EX-10.18 Warrant to purchase 39,450 shares



 





EXHIBIT 10.18




Warrant Agreement No. ________




NEITHER THIS WARRANT NOR THE COMMON STOCK WHICH MAY BE ACQUIRED UPON EXERCISE HEREOF HAS BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS,
AND MAY NOT BE SOLD, OFFERED FOR SALE, TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT WITH RESPECT THERETO UNDER THE ACT AND ANY
APPLICABLE STATE SECURITIES LAWS, OR UNLESS THE COMPANY RECEIVES AN OPINION OF COUNSEL,
SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION IS NOT REQUIRED.



June ______, 2007




BIOHEART, INC.




(Incorporated under the laws of the State of Florida)




Warrant for the Purchase of Shares of Common Stock




     FOR VALUE RECEIVED, BIOHEART, INC., a Florida corporation (the “Company”), hereby
certifies that William P. Murphy, Jr. M.D. (the “Initial Holder”), or his/her/its assigns
(the “Holder”) is entitled, subject to the provisions of this Warrant, to purchase from the
Company, up to 39,450 (subject to adjustment in accordance with the four immediately succeeding
paragraphs and Section 5 below) (the “Subject Shares”) fully paid and non-assessable shares
of Common Stock at a price of $4.75 per share, subject to adjustment in accordance with Section 5
below (the “Exercise Price”) . This Warrant is being issued in connection with
that certain Loan Guarantee, Payment and Security Agreement by and between the Company and the
Initial Holder, dated as of June 1, 2007 (the “Guarantee Agreement”).



     In the event that, as of September 30, 2007, the Company has not satisfied and/or discharged
all of its payment obligations, including, without limitation, all payment obligations under the
agreements, documents and instruments entered into in connection therewith (a “Loan
Satisfaction”) under that certain $5,000,000 Loan borrowed by the Company from Bank of America,
N.A. (the “Bank of America Loan”), the number of Subject Shares shall be automatically
increased to 45,000 shares without any action required on the part of the Company or the Holder.



     In the event that, as of the first year anniversary of the closing of the Bank of America Loan
(the “Closing Date”), the Company has not satisfied and/or discharged all of its material



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payment obligations to the Initial Holder under the Guarantee Agreement (a “Guarantee
Satisfaction”), the number of Subject Shares shall be automatically increased to 56,250 shares
without any action required on the part of the Company or the Holder.



     In the event that, as of the second year anniversary of the Closing Date, the Company has not
effectuated a Guarantee Satisfaction, the number of Subject Shares shall be automatically increased
to 75,000 shares without any action required on the part of the Company or the Holder.



     In the event that, as of the third year anniversary of Closing Date, the Company has not
effectuated a Guarantee Satisfaction, the number of Subject Shares shall be automatically increased
to 112,500 shares without any action required on the part of the Company or the Holder.



     Notwithstanding the immediately preceding four paragraphs to the contrary, a failure to timely
effectuate a Guarantee Satisfaction shall be without prejudice to the Initial Holder’s (and/or its
assign’s or successor’s in interest in respect of the Guarantee Agreement) rights with respect to
the Guarantee Agreement, it being understood that adjustments to the Subject Shares relating to the
Company’s failure to effectuate a Guarantee Satisfaction shall be an additional right of the Holder
(and/or such successor or assign).



     The number of Subject Shares are also subject to adjustment in accordance with Section 5
below.



     The term “Common Stock” means the Common Stock, par value $.001 per share, of the
Company as constituted on June 1, 2007 (the “Base Date”). The number of Subject Shares
shall be adjusted from time to time as set forth herein. The shares of Common Stock deliverable
upon such exercise, and as adjusted from time to time, are hereinafter referred to as “Warrant
Stock.” The term “Other Securities” means any other equity or debt securities that may
be issued by the Company in addition thereto or in substitution for the Warrant Stock. The term
“Company” means and includes the corporation named above as well as (i) any immediate or
more remote successor entity resulting from the merger or consolidation of such entity (or any
immediate or more remote successor corporation of such entity) with another entity, or (ii) any
entity to which such entity (or any immediate or more remote successor corporation of such
corporation) has transferred its all or substantially all of its property or assets.



     Upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft,
destruction or mutilation of this Warrant, and (in the case of loss, theft or destruction) of
indemnification reasonably satisfactory to the Company, and upon surrender and cancellation of this
Warrant, if mutilated, the Company shall execute and deliver a new Warrant of like tenor and date.
Any such new Warrant executed and delivered shall constitute an additional contractual obligation
on the part of the Company, whether or not this Warrant so lost, stolen, destroyed or mutilated
shall be at any time enforceable by anyone.



     The Holder agrees with the Company that this Warrant is issued, and all the rights hereunder
shall be held subject to, all of the conditions, limitations and provisions set forth
herein.



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     1. Exercise of Warrant.



          (a) Subject to Section 1(b) below and in accordance with the procedures set forth in Section
1(c) below, this Warrant may be exercised, in whole or in part, at any time, or from time to time
during the period commencing on the date that is three hundred and sixty-six (366) days following
the date of the closing (the “Closing Date”) of the Bank of America Loan (the “One Year
Exercise Date”) and expiring at 5:00 p.m. Eastern Time on the date that is ten years following
the Closing Date (the “Expiration Date”).



          (b) Notwithstanding Section 1(a) above, in no event shall the Holder be entitled to exercise
this Warrant until such time that the Company effectuates a Loan Satisfaction; provided, however,
that if, as of the eight month anniversary of the Closing Date, the Company has not effectuated a
Loan Satisfaction but the Initial Holder has complied in full with all of its material obligations
under the Guarantee Agreement, this Section 1(b) shall have no further force and effect.



          (c) During the period that this Warrant is exercisable in accordance with Sections 1(a) and
1(b) above, the Holder may exercise this Warrant by presentation and surrender of this Warrant to
the Company at its principal office, or at the office of its stock transfer agent, if any, together
with the Warrant Exercise Form, attached hereto as Exhibit A, duly executed and the
Shareholders Agreement, attached hereto as Exhibit B (the “Shareholders
Agreement”), duly executed, accompanied by payment (either in cash or by certified or official
bank check, payable to the order of the Company) of the Exercise Price for the number of shares
specified in such form and instruments of transfer, if appropriate, duly executed by the Holder or
his, her or its duly authorized attorney. If this Warrant should be exercised in part only, the
Company shall, upon surrender of this Warrant for cancellation, execute and deliver a new Warrant
evidencing the rights of the Holder thereof to purchase the balance of the shares purchasable
hereunder. Upon receipt by the Company of this Warrant, together with a duly executed Warrant
Exercise Form , a duly executed Shareholders Agreement and the Exercise Price, at its office, or by
the stock transfer agent of the Company at its office, in proper form for exercise, the Holder
shall, subject to compliance with any applicable securities laws, be deemed to be the holder of
record of the shares of Common Stock issuable upon such exercise, notwithstanding that the stock
transfer books of the Company shall then be closed or that certificates representing such shares of
Common Stock shall not then be actually delivered to the Holder.



          (d) In the event the Initial Holder commits a Key Default (as defined in the Guarantee
Agreement), this Warrant shall be automatically cancelled, without any action required on the part
of the Company or the Holder, and shall have no further force and effect.



          (e) During the period that this Warrant is exercisable in accordance with Sections 1(a) and
1(b) above and provided that (i) the Company’s Common Stock is publicly



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traded and (ii) the average reported weekly trading volume during the four weeks preceding the
date of exercise is equal to or greater than 2,500,000, in lieu of exercising this Warrant by
tendering cash pursuant to Section 3(c) above, the Holder of this Warrant may elect to receive,
without the payment by the Holder of any additional consideration, shares equal to the value of
this Warrant (or the portion thereof being canceled) by surrender of this Warrant at the principal
office of the Company together with notice of such election, in which event the Company shall issue
to the holder hereof a number of Shares computed using the following formula:



	 	 	 	 	 
	 

	 	 	 	Y (A - B)
	X

	 	=
	 	 

A






     Where:



     X   =   The number of shares to be issued to the Holder pursuant to this net exercise;



     Y   =   The number of shares in respect of which the net issue election is made;



     A   =   The fair market value of one share at the time the net issue election is made; and



     B   =   The Exercise Price (as adjusted to the date of the net issuance).



     For purposes of this paragraph 3(e), the “fair market value” of one share of Common Stock as
of a particular date shall mean the closing price (or average of the closing “bid” and “asked”
prices, as the case may be) on the applicable date (i.e. the date of exercise of Warrant) of the
Common Stock as reported by Bloomberg L.P. on the applicable market upon which the Common Stock is
traded.



     2. Reservation of Shares. The Company covenants that during the term this Warrant is
exercisable, the Company will reserve from its authorized and unissued Common Stock a sufficient
number of shares to provide for the issuance of Common Stock upon the exercise of this Warrant and,
from time to time, if necessary, will use its reasonable best efforts to amend its Articles of
Incorporation to provide sufficient reserves of shares of Common Stock issuable upon exercise of
the Warrant.



     3. Fractional Shares. No fractional shares or scrip representing fractional shares
shall be issued upon the exercise of this Warrant, but the Company shall issue one additional share
of its Common Stock or Other Securities (as applicable) in lieu of each fraction of a share
otherwise called for upon exercise of this Warrant.



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     4. Transfer of Warrant.



          (a) Subject to compliance with any applicable federal and state securities laws, the
conditions set forth in Sections 4(b) below and the provisions of Section 7 of this Warrant, this
Warrant may be transferred by the Holder with respect to any or all of the shares purchasable
hereunder. Upon surrender of this Warrant to the Company or at the office of its stock transfer
agent, if any, together with the Assignment Form, attached hereto as Exhibit C duly
executed, the Transferor Representation Letter (as defined below) duly executed, the Transferee
Representation Letter (as defined below) duly executed and funds sufficient to pay any transfer
tax, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or
assignees and in the denomination or denominations specified in the Assignment Form and shall issue
to the assignor a new Warrant evidencing the portion of this Warrant not so assigned. Thereafter,
this Warrant shall promptly be cancelled. This Warrant may be divided or combined with other
Warrants that carry the same rights upon presentation hereof at the office of the Company or at the
office of its stock transfer agent, if any, together with a written notice specifying the names and
denominations in which new Warrants are to be issued and signed by the Holder hereof.
Notwithstanding the foregoing, the Company shall not be required to issue a Warrant covering less
than 1,000 shares of Common Stock.



          (b) Notwithstanding anything to the contrary set forth herein, no transfer of all or any
portion of this Warrant shall be made except for transfers to the Company, unless:



               (x) if such transfer is made at any time prior to the One Year Exercise Date, the Holder and
the proposed transferee each truthfully certify and provide to the Company a written representation
letter (the “Transferor Representation Letter” and the “Transferee Representation
Letter”, respectively) that such transfer is to either:



                    (A) a “Qualified Institutional Buyer” as such term is defined under Rule 144A of the
Securities Act, attached hereto as Exhibit D;



                    (B) a “large institutional accredited investor” as such term is used in the Securities and
Exchange Commission staff’s No-Action Letter dated February 28, 1992 to Squadron, Ellenoff,
Pleasant & Lehrer, attached hereto as Exhibit E; or



                    (C) a person that is (1) an “accredited investor” within the meaning of Regulation D under the
Securities Act (an “Accredited Investor”), (2) as of the Effective Date (as defined in the
Guarantee Agreement) and the date of such transfer, is an executive officer of the Company or a
member of the Company’s management; and (3) participated in assisting the Company structure
the issuance of this Warrant to the (x) Guarantor (as defined in the Guarantee Agreement) and (y)
any other persons receiving warrants in connection with their provision of a guaranty or letter of
credit to secure the Bank of America Loan.



               (y) if such transfer is made at any time following the One Year Exercise Date, the
Holder and the proposed transferee each truthfully certify and provide to the
Company the Transferor Representation Letter and the Transferee Representation Letter,
respectively that such transfer is to an Accredited Investor.



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     5. Anti-Dilution Provisions.



          5.1 Adjustment for Dividends in Other Securities, Property, Etc. In case at any time
or from time to time after the Base Date the shareholders of the Company shall have received, or on
or after the record date fixed for the determination of eligible shareholders, shall have become
entitled to receive without payment therefor: (a) other or additional securities or property (other
than cash) by way of dividend, (b) any cash paid or payable or (c) other or additional (or less)
securities or property (including cash) by way of stock-split, spin-off, split-up,
reclassification, combination of shares or similar corporate rearrangement, then, and in each such
case, the Holder of this Warrant, upon the exercise thereof as provided in Section 1, shall
be entitled to receive the amount of securities and property (including cash in the cases referred
to in clauses (b) and (c) above) which such Holder would hold on the date of such exercise if on
the Base Date it had been the holder of record of the number of shares of Common Stock or Other
Securities (as applicable) as constituted on the Base Date subscribed for upon such exercise as
provided in Section 1 and had thereafter, during the period from the Base Date to and
including the date of such exercise, retained such shares and/or all other additional (or less)
securities and property (including cash in the cases referred to in clauses (b) and (c) above)
receivable by it as aforesaid during such period, giving effect to all adjustments called for
during such period by this Section 5.1 and Sections 5.2 and 5.3 below.



          5.2 Adjustment for Recapitalization. If the Company shall at any time subdivide its
outstanding shares of Common Stock (or Other Securities at the time receivable upon the exercise of
the Warrant), or if the Company shall declare a stock dividend or distribute shares of Common Stock
(or Other Securities) to its shareholders, the number of shares of Common Stock (or Other
Securities, as the case may be) subject to this Warrant immediately prior to such subdivision shall
be proportionately increased and the Exercise Price shall be proportionately decreased, and if the
Company shall at any time combine the outstanding shares of Common Stock, the number of shares of
Common Stock or Other Securities subject to this Warrant immediately prior to such combination
shall be proportionately decreased and the Exercise Price shall be proportionately increased. Any
such adjustments pursuant to this Section 5.2 shall be effective at the close of business
on the effective date of such subdivision or combination or if any adjustment is the result of a
stock dividend or distribution then the effective date for such adjustment based thereon shall be
the record date therefor.



          5.3 Adjustment for Reorganization, Consolidation, Merger, Etc. In case of any
reorganization of the Company (or any other entity, the securities of which are at the time
receivable on the exercise of this Warrant) after the Base Date or in case after such date the
Company (or any such other entity) shall consolidate with or merge into another corporation or
convey all or substantially all of its assets to another corporation, then, and in each such case,
the Holder of this Warrant upon the exercise thereof as provided in Section 1 at any time
after the consummation of such reorganization, consolidation, merger or conveyance, shall be
entitled to receive, in lieu of the securities and property receivable upon the exercise of this
Warrant prior to
such consummation, the securities or property to which such Holder would have been entitled
upon such consummation if such Holder had exercised this Warrant immediately prior thereto; in each
such case, the terms of this Warrant shall be applicable to the securities or property receivable
upon the exercise of this Warrant after such consummation.



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          5.4 No Impairment. The Company will not, by amendment of its Articles of Incorporation
(or the Shareholders Agreement) or through reorganization, consolidation, merger, dissolution,
issue or sale of securities, sale of assets or any other voluntary action, avoid or seek to avoid
the observance or performance of any of the terms of this Warrant, but will at all times in good
faith assist in the carrying out of all such terms and in the taking of all such action as may be
necessary or appropriate in order to protect the rights of the Holder of this Warrant against
impairment. Without limiting the generality of the foregoing, while this Warrant is outstanding,
the Company will take all such action as may be necessary or appropriate in order that the Company
may validly and legally issue or sell fully paid and non-assessable shares of capital stock upon
the exercise of this Warrant.



