Exhibit 10.1

SECURITIES PURCHASE AGREEMENT

This Securities Purchase Agreement (this “Agreement”) is dated as of June 28,
2007, between Cytogen Corporation, a Delaware corporation (the “Company”), and
each purchaser identified on the signature pages hereto (each, including its
successors and assigns, a “Purchaser” and collectively the “Purchasers”).

WHEREAS, subject to the terms and conditions set forth in this Agreement and
pursuant to Section 4(2) of the Securities Act of 1933, as amended (the
“Securities Act”), and Rule 506 promulgated thereunder, 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.

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:

ARTICLE I.
DEFINITIONS

1.1   DEFINITIONS.  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:

“Action” shall have the meaning ascribed to such term in Section 3.1(j).

“Affiliate” 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.  With respect to a Purchaser, any investment fund or managed
account that is managed on a discretionary basis by the same investment manager
as such Purchaser will be deemed to be an Affiliate of such Purchaser.

“Board of Directors”  means the board of directors of the Company.

“Business Day” means any day except any Saturday, any Sunday, any day which is a
federal legal holiday in the United States or any day on which banking
institutions in the State of New York are authorized or required by law or other
governmental action to close.

“Closing” means the closing of the purchase and sale of the Securities pursuant
to Section 2.1.

“Closing Date” 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’ obligations to pay the Subscription
Amount and (ii) the Company’s obligations to deliver the Securities have been
satisfied or waived.

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“Closing Price” means on any particular date (a) the last reported closing bid
price per share of Common Stock on such date on the Trading Market (as reported
by Bloomberg L.P. at 4:15 p.m. (New York City time)), or (b) if there is no such
price on such date, then the closing bid price on the Trading Market on the date
nearest preceding such date (as reported by Bloomberg L.P. at 4:15 p.m. (New
York City time)), or (c)  if the Common Stock is not then listed or quoted on a
Trading Market and if prices for the Common Stock are then reported in the “pink
sheets” 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) if the shares of Common Stock are
not then publicly traded 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 expense of which shall be paid by the
Company.

“Commission” means the Securities and Exchange Commission.

“Common Stock” means the common stock of the Company, par value $0.01 per share,
and any other class of securities into which such securities may hereafter be
reclassified or changed into.

“Common Stock Equivalents” 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.

“Company Counsel” means Morgan, Lewis & Bockius LLP, with offices located at
502 Carnegie Center, Princeton, New Jersey 08540.

“Disclosure Schedules” means the Disclosure Schedules of the Company delivered
concurrently herewith.

“Effective Date” means the date that the Registration Statement filed by the
Company pursuant to the Registration Rights Agreement is first declared
effective by the Commission.

“Evaluation Date” shall have the meaning ascribed to such term in
Section 3.1(r).

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.

“Exempt Issuance” means the issuance of (a) shares of Common Stock or options to
employees, officers or directors of the Company pursuant to any stock or option
plan duly adopted, 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 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,

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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, (c) securities issued pursuant
to acquisitions, strategic transactions, equipment financings or non-convertible
debt financings approved by a majority of the disinterested directors of the
Company, provided that any such issuance 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, and
(d) a firm commitment underwritten public offering of Common Stock of the
Company.

“FWS” means Feldman Weinstein & Smith LLP with offices located at 420 Lexington
Avenue, Suite 2620, New York, New York 10170-0002.

“GAAP” shall have the meaning ascribed to such term in Section 3.1(h).

“Indebtedness” shall have the meaning ascribed to such term in Section 3.1(z).

“Intellectual Property Rights” shall have the meaning ascribed to such term in
Section 3.1(o).

“Legend Removal Date” shall have the meaning ascribed to such term in
Section 4.1(c).

“Liens” means a lien, charge, security interest, encumbrance, right of first
refusal, preemptive right or other restriction.

“Material Adverse Effect” shall have the meaning assigned to such term in
3.1(a).

“Material Permits” shall have the meaning ascribed to such term in
Section 3.1(m).

“Per Share Purchase Price” equals $1.737, 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.

“Person” 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.

“Proceeding” 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.

“Purchaser Party” shall have the meaning ascribed to such term in Section 4.8.

“Registration Rights Agreement” means the Registration Rights Agreement, dated
the date hereof, among the Company and the Purchasers, in the form of Exhibit A
attached hereto.

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“Registration Statement” means a registration statement meeting the requirements
set forth in the Registration Rights Agreement and covering the resale by the
Purchasers of the Shares and the Warrant Shares.

“Required Approvals” shall have the meaning ascribed to such term in
Section 3.1(e).

“Rule 144” 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.

“SEC Reports” shall have the meaning ascribed to such term in Section 3.1(h).

“Securities” means the Shares, the Warrants and the Warrant Shares.

“Securities Act” means the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.

“Shares” means the shares of Common Stock issued or issuable to each Purchaser
pursuant to this Agreement.

“Short Sales” means all “short sales” 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).

“Subscription Amount” means, as to each Purchaser, the aggregate amount to be
paid for Shares and Warrants purchased hereunder as specified below such
Purchaser’s name on the signature page of this Agreement and next to the heading
“Subscription Amount,” in United States dollars and in immediately available
funds.

“Subsidiary” means any subsidiary of the Company as set forth on
Schedule 3.1(a), and shall, where applicable, include any subsidiary of the
Company formed or acquired after the date hereof.

“Trading Day” means a day on which the New York Stock Exchange is open for
trading.

“Trading Market” 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

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Exchange, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global
Select Market, the New York Stock Exchange or the OTC Bulletin Board.

“Transaction Documents” means this Agreement, the Warrants, the Registration
Rights Agreement and any other documents or agreements executed in connection
with the transactions contemplated hereunder.

“Transfer Agent” means American Stock Transfer & Trust Company, the current
transfer agent of the Company, with a mailing address of 6201 15th Avenue,
Brooklyn, New York 11219 and a facsimile number of (718) 921-8327, and any
successor transfer agent of the Company.

“VWAP” 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)  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
quoted for trading on the OTC Bulletin Board and if prices for the Common Stock
are then reported in the “Pink Sheets” 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) 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.

“Warrants” 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 only after six (6) months after the date of
issuance and have a term of exercise equal to five (5) years, in the form of
Exhibit C attached hereto.

“Warrant Shares” means the shares of Common Stock issuable upon exercise of the
Warrants.

ARTICLE II.
PURCHASE AND SALE

2.1   CLOSING.  ON THE CLOSING DATE, UPON THE TERMS AND SUBJECT TO THE
CONDITIONS SET FORTH HEREIN, CONCURRENT WITH THE EXECUTION AND DELIVERY OF THIS
AGREEMENT BY THE PARTIES HERETO, THE COMPANY AGREES TO SELL, AND EACH PURCHASER
AGREES TO PURCHASE IN THE AGGREGATE, SEVERALLY AND NOT JOINTLY, UP TO AN
AGGREGATE OF 5,814,600 SHARES PLUS WARRANTS TO PURCHASE UP TO 2,907,301 WARRANT
SHARES.  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 THEIR RESPECTIVE SHARES AND A
WARRANT AS DETERMINED PURSUANT TO

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SECTION 2.2(A)(IV), 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.

2.2   DELIVERIES.

(A)   ON OR PRIOR TO THE CLOSING DATE, THE COMPANY SHALL DELIVER OR CAUSE TO BE
DELIVERED TO EACH PURCHASER THE FOLLOWING:

(I)            THIS AGREEMENT DULY EXECUTED BY THE COMPANY;

(II)           A LEGAL OPINION OF COMPANY COUNSEL, SUBSTANTIALLY IN THE FORM OF
EXHIBIT B ATTACHED HERETO;

(III)          A COPY OF THE IRREVOCABLE INSTRUCTIONS TO THE TRANSFER AGENT
INSTRUCTING THE TRANSFER AGENT TO DELIVER, ON AN EXPEDITED BASIS, A CERTIFICATE
EVIDENCING A NUMBER OF SHARES EQUAL TO SUCH PURCHASER’S SUBSCRIPTION AMOUNT
DIVIDED BY THE PER SHARE PURCHASE PRICE, REGISTERED IN THE NAME OF SUCH
PURCHASER, AND A COPY OF SUCH PURCHASER’S STOCK CERTIFICATE FROM THE TRANSFER
AGENT;

(IV)          A WARRANT REGISTERED IN THE NAME OF SUCH PURCHASER TO PURCHASE UP
TO A NUMBER OF SHARES OF COMMON STOCK EQUAL TO 50% OF SUCH PURCHASER’S
SUBSCRIPTION AMOUNT DIVIDED BY THE PER SHARE PURCHASE PRICE, WITH AN EXERCISE
PRICE EQUAL TO $2.231, SUBJECT TO ADJUSTMENT THEREIN; AND

(V)           THE REGISTRATION RIGHTS AGREEMENT DULY EXECUTED BY THE COMPANY.

