Document:

Exhibit 4.1

[FRONT OF
CERTIFICATE]

Temporary
Certificate-Exchangeable For Definitive Engraved Certificate

When Available for Delivery

	
  [Graphic which contains: Number

  PCT        ]

  	
  HOSPITALITY
  PROPERTIES TRUST

  	
  [Graphic which contains:
  SHARES         ]

  

 

A MARYLAND REAL
ESTATE INVESTMENT TRUST

	
  7% SERIES C CUMULATIVE

  	
  7% SERIES C CUMULATIVE

  
	
  REDEEMABLE PREFERRED SHARES

  	
  REDEEMABLE PREFERRED SHARES

  
	
  THIS CERTIFICATE IS
  TRANSFERABLE IN 

  SOUTH SAINT PAUL, MN OR IN NEW YORK, NY

  	
  CUSIP 44106M 50 8

  
	
  SEE REVERSE FOR IMPORTANT
  NOTICE ON TRANSFER RESTRICTIONS AND OTHER INFORMATION

  
	
  THIS CERTIFIES THAT

  	
  —SPECIMEN—

  
	
  is the registered holder of

  	
   

  

 

FULLY PAID AND NONASSESSABLE 7% SERIES C
CUMULATIVE REDEEMABLE PREFERRED SHARES OF BENEFICIAL INTEREST, WITHOUT PAR
VALUE, IN

[Superimposed over the following paragraph are the
words “Preferred Shares”]

Hospitality Properties Trust (the “Trust”), a Maryland
real estate investment trust established by Declaration of Trust made as of May 12,
1995, as amended and supplemented from time to time, a copy of which, together
with all amendments and supplements thereto (the “Declaration”), is on file
with the State Department of Assessments and Taxation of Maryland. The
provisions of the Declaration and the Bylaws of the Trust, and all amendments
thereto, are hereby incorporated in and made a part of this certificate as
fully as if set forth herein in their entirety, to all of which provisions the
holder and every transferee or assignee hereof by accepting or holding the same
agrees to be bound. See reverse for existence of Trustees’ authority to
determine preferences and other rights of subsequent series of shares, and of
restriction on transfer provisions governing the shares evidenced by this
certificate. This certificate and the shares evidenced hereby are negotiable
and transferable on the books of the Trust by the registered holder hereof in
person or by its duly authorized agent upon surrender of this certificate
properly endorsed or assigned to the same extent as a stock certificate and the
shares of a Maryland corporation. This certificate is not valid until
countersigned by the Transfer Agent and registered by the Registrar.

Witness the facsimile seal of the Trust and the
facsimile signatures of its duly authorized officers.

Dated:

[Seal of Trust]

[Pin-printed is the
word “SPECIMEN” above each signature]

	
  /s/ Mark L. Kleifges

  	
   

  	
  /s/ John G. Murray

  	
   

  
	
  TREASURER

  	
   

  	
  PRESIDENT

  	
   

  

 

THE DECLARATION OF TRUST PROVIDES THAT THE NAME “HOSPITALITY
PROPERTIES TRUST” REFERS TO THE TRUSTEES UNDER THE DECLARATION OF TRUST,
COLLECTIVELY AS TRUSTEES, BUT NOT INDIVIDUALLY OR PERSONALLY, AND NO TRUSTEE,
SHAREHOLDER, EMPLOYEE OR AGENT OF THE TRUST SHALL BE HELD TO ANY PERSONAL
LIABILITY, JOINTLY OR SEVERALLY, IN CONNECTION WITH THIS INSTRUMENT. ALL
PERSONS DEALING WITH THE TRUST IN ANY WAY SHALL LOOK ONLY TO THE ASSETS OF THE
TRUST FOR PAYMENT OF ANY SUM OR PERFORMANCE OF ANY OBLIGATION.

COUNTERSIGNED AND REGISTERED:

WELLS FARGO BANK, N.A.

TRANSFER AGENT AND REGISTRAR

BY:

AUTHORIZED SIGNATURE

 

[REVERSE OF
CERTIFICATE]

HOSPITALITY PROPERTIES TRUST

IMPORTANT NOTICE

THE TRUST WILL FURNISH TO
ANY SHAREHOLDER, ON REQUEST AND WITHOUT CHARGE, A FULL STATEMENT OF THE
INFORMATION REQUIRED BY SECTION 8-203(d) OF THE CORPORATIONS
AND ASSOCIATIONS ARTICLE OF THE ANNOTATED CODE OF MARYLAND WITH RESPECT TO THE
DESIGNATIONS AND ANY PREFERENCES, CONVERSION AND OTHER RIGHTS, VOTING POWERS,
RESTRICTIONS, LIMITATIONS AS TO DIVIDENDS AND OTHER DISTRIBUTIONS,
QUALIFICATIONS, AND TERMS AND CONDITIONS OF REDEMPTION OF THE SHARES OF EACH CLASS OF
BENEFICIAL INTEREST WHICH THE TRUST HAS AUTHORITY TO ISSUE AND, IF THE TRUST IS
AUTHORIZED TO ISSUE ANY PREFERRED OR SPECIAL CLASS IN SERIES, (i) THE
DIFFERENCES IN THE RELATIVE RIGHTS AND PREFERENCES BETWEEN THE SHARES OF EACH
SERIES TO THE EXTENT SET, AND (ii) THE AUTHORITY OF THE BOARD OF TRUSTEES
TO SET SUCH RIGHTS AND PREFERENCES OF SUBSEQUENT SERIES. THE FOREGOING SUMMARY
DOES NOT PURPORT TO BE COMPLETE AND IS SUBJECT TO AND QUALIFIED IN ITS ENTIRETY
BY REFERENCE TO THE DECLARATION OF TRUST OF THE TRUST, AS AMENDED AND
SUPPLEMENTED, A COPY OF WHICH WILL BE SENT WITHOUT CHARGE TO EACH SHAREHOLDER
WHO SO REQUESTS. SUCH REQUEST MUST BE MADE TO THE SECRETARY OF THE TRUST AT ITS
PRINCIPAL OFFICE OR TO THE TRANSFER AGENT.

IF NECESSARY TO EFFECT
COMPLIANCE BY THE TRUST WITH REQUIREMENTS OF THE INTERNAL REVENUE CODE RELATING
TO REAL ESTATE INVESTMENT TRUSTS, OWNERSHIP OF THE SHARES EVIDENCED BY THIS
CERTIFICATE MAY BE RESTRICTED BY THE TRUST AND/OR THE TRANSFER THEREOF MAY BE
PROHIBITED ALL UPON THE TERMS AND CONDITIONS SET FORTH IN THE DECLARATION OF
TRUST. THE TRUST WILL FURNISH A COPY OF SUCH TERMS AND CONDITIONS TO THE
REGISTERED HOLDER OF THIS CERTIFICATE UPON REQUEST AND WITHOUT CHARGE.

The following
abbreviations, when used in the inscription on the face of this certificate,
shall be construed as though they were written out in full according to
applicable laws or regulations:

	
  TEN COM

  	
  —

  	
  as tenants in common

  	
   

  	
  UNIF GIFT MIN ACT-

  	
   

  	
  Custodian

  	
   

  
	
  TEN ENT

  	
  —

  	
  as tenants by the entireties

  	
   

  	
   

  	
  (Cust)

  	
   

  	
  (Minor)

  
	
  JT TEN

  	
  —

  	
  as joint tenants with right or survivorship and not
  as tenants in common

  	
   

  	
   

  	
  under Uniform Gifts to Minors Act

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  (State)

  

 

Additional abbreviations
may also be used though not in the above list.

For value received                                  
hereby sell, assign and transfer unto

PLEASE INSERT SOCIAL
SECURITY OR OTHER

IDENTIFYING NUMBER OF NEW OWNER [BOX]                                     

PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF
ASSIGNEE.

Shares of Beneficial
Interest represented by the within Certificate, and do hereby irrevocably
constitute and appoint

                                                          
Attorney to transfer the said shares on the books of the within-named Trust
with full power of substitution in the premises.

	
  Dated

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (Sign here)

  	
   

  	
   

  
	
   

  	
  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.

  
	
  SIGNATURE(S) GUARANTEED:

  	
   

  	
   

  
	
   

  	
  THE SIGNATURE(S) MUST BE GUARANTEED BY AN
  ELIGIBLE GUARANTOR INSTITUTION (BANKS,STOCKBROKERS, SAVINGS AND LOAN
  ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE
  GUARANTEE MEDALLION PROGRAM), PURSUANT TO S.E.C. RULE 17Ad-15.Exhibit
10.1

UNI-PIXEL,
INC.

SECURITIES
PURCHASE AGREEMENT

This SECURITIES
PURCHASE AGREEMENT (this “Agreement”)
is dated as of February 13, 2007, and is by and among UNI-PIXEL, INC., a
Delaware corporation, with its principal office at 8708 Technology Forest
Place, Suite 100, The Woodlands, Texas 77381 (the “Company”), and each
investor listed in Schedule 1 hereto (each such investor individually, a
“Purchaser”
and, collectively, the “Purchasers”).

WHEREAS the
Company desires to issue and sell to the Purchasers, and the Purchasers desire
to purchase from the Company, in aggregate, (a) 3,200,000 authorized but
unissued shares of the Company’s Series B Preferred Stock, par value $0.001 per
share (the “Series B
Preferred Stock”), and (b) Warrants (as defined below) to
purchase, in aggregate, up to 6,839,279 shares of the Company’s common stock,
par value $0.001 (the “Common Stock”),
for an aggregate purchase price of $12,000,000, all upon the terms and subject
to the conditions set forth in this Agreement; and

WHEREAS, at the
Closing (as defined below), the Company and the Purchasers shall enter into
that certain Investors’ Rights Agreement, dated as of the Closing, in the form
attached hereto as Exhibit A (the “Investors’ Rights Agreement”).

NOW THEREFORE, in
consideration of the mutual agreements, representations, warranties and
covenants herein contained, the parties hereto agree as follows:

1.                                       Definitions.  As used in this Agreement, the following
terms shall have the following respective meanings:

“Affiliate” of any
Person means any other Person that, directly or indirectly, through one or more
intermediaries, controls, is controlled by, or is under common control with,
such Person, as such terms are used and construed under Rule 144 (as defined
below), and with respect to Tudor (as defined below), in addition to the
foregoing, the term “Affiliate”
shall also include the Related Entities.

