Document:

Incorporated
      under the Laws of the State of Delaware

    

    Paragon
      Semitech USA, Inc.

    Series
      A Convertible Preferred Stock

    Total
      Authorized Issue 2,000,000 Shares of Series A Convertible Preferred Stock,
      

    (par
      value $.001 per share)

    

    
      	
              No.        
                

            	
              _________
                Shares

            

    

    

    THIS
      CERTIFIES THAT,
      ______________,
      is
      the
      registered holder of ____________________________
      (________) fully paid and non-assessable shares, par value $.001 per share,
      of
      the Series A Convertible Preferred Stock of Paragon Semitech USA, Inc.
      (hereinafter and on the reverse hereof called the “Corporation”),
      transferable on the books of the Corporation only upon request of the holder
      hereof in person (or of such holder’s attorney thereunto authorized by power of
      attorney duly executed and filed with the Secretary of the Corporation), and
      upon surrender of this Certificate properly endorsed or accompanied by a stock
      power duly executed, or upon a duly executed conversion notice acknowledged
      by
      the Corporation as indicated by a signature of a duly authorized officer of
      the
      Corporation. 

    

    IN
      WITNESS WHEREOF,
      the
      Corporation has caused this Certificate to be signed by its duly authorized
      officers this ___ day of __________, 2008.

    

    
      	
                    
                

            	 	
                     
                

            	 
	
              John
                D. Kuhns, President

            	 	
              Mary
                E. Fellows, Secretary

            	 

    

    

    THESE
      SECURITIES (THE “SECURITIES”) HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
      OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE
      AND MAY NOT BE SOLD OR OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE
      OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES OR AN OPINION OF
      COUNSEL OR OTHER EVIDENCE ACCEPTABLE TO THE CORPORATION THAT SUCH REGISTRATION
      IS NOT REQUIRED.

    

    The
      Corporation will furnish without charge to each stockholder who so requests
      a
      copy of the Certificate of Designations, Preferences and Rights of Series A
      Convertible Preferred Stock filed by the Corporation with the Secretary of
      State
      of Delaware.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    FOR
      VALUE
      RECEIVED _________________________________________________________ does
      hereby sell, assign and transfer unto
      ________________________________________________________________ Shares
      evidenced by the within Certificate,
      and does hereby irrevocably constitute and appoint
      ____________________________________________

    __________________
      attorney
      to transfer the said Shares on the books of the within-named Corporation, with
      full power of substitution in the premises.

    

    Dated
      _______________________________________

    

    In
      presence of: _________________________________________________

    

    NOTICE: The
      signature to this assignment must correspond with the name as written upon
      the
      face of the Certificate in every particular, without alteration or enlargement,
      or any change whatever.WARRANT

     

    NEITHER
      THIS WARRANT NOR ANY SHARES OF COMMON STOCK ISSUABLE UPON THE EXERCISE OF THIS
      WARRANT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
      AND
      THE RULES AND REGULATIONS PROMULGATED THEREUNDER (THE “SECURITIES
      ACT”).
      THIS
      WARRANT AND THE COMMON STOCK ISSUABLE UPON EXERCISE OF THIS WARRANT MAY NOT
      BE
      OFFERED, SOLD, OR OTHERWISE TRANSFERRED IN THE ABSENCE OF REGISTRATION UNDER
      THE
      SECURITIES ACT OR UNLESS SUCH OFFER, SALE OR TRANSFER IS EXEMPT FROM SUCH
      REGISTRATION.

     

    PARAGON
      SEMITECH USA, INC.

     

    COMMON
      STOCK WARRANT

     

    
      	
              No.
                ___

            	
              September
                2, 2008

            

    

     

    PARAGON
      SEMITECH USA, INC.,
      a
      Delaware corporation (the “Company”),
      hereby certifies that ________________, and its
      permissible transferees, designees, successors and assigns (collectively, the
      “Holder”),
      for
      value received, is entitled to purchase from the Company at any time commencing
      on the date hereof (the “Effective
      Date”),
      and
      terminating on September 1, 2011 (the “Termination
      Date”)
      _______________  (_______________) shares
      (each, a “Share”
and
      collectively the “Shares”)
      of the
      Company’s common stock, $.001 par value per Share (the “Common
      Stock”),
      at an
      exercise price of $0.125 per Share (the “Exercise
      Price”).
      The
      number of Shares purchasable hereunder and the Exercise Price are subject to
      adjustment as provided in Section 4 hereof. Unless otherwise defined herein
      capitalized terms shall have the respective meanings ascribed to them in the
      Securities Purchase Agreement dated as of September 2, 2008 by and between
      the
      Company and The China Hand Fund I, LLC (the “Securities
      Purchase Agreement”).

