Document:

spafusion022008.htm

    Exhibit 10.35

     

    
      

      

    

    

      COMMON
STOCK PURCHASE AGREEMENT

      

      COMMON STOCK PURCHASE
AGREEMENT (the “Agreement”), dated as of February 14, 2008, by and
between DOR BioPharma,
Inc., a Delaware corporation (the “Company”), and Fusion Capital Fund II, LLC,
an Illinois limited liability company (the “Buyer”).  Capitalized
terms used herein and not otherwise defined herein are defined in Section 10
hereof.

      

      WHEREAS:

      

      Subject to the terms and conditions set
forth in this Agreement, the Company wishes to sell to the Buyer, and the Buyer
wishes to buy from the Company, up to Eight Million Five Hundred Thousand
($8,500,000) of the Company's common stock, $0.001 par value (the “Common
Stock”).  The shares of Common Stock to be purchased hereunder are
referred to herein as the "Purchase Shares."

      

      NOW THEREFORE, the Company and
the Buyer hereby agree as follows:

      

      1.           PURCHASE
OF COMMON STOCK.

      

      Subject to the terms and conditions set
forth in this Agreement, the Company has the right to sell to the Buyer, and the
Buyer has the obligation to purchase from the Company, Purchase Shares as
follows:

      

      (a)           Initial Purchases;
Commencement of Base and Block Purchases of Common
Stock.  Within one Business Day after the execution of this
Agreement, the Buyer shall purchase from the Company 2,777,778 Purchase Shares
and a common stock purchase warrant (the “Warrant” to
purchase  1,388,889 shares of Common Stock (the “Warrant Shares”) in
the form of Exhibit
F attached hereto and upon receipt of such Purchase Shares and the
Warrant, pay to the Company as the purchase price therefor, via wire transfer,
Five Hundred Thousand Dollars ($500,000) (such purchase the “Initial Purchase”
and such Purchase Shares are referred to herein as “Initial Purchase Shares” and
together with the 1,275,000 Initial Commitment Shares (as defined in Section
4(e) hereof), are referred to herein as the “Initial Shares”).  Upon
issuance and payment therefor as provided herein, such 2,777,778 Initial
Purchase Shares shall be, validly issued and are fully paid and
nonassessable.  The Initial Purchase Shares
shall be issued in certificated form and (subject to Section 5 hereof) shall
bear only the restrictive legend set forth in Section 4(e) hereof. Thereafter,
the purchase and sale of Purchase Shares hereunder shall occur from time to time
upon written notices by the Company to the Buyer on the terms and conditions as
set forth herein following the satisfaction of the conditions (the
“Commencement”) as set forth in Sections 6 and 7 below  (the date of
satisfaction of such conditions, the "Commencement Date").

      

      (b)           The Company’s Right to
Require Purchases.  Any time on or after the Commencement Date,
the Company shall have the right but not the obligation to direct the Buyer by
its delivery to the Buyer of Base Purchase Notices from time to time to buy
Purchase Shares (each such purchase a “Base Purchase”) in any amount up to
Eighty Thousand Dollars ($80,000) per Base Purchase Notice (the “Base Purchase
Amount”) at the Purchase Price on the Purchase Date.  The Company may
deliver multiple Base Purchase Notices to the Buyer so long as at least three
(3) Business Days have passed since the most recent Base Purchase was
completed.  Notwithstanding the forgoing, any time on or after the
Commencement Date, the Company shall also have the right but not the obligation
by its delivery to the Buyer of Block Purchase Notices from time to time to
direct the Buyer to buy Purchase Shares (each such purchase a “Block Purchase”)
in any amount up to One Million Dollars ($1,000,000) per Block Purchase Notice
at the Block Purchase Price on the Purchase Date as provided
herein.  For a Block Purchase Notice to be valid the following
conditions must be met: (1) the Block Purchase Amount shall not exceed One
Hundred Thousand Dollars ($100,000) per Block Purchase Notice, (2) the Company
must deliver the Purchase Shares before 11:00 a.m. eastern time on the Purchase
Date and (3) the Sale Price of the Common Stock must not be below $0.15 (subject
to equitable adjustment for any reorganization, recapitalization, non-cash
dividend, stock split or other similar transaction) during the Purchase Date,
the date of the delivery of the Block Purchase Notice and during the Business
Day prior to the delivery of the Block Purchase Notice.  The Block
Purchase Amount may be increased to up to Two Hundred Fifty Thousand Dollars
($250,000) per Block Purchase Notice if the Sale Price of the Common Stock is
not below $0.25 (subject to equitable adjustment for any reorganization,
recapitalization, non-cash dividend, stock split or other similar transaction)
during the Purchase Date, the date of the delivery of the Block Purchase Notice
and during the Business Day prior to the delivery of the Block Purchase
Notice.  The Block Purchase Amount may be increased to up to Five
Hundred Thousand Dollars ($500,000) per Block Purchase Notice if the Sale Price
of the Common Stock is not below $0.50 (subject to equitable adjustment for any
reorganization, recapitalization, non-cash dividend, stock split or other
similar transaction) during the Purchase Date, the date of the delivery of the
Block Purchase Notice and during the Business Day prior to the delivery of the
Block Purchase Notice.  The Block Purchase Amount may be increased to
up to One Million Dollars ($1,000,000) per Block Purchase Notice if the Sale
Price of the Common Stock is not below $1.00 (subject to equitable adjustment
for any reorganization, recapitalization, non-cash dividend, stock split or
other similar transaction) during the Purchase Date, the date of the delivery of
the Block Purchase Notice and during the Business Day prior to the delivery of
the Block Purchase Notice.  As used herein, the term “Block Purchase
Price” shall mean the lesser of (i) the lowest Sale Price of the Common Stock on
the Purchase Date or (ii) the lowest Purchase Price during the previous ten (10)
Business Days prior to the date that the valid Block Purchase Notice was
received by the Buyer.  However, if at any time during the Purchase
Date, the date of the delivery of the Block Purchase Notice or during the
Business Day prior to the delivery of the Block Purchase Notice, the Sale Price
of the Common Stock is below the applicable Block Purchase threshold price, such
Block Purchase shall be void and the Buyer’s obligations to buy Purchase Shares
in respect of that Block Purchase Notice shall be
terminated.  Thereafter, the Company shall again have the right to
submit a Block Purchase Notice as set forth herein by delivery of a new Block
Purchase Notice only if the Sale Price of the Common Stock is above the
applicable Block Purchase threshold price during the date of the delivery of the
Block Purchase Notice and during the Business Day prior to the delivery of the
Block Purchase Notice.  The Company may deliver multiple Block
Purchase Notices to the Buyer so long as at least two (2) Business Days have
passed since the most recent Block Purchase was completed.

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      (c)           Payment for Purchase
Shares.  The Buyer shall pay to the Company an amount equal to
the Purchase Amount with respect to such Purchase Shares as full payment for
such Purchase Shares via wire transfer of immediately available funds on the
same Business Day that the Buyer receives such Purchase Shares if they are
received by the Buyer before 11:00 a.m. eastern time or if received by the Buyer
after 11:00 a.m. eastern time, the next Business Day.  The Company
shall not issue any fraction of a share of Common Stock upon any
purchase.  If the issuance would result in the issuance of a fraction
of a share of Common Stock, the Company shall round such fraction of a share of
Common Stock up or down to the nearest whole share.  All payments made
under this Agreement shall be made in lawful money of the United States of
America or wire transfer of immediately available funds to such account as the
Company may from time to time designate by written notice in accordance with the
provisions of this Agreement.  Whenever any amount expressed to be due
by the terms of this Agreement is due on any day that is not a Business Day, the
same shall instead be due on the next succeeding day that is a Business
Day.

      

      (d)           Purchase Price
Floor.  The Company and the Buyer shall not effect any sales
under this Agreement on any Purchase Date where the Purchase Price for any
purchases of Purchase Shares would be less than the Floor
Price.   “Floor Price” means $0.10, which shall be appropriately
adjusted for any reorganization, recapitalization, non-cash dividend, stock
split or other similar transaction.

      

      (e)           Records of
Purchases.  The Buyer and the Company shall each maintain
records showing the remaining Available Amount at any give time and the dates
and Purchase Amounts for each purchase or shall use such other method,
reasonably satisfactory to the Buyer and the Company.

      

      (f)           Taxes.  The
Company shall pay any and all transfer, stamp or similar taxes that may be
payable with respect to the issuance and delivery of any shares of Common Stock
to the Buyer made under this Agreement.

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      2.           BUYER'S
REPRESENTATIONS AND WARRANTIES.

      

      The Buyer
represents and warrants to the Company that as of the date hereof and as of the
Commencement Date:

      

      (a)           Investment
Purpose.  The Buyer is entering into this Agreement and
acquiring the Securities (the Purchase Shares (including the Initial Purchase
Shares), the Commitment Shares (as defined in Section 4(e) hereof), the Warrant
and the Warrant Shares are collectively referred to herein as the "Securities"),
for its own account for investment only and not with a view towards, or for
resale in connection with, the public sale or distribution thereof; provided
however, by making the representations herein, the Buyer does not agree to hold
any of the Securities for any minimum or other specific term other than as set
forth in Section 4(e) with respect to the Commitment Shares.

      

      (b)           Accredited Investor
Status.  The Buyer is an "accredited investor" as that term is
defined in Rule 501(a)(3) of Regulation D.

      

      (c)           Reliance on
Exemptions.  The Buyer understands that the Securities are
being offered and sold to it in reliance on specific exemptions from the
registration requirements of United States federal and state securities laws and
that the Company is relying in part upon the truth and accuracy of, and the
Buyer's compliance with, the representations, warranties, agreements,
acknowledgments and understandings of the Buyer set forth herein in order to
determine the availability of such exemptions and the eligibility of the Buyer
to acquire the Securities.

      

      (d)           Information.  The
Buyer has been furnished with all materials relating to the business, finances
and operations of the Company and materials relating to the offer and sale of
the Securities that have been reasonably requested by the Buyer, including,
without limitation, the SEC Documents (as defined in Section 3(f)
hereof).  The Buyer understands that its investment in the Securities
involves a high degree of risk.  The Buyer (i) is able to bear the
economic risk of an investment in the Securities including a total loss, (ii)
has such knowledge and experience in financial and business matters that it is
capable of evaluating the merits and risks of the proposed investment in the
Securities and (iii) has had an opportunity to ask questions of and receive
answers from the officers of the Company concerning the financial condition and
business of the Company and others matters related to an investment in the
Securities.  Neither such inquiries nor any other due diligence
investigations conducted by the Buyer or its representatives shall modify, amend
or affect the Buyer's right to rely on the Company's representations and
warranties contained in Section 3 below.  The Buyer has sought such
accounting, legal and tax advice as it has considered necessary to make an
informed investment decision with respect to its acquisition of the
Securities.

      

      (e)           No Governmental
Review.  The Buyer understands that no United States federal or
state agency or any other government or governmental agency has passed on or
made any recommendation or endorsement of the Securities or the fairness or
suitability of the investment in the Securities nor have such authorities passed
upon or endorsed the merits of the offering of the Securities.

      

      (f)           Transfer or
Sale.  The Buyer understands that except as provided in the
Registration Rights Agreement (as defined in Section 4(a) hereof): (i) the
Securities have not been and are not being registered under the 1933 Act or any
state securities laws, and may not be offered for sale, sold, assigned or
transferred unless (A) subsequently registered thereunder or (B) an exemption
exists permitting such Securities to be sold, assigned or transferred without
such registration; (ii) any sale of the Securities made in reliance on Rule 144
may be made only in accordance with the terms of Rule 144 and further, if Rule
144 is not applicable, any resale of the  Securities under
circumstances in which the seller (or the person through whom the sale is made)
may be deemed to be an underwriter (as that term is defined in the 1933 Act) may
require compliance with some other exemption under the 1933 Act or the rules and
regulations of the SEC thereunder; and (iii) neither the Company nor any other
person is under any obligation to register the Securities under the 1933 Act or
any state securities laws or to comply with the terms and conditions of any
exemption thereunder.

      

      (g)           Validity;
Enforcement.  This Agreement has been duly and validly
authorized, executed and delivered on behalf of the Buyer and is a valid and
binding agreement of the Buyer enforceable against the Buyer in accordance with
its terms, subject as to enforceability to general principles of equity and to
applicable bankruptcy, insolvency, reorganization, moratorium, liquidation and
other similar laws relating to, or affecting generally, the enforcement of
applicable creditors' rights and remedies.

      

      (h)           Residency.  The
Buyer is a resident of the State of Illinois.

      

      (i)           No Prior Short
Selling.  The Buyer represents and warrants to the Company that
at no time prior to the date of this Agreement has any of the Buyer, its agents,
representatives or affiliates engaged in or effected, in any manner whatsoever,
directly or indirectly, any (i) "short sale" (as such term is defined in Section
242.200 of Regulation SHO of the Securities Exchange Act of 1934, as amended
(the "1934 Act")) of the Common Stock or (ii) hedging transaction, which
establishes a net short position with respect to the Common Stock.

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      

      3.           REPRESENTATIONS
AND WARRANTIES OF THE COMPANY.

      

      The
Company represents and warrants to the Buyer that as of the date hereof and as
of the Commencement Date:

      

      (a)           Organization and
Qualification.  The Company and its "Subsidiaries" (which for
purposes of this Agreement means any entity in which the Company, directly or
indirectly, owns 50% or more of the voting stock or capital stock or other
similar equity interests) are corporations duly organized and validly existing
in good standing under the laws of the jurisdiction in which they are
incorporated, and have the requisite corporate power and authority to own their
properties and to carry on their business as now being
conducted.  Except as set forth in Schedule 3(a), each of the Company
and its Subsidiaries is duly qualified as a foreign corporation to do business
and is in good standing in every jurisdiction in which its ownership of property
or the nature of the business conducted by it makes such qualification
necessary, except to the extent that the failure to be so qualified or be in
good standing could not reasonably be expected to have a Material Adverse
Effect.  As used in this Agreement, "Material Adverse Effect" means
any material adverse effect on any of: (i) the business, properties, assets,
operations, results of operations or financial condition of the Company and its
Subsidiaries, if any, taken as a whole, or (ii) the authority or ability of the
Company to perform its obligations under the Transaction Documents (as defined
in Section 3(b) hereof).  The Company has no Subsidiaries except as
set forth on Schedule 3(a).

      

      (b)           Authorization; Enforcement;
Validity.  (i) The Company has the requisite corporate power
and authority to enter into and perform its obligations under this Agreement,
the Registration Rights Agreement, the Warrant and each of the other agreements
entered into by the parties on the Commencement Date and attached hereto as
exhibits to this Agreement (collectively, the "Transaction Documents"), and to
issue the Securities in accordance with the terms hereof and thereof, (ii) the
execution and delivery of the Transaction Documents by the Company and the
consummation by it of the transactions contemplated hereby and thereby,
including without limitation, the issuance of the Initial Shares and the Warrant
and the reservation for issuance and the issuance of additional Purchase Shares
issuable under this Agreement, have been duly authorized by the Company's Board
of Directors and no further consent or authorization is required by the Company,
its Board of Directors or its shareholders, (iii) this Agreement has been, and
each other Transaction Document shall be on the Commencement Date, duly executed
and delivered by the Company and (iv) this Agreement constitutes, and each other
Transaction Document upon its execution on behalf of the Company, shall
constitute, the valid and binding obligations of the Company enforceable against
the Company in accordance with their terms, except as such enforceability may be
limited by general principles of equity or applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation or similar laws relating to, or
affecting generally, the enforcement of creditors' rights and
remedies.  The Board of Directors of the Company has approved the
resolutions (the “Signing Resolutions”) substantially in the form as set forth
as Exhibit C-1
attached hereto to authorize this Agreement and the transactions contemplated
hereby.  The Signing Resolutions are valid, in full force and effect
and have not been modified or supplemented in any respect other than by the
resolutions set forth in Exhibit C-2 attached
hereto regarding the registration statement referred to in Section 4
hereof.  The Company has delivered to the Buyer a true and correct
copy of a unanimous written consent adopting the Signing Resolutions executed by
all of the members of the Board of Directors of the Company.  No other
approvals or consents of the Company’s Board of Directors and/or shareholders is
necessary under applicable laws and the Company’s Certificate of Incorporation
and/or Bylaws to authorize the execution and delivery of this Agreement or any
of the transactions contemplated hereby, including, but not limited to, the
issuance of the Commitment Shares, the Warrant, the Initial Purchase Shares and
the issuance of any additional Purchase Shares.

