Form of Securities Purchase Agreement


     

    Exhibit
      10.1

     

    SECURITIES
      PURCHASE AGREEMENT

     

    This
      Securities Purchase Agreement (this “Agreement”)
      is dated as of March 3, 2006, between RegeneRx Biopharmaceuticals, Inc., a
      Delaware corporation (the “Company”),
      and each purchaser identified on the signature pages hereto (each, including
      its
      successors and assigns, a “Purchaser”
      and collectively the “Purchasers”).

     

    WHEREAS,
      subject to the terms and conditions set forth in this Agreement, the Company
      desires to issue and sell to each Purchaser, and the Purchasers, severally
      and
      not jointly, desire to purchase from the Company, shares of Common Stock and
      Warrants as set forth herein on the Closing Date (as defined herein) pursuant
      to
      an effective Registration Statement on Form S-3, Commission File No.
      333-125861.

     

    NOW,
      THEREFORE, IN CONSIDERATION of the mutual covenants contained in this Agreement,
      and for other good and valuable consideration the receipt and adequacy of which
      are hereby acknowledged, the Company and each Purchaser agree as
      follows:

     

    ARTICLE
      I.

    DEFINITIONS

     

    1.1      
      Definitions.
      In addition to the
      terms defined elsewhere in this Agreement, for all purposes of this Agreement,
      the following terms have the meanings indicated in this Section
      1.1:

     

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

     

    “Affiliate”
      means any Person that, directly or indirectly through one or more
      intermediaries, controls or is controlled by or is under common control with
      a
      Person as such terms are used in and construed under Rule 144. With respect
      to a
      Purchaser, any investment fund or managed account that is managed on a
      discretionary basis by the same investment manager as such Purchaser will be
      deemed to be an Affiliate of such Purchaser.

     

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

     

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

     

    “Closing
      Date”
      means the later of (i) the third (3rd)
      Trading Day; (ii) upon the approval by the American Stock Exchange for the
      listing of the Shares; or (iii) upon the approval by the Corporate Financing
      Department of the National Association of Securities Dealers, in each case
      following the date of this Agreement.

     

    “Commission”
      means the United States Securities and Exchange Commission.

     

    “Common
      Stock”
      means the common stock of the Company, par value $0.001 per share, and any
      securities into which such common stock may hereafter be reclassified.


     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    “Common
      Stock Equivalents”
      means any securities of the Company which would entitle the holder thereof
      to
      acquire at any time Common Stock, including, without limitation, any debt,
      preferred stock, rights, options, warrants or other instrument that is at any
      time convertible into or exercisable or exchangeable for, or otherwise entitles
      the holder thereof to receive, Common Stock.

     

    “Company
      Counsel”
      means Patton Boggs LLP.

     

    “Effective
      Date”
      means the date that the Registration Statement was first declared effective
      by
      the Commission.

     

    “Exchange
      Act”
      means the Securities Exchange Act of 1934, as amended.

     

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

     

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

     

    “Material
      Adverse Effect”
      shall have the meaning ascribed to such term in Section 3.1(b).

     

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

     

    “Per
      Share Purchase Price”
      equals $2.81, subject
      to adjustment for reverse and forward stock splits, stock dividends, stock
      combinations and other similar transactions of the Common Stock that occur
      after
      the date of this Agreement and prior to the Closing.

     

    “Person”
      means an individual or corporation, partnership, trust, incorporated or
      unincorporated association, joint venture, limited liability company, joint
      stock company, government (or an agency or subdivision thereof) or other entity
      of any kind.

     

    “Registration
      Statement”
      means the registration statement on Form S-3 of the Company, (Commission File
      No. 333-125861) covering the sale by the Company to the Purchasers of the
      Shares, the Warrants and the Warrant Shares, and shall include the prospectus
      included therein and any prospectus supplement delivered to the Purchasers
      in
      connection with the transactions contemplated by this Agreement.

     

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

     

    “Rule
      144”
      means Rule 144 promulgated by the Commission pursuant to the Securities Act,
      as
      such rule may be amended from time to time, or any similar rule or regulation
      hereafter adopted by the Commission having substantially the same effect as
      such
      rule. 

     

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

     

    
      
        
        

      

      
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    “Securities
      Act”
      means the Securities Act of 1933, as amended.

     

    “Shares”
      means the shares of Common Stock issued or issuable to each Purchaser pursuant
      to this Agreement, including, but not limited to the Warrant
      Shares.

     

    “Short
      Sale”
      means, all “short sales” as defined in Rule 3b-3 of the Exchange
      Act. 

     

    “Subscription
      Amount”
      means, as to each Purchaser, the amounts set forth below such Purchaser’s
      signature block on the signature page hereto, in United States dollars and
      in
      immediately available funds.

     

    “Subsidiary”
      means any “significant subsidiary” as defined in Rule 1-02(w) of the Regulation
      S-X promulgated by the Commission under the Exchange Act.

     

    “Trading
      Day”
      means (i) a day on which the Common Stock is traded on a Trading Market (other
      than the OTC Bulletin Board), or (ii) if the Common Stock is not listed on
      a
      Trading Market (other than the OTC Bulletin Board), a day on which the Common
      Stock is traded in the over-the-counter market, as reported by the OTC Bulletin
      Board, or (iii) if the Common Stock is not quoted on the OTC Bulletin Board,
      a
      day on which the Common Stock is quoted in the over-the-counter market as
      reported by the National Quotation Bureau Incorporated (or any similar
      organization or agency succeeding to its functions of reporting prices);
provided
      that in the event that the Common Stock is not listed or quoted as set forth
      in
      (i), (ii) and (iii) hereof, then Trading Day shall mean a Business
      Day.

     

    “Trading
      Market”
      means whichever of the New York Stock Exchange, the American Stock Exchange,
      the
      NASDAQ National Market, the NASDAQ Capital Market or OTC Bulletin Board on
      which
      the Common Stock is listed or quoted for trading on the date in question.


     

    “Transaction
      Documents”
      means this Agreement, the Warrants and any other instruments, documents or
      agreements executed or delivered in connection with the transactions
      contemplated hereunder, including, without limitation, the Registration
      Statement.

     

    “Warrants”
      means the Common Stock Purchase Warrants, in the form of Exhibit
      A,
      delivered to the Purchasers at the Closing in accordance with Section 2.2(a)(ii)
      hereof, which warrants shall be exercisable immediately upon issuance for a
      term
      of five years commencing six months after the Closing Date and have an exercise
      price equal to $4.06, subject
      to adjustment as provided therein.

     

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

     

    
      
        
        

      

      
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    ARTICLE
      II.

    PURCHASE
      AND SALE

     

    2.1      
      Closing.
      On the Closing Date, each Purchaser shall purchase from the Company, severally
      and not jointly with the other Purchasers, and the Company shall issue and
      sell
      to each Purchaser, a number of Shares equal to such Purchaser’s Subscription
      Amount divided by the Per Share Purchase Price together with a number of
      Warrants equal to 35.00% of such number of Shares, rounded down to the nearest
      share. Upon satisfaction of the conditions set forth in Section 2.3, the Closing
      shall occur telephonically or at such location as the parties shall mutually
      agree.

     

    2.2      
      Deliveries.

     

    (a)      
      On
      the Closing Date, the Company shall deliver or cause to be delivered to each
      Purchaser the following:

     

    (i)      
      via
      the Depository Trust Company’s Deposit Withdrawal Agent Commission system, the
      number of Shares equal to such Purchaser’s Subscription Amount divided by the
      Per Share Purchase Price, in accordance with each such Purchaser’s written
      delivery instructions;

     

    (ii)      
      within
      three Business Days of the Closing Date, a Warrant, registered in the name
      of
      such Purchaser, pursuant to which such Purchaser shall have the right to acquire
      up to the number of shares of Common Stock equal to 35.00% of the Shares,
      rounded down to the nearest share, to be issued to such Purchaser at the
      Closing; 

     

    (iii)      
      any
      prospectus and prospectus supplement as required under the Securities Act;
      and

     

    (iv)      
      a
      legal opinion of Company Counsel, in the form of Exhibit
      B
      attached hereto, addressed to the Purchasers and providing that RBC Capital
      Markets Corporation (“RBC”) and each of the Purchasers are entitled to rely
      thereon.

