<SUBMISSION>
<ACCESSION-NUMBER>0001157523-07-000919
<TYPE>8-K
<PUBLIC-DOCUMENT-COUNT>4
<PERIOD>20070126
<ITEMS>3.02
<ITEMS>5.06
<ITEMS>9.01
<FILING-DATE>20070201
<DATE-OF-FILING-DATE-CHANGE>20070201
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>NeoStem, Inc.
<CIK>0000320017
<ASSIGNED-SIC>8090
<IRS-NUMBER>222343568
<STATE-OF-INCORPORATION>DE
<FISCAL-YEAR-END>1231
</COMPANY-DATA>
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<ACT>34
<FILE-NUMBER>000-10909
<FILM-NUMBER>07572604
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>420 LEXINGTON AVENUE
<STREET2>SUITE 450
<CITY>NEW YORK
<STATE>NY
<ZIP>10170
<PHONE>212-584-4171
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>420 LEXINGTON AVENUE
<STREET2>SUITE 450
<CITY>NEW YORK
<STATE>NY
<ZIP>10170
</MAIL-ADDRESS>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>PHASE III MEDICAL INC/DE
<DATE-CHANGED>20030819
</FORMER-COMPANY>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>CORNICHE GROUP INC /DE
<DATE-CHANGED>19951117
</FORMER-COMPANY>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>FIDELITY MEDICAL INC
<DATE-CHANGED>19951025
</FORMER-COMPANY>
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<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>a5324274.txt
<DESCRIPTION>NEOSTEM, INC. 8-K
<TEXT>
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                              Washington, DC 20549

                                    FORM 8-K

                                 CURRENT REPORT
     Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

       Date of Report (Date of earliest event reported): January 26, 2007

                                  NEOSTEM, INC.
             (Exact name of registrant as specified in its charter)


                Delaware                0-10909                 22-2343568
            (State Or Other           (Commission             (IRS Employer
             Jurisdiction Of          File Number)          Identification No.)
              Incorporation)

        420 Lexington Avenue, Suite 450
              New York, New York                                       10170
--------------------------------------------------------------------------------
   (Address of principal executive offices)                         (Zip Code)

       Registrant's telephone number, including area code: (212)-584-4814

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 (see General Instruction A.2. below):

[] Written communications pursuant to Rule 425 under the Securities Act
    (17 CFR 230.425)

[] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
    (17 CFR 240.14a-12)

[] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
   Act (17 CFR 240.14d-2(b))

[] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
   Act (17 CFR 240.13e-4(c))

<PAGE>

Item 3.02.        Unregistered Sales of Equity Securities.

         On each of January 26, 2007 and February 1, 2007,  NeoStem,  Inc.  (the
"Company") entered into Subscription Agreements (the "Subscription  Agreements")
with the  accredited  investors  listed  therein (the  "Investors")  totaling 31
Investors.  Pursuant to the Subscription Agreements,  the Company issued to each
Investor  units (the "Units")  comprised of two shares of its common stock,  par
value $.001 per share (the "Common Stock"), one redeemable seven-year warrant to
purchase one share of Common Stock at a purchase price of $.80 per share and one
non-redeemable  seven-year  warrant to purchase  one share of Common  Stock at a
purchase price of $.80 per share (together, the "Warrants"), at a per-Unit price
of $1.00.  The Company issued an aggregate of 2,220,000 Units to Investors,  for
an aggregate purchase price of $2,220,000.

         Pursuant to the Company's agreement with Emerging Growth Equities, Ltd.
("EGE"), the placement agent for the private placement,  the Company paid to EGE
a cash fee equal to $160,075 and is reimbursing them for certain expenses not to
exceed  $50,000.  The Company also issued to them  warrants to purchase  160,075
Units.

         Pursuant to the terms of the Subscription Agreements,  the Company will
prepare  and file,  no later  than ten days  after the  filing of the  Company's
Annual Report on Form 10-K, a  Registration  Statement  with the SEC to register
the shares of Common Stock  issued to  Investors  and the shares of Common Stock
underlying the Warrants.

         The Investor's execution of the Subscription Agreements was conditioned
upon entry by the Company's  Board of Directors  and  executive  officers into a
lock-up  agreement,  pursuant to which such  directors  and  officers  will not,
without  the  consent of EGE,  sell or  transfer  their  Common  Stock until the
earlier of: (a) six months  following  the  effective  date of the  Registration
Statement  filed to  register  the shares  underlying  the Units,  or (b) twelve
months following the sale of the Units.

         The  sales  of the  above  securities  were  exempt  from  registration
pursuant  to Section  4(2) of the  Securities  Act of 1933,  as  amended  and/or
Regulation D thereunder.


Item 5.06         Change in Shell Company Status.

         As previously reported in a Current Report on Form 8-K, in January 2006
the  Company  completed  an  acquisition  of  the  assets  of NS  California,  a
California  corporation ("NS California"),  relating to NS California's business
of  collecting  and  storing  adult stem cells (the "Stem Cell  Business").  The
purchase price consisted of 500,000 shares of Common Stock, subject to reduction
under  certain   circumstances,   plus  the  assumption  of  certain  enumerated
liabilities of NS California and liabilities under assumed contracts.  Effective
with the  acquisition,  the Stem  Cell  Business  of NS  California  became  the
Company's  principal  business,  rather than its historic  business of providing
capital and business  guidance to companies in the  healthcare  and life science
industries.

<PAGE>

         Further,  as previously  reported in Current Reports on Form 8-K, since
the acquisition of the assets of NS California the Company has been issued a new
biologics  license from the State of  California,  has entered into an agreement
with Ronald Rothenberg,  M.D. for the operation of a collection center for adult
stem cells in Encinitas,  California,  which has commenced  operations,  and has
entered into an agreement  with HemaCare  Corporation  ("Hemacare")  pursuant to
which  HemaCare  will provide the Company with,  among other  things,  exclusive
collection  services  for the  procurement  of adult stem cells from  peripheral
blood for the purpose of long-term storage,  operating procedures and assistance
in training  and opening  additional  collection  facilities.  The Company  also
engaged in various capital raising activities to finance the Stem Cell Business,
raising  approximately  $3.6  million  in 2006 and $2.2  million to date in 2007
through the sale of Common Stock, warrants and convertible promissory notes.

     The Company  believes  that, as a result of its current  operations and the
completion of the  transactions  described  above,  it has ceased to be a "shell
company" as defined in Rule 12b-2 of the  Securities  Exchange  Act of 1934,  as
amended.

Item 9.01.        Financial Statements and Exhibits.

(d)  Exhibits.
     ---------

         Exhibit 10.1      Form of Subscription  Agreement among NeoStem,  Inc,
                           Emerging Growth Equities,  Ltd. and certain investors
                           listed therein.

         Exhibit 10.2      Form of Redeemable Warrant to Purchase Shares of
                           Common Stock of NeoStem, Inc.

         Exhibit 10.3      Form of Non-Redeemable Warrant to Purchase Shares of
                           Common Stock of NeoStem, Inc.

<PAGE>

                                    SIGNATURE

         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.

                                  NEOSTEM, INC.



                                  By:      /s/ Catherine M. Vaczy
                                           -------------------------------------
                                           Catherine M. Vaczy
                                           VP and General Counsel




Dated: February 1, 2007

<PAGE>

                                  EXHIBIT INDEX
                                  -------------


Exhibit Number             Description
--------------             -----------

         Exhibit 10.1      Form of Subscription  Agreement among NeoStem,  Inc,
                           Emerging Growth Equities,  Ltd. and certain investors
                           listed therein.

         Exhibit 10.2      Form of Redeemable Warrant to Purchase Shares of
                           Common Stock of NeoStem, Inc.

         Exhibit 10.3      Form of Non-Redeemable Warrant to Purchase Shares of
                           Common Stock of NeoStem, Inc.

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.1
<SEQUENCE>2
<FILENAME>a5324274ex10_1.txt
<DESCRIPTION>EXHIBIT 10.1
<TEXT>
                                                                    Exhibit 10.1

                             SUBSCRIPTION AGREEMENT


NeoStem, Inc.
420 Lexington Avenue
Suite 450
New York, New York  10170
Attention:  Chief Executive Officer

Ladies and Gentlemen:

         The undersigned investor (the "Investor") under the following terms and
conditions, offers to subscribe (the "Offer") for the securities of NeoStem,
Inc., a Delaware corporation. (the "Company" or "NeoStem"). The Company is
issuing units ("Units") at a per Unit price of $1.00 with each Unit consisting
of (a) two shares (the "Common Shares") of common stock, $.001 par value (the
"Common Stock") and (b) two accompanying warrants (each, a "Warrant" and
together the "Warrants") each for the purchase of one share of Common Stock at
an exercise price of $0.80 per share, subject to adjustment, expiring seven
years from the date of issuance (the "Warrant Shares"). The forms of Warrant are
attached hereto as Exhibits A and A-1. Emerging Growth Equities, Ltd., a
Pennsylvania limited partnership, is serving as the "Placement Agent" in
connection with this Offering and U.S. Bank National Association will serve as
the "Escrow Agent" hereunder. The Company, the Placement Agent and the Escrow
Agent have entered into an Escrow Agreement.

         The Investor understands that the Units are being issued pursuant to
one or more exemptions from the registration requirements of the Securities Act
of 1933, as amended (the "Securities Act" or the "Act"), in a private placement
pursuant to an exemption from registration under Regulation D promulgated under
Section 4(2) and Rule 506 of the Act. As such, the Common Stock, the Warrants
and the Warrant Shares each are "restricted securities" and may not be sold or
transferred absent a registration statement declared effective under the Act or
an exemption from the registration requirements of the Act.

