Document:

EX-10.175

Exhibit 10.175

Dated: August 4, 2005

NEITHER THIS DEBENTURE NOR THE SECURITIES INTO WHICH THIS DEBENTURE IS CONVERTIBLE HAVE
BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF
ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD
EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT
TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.

No. CCP-1 $1,000,000

THE IMMUNE RESPONSE CORPORATION

Secured Convertible Debenture

Due August 4, 2006

This Secured Convertible Debenture (the “Debenture”) is issued by THE IMMUNE RESPONSE
CORPORATION, a Delaware corporation (the “Obligor”), to CORNELL CAPITAL PARTNERS, LP (the
“Holder”), pursuant to that certain Securities Purchase Agreement (the “Securities
Purchase Agreement”) of even date herewith.

FOR VALUE RECEIVED, the Obligor hereby promises to pay to the Holder or its successors and
assigns the principal sum of One Million Dollars ($1,000,000) together with accrued but unpaid
interest on or before August 4, 2006 (the “Maturity Date”) in accordance with the following
terms:

Interest. Interest shall accrue on the outstanding principal balance hereof at an
annual rate equal to twelve percent (12%). Interest shall be calculated on the basis of a 360-day
year and the actual number of days elapsed, to the extent permitted by applicable law. Prior to
the first Scheduled Payment (as defined below), the Obligor shall make monthly payments of accrued
and unpaid interest. The first such payment shall be due and payable on the one month anniversary
of the date hereof, and each subsequent payment shall be due and payable on the same day of each
subsequent calendar month until the first Scheduled Payment is due. Interest hereunder will be
paid to the Holder or its assignee (as defined in Section 4) in whose name this Debenture is
registered on the records of the Obligor regarding registration and transfers of Debentures (the
“Debenture Register”).

Monthly Payments. The Obligor shall make monthly scheduled payments (“Scheduled
Payments”) consisting of principal and accrued interest. The first Scheduled Payment shall be
due and payable on the earlier of (a) the first day of the first month immediately following the
date that the Underlying Shares Registration Statement is declared effective by the Commission, or
(b) the date ninety (90) days from the date hereof. After the first Scheduled Payment, each
subsequent Scheduled Payment shall be due and payable on the same day of each subsequent calendar
month until the Maturity Date. The principal amount of each Scheduled Payment shall be determined
by dividing the outstanding principal amount of this Debenture as of the date of such Scheduled
Payment by the number of Scheduled Payments remaining until the Maturity Date. For example, if on
the date of the first Scheduled Payment the outstanding principal balance of this Debenture is
$1,000,000 and there are 10 Scheduled Payments remaining prior to the Maturity Date then the first
Scheduled Payment would consist of $100,000 of principal plus accrued and unpaid interest at the
interest rate specified above. All payments in respect of the indebtedness evidenced hereby shall
be made in collected funds, and shall be applied to principal, accrued interest and charges and
expenses owing under or in connection with this Debenture in such order as the Holder elects,
except that payments shall be applied to accrued interest before principal. Notwithstanding the
foregoing, this Debenture shall become due and immediately payable, including all accrued but
unpaid interest, upon an Event of Default (as defined in Section 2 hereof).

Right of Redemption. The Obligor at its option shall have the right, with three (3)
business days advance written notice, to redeem a portion or all amounts outstanding under this
Debenture prior to the Maturity Date or any Scheduled Payment due date. In the event that the
Closing Bid Price of the Common Stock on any date that the Obligor provides advance written notice
of redemption is greater than the Conversion Price then in effect, the Obligor shall pay a
redemption premium of twenty percent (20%) (“Redemption Premium”) of the amount redeemed in
addition to such redemption.

Security Agreements. This Debenture is secured by a Security Agreement (the
“Security Agreement”) of even date herewith between the Obligor and the Holder, a pledge
of_4,959,705 shares of Common Stock (“Pledged Shares”) by the Obligor in accordance with a
Pledge and Escrow Agreement (the “Pledge Agreement”) of even date herewith among the
Obligor, the Holder, and the Escrow Agent, and an Insider Pledge and Escrow Agreement (the
“Insider Pledge Agreement”) of even date herewith among the Obligor, the Holder, Cheshire
Associates LLC and the Escrow Agent.

Consent of Holder to Sell Capital Stock or Grant Security Interests. Except for the
capital stock to be issued pursuant to the Standby Equity Distribution Agreement of even date
herewith between the Obligor and Cornell Capital Partners, LP, so long as any of the principal
amount or interest on this Debenture remains unpaid and unconverted, the Obligor shall not, without
the prior consent of the Holder which shall not be unreasonably withheld, and except for grants of
stock awards and stock options under the Obligor’s current equity incentive plan (including a
future increase of up to 5,000,000 shares in the share reserve) and except for exercises or
conversions of currently outstanding derivative securities, (i) issue or sell any common stock or
preferred stock with or without consideration, (ii) issue or sell any preferred stock, warrant,
option, right, contract, call, or other security or instrument granting the holder thereof the
right to acquire common stock with or without consideration, (iii) enter into any security
instrument granting the holder a security interest in any of the assets of the Obligor, unless such
security interest is junior to that of the Holder, or (iv) other than with regard to allowed
increases in the equity incentive plan share reserve set forth above, file any registration
statements on Form S-8.

This Debenture is subject to the following additional provisions:

Section 1. This Debenture is exchangeable for an equal aggregate principal amount of
Debentures of different authorized denominations, as requested by the Holder surrendering the same.
No service charge will be made for such registration of transfer or exchange.

Section 2. Events of Default.

(a) An “Event of Default”, wherever used herein, means any one of the following events
(whatever the reason and whether it shall be voluntary or involuntary or effected by operation of
law or pursuant to any judgment, decree or order of any court, or any order, rule or regulation of
any administrative or governmental body):

(i) Any default in the payment of the principal of, interest on or other charges in respect of
this Debenture, free of any claim of subordination, as and when the same shall become due and
payable (whether on a Scheduled Payment due date, a Conversion Date or the Maturity Date or by
acceleration or otherwise);

(ii) The Obligor shall fail to observe or perform in any material respect any other covenant,
agreement or warranty contained in, or otherwise commit any breach or default of any provision of
this Debenture (except as may be covered by Section 2(a)(i) hereof) or any Transaction Document (as
defined in Section 4) which is not cured with in the time prescribed;

(iii) The Obligor or any subsidiary of the Obligor shall commence, or there shall be commenced
against the Obligor or any subsidiary of the Obligor under any applicable bankruptcy or insolvency
laws as now or hereafter in effect or any successor thereto, or the Obligor or any subsidiary of
the Obligor commences any other proceeding under any reorganization, arrangement, adjustment of
debt, relief of debtors, dissolution, insolvency or liquidation or similar law of any jurisdiction
whether now or hereafter in effect relating to the Obligor or any subsidiary of the Obligor or
there is commenced against the Obligor or any subsidiary of the Obligor any such bankruptcy,
insolvency or other proceeding which remains undismissed for a period of 61 days; or the Obligor or
any subsidiary of the Obligor is adjudicated insolvent or bankrupt; or any order of relief or other
order approving any such case or proceeding is entered; or the Obligor or any subsidiary of the
Obligor suffers any appointment of any custodian, private or court appointed receiver or the like
for it or any substantial part of its property which continues undischarged or unstayed for a
period of sixty one (61) days; or the Obligor or any subsidiary of the Obligor makes a general
assignment for the benefit of creditors; or the Obligor or any subsidiary of the Obligor shall fail
to pay, or shall state that it is unable to pay, or shall be unable to pay, its debts generally as
they become due; or the Obligor or any subsidiary of the Obligor shall call a meeting of its
creditors with a view to arranging a composition, adjustment or restructuring of its debts; or the
Obligor or any subsidiary of the Obligor shall by any act or failure to act expressly indicate its
consent to, approval of or acquiescence in any of the foregoing; or any corporate or other action
is taken by the Obligor or any subsidiary of the Obligor for the purpose of effecting any of the
foregoing;

(iv) The Obligor or any subsidiary of the Obligor shall default in any of its obligations
under any other debenture or any mortgage, credit agreement or other facility, indenture agreement,
factoring agreement or other instrument under which there may be issued, or by which there may be
secured or evidenced any indebtedness for borrowed money or money due under any long term leasing
or factoring arrangement of the Obligor or any subsidiary of the Obligor in an amount exceeding
$100,000, whether such indebtedness now exists or shall hereafter be created and such default
actually results in such indebtedness becoming or being declared due and payable prior to the date
on which it would otherwise become due and payable;

(v) The Common Stock shall cease to be quoted for trading or listed for trading on either the
Nasdaq OTC Bulletin Board (“OTC”), Nasdaq SmallCap Market, New York Stock Exchange,
American Stock Exchange or the Nasdaq National Market (each, a “Subsequent Market”) and
shall not again be quoted or listed for trading thereon within five (5) Trading Days of such
delisting;

(vi) The Obligor or any subsidiary of the Obligor shall be a party to any Change of Control
Transaction (as defined in Section 4);

(vii) The Obligor shall fail to file the Underlying Shares Registration Statement (as defined
in Section 4) with the Commission (as defined in Section 4), or the Underlying Shares Registration
Statement shall not have been declared effective by the Commission, in each case within the time
periods set forth in the Registration Rights Agreement of even date herewith between the Obligor
and the Holder;

(viii) If the effectiveness of the Underlying Shares Registration Statement lapses for any
reason or the Holder shall not be permitted to resell the shares of Common Stock underlying this
Debenture under the Underlying Shares Registration Statement, in either case (other than allowable
blackout periods), for more than five (5) consecutive Trading Days or an aggregate of eight Trading
Days (which need not be consecutive Trading Days);

(ix) The Obligor shall fail for any reason to deliver Common Stock certificates to a Holder
prior to the fifth (5th) Trading Day after a Conversion Date or the Obligor shall
provide notice to the Holder, including by way of public announcement, at any time, of its
intention not to comply with requests for conversions of this Debenture in accordance with the
terms hereof;

(x) The Obligor shall fail for any reason to deliver the payment in cash pursuant to a Buy-In
(as defined herein) within three (3) days after notice is claimed delivered hereunder;

(b) During the time that any portion of this Debenture is outstanding, if any Event of Default
has occurred, the full principal amount of this Debenture, together with interest and other amounts
owing in respect thereof, to the date of acceleration shall become at the Holder’s election,
immediately due and payable in cash, provided however, the Holder may request (but shall have no
obligation to request) payment of such amounts in Common Stock of the Obligor. If an Event of
Default occurs and remains uncured, the Conversion Price shall be reduced to $0.1579. In addition
to any other remedies, the Holder shall have the right (but not the obligation) to convert this
Debenture at any time after (x) an Event of Default or (y) the Maturity Date at the Conversion
Price then in-effect.

The Holder need not provide and the Obligor hereby waives any presentment, demand, protest or other
notice of any kind, and the Holder may immediately and without expiration of any grace period
enforce any and all of its rights and remedies hereunder and all other remedies available to it
under applicable law. Such declaration may be rescinded and annulled by Holder at any time prior to
payment hereunder. No such rescission or annulment shall affect any subsequent Event of Default or
impair any right consequent thereon.

