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<SEC-DOCUMENT>0001178913-09-001011.txt : 20090506
<SEC-HEADER>0001178913-09-001011.hdr.sgml : 20090506
<ACCEPTANCE-DATETIME>20090506104334
ACCESSION NUMBER:		0001178913-09-001011
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		6
CONFORMED PERIOD OF REPORT:	20090506
ITEM INFORMATION:		Entry into a Material Definitive Agreement
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20090506
DATE AS OF CHANGE:		20090506

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			PLURISTEM THERAPEUTICS INC
		CENTRAL INDEX KEY:			0001158780
		STANDARD INDUSTRIAL CLASSIFICATION:	BIOLOGICAL PRODUCTS (NO DIAGNOSTIC SUBSTANCES) [2836]
		IRS NUMBER:				980351734
		STATE OF INCORPORATION:			NV
		FISCAL YEAR END:			0630

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-31392
		FILM NUMBER:		09800048

	BUSINESS ADDRESS:	
		STREET 1:		MATAM ADVANCED TECHNOLOGY PARK
		STREET 2:		BUILDING NO. 20
		CITY:			HAIFA
		STATE:			L3
		ZIP:			31905
		BUSINESS PHONE:		972-4-850-1080

	MAIL ADDRESS:	
		STREET 1:		MATAM ADVANCED TECHNOLOGY PARK
		STREET 2:		BUILDING NO. 20
		CITY:			HAIFA
		STATE:			L3
		ZIP:			31905

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	PLURISTEM LIFE SYSTEMS INC
		DATE OF NAME CHANGE:	20030701

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	AI SOFTWARE INC
		DATE OF NAME CHANGE:	20010906
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>zk96706.htm
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     <!-- Control Number: 96706                                                            -->
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     <!-- Client Name:    Pluristem Therapeutics Inc                                       -->
     <!-- Project Name:   8-K                                                              -->
     <!-- Firm Name:      Zadok-Keinan Ltd                                                 -->
     <TITLE>8-K</TITLE>
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<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=3>UNITED STATES </FONT><BR>
<FONT FACE="Times New Roman, Times, Serif" SIZE=4>SECURITIES AND
EXCHANGE COMMISSION </FONT><BR>
<FONT FACE="Times New Roman, Times, Serif" SIZE=2>Washington, DC 20549 </FONT></H1>

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<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=4>Form&nbsp;8-K </FONT></H1>

<P align=center><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>Current Report
<BR>Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934</B> </FONT></P>



<P align=center><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Date of report (Date of earliest event reported): <B>May 6, 2009 (May 5, 2009)</B> </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="5"><B>PLURISTEM THERAPEUTICS
INC.</B> </FONT> <BR>
<FONT FACE="Times New Roman, Times, Serif" SIZE="2">(Exact
name of registrant as specified in its charter) </FONT> </P>

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<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
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     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=33% ALIGN=CENTER><FONT FACE="Times New Roman" SIZE="2"><B>Nevada</B> </FONT></TD>
     <TD WIDTH=34% ALIGN=CENTER><FONT FACE="Times New Roman" SIZE="2"><B>001-31392</B> </FONT></TD>
     <TD WIDTH=33% ALIGN=CENTER><FONT FACE="Times New Roman" SIZE="2"><B>98-0351734</B> </FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=CENTER><FONT FACE="Times New Roman" SIZE=2>(State or other jurisdiction of incorporation)</FONT></TD>
     <TD ALIGN=CENTER><FONT FACE="Times New Roman" SIZE=2>(Commission file number)</FONT></TD>
     <TD ALIGN=CENTER><FONT FACE="Times New Roman" SIZE=2>(I.R.S. Employer Identification Number)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=CENTER><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=CENTER><FONT FACE="Times New Roman" SIZE="2"><B>MATAM Advanced Technology Park</B> </FONT></TD>
     <TD ALIGN=CENTER><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=CENTER><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=CENTER><FONT FACE="Times New Roman" SIZE="2"><B>Building No. 20</B> </FONT></TD>
     <TD ALIGN=CENTER><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=CENTER><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=CENTER><FONT FACE="Times New Roman" SIZE="2"><B>Haifa, Israel</B> </FONT></TD>
     <TD ALIGN=CENTER><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=CENTER><FONT FACE="Times New Roman" SIZE="2"><B>31905</B> </FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=CENTER><FONT FACE="Times New Roman" SIZE=2>(Address of principal executive offices)</FONT></TD>
     <TD ALIGN=CENTER><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=CENTER><FONT FACE="Times New Roman" SIZE=2>(Zip Code)</FONT></TD></TR>
</TABLE>
<BR>


<P align=center><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Registrant's telephone number, including area code: <B>011 972 74 710 7171</B> </FONT></P>


<P align=center><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>n/a
</B><BR>(Former name or former address, if changed since last report) </FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Check
the appropriate box below if the Form&nbsp;8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following provisions: </FONT></P>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     <FONT size="3" face="Wingdings">o
</font> </FONT></TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)</FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     <FONT size="3" face="Wingdings">o
</font> </FONT></TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)</FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     <FONT size="3" face="Wingdings">o
</font></FONT></TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
          240.14d-2(b))</FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>     <FONT size="3" face="Wingdings">o
</font> </FONT></TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
          240.13e-4(c))</FONT></TD>
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<BR>

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<font size=2></font></p>
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<TD WIDTH=9%><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>Item 1.01</B> </FONT> </TD>
<TD WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B></B> </FONT></TD>
<TD WIDTH=88%><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B> Entry
into a Material Definitive Agreement</B> </FONT> </TD>
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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
May 5, 2009, we entered into securities purchase agreements with two investors pursuant to
which the investors agreed to purchase 888,406 shares of our common stock (&#147;Common
Stock&#148;) and warrants (&#147;Warrants&#148;) to purchase 488,623 shares of Common
Stock (the Warrants together with the Common Stock, the &#147;Units&#148;). The price per
Unit is $1.50, and the exercise price of the Warrants is $1.96. The Warrants will be
exercisable for a period of five years commencing six months following the issuance
thereof. The closing is scheduled to take place no later than May 8, 2008. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
copy of the form of Warrant is attached as Exhibit 4.1 to this report and is incorporated
herein by reference. The description of the Warrants is a summary only and is qualified
in its entirety by reference to Exhibit 4.1. A copy of the form of securities purchase
agreement is attached as Exhibit 10.1 to this report and is incorporated herein by
reference.  </FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Rodman
&amp; Renshaw, LLC acted as placement agent, on a best efforts basis, for the offering
and will receive a placement fee equal to 6% of the gross purchase price of the Units
(excluding any consideration that may be paid in the future upon exercise of the
Warrants) as well as warrants to purchase 53,304 shares of Common Stock at an exercise
price of $1.875 per share. Subject to FINRA Rule 2710, the placement agent warrants may
be exercised after six months through and including May 5, 2014. A copy of the Placement
Agency Agreement is attached as Exhibit 1.1 to this report and is incorporated herein by
reference.  </FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
offering was made pursuant to our shelf registration statement on Form S-3 (File No.
333-151761). We are filing with the SEC, pursuant to Rule 424(b) under the Securities Act
of 1933, as amended, a prospectus supplement and base prospectus related to the offering.  </FONT></P>


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<TD WIDTH=9%><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>Item 9.01</B> </FONT> </TD>
<TD WIDTH=3%><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B></B> </FONT></TD>
<TD WIDTH=88%><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>
Financial Statements and Exhibits</B> </FONT> </TD>
</TR>
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<BR>

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<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(d) Exhibits: </FONT></H1>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.1  </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Placement
Agency Agreement, dated March 2, 2009, by and between the registrant and Rodman &amp; Renshaw,
              LLC.</FONT></TD>
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<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4.1  </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Form
of Common Stock Purchase Warrant dated May 5, 2009</FONT></TD>
</TR>
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<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5.1  </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Opinion
of Zysman, Aharoni, Gayer &amp; Co./ Sullivan &amp; Worcester LLP</FONT></TD>
</TR>
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<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10.1  </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Form
of Securities Purchase Agreement dated May 5, 2009</FONT></TD>
</TR>
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<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>23.1  </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Consent
of Zysman, Aharoni, Gayer &amp; Co./ Sullivan &amp; Worcester LLP (included in Exhibit 5.1).</FONT></TD>
</TR>
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<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>SIGNATURES </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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. </FONT></P>


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<TD WIDTH=40%><FONT FACE="Times New Roman, Times, Serif" SIZE=2><BR><BR><BR>Date: May 6, 2009  </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD WIDTH=50%><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>PLURISTEM THERAPEUTICS INC.</B><BR><BR>
<BR>By: /s/ Yaky Yanay<BR>&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;<BR>
 Yaky Yanay<BR>Chief Financial Officer</FONT></TD>
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     <!-- Control Number: 96706                                                            -->
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     <!-- Project Name:   8-K                                                              -->
     <!-- Firm Name:      Zadok-Keinan Ltd                                                 -->
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<H1 ALIGN=right><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U><B>Exhibit 1.1</B></U> </FONT> </H1>

<P align=center><FONT FACE="Times New Roman, Times, Serif" SIZE=2><IMG SRC="rod.jpg"></FONT></P>

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<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2> March 2, 2009
 </FONT></P>

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<H1 ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>CONFIDENTIAL</U> </FONT> </H1>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Yaky Yanay
<BR>Chief Financial Officer
<BR>Pluristem Therapeutics Inc.
<BR>MATAM Advanced Technology Park # 20
<BR>Haifa 31905, Israel
</FONT></P>

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<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Dear Mr. Yanay: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE="2">This letter (the
&#147;<U>Agreement</U>&#148;) constitutes the agreement between Rodman &amp; Renshaw, LLC
(&#147;<U>Rodman</U>&#148; or the &#147;<U>Placement Agent</U>&#148;) and Pluristem
Therapeutics Inc. (the &#147;<U>Company</U>&#148;), that Rodman shall serve as the
exclusive placement agent for the Company, on a &#147;reasonable best efforts&#148; basis,
in connection with the proposed placement (the &#147;<U>Placement</U>&#148;) of registered
securities (the &#147;<U>Securities</U>&#148;) of the Company, including shares (the
&#147;<U>Shares</U>&#148;) of the Company&#146;s common stock, par value $0.00001 per
share (the &#147;<U>Common Stock</U>&#148;) and warrants to purchase shares of Common
Stock. The terms of such Placement and the Securities shall be mutually agreed upon by the
Company and the purchasers (each, a &#147;<U>Purchaser</U>&#148; and collectively, the
&#147;<U>Purchasers</U>&#148;) and nothing herein constitutes that Rodman would have the
power or authority to bind the Company or any Purchaser or an obligation for the Company
to issue any Securities or complete the Placement. This Agreement and the documents
executed and delivered by the Company and the Purchasers in connection with the Placement
shall be collectively referred to herein as the &#147;<U>Transaction Documents</U>.&#148;
The date of the closing of the Placement shall be referred to herein as the
&#147;<U>Closing Date</U>.&#148; The Company expressly acknowledges and agrees that
Rodman&#146;s obligations hereunder are on a reasonable best efforts basis only and that
the execution of this Agreement does not constitute a commitment by Rodman to purchase the
Securities and does not ensure the successful placement of the Securities or any portion
thereof or the success of Rodman with respect to securing any other financing on behalf of
the Company. </FONT> </P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>SECTION 1.</u> &nbsp;&nbsp;<u> Compensation
and other Fees.</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
compensation for the services provided by Rodman hereunder the Company agrees to pay to
Rodman: </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(A)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The fees set forth below with respect to the Placement: </FONT></P>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
               <TR VALIGN=TOP>
               <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
               <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>a) </FONT></TD>
               <TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
               A cash fee payable immediately upon the closing of the Placement and equal to 6%
               of the aggregate gross proceeds raised in the Placement. </FONT></TD>
               </TR>
               </TABLE>
               <BR>

<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px"><HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<page>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>b) </FONT></TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Warrants
to purchase that number of shares of Common Stock equal to 6% of the
                    aggregate number of Shares sold in the Placement, plus any Shares
underlying any                     convertible Securities or units sold in the Placement.
Such warrants shall have                     the same terms as the warrants (if any)
issued to the Purchasers in the                     Placement except that such warrants
shall have an exercise price equal to 125%                     of the purchase price per
share in the Offering and shall not be transferable                     except as
permitted by NASD Rule 2710. </FONT></TD>
</TR>
</TABLE>
<BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(B) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company also agrees to reimburse Rodman&#146;s expenses up to a maximum of
          0.8% of gross Offering proceeds, but in no event more than $15,000. Such
          reimbursement shall be payable immediately upon (but only in the event of) the
          closing of the Placement. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(C) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;It
is agreed and acknowledged that no fees, whether for services, reimbursement
                    or otherwise, shall be due and payable and no warrants issued if no
funds were                     raised in the Placement as described in Section (A) above.  </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>SECTION 2.</u> &nbsp;&nbsp;<u>REGISTRATION
STATEMENT.</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Company represents and warrants
to, and agrees with, the Placement Agent that: </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(A)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Company has filed with the Securities and Exchange Commission (the
          &#147;Commission&#148;) a registration statement on Form S-3 (Registration File
          No. 333-151761) under the Securities Act of 1933, as amended (the
          &#147;Securities Act&#148;), which became effective on July 1, 2008, for the
          registration under the Securities Act of the Shares. At the time of such filing,
          the Company met the requirements of Form S-3 under the Securities Act. Such
          registration statement meets the requirements set forth in Rule 415(a)(1)(x)
          under the Securities Act and complies with said Rule. The Company will file with
          the Commission pursuant to Rule 424(b) under the Securities Act, and the rules
          and regulations (the &#147;Rules and Regulations&#148;) of the Commission
          promulgated thereunder, a supplement to the form of prospectus included in such
          registration statement relating to the placement of the Shares and the plan of
          distribution thereof and has advised the Placement Agent of all further
          information (financial and other) with respect to the Company required to be set
          forth therein. Such registration statement, including the exhibits thereto, as
          amended at the date of this Agreement, is hereinafter called the
          &#147;Registration Statement&#148;; such prospectus in the form in which it
          appears in the Registration Statement is hereinafter called the &#147;Base
          Prospectus&#148;; and the supplemented form of prospectus, in the form in which
          it will be filed with the Commission pursuant to Rule 424(b) (including the Base
          Prospectus as so supplemented) is hereinafter called the &#147;Prospectus
          Supplement.&#148; Any reference in this Agreement to the Registration Statement,
          the Base Prospectus or the Prospectus Supplement shall be deemed to refer to and
          include the documents incorporated by reference therein (the &#147;Incorporated
          Documents&#148;) pursuant to Item 12 of Form S-3 which were filed under the
          Securities Exchange Act of 1934, as amended (the &#147;Exchange Act&#148;), on
          or before the date of this Agreement, or the issue date of the Base Prospectus
          or the Prospectus Supplement, as the case may be; and any reference in this
          Agreement to the terms &#147;amend,&#148; &#147;amendment&#148; or
          &#147;supplement&#148; with respect to the Registration Statement, the Base
          Prospectus or the Prospectus Supplement shall be deemed to refer to and include
          the filing of any document under the Exchange Act after the date of this
          Agreement, or the issue date of the Base Prospectus or the Prospectus
          Supplement, as the case may be, deemed to be incorporated therein by reference.
          All references in this Agreement to financial statements and schedules and other
          information which is &#147;contained,&#148; &#147;included,&#148;
          &#147;described,&#148; &#147;referenced,&#148; &#147;set forth&#148; or
          &#147;stated&#148; in the Registration Statement, the Base Prospectus or the
          Prospectus Supplement (and all other references of like import) shall be deemed
          to mean and include all such financial statements and schedules and other
          information which is or is deemed to be incorporated by reference in the
          Registration Statement, the Base Prospectus or the Prospectus Supplement, as the
          case may be. No stop order suspending the effectiveness of the Registration
          Statement or the use of the Base Prospectus or the Prospectus Supplement has
          been issued, and no proceeding for any such purpose is pending or has been
          initiated or, to the Company&#146;s knowledge, is threatened by the Commission.
          For purposes of this Agreement, &#147;free writing prospectus&#148; has the
          meaning set forth in Rule 405 under the Securities Act and the &#147;Time of
          Sale Prospectus&#148; means the preliminary prospectus, if any, together with
          the free writing prospectuses, if any, used in connection with the Placement,
          including any documents incorporated by reference therein. </FONT></P>


<p align=center>
<font size=2>Page 2</font></p>
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<page>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(B)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Registration Statement (and any further documents to be filed with the
          Commission) contains all exhibits and schedules as required by the Securities
          Act. Each of the Registration Statement and any post-effective amendment
          thereto, at the time it became effective, complied in all material respects with
          the Securities Act and the Exchange Act and the applicable Rules and Regulations
          and did not and, as amended or supplemented, if applicable, will not, contain
          any untrue statement of a material fact or omit to state a material fact
          required to be stated therein or necessary to make the statements therein not
          misleading. The Base Prospectus, the Time of Sale Prospectus, if any, and the
          Prospectus Supplement, each as of its respective date, comply in all material
          respects with the Securities Act and the Exchange Act and the applicable Rules
          and Regulations. Each of the Base Prospectus, the Time of Sale Prospectus, if
          any, and the Prospectus Supplement, as amended or supplemented, did not and will
          not contain as of the date thereof any untrue statement of a material fact or
          omit to state a material fact necessary in order to make the statements therein,
          in light of the circumstances under which they were made, not misleading. The
          Incorporated Documents, when they were filed with the Commission, conformed in
          all material respects to the requirements of the Exchange Act and the applicable
          Rules and Regulations, and none of such documents, when they were filed with the
          Commission, contained any untrue statement of a material fact or omitted to
          state a material fact necessary to make the statements therein (with respect to
          Incorporated Documents incorporated by reference in the Base Prospectus or
          Prospectus Supplement), in light of the circumstances under which they were made
          not misleading; and any further documents so filed and incorporated by reference
          in the Base Prospectus, the Time of Sale Prospectus, if any, or Prospectus
          Supplement, when such documents are filed with the Commission, will conform in
          all material respects to the requirements of the Exchange Act and the applicable
          Rules and Regulations, as applicable, and will not contain any untrue statement
          of a material fact or omit to state a material fact necessary to make the
          statements therein, in light of the circumstances under which they were made,
          not misleading. No post-effective amendment to the Registration Statement
          reflecting any facts or events arising after the date thereof which represent,
          individually or in the aggregate, a fundamental change in the information set
          forth therein is required to be filed with the Commission. There are no
          documents required to be filed with the Commission in connection with the
          transaction contemplated hereby that (x) have not been filed as required
          pursuant to the Securities Act or (y) will not be filed within the requisite
          time period. There are no contracts or other documents required to be described
          in the Base Prospectus, the Time of Sale Prospectus, if any, or Prospectus
          Supplement, or to be filed as exhibits or schedules to the Registration
          Statement, which have not been described or filed as required. </FONT></P>


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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(C)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Company is eligible to use free writing prospectuses in connection with the
          Placement pursuant to Rules 164 and 433 under the Securities Act. Any free
          writing prospectus that the Company is required to file pursuant to Rule 433(d)
          under the Securities Act has been, or will be, filed with the Commission in
          accordance with the requirements of the Securities Act and the applicable rules
          and regulations of the Commission thereunder. Each free writing prospectus that
          the Company has filed, or is required to file, pursuant to Rule 433(d) under the
          Securities Act or that was prepared by or behalf of or used by the Company
          complies or will comply in all material respects with the requirements of the
          Securities Act and the applicable rules and regulations of the Commission
          thereunder. The Company will not, without the prior consent of the Placement
          Agent, prepare, use or refer to, any free writing prospectus. </FONT></P>

<p align=center>
<font size=2>Page 3</font></p>
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<page>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(D)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Company has delivered, or will as promptly as practicable deliver, to the
          Placement Agent complete conformed copies of the Registration Statement and of
          each consent and certificate of experts, as applicable, filed as a part thereof,
          and conformed copies of the Registration Statement (without exhibits), the Base
          Prospectus, the Time of Sale Prospectus, if any, and the Prospectus Supplement,
          as amended or supplemented, in such quantities and at such places as the
          Placement Agent reasonably requests. Neither the Company nor any of its
          directors and officers has distributed and none of them will distribute, prior
          to the Closing Date, any offering material in connection with the offering and
          sale of the Shares other than the Base Prospectus, the Time of Sale Prospectus,
          if any, the Prospectus Supplement, the Registration Statement, copies of the
          documents incorporated by reference therein and any other materials permitted by
          the Securities Act. </FONT></P>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>SECTION 3.</u> &nbsp;&nbsp;<u>REPRESENTATIONS
AND WARRANTIES.</U> Except as set forth under the corresponding section of the Disclosure
Schedules which Disclosure Schedules shall be deemed a part hereof, the Company hereby
makes the representations and warranties set forth below to the Placement Agent.  </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- TNR" FSL="Workstation" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;(A)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<U>Organization and Qualification</U>. All of the direct and indirect
subsidiaries (individually, a &#147;<U>Subsidiary</U>&#148;) of the Company are
set forth on <U>Schedule 3(A)</U>. The Company owns, directly or indirectly, all
of the capital stock or other equity interests of each Subsidiary free and clear
of any &#147;<U>Liens</U>&#148; (which for purposes of this Agreement shall mean
a lien, charge, security interest, encumbrance, right of first refusal,
preemptive right or other restriction), and all the issued and outstanding
shares of capital stock of each Subsidiary are validly issued and are fully
paid, non-assessable and free of preemptive and similar rights to subscribe for
or purchase securities. The Company and each of the Subsidiaries is an entity
duly incorporated or otherwise organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation or organization (as
applicable), 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, could not have or reasonably be expected to result in (i) a
material adverse effect on the legality, validity or enforceability of any
Transaction Document, (ii) a material adverse effect on the results of
operations, assets, business, prospects or condition (financial or otherwise) of
the Company and the Subsidiaries, taken as a whole, or (iii) a material adverse
effect on the Company&#146;s ability to perform in any material respect on a
timely basis its obligations under any Transaction Document (any of (i), (ii) or
(iii), a &#147;<U>Material Adverse Effect</U>&#148;) and, to the Company&#146;s
knowledge, no &#147;<U>Proceeding</U>&#148; (which for purposes of this Agreement shall
mean any action, claim, suit, investigation or proceeding (including, without
limitation, an investigation or partial proceeding, such as a deposition),
whether commenced or threatened) has been instituted in any such jurisdiction
revoking, limiting or curtailing or seeking to revoke, limit or curtail such
power and authority or qualification. </FONT> </P>

<p align=center>
<font size=2>Page 4</font></p>
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<page>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(B)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Authorization; Enforcement</U>. The Company has, or will have at Closing, the
          requisite corporate power and authority to enter into and to consummate the
          transactions contemplated by each of the Transaction Documents and otherwise to
          carry out its obligations hereunder and thereunder. The execution and delivery
          of each of the Transaction Documents by the Company and the consummation by it
          of the transactions contemplated thereby have been, or will be prior to Closing,
          duly authorized by all necessary action on the part of the Company and no
          further action is required by the Company, its board of directors or its
          stockholders in connection therewith other than in connection with the
          &#147;<U>Required Approvals</U>&#148; (as defined in subsection 3(D) below).
          Each Transaction Document has been (or upon delivery will have been) duly
          executed by the Company and, when delivered in accordance with the terms hereof
          and thereof, duly signed and delivered by all other parties, 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&#146; rights generally and (ii) as limited by
          laws relating to the availability of specific performance, injunctive relief or
          other equitable remedies. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(C)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>No Conflicts</U>. The execution, delivery and performance of the Transaction
          Documents by the Company, the issuance and sale of the Securities and the
          consummation by the Company of the other transactions contemplated hereby and
          thereby do not and will not (i) conflict with or violate any provision of the
          Company&#146;s or any Subsidiary&#146;s certificate or articles of
          incorporation, bylaws or other organizational or charter documents, or (ii)
          except as provided in <U>Schedule 3(c)(ii)</U>, conflict with, or constitute a
          default (or an event that with notice or lapse of time or both would become a
          default) under, result in the creation of any Lien upon any of the properties or
          assets of the Company or any Subsidiary, 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 a Company or Subsidiary debt or otherwise) or other
          understanding to which the Company or any Subsidiary is a party or by which any
          property or asset of the Company or any Subsidiary is bound or affected, or
          (iii) subject to the Required Approvals, conflict with or result in a violation
          of any law, rule, regulation, order, judgment, injunction, decree or other
          restriction of any court or governmental authority to which the Company or a
          Subsidiary is subject (including federal and state securities laws and
          regulations), or by which any property or asset of the Company or a Subsidiary
          is bound or affected; except in the case of each of clauses (ii) and (iii), such
          as could not have or reasonably be expected to result in a Material Adverse
          Effect. </FONT></P>