(B)   ON OR PRIOR TO THE CLOSING DATE, EACH PURCHASER SHALL DELIVER OR CAUSE TO
BE DELIVERED TO THE COMPANY THE FOLLOWING:

(I)            THIS AGREEMENT DULY EXECUTED BY SUCH PURCHASER;

(II)           SUCH PURCHASER’S SUBSCRIPTION AMOUNT BY WIRE TRANSFER TO THE
ACCOUNT AS SPECIFIED IN WRITING BY THE COMPANY; AND

(III)          THE REGISTRATION RIGHTS AGREEMENT DULY EXECUTED BY SUCH
PURCHASER.

2.3   CLOSING CONDITIONS.

(A)           THE OBLIGATIONS OF THE COMPANY HEREUNDER IN CONNECTION WITH THE
CLOSING ARE SUBJECT TO THE FOLLOWING CONDITIONS BEING MET:

(I)            THE ACCURACY IN ALL MATERIAL RESPECTS ON THE CLOSING DATE OF THE
REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS CONTAINED HEREIN;

(II)           ALL OBLIGATIONS, COVENANTS AND AGREEMENTS OF EACH PURCHASER
REQUIRED TO BE PERFORMED AT OR PRIOR TO THE CLOSING DATE SHALL HAVE BEEN
PERFORMED IN ALL MATERIAL RESPECTS; AND

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(III)          THE DELIVERY BY EACH PURCHASER OF THE ITEMS SET FORTH IN
SECTION 2.2(B) OF THIS AGREEMENT.

(B)   THE RESPECTIVE OBLIGATIONS OF THE PURCHASERS HEREUNDER IN CONNECTION WITH
THE CLOSING ARE SUBJECT TO THE FOLLOWING CONDITIONS BEING MET:

(I)            THE ACCURACY IN ALL MATERIAL RESPECTS ON THE CLOSING DATE OF THE
REPRESENTATIONS AND WARRANTIES OF THE COMPANY CONTAINED HEREIN;

(II)           ALL OBLIGATIONS, COVENANTS AND AGREEMENTS OF THE COMPANY REQUIRED
TO BE PERFORMED AT OR PRIOR TO THE CLOSING DATE SHALL HAVE BEEN PERFORMED IN ALL
MATERIAL RESPECTS;

(III)          THE DELIVERY BY THE COMPANY OF THE ITEMS SET FORTH IN
SECTION 2.2(A) OF THIS AGREEMENT;

(IV)          THERE SHALL HAVE BEEN NO MATERIAL ADVERSE EFFECT WITH RESPECT TO
THE COMPANY SINCE THE DATE HEREOF; AND

(V)           FROM THE DATE HEREOF TO THE CLOSING DATE, TRADING IN THE COMMON
STOCK SHALL NOT HAVE BEEN SUSPENDED BY THE COMMISSION OR THE COMPANY’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.

ARTICLE III.
REPRESENTATIONS AND WARRANTIES

3.1   REPRESENTATIONS AND WARRANTIES OF THE COMPANY.  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:

(A)   SUBSIDIARIES.  ALL OF THE DIRECT AND INDIRECT SUBSIDIARIES OF THE COMPANY
ARE SET FORTH ON EXHIBIT 3.1(A) OF THE COMPANY’S DISCLOSURE SCHEDULES.  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

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PREEMPTIVE AND SIMILAR RIGHTS TO SUBSCRIBE FOR OR PURCHASE SECURITIES.  IF THE
COMPANY HAS NO SUBSIDIARIES, THEN REFERENCES TO THE SUBSIDIARIES IN THE
TRANSACTION DOCUMENTS SHALL BE DISREGARDED.

(B)   ORGANIZATION AND QUALIFICATION.  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.  EXCEPT WITH
RESPECT TO THE COMPANY IN THE STATE OF NEW JERSEY, 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 OR FINANCIAL CONDITION OF THE COMPANY AND THE
SUBSIDIARIES, TAKEN AS A WHOLE, OR (III) A MATERIAL ADVERSE EFFECT ON THE
COMPANY’S ABILITY TO PERFORM IN ANY MATERIAL RESPECT ON A TIMELY BASIS ITS
OBLIGATIONS UNDER ANY TRANSACTION DOCUMENT (ANY OF (I), (II) OR (III), A
“MATERIAL ADVERSE EFFECT”) AND NO PROCEEDING HAS BEEN INSTITUTED IN ANY SUCH
JURISDICTION REVOKING, LIMITING OR CURTAILING OR SEEKING TO REVOKE, LIMIT OR
CURTAIL SUCH POWER AND AUTHORITY OR QUALIFICATION.

(C)   AUTHORIZATION; ENFORCEMENT.  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’S STOCKHOLDERS IN CONNECTION
THEREWITH OTHER THAN IN CONNECTION WITH THE REQUIRED APPROVALS.  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,
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’ 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.

(D)   NO CONFLICTS.  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’S OR

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ANY SUBSIDIARY’S CERTIFICATE OR ARTICLES OF INCORPORATION, BYLAWS OR OTHER
ORGANIZATIONAL OR CHARTER DOCUMENTS, OR (II) CONFLICT WITH, OR CONSTITUTE A
MATERIAL 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.

(E)   FILINGS, CONSENTS AND APPROVALS.  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) FILINGS REQUIRED PURSUANT TO SECTION 4.4 OF THIS AGREEMENT, (II) THE FILING
WITH THE COMMISSION OF THE REGISTRATION STATEMENT, (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) THE FILING OF FORM D WITH THE
COMMISSION AND SUCH FILINGS AS ARE REQUIRED TO BE MADE UNDER APPLICABLE STATE
SECURITIES LAWS (COLLECTIVELY, THE “REQUIRED APPROVALS”).

(F)    ISSUANCE OF THE SECURITIES.  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 WARRANT SHARES, WHEN ISSUED IN ACCORDANCE
WITH THE TERMS OF THE TRANSACTION DOCUMENTS, WILL BE 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 THIS AGREEMENT AND THE WARRANTS.

(G)   CAPITALIZATION.  EXCEPT AS OTHER WISE DISCLOSED ON SCHEDULE 3.1(G) OF THE
DISCLOSURE SCHEDULES, THE CAPITALIZATION OF THE COMPANY IS AS SET FORTH IN THE
COMPANY’S SEC REPORTS. 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’S STOCK OPTION PLAN,
THE ISSUANCE OF SHARES OF COMMON STOCK TO EMPLOYEES PURSUANT TO THE COMPANY’S
EMPLOYEE STOCK PURCHASE PLANS AND PURSUANT TO THE CONVERSION OR EXERCISE OF
COMMON STOCK EQUIVALENTS.  NO PERSON HAS ANY

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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 AND
EXCEPT AS SET FORTH IN THE SEC REPORTS, 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’S CAPITAL STOCK TO WHICH THE COMPANY IS A PARTY OR, TO THE KNOWLEDGE OF
THE COMPANY, BETWEEN OR AMONG ANY OF THE COMPANY’S STOCKHOLDERS.

(H)   SEC REPORTS; FINANCIAL STATEMENTS.  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 (2) 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, BEING COLLECTIVELY REFERRED TO
HEREIN AS THE “SEC REPORTS”) 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 (“GAAP”), 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

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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.