      

      (c)           Capitalization.  The
authorized capital stock of the Company consists of: 250,000,000 shares of
Common Stock, of which as of the date hereof, 95,191,999 shares are issued
and outstanding, 10,349,839 shares are reserved for issuance pursuant to
the Company's stock option plans of which only approximately 10,612,961
shares remain available for future grants and 29,209,341 shares are
issuable and reserved for issuance pursuant to securities (other than stock
options issued pursuant to the Company's stock option plans) exercisable or
exchangeable for, or convertible into, shares of Common Stock and (ii) 4,600,000
shares of Preferred Stock, $0.001 par value, of which as of the date
hereof no shares are issued or outstanding, 200,000 shares of Series B
Convertible Preferred Stock, $0.05 par value, of which as of the
date hereof no shares are issued or outstanding, and 200,000 of
Series C Convertible Preferred Stock, $0.05 par value, of which as of the date
hereof, no shares are issued or outstanding, and no other Preferred
Stock is outstanding. All of such outstanding shares have been, or upon issuance
will be, validly issued and are fully paid and nonassessable.  Except
as disclosed in Schedule 3(c), (i) no shares of the Company's capital stock are
subject to preemptive rights or any other similar rights or any liens or
encumbrances suffered or permitted by the Company, (ii) there are no outstanding
debt securities, (iii) there are no outstanding options, warrants, scrip, rights
to subscribe to, calls or commitments of any character whatsoever relating to,
or securities or rights convertible into, any shares of capital stock of the
Company or any of its Subsidiaries, or contracts, commitments, understandings or
arrangements by which the Company or any of its Subsidiaries is or may become
bound to issue additional shares of capital stock of the Company or any of its
Subsidiaries or options, warrants, scrip, rights to subscribe to, calls or
commitments of any character whatsoever relating to, or securities or rights
convertible into, any shares of capital stock of the Company or any of its
Subsidiaries, (iv) there are no agreements or arrangements under which the
Company or any of its Subsidiaries is obligated to register the sale of any of
their securities under the 1933 Act (except the Registration Rights Agreement
and except for agreements disclosed in Schedule 3 (c)), (v) there are no
outstanding securities or instruments of the Company or any of its Subsidiaries
which contain any redemption or similar provisions, and there are no contracts,
commitments, understandings or arrangements by which the Company or any of its
Subsidiaries is or may become bound to redeem a security of the Company or any
of its Subsidiaries, (vi) there are no securities or instruments containing
anti-dilution or similar provisions that will be triggered by the issuance of
the Securities as described in this Agreement and (vii) the Company does not
have any stock appreciation rights or "phantom stock" plans or agreements or any
similar plan or agreement.  The Company has furnished to the Buyer
true and correct copies of the Company's Certificate of Incorporation, as
amended and as in effect on the date hereof (the "Certificate of
Incorporation"), and the Company's By-laws, as amended and as in effect on the
date hereof (the "By-laws"), and summaries of the terms of all securities
convertible into or exercisable for Common Stock, if any, and copies of any
documents containing the material rights of the holders thereof in respect
thereto.

      

      (d)           Issuance of
Securities.  The 4,052,778 Initial Shares have been duly
authorized and, upon issuance in accordance with the terms hereof, the Initial
Shares shall be (i) validly issued, fully paid and non-assessable and (ii) free
from all taxes, liens and charges with respect to the issue thereof. 20,000,000
shares of Common Stock have been duly authorized and reserved for issuance upon
purchase under this Agreement after the Commencement. 1,275,000 shares of Common
Stock (subject to equitable adjustment for any reorganization, recapitalization,
non-cash dividend, stock split or other similar transaction) have been duly
authorized and reserved for issuance as Additional Commitment Shares in
accordance with Section 4(e) this Agreement.  Upon issuance and
payment therefor in accordance with the terms and conditions of this Agreement,
the Purchase Shares shall be validly issued, fully paid and nonassessable and
free from all taxes, liens and charges with respect to the issue thereof, with
the holders being entitled to all rights accorded to a holder of Common Stock.
Upon issuance and payment therefor in accordance with the terms and conditions
of the Warrant, the Warrant Shares shall be validly issued, fully paid and
nonassessable and free from all taxes, liens and charges with respect to the
issue thereof, with the holders being entitled to all rights accorded to a
holder of Common Stock. 1,388,889 shares of Common Stock have been duly
authorized and reserved for issuance upon exercise of the Warrant.

      

      (e)           No
Conflicts.  Except as disclosed in Schedule 3(e), the
execution, delivery and performance of the Transaction Documents by the Company
and the consummation by the Company of the transactions contemplated hereby and
thereby (including, without limitation, the reservation for issuance and
issuance of the Purchase Shares) will not (i) result in a violation of the
Certificate of Incorporation, if applicable, any Certificate of Designations,
Preferences and Rights of any outstanding series of preferred stock of the
Company or the By-laws or (ii) conflict with, or constitute a default (or an
event which with notice or lapse of time or both would become a default) under,
or give to others any rights of termination, amendment, acceleration or
cancellation of, any agreement, indenture or instrument to which the Company or
any of its Subsidiaries is a party, or result in a violation of any law, rule,
regulation, order, judgment or decree (including federal and state securities
laws and regulations and the rules and regulations of the Principal Market
applicable to the Company or any of its Subsidiaries) or by which any property
or asset of the Company or any of its Subsidiaries is bound or affected, except
in the case of conflicts, defaults, terminations, amendments, accelerations,
cancellations and violations under clause (ii), which could not reasonably be
expected to result in a Material Adverse Effect.  Except as disclosed
in Schedule 3(e), neither the Company nor its Subsidiaries is in violation of
any term of or in default under its Certificate of Incorporation, if applicable,
any Certificate of Designation, Preferences and Rights of any outstanding series
of preferred stock of the Company or By-laws or their organizational charter or
by-laws, respectively.  Except as disclosed in Schedule 3(e), neither
the Company nor any of its Subsidiaries is in violation of any term of or is in
default under any material contract, agreement, mortgage, indebtedness,
indenture, instrument, judgment, decree or order or any statute, rule or
regulation applicable to the Company or its Subsidiaries, except for possible
conflicts, defaults, terminations or amendments which could not reasonably be
expected to have a Material Adverse Effect.  The business of the
Company and its Subsidiaries is not being conducted, and shall not be conducted,
in violation of any law, ordinance, regulation of any governmental entity,
except for possible violations, the sanctions for which either individually or
in the aggregate could not reasonably be expected to have a Material Adverse
Effect.  Except as specifically contemplated by this Agreement and as
required under the 1933 Act or applicable state securities laws, the Company is
not required to obtain any consent, authorization or order of, or make any
filing or registration with, any court or governmental agency or any regulatory
or self-regulatory agency in order for it to execute, deliver or perform any of
its obligations under or contemplated by the Transaction Documents in accordance
with the terms hereof or thereof.  Except as disclosed in Schedule
3(e), all consents, authorizations, orders, filings and registrations which the
Company is required to obtain pursuant to the preceding sentence shall be
obtained or effected on or prior to the Commencement Date.  Except as
listed in Schedule 3(e), since January 1, 2007, the Company has not received nor
delivered any notices or correspondence from or to the Principal
Market.  The Principal Market has not commenced any delisting
proceedings against the Company.

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      (f)           SEC Documents; Financial
Statements. Except as disclosed in Schedule 3(f), since January 1, 2007,
the Company has timely filed all reports, schedules, forms, statements and other
documents required to be filed by it with the SEC pursuant to the reporting
requirements of the 1934 Act (all of the foregoing filed prior to the date
hereof and all exhibits included therein and financial statements and schedules
thereto and documents incorporated by reference therein being hereinafter
referred to as the "SEC Documents").  As of their respective dates
(except as they have been correctly amended), the SEC Documents complied in all
material respects with the requirements of the 1934 Act and the rules and
regulations of the SEC promulgated thereunder applicable to the SEC Documents,
and none of the SEC Documents, at the time they were filed with the SEC (except
as they may have been properly amended), contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.  As of their
respective dates (except as they have been properly amended), the financial
statements of the Company included in the SEC Documents complied as to form in
all material respects with applicable accounting requirements and the published
rules and regulations of the SEC with respect thereto.  Such financial
statements have been prepared in accordance with generally accepted accounting
principles, consistently applied, during the periods involved (except (i) as may
be otherwise indicated in such financial statements or the notes thereto or (ii)
in the case of unaudited interim statements, to the extent they may exclude
footnotes or may be condensed or summary statements) and fairly present in all
material respects the financial position of the Company as of the dates thereof
and the results of its operations and cash flows for the periods then ended
(subject, in the case of unaudited statements, to normal year-end audit
adjustments).  Except as listed in Schedule 3(f), the Company has
received no notices or correspondence from the SEC since January 1, 2007.  The SEC has not
commenced any enforcement proceedings against the Company or any of its
subsidiaries.

      

      (g)           Absence of Certain
Changes.  Except as disclosed in Schedule 3(g), since September
30, 2007, there has been no material adverse change in the business, properties,
operations, financial condition or results of operations of the Company or its
Subsidiaries.  The Company has not taken any steps, and does not
currently expect to take any steps, to seek protection pursuant to any
Bankruptcy Law nor does the Company or any of its Subsidiaries have any
knowledge or reason to believe that its creditors intend to initiate involuntary
bankruptcy or
insolvency proceedings.

      

      (h)           Absence of
Litigation. There is no action, suit, proceeding, inquiry or
investigation before or by any court, public board, government agency,
self-regulatory organization or body pending or, to the knowledge of the Company
or any of its Subsidiaries, threatened against or affecting the Company, the
Common Stock or any of the Company's Subsidiaries or any of the Company's or the
Company's Subsidiaries' officers or directors in their capacities as such, which
could reasonably be expected to have a Material Adverse
Effect.   A description of each action, suit, proceeding, inquiry
or investigation before or by any court, public board, government agency,
self-regulatory organization or body which, as of the date of this Agreement, is
pending or threatened in writing against or affecting the Company, the Common
Stock or any of the Company's Subsidiaries or any of the Company's or the
Company's Subsidiaries' officers or directors in their capacities as such, is
set forth in Schedule 3(h).

      

      (i)           Acknowledgment Regarding
Buyer's Status.  The Company acknowledges and agrees that the
Buyer is acting solely in the capacity of arm's length purchaser with respect to
the Transaction Documents and the transactions contemplated hereby and
thereby.  The Company further acknowledges that the Buyer is not
acting as a financial advisor or fiduciary of the Company (or in any similar
capacity) with respect to the Transaction Documents and the transactions
contemplated hereby and thereby and any advice given by the Buyer or any of its
representatives or agents in connection with the Transaction Documents and the
transactions contemplated hereby and thereby is merely incidental to the Buyer's
purchase of the Securities.  The Company further represents to the
Buyer that the Company's decision to enter into the Transaction Documents has
been based solely on the independent evaluation by the Company and its
representatives and advisors.

      

      (j)           No General
Solicitation.  Neither the Company, nor any of its affiliates,
nor any person acting on its or their behalf, has engaged in any form of general
solicitation or general advertising (within the meaning of Regulation D under
the 1933 Act) in connection with the offer or sale of the
Securities.

      

       (k)           Intellectual Property
Rights.  The Company and its Subsidiaries own or possess
adequate rights or licenses to use all material trademarks, trade names, service
marks, service mark registrations, service names, patents, patent rights,
copyrights, inventions, licenses, approvals, governmental authorizations, trade
secrets and rights necessary to conduct their respective businesses as now
conducted.  Except as set forth on Schedule 3(k), none of the
Company's material trademarks, trade names, service marks, service mark
registrations, service names, patents, patent rights, copyrights, inventions,
licenses, approvals, government authorizations, trade secrets or other
intellectual property rights have expired or terminated, or, by the terms and
conditions thereof, could expire or terminate within two years from the date of
this Agreement.  The Company and its Subsidiaries do not have any
knowledge of any infringement by the Company or its Subsidiaries of any material
trademark, trade name rights, patents, patent rights, copyrights, inventions,
licenses, service names, service marks, service mark registrations, trade secret
or other similar rights of others, or of any such development of similar or
identical trade secrets or technical information by others and, except as set
forth on Schedule 3(k), there is no claim, action or proceeding being made or
brought against, or to the Company's knowledge, being threatened against, the
Company or its Subsidiaries regarding trademark, trade name, patents, patent
rights, invention, copyright, license, service names, service marks, service
mark registrations, trade secret or other infringement, which could reasonably
be expected to have a Material Adverse Effect.

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      (l)           Environmental
Laws.  The Company and its Subsidiaries (i) are in compliance
with any and all applicable foreign, federal, state and local laws and
regulations relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants (“Environmental Laws”), (ii) have received all permits, licenses or
other approvals required of them under applicable Environmental Laws to conduct
their respective businesses and (iii) are in compliance with all terms and
conditions of any such permit, license or approval, except where, in each of the
three foregoing clauses, the failure to so comply could not reasonably be
expected to have, individually or in the aggregate, a Material Adverse
Effect.

      

      (m)           Title.  The
Company and its Subsidiaries have good and marketable title in fee simple to all
real property and good and marketable title to all personal property owned by
them which is material to the business of the Company and its Subsidiaries, in
each case free and clear of all liens, encumbrances and defects except such as
are described in Schedule 3(m) or such as do not materially affect the value of
such property and do not interfere with the use made and proposed to be made of
such property by the Company and any of its Subsidiaries.  Any real
property and facilities held under lease by the Company and any of its
Subsidiaries are held by them under valid, subsisting and enforceable leases
with such exceptions as are not material and do not interfere with the use made
and proposed to be made of such property and buildings by the Company and its
Subsidiaries.

      

      (n)           Insurance.  The
Company and each of its Subsidiaries are insured by insurers of recognized
financial responsibility against such losses and risks and in such amounts as
management of the Company believes to be prudent and customary in the businesses
in which the Company and its Subsidiaries are engaged.  Neither the
Company nor any such Subsidiary has been refused any insurance coverage sought
or applied for and neither the Company nor any such Subsidiary has any reason to
believe that it will not be able to renew its existing insurance coverage as and
when such coverage expires or to obtain similar coverage from similar insurers
as may be necessary to continue its business at a cost that would not materially
and adversely affect the condition, financial or otherwise, or the earnings,
business or operations of the Company and its Subsidiaries, taken as a
whole.

      

      (o)           Regulatory
Permits.  The Company and its Subsidiaries possess all material
certificates, authorizations and permits issued by the appropriate federal,
state or foreign regulatory authorities necessary to conduct their respective
businesses, and neither the Company nor any such Subsidiary has received any
notice of proceedings relating to the revocation or modification of any such
certificate, authorization or permit.

      

      (p)           Tax
Status.  The Company and each of its Subsidiaries has made or
filed all federal and state income and all other material tax returns, reports
and declarations required by any jurisdiction to which it is subject (unless and
only to the extent that the Company and each of its Subsidiaries has set aside
on its books provisions reasonably adequate for the payment of all unpaid and
unreported taxes) and has paid all taxes and other governmental assessments and
charges that are material in amount, shown or determined to be due on such
returns, reports and declarations, except those being contested in good faith
and has set aside on its books provision reasonably adequate for the payment of
all taxes for periods subsequent to the periods to which such returns, reports
or declarations apply.  There are no unpaid taxes in any material
amount claimed to be due by the taxing authority of any jurisdiction, and the
officers of the Company know of no basis for any such claim.

      

      (q)           Transactions With
Affiliates.  Except as set forth on Schedule 3(q) and other
than the grant or exercise of stock options disclosed on Schedule 3(c), none of
the officers, directors, or employees of the Company is presently a party to any
transaction with the Company or any of its Subsidiaries (other than for services
as employees, officers and directors), including any contract, agreement or
other arrangement providing for the furnishing of services to or by, providing
for rental of real or personal property to or from, or otherwise requiring
payments to or from any officer, director or such employee or, to the knowledge
of the Company, any corporation, partnership, trust or other entity in which any
officer, director, or any such employee has an interest or is an officer,
director, trustee or partner.

      

      (r)           Application of Takeover
Protections.  The Company and its board of directors have taken
or will take prior to the Commencement Date all necessary action, if any, in
order to render inapplicable, so long as the Buyer’s actual ownership of Common
Stock is less than 15% of the total outstanding shares of Common Stock at all
times, any control share acquisition, business combination, poison pill
(including any distribution under a rights agreement) or other similar
anti-takeover provision under the Certificate of Incorporation or the laws of
the state of its incorporation which is or could become applicable to the Buyer
as a result of the transactions contemplated by this Agreement, including,
without limitation, the Company's issuance of the Securities and the Buyer's
ownership of the Securities.

      

      (s)           Foreign Corrupt
Practices.  Neither the Company, nor any of its Subsidiaries,
nor any director, officer, agent, employee or other person acting on behalf of
the Company or any of its Subsidiaries has, in the course of its actions for, or
on behalf of, the Company, used any corporate funds for any unlawful
contribution, gift, entertainment or other unlawful expenses relating to
political activity; made any direct or indirect unlawful payment to any foreign
or domestic government official or employee from corporate funds; violated or is
in violation of any provision of the U.S. Foreign Corrupt Practices Act of 1977,
as amended; or made any unlawful bribe, rebate, payoff, influence payment,
kickback or other unlawful payment to any foreign or domestic government
official or employee.

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      4.           COVENANTS.