     

    (b)      
      On
      the Closing Date, each Purchaser shall deliver or cause to be delivered to
      the
      Company such Purchaser’s Subscription Amount by wire transfer to the account as
      specified in writing by the Company.

     

    (c)      
      On
      the Closing Date, the Company shall cause the prospectus supplement delivered
      by
      the Company in connection herewith to be filed with the Commission via the
      EDGAR
      system.

     

    
      
        
        

      

      
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    2.3      
      Closing
      Conditions. 

     

    (a)      
      The
      obligations of the Company hereunder in connection with the Closing are subject
      to the following conditions being met:

     

    (i)      
      all
      representations and warranties of the Purchasers contained herein were true
      and
      correct on the date hereof and shall remain true and correct as of the Closing
      Date;
      

     

    (ii)      all
      obligations, covenants and agreements of the Purchasers required to be performed
      at or prior to the Closing Date shall have been performed; and

     

    (iii)     the
      delivery by each Purchaser of such Purchaser’s Subscription Amount in accordance
      with Section 2.2(b) of this Agreement.

     

    (b)      
      The
      respective obligations of the Purchasers hereunder in connection with the
      Closing are subject to the following conditions being met or waived in writing
      by each Purchaser:

     

    (i)      
      all
      representations and warranties of the Company contained herein were true and
      correct on the date hereof and shall remain true and correct as of the Closing
      Date;

     

    (ii)      all
      obligations, covenants and agreements of the Company required to be performed
      at
      or prior to the Closing Date shall have been performed; 

     

    (iii)     the
      delivery by the Company of the items set forth in Section 2.2(a) of this
      Agreement; 

     

    (iv)     there
      shall have been no Material Adverse Effect with respect to the Company since
      the
      date hereof;

     

    (v)      the
      Registration Statement shall be effective and available for the issuance and
      sale of the Shares, the Warrants and the Warrant Shares hereunder; 

     

    (vi)     a
      signed letter from Reznick Group, PC, addressed to the Purchasers and dated,
      respectively, the date of this Agreement and the Closing Date, in form and
      substance reasonably satisfactory to RBC containing statements and information
      of the type ordinarily included in accountants’ “comfort letters” with respect
      to the financial statements and certain financial information contained
      (directly or via incorporation by reference) in the Registration Statement;
      

     

    (vii)    no
      order preventing or suspending the use of any prospectus or prospectus
      supplement shall have been or shall be in effect and no order suspending the
      effectiveness of the Registration Statement shall be in effect and no
      proceedings for such purpose shall be pending before or threatened by the


     

    
      
        
        

      

      
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    Commission,
      and any requests for additional information on the part of the Commission (to
      be
      included in the Registration Statement or the prospectus or prospectus
      supplement or otherwise) shall have been complied with to the satisfaction
      of
      the Commission and the Purchasers; and

     

    (viii)   from
      the date hereof to the Closing Date, trading in the Common Stock shall not
      have
      been suspended by the Commission and, at any time prior to the Closing Date,
      trading in securities generally as reported by Bloomberg Financial Markets
      shall
      not have been suspended or limited, or minimum prices shall not have been
      established on securities whose trades are reported by such service, or on
      any
      Trading Market, nor shall a banking moratorium have been declared either by
      the
      United States or New York state authorities nor shall there have occurred any
      material outbreak or escalation of hostilities or other national or
      international calamity of such magnitude in its effect on, or any material
      adverse change in, any financial market which, in each case, in the reasonable
      judgment of each Purchaser, makes it impracticable or inadvisable to purchase
      the Shares at the Closing.

     

    ARTICLE
      III.

    REPRESENTATIONS
      AND WARRANTIES

     

    3.1      
      Representations
      and Warranties of the Company. The Company represents and warrants to each
      Purchaser, except as set forth in the Registration Statement:

     

    (a)      
      Subsidiaries.
      The Company has no direct or indirect Subsidiaries. 

     

    (b)      
      Organization
      and Qualification.
      The Company is duly incorporated or otherwise organized, validly existing and
      in
      good standing under the laws of the State of Delaware, with the requisite power
      and authority to own and use its properties and assets and to carry on its
      business as currently conducted. The Company is not in violation or default
      of
      any of the provisions of its certificate of incorporation, bylaws or other
      organizational or charter documents, each as amended. The Company is duly
      qualified to conduct business and is in good standing as a foreign corporation
      in each jurisdiction in which the nature of the business conducted or property
      owned by it makes such qualification necessary, except where the failure to
      be
      so qualified or in good standing, as the case may be, could not have or
      reasonably be expected to result in, individually or in the aggregate (i) a
      material adverse effect on the legality, validity or enforceability of any
      Transaction Document, (ii) a material adverse effect on the results of
      operations, assets, prospects, business or condition (financial or otherwise)
      of
      the Company, or (iii) a material adverse effect on the Company’s ability to
      perform in any material respect on a timely basis its obligations under any
      Transaction Document (any of (i), (ii) or (iii), a “Material
      Adverse Effect”)
      and no Action has been instituted in any such jurisdiction revoking, limiting
      or
      curtailing or seeking to revoke, limit or curtail such power and authority
      or
      qualification.

     

    (c)      
      Authorization;
      Enforcement.
      The Company has the requisite corporate power and authority to enter into and
      to
      consummate the transactions contemplated by 

     

    
      
        
        

      

      
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    each
      of the Transaction Documents and otherwise to carry out its obligations
      hereunder and thereunder. The execution and delivery of each of the Transaction
      Documents by the Company and the consummation by it of the transactions
      contemplated hereby and thereby have been duly authorized by all necessary
      action on the part of the Company and no further action is required by the
      Company in connection herewith and therewith other than in connection with
      the
      Required Approvals. Each Transaction Document has been (or upon delivery will
      have been) duly executed by the Company and, when delivered in accordance with
      the terms hereof, will constitute the valid and binding obligation of the
      Company enforceable against the Company in accordance with its terms except
      (i)
      as limited by applicable bankruptcy, insolvency, reorganization, moratorium
      and
      other laws of general application affecting enforcement of creditors’ rights
      generally and (ii) as limited by laws relating to the availability of specific
      performance, injunctive relief or other equitable remedies.

     

    (d)      
      No
      Conflicts.
      The execution, delivery and performance of the Transaction Documents by the
      Company, the issuance and sale of the Shares and the Warrants and the Warrant
      Shares and the consummation by the Company of the other transactions
      contemplated hereby and thereby do not and will not (i) conflict with or violate
      any provision of the Company’s certificate or articles of incorporation, bylaws
      or other organizational or charter documents, or (ii) conflict with, or
      constitute a default (or an event that with notice or lapse of time or both
      would become a default) under, result in the creation of any Lien upon any
      of
      the properties or assets of the Company, or give to others any rights of
      termination, amendment, acceleration or cancellation (with or without notice,
      lapse of time or both) of, any agreement, credit facility, debt or other
      instrument (evidencing a debt of the Company or otherwise) or other
      understanding to which the Company is a party or by which any property or asset
      of the Company is bound or affected, or (iii) subject to the Required Approvals,
      conflict with or result in a violation of any law, rule, regulation, order,
      judgment, injunction, decree or other restriction of the American Stock
      Exchange, any court or governmental authority to which the Company is subject,
      including without limitation all foreign, federal, state and local laws
      applicable to its business and
      under the Federal Food, Drug, and Cosmetic Act, 21 USC 321 et seq. and all
      implementing rules and regulations thereunder, or
      by which any property or asset of the Company is bound or affected, or (iv)
      conflict with or violate the terms of any agreement by which the Company is
      bound or to which any property or asset of the Company is bound or affected;
      except in the case of each of clauses (ii) and (iii), such as could not have
      or
      reasonably be expected to result in, individually or in the aggregate, a
      Material Adverse Effect.

     

    (e)      
      Filings,
      Consents and Approvals.
      The Company is not required to obtain any consent, approval (including, but
      not
      limited to, the approval of the stockholders of the Company), waiver,
      authorization or order of, give any notice to, or make any filing or
      registration with, any court or other federal, state, local or other
      governmental authority or other Person in connection with the execution,
      delivery and performance by the Company of the Transaction Documents, other
      than
      (i) filings required pursuant to Section 4.1 and Section 4.4, (ii) filings
      required in connection with the issuance and listing on the American Stock
      Exchange of the Shares and (iii) such filings as are

     

    
      
        
        

      

      
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    required
      to be made under applicable state securities laws (collectively, the
“Required
      Approvals”).

