as required by the Securities Act and the rules and regulations
thereunder, and if the untrue statement or omission has been corrected in the Prospectus, unless such failure to deliver the Prospectus was a result of non-compliance by the Company with its obligations under this Agreement. The Company agrees
promptly to notify each Underwriter of the commencement of any litigation or proceedings against the Company or any of its officers, directors or Controlling Persons in connection with the issue and sale of the Securities or in connection with the
Prospectus. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">6.2 <U>Procedure</U>. If any action is brought against an Underwriter, a Selected Dealer or a Controlling Person in respect
of which indemnity may be sought against the Company pursuant to Section&nbsp;6.1, such Underwriter, such Selected Dealer or Controlling Person, as the case may be, shall promptly notify the Company in writing of the institution of such action and
the Company shall assume the defense of such action, including the employment and fees of counsel (subject to the reasonable approval of such Underwriter or such Selected Dealer, as the case may be) and payment of actual expenses. Such Underwriter,
such Selected Dealer or Controlling Person shall have the right to employ its or their own counsel in any such case, but the fees and expenses of such counsel shall be at the expense of such Underwriter, such Selected Dealer or Controlling Person
unless (i)&nbsp;the employment of such counsel at the expense of the Company shall have been authorized in writing by the Company in connection with the defense of such action, or (ii)&nbsp;the Company shall not have employed counsel to have charge
of the defense of such action, or (iii)&nbsp;such indemnified party or parties shall have reasonably concluded that there may be defenses available to it or them which are different from or additional to those available to the Company (in which case
the Company shall not have the right to direct the defense of such action on behalf of the indemnified party or parties), in any of which events the reasonable fees and expenses of not more than one additional firm of attorneys selected by such
Underwriter (in addition to local counsel), Selected Dealer and/or Controlling Person, taken together as a group, shall be borne by the Company. In no event shall the Company be liable for fees and expenses of more than one firm of attorneys (in
addition to any local counsel) separate from its own counsel for all indemnified parties in connection with any one action or separate but similar or related actions in the same jurisdiction arising out of the same general allegations or
circumstances. Notwithstanding anything to the contrary contained herein, if any Underwriter, Selected Dealer or Controlling Person shall assume the defense of such action as provided above, the Company shall have the right to approve the terms of
any settlement of such action which approval shall not be unreasonably withheld. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">6.3 <U>Indemnification of the Company</U>. Each
Underwriter, severally not jointly, agrees to indemnify and hold harmless the Company, its directors, officers and </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">29 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
employees and agents who control the Company within the meaning of Section&nbsp;15 of the Securities Act or Section&nbsp;20 of the Exchange Act against any and all loss, liability, claim, damage
and expense described in the foregoing indemnity from the Company to such Underwriter, as incurred, but only with respect to untrue statements or omissions, or alleged untrue statements or omissions made in any Preliminary Prospectus, if any, the
Registration Statement or Prospectus or any amendment or supplement thereto or in any Road Show Materials, in reliance upon, and in conformity with, written information furnished to the Company with respect to such Underwriter by or on behalf of
such Underwriter expressly for use in such Preliminary Prospectus, if any, the Registration Statement or Prospectus or any amendment or supplement thereto or in any such Road Show Materials. In case any action shall be brought against the Company or
any other Person so indemnified based on any Preliminary Prospectus, if any, the Registration Statement or Prospectus or any amendment or supplement thereto or any Road Show Materials, and in respect of which indemnity may be sought against such
Underwriter, such Underwriter shall have the rights and duties given to the Company, and the Company and each other Person so indemnified shall have the rights and duties given to such Underwriter by the provisions of this Article V. Notwithstanding
the provisions of this Section&nbsp;6.3, no Underwriter shall be required to indemnify the Company for any amount in excess of the underwriting discounts and commissions applicable to the Securities purchased by such Underwriter. The
Underwriters&#146; obligations in this Section&nbsp;6.3 to indemnify the Company are several in proportion to their respective underwriting obligations and not joint. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">6.4 <U>Contribution</U>. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(a) <U>Contribution Rights</U>. In order to provide for just and equitable contribution under the Securities Act in any case in
which (i)&nbsp;any Person entitled to indemnification under this Article VI makes a claim for indemnification pursuant hereto but it is judicially determined (by the entry of a final judgment or decree by a court of competent jurisdiction and the
expiration of time to appeal or the denial of the last right of appeal) that such indemnification may not be enforced in such case notwithstanding the fact that this Article VI provides for indemnification in such case, or (ii)&nbsp;contribution
under the Securities Act, the Exchange Act or otherwise may be required on the part of any such Person in circumstances for which indemnification is provided under this Article VI, then, and in each such case, the Company and each Underwriter,
severally and not jointly, shall contribute to the aggregate losses, liabilities, claims, damages and expenses of the nature contemplated by said indemnity agreement incurred by the Company and such Underwriter, as incurred, in such proportions as
is appropriate to reflect the relative benefits received by the Company, on the one hand, and the Underwriters, on the other hand, from the offering of the Securities pursuant to this Agreement; provided, that, no Person guilty of a fraudulent
misrepresentation (within the meaning of Section&nbsp;11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation. For purposes of this Section, each director, officer and
employee of such Underwriter or the Company, as applicable, and each Person, if any, who controls such Underwriter or the Company, as applicable, within the </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">30 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">
meaning of Section&nbsp;15 of the Securities Act shall have the same rights to contribution as such Underwriter or the Company, as applicable. Notwithstanding the provisions of this
Section&nbsp;6.4, no Underwriter shall be required to contribute any amount in excess of the underwriting discounts and commissions applicable to the Securities purchased by such Underwriter. The Underwriters&#146; obligations in this
Section&nbsp;6.4 to contribute are several in proportion to their respective underwriting obligations and not joint. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(b)
<U>Contribution Procedure</U>. Within fifteen days after receipt by any party to this Agreement (or its representative) of notice of the commencement of any action, suit or Proceeding, such party will, if a claim for contribution in respect thereof
is to be made against another party (&#147;<U>Contributing Party</U>&#148;), notify the Contributing Party of the commencement thereof, but the failure to so notify the Contributing Party will not relieve it from any liability which it may have to
any other party other than for contribution hereunder. In case any such action, suit or Proceeding is brought against any party, and such party notifies a Contributing Party or its representative of the commencement thereof within the aforesaid
fifteen days, the Contributing Party will be entitled to participate therein with the notifying party and any other Contributing Party similarly notified. Any such Contributing Party shall not be liable to any party seeking contribution on account
of any settlement of any claim, action or Proceeding affected by such party seeking contribution without the written consent of such Contributing Party. The contribution provisions contained in this Section&nbsp;6.4 are intended to supersede, to the
extent permitted by law, any right to contribution under the Securities Act, the Exchange Act or otherwise available. </P> <P STYLE="margin-top:24pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>ARTICLE VII.
</B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>MISCELLANEOUS </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">7.1 <U>Termination</U>. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(a) <U>Termination Right</U>. The Representative shall have the right to terminate this Agreement at any time prior to any
Closing Date, (i)&nbsp;if any domestic or international event or act or occurrence has materially disrupted, or in its opinion will in the immediate future materially disrupt, general securities markets in the United States; or (ii)&nbsp;if trading
on any Trading Market shall have been suspended or materially limited, or minimum or maximum prices for trading shall have been fixed, or maximum ranges for prices for securities shall have been required by FINRA or by order of the Commission or any
other government authority having jurisdiction, or (iii)&nbsp;if the United States shall have become involved in a new war or an increase in major hostilities, or (iv)&nbsp;if a banking moratorium has been declared by a New York State or federal
authority, or (v)&nbsp;if a moratorium on foreign exchange trading has been declared which materially adversely impacts the United States securities markets, or (vi)&nbsp;if the Company shall have sustained a material loss by fire, flood, accident,
hurricane, earthquake, theft, sabotage or other calamity or malicious act, or (vii)&nbsp;if the Company is in material breach of any of its representations, warranties or covenants hereunder, </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">31 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">
or (viii)&nbsp;if the Representative shall have become aware after the date hereof of such a material adverse change in the conditions or prospects of the Company, in each case of
(i)&nbsp;through (vii)&nbsp;above, the effect of which, in the Representative&#146;s judgment, would make it impracticable to proceed with the offering, sale and/or delivery of the Securities or to enforce contracts made by the Underwriters for the
sale of the Securities. </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; text-indent:4%; font-size:10pt; font-family:Times New Roman">(b) <U>Indemnification</U>. Notwithstanding any contrary provision contained in this Agreement,
any election hereunder or any termination of this Agreement, and whether or not this Agreement is otherwise carried out, the provisions of Article VI shall not be in any way effected by such election or termination or failure to carry out the terms
of this Agreement or any part hereof. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">7.2 <U>Entire Agreement</U>. The Transaction Documents, together with the exhibits and schedules
thereto, the Preliminary Prospectus and the Prospectus, contain the entire understanding of the parties with respect to the subject matter hereof and thereof and supersede all prior agreements and understandings, oral or written, with respect to
such matters, which the parties acknowledge have been merged into such documents, exhibits and schedules. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">7.3 <U>Notices</U>. Any and all
notices or other communications or deliveries required or permitted to be provided hereunder shall be in writing and shall be deemed given and effective on the earliest of: (a)&nbsp;the date of transmission, if such notice or communication is
delivered via facsimile at the facsimile number set forth on the signature pages attached hereto at or prior to 5:30 p.m. (New York City time) on a Trading Day, (b)&nbsp;the next Trading Day after the date of transmission, if such notice or
communication is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (c)&nbsp;the second (2<SUP
STYLE="font-size:85%; vertical-align:top">nd</SUP>)&nbsp;Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service or (d)&nbsp;upon actual receipt by the party to whom such notice is required to be
given. The address for such notices and communications shall be as set forth on the signature pages attached hereto. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">7.4 <U>Amendments;
Waivers</U>. No provision of this Agreement may be waived, modified, supplemented or amended except in a written instrument signed, in the case of an amendment, by the Company and the Representative. No waiver of any default with respect to any
provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission
of any party to exercise any right hereunder in any manner impair the exercise of any such right. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">7.5 <U>Headings</U>. The headings
herein are for convenience only, do not constitute a part of this Agreement and shall not be deemed to limit or affect any of the provisions hereof. </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">32 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">7.6 <U>Successors and Assigns</U>. This Agreement shall be binding upon and inure to the benefit
of the parties and their successors and permitted assigns. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">7.7 <U>Governing Law</U>. All questions concerning the construction, validity,
enforcement and interpretation of the Transaction Documents shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts of law thereof. Each party
agrees that all legal proceedings concerning the interpretations, enforcement and defense of the transactions contemplated by this Agreement and any other Transaction Documents (whether brought against a party hereto or its respective affiliates,
directors, officers, shareholders, partners, members, employees or agents) shall be commenced exclusively in the state and federal courts sitting in the City of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the
state and federal courts sitting in the City of New York, Borough of Manhattan for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein (including with respect to the
enforcement of any of the Transaction Documents), and hereby irrevocably waives, and agrees not to assert in any action, suit or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or
proceeding is improper or is an inconvenient venue for such proceeding. Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof via
registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and
notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law. If either party shall commence an action or proceeding to enforce any provisions of the Transaction
Documents, then, in addition to the obligations of the Company under Article VI, the prevailing party in such action, suit or proceeding shall be reimbursed by the other party for its reasonable attorneys&#146; fees and other costs and expenses
incurred with the investigation, preparation and prosecution of such action or proceeding. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">7.8 <U>Survival</U>. The representations and
warranties contained herein shall survive the Closing and the delivery of the Securities. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">7.9 <U>Execution</U>. This Agreement may be
executed in two or more counterparts, all of which when taken together shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to each other party, it being understood
that the parties need not sign the same counterpart. In the event any signature is delivered by facsimile transmission or by e-mail delivery of a &#147;.pdf&#148; format data file, such signature shall create a valid and binding obligation of the
party executing (or on whose behalf such signature is executed) with the same force and effect as if such facsimile or &#147;.pdf&#148; signature page were an original thereof. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">7.10 <U>Severability</U>. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be
invalid, illegal, void or </P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">33 </P>