	 	 	 	 	 
	Section 3.

	 	 	 	Conversion.
	 
	 	 	 	 
	 
	 	 
	 
	 	 	 	 
	(a)

	 	(i)
	 	Conversion at Option of Holder.
	
 
	 	 	 	 

(A) This Debenture shall be convertible into shares of Common Stock at the option of the
Holder, in whole or in part at any time and from time to time, after the Original Issue Date (as
defined in Section 4) (subject to the limitations on conversion set forth in Section 3(a)(ii)
hereof). The number of shares of Common Stock issuable upon a conversion hereunder equals the
quotient obtained by dividing (x) the outstanding principal amount of this Debenture to be
converted by (y) the Conversion Price (as defined in Section 3(c)(i)). The Obligor shall deliver
Common Stock certificates to the Holder prior to the Fifth (5th) Trading Day after a
Conversion Date.

(B) Notwithstanding anything to the contrary contained herein, if on any Conversion Date: (1)
the number of shares of Common Stock at the time authorized, unissued and unreserved for all
purposes, or held as treasury stock, is insufficient to pay principal and interest hereunder in
shares of Common Stock; (2) the Common Stock is not listed or quoted for trading on the OTC or on a
Subsequent Market; (3) the Obligor has failed to timely satisfy its conversion; then, at the option
of the Holder, the Obligor, in lieu of delivering shares of Common Stock pursuant to Section
3(a)(i)(A), shall deliver, within three (3) Trading Days of each applicable Conversion Date, an
amount in cash equal to the product of the outstanding principal amount to be converted plus any
interest due therein divided by the Conversion Price and multiplied by the highest closing price of
the stock from date of the conversion notice till the date that such cash payment is made.

Further, if the Obligor shall not have delivered any cash due in respect of conversion of this
Debenture or as payment of interest thereon by the fifth (5th) Trading Day after the
Conversion Date, the Holder may, by notice to the Obligor, require the Obligor to issue shares of
Common Stock pursuant to Section 3(c), except that for such purpose the Conversion Price applicable
thereto shall be the lesser of the Conversion Price on the Conversion Date and the Conversion Price
on the date of such Holder demand. Any such shares will be subject to the provisions of this
Section.

(C) The Holder shall effect conversions by delivering to the Obligor a completed notice in the
form attached hereto as Exhibit A (a “Conversion Notice”). The date on which a Conversion
Notice is delivered is the “Conversion Date.” Unless the Holder is converting the entire
principal amount outstanding under this Debenture, the Holder is not required to physically
surrender this Debenture to the Obligor in order to effect conversions. Conversions hereunder
shall have the effect of lowering the outstanding principal amount of this Debenture plus all
accrued and unpaid interest thereon in an amount equal to the applicable conversion. The Holder and
the Obligor shall maintain records showing the principal amount converted and the date of such
conversions. In the event of any dispute or discrepancy, the records of the Holder shall be
controlling and determinative in the absence of manifest error.

(ii) Certain Conversion Restrictions.

(A) A Holder may not convert this Debenture or receive shares of Common Stock as payment of
interest hereunder to the extent such conversion or receipt of such interest payment would result
in the Holder, together with any affiliate thereof, beneficially owning (as determined in
accordance with Section 13(d) of the Exchange Act and the rules promulgated thereunder) in excess
of 4.9% of the then issued and outstanding shares of Common Stock, including shares issuable upon
conversion of, and payment of interest on, this Debenture held by such Holder after application of
this Section. Since the Holder will not be obligated to report to the Obligor the number of shares
of Common Stock it may hold at the time of a conversion hereunder, unless the conversion at issue
would result in the issuance of shares of Common Stock in excess of 4.9% of the then outstanding
shares of Common Stock without regard to any other shares which may be beneficially owned by the
Holder or an affiliate thereof, the Holder shall have the authority and obligation to determine
whether the restriction contained in this Section will limit any particular conversion hereunder
and to the extent that the Holder determines that the limitation contained in this Section applies,
the determination of which portion of the principal amount of this Debenture is convertible shall
be the responsibility and obligation of the Holder. If the Holder has delivered a Conversion
Notice for a principal amount of this Debenture that, without regard to any other shares that the
Holder or its affiliates may beneficially own, would result in the issuance in excess of the
permitted amount hereunder, the Obligor shall notify the Holder of this fact and shall honor the
conversion for the maximum principal amount permitted to be converted on such Conversion Date in
accordance with the periods described in Section 3(a)(i)(A) and, at the option of the Holder,
either retain any principal amount tendered for conversion in excess of the permitted amount
hereunder for future conversions or return such excess principal amount to the Holder (i.e., treat
the excess amount as if it had never been tendered for conversion). The provisions of this Section
may be waived by a Holder (but only as to itself and not to any other Holder) upon not less than 65
days prior notice to the Obligor. Other Holders shall be unaffected by any such waiver.

(B) The Holder shall not be entitled to convert this debenture into any shares of Common
Stock, if after taking into account such conversion, the total number of shares issued to the
Holder, or its affiliates or assigns, under this Debenture (and any other Debenture of like tenor)
and the Pledge Agreement would exceed 4,959,705, unless and until the holders of Common Stock
approve the issuance of shares under the Transaction Documents.

(b) (i) The Holder shall have the right to pursue actual damages or declare an Event of
Default pursuant to Section 2 herein for the Obligor ‘s failure to deliver certificates
representing shares of Common Stock upon conversion within the period specified herein and such
Holder shall have the right to pursue all remedies available to it at law or in equity including,
without limitation, a decree of specific performance and/or injunctive relief, in each case without
the need to post a bond or provide other security. The exercise of any such rights shall not
prohibit the Holder from seeking to enforce damages pursuant to any other Section hereof or under
applicable law.

(ii) In addition to any other rights available to the Holder, if the Obligor fails to deliver
to the Holder such certificate or certificates pursuant to Section 3(a)(i)(A) by the fifth
(5th) Trading Day after the Conversion Date, and if after such fifth (5th)
Trading Day the Holder purchases (in an open market transaction or otherwise) Common Stock to
deliver in satisfaction of a sale by such Holder of the Underlying Shares which the Holder
anticipated receiving upon such conversion (a “Buy-In”), then the Obligor shall (A) pay in
cash to the Holder (in addition to any remedies available to or elected by the Holder) the amount
by which (x) the Holder’s total purchase price (including brokerage commissions, if any) for the
Common Stock so purchased exceeds (y) the product of (1) the aggregate number of shares of Common
Stock that such Holder anticipated receiving from the conversion at issue multiplied by (2) the
market price of the Common Stock at the time of the sale giving rise to such purchase obligation
and (B) at the option of the Holder, either reissue a Debenture in the principal amount equal to
the principal amount of the attempted conversion or deliver to the Holder the number of shares of
Common Stock that would have been issued had the Obligor timely complied with its delivery
requirements under Section 3(a)(i)(A). For example, if the Holder purchases Common Stock having a
total purchase price of $11,000 to cover a Buy-In with respect to an attempted conversion of
Debentures with respect to which the market price of the Underlying Shares on the date of
conversion was a total of $10,000 under clause (A) of the immediately preceding sentence, the
Obligor shall be required to pay the Holder $1,000. The Holder shall provide the Obligor written
notice indicating the amounts payable to the Holder in respect of the Buy-In.

(c) (i) The conversion price (the “Conversion Price”) in effect on any Conversion Date
shall be equal to $0.6315, which may be adjusted pursuant to the other terms of this Debenture.

(ii) If the Obligor, at any time while this Debenture is outstanding, shall (a) pay a stock
dividend or otherwise make a distribution or distributions on shares of its Common Stock or any
other equity or equity equivalent securities payable in shares of Common Stock, (b) subdivide
outstanding shares of Common Stock into a larger number of shares, (c) combine (including by way of
reverse stock split) outstanding shares of Common Stock into a smaller number of shares, or (d)
issue by reclassification of shares of the Common Stock any shares of capital stock of the Obligor,
then the Conversion Price shall be multiplied by a fraction of which the numerator shall be the
number of shares of Common Stock (excluding treasury shares, if any) outstanding before such event
and of which the denominator shall be the number of shares of Common Stock outstanding after such
event. Any adjustment made pursuant to this Section shall become effective immediately after the
record date for the determination of stockholders entitled to receive such dividend or distribution
and shall become effective immediately after the effective date in the case of a subdivision,
combination or re-classification.

(iii) If the Obligor, at any time while this Debenture is outstanding, shall issue rights,
options or warrants to all holders of Common Stock (and not to the Holder) entitling them to
subscribe for or purchase shares of Common Stock at a price per share less than the Closing Bid
Price at the record date mentioned below, then the Conversion Price shall be multiplied by a
fraction, of which the denominator shall be the number of shares of the Common Stock (excluding
treasury shares, if any) outstanding on the date of issuance of such rights or warrants (plus the
number of additional shares of Common Stock offered for subscription or purchase), and of which the
numerator shall be the number of shares of the Common Stock (excluding treasury shares, if any)
outstanding on the date of issuance of such rights or warrants, plus the number of shares which the
aggregate offering price of the total number of shares so offered would purchase at such Closing
Bid Price. Such adjustment shall be made whenever such rights or warrants are issued, and shall
become effective immediately after the record date for the determination of stockholders entitled
to receive such rights, options or warrants. However, upon the expiration of any such right, option
or warrant to purchase shares of the Common Stock the issuance of which resulted in an adjustment
in the Conversion Price pursuant to this Section, if any such right, option or warrant shall expire
and shall not have been exercised, the Conversion Price shall immediately upon such expiration be
recomputed and effective immediately upon such expiration be increased to the price which it would
have been (but reflecting any other adjustments in the Conversion Price made pursuant to the
provisions of this Section after the issuance of such rights or warrants) had the adjustment of the
Conversion Price made upon the issuance of such rights, options or warrants been made on the basis
of offering for subscription or purchase only that number of shares of the Common Stock actually
purchased upon the exercise of such rights, options or warrants actually exercised.