          5.5 Certificate as to Adjustments. In each case of an adjustment in the number of
shares of Warrant Stock or Other Securities receivable on the exercise of this Warrant, the Company
at its expense will promptly compute such adjustment in accordance with the terms of this Warrant
and prepare a certificate executed by an executive officer of the Company setting forth such
adjustment and showing in detail the facts upon which such adjustment is based. The Company will
forthwith mail a copy of each such certificate to the Holder.



          5.6 Notices of Record Date, Etc. In case:



          (a) the Company shall take a record of the holders of its Common Stock (or Other Securities at
the time receivable upon the exercise of the Warrant) for the purpose of entitling them to receive
any dividend (other than a cash dividend at the same rate as the rate of the last cash dividend
theretofore paid) or other distribution, or any right to subscribe for, purchase or otherwise
acquire any shares of stock of any class or any other securities, or to receive any other right; or



          (b) of any capital reorganization of the Company, any reclassification of the capital stock of
the Company, any consolidation or merger of the Company with or into another corporation, or any
conveyance of all or substantially all of the assets of the Company to another corporation; or



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          (c) of any voluntary or involuntary dissolution, liquidation or winding up of the Company,



then, and in each such case, the Company shall mail or cause to be mailed to the Holder of the
Warrant at the time outstanding a notice specifying, as the case may be, (i) the date on which a
record is to be taken for the purpose of such dividend, distribution or right, and stating the
amount and character of such dividend, distribution or right, or (ii) the date on which such
reorganization, reclassification, consolidation, merger, conveyance, dissolution, liquidation or
winding up is to take place, and the time, if any, which is to be fixed, as to which the holders of
record of Common Stock (or such other securities at the time receivable upon the exercise of the
Warrant) shall be entitled to exchange their shares of Common Stock (or such other securities) for
securities or other property deliverable upon such reorganization, reclassification, consolidation,
merger, conveyance, dissolution, liquidation or winding up. Such notice shall be mailed at least
twenty (20) days prior to the date therein specified and the Warrant may be exercised prior to said
date during the term of the Warrant.



     6. Legend. Unless the shares of Warrant Stock or Other Securities have been registered
under the Securities Act, upon exercise of any of the Warrants and the issuance of any of the
shares of Warrant Stock or Other Securities, all certificates representing such securities shall
bear on the face thereof substantially the following legend:



“The securities represented by this certificate have not been registered
under the Securities Act of 1933, as amended (the “Act”) and may not be sold
or transferred in the absence of an effective registration statement under
the Act or an opinion of counsel satisfactory to the Company that such
registration is not required. The securities represented by this
certificate are subject to certain restrictions and agreements contained in,
that certain Warrant Agreement dated ___, 2007, by and between the original
Holder and the Company and, may not be sold, assigned, transferred,
encumbered, pledged or otherwise disposed of except upon compliance with the
provisions of such Warrant Agreement. By the acceptance of the shares of
capital stock evidenced by this certificate, the holder agrees to be bound
by such Warrant Agreement and all amendments thereto. A copy of such
Warrant Agreement has been filed at the office of the Company.



The securities represented by this certificate and the holder of such
securities are subject to the terms and conditions (including, without
limitation, voting agreements and restrictions on transfer) set forth in a
Shareholders Agreement, dated as of ___, 200___, a copy of which may be
obtained from the Company. No transfer of such securities will be made on
the books of the Company unless accompanied by evidence of compliance with
the terms of such agreement.”



     7. Lock-Up Agreement. The Holder hereby agrees that, during the period of duration
(not to exceed one hundred eighty (180) days) specified by the Company and an underwriter of Common
Stock or other securities of the Company in an agreement in connection with any initial public
offering of the Company’s securities, following the effective date of the registration statement
for a public offering of the Company’s securities filed under the Securities Act, it shall not, to
the extent requested by the Company and such underwriter, directly or
indirectly sell, offer to sell, contract to sell (including, without limitation, any short
sale), grant any option to purchase or otherwise transfer or dispose of (other than to donees who
agree to be similarly bound) any securities of the Company held by it at any time during such
period, except Common Stock, if any, included in such registration; provided, that such “lock-up”
period applicable to the Holder shall not be greater than the shortest lock-up period restricting
any other shareholder of the Company executing lock-up agreements in connection with such
registration.



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     8. No Voting Rights as a Shareholder. This Warrant does not entitle the Holder to any
voting rights or other rights as a shareholder of the Company.



     9. Registration Under the Securities Act of 1933.



          9.1 Piggyback Registration. If at any time during the period commencing on the date
that is six months following the closing date of an initial public offering of the Common Stock and
ending on the Expiration Date, the Company proposes to register any shares of its Common Stock
under the Securities Act on any form for registration thereunder (the “Registration
Statement”) for its own account or the account of shareholders (other than a registration
solely relating to (i) shares of Common Stock underlying a stock option, restricted stock, stock
purchase or compensation or incentive plan or of stock issued or issuable pursuant to any such
plan, or a dividend investment plan; (ii) a registration of securities proposed to be issued in
exchange for securities or assets of, or in connection with a merger or consolidation with, another
corporation or other entity; or (iii) a registration of securities proposed to be issued in
exchange for other securities of the Company (collectively, an “Excluded Registration”)),
it will at such time give prompt written notice to the Holder of its intention to do so (the
“Section 9.1 Notice”). Upon the written request of the Holder given to the Company within
ten (10) days after the giving of any Section 9.1 Notice setting forth the number of shares of
Warrant Stock and/or Other Securities intended to be disposed of by the Holder and the intended
method of disposition thereof, the Company will include or cause to be included in the Registration
Statement the shares of Warrant Stock and/or Other Securities which the Holder has requested to
register, to the extent provided in this Section 9 (a “Piggyback Registration”).
Notwithstanding the foregoing, in the event that prior to the Six-Month Post-IPO Exercise Date, the
Company agrees to (other than in an Excluded Registration) (i) register the resale of Common Stock
then held by any other shareholder of the Company or (ii) register the issuance of Common Stock
upon conversion of then outstanding securities, the Holder shall be similarly entitled to exercise
the rights provided by this Section 9.1. Notwithstanding the foregoing, the Company may, at any
time, withdraw or cease proceeding with any registration pursuant to this Section 9.1 if it shall
at the same time withdraw or cease proceeding with the registration of all of the Common Stock
originally proposed to be registered. The Company shall be obligated to file and cause the
effectiveness of only one (1) Piggyback Registration. The shares of Warrant Stock and/or Other
Securities subject to the piggyback registration rights set forth in the Section 9.1 Notice are
referred to for purposes of this Section 9 as the “Registrable Shares”.



          9.2 Company Covenants. Whenever required under this Section 9 to include Registrable
Shares in a Registration Statement, the Company shall, as expeditiously as
reasonably possible:



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          (i) Use its commercially reasonable efforts to cause such Registration Statement to become
effective and cause such Registration Statement to remain effective until the earlier of the Holder
having completed the distribution of all its Registrable Shares described in the Registration
Statement or six (6) months from the effective date of the Registration Statement (or such later
date by reason of suspensions the effectiveness as provided hereunder). The Company will also use
its commercially reasonable efforts to, during the period that such Registration Statement is
required to be maintained hereunder, file such post-effective amendments and supplements thereto as
may be required by the Securities Act and the rules and regulations thereunder or otherwise to
ensure that the Registration Statement does not contain any untrue statement of material fact or
omit to state a fact required to be stated therein or necessary to make the statements contained
therein, in light of the circumstances under which they are made, not misleading; provided,
however, that if applicable rules under the Securities Act governing the obligation to file a
post-effective amendment permits, in lieu of filing a post-effective amendment that (i) includes
any prospectus required by Section 10(a)(3) of the Securities Act or (ii) reflects facts or events
representing a material or fundamental change in the information set forth in the Registration
Statement, the Company may incorporate by reference information required to be included in (i) and
(ii) above to the extent such information is contained in periodic reports filed pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)
in the Registration Statement.



          (ii) Prepare and file with the Unites States Securities and Exchange Commission (the
“SEC”) such amendments and supplements to such Registration Statement, and the prospectus
used in connection with such Registration Statement, as may be necessary to comply with the
provisions of the Securities Act with respect to the disposition of all securities covered by such
Registration Statement.



          (iii) Furnish to the Holder such numbers of copies of a prospectus, including a preliminary
prospectus as amended or supplemented from time to time, in conformity with the requirements of the
Securities Act, and such other documents as it may reasonably request in order to facilitate the
disposition of Registrable Shares owned by the Holder; provided that, in no event, shall the
Company be required to incur printing expenses in excess of $1,000 in complying with its
obligations under this Section 9.2(iii).



          (iv) Use its commercially reasonable efforts to register and qualify the securities covered by
such Registration Statement under such other federal or state securities laws of such jurisdictions
as shall be reasonably requested by the Holder; provided, however, that the Company shall not be
required in connection therewith or as a condition thereto to qualify to do business or to file a
general consent to service of process in any such states or jurisdictions, unless the Company is
already subject to service in such jurisdiction and except as may be required by the Securities
Act.



          (v) In the event of any underwritten public offering, enter into and perform its obligations
under an underwriting agreement, in usual and customary form, with the managing underwriter of such
offering.



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          (vi) Notify the Holder, at any time when a prospectus relating thereto is required to be
delivered under the Securities Act, (a) when the Registration Statement or any post-effective
amendment and supplement thereto has become effective; (b) of the issuance by the SEC of any stop
order or the initiation of proceedings for that purpose (in which event the Company shall make use
commercially reasonable efforts to obtain the withdrawal of any order suspending effectiveness of
the Registration Statement. at the earliest possible time or prevent the entry thereof); (c) of the
receipt by the Company of any notification with respect to the suspension of the qualification of
the Registrable Shares for sale in any jurisdiction or the initiation of any proceeding for such
purpose; and (d) of the happening of any event as a result of which the prospectus included in such
Registration Statement, as then in effect, includes an untrue statement of a material fact or omits
to state a material fact required to be stated therein or necessary to make the statements therein
not misleading in the light of the circumstances then existing.



          (vii) Cause all such Registrable Shares registered hereunder to be listed on each securities
exchange or quotation service on which similar securities issued by the Company are then listed or
quoted.



          (viii) Provide a transfer agent and registrar for all Registrable Shares registered pursuant
hereunder and CUSIP number for all such Registrable Shares, in each case not later than the
effective date of such registration.



          (ix) Use commercially reasonable effort to furnish, on the date that such Registrable Shares
are delivered to the underwriters for sale, if such securities are being sold through underwriters,
(a) an opinion, dated as of such date and addressed to the Holder, of the counsel representing the
Company for the purposes of such resale registration, in form and substance as is customarily given
by Company counsel to underwriters, if any, engaged by the Holder and (b) a letter, dated as of
such date and addressed to the Holder, from the independent certified public accountants of the
Company, in form and substance as is customarily given by independent certified public accountants
to underwriters, if any, engaged by the Holder.



          9.3 Furnish Information. In connection with a registration in which the Holder is
participating, such Holder agrees to execute and deliver such other agreements as may be reasonably
requested by the Company or the underwriter. In addition, if requested by the Company or the
representative of the underwriters of Common Stock (or other securities) of the Company, the Holder
shall provide, within ten (10) days of such request, such information related to such Holder as may
be required by the Company or such representative in connection with the completion of any public
offering of the Company’s securities pursuant to a registration statement filed under the
Securities Act.



          9.4 Expenses of Company Registration. All expenses other than underwriting
discounts and commissions incurred in connection with registrations, filings or qualifications
pursuant to Section 9.1, including, without limitation, all registration, filing and qualification
fees, printers’ and accounting fees and fees, disbursements of counsel for the Company and
disbursements of counsel for the Holder up to $10,000 (the “Registration Expenses”) shall
be borne by the Company.



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          9.5 Underwriting Requirements. In connection with any offering involving an
underwriting of shares of the Company’s capital stock, the Company shall not be required under
Section 9.1 to include any of the Holder’s Registrable Shares in such underwriting unless the
Holder accepts the terms of the underwriting as agreed upon between the Company and the
underwriters selected by it (or by other persons entitled to select the underwriters), and then
only in such quantity as the underwriters determine in their sole and reasonable discretion will
not materially jeopardize the success of the offering by the Company, and the Holder enters into
such lock-up agreements as may be reasonably required of other selling shareholders in such
Registration Statement. If the total amount of securities, including Registrable Shares, requested
by shareholders to be included in such offering exceeds the amount of securities sold other than by
the Company that the underwriters determine in their sole and reasonable discretion is compatible
with the success of the offering, then the Company shall be required to include in the offering
only that number of such securities, including Registrable Shares, which the underwriters determine
in their sole and reasonable discretion will not materially jeopardize the success of the offering
(the securities so included to be apportioned pro rata among the selling shareholders according to
the total amount of securities entitled to be included therein owned by each selling shareholder or
in such other proportions as shall mutually be agreed to by such selling shareholders). For
purposes of the preceding parenthetical concerning apportionment, for any selling shareholder who
is a holder of Registrable Shares and is a partnership or corporation, the partners, retired
partners and shareholders of such holder, or the estates and family members of any such partners
and retired partners and any trusts for the benefit of any of the foregoing persons shall be deemed
to be a single “selling shareholder”, and any pro-rata reduction with respect to such “selling
shareholder” shall be based upon the aggregate amount of shares carrying registration rights owned
by all entities and individuals included in such “selling shareholder”, as defined in this
sentence.



          9.6 Indemnification. In the event that any Registrable Shares are included in a
Registration Statement under this Section 9.



          (i) To the extent permitted by law, the Company will promptly indemnify and hold harmless the
Holder, any underwriter (as defined in the Securities Act) for the Holder and each person, if any,
who controls the Holder or underwriter within the meaning of the Securities Act or the Exchange
Act, against any losses, claims, damages, or liabilities (joint or several) to which they may
become subject under the Securities Act, or the Exchange Act, insofar as such losses, claims,
damages, or liabilities (or actions in respect thereof) arise out of or are based upon any of the
following statements, omissions or violations (collectively a “Violation”): (i) any untrue
statement or alleged untrue statement of a material fact contained in such Registration Statement,
including any preliminary prospectus or final prospectus contained therein or any
amendments or supplements thereto, (ii) the omission or alleged omission to state therein a
material fact required to be stated therein, or necessary to make the statements therein not
misleading, or (iii) any violation or alleged violation by the Company of the Securities Act, the
Exchange Act, or any rule or regulation promulgated under the Securities Act, or the Exchange Act,
and the Company will pay to the Holder, underwriter or controlling person, as incurred, any legal
or other expenses reasonably incurred by them in connection with investigating or defending any
such loss, claim, damage, liability, or action; provided, however, that the indemnity agreement
contained in this Section 9.6(i) shall not apply to amounts paid in settlement of any such loss,
claim, damage, liability, or action if such settlement is effected without the consent of the
Company (which consent shall not be unreasonably withheld), nor shall the Company be liable in any
such case for any such loss, claim, damage, liability, or action to the extent that it arises out
of or is based upon a Violation which occurs in reliance upon and in conformity with written
information furnished expressly for use in connection with such registration by the Holder,
underwriter or controlling person.