“Board” means the
Board of Directors of the Company.

“Bridge Loans” means the Company’s
12% Senior Secured Convertible Debentures and 10% Senior Unsecured Convertible
Promissory Note.

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

“Certificate of Designations”
means the Certificate of Designations of the Series B Preferred Stock adopted
by the Board and filed on or before the Closing (as defined below) by the
Company with the Secretary of State of the State of Delaware in accordance with
Delaware law, establishing the rights, preferences and privileges of the Series
B Preferred Stock, in the

form attached hereto as Exhibit
B.

“Conversion Shares”
means the shares of Common Stock issuable upon conversion of the Shares
pursuant to the terms of the Certificate of Designations.

“Disclosure Schedule” has the meaning
set forth in Section 3.

“Exchange Act” means
the Securities Exchange Act of 1934, as amended, and all of the rules and
regulations promulgated thereunder.

“Financial Statements” has the
meaning set forth in Section 3.7.

“Financial Statement Date” means the
date of the most recent audited financial statements of the Company, which date
is December 31, 2005.

“Intellectual Property” means all
rights and interests in and to all inventions, invention disclosures, patents,
patent applications, trademarks, trademark applications, service marks,
tradenames, copyrights, confidential or proprietary information, trade secrets,
licenses, domain names, mask works, information and proprietary rights and
processes as are material to the conduct of the business of the Company and the
Subsidiaries, taken as a whole, whether now conducted or proposed to be
conducted.

“Knowledge” (whether or not capitalized)
including the phrase “to the Company’s knowledge”
includes (a) actual knowledge of the Person, including the actual knowledge of
any of the officers or directors of the Company or any of the Subsidiaries, and
(b) that knowledge which a prudent businessperson could have obtained in the
management of his business after making due inquiry, and after exercising due
diligence, with respect thereto.

“Material Adverse Effect”
means any event, occurrence or development that has had, or that could
reasonably be expected to have, individually or in the aggregate with other
events, occurrences or developments, a material adverse effect on the assets,
liabilities (contingent or otherwise), business, affairs, operations, prospects
or condition (financial or otherwise) of the Company and its Subsidiaries,
taken as a whole; provided, however, that any change resulting from (a) general
economic conditions or industry conditions that do not disproportionately
affect the Company or its Subsidiaries, (b) the announcement of the
transactions contemplated by this Agreement and the performance by the parties
of their obligations under this Agreement, (c) any change in law, or (d) any
action permitted by this Agreement, shall not constitute a Material Adverse
Effect.

“Person” (whether or
not capitalized) means an individual, entity, partnership, limited liability
company, corporation, association, trust, joint venture, unincorporated
organization, and any government, governmental department or agency or
political subdivision thereof.

“Related Entities”
includes, with respect to Tudor, any entities for which any of the Tudor
Entities or its Affiliates serve as a general partner and/or investment advisor
or in a similar capacity, and all mutual funds or other pooled investment vehicles
or entities under the

 2
 

control or management of
any of the Tudor Entities or its Affiliates. 
For purposes of this Agreement, (a) “Tudor Entities” means each of the
following: Tudor Investment Corporation, Tudor Group Holdings LLC, their
respective Affiliates, and any Affiliate or Affiliated Group of Tudor
Investment Corporation and/or Tudor Group Holdings LLC, and (b) with respect to
the Tudor Entities, “Affiliated
Group” has the meaning given to it in Section 1504 of the
Internal Revenue Code of 1986, as amended, and in addition includes any
analogous combined, consolidated, or unitary group, as defined under any
applicable state, local or foreign income tax law.

“Rule 144” means Rule
144 promulgated under the Securities Act and any successor or substitute rule,
law or provision.

“SEC” means the
Securities and Exchange Commission.

“Securities Act” means
the Securities Act of 1933, as amended, and all of the rules and regulations
promulgated thereunder.

“Shares” means the
shares of Series B Preferred Stock issued and sold by the Company to the
Purchasers hereunder.

“Share Price” means
$3.75 per Share.

“Subsidiaries” means
the subsidiaries of the Company listed in Schedule 2-3.17 to the
Disclosure Schedule.

“Transaction Documents”
means, collectively, the Investors’ Rights Agreement, the Certificate of
Designations and the Warrant, including all Schedules and Exhibits thereto and
all certificates, opinions and other documents delivered in connection
therewith.

“Tudor” means,
collectively, The Raptor Global Portfolio Ltd., The Tudor BVI Global Portfolio
Ltd., Tudor Proprietary Trading, L.L.C., and The Altar Rock Fund L.P.

“Warrants” means the
warrants to purchase up to in aggregate 6,839,279 shares of Common Stock for a
purchase price of $1.24 per share, dated as of the Closing Date, issued by the
Company to the Purchasers pursuant hereto, in substantially the form attached
hereto as Exhibit C.

“Warrant
Amendments” means, collectively, the amendments to certain
outstanding warrants to purchase shares of Common Stock of the Company in
substantially the forms attached hereto as Exhibit D.

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

2.                                       Purchase
and Sale of Shares and Warrants.

2.1                                 Filing
of Certificate of Designations.  The
Company shall adopt and file

 3
 

with the Secretary of
State of the State of Delaware, on or before the Closing, the Certificate of
Designations.

2.2                                 Purchase
and Sale of Shares.  Subject to and
upon the terms and conditions set forth in this Agreement, the Company agrees
to issue and sell to each Purchaser, and each Purchaser hereby agrees,
severally and not jointly, to purchase from the Company, at the Closing, the
number of Shares set forth opposite such Purchaser’s name in Schedule 1
hereto, at the Share Price.

2.3                                 Issuance
of Warrants. Subject to and upon the terms and conditions set forth in this
Agreement, the Company agrees to issue to each Purchaser at the Closing, for no
further cash consideration, a Warrant to purchase the number of Warrant Shares
set forth opposite such Purchaser’s name in Schedule 1 hereto.

2.4                                 Closing.  The closing of the purchase and sale of the
Shares and Warrants (the “Closing”)
shall take place at 10:00 am (Eastern Time) at the offices of Boies, Schiller
& Flexner LLP, 575 Lexington Avenue, New York, NY 10022, on February 13,
2007, the date hereof, or on such other date and at such time as may be agreed
upon between the Purchasers, on the one hand, and the Company, on the other
hand (the “Closing Date”).  At the Closing, the Company shall deliver to
each Purchaser (i) a single stock certificate (or more, if reasonably requested
by the Purchaser), registered in the name of such Purchaser, representing the
number of Shares purchased by such Purchaser as described in Section 2.2
hereof and (ii) a Warrant in the name of such Purchaser for the number of
Warrant Shares as described in Section 2.3 hereof, against payment by or
on behalf of such Purchaser of the aggregate purchase price, as set forth
opposite such Purchaser’s name in Schedule 1 hereto, by wire transfer of
immediately available funds to such account as the Company shall designate in
writing.

3.                                       Representations
and Warranties of the Company.  The
Company hereby represents and warrants to each Purchaser, as of the date hereof
and except as set forth on the disclosure schedule attached hereto as Schedule
2 (the “Disclosure
Schedule”), as follows:

3.1                                 Incorporation.  Each of the Company and the Subsidiaries is a
corporation or other entity duly organized, validly existing and in good
standing under the laws of the State of Delaware (or such other applicable
jurisdiction of incorporation or formation as is indicated in Schedule 2-3.1
to the Disclosure Schedule), and is in good standing as a foreign corporation
or other entity in each jurisdiction in which the nature of the business
conducted or the character of the 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, would not result in a Material Adverse Effect. Each of the
Company and the Subsidiaries has all requisite corporate power and authority to
carry on its business as now conducted and to carry out the transactions
contemplated hereby. Neither the Company nor any of the Subsidiaries is in
violation of any of the provisions of its Certificate of Incorporation or
By-laws (or other charter or governing document).

3.2                                 Capitalization.  After giving effect to the Closing, the
authorized capital stock of the Company shall consist of:

(a)                                  Common
Stock.  100,000,000 shares of Common
Stock, of which

 4
 

(i) 16,311,973 shares are
duly issued and outstanding as of the Closing Date, (ii) 2,661,667 shares are
reserved for issuance upon exercise of outstanding options as of the Closing
Date, (iii) 6,282,635 shares are reserved for issuance upon conversion of the
Corporation’s Series A Preferred Stock, par value $0.001 (the “Series A Preferred Stock”), (iv)
3,792,900 shares are reserved for issuance upon exercise of currently outstanding
warrants to purchase shares of the Common Stock, and (v) 22,839,279 shares are
reserved for issuance upon conversion of the Shares and the Warrant Shares.

(b)                                 Preferred
Stock.  10,000,000 shares of
preferred stock, par value $0.001 per share (the “Preferred Stock”), of which (i)
4,500,000 shares are duly authorized and designated as Series A Preferred Stock
as of the Closing Date, (ii) 3,200,000 shares have been designated as Series B
Preferred Stock to be issued pursuant to this Agreement, and (iii) no other
shares are outstanding or authorized and reserved for issuance as of the
Closing Date.  The rights, preferences
and privileges of the Series B Preferred Stock are as stated in the Certificate
of Designations and as otherwise provided by the Delaware General Corporation
Law.  The rights, preferences and
privileges of the Series A Preferred Stock are as stated in the Certificate of
Designations of the Series A Preferred Stock adopted by the Board and filed by
the Company with the Secretary of State of the State of Delaware on December 9,
2004, in accordance with Delaware law, and as otherwise provided by the
Delaware General Corporation Law.

(c)                                  All
shares of the Company’s issued and outstanding capital stock have been duly
authorized, are validly issued and outstanding, and are fully paid and
nonassessable.