     

    1.
      Exercise
      of Warrant. The
      purchase right represented by this Common Stock Warrant (this "Warrant")
      is
      exercisable, in whole or in part, at any time and from time to time from and
      after the Effective Date through and including the Termination Date. Upon
      presentation and surrender of this Warrant, accompanied by a completed Election
      to Purchase in the form attached hereto as Exhibit
      A
      (the
“Election
      to Purchase”)
      duly
      executed, at the principal office of the Company currently located at 197 Route
      18 South, Suite 3000, PMB 4157, East Brunswick, NJ 08816 (or such other office
      or agency of the Company as the Company may designate to the Holder) together
      with a check payable to, or wire transfer to, the Company in the amount of
      the
      Exercise Price multiplied by the number of Shares being purchased, the Company
      or the Company’s transfer agent, as the case may be, shall within three (3)
      business days deliver to the Holder hereof a certificate or certificates
      representing fully paid and non-assessable Common Stock which in the aggregate
      represent the number of Shares being purchased. The certificates so delivered
      shall be in such denominations as may be requested by the Holder and shall
      be
      registered in the name of the Holder or such other name as shall be designated
      by the Holder. All or less than all of the purchase rights represented by this
      Warrant may be exercised and, in case of the exercise of less than all, the
      Company, upon surrender hereof, will at the Company’s expense deliver to the
      Holder a new warrant entitling said Holder to purchase the number of Shares
      represented by this Warrant which have not been exercised. This Warrant may
      only
      be exercised to the extent the Company has a sufficient number of Shares of
      Common Stock available for issuance at the time of any exercise. 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    2.
      Warrant.

     

    (a) Exchange
      of Warrant.
      At any
      time prior to the exercise hereof, this Warrant may be exchanged upon
      presentation and surrender to the Company, alone or with other warrants of
      like
      tenor of different denominations registered in the name of the same Holder,
      for
      another warrant or warrants of like tenor in the name of such Holder exercisable
      for the aggregate number of Shares as the warrant or warrants
      surrendered.

     

    (b) Replacement
      of Warrant.
      Upon
      receipt of evidence reasonably satisfactory to the Company of the loss, theft,
      destruction, or mutilation of this Warrant and, in the case of any such loss,
      theft, or destruction, upon delivery of an indemnity agreement reasonably
      satisfactory in form and amount to the Company, or, in the case of any such
      mutilation, upon surrender and cancellation of this Warrant, the Company, at
      its
      expense, will execute and deliver in lieu thereof, a new Warrant of like tenor.
      

     

    (c) Cancellation;
      Payment of Expenses.
      Upon the
      surrender of this Warrant in connection with any transfer, exchange or
      replacement as provided in this Section 2, this Warrant shall be promptly
      canceled by the Company. The Holder shall pay all taxes and all other expenses
      (including legal expenses, if any, incurred by the Holder or transferees) and
      charges payable in connection with the preparation, execution and delivery
      of
      Warrants pursuant to this Section 2. 

     

    (d) Warrant
      Register.
      The
      Company shall maintain, at its principal executive offices (or at the offices
      of
      the transfer agent for the Warrant or such other office or agency of the Company
      as it may designate by notice to the holder hereof), a register for this Warrant
      (the “Warrant
      Register”),
      in
      which the Company shall record the name and address of the person in whose
      name
      this Warrant has been issued, as well as the name and address of each transferee
      and each prior owner of this Warrant.

     

    3.
      Rights
      and Obligations of Holder of this Warrant.
      The
      Holder of this Warrant shall not, by virtue hereof, be entitled to any rights
      of
      a stockholder in the Company, either at law or in equity; provided,
      however,
      that in
      the event any certificate representing shares of Common Stock or other
      securities is issued to the holder hereof upon exercise of this Warrant, such
      holder shall, for all purposes, be deemed to have become the holder of record
      of
      such Common Stock on the date on which this Warrant, together with a duly
      executed Election to Purchase, was surrendered and payment of the aggregate
      Exercise Price was made, irrespective of the date of delivery of such Common
      Stock certificate.