     

    (f)      
      Issuance
      of the Shares, Warrants and Warrant Shares; Reservation of Common
      Stock.
      The Shares and the Warrants are duly authorized and, when issued and paid for
      in
      accordance with this Agreement, will be duly and validly issued, fully paid
      and
      nonassessable, free and clear of all Liens. Upon exercise of the Warrants in
      accordance with their terms, the Warrant Shares will be validly issued, fully
      paid and nonassessable, free and clear of all Liens. The Company has reserved
      from its duly authorized capital stock the maximum number of shares of Common
      Stock issuable pursuant to this Agreement and the Warrants. The issuance by
      the
      Company of the Shares, the Warrants and the Warrant Shares has been registered
      under the Securities Act and all of the Shares, Warrants and Warrant Shares
      are
      freely transferable and tradable by the Purchasers without restriction.
The
      Registration Statement is effective and available for the issuance of the
Shares
      and the Warrants, and upon exercise of the Warrants in accordance with their
      terms, the Warrant Shares
      and the Company has not received any notice that the Commission has issued
      or
      intends to issue a stop-order with respect to the Registration Statement or
      that
      the Commission otherwise has suspended or withdrawn the effectiveness of the
      Registration Statement, either temporarily or permanently, or intends or has
      threatened in writing to do so. The “Plan of Distribution” section under the
      Registration Statement permits the issuance and sale of the Shares,
      the Warrants and the Warrant Shares
      hereunder. Upon receipt of the Shares
      and
      making payment for them in accordance with the terms hereof, the Purchasers
      will
      have good and marketable title to such Purchased
      Shares
      and the Shares will be freely tradable on the
      America Stock Exchange. As of the date hereof, the Company has reserved a
      sufficient number of shares of Common Stock for the purpose of enabling the
      Company to issue the Shares and the Warrant Shares pursuant to this
      Agreement.

     

    (g)      
      Capitalization.
      The capitalization of the Company is as described in the Company’s Quarterly
      Report on Form 10-Q for the quarter ended September 30, 2005 as filed with
      the
      Commission. The Company has not issued any capital stock since such filing
      other
      than pursuant to the exercise of employee stock options under the Company’s
      stock option plans, the issuance of shares of Common Stock to employees pursuant
      to the Company’s employee stock purchase plan and pursuant to the conversion,
      exercise or exchange of outstanding Common Stock Equivalents. No Person has
      any
      right of first refusal, preemptive right, registration right, right of
      participation, or any similar right to participate in the transactions
      contemplated by the Transaction Documents. The issue and sale of the Shares
      will
      not obligate the Company to issue shares of Common Stock or other securities
      to
      any Person (other than the Purchasers) and will not result in a right of any
      holder of securities of the Company to adjust the exercise, conversion, exchange
      or reset price under such securities. All of the outstanding shares of capital
      stock of the Company have been duly authorized and are validly issued, fully
      paid and nonassessable, have been issued in compliance with all federal and
      state securities laws, and none of such outstanding shares was issued in
      violation of any preemptive rights or similar rights to subscribe for or
      purchase securities. No further approval or authorization of any stockholder,
      the Board of Directors of the Company or any other third party is required
      for
      the issuance and sale of the Shares. Except as disclosed in the SEC Reports,
      there are 

     

    
      
        
        

      

      
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    no
      stockholders’ agreements, voting agreements or other similar agreements with
      respect to the Company’s capital stock to which the Company is a party or, to
      the knowledge of the Company, between or among any of the Company’s
      stockholders.

     

    (h)      
      SEC
      Reports; Financial Statements.
      The Company has filed all reports required to be filed by it under the Exchange
      Act, including pursuant to Section 13(a) or 15(d) thereof, for the two years
      preceding the date hereof (the foregoing materials, including the exhibits
      thereto, being collectively referred to herein as the “SEC
      Reports”)
      on a timely basis or has received a valid extension of such time of filing
      and
      has filed any such SEC Reports prior to the expiration of any such extension.
      As
      of their respective dates, the SEC Reports complied in all material respects
      with the requirements of the Securities Act and the Exchange Act and the rules
      and regulations of the Commission promulgated thereunder, and none of the SEC
      Reports, when filed, contained any untrue statement of a material fact or
      omitted to state a material fact required to be stated therein or necessary
      in
      order to make the statements therein, in the light of the circumstances under
      which they were made, not misleading. The Registration Statement and any
      prospectus included therein, including the prospectus supplement to be filed
      covering the transactions covered hereby, comply or will comply, as the case
      may
      be, in all material respects with the requirements of the Securities Act and
      the
      Exchange Act and the rules and regulations of the Commission promulgated
      thereunder, and none of the Registration Statement or any such prospectus
      contain or contained any untrue statement of a material fact or omits or omitted
      to state a material fact required to be stated therein or necessary in order
      to
      make the statements therein, in the case of any prospectus in the light of
      the
      circumstances under which they were made, not misleading. The financial
      statements of the Company included in the SEC Reports comply in all material
      respects with applicable accounting requirements and the rules and regulations
      of the Commission with respect thereto as in effect at the time of filing.
      Such
      financial statements have been prepared in accordance with United States
      generally accepted accounting principles applied on a consistent basis during
      the periods involved (“GAAP”),
      except as may be otherwise specified in such financial statements or the notes
      thereto and except that unaudited financial statements may not contain all
      footnotes required by GAAP, and fairly present in all material respects the
      financial position of the Company and its consolidated subsidiaries as of and
      for the dates thereof and the results of operations and cash flows for the
      periods then ended, subject, in the case of unaudited statements, to normal,
      immaterial, year-end audit adjustments.

     

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

     

    
      
        
        

      

      
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    and
      (v) the Company has not issued any equity securities to any officer, director
      or
      Affiliate, except pursuant to existing Company stock option plans. The Company
      does not have pending before the Commission any request for confidential
      treatment of information.

     

    (j)      
      Litigation.
      There is no action, claim, suit, inquiry, notice of violation, proceeding or
      investigation pending or, to the knowledge of the Company, threatened against
      or
      affecting the Company or any of its properties before or by any court,
      arbitrator, governmental or administrative agency or regulatory authority
      (federal, state, county, local or foreign) (collectively, an “Action”)
      which (i) adversely affects or challenges the legality, validity or
      enforceability of any of the Transaction Documents or the Shares or (ii) could,
      if there were an unfavorable decision, have or reasonably be expected to result
      in a Material Adverse Effect. Neither the Company nor any director or officer
      of
      the Company is or has been the subject of any Action involving a claim of
      violation of or liability under federal or state securities laws or a claim
      of
      breach of fiduciary duty. There has not been, and to the knowledge of the
      Company, there is not pending or contemplated, any investigation by the
      Commission involving the Company or any current or former director or officer
      of
      the Company. The Commission has not issued any stop order or other order
      suspending the effectiveness of any registration statement filed by the Company
      under the Exchange Act or the Securities Act.

     

    (k)      
      Labor
      Relations.
      No material labor dispute exists or, to the knowledge of the Company, is
      imminent with respect to any of the employees of the Company.

     

    (l)      
      Compliance.
      The Company (i) is not in default under or in violation of (and no event has
      occurred that has not been waived that, with notice or lapse of time or both,
      would result in a default by the Company under), nor has the Company received
      notice of a claim that it is in default under or that it is in violation of,
      any
      indenture, loan or credit agreement or any other agreement or instrument to
      which it is a party or by which it or any of its properties is bound (whether
      or
      not such default or violation has been waived), (ii) is not in violation of
      any
      order of any court, arbitrator or governmental body, or (iii) is not nor has
      been in violation of any statute, rule or regulation of any governmental
      authority, including without limitation all foreign, federal, state and local
      laws applicable to its business and
      under the Federal Food, Drug, and Cosmetic Act, 21 USC 321 et seq. and all
      implementing rules and regulations thereunder, which violation would have a
      Material Adverse Effect.

     

    (m)      
      Material
      Permits.
      The Company possesses all certificates, authorizations and permits issued by
      the
      appropriate federal, state, local or foreign regulatory authorities necessary
      to
      conduct their respective businesses as described in the SEC Reports, except
      where the failure to possess such permits could not have or reasonably be
      expected to result in a Material Adverse Effect (“Material
      Permits”),
      and the Company has not received any notice of Actions relating to the
      revocation or modification of any Material Permit.