(iv) If the Obligor or any subsidiary thereof, as applicable, with respect to Common Stock
Equivalents (as defined below), at any time while this Debenture is outstanding, shall issue shares
of Common Stock or rights, warrants, options or other securities or debt that are convertible into
or exchangeable for shares of Common Stock (“Common Stock Equivalents”) entitling any
Person to acquire shares of Common Stock, at a price per share less than the Conversion Price (if
the holder of the Common Stock or Common Stock Equivalent so issued shall at any time, whether by
operation of purchase price adjustments, reset provisions, floating conversion, exercise or
exchange prices or otherwise, or due to warrants, options or rights per share which is issued in
connection with such issuance, be entitled to receive shares of Common Stock at a price per share
which is less than the Conversion Price, such issuance shall be deemed to have occurred for less
than the Conversion Price), then, at the sole option of the Holder, the Conversion Price shall be
adjusted to mirror the conversion, exchange or purchase price for such Common Stock or Common Stock
Equivalents (including any reset provisions thereof) at issue. Such adjustment shall be made
whenever such Common Stock or Common Stock Equivalents are issued. The Obligor shall notify the
Holder in writing, no later than one (1) business day following the issuance of any Common Stock or
Common Stock Equivalent subject to this Section, indicating therein the applicable issuance price,
or of applicable reset price, exchange price, conversion price and other pricing terms. No
adjustment under this Section shall be made as a result of (1) issuances and exercises of options
to purchase shares of Common Stock issued for compensatory purposes pursuant to any of the
Obligor’s stock option or stock purchase plans, (2) issuances of up to 1,000,000 shares of Common
Stock or Common Stock Equivalents issued to financial institutions or lessors in connection with
commercial credit arrangements, equipment financings, commercial property lease transactions or
similar transactions, (3) Common Stock Equivalents of the Obligor issued prior to, and outstanding
on, the Original Issuance Date and Common Stock issuable on exercise or conversion of such Common
Stock Equivalents, provided such Common Stock Equivalents are not amended after the Original Issue
Date, (4) any issuance by the Obligor of securities to an entity which is not an “Affiliate” of the
Obligor (as defined in Rule 144 of the Securities Act) as a component of any business relationship
with such entity for the purpose of (x) joint venture, technology licensing, or development
activities, (y) distribution, supply or manufacture of the Company’s products or services, or (z)
any other arrangement involving corporate partners that are primarily for purposes other than to
raise equity capital, or (5) any issuance by the Obligor of securities as consideration for a
merger or consolidation or the acquisition of a business, product, license, or other assets of
another person or entity which is not an “Affiliate” of the Obligor.

(v) If the Obligor, at any time while this Debenture is outstanding, shall distribute to all
holders of Common Stock (and not to the Holder) evidences of its indebtedness or assets or rights
or warrants to subscribe for or purchase any security, then in each such case the Conversion Price
at which this Debenture shall thereafter be convertible shall be determined by multiplying the
Conversion Price in effect immediately prior to the record date fixed for determination of
stockholders entitled to receive such distribution by a fraction of which the denominator shall be
the Closing Bid Price determined as of the record date mentioned above, and of which the numerator
shall be such Closing Bid Price on such record date less the then fair market value at such record
date of the portion of such assets or evidence of indebtedness so distributed applicable to one
outstanding share of the Common Stock as determined by the Board of Directors in good faith. In
either case the adjustments shall be described in a statement provided to the Holder of the portion
of assets or evidences of indebtedness so distributed or such subscription rights applicable to one
share of Common Stock. Such adjustment shall be made whenever any such distribution is made and
shall become effective immediately after the record date mentioned above.

(vi) In case of any reclassification of the Common Stock (but not including a stock split or
reverse stock split) or any compulsory share exchange pursuant to which the Common Stock is
converted into other securities, cash or property, the Holder shall have the right thereafter to,
at its option, (A) convert the then outstanding principal amount, together with all accrued but
unpaid interest and any other amounts then owing hereunder in respect of this Debenture into the
shares of stock and other securities, cash and property receivable upon or deemed to be held by
holders of the Common Stock following such reclassification or share exchange, and the Holder of
this Debenture shall be entitled upon such event to receive such amount of securities, cash or
property as the shares of the Common Stock of the Obligor into which the then outstanding principal
amount, together with all accrued but unpaid interest and any other amounts then owing hereunder in
respect of this Debenture could have been converted immediately prior to such reclassification or
share exchange would have been entitled, or (B) require the Obligor to prepay the outstanding
principal amount of this Debenture, plus all interest and other amounts due and payable thereon.
The entire prepayment price shall be paid in cash. This provision shall similarly apply to
successive reclassifications or share exchanges.

(vii) The Obligor shall maintain a share reserve of not less than 100% of the shares of Common
Stock issuable upon conversion of this Debenture; and within three (3) Business Days following the
receipt by the Obligor of a Holder’s notice that such minimum number of Underlying Shares is not so
reserved, the Obligor shall promptly reserve a sufficient number of shares of Common Stock to
comply with such requirement.

(viii) All calculations under this Section 3 shall be rounded up to the nearest $0.001 of a
share.

(ix) Whenever the Conversion Price is adjusted pursuant to Section 3 hereof, the Obligor shall
promptly mail to the Holder a notice setting forth the Conversion Price after such adjustment and
setting forth a brief statement of the facts requiring such adjustment. Notwithstanding the above
provisions of this Section 3, the number of shares of Common Stock issuable upon conversion of this
Debenture shall in no event be adjusted to an amount such that the Total Transaction Shares (as
defined below) shall be equal to or greater than 9,699,143 shares of Common Stock (which is no more
than 19.99% of at least 48,739,415 outstanding shares of Common Stock as of the execution of the
Standby Equity Distribution Agreement between the Company and the Holder dated July 15, 2005
(“SEDA”)), until the holders of Common Stock approve the issuance of the Total Transaction
Shares. “Total Transaction Shares” shall mean, in the aggregate, the shares of Common
Stock issued to the Holder or its affiliates, and transferees, subsequent transferees, or any other
party pursuant to the Securities Purchase Agreement of even date herewith among the Company and
Holder (“Securities Purchase Agreement”), the Pledge and Escrow Agreement of even date
herewith among the Company, the Holder, and David Gonzalez, Esq. (the “Pledge Agreement”), the
Placement Agent Agreement dated as of July 15, 2005 among the Company, the Holder and Monitor
Capital, Inc., and the SEDA, the Warrants issued to the Holder pursuant to the Securities Purchase
Agreement, together with the Conversion Shares.

(x) If (A) the Obligor shall declare a dividend (or any other distribution) on the Common
Stock; (B) the Obligor shall declare a special nonrecurring cash dividend on or a redemption of the
Common Stock; (C) the Obligor shall authorize the granting to all holders of the Common Stock
rights or warrants to subscribe for or purchase any shares of capital stock of any class or of any
rights; (D) the approval of any stockholders of the Obligor shall be required in connection with
any reclassification of the Common Stock, any consolidation or merger to which the Obligor is a
party, any sale or transfer of all or substantially all of the assets of the Obligor, of any
compulsory share exchange whereby the Common Stock is converted into other securities, cash or
property; or (E) the Obligor shall authorize the voluntary or involuntary dissolution, liquidation
or winding up of the affairs of the Obligor; then, in each case, the Obligor shall cause to be
filed at each office or agency maintained for the purpose of conversion of this Debenture, and
shall cause to be mailed to the Holder at its last address as it shall appear upon the stock books
of the Obligor, at least twenty (20) calendar days prior to the applicable record or effective date
hereinafter specified, a notice stating (x) the date on which a record is to be taken for the
purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to be
taken, the date as of which the holders of the Common Stock of record to be entitled to such
dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on
which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to
become effective or close, and the date as of which it is expected that holders of the Common Stock
of record shall be entitled to exchange their shares of the Common Stock for securities, cash or
other property deliverable upon such reclassification, consolidation, merger, sale, transfer or
share exchange, provided, that the failure to mail such notice or any defect therein or in the
mailing thereof shall not affect the validity of the corporate action required to be specified in
such notice. The Holder is entitled to convert this Debenture during the 20-day calendar period
commencing the date of such notice to the effective date of the event triggering such notice.

(xi) In case of any (1) merger or consolidation of the Obligor or any subsidiary of the
Obligor with or into another Person, or (2) sale by the Obligor or any subsidiary of the Obligor of
more than one-half of the assets of the Obligor in one or a series of related transactions, a
Holder shall have the right to (A) exercise any rights under Section 2(b), (B) convert the
aggregate amount of this Debenture then outstanding into the shares of stock and other securities,
cash and property receivable upon or deemed to be held by holders of Common Stock following such
merger, consolidation or sale, and such Holder shall be entitled upon such event or series of
related events to receive such amount of securities, cash and property as the shares of Common
Stock into which such aggregate principal amount of this Debenture could have been converted
immediately prior to such merger, consolidation or sales would have been entitled, or (C) in the
case of a merger or consolidation, require the surviving entity to issue to the Holder a
convertible Debenture with a principal amount equal to the aggregate principal amount of this
Debenture then held by such Holder, plus all accrued and unpaid interest and other amounts owing
thereon, which such newly issued convertible Debenture shall have terms identical (including with
respect to conversion) to the terms of this Debenture, and shall be entitled to all of the rights
and privileges of the Holder of this Debenture set forth herein and the agreements pursuant to
which this Debentures were issued. In the case of clause (C), the conversion price applicable for
the newly issued convertible Debentures shall be based upon the amount of securities, cash and
property that each share of Common Stock would receive in such transaction and the Conversion Price
in effect immediately prior to the effectiveness or closing date for such transaction. The terms of
any such merger, sale or consolidation shall include such terms so as to continue to give the
Holder the right to receive the securities, cash and property set forth in this Section upon any
conversion or redemption following such event. This provision shall similarly apply to successive
such events.

(d) The Obligor covenants that it will at all times reserve and keep available out of its
authorized and unissued shares of Common Stock solely for the purpose of issuance upon conversion
of this Debenture and payment of interest on this Debenture, each as herein provided, free from
preemptive rights or any other actual contingent purchase rights of persons other than the Holder,
not less than such number of shares of the Common Stock as shall (subject to any additional
requirements of the Obligor as to reservation of such shares set forth in this Debenture) be
issuable (taking into account the adjustments and restrictions of Sections 2(b) and 3(c)) upon the
conversion of the outstanding principal amount of this Debenture and payment of interest hereunder.
The Obligor covenants that all shares of Common Stock that shall be so issuable shall, upon issue,
be duly and validly authorized, issued and fully paid, nonassessable and, if the Underlying Shares
Registration Statement has been declared effective under the Securities Act, registered for public
resale in accordance with such Underlying Shares Registration Statement.

(e) Upon a conversion hereunder the Obligor shall not be required to issue stock certificates
representing fractions of shares of the Common Stock, but may if otherwise permitted, make a cash
payment in respect of any final fraction of a share based on the Closing Bid Price at such time. If
the Obligor elects not, or is unable, to make such a cash payment, the Holder shall be entitled to
receive, in lieu of the final fraction of a share, one whole share of Common Stock.

(f) The issuance of certificates for shares of the Common Stock on conversion of this
Debenture shall be made without charge to the Holder thereof for any documentary stamp or similar
taxes that may be payable in respect of the issue or delivery of such certificate, provided that
the Obligor shall not be required to pay any tax that may be payable in respect of any transfer
involved in the issuance and delivery of any such certificate upon conversion in a name other than
that of the Holder of such Debenture so converted and the Obligor shall not be required to issue or
deliver such certificates unless or until the person or persons requesting the issuance thereof
shall have paid to the Obligor the amount of such tax or shall have established to the satisfaction
of the Obligor that such tax has been paid.