(I)    MATERIAL CHANGES; UNDISCLOSED EVENTS, LIABILITIES OR DEVELOPMENTS.  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) TRADE PAYABLES
AND ACCRUED EXPENSES INCURRED IN THE ORDINARY COURSE OF BUSINESS CONSISTENT WITH
PAST PRACTICE AND (B) LIABILITIES NOT REQUIRED TO BE REFLECTED IN THE COMPANY’S
FINANCIAL STATEMENTS PURSUANT TO GAAP OR REQUIRED TO BE DISCLOSED IN FILINGS
MADE WITH THE COMMISSION, (III) THE COMPANY HAS NOT ALTERED ITS METHOD OF
ACCOUNTING, (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. 
EXCEPT FOR THE ISSUANCE OF THE SECURITIES CONTEMPLATED BY THIS AGREEMENT OR AS
SET FORTH ON SCHEDULE 3.1(I) OF THE DISCLOSURE SCHEDULES, 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 ONE (1) TRADING DAY PRIOR TO THE DATE THAT THIS
REPRESENTATION IS MADE.

(J)    LITIGATION.  EXCEPT AS DISCLOSED IN THE SEC REPORTS, 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 “ACTION”) 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 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.

(K)   LABOR RELATIONS.  NO MATERIAL LABOR DISPUTE EXISTS OR, TO THE KNOWLEDGE OF
THE COMPANY, IS IMMINENT WITH RESPECT TO ANY OF THE EMPLOYEES OF THE COMPANY
WHICH COULD REASONABLY BE EXPECTED TO RESULT IN A MATERIAL ADVERSE EFFECT.  NONE
OF THE COMPANY’S OR ITS SUBSIDIARIES’ EMPLOYEES IS A MEMBER OF A UNION THAT
RELATES TO SUCH EMPLOYEE’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

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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.

(L)    COMPLIANCE.  NEITHER THE COMPANY NOR ANY SUBSIDIARY (I) IS IN MATERIAL
DEFAULT UNDER OR IN MATERIAL 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.

(M)  REGULATORY PERMITS.  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  HAVE OR REASONABLY BE EXPECTED TO RESULT IN A
MATERIAL ADVERSE EFFECT (“MATERIAL PERMITS”), AND NEITHER THE COMPANY NOR ANY
SUBSIDIARY HAS RECEIVED ANY NOTICE OF PROCEEDINGS RELATING TO THE REVOCATION OR
MODIFICATION OF ANY MATERIAL PERMIT.

(N)   TITLE TO ASSETS.  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 WITH WHICH THE COMPANY AND THE SUBSIDIARIES ARE IN
COMPLIANCE.

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(O)   PATENTS AND TRADEMARKS.  THE COMPANY AND THE SUBSIDIARIES HAVE, OR HAVE
RIGHTS TO USE, ALL ISSUED PATENTS, 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 AS DESCRIBED IN THE SEC REPORTS AND WHICH THE
FAILURE TO SO HAVE COULD HAVE A MATERIAL ADVERSE EFFECT (COLLECTIVELY, THE
“INTELLECTUAL PROPERTY RIGHTS”).  NEITHER THE COMPANY NOR ANY SUBSIDIARY HAS
RECEIVED A 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, NONE OF WHICH INDIVIDUALLY OR IN THE AGGREGATE WOULD BE
LIKELY TO CAUSE A MATERIAL ADVERSE EFFECT..  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.

(P)   INSURANCE.  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.

(Q)   TRANSACTIONS WITH AFFILIATES AND EMPLOYEES.  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 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.

(R)    SARBANES-OXLEY; INTERNAL ACCOUNTING CONTROLS.  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’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,

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(III) ACCESS TO ASSETS IS PERMITTED ONLY IN ACCORDANCE WITH MANAGEMENT’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 MATERIAL INFORMATION REQUIRED TO BE DISCLOSED BY THE COMPANY IN
THE REPORTS IT FILES OR SUBMITS UNDER THE EXCHANGE ACT IS ACCUMULATED, RECORDED,
PROCESSED, SUMMARIZED AND REPORTED, WITHIN THE TIME PERIODS SPECIFIED IN THE
COMMISSION’S RULES AND FORMS.  THE COMPANY’S CERTIFYING OFFICERS HAVE EVALUATED
THE EFFECTIVENESS OF THE COMPANY’S DISCLOSURE CONTROLS AND PROCEDURES AS OF THE
END OF THE FISCAL QUARTER COVERED BY THE COMPANY’S MOST RECENTLY FILED PERIODIC
REPORT UNDER THE EXCHANGE ACT (SUCH DATE, THE “EVALUATION DATE”).  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 MATERIAL CHANGES IN THE COMPANY’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’S INTERNAL CONTROL OVER FINANCIAL REPORTING.

(S)   CERTAIN FEES.  EXCEPT AS OTHERWISE DISCLOSED ON SCHEDULE 3.1(S) OF THE
DISCLOSURE SCHEDULES AND FOR RODMAN & RENSHAW, LLC AND ROTH CAPITAL PARTNERS,
LLC, NO BROKERAGE OR FINDER’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.

(T)    PRIVATE PLACEMENT. ASSUMING THE ACCURACY OF THE PURCHASERS’
REPRESENTATIONS AND WARRANTIES SET FORTH IN SECTION 3.2, NO REGISTRATION UNDER
THE SECURITIES ACT IS REQUIRED FOR THE OFFER AND SALE OF THE SECURITIES BY THE
COMPANY TO THE PURCHASERS AS CONTEMPLATED HEREBY. THE ISSUANCE AND SALE OF THE
SECURITIES HEREUNDER DOES NOT CONTRAVENE THE RULES AND REGULATIONS OF THE
TRADING MARKET.

(U)   INVESTMENT COMPANY. 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 “INVESTMENT COMPANY” 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.

(V)   REGISTRATION RIGHTS.  EXCEPT AS SET FORTH ON SCHEDULE 3.1(V) OF THE
DISCLOSURE SCHEDULES AND EXCEPT FOR EACH OF THE PURCHASERS, NO PERSON HAS ANY
RIGHT TO CAUSE THE COMPANY TO EFFECT THE REGISTRATION UNDER THE SECURITIES ACT
OF ANY SECURITIES OF THE COMPANY.

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(W)  LISTING AND MAINTENANCE REQUIREMENTS.  THE COMPANY’S COMMON STOCK IS
REGISTERED PURSUANT TO SECTION 12(B) OF THE EXCHANGE ACT, AND THE COMPANY HAS
TAKEN NO ACTION DESIGNED TO, OR WHICH IS LIKELY TO HAVE THE EFFECT OF AND IS NOT
AWARE OF ANY FACTS OR CIRCUMSTANCES THAT COULD RESULT IN, TERMINATING THE
REGISTRATION OF THE COMMON STOCK UNDER THE EXCHANGE ACT OR DELISTING THE COMMON
STOCK FROM A TRADING MARKET NOR HAS THE COMPANY RECEIVED ANY NOTIFICATION THAT
THE COMMISSION IS CONTEMPLATING TERMINATING SUCH REGISTRATION.  THE COMPANY HAS
NOT, IN THE TWELVE (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
IN ALL MATERIAL RESPECTS WITH ALL SUCH LISTING AND MAINTENANCE REQUIREMENTS.

(X)            APPLICATION OF TAKEOVER PROTECTIONS.  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’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’S
ISSUANCE OF THE SECURITIES AND THE PURCHASERS’ OWNERSHIP OF THE SECURITIES.

(Y)   DISCLOSURE.  EXCEPT WITH RESPECT TO 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 CONSTITUTES
OR MIGHT CONSTITUTE MATERIAL, NON-PUBLIC INFORMATION.   THE COMPANY UNDERSTANDS
AND CONFIRMS THAT THE PURCHASERS WILL RELY ON THE FOREGOING REPRESENTATIONS,
WARRANTIES AND COVENANTS 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, IS TRUE AND CORRECT IN ALL MATERIAL
RESPECTS WITH RESPECT TO SUCH REPRESENTATIONS AND WARRANTIES 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.