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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(D)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Filings, Consents and Approvals</U>. The Company is not 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 &#147;<U>Person</U>&#148; (defined as an
          individual or corporation, partnership, trust, incorporated or unincorporated
          association, joint venture, limited liability company, joint stock company,
          government (or an agency or subdivision thereof) or other entity of any kind,
          including, without limitation, any Trading Market) in connection with the
          execution, delivery and performance by the Company of the Transaction Documents,
          other than such filings as are required to be made under applicable Federal and
          state securities laws (collectively, the &#147;<U>Required Approvals</U>&#148;). </FONT></P>

<p align=center>
<font size=2>Page 5</font></p>
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<page>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(E)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Issuance of the Securities; Registration</U>. The Securities are duly
          authorized and, when issued and paid for in accordance with the applicable
          Transaction Documents, will be duly and validly issued, fully paid and
          nonassessable, free and clear of all Liens imposed by the Company other than
          restrictions on transfer provided for in the Transaction Documents. The Company
          has reserved from its duly authorized capital stock the maximum number of shares
          of Common Stock issuable pursuant to the Transaction Documents. The issuance by
          the Company of the Securities has been registered under the Securities Act and
          all of the Securities are freely transferable and tradable by the Purchasers
          without restriction (other than any restrictions arising solely from an act or
          omission of a Purchaser). The Securities will be issued pursuant to the
          Registration Statement and the issuance of the Securities has been registered by
          the Company under the Securities Act. The Registration Statement is effective
          and available for the issuance of the Securities thereunder and the Company has
          not received any notice that the Commission has issued or intends to issue a
          stop-order with respect to the Registration Statement or that the Commission
          otherwise has suspended or withdrawn the effectiveness of the Registration
          Statement, either temporarily or permanently, or intends or has threatened in
          writing to do so. The &#147;Plan of Distribution&#148; section under the
          Registration Statement permits the issuance and sale of the Securities
          hereunder. Upon receipt of the Securities, the Purchasers will have good and
          marketable title to such Securities and the Securities will be freely tradable
          on the &#147;<U>Trading Market</U>&#148; (which, for purposes of this Agreement
          means the following markets or exchanges on which the Common Stock is listed or
          quoted for trading on the date in question: the Nasdaq Capital Market, the
          American Stock Exchange, the New York Stock Exchange, the Nasdaq National Market
          or the OTC Bulletin Board). </FONT></P>



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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(F)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Capitalization</U>. The capitalization of the Company is as set forth on
          <U>Schedule 3(F)(i)</U>. The Company has not issued any capital stock since its
          most recently filed periodic report under the Exchange Act, other than pursuant
          to the exercise of employee stock options under the Company&#146;s stock option
          plans, the issuance of shares of Common Stock to employees pursuant to the
          Company&#146;s employee stock purchase plan and pursuant to the conversion or
          exercise of securities exercisable, exchangeable or convertible into Common
          Stock (&#147;<U>Common Stock Equivalents</U>&#148;). No Person has any right of
          first refusal, preemptive right, right of participation, or any similar right to
          participate in the transactions contemplated by the Transaction Documents.
          Except as set forth on <U>Schedule 3(F)(i)</U>, and as a result of the purchase
          and sale of the Securities, 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
          exercisable or exchangeable for, or giving any Person any right to subscribe for
          or acquire, any shares of Common Stock, or contracts, commitments,
          understandings or arrangements by which the Company or any Subsidiary is or may
          become bound to issue additional shares of Common Stock or Common Stock
          Equivalents. The issuance and sale of the Securities will not obligate the
          Company to issue shares of Common Stock or other securities to any Person (other
          than the Purchasers) 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. Except as set forth on <U>Schedule 3(F)(ii)</U>, 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 Securities.
          There are no stockholders agreements, voting agreements or other similar
          agreements with respect to the Company&#146;s capital stock to which the Company
          is a party or, to the knowledge of the Company, between or among any of the
          Company&#146;s stockholders. </FONT></P>

<p align=center>
<font size=2>Page 6</font></p>
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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(G)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>SEC Reports; Financial Statements</U>. The Company has complied in all
          material respects with requirements to file all reports, schedules, forms,
          statements and other documents 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,
          including the exhibits thereto and documents incorporated by reference therein,
          being collectively referred to herein as the &#147;<U>SEC Reports</U>&#148;) on
          a timely basis or has received a valid extension of such time of filing and has
          filed any such SEC Reports prior to the expiration of any such extension. 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 the light of the circumstances under
          which they were made, not misleading. The financial statements of the Company
          included in the SEC Reports comply in all material respects with applicable
          accounting requirements and the rules and regulations of the Commission with
          respect thereto as in effect at the time of filing. Such financial statements
          have been prepared in accordance with United States generally accepted
          accounting principles applied on a consistent basis during the periods involved
          (&#147;<U>GAAP</U>&#148;), except as may be otherwise specified in such
          financial statements or the notes thereto and except that unaudited financial
          statements may not contain all footnotes required by GAAP, and fairly present in
          all material respects the financial position of the Company and its consolidated
          subsidiaries as of and for the dates thereof and the results of operations and
          cash flows for the periods then ended, subject, in the case of unaudited
          statements, to normal, immaterial, year-end audit adjustments. </FONT></P>



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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(H)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Material Changes; Undisclosed Events, Liabilities or Developments</U>. Since
          the date of the latest audited financial statements included within the SEC
          Reports, except as specifically disclosed in the SEC Reports, (i) there has been
          no event, occurrence or development that has had or that could reasonably be
          expected to result in a Material Adverse Effect, (ii) the Company has not
          incurred any liabilities (contingent or otherwise) other than (A) liabilities
          incurred in the ordinary course of business consistent with past practice and
          (B) liabilities not required to be reflected in the Company&#146;s financial
          statements pursuant to GAAP or required to be disclosed in filings made with the
          Commission, (iii) the Company has not altered its method of accounting, (iv) the
          Company has not declared or made any dividend or distribution of cash or other
          property to its stockholders or purchased, redeemed or made any agreements to
          purchase or redeem any shares of its capital stock and (v) the Company has not
          issued any equity securities to any officer, director or
          &#147;<U>Affiliate</U>&#148; (defined as any Person that, directly or indirectly
          through one or more intermediaries, controls or is controlled by or is under
          common control with a Person, as such terms are used in and construed under Rule
          144 under the Securities Act), except pursuant to existing Company stock option
          plans. The Company does not have pending before the Commission any request for
          confidential treatment of information. Except for the issuance of the Securities
          contemplated by this Agreement or as set forth on Schedule 3(H), no event,
          liability or development has occurred or exists with respect to the Company or
          its Subsidiaries or their respective business, properties, operations or
          financial condition, that would be required to be disclosed by the Company under
          applicable securities laws at the time this representation is made that has not
          been publicly disclosed 1 Trading Day prior to the date that this representation
          is made. </FONT></P>

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<font size=2>Page 7</font></p>
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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(I)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Litigation</U>. Except as set forth on <U>Schedule 3(I)</U>, 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, any Subsidiary or any of their respective properties before or by any
          court, arbitrator, governmental or administrative agency or regulatory authority
          (federal, state, county, local or foreign) (collectively, an
          &#147;<U>Action</U>&#148;) which (i) adversely affects or challenges the
          legality, validity or enforceability of any of the Transaction Documents or the
          Securities or (ii) could, if there were an unfavorable decision, have or
          reasonably be expected to result in a Material Adverse Effect. Neither the
          Company nor any Subsidiary, nor any director or officer thereof, is or has been
          the subject of any Action involving a claim of violation of or liability under
          federal or state securities laws or a claim of breach of fiduciary duty. 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 Subsidiary under the Exchange
          Act or the Securities Act. None of the Company&#146;s or its Subsidiaries&#146;
          employees is a member of a union that relates to such employee&#146;s
          relationship with the Company, and neither the Company or any of its
          Subsidiaries is a party to a collective bargaining agreement, and the Company
          and its Subsidiaries believe that their relationships with their employees are
          good. No executive officer, to the knowledge of the Company, is, or is now
          expected to be, in violation of any material term of any employment contract,
          confidentiality, disclosure or proprietary information agreement or
          non-competition agreement, or any other contract or agreement or any restrictive
          covenant, and the continued employment of each such executive officer does not
          subject the Company or any of its Subsidiaries to any liability with respect to
          any of the foregoing matters. The Company and its Subsidiaries are in compliance
          with all U.S. federal, state, local and foreign laws and regulations relating to
          employment and employment practices, terms and conditions of employment and
          wages and hours, except where the failure to be in compliance could not,
          individually or in the aggregate, reasonably be expected to have a Material
          Adverse Effect. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(J)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Labor Relations</U>. No material labor dispute exists or, to the knowledge of
          the Company, is imminent with respect to any of the employees of the Company
          which could reasonably be expected to result in a Material Adverse Effect. </FONT></P>



<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- TNR" FSL="Workstation" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(K)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Compliance</U>. 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 and all such laws that affect the environment, except
          in each case as could not have a Material Adverse Effect. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(L)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Regulatory Permits</U>. The Company and the Subsidiaries possess all
          certificates, authorizations and permits issued by the appropriate federal,
          state, local or foreign regulatory authorities necessary to conduct their
          respective businesses, except where the failure to possess such permits could
          not have or reasonably be expected to result in a Material Adverse Effect
          (&#147;<U>Material Permits</U>&#148;), and neither the Company nor any
          Subsidiary has received any notice of proceedings relating to the revocation or
          modification of any Material Permit. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(M)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Title to Assets</U>. The Company and the Subsidiaries have good and
          marketable title in fee simple to all real property owned by them that is
          material to the business of the Company and the Subsidiaries and good and
          marketable title in all personal property owned by them that is material to the
          business of the Company and the Subsidiaries, in each case free and clear of all
          Liens, except for Liens as do not materially affect the value of such property
          and do not materially interfere with the use made and proposed to be made of
          such property by the Company and the Subsidiaries and Liens for the payment of
          federal, state or other taxes, the payment of which is neither delinquent nor
          subject to penalties. 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. </FONT></P>

<p align=center>
<font size=2>Page 8</font></p>
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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(N)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Patents and Trademarks</U>. The Company and the Subsidiaries have, or have
          rights to use, all patents, patent applications, trademarks, trademark
          applications, service marks, trade names, trade secrets, inventions, copyrights,
          licenses and other similar intellectual property rights necessary or material
          for use in connection with their respective businesses and which the failure to
          so have could have a Material Adverse Effect (collectively, the
          &#147;<U>Intellectual Property Rights</U>&#148;). Neither the Company nor any
          Subsidiary has received a notice (written or otherwise) 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. The Company and its
          Subsidiaries have taken reasonable security measures to protect the secrecy,
          confidentiality and value of all of their intellectual properties, except where
          failure to do so could not, individually or in the aggregate, reasonably be
          expected to have a Material Adverse Effect. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(O)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Insurance</U>. The Company and the Subsidiaries are insured by insurers of
          recognized financial responsibility against such losses and risks and in such
          amounts as are prudent and customary in the businesses in which the Company and
          the Subsidiaries are engaged, including, but not limited to, directors and
          officers insurance coverage at least equal to the aggregate subscription amount
          under the Transaction Documents. To the best knowledge of the Company, such
          insurance contracts and policies are accurate and complete. Neither the Company
          nor any Subsidiary has any reason to believe that it will not be able to renew
          its existing insurance coverage as and when such coverage expires or to obtain
          similar coverage from similar insurers as may be necessary to continue its
          business without a significant increase in cost. </FONT></P>



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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(P)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Transactions With Affiliates and Employees</U>. Except as set forth in the
          SEC Reports, 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, 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. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(Q)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Sarbanes-Oxley</U>. The Company is in material compliance with all provisions
          of the Sarbanes-Oxley Act of 2002 which are applicable to it as of the date
          hereof and of the closing date of the Placement. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(R)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Certain Fees</U>. Except as otherwise provided in this Agreement, no
          brokerage or finder&#146;s fees or commissions are or will be payable by the
          Company to any broker, financial advisor or consultant, finder, placement agent,
          investment banker, bank or other Person with respect to the transactions
          contemplated by the Transaction Documents. The Purchasers shall have no
          obligation with respect to any fees or with respect to any claims made by or on
          behalf of other Persons for fees of a type contemplated in this Section that may
          be due in connection with the transactions contemplated by the Transaction
          Documents. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(S)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Trading Market Rules</U>. The issuance and sale of the Securities hereunder
          does not contravene the rules and regulations of the Trading Market. </FONT></P>

<p align=center>
<font size=2>Page 9</font></p>
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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(T)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Investment Company</U>. The Company is not, and is not an Affiliate of, and
          immediately after receipt of payment for the Securities, will not be or be an
          Affiliate of, an &#147;investment company&#148; within the meaning of the
          Investment Company Act of 1940, as amended. The Company shall conduct its
          business in a manner so that it will not become subject to the Investment
          Company Act. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(U)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Registration Rights</U>. Except as set forth on <U>Schedule 3(U)</U>, No
          Person has any right to cause the Company to effect the registration under the
          Securities Act of any securities of the Company. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(V)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Listing and Maintenance Requirements</U>. The Company&#146;s Common Stock is
          registered pursuant to Section 12(b) or 12(g) of the Exchange Act, and the
          Company has taken no action designed to, or which to its knowledge is likely to
          have the effect of, terminating the registration of the Common Stock under the
          Exchange Act nor has the Company received any notification that the Commission
          is contemplating terminating such registration. The Company has not, in the 12
          months preceding the date hereof, received notice from any Trading Market on
          which the Common Stock is or has been listed or quoted to the effect that the
          Company is not in compliance with the listing or maintenance requirements of
          such Trading Market. The Company is in compliance with all such listing and
          maintenance requirements. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(W)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Application of Takeover Protections</U>. The Company and its Board of
          Directors have taken all necessary action, if any, in order to render
          inapplicable any control share acquisition, business combination, poison pill
          (including any distribution under a rights agreement) or other similar
          anti-takeover provision under the Company&#146;s Certificate of Incorporation
          (or similar charter documents) or the laws of its state of incorporation that is
          or could become applicable to the Purchasers as a result of the Purchasers and
          the Company fulfilling their obligations or exercising their rights under the
          Transaction Documents, including without limitation as a result of the
          Company&#146;s issuance of the Securities and the Purchasers&#146; ownership of
          the Securities. </FONT></P>



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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(X)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Solvency</U>. Based on the financial condition of the Company as of the
          Closing Date after giving effect to the receipt by the Company of the proceeds
          from the sale of the Securities hereunder in the total amount of not less than
          one million dollars ($1,000,000), (i) the Company&#146;s fair saleable value of
          its assets exceeds the amount that will be required to be paid on or in respect
          of the Company&#146;s existing debts and other liabilities (including known
          contingent liabilities) as they mature; (ii) the Company&#146;s assets do not
          constitute unreasonably small capital to carry on its business for the current
          fiscal year as now conducted and as proposed to be conducted including its
          capital needs taking into account the particular capital requirements of the
          business conducted by the Company, and projected capital requirements and
          capital availability thereof; and (iii) the current cash flow of the Company,
          together with the proceeds the Company would receive, were it to liquidate all
          of its assets, after taking into account all anticipated uses of the cash, would
          be sufficient to pay all amounts on or in respect of its debt when such amounts
          are required to be paid. The Company does not intend to incur debts beyond its
          ability to pay such debts as they mature (taking into account the timing and
          amounts of cash to be payable on or in respect of its debt). The Company has no
          knowledge of any facts or circumstances which lead it to believe that it will
          file for reorganization or liquidation under the bankruptcy or reorganization
          laws of any jurisdiction within one year from the Closing Date. The SEC Reports
          set forth as of the dates thereof all outstanding secured and unsecured
          Indebtedness of the Company or any Subsidiary, or for which the Company or any
          Subsidiary has commitments. For the purposes of this Agreement,
          &#147;<U>Indebtedness</U>&#148; shall mean (a) any liabilities for borrowed
          money or amounts owed in excess of $50,000 (other than trade accounts payable
          incurred in the ordinary course of business), (b) all guaranties, endorsements
          and other contingent obligations in respect of Indebtedness of others, whether
          or not the same are or should be reflected in the Company&#146;s balance sheet
          (or the notes thereto), except guaranties by endorsement of negotiable
          instruments for deposit or collection or similar transactions in the ordinary
          course of business; and (c) the present value of any lease payments in excess of
          $50,000 due under leases required to be capitalized in accordance with GAAP.
          Neither the Company nor any Subsidiary is in default with respect to any
          Indebtedness. </FONT></P>

<p align=center>
<font size=2>Page 10</font></p>
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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(Y)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Tax Status</U>. 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. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(Z)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Foreign Corrupt Practices</U>. 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 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. </FONT></P>



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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(AA)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Accountants</U>. The Company&#146;s accountants are set forth on Schedule
          3(AA) of the Disclosure Schedule. To the knowledge of the Company, such
          accountants, who the Company expects will express their opinion with respect to
          the financial statements to be included in the Company&#146;s next Annual Report
          on Form 10-K, are a registered public accounting firm as required by the
          Securities Act. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(BB)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Regulation M Compliance</U>.&nbsp; The Company has not, and to its knowledge
          no one acting on its behalf has, (i) taken, directly or indirectly, any action
          designed to cause or to result in the stabilization or manipulation of the price
          of any security of the Company to facilitate the sale or resale of any of the
          Securities, (ii) sold, bid for, purchased, or, paid any compensation for
          soliciting purchases of, any of the Securities (other than for the placement
          agent&#146;s placement of the Securities), or (iii) paid or agreed to pay to any
          person any compensation for soliciting another to purchase any other securities
          of the Company. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(CC)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>Approvals</U>. Except as set forth on <U>Schedule 3(CC)</U>, the issuance and
          listing on the Nasdaq CM of the Shares requires no further approvals, including
          but not limited to, the approval of shareholders. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(DD)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          <U>NASD Affiliations</U>. There are no affiliations with any NASD member firm
          among the Company&#146;s officers, directors or, to the knowledge of the
          Company, any five percent (5%) or greater stockholder of the Company, except as
          set forth in the Base Prospectus. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>SECTION 4.</U> &nbsp;&nbsp;<U>INDEMNIFICATION.</U> The
Company agrees to the indemnification and other agreements set forth in the
Indemnification Provisions (the &#147;<U>Indemnification</U>&#148;) attached hereto as
Addendum A, the provisions of which are incorporated herein by reference and shall
survive the termination or expiration of this Agreement.  </FONT></P>

<p align=center>
<font size=2>Page 11</font></p>
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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>SECTION 5.</U> &nbsp;&nbsp;<U>ENGAGEMENT
TERM</U>. Rodman&#146;s engagement hereunder will be for the period of 90 days. The
engagement may be terminated by either the Company or Rodman at any time upon 10
days&#146; written notice. Notwithstanding anything to the contrary contained herein, the
provisions concerning confidentiality, indemnification, contribution and the
Company&#146;s obligations to pay fees and reimburse expenses contained herein and the
Company&#146;s obligations contained in the Indemnification Provisions will survive any
expiration or termination of this Agreement. Rodman agrees not to use any confidential
information concerning the Company provided to them by the Company for any purposes other
than those contemplated under this Agreement without obtaining the Company&#146;s prior
written consent. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>SECTION 6.</U> &nbsp;&nbsp;<U>RODMAN
INFORMATION</U>. The Company agrees that any information or advice rendered by Rodman in
connection with this engagement is for the confidential use of the Company only in their
evaluation of the Placement and, except as otherwise required by law, the Company will not
disclose or otherwise refer to the advice or information in any manner without
Rodman&#146;s prior written consent. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>SECTION 7.</U> &nbsp;&nbsp;<U>NO FIDUCIARY
RELATIONSHIP.</U> This Agreement does not create, and shall not be construed as creating
rights enforceable by any person or entity not a party hereto, except those entitled
hereto by virtue of the Indemnification Provisions hereof. The Company acknowledges and
agrees that Rodman is not and shall not be construed as a fiduciary of the Company and
shall have no duties or liabilities to the equity holders or the creditors of the Company
or any other person by virtue of this Agreement or the retention of Rodman hereunder, all
of which are hereby expressly waived. </FONT></P>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>SECTION 8.</U> &nbsp;&nbsp;<U>CLOSING.</U> The
obligations of the Placement Agent and the Purchasers, and the closing of the sale of the
Securities hereunder are subject to the accuracy, when made and on the Closing Date, of
the representations and warranties on the part of the Company and its Subsidiaries
contained herein, to the accuracy of the statements of the Company and its Subsidiaries
made in any certificates pursuant to the provisions hereof, to the performance by the
Company and its Subsidiaries of their obligations hereunder, and to each of the following
additional terms and conditions: </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(A)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          No stop order suspending the effectiveness of the Registration Statement shall
          have been issued and no proceedings for that purpose shall have been initiated
          or threatened by the Commission, and any request for additional information on
          the part of the Commission (to be included in the Registration Statement, the
          Base Prospectus or the Prospectus Supplement or otherwise) shall have been
          complied with to the reasonable satisfaction of the Placement Agent. Any filings
          required to be made by the Company in shall have been timely filed with the
          Commission. </FONT></P>

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     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(B)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Placement Agent shall not have discovered and disclosed to the Company on or
          prior to the Closing Date that the Registration Statement, the Base Prospectus
          or the Prospectus Supplement or any amendment or supplement thereto contains an
          untrue statement of a fact which, in the opinion of counsel for the Placement
          Agent, is material or omits to state any fact which, in the opinion of such
          counsel, is material and is required to be stated therein or is necessary to
          make the statements therein not misleading. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- TNR" FSL="Workstation" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(C)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          All corporate proceedings and other legal matters incident to the authorization,
          form, execution, delivery and validity of each of this Agreement, the
          Securities, the Registration Statement, the Base Prospectus and the Prospectus
          Supplement and all other legal matters relating to this Agreement and the
          transactions contemplated hereby shall be reasonably satisfactory in all
          material respects to counsel for the Placement Agent, and the Company shall have
          furnished to such counsel all documents and information that they may reasonably
          request to enable them to pass upon such matters. </FONT></P>

<p align=center>
<font size=2>Page 12</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px"><HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<page>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- TNR" FSL="Workstation" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(D)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Placement Agent shall have received from outside counsel to the Company such
          counsel&#146;s written opinion, addressed to the Placement Agent and the
          Purchasers dated as of the Closing Date, in form and substance reasonably
          satisfactory to the Placement Agent. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- TNR" FSL="Workstation" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(E)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Neither the Company nor any of its Subsidiaries shall have sustained since the
          date of the latest audited financial statements included or incorporated by
          reference in the Base Prospectus, (i) any loss or interference with its business
          from fire, explosion, flood, terrorist act or other calamity, whether or not
          covered by insurance, or from any labor dispute or court or governmental action,
          order or decree, otherwise than as set forth in or contemplated by the Base
          Prospectus and (ii) since such date there shall not have been any material
          change in the capital stock or long-term debt of the Company or any of its
          Subsidiaries or any change, or any development involving a prospective change,
          in or affecting the business, general affairs, management, financial position,
          stockholders&#146; equity, results of operations or prospects of the Company and
          its Subsidiaries, otherwise than as set forth in or contemplated by the Base
          Prospectus, the effect of which, in any such case described in clause (i) or
          (ii), is, in the judgment of the Placement Agent, so material and adverse as to
          make it impracticable or inadvisable to proceed with the sale or delivery of the
          Securities on the terms and in the manner contemplated by the Base Prospectus,
          the Time of Sale Prospectus, if any, and the Prospectus Supplement. </FONT></P>