(d)                                 Except
for (i) the conversion privileges of the Series B Preferred Stock to be issued
pursuant to this Agreement, (ii) the Warrants and (iii) as set forth in Schedule
2-3.2(d) to the Disclosure Schedule, there are no existing options,
warrants, calls, preemptive (or similar) rights, subscriptions or other rights,
agreements, arrangements or commitments of any character obligating the Company
to issue, transfer or sell, or cause to be issued, transferred or sold, any
shares of the capital stock of the Company or other equity interests in the
Company or any securities or instruments convertible into or exchangeable or
exercisable for such shares of capital stock or other equity interests, and
there are no outstanding rights, agreements, arrangements or commitments of any
character obligating the Company to repurchase, redeem or otherwise acquire any
shares of its capital stock or other equity interests.  The issuance and sale of the Shares and the
Warrants and the issuance of Conversion Shares and Warrant Shares pursuant to
the terms of the Series B Preferred Stock and the Warrants, respectively, will
not obligate the Company to issue or sell, pursuant to any preemptive right or
otherwise, shares of Common Stock or other securities to any Person (other than
pursuant to the terms of the Series B Preferred Stock and the Warrants) and,
except as set forth in Schedule 2-3.2(d), will not result in a right of
any holder of capital stock or other securities of the Company to adjust the
exercise, conversion, exchange or reset price under such securities.

3.3                                 Registration
Rights.  Except as set forth in Schedule
2-3.3 to the Disclosure Schedule and in the Investors’ Rights Agreement,
the Company has not granted or agreed to grant to any Person any right
(including shelf, “piggy-back” and demand registration rights) to have any
capital stock or other securities of the Company registered with the SEC or any
other government authority.

 5
 

3.4                                 Authorization.  All corporate action on the part of the
Company, its officers and its directors necessary for the authorization,
execution, delivery and performance of this Agreement and the Transaction
Documents and the consummation of the transactions contemplated herein and therein,
has been taken.  When executed and
delivered by the Company, each of this Agreement and the Transaction Documents
shall constitute a legal, valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms, except as such
may be limited by bankruptcy, insolvency, reorganization or other laws
affecting creditors’ rights generally and by general equitable principles.  The Company has all requisite corporate power
and authority to enter into this Agreement and the Transaction Documents and to
carry out and perform its obligations under their respective terms.

3.5                                 Valid
Issuance of the Shares.  The Shares,
the Conversion Shares, the Warrants and the Warrant Shares have been duly
authorized, and the Shares, the Conversion Shares and the Warrant Shares, upon
issuance pursuant to the terms hereof, of the Series B Preferred Stock and of
the Warrants, respectively, will be validly issued, fully paid and
nonassessable and not subject to any encumbrances, preemptive rights or any
other similar contractual rights of the stockholders of the Company or any
other Person (other than pursuant to the Transaction Documents).  Assuming the accuracy of the representations
of the Purchasers in Section 4 hereof, and subject to the filings
described in Section 3.8 hereof, the Shares, Conversion Shares,
Warrants, and Warrant Shares will be issued in compliance with all applicable
federal and state securities laws.  The
Company has reserved from its duly authorized capital stock the number of
shares of Common Stock issuable upon conversion in full of the Shares and
exercise in full of the Warrants.

3.6                                 SEC
Documents.  The Company has furnished
to the Purchasers true and complete copies of the Company’s Annual Report on
Form 10-KSB for the year ended December 31, 2005, the Company’s quarterly
Reports on Form 10-QSB for the quarterly periods ended March 31, 2006, June 30,
2006, and September 30, 2006 (the “SEC Documents”).  As of their respective filing dates, each of
the SEC Documents complied in all material respects with the requirements of
the Exchange Act, and none of the SEC Documents contained any untrue statement
of a material fact or omitted to state material fact required to be stated
therein or necessary in order to make the statement made therein, in light of
the circumstances under which they were made, not misleading.  The financial statements of the Company
included in the SEC Documents comply in all material respects with applicable
accounting requirements and the rules and regulations of the SEC with respect
thereto in effect at the time of filing. 
All material agreements to which the Company is a party or to which the
property or assets of the Company are subject are included as part of or specifically
identified in the SEC Documents to the extent required by the rules and
regulations of the SEC as in effect at the time of filing.  The Company has prepared and filed, on a
timely basis, with the SEC all filings and reports required by the Securities
Act and the Exchange Act.

3.7                                 Financial
Statements.  Except as set forth in Schedule
2-3.7 to the Disclosure Schedule, the financial statements and supporting
schedules included in the SEC Documents and in any of the Company’s
registration statements filed with the SEC or other of the Company’s reports
filed with the SEC pursuant to Section 13 of the Exchange Act (collectively,
the “Financial Statements”), are complete
and correct in all material respects and

 6
 

present fairly the
consolidated financial position of the Company and its Subsidiaries as of the
dates specified and the consolidated results of their operations and cash flows
for the periods specified, in each case, in conformity with generally accepted
accounting principles and applied on a consistent basis during the periods involved,
except as indicated therein or in the notes thereto.

3.8                                 Consents.  Except for (a) the filing and effectiveness
of any registration statement required to be filed by the Company under the
Securities Act pursuant to the terms of the Investors’ Rights Agreement and (b)
a Form D filing and any required state “blue sky” law filings in connection
with the transactions contemplated hereunder or under the Transaction
Documents, all consents, approvals, orders and authorizations required on the
part of the Company in connection with the execution or delivery of, or the
performance of the obligations under, this Agreement and the Transaction
Documents, and the consummation of the transactions contemplated herein and
therein, have been obtained and will be effective as of the date hereof. Except
as set forth in Schedule 2-3.8 to the Disclosure Schedule, the execution
and delivery by the Company of this Agreement and the Transaction Documents,
the consummation of the transactions contemplated herein and therein, and the
issuance of the Shares, the Conversion Shares, the Warrants and the Warrant
Shares, do not require the consent or approval of the stockholders of, or any
lender to, the Company, or any other Person.

3.9                                 No
Conflict; Compliance with Laws.

(a)                                  The
execution, delivery and performance by the Company of this Agreement and the
Transaction Documents, and the consummation of the transactions contemplated
hereby and thereby, including the issuance of the Shares, the Conversion
Shares, the Warrants and the Warrant Shares, do not and will not (i) conflict
with or violate any provision of the Certificate of Incorporation (or other
charter documents) or By-laws of the Company or any of the Subsidiaries, (ii)
breach, conflict with or result in any violation of or default (or an event
that with notice or lapse of time or both would become a default) under, or
give rise to a right of termination, amendment, acceleration or cancellation
(with or without notice or lapse of time, or both) of any obligation, contract,
commitment, lease, agreement, mortgage, note, bond, indenture or other
instrument or obligation to which the Company or any of the Subsidiaries is a
party or by which they or any of their properties or assets are bound, except
such as does not constitute a Material Adverse Effect, or (iii) result in a
violation of any statute, law, rule, regulation, order, ordinance or
restriction applicable to the Company, the Subsidiaries or any of their
properties or assets, or any judgment, writ, injunction or decree of any court,
judicial or quasi-judicial tribunal applicable to the Company, the Subsidiaries
or any of their properties or assets, except such as does not constitute a
Material Adverse Effect.

(b)                                 None
of the Company and the Subsidiaries (i) is 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 or any of the
Subsidiaries), nor has the Company or any of the Subsidiaries received written
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 or assets is bound
(whether or not such default or violation has been waived) or (ii) is in
violation of any statute, rule or regulation of any governmental authority,
including, without limitation, all foreign, federal, state

 7
 

and local laws relating
to taxes, environmental protection, occupational health and safety, product
quality and safety, communications and employment and labor matters, except in
each case such as does not constitute a Material Adverse Effect.

3.10                           Brokers
or Finders.  Neither the Company nor
any of the Subsidiaries has dealt with any broker or finder in connection with
the transactions contemplated by this Agreement or the Transaction Documents,
and except as set forth in Schedule 2-3.10 to the Disclosure Schedule,
none of the Company and the Subsidiaries has incurred, or shall incur, directly
or indirectly, any liability for any brokerage or finders’ fees or agents’
commissions or any similar charges in connection with this Agreement or the
Transaction Documents, or any transaction contemplated hereby or thereby.

3.11                           Absence
of Litigation.  Except as set forth
in Schedule 2-3.11 to the Disclosure Schedule, there are no pending or,
to the Company’s knowledge, threatened actions, suits, claims, proceedings or
investigations against or involving the Company or any of the Subsidiaries,
which if adversely decided, would cause a Material Adverse Effect.

3.12                           No
Undisclosed Liabilities; Indebtedness. 
Except as set forth in Schedule 2-3.12, since the Financial
Statement Date, the Company and the Subsidiaries have incurred no liabilities
or obligations, whether known or unknown, asserted or unasserted, fixed or
contingent, accrued or unaccrued, matured or unmatured, liquidated or
unliquidated, or otherwise, other than liabilities and obligations that arose
in the ordinary course of business and do not constitute a Material Adverse
Effect.  Except for indebtedness
reflected in the Company’s Financial Statements and as set forth in Schedule
2-3.12 to the Disclosure Schedule, the Company has no indebtedness
outstanding, fixed or contingent, as of the date hereof.  The Company is not in default with respect to
any outstanding indebtedness or any instrument relating thereto.

3.13                           Contracts.  Except as set forth in Schedule 2-3.13,
none of the Company and the Subsidiaries are a party to any written or oral
executory contract or commitment not made in the ordinary course of business
and, whether or not made in the ordinary course of business, none of the
Company and the Subsidiaries are a party to any written or oral executory (i)
contract or commitment with any labor union, (ii) contract or commitment for
the future purchase of fixed assets, materials, supplies, or equipment
involving an amount in excess of $25,000, (iii) contract of commitment for the
employment of any executive officer or any contract with any other individual
for employment, consulting or other services involving an amount in excess of
$75,000 per year, (iv) bonus, pension, profit-sharing, retirement, stock
purchase, stock option, or extraordinary hospitalization, medical insurance or
similar plan, contract or understanding in effect with respect to employees or
any of them or the employees of others, (v) agreements, indentures or
commitments relating to the borrowing of money or to the mortgaging, pledging
or otherwise placing of a lien on any assets of the Company or a Subsidiary,
(vi) guaranty of any obligation for borrowed money or otherwise, (vii) lease or
agreement under which the Company or a Subsidiary is the lessee of any material
property, real or personal, or is the lessor of or permits any third party to
hold or operate, any material property, real or personal, owned or controlled
by the Company or a Subsidiary, (viii) agreement or other commitment for
capital expenditures in excess of $25,000 in the aggregate, (ix) contract or
agreement under which the Company or a Subsidiary is obligated to pay any
broker’s fees, finder’s fees or any such similar fees to any third party, (x)
contract, agreement or commitment

 8
 

under which the Company
or a Subsidiary has issued, or may become obligated to issue, any shares of
capital stock of the Company or a Subsidiary, or any warrants, options,
convertible securities or other commitments pursuant to which the Company or a
Subsidiary is or may become obligated to issue any shares of its capital stock,
or (xi) any other contract, agreement, arrangement or understanding which is
material to the business of the Company and the Subsidiaries, taken as a whole
(collectively (i) through (xi), “Material Contracts”).  The Company has furnished to counsel for the
Purchasers true and correct copies of the Material Contracts.  All Material Contracts are legal, valid,
binding and in full force and effect and are enforceable by the Company and the
relevant Subsidiaries in accordance with their respective terms, except as such
may be limited by bankruptcy, insolvency, reorganization or other laws
affecting creditors’ rights generally and by general equitable principles.