         1. Subscription.
            -------------

         The closing (the "Closing") of the transactions hereunder shall take
place at the offices of Company or at such other location as the Company and the
Placement Agent shall mutually agree after the receipt by the Company of
subscriptions for Units from Investors with an aggregate Purchase Price of up to
$3,000,000 and after it has been determined that all conditions in this
Agreement and the Escrow Agreement have been met in the sole and absolute
discretion of the Company and the Placement Agent. At each Closing, in
accordance with the Escrow Agreement, funds equal to the Subscription Amount of
each Investor shall be delivered to the Company and the Company shall deliver to
each such Investor his, her or its respective Shares and Warrants as provided
herein.
         Subject to the terms and conditions hereinafter set forth in this
Subscription Agreement, the Investor hereby offers to subscribe for Units as set
forth in the Investor Signature Page attached hereto and contemporaneously
herewith makes payment for the purchase of the Units by wire transfer or check
as set forth in the Escrow Agreement

         2. Conditions.
            -----------

          The Offer is made subject to the  following  conditions:  (i) that the
Company,  acting in good  faith,  shall have the right to accept or reject  this
Offer, in whole or in part, for any reason;  (ii) that the Placement Agent shall
determine  that the terms of the Escrow  Agreement have been met; (iii) that the
Investor agrees to comply with the terms of this Subscription Agreement; (iv) at
the  Closing  (but not at  subsequent  closings),  a legal  opinion  of  Company
Counsel,  in the form of Exhibit B attached hereto shall be delivered and (v) at
the Closing (but not at subsequent  closings),  the receipt of a lock-up  letter
(in the Form  attached  hereto as Exhibit  C) from each  executive  officer  and
member of the Board of Directors of the Company shall be delivered.


                                       1
<PAGE>

          Acceptance  of this Offer shall be deemed given by the  countersigning
of this Subscription  Agreement by the Company and the funds being released from
the Escrow Agreement  pursuant to joint written  instructions of the Company and
the Placement Agent. In the event the Company does not accept the Offer, any and
all proceeds for the purchase of the Units by the Investor  shall be returned to
Investor.

         3. Representations and Warranties of the Investor.
            -----------------------------------------------

          The  Investor,  in order to induce the  Company to accept  this Offer,
hereby warrants and represents as follows:

          (a) Organization; Authority. The Investor, if not an individual, is an
entity duly organized,  validly  existing and in good standing under the laws of
the jurisdiction of its  organization  with the requisite power and authority to
enter into and to consummate the transactions  contemplated by this Subscription
Agreement and otherwise to carry out its obligations hereunder.  The purchase by
Investor of the Units hereunder has been duly authorized by all necessary action
on the part of Investor.  This Subscription  Agreement has been duly executed by
Investor,  and when  delivered by Investor in accordance  with the terms hereof,
will  constitute  the  valid  and  legally   binding   obligation  of  Investor,
enforceable  against it in accordance  with its terms,  except (i) as limited by
general   equitable   principles   and   applicable   bankruptcy,    insolvency,
reorganization,  moratorium  and other  laws of  general  application  affecting
enforcement of creditors' rights generally, and (ii) as limited by laws relating
to  the  availability  of  specific  performance,  injunctive  relief  or  other
equitable remedies.

          (b)  Investor  Representation.  Investor  understands  that the Units,
Common Shares,  Warrants and Warrant Shares are each "restricted securities" and
have not been  registered  under  the  Securities  Act or  qualified  under  any
applicable  state  securities  law by reason of their  issuance in a transaction
that  does not  require  registration  or  qualification  (based  in part on the
accuracy  of  the  representations  and  warranties  of the  Investor  contained
herein),  and that such securities must be held indefinitely unless a subsequent
disposition  is registered  under the  Securities  Act or any  applicable  state
securities laws or is exempt from such registration.  The Investor hereby agrees
that the Company may insert the  following or similar  legend on the face of the
certificates  evidencing the Units, Common Shares,  Warrants and Warrant Shares,
if required in compliance with federal and state securities laws:

          "These securities have not been registered under the Securities Act of
1933, as amended (the  "Securities  Act") nor under the  securities  laws of any
state. They may not be sold, offered for sale, or hypothecated in the absence of
a registration statement in effect with respect to the securities under such act
or an  opinion of  counsel  reasonably  satisfactory  to the  company  that such
registration is not required  pursuant to a valid exemption  therefrom under the
Securities Act."

          The  Investor   understands  and  acknowledges   that  the  Commission
currently  takes the  position  that  coverage  of short  sales of shares of the
Common Stock  "against the box" prior to the  effective  date of a  registration
statement registering the re-sale of the Common Shares and the Warrant Shares is
a violation of Section 5 of the Securities Act, as set forth in Item 65, Section
5  under   Section   A,  of  the   Manual  of   Publicly   Available   Telephone
Interpretations,  dated July  1997,  compiled  by the  Office of Chief  Counsel,
Division of Corporation Finance. Accordingly, the Investor agrees not to use any
of the Common  Shares or Warrant  Shares to cover any short  sales made prior to
the effective date of such registration statement.

          (c) No Distribution.  Investor is acquiring the Units as principal for
its own account, in the ordinary course of its business,  and not with a view to
or for distributing or reselling such Units or any part thereof. Investor has no
present intention of distributing any of such Common Shares, Warrants or Warrant
Shares and has no agreement or understanding,  directly or indirectly,  with any
other   individual,    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 (each, a "Person") regarding the distribution of such Common Shares,
Warrants or Warrant Shares (this  representation  and warranty not limiting such
Investor's right or intent to sell the Common Share,  Warrants or Warrant Shares
pursuant to a Registration  Statement or otherwise in compliance with applicable
federal and state securities laws).

                                       2
<PAGE>

          (d)  Investor  Status.  Investor  is,  and on each  date on  which  it
exercises  any Warrants it will be an  "Accredited  Investor" as defined in Rule
501(a)(1),  (a)(2),  (a)(3),  (a)(7),  or (a)(8)  under the  Securities  Act. In
general,  an Accredited  Investor is deemed to be an institution  with assets in
excess of  $5,000,000 or  individuals  with net worth in excess of $1,000,000 or
annual income exceeding $200,000, or $300,000 jointly with their spouse.

          (e)  Experience of Investor.  Investor,  either alone or together with
its  representatives,  has such  knowledge,  sophistication,  and  experience in
business and financial  matters so as to be capable of evaluating the merits and
risks of the  prospective  investment  in the Units,  and has so  evaluated  the
merits and risks of such investment.  The Investor has not authorized any Person
to act as his Purchaser  Representative (as that term is defined in Regulation D
of the General  Rules and  Regulations  under the Act) in  connection  with this
transaction.  Investor is able to bear the economic risk of an investment in the
Units  and,  at the  present  time,  is able to afford a  complete  loss of such
investment.

          (f) General  Solicitation.  Investor is not  purchasing the Units as a
result of any advertisement,  article,  notice or other communication  regarding
the Units  published in any newspaper,  magazine,  or similar media or broadcast
over  television  or radio or  presented  at any  seminar  or any other  general
solicitation or general advertisement.

          (g) Access to  Information.  The Investor has reviewed the SEC Reports
(as that term is defined in Section 4(g)) and neither the Company nor any of its
representatives  have  made  any  other  representations  or  warranties  to the
Investor  with respect to the Company  except as contained  herein or in the SEC
Reports.  The Investor has also been afforded the  opportunity  to ask questions
of, and receive  answers  from,  the  officers  and/or  directors of the Company
concerning the terms and conditions of the Offering and to obtain any additional
information,  to the extent that the Company  possesses such  information or can
acquire it  without  unreasonable  effort or  expense,  necessary  to verify the
accuracy  of  the  information  furnished;  and  has  availed  himself  of  such
opportunity  to the extent he  considers  appropriate  in order to permit him to
evaluate the merits and risks of an  investment  in the Units.  It is understood
that all documents,  records,  and books pertaining to this investment have been
made available for inspection by the Investor during  reasonable  business hours
at the Company's principal place of business.  Notwithstanding the foregoing, it
is understood  that the Investor is purchasing the Units without being furnished
any prospectus setting forth all of the information that would be required to be
furnished under the Securities Act and this Offering has not been passed upon or
the merits thereof endorsed or approved by any state or federal authorities.

         4. Representations and Warranties of the Company.
            ----------------------------------------------

          The Company hereby makes the following  representations and warranties
to the Investor:

          (a)  Organization  and  Qualification.  Each  of the  Company  and its
subsidiaries  (each, a "Subsidiary") 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),  with 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, would not
have or reasonably be expected to result in (i) a material adverse effect on the
legality,  validity or  enforceability of this  Subscription  Agreement,  (ii) a
material  adverse  effect  on  the  results  of  operations,  assets,  business,
prospects or financial condition of the Company and the Subsidiaries, taken as a
whole, or (iii) a material adverse effect on the Company's ability to perform in
any material respect on a timely basis its obligations  under this  Subscription
Agreement  (any of (i),  (ii),  or (iii),  a "Material  Adverse  Effect") and 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.

                                       3
<PAGE>

          (b)  Authorization;   Enforcement.   The  Company  has  the  requisite
corporate  power and authority to enter into and to consummate the Offering,  to
issue the Units and, upon due exercise of the Warrants, to duly issue the shares
of Common  Stock  deliverable  thereunder.  The  execution  and delivery of this
Subscription  Agreement and the Units by the Company and the  consummation by it
of the  transactions  contemplated  hereby  have  been  duly  authorized  by all
necessary  action on the part of the Company and no further consent or action is
required by the Company,  other than the Required  Approvals (as defined below).
This Subscription Agreement,  when executed and 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) as
limited by applicable bankruptcy,  insolvency,  reorganization,  moratorium, and
other laws of general  application  affecting  enforcement of creditors'  rights
generally and (ii) as limited by laws relating to the  availability  of specific
performance, injunctive relief or other equitable remedies.

