THE
SECURITIES REPRESENTED HEREBY AND ISSUABLE UPON CONVERSION HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE “ACT”) OR QUALIFIED UNDER
APPLICABLE STATE SECURITIES LAWS (THE “LAWS”) AND MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE ACT OR QUALIFICATION UNDER
THE LAWS UNLESS SUCH REGISTRATION AND QUALIFICATION IS NOT THEN REQUIRED UNDER
THE CIRCUMSTANCES OF SUCH OFFER, SALE, TRANSFER, PLEDGE OR
HYPOTHECATION.

     

    THESE
SECURITIES ARE SUBJECT TO AND TRANSFERABLE ONLY UPON COMPLIANCE WITH THE TERMS
AND CONDITIONS SET FORTH HEREIN.

    


    CONVERTIBLE PROMISSORY
NOTE

    


    
      
        	
                $500,000.00

              	
                February
      12, 2008

              


      

    

    


    This
Convertible Promissory Note (this “Note”) is made and delivered
pursuant to the terms of that certain Agreement and Plan of Reorganization dated
the date hereof and entered into by and among Cellegy Pharmaceuticals, Inc., a
Delaware corporation (“Cellegy”), Adamis
Pharmaceuticals Corporation, a Delaware corporation (“Adamis”), and Cellegy
Holdings, Inc., a Delaware corporation and wholly-owned subsidiary of Cellegy
(the “Merger
Agreement”).

    


    1.           Obligation.  For
value received, Adamis promises to pay to Cellegy, at such address as Cellegy
may from time to time designate, the sum of Five Hundred Thousand Dollars
($500,000), together with interest on the outstanding principal amount for the
period commencing on the date of this Note until such principal is paid in full
at a rate per annum equal to ten percent (10.0%) (the “Interest Rate”), calculated
on the basis of a 365-day year and actual days elapsed (including the first day,
but excluding the last day) occurring in the period for which such interest is
payable.    All interest shall accrue hereunder and be
payable on the Maturity Date (as defined below).

    


    2.           Payment
Dates.  Unless converted prior thereto, Adamis shall make
payment in full of all unpaid principal, interest and other amounts owed under
this Note on the Maturity Date.  The “Maturity Date” means the first
to occur of (i) the date of the termination of the Merger Agreement (a) by
Adamis for any reason other than Cellegy’s failure to satisfy its closing
conditions or (b) by Cellegy due to Adamis’ failure to satisfy its closing
conditions, or (ii)  the later of (a) the sixteenth month anniversary
of the date of this Note or (b) the date that is two business days following the
first date on which all of the notes issued to Imperium Master Fund, Ltd. (“Imperium”) pursuant to the
Securities Purchase and Loan Agreement dated December 21, 2007 by and between
Adamis and Imperium (collectively, the “Imperium Notes”) have been
repaid in full, including any default interest thereon, and are no longer
outstanding. Each payment payable by Adamis hereunder shall be made without
set-off or counterclaim and shall be free and clear of any restrictions or
conditions of any nature.


    
      
         


      

      
        1

        
          

        

      

      
         


      

    

     

    3.           Prepayment.  Adamis
shall make all payments that may be due hereunder in lawful money of the United
States of America, and may prepay any and all principal and interest at any time
without penalty, upon prior notice to Cellegy.

    


    4.           Default.  The
occurrence of any of the following shall constitute an “Event of Default” under this
Note:

    


    a.           delivery
by Cellegy of a notice of default to Adamis following Adamis’ failure to pay any
amount when due under this Note, if such default is not cured within twenty (20)
business days after delivery of such notice;

    


    b.           a
material default in the due performance or observance of any of Adamis’ material
obligations under this Note, or a material breach of any material representation
or warranty of Adamis under this Note, in each case which is not cured within
twenty (20) business days after delivery of notice from Cellegy;

    


    c.           Adamis
shall (any of the foregoing referred to as an “Insolvency
Event”):

    


    
      	
               
      

            	
              (i)

            	
              apply
      for or consent to the appointment of a trustee, receiver, sequestrator or
      other custodian for Adamis or for any substantial part of its property, or
      make a general assignment for the benefit of its
  creditors;

            


    

     

    
      	
               
      

            	
              (ii)