3.14                           Title
to Assets.  Each of the Company and
the Subsidiaries has good and marketable title to all real and personal
property owned by it that is material to the business of the Company and the
Subsidiaries, in each case, free and clear of all liens and encumbrances,
except those, if any, incurred in the ordinary course of business consistent
with past practice.

3.15                           Labor
Relations.  No labor or employment
dispute exists or, to the knowledge of the Company, is imminent or threatened,
with respect to any of the employees or consultants of the Company or a
Subsidiary that constitutes or will constitute a Material Adverse Effect.

3.16                           Intellectual
Property.

(a)
                               The
Company or a Subsidiary is the sole and exclusive owner of, or has the
exclusive right to use, all Intellectual Property used or contemplated for use
in the conduct of the Company’s business, including without limitation, the
Intellectual Property identified in Schedule 2-3.16(a)(1).  All Intellectual Property identified in Schedule
2-3.16(a)(1) was conceived, developed, reduced to practice or otherwise
made by or for the Company or a Subsidiary by the current or former employees,
consultants or independent contractors of the Company or a Subsidiary, or its
predecessors-in-interest (each of whom has validly assigned or is obligated to
assign all of his or her right, title and interest therein in writing to the
Company or a Subsidiary) or was purchased and is owned or licensed by the
Company or a Subsidiary, or its predecessors-in-interest, free and clear of
claims and rights of any other Person. 
Except as set forth in Schedule 2-3.16(a)(2) to the Disclosure
Schedule, there are no outstanding options, licenses, agreements, claims,
encumbrances or shared ownership of interests of any kind relating to any
Intellectual Property owned, licensed, conceived, developed, reduced to
practice or otherwise made by or for the Company or its Subsidiaries, including
without limitation the Intellectual Property identified in Schedule
2-3.16(a)(1).  Each of the Company
and the Subsidiaries has taken all commercially reasonable steps to establish
and preserve its ownership, and all rights in, any Intellectual Property owned,
licensed, conceived, developed, reduced to practice or otherwise made by or for
the Company or its Subsidiaries, including without limitation the Intellectual
Property listed in Schedule 2-3.16(a)(1).  All necessary registration, maintenance and
renewal fees for the Intellectual Property listed in Schedule 2-3.16(a)(1)
are currently satisfied.  All
assignments, security agreements, certifications or other relevant documents
and/or agreements that may affect any rights or interests of the Intellectual
Property

 9
 

identified in Schedule
2-3.16(a)(1) have been properly filed with the relevant patent, copyright,
trademark or other authority in the United States or relevant foreign jurisdiction.

(b)                                 To
the Company’s knowledge, there have been no claims made against the Company or
any of the Subsidiaries asserting the invalidity, abuse, misuse, or
unenforceability of any of the Company’s Intellectual Property or interference
of the Company’s Intellectual Property with the rights of others and, to the
Company’s knowledge, there are no reasonable grounds for any such claims.  To the Company’s knowledge, no Person
affiliated with the Company or the Subsidiaries has wrongfully acquired,
exploited, employed, disclosed, converted, misappropriated or used any trade
secrets or any confidential information or documentation proprietary to any
former employer or any other person, and no person affiliated with the Company
or the Subsidiaries has violated any confidential relationship which such
person may have had with any third party. 
To the Company’s knowledge, there have been no claims made against the
Company or its Subsidiaries, or against any activity, product, service or
offering of the Company or its Subsidiaries, for any infringement, misuse,
misappropriation, conversion or violation of any Intellectual Property rights
of any third party, and, to the Company’s knowledge, there are no reasonable
grounds for any such claims.  To the
Company’s knowledge, none of its planned activities, products, services or
offerings will infringe, misuse, misappropriate, convert or in any way violate
any Intellectual Property rights of any third party, and, to the Company’s
knowledge, there would be no reasonable grounds for any such claim.

(c)                                  Except
as set forth in Schedule 2-3.16(c), to the Company’s knowledge, no third
party has infringed, misused, misappropriated, converted or violated any of the
Company’s Intellectual Property.

(d)                                 Except
as set forth in Schedule 2-3.16(d) to the Disclosure Schedule, no
royalties, honorariums or fees are or will be payable by the Company or any of
the Subsidiaries to other Persons by reason of the ownership or use by the
Company (or by reason of any other relationship with other Persons, contractual
or otherwise) of the Intellectual Property or by reason of the conduct of its
normal business activities or marketing or sale of any of its existing or
planned products, services or activities.

3.17                           Subsidiaries;
Joint Ventures.  Except for the
Subsidiaries listed in Schedule 2-3.17 to the Disclosure Schedule, the
Company has no subsidiaries and (i) does not hold equity interests, directly or
indirectly, in any other Person or have any obligations to acquire equity
interests in any other Person, and (ii) is not a participant in any joint
venture, partnership, or similar arrangement material to the business of the
Company and the Subsidiaries.

3.18                           Taxes.  The Company and each of the Subsidiaries has
filed (or has had filed on its behalf), will timely file or will cause to be
timely filed, or has timely filed for an extension of the time to file, all
material Tax Returns (as defined below) required by applicable law to be filed
by it or them prior to or as of the date hereof, and such Tax Returns are, or
will be at the time of filing, true, correct and complete in all material
respects.  Each of the Company and the
Subsidiaries has paid (or has had paid on its behalf) or, where payment is not
yet due, has established (or has had established on its behalf and for its sole
benefit and recourse) or will establish or cause to be established in
accordance with United States generally accepted accounting principles on or
before the date hereof an adequate accrual for the payment of, all

 10
 

material Taxes (as
defined below) due with respect to any period ending prior to or as of the date
hereof.  “Taxes” shall mean any and all taxes,
charges, fees, levies or other assessments, including income, gross receipts,
excise, real or personal property, sales, withholding, social security,
retirement, unemployment, occupation, use, goods and services, license, value
added, capital, net worth, payroll, profits, franchise, transfer and recording
taxes, fees and charges, and any other taxes, assessment or similar charges
imposed by the Internal Revenue Service or any taxing authority (whether state,
county, local or foreign) (each, a “Taxing Authority”), including any interest,
fines, penalties or additional amounts attributable to or imposed upon any such
taxes or other assessments.  “Tax Return” shall
mean any report, return, document, declaration or other information or filing
required to be supplied to any Taxing Authority, including information returns,
any documents with respect to accompanying payments of estimated Taxes, or with
respect to or accompanying requests for extensions of time in which to file any
such return, report, document, declaration or other information. There are no
claims or assessments pending against the Company or any of the Subsidiaries for
any material alleged deficiency in any Tax, and neither the Company nor any of
the Subsidiaries has been notified in writing of any material proposed Tax
claims or assessments against the Company or any of the Subsidiaries. No Tax
Return of the Company or any of the Subsidiaries is or has been the subject of
an examination by a Taxing Authority. 
Each of the Company and the Subsidiaries has withheld from each payment
made to any of its past or present employees, officers and directors, and any
other person, the amount of all material Taxes and other deductions required to
be withheld therefrom and paid the same to the proper Taxing Authority within
the time required by law.

3.19                           Pensions
and Benefits.

(a)                                  None
of (i) any current or former directors, officers, employees or consultants of
the Company has any present or future right to benefits and which are
contributed to, sponsored by or maintained by the Company or any of the
Subsidiaries, or (ii) the Company or any of the Subsidiaries has any present or
future liability under any “employee benefit plan” within the meaning of
Section 3(3) of the United States Employee Retirement Income Security Act of
1974 (“ERISA”), including without
limitation, multiemployer plans within the meaning of Section 3(37) of ERISA,
and all retirement, profit sharing, stock option, stock bonus, stock purchase,
severance, fringe benefit, deferred compensation, and other employee benefit
programs, plans, or arrangements, whether or not subject to ERISA.

(b)                                 No
stock options, stock appreciation rights or other equity-based awards issued or
granted by the Company are subject to the requirements of Section 409A of the
Code.   Each “nonqualified deferred compensation plan” (as such term
is defined under Section 409A(d)(1) of the Code and the guidance thereunder)
under which the Company  makes, is obligated to make or promises to
make, payments (each, a “409A Plan”)
complies in all material respects, in both form and operation, with the
requirements of Section 409A of the Code and the guidance thereunder.  No
payment to be made under any 409A Plan is, or to the knowledge of the
Company will be, subject to the penalties of Section 409A(a)(1) of the
Code.

3.20                           Private
Placement; Communications with Purchasers. Neither the Company nor any person
acting on the Company’s behalf has sold or offered to sell or solicited any
offer to buy the Shares, Warrants, Warrant Shares or Conversion Shares by means
of any form of general solicitation or advertising.  None of the Company, its Affiliates and any
person

 11
 

acting on the Company’s
behalf has, directly or indirectly, at any time within the past six (6) months,
made any offer or sale of any security or solicitation of any offer to buy any
security under circumstances that would (i) eliminate the availability of the
exemption from registration under Regulation D, or other exemption, under the
Securities Act in connection with the offer, sale or issuance of the Shares,
Conversion Shares, Warrants or Warrant Shares as contemplated hereby or by the
terms of the Transaction Documents or (ii) cause the offering or issuance of
the Shares, Conversion Shares, Warrants or Warrant Shares pursuant to this
Agreement or any of the Transaction Documents to be integrated with prior
offerings by the Company for purposes of any applicable law, regulation or
stockholder approval provisions in a manner that would eliminate the
availability of the exemption described in the immediately preceding clause (i)
or require any stockholder approval, except as has been obtained pursuant to
the Exchange Act.