     

    (n)      
      Application
      of Takeover Protections.
      The Company and its Board of Directors have taken all necessary action, if
      any,
      to render inapplicable any control share 

     

    
      
        
        

      

      
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    acquisition,
      business combination, poison pill (including any distribution under a rights
      agreement) or other similar anti-takeover provision under the Company’s charter
      documents or the laws of its state of incorporation that is or could become
      applicable to any of the Purchasers as a result of the Purchasers and the
      Company fulfilling their obligations or exercising their rights under the
      Transaction Documents, including, without limitation, as a result of the
      Company’s issuance of the Shares and the Warrrants and the Purchasers’ ownership
      of the Shares and the Warrants.

     

    (o)      
      Title
      to Assets.
      The Company has good and marketable title in fee simple to all real property
      owned by them that is material to its business and good and marketable title
      in
      all personal property owned by the Company that is material to its business,
      in
      each case free and clear of all Liens, except for Liens as do not materially
      affect the value of such property and do not materially interfere with the
      use
      made and proposed to be made of such property by the Company. Any real property
      and facilities or personal property held under lease by the Company is held
      by
      the Company under valid, subsisting and enforceable leases of which the Company
      is in compliance, except as could not, individually or in the aggregate, have
      or
      reasonably be expected to have a Material Adverse Effect.

     

    (p)      
      Patents
      and Trademarks.
      The Company has, or has rights to use, all patents, patent applications,
      trademarks, trademark applications, service marks, trade names, copyrights,
      licenses and other similar rights necessary or material for use in connection
      with its business as described in the SEC Reports and which the failure to
      so
      have could have a Material Adverse Effect (collectively, the “Intellectual
      Property Rights”).
      The Company has not received a written notice that the Intellectual Property
      Rights used by the Company violates or infringes upon the rights of any Person.
      To the knowledge of the Company, all such Intellectual Property Rights are
      enforceable and there is no existing infringement by another Person of any
      of
      the Intellectual Property Rights of others. 

     

    (q)      
      Listing
      and Maintenance Requirements.
      The Common Stock is registered pursuant to Section 12(g) of the Exchange Act,
      and the Company has taken no action designed to, or which to its knowledge
      is
      likely to have the effect of, terminating the registration of the Common Stock
      under the Exchange Act nor has the Company received any notification that the
      Commission is contemplating terminating such registration. The Company has
      not,
      in the 12 months preceding the date hereof, received notice from any Trading
      Market on which the Common Stock is or has been listed or quoted to the effect
      that the Company is not in compliance with the listing or maintenance
      requirements of such Trading Market. The Company is in compliance with all
      such
      listing and maintenance requirements.

     

    (r)      
      Disclosure.
      The Company confirms that, neither the Company nor any other Person acting
      on
      its behalf has provided any of the Purchasers or their agents or counsel with
      any information that constitutes or might constitute material, non-public
      information except with respect to the transactions contemplated by the
      Transaction Documents. The Company understands and confirms that the Purchasers
      will rely on the foregoing representations and covenants in effecting
      transactions in securities of the 

     

    
      
        
        

      

      
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    Company.
      All disclosure provided to the Purchasers regarding the Company, its business
      and the transactions contemplated hereby furnished by or on behalf of the
      Company with respect to the transactions contemplated hereby and the
      representations and warranties made herein are true and correct and do not
      contain any untrue statement of a material fact or omit to state any material
      fact necessary in order to make the statements made therein, in the light of
      the
      circumstances under which they were made, not misleading. The Company
      acknowledges and agrees that no Purchaser makes or has made any representations
      or warranties with respect to the transactions contemplated hereby other than
      those specifically set forth in Section 3.2 hereof.

     

    (s)      
      No
      Integrated Offering.
      Assuming the accuracy of the Purchasers’ representations and warranties set
      forth in Section 3.2, neither the Company, nor any of its affiliates, nor any
      Person acting on its or their behalf has, directly or indirectly, made any
      offers or sales of any security or solicited any offers to buy any security,
      under circumstances that would, to the knowledge of the Company, cause the
      sale
      of the Shares to be integrated with prior offerings by the Company for purposes
      of any applicable stockholder approval provisions, including, without
      limitation, under the rules and regulations of any exchange or automated
      quotation system on which any of the securities of the Company are listed or
      designated.

     

    (t)      
      Acknowledgment
      Regarding Purchasers’ Purchase of Shares.
      The Company acknowledges and agrees that each of the Purchasers is acting solely
      in the capacity of an arm's length purchaser with respect to the Transaction
      Documents and the transactions contemplated hereby. The Company further
      acknowledges that no Purchaser is acting as a financial advisor or fiduciary
      of
      the Company (or in any similar capacity) with respect to this Agreement and
      the
      transactions contemplated hereby and any advice given by any Purchaser or any
      of
      their respective representatives or agents in connection with this Agreement
      and
      the transactions contemplated hereby is merely incidental to the Purchasers’
purchase of the Shares. The Company further represents to each Purchaser that
      the Company’s decision to enter into this Agreement has been based solely on the
      independent evaluation of the transactions contemplated hereby by the Company
      and its representatives.

     

    (u)      
      Acknowledgement
      Regarding Trading Activity.
      Anything in this Agreement or elsewhere herein to the contrary notwithstanding
      (except for Section 4.7 hereof as to the Purchasers), it is understood and
      agreed by the Company (i) that none of the Purchasers or any Person to whom
      an
      offer of Shares have been made (each, an “Offeree”)
      have been asked to agree, nor has any Purchaser or Offeree agreed, to desist
      from purchasing or selling, long and/or short, securities of the Company, or
      “derivative” securities based on securities issued by the Company or to hold the
      Shares, securities of the Company, or “derivative” securities based on
      securities issued by the Company for any specified term; (ii) that past or
      future open market or other transactions by any Purchaser or Offeree, including
      without limitation, Short Sales or “derivative” transactions, before or after
      the closing of this or future private placement transactions, may negatively
      impact the market price of the Company’s publicly-traded securities; (iii) that
      any Purchaser or Offeree, and counter parties in “derivative” transactions to
      which any such Purchaser or Offeree is a party, directly or indirectly,
      presently may have a 

     

    
      
        
        

      

      
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    “short”
      position in the Common Stock, and (iv) that no Purchaser or Offeree shall be
      deemed to have any affiliation with or control over any arm’s length
      counter-party in any “derivative” transaction.

     

    (v)      
      Transactions
      With Affiliates and Employees.
      None of the officers or directors of the Company and, to the knowledge of the
      Company, none of the employees of the Company is presently a party to any
      transaction with the Company (other than for services as employees, officers
      and
      directors), that would be required to be disclosed as of the date hereof in
      an
      SEC Report pursuant to the requirements of Item 404 of Regulation S-K
      promulgated under the Securities Act.

     

    (w)      
      Internal
      Accounting Controls.
      The Company maintains a system of internal accounting controls sufficient to
      provide reasonable assurance that (i) transactions are executed in accordance
      with management’s general or specific authorizations, (ii) transactions are
      recorded as necessary to permit preparation of financial statements in
      conformity with GAAP and to maintain asset accountability, (iii) access to
      assets is permitted only in accordance with management’s general or specific
      authorization, and (iv) the recorded accountability for assets is compared
      with
      the existing assets at reasonable intervals and appropriate action is taken
      with
      respect to any differences. The Company has established disclosure controls
      and
      procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the Company
      and designed such disclosure controls and procedures to ensure that material
      information relating to the Company, including its Subsidiaries, is made known
      to the certifying officers by others within those entities, particularly during
      the period in which the Company’s Forms 10-K or 10-Q, as the case may be, is
      being prepared. The Company’s certifying officers have evaluated the
      effectiveness of the Company’s controls and procedures as of the Evaluation
      Date. The Company presented in its most recently filed Form 10-K or Form 10-Q
      the conclusions of the certifying officers about the effectiveness of the
      disclosure controls and procedures based on their evaluations as of the
      Evaluation Date. Since the Evaluation Date, there have been no significant
      changes in the Company’s internal controls (as described in Item 308(c) of
      Regulation S-K under the Exchange Act) or, to the Company’s knowledge, in other
      factors that could significantly affect the Company’s internal
      controls.

