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     The Holder agrees with the Company that this Warrant is issued, and all the rights hereundershall be held subject to, all of the conditions, limitations and provisions set forth herein.     1.     Exercise of Warrant.          (a)     In accordance with the procedures set forth in Section 1(b) below, this Warrant willbecome exercisable with respect to all of the Subject Shares on the date that is six months and oneday following the Effective Date (the “First Exercise Date”). Subject to the foregoingexercise schedule, the Holder may exercise this Warrant, at any time, or from time to time, untilthe third year anniversary of the Effective Date (the “Expiration Date”).          (b)     During the period that this Warrant is exercisable in accordance with Sections 1(a), theHolder may exercise this Warrant, in whole or in part, by presentation and surrender of thisWarrant to the Company at its principal office, or at the office of its stock transfer agent, ifany, together with the Warrant Exercise Form, attached hereto as Exhibit A, duly executed,accompanied by payment (either in cash or by certified or official bank check, payable to the orderof the Company) of the Exercise Price for the number of shares specified in such form andinstruments of transfer, if appropriate, duly executed by the Holder or his, her or its dulyauthorized attorney. If this Warrant should be exercised in part only, the Company shall, uponsurrender of this Warrant for cancellation, execute and deliver a new Warrant evidencing the rightsof the Holder thereof to purchase the balance of the shares purchasable hereunder. Upon receipt bythe Company of this Warrant, together with a duly executed Warrant Exercise Form and the ExercisePrice, at its office, or by the stock transfer agent of the Company at its office, in proper formfor exercise, the Holder shall, subject to compliance with any applicable securities laws, bedeemed 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 thatcertificates representing such shares of Common Stock shall not then be actually delivered to theHolder.     2.     Reservation of Shares. The Company covenants that during the term this Warrant isexercisable, the Company will reserve from its authorized and unissued Common Stock a sufficientnumber 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 ofIncorporation to provide sufficient reserves of shares of Common Stock issuable upon exercise ofthe Warrant.     3.     Fractional Shares. No fractional shares or scrip representing fractional sharesshall be issued upon the exercise of this Warrant, but the Company shall issue one additional shareof its Common Stock or Other Securities (as applicable) in lieu of each fraction of a shareotherwise called for upon exercise of this Warrant.     4.     Transfer of Warrant.          (a)     Subject to compliance with any applicable federal and state securities laws and theconditions set forth in Sections 4(b) below, this Warrant may be transferred by the Holder withrespect to any or all of the shares purchasable hereunder at any time after the First ExerciseDate. No transfer of this Warrant shall be permitted on or before the First Exercise Date. Uponsurrender 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 B duly executed, theTransferor Representation Letter (as defined below) duly executed, the Transferee RepresentationLetter (as defined below) duly executed and funds sufficient to pay any transfer tax, the Companyshall execute and deliver a new Warrant or Warrants in the name of the
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assignee or assignees and in the denomination or denominations specified in the AssignmentForm and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not soassigned. Thereafter, this Warrant shall promptly be cancelled. This Warrant may be divided orcombined with other Warrants that carry the same rights upon presentation hereof at the office ofthe Company or at the office of its stock transfer agent, if any, together with a written noticespecifying the names and denominations in which new Warrants are to be issued and signed by theHolder hereof. Notwithstanding the foregoing, the Company shall not be required to issue a Warrantcovering less than 1,000 shares of Common Stock.          (b)     Notwithstanding anything to the contrary set forth herein, no transfer of all or anyportion of this Warrant shall be made except for transfers to the Company, unless the Holder andthe proposed transferee each truthfully certify and provide to the Company a written representationletter (the “Transferor Representation Letter” and the “Transferee RepresentationLetter”, respectively) that such transfer is to a person that is an “accredited investor”within the meaning of Regulation D under the Securities Act.     5.     Anti-Dilution Provisions.          