(g) Any notices, consents, waivers or other communications required or permitted to be given
under the terms hereof must be in writing and will be deemed to have been delivered: (i) upon
receipt, when delivered personally; (ii) upon receipt, when sent by facsimile (provided
confirmation of transmission is mechanically or electronically generated and kept on file by the
sending party); or (iii) one (1) trading day after deposit with a nationally recognized overnight
delivery service, in each case properly addressed to the party to receive the same. The addresses
and facsimile numbers for such communications shall be:

	 	 	 	 	 
	If to the Company, to:
	 	The Immune Response Corporation

	 
	 	5391 Darwin Court
	 
	 	Carlsbad, CA 92008

	 
	 	Attention: Michael K. Green

	 
	 	Facsimile: (760) 431-8636

	With a copy to:
	 	Heller Ehrman LLP

	 
	 	4530 La Jolla Village Drive, 7th Floor
	 
	 	San Diego, CA 92122

	 
	 	Attention: Hayden J. Trubitt, Esq.

	 
	 	Facsimile: (858) 587-5903

	If to the Holder:
	 	Cornell Capital Partners, LP

	 
	 	101 Hudson Street, Suite 3700
	 
	 	Jersey City, NJ  07303

	 
	 	Attention: Mark Angelo

	 
	 	Telephone: (201) 985-8300

	With a copy to:
	 	David Gonzalez, Esq.

	 
	 	101 Hudson Street – Suite 3700
	 
	 	Jersey City, NJ 07302

	 
	 	Telephone: (201) 985-8300

	 
	 	Facsimile: (201) 985-8266

or at such other address and/or facsimile number and/or to the attention of such other person as
the recipient party has specified by written notice given to each other party three (3) business
days prior to the effectiveness of such change. Written confirmation of receipt (i) given by the
recipient of such notice, consent, waiver or other communication, (ii) mechanically or
electronically generated by the sender’s facsimile machine containing the time, date, recipient
facsimile number and an image of the first page of such transmission or (iii) provided by a
nationally recognized overnight delivery service, shall be rebuttable evidence of personal service,
receipt by facsimile or receipt from a nationally recognized overnight delivery service in
accordance with clause (i), (ii) or (iii) above, respectively.

Section 4. Definitions. For the purposes hereof, the following terms shall
have the following meanings:

“Business Day” means any day except Saturday, Sunday and any day which shall be a
federal legal holiday in the United States or a day on which banking institutions are authorized or
required by law or other government action to close.

“Change of Control Transaction” means the occurrence of (a) an acquisition after the
date hereof by an individual or legal entity or “group” (as described in Rule 13d-5(b)(1)
promulgated under the Exchange Act) of effective control (whether through legal or beneficial
ownership of capital stock of the Obligor, by contract or otherwise) of in excess of fifty percent
(50%) of the voting securities of the Obligor (except that the acquisition of voting securities by
the Holder shall not constitute a Change of Control Transaction for purposes hereof), (b) a
replacement at one time or over time of more than one-half of the members of the board of directors
of the Obligor which is not approved by a majority of those individuals who are members of the
board of directors on the date hereof (or by those individuals who are serving as members of the
board of directors on any date whose nomination to the board of directors was approved by a
majority of the members of the board of directors who are members on the date hereof), (c) the
merger, consolidation or sale of fifty percent (50%) or more of the assets of the Obligor or any
subsidiary of the Obligor in one or a series of related transactions with or into another entity,
or (d) the execution by the Obligor of an agreement to which the Obligor is a party or by which it
is bound, providing for any of the events set forth above in (a), (b) or (c).

“Commission” means the Securities and Exchange Commission.

“Common Stock” means the common stock, par value $0.0025, of the Obligor and stock of
any other class into which such shares may hereafter be changed or reclassified.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

“Original Issue Date” shall mean the date of the first issuance of this Debenture
regardless of the number of transfers and regardless of the number of instruments, which may be
issued to evidence such Debenture.

“Closing Bid Price” means the price per share in the last reported trade of the Common
Stock on the Nasdaq SmallCap Market or on the exchange which the Common Stock is then listed as
quoted by Bloomberg, LP.

“Person” means a corporation, an association, a partnership, organization, a business,
an individual, a government or political subdivision thereof or a governmental agency.

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

“Trading Day” means a day on which the shares of Common Stock are quoted on the OTC or
quoted or traded on such Subsequent Market on which the shares of Common Stock are then quoted or
listed; provided, that in the event that the shares of Common Stock are not listed or quoted, then
Trading Day shall mean a Business Day.

“Transaction Documents” means the Securities Purchase Agreement or any other agreement
delivered in connection with the Securities Purchase Agreement, including, without limitation, the
Security Agreement, the Pledge Agreement, the Insider Pledge Agreement, and the Investor
Registration Rights Agreement.

“Underlying Shares” means the shares of Common Stock issuable upon conversion of this
Debenture or as payment of interest in accordance with the terms hereof.

“Underlying Shares Registration Statement” means a registration statement meeting the
requirements set forth in the Registration Rights Agreement, covering among other things the resale
of the Underlying Shares and naming the Holder as a “selling stockholder” thereunder.

Section 5. Except as expressly provided herein, no provision of this Debenture shall
alter or impair the obligations of the Obligor, which are absolute and unconditional, to pay the
principal of, interest and other charges (if any) on, this Debenture at the time, place, and rate,
and in the coin or currency, herein prescribed. This Debenture is a direct obligation of the
Obligor. This Debenture ranks pari passu with all other Debentures now or hereafter issued under
the terms set forth herein. As long as this Debenture is outstanding, the Obligor shall not and
shall cause their subsidiaries not to, without the consent of the Holder, (i) amend its certificate
of incorporation, bylaws or other charter documents so as to adversely affect any rights of the
Holder; (ii) repay, repurchase or offer to repay, repurchase or otherwise acquire shares of its
Common Stock or other equity securities other than as to the Underlying Shares to the extent
permitted or required under the Transaction Documents; or (iii) enter into any agreement with
respect to any of the foregoing.

Section 6. This Debenture shall not entitle the Holder to any of the rights of a
stockholder of the Obligor, including without limitation, the right to vote, to receive dividends
and other distributions, or to receive any notice of, or to attend, meetings of stockholders or any
other proceedings of the Obligor, unless and to the extent converted into shares of Common Stock in
accordance with the terms hereof.

Section 7. If this Debenture is mutilated, lost, stolen or destroyed, the Obligor
shall execute and deliver, in exchange and substitution for and upon cancellation of the mutilated
Debenture, or in lieu of or in substitution for a lost, stolen or destroyed Debenture, a new
Debenture for the principal amount of this Debenture so mutilated, lost, stolen or destroyed but
only upon receipt of evidence of such loss, theft or destruction of such Debenture, and of the
ownership hereof, and indemnity, if requested, all reasonably satisfactory to the Obligor.

Section 8. No indebtedness of the Obligor is senior to this Debenture in right of
payment, whether with respect to interest, damages or upon liquidation or dissolution or otherwise.
Without the Holder’s consent, the Obligor will not and will not permit any of their subsidiaries
to, directly or indirectly, enter into, create, incur, assume or suffer to exist any indebtedness
of any kind, on or with respect to any of its property or assets now owned or hereafter acquired or
any interest therein or any income or profits there from that is senior in any respect to the
obligations of the Obligor under this Debenture.

Section 9. This Debenture shall be governed by and construed in accordance with the
laws of the State of New Jersey, without giving effect to conflicts of laws thereof. Each of the
parties consents to the jurisdiction of the Superior Courts of the State of New Jersey sitting in
Hudson County, New Jersey and the U.S. District Court for the District of New Jersey sitting in
Newark, New Jersey in connection with any dispute arising under this Debenture and hereby waives,
to the maximum extent permitted by law, any objection, including any objection based on
forum non conveniens to the bringing of any such proceeding in such
jurisdictions.

Section 10. If the Obligor fails to strictly comply with the terms of this Debenture,
then the Obligor shall reimburse the Holder promptly for all fees, costs and expenses, including,
without limitation, attorneys’ fees and expenses incurred by the Holder in any action in connection
with this Debenture, including, without limitation, those incurred: (i) during any workout,
attempted workout, and/or in connection with the rendering of legal advice as to the Holder’s
rights, remedies and obligations, (ii) collecting any sums which become due to the Holder, (iii)
defending or prosecuting any proceeding or any counterclaim to any proceeding or appeal; or (iv)
the protection, preservation or enforcement of any rights or remedies of the Holder.

Section 11. Any waiver by the Holder of a breach of any provision of this Debenture
shall not operate as or be construed to be a waiver of any other breach of such provision or of any
breach of any other provision of this Debenture. The failure of the Holder to insist upon strict
adherence to any term of this Debenture on one or more occasions shall not be considered a waiver
or deprive that party of the right thereafter to insist upon strict adherence to that term or any
other term of this Debenture. Any waiver must be in writing.

Section 12. If any provision of this Debenture is invalid, illegal or unenforceable,
the balance of this Debenture shall remain in effect, and if any provision is inapplicable to any
person or circumstance, it shall nevertheless remain applicable to all other persons and
circumstances. If it shall be found that any interest or other amount deemed interest due hereunder
shall violate applicable laws governing usury, the applicable rate of interest due hereunder shall
automatically be lowered to equal the maximum permitted rate of interest. The Obligor covenants (to
the extent that it may lawfully do so) that it shall not at any time insist upon, plead, or in any
manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law or
other law which would prohibit or forgive the Obligor from paying all or any portion of the
principal of or interest on this Debenture as contemplated herein, wherever enacted, now or at any
time hereafter in force, or which may affect the covenants or the performance of this indenture,
and the Obligor (to the extent it may lawfully do so) hereby expressly waives all benefits or
advantage of any such law, and covenants that it will not, by resort to any such law, hinder, delay
or impeded the execution of any power herein granted to the Holder, but will suffer and permit the
execution of every such as though no such law has been enacted.

Section 13. Whenever any payment or other obligation hereunder shall be due on a day
other than a Business Day, such payment shall be made on the next succeeding Business Day.

Section 14. THE PARTIES HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE
RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON OR ARISING
OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY TRANSACTION DOCUMENT OR ANY COURSE OF
CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY. THIS
PROVISION IS A MATERIAL INDUCEMENT FOR THE PARTIES’ ACCEPTANCE OF THIS AGREEMENT.

[REMAINDER OF PAGE INTENTIONLLY LEFT BLANK]

1

IN WITNESS WHEREOF, the Obligor has caused this Secured Convertible Debenture to be duly
executed by a duly authorized officer as of the date set forth above.

	 	 	 	 	 
	THE IMMUNE RESPONSE CORPORATION

	 
	By:

	 

	Name:

	Title:

2

EXHIBIT “A”

NOTICE OF CONVERSION

(To be executed by the Holder in order to convert the Debenture)

	 
	 

	TO:

The undersigned hereby irrevocably elects to convert $ of the principal amount of the
above Debenture into Shares of Common Stock of The Immune Response Corporation, according to the
conditions stated therein, as of the Conversion Date written below.