      

      (a)           Filing of Form 8-K and
Registration Statement.  Subject to the Buyer’s prior approval,
the Company agrees that it shall, within the time required under the 1934 Act
file a Report on Form 8-K disclosing this Agreement and the transaction
contemplated hereby.  The Company shall also file within forty-five
(45) days (the “Filing Date”) from the date hereof a new registration statement
covering  the sale of the 4,052,778 Initial Shares, 1,275,000
Additional Commitment Shares and an additional 20,000,000 Purchase Shares in
accordance with the terms of the Registration Rights Agreement between the
Company and the Buyer, dated as of the date hereof (“Registration Rights
Agreement”).

      

      (b)           Blue Sky. The Company
shall take such action, if any, as is reasonably necessary in order to obtain an
exemption for or to qualify (i) the sales of any Purchase Shares or the Warrant
to the Buyer under this Agreement and (ii) any subsequent sales of any Purchase
Shares or Warrant Shares by the Buyer, in each case, under applicable securities
or "Blue Sky" laws of the states of the United States in such states as is
reasonably requested by the Buyer from time to time, and shall provide evidence
of any such action so taken to the Buyer.

      

      (c)           Listing.  The
Company shall promptly secure the listing of all of the Purchase Shares and the
Warrant Shares upon each national securities exchange and automated quotation
system, if any, upon which shares of Common Stock are then listed (subject to
official notice of issuance) and shall maintain, so long as any other shares of
Common Stock shall be so listed, such listing of all such securities from time
to time issuable under the terms of the Transaction Documents.  The
Company shall maintain the Common Stock's authorization for quotation on the
Principal Market.  Neither the Company nor any of its Subsidiaries
shall take any action that would be reasonably expected to result in the
delisting or suspension of the Common Stock on the Principal
Market.  The Company shall promptly, and in no event later than the
following Business Day, provide to the Buyer copies of any notices it receives
from the Principal Market regarding the continued eligibility of the Common
Stock for listing on such automated quotation system or securities
exchange.  The Company shall pay all fees and expenses in connection
with satisfying its obligations under this Section.

      

      (d)           Limitation on Short Sales
and Hedging Transactions.  The Buyer agrees that beginning on
the date of this Agreement and ending on the date of termination of this
Agreement as provided in Section 11(k), the Buyer and its agents,
representatives and affiliates shall not in any manner whatsoever enter into or
effect, directly or indirectly, any (i) "short sale" (as such term is defined in
Section 242.200 of Regulation SHO of the 1934 Act) of the Common Stock or (ii)
hedging transaction, which establishes a net short position with respect to the
Common Stock.

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      (e)           Issuance of Commitment
Shares; Limitation on Sales of Commitment Shares.  Immediately
upon the execution of this Agreement, the Company shall issue to the Buyer as
consideration for the Buyer entering into this Agreement 1,275,000 shares of
Common Stock (the “Initial Commitment Shares").  In connection with
each purchase of Purchase Shares hereunder, the Company agrees to issue to the
Buyer a number of shares of Common Stock (the “Additional Commitment Shares” and
together with the Initial Commitment Shares, the “Commitment Shares”) equal to
the product of (x) 1,275,000 and (y) the Purchase Amount
Fraction.  The “Purchase Amount Fraction” shall mean a fraction, the
numerator of which is the Purchase Amount purchased by the Buyer with respect to
such purchase of Purchase Shares and the denominator of which is Eight Million
Five Hundred Thousand Dollars ($8,500,000).  The Additional Commitment
Shares shall be equitably adjusted for any reorganization, recapitalization,
non-cash dividend, stock split or other similar transaction. The Initial
Commitment Shares and the Initial Purchase Shares (referred to herein as the
“Initial Shares”) shall be issued in certificated form and (subject to Section 5
hereof) shall bear only the following restrictive legend:

      

      THE
SECURITIES REPRESENTED BY THIS CERTIFICATE 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, UNLESS SOLD PURSUANT TO: (1) RULE 144 UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR (2) AN OPINION OF HOLDER’S COUNSEL,
IN A CUSTOMARY FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR
APPLICABLE STATE SECURITIES LAWS.

      

        The
Buyer agrees that the Buyer shall not pledge, transfer or sell the Commitment
Shares until the earlier of (a) 500 Business Days (25 Monthly Periods) from the
date hereof or (b) the date on which this Agreement has been terminated,
provided, however, that such restrictions shall not apply: (i) in connection
with any transfers to or among affiliates (as defined in the 1934 Act), (ii) in
the event that the Commencement does not occur on or before June 1, 2008, due to
the failure of the Company to satisfy the conditions set forth in Section 7 or
(iii) if an Event of Default has occurred, or any event which, after notice
and/or lapse of time, would become an Event of Default, including any failure by
the Company to timely issue Purchase Shares under this
Agreement.  Notwithstanding the forgoing, the Buyer may transfer
Commitment Shares to a third party in order to settle a sale made by the Buyer
where the Buyer reasonably expects the Company to deliver additional Purchase
Shares to the Buyer under this Agreement so long as the Buyer maintains
ownership of at least 1,275,000 shares overall by "replacing" such Commitment
Shares so transferred with new Purchase Shares when the new Purchase Shares are
actually issued by the Company to the Buyer.

      

      (f)           Due
Diligence.  The Buyer shall have the right, from time to time
as the Buyer may reasonably deem appropriate, to perform reasonable due
diligence on the Company during normal business hours.  The Company
and its officers and employees shall provide information and reasonably
cooperate with the Buyer in connection with any reasonable request by the Buyer
related to the Buyer's due diligence of the Company, including, but not limited
to, any such request made by the Buyer in connection with (i) the filing of the
registration statement described in Section 4(a) hereof and (ii) the
Commencement.  Each party hereto agrees not to disclose any
Confidential Information of the other party to any third party and shall not use
the Confidential Information for any purpose other than in connection with, or
in furtherance of, the transactions contemplated hereby.  Each party
hereto acknowledges that the Confidential Information shall remain the property
of the disclosing party and agrees that it shall take all reasonable measures to
protect the secrecy of any Confidential Information disclosed by the other
party.

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      5.           TRANSFER
AGENT INSTRUCTIONS.

      

      Immediately
upon the execution of this Agreement, the Company shall deliver to the Transfer
Agent a letter in the form as set forth as Exhibit E attached
hereto with respect to the issuance of the 4,052,778 Initial Shares to be issued
to the Buyer upon execution hereof. On the Commencement
Date, the Company shall cause any restrictive legend on the 4,052,778 Initial
Shares to be removed and all of the remaining Purchase Shares to be issued under
this Agreement shall be issued without any restrictive legend unless the Buyer
expressly consents otherwise.  The Company shall issue irrevocable
instructions to the Transfer Agent, and any subsequent transfer agent, to issue
Purchase Shares in the name of the Buyer for the Purchase Shares (the
"Irrevocable Transfer Agent Instructions").  The Company warrants to
the Buyer that no instruction other than the Irrevocable Transfer Agent
Instructions expressly referred to in this Agreement will be given by the
Company to the Transfer Agent with respect to the Warrant Shares, the Commitment
Shares or the Purchase Shares (including the Initial Purchase Shares), and that
the Warrant Shares, the Commitment Shares and the Purchase Shares (including the
Initial Purchase Shares) shall otherwise be freely transferable on the books and
records of the Company as and to the extent provided in this Agreement and the
Registration Rights Agreement subject to the provisions of Section 4(e) in the
case of the Commitment Shares.

      

      

      
        	
                 
      

              	
                6.

              	
                CONDITIONS
      TO THE COMPANY'S RIGHT TO COMMENCE

              

      

      SALES
OF SHARES OF COMMON STOCK UNDER THIS AGREEMENT.

      

      The right
of the Company hereunder to commence sales of the Purchase Shares is subject to
the satisfaction of each of the following conditions on or before the
Commencement Date (the date that the Company may begin sales):

      

      (a)           The
Buyer shall have executed each of the Transaction Documents and delivered the
same to the Company;

      

      (b)           A
registration statement covering the sale of all of the Initial Shares and Purchase
Shares  shall have been declared effective under the 1933 Act by the
SEC and no stop order with respect to the registration statement shall be
pending or threatened by the SEC.

      

      

      
        	
                 
      

              	
                7.

              	
                CONDITIONS
      TO THE BUYER'S OBLIGATION TO MAKE

              

      

      PURCHASES
OF SHARES OF COMMON STOCK.

      

      The
obligation of the Buyer to buy Purchase Shares (other than the Initial Purchase
Shares) under this Agreement is subject to the satisfaction of each of the
following conditions on or before the Commencement Date (the date that the
Company may begin sales other than the Initial Purchase Shares) and once such
conditions have been initially satisfied, there shall not be any ongoing
obligation to satisfy such conditions after the Commencement has
occurred:

      

      (a)           The
Company shall have executed each of the Transaction Documents and delivered the
same to the Buyer;

      

      (b)           The
Company shall have issued to the Buyer the Initial Shares and shall have removed
the restrictive transfer legend from the certificate representing all the
Initial Shares;

      

      (c)           The
Common Stock shall be authorized for quotation on the Principal Market, trading
in the Common Stock shall not have been within the last 365 days suspended by
the SEC or the Principal Market and the Purchase Shares and the Warrant Shares
shall be approved for listing upon the Principal Market, if
applicable;

      

      (d)           The
Buyer shall have received the opinions of the Company's legal counsel dated as
of the Commencement Date substantially in the form of Exhibit
A attached hereto;

      

      (e)           The
representations and warranties of the Company shall be true and correct in all
material respects (except to the extent that any of such representations and
warranties is already qualified as to materiality in Section 3 above, in which
case, such representations and warranties shall be true and correct without
further qualification) as of the date when made and as of the Commencement Date
as though made at that time (except for representations and warranties that
speak as of a specific date) and the Company shall have performed, satisfied and
complied with the covenants, agreements and conditions required by the
Transaction Documents to be performed, satisfied or complied with by the Company
at or prior to the Commencement Date.  The Buyer shall have received a
certificate, executed by the CEO, President or CFO of the Company, dated as of
the Commencement Date, to the foregoing effect in the form attached hereto as
Exhibit
B;

      

      (f)           The
Board of Directors of the Company shall have adopted resolutions in the form
attached hereto as Exhibit
C which shall be in full force and effect without any amendment or
supplement thereto as of the Commencement Date;

      

      (g)           As
of the Commencement Date, the Company shall have reserved out of its authorized
and unissued Common Stock, (A) solely for the purpose of effecting future
purchases of Purchase Shares hereunder, 25,000,000 shares of Common Stock not
including the Initial Purchase Shares and (B) as Additional Commitment Shares in
accordance with Section 4(e) hereof, 1,275,000 shares of Common
Stock

      

      (h)           The
Irrevocable Transfer Agent Instructions, in form acceptable to the Buyer shall
have been delivered to and acknowledged in writing by the Company and the
Company's Transfer Agent;

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      (i)           The
Company shall have delivered to the Buyer a certificate evidencing the
incorporation and good standing of the Company in the State of Delaware issued
by the Secretary of State of the State of Delaware as of a date within ten (10)
Business Days of the Commencement Date and the Company shall have delivered to
the Buyer a certificate evidencing good standing of the Company in the State of
New Jersey issued by the Secretary of State of the State of New Jersey as of a
date within ten (10) Business Days of the Commencement Date;

      

      (j)           The
Company shall have delivered to the Buyer a certified copy of the Certificate of
Incorporation as certified by the Secretary of State of the State of Delaware
within ten (10) Business Days of the Commencement Date;

      

      (k)           The
Company shall have delivered to the Buyer a secretary's certificate executed by
the Secretary of the Company, dated as of the Commencement Date, in the form
attached hereto as Exhibit
D;

      

      (l)           A
registration statement covering the sale of all of the Initial Shares and
Purchase Shares shall have been declared effective under the 1933 Act by the SEC
and no stop order with respect to the registration statement shall be pending or
threatened by the SEC.  The Company shall have prepared and delivered
to the Buyer a final and complete form of prospectus, dated and current as of
the Commencement Date, to be used by the Buyer in connection with any sales of
any Commitment Shares or any Purchase Shares, and to be filed by the Company one
Business Day after the Commencement Date. The Company shall have made all
filings under all applicable federal and state securities laws necessary to
consummate the issuance of the Warrant, the Commitment Shares and the Purchase
Shares pursuant to this Agreement in compliance with such laws;

      

      (m)           No
Event of Default has occurred, or any event which, after notice and/or lapse of
time, would become an Event of Default has occurred;

      

      (n)           On
or prior to the Commencement Date, the Company shall take all necessary action,
if any, and such actions as reasonably requested by the Buyer, in order to
render inapplicable, so long as the Buyer’s actual ownership of Common Stock is
less than 15% of the total outstanding shares of Common Stock at all times, any
control share acquisition, business combination, shareholder rights plan or
poison pill (including any distribution under a rights agreement) or other
similar anti-takeover provision under the Certificate of Incorporation or the
laws of the state of its incorporation which is or could become applicable to
the Buyer as a result of the transactions contemplated by this Agreement,
including, without limitation, the Company's issuance of the Securities and the
Buyer's ownership of the Securities; and

      

      (o)           The
Company shall have provided the Buyer with the information requested by the
Buyer in connection with its due diligence requests made prior to, or in
connection with, the Commencement, in accordance with the terms of Section 4(g)
hereof.

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        	
                 
      

              	
                8.

              	
                INDEMNIFICATION.

              

      

      

      In
consideration of the Buyer's execution and delivery of the Transaction Documents
and acquiring the Securities hereunder and in addition to all of the Company's
other obligations under the Transaction Documents, the Company shall defend,
protect, indemnify and hold harmless the Buyer and all of its affiliates,
shareholders, officers, directors, employees and direct or indirect investors
and any of the foregoing person's agents or other representatives (including,
without limitation, those retained in connection with the transactions
contemplated by this Agreement) (collectively, the "Indemnitees") from and
against any and all actions, causes of action, suits, claims, losses, costs,
penalties, fees, liabilities and damages, and expenses in connection therewith
(irrespective of whether any such Indemnitee is a party to the action for which
indemnification hereunder is sought), and including reasonable attorneys' fees
and disbursements (the "Indemnified Liabilities"), incurred by any Indemnitee as
a result of, or arising out of, or relating to (a) any misrepresentation or
breach of any representation or warranty made by the Company in the Transaction
Documents or any other certificate, instrument or document contemplated hereby
or thereby, (b) any breach of any covenant, agreement or obligation of the
Company contained in the Transaction Documents or any other certificate,
instrument or document contemplated hereby or thereby, or (c) any cause of
action, suit or claim brought or made against such Indemnitee and arising out of
or resulting from the execution, delivery, performance or enforcement of the
Transaction Documents or any other certificate, instrument
or  document contemplated hereby or thereby, other than with respect
to Indemnified Liabilities which directly and primarily result from the gross
negligence or willful misconduct of the Indemnitee.  To the extent
that the foregoing undertaking by the Company may be unenforceable for any
reason, the Company shall make the maximum contribution to the payment and
satisfaction of each of the Indemnified Liabilities which is permissible under
applicable law.

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      9.           EVENTS
OF DEFAULT.

      

      An "Event
of Default" shall be deemed to have occurred at any time as any of the following
events occurs:

      

      (a)           while
any registration statement is required to be maintained effective pursuant to
the terms of the Registration Rights Agreement, the effectiveness of such
registration statement lapses for any reason (including, without limitation, the
issuance of a stop order) or is unavailable to the Buyer for sale of all of the
Registrable Securities (as defined in the Registration Rights Agreement) in
accordance with the terms of the Registration Rights Agreement, and such lapse
or unavailability continues for a period of ten (10) consecutive Business Days
or for more than an aggregate of thirty (30) Business Days in any 365-day
period;

      

      (b)           the
suspension from trading or failure of the Common Stock to be listed on the
Principal Market for a period of three (3) consecutive Business
Days;

      

      (c)           the
delisting of the Company’s Common Stock from the Principal Market, provided,
however, that the Common Stock is not immediately thereafter trading on the New
York Stock Exchange, the Nasdaq Global Market, the Nasdaq Capital Market, or the
American Stock Exchange;

      

      (d)           the
failure for any reason by the Transfer Agent to issue Purchase Shares to the
Buyer within five (5) Business Days after the applicable Purchase Date which the
Buyer is entitled to receive;

      

      (e)           the
Company breaches any representation, warranty, covenant or other term or
condition under any Transaction Document if such breach could have a Material
Adverse Effect and except, in the case of a breach of a covenant which is
reasonably curable, only if such breach continues for a period of at least five
(5) Business Days;

      

      (f)           if
any Person commences a proceeding against the Company pursuant to or within the
meaning of any Bankruptcy Law;

      

      (g)           if
the Company pursuant to or within the meaning of any Bankruptcy Law; (A)
commences a voluntary case, (B) consents to the entry of an order for relief
against it in an involuntary case, (C) consents to the appointment of a
Custodian of it or for all or substantially all of its property, (D) makes a
general assignment for the benefit of its creditors, (E) becomes insolvent, or
(F) is generally unable to pay its debts as the same become due;

      

      (h)           a
court of competent jurisdiction enters an order or decree under any Bankruptcy
Law that (A) is for relief against the Company in an involuntary case, (B)
appoints a Custodian of the Company or for all or substantially all of its
property, or (C) orders the liquidation of the Company or any Subsidiary;
or

      

      (i)           a
material adverse change in the business, properties, operations, financial
condition or results of operations of the Company and its Subsidiaries taken as
a whole.