          (c) No Conflicts.  The execution,  delivery,  and  performance of this
Subscription Agreement by the Company and the consummation by the Company of the
Offering and  issuance of the Units does not and will not: (i) conflict  with or
violate any  provision  of the  Company's  or any  Subsidiary's  certificate  or
articles of incorporation,  bylaws or other  organizational or charter documents
or  (ii)  subject  to  obtaining  the  Required  Approvals,  conflict  with,  or
constitute  a default  (or an event  that  with  notice or lapse of time or both
would  become a default)  under,  or give to others  any rights of  termination,
amendment,  acceleration or cancellation (with or without notice,  lapse of time
or  both)  of  any  agreement,   credit  facility,  debt,  or  other  instrument
(evidencing  the  Company's  or a  Subsidiaries'  debt or  otherwise)  or  other
understanding  to which the Company or either of the  Subsidiaries is a party or
by which any  property or asset of the Company or its  Subsidiaries  is bound or
affected,  or (iii) result in a violation of any law, rule,  regulation,  order,
judgment,  injunction, decree, or other restriction of any court or governmental
authority as currently in effect to which the Company or any of the Subsidiaries
is subject (including federal and state securities laws and regulations),  or by
which any  property  or asset of the  Company or either of the  Subsidiaries  is
bound or affected; except in the case of each of clauses (ii) and (iii), such as
could not, individually or in the aggregate have a Material Adverse Effect.

          (d) Filings,  Consents, and Approvals.  Neither the Company nor any of
the Subsidiaries is required to obtain any consent,  waiver,  authorization,  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 or other Person
in connection  with the  execution,  delivery and  performance by the Company of
this Subscription Agreement,  other than: (i) the filing with the Securities and
Exchange  Commission  ("Commission") of the Registration  Statement  pursuant to
Section  5,  (ii)  the  filing  with  the  Commission  of a Form D  pursuant  to
Commission  Regulation D, and (iii)  applicable Blue Sky filings  (collectively,
the "Required Approvals").

          (e) Issuance of the Units. The Units, and each component or underlying
security,  are duly  authorized and, when issued and paid for in accordance with
this  Subscription  Agreement,  will be duly and validly issued,  fully paid and
nonassessable,  free and clear of all liens,  and not subject to any  preemptive
rights. The Company will reserve from its duly authorized capital stock a number
of shares of Common Stock required for issuance of the Warrant Shares.

                                       4
<PAGE>

          (f)  Capitalization.  The number of shares and type of all authorized,
issued, and outstanding  capital stock of the Company is as set forth in the SEC
Reports as of the respective dates set forth therein. No Person has any right of
first refusal, preemptive right, right of participation, or any similar right to
participate in the Offering. Except as set forth in the SEC Reports, and options
and shares of capital stock issued or issuable under the Company's  stock option
plan and Warrants being offered  hereunder and to other  potential  Investors in
the  Units,  there  are no  outstanding  options,  warrants,  script  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 or entity any right to subscribe for or acquire, any shares of
Common Stock, or contracts, commitments, understandings or arrangements by which
the  Company  or  either of the  Subsidiaries  is or may  become  bound to issue
additional  shares of Common  Stock,  or  securities  or rights  convertible  or
exchangeable into shares of Common Stock except for the Company's agreement with
Utek Corporation relating to the issuance of 120,000 shares of Common Stock. The
issuance  and sale of the Units will not obligate the Company to issue shares of
Common  Stock or other  securities  to any Person  (other than  pursuant to this
Offering) 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 none of such  outstanding  shares was
issued in violation of any preemptive  rights or similar rights to subscribe for
or purchase securities. No further approval or authorization of any stockholder,
the Board of Directors  of the  Company,  or others is required for the issuance
and sale of the Units and the underlying  Warrant  Shares.  Upon exercise of the
Warrants in accordance  with their terms,  the Warrant Shares  issuable  thereby
will be deemed duly authorized, validly issued, fully paid and non-accessible in
all respects.

          (g) SEC  Reports;  Financial  Statements.  The  Company  has filed all
reports  required to be filed by it under the  Securities  Act and the  Exchange
Act,  including  pursuant to Section 13(a) or 15(d)  thereof,  for the two years
preceding the date hereof (or such shorter period as the Company was required by
law to file such material) (the foregoing materials being collectively  referred
to herein as the "SEC Reports").  As of their respective  dates, the SEC Reports
complied in all material  respects with the  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 Company has
advised  Investor(s)  that a copy of each of the SEC Reports  (together with all
exhibits  and  schedules  thereto  and as  amended  to  date)  is  available  at
http://www.sec.gov, a website maintained by the Commission where Investor(s) may
view the SEC Reports.

          (h) Material  Changes.  Since the date of the latest audited financial
statements included in the SEC Reports,  except as specifically disclosed in the
SEC Reports,  (i) there has been no event,  occurrence,  or development that has
had a Material Adverse Effect, (ii) the Company has not incurred any liabilities
(contingent  or otherwise)  other than (A) trade  payables and accrued  expenses
incurred in the ordinary  course of business  consistent  with past practice and
(B)  liabilities  not  required  to be  reflected  in  the  Company's  financial
statements pursuant to GAAP or required to be disclosed in filings made with the
Commission,  (iii) the Company has not altered its method of  accounting  or the
identity of its  auditors,  and (iv) the  Company  has not  declared or made any
dividend or distribution of cash or other property to its stockholders except in
the ordinary course of business  consistent  with prior practice,  or purchased,
redeemed or made any  agreements to purchase or redeem any shares of its capital
stock  except  consistent  with prior  practice or pursuant to existing  Company
stock option or similar plans.

          (i)  Litigation.  Except as set forth in the SEC  Reports  and routine
inquiries,  there is no action, suit, inquiry, notice of violation,  proceeding,
or investigation pending or, to the knowledge of the Company, threatened against
or affecting the Company, the Subsidiaries or any of its properties before or by
any court,  arbitrator,  governmental  or  administrative  agency or  regulatory
authority  (federal,  state,  county,  local,  or  foreign)  (collectively,   an
"Action") which: (i) adversely  affects or challenges the legality,  validity or
enforceability  of this  Subscription  Agreement or the Units or (ii) could,  if
there were an unfavorable  decision,  individually or in the aggregate,  have or
reasonably be expected to result in a Material Adverse Effect.  The Company does
not have pending before the Commission any request for confidential treatment of
information.  There has not been, and to the knowledge of the Company,  there is
not pending or contemplated,  any investigation by the Commission  involving the
Company  or any  current or former  director  or  officer  of the  Company.  The
Commission  has not  issued  any  stop  order  or  other  order  suspending  the
effectiveness  of  any  registration  statement  filed  by  the  Company  or any
Subsidiaries under the Exchange Act or the Securities Act.

                                       5
<PAGE>

          (j) Labor  Relations.  No  material  labor  dispute  exists or, to the
knowledge of the Company,  is imminent  with respect to any of the  employees of
the Company or any Subsidiary  which could reasonably be expected to result in a
Material Adverse Effect.

          (k)  Compliance.  Neither  the Company  nor any  Subsidiary  (i) 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,  would 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) is in
violation of any order of any court,  arbitrator or governmental  body, or (iii)
is or  has  been  in  violation  of  any  statute,  rule  or  regulation  of any
governmental authority, including without limitation all foreign, federal, state
and local laws  applicable to its business except in each case as could not have
a Material Adverse Effect.

          (l) Regulatory Permits.  The Company and the Subsidiaries  possess the
certificates,  authorizations,  and permits issued by the  appropriate  federal,
state, local or foreign regulatory authorities necessary to conduct its business
as  described  in the SEC  Reports,  except  where the  failure to possess  such
permits  would not,  individually  or in the  aggregate,  have or  reasonably be
expected to result in a Material Adverse Effect  ("Material  Permits"),  and the
Company has not received any notice of proceedings relating to the revocation or
modification of any Material Permit, except for routine inquiries.

          (m)  Title to  Assets.  Except as set  forth in the SEC  Reports,  the
Company  and the  Subsidiaries  have good and  marketable  title in all real and
personal  property owned by them that is material to the business of the Company
and the Subsidiaries,  in each case free and clear of any liens, encumbrances or
other  restrictions.  Any real property and  facilities  held under lease by the
Company  and the  Subsidiaries  are held by them under  valid,  subsisting,  and
enforceable leases of which the Company and the Subsidiaries are in compliance.

          (n) Patents and  Trademarks.  To the best of the Company's  knowledge,
the Company and the  Subsidiaries  have,  or have  rights to use,  all  patents,
patent applications,  trademarks,  trademark applications,  service marks, trade
names, copyrights,  licenses, and other similar rights necessary or material for
use in  connection  with their  respective  businesses  as  described in the SEC
Reports  and which the failure to so have could have a Material  Adverse  Effect
(collectively,  the "Intellectual Property Rights"). Neither the Company nor any
Subsidiary has received a written notice that the  Intellectual  Property Rights
used by the Company or any  Subsidiary  violates or infringes upon the rights of
any Person.  To the  knowledge of the Company,  all such  Intellectual  Property
Rights are enforceable  and there is no existing  infringement by another Person
of any of the Intellectual Property Rights of others.

          (o)  Insurance.  The  Company  is insured by  insurers  of  recognized
financial  responsibility  against  such losses and risks and in such amounts as
are prudent in the Company's reasonable discretion. The Company has no 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.

                                       6
<PAGE>

          (p)  Transactions  with  Employees.  Except  as set  forth  in the SEC
Reports and any purchase of the Units,  none of the officers or directors of the
Company  and, to the  knowledge  of the  Company,  none of the  employees of the
Company  is  presently  a party  to any  transaction  with  the  Company  or any
Subsidiary  (other than for  services as  employees,  officers  and  directors),
including  any  contract,  agreement  or  other  arrangement  providing  for the
furnishing  of  services  to or by,  providing  for  rental of real or  personal
property to or from,  or  otherwise  requiring  payments to or from any officer,
director or such  employee or, to the  knowledge  of the Company,  any entity in
which any officer,  director, or any such employee has a substantial interest or
is an officer,  director,  trustee or partner, in each case in excess of $60,000
other than (i) for payment of salary or consulting  fees for services  rendered,
(ii)  reimbursement for expenses incurred on behalf of the Company and (iii) for
other  employee  benefits,  including  stock option  agreements  under any stock
option plan of the Company.

          (q)  Private   Placement.   Assuming  the  accuracy  of  the  Investor
representations and warranties set forth in Section 3, no registration under the
Securities Act is required for the offer and sale of the Units by the Company to
the Investor as contemplated hereby or the exercise of the Warrants.