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unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated,
and the parties hereto shall use commercially reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such term, provision, covenant or restriction. It is hereby
stipulated and declared to be the intention of the parties that they would have executed the remaining terms, provisions, covenants and restrictions without including any of such that may be hereafter declared invalid, illegal, void or
unenforceable. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">7.11 <U>Remedies</U>. In addition to being entitled to exercise all rights provided herein or granted by law, including
recovery of damages, the Underwriters and the Company will be entitled to specific performance under the Transaction Documents. The parties agree that monetary damages may not be adequate compensation for any loss incurred by reason of any breach of
obligations contained in the Transaction Documents and hereby agree to waive and not to assert in any action for specific performance of any such obligation the defense that a remedy at law would be adequate. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">7.12 <U>Saturdays, Sundays, Holidays, etc</U>. If the last or appointed day for the taking of any action or the expiration of any right
required or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised on the next succeeding Business Day. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">7.13 <U>Construction</U>. The parties agree that each of them and/or their respective counsel have reviewed and had an opportunity to revise
the Transaction Documents and, therefore, the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of the Transaction Documents or any amendments
thereto. In addition, each and every reference to share prices and shares of Common Stock in any Transaction Document shall be subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar
transactions of the Common Stock that occur after the date of this Agreement. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">7.14 <B><U>WAIVER OF JURY TRIAL</U>. IN ANY ACTION, SUIT,
OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY, THE PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY
APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVE FOREVER ANY RIGHT TO TRIAL BY JURY.</B> </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><I>(Signature
Pages Follow) </I></P>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">34 </P>


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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">If the foregoing correctly sets forth the understanding between the Underwriters and the Company,
please so indicate in the space provided below for that purpose, whereupon this letter shall constitute a binding agreement among the Company and the several Underwriters in accordance with its terms. </P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><DIV ALIGN="right">
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<TR>
<TD WIDTH="6%"></TD>
<TD VALIGN="bottom" WIDTH="1%"></TD>
<TD WIDTH="12%"></TD>
<TD VALIGN="bottom" WIDTH="1%"></TD>
<TD WIDTH="80%"></TD></TR>


<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="5">Very truly yours,</TD></TR>
<TR>
<TD HEIGHT="16" COLSPAN="5"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="5"><B>STEMCELLS, INC.</B></TD></TR>
<TR>
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="4"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">By:</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="bottom" COLSPAN="3"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">/s/ Martin McGlynn</P></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">Name:</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="bottom">Martin McGlynn</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">Title:</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="bottom">President &amp; CEO</TD></TR>
</TABLE></DIV> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Address for Notice: </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">7707
Gateway Boulevard </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Suite 140 </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Newark, CA 94560 </P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="100%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" ALIGN="center">


<TR>
<TD WIDTH="6%"></TD>
<TD VALIGN="bottom" WIDTH="2%"></TD>
<TD WIDTH="92%"></TD></TR>


<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Copy&nbsp;to:</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom">Marko Zatylny</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom">Ropes &amp; Gray LLP</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom">Prudential Tower</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom">800 Boylston Street</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom">Boston, MA 02199</TD></TR>
</TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><I>[Underwriting
Agreement Signature Page] </I></P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Accepted on the date first above written: </P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="40%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt">


<TR>
<TD WIDTH="7%"></TD>
<TD VALIGN="bottom" WIDTH="1%"></TD>
<TD WIDTH="13%"></TD>
<TD VALIGN="bottom" WIDTH="1%"></TD>
<TD WIDTH="78%"></TD></TR>


<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="5"><B>CHARDAN CAPITAL MARKETS, LLC</B></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="5">As the Representative of the several Underwriters listed on Schedule I</TD></TR>
<TR>
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="4"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">By:</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="bottom" COLSPAN="3"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">/s/ Jonas Grossman</P></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">Name:</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="bottom">Jonas Grossman</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">Title:</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="bottom">Managing Partner</TD></TR>
</TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Address for Notice: </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Chardan
Capital Markets, LLC </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">17 State Street </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Suite 1600 </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">New York, NY 10004 </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="92%"></TD></TR>


<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Copy&nbsp;to:</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom">Pryor Cashman LLP</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom">7 Times Square</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom">New York, NY 10036</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom">Attn: M. Ali Panjwani</TD></TR>
</TABLE>
 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><I>[Underwriting
Agreement Signature Page] </I></P>


<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>SCHEDULE I </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">S<SMALL>CHEDULE</SMALL> <SMALL>OF</SMALL> U<SMALL>NDERWRITERS</SMALL> </P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="100%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" ALIGN="center">


<TR>
<TD WIDTH="65%"></TD>
<TD VALIGN="bottom" WIDTH="3%"></TD>
<TD></TD>
<TD></TD>
<TD></TD>
<TD VALIGN="bottom" WIDTH="3%"></TD>
<TD></TD>
<TD></TD>
<TD></TD>
<TD VALIGN="bottom" WIDTH="3%"></TD>
<TD></TD>
<TD></TD>
<TD></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:8pt">
<TD VALIGN="bottom" NOWRAP> <P STYLE="border-bottom:1.00pt solid #000000; width:42.15pt; font-size:8pt; font-family:Times New Roman">Underwriters</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" ALIGN="center" STYLE="border-bottom:1.00pt solid #000000">Closing&nbsp;Shares</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" ALIGN="center" STYLE="border-bottom:1.00pt solid #000000">Closing&nbsp;Warrants</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" COLSPAN="2" ALIGN="center" STYLE="border-bottom:1.00pt solid #000000">Closing&nbsp;Purchase&nbsp;Price</TD>
<TD VALIGN="bottom">&nbsp;</TD></TR>