      

      In
addition to any other rights and remedies under applicable law and this
Agreement, including the Buyer termination rights under Section 11(k) hereof, so
long as an Event of Default has occurred and is continuing, or if any event
which, after notice and/or lapse of time, would become an Event of Default, has
occurred and is continuing, or so long as the Purchase Price is below the
Purchase Price Floor, the Buyer shall not be obligated to purchase any shares of
Common Stock under this Agreement.  If pursuant to or within the
meaning of any Bankruptcy Law, the Company commences a voluntary case or any
Person commences a proceeding against the Company, a Custodian is appointed for
the Company or for all or substantially all of its property, or the Company
makes a general assignment for the benefit of its creditors, (any of which would
be an Event of Default as described in Sections 9(f), 9(g) and 9(h) hereof) this Agreement
shall automatically terminate without any liability or payment to the Company
without further action or notice by any Person.  No such termination
of this Agreement under Section 11(k)(i) shall affect the Company's or the
Buyer's obligations under this Agreement with respect to pending purchases and
the Company and the Buyer shall complete their respective obligations with
respect to any pending purchases under this Agreement.

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      10.           CERTAIN
DEFINED TERMS.

      

      For
purposes of this Agreement, the following terms shall have the following
meanings:

      

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

      

      (b)           “Available
Amount” means initially Eight Million Five Hundred Thousand ($8,500,000) in the
aggregate which amount shall be reduced by the Purchase Amount each time the
Buyer purchases shares of Common Stock pursuant to Section 1 hereof including
the Initial Purchase.

      

      (c)           “Bankruptcy
Law” means Title 11, U.S. Code, or any similar federal or state law for the
relief of debtors.

      

      (d)           “Base
Purchase Notice” shall mean an irrevocable written notice from the Company to
the Buyer directing the Buyer to buy up to the Base Purchase Amount in Purchase
Shares as specified by the Company therein at the applicable Purchase Price on
the Purchase Date.

      

      (e)           “Block
Purchase Amount” shall mean such Block Purchase Amount as specified by the
Company in a Block Purchase Notice subject to Section 1(b) hereof.

      

      (f)           “Block
Purchase Notice” shall mean an irrevocable written notice from the Company to
the Buyer directing the Buyer to buy the Block Purchase Amount in Purchase
Shares as specified by the Company therein at the Block Purchase Price as of the
Purchase Date subject to Section 1 hereof.

      

      (d)           “Business
Day” means any day on which the Principal Market is open for trading including
any day on which the Principal Market is open for trading for a period of time
less than the customary time.

      

      (e)           “Closing
Sale Price” means, for any security as of any date, the last closing trade price
for such security on the Principal Market as reported by the Principal Market,
or, if the Principal Market is not the principal securities exchange or trading
market for such security, the last closing trade price of such security on the
principal securities exchange or trading market where such security is listed or
traded as reported by  the Principal Market.

      

      (f)           “Confidential
Information” means any information disclosed by either party to the other party,
either directly or indirectly, in writing, orally or by inspection of tangible
objects (including, without limitation, documents, prototypes, samples, plant
and equipment), which is designated as "Confidential," "Proprietary" or some
similar designation. Information communicated orally shall be considered
Confidential Information if such information is confirmed in writing as being
Confidential Information within ten (10) business days after the initial
disclosure. Confidential Information may also include information disclosed to a
disclosing party by third parties. Confidential Information shall not, however,
include any information which (i) was publicly known and made generally
available in the public domain prior to the time of disclosure by the disclosing
party; (ii) becomes publicly known and made generally available after disclosure
by the disclosing party to the receiving party through no action or inaction of
the receiving party; (iii) is already in the possession of the receiving party
at the time of disclosure by the disclosing party as shown by the receiving
party’s files and records immediately prior to the time of disclosure; (iv) is
obtained by the receiving party from a third party without a breach of such
third party’s obligations of confidentiality; (v) is independently developed by
the receiving party without use of or reference to the disclosing party’s
Confidential Information, as shown by documents and other competent evidence in
the receiving party’s possession; or (vi) is required by law to be disclosed by
the receiving party, provided that the receiving party gives the disclosing
party prompt written notice of such requirement prior to such disclosure and
assistance in obtaining an order protecting the information from public
disclosure.

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      (g)           “Custodian”
means any receiver, trustee, assignee, liquidator or similar official under any
Bankruptcy Law.

      

      (h)           “Maturity
Date” means the date that is 500 Business Days (25 Monthly Periods) from the
Commencement Date.

      

      (i)           “Monthly
Period” means each successive 20 Business Day period commencing with the
Commencement Date.

      

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

      

      (k)           “Principal
Market” means the Nasdaq OTC Bulletin Board; provided however, that in the event
the Company’s Common Stock is ever listed or traded on the Nasdaq Global Market,
the Nasdaq Capital Market, the New York Stock Exchange or the American Stock
Exchange, then the “Principal Market” shall mean such other market or exchange
on which the Company’s Common Stock is then listed or traded.

      

      (l)           “Purchase
Amount” means, with respect to any particular purchase made hereunder, the
portion of the Available Amount to be purchased by the Buyer pursuant to Section
1 hereof in connection with the Initial Purchases or as set forth in a valid
Base Purchase Notice or a valid Block Purchase Notice which the Company delivers
to the Buyer.

      

      (m)           “Purchase
Date” means with respect to any particular purchase made hereunder, the Business
Day after receipt by the Buyer of a valid Base Purchase Notice or a valid Block
Purchase Notice that the Buyer is to buy Purchase Shares pursuant to Section 1
hereof.

      

      (n)           
“Purchase Price” means the lower of the (A) the lowest Sale Price of the Common
Stock on the Purchase Date and (B) the arithmetic average of the three (3)
lowest Closing Sale Prices for the Common Stock during the twelve (12)
consecutive Business Days ending on the Business Day immediately preceding such
Purchase Date (to be appropriately adjusted for any reorganization,
recapitalization, non-cash dividend, stock split or other similar
transaction).

      

      (o)           “Sale
Price” means, any trade price for the shares of Common Stock on the Principal
Market as reported by the Principal Market.

      

      (q)           “SEC”
means the United States Securities and Exchange Commission.

      

      (r)           “Transfer
Agent” means the transfer agent of the Company as set forth in Section 11(f)
hereof or such other person who is then serving as the transfer agent for the
Company in respect of the Common Stock.

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      

      11.           MISCELLANEOUS.

      

      (a)           Governing Law; Jurisdiction;
Jury Trial.  The corporate laws of the State of Delaware shall
govern all issues concerning the relative rights of the Company and its
shareholders. All other questions concerning the construction, validity,
enforcement and interpretation of this Agreement and the other Transaction
Documents shall be governed by the internal laws of the State of Illinois,
without giving effect to any choice of law or conflict of law provision or rule
(whether of the State of Illinois or any other jurisdictions) that would cause
the application of the laws of any jurisdictions other than the State of
Illinois.  Each party hereby irrevocably submits to the exclusive
jurisdiction of the state and federal courts sitting in the City of Chicago, for
the adjudication of any dispute hereunder or under the other Transaction
Documents 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.  EACH PARTY HEREBY IRREVOCABLY WAIVES
ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE
ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT
OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

      

      (b)           Counterparts.  This
Agreement may be executed in two or more identical counterparts, all of which
shall be considered one and the same agreement and shall become effective when
counterparts have been signed by each party and delivered to the other party;
provided that a facsimile signature shall be considered due execution and shall
be binding upon the signatory thereto with the same force and effect as if the
signature were an original, not a facsimile signature.

      

      (c)           Headings.  The
headings of this Agreement are for convenience of reference and shall not form
part of, or affect the interpretation of, this Agreement.

      

      (d)           Severability.  If
any provision of this Agreement shall be invalid or unenforceable in any
jurisdiction, such invalidity or unenforceability shall not affect the validity
or enforceability of the remainder of this Agreement in that jurisdiction or the
validity or enforceability of any provision of this Agreement in any other
jurisdiction.

      

      (e)           Entire
Agreement.  With the exception of the Mutual Nondisclosure
Agreement between the parties, this Agreement supersedes all other prior oral or
written agreements between the Buyer, the Company, their affiliates and persons
acting on their behalf with respect to the matters discussed herein, and this
Agreement, the other Transaction Documents and the instruments referenced herein
contain the entire understanding of the parties with respect to the matters
covered herein and therein and, except as specifically set forth herein or
therein, neither the Company nor the Buyer makes any representation, warranty,
covenant or undertaking with respect to such matters.  The Company
acknowledges and agrees that is has not relied on, in any manner whatsoever, any
representations or statements, written or oral, other than as expressly set
forth in this Agreement.

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      (f)           Notices.  Any
notices, consents or other communications required or permitted to be given
under the terms of this Agreement 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
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 the Company:

      DOR BioPharma, Inc.

      850 Bear Tavern Road, Suite
201

      Ewing, New Jersey 08628

      Telephone:      609-538-8200

      Facsimile:                
609-538-8205

      Attention:               
Chief Executive Officer

      

      With a
copy to:

      Edwards Angell Palmer & Dodge
LLP

      350 E. Las Olas Boulevard, Suite
1150

      Fort Lauderdale,  FL
33301

      Telephone:                 954-727-2600

      Facsimile:                    954-727-2601

      Attention:                   Leslie
J. Croland

      

      If to the
Buyer:

      Fusion
Capital Fund II, LLC

      222
Merchandise Mart Plaza, Suite 9-112

      Chicago,
IL 60654

      Telephone:                312-644-6644

      Facsimile:                   312-644-6244

      Attention:                  Steven
G. Martin

      

      If to the
Transfer Agent:

          American Stock
Transfer & Trust Co.

          6201 15th Avenue,
2nd
Floor

          Brooklyn,
NY  11219

      Telephone:                   718-921-8247

      Facsimile:                      718-921-8323

      Attention:                      Angelia
Brown

      

      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 (A) given by the recipient of
such notice, consent or other communication, (B) mechanically or electronically
generated by the sender's facsimile machine containing the time, date, and
recipient facsimile number or (C) 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.

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      (g)           Successors and
Assigns.  This Agreement shall be binding upon and inure to the
benefit of the parties and their respective successors and
assigns.  The Company shall not assign this Agreement or any rights or
obligations hereunder without the prior written consent of the Buyer, including
by merger or consolidation.  The Buyer may not assign its rights or
obligations under this Agreement.

      

      (h)           No Third Party
Beneficiaries.  This Agreement is intended for the benefit of
the parties hereto and their respective permitted successors and assigns, and is
not for the benefit of, nor may any provision hereof be enforced by, any other
person.

      

      (i)           Publicity.  The
Buyer shall have the right to approve before issuance any press release, SEC
filing or any other public disclosure made by or on behalf of the Company
whatsoever with respect to, in any manner, the Buyer, its purchases hereunder or
any aspect of this Agreement or the transactions contemplated hereby; provided,
however, that the Company shall be entitled, without the prior approval of the
Buyer, to make any press release or other public disclosure (including any
filings with the SEC) with respect to such transactions as is required by
applicable law and regulations so long as the Company and its counsel consult
with the Buyer in connection with any such press release or other public
disclosure at least two (2) Business Days prior to its release.  The
Buyer must be provided with a copy thereof at least two (2) Business Days prior
to any release or use by the Company thereof.  The Company agrees and
acknowledges that its failure to fully comply with this provision constitutes a
material adverse effect on its ability to perform its obligations under this
Agreement.

      

      (j)           Further
Assurances.  Each party shall do and perform, or cause to be
done and performed, all such further acts and things, and shall execute and
deliver all such other agreements, certificates, instruments and documents, as
the other party may reasonably request in order to carry out the intent and
accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.

      

      (k)           Termination.  This
Agreement may be terminated only as follows:

      

      (i)           By
the Buyer any time an Event of Default exists without any liability or payment
to the Company.  However, if pursuant to or within the meaning of any
Bankruptcy Law, the Company commences a voluntary case or any Person commences a
proceeding against the Company, a Custodian is appointed for the Company or for
all or substantially all of its property, or the Company makes a general
assignment for the benefit of its creditors, (any of which would be an Event of
Default as described in Sections 9(f), 9(g) and 9(h) hereof) this Agreement
shall automatically terminate without any liability or payment to the Company
without further action or notice by any Person.  No such termination
of this Agreement under this Section 11(k)(i) shall affect the Company's or the
Buyer's obligations under this Agreement with respect to pending purchases and
the Company and the Buyer shall complete their respective obligations with
respect to any pending purchases under this Agreement.

      

      (ii)           In
the event that the Commencement shall not have occurred, the Company shall have
the option to terminate this Agreement for any reason or for no reason without
any liability whatsoever of any party to any other party under this
Agreement.

      

      (iii)           In
the event that the Commencement shall not have occurred on or before June 1,
2008, due to the failure to satisfy the conditions set forth in Sections 6 and 7
above with respect to the Commencement, at any time prior to Commencement either
party shall have the option to terminate this Agreement at the close of business
on such date or thereafter without any liability whatsoever of any party to any
other party under this Agreement.

      

       (iv)           
At any time after the Commencement Date, the Company shall have the option to
terminate this Agreement for any reason or for no reason by delivering notice (a
“Company Termination Notice”) to the Buyer electing to terminate this Agreement
without any liability whatsoever of any party to any other party under this
Agreement.  The Company Termination Notice shall not be effective
until one (1) Business Day after it has been received by the Buyer.

      

      (v)           This
Agreement shall automatically terminate on the date that the Company sells and
the Buyer purchases the full Available Amount as provided herein, without any
action or notice on the part of any party and without any liability whatsoever
of any party to any other party under this Agreement.

      

      (vi)           If
by the Maturity Date for any reason or for no reason the full Available Amount
under this Agreement has not been purchased as provided for in Section 1 of this
Agreement, this Agreement shall automatically terminate on the Maturity Date,
without any action or notice on the part of any party and without any liability
whatsoever of any party to any other party under this Agreement.

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      Except as
set forth in Sections 11(k)(i) (in respect of an Event of Default under Sections
9(f), 9(g) and 9(h)) and 11(k)(vi), any termination of this Agreement pursuant
to this Section 11(k) shall be effected by written notice from the Company to
the Buyer, or the Buyer to the Company, as the case may be, setting forth the
basis for the termination hereof.  The representations and warranties
of the Company and the Buyer contained in Sections 2, 3 and 5 hereof, the
indemnification provisions set forth in Section 8 hereof and the agreements and
covenants set forth in Section 11, shall survive the
Commencement and any termination of this Agreement.  No termination of
this Agreement shall affect the Company's or the Buyer's rights or obligations
(i) under the Registration Rights Agreement which shall survive any such
termination or (ii) under this Agreement with respect to pending purchases and
the Company and the Buyer shall complete their respective obligations with
respect to any pending purchases under this Agreement.

      

      (l)           Financial Advisor, Placement
Agent, Broker or Finder.  The Company represents and warrants
to the Buyer that it has not engaged any financial advisor, placement agent,
broker or finder in connection with the transactions contemplated
hereby.  The Buyer represents and warrants to the Company that it has
not engaged any financial advisor, placement agent, broker or finder in
connection with the transactions contemplated hereby.  The Company
shall be responsible for the payment of any fees or commissions, if any, of any
financial advisor, placement agent, broker or finder relating to or arising out
of the transactions contemplated hereby.  The Company shall pay, and
hold the Buyer harmless against, any liability, loss or expense (including,
without limitation, attorneys' fees and out of pocket expenses) arising in
connection with any such claim.

      

      (m)           No Strict
Construction.  The language used in this Agreement will be
deemed to be the language chosen by the parties to express their mutual intent,
and no rules of strict construction will be applied against any
party.

      

      (n)           Remedies, Other Obligations,
Breaches and Injunctive Relief.  The Buyer’s remedies provided
in this Agreement shall be cumulative and in addition to all other remedies
available to the Buyer under this Agreement, at law or in equity (including a
decree of specific performance and/or other injunctive relief), no remedy of the
Buyer contained herein shall be deemed a waiver of compliance with the
provisions giving rise to such remedy and nothing herein shall limit the Buyer's
right to pursue actual damages for any failure by the Company to comply with the
terms of this Agreement.  The Company acknowledges that a breach by it
of its obligations hereunder will cause irreparable harm to the Buyer and that
the remedy at law for any such breach may be inadequate.  The Company
therefore agrees that, in the event of any such breach or threatened breach, the
Buyer shall be entitled, in addition to all other available remedies, to an
injunction restraining any breach, without the necessity of showing economic
loss and without any bond or other security being required.