(Z)    NO INTEGRATED OFFERING. ASSUMING THE ACCURACY OF THE PURCHASERS’
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

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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 THE SECURITIES
ACT WHICH WOULD CAUSE THIS OFFERING NOT TO BE EXEMPT FROM (I) REQUIREMENTS OF
SECTION 5 OF THE SECURITIES ACT, THE REGISTRATION OF ANY SUCH SECURITIES UNDER
THE SECURITIES ACT AND (II) TO THE KNOWLEDGE OF THE COMPANY, ANY APPLICABLE
SHAREHOLDER APPROVAL PROVISIONS OF ANY TRADING MARKET ON WHICH THE COMMON STOCK
IS LISTED OR DESIGNATED.

(AA)        SOLVENCY.  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, (I) THE FAIR SALEABLE VALUE OF THE
COMPANY’S ASSETS EXCEEDS THE AMOUNT THAT WILL BE REQUIRED TO BE PAID ON OR IN
RESPECT OF THE COMPANY’S EXISTING DEBTS AND OTHER LIABILITIES (INCLUDING KNOWN
CONTINGENT LIABILITIES) AS THEY MATURE, (II) THE COMPANY’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 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 (1) YEAR FROM THE CLOSING
DATE.  THE SEC REPORTS SET 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,
“INDEBTEDNESS” MEANS (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’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.

(BB)       TAX STATUS.  EXCEPT FOR MATTERS THAT WOULD NOT, INDIVIDUALLY OR IN
THE AGGREGATE, HAVE OR REASONABLY BE EXPECTED TO RESULT IN A MATERIAL ADVERSE
EFFECT, THE COMPANY AND EACH SUBSIDIARY HAS FILED ALL NECESSARY FEDERAL, STATE
AND FOREIGN INCOME AND FRANCHISE TAX RETURNS AND HAS PAID OR ACCRUED ALL TAXES
SHOWN AS DUE THEREON, AND THE COMPANY HAS NO KNOWLEDGE OF A TAX DEFICIENCY WHICH
HAS BEEN ASSERTED OR THREATENED AGAINST THE COMPANY OR ANY SUBSIDIARY.

(CC)        NO GENERAL SOLICITATION.  NEITHER THE COMPANY NOR TO ITS KNOWLEDGE
ANY PERSON ACTING ON BEHALF OF THE COMPANY HAS OFFERED OR SOLD ANY OF THE
SECURITIES BY ANY

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FORM OF GENERAL SOLICITATION OR GENERAL ADVERTISING.  TO THE KNOWLEDGE OF THE
COMPANY, NO PERSON ACTING ON BEHALF OF THE COMPANY HAS OFFERED THE SECURITIES
FOR SALE OTHER THAN TO THE PURCHASERS AND CERTAIN OTHER “ACCREDITED INVESTORS”
WITHIN THE MEANING OF RULE 501 UNDER THE SECURITIES ACT.

(DD)       FOREIGN CORRUPT PRACTICES.  NEITHER THE COMPANY, NOR TO THE KNOWLEDGE
OF THE COMPANY, ANY AGENT OR OTHER PERSON ACTING ON BEHALF OF THE COMPANY, HAS
(I) DIRECTLY OR INDIRECTLY, USED ANY 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.

(EE)        ACCOUNTANTS.  THE COMPANY’S CURRENT ACCOUNTING FIRM IS SET FORTH IN
THE SEC REPORTS.  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’S ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDING
DECEMBER 31, 2007.

(FF)         NO DISAGREEMENTS WITH ACCOUNTANTS AND LAWYERS.  THERE ARE NO
DISAGREEMENTS OF ANY KIND PRESENTLY EXISTING, OR REASONABLY ANTICIPATED BY THE
COMPANY TO ARISE, BETWEEN THE COMPANY AND THE ACCOUNTANTS AND LAWYERS PRESENTLY
EMPLOYED BY THE COMPANY WHICH COULD REASONABLY AFFECT THE COMPANY’S ABILITY TO
PERFORM ANY OF ITS OBLIGATIONS UNDER ANY OF THE TRANSACTION DOCUMENTS, AND THE
COMPANY IS CURRENT WITH RESPECT TO ANY FEES OWED TO ITS ACCOUNTANTS AND LAWYERS.

(GG)       ACKNOWLEDGMENT REGARDING PURCHASERS’ PURCHASE OF SECURITIES.  THE
COMPANY ACKNOWLEDGES AND AGREES THAT EACH OF THE PURCHASERS IS ACTING SOLELY IN
THE CAPACITY OF AN ARM’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’ PURCHASE OF THE SECURITIES.  THE COMPANY
FURTHER REPRESENTS TO EACH PURCHASER THAT THE COMPANY’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.

(HH)       ACKNOWLEDGEMENT REGARDING PURCHASER’S TRADING ACTIVITY.  ANYTHING IN
THIS AGREEMENT OR ELSEWHERE HEREIN TO THE CONTRARY NOTWITHSTANDING (EXCEPT FOR
SECTIONS 3.2(F) AND 4.12 HEREOF), IT IS UNDERSTOOD AND ACKNOWLEDGED BY THE
COMPANY (I) THAT 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

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COMPANY, OR “DERIVATIVE” 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 “DERIVATIVE” TRANSACTIONS, BEFORE OR AFTER THE
CLOSING OF THIS OR FUTURE PRIVATE PLACEMENT TRANSACTIONS, MAY NEGATIVELY IMPACT
THE MARKET PRICE OF THE COMPANY’S PUBLICLY-TRADED SECURITIES; (III) THAT ANY
PURCHASER, AND COUNTER-PARTIES IN “DERIVATIVE” TRANSACTIONS TO WHICH ANY SUCH
PURCHASER IS A PARTY, DIRECTLY OR INDIRECTLY, PRESENTLY MAY HAVE A “SHORT”
POSITION IN THE COMMON STOCK, AND (IV) THAT EACH PURCHASER SHALL NOT BE DEEMED
TO HAVE ANY AFFILIATION WITH OR CONTROL OVER ANY ARM’S LENGTH COUNTER-PARTY IN
ANY “DERIVATIVE” TRANSACTION.  THE COMPANY FURTHER UNDERSTANDS AND ACKNOWLEDGES
THAT (A) ONE OR MORE PURCHASERS MAY ENGAGE IN HEDGING ACTIVITIES AT VARIOUS
TIMES DURING THE PERIOD THAT THE SECURITIES ARE OUTSTANDING AND (B) SUCH HEDGING
ACTIVITIES (IF ANY) COULD REDUCE THE VALUE OF THE EXISTING STOCKHOLDERS’ EQUITY
INTERESTS IN THE COMPANY AT AND AFTER THE TIME THAT THE HEDGING ACTIVITIES ARE
BEING CONDUCTED.  THE COMPANY ACKNOWLEDGES THAT SUCH AFOREMENTIONED HEDGING
ACTIVITIES DO NOT CONSTITUTE A BREACH OF ANY OF THE TRANSACTION DOCUMENTS.

(II)          REGULATION M COMPLIANCE.  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
AGENTS’ 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, OTHER THAN, IN THE CASE OF CLAUSES (II) AND (III), COMPENSATION
PAID TO THE COMPANY’S PLACEMENT AGENT IN CONNECTION WITH THE PLACEMENT OF THE
SECURITIES.