     

    
      
        
        

      

      
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    4.
      Adjustments.
      

     

    (a) Stock
      Dividends, Reclassifications, Recapitalizations, Etc.
      If after
      the Effective Date at any time this Warrant is outstanding and the term of
      this
      Warrant has not expired, the Company: (i) pays a stock dividend or otherwise
      make a distribution or distributions on shares of its Common Stock payable
      in
      shares of Common Stock, (ii) subdivides (including by way of stock split) its
      outstanding shares of Common Stock into a larger number of shares, (iii)
      combines (including by way of reverse stock split) outstanding shares of Common
      Stock into a smaller number of shares, or (iv) issues by reclassification of
      shares of Common Stock any shares of capital stock of the Company, then
      (1) the Exercise Price on the record date of such division or distribution
      or the effective date of such action shall be adjusted by multiplying such
      Exercise Price by a fraction, the numerator of which is the number of shares
      of
      Common Stock outstanding immediately before such event and the denominator
      of
      which is the number of shares of Common Stock outstanding immediately after
      such
      event, and (2) the number of shares of Common Stock for which this Warrant
      may be exercised immediately before such event shall be adjusted by multiplying
      such number by a fraction, the numerator of which is the Exercise Price
      immediately before such event and the denominator of which is the Exercise
      Price
      immediately after such event.

     

    (b) Cash
      Dividends and Other Distributions.
      In the
      event that at any time or from time to time the Company shall distribute to
      all
      holders of Common Stock (i) any dividend or other distribution of cash,
      evidences of its indebtedness, shares of its capital stock or any other
      properties or securities or (ii) any options, warrants or other rights to
      subscribe for or purchase any of the foregoing (other than in each case,
      (w) the issuance of any rights under a shareholder rights plan,
      (x) any dividend or distribution described in Section 4(a), (y) any
      rights, options, warrants or securities described in Section 4(b) and (z) any
      cash dividends or other cash distributions from current or retained earnings),
      then the number of shares of Common Stock issuable upon the exercise of this
      Warrant shall be increased to a number determined by multiplying the number
      of
      shares of Common Stock issuable upon the exercise of this Warrant immediately
      prior to the record date for any such dividend or distribution by a fraction,
      the numerator of which shall be such Current Market Value (as defined in Section
      4(h)) per share of Common Stock on the record date for such dividend or
      distribution, and the denominator of which shall be such Current Market Value
      per share of Common Stock on the record date for such dividend or distribution
      less the sum of (x) the amount of cash, if any, distributed per share of Common
      Stock and (y) the fair value (as determined in good faith by the Board of
      Directors of the Company, whose determination shall be evidenced by a board
      resolution, a copy of which will be sent to the Holder upon request) of the
      portion, if any, of the distribution applicable to one share of Common Stock
      consisting of evidences of indebtedness, shares of stock, securities, other
      property, warrants, options or subscription or purchase rights; and the Exercise
      Price shall be adjusted to a number determined by dividing the Exercise Price
      immediately prior to such record date by the above fraction. Such adjustments
      shall be made whenever any distribution is made and shall become effective
      as of
      the date of distribution, retroactive to the record date for any such
      distribution. No adjustment shall be made pursuant to this Section 4(b) which
      shall have the effect of decreasing the number of shares of Common Stock
      issuable upon exercise of this Warrant or increasing the Exercise Price.

     

    
      
        
        

      