3.21                           Regulatory
Matters.  None of the Company and the
Subsidiaries is, or is an Affiliate of, or following the receipt of the
proceeds of this offering will be, an “investment company” within the meaning
of the Investment Company Act of 1940, as amended.  None of the Company and the Subsidiaries is a
United States real property holding corporation within the meaning of the
Foreign Investment in Real Property Tax Act of 1980.

3.22                           Material
Changes. Except as set forth in Schedule 2-3.22 to the Disclosure
Schedule, since the Financial Statement Date, the Company and the Subsidiaries,
taken as a whole, have conducted their business only in the ordinary course,
consistent with past practice, and since such date there has not occurred a Material
Adverse Effect.  Since the Financial
Statement Date and except as disclosed in Schedule 2-3.22 or pursuant
hereto or any Transaction Document, there has not occurred: (i) any amendment
or change in the charter documents or By-laws of the Company or the
Subsidiaries; (ii) any (A) incurrence, assumption or guarantee by the Company
or the Subsidiaries of any debt for borrowed money other than (x) equipment
leases made in the ordinary course of business, consistent with past practice
and (y) any such incurrence, assumption or guarantee with respect to an amount
of $25,000 or more; (B) issuance or sale of any securities convertible into or
exchangeable for securities of the Company or any Subsidiary other than to
directors, employees and consultants pursuant to existing equity compensation
or stock purchase plans of the Company and its Subsidiaries; (C) issuance or
sale of options or other rights to acquire from the Company or any of the
Subsidiaries, directly or indirectly, securities of the Company or any
Subsidiary or any securities convertible into or exchangeable for any such
securities, other than options issued to directors, employees and consultants
in the ordinary course of business, consistent with past practice; (D) issuance
or sale of any stock, bond or other corporate security other than to directors,
employees and consultants pursuant to existing equity compensation or stock
purchase plans of the Company and its Subsidiaries; (E) declaration or making
of any payment or distribution to stockholders or purchase or redemption of any
share of its capital stock or other security other than to or from directors,
officers and employees of the Company or the Subsidiaries as compensation for
or in connection with services rendered to the Company or the Subsidiaries (as
applicable) or for reimbursement of expenses incurred on behalf of the Company
or the Subsidiaries (as applicable); (F) sale, assignment or transfer of any of
its intangible assets except in the ordinary course of business, consistent with
past practice, or cancellation of any debt or claim except in the ordinary
course of business, consistent with past practice; (G) waiver of any right of
substantial value whether or not in the ordinary course of business; (H)
material change in officer compensation, except in the ordinary course of
business and consistent with past practice; or (I)

 12
 

other commitment (contingent or otherwise) to do any
of the foregoing; (iii) any creation, sufferance or assumption by the Company
or any of the Subsidiaries of any lien on any asset or any making of any loan,
advance or capital contribution to or investment in any Person, in an aggregate
amount which exceeds $25,000 outstanding at any time; (iv) any entry into,
amendment of, relinquishment, termination or non-renewal by the Company or the
Subsidiaries of any Material Contract, other than in the ordinary course of
business, consistent with past practice; or (v) any transfer or grant of a
right with respect to the Intellectual Property owned or licensed by the Company
or the Subsidiaries, except as among the Company and the Subsidiaries.

3.23                           Regulatory
Permits. The Company and the Subsidiaries possess all certificates,
approvals, authorizations, licenses, permits and other rights issued by the
appropriate federal, state, local or foreign regulatory authorities necessary
to conduct their businesses, now conducted or proposed to be conducted, except
where the failure to possess such permits does not constitute a Material
Adverse Effect (the “Material
Permits”), and the Company has not received any written notice
of proceedings relating to, or any basis for the denial, revocation or
modification of any Material Permits. 
All such Material Permits are in full force and effect and are not the
subject of any pending or, to the knowledge of the Company, threatened
challenge or other attack by appeal or direct proceeding or otherwise.

3.24                           Insurance.  The Company and the Subsidiaries are insured
by insurers of recognized financial responsibility against such losses and
risks and in such amounts as are prudent and customary for the business in
which the Company and the Subsidiaries are engaged. The Company has no reason
to believe that it will not be able to renew existing insurance coverage for
itself and the Subsidiaries as and when such coverage expires or to obtain
similar coverage from similar insurers as may be necessary or appropriate to
continue business.

3.25                           Disclosure.  All disclosure provided to the Purchasers
regarding the Company and the Subsidiaries, their business and the transactions
contemplated hereby, including the Schedules to this Agreement furnished by or
on behalf of the Company, are true and correct in all material respects.  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 4 hereof.

3.26                           Investigation.  It shall be no defense to an action for
breach of this Agreement that the Purchasers or their agents have (or have not)
made investigations into the affairs of the Company and the Subsidiaries or
that the Company did not or could not have known of the misrepresentation or
breach of warranty (unless expressly qualified by knowledge).  Damages for breach of a representation or
warranty or other provision of this Agreement shall not be diminished by any
alleged tax savings as a result thereof.

3.27                           Affiliate Transactions.

(a)                                  Other
than (i) standard employee benefits generally made available to all employees,
(ii) standard director and officer indemnification agreements approved by the
Board, (iii) agreements contemplated in Section 3.28 below, and (iv) as
set forth in Schedule 2-3.27(a) to the Disclosure Schedule, there are no
agreements, understandings or proposed

 13
 

transactions
between the Company and any of its officers, directors, consultants, employees,
shareholders or Affiliates.

(b)                                 Except
as set forth in Schedule 2-3.27(b) to the Disclosure Schedule, the
Company is not indebted, directly or indirectly, for deferred salary or other
compensation, money borrowed or otherwise, to any of the directors, officers,
employees or shareholders of the Company or a Subsidiary or to their respective
spouses or children or to any Affiliate of any of the foregoing, other than in
connection with expenses or advances of expenses incurred in the ordinary
course of business or employee relocation expenses and for other customary
employee benefits made generally available to all employees.  Except as set forth in Schedule 2-3.27(b)  to the Disclosure Schedule, none of the
Company’s directors, officers, employees, shareholders or any members of their
immediate families, or any Affiliate of the foregoing (i) is, directly or
indirectly, indebted to the Company or a Subsidiary, (ii) to the Company’s
knowledge, has any direct or indirect ownership interest in any firm or
corporation with which the Company or a Subsidiary has any business
relationship or dealings, or any firm or corporation which competes with the
Company or a Subsidiary (except ownership interests not exceeding two percent
(2%) of the outstanding capital stock of publicly traded companies), or (iii)
has any material commercial, industrial, banking, consulting, legal,
accounting, charitable or familial relationship with any of the Company’s
customers, suppliers, service providers, joint venture partners, licensees and
competitors.

3.28                           Confidential Information and Invention
Assignment Agreements.  Except as set forth in Schedule 2-3.28
to the Disclosure Schedule, each current and former director, officer,
employee, and, to the extent reasonably deemed necessary to protect the Company’s
interests, consultant of the Company or a Subsidiary has executed an agreement
with the Company or a Subsidiary regarding confidentiality and proprietary
information substantially in the form or forms delivered to the counsel for the
Purchasers (the “Confidential
Information Agreements”). 
No current or former director, officer, employee, or consultant has
excluded works or inventions from his or her assignment of inventions pursuant
to such employee’s or consultant’s Confidential Information Agreement.  The Company is not aware that any director,
officer, employee, or consultant is in violation thereof.  All employees of the Company and its
Subsidiaries actively and directly involved in any research and development
activities are required to and have executed employment agreements that
obligate them to assign to the Company and its Subsidiaries all rights in any
Intellectual Property conceived, developed, reduced to practice or in any way
made in the course of their employment or work and to assist and fully
cooperate in all activities, and execute any documents, necessary to secure,
preserve and perfect the Company’s rights and interests in any such
Intellectual Property.  All employees,
and, to the extent reasonably deemed necessary to protect the Company’s
interests, consultants and advisors, are and have been required to execute a
confidentiality agreement upon the commencement of an employment or consulting
relationship, which agreement provides that all trade secrets and inventions
conceived by the individual and all confidential information developed or made
known to the individual during the term of his or her relationship with the
Company or its subsidiaries shall be the exclusive property of the Company or
its Subsidiaries and shall be kept confidential and not disclosed to third
parties, except in specified circumstances.

 14
 

3.29                           Nondisclosure.  Except as set forth in Schedule 2-3.29
or pursuant to a binding non-disclosure agreement, the Company has not
disclosed to any third party any Company trade secret or other confidential or
proprietary information.

3.30                           Collaboration.  Except as set forth in Schedule 2-3.30,
the Company has not funded any research or development efforts of any third
party or engaged in any joint research or development efforts with any third
party.

3.31                           Government
Funding.  Except for the agreements
set forth in Schedule 2-3.31, the Company is not a party to any
agreement that provided or provides government funding for any Company
research, development or marketing efforts, joint or otherwise.  The Company has complied with all provisions
of the agreements set forth in Schedule 2-3.31 necessary to preserve its
rights in any of the Company’s Intellectual Property.  Except for the agreements set forth in Schedule
2-3.31, the Company is not a party to any agreement with any government
that (a) provides for any governmental ownership interest, contingent or otherwise,
in any Company Intellectual Property, (b) that imposes on the Company any
requirement to license, contingent or otherwise, any of its Intellectual
Property, or (c) that imposes any governmental requirement, restriction or
encumbrance, contingent or otherwise, on the use of the Company’s Intellectual
Property or the conduct of the business of the Company.