<TR BGCOLOR="#cceeff" STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">Chardan Capital Markets, LLC</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">9,215,250</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">4,607,625</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">12,560,385.75</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">Maxim Group LLC</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">1,954,750</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">977,375</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">2,664,324.25</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
<TR STYLE="font-size:1px; ">
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE="border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE="border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE="border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE="border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE="border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD VALIGN="bottom"> <P STYLE="border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD>&nbsp;</TD></TR>
<TR BGCOLOR="#cceeff" STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em; font-size:10pt; font-family:Times New Roman">Total</P></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">11,170,000</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">5,585,000</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="bottom" ALIGN="right">15,224,710.00</TD>
<TD NOWRAP VALIGN="bottom">&nbsp;&nbsp;</TD></TR>
</TABLE>
</BODY></HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4.1
<SEQUENCE>3
<FILENAME>d608543dex41.htm
<DESCRIPTION>EX-4.1
<TEXT>
<HTML><HEAD>
<TITLE>EX-4.1</TITLE>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="right"><B>Exhibit 4.1 </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><U>Form of Warrant </U></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>STEMCELLS, INC. </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>WARRANT TO PURCHASE COMMON STOCK </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="right">Date of Issuance: October &nbsp;&nbsp;&nbsp;&nbsp;, 2013 </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="100%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" ALIGN="center">


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<TD WIDTH="37%"></TD>
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<TD WIDTH="25%"></TD>
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<TD WIDTH="34%"></TD></TR>


<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="center"><B>VOID&nbsp;AFTER&nbsp;October&nbsp;[</B><FONT STYLE="FONT-FAMILY:'WINGDINGS 2'">&#151;</FONT><B></B><B>],&nbsp;2018</B></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top"></TD></TR>
<TR STYLE="font-size:1px; ">
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"> <P STYLE="border-top:1.00px solid #000000">&nbsp;</P></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="bottom"></TD></TR>
</TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">THIS WARRANT TO PURCHASE COMMON STOCK (the &#147;<B>Warrant</B>&#148;) certifies that, for value
received,&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;, or permitted registered assigns (the &#147;<B>Holder</B>&#148;), is entitled, upon the terms and subject to the limitations on exercise and
the conditions hereinafter set forth, at any time on or after the Date of Issuance and on or prior to the close of business on the fifth anniversary of the Date of Issuance (the &#147;<B>Termination Date</B>&#148;) but not thereafter, to subscribe
for and purchase at the Exercise Price (defined below) from StemCells, Inc., a Delaware corporation (the &#147;<B>Company</B>&#148;), up to [&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;] shares of
the common stock of the Company, par value $0.01 per share (the &#147;<B>Common Stock</B>&#148;). This warrant is one of a series of warrants issued by the Company as of the date hereof (individually a &#147;<B>Warrant</B>&#148;; collectively,
&#147;<B>Company Warrants</B>&#148;). </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">1.&nbsp;<U>DEFINITIONS</U>.&nbsp;As used herein, the following terms shall have the following
meanings: </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(a)&nbsp;&#147;<B>Exercise Period</B>&#148; shall mean the period commencing with the date occurring immediately on the date
hereof and ending five years from the date hereof, unless sooner terminated as provided below. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(b)&nbsp;&#147;<B>Exercise Price</B>&#148;
shall mean $1.80 per share, subject to adjustment pursuant to <U>Section&nbsp;4</U> below. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(c)&nbsp;&#147;<B>Exercise Shares</B>&#148;
shall mean the shares of Common Stock issuable upon exercise of this Warrant. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(d)&nbsp;&#147;<B>Trading Day</B>&#148; shall mean
(i)&nbsp;any day on which the Common Stock is listed or quoted and traded on its primary Trading Market, (ii)&nbsp;if the Common Stock is not then listed or quoted and traded on any eligible market (meaning any of the NYSE, AMEX or NASDAQ), then a
day on which trading occurs on the OTC Bulletin Board (or any successor thereto), or (iii)&nbsp;if trading does not occur on the OTC Bulletin Board (or any successor thereto), any business day. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">2. <U>EXERCISE OF WARRANT</U>. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">2.1&nbsp;<U>STANDARD EXERCISE OF WARRANT</U>.&nbsp;The rights represented by this Warrant may be exercised in whole or in part at any time
during the Exercise Period, by delivery of the following to the Company at its address set forth on the signature page hereto (or at such other office or agent of the Company as it may designate by notice in writing to the Holder): </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(a)&nbsp;An executed Notice of Exercise in the form attached hereto; and </P>

<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(b)&nbsp;Payment of the Exercise Price either (i)&nbsp;in cash or by check (subject to the
limitations in <U>Section&nbsp;2.4</U> below), or (ii)&nbsp;pursuant to net exercise terms outlined under <U>Section&nbsp;2.2</U> below. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The Holder shall not be required to physically surrender this Warrant to the Company until the Holder has purchased all of the Exercise Shares
available hereunder and the Warrant has been exercised in full, in which case, the Holder shall surrender this Warrant to the Company for cancellation within three (3)&nbsp;Trading Days of the date the final Notice of Exercise is delivered to the
Company. Partial exercises of this Warrant resulting in purchases of a portion of the total number of Exercise Shares available hereunder shall have the effect of lowering the outstanding number of Exercise Shares purchasable hereunder in an amount
equal to the applicable number of Exercise Shares purchased. The Holder and the Company shall maintain records showing the number of Exercise Shares purchased and the date of such purchases.<B> The Holder and any assignee, by acceptance of this
Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the Exercise Shares hereunder, the number of Exercise Shares available for purchase hereunder at any given time may be less
than the amount stated on the face hereof.</B> </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Certificates for shares purchased hereunder shall be transmitted by the transfer agent of
the Company to the Holder by crediting the account of the Holder&#146;s prime broker with the Depository Trust Company through its Deposits and Withdrawal at Custodian (DWAC) system if the Company is a participant in such system, and otherwise by
physical delivery to the address specified by the Holder in the Notice of Exercise by the date that is three (3)&nbsp;Trading Days after the latest of (i)&nbsp;the delivery to the Company of the Notice of Exercise, (ii)&nbsp;surrender of this
Warrant and (iii)&nbsp;payment of the aggregate Exercise Price as set forth above (such date, the &#147;<B>Exercise Share Delivery Date</B>&#148;). This Warrant shall be deemed to have been exercised on the date the Exercise Price is received by the
Company. The Exercise Shares shall be deemed to have been issued, and Holder or any other person so designated to be named therein shall be deemed to have become a holder of record of such shares for all purposes, as of the date this Warrant has
been exercised by payment to the Company of the Exercise Price. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Notwithstanding the foregoing, the Company shall not be required to make
the payments set forth herein in the case of uncertificated Exercise Shares if the Holder fails to timely file a request with the depository trust company to receive such uncertificated Exercise Shares. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The person in whose name any certificate or certificates for Exercise Shares are to be issued upon exercise of this Warrant shall be deemed to
have become the holder of record of such shares on the date on which this Warrant was surrendered and payment of the Exercise Price was made, irrespective of the date of delivery of such certificate or certificates, except that, if the date of such
surrender and payment is a date when the stock transfer books of the Company are closed, such person shall be deemed to have become the holder of such shares at the close of business on the next succeeding date on which the stock transfer books are
open. </P>

<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Notwithstanding the foregoing, if the Company fails to cause the transfer agent to transmit to
the Holder a certificate or the certificates representing the Exercise Shares pursuant to an exercise on or before the Exercise Share Delivery Date, then the Holder will have the right to rescind such Notice of Exercise. Nothing herein shall limit a
Holder&#146;s right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company&#146;s failure to timely deliver a
certificate pursuant to the terms hereof. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">2.2&nbsp;<U>NET EXERCISE</U>.&nbsp;If during the Exercise Period, the issuance of the Exercise
Shares to the Holder is not covered by the registration statement on Form S-3 (File No.&nbsp;33-170300) or any other effective registration statement under the Securities Act of 1933, as amended, and the fair market value of one share of the Common
Stock is greater than the Exercise Price (at the date of calculation as set forth below), the Company shall be permitted to satisfy its obligation to issue the shares to be issued on exercise of this Warrant by issuing to the Holder, and the Holder
shall be permitted to exercise all or part of this Warrant by electing to receive, shares equal to the value (as determined below) of this Warrant (or the portion thereof being canceled), in lieu of paying the Exercise Price in immediately available
funds. Upon delivery of a properly endorsed Notice of Exercise, the Company shall issue to the Holder a number of shares of Common Stock computed using the following formula: </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">X = <U>Y (A&#150;B)</U> </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><U></U>&nbsp;&nbsp;&nbsp;&nbsp;A </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="84%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" ALIGN="center">


<TR>
<TD WIDTH="8%"></TD>
<TD VALIGN="bottom" WIDTH="1%"></TD>
<TD WIDTH="91%"></TD></TR>


<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" ALIGN="right">Where&nbsp;X&nbsp;=</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="bottom">the number of shares of Common Stock to be issued to the Holder</TD></TR>
<TR>
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" ALIGN="right">Y =</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="bottom">the number of shares of Common Stock for which the Warrant is then being exercised</TD></TR>
<TR>
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom" ALIGN="right">A =</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="bottom">the fair market value of one share of the Company&#146;s Common Stock (at the date of such calculation)</TD></TR>
<TR>
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom" ALIGN="right">B =</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="bottom">Exercise Price in effect at the time of exercise</TD></TR>
</TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">For purposes of the above calculation, the &#147;fair market value&#148; of one share of Common Stock shall
mean (i)&nbsp;the average of the closing sales prices for the shares of Common Stock on the NASDAQ Capital Market or other trading market where such security is listed or traded as reported by Bloomberg Financial Markets (or a comparable reporting
service of national reputation selected by the Company and reasonably acceptable to the Holder if Bloomberg Financial Markets is not then reporting sales prices of such security) (collectively, &#147;<B>Bloomberg</B>&#148;) for the ten
(10)&nbsp;consecutive trading days immediately preceding such date, or (ii)&nbsp;if the NASDAQ Capital Market is not the principal trading market for the shares of Common Stock, the average of the reported sales prices reported by Bloomberg on the
principal trading market for the Common Stock during the same period, or, if there is no sales price for such period, the last sales price reported by Bloomberg for such period, or (iii)&nbsp;if neither of the
</P>