<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- TNR" FSL="Workstation" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(F)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Common Stock is registered under the Exchange Act and, as of the Closing
          Date, the Shares shall be listed and admitted and authorized for trading on
          Nasdaq CM, and satisfactory evidence of such actions shall have been provided to
          the Placement Agent. The Company shall have taken no action designed to, or
          likely to have the effect of terminating the registration of the Common Stock
          under the Exchange Act or delisting or suspending from trading the Common Stock
          from Nasdaq CM, nor has the Company received any information suggesting that the
          Commission or Nasdaq CM is contemplating terminating such registration or
          listing. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- TNR" FSL="Workstation" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(G)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Subsequent to the execution and delivery of this Agreement, there shall not have
          occurred any of the following: (i) trading in securities generally on the New
          York Stock Exchange, the Nasdaq National Market or the American Stock Exchange
          or in the over-the-counter market, or trading in any securities of the Company
          on any exchange or in the over-the-counter market, shall have been suspended or
          minimum or maximum prices or maximum ranges for prices shall have been
          established on any such exchange or such market by the Commission, by such
          exchange or by any other regulatory body or governmental authority having
          jurisdiction, (ii) a banking moratorium shall have been declared by federal or
          state authorities or a material disruption has occurred in commercial banking or
          securities settlement or clearance services in the United States, (iii) the
          United States shall have become engaged in hostilities in which it is not
          currently engaged, the subject of an act of terrorism, there shall have been an
          escalation in hostilities involving the United States, or there shall have been
          a declaration of a national emergency or war by the United States, or (iv) there
          shall have occurred any other calamity or crisis or any change in general
          economic, political or financial conditions in the United States or elsewhere,
          if the effect of any such event in clause (iii) or (iv) makes it, in the sole
          judgment of the Placement Agent, impracticable or inadvisable to proceed with
          the sale or delivery of the Securities on the terms and in the manner
          contemplated by the Base Prospectus and the Prospectus Supplement. </FONT></P>

<p align=center>
<font size=2>Page 13</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px"><HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<page>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- TNR" FSL="Workstation" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(H)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          No action shall have been taken and no statute, rule, regulation or order shall
          have been enacted, adopted or issued by any governmental agency or body which
          would, as of the Closing Date, prevent the issuance or sale of the Securities or
          materially and adversely affect or potentially and adversely affect the business
          or operations of the Company; and no injunction, restraining order or order of
          any other nature by any federal or state court of competent jurisdiction shall
          have been issued as of the Closing Date which would prevent the issuance or sale
          of the Securities or materially and adversely affect or potentially and
          adversely affect the business or operations of the Company. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- TNR" FSL="Workstation" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(I)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Company shall have prepared and filed with the Commission a Current Report
          on Form 8-K with respect to the Placement, including as an exhibit thereto this
          Agreement. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- TNR" FSL="Workstation" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(J)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The Company shall have entered into subscription agreements with each of the
          Purchasers and such agreements shall be in full force and effect and shall
          contain representations and warranties of the Company as agreed between the
          Company and the Purchasers. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- TNR" FSL="Workstation" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(K)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          The NASD shall have raised no objection to the fairness and reasonableness of
          the terms and arrangements of this Agreement. In addition, the Company shall, if
          requested by the Placement Agent, make or authorize Placement Agent&#146;s
          counsel to make on the Company&#146;s behalf, an Issuer Filing with the NASDR,
          Inc. Corporate Financing Department pursuant to NASD Rule 2710 with respect to
          the Registration Statement and pay all filing fees required in connection
          therewith. </FONT></P>



<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- TNR" FSL="Workstation" -->
     <P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(L)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          Prior to the Closing Date, the Company shall have furnished to the Placement
          Agent such further information, certificates and documents as the Placement
          Agent may reasonably request. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All
opinions, letters, evidence and certificates mentioned above or elsewhere in this
Agreement shall be deemed to be in compliance with the provisions hereof only if they are
in form and substance reasonably satisfactory to counsel for the Placement Agent. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>SECTION 9</U>. <U>Governing Law;
Jurisdiction.</U> This Agreement will be governed by, and construed in accordance with,
the laws of the State of New York applicable to agreements made and to be performed
entirely in such State. Any dispute arising under this Agreement shall be brought
exclusively to the courts of the State of New York or the Federal Court located in New
York, New York and, by execution and delivery of this Agreement, each party hereby accepts
for itself and in respect of its property, generally and unconditionally, the exclusive
jurisdiction of aforesaid courts. Each party hereto hereby irrevocably waives personal
service of process and consents to process being served in any such suit, action or
proceeding by delivering a copy thereof via overnight delivery (with evidence of delivery)
to such party at the address in effect for notices to it under this Agreement and agrees
that such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right to serve
process in any manner permitted by law. If either party shall commence an action or
proceeding to enforce any provisions of a Transaction Document, 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. </FONT></P>

<p align=center>
<font size=2>Page 14</font></p>
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<page>


<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>SECTION 10</U>.&nbsp;&nbsp;
<U>Miscellaneous.</U> (i) This Agreement (including the attached Indemnification
Provisions) embodies the entire agreement and understanding between the parties hereto and
supersedes all prior agreements and understandings relating to the subject matter hereof.
(ii) This Agreement may not be assigned by either party without the prior written consent
of the other party. (iii) This Agreement shall be binding upon and inure to the benefit of
the parties hereto, and their respective successors and permitted assigns. (iv) <B>Any
right to trial by jury with respect to any dispute arising under this Agreement or any
transaction or conduct in connection herewith is waived.</B> (v) If any provision of this
Agreement is determined to be invalid or unenforceable in any respect, such determination
will not affect such provision in any other respect or any other provision of this
Agreement, which will remain in full force and effect. (vi) This Agreement may not be
amended or otherwise modified or waived except by an instrument in writing signed by both
Rodman and the Company. (vii) The representations, warranties, agreements and covenants
contained herein shall survive the closing of the Placement and delivery and/or exercise
of the Securities, as applicable. (viii) This Agreement may be executed in two or more
counterparts, all of which when taken together shall be considered one and the same
agreement and shall become effective when counterparts have been signed by each party and
delivered to the other party, it being understood that both parties need not sign the same
counterpart. (ix) In the event that any signature is delivered by facsimile transmission
or a .pdf format file, such signature shall create a valid and binding obligation of the
party executing (or on whose behalf such signature is executed) with the same force and
effect as if such facsimile signature page were an original thereof. </FONT></P>


<!-- MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>SECTION 11.</U> &nbsp;&nbsp;<U>Notices.</U>
Any and all notices or other communications or deliveries required or permitted to be
provided hereunder shall be in writing and shall be deemed given and effective on the
earliest of (a) the date of transmission, if such notice or communication is delivered via
facsimile at the facsimile number specified on the signature pages attached hereto prior
to 6:30 p.m. (New York City time) on a business day, (b) the next business day after the
date of transmission, if such notice or communication is delivered via facsimile at the
facsimile number on the signature pages attached hereto on a day that is not a business
day or later than 6:30 p.m. (New York City time) on any business day, (c) the business day
following the date of mailing, if sent by U.S. nationally recognized overnight courier
service, or (d) upon actual receipt by the party to whom such notice is required to be
given. The address for such notices and communications shall be as set forth on the
signature pages hereto. </FONT></P>

<p align=center>
<font size=2>Page 15</font></p>
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<page>


<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Please
confirm that the foregoing correctly sets forth our agreement by signing and returning to
Rodman the enclosed copy of this Agreement. </FONT></P>

<!-- MARKER FORMAT-SHEET="Signature (Single)" FSL="Workstation" -->
<TABLE WIDTH=100% CELLSPACING=0 CELLPADDING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=40%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD WIDTH=50%><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Very truly yours,<BR><BR><B>RODMAN &amp; RENSHAW, LLC</B><BR><BR>
<BR>By: /s/ John Borer <BR>&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;<BR>
John Borer<BR>Sr. Managing Director <BR><BR>
<U>Address for notice:
</U><BR>1251 Avenue of the Americas, 20th Floor
<BR>New York, NY, 10020
<BR>Fax (646) 841-1640
<BR>Attn: General Counsel </FONT>
</TD>
</TR>
</TABLE>
<BR>



<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Accepted and Agreed to as of
<BR>the date first written above:
</FONT></P>

<!-- MARKER FORMAT-SHEET="Signature (Single)" FSL="Workstation" -->
<TABLE WIDTH=100% CELLSPACING=0 CELLPADDING=0 BORDER=0>
<TR VALIGN=TOP>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>PLURISTEM THERAPEUTICS INC.<BR><BR>
<BR>By: /s/ Yaky Yanay
 <BR>&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;<BR>
Yaky Yanay<BR>CFO</FONT></TD>
</TR>
</TABLE>
<BR>




<P><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>Address for notice:
</U><BR>
<BR>Pluristem Therapeutics Inc.
<BR>MATAM Advanced Technology Park # 20
<BR>Haifa 31905, Israel
<BR>Attention: Chief Financial Officer </FONT>
</P>

<p align=center>
<font size=2>Page 16</font></p>
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<page>

<P align=center><FONT FACE="Times New Roman, Times, Serif" SIZE=2><IMG SRC="rod.jpg"></FONT></P>


<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation" -->
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>ADDENDUM A</U> </FONT> </H1>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation" -->
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>INDEMNIFICATION
PROVISIONS</U> </FONT> </H1>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
connection with the engagement of Rodman &amp; Renshaw, LLC (&#147;<U>Rodman</U>&#148;) by
Pluristem Therapeutics Inc. (the &#147;<U>Company</U>&#148;) pursuant to a letter
agreement dated March 2, 2009 between the Company and Rodman, as it may be amended from
time to time in writing (the &#147;<U>Agreement</U>&#148;), the Company hereby agrees as
follows: </FONT></P>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Lv 0-TNR" FSL="Workstation" -->
     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>1.</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          To the extent permitted by law, the Company will indemnify Rodman and its
          affiliates, stockholders, directors, officers, employees and controlling persons
          (within the meaning of Section 15 of the Securities Act of 1933, as amended, or
          Section 20 of the Securities Exchange Act of 1934) against all losses, claims,
          damages, expenses and liabilities, as the same are incurred (including the
          reasonable fees and expenses of counsel), relating to or arising out of its
          activities hereunder or pursuant to the Agreement, except to the extent that any
          losses, claims, damages, expenses or liabilities (or actions in respect thereof)
          are found in a final judgment (not subject to appeal) by a court of law to have
          resulted primarily and directly from Rodman&#146;s willful misconduct or gross
          negligence in performing the services described herein. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Lv 0-TNR" FSL="Workstation" -->
     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2.</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          Promptly after receipt by Rodman of notice of any claim or the commencement of
          any action or proceeding with respect to which Rodman is entitled to indemnity
          hereunder, Rodman will notify the Company in writing of such claim or of the
          commencement of such action or proceeding, and the Company will assume the
          defense of such action or proceeding and will employ counsel reasonably
          satisfactory to Rodman and will pay the fees and expenses of such counsel.
          Notwithstanding the preceding sentence, Rodman will be entitled to employ
          counsel separate from counsel for the Company and from any other party in such
          action if counsel for Rodman reasonably determines that it would be
          inappropriate under the applicable rules of professional responsibility for the
          same counsel to represent both the Company and Rodman. In such event, the
          reasonable fees and disbursements of no more than one such separate counsel will
          be paid by the Company. The Company will have the exclusive right to settle the
          claim or proceeding provided that the Company will not settle any such claim,
          action or proceeding without the prior written consent of Rodman, which will not
          be unreasonably withheld. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Lv 0-TNR" FSL="Workstation" -->
     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3.</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          The Company agrees to notify Rodman promptly of the assertion against it or any
          other person of any claim or the commencement of any action or proceeding
          relating to a transaction contemplated by the Agreement. </FONT></TD>
          </TR>
          </TABLE>
          <BR>



<!-- MARKER FORMAT-SHEET="Para (List) Hang Lv 0-TNR" FSL="Workstation" -->
     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4.</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          If for any reason the foregoing indemnity is unavailable to Rodman or
          insufficient to hold Rodman harmless, then the Company shall contribute to the
          amount paid or payable by Rodman as a result of such losses, claims, damages or
          liabilities in such proportion as is appropriate to reflect not only the
          relative benefits received by the Company on the one hand and Rodman on the
          other, but also the relative fault of the Company on the one hand and Rodman on
          the other that resulted in such losses, claims, damages or liabilities, as well
          as any relevant equitable considerations. The amounts paid or payable by a party
          in respect of losses, claims, damages and liabilities referred to above shall be
          deemed to include any legal or other fees and expenses incurred in defending any
          litigation, proceeding or other action or claim. Notwithstanding the provisions
          hereof, Rodman&#146;s share of the liability hereunder shall not be in excess of
          the amount of fees actually received, or to be received, by Rodman under the
          Agreement (excluding any amounts received as reimbursement of expenses incurred
          by Rodman). </FONT></TD>
          </TR>
          </TABLE>
          <BR>


<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px"><HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<page>

<!-- MARKER FORMAT-SHEET="Para (List) Hang Lv 0-TNR" FSL="Default" -->
     <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
          <TR VALIGN=TOP>
          <TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5.</FONT></TD>
          <TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
          These Indemnification Provisions shall remain in full force and effect whether
          or not the transaction contemplated by the Agreement is completed and shall
          survive the termination of the Agreement, and shall be in addition to any
          liability that the Company might otherwise have to any indemnified party under
          the Agreement or otherwise. </FONT></TD>
          </TR>
          </TABLE>
          <BR>

<!-- MARKER FORMAT-SHEET="Signature (Single)" FSL="Workstation" -->
<TABLE WIDTH=100% CELLSPACING=0 CELLPADDING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=40%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD WIDTH=50%><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>RODMAN &amp; RENSHAW, LLC</B><BR><BR>
<BR>By: /s/ John Borer  <BR>&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;<BR>
 John Borer<BR>Sr. Managing Director</FONT></TD>
</TR>
</TABLE>
<BR>




<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Accepted and Agreed to as of
<BR>the date first written above:
</FONT></P>


<!-- MARKER FORMAT-SHEET="Signature (Single)" FSL="Workstation" -->
<TABLE WIDTH=100% CELLSPACING=0 CELLPADDING=0 BORDER=0>
<TR VALIGN=TOP>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>PLURISTEM THERAPEUTICS INC.<BR><BR>
<BR>By: /s/ Yaky Yanay <BR>&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;<BR>
Yaky Yanay<BR>CFO</FONT></TD>
</TR>
</TABLE>
<BR>


<p align=center>
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`
end
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4.1
<SEQUENCE>4
<FILENAME>exhibit_4-1.htm
<TEXT>
<HTML>
<HEAD>
     <!-- Created by EDGAR Ease Plus (EDGAR Ease+) -->
     <!-- Project:        \\Backup\edgar filing\Pluristem Therapeutics Inc\96706\a96706.eep -->
     <!-- Control Number: 96706                                                            -->
     <!-- Rev Number:     1                                                                -->
     <!-- Client Name:    Pluristem Therapeutics Inc                                       -->
     <!-- Project Name:   8-K                                                              -->
     <!-- Firm Name:      Zadok-Keinan Ltd                                                 -->
     <TITLE>8-K</TITLE>
</HEAD>
<BODY>

<!-- MARKER FORMAT-SHEET="Scotch Rule Top-TNR" FSL="Workstation" -->
<HR ALIGN=LEFT WIDTH=100% SIZE=4 NOSHADE STYLE="margin-top: -5px">
<HR ALIGN=LEFT WIDTH=100% SIZE=1 NOSHADE STYLE="margin-top: -10px">

<P align=right><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U><B>Exhibit 4.1</B></U> </FONT> </P>

<!-- MARKER FORMAT-SHEET="Head Right-TNR" FSL="Workstation" -->
<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>EXHIBIT A</B> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation" -->
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>COMMON STOCK PURCHASE
WARRANT </FONT></H1>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Default" -->
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>PLURISTEM THERAPEUTICS
INC. </FONT></H1>

<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=50% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Warrant Shares: _______</FONT></TD>
     <TD WIDTH=50% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Initial Exercise Date: November __, 2009</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Issue Date: May __, 2009</FONT></TD></TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Para Large Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;THIS
COMMON STOCK PURCHASE WARRANT (the &#147;<U>Warrant</U>&#148;) certifies that, for value
received, _____________ (the &#147;<U>Holder</U>&#148;) is entitled, upon the terms and
subject to the limitations on exercise and the conditions hereinafter set forth, at any
time on or after November __, 2009 (the &#147;<U>Initial Exercise Date</U>&#148;) and on
or prior to the close of business on the five year anniversary of the Initial Exercise
Date (the &#147;<U>Termination Date</U>&#148;) but not thereafter, to subscribe for and
purchase from Pluristem Therapeutics Inc., a Nevada corporation (the
&#147;<U>Company</U>&#148;), up to ______ shares (the &#147;<U>Warrant Shares</U>&#148;)
of Common Stock. The purchase price of one share of Common Stock under this Warrant shall
be equal to the Exercise Price, as defined in Section 2(b). </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent Lv 0-TNR" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Section
1</U>.&nbsp;&nbsp; <U>Definitions</U>. Capitalized terms used and not otherwise defined herein shall
have the meanings set forth in that certain Securities Purchase Agreement (the
&#147;<U>Purchase Agreement</U>&#148;), dated May __, 2009, among the Company and the
purchasers signatory thereto. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Section
2</U>.&nbsp;&nbsp; <U>Exercise</U>. </FONT> </P>


<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 1- TNR" FSL="Workstation" -->
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Exercise
of Warrant</U>. Exercise of the purchase rights represented by this           Warrant may
be made, in whole or in part, at any time or times on or after the           Initial
Exercise Date and on or before the Termination Date by delivery to the           Company
(or such other office or agency of the Company as it may designate by           notice in
writing to the registered Holder at the address of the Holder           appearing on the
books of the Company) of: (i) a completed and duly executed           copy of the Notice
of Exercise Form annexed hereto; and (ii) payment of the           aggregate Exercise
Price of the shares thereby purchased by wire transfer or           bank or certified
check drawn on a United States bank. The date such items are           delivered to the
Company (as determined in accordance with the notice provisions           hereof) is an
&#147;Exercise Date.&#148; The Holder shall not be required to           deliver the
original Warrant in order to effect an exercise hereunder, but if it           is not so
delivered then such exercise shall constitute an agreement by the           Holder to
deliver the original Warrant to the Company as soon as practicable           thereafter
and in any event, within three (3) Trading Days of the Exercise           Date.&nbsp; Execution
and delivery of the Exercise Notice shall have the same           effect as cancellation
of the original Warrant and issuance of a new Warrant           evidencing the right to
purchase the remaining number of Warrant Shares, if any,           and the Company shall
issue such new Warrant as soon as possible after receipt           and cancellation of
the original Warrant. The Company shall maintain records           showing the number of
Warrant Shares purchased and the date of such purchases.           The Company shall
deliver any objection to any Notice of Exercise Form within           three (3) Trading
Days of receipt of such notice.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px"><HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<page>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 1- TNR" FSL="Workstation" -->
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Exercise
Price</U>. The exercise price per share of the Common Stock under           this Warrant
shall be <B>$1.96</B>, subject to adjustment hereunder (the           &#147;<U>Exercise
Price</U>&#148;).  </FONT></P></TD>
</TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 1- TNR" FSL="Workstation" -->
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Cashless
Exercise</U>. If at any time during the term of this Warrant there           is no
effective Registration Statement registering, or no current prospectus
          available for, the issuance or resale of the Warrant Shares by the Holder, then
          this Warrant may also be exercised at such time by means of a &#147;cashless
          exercise&#148; in which the Holder shall be entitled to receive a certificate
          for the number of Warrant Shares equal to the quotient obtained by dividing
          [(A-B) (X)] by (A), where:  </FONT></P></TD>
</TR>
</TABLE>
<BR>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR VALIGN=Bottom>
     <TD WIDTH="10%"> </TD>
     <TD WIDTH="5%" ALIGN="LEFT" VALIGN="TOP"><FONT FACE="Times New Roman" SIZE=2>(A)</FONT></TD>
     <TD WIDTH="2%" ALIGN="CENTER" VALIGN="TOP"><FONT FACE="Times New Roman" SIZE=2>=</FONT></TD>
     <TD WIDTH="83%" ALIGN="LEFT"><FONT FACE="Times New Roman" SIZE=2>the VWAP on the Trading Day immediately preceding the date of such election;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD> </TD>
     <TD ALIGN="LEFT" WIDTH="5%" VALIGN="TOP"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD> </TD>
     <TD ALIGN="LEFT" WIDTH="5%" VALIGN="TOP"><FONT FACE="Times New Roman" SIZE=2>(B)</FONT></TD>
     <TD ALIGN="CENTER" WIDTH="2%" VALIGN="TOP"><FONT FACE="Times New Roman" SIZE=2>=</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>the Exercise Price of this Warrant, as adjusted; and</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD> </TD>
     <TD ALIGN="LEFT" WIDTH="5%" VALIGN="TOP"><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD> </TD>
     <TD ALIGN="LEFT" WIDTH="5%" VALIGN="TOP"><FONT FACE="Times New Roman" SIZE=2>(X)</FONT></TD>
     <TD ALIGN="CENTER" WIDTH="2%" VALIGN="TOP"><FONT FACE="Times New Roman" SIZE=2>=</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>the number of Warrant Shares issuable upon exercise of this Warrant in accordance with the terms of this Warrant by means of a cash exercise rather than a cashless exercise.</FONT></TD></TR>
</TABLE>

<BR>

<!-- MARKER FORMAT-SHEET="Para Indent Lv 0-TNR" FSL="Workstation" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding
anything herein to the contrary, on the Termination Date, this Warrant shall be
automatically exercised via cashless exercise pursuant to this Section 2(c).  </FONT></P>