4.                                       Representations
and Warranties of the Purchasers. 
Each Purchaser represents and warrants, severally (as to itself) and not
jointly, to the Company as follows:

4.1                                 Authorization.  All action on the part of such Purchaser and,
if applicable, its officers, directors, managers, members, shareholders and/or
partners necessary for the authorization, execution, delivery and performance
of this Agreement and the Investors’ Rights Agreement, and the consummation of
the transactions contemplated herein and therein, has been taken. When executed
and delivered, each of this Agreement and the Investors’ Rights Agreement will
constitute the legal, valid and binding obligation of such Purchaser,
enforceable against such Purchaser in accordance with its terms, except as such
may be limited by bankruptcy, insolvency, reorganization or other laws
affecting creditors’ rights generally and by general equitable principles.  Such Purchaser has all requisite power and
authority to enter into each of this Agreement and the Investors’ Rights
Agreement, and to carry out and perform its obligations under the terms hereof
and thereof.

4.2                                 Purchase
Entirely for Own Account.  Such
Purchaser is acquiring the Shares and the Warrants for its own account for
investment and not for resale or with a view to distribution thereof in
violation of the Securities Act.

4.3                                 Investor
Status; Etc.  Such Purchaser
certifies and represents to the Company that it is an institutional “Accredited
Investor” as such term is defined in Rule 501 of Regulation D
promulgated under the Securities Act and was not organized for the purpose of
acquiring any of the Shares, Conversion Shares, Warrants or Warrant Shares.  Such Purchaser’s financial condition is such
that it is able to bear the risk of holding the Shares and the Warrants, and
any Conversion Shares and Warrant Shares, for an indefinite period of time and
the risk of loss of its entire investment. Such Purchaser has sufficient
knowledge and experience in making investments such as contemplated under this
Agreement so as to be able to evaluate the risks and merits of its investment
in the Company.

 15

4.4                                 Securities
Not Registered.  Such Purchaser
understands that the Shares, Conversion Shares, Warrants and Warrant Shares
have not been registered under the Securities Act, by reason of their issuance
by the Company in transactions exempt from the registration requirements of the
Securities Act, and that the Shares, Conversion Shares, Warrants and Warrant
Shares must continue to be held by such Purchaser unless a subsequent
disposition thereof is registered under the Securities Act, including pursuant
to a registration statement under the Investors’ Rights Agreement, or is exempt
from such registration. Such Purchaser understands that the exemptions from
registration afforded by Rule 144 promulgated under the Securities Act (the
provisions of which are known to it) depend on the satisfaction of various
conditions, and that, if applicable, Rule 144 may afford the basis for sales
only in limited amounts.

4.5                                 No
Conflict.  The execution and delivery
of this Agreement and the Investors’ Rights Agreement by such Purchaser, and
the consummation of the transactions contemplated hereby and thereby, do not
and will not conflict with or result in any violation of (i) the organizational
documents of such Purchaser or (ii) any judgment, order, statute, law,
ordinance, rule or regulations, applicable to such Purchaser.

4.6                                 Brokers.  Such Purchaser has not retained, utilized or
been represented by any broker or finder in connection with the transactions
contemplated by this Agreement or the Transaction Documents, and such Purchaser
has not incurred, and shall not incur, directly or indirectly, any liability
for any brokerage or finders’ fees or agents’ commissions or any similar
charges in connection with this Agreement or the Transaction Documents, or any
transaction contemplated hereby or thereby.

4.7                                 Consents.  All consents, approvals, orders and
authorizations required on the part of such Purchaser in connection with such
Purchaser’s execution, delivery or performance of this Agreement and the
Investors’ Rights Agreement and the consummation of the transactions
contemplated herein and therein have been obtained and are effective as of the
date hereof.

4.8                                 Regulatory
Permits.  Such Purchaser possess all
certificates, approvals, authorizations and permits issued by the appropriate
federal, state, local or foreign regulatory authorities necessary for Purchaser
to enter into this Agreement and the Investors’ Rights Agreement and the
consummate the transactions contemplated herein and therein.

4.9                                 Disclosure
of Information.  Such Purchaser
believes it has received adequate information for it to decide whether or not
to purchase the Shares and the Warrants. 
Such Purchaser further represents that it has had an opportunity to ask
questions and receive answers from the Company regarding the terms and
conditions of the offering of the Shares and the Warrants and the business,
properties, prospects and financial condition of the Company.  The foregoing representation is made by such
Purchaser on the basis of and in reliance upon the representations and
warranties of the Company in Section 3 of this Agreement being true and
correct, and shall not operate to limit or otherwise modify such
representations and warranties or the right of such Purchaser to rely
thereon.  Such Purchaser’s decision to
invest is based exclusively on the Company’s representations in this Agreement
and the results of such

 16
 

Purchaser’s
independent investigation.  Such
Purchaser acknowledges that the Company and its agents have not provided any
legal or tax advice.

5.                                       Conditions
Precedent.

5.1.                              Conditions
to the Several Obligations of the Purchasers to Consummate the Closing.  The obligation of each Purchaser to
consummate the Closing and to purchase and pay for the Shares and Warrants to
be purchased by it is subject to the satisfaction (or waiver by such Purchaser)
of the following conditions precedent:

(a)                                  The
representations and warranties of the Company contained herein shall be true
and correct on and as of the date hereof, the Closing Date.  The Company shall have performed or complied
with all obligations and conditions herein required to be performed or complied
with by the Company on or prior to the Closing.

(b)                                 No
proceeding challenging, or seeking to prohibit, alter, prevent or materially
delay, this Agreement or the Transaction Documents, or the transactions
contemplated hereby or thereby, shall have been instituted before any court,
arbitrator or governmental body, agency or official or shall be pending against
or involving the Company.

(c)                                  This
Agreement and the Transaction Documents, and the transactions contemplated
hereby and thereby, shall not be prohibited by any law, rule, governmental
order or regulation.  All necessary
consents, approvals, licenses, permits, orders and authorizations of, or
registrations, declarations and filings with, any governmental or
administrative agency or of or with any other Person with respect to any of the
transactions contemplated hereby and thereby shall have been duly obtained or
made and shall be in full force and effect.

(d)                                 All
instruments and corporate proceedings of the Company in connection with the
transactions contemplated by this Agreement and the Transaction Documents shall
be satisfactory in form and substance to such Purchaser, and such Purchaser
shall have received copies (executed or certified, as may be appropriate) of
all documents which any Purchaser may have reasonably requested in connection
with such transactions.

(e)                                  Such
Purchaser shall have received from Jones, Walker, Waechter, Poitevent, Carrère
& Denègre, L.L.P., outside counsel to the Company, an opinion addressed to
such Purchaser, dated the Closing Date and substantially in the form of Exhibit
E hereto.

(f)                                    The
Investors’ Rights Agreement shall have been executed and delivered to such
Purchaser by the Company.

(g)                                 The
Company shall have adopted and filed with the Secretary of State of the State
of Delaware in accordance with Delaware General Corporation Law on or before
the Closing the Certificate of Designations, which shall continue in full force
and effect on and as of the Closing Date.

(h)                                 Each
of the Warrant Amendments shall have been executed and

 17
 

delivered to such
Purchaser by the Company.

(i)                                     Such
Purchaser shall have received evidence satisfactory to it that the lenders
under the Bridge Loans have waived their right to convert such Bridge Loans
into Common Stock or any other capital stock of the Company.

(j)                                     The
Company shall have delivered, in form and substance satisfactory to such
Purchaser, a certificate dated as of the Closing Date and signed by the
secretary or another appropriate executive officer of the Company, certifying
(i) that attached copies of the Certificate of Incorporation (including the
Certificate of Designations), By-laws and resolutions of the Board approving
this Agreement, the Transaction Documents and the transactions contemplated
hereby and thereby, are all true, complete and correct and remain in full force
and effect as of the date hereof, and (ii) as to the incumbency and specimen
signature of each officer of the Company executing this Agreement, the
Transaction Documents and any other document delivered in connection herewith
on behalf of the Company.

(k)                                  The
Company shall deliver to such Purchaser a certificate in form and substance
satisfactory to such Purchaser, dated the Closing Date and signed by the
Company’s President, certifying that (i) the representations and warranties of
the Company contained in Section 3 hereof are true and correct in all
respects on the Closing Date and (ii) the Company has performed and complied
with all of the agreements and conditions set forth or contemplated herein that
are required to be performed or complied with by the Company on or before the
Closing.

5.2.                              Conditions
to the Obligation of the Company to Consummate the Closing. The obligation
of the Company to consummate the Closing and to issue and sell the Shares to
each Purchaser at the Closing is subject to the satisfaction (or waiver by the
Company) of the following conditions precedent:

(a)                                  The
representations and warranties of the Purchasers contained herein shall be true
and correct in all respects on and as of the date hereof and the Closing Date.

(b)                                 The
Investors’ Rights Agreement shall have been executed and delivered by the
Purchasers.

(c)                                  The
Purchasers shall have performed all obligations and conditions herein required
to be performed or complied with by the Purchasers on or prior to the Closing.

(d)                                 No
proceeding challenging, or seeking to prohibit, alter, prevent or materially
delay, this Agreement or the Transaction Documents, or the transactions
contemplated hereby or thereby, shall have been instituted before any court,
arbitrator or governmental body, agency or official or shall be pending against
or involving such Purchaser.

(e)                                  This
Agreement and the Transaction Documents, and the transactions contemplated
hereby and thereby, shall not be prohibited by any law, rule, governmental
order or regulation.  All necessary
consents, approvals, licenses, permits, orders and authorizations of, or
registrations, declarations and filings with, any governmental or

 18
 

administrative agency or
of or with any other Person with respect to any of the transactions
contemplated hereby and thereby shall have been duly obtained or made and shall
be in full force and effect.

6.                                       Certain
Covenants and Agreements.

6.1.                              Transfer
of Securities.  Each Purchaser
agrees, severally (as to itself only) and not jointly, that it shall not sell,
assign, pledge, transfer or otherwise dispose of or encumber any of the Shares,
Conversion Shares, Warrants or Warrant Shares, except (i) pursuant to an
effective registration statement under the Securities Act, including such as
required under the Investors’ Rights Agreement, or (ii) pursuant to an
available exemption from registration under the Securities Act (including sales
permitted pursuant to Rule 144) and applicable state securities laws.  Any transfer or purported transfer of the
Shares in violation of this Section 6.1 shall be void. The Company shall
not be required to register any transfer of the Shares in violation of this Section
6.1.  The Company may, and may
instruct any transfer agent for the Company, to place such stop transfer orders
as may be required on the transfer books of the Company in order to ensure
compliance with the provisions of this Section 6.1.