          (r) Tax Status.  Except for matters that would not, individually or in
the  aggregate,  have or reasonably be expected to result in a Material  Adverse
Effect, the Company and each Subsidiary has filed all necessary  federal,  state
and foreign  income and  franchise tax returns and has paid or accrued all taxes
shown as due thereon, and the Company has no knowledge of a tax deficiency which
has been asserted or threatened against the Company or any Subsidiary.

          (s) No General Solicitation. Neither the Company nor any Person acting
on behalf of the  Company  has  offered  or sold any of the Units by any form of
general solicitation or general  advertising.  The Company has offered the Units
for sale only to each  investor in the  Offering and certain  other  "accredited
investors" within the meaning of Rule 501 under the Securities Act.

          (t)  Foreign  Corrupt  Practices.  Neither  the  Company,  nor  to the
knowledge  of the  Company,  any agent or other  person  acting on behalf of the
Company,  has (i) directly or  indirectly,  used any corrupt  funds for unlawful
contributions,  gifts,  entertainment  or other  unlawful  expenses  related  to
foreign  or  domestic  political  activity,  (ii) 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) failed to
disclose  fully any  contribution  made by the  Company  (or made by any  person
acting on its behalf of which the  Company is aware)  which is in  violation  of
law, or (iv)  violated in any  material  respect  any  provision  of the Foreign
Corrupt Practices Act of 1977, as amended

          (u)  Accountants.  The Company's  accountants are set forth in the SEC
Reports. To the Company's knowledge,  such accountants,  who the Company expects
will  express  their  opinion  with respect to the  financial  statements  to be
included in the Company's upcoming financial statements, are a registered public
accounting firm as required by the Securities Act.

          (v) Listing and Maintenance  Requirements.  The Company's Common Stock
currently  is quoted  on the  Over-the-Counter  Bulletin  Board  ("OTCBB").  The
Company  is,  and has no reason to believe  that it will not in the  foreseeable
future   continue  to  be,  in  compliance   with  the  periodic  SEC  reporting
requirements necessary to maintain quotations on the OTCBB.

         5.       Registration Rights.
                  --------------------

                                       7
<PAGE>

         The Company grants registration rights to the Investor under the
following terms and conditions:

          (a)  The  Company  will  prepare  and  file  (which  may  include  the
preparation  and  filing  of  one  or  more  pre-effective   amendments  to  any
registration  statements that relates to the Company's securities,  which may be
currently on file or may be subsequently filed with the Commission),  at its own
expense,  a registration  statement under the Securities Act (the  "Registration
Statement")  with the  Commission  within ten (10) days of the  filing  with the
Commission of its Annual Report on Form 10-K for the fiscal year ending December
31, 2006 (the "2006 Form 10-K") sufficient to permit the non-underwritten public
offering  and resale of the Common  Shares and the  Warrant  Shares  (subject to
adjustment as set forth in the Warrant) (the "Registrable  Securities")  through
the facilities of all  appropriate  securities  exchanges,  if any, on which the
Company's  Common Stock is being sold or on the  over-the-counter  market if the
Company's  Common Stock is quoted thereon.  Notwithstanding  the foregoing,  the
Company  shall not be  required  to  register  more  than that  number of shares
permitted for a non-primary offering under SEC Rule 415, and the Investor agrees
that the  number of Common  Shares  and  Warrant  Shares  which the  Company  is
required to register may be reduced  proportionately with all other Investors to
comply with Rule 415. All Common Shares and Warrant Shares excluded  pursuant to
this  reduction  will be included as soon as  practicable  by the Company on its
next registration  statement filed with the SEC on which such shares qualify for
inclusion.  The Company shall not be subject to any penalties or  adjustments if
the  registration  process  is  delayed  for any  reason as a result of Rule 415
issues.

          (b) The Company  will use its  reasonable  best  efforts to cause such
Registration Statement to become effective.  Subject to Section 5(a), the number
of shares  designated  in the  Registration  Statement  to be  registered  shall
include all of the Registrable Securities and shall include appropriate language
regarding reliance upon Rule 416 to the extent permitted by the Commission.  The
Company  will  notify  the  Investor  of  the  date  of   effectiveness  of  the
Registration Statement.

          (c)  The  Company  will   maintain  the   Registration   Statement  or
post-effective  amendment filed under the terms of this  Subscription  Agreement
effective under the Securities Act until the earlier of (i) the date that all of
the  Registrable  Securities  have  been  sold  pursuant  to  such  Registration
Statement,  (ii) all Registrable  Securities have been otherwise  transferred to
Persons who may trade such shares without  restriction under the Securities Act,
and the Company has delivered a new  certificate  or other evidence of ownership
for such  securities  not bearing a restrictive  legend,  (iii) all  Registrable
Securities may be sold at any time, without volume or manner of sale limitations
pursuant  to Rule  144(k) or any  similar  provision  then in  effect  under the
Securities Act in the opinion of counsel to the Company,  or (iv) two years from
the effective date of the Registration Statement (the "Effectiveness Period").

          (d) All  fees,  disbursements  and  out-of-pocket  expenses  and costs
incurred by the Company in  connection  with the  preparation  and filing of the
Registration  Statement,  in  making  filings  with  NASD  (including,   without
limitation,  pursuant  to NASD Rule  2710),  and in  complying  with  applicable
federal  securities  and Blue  Sky  laws  (including,  without  limitation,  all
attorneys'  fees of the  Company)  shall be borne by the  Company.  The Investor
shall bear any reasonable cost of underwriting and/or brokerage discounts, fees,
and  commissions,  if  any,  applicable  to  the  Registrable  Securities  being
registered and sold by an underwriter for the Investor and the fees and expenses
of their counsel.  The Company shall use its reasonable  best efforts to qualify
the Common Shares and Warrant Shares in the State of residence of the Investor..
However,  the  Company  shall not be required to qualify in any state which will
require  an escrow or other  restriction  relating  to the  Company  and/or  the
sellers,  or which will  require  the  Company to qualify to do business in such
state or require the Company to file  therein any general  consent to service of
process.  The Company at its expense will supply the Investor with copies of the
applicable  Registration Statement and any prospectus included therein and other
related  documents  in such  quantities  as may be  reasonably  requested by the
Investor.

                                       8
<PAGE>

          (e)  Certificates  evidencing  the  Registrable  Securities  shall not
contain any legend:  (i) following  any sale of Common Shares or Warrant  Shares
pursuant  to Rule 144,  or (ii) if such  Common  Shares or  Warrant  Shares  are
eligible  for sale  under Rule  144(k);  or (iii)  following  any sale of Common
Shares or Warrant  Shares  pursuant  to the  Registration  Statement;  provided,
however, in connection with the sale or transfer of the Common Shares or Warrant
Shares, Investor hereby agrees to adhere to and abide by all prospectus delivery
requirements  under  the  Securities  Act  and  rules  and  regulations  of  the
Commission and provide the Company with customary documentation,  as applicable.
The Company  shall cause its counsel to issue a legal  opinion to the  Company's
transfer  agent  promptly  upon  request  of the  Investor  if  required  by the
Company's  transfer  agent to effect the  removal of the legend  hereunder.  The
Company agrees that at such time as such legend is no longer required under this
Section 5(e), it will, as soon as reasonably  practicable following the delivery
by  Investor  to the  Company's  transfer  agent of a  certificate  representing
Registrable  Securities accompanied by appropriate stock power or other required
documentation,  as applicable,  issued with a restrictive legend (such date, the
"Legend  Removal  Date"),  deliver or cause to be delivered to such  Investor or
such Investor's  transferee a certificate  representing such shares that is free
from all  restrictive  and other  legends,  in each case  without  charge to the
Investor other than customary transfer fees which may be charged by the transfer
agent or broker-dealer.  The Company may not make any notation on its records or
give  instructions  to any  transfer  agent  of the  Company  that  enlarge  the
restrictions on transfer set forth in this Section 5(e).

          (f) In the event that the  Registration  Statement is not filed within
ten (10) days of the filing  with the  Commission  of the 2006 Form 10-K and the
Company does not use its  reasonable  best efforts to respond to any comments of
the SEC within fifteen (15) business days following receipt thereof, the Company
will issue to each Investor an additional one percent (1%) of Units sold to such
Investor in the Private  Placement for no  additional  cost.  Additionally,  for
every thirty (30) days that the Company  continues to be delayed from filing the
Registration  Statement  with the  Commission  or  continues  to fail to use its
reasonable  best efforts to respond to any  comments  from the  Commission,  The
Company will issue to each  Investor an  additional  1% of the Units sold in the
Private  Placement  to such  Investor for no  additional  cost.  All  additional
amounts that may be issued as provided  herein shall not exceed 10% of the Units
sold in the Private Placement. Such amounts shall be as partial compensation for
such failure and not as a penalty.

          (g) The Company  will use its  reasonable  best efforts to prepare and
make publicly  available in accordance  with Rule 144(c) such  information as is
required for Investor to sell the Registrable  Securities  under Rule 144 in the
event the Registration  Statement is unavailable.  The Company further covenants
that, in the event the Registration Statement is unavailable,  it will take such
further action as any holder of Registrable  Securities may reasonably  request,
all to the extent  required from time to time to enable such Person to sell such
Registrable  Securities without registration under the Securities Act within the
limitation of the exemptions provided by Rule 144.