      

      (o)           Enforcement
Costs.  If: (i) this Agreement is placed by the Buyer in the
hands of an attorney for enforcement or is enforced by the Buyer through any
legal proceeding; or (ii) an attorney is retained to represent the Buyer in any
bankruptcy, reorganization, receivership or other proceedings affecting
creditors' rights and involving a claim under this Agreement; or (iii) an
attorney is retained to represent the Buyer in any other proceedings whatsoever
in connection with this Agreement, then the Company shall pay to the Buyer, as
incurred by the Buyer, all reasonable costs and expenses including attorneys'
fees incurred in connection therewith, in addition to all other amounts due
hereunder.

      

      (p)           Failure or Indulgence Not
Waiver.  No failure or delay in the exercise of any power,
right or privilege hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise of any such power, right or privilege preclude other
or further exercise thereof or of any other right, power or
privilege.

      

      

      *     *     *     *     *

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      IN WITNESS WHEREOF, the Buyer
and the Company have caused this Common Stock Purchase Agreement to be duly
executed as of the date first written above.

      

      

      

      THE
COMPANY:

      

      DOR
BioPharma, Inc.

      

      

      By:  /s/ Christopher J.
Schaber_

      Name:   Christopher J.
Schaber

                                                                                                   
Title:    
President and C.E.O.

      

      

      BUYER:

      

      Fusion
Capital Fund II, LLC

                    By: Fusion Capital Partners, LLC

                                      By: Rockledge Capital
Corporation

                                        

       

      By:  /s/ Josh
Scheinfeld

      Name:  
Josh Scheinfeld

      Title:    
President

      

      

      

      
        
          
            

            - - 

          

           

        

        
           

          
            

          

        

        
           

        

      

      SCHEDULES

      

      Schedule
3(a)                                Organization

      Schedule
3(c)                                Capitalization

      Schedule
3(e)                                Conflicts

      Schedule
3(f)                                1934
Act Filings

      Schedule
3(g)                                Material
Changes

      Schedule
3(h)                                Litigation

      Schedule
3(k)                                Intellectual
Property

      Schedule
3(m)                                Liens

      Schedule
3(q)                                           Certain
Transactions

      

      

      

      

      

      

      EXHIBITS

      

      
        	
                Exhibit
      A

              	
                Form
      of Company Counsel Opinion

              

      

      
        	
                Exhibit
      B

              	
                Form
      of Officer’s Certificate

              

      

      
        	
                Exhibit
      C

              	
                Form
      of Resolutions of Board of Directors of the
  Company

              

      

      
        	
                Exhibit
      D

              	
                Form
      of Secretary’s Certificate

              

      

      
        	
                Exhibit
      E

              	
                Form
      of Letter to Transfer Agent

              

      

      
        	
                Exhibit
      F

              	
                Form
      of Warrant

              

      

      

      

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Schedule
3(a)

      Organization

      

      On
February 12, 2008, the Company submitted its registration for filing to qualify
as a foreign corporation registered to do business in the State of New
Jersey.

      

      Oral
Solutions, Inc. and Orasomal Technologies Inc., two of the Company’s
Subsidiaries, are not currently in good standing in the State of Delaware;
however, the Company has commenced preparation of the documents required for
their good standing status to be renewed.

      

      The
following is a list of the Subsidiaries:

      

      
        	
                Enteron
      Pharmaceuticals, Inc.

              	 
      
	
                Oral
      Solutions, Inc.

              	 
      
	
                Orasomal
      Technologies Inc.

              	 
      

      

      

      

      Schedule
3(c)(iii)

      Capitalization

      

      As of the
date of this Agreement, the Company has: (a) granted stock options with exercise
prices ranging from $0.20 to $3.938 to purchase 10,349,839 shares of common
stock, and (b) issued warrants with exercise prices ranging from $0.246 to $8.11
to purchase 29,209,341 shares of common stock.

      

      Schedule
3(e)

      No
Conflicts

      

      The
Company is required to file a Registration Statement with the SEC within
forty-five (45) days from the date of the Agreement, as set forth in the
Registration Rights agreement and Section 4(a) hereof.

      

      Schedule
3(f)

      1934 Act
Filings

      

      Except
for the Form 8-K dated March 7, 2007, which was filed one day late, since
January 1, 2007, the Company has timely filed all reports schedules, forms,
statements, and other documents required to be filed by it with the SEC pursuant
to the reporting requirements of the 1934 Act.

      

      Letter
dated January 25, 2007 addressed to Amy Bruckner, Staff Accountant of the SEC
and signed by Evan Myrianthopoulos, Chief Financial Officer of the Company. This
Correspondence has been provided to the Buyer.

      

      Letter
dated April 16, 2007 addressed to the SEC, and signed on behalf of the Company
by Christopher J. Schaber, President and Chief Executive Officer of the Company.
This Correspondence has been provided to the Buyer.

      

      

      Schedule
3(g)

      Material
Changes

      

      On
October 19, 2007, the Company filed a Form 8-K with the SEC in which the Company
disclosed that the U.S. Food and Drug Administration (“FDA”) had issued a not
approvable letter for orBec® (oral beclomethasone dipropionate).  The
FDA requested data from additional clinical trials to demonstrate the safety and
efficacy of orBec®.  Additionally, the FDA requested information with
respect to other sections of the Company’s new drug application that was filed
on September 21, 2006.

      

      Schedule
3(h)

      Litigation

      

      On October 28, 2005, the Company
entered into a letter of intent to acquire Gastrotech Pharma A/S (Gastrotech), a
private, Danish biotechnology company developing therapeutics based on
gastrointestinal peptide hormones to treat gastrointestinal and cancer diseases
and conditions. On January 26, 2006, the Company advised Gastrotech that the
Company was not renewing our letter of intent, which had expired in accordance
with its terms on January 15, 2006.  The letter of intent provided for
a $1,000,000 breakup fee in the event either party notified the other of its
intention not to proceed with the transaction.  The attorney
representing Gastrotech has advised the Company that if the Company is not
willing to comply with the terms in the letter of intent, the Company will be in
material breach of its obligations under the letter of intent and will be
obligated to pay Gastrotech a break-up fee of $1,000,000. As of the date of the
Agreement, no claim or complaint has been filed by Gastrotech as to the
obligation to pay a break-up fee of $1,000,000.

      

      Schedule
3(k)

      Intellectual
Property

      

      None.

      Schedule
3(m)

      Liens

      

      None.

      Schedule
3(q)

      Certain
Transactions

      

      None.

      

      

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      EXHIBIT
A

      

      FORM
OF COMPANY COUNSEL OPINION

      (To
be delivered at Commencement)

      

      Capitalized terms used herein but not
defined herein, have the meaning set forth in the Common Stock Purchase
Agreement.  Based on the foregoing, and subject to the assumptions and
qualifications set forth herein, we are of the opinion that:

      

      1.      The
Company is a corporation existing and in good standing under the laws of the
State of Delaware.  The Company is qualified to do business as a
foreign corporation and is in good standing in the State of New
Jersey.

       

      2.      The
Company has the corporate power to execute and deliver, and perform its
obligations under, each Transaction Document to which it is a
party.  The Company has the corporate power to conduct its business
as, to the best of our knowledge, it is now conducted, and to own and use the
properties owned and used by it.

       

      3.      The
execution, delivery and performance by the Company of the Transaction Documents
to which it is a party have been duly authorized by all necessary corporate
action on the part of the Company.  The execution and delivery of the
Transaction Documents by the Company, the performance of the obligations of the
Company thereunder and the consummation by it of the transactions contemplated
therein have been duly authorized and approved by the Company's Board of
Directors and no further consent, approval or authorization of the Company, its
Board of Directors or its stockholders is required.  The Transaction
Documents to which the Company is a party have been duly executed and delivered
by the Company and are the valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms except as such
enforceability may be limited by general principles of equity or applicable
bankruptcy, insolvency, liquidation or similar laws relating to, or affecting
creditor’s rights and remedies.

       

      4.      The
execution, delivery and performance by the Company of the Transaction Documents,
the consummation by the Company of the transactions contemplated thereby
including the offering, sale and issuance of the Purchase Shares in accordance
with the terms and conditions of the Common Stock Purchase Agreement, and
fulfillment and compliance with terms of the Transaction Documents, does not and
shall not: (i) conflict with, constitute a breach of or default (or an
event which, with the giving of notice or lapse of time or both, constitutes or
could constitute a breach or a default), under (a) the Certificate of
Incorporation or the Bylaws of the Company, (b) any material agreement, note,
lease, mortgage, deed or other material instrument to which to our knowledge the
Company is a party or by which the Company or any of its assets are bound,
(ii) result in any violation of any statute, law, rule or regulation
applicable to the Company, or (iii) to our knowledge, violate any order, writ,
injunction or decree applicable to the Company or any of its
subsidiaries.

       

      5.      The
issuance of the Commitment Shares, the Purchase Shares, the Warrant and the
Warrant Shares pursuant to the terms and conditions of the Transaction Documents
has been duly authorized and the Initial Shares are validly issued, fully paid
and non-assessable, to our knowledge, free of all taxes, liens, charges,
restrictions, rights of first refusal and preemptive rights. 20,000,000 shares
of Common Stock have been properly reserved for issuance under the Common Stock
Purchase Agreement for future issuances of Purchase Shares.  1,275,000
shares of Common Stock have been properly reserved for issuance as Additional
Commitment Shares under the Common Stock Purchase Agreement.  When
issued in accordance with the Common Stock Purchase Agreement, the Additional
Commitment Shares shall be validly issued, fully paid and non-assessable, to our
knowledge, free of all taxes, liens, charges, restrictions, rights of first
refusal and preemptive rights. 1,388,889 shares of Common Stock have been
properly reserved (assuming exercise was effected as of the date hereof) for
issuance under the Warrant for future issuances upon exercise of the
Warrant.  The Initial Shares have been issued and paid for in
accordance with the Purchase Agreement, the Initial Shares are validly issued,
fully paid and non-assessable, to our knowledge, free of all taxes, liens,
charges, restrictions, rights of first refusal and preemptive
rights.  When issued and paid for in accordance with the Common Stock
Purchase Agreement, the Purchase Shares (other than the Initial Purchase Shares)
shall be validly issued, fully paid and non-assessable, to our knowledge, free
of all taxes, liens, charges, restrictions, rights of first refusal and
preemptive rights. When issued and paid for in accordance with the Warrant, the
Warrant Shares shall be validly issued, fully paid and non-assessable, to our
knowledge, free of all taxes, liens, charges, restrictions, rights of first
refusal and preemptive rights. To our knowledge, the execution and delivery of
the Registration Rights Agreement do not, and the performance by the Company of
its obligations thereunder shall not, give rise to any rights of any other
person for the registration under the 1933 Act of any shares of Common Stock or
other securities of the Company which have not been waived.

       

      6.      As
of the date hereof, the authorized capital stock of the Company consists of
250,000,000 shares of common stock, par value $0.001, of which to our knowledge
___________ shares are issued and outstanding, and _____________ of which are
reserved for issuance under outstanding stock options, warrants or other
contractual arrangements, including, without limitation, the Warrant, and
5,000,000 shares of preferred stock, of which to our knowledge no shares are
issued or outstanding.  Except as set forth on Schedule 3(c) of the
Purchase Agreement, to our knowledge, there are no outstanding shares of capital
stock or other securities convertible into or exchangeable for shares of the
capital stock of the Company.

       

      7.      Assuming
the accuracy of the representations and your compliance with the covenants made
by you in the Transaction Documents, the offering, sale and issuance of the
Initial Purchase Shares and the Initial Commitment Shares to you pursuant to the
Transaction Documents is exempt from registration under the 1933 Act and the
securities laws and regulations of the State of Delaware Illinois.

       

      8.      Other
than that which has been obtained and completed prior to the date hereof and
before the Staff of the Securities and Exchange Commission has declared the
Registration Statement to be effective, no authorization, approval, consent,
filing or other order of any federal or state governmental body, regulatory
agency, or stock exchange or market, or any court, or, to our knowledge, any
third party is required to be obtained by the Company to enter into and perform
its obligations under the Transaction Documents or for the Company to issue and
sell the Purchase Shares as contemplated by the Transaction
Documents.

       

      9.  Neither the Company, nor
any of its affiliates (as defined in Rule 501 of Regulation D promulgated under
the 1933 Act), nor any person acting on its or their behalf, has distributed any
offering materials or engaged in any form of general solicitation or general
advertising (within the meaning of Regulation D promulgated under the 1933 Act)
in connection with the offer or sale of the Purchase Shares, the Commitment
Shares, or the Warrant Shares.

      

      10.  The Common Stock is
registered pursuant to Section 12(g) of the 1934 Act.  To our
knowledge, since January 1, 2007, the Company has been in compliance with the
reporting requirements of the 1934 Act applicable to it.  To our
knowledge and except as set forth in Schedule 3(e) to the Purchase Agreement,
since January 1, 2007, the Company has not received any written notice from the
Principal Market stating that the Company has not been in compliance with any of
the rules and regulations (including the requirements for continued listing) of
the Principal Market.

       

      We
further advise you that to our knowledge, except as disclosed on Schedule 3(h)
in the Purchase Agreement, there is no action, suit, proceeding, inquiry or
investigation before or by any court, public board or body, any governmental
agency, any stock exchange or market, or self-regulatory organization, which has
been threatened in writing or which is currently pending against the Company,
any of its subsidiaries, any officers or directors of the Company or any of its
subsidiaries or any of the properties of the Company or any of its
subsidiaries.

      

      In addition, we have participated in
the preparation of the Registration Statement  covering the sale of
the Warrant Shares and the Purchase Shares (including the Initial Shares),
including the Prospectus dated _________, contained therein and in conferences
with officers and other representatives of the Company (including the Company’s
independent auditors) during which the contents of the Registration Statement
and related matters were discussed and reviewed and, although we are not passing
upon and do not assume any responsibility for the accuracy, completeness or
fairness of the statements contained in the Registration Statement, on the basis
of the information that was developed in the course of the performance of the
services referred to above, considered in the light of our understanding of the
applicable law, nothing came to our attention that caused us to believe that the
Registration Statement (other than the financial statements and schedules and
the other financial and statistical data included therein, as to which we
express no belief), as of their dates, contained any untrue statement of a
material fact or omitted to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were
made, not misleading.

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      EXHIBIT
B

      

      FORM
OF OFFICER’S CERTIFICATE

      (To
be delivered at Commencement)

      

      This
Officer’s Certificate (“Certificate”) is being
delivered pursuant to Section 7(e) of that certain Common Stock Purchase
Agreement dated as of _________, (“Common Stock Purchase
Agreement”), by and between DOR BioPharma, Inc., a
Delaware corporation (the “Company”), and Fusion Capital Fund II, LLC
(the “Buyer”).  Terms used
herein and not otherwise defined shall have the meanings ascribed to them in the
Common Stock Purchase Agreement.

      

      The
undersigned, ___________, ______________ of the Company, hereby certifies as
follows:

      

      1.           I
am the _____________ of the Company and make the statements contained in this
Certificate;

      

      2.           The
representations and warranties of the Company are true and correct in all
material respects (except to the extent that any of such representations and
warranties is already qualified as to materiality or pursuant to the schedules
referenced in Section 3 of the Common Stock Purchase Agreement, in which case,
such representations and warranties are true and correct without further
qualification) as of the date when made and as of the Commencement Date as
though made at that time (except for representations and warranties that speak
as of a specific date);

      

      3.           The
Company has performed, satisfied and complied in all material respects with
covenants, agreements and conditions required by the Transaction Documents to be
performed, satisfied or complied with by the Company at or prior to the
Commencement Date.

      

      
        	
                4.

              	
                The
      Company has not taken any steps, and does not currently expect to take any
      steps, to seek protection pursuant to any Bankruptcy Law nor does the
      Company or any of its Subsidiaries have any knowledge or reason to believe
      that its creditors intend to initiate involuntary bankruptcy or insolvency
      proceedings. The Company is financially solvent and is generally able to
      pay its debts as they become due.

              

      

      

      IN
WITNESS WHEREOF, I have hereunder signed my name on this __ day of
_______.

      

            ______________________

      Name:

      Title:

      

      The
undersigned as Secretary of ________, a ________ corporation, hereby certifies
that ___________ is the duly elected, appointed, qualified and acting ________
of _________ and that the signature appearing above is his genuine
signature.

      ___________________________________

      Secretary

      EXHIBIT
C-1

      

      FORM
OF COMPANY RESOLUTIONS

      FOR
SIGNING PURCHASE AGREEMENT

      (To
be delivered at the Signing the CSPA)

      

      UNANIMOUS
WRITTEN CONSENT OF

      

      DOR
BioPharma, Inc.