<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
foregoing applies, the last sales price of such security in the over-the-counter market on the pink sheets or bulletin board for such security as reported by Bloomberg, or if no sales price is so
reported for such security, the last bid price of such security as reported by Bloomberg or (iv)&nbsp;if fair market value cannot be calculated as of such date on any of the foregoing bases, the fair market value shall be as determined by the Board
of Directors of the Company in the exercise of its good faith judgment. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">2.3&nbsp;<U>ISSUANCE OF NEW WARRANTS</U>.&nbsp;Upon any partial
exercise of this Warrant, the Company, at its expense, will forthwith and, in any event within five Trading Days, issue and deliver to the Holder a new warrant or warrants of like tenor, registered in the name of the Holder, exercisable, in the
aggregate, for the balance of the number of shares of Common Stock remaining available for purchase under this Warrant. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">2.4&nbsp;<U>EXERCISE LIMITATIONS; HOLDER&#146;S RESTRICTIONS</U>.&nbsp;A Holder shall not have the right to exercise any portion of this
Warrant, pursuant to <U>Section&nbsp;2</U> or otherwise, to the extent that after giving effect to such issuance after exercise, such Holder (together with such Holder&#146;s affiliates) would beneficially own in excess of 4.99% of the number of
shares of the Common Stock outstanding immediately after giving effect to such issuance. For purposes of the foregoing sentence, the number of shares of Common Stock beneficially owned by such Holder and its affiliates shall include the number of
shares of Common Stock issuable upon exercise of this Warrant with respect to which the determination of such sentence is being made, but shall exclude the number of shares of Common Stock which would be issuable upon (A)&nbsp;exercise of the
remaining, nonexercised portion of this Warrant beneficially owned by such Holder or any of its affiliates and (B)&nbsp;exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including, without
limitation, any other shares of Common Stock or Warrants) subject to a limitation on conversion or exercise analogous to the limitation contained herein beneficially owned by such Holder or any of its affiliates. Except as set forth in the preceding
sentence, for purposes of this <U>Section&nbsp;2.4</U>, beneficial ownership shall be calculated in accordance with Section&nbsp;13(d) of the Exchange Act, it being acknowledged by a Holder that the Company is not representing to such Holder that
such calculation is in compliance with Section&nbsp;13(d) of the Exchange Act and such Holder is solely responsible for any schedules or other filings required to be filed under the Exchange Act. To the extent that the limitation contained in this
<U>Section&nbsp;2.4</U> applies, the determination of whether this Warrant is exercisable (in relation to other securities owned by such Holder) and of which a portion of this Warrant is exercisable shall be in the sole discretion of a Holder, and
the submission of a Notice of Exercise shall be deemed to be each Holder&#146;s determination of whether this Warrant is exercisable (in relation to other securities owned by such Holder) and of which portion of this Warrant is exercisable, in each
case subject to such aggregate percentage limitation, and the Company shall be entitled to rely on the Holder&#146;s determination and shall have no obligation to verify or confirm the accuracy of such determination. For purposes of this
<U>Section&nbsp;2.4</U>, in determining the number of outstanding shares of Common Stock, a Holder may rely on the number of outstanding shares of Common Stock as reflected in (x)&nbsp;the Company&#146;s most recent Form 10-Q or Form 10-K, as the
case may be, (y)&nbsp;a more recent public announcement by the Company or (z)&nbsp;any other notice by the Company or the Company&#146;s Transfer Agent setting forth the number of shares of Common Stock outstanding. Upon the written or oral request
of a Holder, the Company shall within two Trading Days confirm orally and in writing to such Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common
</P>

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Stock shall be determined after giving effect to the conversion or exercise of securities of the Company, including this Warrant, by such Holder or its affiliates since the date as of which such
number of outstanding shares of Common Stock was reported. The provisions of this <U>Section&nbsp;2.4</U> may be waived by such Holder, at the election of such Holder, upon not less than 61 days&#146; prior notice to the Company, and the provisions
of this <U>Section&nbsp;2.4</U> shall continue to apply until such 61st day (or such later date, as determined by such Holder, as may be specified in such notice of waiver). </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">3. <U>COVENANTS OF THE COMPANY</U>. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">3.1&nbsp;<U>COVENANTS AS TO EXERCISE SHARES</U>.&nbsp;The Company covenants and agrees that all Exercise Shares that may be issued upon the
exercise of the rights represented by this Warrant will, upon issuance, be validly issued and outstanding, fully paid and nonassessable, and free from all taxes, liens and charges with respect to the issuance thereof. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The Company further covenants and agrees that the Company will at all times during the Exercise Period, have authorized and reserved, free
from preemptive rights, a sufficient number of shares of Common Stock to provide for the exercise of the rights represented by this Warrant. If at any time during the Exercise Period the number of authorized but unissued shares of Common Stock shall
not be sufficient to permit exercise of this Warrant, the Company will take such corporate action as may, in the opinion of its counsel, be necessary to increase its authorized but unissued shares of Common Stock to such number of shares as shall be
sufficient for such purposes. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">3.2 <U>NO IMPAIRMENT</U>.&nbsp;The Company will not, by amendment of its Certificate of Incorporation or
through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed
hereunder by the Company, and will at all times in good faith assist in the carrying out of all the provisions of this Warrant and in the taking of all such action as may be necessary or appropriate in order to protect the exercise rights of the
Holder against impairment. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">3.3 <U>NOTICES OF RECORD DATE AND CERTAIN OTHER EVENTS</U>. In the event of any taking by the Company of a
record of the holders of any class of securities for the purpose of determining the holders thereof who are entitled to receive any dividend or other distribution, the Company shall provide to the Holder, at least ten (10)&nbsp;days prior to the
date on which any such record is to be taken for the purpose of such dividend or distribution, a notice specifying such date. In the event of any voluntary dissolution, liquidation or winding up of the Company, the Company shall provide to the
Holder, at least ten (10)&nbsp;days prior to the date of the occurrence of any such event, a notice specifying such date. In the event the Company authorizes or approves, enters into any agreement contemplating, or solicits stockholder approval for
any Fundamental Transaction, as defined in Section&nbsp;6 herein, the Company shall provide to the Holder, at least ten (10)&nbsp;days prior to the date of the occurrence of such Fundamental Transaction, a notice specifying such date.
Notwithstanding the foregoing, the failure to deliver such notice or any defect therein shall not affect the validity of the corporate action required to be described in such notice. </P>

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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">4. <U>ADJUSTMENT OF EXERCISE PRICE AND EXERCISE SHARES</U>. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(a)&nbsp;If the Company, at any time while this Warrant is outstanding, (i)&nbsp;pays a stock dividend on its Common Stock or otherwise makes
a distribution on any class of capital stock that is payable in shares of Common Stock, (ii)&nbsp;subdivides outstanding shares of Common Stock into a larger number of shares, or (iii)&nbsp;combines outstanding shares of Common Stock into a smaller
number of shares, then in each such case the Exercise Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock outstanding immediately before such event and of which the denominator shall be the
number of shares of Common Stock outstanding immediately after such event. Any adjustment made pursuant to clause (i)&nbsp;of this paragraph shall become effective immediately after the record date for the determination of stockholders entitled to
receive such dividend or distribution, and any adjustment pursuant to clause (ii)&nbsp;or (iii)&nbsp;of this paragraph shall become effective immediately after the effective date of such subdivision or combination. The form of this Warrant need not
be changed because of any adjustment in the number of Exercise Shares subject to this Warrant. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(b)&nbsp;If the Company, at any time while
this Warrant is outstanding, distributes to holders of Common Stock, (i)&nbsp;Common Stock or any shares of stock or other securities which are at any time directly or indirectly convertible into or exchangeable for Common Stock, or any rights or
options to subscribe for, purchase or otherwise acquire any of the foregoing by way of dividend or other distribution (other than a dividend or distribution covered in <U>Section&nbsp;4(a)</U> above); (ii)&nbsp;any cash paid or payable otherwise
than as a cash dividend; or (iii)&nbsp;any other asset, then and in each such case, the Holder hereof will, upon the exercise of this Warrant, be entitled to receive, in addition to the number of shares of Common Stock receivable thereupon, and
without payment of any additional consideration therefor, the amount of stock and other securities and property (including cash in the cases referred to in clauses (ii)&nbsp;and (iii)&nbsp;above) which such Holder would hold on the date of such
exercise had such Holder been the holder of record of such Common Stock as of the date on which holders of Common Stock received or became entitled to receive such shares or all other additional stock and other securities and property. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">(c)&nbsp;Upon the occurrence of each adjustment pursuant to this <U>Section&nbsp;4</U>, the Company at its expense will, at the written
request of the Holder, promptly compute such adjustment in accordance with the terms of this Warrant and prepare a certificate setting forth such adjustment, including a statement of the adjusted Exercise Price and adjusted number or type of
Exercise Shares or other securities issuable upon exercise of this Warrant (as applicable), describing the transactions giving rise to such adjustments and showing in detail the facts upon which such adjustment is based. Upon written request, the
Company will promptly deliver a copy of each such certificate to the Holder and to the Company&#146;s transfer agent. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">5. <U>FRACTIONAL
SHARES</U>.&nbsp;No fractional shares shall be issued upon the exercise of this Warrant as a consequence of any adjustment pursuant hereto. All Exercise Shares (including fractions) issuable upon exercise of this Warrant may be aggregated for
purposes of determining whether the exercise would result in the issuance of any fractional share. If, after aggregation, the exercise would result in the issuance of a fractional share, the Company shall, in lieu of issuance of any fractional
share, pay the Holder otherwise entitled to such fraction a sum in cash equal to the product resulting from multiplying the then current fair market value of an Exercise Share by such fraction. </P>