(JJ)          FDA.  AS TO EACH PRODUCT SUBJECT TO THE JURISDICTION OF THE U.S.
FOOD AND DRUG ADMINISTRATION (“FDA”) UNDER THE FEDERAL FOOD, DRUG AND COSMETIC
ACT, AS AMENDED, AND THE REGULATIONS THEREUNDER (“FDCA”) THAT IS MANUFACTURED,
PACKAGED, LABELED, TESTED, DISTRIBUTED, SOLD, AND/OR MARKETED BY THE COMPANY OR
ANY OF ITS SUBSIDIARIES (EACH SUCH PRODUCT, A “PHARMACEUTICAL PRODUCT”), SUCH
PHARMACEUTICAL PRODUCT IS, TO THE KNOWLEDGE OF THE COMPANY, BEING MANUFACTURED,
PACKAGED, LABELED, TESTED, DISTRIBUTED, SOLD AND/OR MARKETED BY THE COMPANY IN
COMPLIANCE IN ALL MATERIAL RESPECTS 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’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 : (A)
(I) CONTESTS THE PREMARKET CLEARANCE, LICENSURE, REGISTRATION, OR APPROVAL OF,
THE USES OF, THE DISTRIBUTION OF, THE MANUFACTURING OR PACKAGING OF, THE TESTING

18

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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 (B), EITHER INDIVIDUALLY OR IN THE AGGREGATE, WOULD
HAVE A MATERIAL ADVERSE EFFECT.  THE PROPERTIES, BUSINESS AND OPERATIONS OF THE
COMPANY HAVE BEEN AND ARE BEING CONDUCTED IN ALL MATERIAL RESPECTS IN ACCORDANCE
WITH ALL APPLICABLE LAWS, RULES AND REGULATIONS OF THE FDA.  THE COMPANY HAS NOT
BEEN INFORMED BY THE FDA THAT THE FDA WILL PROHIBIT THE MARKETING, SALE, LICENSE
OR USE IN THE UNITED STATES OF ANY PRODUCT PRODUCED OR MARKETED BY THE COMPANY
NOR, EXCEPT AS SET FORTH IN THE SEC REPORTS, HAS THE FDA EXPRESSED ANY CONCERN
IN WRITING AS TO APPROVING OR CLEARING FOR MARKETING ANY PRODUCT BEING DEVELOPED
BY THE COMPANY.

(KK)         FORM S-3 ELIGIBILITY.  THE COMPANY IS ELIGIBLE TO REGISTER THE
RESALE OF THE SECURITIES FOR RESALE BY THE PURCHASER ON FORM S-3 PROMULGATED
UNDER THE SECURITIES ACT.

3.2   REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS.  EACH PURCHASER HEREBY,
FOR ITSELF AND FOR NO OTHER PURCHASER, REPRESENTS AND WARRANTS AS OF THE DATE
HEREOF AND AS OF THE CLOSING DATE TO THE COMPANY AS FOLLOWS:

(A)   ORGANIZATION; AUTHORITY.  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 THE TRANSACTION
DOCUMENTS AND OTHERWISE TO CARRY OUT ITS OBLIGATIONS HEREUNDER AND THEREUNDER.
THE EXECUTION AND DELIVERY OF THE TRANSACTION DOCUMENTS AND PERFORMANCE BY SUCH
PURCHASER OF THE TRANSACTIONS CONTEMPLATED BY THE TRANSACTION DOCUMENTS 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’ 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.

(B)   OWN ACCOUNT.  SUCH PURCHASER UNDERSTANDS THAT THE SECURITIES ARE
“RESTRICTED SECURITIES” AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OR
ANY APPLICABLE STATE SECURITIES LAW AND 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

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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’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.

(C)   PURCHASER STATUS.  AT THE TIME SUCH PURCHASER WAS OFFERED THE SECURITIES,
IT WAS, AND AT THE DATE HEREOF IT IS, AND ON EACH DATE ON WHICH IT EXERCISES ANY
WARRANTS, IT WILL BE EITHER: (I) AN “ACCREDITED INVESTOR” AS DEFINED IN
RULE 501(A)(1), (A)(2), (A)(3), (A)(7) OR (A)(8) UNDER THE SECURITIES ACT OR
(II) A “QUALIFIED INSTITUTIONAL BUYER” 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 AND ALL OF THE SEC REPORTS
HAVE BEEN MADE AVAILABLE TO THE PURCHASER.

(D)   EXPERIENCE OF SUCH PURCHASER.  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.

(E)   GENERAL SOLICITATION.  SUCH PURCHASER IS NOT PURCHASING THE SECURITIES AS
A RESULT OF ANY ADVERTISEMENT, ARTICLE, NOTICE OR OTHER COMMUNICATION REGARDING
THE SECURITIES PUBLISHED IN ANY NEWSPAPER, MAGAZINE OR SIMILAR MEDIA OR
BROADCAST OVER TELEVISION OR RADIO OR PRESENTED AT ANY SEMINAR ATTENDED BY SUCH
PURCHASER.

(F)    SHORT SALES AND CONFIDENTIALITY PRIOR TO THE DATE HEREOF.  OTHER THAN 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 DISPOSITIONS, INCLUDING SHORT
SALES, 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 UNTIL THE DATE HEREOF
(“DISCUSSION TIME”) (AND WITH RESPECT TO PURCHASERS THAT ARE ENTITIES AFFILIATED
WITH ARNHOLD AND S. BLEICHROEDER ADVISERS, LLC AND ACCOUNTS THAT IT MANAGES,
SUCH REPRESENTATION IS MADE ONLY SINCE THE TIME THAT SUCH PURCHASER FIRST BECAME
AWARE THAT THE OFFERING WAS CONTEMPLATED).  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’S ASSETS
OR A PURCHASER WITH MULTIPLE PORTFOLIO MANAGER WHO MANAGE ASSETS FOR MULTIPLE
ACCOUNTS, AND THE PORTFOLIO MANAGERS HAVE NO DIRECT KNOWLEDGE OF THE INVESTMENT
DECISIONS MADE BY THE PORTFOLIO MANAGERS MANAGING OTHER PORTIONS OF SUCH
PURCHASER’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

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MAINTAINED THE CONFIDENTIALITY OF ALL DISCLOSURES MADE TO IT IN CONNECTION WITH
THIS TRANSACTION (INCLUDING THE EXISTENCE AND TERMS OF THIS TRANSACTION).

ARTICLE IV.
OTHER AGREEMENTS OF THE PARTIES

4.1   TRANSFER RESTRICTIONS.

(A)           THE SECURITIES MAY ONLY BE DISPOSED OF IN COMPLIANCE WITH STATE
AND FEDERAL SECURITIES LAWS.  IN CONNECTION WITH ANY TRANSFER OF SECURITIES
OTHER THAN PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT OR RULE 144
PROMULGATED UNDER THE SECURITIES ACT, TO THE COMPANY OR TO AN AFFILIATE OF A
PURCHASER OR IN CONNECTION WITH A PLEDGE AS CONTEMPLATED IN SECTION 4.1(B), THE
COMPANY MAY REQUIRE THE TRANSFEROR THEREOF TO PROVIDE TO THE COMPANY AN OPINION
OF COUNSEL SELECTED BY THE TRANSFEROR AND REASONABLY ACCEPTABLE TO THE COMPANY,
THE FORM AND SUBSTANCE OF WHICH OPINION SHALL BE REASONABLY SATISFACTORY TO THE
COMPANY, TO THE EFFECT THAT SUCH TRANSFER DOES NOT REQUIRE REGISTRATION OF SUCH
TRANSFERRED SECURITIES UNDER THE SECURITIES ACT.  AS A CONDITION OF TRANSFER,
ANY SUCH TRANSFEREE SHALL AGREE IN WRITING TO BE BOUND BY THE TERMS OF THIS
AGREEMENT AND SHALL HAVE THE RIGHTS OF A PURCHASER UNDER THIS AGREEMENT AND THE
REGISTRATION RIGHTS AGREEMENT.

(B)   THE PURCHASERS AGREE TO THE IMPRINTING, SO LONG AS IS REQUIRED BY THIS
SECTION 4.1, OF A LEGEND ON ANY OF THE SECURITIES IN THE FOLLOWING FORM:

THIS SECURITY HAS NOT BEEN  REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO
AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH
APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO
THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY
ACCEPTABLE TO THE COMPANY, IF REQUESTED BY THE COMPANY.  THIS SECURITY MAY BE
PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT WITH A REGISTERED
BROKER-DEALER OR OTHER LOAN WITH A FINANCIAL INSTITUTION THAT IS AN “ACCREDITED
INVESTOR” AS DEFINED IN RULE 501(a) UNDER THE SECURITIES ACT OR OTHER LOAN
SECURED BY SUCH SECURITIES.