6.2.                              Legends.

(a)                                  To
the extent applicable, each certificate or other document evidencing the
Shares, the Conversion Shares and the Warrant Shares shall be endorsed with the
legend set forth below and any other legends that may be required by applicable
state “blue sky” laws, and each Purchaser covenants that, except to the extent
such restrictions are waived by the Company, it shall not transfer the shares
represented by any such certificate without complying with the restrictions on
transfer described in this Agreement and the legends endorsed on such
certificate:

THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE
OFFERED OR SOLD IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER
SAID ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT
SUBJECT TO, REGISTRATION UNDER SAID ACT.

(b)                                 The
legend set forth in Section 6.2(a) shall be removed from the
certificates evidencing the Shares, the Conversion Shares and the Warrant
Shares, (i) in connection with any sale of such Shares, Conversion Shares or
Warrant Shares pursuant to Rule 144 or any effective registration statement,
including such as required under the Investors’ Rights Agreement, or (ii) if
such Shares, Conversion Shares or Warrant Shares are eligible for sale under
Rule 144(k) (and the holder of such Shares, Conversion Shares or Warrant Shares
has submitted a written request for removal of the legend indicating that the
holder is in compliance with the applicable provisions of Rule 144(k)) or (iii)
if such legend is not required under applicable requirements of the Securities
Act (including interpretations and pronouncements issued by the Staff of the
SEC) (and the holder of such Shares, Conversion Shares or Warrant Shares has
submitted a written request for removal of the legend indicating that such
legend is not required under applicable requirements of the Securities Act
(including such interpretations 

 19
 

and pronouncements)) and,
if reasonably requested by the Company, the Company has received from Purchaser’s
counsel an opinion, in such form as is reasonably satisfactory to Company’s
counsel, that such legend is not so required. 
The Company shall cause its counsel to issue a legal opinion to the
Company’s transfer agent, if required, promptly upon the occurrence of any of
the events in clauses (i), (ii) or (iii) above to effect the removal of the
legend on certificates evidencing the Shares, the Conversion Shares or the
Warrant Shares and shall also cause its counsel to issue a “blanket” legal
opinion to the Company’s transfer agent, if required, promptly after the
effective date of any registration statement, including such as required under
the Investors’ Rights Agreement, covering the resale of the Shares, any
Conversion Shares or Warrant Shares to allow sales without restriction pursuant
to such registration statement. The Company agrees that at such time as such
legend is no longer required under this Section 6.2(b), it will, promptly
following the delivery by a Purchaser to the Company or the Company’s transfer
agent of a certificate representing the Shares, Conversion Shares or Warrant
Shares issued with such legend, deliver or cause to be delivered to such
Purchaser a certificate representing such Shares, Conversion Shares or Warrant
Shares that is free from such legend; provided, however,
that in the case of removal of the legend in connection with a sale pursuant to
Rule 144, the holder of such Shares, Conversion Shares or Warrant Shares has
submitted a written request for removal of the legend indicating that the
holder has complied with the applicable provisions of Rule 144, including
delivery of a broker’s representation letter and a copy of a Form 144 filed in
connection with such sale. The Company may not make any notation on its records
or give instructions to any transfer agent of the Company that enlarge the
restrictions on transfer set forth in this Section.

6.3                                 Publicity.
Except to the extent required by applicable laws, rules, regulations or stock
exchange requirements, the Company shall not, without the prior written consent
of each of the Purchasers, disclose or publish the name of such Purchaser in
any press release, public announcement, website or otherwise.  Except to the extent required by applicable
laws, rules, regulations or stock exchange requirements, each of the Purchasers
and their Affiliates shall not, without the written consent of the Company,
make any public announcement or issue any press release with respect to the
transactions contemplated by this Agreement. 
The parties agree that the Company shall issue a press release promptly
following (and in no event more than one Business Day after) the Closing and,
on or before 9:30 a.m., New York time, on the first trading day following the
Closing Date describing the terms of the transactions contemplated by this
Agreement and the Transaction Documents, the contents of which press release
shall have been approved by the Purchasers, and shall file such press release
under cover of a Current Report on Form 8-K, attaching such press release and
the material transaction documents (including, without limitation, this
Agreement and the Investors’ Rights Agreement) as exhibit to such filing
(including all attachments, the “8-K Filing”).

6.4                                 Filing
of Information.  The Company
covenants to timely file (or obtain extensions in respect thereof and file
within the applicable grace period) all reports required to be filed by the
Company pursuant to all applicable securities laws, including the Exchange
Act.  The Company further covenants that
it will take such further action as any holder of Shares, Conversion Shares and
Warrant Shares may reasonably request to satisfy the provisions of Rule 144
applicable to the issuer of securities relating to transactions for the sale of
securities pursuant to Rule 144.

 20
 

6.5                                 Use
of Proceeds.  The Company intends
that the proceeds from the sale of the Shares shall be used by the Company to
(i) repay in full the Bridge Loans, and (ii) fund the Company’s general
corporate and working capital requirements. 
The Company shall repay in full the Bridge Loans within three (3)
Business Days of the Closing Date.

6.6                                 Integration.  The Company shall not sell, offer for sale or
solicit offers to buy or otherwise negotiate in respect of any security (as
defined in Section 2 of the Securities Act) that would be integrated with the
offer or sale of the Shares in a manner that would require the registration
under the Securities Act of the sale of the Shares or the issuance of the
Warrants pursuant hereto.

6.7                                 Reservation
of Common Stock for Issuance; Listing of Shares.  The Company agrees to reserve from its duly
authorized capital stock the total number of shares of Common Stock issuable
upon the conversion in full of the Conversion Shares and the Warrant
Shares.  The Company agrees that at any
time, if and when its shares of Common Stock are listed on a national or
international securities exchange or admitted for quotation on any national
automated quotation system, it will use reasonable efforts to promptly list and
qualify the Conversion Shares and Warrant Shares for trading on such exchange
or quotation on such system.

6.8                                 Required
Approvals.  As promptly as
practicable after the date of this Agreement, the Company shall make, or cause
to be made, all filings with any governmental or administrative agency or any
other Person necessary to consummate the transactions contemplated hereby.

6.9                                 Inspection
Rights.  Each Purchaser, or any
officer, employee, agent or representative thereof, shall have the right to
visit and inspect any of the properties of the Company or any of the
Subsidiaries, to discuss the affairs, finances, accounts and operations of the
Company or any of the Subsidiaries with their respective officers, directors,
employees, agents or representatives, and to review and copy such information
as is reasonably requested from time to time.

6.10                           No Commitment for Additional Financing.  The
Company acknowledges and agrees that no Purchaser has made any representation,
undertaking, commitment or agreement to provide or assist the Company in
obtaining any financing, investment or other assistance, other than the
purchase of the Shares and the Warrants as set forth herein and subject to the
conditions set forth herein.  In
addition, the Company acknowledges and agrees that (i) no statements,
whether written or oral, made by any Purchaser or its representatives on or
after the date of this Agreement shall create an obligation, commitment or
agreement to provide or assist the Company in obtaining any financing or
investment, (ii) the Company shall not rely on any such statement by any
Purchaser or its representatives and (iii) an obligation, commitment or
agreement to provide or assist the Company in obtaining any financing or
investment may only be created by a written agreement of such Purchaser,
setting forth the terms and conditions of such financing or investment and
stating that the parties intend for such writing to be a binding obligation or
agreement.  Each Purchaser shall have the
right, in it sole and absolute discretion, to refuse or decline to participate
in any other financing of or investment in the Company, and shall have no
obligation to assist or cooperate with the Company in obtaining any financing,

 21
 

investment
or other assistance.

6.11                           CEO
Search.  The Company shall commence,
promptly after the Closing, a search for a new Chief Executive Officer to be
appointed as soon as reasonably practicable, with the approval of the Board,
including at least one Series B Director (as defined in the Certificate of
Designations), if any are on the Board at such time.

6.12                           Series
A Preferred.  The Company shall send,
not later than three (3) Business Days after the Closing Date, a notice to all
holders of record of shares of Series A Preferred Stock relating to the
adjustment of the conversion price for the Series A Preferred Stock that
complies with Section 5(j) of the Certificate of Designations of the Series A
Preferred Stock.

7.                                       Indemnification.

7.1                                 The
Company agrees to indemnify, defend and hold harmless each Purchaser and its
Affiliates and their respective officers, directors, agents, employees,
subsidiaries, partners, members and controlling persons (collectively, the “Purchaser Indemnitees”)
to the fullest extent permitted by law from and against any and all claims,
losses, liabilities, damages, deficiencies, judgments, assessments, fines,
settlements, costs or expenses (including administrative, judicial or
regulatory proceedings, interest, penalties, costs of investigation and
reasonable fees, disbursements and other charges of counsel) (collectively, “Losses”) based upon,
arising out of or otherwise in respect of any breach by the Company of any
representation, warranty, covenant or agreement of the Company contained in
this Agreement or in the Transaction Documents, or for any Losses claimed by
any broker or placement agent retained by the Company in connection with the
transactions contemplated hereby or thereby.

7.2                                 As
promptly as possible after receipt by a Purchaser Indemnitee under this Section
7 of notice of the threat, assertion or commencement of any claim, action
or proceeding, such Purchaser Indemnitee will, if a claim for indemnification
in respect thereof is to be made under this Section 7, notify the
Company in writing of the commencement thereof and the Company shall have the
right to participate in and, to the extent the Company desires, to assume at
its expense the defense thereof with counsel mutually satisfactory to the
parties; provided, however,
that the failure to notify the Company promptly of the threat, assertion or
commencement of any such claim, action or proceeding shall not relieve the
Company of any liability to the Purchaser Indemnitee under this Section 7
except (and only) to the extent that it shall be finally determined by a court
of competent jurisdiction (which determination is not subject to appeal or
further review) that such failure shall have proximately and materially
adversely prejudiced the Company.