12









 





          (ii) To the extent permitted by law, the Holder will indemnify and hold harmless the Company,
its directors, officers, and each person, if any, who controls the Company within the meaning of
the Securities Act or the Exchange Act, any underwriter, any other holder selling securities in
such Registration Statement and any controlling person of any such underwriter or other holder,
against any losses, claims, damages, or liabilities (joint or several) to which any of the
foregoing persons may become subject, under the Securities Act, or the Exchange Act, insofar as
such losses, claims, damages, or liabilities (or actions in respect thereto) arise out of or are
based upon any Violation, in each case to the extent (and only to the extent) that such Violation
occurs in reliance upon and in conformity with written information furnished by the Holder
expressly for use in connection with such registration; and the Holder will pay, as incurred, any
legal or other expenses reasonably incurred by any person intended to be indemnified pursuant to
this Section 9.6(ii), in connection with investigating or defending any such loss, claim, damage,
liability, or action; provided, however, that the indemnity agreement contained in
this Section 9.6(ii) shall not apply to amounts paid in settlement of any such loss, claim, damage,
liability or action if such settlement is effected without the consent of the Holder, which consent
shall not be unreasonably withheld; provided, further, that, in no event shall any
indemnity under this Section 9.6(ii) exceed 20% of the cash value of the gross proceeds from the
offering received by the Holder.



          (iii) Promptly after receipt by an indemnified party under this Section 9.6 of notice of the
commencement of any action (including any governmental action), such indemnified party shall, if a
claim in respect thereof is to be made against any indemnifying party under this Section 9.6,
deliver to the indemnifying party a written notice of the commencement thereof and the indemnifying
party shall have the right to participate in, and, to the extent the indemnifying party so desires,
jointly with any other indemnifying party similarly notified, to assume the defense thereof with
counsel selected by the indemnifying party and approved by the indemnified party (whose approval
shall not be unreasonably withheld); provided, however, that an indemnified party (together with
all other indemnified parties which may be represented without conflict by one counsel) shall have
the right to retain one separate counsel, with the fees and expenses to be paid by the indemnifying
party, if representation of
such indemnified party by the counsel retained by the indemnifying party would be inappropriate due
to actual or potential differing interests between such indemnified party and any other party
represented by such counsel in such proceeding. The failure to deliver written notice to the
indemnifying party within a reasonable time of the commencement of any such action, if prejudicial
to its ability to defend such action, shall relieve such indemnifying party of any liability to the
indemnified party under this Section 9.6, but the omission so to deliver written notice to the
indemnifying party will not relieve it of any liability that it may have to any indemnified party
otherwise than under this Section 9.6.



13









 





          (iv) If the indemnification provided for in this Section 9.6 is held by a court of competent
jurisdiction to be unavailable to an indemnified party with respect to any loss, liability, claim,
damage, or expense referred to therein, then the indemnifying party, in lieu of indemnifying such
indemnified party hereunder, shall contribute to the amount paid or payable by such indemnified
party as a result of such loss, liability, claim, damage, or expense in such proportion as is
appropriate to reflect the relative fault of the indemnifying party on the one hand and of the
indemnified party on the other in connection with the statements or omissions that resulted in such
loss, liability, claim, damage, or expense as well as any other relevant equitable considerations.
The relative fault of the indemnifying party and of the indemnified party shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement of a material fact
or the alleged omission to state a material fact relates to information supplied by the
indemnifying party or by the indemnified party and the parties’ relative intent, knowledge, access
to information, and opportunity to correct or prevent such statement or omission.



          (v) Notwithstanding the foregoing, to the extent that the provisions on indemnification and
contribution contained in the underwriting agreement entered into in connection with the
underwritten public offering are in conflict with the foregoing provisions, the provisions in the
underwriting agreement shall control.



          (vi) The obligations of the Company and the Holder under this Section 9.6 shall survive the
completion of any offering of Registrable Shares in a Registration Statement under this Section 9,
and otherwise.



          9.7. Reports Under Securities Exchange Act of 1934. With a view to making available
to the Holder the benefits of Rule 144 under the Securities Act (“Rule 144”) and any other
rule or regulation of the SEC that may at any time permit the Holder to sell shares of the
Company’s Common Stock to the public without registration, commencing immediately after the date on
which a registration statement filed by the Company under the Securities Act becomes effective, the
Company agrees to use its best efforts to:



          (i) make and keep public information available, as those terms are understood and defined in
Rule 144;



          (ii) file with the SEC in a timely manner all reports and other documents required of the
Company under the Securities Act and the Exchange Act; and



          (iii) furnish to the Holder, so long as the Holder owns any Registrable Shares, forthwith upon
request (i) a copy of the most recent annual or quarterly report of the Company and such other
reports and documents so filed by the Company, and (ii) such other information as may be reasonably
requested in availing any Holder of any rule or regulation of the SEC which permits the selling of
any such securities without registration or pursuant to such form.



14









 





          9.8. Permitted Transferees. The rights to cause the Company to register Registrable
Shares granted to the Holder by the Company under this Section 9 may be assigned in full by a
Holder in connection with a transfer by the Holder of its Registrable Shares if: (a) the Holder
gives prior written notice to the Company; (b) such transferee agrees to comply with and be bound
by the terms and provisions of this Agreement; (c) such transfer is otherwise in compliance with
this Agreement and (d) such transfer is otherwise effected in accordance with applicable securities
laws. Except as specifically permitted by this Section 9.8, the rights of a Holder with respect to
Registrable Shares as set out herein shall not be transferable to any other person, and any
attempted transfer shall cause all rights of the Holder therein to be forfeited.



          9.9 Termination of Registration Rights. The Holder shall no longer be entitled to
exercise any registration rights provided for in Section 9.1 after such time at which all
Registrable Shares held by the Holder can be sold in any three-month period without registration in
compliance with Rule 144(k) of the Securities Act.



     10. Notices. All notices required hereunder shall be in writing and shall be deemed
given when telegraphed, delivered personally or within two (2) days after mailing when mailed by
certified or registered mail, return receipt requested, to the Company at its principal office, or
to the Holder at the address set forth on the record books of the Company or at such other address
of which the Company or the Holder has been advised by notice hereunder. A copy of any notices
provided to the Company hereunder shall be concurrently provided to the Company’s legal counsel
addressed to Hunton & Williams, LLP, Attn: David E. Wells, Esq., 1111 Brickell Avenue, Suite 2500,
Miami, Florida 33131.



     11. Applicable Law. The Warrant is issued under and shall for all purposes be governed
by and construed in accordance with the laws of the State of Florida, without giving effect to the
choice of law rules thereof.



     12. Modification of the Terms. This Warrant and any term hereof may be changed,
waived, discharged or terminated only by an instrument in writing signed by the Holder and the
Company.



     13. Venue. The parties irrevocably submit to the exclusive jurisdiction of the courts
of State of Florida located in Broward County and federal courts of the United States for the
Southern District of Florida in respect of the interpretation and of the provisions of this
Agreement and in respect of the transactions contemplated hereby.



     14 Waiver of Jury Trial. THE COMPANY AND THE HOLDER HEREBY WAIVE
THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING BASED UPON, OR RELATED TO,
THE SUBJECT MATTER OF THIS AGREEMENT. THIS WAIVER IS KNOWINGLY, INTENTIONALLY AND VOLUNTARILY MADE
BY THE HOLDER AND THE COMPANY.



15









 





     15. Payment of Certain Taxes and Charges. The Company shall not be required to issue
or deliver any certificate for shares of Common Stock or other securities upon the exercise of this
Warrant or to register any transfer of this Warrant until any applicable transfer tax and any other
taxes or governmental charges that the Company may be required by law to collect in respect of such
exercise or transfer shall have been paid, such tax being payable by Holder at the time of
surrender for the exercise or transfer.



     16. Register. The Company or its stock transfer agent, if any, will maintain a
register containing the name and address of the Holder of this Warrant and of the holders of other
warrants of like tenor issued simultaneously hereunder. Any Holder may change its, his or her
address as shown on the warrant register by written notice to the Company requesting such change.
The Company may treat the Holder of this Warrant as the absolute owner hereof for all purposes and
shall not be bound to recognize any equitable or other claim to or interest in this Warrant on the
part of any other person.



     17. Specific Performance. The parties hereto acknowledge and agree that irreparable
damage would occur in the event that any of the provisions of this Warrant were not performed in
accordance with their specific terms or were otherwise breached. Accordingly, it is agreed that
they shall be entitled to an injunction or injunctions to prevent breaches of the provisions of
this Warrant and to enforce specifically the terms and provisions hereof in any court of competent
jurisdiction in the United States or any state thereof, in addition to any other remedy to which
they may be entitled at law or equity.



16









 





     IN WITNESS WHEREOF, the Company has caused this Warrant to be signed on its behalf, in its
corporate name, by its duly authorized officer, all as of the day and year first above written.



	 	 	 	 	 
	 	BIOHEART, INC.



 	 
	 	By:  	/s/
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 




17









 





EXHIBIT A




WARRANT EXERCISE FORM




To: Bioheart, Inc.




ELECTION TO EXERCISE




     The undersigned hereby exercises its rights to purchase _________ shares of the Subject
Shares covered by the within Warrant and tenders payment herewith in the amount of $____________
in accordance with the terms thereof, and requests that certificates for such securities be issued
in the name of, and delivered to:


 



 



 



(Print Name, Address and Social Security
or Tax Identification Number)



and, if such number of shares shall not be all the Subject Shares covered by the within Warrant,
that a new Warrant for the balance of the Subject Shares covered by the within Warrant be
registered in the name of, and delivered to, the undersigned at the address stated below.




	 	 	 	 	 	 	 	 	 
	Dated:

	 	 	 	 	 	Name	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	(Print)
	 
	 	 	 	 	 	 	 	 
	Address:
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	(Signature)






 









 





To: Bioheart, Inc.



NOTICE OF CASHLESS EXERCISE




(To be executed upon exercise of Warrant

pursuant to Section 1(e)




     The undersigned hereby irrevocably elects to exchange its Warrant for _____________ shares of
the Subject Shares pursuant to the cashless exercise provisions of the within Warrant, as provided
for in Section 1(e) of such Warrant, and requests that a certificate or certificates for the shares
be issued in the name of and delivered to:


 



 



 



(Print Name, Address and Social Security
or Tax Identification Number)



and, if such number of shares shall not be all the Subject Shares which the undersigned is entitled
to purchase in accordance with the within Warrant, that a new Warrant for the balance of the
Subject Shares covered by the within Warrant be registered in the name of, and delivered to, the
undersigned at the address stated below.






	 	 	 	 	 	 	 	 	 
	Dated:

	 	 	 	 	 	Name	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	(Print)
	 
	 	 	 	 	 	 	 	 
	Address:
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	(Signature)








	 	 	 
	 

	 	(Signature must conform in all respects
to the name of the Holder as specified on
the face of the Warrant)







 









 





Exhibit B




STOCKHOLDER AGREEMENT




BIOHEART, INC.




     STOCKHOLDER AGREEMENT (the “Agreement”), by and among BIOHEART, INC., a Florida
corporation (“Bioheart” or the “Company”), HOWARD J. LEONHARDT (“HJL”), and
the undersigned Stockholder of Bioheart (the “Stockholder”), effective as of the date of
Bioheart’s signature below (the “Effective Date”).



RECITALS




     WHEREAS, HJL is the founder and Chief Executive Officer of Bioheart and, as of the date
hereof, HJL owns a significant number of Bioheart’s outstanding shares of common stock, par value
$.001 per share (the “Common Stock”);



     WHEREAS, the Stockholder understands and acknowledges that this Agreement is a material
inducement to, and in consideration for, the shares of Common Stock to be issued and sold to the
Stockholder pursuant to the Investment and Subscription Agreement between the Company and the
Stockholder of even date herewith (the “Subscription Agreement”); and



     WHEREAS, the parties hereto desire to provide for the agreements contained herein, including
without limitation those regarding restrictions on transfers of Common Stock and various other
matters, and to provide for certain rights and obligations of the parties in respect thereof, all
as hereinafter provided.



     NOW, THEREFORE, in consideration of the premises and of the terms and conditions contained
herein, the parties hereto agree, intending to be legally bound, as follows:



DEFINITIONS




     1. As used herein, the term “Affiliate” means, with respect to any Person, any other
Persons controlled by, controlling or under common control with such Person.



     2. As used herein, the term “Excluded Stock” means (i) the Reserved Options Shares
(including issuance, award or grant thereof, the exercise thereof and or the vesting of or lapsing
of restrictions thereto), (ii) securities issuable as a stock dividend or upon any subdivision of
shares of Common Stock, provided that the securities issued pursuant to such stock dividend or
subdivision are limited to additional shares of Common Stock, (iii) securities issuable pursuant to
or otherwise sold in an Initial Public Offering or subsequent registered public offering, (iv) debt
securities with no equity capital stock, or conversion to equity capital stock, provision, feature
or right, (v) securities issued in connection with any loan or any equipment financing or leases
(including securities issued in consideration of guarantees of such financing or leases) which are
approved by the Company’s Board of Directors, provided that such securities are issued to one or
more of the following or to affiliates of such persons: (a) any commercial lender or financial
institution providing financing for such transaction, or (b) the party providing the equipment or
lease, (vi) shares of Common Stock, or other securities (whether equity or debt, convertible or
not, or otherwise) of the Company (or any subsidiary of the Company), issued in connection with
acquisitions or strategic ventures, arrangements or alliances, and/or to vendors, customers,
co-venturers or other persons in similar commercial or corporate partnering situations, in each
case, where such issuance is approved by the Company’s Board of Directors and provided that such
securities are issued to the seller in the case of an acquisition or to the parties constituting
the strategic venture, arrangement or alliances,



1









 







or to the vendors, customers, co-venturer or other persons in similar commercial corporate
partnering situations, as the case may be, or to affiliates of such persons, and (vii) any
securities issued pursuant to a “poison pill” rights plan adopted by the Company.



     3 As used herein , the terms “Initial Public Offering” or “IPO” means the
Company’s initial underwritten public offering of shares of Common Stock or other securities
pursuant to a registration statement under the Securities Act of 1933, as amended, and the rules
and regulations promulgated thereunder (the “Securities Act”). The parties acknowledge and
agree that although the Company may attempt to conduct one or more public offerings of Common Stock
in the future, the decision to proceed with any public offering shall be made solely by the
Company’s Board of Directors, the Company has no obligation to conduct any public offering, and
there can be no assurance that a public offering will ever be attempted or consummated.



     4. As used herein, the term “Person” means an individual, corporation, partnership,
joint venture, trust, unincorporated organization, government (or any department or agency thereof)
or other entity.



     5. As used herein, the term “Reserved Option Shares” means shares of Common Stock
awarded, issued or issuable, or options, warrants or rights to purchase such shares of Common Stock
granted or grantable from time to time, to directors, officers or employees of, or consultants to,
the Company pursuant to any restricted stock, stock purchase or option plan (or other similar
equity-based compensation plan, scheme or arrangement), where such plan has been authorized, or
such award, issuance or grant has been approved by the Company’s Board of Directors (or by a
properly authorized committee of the Board).



ARTICLE
I




     Section 1.1 Reconciliation with Prior Stockholders Agreements. Notwithstanding
anything to the contrary in this Agreement, if the undersigned Stockholder is a party to any of the
Prior Stockholders Agreements, it is hereby agreed that the provisions of this Agreement (and the
rights and obligations hereunder) shall be limited, modified and/or interpreted as and to the
extent necessary to resolve any conflict between the terms of this Agreement and such Prior
Stockholders Agreement; it being agreed that any such limitation, modification or interpretation of
the terms hereof and the determination of the existence of any such conflict shall be determined
solely by the Company’s Board of Directors or Chief Executive Officer in good faith.



