Document:

WARRANT
      CLARIFICATION AGREEMENT 

     

    This
      Warrant Clarification Agreement (this “Agreement”), dated as of __________,
      2008, to the Restated Warrant Agreement, made as of August 14, 2007 (the
“Warrant Agreement”) is made and entered into by and between NeoStem, Inc., a
      Delaware corporation with offices at 420 Lexington Avenue, New York, New York
      10170 (“Company”) and Continental Stock Transfer & Trust Company, a New York
      corporation, with offices at 17 Battery Place, New York, New York 10004
      (“Warrant Agent”).

    

    WHEREAS,
      Section
      3.3.2 of the Warrant Agreement provides that Company shall not be obligated
      to
      deliver any securities pursuant to the exercise of a Warrant unless a
      registration statement under the Securities Act of 1933, as amended
      (‘‘Securities Act’’), with respect to the Common Stock is
      effective.

     

    WHEREAS,
      the
      Warrant Agreement does not contain any provisions granting registered holders
      of
      Warrants the right to receive any cash or other consideration or otherwise
“net
      cash settle” the Warrants in the event securities cannot be issued upon exercise
      of the Warrants.

     

    WHEREAS,
      in
      furtherance of the foregoing, the Company’s final prospectus, dated July 16,
      2007, indicated that (i) for a warrant holder to be able to exercise their
      warrant, the shares of common stock underlying the warrant must be covered
      by an
      effective and current registration statement and qualify or be exempt under
      the
      securities laws of the state or other jurisdiction in which the holder lives,
      (ii) the Company cannot assure prospective warrant holders that it will continue
      to maintain a current registration statement relating to the shares of common
      stock underlying the warrants or that an exemption from registration or
      qualification will be available throughout their term, and (iii) this may have
      an adverse effect on demand for the warrants and the prices that could be
      obtained from reselling them.

     

    WHEREAS,
      as a
      result of certain questions that have arisen regarding the accounting treatment
      applicable to the warrants, the parties hereto deem it necessary and desirable
      to amend the Warrant Agreement to clarify and confirm that the registered
      holders do not have the right to receive a net cash settlement in the event
      the
      Company does not maintain a current prospectus relating to the common stock
      issuable upon exercise of the warrants at the time such warrants are
      exercisable.

     

    NOW,
      THEREFORE,
      in
      consideration of the mutual agreements contained herein and other good and
      valuable consideration, the receipt and sufficiency of which are hereby
      acknowledged, and intending to be legally bound hereby, the parties hereto
      agree
      to amend the Warrant Agreement as set forth herein.

     

    1.  Warrant
      Agreement.
      The
      Warrant Agreement is hereby amended by adding the following sentence as the
      penultimate sentence of Section 3.3.2:

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    ‘‘Furthermore,
      if the Company is unable to deliver any securities pursuant to the exercise
      of a
      Warrant as a result of the foregoing situation, the Company will have no
      obligation to pay such registered holder any cash or other consideration or
      otherwise ‘‘net cash-settle’’ the Warrant.’’

     

    2.  Miscellaneous.

     

    (a)  Governing
      Law.
      The
      validity, interpretation, and performance of this Agreement and of the Warrants
      shall be governed in all respects by the laws of the State of New York, without
      giving effect to conflicts of law principles that would result in the
      application of the substantive laws of another jurisdiction. The Company hereby
      agrees that any action, proceeding or claim against it arising out of or
      relating in any way to this Agreement shall be brought and enforced in the
      courts of the State of New York or the United States District Court for the
      Southern District of New York, and irrevocably submits to such jurisdiction,
      which jurisdiction shall be exclusive. The Company hereby waives any objection
      to such exclusive jurisdiction and that such courts represent an inconvenient
      forum. Any such process or summons to be served upon the Company may be served
      by transmitting a copy thereof by registered or certified mail, return receipt
      requested, postage prepaid, addressed to it at the address set forth in Section
      9.2 of the Warrant Agreement. Such mailing shall be deemed personal service
      and
      shall be legal and binding upon the Company in any action, proceeding or
      claim.

     

    (b)  Binding
      Effect.
      This
      Agreement shall be binding upon and inure to the benefit of the parties hereto
      and to their respective successors and assigns.

     

    (c)  Entire
      Agreement.
      This
      Agreement sets forth the entire agreement and understanding between the parties
      as to the subject matter thereof and merges and supersedes all prior
      discussions, agreements and understandings of any and every nature among them.
      Except as set forth in this Agreement, provisions of the Warrant Agreement
      which
      are not inconsistent with this Agreement shall remain in full force and effect.
      This Agreement may be executed in counterparts.

    

    (d) Severability. 
      This Agreement shall be deemed severable, and the invalidity or unenforceability
      of any term or provision hereof shall not affect the validity or enforceability
      of this Agreement or of any other term or provision hereof. Furthermore, in
      lieu
      of any such invalid or unenforceable term or provision, the parties hereto
      intend that there shall be added as part of this Agreement a provision as
      similar in terms to such invalid or unenforceable provision as may be possible
      and be valid and enforceable.

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, the parties hereto have executed this Warrant Clarification
      Agreement as of the date first written above.

     

    
      	
              NEOSTEM,
                INC.