7.3                                 If any Purchaser Indemnitee shall have
reasonably concluded that there may be one or more legal defenses available to
such Purchaser Indemnitee which are different from or additional to those
available to the Company, or that such claim or litigation involves or could
have an effect upon matters beyond the scope of the indemnity agreement
provided in this Section 7, the Company shall not have the right to
assume the defense of such action on behalf of such Purchaser Indemnitee, and
the Company shall reimburse such Purchaser Indemnitee for the

 22
 

fees
and expenses of one separate counsel, for all Purchaser Indemnitees, which are
reasonably related to the matters covered by the indemnity agreement provided
in this Section 7.  Subject to the
foregoing, a Purchaser Indemnitee shall have the right to employ separate
counsel in any such action and to participate in the defense thereof but the
fees and expenses of such counsel shall not be at the expense of the
Company.  The Company shall not be liable
for any settlement of any proceeding effected without its written consent,
which consent shall not be unreasonably withheld.  The Company shall not, without the prior
written consent of the relevant Purchaser Indemnitee, effect any settlement of
any pending proceeding in respect of which such Purchaser Indemnitee is a
party, unless such settlement includes an unconditional release of such
Purchaser Indemnitee party from all liability on claims that are the subject
matter of such proceeding.

7.4.                              Time
Limit for Certain Claims.

(a)                                  The
representations and warranties of the Company under Section 3 of this
Agreement, regardless of any investigation made by the Purchasers or their
independent accounts or legal representatives, or any certificate, document or
other instrument delivered in connection herewith, shall survive for eighteen
(18) months after the Closing, except for (i) the representations and
warranties in Section 3.18 hereof (“Taxes”),
which shall survive until the last date liability connected with the Company’s
previous tax positions may be asserted by federal or state authorities, and
(ii) the representations and warranties in Sections 3.1, 3.4 and 3.5
hereof, which shall survive indefinitely. 
The Company will not be liable for any Losses hereunder arising out of a
breach of representation or warranty unless a written claim for indemnification
is given by the relevant Purchaser Indemnitee to the Company on or prior to the
expiration of such applicable time limits.

(b)                                 Maximum
Amount.  The Company shall not be
liable hereunder for any Losses incurred by any Purchaser on the value of its
Shares and Warrant Shares as a result of a breach of representation or warranty
hereunder in excess of purchase price hereunder actually paid by such Purchaser
for such Shares and Warrant Shares.

7.5                                 Applicability;
Non-Exclusivity.  Notwithstanding any
term to the contrary in this Section 7, the indemnification and
contribution provisions of the Investors’ Rights Agreement shall govern any
claim made with respect to registration statements filed pursuant thereto or
sales made thereunder.  The parties
hereby acknowledge and agree that in addition to remedies of the parties hereto
in respect of any and all claims relating to any breach or purported breach of
any representation, warranty, covenant or agreement that is contained in this
Agreement pursuant to the indemnification provisions of this Section 7,
all parties shall always retain the right to pursue and obtain injunctive
relief in addition to any other rights or remedies hereunder.

8.                                       Miscellaneous
Provisions.

8.1                                 Rights
Cumulative.  Each and all of the
various rights, powers and remedies of the parties shall be considered to be
cumulative with and in addition to any other rights, powers and remedies which
such parties may have at law or in equity in the event of the breach of any of
the terms of this Agreement.  The
exercise or partial exercise of any right, power or remedy shall neither
constitute the exclusive election thereof nor the waiver of any

 23
 

other right, power or
remedy available to such party.

8.2                                 Pronouns.  All pronouns or any variation thereof shall
be deemed to refer to the masculine, feminine or neuter, singular or plural, as
the identity of the person, persons, entity or entities may require.

8.3                                 Notices.

(a)                                  Any
notices, reports or other correspondence (hereinafter collectively referred to
as “correspondence”) required or permitted to be given hereunder shall be given
in writing and shall be deemed given if sent by certified or registered mail
(return receipt requested), overnight courier or telecopy (with confirmation of
receipt), or delivered by hand to the party to whom such correspondence is
required or permitted to be given hereunder. 
An electronic communication (“Electronic Notice”) shall be deemed written
notice for purposes of this Section 8.3 if sent with return receipt
requested to the electronic mail address specified by the receiving party
either in this Section 8.3 or on Schedule 1 hereto.  Electronic Notice shall be deemed received at
the time the party sending Electronic Notice receives verification of receipt
by the receiving party.

(b)                                 All
correspondence to the Company shall be addressed as follows:

Uni-Pixel, Inc.

8708 Technology Forest
Place

Suite 100

The Woodlands,
Texas 77381

Attention: James
Tassone, President

Facsimile: (281)
825-4599

Email:
jtassone@unipixel.com

with copies to:

Jones, Walker, Waechter,
Poitevent, Carrère & Denègre, L.L.P.

Four United Plaza

8555 United Plaza
Boulevard

Baton Rouge, LA 70809

Attention: Scott D.
Chenevert, Esq.

Facsimile: (225) 248-2010

Email: schenevert@joneswalker.com

(c)                                  All
correspondence to the Purchasers shall be addressed pursuant to the contact
information set forth in Schedule 1 attached hereto.

(d)                                 Any
entity may change the address to which correspondence to it is to be addressed
by notification as provided for herein.

8.4                                 Captions.  The captions and paragraph headings of this
Agreement are solely for the convenience of reference and shall not affect its
interpretation.

 24
 

8.5                                 Expenses.  Each party shall pay all costs and expenses
that it incurs with respect to the negotiation, execution, delivery and
performance of this Agreement and the Transaction Documents; provided, however, that
the Company shall, at the Closing, reimburse the reasonable fees and expenses
of Boies, Schiller & Flexner LLP, counsel to the Purchasers, not to exceed
$62,500.

8.6                                 Severability.  Should any part or provision of this
Agreement be held unenforceable or in conflict with the applicable laws or
regulations of any jurisdiction, the invalid or unenforceable part or
provisions shall be replaced with a provision which accomplishes, to the extent
possible, the original business purpose of such part or provision in a valid
and enforceable manner, and the remainder of this Agreement shall remain binding
upon the parties hereto.

8.7                                 Governing
Law.  This Agreement shall be
governed by and construed in accordance with the internal and substantive laws
of the State of Delaware and without regard to any conflicts of laws concepts
which would apply the substantive law of some other jurisdiction.  The Company agrees that any action for the
breach of this Agreement prosecuted against it in the courts of the State of
New York.

8.8                                 Waiver.  No waiver or delay in exercising of any term,
provision or condition of this Agreement, whether by conduct or otherwise, in
any one or more instances, shall be deemed to be, or be construed as, a further
or continuing waiver of any such term, provision or condition or as a waiver of
any other term, provision or condition of this Agreement.

8.9                                 Assignment.  The rights and obligations of any party
hereto shall inure to the benefit of and shall be binding upon the authorized
successors, legal representatives, and permitted assigns of such party.  The Company may not assign this Agreement or
any rights or obligations hereunder without the prior written consent of the
Purchasers.  Subject to the provisions of
Section 6 hereof, each Purchaser may assign or transfer any or all of
its rights under this Agreement to any Person to which it may sell, assign,
transfer or otherwise dispose of any of its Shares, Conversion Shares, Warrants
or Warrant Shares; provided, however,
that such assignee or transferee agrees in writing to be bound, with respect to
the transferred Shares, Conversion Shares, Warrants or Warrant Shares, by the
provisions hereof and of the Transaction Documents that apply to such assigning
or transferring Purchaser; whereupon such assignee or transferee shall be
deemed to be a “Purchaser”
for all purposes of this Agreement.

8.10                           Survival.  The respective representations and warranties
given by the parties hereto shall survive the Closing Date and the consummation
of the transactions contemplated herein as provided in Section 7.4 of
this Agreement.  The respective covenants
and agreements agreed to by a party hereto shall survive the Closing Date and
the consummation of the transactions contemplated herein in accordance with
their respective terms and conditions.

8.11                           Entire
Agreement.  This Agreement, the
exhibits and schedules hereto, the Transaction Documents and the other
documents delivered pursuant hereto constitutes the entire agreement between
the parties hereto respecting the subject matter hereof and supersedes all
prior agreements, negotiations, understandings, representations and statements
respecting the

 25
 

subject matter hereof,
whether written or oral.

8.12                           Amendments.  Any amendment, supplement or modification of
or to any provision of this Agreement, any waiver of any provisions of this
Agreement shall be effective only if made or given in writing and signed by the
Company and the Purchasers.

8.13                           No
Third Party Rights.  This Agreement
is intended solely for the benefit of the parties hereto and is not intended to
confer any benefits upon, or create any rights in favor of, any Person
(including, without limitation, any stockholder or debt holder of the Company)
other than the parties hereto; provided, however, that each of the Purchaser Indemnitees that are not
Purchasers are entitled to all rights and benefits as third party beneficiaries
of Section 7 of this Agreement.

8.14                           Counterparts.
This Agreement may be executed in any number of counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same document.  The parties hereto
confirm that any facsimile copy of another party’s executed counterpart of this
Agreement (or its signature page thereof) will be deemed to be an executed
original thereof.

[Signature
Pages Follow]

 26

IN WITNESS
WHEREOF, the parties hereto have executed this Securities Purchase Agreement
under seal as of the day and year first above written.

	
  

  	
  UNI-PIXEL, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Reed J. Killion

  	
   

  
	
   

  	
   

  	
  Name: Reed J. Killion

  
	
   

  	
   

  	
  Title: President

  

 

 

	
  

  	
  PURCHASERS:

  
	
   

  	
   

  
	
   

  	
  TUDOR INVESTMENT CORP., as investment adviser to
  each Purchaser listed on Schedule 1 (other than Tudor Proprietary Trading,
  L.L.C.)

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David I. Ginsberg

  	
   

  
	
   

  	
   

  	
  Name:

  	
  David I. Ginsburg

  
	
   

  	
   

  	
  Title:

  	
  Managing Director, Special

  
	
   

  	
   

  	
   

  	
  Opportunities Group

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  TUDOR PROPRIETARY TRADING, L.L.C.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David I. Ginsberg

  	
   

  
	
   

  	
   

  	
  Name:

  	
  David I. Ginsburg

  
	
   

  	
   

  	
  Title:

  	
  Managing Director, Special

  
	
   

  	
   

  	
   

  	
  Opportunities Group

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