<p align=center>
<font size=2>2</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px"><HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<page>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 1- TNR" FSL="Workstation" -->
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;d) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Holder&#146;s
Restrictions</U>. The Company shall not effect any exercise of                this
Warrant, and a Holder shall not have the right to exercise any portion of
               this Warrant, pursuant to Section 2 or otherwise, to the extent that after
               giving effect to such issuance after exercise as set forth on the
applicable                Notice of Exercise, the Holder (together with the Holder&#146;s
Affiliates, and                any other person or entity acting as a group together with
the Holder or any of                the Holder&#146;s Affiliates), would beneficially own
in excess of the                Beneficial Ownership Limitation (as defined below).&nbsp; For
purposes of the                foregoing sentence, the number of shares of Common Stock
beneficially owned by                the Holder and its Affiliates shall include the
number of shares of Common Stock                issuable upon exercise of this Warrant
with respect to which such determination                is being made, but shall exclude
the number of shares of Common Stock which                would be issuable upon (A)
exercise of the remaining, nonexercised portion of                this Warrant
beneficially owned by the Holder or any of its Affiliates and (B)                exercise
or conversion of the unexercised or nonconverted portion of any other
               securities of the Company (including, without limitation, any other Common
Stock                Equivalents) subject to a limitation on conversion or exercise
analogous to the                limitation contained herein beneficially owned by the
Holder or any of its                affiliates.&nbsp; Except as set forth in the
preceding sentence, for purposes of                this Section 2(d)(i), beneficial
ownership shall be calculated in accordance                with Section 13(d) of the
Exchange Act and the rules and regulations promulgated                thereunder, it
being acknowledged by the Holder that the Company is not                representing to
the Holder that such calculation is in compliance with Section                13(d) of
the Exchange Act and the Holder is solely responsible for any schedules
               required to be filed in accordance therewith. To the extent that the
limitation                contained in this Section 2(d) applies, the determination of
whether this                Warrant is exercisable (in relation to other securities owned
by the Holder                together with any Affiliates) and of which portion of this
Warrant is                exercisable shall be in the sole discretion of the Holder, and
the submission of                a Notice of Exercise shall be deemed to be the Holder&#146;s
determination of                whether this Warrant is exercisable (in relation to other
securities owned by                the Holder together with any Affiliates) and of which
portion of this Warrant is                exercisable, in each case subject the
Beneficial Ownership Limitation, and the                Company shall have no obligation
to verify or confirm the accuracy of such                determination. In addition, a
determination as to any group status as                contemplated above shall be
determined in accordance with Section 13(d) of the                Exchange Act and the
rules and regulations promulgated thereunder. For purposes                of this Section
2(d), in determining the number of outstanding shares of Common                Stock, a
Holder may rely on the number of outstanding shares of Common Stock as
               reflected in (A) the Company&#146;s most recent periodic annual report as
the                case may be, (B) a more recent public announcement by the Company or
(C) any                other notice by the Company or the Transfer Agent setting forth
the number of                shares of Common Stock outstanding.&nbsp; Upon the written
or oral request of a                Holder, the Company shall within three (3) Trading
Days confirm orally and in                writing to the Holder the number of shares of
Common Stock then                outstanding.&nbsp; In any case, the number of
outstanding shares of Common Stock                shall be determined after giving effect
to the conversion or exercise of                securities of the Company, including this
Warrant, by the Holder or its                Affiliates since the date as of which such
number of outstanding shares of                Common Stock was reported. The &#147;<U>Beneficial
Ownership </U><U>Limitation</U>&#148; shall be 4.99% of the number of shares of the
Common                Stock outstanding immediately after giving effect to the issuance
of shares of                Common Stock issuable upon exercise of this Warrant. The
Holder, upon not less                than sixty one (61) days&#146; prior notice to the
Company, may increase or                decrease the Beneficial Ownership Limitation
provisions of this Section 2(d),                provided that the Beneficial Ownership
Limitation in no event exceeds 9.99% of                the number of shares of the Common
Stock outstanding immediately after giving                effect to the issuance of
shares of Common Stock upon exercise of this Warrant                held by the Holder
and the provisions of this Section 2(d) shall continue to                apply. Any such
increase or decrease will not be effective until the                61<SUP>st</SUP> day
after such notice is delivered to the Company. The                provisions of this
paragraph shall be construed and implemented in a manner                otherwise than in
strict conformity with the terms of this Section 2(d) to                correct this
paragraph (or any portion hereof) which may be defective or                inconsistent
with the intended Beneficial Ownership Limitation herein contained                or to
make changes or supplements necessary or desirable to properly give effect
               to such limitation. The limitations contained in this paragraph shall
apply to a                successor holder of this Warrant.  </FONT></P></TD>
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<font size=2>3</font></p>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;e) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Mechanics
of Exercise</U>.  </FONT></P></TD>
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<TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;i. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Delivery
of Certificates Upon Exercise</U>. Certificates for shares purchased
               hereunder shall be transmitted by the Transfer Agent to the Holder by
crediting                the account of the Holder&#146;s prime broker with the
Depository Trust Company                through its Deposit Withdrawal Agent Commission (&#147;<U>DWAC</U>&#148;)
system                if the Company is then a participant in such system and either (A)
there is an                effective Registration Statement permitting the resale of the
Warrant Shares by                the Holder or this Warrant is being exercised via
cashless exercise, and                otherwise by physical delivery to the address
specified by the Holder in the                Notice of Exercise within three (3) Trading
Days from the delivery to the                Company of the Notice of Exercise Form,
surrender of this Warrant (if required)                and payment of the aggregate
Exercise Price as set forth above (the                &#147;<U>Warrant Share Delivery Date</U>&#148;).
This Warrant shall be deemed to                have been exercised on the date the
Exercise Price is received by the Company.                The Warrant Shares shall be
deemed to have been issued, and Holder or any other                person so designated
to be named therein shall be deemed to have become a holder                of record of
such shares for all purposes, as of the date the Warrant has been
               exercised by payment to the Company of the Exercise Price (or by cashless
               exercise, if permitted) and all taxes required to be paid by the Holder,
if any,                pursuant to Section 2(e)(vi) prior to the issuance of such shares,
have been                paid.  </FONT></P></TD>
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<TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;ii. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Delivery
of New Warrants Upon Exercise</U>. If this Warrant shall have been
               exercised in part, the Company shall, at the request of a Holder and upon
               surrender of this Warrant certificate, at the time of delivery of the
               certificate or certificates representing Warrant Shares, deliver to Holder
a new                Warrant evidencing the rights of Holder to purchase the unpurchased
Warrant                Shares called for by this Warrant, which new Warrant shall in all
other respects                be identical with this Warrant.  </FONT></P></TD>
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<TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;iii. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Rescission
Rights</U>. If the Company fails to cause the Transfer Agent to                transmit
to the Holder a certificate or the certificates representing the                Warrant
Shares pursuant to Section 2(e)(i) by the Warrant Share Delivery Date,
               then the Holder will have the right to rescind such exercise.  </FONT></P></TD>
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<TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;iv. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Compensation
for Buy-In on Failure to Timely Deliver Certificates Upon                Exercise</U>. In
addition to any other rights available to the Holder, if the                Company fails
to cause the Transfer Agent to transmit to the Holder a                certificate or the
certificates representing the Warrant Shares pursuant to an                exercise on or
before the Warrant Share Delivery Date, and if after such date                the Holder
is required by its broker to purchase (in an open market transaction                or
otherwise) or the Holder&#146;s brokerage firm otherwise purchases, shares of
               Common Stock to deliver in satisfaction of a sale by the Holder of the
Warrant                Shares which the Holder anticipated receiving upon such exercise
(a                &#147;<U>Buy-In</U>&#148;), then the Company shall (A) pay in cash to
the Holder                the amount by which (x) the Holder&#146;s total purchase price
(including                brokerage commissions, if any) for the shares of Common Stock
so purchased                exceeds (y) the amount obtained by multiplying (1) the number
of Warrant Shares                that the Company was required to deliver to the Holder
in connection with the                exercise at issue times (2) the price at which the
sell order giving rise to                such purchase obligation was executed, and (B)
at the option of the Holder,                either reinstate the portion of the Warrant
and equivalent number of Warrant                Shares for which such exercise was not
honored or deliver to the Holder the                number of shares of Common Stock that
would have been issued had the Company                timely complied with its exercise
and delivery obligations hereunder. For                example, if the Holder purchases
Common Stock having a total purchase price of                $11,000 to cover a Buy-In
with respect to an attempted exercise of shares of                Common Stock with an
aggregate sale price giving rise to such purchase                obligation of $10,000,
under clause (1) of the immediately preceding sentence                the Company shall
be required to pay the Holder $1,000. The Holder shall provide                the Company
written notice indicating the amounts payable to the Holder in                respect of
the Buy-In and, upon request of the Company, evidence of the amount                of
such loss. Nothing herein shall limit a Holder&#146;s right to pursue any
               other remedies available to it hereunder, at law or in equity including,
without                limitation, a decree of specific performance and/or injunctive
relief with                respect to the Company&#146;s failure to timely deliver
certificates                representing shares of Common Stock upon exercise of the
Warrant as required                pursuant to the terms hereof.  </FONT></P></TD>
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<TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;v. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>No
Fractional Shares or Scrip</U>. No fractional shares or scrip representing
               fractional shares shall be issued upon the exercise of this Warrant. As to
any                fraction of a share which Holder would otherwise be entitled to
purchase upon                such exercise, the Company shall, at its election, either
pay a cash adjustment                in respect of such final fraction in an amount equal
to such fraction multiplied                by the Exercise Price or round up to the next
whole share.  </FONT></P></TD>
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<TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;vi. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Charges,
Taxes and Expenses</U>. Issuance of certificates for Warrant Shares shall
be made without charge to the Holder for any issue or transfer tax or
other incidental expense in respect of the issuance of such certificate,
all of which taxes and expenses shall be paid by the Company, and such
certificates shall be issued in the name of the Holder or in such name or
names as may be directed by the Holder; <U>provided</U>,<U> however</U>, that in
the event certificates for Warrant Shares are to be issued in a name other
than the name of the Holder, this Warrant when surrendered for exercise
shall be accompanied by the Assignment Form attached hereto duly executed
by the Holder and the Company may require, as a condition thereto, the
payment of a sum sufficient to reimburse it for any transfer tax
incidental thereto. </FONT> </P></TD>
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<TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;vii. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Closing
of Books</U>. The Company will not close its stockholder books or                records
in any manner which prevents the timely exercise of this Warrant,                pursuant
to the terms hereof.  </FONT></P></TD>
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<p align=center>
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<P><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Section
3.</U> &nbsp;&nbsp;<U>Certain Adjustments</U>. </FONT> </P>


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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;a) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Stock
Dividends and Splits</U>. If the Company, at any time while this                Warrant
is outstanding: (i) pays a stock dividend or otherwise make a                distribution
or distributions on shares of its Common Stock or any other equity                or
equity equivalent securities payable in shares of Common Stock (which, for
               avoidance of doubt, shall not include any shares of Common Stock issued by
the                Company upon exercise of this Warrant), (ii) subdivides outstanding
shares of                Common Stock into a larger number of shares, (iii) combines
(including by way of                reverse stock split) outstanding shares of Common
Stock into a smaller number of                shares, or (iv) issues by reclassification
of shares of the Common Stock any                shares of capital stock of the Company,
then in each case the Exercise Price                shall be multiplied by a fraction of
which the numerator shall be the number of                shares of Common Stock
(excluding treasury shares, if any) outstanding                immediately before such
event and of which the denominator shall be the number                of shares of Common
Stock outstanding immediately after such event and the                number of shares
issuable upon exercise of this Warrant shall be proportionately                adjusted
such that the aggregate Exercise Price of this Warrant shall remain
               unchanged. Any adjustment made pursuant to this Section 3(a) shall become
               effective immediately after the record date for the determination of
               stockholders entitled to receive such dividend or distribution and shall
become                effective immediately after the effective date in the case of a
subdivision,                combination or re-classification.  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;b) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Intentionally
Omitted.  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;c) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Subsequent
Rights Offerings</U>. If the Company, at any time while the                Warrant is
outstanding, shall issue rights, options or warrants to all holders                of
Common Stock (and not to Holders) entitling them to subscribe for or purchase
               shares of Common Stock at a price per share less than the VWAP at the
record                date mentioned below, then, the Exercise Price shall be multiplied
by a                fraction, of which the denominator shall be the number of shares of
the Common                Stock outstanding on the date of issuance of such rights or
warrants plus the                number of additional shares of Common Stock offered for
subscription or                purchase, and of which the numerator shall be the number
of shares of the Common                Stock outstanding on the date of issuance of such
rights or warrants plus the                number of shares which the aggregate offering
price of the total number of                shares so offered (assuming receipt by the
Company in full of all consideration                payable upon exercise of such rights,
options or warrants) would purchase at                such VWAP. Such adjustment shall be
made whenever such rights or warrants are                issued, and shall become
effective immediately after the record date for the                determination of
stockholders entitled to receive such rights, options or                warrants.  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;d) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Pro
Rata Distributions</U>. If the Company, at any time while this Warrant is
               outstanding, shall distribute to all holders of Common Stock (and not to
Holders                of the Warrants) evidences of its indebtedness or assets
(including cash and                cash dividends) or rights or warrants to subscribe for
or purchase any security                other than the Common Stock (which shall be
subject to Section 3(b)), then in                each such case the Exercise Price shall
be adjusted by multiplying the Exercise                Price in effect immediately prior
to the record date fixed for determination of                stockholders entitled to
receive such distribution by a fraction of which the                denominator shall be
the VWAP determined as of the record date mentioned above,                and of which
the numerator shall be such VWAP on such record date less the then                per
share fair market value at such record date of the portion of such assets or
               evidence of indebtedness so distributed applicable to one outstanding
share of                the Common Stock as determined by the Board of Directors in good
faith. In                either case the adjustments shall be described in a statement
provided to the                Holder of the portion of assets or evidences of
indebtedness so distributed or                such subscription rights applicable to one
share of Common Stock. Such                adjustment shall be made whenever any such
distribution is made and shall become                effective immediately after the
record date mentioned above.  </FONT></P></TD>
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<font size=2>6</font></p>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;e) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Fundamental
Transaction</U>. If, at any time while this Warrant is                outstanding, (i)
the Company effects any merger or consolidation of the Company                with or
into another Person, (ii) the Company effects any sale of all or
               substantially all of its assets in one or a series of related
transactions,                (iii) any tender offer or exchange offer (whether by the
Company or another                Person) is completed pursuant to which holders of
Common Stock are permitted to                tender or exchange their shares for other
securities, cash or property or (iv)                the Company effects any
reclassification of the Common Stock or any compulsory                share exchange
pursuant to which the Common Stock is effectively converted into                or
exchanged for other securities, cash or property (each &#147;<U>Fundamental
               Transaction</U>&#148;), then, upon any subsequent exercise of this
Warrant, the                Holder shall have the right to receive, for each Warrant
Share that would have                been issuable upon such exercise immediately prior
to the occurrence of such                Fundamental Transaction, the number of shares of
Common Stock of the successor                or acquiring corporation or of the Company,
if it is the surviving corporation,                and any additional consideration (the
&#147;<U>Alternate                Consideration</U>&#148;) receivable as a result of such
merger, consolidation or                disposition of assets by a holder of the number
of shares of Common Stock for                which this Warrant is exercisable
immediately prior to such event. For purposes                of any such exercise, the
determination of the Exercise Price shall be                appropriately adjusted to
apply to such Alternate Consideration based on the                amount of Alternate
Consideration issuable in respect of one share of Common                Stock in such
Fundamental Transaction, and the Company shall apportion the                Exercise
Price among the Alternate Consideration in a reasonable manner                reflecting
the relative value of any different components of the Alternate
               Consideration. If holders of Common Stock are given any choice as to the
               securities, cash or property to be received in a Fundamental Transaction,
then                the Holder shall be given the same choice as to the Alternate
Consideration it                receives upon any exercise of this Warrant following such
Fundamental                Transaction. To the extent necessary to effectuate the
foregoing provisions, any                successor to the Company or surviving entity in
such Fundamental Transaction                shall issue to the Holder a new warrant
consistent with the foregoing provisions                and evidencing the Holder&#146;s
right to exercise such warrant into Alternate                Consideration. The terms of
any agreement pursuant to which a Fundamental                Transaction is effected
shall include terms requiring any such successor or                surviving entity to
comply with the provisions of this Section 3(e) and insuring                that this
Warrant (or any such replacement security) will be similarly adjusted                upon
any subsequent transaction analogous to a Fundamental Transaction.
               Notwithstanding anything to the contrary, in the event of a Fundamental
               Transaction that is (1) an all cash transaction, (2) a &#147;Rule 13e-3
               transaction&#148; as defined in Rule 13e-3 under the Exchange Act, or (3)
a                Fundamental Transaction involving a person or entity not traded on a
national                securities exchange, the Nasdaq Global Select Market, the Nasdaq
Global Market,                or the Nasdaq Capital Market, the Company or any successor
entity shall pay at                the Holder&#146;s option, exercisable at any time
concurrently with or within 30                days after the consummation of the
Fundamental Transaction, an amount of cash                equal to the value of this
Warrant as determined in accordance with the Black                Scholes Option Pricing
Model obtained from the &#147;OV&#148; function on                Bloomberg L.P. using
(A) a price per share of Common Stock equal to the VWAP of                the Common
Stock for the Trading Day immediately preceding the date of                consummation
of the applicable Fundamental Transaction, (B) a risk-free interest                rate
corresponding to the U.S. Treasury rate for 30 day period immediately prior
               to the consummation of the applicable Fundamental Transaction, (C) an
expected                volatility equal to the 100 day volatility obtained from the
&#147;HVT&#148;               function on Bloomberg L.P. determined as of the Trading Day
immediately                following the public announcement of the applicable
Fundamental Transaction, and                (D) a remaining option time equal to the time
between the date of the public                announcement of such transaction and the
Termination Date.  </FONT></P></TD>
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<p align=center>
<font size=2>7</font></p>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;f) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Calculations</U>.
All calculations under this Section 3 shall be made to the                nearest cent or
the nearest 1/100th of a share, as the case may be. For purposes                of this
Section 3, the number of shares of Common Stock deemed to be issued and
               outstanding as of a given date shall be the sum of the number of shares of
               Common Stock (excluding treasury shares, if any) issued and outstanding.  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;g) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Notice
to Holder</U>.  </FONT></P></TD>
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<TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;i. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Adjustment
to Exercise Price</U>. Whenever the Exercise Price is adjusted                pursuant to
any provision of this Section 3, the Company shall promptly mail to                the
Holder a notice setting forth the Exercise Price after such adjustment and
               setting forth a brief statement of the facts requiring such adjustment.  </FONT></P></TD>
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<TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;ii. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Notice
to Allow Exercise by Holder</U>. If (A) the Company shall declare a
               dividend (or any other distribution in whatever form) on the Common Stock,
(B)                the Company shall declare a special nonrecurring cash dividend on or a
               redemption of the Common Stock, (C) the Company shall authorize the
granting to                all holders of the Common Stock rights or warrants to
subscribe for or purchase                any shares of capital stock of any class or of
any rights, (D) the approval of                any stockholders of the Company shall be
required in connection with any                reclassification of the Common Stock, any
consolidation or merger to which the                Company is a party, any sale or
transfer of all or substantially all of the                assets of the Company, or any
compulsory share exchange whereby the Common Stock                is converted into other
securities, cash or property, or (E) the Company shall                authorize the
voluntary or involuntary dissolution, liquidation or winding up of                the
affairs of the Company, then, in each case, the Company shall cause to be
               mailed to the Holder at its last address as it shall appear upon the
Warrant                Register of the Company, at least 20 calendar days prior to the
applicable                record or effective date hereinafter specified, a notice
stating (x) the date on                which a record is to be taken for the purpose of
such dividend, distribution,                redemption, rights or warrants, or if a
record is not to be taken, the date as                of which the holders of the Common
Stock of record to be entitled to such                dividend, distributions,
redemption, rights or warrants are to be determined or                (y) the date on
which such reclassification, consolidation, merger, sale,                transfer or
share exchange is expected to become effective or close, and the                date as
of which it is expected that holders of the Common Stock of record shall
               be entitled to exchange their shares of the Common Stock for securities,
cash or                other property deliverable upon such reclassification,
consolidation, merger,                sale, transfer or share exchange; provided that the
failure to mail such notice                or any defect therein or in the mailing
thereof shall not affect the validity of                the corporate action required to
be specified in such notice. The Holder is                entitled to exercise this
Warrant during the period commencing on the date of                such notice to the
effective date of the event triggering such notice.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

<p align=center>
<font size=2>8</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px"><HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<page>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Section
4.</U>&nbsp;&nbsp; <U>Transfer of Warrant</U>. </FONT> </P>


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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Transferability</U>.
This Warrant and all rights hereunder (including,           without limitation, any
registration rights) are transferable, in whole or in           part, upon surrender of
this Warrant at the principal office of the Company or           its designated agent,
together with a written assignment of this Warrant           substantially in the form
attached hereto duly executed by the Holder or its           agent or attorney and funds
sufficient to pay any transfer taxes payable upon           the making of such transfer.
Upon such surrender and, if required, such payment,           the Company shall execute
and deliver a new Warrant or Warrants in the name of           the assignee or assignees,
as applicable, and in the denomination or           denominations specified in such
instrument of assignment, and shall issue to the           assignor a new Warrant
evidencing the portion of this Warrant not so assigned,           and this Warrant shall
promptly be cancelled. The Warrant, if properly assigned,           may be exercised by a
new holder for the purchase of Warrant Shares without           having a new Warrant
issued.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>New
Warrants</U>. This Warrant may be divided or combined with other Warrants           upon
presentation hereof at the aforesaid office of the Company, together with a
          written notice specifying the names and denominations in which new Warrants are
          to be issued, signed by the Holder or its agent or attorney. Subject to
          compliance with Section 4(a), as to any transfer which may be involved in such
          division or combination, the Company shall execute and deliver a new Warrant or
          Warrants in exchange for the Warrant or Warrants to be divided or combined in
          accordance with such notice. All Warrants issued on transfers or exchanges
shall           be dated the Original Issue Date and shall be identical with this Warrant
except           as to the number of Warrant Shares issuable pursuant thereto.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Warrant
Register</U>. The Company shall register this Warrant, upon records           to be
maintained by the Company for that purpose (the &#147;<U>Warrant           Register</U>&#148;),
in the name of the record Holder hereof from time to time.           The Company may deem
and treat the registered Holder of this Warrant as the           absolute owner hereof
for the purpose of any exercise hereof or any distribution           to the Holder, and
for all other purposes, absent actual notice to the contrary.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

<p align=center>
<font size=2>9</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px"><HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<page>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Section
5.</U> &nbsp;&nbsp;<U>Miscellaneous</U>. </FONT> </P>


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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>No
Rights as Stockholder Until Exercise</U>. This Warrant does not entitle           the
Holder to any voting rights or other rights as a stockholder of the Company
          prior to the exercise hereof as set forth in Section 2(e)(i).  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Loss,
Theft, Destruction or Mutilation of Warrant</U>. The Company covenants           that
upon receipt by the Company of evidence reasonably satisfactory to it of           the
loss, theft, destruction or mutilation of this Warrant or any stock           certificate
relating to the Warrant Shares, and in case of loss, theft or           destruction, of
indemnity or security reasonably satisfactory to it (which, in           the case of the
Warrant, shall not include the posting of any bond), and upon           surrender and
cancellation of such Warrant or stock certificate, if mutilated,           the Company
will make and deliver a new Warrant or stock certificate of like           tenor and
dated as of such cancellation, in lieu of such Warrant or stock           certificate.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Saturdays,
Sundays, Holidays, etc</U>. If the last or appointed day for the           taking of any
action or the expiration of any right required or granted herein           shall not be a
Business Day, then, such action may be taken or such right may be           exercised on
the next succeeding Business Day.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Authorized
Shares</U>.  </FONT></P></TD>
</TR>
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<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company covenants that, during the period the Warrant is outstanding, it will reserve
from its authorized and unissued Common Stock a sufficient number of shares to provide
for the issuance of the Warrant Shares upon the exercise of any purchase rights under
this Warrant. The Company further covenants that its issuance of this Warrant shall
constitute full authority to its officers who are charged with the duty of executing
stock certificates to execute and issue the necessary certificates for the Warrant Shares
upon the exercise of the purchase rights under this Warrant. The Company will take all
such reasonable action as may be necessary to assure that such Warrant Shares may be
issued as provided herein without violation of any applicable law or regulation, or of
any requirements of the Trading Market upon which the Common Stock may be listed. The
Company covenants that all Warrant Shares which may be issued upon the exercise of the
purchase rights represented by this Warrant will, upon exercise of the purchase rights
represented by this Warrant, be duly authorized, validly issued, fully paid and
nonassessable and free from all taxes, liens and charges created by the Company in
respect of the issue thereof (other than taxes in respect of any transfer occurring
contemporaneously with such issue).  </FONT>
</TD>
</TR>
</TABLE>
<BR>

<p align=center>
<font size=2>10</font></p>
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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Except
and to the extent as waived or consented to by the Holder, the Company shall not by any
action, including, without limitation, amending its certificate of incorporation or
through any reorganization, transfer of assets, consolidation, merger, dissolution, issue
or sale of securities or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms of this Warrant, but will at all times in
good faith assist in the carrying out of all such terms and in the taking of all such
actions as may be necessary or appropriate to protect the rights of Holder as set forth
in this Warrant against impairment. Without limiting the generality of the foregoing, the
Company will (i) not increase the par value of any Warrant Shares above the amount
payable therefor upon such exercise immediately prior to such increase in par value, (ii)
take all such action as may be necessary or appropriate in order that the Company may
validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise
of this Warrant and (iii) use commercially reasonable efforts to obtain all such
authorizations, exemptions or consents from any public regulatory body having
jurisdiction thereof, as may be, necessary to enable the Company to perform its
obligations under this Warrant.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Before
taking any action which would result in an adjustment in the number of Warrant Shares for
which this Warrant is exercisable or in the Exercise Price, the Company shall obtain all
such authorizations or exemptions thereof, or consents thereto, as may be necessary from
any public regulatory body or bodies having jurisdiction thereof.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Jurisdiction</U>.
All questions concerning the construction, validity,           enforcement and
interpretation of this Warrant shall be determined in accordance           with the
provisions of the Purchase Agreement.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Restrictions</U>.
The Holder acknowledges that the Warrant Shares acquired           upon the exercise of
this Warrant, if not registered, will have restrictions           upon resale imposed by
state and federal securities laws.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;g)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Nonwaiver
and Expenses</U>. No course of dealing or any delay or failure to           exercise any
right hereunder on the part of Holder shall operate as a waiver of           such right
or otherwise prejudice Holder&#146;s rights, powers or remedies,
          notwithstanding the fact that all rights hereunder terminate on the Termination
          Date. If the Company willfully and knowingly fails to comply with any provision
          of this Warrant, which results in any material damages to the Holder, the
          Company shall pay to Holder such amounts as shall be sufficient to cover any
          costs and expenses including, but not limited to, reasonable attorneys&#146;          fees,
including those of appellate proceedings, incurred by Holder in collecting           any
amounts due pursuant hereto or in otherwise enforcing any of its rights,           powers
or remedies hereunder.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;h)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Notices</U>.
Any notice, request or other document required or permitted to           be given or
delivered to the Holder by the Company shall be delivered in           accordance with
the notice provisions of the Purchase Agreement.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;i)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Limitation
of Liability</U>. No provision hereof, in the absence of any           affirmative action
by Holder to exercise this Warrant to purchase Warrant           Shares, and no
enumeration herein of the rights or privileges of Holder, shall           give rise to
any liability of Holder for the purchase price of any Common Stock           or as a
stockholder of the Company, whether such liability is asserted by the           Company
or by creditors of the Company.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

<p align=center>
<font size=2>11</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px"><HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<page>