            	
              in
      the absence of such application or consent, acquiesce in, or permit or
      suffer to exist, the involuntary appointment of a trustee, receiver,
      sequestrator or other custodian for Adamis or for a substantial part of
      its property, and such trustee, receiver, sequestrator or other custodian
      shall not be discharged within forty-five (45)
  days;

            


    

     

    
      	
               
      

            	
              (iii)

            	
              permit
      the involuntary commencement of, or voluntarily commence, any insolvency
      proceedings under any bankruptcy or insolvency laws of the United States
      or any State thereof, or other similar laws, rules or regulations of such
      jurisdictions, covering the protection of creditors’ rights or the relief
      of debtors. (“Insolvency
      Laws”), or permit the involuntary commencement of, or voluntarily
      commence, any dissolution, winding up or liquidation proceeding, in each
      case, by or against Adamis, provided that, if not commenced by Adamis,
      such proceeding shall be consented to or acquiesced in by Adamis, or shall
      result in the entry of an order for relief or shall remain undismissed for
      more than forty-five (45) days; or

            


    

     

    
      	
               
      

            	
              (iv)

            	
              take
      any corporate action authorizing any of the
  foregoing.

            


    

     

    Upon the
occurrence of an Event of Default, (1) if and only if the Imperium Notes have
been repaid in full, including any default interest, and are no longer
outstanding, then, with notice to Adamis, Cellegy may declare all sums hereunder
to be immediately due and payable, whereupon such principal and other
obligations shall become and be immediately due and payable, in each case,
without notice, demand, presentment or other action of any kind, all of which
are hereby expressly and irrevocably waived by Adamis, or (2) if the Imperium
Notes remain outstanding, Cellegy may convert the Obligations as contemplated by
Section 7.2 hereof.


    
      
         


      

      
        2

        
          

        

      

      
         


      

    

     

    5.           Interest on Overdue Amounts;
Limitation on Interest.  Adamis agrees that upon the occurrence
of an Event of Default, in lieu of the interest payable under Section 1 above,
the outstanding principal balance shall immediately begin to accrue interest at
a rate equal to the
Interest Rate plus five
percent (5%) per annum, commencing on the date of the Event of Default and
continuing until paid in full.  In no event, however, shall the
default interest rate exceed the maximum amount permitted by
law.  Nothing in this Note or any document securing payment hereof is
to be construed as requiring payment of interest at a rate in excess of the
maximum rate permitted to be charged under the laws of the State of
California.  Neither Adamis nor any other party who may hereafter
become liable or responsible for the payment of this Note shall be required to
pay interest on this Note at a rate which exceeds the maximum rate permitted by
California law.  If by the terms of this Note Adamis is at any time
required or obligated to pay interest on the principal amount of this Note at a
rate in excess of such maximum rate, the rate of interest under this Note shall
be deemed to be immediately reduced to such maximum rate and the interest
payable shall be computed at a maximum rate and all prior interest payments in
excess of such maximum rate shall be applied and shall be deemed to have been
payments in reduction of the principal balance of this Note.

    


    6.           Representations and
Warranties of Adamis.  Adamis represents and warrants to
Cellegy as follows:  (a) Adamis has received from Cellegy on the date
hereof the cash proceeds of the Loan in the original principal amount stated
above, by wire transfer of such amount to an account designated in writing by
Adamis; and (b) this Note constitutes the legal, valid and binding obligation of
Adamis, enforceable against Adamis in accordance with its terms, except to the
extent that the enforceability thereof may be limited by or subject to
bankruptcy or Insolvency Laws or moratorium or other similar laws now or
hereafter in effect affecting creditors’ right generally.

    


    7.           Conversion.

     

    7.1           Mandatory
Conversion.  In the event the Effective Time of the Merger (as
defined in the Merger Agreement) precedes the Maturity Date, immediately prior
to the Effective Time all principal, interest and other amounts due Cellegy
hereunder (collectively, the “Obligations”) shall, without
any further action by Cellegy, automatically convert into a number of fully-paid
and nonassessable shares of Adamis common stock (the “Conversion Shares”) equal to
the amount of the Obligations divided by $0.50 (such price referred to as the
“Conversion
Price”).