     

    (x)      
      Investment
      Company.
      The Company is not, and will not after the consummation of the offering of
      Shares contemplated by this Agreement be, an “investment company” or an
      Affiliate of an “investment company,” within the meaning of the Investment
      Company Act of 1940, as amended.

     

    (y)      
      Certain
      Fees.
      Except with respect to RBC, no brokerage or finder’s fees or commissions are or
      will be payable by the Company to any broker, financial advisor or consultant,
      finder, placement agent, investment banker, bank or other Person with respect
      to
      the transactions contemplated by this Agreement. The Purchasers shall have
      no
      obligation with respect to any fees or with respect to any claims (other than
      such fees or commissions owed by an Purchaser pursuant to written agreements
      executed by such Purchaser which fees or commissions shall be the sole
      responsibility of such Purchaser ) made by or on behalf of other Persons for
      fees of a type contemplated in this Section 

     

    
      
        
        

      

      
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    3.1(y)
      that may be due in connection with the transactions contemplated by this
      Agreement.

     

    3.2      
      Representations
      and Warranties of the Purchasers.
      Each Purchaser hereby, for itself and for no other Purchaser, represents and
      warrants as of the date hereof and as of the Closing Date to the Company as
      follows:

     

    (a)      
      Organization;
      Authority.
      If the Purchaser is not an individual: (i) such Purchaser is an entity duly
      organized, validly existing and in good standing under the laws of the
      jurisdiction of its organization with full right, corporate, limited liability
      company or partnership power and authority to enter into and to consummate
      the
      transactions contemplated by this Agreement and otherwise to carry out its
      obligations hereunder; (ii) the execution, delivery and performance by such
      Purchaser of this Agreement have been duly authorized by all necessary
      corporate, limited liability company, partnership or similar action on the
      part
      of such Purchaser; (iii) this Agreement has been duly executed by such
      Purchaser, and when delivered by such Purchaser in accordance with the terms
      hereof, will constitute the valid and legally binding obligation of such
      Purchaser, enforceable against it in accordance with its terms, except (1)
      as
      limited by general equitable principles and applicable bankruptcy, insolvency,
      reorganization, moratorium and other laws of general application affecting
      enforcement of creditors’ rights generally, (2) as limited by laws relating to
      the availability of specific performance, injunctive relief or other equitable
      remedies and (3) insofar as indemnification and contribution provisions may
      be
      limited by applicable law. If the Purchaser is an individual: (i) the Purchaser
      and any spouse of the Purchaser have the legal capacity to enter into this
      Agreement; (ii) the Agreement has been duly executed by the Purchaser and any
      spouse of the Purchaser; (iii) this Agreement has been duly executed by such
      Purchaser, and when delivered by such Purchaser in accordance with the terms
      hereof, will constitute the valid and legally binding obligation of such
      Purchaser, enforceable against it in accordance with its terms, except (1)
      as
      limited by general equitable principles and applicable bankruptcy, insolvency,
      reorganization, moratorium and other laws of general application affecting
      enforcement of creditors’ rights generally, (2) as limited by laws relating to
      the availability of specific performance, injunctive relief or other equitable
      remedies and (3) insofar as indemnification and contribution provisions may
      be
      limited by applicable law.

     

    (b)      
      Distribution.
      Such Purchaser does not have any agreement or understanding, directly or
      indirectly, with any Person to distribute any of the Shares, Warrants or Warrant
      Shares. Such Purchaser is not required to be registered as a broker-dealer
      under
      Section 15 of the Exchange Act. 

     

    (c)      
      Purchaser
      Status.
      The Purchaser is either (i) a Qualified Institutional Buyer within the meaning
      of Rule 144A under the Securities Act, (ii) an “accredited investor” as defined
      in Rule 501(a) under the Securities Act or (iii) is organized in a non-United
      States jurisdiction.

     

    (d)      
      No
      Trading.
      Each Purchaser represents and warrants that, except as otherwise disclosed
      to
      the Company in writing, from January 23, 2006 (the
      “Discussion 

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    Time”), up
      through the execution of this Agreement, the Purchaser did not, directly or
      indirectly, execute any Short Sales or engage in any other trading in the Common
      Stock or any derivative security thereof.

     

    The
      Company acknowledges and agrees that each Purchaser does not make or has not
      made any representations or warranties with respect to the transactions
      contemplated hereby other than those specifically set forth in this Section
      3.2.

     

    ARTICLE
      IV.

    OTHER
      AGREEMENTS OF THE PARTIES

     

    4.1      
      Securities
      Laws Disclosure; Publicity. The Company shall, by 8:30 a.m., Eastern time,
      on the second Trading Day following the date hereof, issue a press release
      and
      file a Current Report on Form 8-K which attaches as exhibits all agreements
      relating to this transaction, including but not limited to, this Agreement
      and
      the form of Warrant, in each case reasonably acceptable to counsel to the
      Purchasers, disclosing the material terms of the transactions contemplated
      hereby, and shall file the prospectus supplement delivered by the Company in
      connection herewith with the Commission via the EDGAR system on a timely basis.
      Notwithstanding the foregoing, the Company shall not publicly disclose the
      name
      of any Purchaser, or include the name of any Purchaser in any filing with the
      Commission or any regulatory agency or Trading Market, except as set forth
      in
      the exhibits to be attached to the Form 8-K contemplated above, without the
      prior written consent of such Purchaser (such consent not to be unreasonably
      withheld), except (i) as required by federal securities law and (ii) to the
      extent such disclosure is required by law or Trading Market regulations, in
      which case the Company shall provide the Purchasers with prior notice of such
      disclosure permitted under subclause (i) or (ii).

     

    4.2      
      Non-Public
      Information. The Company covenants and agrees that neither it nor any other
      Person acting on its behalf will provide any Purchaser or its agents or counsel
      with any information that the Company believes constitutes material non-public
      information, unless prior thereto such Purchaser shall have executed a written
      agreement regarding the confidentiality and use of such information. The Company
      understands and confirms that each Purchaser shall be relying on the foregoing
      representations in effecting transactions in securities of the
      Company.

     

    4.3      
      Indemnification
      of Purchasers. Subject to the provisions of this Section 4.3, the Company
      will indemnify and hold the Purchasers and their directors, officers,
      stockholders, partners, members, employees and agents (each, a “Purchaser
      Party”) harmless from any and all losses, liabilities, obligations, claims,
      contingencies, damages, costs and expenses, including all judgments, amounts
      paid in settlements, court costs and reasonable attorneys’ fees and costs of
      investigation that any such Purchaser Party may suffer or incur (the
“Indemnified Liabilities”) as a result of or relating to (a) any material breach
      of any of the representations, warranties, covenants or agreements made by
      the
      Company in this Agreement or in the other Transaction Documents or (b) any
      Action brought or made against such Purchaser Party by a third party (including
      for these purposes a derivative action brought on behalf of the Company) and
      arising out of or resulting from (i) the execution, delivery, performance or
      enforcement of the Transaction Documents or any other certificate, instrument
      or
      document contemplated hereby or thereby, (ii) any transaction financed or to
      be
      financed in whole or in part, directly or indirectly, 

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    with
      the proceeds of the issuance of the Shares, or (iii) the status of such
      Purchaser or holder of the Shares as an investor in the Company. The Company
      shall not be liable to any Purchaser under this provision in respect of any
      Indemnified Liability if such liability arises out of any misrepresentation
      by
      the Purchaser in Section 3.2 of this Agreement. To the extent that the foregoing
      undertaking by the Company may be unenforceable for any reason, the Company
      shall make the maximum contribution to the payment and satisfaction of each
      of
      the Indemnified Liabilities which is permissible under applicable law If any
      action shall be brought against any Purchaser Party in respect of which
      indemnity may be sought pursuant to this Agreement, such Purchaser Party shall
      promptly notify the Company in writing, and the Company shall have the right
      to
      assume the defense thereof with counsel of its own choosing. Any Purchaser
      Party
      shall have the right to employ separate counsel in any such action and
      participate in the defense thereof, but the fees and expenses of such counsel
      shall be at the expense of such Purchaser Party except to the extent that (i)
      the employment thereof has been specifically authorized by the Company in
      writing, (ii) the Company has failed after a reasonable period of time to assume
      such defense and to employ counsel or (iii) in such action there is, in the
      reasonable opinion of such separate counsel, a material conflict on any material
      issue between the position of the Company and the position of such Purchaser
      Party. The Company will not be liable to any Purchaser Party under this Section
      4.3 for any settlement by a Purchaser Party effected without the Company’s prior
      written consent, which shall not be unreasonably withheld or
      delayed. 