The Company acknowledges and agrees that a Purchaser may from time to time
pledge pursuant to a bona fide margin agreement with a registered broker-dealer
or grant a security interest in some or all of the Securities to a financial
institution that is an

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“accredited investor” as defined in Rule 501(a) under the Securities Act and who
agrees to be bound by the provisions of this Agreement and the Registration
Rights Agreement and, if required under the terms of such arrangement, such
Purchaser may transfer pledged or secured Securities to the pledgees or secured
parties.  Such a pledge or transfer would not be subject to approval of the
Company and no legal opinion of legal counsel of the pledgee, secured party or
pledgor shall be required in connection therewith.  Further, no notice shall be
required of such pledge.  At the appropriate Purchaser’s expense, the Company
will execute and deliver such reasonable documentation as a pledgee or secured
party of Securities may reasonably request in connection with a pledge or
transfer of the Securities, including, if the Securities are subject to
registration pursuant to the Registration Rights Agreement, the preparation and
filing of any required prospectus supplement under Rule 424(b)(3) under the
Securities Act or other applicable provision of the Securities Act to
appropriately amend the list of Selling Stockholders thereunder.

(C)           CERTIFICATES EVIDENCING THE SHARES AND WARRANT SHARES SHALL NOT
CONTAIN ANY LEGEND (INCLUDING THE LEGEND SET FORTH IN SECTION 4.1(B)), (I) WHILE
A REGISTRATION STATEMENT (INCLUDING THE REGISTRATION STATEMENT) COVERING THE
RESALE OF SUCH SECURITY IS EFFECTIVE UNDER THE SECURITIES ACT, OR (II) FOLLOWING
ANY SALE OF SUCH SHARES OR WARRANT SHARES PURSUANT TO RULE 144, OR (III) IF SUCH
SHARES OR WARRANT SHARES ARE ELIGIBLE FOR SALE UNDER RULE 144(K), OR (IV) IF
SUCH LEGEND IS NOT REQUIRED UNDER APPLICABLE REQUIREMENTS OF THE SECURITIES ACT
(INCLUDING JUDICIAL INTERPRETATIONS AND PRONOUNCEMENTS ISSUED BY THE STAFF OF
THE COMMISSION).  THE COMPANY SHALL CAUSE ITS GENERAL COUNSEL TO ISSUE A LEGAL
OPINION TO THE TRANSFER AGENT PROMPTLY AFTER THE EFFECTIVE DATE IF REQUIRED BY
THE TRANSFER AGENT TO EFFECT THE REMOVAL OF THE LEGEND HEREUNDER.  IF ALL OR ANY
PORTION OF A WARRANT IS EXERCISED AT A TIME WHEN THERE IS AN EFFECTIVE
REGISTRATION STATEMENT TO COVER THE RESALE OF THE WARRANT SHARES, SUCH WARRANT
SHARES SHALL BE ISSUED FREE OF ALL LEGENDS.  THE COMPANY AGREES THAT FOLLOWING
THE EFFECTIVE DATE OR AT SUCH TIME AS SUCH LEGEND IS NO LONGER REQUIRED UNDER
THIS SECTION 4.1(C), IT WILL, NO LATER THAN THREE TRADING DAYS FOLLOWING THE
DELIVERY BY A PURCHASER TO THE COMPANY OR THE TRANSFER AGENT OF A CERTIFICATE
REPRESENTING SHARES OR WARRANT SHARES, AS THE CASE MAY BE, ISSUED WITH A
RESTRICTIVE LEGEND (SUCH THIRD TRADING DAY, THE “LEGEND REMOVAL DATE”), DELIVER
OR CAUSE TO BE DELIVERED TO SUCH PURCHASER A CERTIFICATE REPRESENTING SUCH
SHARES THAT IS FREE FROM ALL RESTRICTIVE AND OTHER LEGENDS.  THE COMPANY MAY NOT
MAKE ANY NOTATION ON ITS RECORDS OR GIVE INSTRUCTIONS TO THE TRANSFER AGENT THAT
ENLARGE THE RESTRICTIONS ON TRANSFER SET FORTH IN THIS SECTION.  CERTIFICATES
FOR SECURITIES SUBJECT TO LEGEND REMOVAL HEREUNDER SHALL BE TRANSMITTED BY THE
TRANSFER AGENT TO THE PURCHASER BY CREDITING THE ACCOUNT OF THE PURCHASER’S
PRIME BROKER WITH THE DEPOSITORY TRUST COMPANY SYSTEM AS DIRECTED BY SUCH
PURCHASER.

(D)           IN ADDITION TO SUCH PURCHASER’S OTHER AVAILABLE REMEDIES, THE
COMPANY SHALL PAY TO A PURCHASER, IN CASH, AS PARTIAL LIQUIDATED DAMAGES AND NOT
AS A PENALTY, FOR EACH $1,000 OF SHARES OR WARRANT SHARES (BASED ON THE VWAP OF
THE COMMON STOCK ON THE DATE SUCH SECURITIES ARE SUBMITTED TO THE TRANSFER
AGENT) DELIVERED FOR REMOVAL OF THE RESTRICTIVE LEGEND AND SUBJECT TO SECTION
4.1(C), $10 PER TRADING DAY (INCREASING TO $20 PER TRADING DAY FIVE (5) TRADING
DAYS AFTER SUCH DAMAGES HAVE BEGUN TO ACCRUE) FOR EACH TRADING DAY COMMENCING
TWO (2) TRADING DAYS AFTER THE LEGEND REMOVAL DATE

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UNTIL SUCH CERTIFICATE IS DELIVERED WITHOUT A LEGEND. NOTHING HEREIN SHALL LIMIT
SUCH PURCHASER’S RIGHT TO PURSUE ACTUAL DAMAGES FOR THE COMPANY’S FAILURE TO
DELIVER CERTIFICATES REPRESENTING ANY SECURITIES AS REQUIRED BY THE TRANSACTION
DOCUMENTS, AND SUCH PURCHASER SHALL HAVE THE RIGHT TO PURSUE ALL REMEDIES
AVAILABLE TO IT AT LAW OR IN EQUITY INCLUDING, WITHOUT LIMITATION, A DECREE OF
SPECIFIC PERFORMANCE AND/OR INJUNCTIVE RELIEF.

(E)   EACH PURCHASER, SEVERALLY AND NOT JOINTLY WITH THE OTHER PURCHASERS,
AGREES THAT SUCH PURCHASER WILL SELL ANY SECURITIES PURSUANT TO EITHER THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, INCLUDING ANY APPLICABLE
PROSPECTUS DELIVERY REQUIREMENTS, OR AN EXEMPTION THEREFROM, AND THAT IF
SECURITIES ARE SOLD PURSUANT TO A REGISTRATION STATEMENT, THEY WILL BE SOLD IN
COMPLIANCE WITH THE PLAN OF DISTRIBUTION SET FORTH THEREIN, AND ACKNOWLEDGES
THAT THE REMOVAL OF THE RESTRICTIVE LEGEND FROM CERTIFICATES REPRESENTING
SECURITIES AS SET FORTH IN THIS SECTION 4.1 IS PREDICATED UPON THE COMPANY’S
RELIANCE UPON THIS UNDERSTANDING.

4.2   FURNISHING OF INFORMATION.  AS LONG AS ANY PURCHASER OWNS SECURITIES, 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.  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 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.

4.3   INTEGRATION.  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 IN A MANNER THAT WOULD REQUIRE THE REGISTRATION UNDER THE
SECURITIES ACT OF THE SALE OF THE SECURITIES TO THE PURCHASERS OR THAT WOULD BE
INTEGRATED WITH THE OFFER OR SALE OF THE SECURITIES TO THE PURCHASERS 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.

4.4   SECURITIES LAWS DISCLOSURE; PUBLICITY.  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 FILING 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 OR 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

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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 (I) AS REQUIRED BY FEDERAL
SECURITIES LAW IN CONNECTION WITH (A) ANY REGISTRATION STATEMENT CONTEMPLATED BY
THE REGISTRATION RIGHTS AGREEMENT AND (B) THE FILING OF FINAL TRANSACTION
DOCUMENTS (INCLUDING SIGNATURE PAGES THERETO) WITH THE COMMISSION AND (II) 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 (II).