     

    (a)           Optional Conversion
Following Event of Default.  Following the occurrence of an
Event of Default, if Adamis does not timely pay the Obligations, then at any
time thereafter Cellegy may, by notice to Adamis (a “Conversion Notice”), convert
the Obligations into the number of Conversion Shares equal to the total amount
of the Obligations, divided by the Conversion Price.


    
      
         


      

      
        3

        
          

        

      

      
         


      

    


    7.2           Conversion
Procedure.  In the event of an optional conversion pursuant to
Section 7.2 hereof, within five (5) business days of the delivery by Cellegy of
a Conversion Notice, Adamis shall deliver to Cellegy a notice specifying the
Conversion Price, describing in reasonable detail the manner in which the
Conversion Price was calculated, and shall provide such additional information
as Cellegy may reasonably request concerning the facts relating to the
determination of the Conversion Price.  Upon the conversion of this
Note pursuant to Section 7.2 hereof and return by Cellegy of this Note to Adamis
for cancellation, Adamis at its expense will issue and deliver to Cellegy a
certificate (bearing such legends as are required by applicable state and
federal securities laws in the opinion of counsel to Adamis) for the number of
full shares of Common Stock issuable upon such conversion.  Upon
conversion, this Note shall be canceled and discharged in full and no further
amounts shall be due hereunder.

     

    7.3           No Fractional
Shares.  No fractional Conversion Shares shall be issued upon
conversion of this Note.  In lieu of Adamis issuing any fractional
shares to Cellegy upon the conversion of this Note, Adamis shall pay to Cellegy
the amount of outstanding principal and interest hereunder that is not so
converted.

     

    7.4           Adjustments to
Shares.  If the capital stock issuable upon conversion of this
Note shall be changed into the same or a different number of shares of any other
class or classes of stock, whether by stock split, stock dividend, capital
reorganization, reclassification, merger or other corporate combination, or
other similar transaction, the conversion price of this Note then in effect
shall, concurrently with the effectiveness of such reorganization or
reclassification, be proportionately adjusted so that this Note shall be
convertible into, in lieu of the number of shares of capital stock which the
holders would otherwise have been entitled to receive, a number of shares of
such other class or classes of stock equivalent to the number of shares of
capital stock that would have been received by Cellegy immediately following
such change if Cellegy had converted this Note immediately prior to such
change.

     

    8.          Acknowledgment,
Representations and Warranties of Cellegy.  Cellegy understands
and acknowledges that neither this Note nor the Conversion Shares have been
registered under the Securities Act of 1933, as amended (the “Act”), or any state securities
laws.  Cellegy hereby represents and warrants to Adamis
that:

     

    8.1           This
Note and, if applicable, the Conversion Shares (collectively, the “Securities”) have been
acquired by Cellegy for investment and not with a view to the sale or other
distribution thereof within the meaning of the Act, and Cellegy has no present
intention of selling or otherwise disposing of all or any portion of the
Securities.

     

    8.2           Cellegy
has acquired the Securities for Cellegy’s own account only, and no other person
or entity has any beneficial ownership in the Securities.

     

    8.3           Cellegy
is capable of evaluating the merits and risks of any investment in the
Securities, is financially capable of bearing a total loss of this investment
and has either (i) a preexisting personal or business relationship with
Adamis or its principals or (ii) by reason of Cellegy’s business or
financial experience, has the capacity to protect its own interest in connection
with this investment.


    
      
         


      

      
        4

        
          

        

      

      
         


      

    


    8.4           Cellegy
has had access to all information regarding Adamis, its present and prospective
business, assets, liabilities and financial condition that Cellegy considers
important to making the decision to acquire the Securities and has had the
opportunity to ask questions of and receive answers from Adamis’ representatives
concerning an investment in the Securities and to obtain any and all documents
requested in order to supplement or verify any of the information
supplied.

     

    8.5           Cellegy
understands that the Securities are deemed restricted securities under the Act
and may not be resold unless they are registered under the Act and qualified
under any applicable state securities law, or unless sale, transfer or other
Disposition of the Securities is exempt from such registration and qualification
requirements, and Cellegy will not make any sale or other disposition of any of
the Securities unless such sale or disposition is so registered or
exempt.  Cellegy is familiar with Rule 144 promulgated under the Act
and understands that Rule 144 may prohibit or restrict subsequent resale,
transfer or disposition of the Conversion Shares.  Cellegy understands
that no public market now exists for any of the securities issued by Adamis and
that Adamis has made no assurances that a public market will ever exist for any
of Adamis’ securities.