          (h) In the case of each registration  effected by the Company pursuant
to any section herein, the Company will:

(i)       Prepare and file with the Commission  such  amendments and supplements
          to such  registration  statement and the prospectus used in connection
          with such  registration  statement  as may be necessary to comply with
          the  provisions of the Securities Act with respect to a disposition of
          all securities covered by such registration statement;

(ii)      Notify the Investor at any time when a prospectus  relating thereto is
          required to be delivered under the Securities Act, of the happening of
          any  event  as a result  of  which  the  prospectus  included  in such
          registration   statement,  as  then  in  effect,  includes  an  untrue
          statement  of a  material  fact or  omits  to  state a  material  fact
          required  to be stated  therein or  necessary  to make the  statements
          therein not  misleading or  incomplete  in light of the  circumstances
          then  existing,  and at the request of the  shareholders,  prepare and
          furnish to them a reasonable number of copies of a supplement to or an
          amendment  of  such  prospectus  as  may  be  necessary  so  that,  as
          thereafter  delivered  to the  Investor,  such  prospectus  shall  not
          include  an 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  or  incomplete  in  light of the
          circumstances  then  existing;  provided  that,  for not more  than 60
          consecutive  business  days (or a total of not more than 180  calendar
          days in any 12-month period),  the Company may delay the disclosure of
          material  non-public  information  concerning  the  Company the public
          disclosure  of which at the time is not, in the good faith  opinion of
          the Company in the best  interests of the Company and which may, based
          on advice of outside  counsel,  be  delayed  under  applicable  law or
          regulation (an "Allowed Delay");  provided,  further, that the Company
          shall promptly (a) notify each Investor in writing of the existence of
          (but in no event,  without the prior written consent of such Investor,
          shall  the  Company  disclose  to such  Investor  any of the  facts or
          circumstances  regarding) material non-public  information giving rise
          to an Allowed  Delay and (b) advise each  Investor in writing to cease
          all sales under such  registration  statement until the termination of
          the Allowed Delay;

                                       9
<PAGE>

(iii)    Use its reasonable best efforts to prevent the issuance of any stop
         order or other suspension of effectiveness of a registration statement,
         and, if such an order is issued, to obtain the withdrawal of such order
         at the earliest possible moment and to notify Investor (and, in the
         event of an underwritten offering, the managing underwriter) of the
         issuance of such order and the resolution thereof;

(iv)      If NASD Rule 2710 requires any broker-dealer to make a filing prior to
          executing a sale of  Registrable  Securities  by an Investor,  make an
          Issuer Filing with the NASD Corporate Financing Department pursuant to
          NASD Rule 2710 and respond  within five  business days to any comments
          received from NASD in connection therewith.

(v)       Otherwise  use  its  reasonable   best  efforts  to  comply  with  all
          applicable rules and regulations of the Commission.

          (i) To the  extent  Investor  includes  any  Common  Shares or Warrant
Shares in a  registration  statement  pursuant to the terms hereof,  the Company
will indemnify and hold harmless Investor,  its directors and officers, and each
Person,  if any, who controls Investor within the meaning of the Securities Act,
from and against,  and will reimburse  Investor,  its directors and officers and
each controlling  Person with respect to, any and all loss,  damage,  liability,
cost,  and  expense  to which  Investor  or such  controlling  Person may become
subject under the Securities Act or otherwise,  insofar as such losses, damages,
liabilities,  costs,  or expenses are caused by any untrue  statement or alleged
untrue statement of any material fact contained in such registration  statement,
any  prospectus  contained  therein or any amendment or supplement  thereto,  or
arise out of or are based upon the omission or alleged omission to state therein
a  material  fact  required  to be  stated  therein  or  necessary  to make  the
statements  therein,  in light of the circumstances in which they were made, not
misleading;  provided,  however, that the Company will not be liable in any such
case to the extent that any such loss, damage, liability, cost or expense arises
out of or is based upon any untrue  statement  or alleged  untrue  statement  or
omission or alleged omission so made in conformity with information furnished by
Investor or any such controlling  Person in writing  specifically for use in the
preparation thereof.

          (j) To the  extent  Investor  includes  any  Common  Shares or Warrant
Shares in a registration  statement pursuant to the terms hereof,  Investor will
indemnify  and hold  harmless the Company,  its  directors  and officers and any
controlling  Person  from and  against,  and will  reimburse  the  Company,  its
directors and officers and any  controlling  Person with respect to, any and all
loss, damage,  liability,  cost, or expense to which the Company,  its directors
and officers or such controlling  Person may become subject under the Securities
Act or  otherwise,  insofar as such  losses,  damages,  liabilities,  costs,  or
expenses are caused by any untrue  statement or alleged untrue  statement of any
material fact contained in such registration statement, any prospectus contained
therein or any  amendment or  supplement  thereto,  or arise out of or are based
upon the omission or alleged  omission to state therein a material fact required
to be stated  therein or necessary to make the statements  therein,  in light of
the  circumstances in which they were made, not misleading,  in each case to the
extent,  but only to the extent,  that such untrue  statement or alleged  untrue
statement or omission or alleged  omission  was so made in reliance  upon and in
conformity  with written  information  furnished by or on behalf of the Investor
specifically for use in the preparation  thereof and provided further,  that the
maximum  amount  that may be  recovered  from  Investor  shall be limited to the
amount of proceeds  received by Investor  from the sale of such shares of Common
Stock.

                                       10
<PAGE>

          (k) To the  extent any  indemnification  by an  indemnifying  party is
prohibited or limited by law, the indemnifying  party agrees to make the maximum
contribution  with respect to any amounts for which it would otherwise be liable
hereunder to the extent  permitted  by law,  provided  that (i) no  contribution
shall be made under  circumstances  where the indemnifying  party would not have
been liable for  indemnification  pursuant  to the  provisions  hereof,  (ii) no
seller of securities guilty of fraudulent  misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to  contribution  from
any   seller   of   securities   who  was   not   guilty   of  such   fraudulent
misrepresentation,  and (iii) the amount of the  contribution  together with any
other payments made in respect of such loss, damage,  liability,  or expense, by
any seller of securities shall be limited to the net amount of proceeds received
by such seller from the sale of such securities.

          (l) The Investor will  cooperate  with the Company in connection  with
this  Subscription  Agreement,  including  timely  supplying all information and
executing  and  returning the Selling  Securityholder  Notice and  Questionnaire
attached hereto as Exhibit D, and any other  documents  requested by the Company
that are required to enable the Company to perform its  obligations  to register
the Common Shares and Warrant Shares.

         6. Other Agreements of the Company and the Investor.
            -------------------------------------------------

          (a) Acknowledgment of Dilution.  The Company and Investor  acknowledge
that the  issuance of the Common  Shares and the  Warrant  Shares will result in
dilution  of the  outstanding  shares of Common  Stock,  which  dilution  may be
substantial.

          (b) Exercise  Procedures.  The form of Notice of Exercise  included in
the Warrants sets forth the totality of the procedures  required of the Investor
in order to exercise the Warrants.

          (c) Use of Proceeds.  The Company  shall use the net proceeds from the
sale of the Units hereunder for general  working capital  purposes in accordance
with its plan for growth.

          (d)  Transfer  and  Tradability  of the Common  Shares and the Warrant
Shares.  Should  the  Company's  Common  Stock  become  listed  on a  nationally
recognized exchange or marketplace, the Company shall cause all shares of Common
Stock which are registered in accordance  with the provisions of Section 5 above
to be listed or included for quotation on each exchange or  marketplace on which
the  Company's  shares of Common Stock are then listed or included for quotation
(or a superior  marketplace  as may be  applicable in the future) at least until
the later of (i) two years  from the date  hereof  and (ii) such time as all the
Warrant Shares have been sold.

          (e) Press Releases.  The Company shall issue a press release or file a
Current  Report  on  Form  8-K  reasonably  acceptable  to the  Placement  Agent
disclosing  all material  terms of the  transactions  contemplated  hereby.  The
Company and the  Placement  Agent shall  consult  with each other in issuing any
press  release with respect to the  transactions  contemplated  hereby,  and the
Placement  Agent shall have the right to review and  comment on the  contents of
any such press release prior to its release by the Company.  Notwithstanding the
foregoing,  the Company  shall be entitled to make any filing and press  release
that it  determines  is  required in order to comply  with any  applicable  law.
Notwithstanding  the foregoing,  other than in any registration  statement filed
pursuant to the Registration  Rights Agreement and filings related thereto,  the
Company  shall not publicly  disclose the name of any  Investor,  or include the
name of any Investor in any filing with the Commission or any regulatory  agency
without the prior written  consent of such  Investor,  except to the extent such
disclosure  is  required  by law or  applicable  regulations,  in which case the
Company shall provide each  Investor with prior notice of such  disclosure.

                                       11
<PAGE>

          (f) Confidentiality. Each Investor agrees that he, she or it will keep
confidential and will not disclose, divulge or use for any purpose other than to
monitor his, her or its investment in the Company any confidential,  proprietary
or secret  information  which such Investor may obtain from the Company pursuant
to financial statements, reports and other materials or information submitted by
the Company to such Investor  pursuant to this  Agreement or otherwise  (but not
including   the  SEC   Reports)   ("Confidential   Information"),   unless  such
Confidential  Information  is  known,  or until  such  Confidential  Information
becomes known, to the public (other than as a result of a breach of this section
by such Investor); provided, however, that an Investor may disclose Confidential
Information  (i) to his, her or its  attorneys,  accountants,  consultants,  and
other  professionals  to the  extent  necessary  to  obtain  their  services  in
connection with monitoring his, her or its investment in the Company, or (ii) as
may otherwise be required by law,  provided that the Investor  takes  reasonable
steps to  minimize  the  extent of any such  required  disclosure  and  promptly
notifies  the  Company  when it  becomes  aware of such legal  requirement.

         7. Miscellaneous.
            --------------

          (a)  Termination.  The  Investor  agrees  that he  shall  not  cancel,
terminate,  or  revoke  this  Subscription  Agreement  or any  agreement  of the
Investor  made  hereunder  other  than  as  set  forth  herein,  and  that  this
Subscription Agreement shall survive the death or disability of the Investor. If
the  Company  elects to cancel this  Subscription  Agreement,  provided  that it
returns to the Investor,  without interest and without deduction,  all sums paid
by the  Investor,  this Offer shall be null and void and of no further force and
effect, and no party shall have any rights against any other party hereunder.

          (b) Entire Agreement.  This Subscription Agreement,  together with the
exhibits  hereto,  contains  the entire  understanding  of the  Company  and the
Investor with respect to the subject matter hereof.