     Section 1.2 No Conflicting Agreements. The Stockholder shall not enter into any
stockholder agreement or other agreements or arrangements of any kind with any Person with respect
to the Common Stock or the Company that is inconsistent with, or that limits in any way the
effectiveness or implementation of, the provisions of this Agreement, and the Stockholder
represents and warrants to Bioheart that the Stockholder is not party to any such prohibited
agreement or arrangement as of the time of this Agreement (other than, if applicable, a Prior
Stockholders Agreement to which Section 1.1 hereof relates). The foregoing prohibition includes,
but is not limited to, agreements or arrangements with respect to the acquisition or disposition of
shares of Common Stock which is inconsistent with the provisions of this Agreement.



2









 






ARTICLE II




RESTRICTIONS ON TRANSFERS OF STOCK




     Section 2.1 General Provisions on Transfers



          (a) Prohibition on Transfers Generally. The Stockholder shall not at any time,
directly or indirectly, sell, assign, gift, pledge, encumber or otherwise transfer any shares of
Common Stock or any interest in or with respect to such shares (any such transaction, whether or
not for consideration, or voluntary or involuntary, being referred to hereinafter as a
“Transfer” and all Persons to whom a Transfer is made, regardless of the method of
Transfer, shall be referred to collectively as “Transferees” and individually as a
“Transferee”), unless such Transfer (A) is permitted under and made in accordance with
Sections 2.3, 2.4, 2.5 or 2.6 hereof, or (B) is a Transfer to (i) Bioheart following Bioheart’s
agreement to accept such Transfer, (ii) to HJL following HJL’s agreement to accept such Transfer,
or (iii) to any other Person if in the case of this clause (iii) the proposed Transfer is
expressly permitted by HJL in his discretion in writing (any such permitted transfer under this
clause B is a “Section 2.1 Transfer”).




          (b) Recordation. Bioheart (or its transfer agent, if any) shall not be required to
record upon its official stock books or records any Transfer of shares of Common Stock held or
owned by the Stockholder or any other Person to any other Person or purported Transferee except
Transfers in accordance with this Agreement.




          (c) Obligations of Transferees. No Transfer of shares of Common Stock by the
Stockholder shall be permitted or effective unless the Transferee shall have executed an
appropriate agreement and documents in form and substance satisfactory to Bioheart in its
reasonable judgment confirming (i) that the Transferee takes such shares subject to all the terms
and conditions of this Agreement and the Transferee agrees to be a party to this Agreement as a
“Stockholder” hereunder and to comply with the obligations of a “Stockholder” under this Agreement
and (ii) the transferee’s investment representations to Bioheart and related matters providing
reasonable assurances that the transfer does not violate securities laws or this Agreement; except
that the requirements of this paragraph (c) shall not apply to acquisitions of Common Stock by the
Company or HJL and may be waived in whole or in part at the election of HJL in connection with
Transfers under Sections 2.5 or 2.6 or a Transfer under clause B(iii) of Section 2.1(a).




     Section 2.2 Compliance with Securities Laws



     In addition to any other requirements of this Agreement, the Stockholder shall not Transfer
any shares of Common Stock at any time, unless (a) the Transfer is pursuant to an effective
registration statement under the Securities Act and in compliance with any other applicable federal
securities laws and state securities or “blue sky” laws or (b) such Stockholder shall have
furnished Bioheart with an opinion of counsel, which opinion and counsel shall be satisfactory to
Bioheart in its reasonable judgment, to the effect that no such registration is required because of
the availability of an exemption from registration under the Securities Act and under any
applicable state securities or “blue sky” laws.



     Section 2.3 Permitted Transfers



          Section 2.3.1 Affiliate Transfers. The restrictions contained in Section 2.1(a)
shall not apply to any Transfer of 100% of the Common Stock owned by the Stockholder to an
Affiliate of the Stockholder that is not an individual. Any such Transferee must, as a condition
to Transfer, agree to be bound by this Agreement as a Stockholder hereunder. In the event that any
one or more parties other than the Person who is the Stockholder on the date of this Agreement (the
“Original Stockholder”) becomes

3









 








party to this Agreement (or counterpart to this Agreement) as the Stockholder hereunder, such
parties shall have no rights under this Section 2.3.1. Notwithstanding the foregoing, no such
Transfer may be affected under this Section 2.3.1 unless Bioheart is satisfied, in its reasonable
discretion that the proposed Transferee is an Accredited Investor.




          Section 2.3.2 Transfers to Another Stockholder. The restrictions contained in Section
2.1(a) shall not apply to any Transfer by the Stockholder to any one of the other stockholders of
Bioheart if the Transfer occurs more than 18 months after the time when the shares to be
transferred were acquired by the transferring Stockholder; provided, however, that no more than one
Transfer may be made by the Stockholder under this Section 2.3.2 in any 90-day period.
Notwithstanding the foregoing, no such Transfer may be affected unless Bioheart is satisfied, in
its reasonable discretion that the proposed Transferee is an Accredited Investor.




     Section 2.4 Transfers to Third Parties; Rights of First Offer After 3 Years or Upon
Improper Transfer.



          Section 2.4.1 (a) Notice of Right of First Offer. From and after the third annual
anniversary of the date of this Agreement, if the Stockholder (for purposes of this section, the
“Selling Stockholder”) desires to make a bona fide offer and sale of any of its Common
Stock to a third party (a “Proposed Transferee”) (other than a Section 2.1 Transfer or a
Transfer pursuant to Section 2.3, 2.5 or 2.6), then the Selling Stockholder shall cause
such offer to be reduced to writing and the Selling Stockholder shall deliver a Notice of Right
of First Offer to the Company and HJL containing the following information:




     (i) the number of shares of Common Stock proposed to be so transferred (the “Offered
Stock”) (it being agreed that the Offered Stock must constitute the entire legal and beneficial
interest in whole shares of Stock, and not any lesser rights or interests therein or any fractional
shares);



     (ii) the terms and conditions of the proposed transfer (the “Offered Terms”), which terms
shall include (A) the price per share at which the Selling Stockholder desires to sell the Offered
Stock, and the timing of such payment (which price shall be payable only in cash, unless the
Company permits other consideration to be paid, which consideration shall be valued as determined
by the Company’s board of directors) and (B) the identity (if known or then contemplated) of the
proposed or potential transferee(s) of the Offered Stock (i.e., name, occupation and address); and



     (iii) an irrevocable affirmative offer made by the Selling Stockholder to transfer the Offered
Stock to the Company and/or HJL in accordance with this Stockholder Agreement, at a price (the
“Offer Price”) equal to the cash portion of the price included in the Offered Terms plus
additional cash equal to the fair market value (as determined by the Company’s Board of Directors)
of any non-cash consideration included in the Offered Terms as indicated in the Notice of Right of
First Offer (i.e., the number of shares of Offered Stock multiplied by the per share
price).



     The date that the Notice of Right of First Offer is first received by the Company shall
constitute the “First Offer Notice Date”.



          (b) Right of First Offer to the Company. The Company shall have the exclusive,
unconditional and irrevocable option to purchase and acquire from the Selling Stockholder all or
any portion of the Offered Stock in its discretion, in accordance with the provisions of the Notice
of Right of First Offer (other than the purchase price, which shall be payable in cash), for a
period of thirty (30) days from the First Offer Notice Date, in accordance with the procedure
described in this Section 2.4.1. The Selling Stockholder hereby irrevocably and
unconditionally agrees to sell, transfer and convey

4









 








the Offered Stock, and all of such stockholder’s right, title and interest in and to such
stock, on the terms and conditions set forth in this Section 2.4.1 (including this
subsection (b)). The Company will be entitled to give written notice (the “Company Exercise
Notice”) to the Selling Stockholder and to HJL, within thirty (30) business days from the First
Offer Notice Date, of such party’s election to acquire all or any portion of the Offered Stock.
The Company Exercise Notice shall refer to the Notice of Right of First Offer and shall set forth
the number of shares of Offered Stock sought to be acquired by the Company pursuant to the exercise
of its first offer rights hereunder.




          (c) Second Priority Right of First Offer to HJL. In the event that the Company shall
either (x) fail to deliver the Company Exercise Notice, properly and on a timely basis, as required
in Section 2.4.1(b) hereof, or (y) deliver the Company Exercise Notice but shall elect to
purchase less than all of the shares of Offered Stock, then HLJ shall have the exclusive,
unconditional and irrevocable option to purchase and acquire the Remaining Offered Stock, in whole
but not in part, in accordance with the provisions of the Notice of Right of First Offer (other
than the purchase price, which shall be payable in cash), for a period of thirty (30) days from the
First Offer Notice Date, in accordance with the procedure described in this Section 2.4.1.
As used herein, the term “Remaining Offered Stock” shall mean, in the case of the event
described in clause (x) of the immediately preceding sentence, all Offered Stock, and, in the case
of the event described in clause (y) of the immediately preceding sentence, all shares of Offered
Stock other than those shares with respect to which the Company exercised its right to purchase in
the Company Exercise Notice). HJL will be entitled to give written notice (the “HJL Exercise
Notice” and, generally, together with the Company Exercise Notice, the “Exercise
Notice”) to the Selling Stockholder and the Company, within thirty (30) days from the First
Offer Notice Date, of HJL’s election to acquire all of the Remaining Offered Stock in accordance
with this Section 2.4.1(c). The HJL Exercise Notice shall refer to the Notice of Right of
First Offer and shall set forth the number of shares of Remaining Offered Stock to be acquired by
HJL pursuant to the exercise of its first offer rights hereunder.




          (d) Requirement to Purchase All Offered Stock. Notwithstanding the provisions of the
preceding subsections 2.4.1(b) and 2.4.1(c), the option to purchase Common Stock described in the
Notice of Right of First Offer may be exercised and the Closing (as hereinafter defined) on such
purchase consummated only if HJL and/or the Company, alone or collectively, agree to purchase all
of the Offered Stock pursuant to one or both of their respective Exercise Notices.




          (e) Closing and Tender Requirements. The consummation of any transfer to the Company
or HJL required to be effected pursuant to this Section 2.4.1 shall constitute the
“Closing”, and the time and date of such Closing shall constitute the “Closing
Date”. The Closing shall be held at the principal office of the Company, at 10:00 a.m. on the
fortieth (40th) day subsequent to the First Offer Notice Date (or such other date, time or place as
mutually agreed upon by the parties to the transaction); subject, in any case, to extension until
expiration or termination of any applicable regulatory waiting periods (including, without
limitation, if applicable, pursuant to the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended) and satisfaction of all other applicable regulatory conditions. At the Closing, the
Selling Stockholder shall present to the purchaser(s) (the Company and/or HJL, as the case may be)
all certificates for the Offered Stock required to be sold in such transaction, in proper form for
transfer, including signed endorsements or stock powers. The Offered Stock shall be transferred
free and clear of all liens, security interests and encumbrances or adverse claims of any kind or
character. At the Closing, the purchaser(s), upon receipt of proper tender of the Offered Stock,
shall tender full payment of the Offer Price in conformity with the Offered Terms as set forth in
the Notice of Right of First Offer. In addition, if the Person selling Common Stock is the
personal representative of a deceased Stockholder, the personal representative shall also deliver
to the purchaser or purchasers (i) copies of letters testamentary or letters of administration
evidencing his appointment and qualification, (ii) a certificate issued by the Internal Revenue
Service pursuant to Section 6325 of Internal Revenue Code of

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1986, as amended (the “Code”), discharging the shares being sold from liens imposed by
the Code (or, if it is impossible to obtain such certificate by the Closing Date, the sale of such
Common Stock may be consummated and the proceeds placed in escrow pending receipt thereof) and
(iii) an estate tax waiver issued by the state of the decedent’s domicile.




          (f) Permitted Transfer Following Expiration or Non-Exercise of Right(s) of First
Offer. If the Company and HJL shall either (x) elect in writing not to exercise their Rights
of First Offer under this Section 2.4 or (y) fail to deliver the Company Exercise Notice and/or the
HJL Exercise Notice in satisfaction of paragraph (d) of this Section 2.4 within thirty (30) days
after the First Offer Notice Date and in accordance with this Section 2.4, then all (and not less
than all) of the Offered Stock may be sold by the Selling Stockholder, at any time during the
ensuing sixty (60) days, at a price not less than the purchase price contained in the Offered Terms
(as determined in accordance with paragraph (a) of this Section 2.4.1) and on material terms no
more favorable in the aggregate to the purchaser than the Offered Terms as set forth in the Notice
of Right of First Offer; provided, however, that the purchaser of such Stock, as a condition to the
effectiveness of such transfer, must first execute a written acknowledgment and agreement, in form
and substance reasonable satisfactory to the Company, that such purchaser is an Accredited Investor
and has become a Stockholder and is a party to this Stockholder Agreement and that such purchaser
agrees to be bound by the terms, restrictions, provisions and conditions set forth in this
Stockholder Agreement (as such may be amended from time to time).




          Section 2.4.2 Improper Transfers; Right of First Offer Upon Improper Transfer. Absent
the right to effect a Transfer of Common Stock pursuant to a Section 2.1 Transfer or a Transfer
pursuant to Sections 2.3, 2.4, 2.5 or 2.6 hereof, any Transfer or purported Transfer of
Common Stock by the Stockholder at any time during the term of this Stockholder Agreement, whether
voluntary or involuntary, which is not in compliance with the terms and provisions of this Article
2, as determined in good faith by the Company’s Board of Directors (hereinafter, an “Improper
Transfer”) shall be invalid, null, void and of no force or effect, and shall not be effected or
permitted on the stock books and records of the Company, which constitute the definitive records
regarding the issuance and transfer of Common Stock. In furtherance and not in limitation of the
foregoing, promptly upon discovery of any such Improper Transfer or attempted Improper Transfer,
the Company may in its discretion issue a Notice of Right of First Offer (with the date of such
issue being deemed to be the “First Offer Notice Date” therefore) (hereinafter, the
“Corporate Notice of Rights”), a copy of which shall be sent to the person attempting or
purporting to make such Improper Transfer (the “Improper Transferor”) and to his or her
intended transferee. The Improper Transferor shall comply with any requests for information that
the Company shall make regarding such Improper Transfer. Upon the giving of the Corporate Notice
of Rights, the time periods for the exercise of the Company’s and HJL’s purchase options specified
in Section 2.4.1 (treating such Corporate Notice of Rights as if it were a “Notice of Right
of First Offer” under Section 2.4.1) shall commence running, and the Company and HJL shall have
such rights to purchase the shares subject to the Improper Transfer as provided in Section
2.4.1 above with respect thereto. The rights of the Company under this Section 2.4.2
shall be in addition to any rights, at law or in equity, which the Company may have in connection
with any Improper Transfer. Notwithstanding any other provision of this Agreement, and whether or
not the Company elects to give a Corporate Notice of Rights in connection with an Improper
Transfer, the Company in its discretion may void and terminate any recordation of the Improper
Transfer and may unilaterally cancel any stock certificates that may have been issued reflecting
such Improper Transfer.