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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">6. <U>FUNDAMENTAL TRANSACTIONS</U>.&nbsp;If, at any time while this Warrant is outstanding,
(i)&nbsp;the Company effects any merger or consolidation of the Company with or into another entity, in which the shareholders of the Company as of immediately prior to the transaction own less than a majority of the outstanding stock of the
surviving entity, (ii)&nbsp;any tender offer or exchange offer (whether by the Company or another person or entity) is completed pursuant to which the holders of more than the 50% of the outstanding shares of Common Stock (not including any shares
of Common Stock held by the person or persons making or party to, or associated or affiliated with the Persons making or party to, such purchase, tender or exchange offer) are permitted to tender or exchange their shares for other securities, cash
or property, or (iii)&nbsp;the Company effects any sale of all or substantially all of its assets in one or a series of related transactions, or (iv)&nbsp;the Company effects any reclassification of the Common Stock or any compulsory share exchange
pursuant to which the Common Stock is effectively converted into or exchanged for other securities, cash or property (other than as a result of a subdivision or combination of shares of Common Stock covered by <U>Section&nbsp;4</U> above),
(v)&nbsp;the Company consummates a stock purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with another person whereby such other person acquires
more than the 50% of the outstanding shares of Common Stock (not including any shares of Common Stock held by the other person or other persons making or party to, or associated or affiliated with the other persons making or party to, such stock
purchase agreement or other business combination), or (vi)&nbsp;any &#147;person&#148; or &#147;group&#148; (as these terms are used for purposes of Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended) becomes the
&#147;beneficial owner&#148; (as defined in Rule 13d-3 under the Securities Exchange Act of 1934, as amended), directly or indirectly, of 50% of the aggregate ordinary voting power represented by issued and outstanding Common Stock (each, a
&#147;<B>Fundamental Transaction</B>&#148;), the Holder shall have the right thereafter to receive, upon exercise of this Warrant, the same amount and kind of securities, cash or property as it would have been entitled to receive upon the occurrence
of such Fundamental Transaction if it had been, immediately prior to such Fundamental Transaction, the holder of the number of Exercise Shares then issuable upon exercise in full of this Warrant (the &#147;<B>Alternate Consideration</B>&#148;). To
the extent necessary to effectuate the foregoing provisions, any successor to the Company or surviving entity in such Fundamental Transaction shall issue to the Holder a new warrant consistent with the foregoing provisions and evidencing the
Holder&#146;s right to exercise such warrant into Alternate Consideration. The terms of any agreement pursuant to which a Fundamental Transaction is effected shall include terms requiring any such successor or surviving entity to comply with the
provisions of this <U>Section&nbsp;6</U> and ensuring that this Warrant (or any such replacement security) will be similarly adjusted upon any subsequent transaction analogous to a Fundamental Transaction. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">7. <U>NO STOCKHOLDER RIGHTS</U>.&nbsp;Other than as provided in <U>Section&nbsp;3.3</U> or otherwise herein, the Holder, solely in such
Holder&#146;s capacity as a holder of this Warrant, shall not be entitled to vote or receive dividends or be deemed the holder of share capital of the Company for any purpose, nor shall anything contained in this Warrant be construed to confer upon
the Holder, solely in such Holder&#146;s capacity as the Holder of this Warrant, any of the rights of a stockholder of the Company or any right to vote, give or withhold consent to any corporate action (whether
</P>

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any reorganization, issue of stock, reclassification of stock, consolidation, merger, conveyance or otherwise), receive notice of meetings, receive dividends or subscription rights, or otherwise,
prior to the issuance to the Holder of the Exercise Shares which such Holder is then entitled to receive upon the due exercise of this Warrant. In addition, nothing contained in this Warrant shall be construed as imposing any liabilities on the
Holder to purchase any securities (upon exercise of this Warrant or otherwise) or as a stockholder of the Company, whether such liabilities are asserted by the Company or by creditors of the Company. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">8. <U>TRANSFER OF WARRANT</U>.&nbsp;Subject to compliance with any applicable laws, this Warrant and all rights hereunder are transferable, by
the Holder in person or by duly authorized attorney, upon delivery of this Warrant and the form of assignment attached hereto to any transferee designated by Holder. If this Warrant is to be transferred, the Holder shall surrender this Warrant to
the Company or its designated agent, whereupon the Company or its agent, as applicable, will forthwith issue and deliver upon the order of the Holder a new Warrant (in accordance with Section&nbsp;2.3), registered as the Holder may request,
representing the right to purchase the number of Exercise Shares being transferred by the Holder and, if less then the total number of Exercise Shares then underlying this Warrant is being transferred, a new Warrant (in accordance with
Section&nbsp;2.3) to the Holder representing the right to purchase the number of Exercise Shares not being transferred. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">9. <U>LOST,
STOLEN, MUTILATED OR DESTROYED WARRANT</U>.&nbsp;If this Warrant is lost, stolen, mutilated or destroyed, the Company may, on such terms as to reasonable bond and indemnity or otherwise as it may reasonably impose (which shall, in the case of a
mutilated Warrant, include the surrender thereof), issue a new Warrant of like denomination and tenor as this Warrant so lost, stolen, mutilated or destroyed. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">10. <U>DISPUTE</U>. In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the Exercise
Shares, the Company shall promptly issue to the Holder the number of Exercise Shares that are not disputed and resolve such dispute in accordance with this <U>Section&nbsp;10</U>. In the case of a dispute as to the determination of the Exercise
Price or the arithmetic calculation of the Exercise Shares, the Company shall provide notice to the Holder of the disputed determinations or arithmetic calculations within two Trading Days of receipt of the Notice of Exercise giving rise to such
dispute, as the case may be. If the Holder and the Company are unable to agree upon such determination or calculation of the Exercise Price or the Exercise Shares within three Trading Days of such disputed determination or arithmetic calculation
being submitted to the Holder, then the Company shall, within two Trading Days, submit (a)&nbsp;the disputed determination of the Exercise Price to an independent, reputable investment bank selected by the Company and approved by the Holder or
(b)&nbsp;the disputed arithmetic calculation of the Exercise Shares to the Company&#146;s independent, outside accountant. The Company shall cause at its expense the investment bank or the accountant, as the case may be, to perform the
determinations or calculations and notify the Company and the Holder of the results no later than ten Trading Days from the time it receives the disputed determinations or calculations. Such investment bank&#146;s or accountant&#146;s determination
or calculation, as the case may be, shall be binding upon all parties absent demonstrable error. </P>

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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">11. <U>NOTICES, ETC</U>.&nbsp;All notices required or permitted hereunder shall be in writing and
shall be deemed effectively given: (a)&nbsp;upon personal delivery to the party to be notified, (b)&nbsp;when sent by confirmed telex or facsimile if sent during normal business hours of the recipient, if not, then on the next Trading Day,
(c)&nbsp;five days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (d)&nbsp;one day after deposit with a nationally recognized overnight courier, specifying next day delivery, with written
verification of receipt. All communications shall be sent to the Company at the address listed on the signature page hereto and to Holder at the address appearing on the books of the Company or at such other address as the Company or Holder may
designate by ten (10)&nbsp;days advance written notice to the other parties hereto. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">12. <U>ACCEPTANCE</U>.&nbsp;Receipt of this Warrant
by the Holder shall constitute acceptance of and agreement to all of the terms and conditions contained herein. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">13. <U>GOVERNING LAW;
WAIVER OF JURY TRIAL</U>.&nbsp;This Warrant shall be governed by, and construed in accordance with, the laws of the State of New York. The Holder and the Company hereby submit to the non-exclusive jurisdiction of the Federal and state courts in the
Borough of Manhattan in The City of New York in any suit or proceeding arising out of or relating to this Agreement or the transactions contemplated thereby. The Holder and the Company irrevocably and unconditionally waive any objection to the
laying of venue of any suit or proceeding arising out of or relating to this Warrant in Federal and state courts in the Borough of Manhattan in The City of New York and irrevocably and unconditionally waives and agrees not to plead or claim in any
such court that any such suit or proceeding in any such court has been brought in an inconvenient forum. EACH OF THE COMPANY AND THE HOLDER HEREBY WAIVES ALL RIGHTS TO A TRIAL BY JURY. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">14. <U>AMENDMENT OR WAIVER</U>.&nbsp;Any term of this Warrant may be amended or waived (either generally or in a particular instance and
either retroactively or prospectively) with the written consent of the Company and the Holder. The Company shall give prompt written notice to the Holder of any amendment hereof or waiver hereunder that was effected without the Holder&#146;s written
consent. No waivers of any term, condition or provision of this Warrant, in any one or more instances, shall be deemed to be, or construed as, a further or continuing waiver of any such term, condition or provision. </P>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:8%; font-size:10pt; font-family:Times New Roman">IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its duly authorized
officer as of &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;, 2013. </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><DIV ALIGN="right">
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<TD VALIGN="top" COLSPAN="3"><B>STEMCELLS, INC.</B></TD></TR>
<TR>
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">By:</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">&nbsp;</P></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">Name:</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top">Title:</TD></TR>
<TR>
<TD HEIGHT="16" COLSPAN="3"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3"> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">7707 Gateway Blvd</P> <P STYLE="margin-top:0pt; margin-bottom:1pt; font-size:10pt; font-family:Times New Roman">Newark, CA
94560</P></TD></TR>
</TABLE></DIV>