     

    4.4      
      Reservation
      and Listing
      of Common Stock. The
      Company shall promptly secure the listing of all of the Shares and the Warrant
      Shares upon each national securities exchange and automated quotation system,
      if
      any, upon which the Common Stock is then listed or quoted. The Company hereby
      agrees to use commercially reasonable efforts to maintain the listing of the
      Shares and the Warrant Shares on a Trading Market. The Company further agrees,
      if the Company applies to have the Common Stock traded on any other Trading
      Market, it will include in such application all of the Shares and the Warrant
      Shares and will take such other action as is necessary to cause all of the
      Shares and the Warrant Shares to be listed on such other Trading Market as
      promptly as possible. The Company will take all action reasonably necessary
      to
      continue the listing and trading of its Common Stock on a Trading Market and
      will comply in all respects with the Company’s reporting, filing and other
      obligations under the bylaws or rules of the Trading Market.

     

    4.5      Equal
      Treatment of Purchasers. No consideration shall be offered or paid to any
      person to amend or consent to a waiver or modification of any provision of
      any
      of the Transaction Documents unless the same consideration is also offered
      to
      all of the parties to the Transaction Documents. For clarification purposes,
      this provision constitutes a separate right granted to each Purchaser by the
      Company and negotiated separately by each Purchaser, and is intended to treat
      for the Company the Purchasers as a class and shall not in any way be construed
      as the Purchasers acting in concert or as a group with respect to the purchase,
      disposition or voting of Shares or otherwise.

     

    4.6      
      Approval
      of Subsequent Equity Sales. The Company shall not issue shares of Common
      Stock or Common Stock Equivalents if such issuance would require stockholder
      approval of the transactions contemplated by the Transaction Documents pursuant
      to Rule 4350 of the NASD Marketplace Rules or any similar rule of any other
      Trading Market, unless and until such shareholder approval is obtained prior
      to
      such issuance.

     

    
      
        
        

      

      
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    4.7      
      Trading
      Limitations and Restrictions on Short Sales. Each Purchaser represents,
      warrants, covenants and agrees that from the Discussion Time through the date
      hereof, such Purchaser did not, and (b) from the date hereof until the date
      the
transactions
      contemplated by this Agreement are first publicly announced by the Company
      as
      described in Section 4.1,
      such Purchaser will not, directly or indirectly, trade in the Common Stock
      or
      execute or effect (or cause to be executed or effected) any Short Sale or in
      the
      Common Stock. Furthermore, for the time period set forth in clause (b) above,
      the Purchaser will not directly or indirectly sell, offer to sell, solicit
      offers to buy, dispose of, loan, pledge or grant any right with respect to
      shares of Common Stock, except in compliance with all relevant securities laws
      and regulations.

     

    Notwithstanding
      the foregoing, no Purchaser makes any representation, warranty or covenant
      hereby that it will not engage in Short Sales in the securities of the Company
      after the time that the transactions contemplated by this Agreement are first
      publicly announced by the Company as described in Section 4.1.

     

    


     

    ARTICLE
      V.

    MISCELLANEOUS

     

    5.1      
      Fees
      and Expenses. Except as otherwise set forth in this Agreement, each party
      shall pay the fees and expenses of its advisers, counsel, accountants and other
      experts, if any, and all other expenses incurred by such party incident to
      the
      negotiation, preparation, execution, delivery and performance of this Agreement.
      The Company shall pay all stamp and other taxes and duties levied in connection
      with the sale of the Shares.

     

    5.2      
      Entire
      Agreement. The Transaction Documents, together with the exhibits and
      schedules thereto, contain the entire understanding of the parties with respect
      to the subject matter hereof and supersede all prior agreements and
      understandings, oral or written, with respect to such matters, which the parties
      acknowledge have been merged into such documents, exhibits and
      schedules.

     

    5.3      
      Notices.
      Any and all notices or other communications or deliveries required or permitted
      to be provided hereunder shall be in writing and shall be deemed given and
      effective on the earliest of (a) the date of transmission, if such notice or
      communication is delivered via facsimile at the facsimile number set forth
      on
      the signature pages attached hereto prior to 6:30 p.m. (New York City time)
      on a
      Trading Day, (b) the next Trading Day after the date of transmission, if such
      notice or communication is delivered via facsimile at the facsimile number
      set
      forth on the signature pages attached hereto on a day that is not a Trading
      Day
      or later than 6:30 p.m. (New York City time) on any Trading Day, (c) the second
      Trading Day following the date of mailing, if sent by U.S. nationally recognized
      overnight courier service, or (d) upon actual receipt by the party to whom
      such
      notice is required to be given. The address for such notices and communications
      shall be as set forth on the signature pages attached hereto.

     

    5.4      
      Amendments;
      Waivers. No provision of this Agreement may be waived or amended except in a
      written instrument signed, in the case of an amendment, by the Company and
      each
      Purchaser or, in the case of a waiver, by the party against whom enforcement
      of
      any 

     

    
      
        
        

      

      
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    such
      waiver is sought. No waiver of any default with respect to any provision,
      condition or requirement of this Agreement shall be deemed to be a continuing
      waiver in the future or a waiver of any subsequent default or a waiver of any
      other provision, condition or requirement hereof, nor shall any delay or
      omission of either party to exercise any right hereunder in any manner impair
      the exercise of any such right.

     

    5.5      
      Construction.
      The headings herein are for convenience only, do not constitute a part of this
      Agreement and shall not be deemed to limit or affect any of the provisions
      hereof. The language used in this Agreement will be deemed to be the language
      chosen by the parties to express their mutual intent, and no rules of strict
      construction will be applied against any party.

     

    5.6      
      Successors
      and Assigns.
      This Agreement shall be binding upon and inure to the benefit of the parties
      and
      their successors and permitted assigns. The Company may not assign this
      Agreement or any rights or obligations hereunder without the prior written
      consent of each Purchaser. Any Purchaser may assign any or all of its rights
      under this Agreement to any Person to whom such Purchaser assigns or transfers
      any Shares, provided such transferee agrees in writing to be bound, with respect
      to the transferred Shares, by the provisions hereof that apply to the
“Purchasers”.

     

    5.7      
      No
      Third-Party Beneficiaries. This Agreement is intended for the benefit of the
      parties hereto and their respective successors and permitted assigns and is
      not
      for the benefit of, nor may any provision hereof be enforced by, any other
      Person, except as otherwise set forth in Section 4.6.

     

    5.8      
      Governing
      Law. All questions concerning the construction, validity, enforcement and
      interpretation of the Transaction Documents shall be governed by and construed
      and enforced in accordance with the internal laws of the State of New York,
      without regard to the principles of conflicts of law thereof. Each party hereby
      irrevocably submits to the exclusive jurisdiction of the state and federal
      courts sitting in The City of New York, Borough of Manhattan for the
      adjudication of any dispute hereunder or in connection herewith or with any
      transaction contemplated hereby or discussed herein (including with respect
      to
      the enforcement of any of the Transaction Documents), and hereby irrevocably
      waives, and agrees not to assert in any suit, action or proceeding, any claim
      that it is not personally subject to the jurisdiction of any such court, that
      such suit, action or proceeding is improper or inconvenient venue for such
      proceeding. Each party hereby irrevocably waives personal service of process
      and
      consents to process being served in any such suit, action or proceeding by
      mailing a copy thereof via registered or certified mail or overnight delivery
      (with evidence of delivery) to such party at the address in effect for notices
      to it under this Agreement and agrees that such service shall constitute good
      and sufficient service of process and notice thereof. Nothing contained herein
      shall be deemed to limit in any way any right to serve process in any manner
      permitted by law. The
      parties hereby waive all rights to a trial by jury. If
      either party shall commence an action or proceeding to enforce any provisions
      of
      the Transaction Documents, then the prevailing party in such action or
      proceeding shall be reimbursed by the other party for its attorneys’ fees and
      other costs and expenses incurred with the investigation, preparation and
      prosecution of such action or proceeding.