     Section 2.5 Tag-Along Rights for Stockholder



          Section 2.5.1 Tag-Along Notice. In the event that HJL proposes to sell all or a
portion of the shares of Common Stock owned by him constituting twenty percent (20%) or more of the
Company’s outstanding shares of Common Stock held by him on the date hereof (such shares to be
sold,

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the “HJL Shares”) and such sale is proposed to occur prior to the Company’s IPO (a
“Covered Transaction”), then HJL shall give written notice (the “Tag-Along Notice”)
to the Stockholder prior to consummating such sale, stating HJL’s bona fide intention to make such
sale, referring to this Section 2.5, specifying the number of shares of Common Stock proposed to be
sold and specifying the bona fide per share price (the “Tag-Along Price”), and the material
terms pursuant to which such sale is proposed to be made (together with the Tag-Along Price, the
“Tag-Along Terms”), and specifying the name, address, and relationship, if any, to HJL of
the proposed purchaser or transferee. Upon the request of the Stockholder, HJL shall promptly
furnish such information as may be reasonably requested (to the extent such information is known to
HJL) to establish that the offer and proposed transferee are bona fide. Notwithstanding the
foregoing, the provisions of this Section 2.5 shall not apply to (i) a transfer by HJL to any
Affiliate of HJL that agrees to be bound by the terms of this Agreement as a Stockholder hereunder
or (ii) a transfer of Common Stock pursuant to a registration statement filed with the Securities
and Exchange Commission.




          Section 2.5.2 Exercise of Tag-Along Option.




               (a) Option. The Stockholder shall have the option until the 15th day (the “Option
Date”) following the date of the Tag-Along Notice to elect to participate in the Covered
Transaction by selling a number of shares (the “Tag-Along Shares”) of Common Stock held by
Stockholder equal to the product of (1) the quotient of (A) the aggregate number of shares of
Common Stock proposed to be sold by HJL in the Covered Transaction divided by (B) the aggregate
number of shares of Common Stock then owned by HJL, multiplied by (2) the number of shares
of Common Stock then owned by the Stockholder, for the same Tag-Along Price and otherwise on the
same Tag-Along Terms; provided, that in the event that the purchase price for the Common Stock to
be sold by HJL consists in whole or in part of securities that are not issued in a transaction
registered under the Securities Act, then the Stockholder shall not be entitled to any rights to
sell Tag-Along Shares under this Section 2.5 unless the Stockholder is then an “Accredited
Investor” (as defined in Rule 501 promulgated under the Securities Act) and Stockholder certifies
in writing to Bioheart in form reasonable satisfactory to Bioheart that Stockholder is an
“Accredited Investor”.




               (b) Failure to Exercise Option. If the Stockholder does not timely exercise its
option to sell shares of Common Stock in the Covered Transaction by delivering written notice of
such exercise (the “Exercise Notice”) to each of HJL and the Company prior to the Option
Date, then HJL shall be free, for a period of 90 days following the Option Date, to sell the HJL
Shares (or any portion of the HJL Shares that the proposed purchaser desires to purchase) to the
proposed transferee, as long as all of the HJL Shares to be sold are sold on material terms no more
favorable in the aggregate to the purchaser than the Tag-Along Terms; in which event the
Stockholder shall not have any rights to participate in such sale under this Section 2.5.




               (c) Sale Agreement. If the Stockholder timely elects to sell Tag-Along Shares by
delivering his Exercise Notice to each of HJL and the Company on or prior to the Option Date, then
the Stockholder shall and does hereby agree to cooperate in consummating such a sale, including,
without limitation, by becoming a party to the sales agreement for the Covered Transaction with
respect to the Tag-Along Shares (or portion thereof) to be sold by the Stockholder, delivering at
the consummation of such sale, stock certificates and other instruments for such Common Stock duly
endorsed for transfer, free and clear of all liens and encumbrances, and voting or consenting in
favor of such transaction (to the extent a vote or consent is required) and taking any other
necessary or appropriate action in furtherance thereof, including the execution and delivery of any
other appropriate agreements, certificates, instruments and other documents. In connection with
such sale, the Stockholder may be required to make representations and indemnities to the buyer
solely and in customary form with respect

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to the Stockholder and the Stockholder’s ownership of, and his authority and rights to sell,
his Tag-Along Shares and shall have no obligation with respect to transaction expenses of or on
behalf of HJL.




               (d) Limitations on Tag-A-Long Rights. Notwithstanding any other provision contained
in this Agreement, there shall be no liability on the part of Bioheart or HJL to the Stockholder in
the event that a Covered Transaction subject to this Section 2.5 is not consummated in full or at
all for any reason whatsoever. The decision whether to propose or to consummate a Covered
Transaction subject to this Section 2.5 shall be in the sole and absolute discretion of HJL. The
Stockholder acknowledges that any proposed buyer in the Covered Transaction may choose not to
consummate such transaction in whole or in part for any reason, including as a result of the terms
of this Agreement or in the event that the Stockholder or any other party to the proposed
transaction does not agree to the terms of such sale requested by the buyer. Stockholder also
understands and agrees that a buyer may choose to purchase less than all of the shares proposed to
be sold by HJL and the Stockholder (and any other Bioheart stockholders having applicable
“tag-a-long” rights) in a Covered Transaction, in which case the number of Tag-Along Shares to be
sold by the Stockholder shall be proportionately reduced.




     Section 2.6 Drag-Along Right of HJL



          Section 2.6.1 Exercise. If HJL, by himself or together with any one or more of his
Affiliates and/or family members or trusts for the benefit of him and/or his family (HJL and such
other sellers are referred to below as the “HJL Sellers”) propose to make a bona fide sale
of shares constituting an aggregate of one-third (33 and 1/3 percent) or more of the Company’s
outstanding shares of Common Stock to any proposed transferee not Affiliated with any of the HJL
Sellers with respect to which a favorable opinion of a third party investment bank or valuation
firm has been obtained by Bioheart with respect to the fairness, from a financial point of view, of
the proposed transaction to the stockholders of Bioheart other than the HJL Sellers (the “Other
Stockholders,” including the Stockholder party hereto), then HJL shall have the right (a
“Drag-Along Right”), exercisable upon not less than 30 days’ prior written notice to the
Stockholder (“Drag Notice”), to require the Stockholder to sell, and the Stockholder shall
thereupon be required to sell, to the proposed transferee a number of shares (the “Drag-Along
Shares”) of Common Stock held by the Stockholder equal to the product of (1) the quotient of
(A) the aggregate number of shares of Common Stock to be sold by the HJL Sellers divided by (B) the
aggregate number of shares of Common Stock then owned by the HJL Sellers times (2) the number of
shares of Common Stock then owned by the Stockholder, on the same terms and conditions and at the
same price per share (the “Drag-Along Price”) applicable to the HJL Sellers.




          Section 2.6.2 Sale Agreement. If the Stockholder is required to sell shares of Common
Stock under this Section 2.6 (a “Drag-Along Seller”), the Stockholder agrees to cooperate
in consummating such a sale, including, without limitation, by becoming a party to the sales
agreement and all other appropriate related agreements, delivering at the consummation of such
sale, stock certificates and other instruments for such shares of Common Stock duly endorsed for
transfer, free and clear of all liens and encumbrances, and voting or consenting in favor of such
transaction (to the extent a vote or consent is required) and taking any other necessary or
appropriate action in furtherance thereof, including the execution and delivery of any other
appropriate agreements, certificates, instruments and other documents (including documents for the
sale or termination of Options if required). In connection with such sale, the Stockholder may be
required to make representations and indemnities to the buyer solely and in customary form with
respect to the Stockholder and the Stockholder’s ownership of, and his authority and rights to
sell, his Drag-Along Shares and shall have no obligation with respect to any transaction expenses
of or on behalf of the HJL Sellers.




8








 








          Section 2.6.3 No Liability. Notwithstanding any other provision contained in this
Section 2.6, there shall be no liability on the part of Bioheart or any of the HJL Sellers in the
event that the sale pursuant to this Section 2.6 is not consummated for any reason whatsoever. The
decision whether to propose or to consummate a Transfer pursuant to this Section 2.6 shall be in
the sole and absolute discretion of the HJL Sellers.




     Section 2.7 Restrictive Legends; Termination of Agreement.



          Section 2.7.1 Legends. Each outstanding certificate representing the Stockholder’s
shares of Common Stock issued prior to the date when the applicable restrictions are terminated
pursuant to Section 2.7.3, shall bear endorsements reading substantially as follows:




               (a) The securities represented by this certificate have not been registered under the
Securities Act of 1933, as amended, or under the securities laws of any state and may not be
transferred, sold or otherwise disposed of except while such a registration is in effect or
pursuant to an exemption from registration under said Act and applicable state securities laws
confirmed to the issuer by an opinion (reasonably satisfactory to the issuer) of counsel
(reasonably satisfactory to the issuer).




               (b) The securities represented by this certificate and the holder of such securities are
subject to the terms and conditions (including, without limitation, voting agreements and
restrictions on transfer) set forth in a Stockholder Agreement, dated
as of ______________, 2006, a
copy of which may be obtained from the issuer of this security. No transfer of such securities
will be made on the books of the issuer unless accompanied by evidence of compliance with the terms
of such agreement.




          Section 2.7.2 Copy of Agreement. A copy of this Agreement shall be filed with the
corporate secretary of Bioheart and kept with the records of Bioheart.




          Section 2.7.3 Termination of Agreement.




               (a) Article I and Article II of this Agreement shall terminate when and if the Company’s IPO
is consummated.




               (b) This entire Agreement (other than Section 2.2 and Section 2.7.4) shall terminate upon the
first to occur of (i) the tenth (10th) annual anniversary of the date of the Agreement, (ii) upon
such time when HJL (together with his family members and trusts for the benefit of him and/or his
family members) and the Stockholders (including the Stockholder party hereto) who are party to this
form of Stockholder Agreement in connection with the Offering contemplated by the Subscription
Agreement (the “Stockholder Parties”) hold in the aggregate less than twenty five percent (25%) of
the outstanding shares of Common Stock, (iii) upon the conclusion of the complete liquidation and
dissolution of the Company, (iv) upon the approval of termination of this Agreement by HJL and the
holders of not less than fifty percent of the aggregate number of shares of Common Stock then held
by the Stockholder Parties, or (v) upon consummation of a reorganization, merger, or consolidation
of, or any sale, transfer, conveyance or disposition of all or substantially all of the assets of,
the Company or other form of corporate transaction, in each case, with respect to which persons who
were the shareholders of the Company immediately prior to such reorganization, merger or
consolidation, sale of assets or other transaction do not, immediately thereafter, own more than
50% of the combined voting power entitled to vote generally in the election of directors of the
reorganized, merged, consolidated or asset-acquiring company’s then outstanding voting securities.





9









 








               (c) Nothing contained in this Section 2.7.3 shall affect or impair any rights or obligations
arising under this Agreement prior to the time of, or in connection with, the termination of
this Agreement. Subject to the foregoing sentence and Section 3.3 hereof, the Stockholder
shall cease to be bound by this Agreement as a “Stockholder” hereunder from and after the time that
such Stockholder ceases to own any Common Stock or any rights, warrants or options to purchase or
exercisable for or convertible into shares of Common Stock (but only if all such Stockholder’s
Common Stock is transferred or otherwise disposed of by such Stockholder as permitted and in
accordance with this Stockholder Agreement).




          Section 2.7.4 Removal of Legends on Stock Certificates. The legend required pursuant
to Section 2.7.1(a) shall cease to be required as to any particular shares of Common Stock (a)
when, in the opinion of counsel for Bioheart, such restriction is no longer required in order to
assure compliance with the Securities Act or (b) when such shares shall have been effectively
registered and sold under the Securities Act. Bioheart or Bioheart’s counsel, at their election,
may request from the Stockholder a certificate or an opinion of such Stockholder’s counsel with
respect to any relevant matters in connection with the removal of the endorsement set forth in
Section 2.7.1(a) from such Stockholder’s stock certificates, any such certificate or opinion of
counsel to be reasonably satisfactory to Bioheart and its counsel.




     The legend referred to in Section 2.7.1(b) shall cease to be required as to any particular
shares of Common Stock when, in the opinion of counsel for Bioheart, the provisions of this
Agreement are no longer applicable to such shares and their Stockholder, in which event the holder
of such shares shall be entitled to receive from Bioheart, new certificates for a like number of
shares of Common Stock not bearing the relevant terminated legend.



ARTICLE III




OTHER AGREEMENTS




     Section 3.1 IPO Lockup Agreement



     The Stockholder shall comply with and agree to any customary form of “lock-up” agreement
(meaning an agreement not to sell or engage in certain specified transactions regarding Common
Stock or other Company securities for a period of time in connection with a public offering) that
is requested by the underwriters managing the Company’s IPO if the term of such lock-up agreement
is not more than 180 days and HJL also agrees to the terms of such lock-up agreement; and the
Stockholder agrees to execute and deliver such form of lock-up agreement.



     Section 3.2 Specific Performance; Injunction



     The parties hereto acknowledge that the rights and obligations under this Agreement are
unique, valuable and bargained for, and that there would be no adequate remedy at law if any party
fails to perform any of its obligations hereunder, and accordingly agree that each party, in
addition to any other remedy to which it may be entitled at law or in equity, shall be entitled (to
the fullest extent permitted by law) to compel specific performance of the obligations of any other
party under this Agreement in accordance with the terms and conditions of this Agreement, and to
obtain injunction against violation of this Agreement, without the need to post or obtain any bond
or similar requirement. Further, the Company may refuse to transfer on its books record ownership
of Common Stock which has been sold or transferred in violation of this Agreement or to recognize
any transferee as one of the Company’s shareholders for any purpose (including without limitation,
for purposes of dividend and voting rights) until all applicable provisions of this Agreement have
been complied with in full. All remedies provided by this Agreement are in addition to other
remedies provided by law.



10









 





     Section 3.3 Recapitalizations and Exchanges Affecting Common Stock



     The provisions of this Agreement shall apply, to the full extent set forth herein with respect
to Common Stock, to any and all shares of capital stock or equity securities of Bioheart or any
successor or assign of Bioheart (whether by merger, consolidation, sale of assets or otherwise)
which may be issued in respect of, in exchange for, or in substitution of, the Common Stock, or
which may be issued by reason of any stock dividend, stock split, reverse stock split, combination,
recapitalization, reclassification or otherwise. Upon the occurrence of any of such events,
numbers of shares and amounts hereunder shall be appropriately adjusted.



     Section 3.4 Indemnification



     The Company shall not amend the indemnification provisions of the Company’s Articles of
Incorporation (as amended, the “Articles”) or Bylaws to eliminate or reduce the
indemnification provided therein for the Company’s directors and officers. The Company may in its
discretion also enter into separate indemnification agreements with its officers and directors.



     Section 3.5 No Right of Employment or Participation in Management



     No Stockholder shall have any right of employment or other employee benefits, or any right to
be a Director or officer of the Company or otherwise participate in the management of the Company
in any manner or respect, solely as a consequence of owning Common Stock in the Company.



     Section 3.6 Stockholder Indemnification. The Stockholder agrees to indemnify the
Company and its officers, directors and controlling persons against any and all losses, claims,
damages, expenses or liabilities to which the Company and such Persons may become subject under any
federal or state securities law, at common law, or otherwise, insofar as such losses, claims,
damages, expenses or liabilities arise out of or are based upon (1) any transfer of any shares of
Common Stock or other securities of the Company by such Stockholder in violation of the Securities
Act or the Securities Exchange of 1934, as amended, the rules and regulations promulgated
thereunder, or other applicable securities laws, or (2) any untrue statement of a material fact in
connection with such Stockholder’s representations pursuant to this Stockholder Agreement or in
connection with such Stockholder’s acquisition of Common Stock or with respect to the facts and
representations supplied to counsel to the Company or to Stockholder’s counsel upon which its
opinion as to a proposed transfer by the Stockholder was based.