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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>NOTICE OF EXERCISE </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">TO: <B>STEMCELLS, INC. </B> </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; font-size:10pt; font-family:Times New Roman">(1) The undersigned
hereby elects to purchase Warrant Shares of the Company pursuant to the terms of the attached Warrant (only if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any. By
executing this notice, the undersigned Holder represents that it has complied with the Holder&#146;s Exercise Limitations set forth in Section&nbsp;2.4 of this Warrant. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:8%; font-size:10pt; font-family:Times New Roman">(2) Payment shall take the form of (check applicable box): </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:13%; font-size:10pt; font-family:Times New Roman"><FONT STYLE="FONT-FAMILY:WINGDINGS">&#168;</FONT> in lawful money of the United States; or </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:13%; font-size:10pt; font-family:Times New Roman"><FONT STYLE="FONT-FAMILY:WINGDINGS">&#168;</FONT> if permitted the cancellation of such number of Warrant Shares as is necessary, in
accordance with the formula set forth in subsection 2.2, to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure set forth in subsection 2.2. </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">(3) Please issue a certificate or certificates representing said Warrant Shares in the name of the undersigned or in such other name as is
specified below: </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><center> <P STYLE="line-height:6.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1.00pt solid #000000;width:26%">&nbsp;</P></center>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The Warrant Shares shall be delivered to the following DWAC Account Number or by physical delivery of a certificate to: </P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">&nbsp;</P></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">&nbsp;</P></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">&nbsp;</P></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">&nbsp;</P></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom"></TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom"></TD></TR>
</TABLE> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD VALIGN="top" COLSPAN="3">[SIGNATURE OF HOLDER]</TD></TR>
<TR>
<TD HEIGHT="16" COLSPAN="3"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3">Name of Investing Entity:</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">&nbsp;</P></TD></TR>
<TR>
<TD HEIGHT="16" COLSPAN="3"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3"><I>Signature of Authorized Signatory of Investing Entity:</I></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">&nbsp;</P></TD></TR>
<TR>
<TD HEIGHT="16" COLSPAN="3"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3">Name of Authorized Signatory:</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">&nbsp;</P></TD></TR>
<TR>
<TD HEIGHT="16" COLSPAN="3"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3">Title of Authorized Signatory:</TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" COLSPAN="3"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">&nbsp;</P></TD></TR>
<TR>
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Date:</TD>
<TD VALIGN="bottom"><FONT STYLE="font-size:8pt">&nbsp;</FONT></TD>
<TD VALIGN="top"> <P STYLE="margin-top:0pt; margin-bottom:1pt; border-bottom:1px solid #000000; font-size:10pt; font-family:Times New Roman">&nbsp;</P></TD></TR>
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<DOCUMENT>
<TYPE>EX-5.1
<SEQUENCE>4
<FILENAME>d608543dex51.htm
<DESCRIPTION>EX-5.1
<TEXT>
<HTML><HEAD>
<TITLE>EX-5.1</TITLE>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="right">Exhibit 5.1 </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">October&nbsp;2, 2013 </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">StemCells, Inc. </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">7707 Gateway Blvd, Suite 140 </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Newark, California 94560 </P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%" VALIGN="top" ALIGN="left">Re:</TD>
<TD ALIGN="left" VALIGN="top">Registration Statement on Form S-3 (File No.&nbsp;333-170300) </TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Ladies and Gentlemen: </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We have acted as counsel to StemCells, Inc., a Delaware corporation (the &#147;<U>Company</U>&#148;), in connection with issuance and sale of
up to 12,845,500 shares (the &#147;<U>Shares</U>&#148;) of common stock, $0.01 par value (the &#147;<U>Common Stock</U>&#148;), and warrants (the &#147;<U>Warrants</U>&#148;) to purchase up to 6,422,750 shares of Common Stock (the &#147;<U>Warrant
Shares</U>&#148;), pursuant to the above-referenced registration statement (as amended through the date hereof, the &#147;<U>Registration Statement</U>&#148;), filed by the Company with the Securities and Exchange Commission (the
&#147;<U>Commission</U>&#148;) under the Securities Act of 1933 (the &#147;<U>Securities Act</U>&#148;). </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">In connection with this opinion
letter, we have examined such certificates, documents and records and have made such investigation of fact and such examination of law as we have deemed appropriate in order to enable us to render the opinions set forth herein. In conducting such
investigation, we have relied, without independent verification, upon certificates of officers of the Company, public officials and other appropriate persons. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">The opinions expressed below are limited to the Delaware General Corporation Law. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Based upon and subject to the foregoing and the assumptions, qualifications and limitations set forth below, we are of the opinion that,
(i)&nbsp;the Shares have been duly authorized by the Company and, when issued and delivered to the purchasers thereof against payment of the purchase price therefor, will be validly issued, fully paid and non-assessable, (ii)&nbsp;assuming that
there is a sufficient number of authorized and unissued shares of Common Stock at the time of a Warrant exercise, the Warrant Shares, when issued and delivered against payment therefor upon the exercise of the Warrants in accordance with the terms
therein, will be duly authorized, validly issued, fully paid and nonassessable, and (iii)&nbsp;when the Warrants have been duly executed and delivered to the purchasers thereof against payment of the purchase price therefor, the Warrants will
constitute valid and binding obligations of the Company, enforceable against the Company in accordance with their terms. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">Our opinions set
forth above are subject to (a)&nbsp;bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and similar laws affecting the rights and remedies of creditors generally and (b)&nbsp;general principles of equity. Our opinions are also
subject to the qualification that the enforceability of provisions for indemnification or contribution, broadly worded waivers, waivers of rights to damages or defenses, waivers of unknown or future claims, and waivers of statutory, regulatory or
constitutional rights may be limited on public policy or statutory grounds. </P>

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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">StemCells, Inc. </P> <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P>
 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
In addition, we express no opinion as to the enforceability of any provision for choice of law or requiring that any action be brought only in the courts of a particular jurisdiction, or the
enforceability of any provision awarding attorney&#146;s fees. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:4%; font-size:10pt; font-family:Times New Roman">We hereby consent to your filing this opinion as an exhibit to the
Registration Statement and to the use of our name therein and in the related prospectus under the caption &#147;Validity of Securities.&#148; In giving such consent, we do not thereby admit that we are in the category of persons whose consent is
required under Sections&nbsp;7 of the Securities Act or the rules and regulations of the Commission thereunder. </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="40%" BORDER="0" STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt">


<TR>
<TD WIDTH="100%"></TD></TR>


<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Very truly yours,</TD></TR>
<TR>
<TD HEIGHT="16"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">/s/ Ropes&nbsp;&amp; Gray LLP</TD></TR>
<TR>
<TD HEIGHT="16"></TD></TR>
<TR STYLE="font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Ropes&nbsp;&amp; Gray LLP</TD></TR>
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</TEXT>
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<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>5
<FILENAME>d608543dex991.htm
<DESCRIPTION>EX-99.1
<TEXT>
<HTML><HEAD>
<TITLE>EX-99.1</TITLE>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="right"><B>Exhibit 99.1 </B></P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<P STYLE="margin-top:0pt;margin-bottom:0pt">