     

    9.           Subordination.  The
indebtedness evidenced by this Note is subordinated in right of payment to the
prior payment in full of any indebtedness of Adamis outstanding as of the date
hereof and Senior Indebtedness.  “Senior Indebtedness” shall
mean, unless expressly subordinated to or made on a parity with the amounts due
under this Note, all amounts due in connection with (a) indebtedness of Adamis
to banks or other lending institutions regularly engaged in the business of
lending money, and (b) any such indebtedness or any debentures, notes or other
evidence of indebtedness issued in exchange for such Senior Indebtedness, or any
indebtedness arising from the satisfaction of such Senior Indebtedness by a
guarantor.

     

    9.1           Insolvency
Proceedings.  If there shall occur any receivership,
insolvency, assignment for the benefit of creditors, bankruptcy, reorganization,
or arrangements with creditors (whether or not pursuant to bankruptcy or other
insolvency laws), sale of all or substantially all of the assets, dissolution,
liquidation, or any other marshaling of the assets and liabilities of Adamis,
(a) no amount shall be paid by Adamis in respect of the principal of, interest
on or other amounts due with respect to this Note at the time outstanding,
unless and until the principal of and interest on the Senior Indebtedness then
outstanding shall be paid in full, and (b) no claim or proof of claim shall be
filed by or on behalf of Cellegy which shall assert any right to receive any
payments in respect of the principal of and interest on this Note except subject
to the payment in full of the principal of and interest on all of the Senior
Indebtedness then outstanding.

     

    9.2           Default on Senior
Indebtedness.  If there shall occur an event of default which
has been declared in writing with respect to any Senior Indebtedness, as defined
therein, or in the instrument under which it is outstanding, permitting the
holder to accelerate the maturity thereof and Cellegy shall have received
written notice thereof from the holder of such Senior Indebtedness, then, unless
and until such event of default shall have been cured or waived or shall have
ceased to exist, or all Senior Indebtedness shall have been paid in full, no
payment shall be made in respect of the principal of or interest on this Note
unless within one hundred eighty (180) days after the happening of such event of
default the maturity of such Senior Indebtedness shall not have been
accelerated.  Not more than one notice may be given to Cellegy
pursuant to the terms of this Section 9.2 during any 360 day
period.


    
      
         


      

      
        5

        
          

        

      

      
         


      

    

     

    9.3           Further
Assurances.  By acceptance of this Note Cellegy agrees to
execute and deliver customary forms of subordination agreement requested from
time to time by the holders of Senior Indebtedness and, as a condition to
Cellegy’s rights hereunder, Adamis may require that Cellegy execute such forms
of subordination agreement, provided that such forms shall not impose on Cellegy
terms less favorable than those provided herein.

     

    10.           Governing
Law.  This Note shall be governed by and construed under the
laws of the State of Delaware, excluding its conflicts of laws
rules.

     

    11.           Notice.  All
notices or other communications required or given hereunder shall be in writing
and shall be deemed effectively given when presented personally or on the date
of receipt (or refusal of delivery) if sent by courier service or U.S. Mail
(certified or registered, postage prepaid, return receipt requested) to the
parties at the addresses given below or such other addresses as the parties may
hereafter designate in writing.  The date shown on the courier’s
confirmation of delivery or return receipt shall be conclusive as to the date of
receipt.

     

    if to Cellegy:

    


    2085B
Quaker Point Road

    Quakertown,
PA 18951

    Attention:
Chief Executive Officer

    Telephone
No.:  (215) 529-6084

    Facsimile
No.:  (215) 529-6086

    


    with a
copy to:

    


    C. Kevin
Kelso

    Weintraub
Genshlea Chediak

    400
Capitol Mall, 11th
Floor

    Sacramento,
California 95814

    Telephone:
(916) 558-6000

    Fax:
(916) 446-1611

    Email:  kkelso@weintraub.com

    


    if to
Adamis:

    


    Adamis
Pharmaceuticals Corporation

    2658 Del
Mar Heights Road, #555

    Del Mar,
CA 92014

    Attention: President

    Telephone
No.: (858) 401-3984


    
      
         


      

      
        6

        
          

        

      

      
         


      

    

     

    with a
copy to:

    


    Cooley Godward Kronish LLP

    4401 Eastgate Mall

    San Diego, CA 92121

    Attention:  Patrick
Loofbourrow, Esq.