	 
	 

	Conversion Date:

	 

	Applicable Conversion Price:

	 

	Signature:

	 

	Name:

	 

	Address:

	 

	Amount to be converted:

	 

	Amount of Debenture unconverted:

	 

	Conversion Price per share:

	 

	Number of shares of Common Stock to be issued:

	 

	Please issue the shares of Common Stock in the following name and to the

following address:

	 

	Issue to:

	 

	Authorized Signature:

	 

	Name:

	 

	Title:

	 

	Phone Number:

	 

	Broker DTC Participant Code:

	 

	Account Number:

	 

3EX-10.176

 Exhibit 10.176

WARRANT

THE SECURITIES REPRESENTED BY THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES HAVE BEEN ACQUIRED FOR
INVESTMENT AND MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
OR APPLICABLE STATE SECURITIES LAWS, OR AN OPINION OF COUNSEL IN A FORM REASONABLY SATISFACTORY TO
THE ISSUER THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR APPLICABLE STATE SECURITIES LAWS OR
UNLESS SOLD PURSUANT TO RULE 144 UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THIS WARRANT MAY
BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT.

THE IMMUNE RESPONSE CORPORATION

Warrant To Purchase Common Stock

Warrant No.: CCP-001 Number of Shares: 500,000

Date of Issuance: August 4, 2005

The Immune Response Corporation, a Delaware corporation (the “Company”), hereby certifies
that, for good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Cornell Capital Partners, LP (“Cornell”), the registered holder hereof or its
permitted assigns, is entitled, subject to the terms set forth below, to purchase from the Company
upon surrender of this Warrant, at any time or times on or after the date hereof, but not after
11:59 P.M. Eastern Time on the Expiration Date (as defined herein) Five Hundred Thousand (500,000)
fully paid and nonassessable shares of Common Stock (as defined herein) of the Company (the
“Warrant Shares”) at the exercise price per share provided in Section 1(b) below or as
subsequently adjusted; provided, however, that in no event shall the holder be entitled to exercise
this Warrant for a number of Warrant Shares in excess of that number of Warrant Shares which, upon
giving effect to such exercise, would cause the aggregate number of shares of Common Stock
beneficially owned by the holder and its affiliates to exceed 4.99% of the outstanding shares of
the Common Stock following such exercise, except within sixty (60) days of the Expiration Date.
For purposes of the foregoing proviso, the aggregate number of shares of Common Stock beneficially
owned by the holder and its affiliates shall include the number of shares of Common Stock issuable
upon exercise of this Warrant with respect to which the determination of such proviso is being
made, but shall exclude shares of Common Stock which would be issuable upon (i) exercise of the
remaining, unexercised Warrants beneficially owned by the holder and its affiliates and (ii)
exercise or conversion of the unexercised or unconverted portion of any other securities of the
Company beneficially owned by the holder and its affiliates (including, without limitation, any
convertible notes or preferred stock) subject to a limitation on conversion or exercise analogous
to the limitation contained herein. Except as set forth in the preceding sentence, for purposes of
this paragraph, beneficial ownership shall be calculated in accordance with Section 13(d) of the
Securities Exchange Act of 1934, as amended. For purposes of this Warrant, in determining the
number of outstanding shares of Common Stock a holder may rely on the number of outstanding shares
of Common Stock as reflected in (1) the Company’s most recent Form 10-Q or Form 10-K, as the case
may be, (2) a more recent public announcement by the Company or (3) any other notice by the Company
or its transfer agent setting forth the number of shares of Common Stock outstanding. Upon the
written request of any holder, the Company shall promptly, but in no event later than one (1)
Business Day following the receipt of such notice, confirm in writing to any such holder the number
of shares of Common Stock then outstanding. In any case, the number of outstanding shares of
Common Stock shall be determined after giving effect to the exercise of Warrants (as defined below)
by such holder and its affiliates since the date as of which such number of outstanding shares of
Common Stock was reported.

Section 1.

(a) This Warrant is the common stock purchase warrant (the “Warrant”) issued pursuant
to the Securities Purchase Agreement dated the date hereof by and between the Company and Cornell
(“Securities Purchase Agreement”).

(b) Definitions. The following words and terms as used in this Warrant shall have the
following meanings:

(i) “Approved Stock Plan” means any employee benefit plan which has been approved by
the Board of Directors of the Company, pursuant to which the Company’s securities may be issued to
any employee, officer or director for services provided to the Company.

(ii) “Business Day” means any day other than Saturday, Sunday or other day on which
commercial banks in the City of New York are authorized or required by law to remain closed.

(iii) “Closing Bid Price” means the closing bid price of Common Stock as quoted on the
Principal Market (as reported by Bloomberg Financial Markets (“Bloomberg”) through its
“Volume at Price” function).

(iv) “Common Stock” means (i) the Company’s common stock, par value $0.0025 per share,
and (ii) any capital stock into which such Common Stock shall have been changed or any capital
stock resulting from a reclassification of such Common Stock.

(v) “Event of Default” means an event of default under the Securities Purchase
Agreement.

(vi) “Excluded Securities” means any of the following: (a) any issuance by the Company
of securities to an entity as a component of any business relationship with such entity for the
purpose of (x) joint venture, technology licensing, or development activities, (y) distribution,
supply or manufacture of the Company’s products or services, or (z) any other arrangement involving
corporate partners that are primarily for purposes other than to raise equity capital, (b) any
issuance by the Company of securities as consideration for a merger or consolidation or the
acquisition of a business, product, license, or other assets of another person or entity, (c) up to
1,000,000 shares of Common Stock or Options or convertible securities issued to financial
institutions or lessors in connection with commercial credit arrangements, equipment financings,
commercial property lease transactions or similar transactions, (d) options to purchase shares of
Common Stock, provided (y) such options are issued after the date of this Warrant to employees of
the Company within thirty (30) days of such employee’s starting his employment with the Company,
and (z) the exercise price of such options is not less than the Closing Bid Price of the Common
Stock on the date of issuance of such option, (e) the issuance of up to 250,000 shares of Common
Stock or underlying Options or convertible securities not falling into any of the above exclusions,
which issuance would otherwise have required an adjustment under section 8(a) hereof, (f) any
actual or deemed issuance whatsoever at a time when no convertible debenture is outstanding under
the Securities Purchase Agreement, and (g) the issuance of up to 120,000 shares of Common Stock or
underlying warrants to Cheshire Associates LLC in exchange for its pledge of stock as described in
the Securities Purchase Agreement.

(vii) “Expiration Date” means the date five (5) years from the Issuance Date of this
Warrant or, if such date falls on a Saturday, Sunday or other day on which banks are required or
authorized to be closed in the City of New York or the State of New York or on which trading does
not take place on the Principal Exchange or automated quotation system on which the Common Stock is
traded (a “Holiday”), the next date that is not a Holiday.

(viii) “Issuance Date” means the date hereof.

(ix) “Options” means any rights, warrants or options to subscribe for or purchase
Common Stock or Convertible Securities.

(x) “Other Securities” means (i) those options, warrants, and convertible securities
of the Company issued prior to, and outstanding on, the Issuance Date of this Warrant, (ii) the
shares of Common Stock issuable on exercise of such options and warrants or on conversion of such
convertible securities, provided such options and warrants and convertible securities are not
amended after the Issuance Date of this Warrant and (iii) the shares of Common Stock issuable upon
exercise of this Warrant.

(xi) “Person” means an individual, a limited liability company, a partnership, a joint
venture, a corporation, a trust, an unincorporated organization and a government or any department
or agency thereof.

(xii) “Principal Market” means the New York Stock Exchange, the American Stock
Exchange, the Nasdaq National Market, the Nasdaq SmallCap Market, whichever is at the time the
principal trading exchange or market for such security, or the over-the-counter market on the
electronic bulletin board for such security as reported by Bloomberg or, if no bid or sale
information is reported for such security by Bloomberg, then the average of the bid prices of each
of the market makers for such security as reported in the “pink sheets” by the Pink Sheets LLC.

(xiii) “Securities Act” means the Securities Act of 1933, as amended.

(xiv) “Warrant” means this Warrant and all Warrants issued in exchange, transfer or
replacement thereof.

(xv) “Warrant Exercise Price” shall be $0.924 or as subsequently adjusted as provided
in Section 8 hereof.

(xvi) “Warrant Shares” means the shares of Common Stock issuable at any time upon
exercise of this Warrant.

(c) Other Definitional Provisions.

(i) Except as otherwise specified herein, all references herein (A) to the Company shall be
deemed to include the Company’s successors and (B) to any applicable law defined or referred to
herein shall be deemed references to such applicable law as the same may have been or may be
amended or supplemented from time to time.

(ii) When used in this Warrant, the words “herein”, “hereof”, and
“hereunder” and words of similar import, shall refer to this Warrant as a whole and not to
any provision of this Warrant, and the words “Section”, “Schedule”, and
“Exhibit” shall refer to Sections of, and Schedules and Exhibits to, this Warrant unless
otherwise specified.

(iii) Whenever the context so requires, the neuter gender includes the masculine or feminine,
and the singular number includes the plural, and vice versa.

Section 2. Exercise of Warrant.

(a) Subject to the terms and conditions hereof, this Warrant may be exercised by the holder
hereof then registered on the books of the Company, pro rata as hereinafter provided, at any time
on any Business Day on or after the opening of business on such Business Day, commencing with the
first day after the date hereof, and prior to 11:59 P.M. Eastern Time on the Expiration Date (i) by
delivery of a written notice, in the form of the subscription notice attached as Exhibit A
hereto (the “Exercise Notice”), of such holder’s election to exercise this Warrant, which
notice shall specify the number of Warrant Shares to be purchased, payment to the Company of an
amount equal to the Warrant Exercise Price(s) applicable to the Warrant Shares being purchased,
multiplied by the number of Warrant Shares (at the applicable Warrant Exercise Price) as to which
this Warrant is being exercised (plus any applicable issue or transfer taxes) (the “Aggregate
Exercise Price”) in cash or wire transfer of immediately available funds and the surrender of
this Warrant (or an indemnification undertaking with respect to this Warrant in the case of its
loss, theft or destruction) to a common carrier for overnight delivery to the Company as soon as
practicable following such date (“Cash Basis”) or (ii) if at the time of exercise, the
Warrant Shares are not subject to an effective resale registration statement or if an Event of
Default has occurred, by delivering an Exercise Notice and in lieu of making payment of the
Aggregate Exercise Price in cash or wire transfer, elect instead to receive upon such exercise the
“Net Number” of shares of Common Stock determined according to the following formula (the
“Cashless Exercise”):

Net Number = (A x B) – (A x C)

B

For purposes of the foregoing formula:

A = the total number of Warrant Shares with respect to which this Warrant is then
being exercised.

B = the Closing Bid Price of the Common Stock on the date of exercise of the
Warrant.

C = the Warrant Exercise Price then in effect for the applicable Warrant Shares at
the time of such exercise.