<IMG SRC="g608543ex992_pg001.jpg" ALT="LOGO">
 </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>STEMCELLS, INC. ANNOUNCES PROPOSED PUBLIC OFFERING OF COMMON STOCK AND WARRANTS </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>NEWARK, Calif., (October 1, 2013)</B> &#150; StemCells, Inc. (NASDAQ: STEM) today announced that it intends to offer and sell common stock and warrants,
subject to market and other conditions, in an underwritten public offering. The shares and warrants are being offered under the Company&#146;s effective shelf registration statement previously filed with the Securities and Exchange Commission (SEC).
StemCells intends to use the net proceeds of the offering for general corporate purposes, including working capital and operational purposes, including product development. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Chardan Capital Markets is acting as sole bookrunner for the offering and Maxim Group LLC is acting as co-manager on the deal. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The securities will be offered by means of a prospectus supplement and accompanying prospectus, forming a part of the effective registration statement, a copy
of which may be obtained, when available, at the website of the SEC at http://www.sec.gov. Electronic copies of the preliminary prospectus also may be obtained from Chardan Capital Markets, LLC Capital Markets, 17 State Street, Suite 1600, New York,
NY 10004, at 646-465-9012. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">This press release shall not constitute an offer to sell or the solicitation of an offer to buy these securities, nor shall
there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such jurisdiction. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>About StemCells, Inc. </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">StemCells, Inc. is engaged in the
research, development, and commercialization of cell-based therapeutics and tools for use in stem cell-based research and drug discovery. The Company&#146;s lead therapeutic product candidate,
HuCNS-SC<SUP STYLE="font-size:85%; vertical-align:top">&reg;</SUP> cells (purified human neural stem cells), is currently in development as a potential treatment for a broad range of central nervous system disorders. In a Phase&nbsp;I clinical trial
in Pelizaeus-Merzbacher disease (PMD), a fatal myelination disorder in children, the Company has shown preliminary evidence of progressive and durable donor-derived myelination in all four patients transplanted with HuCNS-SC cells. The Company is
conducting a Phase I/II clinical trial in chronic spinal cord injury in Switzerland, Canada and the United States, and has reported positive interim data for the first three patients. The Company is also conducting a Phase I/II clinical trial in dry
age-related macular degeneration (AMD) in the United States. In addition, the Company is pursuing </P>

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<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
preclinical studies in Alzheimer&#146;s disease, with support from the California Institute for Regenerative Medicine (CIRM). StemCells also markets stem cell research products, including media
and reagents, under the SC Proven<SUP STYLE="font-size:85%; vertical-align:top">&reg;</SUP> brand. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><I>Apart from statements of historical fact, the text
of this press release constitutes forward-looking statements within the meaning of the U.S. securities laws, and is subject to the safe harbors created therein. These statements include, but are not limited to, statements regarding the future
business operations of StemCells, Inc. (the &#147;Company&#148;); the Company&#146;s intention and ability to complete the offering and the expected use of net proceeds; the prospect for continued clinical development of the Company&#146;s HuCNS-SC
cells in CNS disorders; the timing of patient dosing and possible outcomes of the Company&#146;s Phase&nbsp;I/II clinical studies in spinal cord injury and age-related macular degeneration (AMD). These forward-looking statements speak only as of the
date of this news release. The Company does not undertake to update any of these forward-looking statements to reflect events or circumstances that occur after the date hereof. Such statements reflect management&#146;s current views and are based on
certain assumptions that may or may not ultimately prove valid. The Company&#146;s actual results may vary materially from those contemplated in such forward-looking statements due to risks and uncertainties to which the Company is subject,
including the fact that additional trials will be required to demonstrate the safety and efficacy of the Company&#146;s HuCNS-SC cells for the treatment of any disease or disorder; uncertainty as to whether the FDA or other applicable regulatory
agencies will permit the Company to continue clinical testing in spinal cord injury or AMD or in future clinical trials of proposed therapies for other diseases or conditions; uncertainties regarding the ability of preclinical research, including
research in animal models, to accurately predict success or failure in clinical trials; uncertainties regarding the Company&#146;s ability to recruit the patients required to conduct its clinical trials or to obtain meaningful results; uncertainties
regarding the Company&#146;s ability to obtain the increased capital resources needed to continue its current and planned research and development operations; uncertainty as to whether HuCNS-SC cells and any products that may be generated in the
future in the Company&#146;s cell-based programs will prove safe and clinically effective and not cause tumors or other adverse side effects; uncertainties regarding the Company&#146;s ability to commercialize a therapeutic product and its ability
to successfully compete with other products on the market; and other factors that are described under the heading &#147;Risk Factors&#148; in the Company&#146;s Annual Report on Form 10-K for the year ended December&nbsp;31, 2012, and in its
subsequent reports on Form 10-Q and Form 8-K. </I></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">CONTACT: </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Rodney Young </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">StemCells, Inc. </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Chief Financial Officer </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">(510) 456-4128 </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Ian Stone </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Russo Partners </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">(619) 308-6541 </P>
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<DOCUMENT>
<TYPE>EX-99.2
<SEQUENCE>6
<FILENAME>d608543dex992.htm
<DESCRIPTION>EX-99.2
<TEXT>
<HTML><HEAD>
<TITLE>EX-99.2</TITLE>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="right"><B>Exhibit 99.2 </B></P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<P STYLE="margin-top:0pt;margin-bottom:0pt">


<IMG SRC="g608543ex992_pg001.jpg" ALT="LOGO">
 </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>STEMCELLS, INC. ANNOUNCES PRICING OF PUBLIC OFFERING TO RAISE $16.2 MILLION </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>NEWARK, Calif., (October 2, 2013)</B> &#150; StemCells, Inc. (NASDAQ: STEM) today announced the pricing of an underwritten public offering of an aggregate
of 11,170,000 units at a public offering price of $1.45 per unit. Each unit consists of one share of common stock, par value $.01 per share, and a warrant to purchase one half share of common stock. The warrants have an exercise price of $1.80 per
share, are exercisable immediately, and will expire five years from the date of issuance. The Company expects to receive gross proceeds of approximately $16.2 million, before deducting underwriting discounts and commissions and other estimated
offering expenses. The Company has also granted the underwriters a 30 day option to purchase up to an additional 1,675,500 units to cover over allotments, if any. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The offering is expected to close on or about October&nbsp;7, 2013, subject to customary closing conditions. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Chardan Capital Markets is acting as sole bookrunner for the offering and Maxim Group LLC is acting as co-manager on the deal. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">StemCells intends to use the net proceeds of the offering for general corporate purposes, including working capital and operational purposes, including
product development. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The securities are being offered by means of a prospectus supplement and accompanying prospectus, forming a part of the effective
registration statement, a copy of which may be obtained, when available, at the website of the Securities and Exchange Commission (SEC) at http://www.sec.gov. Electronic copies of the preliminary prospectus also may be obtained from Chardan Capital
Markets, LLC Capital Markets, 17 State Street, Suite 1600, New York, NY 10004, at 646-465-9012. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">This press release shall not constitute an offer to sell
or the solicitation of an offer to buy these securities, nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities
laws of any such jurisdiction. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>About StemCells, Inc. </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">StemCells, Inc. is engaged in the research, development, and commercialization of cell-based therapeutics and tools for use in stem cell-based research and
drug discovery. The Company&#146;s lead therapeutic product candidate, HuCNS-SC<SUP STYLE="font-size:85%; vertical-align:top">&reg;</SUP> cells (purified human neural stem cells), is currently in development as a potential treatment for a broad
range of central nervous system disorders. In a Phase&nbsp;I clinical trial in Pelizaeus-Merzbacher disease (PMD), a fatal myelination disorder in children, the </P>

<p Style='page-break-before:always'>
<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
Company has shown preliminary evidence of progressive and durable donor-derived myelination in all four patients transplanted with HuCNS-SC cells. The Company is conducting a Phase I/II clinical
trial in chronic spinal cord injury in Switzerland, Canada and the United States, and has reported positive interim data for the first three patients. The Company is also conducting a Phase I/II clinical trial in dry age-related macular degeneration
(AMD) in the United States. In addition, the Company is pursuing preclinical studies in Alzheimer&#146;s disease, with support from the California Institute for Regenerative Medicine (CIRM). StemCells also markets stem cell research products,
including media and reagents, under the SC Proven<SUP STYLE="font-size:85%; vertical-align:top">&reg;</SUP> brand. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><I>Apart from statements of historical
fact, the text of this press release constitutes forward-looking statements within the meaning of the U.S. securities laws, and is subject to the safe harbors created therein. These statements include, but are not limited to, statements regarding
the future business operations of StemCells, Inc. (the &#147;Company&#148;); the Company&#146;s intention and ability to complete the offering and the expected use of net proceeds; and the prospect for continued clinical development of the
Company&#146;s HuCNS-SC cells in CNS disorders. These forward-looking statements speak only as of the date of this news release. The Company does not undertake to update any of these forward-looking statements to reflect events or circumstances that
occur after the date hereof. Such statements reflect management&#146;s current views and are based on certain assumptions that may or may not ultimately prove valid. The Company&#146;s actual results may vary materially from those contemplated in
such forward-looking statements due to risks and uncertainties to which the Company is subject, including the fact that additional trials will be required to demonstrate the safety and efficacy of the Company&#146;s HuCNS-SC cells for the treatment
of any disease or disorder; ; uncertainties regarding the Company&#146;s ability to obtain the increased capital resources needed to continue its current and planned research and development operations; uncertainties regarding the Company&#146;s
ability to commercialize a therapeutic product and its ability to successfully compete with other products on the market; and other factors that are described under the heading &#147;Risk Factors&#148; in the Company&#146;s Annual Report on Form
10-K for the year ended December&nbsp;31, 2012, and in its subsequent reports on Form 10-Q and Form 8-K. </I></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">CONTACT: </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Rodney Young </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">StemCells, Inc. </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Chief Financial Officer </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">(510) 456-4128 </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Ian Stone </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Russo Partners </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">(619) 308-6541 </P>
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<DOCUMENT>
<TYPE>EX-99.3
<SEQUENCE>7
<FILENAME>d608543dex993.htm
<DESCRIPTION>EX-99.3
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="right"><B>Exhibit 99.3 </B></P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<P STYLE="margin-top:0pt;margin-bottom:0pt">