          (c) Notices. 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) the second  Business  Day
following the date of mailing, if sent by U.S. nationally  recognized  overnight
courier service,  or (b) upon actual receipt by the party to whom such notice is
required to be given. The address for such notices and  communications  shall be
to the Investor at his address set forth on the Investor  Signature Page, and to
the Company at the addresses set forth in the SEC Reports.

          (d) Amendments;  Waivers. No provision of this Agreement may be waived
or amended except in a written  instrument  signed, in the case of an amendment,
or in the case of a waiver,  by the Company and the Investors holding at least a
majority  of the  Registrable  Securities  then  outstanding.  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 either party to exercise
any right hereunder in any manner impair the exercise of any such right.

          (e) Construction. The headings herein are for convenience only, do not
constitute  a part of this  Subscription  Agreement  and  shall not be deemed to
limit or affect any of the provisions hereof.

          (f)  Successors  and Assigns.  This  Subscription  Agreement  shall be
binding  upon and inure to the benefit of the parties and their  successors  and
permitted assigns. The Company may not assign this Subscription Agreement or any
rights or  obligations  hereunder  without  the prior  written  consent  of each
Investor in the  Offering.  Investor  may assign any or all of its rights  under
this  Agreement to any Person to whom  Investor  assigns or transfers any of the
Common Shares or Warrant Shares.

                                       12
<PAGE>

          (g) No  Third-Party  Beneficiaries.  This  Subscription  Agreement  is
intended for the benefit of the parties hereto and their  respective  successors
and  permitted  assigns  and is not for the  benefit  of, nor may any  provision
hereof be enforced by, any other Person.

          (h)  Governing  Law.  All  questions   concerning  the   construction,
validity,  enforcement,  and interpretation of this Subscription Agreement 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  Subscription  Agreement  (whether  brought  against a party  hereto or its
respective affiliates, directors, officers, shareholders,  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,  and hereby  irrevocably  waives,  and agrees not to assert in any suit,
action  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 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 Subscription 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 manner  permitted by law. The parties hereby waive
all  rights to a trial by jury.  If either  party  shall  commence  an action or
proceeding to enforce any provisions of this  Subscription  Agreement,  then the
prevailing  party in such action or proceeding  shall be reimbursed by the other
party for its  attorneys'  fees and other costs and expenses  incurred  with the
investigation, preparation, and prosecution of such action or proceeding.

          (i) Survival.  The  representations  and warranties  contained  herein
shall survive the closing of the transaction hereunder.

          (j)  Execution.  In the  event  that any  signature  is  delivered  by
facsimile  transmission,  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  signature  page
were  an  original  thereof.  This  Agreement  may be  executed  in two or  more
counterparts  each of which shall be deemed an original,  but all of which shall
together constitute one and the same instrument.

          (k) Severability.  If any provision of this Subscription  Agreement is
held  to  be  invalid  or  unenforceable  in  any  respect,   the  validity  and
enforceability  of the  remaining  terms  and  provisions  of this  Subscription
Agreement  shall not in any way be affected or impaired  thereby and the parties
will  attempt  to  agree  upon a  valid  and  enforceable  provision  that  is a
reasonable  substitute therefore,  and upon so agreeing,  shall incorporate such
substitute provision in this Subscription Agreement.

          (l)  Remedies.  In addition to being  entitled to exercise  all rights
provided  herein or granted  by law,  including  recovery  of  damages,  each of
Investor  and the Company  will be entitled to specific  performance  under this
Subscription  Agreement.  The  parties  agree that  monetary  damages may not be
adequate  compensation  for  any  loss  incurred  by  reason  of any  breach  of
obligations  described in the  foregoing  sentence and hereby agrees to waive in
any action for specific  performance  of any such  obligation the defense that a
remedy at law would be adequate.

          (m) Fees and  Expenses.  Except as provided  in  writing,  the parties
hereto shall be responsible for their own legal and other  expenses,  if any, in
connection with this transaction.

                                       13
<PAGE>

        INVESTOR SIGNATURE PAGE FOR NEOSTEM, INC. SUBSCRIPTION AGREEMENT
           Please print or type, Use ink only. (All Parties Must Sign)

The undersigned Investor hereby certifies that he (i) has received and relied
solely upon the SEC Reports, this Subscription Agreement and their respective
exhibits and schedules, (ii) agrees to all the terms and conditions of this
Subscription Agreement, (iii) meets the suitability standards set forth herein
and (iv) is a resident of the state or foreign jurisdiction indicated below.

Dollar Amount of Units Subscribed for: $
                                        ----------------------

<TABLE>
<CAPTION>
<S>               <C>                                            <C>    <C>    <C>    <C>    <C>
                                                                 If other than individual check one and
--------------------------------------------------------------   indicate capacity of signatory under the
                  Name of Investor (Print)                       signature:
                                                                  []     Trust
                                                                  []     Estate
--------------------------------------------------------------
         Name of Joint Investor (if any) (Print)                  []     Uniform Gifts to Minors Act
                                                                         State of
                                                                                     ---------------------
                                                                  []     Attorney-in-fact
                                                                  []     Corporation
                                                                  []     Other
------------------------------------------------------------
                  Signature of Investor
                                                                   If Joint Ownership, Check one:
                                                                   []    Joint Tenants with Right of
                                                                         Survivorship
                                                                   []    Tenants in Common
--------------------------------------------------------------
         Signature of Joint Investor (if any)                      []    Tenants by the Entirety
                                                                   []    Community Property

--------------------------------------------------------------
         Capacity of Signatory (if applicable)                     Backup Withholding Statement:
                                                                   []     Please   check   this   box  only  if  the
                                                                          investor is subject to backup
                                                                           withholding
--------------------------------------------------------------
         Social Security or Taxpayer Identification Number
                                                                         Foreign Person:
Investor Address:                                                  []    Please   check   this   box  only  if  the
                                                                         investor  is A  nonresident  alien,  foreign
                                                                         corporation, foreign
                                                                         partnership, foreign trust or
                                                                         foreign estate
--------------------------------------------------------------
                           Street Address
                                                                            Country
                                                                                    ----------------------
                                                                            Passport #
--------------------------------------------------------------                         -------------------
         City              State            Zip Code                        ID #
                                                                                   -------------------------
                                                                            ID Type
                                                                                    ----------------------
Telephone:  (     )
             -----  ------------------------------------------

Fax:  (           )
       -----------  ------------------------------------------

</TABLE>

                                       14
<PAGE>

E-mail:
         --------------------------------------------------------------

Address for Delivery of Units (if different from above):

--------------------------------------------------
         City              State            Zip Code

                                       15
<PAGE>

          THE  SUBSCRIPTION  FOR  UNITS OF  NEOSTEM,  INC.  BY THE  ABOVE  NAMED
INVESTOR(S) IS ACCEPTED THIS ________ DAY OF ______________________, 2007.

                                      NEOSTEM, INC.


                                      By:
                                               ---------------------------------
                                      Name:    Robin L. Smith
                                      Title:   Chairman and CEO



                                      PLACEMENT AGENT:

                                      EMERGING GROWTH EQUITIES, LTD.



                                      By:
                                             -----------------------------------
                                      Name:  Gregory J. Berlacher
                                      Title: President and CEO

                                       16

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.2
<SEQUENCE>3
<FILENAME>a5324274ex10_2.txt
<DESCRIPTION>EXHIBIT 10.2
<TEXT>
                                                                    Exhibit 10.2

                                                                       Exhibit A


THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY OTHER
APPLICABLE SECURITIES LAWS AND HAVE BEEN ISSUED IN RELIANCE UPON AN EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND SUCH OTHER
SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN
MAY BE SOLD, ASSIGNED, TRANSFERRED, ENCUMBERED, OR OTHERWISE DISPOSED OF, EXCEPT
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR AN
OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION
IS NOT REQUIRED.


Warrant No. __________


                   WARRANT TO PURCHASE SHARES OF COMMON STOCK

                                       OF

                                  NEOSTEM, INC.

         THIS CERTIFIES that, for value received,  [______________]  is entitled
to purchase  from NEOSTEM,  INC., a Delaware  corporation  (the  "Corporation"),
subject to the terms and conditions hereof, _______________ shares (the "Warrant
Shares") of common stock,  $.001 par value (the "Common  Stock").  This warrant,
together with all warrants hereafter issued in exchange or substitution for this
warrant,  is  referred  to as the  "Warrant"  and the holder of this  Warrant is
referred  to as the  "Holder."  The  number  of  Warrant  Shares is  subject  to
adjustment as  hereinafter  provided.  Notwithstanding  anything to the contrary
contained  herein,  this  Warrant  shall expire at 5:00 p.m.  (Eastern  Time) on
__________, 2014 (the "Termination Date").

         1. Exercise of Warrants. The Holder may, at any time prior to the
Termination Date, exercise this Warrant in whole or in part at an exercise price
per share equal to $.80 per share, subject to adjustment as provided herein (the
"Exercise Price"), by the surrender of this Warrant (properly endorsed) at the
principal office of the Corporation, or at such other agency or office of the
Corporation in the United States of America as the Corporation may designate by
notice in writing to the Holder at the address of such Holder appearing on the
books of the Corporation, and by payment to the Corporation of the Exercise
Price in lawful money of the United States by check or wire transfer for each
share of Common Stock being purchased. Upon any partial exercise of this
Warrant, there shall be executed and issued to the Holder a new Warrant in
respect of the shares of Common Stock as to which this Warrant shall not have
been exercised. In the event of the exercise of the rights represented by this
Warrant, a certificate or certificates for the Warrant Shares so purchased, as
applicable, registered in the name of the Holder, shall be delivered to the
Holder hereof as soon as practicable after the rights represented by this
Warrant shall have been so exercised.


         2. Reservation of Warrant Shares. The Corporation agrees that, prior to
the expiration of this Warrant, it will at all times have authorized and in
reserve, and will keep available, solely for issuance or delivery upon the
exercise of this Warrant, the number of Warrant Shares as from time to time
shall be issuable by the Corporation upon the exercise of this Warrant.

         3. No Stockholder Rights. This Warrant shall not entitle the holder
hereof to any voting rights or other rights as a stockholder of the Corporation.