In the event of any exercise of the rights represented by this Warrant in compliance with this
Section 2, the Company shall on or before the fifth (5th) Business Day following the date of
receipt of the Exercise Notice, the Aggregate Exercise Price and this Warrant (or an
indemnification undertaking with respect to this Warrant in the case of its loss, theft or
destruction) and the receipt of the representations of the holder specified in Section 6 hereof, if
requested by the Company (the “Exercise Delivery Documents”), and if the Common Stock is
DTC eligible, credit such aggregate number of shares of Common Stock to which the holder shall be
entitled to the holder’s or its designee’s balance account with The Depository Trust Company;
provided, however, if the holder who submitted the Exercise Notice requested physical delivery of
any or all of the Warrant Shares, or, if the Common Stock is not DTC eligible then the Company
shall, on or before the fifth (5th) Business Day following receipt of the Exercise
Delivery Documents, issue and surrender to a common carrier for overnight delivery to the address
specified in the Exercise Notice, a certificate, registered in the name of the holder, for the
number of shares of Common Stock to which the holder shall be entitled pursuant to such request.
Upon delivery of the Exercise Notice and Aggregate Exercise Price referred to in clause (i) or (ii)
above the holder of this Warrant shall be deemed for all corporate purposes to have become the
holder of record of the Warrant Shares with respect to which this Warrant has been exercised. In
the case of a dispute as to the determination of the Warrant Exercise Price, the Closing Bid Price
or the arithmetic calculation of the Warrant Shares, the Company shall promptly issue to the holder
the number of Warrant Shares that is not disputed and shall submit the disputed determinations or
arithmetic calculations to the holder via facsimile within one (1) Business Day of receipt of the
holder’s Exercise Notice.

(b) If the holder and the Company are unable to agree upon the determination of the Warrant
Exercise Price or arithmetic calculation of the Warrant Shares within one (1) day of such disputed
determination or arithmetic calculation being submitted to the holder, then the Company shall
immediately submit via facsimile (i) the disputed determination of the Warrant Exercise Price or
the Closing Bid Price to an independent, reputable investment banking firm or (ii) the disputed
arithmetic calculation of the Warrant Shares to its independent, outside accountant. The Company
shall cause the investment banking firm or the accountant, as the case may be, to perform the
determinations or calculations and notify the Company and the holder of the results no later than
forty-eight (48) hours from the time it receives the disputed determinations or calculations. Such
investment banking firm’s or accountant’s determination or calculation, as the case may be, shall
be deemed conclusive absent manifest error.

(c) Unless the rights represented by this Warrant shall have expired or shall have been fully
exercised, the Company shall, as soon as practicable and in no event later than five (5) Business
Days after any exercise and at its own expense, issue a new Warrant identical in all respects to
this Warrant exercised except it shall represent rights to purchase the number of Warrant Shares
purchasable immediately prior to such exercise under this Warrant exercised, less the number of
Warrant Shares with respect to which such Warrant is exercised.

(d) No fractional Warrant Shares are to be issued upon any pro rata exercise of this Warrant,
but rather the number of Warrant Shares issued upon such exercise of this Warrant shall be rounded
up or down to the nearest whole number.

(e) If the Company or its Transfer Agent shall fail for any reason or for no reason to issue
to the holder within ten (10) days of receipt of the Exercise Delivery Documents, a certificate for
the number of Warrant Shares to which the holder is entitled or to credit the holder’s balance
account with The Depository Trust Company for such number of Warrant Shares to which the holder is
entitled upon the holder’s exercise of this Warrant, the Company shall, in addition to any other
remedies under this Warrant or the Placement Agent Agreement or otherwise available to such holder,
pay as additional damages in cash to such holder on each day the issuance of such certificate for
Warrant Shares is not timely effected an amount equal to 0.025% of the product of (A) the sum of
the number of Warrant Shares not issued to the holder on a timely basis and to which the holder is
entitled, and (B) the Closing Bid Price of the Common Stock for the trading day immediately
preceding the last possible date which the Company could have issued such Common Stock to the
holder without violating this Section 2.

(f) If within ten (10) days after the Company’s receipt of the Exercise Delivery Documents,
the Company fails to deliver a new Warrant to the holder for the number of Warrant Shares to which
such holder is entitled pursuant to Section 2 hereof, then, in addition to any other available
remedies under this Warrant or the Placement Agent Agreement, or otherwise available to such
holder, the Company shall pay as additional damages in cash to such holder on each day after such
tenth (10th) day that such delivery of such new Warrant is not timely effected in an
amount equal to 0.25% of the product of (A) the number of Warrant Shares represented by the portion
of this Warrant which is not being exercised and (B) the Closing Bid Price of the Common Stock for
the trading day immediately preceding the last possible date which the Company could have issued
such Warrant to the holder without violating this Section 2.

Section 3. Covenants as to Common Stock. The Company hereby covenants and agrees as
follows:

(a) This Warrant is, and any Warrants issued in substitution for or replacement of this
Warrant will upon issuance be, duly authorized and validly issued.

(b) All Warrant Shares which may be issued upon the exercise of the rights represented by this
Warrant will, upon issuance, be validly issued, fully paid and nonassessable and free from all
taxes, liens and charges with respect to the issue thereof.

(c) During the period within which the rights represented by this Warrant may be exercised,
the Company will at all times have authorized and reserved at least one hundred percent (100%) of
the number of shares of Common Stock needed to provide for the exercise of the rights then
represented by this Warrant and the par value of said shares will at all times be less than or
equal to the applicable Warrant Exercise Price. If at any time the Company does not have a
sufficient number of shares of Common Stock authorized and available, then the Company shall call
and hold a special meeting of its stockholders within sixty (60) days of that time for the sole
purpose of increasing the number of authorized shares of Common Stock.

(d) If at any time after the date hereof the Company shall file a registration statement, the
Company shall include the Warrant Shares issuable to the holder, pursuant to the terms of this
Warrant and shall maintain, so long as any other shares of Common Stock shall be so listed, such
listing of all Warrant Shares from time to time issuable upon the exercise of this Warrant; and the
Company shall so list on each national securities exchange or automated quotation system, as the
case may be, and shall maintain such listing of, any other shares of capital stock of the Company
issuable upon the exercise of this Warrant if and so long as any shares of the same class shall be
listed on such national securities exchange or automated quotation system.

(e) The Company will not, by amendment of its Articles of Incorporation or through any
reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of
securities, or any other voluntary action, avoid or seek to avoid the observance or performance of
any of the terms to be observed or performed by it hereunder, but will at all times in good faith
assist in the carrying out of all the provisions of this Warrant and in the taking of all such
action as may reasonably be requested by the holder of this Warrant in order to protect the
exercise privilege of the holder of this Warrant against dilution or other impairment, consistent
with the tenor and purpose of this Warrant. The Company will not increase the par value of any
shares of Common Stock receivable upon the exercise of this Warrant above the Warrant Exercise
Price then in effect, and (ii) will take all such actions as may be necessary or appropriate in
order that the Company may validly and legally issue fully paid and nonassessable shares of Common
Stock upon the exercise of this Warrant.

(f) This Warrant will be binding upon any entity succeeding to the Company by merger,
consolidation or acquisition of all or substantially all of the Company’s assets.

Section 4. Taxes. The Company shall pay any and all taxes, except any applicable
withholding, which may be payable with respect to the issuance and delivery of Warrant Shares to
the Holder upon exercise of this Warrant.

Section 5. Warrant Holder Not Deemed a Stockholder. Except as otherwise specifically
provided herein, no holder, as such, of this Warrant shall be entitled to vote or receive dividends
or be deemed the holder of shares of capital stock of the Company for any purpose, nor shall
anything contained in this Warrant be construed to confer upon the holder hereof, as such, any of
the rights of a stockholder of the Company or any right to vote, give or withhold consent to any
corporate action (whether any reorganization, issue of stock, reclassification of stock,
consolidation, merger, conveyance or otherwise), receive notice of meetings, receive dividends or
subscription rights, or otherwise, prior to the issuance to the holder of this Warrant of the
Warrant Shares which he or she is then entitled to receive upon the due exercise of this Warrant.
In addition, nothing contained in this Warrant shall be construed as imposing any liabilities on
such holder to purchase any securities (upon exercise of this Warrant or otherwise) or as a
stockholder of the Company, whether such liabilities are asserted by the Company or by creditors of
the Company. Notwithstanding this Section 5, the Company will provide the holder of this Warrant
with copies of the same notices and other information given to the stockholders of the Company
generally, contemporaneously with the giving thereof to the stockholders.

Section 6. Representations of Holder. The holder of this Warrant, by the acceptance
hereof, represents that it is acquiring this Warrant and the Warrant Shares for its own account for
investment only and not with a view towards, or for resale in connection with, the public sale or
distribution of this Warrant or the Warrant Shares, except pursuant to sales registered or exempted
under the Securities Act; provided, however, that by making the representations herein, the holder
does not agree to hold this Warrant or any of the Warrant Shares for any minimum or other specific
term and reserves the right to dispose of this Warrant and the Warrant Shares at any time in
accordance with or pursuant to a registration statement or an exemption under the Securities Act.
The holder of this Warrant further represents, by acceptance hereof, that, as of this date, such
holder is an “accredited investor” as such term is defined in Rule 501(a)(1) of Regulation D
promulgated by the Securities and Exchange Commission under the Securities Act (an “Accredited
Investor”). Upon exercise of this Warrant the holder shall, if requested by the Company,
confirm in writing, in a form satisfactory to the Company, that the Warrant Shares so purchased are
being acquired solely for the holder’s own account and not as a nominee for any other party, for
investment, and not with a view toward distribution or resale and that such holder is an Accredited
Investor. If such holder cannot make such representations because they would be factually
incorrect, it shall be a condition to such holder’s exercise of this Warrant that the Company
receive such other representations as the Company considers reasonably necessary to assure the
Company that the issuance of its securities upon exercise of this Warrant shall not violate any
United States or state securities laws.

Section 7. Ownership and Transfer.

(a) The Company shall maintain at its principal executive offices (or such other office or
agency of the Company as it may designate by notice to the holder hereof), a register for this
Warrant, in which the Company shall record the name and address of the person in whose name this
Warrant has been issued, as well as the name and address of each transferee. The Company may treat
the person in whose name any Warrant is registered on the register as the owner and holder thereof
for all purposes, notwithstanding any notice to the contrary, but in all events recognizing any
transfers made in accordance with the terms of this Warrant.

Section 8. Adjustment of Warrant Exercise Price and Number of Shares. The Warrant
Exercise Price and the number of shares of Common Stock issuable upon exercise of this Warrant
shall be adjusted from time to time as follows:

(a) Adjustment of Warrant Exercise Price and Number of Shares upon Issuance of Common
Stock. If and whenever on or after the Issuance Date of this Warrant, the Company issues or
sells, or is deemed to have issued or sold, any shares of Common Stock (other than (i) Excluded
Securities and (ii) shares of Common Stock which are issued or deemed to have been issued by the
Company in connection with an Approved Stock Plan or upon exercise or conversion of the Other
Securities) for a consideration per share less than a price (the “Applicable Price”) equal
to the Warrant Exercise Price in effect immediately prior to such issuance or sale, then
immediately after such issue or sale the Warrant Exercise Price then in effect shall be reduced to
an amount equal to such consideration per share. Upon each such adjustment of the Warrant Exercise
Price hereunder, the number of Warrant Shares issuable upon exercise of this Warrant shall be
adjusted to the number of shares determined by multiplying the Warrant Exercise Price in effect
immediately prior to such adjustment by the number of Warrant Shares issuable upon exercise of this
Warrant immediately prior to such adjustment and dividing the product thereof by the Warrant
Exercise Price resulting from such adjustment.