5.1     Adjustment for Dividends in Other Securities, Property, Etc. In case at any timeor from time to time after the Base Date the shareholders of the Company shall have received, or onor after the record date fixed for the determination of eligible shareholders, shall have becomeentitled to receive without payment therefor: (a) other or additional securities or property (otherthan 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 suchcase, the Holder of this Warrant, upon the exercise thereof as provided in Section 1, shall beentitled to receive the amount of securities and property (including cash in the cases referred toin clauses (b) and (c) above) which such Holder would hold on the date of such exercise if on theBase Date it had been the holder of record of the number of shares of Common Stock or OtherSecurities (as applicable) as constituted on the Base Date subscribed for upon such exercise asprovided in Section 1 and had thereafter, during the period from the Base Date to and including thedate of such exercise, retained such shares and/or all other additional (or less) securities andproperty (including cash in the cases referred to in clauses (b) and (c) above) receivable by it asaforesaid during such period, giving effect to all adjustments called for during such period bythis Section 5.1 and Sections 5.2 and 5.3 below.          5.2     Adjustment for Recapitalization. If the Company shall at any time subdivide itsoutstanding shares of Common Stock (or Other Securities at the time receivable upon the exercise ofthe 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 OtherSecurities, as the case may be) subject to this Warrant immediately prior to such subdivision shallbe proportionately increased and the Exercise Price shall be proportionately decreased, and if theCompany shall at any time combine the outstanding shares of Common Stock, the number of shares ofCommon Stock or Other Securities subject to this Warrant immediately prior to such combinationshall be proportionately decreased and the Exercise Price shall be proportionately increased. Anysuch adjustments pursuant to this Section 5.2 shall be effective at the close of business on theeffective date of such subdivision or combination or if any adjustment is the result of a stockdividend or distribution then the effective date for such adjustment based thereon shall be therecord date therefor.
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          5.3     Adjustment for Reorganization, Consolidation, Merger, Etc. In case of anyreorganization of the Company (or any other entity, the securities of which are at the timereceivable on the exercise of this Warrant) after the Base Date or in case after such date theCompany (or any such other entity) shall consolidate with or merge into another corporation orconvey 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 theconsummation of such reorganization, consolidation, merger or conveyance, shall be entitled toreceive, in lieu of the securities and property receivable upon the exercise of this Warrant priorto such consummation, the securities or property to which such Holder would have been entitled uponsuch consummation if such Holder had exercised this Warrant immediately prior thereto; in each suchcase, the terms of this Warrant shall be applicable to the securities or property receivable uponthe exercise of this Warrant after such consummation.          5.4     No Impairment. The Company will not, by amendment of its Articles of Incorporationor through reorganization, consolidation, merger, dissolution, issue or sale of securities, sale ofassets or any other voluntary action, avoid or seek to avoid the observance or performance of anyof the terms of this Warrant, but will at all times in good faith assist in the carrying out of allsuch terms and in the taking of all such action as may be necessary or appropriate in order toprotect the rights of the Holder of this Warrant against impairment. Without limiting thegenerality of the foregoing, while this Warrant is outstanding, the Company will take all suchaction as may be necessary or appropriate in order that the Company may validly and legally issueor 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 ofshares of Warrant Stock or Other Securities receivable on the exercise of this Warrant, the Companyat its expense will promptly compute such adjustment in accordance with the terms of this Warrantand prepare a certificate executed by an executive officer of the Company setting forth suchadjustment and showing in detail the facts upon which such adjustment is based. The Company willforthwith 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 atthe time receivable upon the exercise of the Warrant) for the purpose of entitling them to receiveany dividend (other than a cash dividend at the same rate as the rate of the last cash dividendtheretofore paid) or other distribution, or any right to subscribe for, purchase or otherwiseacquire 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 ofthe Company, any consolidation or merger of the Company with or into another corporation, or anyconveyance of all or substantially all of the assets of the Company to another corporation; or          (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 theWarrant at the time outstanding a notice specifying, as the case may be, (i) the date on which arecord is to be taken for the purpose of such dividend, distribution or right, and stating theamount and character of such dividend, distribution or right, or (ii) the date on which suchreorganization, reclassification, consolidation, merger, conveyance, dissolution, liquidation orwinding up is to take place, and the time, if any, which is to be fixed, as to which the holders ofrecord of Common Stock (or such other securities at