     Section 3.7 Failure to Deliver Stock. If the Stockholder (or any personal representative,
administrator, executor or other attorney or representative of, or authorized holder on behalf of,
the Stockholder) who is obligated to sell or deliver shares of Stock (or the certificates
representing such Stock) of the Company hereunder shall fail to sell or deliver such Stock (or
certificates) on the terms and in accordance with the provisions of this Stockholder Agreement
(hereinafter, a “Defaulting Stockholder”), and such failure shall continue for a period of
fifteen (15) days after notice from the Company to such Defaulting Stockholder, then, upon approval
by the Board of Directors of the Company, the sale and delivery of such Stock (and such
certificates) shall nonetheless be deemed conclusively and for all purposes to have been effected
and perfected as required pursuant to this Agreement, and the Company (on behalf of itself, or the
designated party entitled to effect the purchase hereunder), in addition to all other remedies it
may have, shall be authorized to (i) transmit to such obligated party, by registered mail, return
receipt requested, the purchase price for such Stock (if any), on the terms provided for in this
Stockholder Agreement, and (ii) upon written notice to the Stockholder, cancel on the Company’s
stock books and ledger the certificates representing the Stock so to be purchased. Upon any such
action, which if taken by the Company shall be binding and conclusive on all parties, all of the
Defaulting Stockholder’s rights in and to such Stock shall cease and terminate.



11









 





     Section 3.8 Business Days. Whenever the terms of this Stockholder Agreement call for the
performance of a specific act on a specified date, which date falls on a Saturday, Sunday or legal
(banking) holiday in the State of Florida, the date for the performance of such act shall be
postponed to the next succeeding regular business day following such Saturday, Sunday or legal
(banking) holiday.

Section 3.9 Void Transfers in Violation of Agreement. Any attempt by the Stockholder to
transfer any Common Stock in violation of any applicable provision of this Agreement will be void.
The Company will not be required (i) to transfer on its books any Common Stock that has been sold,
given as a gift or otherwise transferred in violation of this Agreement, or (ii) to treat as owner
of such Common Stock, or to accord the right to vote or pay dividends to any purchaser, donee or
other transferee to whom such Common Stock may have been so transferred.



ARTICLE
IV




PREEMPTIVE PURCHAE RIGHTS IN CETAIN SUBSEQUENT FINANCING TRANSACTIONS




     Section 4.1 Exchange Right for Stock in Certain Subsequent Equity Financings. In
the event of the issuance and sale by the Company for cash of shares of any class or series of the
Company’s authorized stock (other than Excluded Stock), including, but not limited to, those shares
which are convertible into shares of Common Stock (which sale may or may not also include the
issuance and sale of shares of Common stock or other securities) during the period commencing on
the Effective Date and terminating one hundred and eighty days thereafter (a “Triggering
Sale”), the Company shall give written notice of such Triggering Sale to the Stockholder,
which notice shall describe the securities proposed to be issued by the Company in such transaction
(the “Included Securities”), and the number, price and payment terms therefore. The
Stockholder shall have the right, for a period of fifteen (15) days following the date of receipt
of such notice, to agree irrevocably and in writing to purchase, at the same price and on the same
terms and conditions (except for the form of payment, which shall be in Shares as provided in the
next succeeding sentence) as in the Triggering Sale, that number (the “Required Number”) of
Included Securities which is equal to the quotient of (a) the product of the number of shares
purchased by the Stockholder pursuant to the Subscription Agreement (the “Payment Shares”)
multiplied by $4.75 (as adjusted for stock splits and similar events as provided in this paragraph
below), divided by (b) the purchase price per share (or other unit, as the case may be) of
the securities constituting the Included Securities. In lieu of using cash as purchase price
consideration for the purchase of Included Securities in the connection with exercising any
purchase right under this Section 4.1, the Stockholder shall use its Payment Shares, properly
tendered and endorsed for transfer to the Company, as purchase currency and consideration (the
“Value Per Share”), which Payment Shares shall, upon the closing of such purchase, be
transferred by the Stockholder to the Company free and clear of all liens, security interests and
encumbrances or adverse claims of any kind or character other than restrictions under applicable
securities laws. The Stockholder may agree to purchase all (but not less than all) of the Required
Number of Included Securities, by written notice thereof — which shall constitute an irrevocable
offer to purchase — given by him or it to the Company prior to the expiration of the aforesaid
fifteen (15) day period, in which event the Company shall sell, and such stockholder shall buy, at
the closing of the Triggering Sale or on a date specified by the Company within a reasonable period
of time (not to exceed fifteen (15) days) after such closing, upon the terms and conditions
specified in the Triggering Sale (except with respect to the purchase consideration, which shall
be paid by the Stockholder’s delivery and transfer to the Company of all the Payment Shares as
provided in the Section), all of the Required Number of Included Securities, which delivery and
transfer shall include the Stockholder’s delivery of stock certificates and other appropriate
instruments of transfer for the Payment Shares, duly endorsed for transfer, so as to effect the
transfer of the Payment Shares to the Company free and clear of all liens and encumbrances other
than restrictions under applicable securities laws. The $4.75 Value Per Share Specified above
relates to the Shares as constituted on the date of this Agreement (and following the closing of
the Subscription



12









 







Agreement, which is being effected at a price of $4.75 per share), which Value Per Share shall be
adjusted appropriately (and without duplication of any other adjustment required hereunder or
otherwise) to reflect the effect of any stock split, stock dividend, combination, reclassification
or similar event or transaction, and any such adjustment made in good faith by the Company’s Board
of Directors in accordance with the foregoing shall be binding on Stockholders.



     Notwithstanding anything to the contrary in this Agreement, upon the consummation of the
Stockholder’s purchase of Included Securities under this Section 4.1 (including without limitation
the Stockholder’s execution and delivery of the required agreements and insturments in connection
therewith which shall provide rights equivalent to those of the purchasers of Included Securities
(the “Section 4.1 Agreements”)), the Stockholder and the Stockholder’s Common Stock and
other securities of the Company which were subject to this Agreement prior to such purchases under
Section 4.1 together shall continue to be subject to and bound by this Agreement following such
purchase as applicable pursuant to the terms hereof; provided, however, that it is
hereby further agreed that if the provisions of this Agreement (upon application of this paragraph)
conflict with the terms of the Section 4.1 Agreements, then this Agreement and/or the Section 4.1
Agreements shall be limited, modified and/or interpreted as and to the extent necessary,
permissable and/or appropriate to resolve any such conflict; it being agreed that any such
limitation, modification or interpretation of the terms hereof or thereof and the determination of
the existence of any such conflict shall be determined solely by the Company’s Board of Directors
in good faith.



     Section 4.2 Provisions of General Application. Notwithsatanding any term or provision
of this Agreement ot the contrary, no purchase or acquisition rights are provided or available
under this Article IV with regard to grants, issuances or slaes of Excluded Stock.



     Section 4.3 Termination. Notwithstanding any other term or provisons of this
Agreement, the terms and provisons of this Article IV (ant the rights and obligations provided
hereunder) shall terminate, and become null, void and of no further forece or effect, upon the
earlier of (i) termination of this Article IV or this Agreement as provided in Article III, or (ii)
in the event that the Stockholder ceases to own at least fifty percent (50%) of the Shares acquired
under the Subscription Agreement or (iii) one hundred and eighty (180) days after the Effective
Date.



ARTICLE V




VOTING




Section 5.1 Covenant to Vote




     Each of the Stockholders who owns or holds Common Stock entitled to vote on stockholder
matters shall appear in person or by proxy at any annual or special meeting of stockholders of
Bioheart for the purpose of obtaining a quorum and shall vote the shares of Common Stock entitled
to vote on stockholder matters owned by such Stockholder, either in person or by proxy, at any
annual or special meeting of stockholders of Bioheart, or shall so act by consensual action of
stockholders (i.e., action by written consent as permitted by law); and (A) if the vote is called
for the purpose of voting on the election or removal of directors, then each Stockholder shall vote
(or act by consensual action) in favor of (i) the election of the “Bioheart Nominees” (as defined
below) as the directors constituting the Board of Directors of Bioheart and (ii) the removal of
directors of Bioheart who are “Bioheart Removal Candidates” (as defined below), and (B) if the vote
is called for the purpose of voting on any matter that is subject to a “Bioheart Vote
Recommendation” (as defined below) each Stockholder shall vote (or act by consensual action) in
accordance with the applicable Bioheart Vote Recommendation (i.e., the Stockholder shall vote “For”
or “Against” or otherwise in the manner directed by the Bioheart Vote



13









 







Recommendation). In addition, each Stockholder who holds Common Stock entitled to vote on
stockholder matters shall appear in person or by proxy at any annual or special meeting of
stockholders for the purpose of obtaining a quorum and shall vote the shares of Common Stock
entitled to vote on stockholder matters owned by such Stockholder, either in person or by proxy,
upon any matter submitted to a vote of the stockholders of Bioheart, or shall so act by consensual
action of stockholders, in a manner so as to be consistent and not in conflict with, and to
implement and effect, the terms of this Agreement. The terms “Bioheart Nominees”,
“Bioheart Removal Candidates” and “Bioheart Vote Recommendation” shall mean such
director nominees, such directors to be removed, and such vote recommendations, respectively, as
determined by HJL in his discretion so long as HJL (together with his wife and any trusts for the
benefit of him and/or his family members) hold in the aggregate Twenty Five Percent (25%) or more
of Bioheart’s outstanding shares of Common Stock (or otherwise hold Bioheart securities having
Twenty Five Percent (25%) or more of the combined voting power of Bioheart’s outstanding
securities).



     Section 5.2 No Other Voting or Conflicting Agreements



     No Stockholder shall grant any proxy (except as provided in Section 5.3 below) or enter into
or agree to be bound by any voting trust with respect to the Common Stock nor shall any Stockholder
enter into any stockholder agreement or other agreements or arrangements of any kind with any
Person with respect to the Common Stock or the Company that is inconsistent with, or that limits in
any way the effectiveness or implementation of, the provisions of this Agreement (whether or not
such agreements and arrangements are with other Stockholders or holders of Common Stock or other
Persons that are not parties to this Agreement), and each Stockholder represents and warrants to
Bioheart that no such prohibited agreement or arrangement with respect to such Stockholder exists
as of the time such Stockholder became a party to this Agreement. The foregoing prohibition
includes, but is not limited to, agreements or arrangements with respect to the acquisition,
disposition or voting of (or providing a consent with respect to) shares of Common Stock
inconsistent with the provisions of this Agreement. No Stockholder shall act, for any reason, on
such Stockholder’s own behalf or as a member of a group or in concert with any other Persons in
connection with the acquisition, disposition or voting of shares of Common Stock, or otherwise in
any manner, which is inconsistent with the provisions of this Agreement.



     Section 5.3 Grant of Proxy; Corporate Governance Matters.



          Section 5.3.1 Irrevocable Proxy. Each Stockholder hereby irrevocably constitutes and
appoints the “Proxy” (as defined below) as such Stockholder’s proxy, with full right and power to
vote all of such Stockholder’s shares of Common Stock, in accordance with any vote of such shares
required under Article V of this Agreement with respect to any Bioheart Nominees, Bioheart Removal
Candidates or any Bioheart Vote Recommendation. The term “Proxy” means HJL (and/or any
other individual selected by HJL, or designated as attorney-in-fact by HJL, to be Proxy in
connection with a particular vote). The proxy granted hereby shall remain in effect for so long as
and at all times that the provisions of Section 5.1 of this Agreement shall remain in effect and
shall terminate immediately and automatically only upon the termination of Section 5.1 of this
Agreement (or termination of this Article V) in accordance with the provisions hereof. The proxy
granted hereby is irrevocable and is coupled with an interest, as provided in Section 607.0722(5)
of the Florida Business Corporation Act.




14









 








          Section 5.3.2 Scope of Agreement. This Agreement shall govern the vote of each
Stockholder’s shares of Common Stock to the extent provided herein, whether the vote is made by the
Proxy or by the Stockholder or any other Person, with respect to any and all matters voted upon by
shareholders of the Company, whether at a meeting or pursuant to written consent or otherwise,
including, but not limited to the following (the following enumeration does not mean that the items
must or will be submitted to a vote of the shareholders or that a shareholder vote is required in
connection with such items):




          (i) any change in the authorized capital stock or capital structure of the Company, including
the creation of any additional class of shares or the increase of the number of authorized shares
of any class;




          (ii) any amendment of the Company’s Articles of Incorporation or bylaws;




          (iii) any merger, share exchange, sale of all or substantially all of the assets or
dissolution of the Company;




          (iv) the election of the Company’s Board of Directors;




          (v) any change in the number of directors fixed to serve on the Company’s Board of Directors;
and




          (vi) to the extent a shareholder vote is otherwise required, the establishment of restricted
stock, stock option or similar plans, or the issuance by the Company of shares of Common Stock,
whether in connection with acquisitions, strategic relationships or otherwise.




          Unless terminated as hereinafter provided, this Agreement shall remain in effect without
regard to any action taken by shareholders of the Company.




          Section 5.3.3 Voting of Shares by Proxy. Each Stockholder and the Company agrees and
covenants that at any meeting of shareholders of the Company and/or in connection with any
corporate action by the shareholders of the Company as to which the Proxy is authorized to vote
under Section 5.3.1, all of such Stockholder’s shares of Common Stock (whether now owned or
hereafter acquired) shall be voted by the Proxy in the manner and to the effect as required under
Section 5.1 hereof, unless such Stockholder otherwise votes its shares of Common Stock in the
manner as required under Section 5.1.




          Section 5.3.4 Limitation of Proxy’s Liability. The Proxy shall not incur any
liability or responsibility by reason of any error of judgment, mistake of law or other mistake, or
for any act or omission of any agent or attorney, or for any misconstruction of this Agreement, or
for any action of any kind taken or omitted hereunder or believed by him to be in accordance with
the provisions and intents hereof, except for his own individual intentional misconduct in bad
faith.




15









 








ARTICLE VI




MISCELLANEOUS




     Section 6.1 Notices



     All notices, requests, demands, and other communications under this Agreement shall be in
writing and shall be deemed to have been duly given on the date of service if served personally on
the
party to whom notice is to be given, on the date of transmittal of services via facsimile or
telecopy to the party to whom notice is to be given (if receipt is orally confirmed by phone and a
confirming copy delivered thereafter in accordance with this Section), or on the fifth day after
mailing if mailed to the party to whom notice is to be given, by first class mail, registered or
certified, postage prepaid, or via a nationally recognized overnight courier providing a receipt
for delivery and properly addressed as set forth on the signature pages to this Agreement, as the
case may be. Any party may change its address for purposes of this paragraph by giving notice of
the new address to each of the other parties in the manner set forth above.



     Section 6.2 Successors and Assigns



     This Agreement shall be binding upon and shall inure to the benefit of the parties, and their
respective successors and assigns. If the Stockholder or any Affiliate thereof or any Transferee
of the Stockholder shall acquire any shares of Common Stock in any manner, whether by operation of
law or otherwise, such shares and such transferee shall be held subject to all of the terms of this
Agreement and by taking and holding such shares such Person shall be conclusively deemed to have
agreed to be bound by and to perform all of the terms and provisions of this Agreement, except in
the case of a Stockholder’s Transfer for which the Transferee is not required to take shares
subject to this Agreement as expressly provided in Section 2.1(c) hereof.



     Section 6.3 Governing Law



     This Agreement shall be governed and construed and enforced in accordance with the laws of the
State of Florida, without regard to the principles of conflicts of law thereof.