(b) Effect on Warrant Exercise Price of Certain Events. For purposes of determining
the adjusted Warrant Exercise Price under Section 8(a) above, the following shall be applicable:

(i) Issuance of Options. If after the date hereof, the Company in any manner grants
any Options and the lowest price per share for which one share of Common Stock is issuable upon the
exercise of any such Option or upon conversion or exchange of any convertible securities issuable
upon exercise of any such Option is less than the Applicable Price, then such share of Common Stock
shall be deemed to be outstanding and to have been issued and sold by the Company at the time of
the granting or sale of such Option for such price per share. For purposes of this Section
8(b)(i), the lowest price per share for which one share of Common Stock is issuable upon exercise
of such Options or upon conversion or exchange of such Convertible Securities shall be equal to the
sum of the lowest amounts of consideration (if any) received or receivable by the Company with
respect to any one share of Common Stock upon the granting or sale of the Option, upon exercise of
the Option or upon conversion or exchange of any convertible security issuable upon exercise of
such Option. No further adjustment of the Warrant Exercise Price shall be made upon the actual
issuance of such Common Stock or of such convertible securities upon the exercise of such Options
or upon the actual issuance of such Common Stock upon conversion or exchange of such convertible
securities.

(ii) Issuance of Convertible Securities. If the Company in any manner issues or sells
any convertible securities and the lowest price per share for which one share of Common Stock is
issuable upon the conversion or exchange thereof is less than the Applicable Price, then such share
of Common Stock shall be deemed to be outstanding and to have been issued and sold by the Company
at the time of the issuance or sale of such convertible securities for such price per share. For
the purposes of this Section 8(b)(ii), the lowest price per share for which one share of Common
Stock is issuable upon such conversion or exchange shall be equal to the sum of the lowest amounts
of consideration (if any) received or receivable by the Company with respect to one share of Common
Stock upon the issuance or sale of the convertible security and upon conversion or exchange of such
convertible security. No further adjustment of the Warrant Exercise Price shall be made upon the
actual issuance of such Common Stock upon conversion or exchange of such convertible securities,
and if any such issue or sale of such convertible securities is made upon exercise of any Options
for which adjustment of the Warrant Exercise Price had been or are to be made pursuant to other
provisions of this Section 8(b), no further adjustment of the Warrant Exercise Price shall be made
by reason of such issue or sale.

(iii) Change in Option Price or Rate of Conversion. If the purchase price provided
for in any Options, the additional consideration, if any, payable upon the issue, conversion or
exchange of any convertible securities, or the rate at which any convertible securities are
convertible into or exchangeable for Common Stock changes at any time, the Warrant Exercise Price
in effect at the time of such change shall be adjusted to the Warrant Exercise Price which would
have been in effect at such time had such Options or convertible securities provided for such
changed purchase price, additional consideration or changed conversion rate, as the case may be, at
the time initially granted, issued or sold and the number of Warrant Shares issuable upon exercise
of this Warrant shall be correspondingly readjusted. For purposes of this Section 8(b)(iii), if
the terms of any Option or convertible security that was outstanding as of the Issuance Date of
this Warrant are changed in the manner described in the immediately preceding sentence, then such
Option or convertible security and the Common Stock deemed issuable upon exercise, conversion or
exchange thereof shall be deemed to have been issued as of the date of such change. No adjustment
pursuant to this Section 8(b) shall be made if such adjustment would result in an increase of the
Warrant Exercise Price then in effect.

(c) Effect on Warrant Exercise Price of Certain Events. For purposes of determining
the adjusted Warrant Exercise Price under Sections 8(a) and 8(b), the following shall be
applicable:

(i) Calculation of Consideration Received. If any Common Stock, Options or
convertible securities are issued or sold or deemed to have been issued or sold for cash, the
consideration received therefore will be deemed to be the net amount received by the Company
therefore. If any Common Stock, Options or convertible securities are issued or sold for a
consideration other than cash, the amount of such consideration received by the Company will be the
fair value of such consideration, except where such consideration consists of marketable
securities, in which case the amount of consideration received by the Company will be the market
price of such securities on the date of receipt of such securities. If any Common Stock, Options
or convertible securities are issued to the owners of the non-surviving entity in connection with
any merger in which the Company is the surviving entity, the amount of consideration therefore will
be deemed to be the fair value of such portion of the net assets and business of the non-surviving
entity as is attributable to such Common Stock, Options or convertible securities, as the case may
be. The fair value of any consideration other than cash or securities will be determined jointly
by the Company and the holders of Warrants representing at least two-thirds (b) of the Warrant
Shares issuable upon exercise of the Warrants then outstanding. If such parties are unable to
reach agreement within ten (10) days after the occurrence of an event requiring valuation (the
“Valuation Event”), the fair value of such consideration will be determined within five (5)
Business Days after the tenth (10th) day following the Valuation Event by an
independent, reputable appraiser jointly selected by the Company and the holders of Warrants
representing at least two-thirds (b) of the Warrant Shares issuable upon exercise of the Warrants
then outstanding. The determination of such appraiser shall be final and binding upon all parties
and the fees and expenses of such appraiser shall be borne jointly by the Company and the holders
of Warrants.

(ii) Integrated Transactions. In case any Option is issued in connection with the
issue or sale of other securities of the Company, together comprising one integrated transaction in
which no specific consideration is allocated to such Options by the parties thereto, the Options
will be deemed to have been issued for a consideration of $.01.

(iii) Treasury Shares. The number of shares of Common Stock outstanding at any given
time does not include shares owned or held by or for the account of the Company, and the
disposition of any shares so owned or held will be considered an issue or sale of Common Stock.

(iv) Record Date. If the Company takes a record of the holders of Common Stock for
the purpose of entitling them (1) to receive a dividend or other distribution payable in Common
Stock, Options or in convertible securities or (2) to subscribe for or purchase Common Stock,
Options or convertible securities, then such record date will be deemed to be the date of the issue
or sale of the shares of Common Stock deemed to have been issued or sold upon the declaration of
such dividend or the making of such other distribution or the date of the granting of such right of
subscription or purchase, as the case may be.

(d) Adjustment of Warrant Exercise Price upon Subdivision or Combination of Common
Stock. If the Company at any time after the date of issuance of this Warrant subdivides (by
any stock split, stock dividend, recapitalization or otherwise) one or more classes of its
outstanding shares of Common Stock into a greater number of shares, any Warrant Exercise Price in
effect immediately prior to such subdivision will be proportionately reduced and the number of
shares of Common Stock obtainable upon exercise of this Warrant will be proportionately increased.
If the Company at any time after the date of issuance of this Warrant combines (by combination,
reverse stock split or otherwise) one or more classes of its outstanding shares of Common Stock
into a smaller number of shares, any Warrant Exercise Price in effect immediately prior to such
combination will be proportionately increased and the number of Warrant Shares issuable upon
exercise of this Warrant will be proportionately decreased. Any adjustment under this Section 8(d)
shall become effective at the close of business on the date the subdivision or combination becomes
effective.

(e) Distribution of Assets. If the Company shall declare or make any dividend or
other distribution of its assets (or rights to acquire its assets) to holders of Common Stock, by
way of return of capital or otherwise (including, without limitation, any distribution of cash,
stock or other securities, property or options by way of a dividend, spin off, reclassification,
corporate rearrangement or other similar transaction) (a “Distribution”), at any time after
the issuance of this Warrant, then, in each such case:

(i) any Warrant Exercise Price in effect immediately prior to the close of business on the
record date fixed for the determination of holders of Common Stock entitled to receive the
Distribution shall be reduced, effective as of the close of business on such record date, to a
price determined by multiplying such Warrant Exercise Price by a fraction of which (A) the
numerator shall be the Closing Sale Price of the Common Stock on the trading day immediately
preceding such record date minus the value of the Distribution (as determined in good faith by the
Company’s Board of Directors) applicable to one share of Common Stock, and (B) the denominator
shall be the Closing Sale Price of the Common Stock on the trading day immediately preceding such
record date; and

(ii) either (A) the number of Warrant Shares obtainable upon exercise of this Warrant shall be
increased to a number of shares equal to the number of shares of Common Stock obtainable
immediately prior to the close of business on the record date fixed for the determination of
holders of Common Stock entitled to receive the Distribution multiplied by the reciprocal of the
fraction set forth in the immediately preceding clause (i), or (B) in the event that the
Distribution is of common stock of a company whose common stock is traded on a national securities
exchange or a national automated quotation system, then the holder of this Warrant shall receive an
additional warrant to purchase Common Stock, the terms of which shall be identical to those of this
Warrant, except that such warrant shall be exercisable into the amount of the assets that would
have been payable to the holder of this Warrant pursuant to the Distribution had the holder
exercised this Warrant immediately prior to such record date and with an exercise price equal to
the amount by which the exercise price of this Warrant was decreased with respect to the
Distribution pursuant to the terms of the immediately preceding clause (i).

(f) Certain Events. If any event occurs of the type contemplated by the provisions of
this Section 8 but not expressly provided for by such provisions (including, without limitation,
the granting of stock appreciation rights, phantom stock rights or other rights with equity
features), then the Company’s Board of Directors will make an appropriate adjustment in the Warrant
Exercise Price and the number of shares of Common Stock obtainable upon exercise of this Warrant so
as to protect the rights of the holders of the Warrants; provided, except as set forth in section
8(d),that no such adjustment pursuant to this Section 8(f) will increase the Warrant Exercise Price
or decrease the number of shares of Common Stock obtainable as otherwise determined pursuant to
this Section 8.

(g) Notices.

(i) Immediately upon any adjustment of the Warrant Exercise Price, the Company will give
written notice thereof to the holder of this Warrant, setting forth in reasonable detail, and
certifying, the calculation of such adjustment.

(ii) The Company will give written notice to the holder of this Warrant at least ten (10) days
prior to the date on which the Company closes its books or takes a record (A) with respect to any
dividend or distribution upon the Common Stock, (B) with respect to any pro rata subscription offer
to holders of Common Stock or (C) for determining rights to vote with respect to any Organic Change
(as defined below), dissolution or liquidation, provided that such information shall be made known
to the public prior to or in conjunction with such notice being provided to such holder.

(iii) The Company will also give written notice to the holder of this Warrant at least ten
(10) days prior to the date on which any Organic Change, dissolution or liquidation will take
place, provided that such information shall be made known to the public prior to or in conjunction
with such notice being provided to such holder.