      

      

      Pursuant
to Section ______ of the _________, the undersigned, being all of the directors
of DOR BioPharma, Inc.,
a Delaware corporation (the “Corporation”) do hereby consent to and adopt the
following resolutions as the action of the Board of Directors for and on behalf
of the Corporation and hereby direct that this Consent be filed with the minutes
of the proceedings of the Board of Directors:

      

      WHEREAS, there has been presented to
the Board of Directors of the Corporation a draft of the Common Stock Purchase
Agreement (the “Purchase Agreement”) by and between the Corporation and Fusion
Capital Fund II, LLC (“Fusion”), providing for the purchase by Fusion of up to
Eight Million Five Hundred Thousand ($8,500,000) of the Corporation’s common
stock, $0.001 par value (the “Common Stock”); and

      

      WHEREAS, after careful consideration of
the Purchase Agreement, the documents incident thereto and other factors deemed
relevant by the Board of Directors, the Board of Directors has determined that
it is advisable and in the best interests of the Corporation to engage in the
transactions contemplated by the Purchase Agreement, including, but not limited
to, the issuance of 1,275,000 shares of Common Stock to Fusion as Initial
Commitment Shares and issuance of 2,777,778 shares of Common Stock to Fusion as
Initial Purchase Shares (together the “Initial Shares”), the issuance of
1,275,000 shares of Common Stock to Fusion as Additional Commitment Shares
(together with the Initial Commitment Shares, the “Commitment Shares”), the
issuance of a common stock purchase warrant (the “Warrant”) to purchase
1,388,889 shares of Common Stock (the “Warrant Shares”), and the sale of shares
of Common Stock to Fusion up to the available amount under the Purchase
Agreement (the "Purchase Shares").

      

      Transaction
Documents

       

      NOW,
THEREFORE, BE IT RESOLVED, that the transactions described in the Purchase
Agreement are hereby approved and ____________ and ______________ (the
“Authorized Officers”) are severally authorized to execute and deliver the
Purchase Agreement, and any other agreements or documents contemplated thereby
including, without limitation, the common stock purchase warrant (the “Warrant”
and the shares of Common Stock underlying such Warrant, the “Warrant Shares”)
described in the Purchase Agreement, a registration rights agreement (the
“Registration Rights Agreement”) providing for the registration of the shares of
the Company’s Common Stock issuable in respect of the Purchase Agreement and the
Warrant on behalf of the Corporation, with such amendments, changes, additions
and deletions as the Authorized Officers may deem to be appropriate and approve
on behalf of, the Corporation, such approval to be conclusively evidenced by the
signature of an Authorized Officer thereon; and

       

      FURTHER
RESOLVED, that the terms and provisions of the Warrant by the Corporation to be
issued to Fusion are hereby approved and the Authorized Officers are authorized
to execute and deliver the Warrant (pursuant to the terms of the Purchase
Agreement), with such amendments, changes, additions and deletions as the
Authorized Officer may deem appropriate and approve on behalf of, the
Corporation, such approval to be conclusively evidenced by the signature of an
Authorized Officer thereon; and

       

      FURTHER
RESOLVED, that the terms and provisions of the Registration Rights Agreement by
and between the Corporation and Fusion are hereby approved and the Authorized
Officers are authorized to execute and deliver the Registration Rights Agreement
(pursuant to the terms of the Purchase Agreement), with such amendments,
changes, additions and deletions as the Authorized Officer may deem appropriate
and approve on behalf of, the Corporation, such approval to be conclusively
evidenced by the signature of an Authorized Officer thereon; and

       

      FURTHER
RESOLVED, that the terms and provisions of the Form of Transfer Agent
Instructions (the “Instructions”) are hereby approved and the Authorized
Officers are authorized to execute and deliver the Instructions (pursuant to the
terms of the Purchase Agreement), with such amendments, changes, additions and
deletions as the Authorized Officers may deem appropriate and approve on behalf
of, the Corporation, such approval to be conclusively evidenced by the signature
of an Authorized Officer thereon; and

       

      Execution of Purchase
Agreement

       

      FURTHER
RESOLVED, that the Corporation be and it hereby is authorized to execute the
Purchase Agreement providing for the purchase of common stock of the Corporation
having an aggregate value of up to $8,500,000; and

       

      Issuance of Common Stock and
Warrant

       

      FURTHER
RESOLVED, that the Corporation is hereby authorized to issue 4,052,778 shares of
Common Stock to Fusion Capital Fund II, LLC as Initial Shares and that upon
issuance of the Initial Commitment Shares pursuant to the Purchase Agreement,
the Initial Shares shall be duly authorized, validly issued, fully paid and
nonassessable with no personal liability attaching to the ownership thereof;
and

       

      FURTHER
RESOLVED, that the Corporation is hereby authorized to issue 1,275,000 shares of
Common Stock (subject to equitable adjustment for any reorganization,
recapitalization, non-cash dividend, stock split or other similar transaction)
in connection with the purchase of Purchase Shares (the “Additional Commitment
Shares”) in accordance with the terms of the Purchase Agreement and that, upon
issuance of the Additional Commitment Shares pursuant to the Purchase Agreement,
the Additional Commitment Shares will be duly authorized, validly issued, fully
paid and nonassessable with no personal liability attaching to the ownership
thereof; and

       

      FURTHER
RESOLVED, that the Corporation shall initially reserve 1,275,000 shares of
Common Stock (subject to equitable adjustment for any reorganization,
recapitalization, non-cash dividend, stock split or other similar transaction)
for issuance as Additional Commitment Shares under the Purchase
Agreement.

       

      FURTHER
RESOLVED, that the Corporation is hereby authorized to issue the Warrant under
the Purchase Agreement in accordance with the terms of the Purchase Agreement
and that, upon issuance of the Warrant pursuant to the Purchase Agreement, the
Warrant will be duly authorized, validly issued, fully paid and nonassessable
with no personal liability attaching to the ownership thereof; and

       

      FURTHER
RESOLVED, that the Corporation is hereby authorized to issue the Warrant Shares
under the Warrant in accordance with the terms of the Warrant and that, upon
issuance of the Warrant Shares pursuant to the Warrant, the Warrant Shares will
be duly authorized, validly issued, fully paid and nonassessable with no
personal liability attaching to the ownership thereof; and

       

      FURTHER
RESOLVED, that the Corporation shall initially reserve 1,388,889 shares of
Common Stock (subject to equitable adjustment for any reorganization,
recapitalization, non-cash dividend, stock split or other similar transaction)
for issuance as Warrant Shares under the Warrant.

       

      FURTHER
RESOLVED, that the Corporation is hereby authorized to issue shares of Common
Stock upon the purchase of Purchase Shares up to the Available Amount under the
Purchase Agreement in accordance with the terms of the Purchase Agreement and
that, upon issuance of the Purchase Shares pursuant to the Purchase Agreement,
the Purchase Shares will be duly authorized, validly issued, fully paid and
nonassessable with no personal liability attaching to the ownership thereof;
and

       

      FURTHER
RESOLVED, that the Corporation shall initially reserve 20,000,000 shares of
Common Stock for issuance as Purchase Shares after the Commencement under the
Purchase Agreement (not including the 2,777,778 Initial Purchase Shares as
defined in the Agreement).

       

      Approval of
Actions

       

      FURTHER
RESOLVED, that, without limiting the foregoing, the Authorized Officers are, and
each of them hereby is, authorized and directed to proceed on behalf of the
Corporation and to take all such steps as deemed necessary or appropriate, with
the advice and assistance of counsel, to cause the Corporation to consummate the
agreements referred to herein and to perform its obligations under such
agreements; and

       

      FURTHER RESOLVED, that the Authorized
Officers be, and each of them hereby is, authorized, empowered and directed on
behalf of and in the name of the Corporation, to take or cause to be taken all
such further actions and to execute and deliver or cause to be executed and
delivered all such further agreements, amendments, documents, certificates,
reports, schedules, applications, notices, letters and undertakings and to incur
and pay all such fees and expenses as in their judgment shall be necessary,
proper or desirable to carry into effect the purpose and intent of any and all
of the foregoing resolutions, and that all actions heretofore taken by any
officer or director of the Corporation in connection with the transactions
contemplated by the agreements described herein are hereby approved, ratified
and confirmed in all respects.

      

      FURTHER RESOLVED, that the foregoing
resolutions do hereby constitute prior approval of (i) the issuance of the
Company’s voting stock to Fusion and (ii) Fusion becoming a holder of 15% or
more of the Company’s  outstanding voting stock for purposes of
Section 203 of the Delaware General Corporation Law and any other similar laws
that may be deemed applicable to the Company.

      

      This
Unanimous Written Consent may be executed in one or more counterparts each of
which when executed shall be deemed to be an original but all of which taken
together shall constitute one and the same document.

      

      IN WITNESS WHEREOF, the Board of
Directors has executed and delivered this Consent effective as of the date the
last director signed this document.

      

      

      

      ______________________                                                                                     February
___, 2008

      

      

      ______________________                                                                                     February
___, 2008

      

      

      ______________________                                                                                     February
___, 2008

      

      

      ______________________                                                                                     February
___, 2008

      

      

      

      

      being all
of the directors of DOR BioPharma, Inc.

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      EXHIBIT
C-2

      

      FORM
OF COMPANY RESOLUTIONS APPROVING REGISTRATION STATEMENT

      (To
be delivered at Commencement)

      

      UNANIMOUS
WRITTEN CONSENT OF

      DOR
BioPharma, Inc.

      

      

      Pursuant
to Section 141(f) of the Delaware General Corporation Law, the undersigned,
being all of the directors of DOR BIOPHARMA, INC., a
Delaware corporation (the “Corporation”) do hereby consent to and adopt the
following resolutions as the action of the Board of Directors for and on behalf
of the Corporation and hereby direct that this Consent be filed with the minutes
of the proceedings of the Board of Directors;

      

      WHEREAS, there has been presented to
the Board of Directors of the Corporation a draft of the Common Stock Purchase
Agreement (the “Purchase Agreement”) by and between the Corporation and Fusion
Capital Fund II, LLC (“Fusion”), providing for the purchase by Fusion of up to
Eight Million Five Hundred Thousand Dollars ($8,500,000) of the Corporation’s
common stock, par value $0.001  (the “Common Stock”);

      

      WHEREAS, after careful consideration of
the Purchase Agreement, the documents incident thereto and other factors deemed
relevant by the Board of Directors, the Board of Directors has determined that
it is advisable and in the best interests of the Corporation to engage in
transactions contemplated by the Purchase Agreement, including but not limited
to, the issuance of 1,275,000 shares of Common Stock to Fusion as Initial
Commitment Shares and issuance of 2,777,778 shares of Common Stock to Fusion as
Initial Purchase Shares (together the “Initial Shares”), the issuance of
1,275,000 shares of Common Stock to Fusion as Additional Commitment Shares
(together with the Initial Commitment Shares, the “Commitment Shares”), the
issuance of a common stock purchase warrant (the “Warrant”) to purchase
1,388,889 shares of Common Stock (the “Warrant Shares”), and the sale of shares
of Common Stock to Fusion up to the available amount under the Purchase
Agreement (the "Purchase Shares");

      

      WHEREAS,
in connection with the transactions contemplated pursuant to the Purchase
Agreement, the Company has agreed to file a registration statement with the
Securities and Exchange Commission (the “Commission”) registering the Warrant
Shares (as herein defined and to list the Commitment Shares and the Purchase
Shares on the American Stock Exchange;

       

      WHEREAS,
the management of the Corporation has prepared an initial draft of a
Registration Statement on Form S-1  (the “Registration Statement”) in
order to register the sale of the the Purchase Shares and the Commitment Shares
(collectively, the “Shares”); and

       

      WHEREAS,
the Board of Directors has determined to approve the Registration Statement and
to authorize the appropriate officers of the Corporation to take all such
actions as they may deem appropriate to effect the offering.

       

      NOW,
THEREFORE, BE IT RESOLVED, that the Authorized Officers and directors of the
Corporation be, and each of them hereby is, authorized and directed, with the
assistance of counsel and accountants for the Corporation, to prepare, execute
and file with the Commission the Registration Statement, which Registration
Statement shall be filed substantially in the form presented to the Board of
Directors, with such changes therein as the Chief Executive Officer of the
Corporation or any Vice President of the Corporation shall deem desirable and in
the best interest of the Corporation and its shareholders (such officer’s
execution thereof including such changes shall be deemed to evidence
conclusively such determination); and

       

      FURTHER
RESOLVED, that the officers of the Corporation be, and each of them hereby is,
authorized and directed, with the assistance of counsel and accountants for the
Corporation, to prepare, execute and file with the Commission all amendments,
including post-effective amendments, and supplements to the Registration
Statement, and all certificates, exhibits, schedules, documents and other
instruments relating to the Registration Statement, as such officers shall deem
necessary or appropriate (such officer’s execution and filing thereof shall be
deemed to evidence conclusively such determination); and

       

      FURTHER
RESOLVED, that the execution of the Registration Statement and of any amendments
and supplements thereto by the officers and directors of the Corporation be, and
the same hereby is, specifically authorized either personally or by the
Authorized Officers as such officer’s or director’s true and lawful
attorneys-in-fact and agents; and

       

      FURTHER
RESOLVED, that the Authorized Officers are hereby designated as “Agent for
Service” of the Corporation in connection with the Registration Statement and
the filing thereof with the Commission, and the Authorized Officers hereby are
authorized to receive communications and notices from the Commission with
respect to the Registration Statement; and

       

      FURTHER
RESOLVED, that the officers of the Corporation be, and each of them hereby is,
authorized and directed to pay all fees, costs and expenses that may be incurred
by the Corporation in connection with the Registration Statement;
and

       

      FURTHER
RESOLVED, that it is desirable and in the best interest of the Corporation that
the Shares be qualified or registered for sale in various states; that the
officers of the Corporation be, and each of them hereby is, authorized to
determine the states in which appropriate action shall be taken to qualify or
register for sale all or such part of the Shares as they may deem advisable;
that said officers be, and each of them hereby is, authorized to perform on
behalf of the Corporation any and all such acts as they may deem necessary or
advisable in order to comply with the applicable laws of any such states, and in
connection therewith to execute and file all requisite papers and documents,
including, but not limited to, applications, reports, surety bonds, irrevocable
consents, appointments of attorneys for service of process and resolutions; and
the execution by such officers of any such paper or document or the doing by
them of any act in connection with the foregoing matters shall conclusively
establish their authority therefor from the Corporation and the approval and
ratification by the Corporation of the papers and documents so executed and the
actions so taken; and

       

      FURTHER
RESOLVED, that if, in any state where the securities to be registered or
qualified for sale to the public, or where the Corporation is to be registered
in connection with the public offering of the Shares, a prescribed form of
resolution or resolutions is required to be adopted by the Board of Directors,
each such resolution shall be deemed to have been and hereby is adopted, and the
Secretary is hereby authorized to certify the adoption of all such resolutions
as though such resolutions were now presented to and adopted by the Board of
Directors; and

       

                 FURTHER
RESOLVED, that the officers of the Corporation with the assistance of counsel
be, and each of them hereby is, authorized and directed to take all necessary
steps and do all other things necessary and appropriate to effect the listing of
the Shares on the Nasdaq OTC Bulletin Board market, if any.

       

      Approval of
Actions

       

      FURTHER
RESOLVED, that, without limiting the foregoing, the authorized officers are, and
each of them hereby is, authorized and directed to proceed on behalf of the
Corporation and to take all such steps as are deemed necessary or appropriate,
with the advice and assistance of counsel, to cause the Corporation to
consummate the agreements referred to herein and to perform its obligations
under such agreements; and

       

      FURTHER RESOLVED, that the Authorized
Officers be, and each of them hereby is, authorized, empowered and directed on
behalf of and in the name of the Corporation, to take or cause to be taken all
such further actions and to execute and deliver or cause to be executed and
delivered all such further agreements, amendments, documents, certificates,
reports, schedules, applications, notices, letters and undertakings and to incur
and pay all such fees and expenses as in their judgment shall be necessary,
proper or desirable to carry into effect the purpose and intent of any and all
of the foregoing resolutions, and that all actions heretofore taken by any
officer or director of the Corporation in connection with the transactions
contemplated by the agreements described herein are hereby approved, ratified
and confirmed in all respects.

      

      This Unanimous Written Consent may be
executed in one or more counterparts, each of which when executed shall be
deemed to be an original but all of which taken together shall constitute one
and the same document.

      

      IN
WITNESS WHEREOF, the Board of Directors has executed and delivered this Consent
effective as of the date the last director signed this document.