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<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;j)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Remedies</U>.
The Holder, in addition to being entitled to exercise all           rights granted by
law, including recovery of damages, will be entitled to           specific performance of
its rights under this Warrant. The Company agrees that           monetary damages would
not be adequate compensation for any loss incurred by           reason of a breach by it
of the provisions of this Warrant and hereby agrees to           waive and not to assert
the defense in any action for specific performance that           a remedy at law would
be adequate.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;k)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Successors
and Assigns</U>. Subject to applicable securities laws, this           Warrant and the
rights and obligations evidenced hereby shall inure to the           benefit of and be
binding upon the successors of the Company and the successors           and permitted
assigns of Holder. The provisions of this Warrant are intended to           be for the
benefit of all Holders from time to time of this Warrant and shall be
          enforceable by the Holder or holder of Warrant Shares.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;l)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Amendment</U>.
This Warrant may be modified or amended or the provisions           hereof waived with
the written consent of the Company and Holders holding           Warrants at least equal
to 67% of the Warrant Shares issuable upon exercise of           all then outstanding
Warrants.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;m)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Severability</U>.
Wherever possible, each provision of this Warrant shall be           interpreted in such
manner as to be effective and valid under applicable law,           but if any provision
of this Warrant shall be prohibited by or invalid under           applicable law, such
provision shall be ineffective to the extent of such           prohibition or invalidity,
without invalidating the remainder of such provisions           or the remaining
provisions of this Warrant.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;n)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Headings</U>.
The headings used in this Warrant are for the convenience of           reference only and
shall not, for any purpose, be deemed a part of this Warrant.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<HR SIZE=1 NOSHADE WIDTH=15% ALIGN=center>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I>(Signature Pages
Follow) </I></FONT></P>

<p align=center>
<font size=2>12</font></p>
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<page>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN
WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer
thereunto duly authorized as of the date first above indicated. </FONT></P>



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<TD WIDTH=40%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
<TD WIDTH=50%><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>PLURISTEM THERAPEUTICS INC.</B><BR><BR>
<BR>By:<BR>&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;<BR>
Name:<BR>Title:</FONT></TD>
</TR>
</TABLE>
<BR>


<p align=center>
<font size=2>13</font></p>
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<page>

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<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>NOTICE OF EXERCISE </FONT></H1>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>TO:  </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>PLURISTEM
THERAPEUTICS INC.</FONT></TD>
</TR>
</TABLE>
<BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) The
undersigned hereby elects to purchase ________ Warrant Shares of the Company pursuant to
the terms of the attached Warrant (only if exercised in full), and tenders herewith
payment of the exercise price in full, together with all applicable transfer taxes, if
any.  </FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Payment
shall take the form of (check applicable box):  </FONT></P>


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<TD WIDTH=5%>&nbsp;</TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
<FONT size="3" face="Wingdings">o
</font>&nbsp; in lawful money of the United States; or </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
<FONT size="3" face="Wingdings">o
</font>&nbsp; [if permitted] the cancellation of such number of Warrant Shares as is necessary, in
accordance with the formula set forth in subsection 2(c), to exercise this Warrant with
respect to the maximum number of Warrant Shares purchasable pursuant to the cashless
exercise procedure set forth in subsection 2(c). </FONT></TD>
</TR>
</TABLE>
<BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3)
Please issue a certificate or certificates representing said Warrant Shares in the name
of the undersigned or in such other name as is specified below:  </FONT></P>


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<TR VALIGN=TOP>
<TD WIDTH=5%>&nbsp;</TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
_______________________________ </FONT></TD>
</TR>
</TABLE>
<BR>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The Warrant Shares shall be delivered
to the following DWAC Account Number or by physical delivery of a certificate to: </FONT></P>

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<TR VALIGN=TOP>
<TD WIDTH=5%>&nbsp;</TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
_______________________________ </FONT></TD>
</TR>
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<BR>
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<TR VALIGN=TOP>
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<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
_______________________________ </FONT></TD>
</TR>
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<BR>
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<TR VALIGN=TOP>
<TD WIDTH=5%>&nbsp;</TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
_______________________________ </FONT></TD>
</TR>
</TABLE>
<BR>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>[SIGNATURE OF HOLDER]</FONT></P>


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<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Name of Investing Entity: _______________________________________________________________________ </FONT> <BR>
<FONT FACE="Times New Roman, Times, Serif" SIZE="2"><I>Signature of Authorized Signatory of Investing Entity: </I>_________________________________________________ </FONT> <BR>
<FONT FACE="Times New Roman, Times, Serif" SIZE="2">Name of Authorized Signatory: ___________________________________________________________________ </FONT> <BR>
<FONT FACE="Times New Roman, Times, Serif" SIZE="2">Title of Authorized Signatory: ____________________________________________________________________ </FONT> <BR>
<FONT FACE="Times New Roman, Times, Serif" SIZE="2">Date: ________________________________________________________________________________________ </FONT> </P>

<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px"><HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<page>


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<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>ASSIGNMENT FORM </FONT></H1>

<P align=center><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(To assign the foregoing warrant, execute
<BR>this form and supply required information.
<BR>Do not use this form to exercise the warrant.)</FONT></P>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;FOR
VALUE  RECEIVED,  [____] all of or  [_______]  shares of the  foregoing  Warrant  and all
rights evidenced thereby are hereby assigned to </FONT></P>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>_______________________________________________ whose address is</FONT></P>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>_______________________________________________________________________________.</FONT></P>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>_______________________________________________________________________________</FONT></P>


<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=50% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=50% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Dated: ______________, _______</FONT></TD></TR>
</TABLE>
<BR>

<TABLE CELLPADDING=0 CELLSPACING=0 BORDER=0 WIDTH=100%>
<TR VALIGN=Bottom>
     <TH> </TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH>
     <TH><FONT FACE="Times New Roman" SIZE=1></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=10%> </TD>
     <TD WIDTH=20% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Holder's Signature:</FONT></TD>
     <TD WIDTH=70% ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;_____________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD> </TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD> </TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>Holder's Address:</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;_____________________________</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD> </TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD> </TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman" SIZE=2>&nbsp;_____________________________</FONT></TD></TR>
</TABLE><BR>



<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Signature Guaranteed:  ___________________________________________</FONT></P>



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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>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 company. Officers of corporations and those acting in a fiduciary or other
representative capacity should file proper evidence of authority to assign the foregoing
Warrant. </FONT></P>



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</DOCUMENT>
<DOCUMENT>
<TYPE>EX-5.1
<SEQUENCE>5
<FILENAME>exhibit_5-1.htm
<TEXT>
<HTML>
<HEAD>
     <!-- Created by EDGAR Ease Plus (EDGAR Ease+) -->
     <!-- Project:        \\Backup\edgar filing\Pluristem Therapeutics Inc\96706\a96706.eep -->
     <!-- Control Number: 96706                                                            -->
     <!-- Rev Number:     1                                                                -->
     <!-- Client Name:    Pluristem Therapeutics Inc                                       -->
     <!-- Project Name:   8-K                                                              -->
     <!-- Firm Name:      Zadok-Keinan Ltd                                                 -->
     <TITLE>8-K</TITLE>
</HEAD>
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<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U><B>Exhibit 5.1</B></U> </FONT> </P>

<P align=center><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Zysman, Aharoni, Gayer &amp; Co./Sullivan &amp; Worcester LLP
<BR>One Post Office Square
<BR>Boston, MA 02109</FONT></P>

<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>May 5, 2009
<BR>Pluristem Therapeutics Inc.
<BR>Matam Advanced Technology Park
<BR>Building No. 20
<BR>Haifa 31905, Israel</FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Re: Sale of Shares and Warrants
pursuant to Registration Statement on Form S-3 </FONT></P>

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<P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Ladies and Gentlemen: </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
opinion is furnished to you in connection with a shelf Registration Statement on Form S-3
(the &#147;<U>Registration Statement</U>&#148;) and related prospectus supplement (the
&#147;<U>Prospectus Supplement</U>&#148;) filed or to be filed with the Securities and
Exchange Commission (the &#147;<U>Commission</U>&#148;) under the Securities Act of 1933,
as amended (the &#147;<U>Securities Act</U>&#148;), with respect to the sale &#147;off the
shelf&#148; of 888,406 shares of your common stock (the &#147;<U>Shares</U>&#148;) and
warrants to purchase 488,623 shares of common stock (the &#147;<U>Warrants</U>&#148; and,
together with the Shares, the &#147;<U>Securities</U>&#148;). You are a Nevada corporation
and are referred to herein as the &#147;<U>Company</U>.&#148; </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
are acting as counsel for the Company in connection with the registration and sale of the
Securities. We have examined copies of the Registration Statement and Prospectus
Supplement filed or to be filed with the Commission. We have also examined and relied upon
minutes of meetings of the stockholders and the Board of Directors of the Company
as provided to us by the Company, stock record books of the Company as provided to us by
the Company, the Certificate of Incorporation and By-Laws of the Company, each as restated
and/or amended to date (collectively the &#147;<U>Charter Documents</U>&#148;), and such
other documents as we have deemed necessary for purposes of rendering the opinions
hereinafter set forth. </FONT> </P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
our examination of the foregoing documents, we have assumed the genuineness of all
signatures, the authenticity of all documents submitted to us as originals, the conformity
to original documents of all documents submitted to us as copies, the authenticity of the
originals of such latter documents and the legal competence of all signatories to such
documents. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
purposes of our opinion, we have examined an official compilation of &#147;Title 7 &#150;
Business Associations; Securities; Commodities, Chapter &#150; 78 &#150; Private
Corporations&#148; of the Nevada Revised Statutes (such examination being limited to the
provisions of such statutes only, and not including any annotations or commentary). We do
not purport to be experts on the laws of the State of Nevada, and with your permission our
opinion is based upon such limited experience. Other than such examination and our
examination of the documents indicated above, we have made no other examination in
connection with this opinion. We express no opinion herein concerning the federal laws of
the United States of America or any state securities or blue sky laws. We assume that the
appropriate action will be taken, prior to the offer and sale of the Shares, to register
and qualify the Shares for sale under all applicable state securities or &#147;blue
sky&#148; laws. </FONT></P>


<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px"><HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<page>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Based
upon and subject to the foregoing, we are of the opinion that: (i) when issued at the
closing for the sale of the Securities against receipt of the purchase price therefor, the
Shares and the Warrants will be validly issued, fully paid and nonassessable, and (ii) the
shares of common stock issued upon proper exercise of the Warrants and receipt of the
exercise price therefor, will be validly issued, fully paid and nonassessable. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Please
note that we are opining only as to the matters expressly set forth herein, and no opinion
should be inferred as to any other matters. This opinion is based upon currently existing
statutes, rules, regulations and judicial decisions, as further limited above, and we
disclaim any obligation to advise you of any change in any of these sources of law or
subsequent legal or factual developments which might affect any matters or opinions set
forth herein. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
hereby consent to the filing of this opinion with the Commission as an exhibit to the Form
8-K of the Company being filed on the date hereof in accordance with the requirements of
Item 601(b)(5) of Regulation S-K under the Securities Act. In giving such consent, we do
not hereby admit that we are in the category of persons whose consent is required under
Section 7 of the Securities Act or the rules and regulations of the Commission. </FONT></P>

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<TR VALIGN=TOP>
<TD WIDTH=50%>&nbsp;</TD>
<TD WIDTH=50%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
 Very truly yours,
<BR>
<BR>/s/ Zysman, Aharoni, Gayer &amp; Co./
<BR>Sullivan &amp; Worcester LLP</FONT></TD>
</TR>
</TABLE>
<BR>





<p align=center>
<font size=2>2</font></p>
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</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.1
<SEQUENCE>6
<FILENAME>exhibit_10-1.htm
<TEXT>
<HTML>
<HEAD>
     <!-- Created by EDGAR Ease Plus (EDGAR Ease+) -->
     <!-- Project:        \\Backup\edgar filing\Pluristem Therapeutics Inc\96706\a96706.eep -->
     <!-- Control Number: 96706                                                            -->
     <!-- Rev Number:     1                                                                -->
     <!-- Client Name:    Pluristem Therapeutics Inc                                       -->
     <!-- Project Name:   8-K                                                              -->
     <!-- Firm Name:      Zadok-Keinan Ltd                                                 -->
     <TITLE>8-K</TITLE>
</HEAD>
<BODY>

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<P align=right><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U><B>Exhibit 10.1</B></U> </FONT> </P>


<!-- MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Workstation" -->
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>SECURITIES PURCHASE
AGREEMENT </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
Securities Purchase Agreement (this &#147;<U>Agreement</U>&#148;) is dated as of May 5,
2009, between Pluristem Therapeutics Inc., a Nevada corporation (the
&#147;<U>Company</U>&#148;), and each purchaser identified on the signature pages hereto
(each, including its successors and assigns, a &#147;<U>Purchaser</U>&#148; and
collectively the &#147;<U>Purchasers</U>&#148;). </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,
subject to the terms and conditions set forth in this Agreement and pursuant to an
effective registration statement under the Securities Act of 1933, as amended (the
&#147;<U>Securities Act</U>&#148;), the Company desires to issue and sell to each
Purchaser, and each Purchaser, severally and not jointly, desires to purchase from the
Company, securities of the Company as more fully described in this Agreement. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NOW,
THEREFORE, IN CONSIDERATION of the mutual covenants contained in this Agreement, and for
other good and valuable consideration the receipt and adequacy of which are hereby
acknowledged, the Company and each Purchaser agree as follows: </FONT></P>

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<P ALIGN=center><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>ARTICLE I.</B> </FONT> <BR>
<FONT FACE="Times New Roman, Times, Serif" SIZE=2>DEFINITIONS </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;1.1 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Definitions</U>.
In addition to the terms defined elsewhere in this Agreement, for all purposes of
this Agreement, the following terms have the meanings set forth in this Section 1.1:&#147;<U>Acquiring
Person</U>&#148; shall have
the meaning ascribed to such term in Section 4.5. </FONT> </P>



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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Action</U>&#148; shall
have the meaning ascribed to such term in Section 3.1(j).  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Affiliate</U>&#148; means
any Person that, directly or indirectly through one or more intermediaries, controls or
is controlled by or is under common control with a Person as such terms are used in and
construed under Rule 405 under the Securities Act.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Board
of Directors</U>&#148; means the board of directors of the Company.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Business
Day</U>&#148; means any day except Saturday, Sunday, any day which is a federal legal
holiday in the United States or any day on which banking institutions in the State of New
York are authorized or required by law or other governmental action to close.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Closing</U>&#148; means
the closing of the purchase and sale of the Securities pursuant to Section 2.1.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Closing
Date</U>&#148; means the Trading Day when all of the Transaction Documents have been
executed and delivered by the applicable parties thereto, and all conditions precedent to
(i) the Purchasers&#146; obligations to pay the Subscription Amount and (ii) the Company&#146;s
obligations to deliver the Securities have been satisfied or waived.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Commission</U>&#148; means
the United States Securities and Exchange Commission.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

<p align=center>
<font size=2></font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px"><HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<page>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Common
Stock</U>&#148; means the common stock of the Company, par value $0.00001 per share, and
any other class of securities into which such securities may hereafter be reclassified or
changed into.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Common
Stock Equivalents</U>&#148; means any securities of the Company or the Subsidiaries which
would entitle the holder thereof to acquire at any time Common Stock, including, without
limitation, any debt, preferred stock, rights, options, warrants or other instrument that
is at any time convertible into or exercisable or exchangeable for, or otherwise entitles
the holder thereof to receive, Common Stock.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Company
Counsel</U>&#148; means Zysman, Aharoni, Gayer &amp; Co./Sullivan &amp; Worcester LLP,
with offices located at One Post Office Square, Boston, MA 02109.  </FONT>
</TD>
</TR>
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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Disclosure
Schedules</U>&#148; means the Disclosure Schedules of the Company delivered concurrently
herewith.  </FONT>
</TD>
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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Discussion
Time</U>&#148; shall have the meaning ascribed to such term in Section 3.2(e).  </FONT>
</TD>
</TR>
</TABLE>
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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Evaluation
Date</U>&#148; shall have the meaning ascribed to such term in Section 3.1(r).  </FONT>
</TD>
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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Exchange
Act</U>&#148; means the Securities Exchange Act of 1934, as amended, and the rules and
regulations promulgated thereunder.  </FONT>
</TD>
</TR>
</TABLE>
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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Exempt
Issuance</U>&#148; means the issuance of (a) shares of Common Stock or options to
employees, officers, consultants, advisors or directors of the Company pursuant to any
stock or option plan duly adopted for such purpose, by a majority of the non-employee
members of the Board of Directors or a majority of the members of a committee of
non-employee directors established for such purpose, (b) securities received upon the
exercise or exchange of or conversion of any Securities issued hereunder and/or other
securities exercisable or exchangeable for or convertible into shares of Common Stock
issued and outstanding on the date of this Agreement, provided that such securities have
not been amended since the date of this Agreement to increase the number of such
securities or to decrease the exercise, exchange or conversion price of such securities,
and (c) securities issued pursuant to acquisitions or strategic transactions approved by
a majority of the disinterested directors of the Company, provided that any such issuance
shall only be to a Person which is, itself or through its subsidiaries, an operating
company in a business synergistic with the business of the Company and in which the
Company receives benefits in addition to the investment of funds, but shall not include a
transaction in which the Company is issuing securities primarily for the purpose of
raising capital or to an entity whose primary business is investing in securities.  </FONT>
</TD>
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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>FDA</U>&#148; shall
have the meaning ascribed to such term in Section 3.1(gg).  </FONT>
</TD>
</TR>
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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>FDCA</U>&#148; shall
have the meaning ascribed to such term in Section 3.1(gg).  </FONT>
</TD>
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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>FWS</U>&#148; means
Feldman Weinstein &amp; Smith LLP with offices located at 420 Lexington Avenue, Suite
2620, New York, New York 10170-0002.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

<p align=center>
<font size=2>2</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px"><HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<page>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>GAAP</U>&#148; shall
have the meaning ascribed to such term in Section 3.1(h).  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Indebtedness</U>&#148; shall
have the meaning ascribed to such term in Section 3.1(z).  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Intellectual
Property Rights</U>&#148; shall have the meaning ascribed to such term in Section 3.1(o).  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Liens</U>&#148; means
a lien, charge, security interest, encumbrance, right of first refusal, preemptive right
or other restriction.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Material
Adverse Effect</U>&#148; shall have the meaning assigned to such term in Section 3.1(b).  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Material
Permits</U>&#148; shall have the meaning ascribed to such term in Section 3.1(m).  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Participation
Maximum</U>&#148; shall have the meaning ascribed to such term in Section 4.12(a).  </FONT>
</TD>
</TR>
</TABLE>
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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Per
Share Purchase Price</U>&#148; equals <B>$1.50</B>, subject to adjustment for reverse and
forward stock splits, stock dividends, stock combinations and other similar transactions
of the Common Stock that occur after the date of this Agreement and prior to the Closing.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Person</U>&#148; means
an individual or corporation, partnership, trust, incorporated or unincorporated
association, joint venture, limited liability company, joint stock company, government
(or an agency or subdivision thereof) or other entity of any kind.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Pharmaceutical
Product</U>&#148; shall have the meaning ascribed to such term in Section 3.1(gg).  </FONT>
</TD>
</TR>
</TABLE>
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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Pre-Notice</U>&#148; shall
have the meaning ascribed to such term in Section 4.12(b).  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Pro
Rata Portion</U>&#148; shall have the meaning ascribed to such term in Section 4.12(e).  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Proceeding</U>&#148; means
an action, claim, suit, investigation or proceeding (including, without limitation, an
informal investigation or partial proceeding, such as a deposition), whether commenced or
threatened.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Prospectus</U>&#148; means
the final prospectus filed for the Registration Statement.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Prospectus
Supplement</U>&#148; means the supplement to the Prospectus complying with Rule 424(b) of
the Securities Act that is filed with the Commission prior to the Closing.  </FONT>
</TD>
</TR>
</TABLE>
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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Purchaser
Party</U>&#148; shall have the meaning ascribed to such term in Section 4.8.  </FONT>
</TD>
</TR>
</TABLE>
<BR>


<p align=center>
<font size=2>3</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px"><HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<page>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Registration
Statement</U>&#148; means the effective registration statement with Commission file No.
333-151761 which registers the sale of the Shares, the Warrants and the Warrant Shares to
the Purchasers.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Required
Approvals</U>&#148; shall have the meaning ascribed to such term in Section 3.1(e).  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Rule
144</U>&#148; means Rule 144 promulgated by the Commission pursuant to the Securities
Act, as such Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the Commission having substantially the same effect as such Rule.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>SEC
Reports</U>&#148; shall have the meaning ascribed to such term in Section 3.1(h).  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Securities</U>&#148; means
the Shares, the Warrants and the Warrant Shares.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Securities
Act</U>&#148; means the Securities Act of 1933, as amended, and the rules and regulations
promulgated thereunder.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Shares</U>&#148; means
the shares of Common Stock issued or issuable to each Purchaser pursuant to this
Agreement.  </FONT>
</TD>
</TR>
</TABLE>
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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Short
Sales</U>&#148; means all &#147;short sales&#148; as defined in Rule 200 of Regulation
SHO under the Exchange Act (but shall not be deemed to include the location and/or
reservation of borrowable shares of Common Stock).&nbsp; </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Subscription
Amount</U>&#148; means, as to each Purchaser, the aggregate amount to be paid for Shares
and Warrants purchased hereunder as specified below such Purchaser&#146;s name on the
signature page of this Agreement and next to the heading &#147;Subscription Amount,&#148; in
United States dollars and in immediately available funds.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Subsequent
Financing</U>&#148; shall have the meaning ascribed to such term in Section 4.12(a).  </FONT>
</TD>
</TR>
</TABLE>
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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Subsequent
Financing Notice</U>&#148; shall have the meaning ascribed to such term in Section
4.12(b).  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Subsidiary</U>&#148; means
any subsidiary of the Company as set forth on <U>Schedule 3.1(a)</U>, and shall, where
applicable, also include any direct or indirect subsidiary of the Company formed or
acquired after the date hereof.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Trading
Day</U>&#148; means a day on which the New York Stock Exchange is open for trading.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Trading
Market</U>&#148; means the following markets or exchanges on which the Common Stock is
listed or quoted for trading on the date in question: the American Stock Exchange, the
Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market or the
New York Stock Exchange.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

<p align=center>
<font size=2>4</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px"><HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<page>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Transaction
Documents</U>&#148; means this Agreement, the Warrants and any other documents or
agreements executed in connection with the transactions contemplated hereunder.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Transfer
Agent</U>&#148; means American Stock Transfer &amp; Trust Company, the current transfer
agent of the Company, and any successor transfer agent of the Company.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>VWAP</U>&#148; means,
for any date, the price determined by the first of the following clauses that applies:
(a) if the Common Stock is then listed or quoted on a Trading Market, the daily volume
weighted average price of the Common Stock for such date (or the nearest preceding date)
on the Trading Market on which the Common Stock is then listed or quoted for trading as
reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York City time) to
4:02 p.m. (New York City time); (b)&nbsp; if the OTC Bulletin Board is not a Trading
Market, the volume weighted average price of the Common Stock for such date (or the
nearest preceding date) on the OTC Bulletin Board; (c) if the Common Stock is not then
listed or quoted for trading on the OTC Bulletin Board and if prices for the Common Stock
are then reported in the &#147;Pink Sheets&#148; published by Pink Sheets, LLC (or a
similar organization or agency succeeding to its functions of reporting prices), the most
recent bid price per share of the Common Stock so reported; or (d)&nbsp;in all other
cases, the fair market value of a share of Common Stock as determined by an independent
appraiser selected in good faith by the Purchasers of a majority in interest of the
Shares then outstanding and reasonably acceptable to the Company, the fees and expenses
of which shall be paid by the Company.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Warrants</U>&#148; means,
collectively, the Common Stock purchase warrants delivered to the Purchasers at the
Closing in accordance with Section 2.2(a) hereof, which Warrants shall be exercisable 181
days from the date hereof and have a term of exercise equal to 5 years from the date they
are first exercisable, in the form of <U>Exhibit A</U> attached hereto.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#147;<U>Warrant
Shares</U>&#148; means the shares of Common Stock issuable upon exercise of the Warrants.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<P ALIGN=center><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>ARTICLE II.</B> </FONT> <BR>
<FONT FACE="Times New Roman, Times, Serif" SIZE=2>PURCHASE AND SALE </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;2.1 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Closing</U>.
On the Closing Date, upon the terms and subject to the conditions set forth herein,
substantially concurrent with the execution and delivery of this Agreement by the parties
hereto, the Company agrees to sell, and the Purchasers, severally and not jointly, agree
to purchase, up to an aggregate of <B>$1,332,610.12</B> of Shares and Warrants. Each
Purchaser shall deliver to the Company, via wire transfer or a certified check,
immediately available funds equal to its Subscription Amount and the Company shall
deliver to each Purchaser its respective Shares and a Warrant as determined pursuant to
Section 2.2(a), and the Company and each Purchaser shall deliver the other items set
forth in Section 2.2 deliverable at the Closing. Upon satisfaction of the covenants and
conditions set forth in Sections 2.2 and 2.3, the Closing shall occur at the offices of
FWS or such other location as the parties shall mutually agree and may take place by the
electronic delivery of executed documents.  </FONT></P>