      
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    (c) Dilutive
      Issuances.
      From
      and after the Effective Date until 5:00 PM New York City time on the second
      anniversary of the Effective Date (after which no adjustment in the Exercise
      Price or number of shares of Common Stock pursuant this Section 4(c) shall
      be
      made), except for (i) Exempt Issuances (as defined below),  (ii)
      issuances covered by Sections 4(a) hereof or (iii) an issuance of Common Stock
      upon exercise or conversion of warrants, options or other convertible securities
      for which an adjustment has already been made pursuant to this Section 4, as
      to
      all of which this Section 4(c) does not apply,
      if
      the
      Company closes on the sale or issuance of Common Stock at a price, or issues
      warrants, options, convertible debt or equity securities with an exercise price
      per share or conversion price which is less than the Conversion Price then
      in
      effect the Exercise Price in effect from and after the date of such transaction
      shall be adjusted
      immediately thereafter so that it shall equal the price determined by
      multiplying the Exercise Price in effect immediately prior thereto by a
      fraction, the numerator of which shall be the sum of the number of shares of
      Common Stock outstanding immediately prior to the issuance of such additional
      shares plus the number of shares of Common Stock which the aggregate
      consideration received or receivable for the issuance of such additional shares
      would purchase at the Exercise Price then in effect, and the denominator of
      which shall be the number of shares of Common Stock outstanding immediately
      after the issuance of such additional shares. 

    

    (d) “Exempt
      Issuances”
shall
      mean the issuance of (a) shares of Common Stock or options to employees,
      officers, directors of and consultants (other than consultants whose services
      relate to the raising of funds) of the Company or its subsidiaries pursuant
      to
      any stock or option plan that was or may be adopted by the Board of Directors,
      (b) securities on the exercise or conversion of the Series A Preferred Stock
      (as
      defined in the Securities Purchase Agreement) or the Warrants, (c) securities
      on
      the exercise or conversion of any other options, warrants or convertible
      securities which are outstanding before the date of issuance of the Series
      A
      Preferred Stock, (d) securities issued pursuant to acquisitions, licensing
      agreements, or other strategic transactions which are approved by the Board
      of
      Directors and (e) securities issued pursuant to a bona fide firm underwritten
      public offering of the Company’s securities, provided such underwritten public
      offering has been approved in advance by the holders of more than fifty percent
      (50%) of the then outstanding shares of Series A Preferred Stock. 

     

    
      
        
        

      

      
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    (e) Calculations.
      All
      calculations under this Section 4 shall be made to the nearest cent or the
      nearest 1/100th of a share, as the case may be. For purposes of this Section
      4,
      the number of shares of Common Stock deemed to be issued and outstanding as
      of a
      given date shall be the sum of the number of shares of Common Stock (excluding
      treasury shares and shares owned by subsidiaries, if any) actually issued and
      outstanding.

    

    (f) Notice
      of Adjustment
      to Exercise Price.
      Whenever the Exercise Price is adjusted pursuant to this Section 4, the Company
      shall promptly mail to each holder a notice setting forth the Exercise Price
      after such adjustment and setting forth a brief statement of the facts requiring
      such adjustment.

    

    (g) Notices
      of Other Events.
      If (i)
      the Company shall authorize the granting to all holders of the Common Stock
      of
      rights or warrants to subscribe for or purchase any shares of capital stock
      of
      any class or of any rights; (ii) the approval of any stockholders of the Company
      shall be required in connection with any action, including without limitation,
      reclassification of the Common or any Fundamental Transaction (as such term
      is
      hereinafter defined), (iii) the
      Company shall authorize the dissolution, liquidation or winding up of the
      affairs of the Company; then in each case, the Company shall cause to be
mailed
      to
      the holders at their last addresses as they shall appear upon the stock
      records of
      the
      Company, at least 30 days prior to the applicable record or effective date,
      a
      notice stating (x)
      the
      date on which a record is to be taken for the purpose of such redemption, rights
      or warrants, or if a record is not to be taken, the date as of which the holders
      of the Common Stock of record to be entitled to such rights or warrants are
      to
      be determined or (y) the date on which such reclassification is expected to
      become effective or close, and the date as of which it is expected that holders
      of the Common Stock of record shall be entitled to exchange their shares of
      the
      Common Stock for securities, cash or other property deliverable upon such
      reclassification or Fundamental Transaction; provided,
      that
      the failure to mail such notice or any defect therein or in the mailing thereof
      shall not affect the validity of the corporate action required to be specified
      in such notice, provide such corporate action is otherwise valid. 