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the time receivable upon the exercise of the Warrant) shall be entitled to exchange their shares ofCommon Stock (or such other securities) for securities or other property deliverable upon suchreorganization, reclassification, consolidation, merger, conveyance, dissolution, liquidation orwinding up. Such notice shall be mailed at least twenty (20) days prior to the date thereinspecified 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 beenregistered under the Securities Act, upon exercise of any of the Warrants and the issuance of anyof the shares of Warrant Stock or Other Securities, all certificates representing such securitiesshall bear on the face thereof substantially the following legend:**“THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACTOF 1933, AS AMENDED (THE “****SECURITIES ACT****”) OR UNDER ANY STATE SECURITIESLAWS AND MAY NOT BE TRANSFERRED, SOLD, CONVEYED, PLEDGED, GIFTED, ASSIGNED,ENCUMBERED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT ANDANY APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AVAILABLE EXEMPTIONS FROMREGISTRATION FROM THE SECURITIES ACT AND THE RULES PROMULGATED THEREUNDER AND UNDERAPPLICABLE STATE SECURITIES LAWS, PROVIDED THAT THE INVESTOR DELIVERS TO THECOMPANY AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY CONFIRMING THEAVAILABILITY OF SUCH EXEMPTION. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIREDTO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.”**          7.     No Voting Rights as a Shareholder. This Warrant does not entitle the Holder to anyvoting rights or other rights as a shareholder of the Company.          8.     Notices. All notices, requests, demands, and other communications under thisAgreement shall be in writing and shall be deemed to have been duly given on the date of service ifserved personally on the party to whom notice is to be given, on the date of transmittal ofservices via facsimile or telecopy to the party to whom notice is to be given (if receipt is orallyconfirmed by phone and a confirming copy delivered thereafter in accordance with this Section), oron the fifth day after mailing if mailed to the party to whom notice is to be given, by first classmail, registered or certified, postage prepaid, or via a nationally recognized overnight courierproviding a receipt for delivery and properly addressed to the applicable address as set forth inSection 7.8 of the Subscription Agreement.          9.     Applicable Law. The Warrant is issued under and shall for all purposes be governedby and construed in accordance with the laws of the State of Florida, without giving effect to thechoice of law rules thereof.          10.     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 theCompany.
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          11.     Venue. The parties irrevocably submit to the exclusive jurisdiction of the courtsof Stateof Florida located in Miami-Dade County and federal courts of the United States for the SouthernDistrict of Florida in respect of the interpretation and of the provisions of this Agreement and inrespect of the transactions contemplated hereby.          12.     Waiver of Jury Trial**.**THE COMPANY AND THE HOLDER HEREBY WAIVE THEIR RESPECTIVERIGHTS TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING BASED UPON, OR RELATED TO, THE SUBJECT MATTEROF THIS AGREEMENT. THIS WAIVER IS KNOWINGLY, INTENTIONALLY AND VOLUNTARILY MADE BY THE HOLDER ANDTHE COMPANY.          13.     Payment of Certain Taxes and Charges. The Company shall not be required to issueor deliver any certificate for shares of Common Stock or other securities upon the exercise of thisWarrant or to register any transfer of this Warrant until any applicable transfer tax and any othertaxes or governmental charges that the Company may be required by law to collect in respect of suchexercise or transfer shall have been paid, such tax being payable by Holder at the time ofsurrender for the exercise or transfer.          14.     Register. The Company or its stock transfer agent, if any, will maintain aregister containing the name and address of the Holder of this Warrant and of the holders of otherwarrants of like tenor issued simultaneously hereunder. Any Holder may change its, his or heraddress 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 andshall not be bound to recognize any equitable or other claim to or interest in this Warrant on thepart of any other person.          15.     Specific Performance. The parties hereto acknowledge and agree that irreparabledamage would occur in the event that any of the provisions of this Warrant were not performed inaccordance with their specific terms or were otherwise breached. Accordingly, it is agreed thatthey shall be entitled to an injunction or injunctions to prevent breaches of the provisions ofthis Warrant and to enforce specifically the terms and provisions hereof in any court of competentjurisdiction in the United States or any state thereof, in addition to any other remedy to whichthey may be entitled at law or equity.
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     **IN WITNESS WHEREOF**, the Company has caused this Warrant to be signed on its behalf, in itscorporate name, by its duly authorized officer, all as of the day and year first above written.      **BIOHEART, INC.**