     

    
      
        
        

      

      
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    5.9      
      Survival.
      The representations, warranties, covenants and agreements contained herein
      shall
      survive the Closing and delivery of the Shares and the Warrants and any exercise
      of the Warrants through the exercise or expiration of the Warrants.

     

    5.10      Execution.
      This Agreement may be executed in two or more counterparts, all of which when
      taken together shall be considered one and the same agreement and shall become
      effective when counterparts have been signed by each party and delivered to
      the
      other party, it being understood that both parties need not sign the same
      counterpart. In the event that any signature is delivered by facsimile
      transmission, such signature shall create a valid and binding obligation of
      the
      party executing (or on whose behalf such signature is executed) with the same
      force and effect as if such facsimile signature page were an original
      thereof.

     

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

     

    5.12      Rescission
      and Withdrawal Right. Notwithstanding anything to the contrary contained in
      (and without limiting any similar provisions of) the Transaction Documents,
      whenever any Purchaser exercises a right, election, demand or option under
      a
      Transaction Document and the Company does not timely perform its related
      obligations within the periods therein provided, then such Purchaser may rescind
      or withdraw, in its sole discretion from time to time upon written notice to
      the
      Company, any relevant notice, demand or election in whole or in part without
      prejudice to its future actions and rights.

     

    5.13      Replacement
      of Shares. If any certificate or instrument evidencing any Shares is
      mutilated, lost, stolen or destroyed, the Company shall issue or cause to be
      issued in exchange and substitution for and upon cancellation thereof, or in
      lieu of and substitution therefor, a new certificate or instrument, but only
      upon receipt of evidence reasonably satisfactory to the Company of such loss,
      theft or destruction and customary and reasonable indemnity, if requested.
      The
      applicants for a new certificate or instrument under such circumstances shall
      also pay any reasonable third-party costs associated with the issuance of such
      replacement Shares.

     

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

     

    5.15      Independent
      Nature of Purchasers’ Obligations and Rights. The obligations of each
      Purchaser under any Transaction Document are several and not joint with the
      obligations of any other Purchaser, and no Purchaser shall be responsible in
      any
      way for the performance of the obligations of any other Purchaser under any
      Transaction Document. Nothing contained herein or in any Transaction Document,
      and no action taken by any Purchaser pursuant thereto, shall be 

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

     

    deemed
      to constitute the Purchasers as a partnership, an association, a joint venture
      or any other kind of entity, or create a presumption that the Purchasers are
      in
      any way acting in concert or as a group with respect to such obligations or
      the
      transactions contemplated by the Transaction Document. Each Purchaser shall
      be
      entitled to independently protect and enforce its rights, including, without
      limitation, the rights arising out of this Agreement or out of the other
      Transaction Documents, and it shall not be necessary for any other Purchaser
      to
      be joined as an additional party in any proceeding for such purpose. Each
      Purchaser has been represented by its own separate legal counsel in their review
      and negotiation of the Transaction Documents. The Company has elected to provide
      all Purchasers with the same terms and Transaction Documents for the convenience
      of the Company and not because it was required or requested to do so by the
      Purchasers.

     

    5.16      Acknowledgment
      Regarding RBC. Each Purchaser acknowledges that RBC is acting as a placement
      agent for the Shares being offered hereby and will be compensated by the Company
      for acting in such capacity. Each Purchaser further acknowledges that RBC has
      acted solely as agent of the Company in connection with the offering of the
      Shares by the Company. Each Purchaser further acknowledges that the provisions
      of Sections 2.3(b)(vi) and 5.16 are for the benefit of and may be enforced
      by
      RBC.

     

     

    (Signature
      Page Follows)

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    


    IN
      WITNESS WHEREOF, the parties hereto have caused this
      Agreement to be duly executed by their respective authorized signatories
      as of the date first indicated above.

     

     

    
      	
              Company
                : RegeneRx Biopharmaceuticals, Inc.

               

            	
              Address
                for Notice:

            
	
              By:
                ______________________

              Name:
                

              Title:
                

            	
              3
                Bethesda Metro Center

              Bethesda,
                Maryland 20814

              Attn:
                

              Fax:

            
	
               

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

               

              Patton
                Boggs LLP 

              2550
                M Street, NW 

              Washington,
                D.C. 20037 

              Attn:
                Philip G. Feigen

              Fax:
                (202) 457-6315

            	 


    

     

     

    [REMAINDER
      OF PAGE INTENTIONALLY LEFT BLANK

    SIGNATURE
      PAGES FOR PURCHASERS FOLLOW]

     

    
      
        
        

      

      
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    [NON-INDIVIDUAL
      PURCHASER SIGNATURE PAGES 

    TO
      RGN SECURITIES PURCHASE AGREEMENT]

    


    IN
      WITNESS WHEREOF, the undersigned have caused this Securities Purchase Agreement
      to be duly executed by their respective authorized signatories as of the date
      first indicated above.

     

    Name
      of Purchasing Entity: 

    Signature
      of Authorized Signatory of Investing Entity:
      

    Name
      of Authorized Signatory: 

    Title
      of Authorized Signatory: 

    Email
      Address of Authorized Entity:

    Fax:

    


    Address
      for Notice of Purchasing Entity:

    
 

     

     

    DWAC
      Instructions for Common Stock:

    


    


    Subscription
      Amount: $

     

    


    [SIGNATURE
      PAGES CONTINUE]

    


    
      
        
        

      

      
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    [INDIVIDUAL
      PURCHASER SIGNATURE PAGES 

    TO
      RGN SECURITIES PURCHASE AGREEMENT]

    


    IN
      WITNESS WHEREOF, the undersigned have caused this Securities Purchase Agreement
      to be duly executed by their respective authorized signatories as of the date
      first indicated above.

     

    Name
      of Purchaser: 

    Signature
      of Person:
      

    Email
      Address of Purchasing:

    Fax:

    


    Address
      for Notice of Purchaser:

    


    


    DWAC
      Instructions for Common Stock:

    


    


    


    Subscription
      Amount: $

    


    


    CONSENT
      OF SPOUSE

     

    The
      undersigned spouse of the Purchaser acknowledges on his or her own behalf that
      (i) the undersigned is the spouse of the Purchaser, (ii) the undersigned has
      read and understands the foregoing Securities Purchase Agreement, (iii) the
      undersigned shall take no action at any time to hinder operation of the
      Agreement on the Shares or the undersigned’s interest therein, and (iv) the
      undersigned appoints the Purchaser as the undersigned’s attorney-in-fact with
      respect to any amendment of, or exercise of any rights under, the Agreement.
      Executed Effective as of the date of the Securities Purchase
      Agreement.

     

    
      	 	 	 
	 	 	Signature of Spouse
	 	 	 
	 	 	 
	 	 	Name of Spouse


    

     

     

     

    SIGN
      ABOVE OR BELOW AS APPLICABLE

     

    The
      Purchaser hereby certifies that the Purchaser is not legally married as of
      the
      date of this Agreement.

     

    
      	 	 	 
	 	 	
              Signature of Purchaser

            


    

     

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
      A

    


    WARRANT

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
      B

    


    FORM
      OF OPINION OF COUNSEL FOR THE COMPANY

    


    The
      opinion of Patton Boggs LLP, counsel for the Company (capitalized terms used
      herein and not otherwise defined in such opinion shall have the meanings
      provided in the Agreement, to which this is an Exhibit), to be delivered
      pursuant to Section 2.2(a)(iv) of the Agreement shall be to the effect
      that:

    


    1.      
      The
      Company is validly existing as a corporation in good standing under the laws
      of
      the State of Delaware. The Company is duly qualified to transact business and
      is
      in good standing as a foreign corporation in each jurisdiction listed on
      Schedule I hereto (in rendering such opinion, such counsel may state that its
      opinion that the Company is qualified to do business is based solely upon
      certificates provided by agencies of those states and is limited to the meaning
      ascribed to such certificates by such applicable state agency).

     

    2.      
      The
      Company has all requisite corporate power and authority to own, lease and
      operate its properties and to conduct its business as now being conducted and
      as
      described in the Registration Statement and the documents incorporated therein
      by reference (the “Incorporated
      Documents”)
      and to enter into and perform its obligations under the Agreement.