     

    (h) Current
      Market Value.“Current
      Market Value”
per
      share of Common Stock or any other security at any date means (i) if the
      security is not registered under the Securities Exchange Act of 1934 and/or
      traded on a national securities exchange, quotation system or bulletin board,
      as
      amended (the “Exchange
      Act”),
      (a)
      the value of the security, determined in good faith by the Board of Directors
      and certified in a board resolution, based on the most recently completed
      arm’s-length transaction between the Company and a Person other than an
      affiliate of the Company or between any two such Persons and the closing of
      which occurs on such date or shall have occurred within the six-month period
      preceding such date, or (b) if no such transaction shall have occurred within
      the six-month period, the value of the security as determined by an independent
      financial expert or an agreed upon financial valuation model or (ii) if the
      security is registered under the Exchange Act and/or traded on a national
      securities exchange, inter-dealer quotation system or on the over the counter
      Bulletin Board or Pink Sheets, the average of the daily closing bid prices
      (or
      the equivalent in an over-the-counter market) for each day on which the Common
      Stock is traded during the period commencing twenty (20) days before such date
      and ending on the date one day prior to such date.

     

    
      
        
        

      

      
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    (i) Fundamental
      Transaction.
      If, at
      any time while the Series A Preferred Stock is outstanding, (i) the Company
      effects any merger or consolidation of the Company with or into another person,
      (ii) the Company effects any sale of all or substantially all of its assets
      in
      one or a series of related transactions, (iii) any tender offer or exchange
      offer (whether by the Company or another person) is completed pursuant to which
      holders of Common Stock are permitted to tender or exchange their shares for
      other securities, cash or property, or (iv) the Company effects any
      reclassification of the Common Stock or any compulsory share exchange pursuant
      to which the Common Stock is effectively converted into or exchanged for other
      securities, cash or property (in any such case, a “Fundamental
      Transaction”),
      then
      upon any subsequent exercise of this Warrant, the holder shall have the right
      to
      receive, for each share that would have been issuable upon such exercise absent
      such Fundamental Transaction, the same kind and amount of securities, cash
      or
      property as it would have been entitled to receive upon the occurrence of such
      Fundamental Transaction if it had been the holder of one share of Common Stock,
      immediately prior to such Fundamental Transaction (the “Alternate
      Consideration”).
      For
      purposes of any such exercise, the determination of the Exercise Price shall
      be
      appropriately adjusted to apply to such Alternate Consideration based on the
      amount of Alternate Consideration issuable in respect of one share of Common
      Stock in such Fundamental Transaction, and the Company shall apportion the
      Exercise Price among the Alternate Consideration in a reasonable manner
      reflecting the relative value of any different components of the Alternate
      Consideration. If holders of Common Stock are given any choice as to the
      securities, cash or property to be received in a Fundamental Transaction, then
      the holder shall be given the same choice as to the Alternate Consideration
      it
      receives upon any exercise of this Warrant following such Fundamental
      Transaction. The terms of any agreement pursuant to which a Fundamental
      Transaction is effected shall include terms requiring any such successor or
      surviving entity to comply with the provisions of this paragraph.
      Notwithstanding the foregoing, in the event that the agreement relating to
      a
      Fundamental Transaction is approved by the holders of a majority of the
      then-outstanding shares of Series A Preferred Stock, then the holders of this
      Warrant shall have only the rights set forth in such agreement. 

     

    (j) Liquidation.  In
      the
      event of the dissolution, liquidation or winding-up of the Company, the Holders
      shall be entitled to receive, upon surrender of their Warrant, distributions
      on
      an equal basis with the holders of Common Stock or other securities issuable
      upon exercise of the Warrant, as if the Warrant had been exercised immediately
      prior to such event, less the Exercise Price. 

     

    
      
        
        

      

      
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    5. Fractional
      Shares.
      In lieu
      of issuance of a fractional share upon any exercise hereunder, the Company
      will
      pay the cash value of that fractional share, calculated on the basis of the
      Exercise Price. 

     

    6. Legends.
      Prior to
      issuance of the shares of Common Stock underlying this Warrant, all such
      certificates representing such shares shall bear a restrictive legend to the
      effect that the Shares represented by such certificate have not been registered
      under the Securities Act, and that the Shares may not be sold or transferred
      in
      the absence of such registration or an exemption therefrom, such legend to
      be
      substantially in the form of the bold-face language appearing at the top of
      Page
      1 of this Warrant. 