         4. Transferability of Warrant. Prior to the Termination Date and
subject to compliance with applicable Federal and State securities and other
laws, this Warrant and all rights hereunder are transferable, in whole or in
part, at the office or agency of the Company by the Holder in person or by duly
authorized attorney, upon surrender of this Warrant together with the Assignment
Form annexed hereto properly endorsed for transfer. Any registration rights to
which this Warrant may then be subject shall be transferred together with the
Warrant to the subsequent Investor.

                                       1
<PAGE>

         5. Certain Adjustments. With respect to any rights that Holder has to
exercise this Warrant and convert into shares of Common Stock, Holder shall be
entitled to the following adjustments:

                  (a) Merger or Consolidation. If at any time there shall be a
merger or a consolidation of the Corporation with or into another entity when
the Corporation is not the surviving corporation, then, as part of such merger
or consolidation, lawful provision shall be made so that the holder hereof shall
thereafter be entitled to receive upon exercise of this Warrant, during the
period specified herein and upon payment of the aggregate Exercise Price then in
effect, the number of shares of stock or other securities or property (including
cash) of the successor corporation resulting from such merger or consolidation,
to which the holder hereof as the holder of the stock deliverable upon exercise
of this Warrant would have been entitled in such merger or consolidation if this
Warrant had been exercised immediately before such transaction. In any such
case, appropriate adjustment shall be made in the application of the provisions
of this Warrant with respect to the rights and interests of the holder hereof as
the holder of this Warrant after the merger or consolidation.

                  (b) Reclassification, Recapitalization, etc. If the
Corporation at any time shall, by subdivision, combination or reclassification
of securities, recapitalization, automatic conversion, or other similar event
affecting the number or character of outstanding shares of Common Stock, or
otherwise, change any of the securities as to which purchase rights under this
Warrant exist into the same or a different number of securities of any other
class or classes, this Warrant shall thereafter represent the right to acquire
such number and kind of securities as would have been issuable as the result of
such change with respect to the securities that were subject to the purchase
rights under this Warrant immediately prior to such subdivision, combination,
reclassification or other change.

                  (c) Split or Combination of Common Stock and Stock Dividend.
In case the Corporation shall at any time subdivide, redivide, recapitalize,
split (forward or reverse) or change its outstanding shares of Common Stock into
a greater number of shares or declare a dividend upon its Common Stock payable
solely in shares of Common Stock, the Exercise Price shall be proportionately
reduced and the number of Warrant Shares proportionately increased. Conversely,
in case the outstanding shares of Common Stock of the Corporation shall be
combined into a smaller number of shares, the Exercise Price shall be
proportionately increased and the number of Warrant Shares proportionately
reduced.

         6. Legend and Stop Transfer Orders. Unless the Warrant Shares have been
registered under the Securities Act, upon exercise of any part of the Warrant,
the Corporation shall instruct its transfer agent to enter stop transfer orders
with respect to such Warrant Shares, and all certificates or instruments
representing the Warrant Shares shall bear on the face thereof substantially the
following legend:

         THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
         UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
         ACT"), OR ANY OTHER APPLICABLE SECURITIES LAWS AND HAVE BEEN ISSUED IN
         RELIANCE UPON AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
         SECURITIES ACT AND SUCH OTHER SECURITIES LAWS. NEITHER THIS SECURITY
         NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE SOLD, ASSIGNED,
         TRANSFERRED, ENCUMBERED, OR OTHERWISE DISPOSED OF, EXCEPT PURSUANT TO
         AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR AN
         OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE CORPORATION THAT SUCH
         REGISTRATION IS NOT REQUIRED.

                                       2
<PAGE>

         7. Redemption of Warrant. This Warrant is subject to redemption by the
Company as provided in this Section 7.

                  (a) This Warrant may be redeemed, at the option of the
Company, in whole and not in part, at a redemption price of $.0001 per Warrant
(the "Redemption Price"), provided (i) the average closing price of the Common
Stock as quoted by Bloomberg, LP., or the Principal Trading Market (as defined
below) on which the Common Stock is included for quotation or trading, shall
equal or exceed $1.60 per share (taking into account all adjustments) for twenty
(20) out of thirty (30) consecutive trading days with an average daily trading
volume of at least 100,000 shares per day; (ii) the Common Stock is either
quoted on the OTC Bulletin Board, traded on a national securities exchange or
quoted on the NASDAQ National Market or NASDAQ Small Cap Market (the "Principal
Trading Market"); and (iii) a the registration statement covering the resale of
the Warrant Shares under the Securities Act has been declared effective by the
Securities and Exchange Commission and remains effective on the Redemption Date
(as defined below) so that the Warrant Shares may be sold without limitation.

                  (b) If the conditions set forth in Section 7(a) are met, and
the Company desires to exercise its right to redeem this Warrant, it shall mail
a notice (the "Redemption Notice") to the registered holder of this Warrant by
first class mail, postage prepaid, at least ten (10) business days prior to the
date fixed by the Company for redemption of the Warrants (the "Redemption
Date").

                  (c ) The Redemption Notice shall specify (i) the Redemption
Price, (ii) the Redemption Date, (iii) the place where the Warrant certificates
shall be delivered and the redemption price paid, and (iv) that the right to
exercise this Warrant shall terminate at 5:00 p.m. (New York time) on the
business day immediately preceding the Redemption Date. No failure to mail such
notice nor any defect therein or in the mailing thereof shall affect the
validity of the proceedings for such redemption except as to a holder (a) to
whom notice was not mailed, or (b) whose notice was defective. An affidavit of
the Secretary or an Assistant Secretary of the Company that the Redemption
Notice has been mailed shall, in the absence of fraud, be prima facie evidence
of the facts stated therein.

                  (d) Any right to exercise a Warrant shall terminate at 5:00
p.m. (New York time) on the business day immediately preceding the Redemption
Date. On and after the Redemption Date, the holder of this Warrant shall have no
further rights except to receive, upon surrender of this Warrant, the Redemption
Price.

                  (e) From and after the Redemption Date, the Company shall, at
the place specified in the Redemption Notice, upon presentation and surrender to
the Company by or on behalf of the holder thereof the warrant certificates
evidencing this Warrant being redeemed, deliver, or cause to be delivered to or
upon the written order of such holder, a sum in cash equal to the Redemption
Price of this Warrant. From and after the Redemption Date, this Warrant shall
expire and become void and all rights hereunder and under the warrant
certificates, except the right to receive payment of the Redemption Price, shall
cease.

         8. Miscellaneous. This Warrant shall be governed by and construed in
accordance with the laws of the State of New York. All the covenants and
provisions of this Warrant by or for the benefit of the Corporation shall bind
and inure to the benefit of its successors and assigns hereunder. Nothing in
this Warrant shall be construed to give to any person or corporation other than
the Corporation and the holder of this Warrant any legal or equitable right,
remedy, or claim under this Warrant. This Warrant shall be for the sole and
exclusive benefit of the Corporation and the Holder. The section headings herein
are for convenience only and are not part of this Warrant and shall not affect
the interpretation hereof. Upon receipt of evidence satisfactory to the
Corporation of the loss, theft, destruction, or mutilation of this Warrant, and
of indemnity reasonably satisfactory to the Corporation, if lost, stolen, or
destroyed, and upon surrender and cancellation of this Warrant, if mutilated,
the Corporation shall execute and deliver to the Holder a new Warrant of like
date, tenor, and denomination.

         IN WITNESS WHEREOF, the Corporation has caused this Warrant to be
executed by its duly authorized officers under its seal, this ___ day of
________ 2007.



                                       3
<PAGE>

                            NEOSTEM, INC.

                            ------------------------------------------------
                            Robin L. Smith, Chairman & & Chief Executive
                            Officer

                                       4
<PAGE>

                              WARRANT EXERCISE FORM

            To Be Executed by the Holder in Order to Exercise Warrant

To:      NeoStem, Inc.                         Dated:  ________________ __, 20__
         420 Lexington Avenue
         Suite 450
         New York, New York  10170
         Attn:  Chairman and CEO

     The undersigned,  pursuant to the provisions set forth in the attached
     Warrant No. ______,  hereby irrevocably elects to purchase ____________
     shares of the Common Stock of NeoStem, Inc. covered by such Warrant.

|_|      The undersigned herewith makes payment of the full purchase price for
         such shares at the price per share provided for in such Warrant. Such
         payment takes the form of $__________ in lawful money of the United
         States.

The undersigned hereby requests that certificates for the Warrant Shares
purchased hereby be issued in the name of:


---------------------------------------
---------------------------------------
(please print or type name and address)

-----------------------------------------------------------
(please insert social security or other identifying number)

and be delivered as follows:

---------------------------------------
---------------------------------------
(please print or type name and address)

----------------------------------------------------------
(please insert social security or other identifying number)

and if such number of shares of Common Stock shall not be all the shares
evidenced by this Warrant Certificate, that a new Warrant for the balance of
such shares be registered in the name of, and delivered to, Holder.


                                      ------------------------------------------
                                      Signature of Holder

                                      SIGNATURE GUARANTEE:

                                      ------------------------------------------

                                       5
<PAGE>

                                 ASSIGNMENT FORM

                    (To assign the foregoing warrant, execute
            this form. Do not use this form to exercise the warrant.)

         FOR VALUE  RECEIVED,  the  foregoing  Warrant and all rights  evidenced
thereby are hereby assigned to


                                                                   whose address
--------------------------------------------------------------------------------
is
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------





                                                       Dated:  ________ __, 200_


                                    Holder's Signature:
                                                        ------------------------

                                    Holder's Address:
                                                        ------------------------




Signature Guaranteed:
                           --------------------------------------------





NOTE: The signature to this Assignment Form must correspond with the name as it
appears on the face of the Warrant, without alteration or enlargement or any
change whatsoever, and must be guaranteed by a bank or trust Corporation.
Officers of corporations and those acting in a fiduciary or other representative
capacity should file proper evidence of authority to assign the foregoing
Warrant.