4.5   SHAREHOLDER RIGHTS PLAN.  NO CLAIM WILL BE MADE OR ENFORCED BY THE COMPANY
OR, TO THE KNOWLEDGE OF THE COMPANY, ANY OTHER PERSON, THAT ANY PURCHASER IS AN
“ACQUIRING PERSON” 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, BY VIRTUE OF RECEIVING SECURITIES UNDER THE TRANSACTION
DOCUMENTS OR UNDER ANY OTHER AGREEMENT BETWEEN THE COMPANY AND THE PURCHASERS.

4.6   NON-PUBLIC INFORMATION.  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 REPRESENTATIONS
IN EFFECTING TRANSACTIONS IN SECURITIES OF THE COMPANY.

4.7   USE OF PROCEEDS.  THE COMPANY SHALL USE THE NET PROCEEDS FROM THE SALE OF
THE SECURITIES HEREUNDER FOR RESEARCH AND DEVELOPMENT, SALES, MARKETING AND
OTHER WORKING CAPITAL PURPOSES AND SHALL NOT USE SUCH PROCEEDS FOR (A) THE
SATISFACTION OF ANY PORTION OF THE COMPANY’S DEBT (OTHER THAN PAYMENT OF TRADE
PAYABLES IN THE ORDINARY COURSE OF THE COMPANY’S BUSINESS AND PRIOR PRACTICES),
(B) THE REDEMPTION OF ANY COMMON STOCK OR COMMON STOCK EQUIVALENTS OR (C) THE
SETTLEMENT OF ANY OUTSTANDING LITIGATION.

4.8   INDEMNIFICATION OF PURCHASERS.   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
“PURCHASER PARTY”) 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’ 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, OR ANY OF

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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’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 (I) FOR ANY SETTLEMENT BY A PURCHASER PARTY EFFECTED
WITHOUT THE COMPANY’S PRIOR WRITTEN CONSENT, WHICH SHALL NOT BE UNREASONABLY
WITHHELD OR DELAYED; OR (II) TO THE EXTENT, BUT ONLY TO THE EXTENT THAT A LOSS,
CLAIM, DAMAGE OR LIABILITY IS ATTRIBUTABLE TO ANY PURCHASER PARTY’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.

4.9        RESERVATION OF COMMON STOCK. 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.

4.10      LISTING OF COMMON STOCK.  THE COMPANY HEREBY AGREES TO USE
COMMERCIALLY REASONABLE EFFORTS TO MAINTAIN THE LISTING OF THE COMMON STOCK ON A
TRADING MARKET. THE COMPANY FURTHER AGREES, IF THE COMPANY APPLIES TO HAVE THE
COMMON STOCK TRADED ON ANY OTHER TRADING MARKET, IT WILL 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 ON SUCH OTHER TRADING MARKET AS PROMPTLY AS POSSIBLE.  THE COMPANY WILL
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’S REPORTING, FILING AND OTHER OBLIGATIONS UNDER THE BYLAWS OR RULES OF
THE TRADING MARKET.

4.11      EQUAL TREATMENT OF PURCHASERS.  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

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AS THE PURCHASERS ACTING IN CONCERT OR AS A GROUP WITH RESPECT TO THE PURCHASE,
DISPOSITION OR VOTING OF SECURITIES OR OTHERWISE.

4.12         SHORT SALES AND CONFIDENTIALITY AFTER THE DATE HEREOF.  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
AT THE DISCUSSION TIME AND ENDING AT THE TIME THAT THE TRANSACTIONS CONTEMPLATED
BY THIS AGREEMENT ARE FIRST PUBLICLY ANNOUNCED AS DESCRIBED IN SECTION 4.4.
 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 ALL DISCLOSURE MADE TO IT IN CONNECTION
WITH THIS TRANSACTION (INCLUDING THE EXISTENCE AND TERMS OF THIS TRANSACTION). 
EACH PURCHASER SEVERALLY AND NOT JOINTLY WITH ANY OTHER PURCHASER, UNDERSTANDS
AND ACKNOWLEDGES, AND AGREES, TO ACT IN A MANNER THAT WILL NOT VIOLATE THE
POSITIONS OF THE COMMISSION AS SET FORTH IN ITEM 65, SECTION A, OF THE MANUAL OF
PUBLICLY AVAILABLE TELEPHONE INTERPRETATIONS, DATED JULY 1997, COMPILED BY THE
OFFICE OF CHIEF COUNSEL, DIVISION OF CORPORATION FINANCE. 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.  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’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’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.

4.13         SUBSEQUENT EQUITY SALES.

(A)           FROM THE DATE HEREOF UNTIL 90 DAYS AFTER THE EFFECTIVE DATE,
NEITHER THE COMPANY NOR ANY SUBSIDIARY SHALL ISSUE SHARES OF COMMON STOCK OR
COMMON STOCK EQUIVALENTS.

(B)           FROM THE DATE HEREOF UNTIL ONE YEAR FROM THE EFFECTIVE DATE, THE
COMPANY SHALL BE PROHIBITED FROM EFFECTING OR ENTERING INTO AN AGREEMENT TO
EFFECT ANY SUBSEQUENT FINANCING INVOLVING A VARIABLE RATE TRANSACTION. 
“VARIABLE RATE TRANSACTION” MEANS A TRANSACTION IN WHICH THE COMPANY ISSUES OR
SELLS (I) ANY DEBT OR EQUITY SECURITIES THAT ARE CONVERTIBLE INTO, EXCHANGEABLE
OR EXERCISABLE FOR, OR INCLUDE THE RIGHT TO RECEIVE ADDITIONAL SHARES OF COMMON
STOCK EITHER (A) AT A CONVERSION, EXERCISE OR EXCHANGE RATE OR OTHER PRICE THAT
IS BASED UPON AND/OR VARIES WITH THE TRADING PRICES OF OR QUOTATIONS FOR THE
SHARES OF COMMON STOCK AT ANY TIME AFTER THE INITIAL ISSUANCE OF SUCH DEBT OR
EQUITY SECURITIES, OR (B) WITH A CONVERSION, EXERCISE OR EXCHANGE PRICE THAT IS
SUBJECT TO BEING RESET AT SOME FUTURE DATE AFTER THE INITIAL ISSUANCE OF SUCH
DEBT OR EQUITY SECURITY OR UPON THE OCCURRENCE OF SPECIFIED OR CONTINGENT EVENTS
DIRECTLY OR INDIRECTLY RELATED TO THE BUSINESS OF THE COMPANY OR THE MARKET FOR
THE COMMON STOCK OR (II) ENTERS INTO ANY AGREEMENT, INCLUDING, BUT NOT LIMITED
TO, AN EQUITY LINE OF CREDIT, WHEREBY THE COMPANY MAY SELL SECURITIES AT A
FUTURE DETERMINED PRICE.  ANY PURCHASER SHALL BE ENTITLED TO OBTAIN

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INJUNCTIVE RELIEF AGAINST THE COMPANY TO PRECLUDE ANY SUCH ISSUANCE, WHICH
REMEDY SHALL BE IN ADDITION TO ANY RIGHT TO COLLECT DAMAGES.

(C)           NOTWITHSTANDING THE FOREGOING, THIS SECTION 4.13 SHALL NOT APPLY
IN RESPECT OF AN EXEMPT ISSUANCE, EXCEPT THAT NO VARIABLE RATE TRANSACTION SHALL
BE AN EXEMPT ISSUANCE.

4.14         DELIVERY OF SECURITIES AFTER CLOSING.  THE COMPANY SHALL DELIVER,
OR CAUSE TO BE DELIVERED, THE RESPECTIVE SECURITIES PURCHASED BY EACH PURCHASER
TO SUCH PURCHASER WITHIN FIVE (5) TRADING DAYS OF THE CLOSING DATE.