     

    7. Call
      Rights.
      The
      Company shall have the right to call the
      exercise of all, or the remaining portion of this Warrant outstanding and
      unexercised
      at the
      Exercise Price (or the adjusted Exercise Price pursuant to Section 4 of this
      Warrant) in the event (i) the Volume Weighted Average Price (“VWAP”)
      of the
      Common Stock equals or exceeds Four Dollars and Seventy Six Cents ($0.25) per
      share during any twenty (20) consecutive trading days and (ii) all Shares for
      which this Warrant is exercisable are registered for resale by the Holder (the
      “Call
      Conditions”).
      For
      the purposes of this Warrant, the VWAP shall be the volume weighted average
      price reported by Bloomberg for the Common Stock. In the event the Call
      Conditions are satisfied and the Company desires to exercise its call rights
      under this section the Company shall deliver a notice to each registered Holder
      of the Warrants setting for the number of Warrants held and the dollar amount
      due to exercise the Warrants (the “Call
      Notice”).
      Each
      Holder shall have thirty (30) calendar days from the receipt of the Call Notice
      to exercise the unexercised portion of the Warrants (the “Call
      Period”).
      Upon
      the expiration of the Call Period, any unexercised Warrant shall automatically
      expire.

     

    8.
      Disposition
      of Warrants or Shares.
      The
      Holder of this Warrant, each transferee hereof and any holder and transferee
      of
      any Shares, by his or its acceptance thereof, agrees that no public distribution
      of Warrants or Shares will be made in violation of the provisions of the
      Securities Act of 1933, as amended (the “Securities
      Act”).
      Furthermore, it shall be a condition to the transfer of this Warrant that any
      transferee thereof deliver to the Company his or its written agreement to accept
      and be bound by all of the terms and conditions contained in this Warrant.
      

     

    9. Merger
      or Consolidation.
      The
      Company will not merge or consolidate with or into any other corporation, or
      sell or otherwise transfer its property, assets and business substantially
      as an
      entirety to another corporation, unless the corporation resulting from such
      merger or consolidation (if not the Company), or such transferee corporation,
      as
      the case may be, shall expressly assume, by supplemental agreement reasonably
      satisfactory in form and substance to the Holder, the due and punctual
      performance and observance of each and every covenant and condition of this
      Warrant to be performed and observed by the Company.

     

    
      
        
        

      

      
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    10.  Notices.
      All
      notices and other communications provided for herein shall be in writing and
      shall be delivered by hand or overnight courier service, mailed by certified
      or
      registered mail or sent by facsimile, to the addresses set forth
      below:

    

    If
      to the
      Company:

    

    Paragon
      Semitech USA, Inc.

    558
      Lime
      Rock Road

    Lakeville,
      Connecticut 06039

    Facsimile:
      646-649-9454

    

    If
      to the
      Holder, to the address of the Holder as set forth in the records of the
      Company.

    

    Except
      as
      otherwise provided in this Agreement, all such communications shall be deemed
      to
      have been duly given when transmitted by telecopier or personally delivered
      or,
      in the case of a mailed notice, upon receipt, in each case given or addressed
      as
      aforesaid. The Company or the Holder may change its address or facsimile number
      for notices and other communications hereunder by notice to the other.

    

    11. Governing
      Law.
      This
      Warrant shall be governed by and construed in accordance with the laws of the
      State of New York applicable to contracts made and to be performed in the State
      of New York. 

     

    12. Successors
      and Assigns.
      This
      Warrant shall be binding upon and shall inure to the benefit of the parties
      hereto and their respective successors and assigns.

     

    13. Headings.
      The
      headings of various sections of this Warrant have been inserted for reference
      only and shall not affect the meaning or construction of any of the provisions
      hereof.

     

    14. Severability.
      If any
      provision of this Warrant is held to be unenforceable under applicable law,
      such
      provision shall be excluded from this Warrant, and the balance hereof shall
      be
      interpreted as if such provision were so excluded.

     

    15. Modification
      and Waiver.
      This
      Warrant and any provision hereof may be amended, waived, discharged or
      terminated only by an instrument in writing signed by the Company and the
      Holder. 

     

    16. Specific
      Enforcement.
      The
      Company and the Holder acknowledge and agree that irreparable damage would
      occur
      in the event that any of the provisions of this Warrant were not performed
      in
      accordance with their specific terms or were otherwise breached. It is
      accordingly agreed that the parties shall be entitled to an injunction or
      injunctions to prevent or cure breaches of the provisions of this Warrant and
      to
      enforce specifically the terms and provisions hereof, this being in addition
      to
      any other remedy to which either of them may be entitled by law or
      equity.