      

      ______________________                                                                                     February
___, 2008

      

      

      ______________________                                                                                     February
___, 2008

      

      

      ______________________                                                                                     February
___, 2008

      

      

      ______________________                                                                                     February
___, 2008

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      EXHIBIT
D

      FORM
OF SECRETARY’S CERTIFICATE

      (To
be delivered at Commencement)

      

      This Secretary’s Certificate
(“Certificate”) is being delivered pursuant to Section 7(k) of that certain
Common Stock Purchase Agreement dated as of __________, (“Common Stock Purchase
Agreement”), by and between DOR
BioPharma, Inc., a Delaware corporation (the “Company”) and Fusion Capital Fund II, LLC
(the “Buyer”), pursuant to which the Company may sell to the Buyer up to Eight
Million Five Hundred Thousand ($8,500,000) of the Company's Common Stock, $0.001
par value (the "Common Stock").  Terms used herein and not otherwise
defined shall have the meanings ascribed to them in the Common Stock Purchase
Agreement.

      

      The undersigned, ____________,
Secretary of the Company, hereby certifies as follows:

      

      1.           I
am the Secretary of the Company and make the statements contained in this
Secretary’s Certificate.

      

      2.           Attached
hereto as Exhibit
A and Exhibit
B are true, correct and complete copies of the Company’s bylaws
(“Bylaws”) and Certificate of Incorporation (“Articles”), in each case, as
amended through the date hereof, and no action has been taken by the Company,
its directors, officers or shareholders, in contemplation of the filing of any
further amendment relating to or affecting the Bylaws or Articles.

      

      3.           Attached
hereto as Exhibit
C are true, correct and complete copies of the resolutions duly adopted
by the Board of Directors of the Company on _____________, at which a quorum was
present and acting throughout.  Such resolutions have not been
amended, modified or rescinded and remain in full force and effect and such
resolutions are the only resolutions adopted by the Company’s Board of
Directors, or any committee thereof, or the shareholders of the Company relating
to or affecting (i) the entering into and performance of the Common Stock
Purchase Agreement, or the issuance, offering and sale of the Purchase Shares,
the Warrant and the Warrant Shares and (ii) and the performance of the Company
of its obligation under the Transaction Documents as contemplated
therein.

      

      4.           As
of the date hereof, the authorized, issued and reserved capital stock of the
Company is as set forth on Exhibit D
hereto.

      

      IN WITNESS WHEREOF, I have
hereunder signed my name on this ___ day of ____________.

      

                                                                              _________________________

      Secretary

      

      

      The
undersigned as ___________ of __________, a ________ corporation, hereby
certifies that ____________ is the duly elected, appointed, qualified and acting
Secretary of _________, and that the signature appearing above is his genuine
signature.

      

                                                                             ___________________________________

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      EXHIBIT
E

      

      FORM
OF LETTER TO THE TRANSFER AGENT FOR THE ISSUANCE OF THE COMMITMENTS SHARES AT
SIGNING OF THE PURCHASE AGREEMENT

      

      

      

      

      [COMPANY
LETTERHEAD]

      

      

      

      [DATE]

      

      [TRANSFER
AGENT]

      __________________

      __________________

      __________________

      

      Re:
Issuance of Common Shares to Fusion Capital Fund II, LLC

      

      Dear
________,

      

      On behalf
of DOR BioPharma, Inc.,
(the “Company”), you are hereby instructed to issue as soon
as possible 4,052,778 shares of our
common stock in the name of Fusion
Capital Fund II, LLC.  The share certificate should be dated
[DATE OF THE COMMON STOCK PURCHASE AGREEMENT].  I have included a true
and correct copy of a unanimous written consent executed by all of the members
of the Board of Directors of the Company adopting resolutions approving the
issuance of these shares.  The shares should be issued subject only to
the following restrictive legend:

      

      THE
SECURITIES REPRESENTED BY THIS CERTIFICATE 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, UNLESS SOLD PURSUANT TO: (1) RULE 144 UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR (2) AN OPINION OF HOLDER’S COUNSEL,
IN A CUSTOMARY FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR
APPLICABLE STATE SECURITIES LAWS.

      

      The share
certificate should be sent as soon
as possible via overnight mail to the following address:

      

      Fusion
Capital Fund II, LLC

      222
Merchandise Mart Plaza, Suite 9-112

      Chicago,
IL 60654

      Attention:
Steven Martin

      

      Thank you
very much for your help.  Please call me at ______________ if you have
any questions or need anything further.

      

      

      

      

      DOR BioPharma,
Inc.

      

      

      BY:_____________________________

      [name]

      [title]

      

      

      

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      EXHIBIT
F

      

      FORM
OF WARRANT

      (To
be delivered at the Signing the CSPA)

      

      

      

      Attached
hereto.regrightsfusion022008.htm

     Exhibit 10.36

     

    
      

      

    

    
 

    REGISTRATION
RIGHTS AGREEMENT

    

    REGISTRATION RIGHTS AGREEMENT
(this "Agreement"),
dated as of February 14, 2008, by and between DOR BioPharma, Inc., a
Delaware corporation, (the "Company"), and Fusion Capital Fund II, LLC
(together with it permitted assigns, the “Buyer”).  Capitalized
terms used herein and not otherwise defined herein shall have the respective
meanings set forth in the Common Stock Purchase Agreement by and between the
parties hereto, dated as of the date hereof (as amended, restated, supplemented
or otherwise modified from time to time, the "Purchase
Agreement").

    

    WHEREAS:

    

    A.           The
Company has agreed, upon the terms and subject to the conditions of the Purchase
Agreement, to issue to the Buyer up to Eight Million Five Hundred Thousand
($8,500,000) of the Company's common stock, $0.001 par value (the "Common Stock");
and

    

    B.           To
induce the Buyer to enter into the Purchase Agreement, the Company has agreed to
provide certain registration rights under the Securities Act of 1933, as
amended, and the rules and regulations thereunder, or any similar successor
statute (collectively, the "1933 Act"), and applicable
state securities laws.

    

    NOW, THEREFORE, in
consideration of the premises and the mutual covenants contained herein and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Company and the Buyer hereby agree as
follows:

    

    1.           DEFINITIONS.

    

    As used
in this Agreement, the following terms shall have the following
meanings:

    

    a.           "Investor" means the Buyer, any
transferee or assignee thereof to whom a Buyer assigns its rights under this
Agreement and who agrees to become bound by the provisions of this Agreement in
accordance with Section 9 and any transferee or assignee thereof to whom a
transferee or assignee assigns its rights under this Agreement and who agrees to
become bound by the provisions of this Agreement in accordance with Section
9.

    

    b.           "Person" means any person or
entity including any corporation, a limited liability company, an association, a
partnership, an organization, a business, an individual, a governmental or
political subdivision thereof or a governmental agency.

    

    c.           "Register," "registered," and "registration" refer to a
registration effected by preparing and filing one or more registration
statements of the Company in compliance with the 1933 Act and pursuant to Rule
415 under the 1933 Act or any successor rule providing for offering securities
on a continuous basis ("Rule
415"), and the declaration or ordering of effectiveness of such
registration statement(s) by the United States Securities and Exchange
Commission (the "SEC").

    

    d.           "Registrable Securities" means
the 2,777,778 Initial Purchase Shares, the 1,275,000 Initial Commitment Shares
and the 1,275,000 Additional Commitment Shares, the Purchase Shares which after
Commencement may from time to time be issued or issuable upon purchases of the
Available Amount under the Purchase Agreement, and in each such case, any shares
of capital stock issued or issuable with respect to such shares or the Purchase
Agreement as a result of any stock split, stock dividend, recapitalization,
exchange or similar event or otherwise, without regard to any limitation on
purchases under the Purchase Agreement.

    

    e.           "Registration Statement" means
the registration statement of the Company covering only the sale of the
Registrable Securities.

    

    2.           REGISTRATION.

    

    a.           Mandatory
Registration.  The Company shall within forty-five (45) days
from the date hereof file with the SEC the Registration
Statement.  The Registration Statement shall register the Registrable
Securities.  The Investor and its counsel shall have a reasonable
opportunity to review and comment upon such registration statement or amendment
to such registration statement and any related prospectus prior to its filing
with the SEC.  Investor shall furnish all information reasonably
requested by the Company for inclusion therein.  The Company shall use
its best efforts to have the Registration Statement or amendment declared
effective by the SEC at the earliest possible date.  The Company shall
use reasonable best efforts to keep the Registration Statement effective
pursuant to Rule 415 promulgated under the 1933 Act and available for sales of
all of the Registrable Securities at all times until the earlier of (i) the date
as of which the Investor may sell all of the Registrable Securities without
restriction pursuant to Rule 144(k) promulgated under the 1933 Act (or successor
thereto) or (ii) the date on which (A) the Investor shall have sold all the
Registrable Securities and no Available Amount remains under the Purchase
Agreement (the "Registration
Period").  The Registration Statement (including any amendments
or supplements thereto and prospectuses contained therein) shall not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein, or necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading.

    

    b.           Rule 424
Prospectus.  The Company shall, as required by applicable
securities regulations, from time to time file with the SEC, pursuant to Rule
424 promulgated under the 1933 Act, the prospectus and prospectus supplements,
if any, to be used in connection with sales of the Registrable Securities under
the Registration Statement.  The Investor and its counsel shall have a
reasonable opportunity to review and comment upon such prospectus prior to its
filing with the SEC. The Investor shall use its reasonable best efforts to
comment upon such prospectus within one (1) Business Day from the date the
Investor receives the final version of such prospectus.

    

    c.           Sufficient Number of Shares
Registered.  In the event the number of shares available under
the Registration Statement is insufficient to cover all of the Registrable
Securities, the Company shall amend the Registration Statement or file a new
registration statement (a ”New
Registration Statement”), so as to cover all of such Registrable
Securities as soon as practicable, but in any event not later than ten (10)
Business Days after the necessity therefor arises.  The Company shall
use it reasonable best efforts to cause such amendment and/or New Registration
Statement to become effective as soon as practicable following the filing
thereof.

    

    3.           RELATED
OBLIGATIONS.

    

    With
respect to the Registration Statement and whenever any Registrable Securities
are to be registered pursuant to Section 2(b) including on any New Registration
Statement, the Company shall use its reasonable best efforts to effect the
registration of the Registrable Securities in accordance with the intended
method of disposition thereof and, pursuant thereto, the Company shall have the
following obligations:

    

    a.           The
Company shall prepare and file with the SEC such amendments (including
post-effective amendments) and supplements to any registration statement and the
prospectus used in connection with such registration statement, which prospectus
is to be filed pursuant to Rule 424 promulgated under the 1933 Act, as may be
necessary to keep the Registration Statement or any New Registration Statement
effective at all times during the Registration Period, and, during such period,
comply with the provisions of the 1933 Act with respect to the disposition of
all Registrable Securities of the Company covered by the Registration Statement
or any New Registration Statement until such time as all of such Registrable
Securities shall have been disposed of in accordance with the intended methods
of disposition by the seller or sellers thereof as set forth in such
registration statement.

    

    b.           The
Company shall permit the Investor to review and comment upon the Registration
Statement or any New Registration Statement and all amendments and supplements
thereto at least two (2) Business Days prior to their filing with the SEC, and
not file any document in a form to which Investor reasonably
objects.  The Investor shall use its reasonable best efforts to
comment upon the Registration Statement or any New Registration Statement and
any amendments or supplements thereto within two (2) Business Days from the date
the Investor receives the final version  thereof.  The
Company shall furnish to the Investor, without charge any correspondence from
the SEC or the staff of the SEC to the Company or its representatives relating
to the Registration Statement or any New Registration Statement.

    

    c.           Upon
request of the Investor, the Company shall furnish to the Investor, (i) promptly
after the same is prepared and filed with the SEC, at least one copy of such
registration statement and any amendment(s) thereto, including financial
statements and schedules, all documents incorporated therein by reference and
all exhibits, (ii) upon the effectiveness of any registration statement, a copy
of the prospectus included in such registration statement and all amendments and
supplements thereto (or such other number of copies as the Investor may
reasonably request) and (iii) such other documents, including copies of any
preliminary or final prospectus, as the Investor may reasonably request from
time to time in order to facilitate the disposition of the Registrable
Securities owned by the Investor.

    

    d.           The
Company shall use reasonable best efforts to (i) register and qualify the
Registrable Securities covered by a registration statement under such other
securities or "blue sky" laws of such jurisdictions in the United States as the
Investor reasonably requests, (ii) prepare and file in those jurisdictions, such
amendments (including post-effective amendments) and supplements to such
registrations and qualifications as may be necessary to maintain the
effectiveness thereof during the Registration Period, (iii) take such other
actions as may be necessary to maintain such registrations and qualifications in
effect at all times during the Registration Period, and (iv) take all other
actions reasonably necessary or advisable to qualify the Registrable Securities
for sale in such jurisdictions; provided, however, that the Company shall not be
required in connection therewith or as a condition thereto to (x) qualify to do
business in any jurisdiction where it would not otherwise be required to qualify
but for this Section 3(d), (y) subject itself to general taxation in any such
jurisdiction, or (z) file a general consent to service of process in any such
jurisdiction.  The Company shall promptly notify the Investor who
holds Registrable Securities of the receipt by the Company of any notification
with respect to the suspension of the registration or qualification of any of
the Registrable Securities for sale under the securities or "blue sky" laws of
any jurisdiction in the United States or its receipt of actual notice of the
initiation or threatening of any proceeding for such purpose.

    

    e.           As
promptly as practicable after becoming aware of such event or facts, the Company
shall notify the Investor in writing of the happening of any event or existence
of such facts as a result of which the prospectus included in any registration
statement, as then in effect, includes an untrue statement of a material fact or
omits to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading, and promptly prepare a supplement or amendment to such
registration statement to correct such untrue statement or omission, and deliver
a copy of such supplement or amendment to the Investor (or such other number of
copies as the Investor may reasonably request).  The Company shall
also promptly notify the Investor in writing (i) when a prospectus or any
prospectus supplement or post-effective amendment has been filed, and when a
registration statement or any post-effective amendment has become effective
(notification of such effectiveness shall be delivered to the Investor by
facsimile on the same day of such effectiveness and by overnight mail), (ii) of
any request by the SEC for amendments or supplements to any registration
statement or related prospectus or related information, and (iii) of the
Company's reasonable determination that a post-effective amendment to a
registration statement would be appropriate.

    

    f.           The
Company shall use its reasonable best efforts to prevent the issuance of any
stop order or other suspension of effectiveness of any registration statement,
or the suspension of the qualification of any Registrable Securities for sale in
any jurisdiction and, if such an order or suspension is issued, to obtain the
withdrawal of such order or suspension at the earliest possible moment and to
notify the Investor of the issuance of such order and the resolution thereof or
its receipt of actual notice of the initiation or threat of any proceeding for
such purpose.

    

    g.           The
Company shall (i) cause all the Registrable Securities to be listed on each
securities exchange on which securities of the same class or series issued by
the Company are then listed, if any, if the listing of such Registrable
Securities is then permitted under the rules of such exchange, or (ii) secure
designation and quotation of all the Registrable Securities on the Principal
Market. The Company shall pay all fees and expenses in connection with
satisfying its obligation under this Section.

    

    h.           The
Company shall cooperate with the Investor to facilitate the timely preparation
and delivery of certificates (not bearing any restrictive legend) representing
the Registrable Securities to be offered pursuant to any registration statement
and enable such certificates to be in such denominations or amounts as the
Investor may reasonably request and registered in such names as the Investor may
request.

    

    i.           The
Company shall at all times provide a transfer agent and registrar with respect
to its Common Stock.

    

    j.           If
reasonably requested by the Investor, the Company shall (i) immediately
incorporate in a prospectus supplement or post-effective amendment such
information as the Investor believes should be included therein relating to the
sale and distribution of Registrable Securities, including, without limitation,
information with respect to the number of Registrable Securities being sold, the
purchase price being paid therefor and any other terms of the offering of the
Registrable Securities; (ii) make all required filings of such prospectus
supplement or post-effective amendment as soon as notified of the matters to be
incorporated in such prospectus supplement or post-effective amendment; and
(iii) supplement or make amendments to any registration statement.

    

    k.           The
Company shall use its reasonable best efforts to cause the Registrable
Securities covered by any registration statement to be registered with or
approved by such other governmental agencies or authorities as may be necessary
to consummate the disposition of such Registrable Securities.

    

    l.           Within
one (1) Business Day after any registration statement which includes the
Registrable Securities is ordered effective by the SEC, the Company shall
deliver, and shall cause legal counsel for the Company to deliver, to the
transfer agent for such Registrable Securities (with copies to the Investor)
confirmation that such registration statement has been declared effective by the
SEC in the form attached hereto as Exhibit
A.  Thereafter, if requested by the Buyer at any time, the
Company shall require its counsel to deliver to the Buyer a written confirmation
whether or not the effectiveness of such registration statement has lapsed at
any time for any reason (including, without limitation, the issuance of a stop
order) and whether or not the registration statement is current and available to
the Buyer for sale of all of the Registrable Securities.

    

    m.           The
Company shall take all other reasonable actions necessary to expedite and
facilitate disposition by the Investor of Registrable Securities pursuant to any
registration statement.