<p align=center>
<font size=2>5</font></p>
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<page>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;2.2 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Deliveries</U>. </FONT> </P>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
or prior to the Closing Date, the Company shall deliver or cause to be
               delivered to each Purchaser the following:  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=10%></TD>
<TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(i) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;this
Agreement duly executed by the Company;  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=10%></TD>
<TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(ii) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a
legal opinion of Company Counsel, substantially in the form of <U>Exhibit                B</U> attached
hereto;  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=10%></TD>
<TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(iii) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a
copy of the irrevocable instructions to the Company&#146;s transfer agent
               instructing the transfer agent to deliver via the Depository Trust Company
               Deposit Withdrawal Agent Commission System (&#147;<U>DWAC</U>&#148;)
Shares                equal to such Purchaser&#146;s Subscription Amount divided by the
Per Share                Purchase Price, registered in the name of such Purchaser;  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=10%></TD>
<TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(iv) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a
Warrant registered in the name of such Purchaser to purchase up to a number of
               shares of Common Stock equal to <B>55%</B> of such Purchaser&#146;s
Shares, with                an exercise price equal to <B>$1.96</B>, subject to
adjustment therein (such                Warrant certificate may be delivered within three
Trading Days of the Closing                Date); and  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=10%></TD>
<TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(v) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;the
Prospectus and Prospectus Supplement (which may be delivered in accordance
               with Rule 172 under the Securities Act).  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
or prior to the Closing Date, each Purchaser shall deliver or cause to be
               delivered to the Company the following:  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=10%></TD>
<TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(i) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;this
Agreement duly executed by such Purchaser; and  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=10%></TD>
<TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(ii) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;such
Purchaser&#146;s Subscription Amount by wire transfer to the account as
               specified in writing by the Company.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;2.3 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Closing
Conditions</U>. </FONT> </P>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=5%></TD>
               <TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               The obligations of the Company hereunder in connection with the Closing are
               subject to the following conditions being met: </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=10%></TD>
<TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(i) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;the
accuracy in all material respects on the Closing Date of the representations
               and warranties of the Purchasers contained herein;  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=10%></TD>
<TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(ii) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;all
obligations, covenants and agreements of each Purchaser required to be
               performed at or prior to the Closing Date shall have been performed; and  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=10%></TD>
<TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(iii) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;the
delivery by each Purchaser of the items set forth in Section 2.2(b) of this
               Agreement.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

<p align=center>
<font size=2>6</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px"><HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<page>


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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
respective obligations of the Purchasers hereunder in connection with the
               Closing are subject to the following conditions being met:  </FONT></P></TD>
</TR>
</TABLE>
<BR>


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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=10%></TD>
<TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(i) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;the
accuracy in all material respects on the Closing Date of the representations
               and warranties of the Company contained herein;  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=10%></TD>
<TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(ii) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;all
obligations, covenants and agreements of the Company required to be
               performed at or prior to the Closing Date shall have been performed;  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=10%></TD>
<TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(iii) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;the
delivery by the Company of the items set forth in Section 2.2(a) of this
               Agreement;  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=10%></TD>
<TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(iv) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;there
shall have been no Material Adverse Effect with respect to the Company
               since the date hereof; and  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=10%></TD>
<TD WIDTH=90%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(v) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;from
the date hereof to the Closing Date, trading in the Common Stock shall not
               have been suspended by the Commission or the Company&#146;s principal
Trading                Market (except for any suspension of trading of limited duration
agreed to by                the Company, which suspension shall be terminated prior to
the Closing), and, at                any time prior to the Closing Date, trading in
securities generally as reported                by Bloomberg L.P. shall not have been
suspended or limited, or minimum prices                shall not have been established on
securities whose trades are reported by such                service, or on any Trading
Market, nor shall a banking moratorium have been                declared either by the
United States or New York State authorities nor shall                there have occurred
any material outbreak or escalation of hostilities or other                national or
international calamity of such magnitude in its effect on, or any                material
adverse change in, any financial market which, in each case, in the
               reasonable judgment of each Purchaser, makes it impracticable or
inadvisable to                purchase the Securities at the Closing.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<P ALIGN=center><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>ARTICLE III.</B> </FONT> <BR>
<FONT FACE="Times New Roman, Times, Serif" SIZE=2>REPRESENTATIONS AND
WARRANTIES </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;3.1 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Representations
and Warranties of the Company</U>. Except as set forth in the Disclosure Schedules, which
Disclosure Schedules shall be deemed a part hereof and shall qualify any representation
or otherwise made herein to the extent of the disclosure contained in the corresponding
section of the Disclosure Schedules, the Company hereby makes the following
representations and warranties to each Purchaser:  </FONT></P>

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<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Subsidiaries</U>.
All of the direct and indirect subsidiaries of the Company           are set forth on <U>Schedule
</U><U>3.1(a)</U>. The Company owns, directly or           indirectly, all of the capital
stock or other equity interests of each           Subsidiary free and clear of any Liens,
and all of the issued and outstanding           shares of capital stock of each
Subsidiary are validly issued and are fully           paid, non-assessable and free of
preemptive and similar rights to subscribe for           or purchase securities. If the
Company has no subsidiaries, then all other           references to the Subsidiaries or
any of them in the Transaction Documents shall           be disregarded.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

<p align=center>
<font size=2>7</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px"><HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<page>

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<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Organization
and Qualification</U>. The Company and each of the Subsidiaries           is an entity
duly incorporated or otherwise organized, validly existing and in           good standing
under the laws of the jurisdiction of its incorporation or           organization, 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 nor default of any of the           provisions of its
respective certificate or articles of incorporation, bylaws or           other
organizational or charter documents. Each of the Company and the           Subsidiaries
is duly qualified to conduct business and is in good standing as a           foreign
corporation or other entity in each jurisdiction in which the nature of           the
business conducted or property owned by it makes such qualification           necessary,
except where the failure to be so qualified or in good standing, as           the case
may be, could not have or reasonably be expected to result in: (i) a           material
adverse effect on the legality, validity or enforceability of any           Transaction
Document, (ii) a material adverse effect on the results of           operations, assets,
business, prospects or condition (financial or otherwise) of           the Company and
the Subsidiaries, taken as a whole, or (iii) a material adverse           effect on the
Company&#146;s ability to perform in any material respect on a           timely basis its
obligations under any Transaction Document (any of (i), (ii) or           (iii), a &#147;<U>Material
Adverse Effect</U>&#148;) 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.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Authorization;
Enforcement</U>. The Company has the requisite corporate power           and authority to
enter into and to consummate the transactions contemplated by           each of the
Transaction Documents and otherwise to carry out its obligations           hereunder and
thereunder. The execution and delivery of each of the Transaction           Documents by
the Company and the consummation by it of the transactions           contemplated hereby
and thereby have been duly authorized by all necessary           action on the part of
the Company and no further action is required by the           Company, the Board of
Directors or the Company&#146;s stockholders in connection           therewith other than
in connection with the Required Approvals. Each Transaction           Document to which
it is a party has been (or upon delivery will have been) duly           executed by the
Company and, when delivered in accordance with the terms hereof           and thereof,
will constitute the valid and binding obligation of the Company           enforceable
against the Company 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&#146; rights generally, (ii) as limited by laws
          relating to the availability of specific performance, injunctive relief or
other           equitable remedies and (iii) insofar as indemnification and contribution
          provisions may be limited by applicable law.  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>No
Conflicts</U>. Except as set forth on <U>Schedule 3.1(d)</U>, the           execution,
delivery and performance by the Company of the Transaction Documents,           the
issuance and sale of the Securities and the consummation by it to which it           is a
party of the other transactions contemplated hereby and thereby do not and           will
not (i) conflict with or violate any provision of the Company&#146;s or any
          Subsidiary&#146;s certificate or articles of incorporation, bylaws or other
          organizational or charter documents, or (ii) conflict with, or constitute a
          default (or an event that with notice or lapse of time or both would become a
          default) under, result in the creation of any Lien upon any of the properties
or           assets of the Company or any Subsidiary, 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 a Company or Subsidiary debt or otherwise) or other
          understanding to which the Company or any Subsidiary is a party or by which any
          property or asset of the Company or any Subsidiary is bound or affected, or
          (iii) subject to the Required Approvals, conflict with or result in a violation
          of any law, rule, regulation, order, judgment, injunction, decree or other
          restriction of any court or governmental authority to which the Company or a
          Subsidiary is subject (including federal and state securities laws and
          regulations), or by which any property or asset of the Company or a Subsidiary
          is bound or affected; except in the case of each of clauses (ii) and (iii),
such           as could not have or reasonably be expected to result in a Material
Adverse           Effect.  </FONT></P></TD>
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<font size=2>8</font></p>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Filings,
Consents and Approvals</U>. Except as set forth on <U>Schedule           3.1(e)</U>, the
Company is not 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 the
Transaction Documents, other           than: (i) the filings required pursuant to Section
4.4 of this Agreement, (ii)           the filing with the Commission of the Prospectus
Supplement, (iii)           application(s) to each applicable Trading Market for the
listing of the           Securities for trading thereon in the time and manner required
thereby and (iv)           such filings as are required to be made under applicable state
securities laws           and Nasdaq regulations (collectively, the &#147;<U>Required
          Approvals</U>&#148;).  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Issuance
of the Securities; Registration</U>. The Securities are duly           authorized and,
when issued and paid for in accordance with the applicable           Transaction
Documents, will be duly and validly issued, fully paid and           nonassessable, free
and clear of all Liens imposed by the Company. The Warrant           Shares, when issued
in accordance with the terms of the Warrants, will be           validly issued, fully
paid and nonassessable, free and clear of all Liens           imposed by the Company. The
Company has reserved from its duly authorized           capital stock the maximum number
of shares of Common Stock issuable pursuant to           this Agreement and the Warrants.
The Company has prepared and filed the           Registration Statement in conformity
with the requirements of the Securities           Act, which Registration Statement was
declared effective on&nbsp;July 1, 2008           (the &#147;<U>Effective Date</U>&#148;),
including the Prospectus, and such           amendments and supplements thereto as may
have been required to the date of this           Agreement. The Registration Statement is
effective under the Securities Act and           no stop order preventing or suspending
the effectiveness of the Registration           Statement or suspending or preventing the
use of the Prospectus has been issued           by the Commission and no proceedings for
that purpose have been instituted or,           to the knowledge of the Company, are
threatened by the Commission. The Company,           if required by the rules and
regulations of the Commission, proposes to file the           Prospectus Supplement with
the Commission pursuant to Rule 424(b). At the time           the Registration Statement
and any amendments thereto became effective, at the           date of this Agreement and
at the Closing Date, the Registration Statement and           any amendments thereto
conformed and will conform in all material respects to           the requirements of the
Securities Act and did not and will not contain any           untrue statement of a
material fact or omit to state any material fact required           to be stated therein
or necessary to make the statements therein not misleading;           and the Prospectus
and any amendments or supplements thereto, at the time the           Prospectus or any
amendment or supplement thereto was issued and at the Closing           Date, conformed
and will conform in all material respects to the requirements of           the Securities
Act and did not and will not contain an untrue statement of a           material fact or
omit to state a material fact necessary in order to make the           statements
therein, in light of the circumstances under which they were made,           not
misleading.  </FONT></P></TD>
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<p align=center>
<font size=2>9</font></p>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Capitalization</U>.
The capitalization of the Company is as set forth on <U>Schedule 3.1(g)</U>. The Company
has not issued any capital stock since its           most recently filed periodic report
under the Exchange Act, other than pursuant           to the exercise of employee stock
options under the Company&#146;s stock option           plans, the issuance of shares of
Common Stock to employees pursuant to the           Company&#146;s employee stock
purchase plans and pursuant to the conversion           and/or exercise of Common Stock
Equivalents outstanding as of the date of the           most recently filed periodic
report under the Exchange Act. No Person has any           right of first refusal,
preemptive right, right of participation, or any similar           right to participate
in the transactions contemplated by the Transaction           Documents. Except as a
result of the purchase and sale of the Securities, there           are no outstanding
options, warrants, scrip rights to subscribe to, calls or           commitments of any
character whatsoever relating to, or securities, rights or           obligations
convertible into or exercisable or exchangeable for, or giving any           Person any
right to subscribe for or acquire, any shares of Common Stock, or           contracts,
commitments, understandings or arrangements by which the Company or           any
Subsidiary is or may become bound to issue additional shares of Common Stock           or
Common Stock Equivalents. The issuance and sale of the Securities will not
          obligate the Company to issue shares of Common Stock or other securities to any
          Person (other than the Purchasers) and will not result in a right of any holder
          of Company securities to adjust the exercise, conversion, exchange or reset
          price under any of 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 or others is required
          for the issuance and sale of the Securities. There are no stockholders
          agreements, voting agreements or other similar agreements with respect to the
          Company&#146;s capital stock to which the Company is a party or, to the
          knowledge of the Company, between or among any of the Company&#146;s
          stockholders.  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(h)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>SEC
Reports; Financial Statements</U>. The Company has filed all reports,
          schedules, forms, statements and other documents required to be filed by the
          Company 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 or regulation to file
          such material) (the foregoing materials, including the exhibits thereto and
          documents incorporated by reference therein, together with the Prospectus and
          the Prospectus Supplement, being collectively referred to herein as the
          &#147;<U>SEC Reports</U>&#148;) on a timely basis or has received a valid
          extension of such time of filing and has filed any such SEC Reports prior to
the           expiration of any such extension. As of their respective dates, the SEC
Reports           complied in all material respects with the requirements of the
Securities Act           and the Exchange Act, as applicable, 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 never been an issuer subject to
Rule 144(i) under           the Securities Act. The financial statements of the Company
included in the SEC           Reports comply in all material respects with applicable
accounting requirements           and the rules and regulations of the Commission with
respect thereto as in           effect at the time of filing. Such financial statements
have been prepared in           accordance with United States generally accepted
accounting principles           (&#147;<U>GAAP</U>&#148;) applied on a consistent basis
during the periods           involved, except as may be otherwise specified in such
financial statements or           the notes thereto and except that unaudited financial
statements may not contain           all footnotes required by GAAP, and fairly present
in all material respects the           financial position of the Company and its
consolidated subsidiaries as of and           for the dates thereof and the results of
operations and cash flows for the           periods then ended, subject, in the case of
unaudited statements, to normal,           immaterial, year-end audit adjustments.  </FONT></P></TD>
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<font size=2>10</font></p>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Material
Changes; Undisclosed Events, Liabilities or Developments</U>. Since           the date of
the latest audited financial statements included within the SEC           Reports, except
as specifically disclosed in a subsequent SEC Report filed prior           to the date
hereof, (i) there has been no event, occurrence or development that           has had or
that could reasonably be expected to result in 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&#146;s financial statements pursuant           to GAAP or
disclosed in filings made with the Commission, (iii) the Company has           not
altered its method of accounting, (iv) the Company has not declared or made           any
dividend or distribution of cash or other property to its stockholders or
          purchased, redeemed or made any agreements to purchase or redeem any shares of
          its capital stock and (v) the Company has not issued any equity securities to
          any officer, director or Affiliate, except pursuant to existing Company stock
          option plans. The Company does not have pending before the Commission any
          request for confidential treatment of information. Except for the issuance of
          the Securities contemplated by this Agreement or as set forth on <U>Schedule
          3.1(i)</U>, no event, liability or development has occurred or exists with
          respect to the Company or its Subsidiaries or their respective business,
          properties, operations or financial condition, that would be required to be
          disclosed by the Company under applicable securities laws at the time this
          representation is made or deemed made that has not been publicly disclosed at
          least 1 Trading Day prior to the date that this representation is made.  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(j)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Litigation</U>.
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, any Subsidiary or any of their           respective properties
before or by any court, arbitrator, governmental or           administrative agency or
regulatory authority (federal, state, county, local or           foreign) (collectively,
an &#147;<U>Action</U>&#148;) which (i) adversely           affects or challenges the
legality, validity or enforceability of any of the           Transaction Documents or the
Securities or (ii) could, if there were an           unfavorable decision, have or
reasonably be expected to result in a Material           Adverse Effect. Neither the
Company nor any Subsidiary, nor any director or           officer thereof, is or has been
the subject of any Action involving a claim of           violation of or liability under
federal or state securities laws or a claim of           breach of fiduciary duty. 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 Subsidiary under the
Exchange Act or the Securities Act.  </FONT></P></TD>
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<p align=center>
<font size=2>11</font></p>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(k)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Labor
Relations</U>. No material labor dispute exists or, to the knowledge of           the
Company, is imminent with respect to any of the employees of the Company,           which
could reasonably be expected to result in a Material Adverse Effect. None           of
the Company&#146;s or its Subsidiaries&#146; employees is a member of a union
          that relates to such employee&#146;s relationship with the Company or such
          Subsidiary, and neither the Company nor any of its Subsidiaries is a party to a
          collective bargaining agreement, and the Company and its Subsidiaries believe
          that their relationships with their employees are good. No executive officer,
to           the knowledge of the Company, is, or is now expected to be, in violation of
any           material term of any employment contract, confidentiality, disclosure or
          proprietary information agreement or non-competition agreement, or any other
          contract or agreement or any restrictive covenant in favor of any third party,
          and the continued employment of each such executive officer does not subject
the           Company or any of its Subsidiaries to any liability with respect to any of
the           foregoing matters. The Company and its Subsidiaries are in compliance with
all           U.S. federal, state, local and foreign laws and regulations relating to
          employment and employment practices, terms and conditions of employment and
          wages and hours, except where the failure to be in compliance could not,
          individually or in the aggregate, reasonably be expected to have a Material
          Adverse Effect.  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(l)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Compliance</U>.
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 and all such laws that affect the environment, except           in each case as
could not have or reasonably be expected to result in a Material           Adverse
Effect.  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(m)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Regulatory
Permits</U>. The Company and the Subsidiaries possess all           certificates,
authorizations and permits issued by the appropriate federal,           state, local or
foreign regulatory authorities necessary to conduct their           respective businesses
as described in the SEC Reports, except where the failure           to possess such
permits could not reasonably be expected to result in a Material           Adverse Effect
(&#147;<U>Material Permits</U>&#148;), and neither the Company           nor any
Subsidiary has received any notice of proceedings relating to the           revocation or
modification of any Material Permit.  </FONT></P></TD>
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<p align=center>
<font size=2>12</font></p>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(n)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Title
to Assets</U>. The Company and the Subsidiaries have good and           marketable title
in fee simple to all real property owned by them and good and           marketable title
in all personal property owned by them that is material to the           business of the
Company and the Subsidiaries, in each case free and clear of all           Liens, except
for Liens as do not materially affect the value of such property           and do not
materially interfere with the use made and proposed to be made of           such property
by the Company and the Subsidiaries and Liens for the payment of           federal, state
or other taxes, the payment of which is neither delinquent nor           subject to
penalties. Any real property and facilities held under lease by the           Company and
the Subsidiaries are held by them under valid, subsisting and           enforceable
leases with which the Company and the Subsidiaries are in           compliance.  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(o)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Patents
and Trademarks</U>. To the knowledge of the Company, the Company and           the
Subsidiaries have, or have rights to use, all patents, patent applications,
          trademarks, trademark applications, service marks, trade names, trade secrets,
          inventions, copyrights, licenses and other intellectual property rights and
          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 &#147;<U>Intellectual
          Property Rights</U>&#148;). Neither the Company nor any Subsidiary has received
          a notice (written or otherwise) that any of 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. The Company and its Subsidiaries
          have taken reasonable security measures to protect the secrecy, confidentiality
          and value of all of their intellectual properties, except where failure to do
so           could not, individually or in the aggregate, reasonably be expected to have
a           Material Adverse Effect.  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(p)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Insurance</U>.
The Company and the Subsidiaries are insured by insurers of           recognized
financial responsibility against such losses and risks and in such           amounts as
are prudent and customary in the businesses in which the Company and           the
Subsidiaries are engaged, including, but not limited to, directors and           officers
insurance coverage at least equal to the aggregate Subscription Amount.           Neither
the Company nor any Subsidiary has any reason to believe that it will           not be
able to renew its existing insurance coverage as and when such coverage           expires
or to obtain similar coverage from similar insurers as may be necessary           to
continue its business without a significant increase in cost.  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(q)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Transactions
With Affiliates and Employees</U>. Except as set forth in the           SEC Reports, 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 $120,000 other than for (i) payment of salary           or consulting
fees for services rendered, (ii) reimbursement for expenses           incurred on behalf
of the Company and (iii) other employee benefits, including           stock option
agreements under any stock option plan of the Company.  </FONT></P></TD>
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<p align=center>
<font size=2>13</font></p>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(r)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Sarbanes-Oxley;
Internal Accounting Controls</U>. The Company is in material           compliance with
all provisions of the Sarbanes-Oxley Act of 2002 which are           applicable to it as
of the Closing Date. The Company and the Subsidiaries           maintain a system of
internal accounting controls sufficient to provide           reasonable assurance that:
(i) transactions are executed in accordance with           management&#146;s general or
specific authorizations, (ii) transactions are           recorded as necessary to permit
preparation of financial statements in           conformity with GAAP and to maintain
asset accountability, (iii) access to           assets is permitted only in accordance
with management&#146;s general or           specific authorization, and (iv) the recorded
accountability for assets is           compared with the existing assets at reasonable
intervals and appropriate action           is taken with respect to any differences. The
Company has established disclosure           controls and procedures (as defined in
Exchange Act Rules 13a-15(e) and           15d-15(e)) for the Company and designed such
disclosure controls and procedures           to ensure that information required to be
disclosed by the Company in the           reports it files or submits under the Exchange
Act is recorded, processed,           summarized and reported, within the time periods
specified in the           Commission&#146;s rules and forms. The Company&#146;s
certifying officers have           evaluated the effectiveness of the Company&#146;s
disclosure controls and           procedures as of the end of the period covered by the
Company&#146;s most           recently filed periodic report under the Exchange Act (such
date, the           &#147;<U>Evaluation Date</U>&#148;). The Company presented in its
most recently           filed periodic report under the Exchange Act the conclusions of
the certifying           officers about the effectiveness of the disclosure controls and
procedures based           on their evaluations as of the Evaluation Date. Since the
Evaluation Date, there           have been no changes in the Company&#146;s internal
control over financial           reporting (as such term is defined in the Exchange Act)
that has materially           affected, or is reasonably likely to materially affect, the
Company&#146;s           internal control over financial reporting.  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(s)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Certain
Fees</U>. Except as set forth in the Prospectus Supplement, no           brokerage or
finder&#146;s fees or commissions are or will be payable by the           Company to any
broker, financial advisor or consultant, finder, placement agent,           investment
banker, bank or other Person with respect to the transactions           contemplated by
the Transaction Documents. The Purchasers shall have no           obligation with respect
to any fees or with respect to any claims made by or on           behalf of other Persons
for fees of a type contemplated in this Section that may           be due in connection
with the transactions contemplated by the Transaction           Documents.  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(t)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Investment
Company</U>. The Company is not, and is not an Affiliate of, and           immediately
after receipt of payment for the Securities, will not be or be an           Affiliate of,
an &#147;investment company&#148; within the meaning of the           Investment Company
Act of 1940, as amended. The Company shall conduct its           business in a manner so
that it will not become subject to the Investment           Company Act of 1940, as
amended.  </FONT></P></TD>
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<p align=center>
<font size=2>14</font></p>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(u)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Registration
Rights</U>. Except as set forth on <U>Schedule 3.1(u)</U>, no           Person has any
right to cause the Company to effect the registration under the           Securities Act
of any securities of the Company.  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(v)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Listing
and Maintenance Requirements</U>. The Common Stock is registered           pursuant to
Section 12(b) or 12(g) of the Exchange Act, and the Company has           taken no action
designed to, or which to its knowledge is likely to have the           effect of,
terminating the registration of the Common Stock under the Exchange           Act nor has
the Company received any notification that the Commission is           contemplating
terminating such registration. The Company has not, in the 12           months preceding
the date hereof, received notice from any Trading Market on           which the Common
Stock is or has been listed or quoted to the effect that the           Company is not in
compliance with the listing or maintenance requirements of           such Trading Market.
The Company is, and has no reason to believe that it will           not in the
foreseeable future continue to be, in compliance with all such           listing and
maintenance requirements.  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(w)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Application
of Takeover Protections</U>. The Company and the Board of           Directors have taken
all necessary action, if any, in order to render           inapplicable any control share
acquisition, business combination, poison pill           (including any distribution
under a rights agreement) or other similar           anti-takeover provision under the
Company&#146;s certificate of incorporation           (or similar charter documents) or
the laws of its state of incorporation that is           or could become applicable to
the Purchasers as a result of the Purchasers and           the Company fulfilling their
obligations or exercising their rights under the           Transaction Documents,
including without limitation as a result of the           Company&#146;s issuance of the
Securities and the Purchasers&#146; ownership of           the Securities.  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(x)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Disclosure</U>.
Except with respect to the material terms and conditions of           the transactions
contemplated by the Transaction Documents, the Company confirms           that neither it
nor any other Person acting on its behalf has provided any of           the Purchasers or
their agents or counsel with any information that it believes           constitutes or
might constitute material, non-public information which is not           otherwise
disclosed in the Prospectus Supplement. The Company understands and           confirms
that the Purchasers will rely on the foregoing representation in           effecting
transactions in securities of the Company. All disclosure furnished by           or on
behalf of the Company to the Purchasers regarding the Company, its           business and
the transactions contemplated hereby, including the Disclosure           Schedules to
this Agreement, is true and correct and does not contain any untrue           statement
of a material fact or omit to state any material fact necessary in           order to
make the statements made therein, in light of the circumstances under           which
they were made, not misleading. The press releases disseminated by the           Company
during the twelve months preceding the date of this Agreement taken as a           whole
do not contain any untrue statement of a material fact or omit to state a
          material fact required to be stated therein or necessary in order to make the
          statements therein, in light of the circumstances under which they were made
and           when made, not misleading. The Company acknowledges and agrees that no
Purchaser           makes or has made any representations or warranties with respect to
the           transactions contemplated hereby other than those specifically set forth in
          Section 3.2 hereof.  </FONT></P></TD>
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<p align=center>
<font size=2>15</font></p>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(y)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>No
Integrated Offering</U>. Assuming the accuracy of the Purchasers&#146;          representations
and warranties set forth in Section 3.2, neither the Company,           nor any of its
Affiliates, nor any Person acting on its or their behalf has,           directly or
indirectly, made any offers or sales of any security or solicited           any offers to
buy any security, under circumstances that would cause this           offering of the
Securities to be integrated with prior offerings by the Company           for purposes of
any applicable shareholder approval provisions of any Trading           Market on which
any of the securities of the Company are listed or designated.  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(z)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Solvency</U>.
Based on the consolidated financial condition of the Company as           of the Closing
Date, after giving effect to the receipt by the Company of the           proceeds from
the sale of the Securities hereunder, (i) the fair saleable value           of the Company&#146;s
assets exceeds the amount that will be required to be paid           on or in respect of
the Company&#146;s existing debts and other liabilities           (including known
contingent liabilities) as they mature, (ii) the Company&#146;s           assets do not
constitute unreasonably small capital to carry on its business as           now conducted
and as proposed to be conducted including its capital needs taking           into account
the particular capital requirements of the business conducted by           the Company,
and projected capital requirements and capital availability           thereof, and (iii)
the current cash flow of the Company, together with the           proceeds the Company
would receive, were it to liquidate all of its assets,           after taking into
account all anticipated uses of the cash, would be sufficient           to pay all
amounts on or in respect of its liabilities when such amounts are           required to
be paid. The Company does not intend to incur debts beyond its           ability to pay
such debts as they mature (taking into account the timing and           amounts of cash
to be payable on or in respect of its debt). The Company has no           knowledge of
any facts or circumstances which lead it to believe that it will           file for
reorganization or liquidation under the bankruptcy or reorganization           laws of
any jurisdiction within one year from the Closing Date. <U>Schedule           3.1(z)</U> sets
forth as of the date thereof all outstanding secured and           unsecured Indebtedness
of the Company or any Subsidiary, or for which the           Company or any Subsidiary
has commitments. For the purposes of this Agreement,           &#147;<U>Indebtedness</U>&#148; means
(x) any liabilities for borrowed money or           amounts owed in excess of $50,000
(other than trade accounts payable incurred in           the ordinary course of
business), (y) all guaranties, endorsements and other           contingent obligations in
respect of indebtedness of others, whether or not the           same are or should be
reflected in the Company&#146;s balance sheet (or the           notes thereto), except
guaranties by endorsement of negotiable instruments for           deposit or collection
or similar transactions in the ordinary course of           business; and (z) the present
value of any lease payments in excess of $50,000           due under leases required to
be capitalized in accordance with GAAP. Neither the           Company nor any Subsidiary
is in default with respect to any Indebtedness.  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(aa)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Tax
Status</U>. 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.  </FONT></P></TD>
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<p align=center>
<font size=2>16</font></p>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(bb)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Foreign
Corrupt Practices</U>. 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 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.  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(cc)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Accountants</U>.
The Company&#146;s accounting firm is set forth on <U>Schedule 3.1(cc)</U> of the
Disclosure Schedules. To the knowledge and belief           of the Company, such
accounting firm (i) is a registered public accounting firm           as required by the
Exchange Act and (ii) shall express its opinion with respect           to the financial
statements to be included in the Company&#146;s Annual Report           for the year
ended December 31, 2008.  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(dd)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Acknowledgment
Regarding Purchasers&#146; Purchase of Securities</U>. The           Company acknowledges
and agrees that each of the Purchasers is acting solely in           the capacity of an
arm&#146;s length purchaser with respect to the Transaction           Documents and the
transactions contemplated thereby. The Company further           acknowledges that no
Purchaser is acting as a financial advisor or fiduciary of           the Company (or in
any similar capacity) with respect to the Transaction           Documents and the
transactions contemplated thereby and any advice given by any           Purchaser or any
of their respective representatives or agents in connection           with the
Transaction Documents and the transactions contemplated thereby is           merely
incidental to the Purchasers&#146; purchase of the Securities. The           Company
further represents to each Purchaser that the Company&#146;s decision to           enter
into this Agreement and the other Transaction Documents has been based           solely
on the independent evaluation of the transactions contemplated hereby by           the
Company and its representatives.  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(ee)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Acknowledgement
Regarding Purchaser&#146;s Trading Activity</U>. Anything in           this Agreement or
elsewhere herein to the contrary notwithstanding (except for           Sections 3.2(e)
and 4.14 hereof), it is understood and acknowledged by the           Company that: (i)
none of the Purchasers have been asked by the Company to           agree, nor has any
Purchaser agreed, to desist from purchasing or selling, long           and/or short,
securities of the Company, or &#147;derivative&#148; securities           based on
securities issued by the Company or to hold the Securities for any           specified
term; (ii) that past or future open market or other transactions by           any
Purchaser, specifically including, without limitation, Short Sales or           &#147;derivative&#148; transactions,
before or after the closing of this           transaction, may negatively impact the
market price of the Company&#146;s           publicly-traded securities; (iii) that any
Purchaser, and counter-parties in           &#147;derivative&#148; transactions to which
any such Purchaser is a party,           directly or indirectly, presently may have a
&#147;short&#148; position in the           Common Stock, and (iv) that each Purchaser
shall not be deemed to have any           affiliation with or control over any arm&#146;s
length counter-party in any           &#147;derivative&#148; transaction. The Company
further understands and           acknowledges that (y) one or more Purchasers may engage
in hedging activities at           various times during the period that the Securities
are outstanding, including,           without limitation, during the periods that the
value of the Warrant Shares           deliverable with respect to Securities are being
determined, and (z) such           hedging activities (if any) could reduce the value of
the existing           stockholders&#146; equity interests in the Company at and after
the time that           the hedging activities are being conducted.&nbsp; The Company
acknowledges that           such aforementioned hedging activities do not constitute a
breach of any of the           Transaction Documents.  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(ff)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Regulation
M Compliance</U>.&nbsp; The Company has not, and to its knowledge           no one acting
on its behalf has, (i) taken, directly or indirectly, any action           designed to
cause or to result in the stabilization or manipulation of the price           of any
security of the Company to facilitate the sale or resale of any of the
          Securities, (ii) sold, bid for, purchased, or, paid any compensation for
          soliciting purchases of, any of the Securities, or (iii) paid or agreed to pay
          to any Person any compensation for soliciting another to purchase any other
          securities of the Company, other than, in the case of clauses (ii) and (iii),
          compensation paid to the Company&#146;s placement agent in connection with the
          placement of the Securities.  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;(gg)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>FDA</U>.
As to each product subject to the jurisdiction of the U.S. Food and Drug
Administration (&#147;<U>FDA</U>&#148;) under the Federal Food, Drug and Cosmetic Act,
as amended, and the regulations thereunder (&#147;<U>FDCA</U>&#148;) that is
manufactured, packaged, labeled, tested, distributed, sold, and/or marketed by
the Company or any of its Subsidiaries (each such product, a &#147;<U>Pharmaceutical
Product</U>&#148;), such Pharmaceutical Product is being manufactured,
packaged, labeled, tested, distributed, sold and/or marketed by the Company in
compliance with all applicable requirements under FDCA and similar laws, rules
and regulations relating to registration, investigational use, premarket
clearance, licensure, or application approval, good manufacturing practices,
good laboratory practices, good clinical practices, product listing, quotas,
labeling, advertising, record keeping and filing of reports, except where the
failure to be in compliance would not have a Material Adverse Effect. There is
no pending, completed or, to the Company&#146;s knowledge, threatened, action
(including any lawsuit, arbitration, or legal or administrative or regulatory
proceeding, charge, complaint, or investigation) against the Company or any of
its Subsidiaries, and none of the Company or any of its Subsidiaries has
received any notice, warning letter or other communication from the FDA or any
other governmental entity, which (i) contests the premarket clearance,
licensure, registration, or approval of, the uses of, the distribution of, the
manufacturing or packaging of, the testing of, the sale of, or the labeling and
promotion of any Pharmaceutical Product, (ii) withdraws its approval of,
requests the recall, suspension, or seizure of, or withdraws or orders the
withdrawal of advertising or sales promotional materials relating to, any
Pharmaceutical Product, (iii) imposes a clinical hold on any clinical
investigation by the Company or any of its Subsidiaries, (iv) enjoins
production at any facility of the Company or any of its Subsidiaries, (v)
enters or proposes to enter into a consent decree of permanent injunction with
the Company or any of its Subsidiaries, or (vi) otherwise alleges any violation
of any laws, rules or regulations by the Company or any of its Subsidiaries,
and which, either individually or in the aggregate, would have a Material
Adverse Effect. The properties, business and operations of the Company have
been and are being conducted in all material respects in accordance with all
applicable laws, rules and regulations of the FDA.&nbsp; The Company has not
been informed by the FDA that the FDA will prohibit the marketing, sale,
license or use in the United States of any product proposed to be developed,
produced or marketed by the Company nor has the FDA expressed any concern as to
approving or clearing for marketing any product being developed or proposed to
be developed by the Company. </FONT> </P></TD>
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<p align=center>
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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;3.2 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Representations
and Warranties of the Purchasers</U>. Each Purchaser, for itself and for no other
Purchaser, hereby represents and warrants as of the date hereof and as of the Closing
Date to the Company as follows:  </FONT></P>