                                       6

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.3
<SEQUENCE>4
<FILENAME>a5324274ex10_3.txt
<DESCRIPTION>EXHIBIT 10.3
<TEXT>
                                                                    Exhibit 10.3

                                                                     Exhibit A-1


THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY OTHER
APPLICABLE SECURITIES LAWS AND HAVE BEEN ISSUED IN RELIANCE UPON AN EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND SUCH OTHER
SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN
MAY BE SOLD, ASSIGNED, TRANSFERRED, ENCUMBERED, OR OTHERWISE DISPOSED OF, EXCEPT
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR AN
OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION
IS NOT REQUIRED.


Warrant No. __________


                   WARRANT TO PURCHASE SHARES OF COMMON STOCK

                                       OF

                                  NEOSTEM, INC.

         THIS CERTIFIES that, for value received,  [______________]  is entitled
to purchase  from NEOSTEM,  INC., a Delaware  corporation  (the  "Corporation"),
subject to the terms and conditions hereof, _______________ shares (the "Warrant
Shares") of common stock,  $.001 par value (the "Common  Stock").  This warrant,
together with all warrants hereafter issued in exchange or substitution for this
warrant,  is  referred  to as the  "Warrant"  and the holder of this  Warrant is
referred  to as the  "Holder."  The  number  of  Warrant  Shares is  subject  to
adjustment as  hereinafter  provided.  Notwithstanding  anything to the contrary
contained  herein,  this  Warrant  shall expire at 5:00 p.m.  (Eastern  Time) on
__________, 2014 (the "Termination Date").

         1. Exercise of Warrants. The Holder may, at any time prior to the
Termination Date, exercise this Warrant in whole or in part at an exercise price
per share equal to $.80 per share, subject to adjustment as provided herein (the
"Exercise Price"), by the surrender of this Warrant (properly endorsed) at the
principal office of the Corporation, or at such other agency or office of the
Corporation in the United States of America as the Corporation may designate by
notice in writing to the Holder at the address of such Holder appearing on the
books of the Corporation, and by payment to the Corporation of the Exercise
Price in lawful money of the United States by check or wire transfer for each
share of Common Stock being purchased. Upon any partial exercise of this
Warrant, there shall be executed and issued to the Holder a new Warrant in
respect of the shares of Common Stock as to which this Warrant shall not have
been exercised. In the event of the exercise of the rights represented by this
Warrant, a certificate or certificates for the Warrant Shares so purchased, as
applicable, registered in the name of the Holder, shall be delivered to the
Holder hereof as soon as practicable after the rights represented by this
Warrant shall have been so exercised.


         2. Reservation of Warrant Shares. The Corporation agrees that, prior to
the expiration of this Warrant, it will at all times have authorized and in
reserve, and will keep available, solely for issuance or delivery upon the
exercise of this Warrant, the number of Warrant Shares as from time to time
shall be issuable by the Corporation upon the exercise of this Warrant.

         3. No Stockholder Rights. This Warrant shall not entitle the holder
hereof to any voting rights or other rights as a stockholder of the Corporation.

         4. Transferability of Warrant. Prior to the Termination Date and
subject to compliance with applicable Federal and State securities and other
laws, this Warrant and all rights hereunder are transferable, in whole or in
part, at the office or agency of the Company by the Holder in person or by duly
authorized attorney, upon surrender of this Warrant together with the Assignment
Form annexed hereto properly endorsed for transfer. Any registration rights to
which this Warrant may then be subject shall be transferred together with the
Warrant to the subsequent Investor.

                                       1
<PAGE>

         5. Certain Adjustments. With respect to any rights that Holder has to
exercise this Warrant and convert into shares of Common Stock, Holder shall be
entitled to the following adjustments:

                  (a) Merger or Consolidation. If at any time there shall be a
merger or a consolidation of the Corporation with or into another entity when
the Corporation is not the surviving corporation, then, as part of such merger
or consolidation, lawful provision shall be made so that the holder hereof shall
thereafter be entitled to receive upon exercise of this Warrant, during the
period specified herein and upon payment of the aggregate Exercise Price then in
effect, the number of shares of stock or other securities or property (including
cash) of the successor corporation resulting from such merger or consolidation,
to which the holder hereof as the holder of the stock deliverable upon exercise
of this Warrant would have been entitled in such merger or consolidation if this
Warrant had been exercised immediately before such transaction. In any such
case, appropriate adjustment shall be made in the application of the provisions
of this Warrant with respect to the rights and interests of the holder hereof as
the holder of this Warrant after the merger or consolidation.

                  (b) Reclassification, Recapitalization, etc. If the
Corporation at any time shall, by subdivision, combination or reclassification
of securities, recapitalization, automatic conversion, or other similar event
affecting the number or character of outstanding shares of Common Stock, or
otherwise, change any of the securities as to which purchase rights under this
Warrant exist into the same or a different number of securities of any other
class or classes, this Warrant shall thereafter represent the right to acquire
such number and kind of securities as would have been issuable as the result of
such change with respect to the securities that were subject to the purchase
rights under this Warrant immediately prior to such subdivision, combination,
reclassification or other change.

                  (c) Split or Combination of Common Stock and Stock Dividend.
In case the Corporation shall at any time subdivide, redivide, recapitalize,
split (forward or reverse) or change its outstanding shares of Common Stock into
a greater number of shares or declare a dividend upon its Common Stock payable
solely in shares of Common Stock, the Exercise Price shall be proportionately
reduced and the number of Warrant Shares proportionately increased. Conversely,
in case the outstanding shares of Common Stock of the Corporation shall be
combined into a smaller number of shares, the Exercise Price shall be
proportionately increased and the number of Warrant Shares proportionately
reduced.

         6. Legend and Stop Transfer Orders. Unless the Warrant Shares have been
registered under the Securities Act, upon exercise of any part of the Warrant,
the Corporation shall instruct its transfer agent to enter stop transfer orders
with respect to such Warrant Shares, and all certificates or instruments
representing the Warrant Shares shall bear on the face thereof substantially the
following legend:

         THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
         UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
         ACT"), OR ANY OTHER APPLICABLE SECURITIES LAWS AND HAVE BEEN ISSUED IN
         RELIANCE UPON AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
         SECURITIES ACT AND SUCH OTHER SECURITIES LAWS. NEITHER THIS SECURITY
         NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE SOLD, ASSIGNED,
         TRANSFERRED, ENCUMBERED, OR OTHERWISE DISPOSED OF, EXCEPT PURSUANT TO
         AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR AN
         OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE CORPORATION THAT SUCH
         REGISTRATION IS NOT REQUIRED.

                                       2
<PAGE>

         7. Miscellaneous. This Warrant shall be governed by and construed in
accordance with the laws of the State of New York. All the covenants and
provisions of this Warrant by or for the benefit of the Corporation shall bind
and inure to the benefit of its successors and assigns hereunder. Nothing in
this Warrant shall be construed to give to any person or corporation other than
the Corporation and the holder of this Warrant any legal or equitable right,
remedy, or claim under this Warrant. This Warrant shall be for the sole and
exclusive benefit of the Corporation and the Holder. The section headings herein
are for convenience only and are not part of this Warrant and shall not affect
the interpretation hereof. Upon receipt of evidence satisfactory to the
Corporation of the loss, theft, destruction, or mutilation of this Warrant, and
of indemnity reasonably satisfactory to the Corporation, if lost, stolen, or
destroyed, and upon surrender and cancellation of this Warrant, if mutilated,
the Corporation shall execute and deliver to the Holder a new Warrant of like
date, tenor, and denomination.

         IN WITNESS WHEREOF, the Corporation has caused this Warrant to be
executed by its duly authorized officers under its seal, this ___ day of
________ 2007.

                                   NEOSTEM, INC.

                                   --------------------------------------------
                                   Robin L. Smith, Chairman & & Chief Executive
                                   Officer

                                       3
<PAGE>

                              WARRANT EXERCISE FORM

            To Be Executed by the Holder in Order to Exercise Warrant

To:      NeoStem, Inc.                         Dated:  ________________ __, 20__
         420 Lexington Avenue
         Suite 450
         New York, New York  10170
         Attn:  Chairman and CEO

     The undersigned,  pursuant to the provisions set forth in the attached
     Warrant No. ______,  hereby irrevocably elects to purchase ____________
     shares of the Common Stock of NeoStem, Inc. covered by such Warrant.

|_|      The undersigned herewith makes payment of the full purchase price for
         such shares at the price per share provided for in such Warrant. Such
         payment takes the form of $__________ in lawful money of the United
         States.

The undersigned hereby requests that certificates for the Warrant Shares
purchased hereby be issued in the name of:

---------------------------------------

---------------------------------------
(please print or type name and address)

----------------------------------------------------------
(please insert social security or other identifying number)

and be delivered as follows:

---------------------------------------

---------------------------------------
(please print or type name and address)

----------------------------------------------------------
(please insert social security or other identifying number)

and if such number of shares of Common Stock shall not be all the shares
evidenced by this Warrant Certificate, that a new Warrant for the balance of
such shares be registered in the name of, and delivered to, Holder.


                                      -----------------------------------
                                      Signature of Holder

                                      SIGNATURE GUARANTEE:

                                      -----------------------------------

                                       4
<PAGE>

                                 ASSIGNMENT FORM

                    (To assign the foregoing warrant, execute
            this form. Do not use this form to exercise the warrant.)



         FOR VALUE  RECEIVED,  the  foregoing  Warrant and all rights  evidenced
thereby are hereby assigned to


                                                                   whose address
--------------------------------------------------------------------------------
is
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------




                                                       Dated:  ________ __, 200_


                                    Holder's Signature:
                                                        ------------------------

                                    Holder's Address:
                                                        ------------------------






Signature Guaranteed:
                           --------------------------------------------


NOTE: The signature to this Assignment Form must correspond with the name as it
appears on the face of the Warrant, without alteration or enlargement or any
change whatsoever, and must be guaranteed by a bank or trust Corporation.
Officers of corporations and those acting in a fiduciary or other representative
capacity should file proper evidence of authority to assign the foregoing
Warrant.

                                       5
</TEXT>
</DOCUMENT>
</SUBMISSION>