     

    3.      
      The
      authorized capital stock of the Company is as set forth in the Annual Report
      on
      Form 10-KSB for the year ended December 31, 2004 (the “Form
      10-KSB”)
      and, since such date, there has been no change in the authorized capital stock
      of the Company. All of the shares of capital stock of the Company outstanding
      immediately prior to the issuance of the Shares, and the Shares and the
      Warrants, have been duly authorized. All of the shares of capital stock of
      the
      Company outstanding immediately prior to the issuance of the Shares are (and
      the
      Shares upon issuance and payment therefor in accordance with the Agreement
      and
      the Warrants, as applicable will be, ) validly issued, fully paid and
      nonassessable, and none of such shares of the Company’s capital stock were (or
      in the case of the Shares will be) issued in violation of any preemptive or
      other similar right under the Delaware General Corporation Law (the
“DGCL”),
      the certificate of incorporation or bylaws of the Company, each as amended
      to
      date (together the “Charter
      Documents”)
      or, to our knowledge, any other contract, agreement or instrument to
      which the Company is a party. At the time the Registration Statement was filed
      with the SEC, the
      Company was
      eligible to register the Shares issued in connection with the offering and
      sale
      of the Shares contemplated by the Agreement (the “Offering”)
      using a registration statement on Form S-3 promulgated under the Securities
      Act,
      and as of the date hereof, remains eligible to use the Form S-3 Registration
      Statement.
      To our knowledge, except as disclosed in the Registration Statement or in the
      Incorporated Documents, there are no restrictions upon the voting or transfer
      of
      any securities of the Company pursuant to the Charter Documents or any agreement
      or instrument included as an exhibit to the Registration Statement or the
      Incorporated Documents. To our knowledge, and based solely on a review of the
      books and records of the Company, except as set forth in Registration Statement
      or in the Incorporated Documents, there are no outstanding securities of the
      Company convertible into or evidencing the right to purchase or subscribe


     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    for
      any shares of capital stock of the Company, and there are no outstanding
      options, warrants or other instruments or agreements obligating the Company
      to
      issue any shares of its capital stock or any securities convertible into or
      evidencing the right to purchase or subscribe for any shares of such stock.
      The
      Shares conform as to legal matters in all material respects to the descriptions
      thereof contained in the Registration Statement. The form of certificate used
      to
      evidence the Shares complies in all material respects with the requirements
      of
      the DGCL, with any applicable requirements of the Charter Documents and the
      requirements of the American Stock Exchange.

     

    4.      
      All
      necessary corporate action has been duly and validly taken by the Company to
      authorize the execution, delivery and performance of the Agreement. The
      Agreement has been duly executed and delivered by the Company.

     

     

    5.      
      Other
      than consents and/or waivers already obtained pursuant to the Rights Agreement,
      dated April 29, 1999, as amended, between the Company and American Stock
      Transfer & Trust Company, as Rights Agent, neither the
      execution, delivery and performance of the Agreement by the Company nor the
      execution, delivery or performance of any other agreement or instrument entered
      into or to be entered into by the Company in connection with the transactions
      contemplated by the Agreement will give rise to a right to terminate or
      accelerate the due date of any payment due under, or conflict with or result
      in
      the breach of any term or provision of, or constitute a default (or any event
      which with notice or lapse of time, or both, would constitute a default) under,
      or require consent or waiver under, or result in the execution or imposition
      of
      any lien, charge, claim, security interest or encumbrance upon any properties
      or
      assets of the Company pursuant to the terms of any contract, agreement or other
      instrument filed as an exhibit to or described in the Registration Statement
      or
      the Incorporated Documents or any material contract, agreement or instrument
      to
      which the Company is a party and is known to us or violate any provision of
      the
      Charter Documents.

     

    6.      
      No
      consent, approval, authorization, or order of or filing with any federal, New
      York state or Delaware state governmental authority or to our knowledge, any
      federal, New York state or Delaware state court is required for the Company’s
      execution, delivery or performance of the Agreement, other than (a) those that
      have been obtained under the Securities Act, the Exchange Act or the rules
      of
      the American Stock Exchange or the National Association of Securities Dealers,
      Inc., and (b) those under state securities or blue sky laws (as to which we
      express no opinion).

     

    7.      
      To
      our knowledge, there is no action, suit, proceeding or other investigation
      or
      inquiry, before any court or before or by any public body or board pending
      or
      threatened against or involving the Company which is required to be disclosed
      in
      the Registration Statement or in the Incorporated Documents and is not so
      disclosed and which could reasonably be expected to have a Material Adverse
      Effect.

     

    8.      
      The
      statements in the Registration Statement under the caption “Description of
      Common Stock,” “Description of Warrants,” and the statements in the Form 10-KSB
      under the caption “Description of Business—Legal Proceedings,” and in the
      Registration Statement under Item 14 of Part II insofar as such statements
      purport to constitute summaries of legal matters, agreements or documents
      referred to therein, fairly summarize the matters, agreements, documents or
      proceedings described therein in all material respects. To our knowledge, there
      are no contracts, licenses, agreements, leases or documents of a character
      which
      are required to be filed as exhibits to the Registration Statement or the
      Incorporated 

     

    
      
        
        

      

      
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    Documents
      or to be summarized or described therein which are not so filed, summarized
      or
      described, as applicable.

     

    9.      
      The
      Registration Statement and each amendment or supplement thereto filed prior
      to
      or on the date hereof, as of their respective dates (except for the financial
      statements, notes and schedules and other financial and accounting data included
      therein, as to which such counsel expresses no opinion) comply as to form in
      all
      material respects with the applicable requirements of the Securities Act and
      the
      rules promulgated thereunder.

     

    10.      Based
      solely upon the telephonic advice received from such counsel from the
      Commission, the Registration Statement has been declared effective by the
      Commission under the Securities Act, and to our knowledge, based solely on
      a
      telephone conversation with the Commission, such counsel is not aware of any
      stop order suspending the effectiveness of the Registration Statement. Any
      required filing of the Prospectus and any supplement thereto pursuant to Rule
      424(b) under the Securities Act in connection with the Offering has been made
      in
      the manner and within the time period required by such Rule 424(b).

     

    11.      To
      such counsel’s knowledge, no person or entity has the right, as a result of the
      filing or effectiveness of the Registration Statement or the Offering, pursuant
      to the terms of any material contract, agreement or instrument to which the
      Company is a party or any contract, agreement or other instrument filed as
      an
      exhibit to or described in the Registration Statement or the Incorporated
      Documents, to have any securities issued by the Company and owned by such person
      or entity registered pursuant to the Securities Act and included in the
      Registration Statement or sold in the Offering, except for such rights as such
      counsel has been advised by the Company in an officer’s certificate, have been
      complied with or waived.

     

    12.      The
      Company is not and, immediately before and after giving effect to the Offering,
      will not be an “investment company” within the meaning of the Investment Company
      Act of 1940, as amended.

     

    In
      connection with the preparation of the Registration Statement, we have
      participated in conferences with directors, officers and other representatives
      of the Company, representatives of the Placement Agent, counsel for the
      Placement Agent, representatives of the Purchaser, counsel for the Purchaser
      and
      representatives of Reznick Group, P.C., the Company’s independent certified
      public accountants, at which conferences the contents of the Registration
      Statement and related matters were discussed and, although we have not
      independently verified and are not passing upon and do not assume any
      responsibility, explicitly or implicitly, for the accuracy, completeness or
      fairness of the statements contained in the Registration Statement (except
      as to
      the extent stated, but only to the extent expressly stated, in the first,
      fourth, fifth, sixth and seventh sentences of paragraph 3 or the first sentence
      of paragraph 8 set forth above), on the basis of the foregoing, relying as
      to
      materiality to a large extent on the representations of officers and other
      representatives of the Company, no facts have come to our attention which lead
      us to believe that the Registration Statement at the time such Registration
      Statement became effective contained an untrue statement of a material fact
      or
      omitted to state a material fact required to be stated therein or necessary
      to
      make the statements therein not misleading, or that the Registration Statement
      contained or contains an untrue statement of a material fact or omitted or
      omits
      to state a material fact required to be stated therein or necessary to make
      the
      statements 

     

    
      
        
        

      

      
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    therein,
      in the light of the circumstances under which they were made, not misleading
      (it
      being understood that we express no view with respect to (a) the financial
      statements, notes and schedules, (b) the other financial and accounting data
      or
      (c) information pertaining to the interpretation and application of accounting
      standards and rules in the Registration Statement).

     

     28