     Section 6.4 Descriptive Headings, Etc.



     The headings in this Agreement are for convenience of reference only and shall not limit or
otherwise affect the meaning of terms contained herein. Unless the context of this Agreement
otherwise requires, references to “hereof,” “herein,” “hereby,” “hereunder” and similar terms shall
refer to this entire Agreement.



     Section 6.5 Amendment; Waiver



     Except as specifically provided otherwise herein (including without limitation Section 2.7.3
hereof), this Agreement may not be amended or supplemented or terminated except by an instrument in
writing signed by each of (i) Bioheart, (ii) HJL (but only if he is a party to this Agreement at
such time) and (iii) either the Stockholder, or by such Stockholder Parties holding not less than
fifty percent of the aggregate number of shares of Common Stock then held by the Stockholder
Parties. HJL is not a “Stockholder” under this Agreement. The foregoing notwithstanding,
Bioheart, without the consent of any other party hereto, may in its discretion amend the signature
pages hereto in order to add any holder of Bioheart Common Stock or other Bioheart securities as a
party hereto in the capacity of a Stockholder hereunder if such person is required to become a
party hereto under the terms of this Agreement.



     Except as expressly provided herein neither this Agreement nor any term hereof may be amended,
waived, discharged or terminated other than by a written instrument signed by the party against
whom enforcement of any such amendment, waiver, discharge or termination is sought; provided,
however, that any amendments or terminations of this Agreement effected in accordance with the
foregoing paragraph of this Section 5.5 shall be binding upon all parties hereto, including those
not signing such amendment or termination.



16









 





     No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a
waiver of any other provisions hereof (whether or not similar), nor shall any such waiver
constitute a continuing waiver unless otherwise expressly so provided.



     Section 6.6 Severability



     If any term or provision of this Agreement shall to any extent be held to be invalid or
unenforceable under applicable law by a court of competent jurisdiction, the remainder of this
Agreement shall not be affected thereby, and each term and provision of this Agreement shall be
valid and enforceable to the fullest extent permitted by law. Upon the determination that any term
or other provision is invalid, illegal or incapable of being enforced, the parties shall negotiate
in good faith to modify this Agreement so as to effect their original intent as closely as possible
in an acceptable manner to the end that transactions contemplated hereby are fulfilled to the
extent possible, but in any event this Agreement shall be construed to give effect to the purposes
and intents indicated herein to the fullest practicable extent, whether or not the parties are able
to determine such modification to this Agreement.



     Section 6.7 Further Assurances



     The parties hereto shall from time to time execute and deliver all such further documents and
do all acts and things as the other party may reasonably require to effectively carry out or better
evidence or perfect the full intent and meaning of this Agreement, including, without limitation,
to the extent necessary or appropriate or requested by Bioheart, using all reasonable efforts to
cause the amendment of the Articles of Incorporation or the ByLaws of Bioheart in order to provide
for the enforcement of this Agreement in accordance with its terms.



     Section 6.8 Entire Agreement; Counterparts



     This Agreement represents the complete agreement among the parties hereto with respect to the
transactions contemplated hereby and supersedes all prior written or oral agreements and
understandings. This Agreement may be executed by any one or more of the parties hereto in any
number of counterparts, each of which shall be deemed to be an original, but all such counterparts
shall together constitute one and the same instrument.



     Section 6.9 No Third Party Beneficiaries



     The provisions of this Agreement shall be only for the benefit of the parties to this
Agreement, and no other Person shall have any third party beneficiary or other right hereunder.



     Section 6.10 Pronouns.



     Whenever the context of this Agreement permits, the masculine or neuter gender shall
include the feminine, masculine and neuter genders, and any reference to the singular or
plural shall be interchangeable with the other.



     Section 6.11 Dispute Resolution



     If two or more parties should have a material dispute arising out of or relating to this
Agreement or the parties’ respective rights and duties hereunder, then the parties will resolve
such dispute in the following manner: (i) any party may at any time deliver to the other parties to
the dispute a written dispute notice setting forth a brief description of the issue for which such
notice initiates the dispute resolution mechanism contemplated by this Section 5.11; (ii) during
the forty-five (45) day period



17









 







following the delivery of the notice described in the foregoing clause (i) above, appropriate
representatives of the various parties will meet and seek to resolve the disputed issue through
negotiation, (iii) if representatives of the parties are unable to resolve the disputed issue
through negotiation, then within thirty (30) days after the period described in the foregoing
clause (ii) above, the parties will refer the issue (to the exclusion of a court of law) to final
and binding arbitration in Broward County, Florida, in accordance with the then existing rules (the
“Rules”) of the American Arbitration Association (“AAA”), and judgment upon the
award rendered by the arbitrators may be entered in any court having jurisdiction thereof;
provided, however, that the law applicable to any controversy shall be the law of the State of
Florida, regardless of principles of conflicts of laws. In any arbitration pursuant to this
Agreement, (i) discovery shall be allowed and governed by the Florida Code of Civil Procedure and
(ii) the award or decision shall be rendered by a majority of the members of a Board of Arbitration
consisting of three (3) members, one of whom shall be appointed by each of the respective parties
and the third of whom shall be the chairman of the panel and be appointed by mutual agreement of
said two party-appointed arbitrators. In the event of failure of said two arbitrators to agree
within sixty (60) days after the commencement of the arbitration proceeding upon the appointment of
the third arbitrator, the third arbitrator shall be appointed by the AAA in accordance with the
Rules. In the event that either party shall fail to appoint an arbitrator within thirty (30) days
after the commencement of the arbitration proceedings, such arbitrator and the third arbitrator
shall be appointed by the AAA in accordance with the Rules. Nothing set forth above shall be
interpreted to prevent the parties from agreeing in writing to submit any dispute to a single
arbitrator in lieu of a three (3) member Board of Arbitration or to submit the dispute to any state
or federal court of proper jurisdiction. Upon the completion of the selection of the Board of
Arbitration (or if the parties agree otherwise in writing, a single arbitrator), an award or
decision shall be rendered within no more than forty-five (45) days. Notwithstanding the
foregoing, the request by either party for specific performance or preliminary or permanent
injunctive relief, whether prohibitive or mandatory, shall not be subject to mandatory arbitration
under this Section 5.11 and may be adjudicated only by the courts of the State of Florida or the
U.S. District Court in Florida which are located in Broward County, Florida.



[signatures on following page]




18









 








     IN WITNESS WHEREOF, the parties below have caused this Stockholder Agreement to be duly
executed as of the respective date(s) set forth below.



	 	 	 	 	 
	 	BIOHEART, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	Howard J. Leonhardt 	 
	 	 	Title:  	Chief Executive Officer 	 
	 


Address: 13794 NW 4th Street

Suite 212

Sunrise, Florida 33325




Dated: _______________________, 2006




	 	 	 	 	 
	 	 	 
	 	 	 
	 	HOWARD J. LEONHARDT, Individually 	 
	 	Address: 	 	3425 Stallion Lane
    	 
	 	 	 	
Weston, Florida 33331 	 
	 



[Stockholder’s signature is on the following page]




19









 








THIS PAGE INTENTIONALLY LEFT BLANK




20









 








STOCKHOLDER’S SIGNATURE PAGE




Bioheart, Inc. Stockholder Agreement





     This is the signature page to the STOCKHOLDER AGREEMENT by and among the undersigned
STOCKHOLDER(s), BIOHEART, INC., a Florida corporation, and HOWARD J. LEONHARDT, and each person
signing this page as a Stockholder below intends to be legally bound by such Stockholder Agreement
as the “Stockholder” thereunder.





	 	 	 
	STOCKHOLDER(s):
	 	 
	 
	 	 
	 
	 	 
	 	 
	 
	Print Name of Stockholder
	 	 
	 
	 	 
	 
	 	 
	 
	 	 
	 	 
	 
	Print Name of Joint Stockholder (if any)
	 	 
	 
	 	 
	 
	 	 
	X
	 	 
	 
	 	 
	Signature of Stockholder
	 	 
	 
	 	 
	X
	 	 
	 
	 	 
	Signature of Joint Stockholder (if any)
	 	 
	 
	 	 
	 
	 	 
	Capacity of Signatory (if Stockholder
is not an Individual) (the Signatory
confirms that he or she is an
authorized representative of the
Stockholder)
	 	 









	 	 	 
	If
Stockholder is not an Individual, check proper
box, and indicate Capacity of signatory in the
space provided below under the signature:

	 	 
	 
	 	 
	o Corporation
	 	 
	o Trust
	 	 
	o Partnership
	 	 
	o Other ______________________________
	 	 
	 
	 	 
	If Joint Ownership, check one:
	 	 
	o Joint Tenants with Right of Survivorship
	 	 
	o Tenants in Common
	 	 
	o Tenants by the Entireties
	 	 
	o Community Property
	 	 
	 
	 	 
	 
	 	 
	Address for Stockholder(s)
	 	 
	 
	 	 
	 
	 	 
	City State Zip Code
	 	 
	 
	 	 
	Date
of Stockholder Signature:

 ___________________, 2006
	 	 











21









 





THIS PAGE INTENTIONALLY LEFT BLANK





22









 





EXHIBIT C




ASSIGNMENT FORM





			
	FOR VALUE RECEIVED,	 	
  





hereby sells, assigns and transfers unto





			
	Name	 	
  





(Please typewrite or print in block letters)



the right to purchase up to _____________ shares of Common Stock of BIOHEART, INC., a Florida
corporation, pursuant to Section 4 of this Warrant, to the extent of shares as to which such right
is exercisable and does hereby irrevocably constitute and appoint Attorney, to transfer the same on
the books of the Company with full power of substitution in the premises.




DATED: ________,200_
















 




Exhibit D



 



Page 1




17 C.F.R. § 230.144A




Effective: [See Text Amendments]




Code of Federal Regulations Currentness
 Title
17. Commodity and Securities Exchanges
  Chapter II.
Securities and Exchange Commission
   
Part 230. General Rules and Regulations, Securities Act of 1933 (Refs & Annos)
    General
(Refs & Annos)



§ 230.144A Private resales of securities to institutions.




Preliminary Notes:



1. This section relates solely to the application of section 5 of the Act and not to antifraud or
other provisions of the federal securities laws.



2. Attempted compliance with this section does not act as an exclusive election; any seller
hereunder may also claim the availability of any other applicable exemption from the registration
requirements of the Act.



3. In view of the objective of this section and the policies underlying the Act, this section is
not available with respect to any transaction or series of transactions that, although in technical
compliance with this section, is part of a plan or scheme to evade the registration provisions of
the Act. In such cases, registration under the Act is required.



4. Nothing in this section obviates the need for any issuer or any other person to comply with the
securities registration or broker-dealer registration requirements of the Securities Exchange Act
of 1934 (the Exchange Act), whenever such requirements are applicable.



5. Nothing in this section obviates the need for any person to comply with any applicable state law
relating to the offer or sale of securities.



6. Securities acquired in a transaction made pursuant to the provisions of this section are deemed
to be restricted securities within the meaning of § 230.144(a)(3) of this chapter.



7. The fact that purchasers of securities from the issuer thereof may purchase such securities with
a view to reselling such securities pursuant to this section will not affect the availability to
such issuer of an exemption under section 4(2) of the Act, or Regulation D under the Act, from the
registration requirements of the Act.




(a) Definitions.





(1) For purposes of this section, qualified institutional buyer shall mean:




(i) Any of the following entities, acting for its own account or the accounts of other qualified
institutional buyers, that in the aggregate owns and invests on a discretionary basis at least
$100 million in securities of issuers that are not affiliated with the entity:




(A) Any insurance company as defined in section 2(13) of the Act;



     Note: A purchase by an insurance company for one or more of its separate accounts, as defined
by section 2(a)(37) of the Investment Company Act of 1940 (the “Investment Company Act”), which are
neither registered under section 8 of the Investment Company Act nor required to be so registered,
shall be deemed to be a purchase for the account of such insurance company.




(B) Any investment company registered under the Investment Company Act or any business
development company as defined in section 2(a)(48) of that Act;




(C) Any Small Business Investment Company licensed by the U.S. Small Business Administration
under section 301(c) or (d) of the Small Business Investment Act of 1958;




(D) Any plan established and maintained by a state, its political subdivisions, or any
agency or instrumentality of a state or its political subdivisions, for the benefit of its
employees;




(E) Any employee benefit plan within the meaning of title I of the Employee Retirement
Income Security Act of 1974;



© 2007 Thomson/West. No Claim to Orig. U.S. Govt. Works.





 









 





Page 2




17 C.F.R. § 230.144A








(F) Any trust fund whose trustee is a bank or
trust company and whose participants are exclusively plans of the types identified in
paragraph (a)(1)(i) (D) or (E) of this section, except trust funds that include as
participants individual retirement accounts or H.R. 10 plans.




(G) Any business development company as defined in section 202(a)(22) of the Investment
Advisers Act of 1940;




(H) Any organization described in section 501(c)(3) of the Internal Revenue Code,
corporation (other than a bank as defined in section 3(a)(2) of the Act or a savings and
loan association or other institution referenced in section 3(a)(5)(A) of the Act or a
foreign bank or savings and loan association or equivalent institution), partnership, or
Massachusetts or similar business trust; and




(I) Any investment adviser registered under the Investment Advisers Act.




(ii) Any dealer registered pursuant to section 15 of the Exchange Act, acting for its own
account or the accounts of other qualified institutional buyers, that in the aggregate owns and
invests on a discretionary basis at least $10 million of securities of issuers that are not
affiliated with the dealer, Provided, That securities constituting the whole or a part of an
unsold allotment to or subscription by a dealer as a participant in a public offering shall not
be deemed to be owned by such dealer;




(iii) Any dealer registered pursuant to section 15 of the Exchange Act acting in a riskless
principal transaction on behalf of a qualified institutional buyer;



     Note: A registered dealer may act as agent, on a non-discretionary basis, in a transaction
with a qualified institutional buyer without itself having to be a qualified institutional buyer.




(iv) Any investment company registered under the Investment Company Act, acting for its own
account or for the accounts of other qualified institutional buyers, that is part of a family of
investment companies which own in the aggregate at least $100 million in securities of issuers,
other than issuers that are affiliated with the investment company or are part of such family of
investment companies. Family of investment companies means any two or more investment companies
registered under the Investment Company Act, except for a unit investment trust whose assets
consist solely of shares of one or more registered investment companies, that have the same
investment adviser (or, in the case of unit investment trusts, the same depositor), Provided
That, for purposes of this section:




(A) Each series of a series company (as defined in Rule 18f-2 under the Investment Company
Act [17 CFR 270.18f-2] ) shall be deemed to be a separate investment company; and




(B) Investment companies shall be deemed to have the same adviser (or depositor) if their
advisers (or depositors) are majority-owned subsidiaries of the same parent, or if one
investment company’s adviser (or depositor) is a majority-owned subsidiary of the other
investment company’s adviser (or depositor);




(v) Any entity, all of the equity owners of which are qualified institutional buyers, acting for
its own account or the accounts of other qualified institutional buyers; and




(vi) Any bank as defined in section 3(a)(2) of the Act, any savings and loan association or
other institution as referenced in section 3(a)(5)(A) of the Act, or any foreign bank or savings
and loan association or equivalent institution, acting for its own account or the accounts of
other qualified institutional buyers, that in the aggregate owns and invests on a discretionary
basis at least $100 million in securities of issuers that are not affiliated with it and that
has an audited net worth of at least $25 million as demonstrated in its latest annual financial
statements, as of a date not more than 16 months preceding the date of sale under the Rule in
the case of a U.S. bank or savings and loan association, and not more than 18 months preceding
such date of sale for a foreign bank or savings and loan association or equivalent institution.