(h) Limitations. Notwithstanding the above provisions of this Section 8, the number of shares
of Common Stock issuable upon exercise of this Warrant shall in no event be increased to an amount
such that the Total Transaction Shares (as defined below) shall be equal to or greater than
9,699,143 shares of Common Stock (which is no more than 19.99% of at least 48,739,415 outstanding
shares of Common Stock as of the execution of the Standby Equity Distribution Agreement between the
Company and Cornell dated July 15, 2005 (“SEDA”)), until the holders of Common Stock
approve the issuance of the Total Transaction Shares. “Total Transaction Shares” shall
mean, in the aggregate, the shares of Common Stock issued or issuable to Cornell or its affiliates,
and transferees, subsequent transferees, or any other party pursuant to the Securities Purchase
Agreement of even date herewith among the Company and Cornell, the Pledge and Escrow Agreement of
even date herewith among the Company, Cornell, and David Gonzalez, Esq. (the “Pledge Agreement”),
the Placement Agent Agreement dated as of July 15, 2005 among the Company, Cornell and Monitor
Capital, Inc., and the SEDA, together with the Warrant Shares.

Section 9. Purchase Rights; Reorganization, Reclassification, Consolidation, Merger or
Sale.

(a) In addition to any adjustments pursuant to Section 8 above, if at any time the Company
grants, issues or sells any Options, Convertible Securities or rights to purchase stock, warrants,
securities or other property pro rata to the record holders of any class of Common Stock (the
“Purchase Rights”), then the holder of this Warrant will be entitled to acquire, upon the
terms applicable to such Purchase Rights, the aggregate Purchase Rights which such holder could
have acquired if such holder had held the number of shares of Common Stock acquirable upon complete
exercise of this Warrant immediately before the date on which a record is taken for the grant,
issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the
record holders of Common Stock are to be determined for the grant, issue or sale of such Purchase
Rights.

(b) Any recapitalization, reorganization, reclassification, consolidation, merger, sale of all
or substantially all of the Company’s assets to another Person or other transaction in each case
which is effected in such a way that holders of Common Stock are entitled to receive (either
directly or upon subsequent liquidation) stock, securities or assets with respect to or in exchange
for Common Stock is referred to herein as an “Organic Change.” Prior to the consummation
of any (i) sale of all or substantially all of the Company’s assets to an acquiring Person or (ii)
other Organic Change following which the Company is not a surviving entity, the Company will secure
from the Person purchasing such assets or the successor resulting from such Organic Change (in each
case, the “Acquiring Entity”) a written agreement (in form and substance satisfactory to
the holders of Warrants representing at least two-thirds (iii) of the Warrant Shares issuable upon
exercise of the Warrants then outstanding) to deliver to each holder of Warrants in exchange for
such Warrants, a security of the Acquiring Entity evidenced by a written instrument substantially
similar in form and substance to this Warrant and satisfactory to the holders of the Warrants
(including an adjusted warrant exercise price equal to the value for the Common Stock reflected by
the terms of such consolidation, merger or sale, and exercisable for a quantity of securities or
assets of the acquirer corresponding to the number of shares of Common Stock acquirable and
receivable upon exercise of the Warrants without regard to any limitations on exercise, if the
value so reflected is less than any Applicable Warrant Exercise Price immediately prior to such
consolidation, merger or sale). Prior to the consummation of any other Organic Change, the Company
shall make appropriate provision (in form and substance satisfactory to the holders of Warrants
representing a majority of the Warrant Shares issuable upon exercise of the Warrants then
outstanding) to insure that each of the holders of the Warrants will thereafter have the right to
acquire and receive in lieu of or in addition to (as the case may be) the Warrant Shares
immediately theretofore issuable and receivable upon the exercise of such holder’s Warrants
(without regard to any limitations on exercise), such shares of stock, securities or assets that
would have been issued or payable in such Organic Change with respect to or in exchange for the
number of Warrant Shares which would have been issuable and receivable upon the exercise of such
holder’s Warrant as of the date of such Organic Change (without taking into account any limitations
or restrictions on the exercisability of this Warrant).

Section 10. Lost, Stolen, Mutilated or Destroyed Warrant. If this Warrant is lost,
stolen, mutilated or destroyed, the Company shall promptly, on receipt of an indemnification
undertaking (or, in the case of a mutilated Warrant, the Warrant), issue a new Warrant of like
denomination and tenor as this Warrant so lost, stolen, mutilated or destroyed.

Section 11. Notice. Any notices, consents, waivers or other communications required
or permitted to be given under the terms of this Warrant must be in writing and will be deemed to
have been delivered: (i) upon receipt, when delivered personally; (ii) upon receipt, when sent by
facsimile (provided confirmation of receipt is received by the sending party transmission is
mechanically or electronically generated and kept on file by the sending party); or (iii) one
Business Day after deposit with a nationally recognized overnight delivery service, in each case
properly addressed to the party to receive the same. The addresses and facsimile numbers for such
communications shall be:

	 	 	 	 	 
	If to Cornell:
	 	Cornell Capital Partners, LP

	 
	 	101 Hudson Street – Suite 3700
	 
	 	Jersey City, NJ  07302

	 
	 	Attention: Mark A. Angelo

	 
	 	Telephone: (201) 985-8300

	 
	 	Facsimile: (201) 985-8266

	With Copy to:
	 	David Gonzalez, Esq.

	 
	 	101 Hudson Street – Suite 3700
	 
	 	Jersey City, NJ 07302

	 
	 	Telephone: (201) 985-8300

	 
	 	Facsimile: (201) 985-8266

	If to the Company, to:
	 	The Immune Response Corporation

	 
	 	5391 Darwin Court
	 
	 	Carlsbad, CA 92008

	 
	 	Attention: Michael K. Green

	 
	 	Facsimile: (760) 431-8636

	With a copy to:
	 	Heller Ehrman LLP

	 
	 	4530 La Jolla Village Drive, 7th Floor
	 
	 	San Diego, CA 92122

	 
	 	Attention: Hayden J. Trubitt, Esq.

	 
	 	Facsimile: (858) 587-5903

Each party shall provide five days’ prior written notice to the other party of any change in
address or facsimile number. Written confirmation of receipt (A) given by the recipient of such
notice, consent, facsimile, waiver or other communication, (or (B) provided by a nationally
recognized overnight delivery service shall be rebuttable evidence of personal service, receipt by
facsimile or receipt from a nationally recognized overnight delivery service in accordance with
clause (i), (ii) or (iii) above, respectively.

Section 12. Date. The date of this Warrant is set forth on page 1 hereof. This
Warrant, in all events, shall be wholly void and of no effect after the close of business on the
Expiration Date.

Section 13. Amendment and Waiver. Except as otherwise provided herein, the provisions
of the Warrants may be amended and the Company may take any action herein prohibited, or omit to
perform any act herein required to be performed by it, only if the Company has obtained the written
consent of the holders of Warrants representing at least two-thirds of the Warrant Shares issuable
upon exercise of the Warrants then outstanding; provided that, except for Section 8(d), no such
action may increase the Warrant Exercise Price or decrease the number of shares or class of stock
obtainable upon exercise of any Warrant without the written consent of the holder of such Warrant.

Section 14. Descriptive Headings; Governing Law. The descriptive headings of the
several sections and paragraphs of this Warrant are inserted for convenience only and do not
constitute a part of this Warrant. The corporate laws of the State of Delaware shall govern all
issues concerning the relative rights of the Company and its stockholders. All other questions
concerning the construction, validity, enforcement and interpretation of this Agreement shall be
governed by the internal laws of the State of New Jersey, without giving effect to any choice of
law or conflict of law provision or rule (whether of the State of New Jersey or any other
jurisdictions) that would cause the application of the laws of any jurisdictions other than the
State of New Jersey. Each party hereby irrevocably submits to the exclusive jurisdiction of the
state and federal courts sitting in Hudson County and the United States District Court for the
District of New Jersey, for the adjudication of any dispute hereunder or in connection herewith or
therewith, or with any transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not
personally subject to the jurisdiction of any such court, that such suit, action or proceeding is
brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper.
Each party hereby irrevocably waives personal service of process and consents to process being
served in any such suit, action or proceeding by mailing a copy thereof to such party at the
address for such notices to it under this Agreement and agrees that such service shall constitute
good and sufficient service of process and notice thereof. Nothing contained herein shall be
deemed to limit in any way any right to serve process in any manner permitted by law.

Section 15. Waiver of Jury Trial. AS A MATERIAL INDUCEMENT FOR EACH PARTY HERETO TO
ENTER INTO THIS WARRANT, THE PARTIES HERETO HEREBY WAIVE ANY RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING RELATED IN ANY WAY TO THIS WARRANT AND/OR ANY AND ALL OF THE OTHER DOCUMENTS ASSOCIATED
WITH THIS TRANSACTION.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

1

IN WITNESS WHEREOF, the Company has caused this Warrant to be signed as of the date first set
forth above.

	 	 	 	 	 
	THE IMMUNE RESPONSE CORPORATION

	 
	By:

	 

	Name:

	Title:

2

EXHIBIT A TO WARRANT

EXERCISE NOTICE

TO BE EXECUTED

BY THE REGISTERED HOLDER TO EXERCISE THIS WARRANT

THE IMMUNE RESPONSE CORPORATION

The undersigned holder hereby exercises the right to purchase      of the shares of
Common Stock (“Warrant Shares”) of The Immune Response Corporation, a Delaware corporation
(the “Company”), evidenced by the attached Warrant (the “Warrant”). Capitalized
terms used herein and not otherwise defined shall have the respective meanings set forth in the
Warrant.

Specify Method of exercise by check mark:

1.      Cash Exercise

(a) Payment of Warrant Exercise Price. The holder shall pay the Aggregate
Exercise Price of $     to the Company in accordance with the terms of the
Warrant.

(b) Delivery of Warrant Shares. The Company shall deliver to the holder
     Warrant Shares in accordance with the terms of the Warrant.

2.      Cashless Exercise

(a) Payment of Warrant Exercise Price. In lieu of making payment of the
Aggregate Exercise Price, the holder elects to receive upon such exercise the Net
Number of shares of Common Stock determined in accordance with the terms of the
Warrant.

(b) Delivery of Warrant Shares. The Company shall deliver to the holder
     Warrant Shares in accordance with the terms of the Warrant.

Date:      ,      

Name of Registered Holder

By:

Name:

Title:

3

EXHIBIT B TO WARRANT

FORM OF WARRANT POWER

FOR VALUE RECEIVED, the undersigned does hereby assign and transfer to      ,
Federal Identification No.      , a warrant to purchase      shares of the capital
stock of The Immune Response Corporation, a Delaware corporation, represented by warrant
certificate no.      , standing in the name of the undersigned on the books of said corporation.
The undersigned does hereby irrevocably constitute and appoint      , attorney to transfer
the warrants of said corporation, with full power of substitution in the premises.

	 	 	 
	Dated:	 	 
	
 
	 	By:
	
 
	 	 
	 
	 	 
	
 
	 	Name:
	
 
	 	 
	 
	 	 
	
 
	 	Title:
	
 
	 	 
	 
	 	 

4

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