     

    
      
        
        

      

      
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    17. Assignment.
      This
      Warrant may be transferred or assigned, in whole or in part, at any time and
      from time to time by the then Holder by submitting this Warrant to the Company
      together with a duly executed assignment in the form attached hereto as
Exhibit
      B
      (the
“Form
      of Transfer”),
      as
      annexed hereto as Exhibit B and, upon the Company’s receipt thereof, and in any
      event, within three (3) business days thereafter, the Company shall issue a
      warrant to the Holder to evidence that portion of this Warrant, if any as shall
      not have been so transferred or assigned. 

     

    (signature
      page immediately follows)

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, the Company has caused this Warrant to be duly executed,
      manually or by facsimile, by one of its officers thereunto duly
      authorized.

    

      
        	 	
                PARAGON
                  SEMITECH USA, INC.

              
	 	 	 
	
                Date:
                  September 2, 2008

              	
                By:

              	       

	 	
                Name:

              
	 	
                Title:

              

      

    

    

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    Exhibit
      A

    

    FORM
      OF ELECTION TO PURCHASE

    

    (To
      be
      executed by the Holder to exercise the right to purchase shares of Common Stock
      under the foregoing Warrant)

    

    To:
      Paragon Semitech USA, Inc.:

    

    In
      accordance with the Warrant enclosed with this Form of Election to Purchase,
      the
      undersigned hereby irrevocably elects to purchase ______________ shares of
      Common Stock (“Common Stock”), $.01 par value, of Paragon Semitech USA, Inc.and
      encloses the warrant and $____ for each Warrant Share being purchased or an
      aggregate of $________________ in cash or certified or official bank check
      or
      checks, which sum represents the aggregate Exercise Price (as defined in the
      Warrant) together with any applicable taxes payable by the undersigned pursuant
      to the Warrant.

    

    The
      undersigned requests that certificates for the shares of Common Stock issuable
      upon this exercise be issued in the name of:

    

      
        	   

	   

	   

	
                (Please
                  print name and address)

              
	 
	     

	
                (Please
                  insert Social Security or Tax Identification
                  Number)

              

      

    

    

    If
      the
      number of shares of Common Stock issuable upon this exercise shall not be all
      of
      the shares of Common Stock which the undersigned is entitled to purchase in
      accordance with the enclosed Warrant, the undersigned requests that a new
      Warrant evidencing the right to purchase the shares of Common Stock not issuable
      pursuant to the exercise evidenced hereby be issued in the name of and delivered
      to:

    

    
      	   

	   

	   

	
              (Please
                print name and address)

            

    

    

      
        	
                Dated:                
                  

              	
                Name
                  of Warrant Holder:

              

      

    

     

    
      
        	
                (Print)
                  

              	    

	 	 
	
                (By:)
                  

              	     

	 	 
	
                (Name:)
                  

              	    

	 	 
	
                (Title:)
                  

              	     

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

              

      

    

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    Exhibit
      B

    

    FORM
      OF TRANSFER

    

    FOR
      VALUE
      RECEIVED, _________________ hereby sells, assigns and transfers unto
      __________________ the right to purchase _________ shares of Warrant evidenced
      by the within Warrant together with all rights therein, and does irrevocably
      constitute and appoint ___________________ attorney to transfer that part (or
      whole) of the said Warrant on the books of the within named
      corporation.

    
      

        
          	
                  Dated:                
                    

                	
                  Name
                    of Warrant Holder:

                

        

      

       

      
        
          	
                  (Print)
                    

                	    

	 	 
	
                  (By:)
                    

                	     

	 	 
	
                  (Name:)
                    

                	    

	 	 
	
                  (Title:)
                    

                	     

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

                

        

      

    

     

    FOR
      USE BY THE ISSUER ONLY:

    

    This
      Warrant No. -___ canceled (or transferred or exchanged) this _____ day of
      ___________, _____, _______shares of Common Stock issued therefor in the name
      of
      _______________, Warrant No. _____ issued for ____ shares of Common Stock in
      the
      name of _______________.

    

    
      
        
        

      

      
        12

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