(2) In determining the aggregate amount of securities owned and invested on a discretionary
basis by an entity, the following instruments and interests shall be excluded: bank deposit
notes and certificates of deposit; loan participations;
repurchase agreements; securities owned but subject to a repurchase agreement; and currency,
interest rate and commodity swaps.



© 2007 Thomson/West. No Claim to Orig. U.S. Govt. Works.




 









 





Page 3




17 C.F.R. § 230.144A





(3) The aggregate value of securities owned and invested on a discretionary basis by an entity
shall be the cost of such securities, except where the entity reports its securities holdings in
its financial statements on the basis of their market value, and no current information with
respect to the cost of those securities has been published. In the latter event, the securities
may be valued at market for purposes of this section.




(4) In determining the aggregate amount of securities owned by an entity and invested on a
discretionary basis, securities owned by subsidiaries of the entity that are consolidated with
the entity in its financial statements prepared in accordance with generally accepted accounting
principles may be included if the investments of such subsidiaries are managed under the
direction of the entity, except that, unless the entity is a reporting company under section 13
or 15(d) of the Exchange Act, securities owned by such subsidiaries may not be included if the
entity itself is a majority-owned subsidiary that would be included in the consolidated
financial statements of another enterprise.




(5) For purposes of this section, riskless principal transaction means a transaction in which a
dealer buys a security from any person and makes a simultaneous offsetting sale of such security
to a qualified institutional buyer, including another dealer acting as riskless principal for a
qualified institutional buyer.




(6) For purposes of this section, effective conversion premium means the amount, expressed as a
percentage of the security’s conversion value, by which the price at issuance of a convertible
security exceeds its conversion value.




(7) For purposes of this section, effective exercise premium means the amount, expressed as a
percentage of the warrant’s exercise value, by which the sum of the price at issuance and the
exercise price of a warrant exceeds its exercise value.


(b) Sales by persons other than issuers or dealers. Any person, other than the issuer or a dealer,
who offers or sells securities in compliance with the conditions set forth in paragraph (d) of this
section shall be deemed not to be engaged in a distribution of such securities and therefore not to
be an underwriter of such securities within the meaning of sections 2(11) and 4(1) of the Act.



(c) Sales by Dealers. Any dealer who offers or sells securities in compliance with the conditions
set forth in paragraph (d) of this section shall be deemed not to be a participant in a
distribution of such securities within the meaning of section 4(3)(C) of the Act and not to be an
underwriter of such securities within the meaning of section 2(11) of the Act, and such securities
shall be deemed not to have been offered to the public within the meaning of section 4(3)(A) of the
Act.



(d) Conditions to be met. To qualify for exemption under this section, an offer or sale must meet
the following conditions:





(1) The securities are offered or sold only to a qualified institutional buyer or to an offeree
or purchaser that the seller and any person acting on behalf of the seller reasonably believe is
a qualified institutional buyer. In determining whether a prospective purchaser is a qualified
institutional buyer, the seller and any person acting on its behalf shall be entitled to rely
upon the following non-exclusive methods of establishing the prospective purchaser’s ownership
and discretionary investments of securities:




(i) The prospective purchaser’s most recent publicly available financial statements, Provided
That such statements present the information as of a date within 16 months preceding the date of
sale of securities under this section in the case of a U.S. purchaser and within 18 months
preceding such date of sale for a foreign purchaser;




(ii) The most recent publicly available information appearing in documents filed by the
prospective purchaser with the Commission or another United States federal, state, or local
governmental agency or self-regulatory organization, or with a foreign governmental agency or
self-regulatory organization, Provided That any such information is as of a date within 16
months preceding the date of sale of securities under this section in the case of a U.S.
purchaser and within 18 months preceding such date of sale for a foreign purchaser;



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Page 4




17 C.F.R. § 230.144A





(iii) The most recent publicly available information appearing in a recognized securities
manual, Provided That such information is as of a date within 16 months preceding the date of
sale of securities under this section in the case of a U.S. purchaser and within 18 months
preceding such date of sale for a foreign purchaser; or




(iv) A certification by the chief financial officer, a person fulfilling an equivalent function,
or other executive officer of the purchaser, specifying the amount of securities owned and
invested on a discretionary basis by the purchaser as of a specific date on or since the close
of the purchaser’s most recent fiscal year, or, in the case of a purchaser that is a member of a
family of investment companies, a certification by an executive officer of the investment
adviser specifying the amount of securities owned by the family of investment companies as of a
specific date on or since the close of the purchaser’s most recent fiscal year;




(2) The seller and any person acting on its behalf takes reasonable steps to ensure that the
purchaser is aware that the seller may rely on the exemption from the provisions of section 5 of
the Act provided by this section;




(3) The securities offered or sold:




(i) Were not, when issued, of the same class as securities listed on a national securities
exchange registered under section 6 of the Exchange Act or quoted in a U.S. automated
inter-dealer quotation system; Provided, That securities that are convertible or exchangeable
into securities so listed or quoted at the time of issuance and that had an effective conversion
premium of less than 10 percent, shall be treated as securities of the class into which they are
convertible or exchangeable; and that warrants that may be exercised for securities so listed
or quoted at the time of issuance, for a period of less than 3 years from the date of issuance,
or that had an effective exercise premium of less than 10 percent, shall be treated as
securities of the class to be issued upon exercise; and Provided further, That the Commission
may from time to time, taking into account then-existing market practices, designate additional
securities and classes of securities that will not be deemed of the same class as securities
listed on a national securities exchange or quoted in a U.S. automated inter-dealer quotation
system; and




(ii) Are not securities of an open-end investment company, unit investment trust or face-amount
certificate company that is or is required to be registered under section 8 of the Investment
Company Act; and




(4)(i) In the case of securities of an issuer that is neither subject to section 13 or 15(d) of
the Exchange Act, nor exempt from reporting pursuant to Rule 12g3-2(b) (§ 240.12g3-2(b)
of this chapter) under the Exchange Act, nor a foreign government as defined in Rule 405 (§
230.405 of this chapter) eligible to register securities under Schedule B of the Act, the
holder and a prospective purchaser designated by the holder have the right to obtain from the
issuer, upon request of the holder, and the prospective purchaser has received from the issuer,
the seller, or a person acting on either of their behalf, at or prior to the time of sale, upon
such prospective purchaser’s request to the holder or the issuer, the following information
(which shall be reasonably current in relation to the date of resale under this section): a
very brief statement of the nature of the business of the issuer and the products and services
it offers; and the issuer’s most recent balance sheet and profit and loss and retained earnings
statements, and similar financial statements for such part of the two preceding fiscal years as
the issuer has been in operation (the financial statements should be audited to the extent
reasonably available).




(ii) The requirement that the information be reasonably current will be presumed to be satisfied
if:




(A) The balance sheet is as of a date less than 16 months before the date of resale, the
statements of profit and loss and retained earnings are for the 12 months preceding the date
of such balance sheet, and if such balance sheet is not as of a date less than 6 months
before the date of resale, it shall be accompanied by additional statements of profit and
loss and retained earnings for the period from the date of such balance sheet to a date less
than 6 months before the date of resale; and



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Page 5




17 C.F.R. § 230.144A






(B) The statement of the nature of the issuer’s business and its products and
services offered is as of a date within 12 months prior to the date of resale; or




(C) With regard to foreign private issuers, the required information meets the timing
requirements of the issuer’s home country or principal trading markets.


(e) Offers and sales of securities pursuant to this section shall be deemed not to affect the
availability of any exemption or safe harbor relating to any previous or subsequent offer or sale
of such securities by the issuer or any prior or subsequent holder thereof.



[55 FR 17945, April 30, 1990; 57 FR 48722, Oct. 28, 1992]



SOURCE: 62 FR 24573, May 6, 1997; 63 FR 6384, Feb. 6, 1998; 63 FR 13943,
13984, March 23, 1998; 64 FR 61449, Nov. 10, 1999; 65 FR 47284, Aug. 2, 2000;
66 FR 8896, 9017, Feb. 5, 2001; 67 FR 230, Jan. 2, 2002; 67 FR 13536,
March 22, 2002; 67 FR 19673, April 23, 2002; 68 FR 57777, Oct. 6, 2003; 72
FR 20414, April 24, 2007, unless otherwise noted.



AUTHORITY: 15 U.S.C. 77b, 77c, 77d, 77f, 77g, 77h,
77j, 77r, 77s, 77z-3, 77sss, 78c, 78d,
78j, 78l, 78m, 78n, 78o, 78t, 78w,
78ll(d), 78mm, 80a-8, 80a-24, 80a-28, 80a-29,
80a-30, and 80a-37, unless otherwise noted.; Section 230.151 is also issued under
15 U.S.C. 77s(a).; Section 230.160 is also issued under Section 104(d) of the Electronic
Signatures Act.; Sections 230.400 to 230.499 issued under 15 U.S.C. 77f, 77h,
77j, 77s, unless otherwise noted.; Section 230.473 is also issued under 15
U.S.C. 79(t).; Section 230.502 is also issued under 15 U.S.C. 80a-8, 80a-29,
80a-30.



17 C. F. R. § 230.144A, 17 CFR § 230.144A




     Current through July 19, 2007; 72 FR 39581



Copr. © 2007 Thomson/West




END OF DOCUMENT




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EXHIBIT E



Page 1




1992 WL 55818 (S.E.C. No - Action Letter)




(SEC No-Action Letter)




*1 Black




Box

Incorporated




Publicly Available February 28, 1992




SEC LETTER




1933 Act / s 5




February 28, 1992

Publicly Available February 28, 1992




Kenneth R. Koch, Esq.

Squadron, Ellenoff, Pleasant & Lehrer

551 Fifth Avenue

New York, New York 10176Dear Mr. Koch:



Our responses to the interpretive questions raised in your letter of December 27, 1991 regarding
the positions expressed in the staff’s letter dated June 26, 1990 to Black Box Incorporated (the
“Black Box letter”) are as follows:





1. The staff’s positions in the Black Box letter were not based on the financial condition of
the company. Specifically, in response to your concerns expressed during our telephone
conversations, the staff’s position with respect to integration of the Black Box registered
initial public offering and a simultaneous unregistered offering by Black Box of convertible
debentures (the “Black Box offerings”) was a policy position taken primarily in consideration of
the nature and number of the offerees, and not based on the financial condition of the company.





2. The number of offerees and purchasers is a factor considered by the staff in evaluating the
applicability of the policy position. As we discussed, the Black Box policy position on
integration was simply a formal articulation of an informal position the staff has taken
previously with respect to simultaneous registered offerings and unregistered offerings to a
limited number of first-tier institutional investors in connection with structured financings.
Because the position expressed with respect to the Black Box offerings is a policy position, it
is narrowly construed by the staff. The staff interprets the position to be limited in
applicability to situations where a registered offering would otherwise be integrated with an
unregistered offering to i) persons who would be qualified institutional buyers for purposes of
Rule 144A and 2) no more than two or three large institutional accredited investors. The
position does not constitute a determination by the staff that the unregistered offering is in
fact a bona fide private placement.[FN1]


FN1 With regard to the availability of the Section 4(2) private offering exemption, it should be
noted that the staff takes the position that the filing of a registration statement is deemed to be
the commencement of the public offering. See letter from former director of the Division of
Corporation Finance, John J. Huber, to Michael Bradfield, general counsel of the Board of Governors
of the Federal Reserve System (March 23, 1984). Further, your attention is directed to SEC
Litigation Release No. 10241 (December 19, 1983), regarding SEC v. Michael A. Traiger, Traiger
Energy Investments (U.S.D.C.C.D.Cal.Civil Action No. 83-2738-LTL JPx).





3. The position of the staff with respect to integration of the Black Box offerings would not
have been different if common stock had been sold in both the public and the private offerings.
In this regard, it should be noted that the staff historically has treated an offering of a
class of securities and an offering of another security convertible into that class of
securities as offerings of the same class of securities for purposes of the integration
doctrine.


*2 I trust that the foregoing information is of assistance to you. Should you have any further
questions regarding this matter, please feel free to contact me again.




Sincerely,




Cecilia D. Blye

Special Counsel

December 27, 1991




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	1992 WL 55818 (S.E.C. No — Action Letter)
	 	Page 2






Special
Counsel
December 27, 1991
Office of Chief Counsel

Division of Corporation Finance

Securities and Exchange Commission

Judiciary Plaza

450 Fifth Street, N.W.

Washington,. D.C. 20549




Re: Black Box Incorporated



Gentlemen:



At the suggestion of Cecilia Blye of the staff of the Securities and Exchange Commission (the
“Commission”), I am writing to pose three interpretive questions concerning the Black Box
Incorporated no-action letter (“Black Box”) recently promulgated by the Commission. In Black Box,
the issuer on whose behalf the no-action request was made (the “Company”), proposed to engage in a
contemporaneous private placement of convertible debentures and a public offering of common stock.
Under the circumstances set forth in Black Box, the private placement and the public offering were
not integrated.



1. In Black Box, the Company was apparently financially troubled. Would the Staff’s answer have
changed if Black Box was not financially troubled or is Black Box a “hardship” exception to the
general rules on integration?



2. In Black Box, the private placement was made to up to 35 “qualified institutional buyers” (as
defined in Rule 144A promulgated under the Act, and up to four “accredited investors” (as defined
in Regulation D promulgated under the Act). Is there any limit on the number of “qualified
institutional buyers” or “accredited investors” to whom offers may be made or to whom sales may be
made in order to fall within the rationale of Black Box? In this connection, I note Ms. Blye’s
concern that sales made to large numbers of investors may indicate that a purportedly private
placement has been conducted as a public offering. However, when the Commission adopted
Regulation D, the Commission shifted away from the strict numerical limitations on investors under
former Rule 146. When Regulation D was adopted in 1982, the limitations on numbers of investors
(except for the limit of 35 on non-accredited investors) were eliminated. Rule 502(c) under
Regulation D focuses instead on the manner of offering and not the number of offerees. Thus,
although a large number of investors in an offering may be some indication that the offering was
conducted in a manner violative of the prohibition against a “general solicitation” under Rule
502(c), it is not by itself determinative of whether such a general solicitation has occurred.
Accordingly, I would think that the Commission would continue to rely on the body of interpretative
law that has grown up around Rule 502(c), rather than a numerical limitation on investors, to
determine whether a public offering has been made.



If the Staff does believe that a numerical limitation on investors is appropriate for Black Box to
apply, the limit should probably only apply to the number of “accredited investors” involved in the
private placement and should not restrict the number of “qualified institutional buyers”.
Inherent in the Commission’s recent adoption of Rule 144A is the assumption that “qualified
institutional buyers” do not need the protection which the registration process provides.



*3 3. In Black Box, the Company was privately placing convertible debentures and publicly selling
common stock. Would the Staff’s answer have changed if the securities being sold in the private
placement and the public offering were identical? For example, would the answer remain the same
if Common Stock were being sold in both the private placement and the public offering.



We appreciate the Commission’s consideration of these questions. If you have any questions
concerning the above, please contact me at (212)476-8362.



An original and seven copies of this letter are submitted herewith.



Very truly yours,



Kenneth R. Koch

SQUADRON, ELLENOFF, PLESENT & LEHRER

551 Fifth Avenue

New York, NY 10176

(212)661-6500





© 2007 Thomson/West. No Claim to Orig. U.S. Govt. Works.