    Telephone
No.:  (858) 550-6000

    Facsimile No.:  (858)
550-6420

    


    12.           Severability.  If
any provision or any word, term, clause or part of any provision of this Note
shall be invalid or unenforceable for any reason, the same shall be ineffective,
but the remainder of this Note and of the provision shall not be affected and
shall remain in full force and effect.

     

    13.           Waivers.  The
holder of this Note may accept late or partial payments even though they are
marked "payment in full," without losing, prejudicing or waiving any rights
hereunder or otherwise available to holder at law or in equity.  The
granting without notice of any extension or extensions of time for payment of
any sum or sums due hereunder, or for the performance of any covenants or
agreements hereof, or the taking or release of other or additional security,
shall in no way release or discharge the liability of Adamis or any surety,
guarantor or endorser.  A waiver by the holder of this Note or failure
to enforce any covenant or condition of this Note, or to declare any default
hereunder, shall not operate as a waiver of any subsequent default or affect the
right of the holder of this Note to exercise any right or remedy not expressly
waived in writing.  Any of the terms or conditions of this Note may be
waived by Cellegy, but no such waiver shall affect or impair the rights of
Cellegy to require observance, performance, or satisfaction, either of that term
or condition as it applies on a subsequent occasion or of any other term or
condition of this Note.  Adamis hereby unconditionally and irrevocably
waives notice of acceptance, presentment, notice of nonpayment, protest, notice
of protest, suit and all other conditions precedent in connection with the
delivery, acceptance, collection and/or enforcement of this Note or any
collateral or security therefor or any guarantees hereof.

     

    14.           Dispute
Resolution.  The provisions of the Merger Agreement governing
resolution of disputes shall apply with respect to any dispute, claim or
proceeding arising under or relating to this Note, and such provisions are
hereby incorporated by reference.  In any action arising out of
relating to this Note, the prevailing party shall be entitled to recover from
each other party all of its attorneys fees and costs, in addition to costs and
expenses otherwise allowed by law, and Adamis agrees to pay all of Cellegy’s
reasonable costs and expenses, including reasonable attorneys’ fees, that may be
incurred in forcing or protecting Cellegy’s rights or interests
hereunder.

     

    15.           Cumulative
Remedies.  Upon any Event of Default under this Note, the
holder hereof, at its option, may exercise any right or remedy available to it
hereunder, and all available rights and remedies shall be cumulative, including
those available hereunder and available at law or in equity.

     

    16.           General
Provisions.  No amendment, modification, change, waiver or
discharge shall be effective unless evidenced by an instrument in writing and
signed by the party against whom enforcement of any waiver, amendment, change,
modification or discharge is sought.  The provisions of this Note
shall be binding upon and inure to the benefit of the heirs, personal
representatives, successors and assigns of the Adamis and
Cellegy.


    
      
         


      

      
        7

        
          

        

      

      
         


      

    

     

    17.           Commercial
Purpose.  The indebtedness evidenced by this Note is incurred
by Adamis solely for commercial purposes, and not for personal, family or
household purposes.

     

    [SIGNATURE
PAGE DIRECTLY FOLLOWS THIS PAGE]



    
      
         


      

      
        8

        
          

        

      

      
         


      

    

    


    In Witness
Whereof, the parties below have executed this Note as of the date and
year first above written.

    


    
      
        
          
            
              
                	
                        ADAMIS
      PHARMACEUTICALS CORPORATION

                      
	 
      
	
                        By:

                      	
                        /s/
      Dennis J. Carlo

                      
	
                        Name:

                      	
                        Dennis
      J. Carlo

                      
	
                        Title:

                      	
                        President
      and Chief Executive
Officer

                      


              

            

          

        

      

    

    


    
      
        
          
            
              	
                      CELLEGY PHARMACEUTICALS, INC.

                    
	 
      
	
                      By:

                    	
                      /s/
      Richard C. Williams

                    
	
                      Name:

                    	
                      Richard
      C. Williams

                    
	
                      Title:

                    	
                      Interim
      Chief Executive
Officer

                    


            

          

        

      

    


    
      
         


      

      
        9