<IMG SRC="g608543ex992_pg001.jpg" ALT="LOGO">
 </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>STEMCELLS, INC. RECEIVES FDA AUTHORIZATION OF IND FOR SPINAL CORD INJURY </B></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>NEWARK, Calif., (October 2, 2013)</B> &#150; StemCells, Inc. (Nasdaq: STEM) announced today that the U.S. Food and Drug Administration (FDA) has authorized
the Company&#146;s Investigational New Drug (IND) application for clinical testing of the Company&#146;s proprietary HuCNS-SC<SUP STYLE="font-size:85%; vertical-align:top">&reg;</SUP> human neural stem cells as a treatment for spinal cord injury. As
a first action under this IND, the Company is working to open U.S. sites for its Phase I/II clinical trial for chronic spinal cord injury, which is currently underway in Switzerland and Canada. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">&#147;This IND is a significant step forward for our spinal cord injury program,&#148; said Stephen Huhn, MD, FACS, FAAP, Vice President, CNS Clinical
Research at StemCells, Inc. &#147;With regulatory authorization from Switzerland, Canada and now the United States, we have the first international trial of a stem cell therapy for spinal cord injury. To date, we have transplanted seven patients
from Germany, Norway, Italy, Israel, Canada, and the United States at Balgrist University Hospital in Zurich. We now look forward to enrolling patients at U.S. and Canadian sites and easing the travel burden for North American-based patients. Our
goal is to complete enrollment in the trial by the first quarter of next year. This is the Company&#146;s fourth FDA-authorized IND, and the agency has now cleared clinical studies of our HuCNS-SC cells in all three elements of the CNS, the brain,
the eye and the spinal cord.&#148; </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Roman Reed, President of the Roman Reed Foundation, added, &#147;This is great news for the spinal cord community.
StemCells has not seen any safety issues in the ongoing trial, and they have reported truly exciting preliminary results, with gains in sensory function persisting for 12 months after transplantation. With this green light from the FDA, it will be
much easier for American patients to participate in this innovative trial. This is another step forward in our quest to find a cure for paralysis.&#148; </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The Roman Reed Foundation (<U>www.romanreedfoundation.com</U>) is a charitable organization dedicated to the cause of finding cures for neurological
disorders, in particular the alleviation of spinal cord injury paralysis. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>About the Spinal Cord Injury Clinical Trial </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The Company&#146;s Phase I/II clinical trial is designed to assess both safety and preliminary efficacy of HuCNS-SC cells as a treatment for chronic spinal
cord injury. The Company plans to enroll twelve patients with thoracic (chest-level) neurological injuries at the T2-T11 level, with the injury classified as </P>

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<HR  SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">

 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
complete or incomplete according to the American Spinal Injury Association Impairment Scale. To date, seven patients have been enrolled and transplanted with HuCNS-SC cells. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">All patients who enroll will receive HuCNS-SC cells through direct transplantation into the spinal cord and will be temporarily immunosuppressed. Patients
will be evaluated regularly in the post-transplant period in order to monitor and assess the safety of the HuCNS-SC cells, the surgery and the immunosuppression, as well as to measure any change in neurological function below the injury site.
Preliminary efficacy will be evaluated based on defined clinical endpoints, such as changes in sensation, motor function and bowel/bladder function. The Company intends to follow the effects of this therapy long-term, and each of the patients will
be invited to enroll into a separate four-year observational study after completing the Phase I/II study. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Data from the first three patients, each of
whom had suffered a complete injury prior to enrolling in the study, showed multi-segment gains in sensory function in two patients twelve months after transplantation of the HuCNS-SC cells. One of the two converted from a complete injury
classification to an incomplete injury. The third patient remained stable twelve months after transplantation. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The trial is currently enrolling at
Balgrist University Hospital, University of Zurich, a world-leading medical center for spinal cord injury and rehabilitation. Patients who may qualify and are interested in participating in the study should contact the Zurich site either by phone at
+41 44 386 3901 or by email at <U>stemcells.pz@balgrist.ch</U>. The Company is working to open trial sites in Canada and the United States. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Information
about the clinical trial is available at the ClinicalTrials.gov website of the National Institutes of Health at <U>http://www.clinicaltrials.gov/ct2/show/NCT01321333?lead=StemCells+Inc.&amp;rank=4</U>. Additional information about the Company&#146;s
spinal cord injury program can be found on the StemCells, Inc. website at <U><FONT STYLE="white-space:nowrap">http://www.stemcellsinc.com/Therapeutic-Programs/Clinical-Trials.htm</FONT></U> and at <U><FONT STYLE="white-space:nowrap"><FONT
STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap">http://www.stemcellsinc.com/Therapeutic-Programs/Spinal-Cord-Injury.htm</FONT></FONT></FONT></U>. </P>
<P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>About StemCells, Inc. </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">StemCells, Inc. is engaged in the
research, development, and commercialization of cell-based therapeutics and tools for use in stem cell-based research and drug discovery. The Company&#146;s lead therapeutic product candidate,
HuCNS-SC<SUP STYLE="font-size:85%; vertical-align:top">&reg;</SUP> cells (purified human neural stem cells), is currently in development as a potential treatment for a broad range of central nervous system disorders. In a Phase&nbsp;I clinical trial
in Pelizaeus-Merzbacher disease (PMD), a fatal myelination disorder in children, the Company has shown preliminary evidence of progressive and durable donor-derived myelination in all four patients transplanted with HuCNS-SC cells. The Company is
conducting a Phase I/II clinical trial in chronic spinal cord injury in Switzerland, Canada and the United States, and has reported positive interim data for the first three patients. The Company is also conducting a Phase I/II clinical trial in dry
age-related macular degeneration (AMD) in the United States. In addition, the Company is pursuing preclinical studies in Alzheimer&#146;s disease, with support from the California Institute for Regenerative
</P>

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Medicine (CIRM). StemCells also markets stem cell research products, including media and reagents, under the SC Proven<SUP STYLE="font-size:85%; vertical-align:top">&reg;</SUP> brand. Further
information about StemCells is available at <U>http://www.stemcellsinc.com</U>. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><I>Apart from statements of historical fact, the text of this press
release constitutes forward-looking statements within the meaning of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended, and is subject to the safe harbors created therein. These statements include, but are
not limited to, statements regarding whether the improvements in sensory function seen in the Company&#146;s Phase I/II clinical study of spinal cord injury will persist and whether they will prove to be clinically meaningful; continued
authorization to conduct a clinical trial in Switzerland, Canada and the United States in chronic spinal cord injury; the timing and prospect of securing clinical trial sites in Canada and the United States to conduct the Company&#146;s Phase I/II
trial in spinal cord injury; the prospect for screening and then enrolling additional patients with incomplete spinal cord injury; the prospect for evaluating trial patients for changes in their sensation, motor function and bowel/bladder function;
the potential of the Company&#146;s HuCNS-SC cells to treat spinal cord injury and other central nervous system diseases and disorders; and the future business operations of the Company. These forward-looking statements speak only as of the date of
this news release. The Company does not undertake to update any of these forward-looking statements to reflect events or circumstances that occur after the date hereof. Such statements reflect management&#146;s current views and are based on certain
assumptions that may or may not ultimately prove valid. The Company&#146;s actual results may vary materially from those contemplated in such forward-looking statements due to risks and uncertainties to which the Company is subject, including the
fact that additional trials will be required to demonstrate the safety and efficacy of the Company&#146;s HuCNS-SC cells for the treatment of any disease or disorder; uncertainty as to whether applicable regulatory agencies will permit the Company
to continue clinical testing in spinal cord injury or in future clinical trials of proposed therapies for other diseases or conditions; uncertainties regarding the Company&#146;s ability to recruit the patients required to conduct its clinical
trials or to obtain meaningful results; uncertainties regarding the Company&#146;s ability to obtain the increased capital resources needed to continue its current and planned research and development operations; uncertainty as to whether HuCNS-SC
cells and any products that may be generated in the future in the Company&#146;s cell-based programs will prove safe and clinically effective and not cause tumors or other adverse side effects; uncertainties regarding the Company&#146;s ability to
commercialize a therapeutic product and its ability to successfully compete with other products on the market; and other factors that are described under the heading &#147;Risk Factors&#148; in the Company&#146;s Annual Report on Form 10-K for the
year ended December&nbsp;31, 2012, and in its subsequent reports on Form 10-Q and Form 8-K. </I></P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">CONTACT: </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Rodney Young </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">StemCells, Inc. </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Chief Financial Officer </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">(510) 456-4128 </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Ian Stone </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Russo Partners </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">(619) 308-6541 </P>
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`
end
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