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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Organization;
Authority</U>. Such Purchaser is an entity duly organized,           validly existing and
in good standing under the laws of the jurisdiction of its           organization with
full right, corporate or partnership power and authority to           enter into and to
consummate the transactions contemplated by this Agreement and           otherwise to
carry out its obligations hereunder and thereunder. The execution           and delivery
of this Agreement and performance by such Purchaser of the           transactions
contemplated by this Agreement have been duly authorized by all           necessary
corporate or similar action on the part of such Purchaser. Each           Transaction
Document to which it is a party has been duly executed by such           Purchaser, and
when delivered by such Purchaser in accordance with the terms           hereof, will
constitute the valid and legally binding obligation of such           Purchaser,
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&#146; rights generally, (ii) as limited by laws
          relating to the availability of specific performance, injunctive relief or
other           equitable remedies and (iii) insofar as indemnification and contribution
          provisions may be limited by applicable law.  </FONT></P></TD>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Own
Account</U>. Such Purchaser is acquiring the Securities as principal for           its
own account and not with a view to or for distributing or reselling such
          Securities or any part thereof in violation of the Securities Act or any
          applicable state securities law, has no present intention of distributing any
of           such Securities in violation of the Securities Act or any applicable state
          securities law and has no direct or indirect arrangement or understandings with
          any other persons to distribute or regarding the distribution of such
Securities           (this representation and warranty not limiting such Purchaser&#146;s
right to           sell the Securities pursuant to the Registration Statement or
otherwise in           compliance with applicable federal and state securities laws) in
violation of           the Securities Act or any applicable state securities law. Such
Purchaser is           acquiring the Securities hereunder in the ordinary course of its
business.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Purchaser
Status</U>. At the time such Purchaser was offered the Securities,           it was, and
as of the date hereof it is, and on each date on which it exercises           any
Warrants, it will be either: (i) an &#147;accredited investor&#148; as           defined
in Rule 501(a)(1), (a)(2), (a)(3), (a)(7) or (a)(8) under the Securities           Act or
(ii) a &#147;qualified institutional buyer&#148; as defined in Rule           144A(a)
under the Securities Act. Such Purchaser is not required to be           registered as a
broker-dealer under Section 15 of the Exchange Act.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

<p align=center>
<font size=2>19</font></p>
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<page>

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<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Experience
of Such Purchaser</U>. Such Purchaser, 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 Securities, and has so evaluated the           merits
and risks of such investment. Such Purchaser is able to bear the economic           risk
of an investment in the Securities and, at the present time, is able to           afford
a complete loss of such investment.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Short
Sales and Confidentiality Prior To The Date Hereof</U>. Other than           consummating
the transactions contemplated hereunder, such Purchaser has not,           nor has any
Person acting on behalf of or pursuant to any understanding with           such
Purchaser, directly or indirectly executed any purchases or sales,           including
Short Sales,&nbsp;of the securities of the Company during the period           commencing
from the time that such Purchaser first received a term sheet           (written or oral)
from the Company or any other Person representing the Company           setting forth the
material terms of the transactions contemplated hereunder           (&#147;<U>Discussion
Time</U>&#148;). Notwithstanding the foregoing, in the case           of a Purchaser that
is a multi-managed investment vehicle whereby separate           portfolio managers
manage separate portions of such Purchaser&#146;s assets and           the portfolio
managers have no direct knowledge of the investment decisions made           by the
portfolio managers managing other portions of such Purchaser&#146;s           assets, the
representation set forth above shall only apply with respect to the           portion of
assets managed by the portfolio manager that made the investment           decision to
purchase the Securities covered by this Agreement. Other than to           other Persons
party to this Agreement, such Purchaser has maintained the           confidentiality of
all disclosures made to it in connection with this           transaction (including the
existence and terms of this transaction).           Notwithstanding the foregoing, for
avoidance of doubt, nothing contained herein           shall constitute a representation
or warranty, or preclude any actions, with           respect to the identification of the
availability of, or securing of, available           shares to borrow in order to effect
short sales or similar transactions in the           future.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company acknowledges and agrees that the representations contained in Section 3.2 shall
not modify, amend or affect such Purchaser&#146;s right to rely on the Company&#146;s
representations and warranties contained in this Agreement or any representations and
warranties contained in any other Transaction Document or any other document or instrument
executed and/or delivered in connection with this Agreement or the consummation of the
transaction contemplated hereby. </FONT></P>

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<P ALIGN=center><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>ARTICLE IV.</B> </FONT> <BR>
<FONT FACE="Times New Roman, Times, Serif" SIZE=2>OTHER AGREEMENTS OF THE
PARTIES </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.1 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Warrant
Shares</U>.   If all or any portion of a Warrant is exercised at a time when there is
an effective registration statement to cover the issuance or resale of the Warrant Shares
or if the Warrant is exercised via cashless exercise, the Warrant Shares issued pursuant
to any such exercise shall be issued free of all legends. If at any time following the
date hereof the Registration Statement (or any subsequent registration statement
registering the Warrant Shares) is not effective or is not otherwise available for the
sale or resale of the Warrant Shares, the Company shall immediately notify the holders of
the Warrants in writing that such registration statement is not then effective and
thereafter shall promptly notify such holders when the registration statement is
effective again and available for the sale or resale of the Warrant Shares. The Company
shall use best efforts to keep a registration statement (including the Registration
Statement) registering the issuance or resale of the Warrant Shares effective during the
term of the Warrants. Upon a cashless exercise of the Warrants, the holding period for
purposes of Rule 144 shall tack back to the original date of issuance of such Warrant.  </FONT></P>

<p align=center>
<font size=2>20</font></p>
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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.2 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Furnishing
of Information</U>. Until the earliest of the time that (i) no Purchaser owns Securities
or (ii) the Warrants have expired, the Company covenants to timely file (or obtain
extensions in respect thereof and file within the applicable grace period) all reports
required to be filed by the Company after the date hereof pursuant to the Exchange Act
even if the Company is not then subject to the reporting requirements of the Exchange
Act. As long as any Purchaser owns Securities, if the Company is not required to file
reports pursuant to the Exchange Act, it will prepare and furnish to the Purchasers and
make publicly available in accordance with Rule 144(c) such information, if any, as is
required for the Purchasers to sell the Securities under Rule 144. The Company further
covenants that it will take such further action as any holder of Securities may
reasonably request, to the extent required from time to time to enable such Person to
sell such Securities without registration under the Securities Act within the
requirements of the exemption provided by Rule 144.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.3 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Integration</U>.
The Company shall not sell, offer for sale or solicit offers to buy or otherwise
negotiate in respect of any security (as defined in Section 2 of the Securities Act) that
would be integrated with the offer or sale of the Securities for purposes of the rules
and regulations of any Trading Market such that it would require shareholder approval
prior to the closing of such other transaction unless shareholder approval is obtained
before the closing of such subsequent transaction.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.4 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Securities
Laws Disclosure; Publicity</U>. The Company shall, by 8:30 a.m. (New York City time) on
the Trading Day immediately following the date hereof, issue a Current Report on Form
8-K, disclosing the material terms of the transactions contemplated hereby, and including
the Transaction Documents as exhibits thereto. The Company and each Purchaser shall
consult with each other in issuing any other press releases with respect to the
transactions contemplated hereby, and neither the Company nor any Purchaser shall issue
any such press release nor otherwise make any such public statement without the prior
consent of the Company, with respect to any press release of any Purchaser, or without
the prior consent of each Purchaser, with respect to any press release of the Company,
which consent shall not unreasonably be withheld or delayed, except if such disclosure is
required by law, in which case the disclosing party shall promptly provide the other
party with prior notice of such public statement or communication. Notwithstanding the
foregoing, the Company shall not publicly disclose the name of any Purchaser, or include
the name of any Purchaser in any filing with the Commission or any regulatory agency or
Trading Market, without the prior written consent of such Purchaser, except (a) as
required by federal securities law in connection with the filing of final Transaction
Documents (including signature pages thereto) with the Commission and (b) to the extent
such disclosure is required by law or Trading Market regulations, in which case the
Company shall provide the Purchasers with prior notice of such disclosure permitted under
this clause (b).  </FONT></P>

<p align=center>
<font size=2>21</font></p>
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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.5 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Shareholder
Rights Plan</U>. No claim will be made or enforced by the Company or, with the consent of
the Company, by any other Person, that any Purchaser is an &#147;Acquiring Person&#148; under
any control share acquisition, business combination, poison pill (including any
distribution under a rights agreement) or similar anti-takeover plan or arrangement in
effect or hereafter adopted by the Company, or that any Purchaser could be deemed to
trigger the provisions of any such plan or arrangement, in each case by virtue of
receiving Securities under the Transaction Documents or under any other agreement between
the Company and the Purchasers.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.6 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Non-Public
Information</U>. Except with respect to the material terms and conditions of the
transactions contemplated by the Transaction Documents, the Company covenants and agrees
that neither it, nor any other Person acting on its behalf will provide any Purchaser or
its agents or counsel with any information that the Company believes constitutes material
non-public information, unless prior thereto such Purchaser shall have executed a written
agreement regarding the confidentiality and use of such information. The Company
understands and confirms that each Purchaser shall be relying on the foregoing covenant
in effecting transactions in securities of the Company.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.7 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Use
of Proceeds</U>. Except as set forth on <U>Schedule 4.7</U> attached hereto, the Company
shall use the net proceeds from the sale of the Securities hereunder for working capital
purposes and shall not use such proceeds for: (a) the satisfaction of any portion of the
Company&#146;s debt (other than payment of trade payables in the ordinary course of the
Company&#146;s business and prior practices), (b) the redemption of any Common Stock or
Common Stock Equivalents or (c) the settlement of any outstanding litigation.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.8 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Indemnification
of Purchasers</U>. Subject to the provisions of this Section 4.8, the Company will
indemnify and hold each Purchaser and its directors, officers, shareholders, members,
partners, employees and agents (and any other Persons with a functionally equivalent role
of a Person holding such titles notwithstanding a lack of such title or any other title),
each Person who controls such Purchaser (within the meaning of Section 15 of the
Securities Act and Section 20 of the Exchange Act), and the directors, officers,
shareholders, agents, members, partners or employees (and any other Persons with a
functionally equivalent role of a Person holding such titles notwithstanding a lack of
such title or any other title) of such controlling persons (each, a &#147;<U>Purchaser
Party</U>&#148;) harmless from any and all losses, liabilities, obligations, claims,
contingencies, damages, costs and expenses, including all judgments, amounts paid in
settlements, court costs and reasonable attorneys&#146; fees and costs of investigation
that any such Purchaser Party may suffer or incur as a result of or relating to (a) any
breach of any of the representations, warranties, covenants or agreements made by the
Company in this Agreement or in the other Transaction Documents or (b) any action
instituted against a Purchaser in any capacity, or any of them or their respective
Affiliates, by any stockholder of the Company who is not an Affiliate of such Purchaser,
with respect to any of the transactions contemplated by the Transaction Documents (unless
such action is based upon a breach of such Purchaser&#146;s representations, warranties
or covenants under the Transaction Documents or any agreements or understandings such
Purchaser may have with any such stockholder or any violations by the Purchaser of state
or federal securities laws or any conduct by such Purchaser which constitutes fraud,
gross negligence, willful misconduct or malfeasance). If any action shall be brought
against any Purchaser Party in respect of which indemnity may be sought pursuant to this
Agreement, such Purchaser Party shall promptly notify the Company in writing, and the
Company shall have the right to assume the defense thereof with counsel of its own
choosing reasonably acceptable to the Purchaser Party. Any Purchaser Party shall have the
right to employ separate counsel in any such action and participate in the defense
thereof, but the fees and expenses of such counsel shall be at the expense of such
Purchaser Party except to the extent that (i) the employment thereof has been
specifically authorized by the Company in writing, (ii) the Company has failed after a
reasonable period of time to assume such defense and to employ counsel or (iii) in such
action there is, in the reasonable opinion of such separate counsel, a material conflict
on any material issue between the position of the Company and the position of such
Purchaser Party, in which case the Company shall be responsible for the reasonable fees
and expenses of no more than one such separate counsel. The Company will not be liable to
any Purchaser Party under this Agreement (y) for any settlement by a Purchaser Party
effected without the Company&#146;s prior written consent, which shall not be
unreasonably withheld or delayed; or (z) to the extent, but only to the extent that a
loss, claim, damage or liability is attributable to any Purchaser Party&#146;s breach of
any of the representations, warranties, covenants or agreements made by such Purchaser
Party in this Agreement or in the other Transaction Documents.  </FONT></P>