4.15         FORM D; BLUE SKY FILINGS.  THE COMPANY AGREES TO USE COMMERCIALLY
REASONABLE EFFORTS TO TIMELY FILE A FORM D WITH RESPECT TO THE SECURITIES AS
REQUIRED UNDER REGULATION D AND TO PROVIDE A COPY THEREOF, PROMPTLY UPON REQUEST
OF ANY PURCHASER. THE COMPANY SHALL TAKE SUCH ACTION AS THE COMPANY SHALL
REASONABLY DETERMINE IS NECESSARY IN ORDER TO OBTAIN AN EXEMPTION FOR, OR TO
QUALIFY THE SECURITIES FOR, SALE TO THE PURCHASERS AT THE CLOSING UNDER
APPLICABLE SECURITIES OR “BLUE SKY” LAWS OF THE STATES OF THE UNITED STATES, AND
SHALL PROVIDE EVIDENCE OF SUCH ACTIONS PROMPTLY UPON REQUEST OF ANY PURCHASER.

4.16         GOOD STANDING IN NEW JERSEY.  THE COMPANY SHALL TAKE ALL STEPS
NECESSARY TO REGAIN ITS AUTHORITY TO DO BUSINESS AS A FOREIGN CORPORATION IN THE
STATE OF NEW JERSEY AT THE EARLIEST POSSIBLE TIME.

ARTICLE V.
MISCELLANEOUS

5.1           TERMINATION.  THIS AGREEMENT MAY BE TERMINATED BY ANY PURCHASER,
AS TO SUCH PURCHASER’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 JULY 7, 2007; PROVIDED, HOWEVER, THAT NO SUCH TERMINATION WILL AFFECT
THE RIGHT OF ANY PARTY TO SUE FOR ANY BREACH BY THE OTHER PARTY (OR PARTIES).

5.2           FEES AND EXPENSES.  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.

5.3           ENTIRE AGREEMENT.  THE TRANSACTION DOCUMENTS, TOGETHER WITH THE
EXHIBITS AND SCHEDULES THERETO, 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.

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5.4           NOTICES.  ANY AND ALL NOTICES OR OTHER COMMUNICATIONS OR
DELIVERIES REQUIRED OR PERMITTED TO BE PROVIDED HEREUNDER SHALL BE IN WRITING
AND SHALL BE DEEMED GIVEN AND EFFECTIVE ON THE EARLIEST OF (A) THE 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 SECOND 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.

5.5           AMENDMENTS; WAIVERS.  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 OF AT LEAST 67% OF THE SHARES STILL HELD BY
THE PURCHASERS 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.

5.6           HEADINGS.  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.

5.7           SUCCESSORS AND ASSIGNS.  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
“PURCHASERS.”

5.8           NO THIRD-PARTY BENEFICIARIES.  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.

5.9           GOVERNING LAW.  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

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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’ FEES AND OTHER COSTS
AND EXPENSES INCURRED WITH THE INVESTIGATION, PREPARATION AND PROSECUTION OF
SUCH ACTION OR PROCEEDING.

5.10         SURVIVAL.  THE REPRESENTATIONS AND WARRANTIES CONTAINED HEREIN
SHALL SURVIVE THE CLOSING FOR A PERIOD OF THREE (3) YEARS AND THE DELIVERY OF
THE SHARES AND WARRANT SHARES.

5.11         EXECUTION.  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 “.PDF” 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 “.PDF” SIGNATURE PAGE WERE AN ORIGINAL
THEREOF.

5.12         SEVERABILITY.  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.

5.13         RESCISSION AND WITHDRAWAL RIGHT.  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; PROVIDED,
HOWEVER, IN THE CASE OF A RESCISSION OF AN EXERCISE OF A WARRANT, THE PURCHASER
SHALL BE REQUIRED TO RETURN ANY SHARES OF COMMON STOCK DELIVERED IN CONNECTION
WITH ANY SUCH RESCINDED EXERCISE NOTICE.

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5.14         REPLACEMENT OF SECURITIES.  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.

5.15         REMEDIES.  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 AGREES 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.

5.16         PAYMENT SET ASIDE.  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.

5.17         INDEPENDENT NATURE OF PURCHASERS’ OBLIGATIONS AND RIGHTS.  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 RODMAN & RENSHAW LLC AND ROTH
CAPITAL PARTNERS, LLC, WHO HAS ACTED AS PLACEMENT AGENTS TO THE TRANSACTION AND
THE COMPANY THROUGH FWS.  FWS DOES NOT REPRESENT THE PURCHASERS BUT ONLY RODMAN
& RENSHAW LLC.  THE COMPANY HAS ELECTED TO PROVIDE ALL PURCHASERS WITH THE SAME
TERMS AND TRANSACTION DOCUMENTS

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FOR THE CONVENIENCE OF THE COMPANY AND NOT BECAUSE IT WAS REQUIRED OR REQUESTED
TO DO SO BY THE PURCHASERS.

5.18         LIQUIDATED DAMAGES.  THE COMPANY’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.

5.19         SATURDAYS, SUNDAYS, HOLIDAYS, ETC.  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.

5.20         CONSTRUCTION. 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.

5.21         WAIVER OF JURY TRIAL.  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.

(Signature Pages Follow)

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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.

 

CYTOGEN CORPORATION

Address for Notice:

 

650 College Road East, Suite 3100,

 

Princeton, New Jersey 08540

 

Fax: (609) 452-2434

By:

/s/ Kevin J. Bratton

 

 

 

Name: Kevin J. Bratton

 

 

Title: Senior Vice President, Finance

 

And Chief Financial Officer

 

 

 

With a copy to (which shall not constitute notice):

 

 

 

Emilio Ragosa, Esq.

 

Morgan, Lewis & Bockius LLP

 

502 Carnegie Center

 

Princeton, New Jersey 08540

 

Fax: (609) 919-6701

 

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK

SIGNATURE PAGE FOR PURCHASER FOLLOWS]

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[PURCHASER SIGNATURE PAGES TO CYTO
SECURITIES PURCHASE AGREEMENT]

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.

Name of Purchaser:

 

 

 

 

Signature of Authorized Signatory of Purchaser:

 

 

 

 

Name of Authorized Signatory:

 

 

 

 

Title of Authorized Signatory:

 

 

 

 

Email Address of Purchaser:

 

 

 

 

Fax Number of Purchaser:

 

 

 

 

Address for Notice of Purchaser:

 

 

 

Address for Delivery of Securities for Purchaser (if not same as address for
notice):

 

Subscription Amount: $

 

 

 

Shares:

 

 

 

Warrant Shares:

 

 

 

EIN Number:  [PROVIDE THIS UNDER SEPARATE COVER]

[SIGNATURE PAGES CONTINUE]

33

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Schedule of Purchasers

Name

 

Number of Shares

 

Number of Warrants

 

Purchase Price

 

Hudson Bay Fund LP

 

247,553

 

123,777

 

$

429,999.82

 

Hudson Bay Overseas Fund LTD

 

328,152

 

164,076

 

$

569,999.76

 

Fort Mason Master, L.P.

 

675,806

 

337,903

 

$

1,173,875.02

 

Fort Mason Partners, L.P.

 

43,826

 

21,913

 

$

76,125.76

 

J.P. Morgan Ventures Corporation

 

2,000,000

 

1,000,000

 

$

3,474,000.00

 

Capital Ventures International by Heights Capital Management, Inc.

 

580,000

 

290,000

 

$

1,007,460.00

 

Radcliffe SPC, Ltd. for and on behalf of the Class A Segregated Portfolio

 

575,705

 

287,853

 

$

1,000,000.00

 

First Eagle Value in Biotechnology Master Fund, Ltd

 

569,948

 

284,974

 

$

990,000.00

 

First Eagle Value in Biotechnology Fund, LP

 

164,076

 

82,038

 

$

285,000.00

 

First Eagle Contrarian Value Master Fund, Ltd

 

129,534

 

64,767

 

$

225,000.00

 

Caduceus Capital Master Fund Limited

 

190,000

 

95,000

 

$

330,030.00

 

Caduceus Capital II, L.P.

 

125,000

 

62,500

 

$

217,125.00

 

Summer Street Life Sciences Hedge Fund

 

185,000

 

92,500

 

$

321,345.00

 

 

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