            
	
               
                 

            	
               
                 

            
	
              By:  

            	  
	 	
              Robin
                L. Smith, Chief Executive Officer

            
	
               

            	 
	
              CONTINENTAL
                STOCK TRANSFER &

              TRUST
                COMPANY

            
	
               
                 

            	
               
                 

            
	
              By:UNDERWRITER
      WARRANT CLARIFICATION AGREEMENT 

     

    This
      Underwriter Warrant Clarification Agreement (this “Agreement”), dated as of
      ______ ____, 2008, to the Underwriter Warrants issued as of August 14, 2007
      (the
“Underwriter Warrants”) is made and entered into by and between NeoStem, Inc., a
      Delaware corporation with offices at 420 Lexington Avenue, New York, New York
      10170 (“Company”) and the holders of Underwriter Warrant numbers UW-1, UW-2,
      UW-3, UW-4, and UW-5, being all of the holders of the Underwriter Warrants
      issued in connection with the Company’s August 2007 public offering (each, a
“Holder”), with each
      Holder acting with respect to the Underwriter Warrant issued to it.

    

    WHEREAS,
      the
      Underwriter Warrants do not contain any provisions granting registered holders
      of Underwriter Warrants the right to receive any cash or other consideration
      or
      otherwise “net cash settle” the Underwriter Warrants in the event securities
      cannot be issued upon exercise of the Underwriter Warrants because a
      registration statement is not effective.

     

    WHEREAS,
      as a
      result of certain questions that have arisen regarding the accounting treatment
      applicable to the Underwriter Warrants, the parties hereto deem it necessary
      and
      desirable to amend the Underwriter Warrants to clarify and confirm that the
      registered holders do not have the right to receive a net cash settlement in
      the
      event the Company does not maintain a current prospectus relating to the common
      stock issuable upon exercise of the Underwriter Warrants at the time such
      Underwriter Warrants are exercisable.

     

    NOW,
      THEREFORE,
      in
      consideration of the mutual agreements contained herein and other good and
      valuable consideration, the receipt and sufficiency of which are hereby
      acknowledged, and intending to be legally bound hereby, the parties hereto
      agree
      to amend the Underwriter Warrants as set forth herein (each Holder acting with
      respect to the Underwriter Warrant issued to it).

     

    1.  Underwriter
      Warrants:
      Each
      Underwriter Warrant is hereby amended by adding the following sentence as the
      penultimate sentence of Section 2.3.3:

     

    ‘‘Furthermore,
      if the Company is unable to deliver any securities pursuant to the exercise
      of
      an Underwriter Warrant as a result of the foregoing situation, the Company
      will
      have no obligation to pay such registered holder any cash or other consideration
      or otherwise ‘‘net cash-settle’’ the Underwriter Warrant.’’

     

    420
      Lexington Avenue, Suite 450, New York, NY 10170 212.584.4180 main 646.514.7787
      fax

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    2.  Miscellaneous.

     

    (a)  Governing
      Law.
      The
      validity, interpretation, and performance of this Agreement and of the
      Underwriter Warrants shall be governed in all respects by the laws of the State
      of New York, without giving effect to conflicts of law principles that would
      result in the application of the substantive laws of another jurisdiction.
      The
      Company hereby agrees that any action, proceeding or claim against it arising
      out of or relating in any way to this Agreement shall be brought and enforced
      in
      the courts of the State of New York or the United States District Court for
      the
      Southern District of New York, and irrevocably submits to such jurisdiction,
      which jurisdiction shall be exclusive. The Company hereby waives any objection
      to such exclusive jurisdiction and that such courts represent an inconvenient
      forum. Any such process or summons to be served upon the Company may be served
      by transmitting a copy thereof by registered or certified mail, return receipt
      requested, postage prepaid, addressed to it at the address set forth in Section
      7.3 of the Underwriter Warrants. Such mailing shall be deemed personal service
      and shall be legal and binding upon the Company in any action, proceeding or
      claim.

     

    (b)  Binding
      Effect.
      This
      Agreement shall be binding upon and inure to the benefit of the parties hereto
      and to their respective successors and assigns.

     

    (c)  Entire
      Agreement.
      This
      Agreement sets forth the entire agreement and understanding between the parties
      as to the subject matter thereof and merges and supersedes all prior
      discussions, agreements and understandings of any and every nature among them.
      Except as set forth in this Agreement, provisions of the Underwriter Warrants
      which are not inconsistent with this Agreement shall remain in full force and
      effect. This Agreement may be executed in counterparts.

    

    (d) Severability. 
      This Agreement shall be deemed severable, and the invalidity or unenforceability
      of any term or provision hereof shall not affect the validity or enforceability
      of this Agreement or of any other term or provision hereof. Furthermore, in
      lieu
      of any such invalid or unenforceable term or provision, the parties hereto
      intend that there shall be added as part of this Agreement a provision as
      similar in terms to such invalid or unenforceable provision as may be possible
      and be valid and enforceable.  

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, the parties hereto have executed this Underwriter Warrant
      Clarification Agreement as of the date first written above.

     

    
      	
               

            	 	
              NEOSTEM,
                INC.

            
	
               
                 

            	 	
               
                 

            	
               
                 

            
	
               

            	 	
              By:  

            	  
	
               

            	 	 	
              Robin
                L. Smith, Chief Executive Officer

            
	
               

            	 	
               

            	 
	
               Holder
                of UW-1:

            	 	 	 
	
               

            	 	
              By:  

            	  
	
               
                 

            	 	
               
                 

            	
               
                 

            
	
               Holder
                of UW-2:

            	 	
              By:  

            	  
	
               
                 

            	 	
               
                 

            	
               
                 

            
	
               Holder
                of UW-3

            	 	
              By:  

            	  
	
               

            	 	
               

            	
               

            
	
               Holder
                of UW-4:

            	 	 	 
	
               

            	 	
              By:  

            	  
	
               

            	 	
               

            	 
	
               Holder
                of UW-5:

            	 	 	 
	
               

            	 	
              By:

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