<p align=center>
<font size=2>22</font></p>
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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.9 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Reservation
of Common Stock</U>. As of the date hereof, the Company has reserved and the Company
shall continue to reserve and keep available at all times, free of preemptive rights, a
sufficient number of shares of Common Stock for the purpose of enabling the Company to
issue Shares pursuant to this Agreement and Warrant Shares pursuant to any exercise of
the Warrants.<U></U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.10 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Listing
of Common Stock</U>.  The Company hereby agrees to use best efforts to maintain the
listing and quotation of the Common Stock on a Trading Market, and as soon as reasonably
practicable following the Closing (but not later than the Closing Date) to list or quote
all of the Shares and Warrant Shares on such Trading Market. The Company further agrees,
if the Company applies to have the Common Stock traded on any other Trading Market, it
will then include in such application all of the Shares and Warrant Shares, and will take
such other action as is necessary to cause all of the Shares and Warrant Shares to be
listed or quoted on such other Trading Market as promptly as possible. The Company will
then take all action reasonably necessary to continue the listing and trading of its
Common Stock on a Trading Market and will comply in all respects with the Company&#146;s
reporting, filing and other obligations under the bylaws or rules of the Trading Market.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.11 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Equal
Treatment of Purchasers</U>. No consideration shall be offered or paid to any Person to
amend or consent to a waiver or modification of any provision of any of the Transaction
Documents unless the same consideration is also offered to all of the parties to the
Transaction Documents. For clarification purposes, this provision constitutes a separate
right granted to each Purchaser by the Company and negotiated separately by each
Purchaser, and is intended for the Company to treat the Purchasers as a class and shall
not in any way be construed as the Purchasers acting in concert or as a group with
respect to the purchase, disposition or voting of Securities or otherwise.  </FONT></P>

<p align=center>
<font size=2>23</font></p>
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<page>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;4.12 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Participation
in Future Financing</U>. </FONT> </P>

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<TD ALIGN=RIGHT WIDTH=5%></TD>
<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;From
the date hereof until the date that is the 12 month anniversary of the date
          hereof, upon any issuance by the Company or any of its Subsidiaries of Common
          Stock, Common Stock Equivalents for cash consideration, Indebtedness (or a
          combination of units hereof) (a &#147;<U>Subsequent Financing</U>&#148;), each
          Purchaser shall have the right to participate in up to an amount of the
          Subsequent Financing equal to 25% of the Subsequent Financing (the
          &#147;<U>Participation Maximum</U>&#148;) on the same terms, conditions and
          price provided for in the Subsequent Financing.&nbsp; </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At
least one (1) Trading Day prior to the execution of definitive documents
          relating to the Subsequent Financing, the Company shall deliver to each
          Purchaser a written notice of its intention to effect a Subsequent Financing
          (&#147;<U>Pre-Notice</U>&#148;), which Pre-Notice shall ask such Purchaser if
it           wants to review the details of such financing (such additional notice, a
          &#147;<U>Subsequent Financing  Notice</U>&#148;).&nbsp; Upon the request of a
          Purchaser, and only upon a request by such Purchaser, for a Subsequent
Financing           Notice, the Company shall, immediately after the details of such
Subsequent           Financing are determined, deliver a Subsequent Financing Notice to
such           Purchaser upon which the Purchaser shall have 24 hours (which must include
          normal working hours during a Trading Day) to determine whether to
          participate.&nbsp; The Subsequent Financing Notice shall describe in reasonable
          detail the proposed terms of such Subsequent Financing, the amount of proceeds
          intended to be raised thereunder and the Person or Persons through or with whom
          such Subsequent Financing is proposed to be effected and shall include a term
          sheet or similar document relating thereto as an attachment.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any
Purchaser desiring to participate in such Subsequent Financing must provide
          written notice to the Company by not later than 24 hours (which must include
          normal working hours during a Trading Day) following the time that a Subsequent
          Financing Notice is delivered to the Purchaser that the Purchaser is willing to
          participate in the Subsequent Financing, the amount of the Purchaser&#146;s
          participation, and representing and warranting that the Purchaser has such
funds           ready, willing, and available for investment on the terms set forth in
the           Subsequent Financing Notice. If the Company receives no such notice from a
          Purchaser during such period, such Purchaser shall be deemed to have notified
          the Company that it does not elect to participate.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
the Purchasers willingness to participate in the Subsequent Financing (or to
          cause their designees to participate) is, in the aggregate, less than the total
          amount of the Subsequent Financing, then the Company may effect the remaining
          portion of such Subsequent Financing on the terms and with the Persons set
forth           in the Subsequent Financing Notice.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
the Company receives responses to a Subsequent Financing Notice from           Purchasers
seeking to purchase more than the aggregate amount of the           Participation
Maximum, each such Purchaser shall have the right to purchase its           Pro Rata
Portion (as defined below) of the Participation Maximum.&nbsp;          &#147;<U>Pro </U><U>Rata
Portion</U>&#148; means the ratio of (x) the           Subscription Amount of Securities
purchased on the Closing Date by a Purchaser           participating under this Section
4.12 and (y) the sum of the aggregate           Subscription Amounts of Securities
purchased on the Closing Date by all           Purchasers participating under this
Section 4.12.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

<p align=center>
<font size=2>24</font></p>
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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company must provide the Purchasers with a second Subsequent Financing           Notice,
and the Purchasers will again have the right of participation set forth           above
in this Section 4.12, if the Subsequent Financing subject to the initial
          Subsequent Financing Notice is not consummated for any reason on the terms set
          forth in such Subsequent Financing Notice within thirty (30) Trading Days after
          the date of the initial Subsequent Financing Notice.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=95%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding
the foregoing, this Section 4.12 shall not apply in respect of           (i) an Exempt
Issuance, or (ii) an underwritten public offering of its           securities.  </FONT></P></TD>
</TR>
</TABLE>
<BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.13 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Subsequent
Equity Sales</U>. From the date hereof until 30 days after the Closing Date, neither the
Company nor any Subsidiary shall issue shares of Common Stock or Common Stock
Equivalents.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.14 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Short
Sales and Confidentiality After The Date Hereof</U>. Each Purchaser, severally and not
jointly with the other Purchasers, covenants that neither it nor any Affiliate acting on
its behalf or pursuant to any understanding with it will execute any Short Sales during
the period commencing with the Discussion Time and ending at such time the transactions
contemplated by this Agreement are first publicly announced as described in Section 4.4.&nbsp; Each
Purchaser, severally and not jointly with the other Purchasers, covenants that until such
time as the transactions contemplated by this Agreement are publicly disclosed by the
Company as described in Section 4.4, such Purchaser will maintain the confidentiality of
the existence and terms of this transaction and the information included in the
Disclosure Schedules.&nbsp; Notwithstanding the foregoing, no Purchaser makes any
representation, warranty or covenant hereby that it will not engage in Short Sales in the
securities of the Company after the time that the transactions contemplated by this
Agreement are first publicly announced as described in Section 4.4.&nbsp; Notwithstanding
the foregoing, in the case of a Purchaser that is a multi-managed investment vehicle
whereby separate portfolio managers manage separate portions of such Purchaser&#146;s
assets and the portfolio managers have no direct knowledge of the investment decisions
made by the portfolio managers managing other portions of such Purchaser&#146;s assets,
the covenant set forth above shall only apply with respect to the portion of assets
managed by the portfolio manager that made the investment decision to purchase the
Securities covered by this Agreement.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.15 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Delivery
of Securities After Closing; Buy-In</U>. The Company shall deliver, or cause to be
delivered, the respective Securities purchased by each Purchaser to such Purchaser within
3 Trading Days of the Closing Date. In addition to any other rights available to the a
Purchaser, if the Company fails to cause the Transfer Agent to transmit to such Purchaser
it Shares within 3 Trading Days of the date required under this Agreement, and if after
such date the Purchaser is required by its broker to purchase (in an open market
transaction or otherwise) or the Purchaser&#146;s brokerage firm otherwise purchases,
shares of Common Stock to deliver in satisfaction of a sale by the Purchaser of the
Shares which the Purchaser was entitled to receive hereunder (a &#147;<U>Buy-In</U>&#148;),
then the Company shall (A) pay in cash to the Purchaser the amount, if any, by which (x)
the Purchaser&#146;s total purchase price (including brokerage commissions, if any) for
the shares of Common Stock so purchased exceeds (y) the amount obtained by multiplying
(1) the number of Shares that the Company was required to deliver to the Purchaser times
(2) the price at which the sell order giving rise to such purchase obligation was
executed, and (B) deliver to the Purchaser the number of shares of Common Stock that
would have been issued had the Company timely complied with its obligations hereunder.
Nothing herein shall limit a Purchaser&#146;s right to pursue any other remedies
available to it hereunder, at law or in equity including, without limitation, a decree of
specific performance and/or injunctive relief with respect to the Company&#146;s failure
to timely deliver certificates representing shares of Common Stock as required pursuant
to the terms hereof.  </FONT></P>

<p align=center>
<font size=2>25</font></p>
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<page>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.16 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Capital
Changes</U>. Until the one year anniversary of the Closing Date, the Company shall not
undertake a reverse or forward stock split or reclassification of the Common Stock
without the prior written consent of the Purchasers holding a majority in interest of the
Shares.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;4.17 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Liquidated
Damages for Failure to Comply.</U> If the Company shall fail to observe or perform any
other covenant or agreement contained in the Transaction Documents (each, an &#147;<U>Event</U>&#148; and
the date on which such Event occurs, the &#147;<U>Event Date</U>&#148;), then, in
addition to any other rights the Purchasers may have hereunder or under applicable law,
on each such Event Date and on each monthly anniversary of each such Event Date (if the
applicable Event shall not have been cured by such date) until the applicable Event is
cured, the Company shall pay to each Purchaser, in cash, as liquidated damages and not as
a penalty, an amount equal to 1.5% of the Subscription Amount of the Shares then held by
such Purchaser, subject to a maximum aggregate amount of 10% of the original Subscription
Amount of such Purchaser; <U>provided</U>, that if any other provision of any Transaction
Document separately provides for liquidated damages for any particular breach of a
covenant therein, then if the Company actually pays such liquidated damages required
under such other Transaction Document, then no further liquidated damages shall be
payable pursuant to this provision. Nothing herein shall limit a Purchaser&#146;s right
to pursue any remedies available to it hereunder, at law or in equity including, without
limitation, a decree of specific performance and/or injunctive relief. The exercise of
any such rights shall not prohibit a Purchaser from seeking to enforce damages pursuant
to any other Section hereof or under applicable law. If the Company fails to pay any
partial liquidated damages pursuant to this Section in full within seven days after the
date payable, the Company will pay interest thereon at a rate of 18% per annum (or such
lesser maximum amount that is permitted to be paid by applicable law) to the Purchaser,
accruing daily from the date such partial liquidated damages are due until such amounts,
plus all such interest thereon, are paid in full. The partial liquidated damages pursuant
to the terms hereof shall apply on a daily pro rata basis for any portion of a month
prior to the cure of an Event.  </FONT></P>

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<P ALIGN=center><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>ARTICLE V.</B> </FONT> <BR>
<FONT FACE="Times New Roman, Times, Serif" SIZE=2>MISCELLANEOUS </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.1 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Termination</U>.&nbsp; This
Agreement may be terminated by any Purchaser, as to such Purchaser&#146;s obligations
hereunder only and without any effect whatsoever on the obligations between the Company
and the other Purchasers, by written notice to the other parties, if the Closing has not
been consummated on or before May 8, 2009; <U>provided</U>, <U>however</U>, that no such
termination will affect the right of any party to sue for any breach by the other party
(or parties).  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.2 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Fees
and Expenses</U>. Except as expressly set forth in the Transaction Documents to the
contrary, each party shall pay the fees and expenses of its advisers, counsel,
accountants and other experts, if any, and all other expenses incurred by such party
incident to the negotiation, preparation, execution, delivery and performance of this
Agreement. The Company shall pay all Transfer Agent fees, stamp taxes and other taxes and
duties levied in connection with the delivery of any Securities to the Purchasers.  </FONT></P>

<p align=center>
<font size=2>26</font></p>
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<page>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.3 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Entire
Agreement</U>. The Transaction Documents, together with the exhibits and schedules
thereto, the Prospectus and the Prospectus Supplement, contain the entire understanding
of the parties with respect to the subject matter hereof and supersede all prior
agreements and understandings, oral or written, with respect to such matters, which the
parties acknowledge have been merged into such documents, exhibits and schedules.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.4 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Notices</U>.
Any and all notices or other communications or deliveries required or permitted to be
provided hereunder shall be in writing and shall be deemed given and effective on the
earliest of: (a) the date of transmission, if such notice or communication is delivered
via facsimile at the facsimile number set forth on the signature pages attached hereto
prior to 5:30 p.m. (New York City time) on a Trading Day, (b) the next Trading Day after
the date of transmission, if such notice or communication is delivered via facsimile at
the facsimile number set forth on the signature pages attached hereto on a day that is
not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (c)
the 2<SUP>nd</SUP>Trading Day following the date of mailing, if sent by U.S. nationally
recognized overnight courier service or (d) upon actual receipt by the party to whom such
notice is required to be given. The address for such notices and communications shall be
as set forth on the signature pages attached hereto.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.5 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Amendments;
Waivers</U>. No provision of this Agreement may be waived or amended except in a written
instrument signed, in the case of an amendment, by the Company and the Purchasers holding
at least 67% of the Shares then held by the Purchasers in the aggregate or, in the case
of a waiver, by the party against whom enforcement of any such waived provision is
sought. No waiver of any default with respect to any provision, condition or requirement
of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of
any subsequent default or a waiver of any other provision, condition or requirement
hereof, nor shall any delay or omission of any party to exercise any right hereunder in
any manner impair the exercise of any such right.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.6 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Headings</U>.
The headings herein are for convenience only, do not constitute a part of this Agreement
and shall not be deemed to limit or affect any of the provisions hereof.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.7 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Successors
and Assigns</U>. This Agreement shall be binding upon and inure to the benefit of the
parties and their successors and permitted assigns. The Company may not assign this
Agreement or any rights or obligations hereunder without the prior written consent of
each Purchaser (other than by merger). Any Purchaser may assign any or all of its rights
under this Agreement to any Person to whom such Purchaser assigns or transfers any
Securities, provided such transferee agrees in writing to be bound, with respect to the
transferred Securities, by the provisions of the Transaction Documents that apply to the
&#147;Purchasers.&#148; </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.8 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>No
Third-Party Beneficiaries</U>. This 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, except as otherwise
set forth in Section 4.8.  </FONT></P>

<p align=center>
<font size=2>27</font></p>
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<page>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.9 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Governing
Law</U>. All questions concerning the construction, validity, enforcement and
interpretation of the Transaction Documents shall be governed by and construed and
enforced in accordance with the internal laws of the State of New York, without regard to
the principles of conflicts of law thereof. Each party agrees that all legal proceedings
concerning the interpretations, enforcement and defense of the transactions contemplated
by this Agreement and any other Transaction Documents (whether brought against a party
hereto or its respective affiliates, directors, officers, shareholders, employees or
agents) shall be commenced exclusively in the state and federal courts sitting in the
City of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of
the state and federal courts sitting in the City of New York, borough of Manhattan for
the adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein (including with respect to the
enforcement of any of the Transaction Documents), and hereby irrevocably waives, and
agrees not to assert in any 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 is an inconvenient venue for such proceeding. Each party hereby
irrevocably waives personal service of process and consents to process being served in
any such suit, action or proceeding by mailing a copy thereof via registered or certified
mail or overnight delivery (with evidence of delivery) to such party at the address in
effect for notices to it under this Agreement and agrees that such service shall
constitute good and sufficient service of process and notice thereof. Nothing contained
herein shall be deemed to limit in any way any right to serve process in any other manner
permitted by law. If either party shall commence an action or proceeding to enforce any
provisions of the Transaction Documents, then the prevailing party in such action or
proceeding shall be reimbursed by the other party for its reasonable attorneys&#146; fees
and other costs and expenses incurred with the investigation, preparation and prosecution
of such action or proceeding.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.10 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Survival</U>.
The representations and warranties contained herein shall survive the Closing and the
delivery of the Securities for the applicable statute of limitations.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.11 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Execution</U>.
This Agreement may be executed in two or more counterparts, all of which when taken
together shall be considered one and the same agreement and shall become effective when
counterparts have been signed by each party and delivered to the other party, it being
understood that both parties need not sign the same counterpart. In the event that any
signature is delivered by facsimile transmission or by e-mail delivery of a &#147;.pdf&#148; format
data file, such signature shall create a valid and binding obligation of the party
executing (or on whose behalf such signature is executed) with the same force and effect
as if such facsimile or &#147;.pdf&#148; signature page were an original thereof.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.12 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Severability</U>.
If any term, provision, covenant or restriction of this Agreement is held by a court of
competent jurisdiction to be invalid, illegal, void or unenforceable, the remainder of
the terms, provisions, covenants and restrictions set forth herein shall remain in full
force and effect and shall in no way be affected, impaired or invalidated, and the
parties hereto shall use their commercially reasonable efforts to find and employ an
alternative means to achieve the same or substantially the same result as that
contemplated by such term, provision, covenant or restriction. It is hereby stipulated
and declared to be the intention of the parties that they would have executed the
remaining terms, provisions, covenants and restrictions without including any of such
that may be hereafter declared invalid, illegal, void or unenforceable.  </FONT></P>

<p align=center>
<font size=2>28</font></p>
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<page>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.13 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Rescission
and Withdrawal Right</U>. Notwithstanding anything to the contrary contained in (and
without limiting any similar provisions of) any of the other Transaction Documents,
whenever any Purchaser exercises a right, election, demand or option under a Transaction
Document and the Company does not timely perform its related obligations within the
periods therein provided, then such Purchaser may rescind or withdraw, in its sole
discretion from time to time upon written notice to the Company, any relevant notice,
demand or election in whole or in part without prejudice to its future actions and
rights; <U>provided</U>, <U>however</U>, that in the case of a rescission of an exercise
of a Warrant, the Purchaser shall be required to return any shares of Common Stock
subject to any such rescinded exercise notice.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.14 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Replacement
of Securities</U>. If any certificate or instrument evidencing any Securities is
mutilated, lost, stolen or destroyed, the Company shall issue or cause to be issued in
exchange and substitution for and upon cancellation thereof (in the case of mutilation),
or in lieu of and substitution therefor, a new certificate or instrument, but only upon
receipt of evidence reasonably satisfactory to the Company of such loss, theft or
destruction. The applicant for a new certificate or instrument under such circumstances
shall also pay any reasonable third-party costs (including customary indemnity)
associated with the issuance of such replacement Securities.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.15 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Remedies</U>.
In addition to being entitled to exercise all rights provided herein or granted by law,
including recovery of damages, each of the Purchasers and the Company will be entitled to
specific performance under the Transaction Documents. The parties agree that monetary
damages may not be adequate compensation for any loss incurred by reason of any breach of
obligations contained in the Transaction Documents and hereby agree to waive and not to
assert in any action for specific performance of any such obligation the defense that a
remedy at law would be adequate.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.16 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Payment
Set Aside</U>. To the extent that the Company makes a payment or payments to any
Purchaser pursuant to any Transaction Document or a Purchaser enforces or exercises its
rights thereunder, and such payment or payments or the proceeds of such enforcement or
exercise or any part thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside, recovered from, disgorged by or are required to be refunded,
repaid or otherwise restored to the Company, a trustee, receiver or any other person
under any law (including, without limitation, any bankruptcy law, state or federal law,
common law or equitable cause of action), then to the extent of any such restoration the
obligation or part thereof originally intended to be satisfied shall be revived and
continued in full force and effect as if such payment had not been made or such
enforcement or setoff had not occurred.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.17 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Independent
Nature of Purchasers&#146; Obligations and Rights</U>. The obligations of each Purchaser
under any Transaction Document are several and not joint with the obligations of any
other Purchaser, and no Purchaser shall be responsible in any way for the performance or
non-performance of the obligations of any other Purchaser under any Transaction Document.
Nothing contained herein or in any other Transaction Document, and no action taken by any
Purchaser pursuant thereto, shall be deemed to constitute the Purchasers as a
partnership, an association, a joint venture or any other kind of entity, or create a
presumption that the Purchasers are in any way acting in concert or as a group with
respect to such obligations or the transactions contemplated by the Transaction
Documents. Each Purchaser shall be entitled to independently protect and enforce its
rights including, without limitation, the rights arising out of this Agreement or out of
the other Transaction Documents, and it shall not be necessary for any other Purchaser to
be joined as an additional party in any proceeding for such purpose. Each Purchaser has
been represented by its own separate legal counsel in their review and negotiation of the
Transaction Documents. For reasons of administrative convenience only, Purchasers and
their respective counsel have chosen to communicate with the Company through FWS. FWS
does not represent all of the Purchasers but only Rodman &amp; Renshaw, LLC. The Company
has elected to provide all Purchasers with the same terms and Transaction Documents for
the convenience of the Company and not because it was required or requested to do so by
the Purchasers.  </FONT></P>

<p align=center>
<font size=2>29</font></p>
<HR SIZE="1" NOSHADE  STYLE="margin-top: -2px"><HR SIZE="4" NOSHADE  STYLE="margin-top: -10px">
<page>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.18 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Liquidated
Damages</U>. The Company&#146;s obligations to pay any partial liquidated damages or
other amounts owing under the Transaction Documents is a continuing obligation of the
Company and shall not terminate until all unpaid partial liquidated damages and other
amounts have been paid notwithstanding the fact that the instrument or security pursuant
to which such partial liquidated damages or other amounts are due and payable shall have
been canceled.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.19 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Saturdays,
Sundays, Holidays, etc.</U> If the last or appointed day for the taking of any action or
the expiration of any right required or granted herein shall not be a Business Day, then
such action may be taken or such right may be exercised on the next succeeding Business
Day.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.20 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Construction</U>.
The parties agree that each of them and/or their respective counsel has reviewed and had
an opportunity to revise the Transaction Documents and, therefore, the normal rule of
construction to the effect that any ambiguities are to be resolved against the drafting
party shall not be employed in the interpretation of the Transaction Documents or any
amendments hereto.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;5.21 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><U>WAIVER
OF JURY TRIAL</U>. <U>IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY
ANY PARTY AGAINST ANY OTHER PARTY, THE PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO THE
GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY,
IRREVOCABLY AND EXPRESSLY WAIVES FOREVER TRIAL BY JURY.</U></B> </FONT></P>




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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I>(Signature Pages
Follow) </I></FONT></P>

<p align=center>
<font size=2>30</font></p>
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<page>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN
WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be
duly executed by their respective authorized signatories as of the date first indicated
above. </FONT></P>


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<TABLE WIDTH=100% CELLSPACING=0 CELLPADDING=0 BORDER=0>
<TR VALIGN=TOP>
<TD WIDTH=50%><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>PLURISTEM THERAPEUTICS, INC. </B><BR><BR>
<BR>By:<BR>&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;&#151;<BR>
&nbsp;&nbsp;&nbsp;Name:<BR>&nbsp;&nbsp;&nbsp;Title:<BR>With a copy to (which shall not
constitute notice):</FONT></TD>
<TD WIDTH=50%> <FONT FACE="Times New Roman, Times, Serif" SIZE="2"><U>Address for Notice:</U><BR><BR>
<BR>Fax:
 </FONT></TD>
</TR>
</TABLE>
<BR>






<P align=center><FONT FACE="Times New Roman, Times, Serif" SIZE=2>[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
<BR>SIGNATURE PAGE FOR PURCHASER FOLLOWS]</FONT></P>

<p align=center>
<font size=2>31</font></p>
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<page>


<P align=center><FONT FACE="Times New Roman, Times, Serif" SIZE=2>[PURCHASER SIGNATURE PAGES TO PSTI SECURITIES PURCHASE AGREEMENT]</FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN
WITNESS WHEREOF, the undersigned have caused this Securities Purchase Agreement to be duly
executed by their respective authorized signatories as of the date first indicated above. </FONT></P>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Name of Purchaser: _______________________________________________________________________
<BR>
<BR><I>Signature of Authorized Signatory of Purchaser:</I> _________________________________________________
<BR>
<BR>Name of Authorized Signatory: ______________________________________________________________
<BR>
<BR>Title of Authorized Signatory: _______________________________________________________________
<BR>
<BR>Email Address of Authorized Signatory:________________________________________________________
<BR>
<BR>Fax Number of Authorized Signatory: __________________________________________________________
<BR>
<BR>Address for Notice of Purchaser: </FONT></P>


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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Address for Delivery of Securities
for Purchaser (if not same as address for notice): </FONT></P>


<P><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Subscription Amount: $_________________
<BR>
<BR>Shares: _________________
<BR>
<BR>Warrant Shares: __________________
<BR>
<BR>EIN Number: <B>[PROVIDE THIS UNDER SEPARATE COVER]</B> </FONT></P>



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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>[SIGNATURE PAGES
CONTINUE] </FONT></P>

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