    

    4.           OBLIGATIONS OF THE
INVESTOR.

    

    a.           The
Company shall notify the Investor in writing of the information the Company
reasonably requires from the Investor in connection with any registration
statement hereunder.  The Investor shall furnish to the Company such
information regarding itself, the Registrable Securities held by it and the
intended method of disposition of the Registrable Securities held by it as shall
be reasonably required to effect the registration of such Registrable Securities
and shall execute such documents in connection with such registration as the
Company may reasonably request.

    

    b.           The
Investor agrees to cooperate with the Company as reasonably requested by the
Company in connection with the preparation and filing of any registration
statement hereunder.

    

    c.           The
Investor agrees that, upon receipt of any notice from the Company of the
happening of any event or existence of facts of the kind described in Section
3(f) or the first sentence of 3(e), the Investor will immediately discontinue
disposition of Registrable Securities pursuant to any registration statement(s)
covering such Registrable Securities until the Investor's receipt of the copies
of the supplemented or amended prospectus contemplated by Section 3(f) or the
first sentence of 3(e). Notwithstanding anything to the contrary, the Company
shall cause its transfer agent to promptly deliver shares of Common Stock
without any restrictive legend in accordance with the terms of the Purchase
Agreement in connection with any sale of Registrable Securities with respect to
which an Investor has entered into a contract for sale prior to the Investor's
receipt of a notice from the Company of the happening of any event of the kind
described in Section 3(f) or the first sentence of 3(e) and for which the
Investor has not yet settled.

    

    5.           EXPENSES OF
REGISTRATION.

    

    All
reasonable expenses, other than sales or brokerage commissions, incurred in
connection with registrations, filings or qualifications pursuant to Sections 2
and 3, including, without limitation, all registration, listing and
qualifications fees, printers and accounting fees, and fees and disbursements of
counsel for the Company, shall be paid by the Company.

    

    6.           INDEMNIFICATION.

    

    a.           To
the fullest extent permitted by law, the Company will, and hereby does,
indemnify, hold harmless and defend the Investor, each Person, if any, who
controls the Investor, the members, the directors, officers, partners,
employees, agents, representatives of the Investor and each Person, if any, who
controls the Investor within the meaning of the 1933 Act or the Securities
Exchange Act of 1934, as amended (the "1934 Act") (each, an "Indemnified Person"), against
any losses, claims, damages, liabilities, judgments, fines, penalties, charges,
costs, attorneys' fees, amounts paid in settlement or expenses, joint or
several, (collectively, "Claims") incurred in
investigating, preparing or defending any action, claim, suit, inquiry,
proceeding, investigation or appeal taken from the foregoing by or before any
court or governmental, administrative or other regulatory agency, body or the
SEC, whether pending or threatened, whether or not an indemnified party is or
may be a party thereto ("Indemnified Damages"), to
which any of them may become subject insofar as such Claims (or actions or
proceedings, whether commenced or threatened, in respect thereof) arise out of
or are based upon: (i) any untrue statement or alleged untrue statement of a
material fact in the Registration Statement, any New Registration Statement or
any post-effective amendment thereto or in any filing made in connection with
the qualification of the offering under the securities or other "blue sky" laws
of any jurisdiction in which Registrable Securities are offered ("Blue Sky Filing"), or the
omission or alleged omission to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, (ii) any
untrue statement or alleged untrue statement of a material fact contained in the
final prospectus (as amended or supplemented, if the Company files any amendment
thereof or supplement thereto with the SEC) or the omission or alleged omission
to state therein any material fact necessary to make the statements made
therein, in light of the circumstances under which the statements therein were
made, not misleading, (iii) any violation or alleged violation by the Company of
the 1933 Act, the 1934 Act, any other law, including, without limitation, any
state securities law, or any rule or regulation thereunder relating to the offer
or sale of the Registrable Securities pursuant to the Registration Statement or
any New Registration Statement  or (iv) any material violation by the
Company of this Agreement (the matters in the foregoing clauses (i) through (iv)
being, collectively, "Violations").  The
Company shall reimburse each Indemnified Person promptly as such expenses are
incurred and are due and payable, for any legal fees or other reasonable
expenses incurred by them in connection with investigating or defending any such
Claim.  Notwithstanding anything to the contrary contained herein, the
indemnification agreement contained in this Section 6(a): (i) shall not apply to
a Claim by an Indemnified Person arising out of or based upon a Violation which
occurs in reliance upon and in conformity with information furnished in writing
to the Company by such Indemnified Person expressly for use in connection with
the preparation of the Registration Statement, any New Registration Statement or
prospectus or any such amendment thereof or supplement thereto, if such
prospectus was timely made available by the Company pursuant to Section 3(c) or
Section 3(e); (ii) with respect to any superceded prospectus, shall not inure to
the benefit of any such person from whom the person asserting any such Claim
purchased the Registrable Securities that are the subject thereof (or to the
benefit of any person controlling such person) if the untrue statement or
omission of material fact contained in the superceded prospectus was corrected
in the revised prospectus, as then amended or supplemented, if such revised
prospectus was timely made available by the Company pursuant to Section 3(c) or
Section 3(e), and the Indemnified Person was promptly advised in writing not to
use the incorrect prospectus prior to the use giving rise to a violation and
such Indemnified Person, notwithstanding such advice, used it; (iii) shall not
be available to the extent such Claim is based on a failure of the Investor to
deliver or to cause to be delivered the prospectus made available by the
Company, if such prospectus was timely made available by the Company pursuant to
Section 3(c) or Section 3(e); and (iv) shall not apply to amounts paid in
settlement of any Claim if such settlement is effected without the prior written
consent of the Company, which consent shall not be unreasonably
withheld.  Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of the Indemnified Person
and shall survive the transfer of the Registrable Securities by the Investor
pursuant to Section 9.

    

    b.           In
connection with the Registration Statement or any New Registration Statement,
the Investor agrees to severally and not jointly indemnify, hold harmless and
defend, to the same extent and in the same manner as is set forth in Section
6(a), the Company, each of its directors, each of its officers who signs the
Registration Statement or any New Registration Statement, each Person, if any,
who controls the Company within the meaning of the 1933 Act or the 1934 Act
(collectively and together with an Indemnified Person, an "Indemnified Party"), against
any Claim or Indemnified Damages to which any of them may become subject, under
the 1933 Act, the 1934 Act or otherwise, insofar as such Claim or Indemnified
Damages arise out of or are based upon any Violation, in each case to the
extent, and only to the extent, that such Violation occurs in reliance upon and
in conformity with written information about the Investor set forth on Exhibit B attached
hereto and furnished to the Company by the Investor expressly for use in
connection with such registration statement; and, subject to Section 6(d), the
Investor shall promptly reimburse any legal or other expenses reasonably
incurred by them in connection with investigating or defending any such Claim;
provided, however, that the indemnity agreement contained in this Section 6(b)
and the agreement with respect to contribution contained in Section 7 shall not
apply to amounts paid in settlement of any Claim if such settlement is effected
without the prior written consent of the Investor, which consent shall not be
unreasonably withheld; provided, further, however, that the Investor shall be
liable under this Section 6(b) for only that amount of a Claim or Indemnified
Damages as does not exceed the net proceeds to the Investor as a result of the
sale of Registrable Securities pursuant to such registration
statement.  Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of such Indemnified Party
and shall survive the transfer of the Registrable Securities by the Investor
pursuant to Section 9.

    

    c.           Promptly
after receipt by an Indemnified Person or Indemnified Party under this Section 6
of notice of the commencement of any action or proceeding (including any
governmental action or proceeding) involving a Claim, such Indemnified Person or
Indemnified Party shall, if a Claim in respect thereof is to be made against any
indemnifying party under this Section 6, deliver to the indemnifying party a
written notice of the commencement thereof, and the indemnifying party shall
have the right to participate in, and, to the extent the indemnifying party so
desires, jointly with any other indemnifying party similarly noticed, to assume
control of the defense thereof with counsel mutually satisfactory to the
indemnifying party and the Indemnified Person or the Indemnified Party, as the
case may be; provided, however, that an Indemnified Person or Indemnified Party
shall have the right to retain its own counsel with the fees and expenses to be
paid by the indemnifying party, if, in the reasonable opinion of counsel
retained by the indemnifying party, the representation by such counsel of the
Indemnified Person or Indemnified Party and the indemnifying party would be
inappropriate due to actual or potential differing interests between such
Indemnified Person or Indemnified Party and any other party represented by such
counsel in such proceeding. The Indemnified Party or Indemnified Person shall
cooperate fully with the indemnifying party in connection with any negotiation
or defense of any such action or claim by the indemnifying party and shall
furnish to the indemnifying party all information reasonably available to the
Indemnified Party or Indemnified Person which relates to such action or
claim.  The indemnifying party shall keep the Indemnified Party or
Indemnified Person fully apprised at all times as to the status of the defense
or any settlement negotiations with respect thereto.  No indemnifying
party shall be liable for any settlement of any action, claim or proceeding
effected without its written consent, provided, however, that the indemnifying
party shall not unreasonably withhold, delay or condition its
consent.  No indemnifying party shall, without the consent of the
Indemnified Party or Indemnified Person, consent to entry of any judgment or
enter into any settlement or other compromise which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
Indemnified Party or Indemnified Person of a release from all liability in
respect to such claim or litigation.  Following indemnification as
provided for hereunder, the indemnifying party shall be subrogated to all rights
of the Indemnified Party or Indemnified Person with respect to all third
parties, firms or corporations relating to the matter for which indemnification
has been made.  The failure to deliver written notice to the
indemnifying party within a reasonable time of the commencement of any such
action shall not relieve such indemnifying party of any liability to the
Indemnified Person or Indemnified Party under this Section 6, except to the
extent that the indemnifying party is prejudiced in its ability to defend such
action.

    

    d.           The
indemnification required by this Section 6 shall be made by periodic payments of
the amount thereof during the course of the investigation or defense, as and
when bills are received or Indemnified Damages are incurred.

    

    e.           The
indemnity agreements contained herein shall be in addition to (i) any cause of
action or similar right of the Indemnified Party or Indemnified Person against
the indemnifying party or others, and (ii) any liabilities the indemnifying
party may be subject to pursuant to the law.

    

    7.           CONTRIBUTION.

    

    To the
extent any indemnification by an indemnifying party is prohibited or limited by
law, the indemnifying party agrees to make the maximum contribution with respect
to any amounts for which it would otherwise be liable under Section 6 to the
fullest extent permitted by law; provided, however, that: (i) no seller of
Registrable Securities guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution from
any seller of Registrable Securities who was not guilty of fraudulent
misrepresentation; and (ii) contribution by any seller of Registrable Securities
shall be limited in amount to the net amount of proceeds received by such seller
from the sale of such Registrable Securities.

    

    8.           REPORTS AND DISCLOSURE UNDER
THE SECURITIES ACTS.

    

    With a
view to making available to the Investor the benefits of Rule 144 promulgated
under the 1933 Act or any other similar rule or regulation of the SEC that may
at any time permit the Investor to sell securities of the Company to the public
without registration ("Rule
144"), the Company agrees, at the Company’s sole expense,
to:

    

    a.           make
and keep public information available, as those terms are understood and defined
in Rule 144;

    

    b.           file
with the SEC in a timely manner all reports and other documents required of the
Company under the 1933 Act and the 1934 Act so long as the Company remains
subject to such requirements and the filing of such reports and other documents
is required for the applicable provisions of Rule 144; and

    

    c.           furnish
to the Investor so long as the Investor owns Registrable Securities, promptly
upon request, (i) a written statement by the Company that it has complied with
the reporting and or disclosure provisions of Rule 144, the 1933 Act and the
1934 Act, (ii) a copy of the most recent annual or quarterly report of the
Company and such other reports and documents so filed by the Company, and (iii)
such other information as may be reasonably requested to permit the Investor to
sell such securities pursuant to Rule 144 without registration.

    

    d.           take
such additional action as is requested by the Investor to enable the Investor to
sell the Registrable Securities pursuant to Rule 144, including, without
limitation, delivering all such legal opinions, consents, certificates,
resolutions and instructions to the Company’s Transfer Agent as may
be  requested from time to time by the Investor and otherwise fully
cooperate with Investor and Investor’s broker to effect such sale of securities
pursuant to Rule 144.

    

    The Company agrees that damages may be
an inadequate remedy for any breach of the terms and provisions of this Section
8 and that Investor shall, whether or not it is pursuing any remedies at law, be
entitled to equitable relief in the form of a preliminary or permanent
injunctions, without having to post any bond or other security, upon any breach
or threatened breach of any such terms or provisions.

    

    
      	
              9.  

            	
              ASSIGNMENT OF
      REGISTRATION RIGHTS.

            

    

    

    The
Company shall not assign this Agreement or any rights or obligations hereunder
without the prior written consent of the Investor, including by merger or
consolidation.  The Investor may not assign its rights under this
Agreement without the written consent of the Company, other than to an affiliate
of the Investor controlled by Steven G. Martin or Joshua B.
Scheinfeld.

    

    10.           AMENDMENT OF REGISTRATION
RIGHTS.

    

    Provisions
of this Agreement may be amended and the observance thereof may be waived
(either generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Company and the
Investor.

    

    11.           MISCELLANEOUS.

    

    a.           A
Person is deemed to be a holder of Registrable Securities whenever such Person
owns or is deemed to own of record such Registrable Securities.  If
the Company receives conflicting instructions, notices or elections from two or
more Persons with respect to the same Registrable Securities, the Company shall
act upon the basis of instructions, notice or election received from the
registered owner of such Registrable Securities.

    

    b.           Any
notices, consents, waivers or other communications required or permitted to be
given under the terms of this Agreement 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) 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 the
Company:

    DOR BioPharma, Inc.

    850 Bear Tavern Road, Suite
201

    Ewing, New Jersey 08628

    Telephone: 609-538-8200

    Facsimile:: 609-538-8205

    Attention:   Chief
Executive Officer

    

    With a
copy to:

    Edwards Angell Palmer & Dodge
LLP

    350 East Las Olas Boulevard, Suite
1150

    Fort Lauderdale, FL 33301

    Telephone:          954-727-2600

    Facsimile:                        
954-727-2601

    Attention:                       
Leslie J. Croland

    

    If to the
Holder:

         Fusion
Capital Fund II, LLC

                    
222
Merchandise Mart Plaza, Suite 9-112

                    
Chicago,
IL 60654

                    
Telephone:                   312-644-6644

                    
Facsimile:                      312-644-6244

                    
Attention:                     Steven
G. Martin

    

    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 (A) given by the recipient of
such notice, consent, waiver or other communication, (B) 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 (C) 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.

    

    c.           Failure
of any party to exercise any right or remedy under this Agreement or otherwise,
or delay by a party in exercising such right or remedy, shall not operate as a
waiver thereof.

    

    d.           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
Illinois, without giving effect to any choice of law or conflict of law
provision or rule (whether of the State of Illinois or any other jurisdictions)
that would cause the application of the laws of any jurisdictions other than the
State of Illinois.   Each party hereby irrevocably submits to the
exclusive jurisdiction of the state and federal courts sitting the City of
Chicago, for the adjudication of any dispute hereunder or in connection herewith
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.  If any provision of this Agreement
shall be invalid or unenforceable in any jurisdiction, such invalidity or
unenforceability shall not affect the validity or enforceability of the
remainder of this Agreement in that jurisdiction or the validity or
enforceability of any provision of this Agreement in any other
jurisdiction.  EACH
PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO
REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN
CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION
CONTEMPLATED HEREBY.

    

    e.           This
Agreement, and the Purchase  Agreement constitute the entire agreement
among the parties hereto with respect to the subject matter hereof and
thereof.  There are no restrictions, promises, warranties or
undertakings, other than those set forth or referred to herein and
therein.  This Agreement and the Purchase Agreement supersede all
prior agreements and understandings among the parties hereto with respect to the
subject matter hereof and thereof.

    

    f.           Subject
to the requirements of Section 9, this Agreement shall inure to the benefit of
and be binding upon the permitted successors and assigns of each of the parties
hereto.

    

    g.           The
headings in this Agreement are for convenience of reference only and shall not
limit or otherwise affect the meaning hereof.

    

    h.           This
Agreement may be executed in identical counterparts, each of which shall be
deemed an original but all of which shall constitute one and the same
agreement.  This Agreement, once executed by a party, may be delivered
to the other party hereto by facsimile transmission of a copy of this Agreement
bearing the signature of the party so delivering this Agreement.

    

    i.           Each
party shall do and perform, or cause to be done and performed, all such further
acts and things, and shall execute and deliver all such other agreements,
certificates, instruments and documents, as the other party may reasonably
request in order to carry out the intent and accomplish the purposes of this
Agreement and the consummation of the transactions contemplated
hereby.

    

    j.           The
language used in this Agreement will be deemed to be the language chosen by the
parties to express their mutual intent and no rules of strict construction will
be applied against any party.

    

    k.           This
Agreement is intended for the benefit of the parties hereto and their respective
permitted successors and assigns, and is not for the benefit of, nor may any
provision hereof be enforced by, any other Person.

    

    

    

    * * * * * *

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    

    IN WITNESS WHEREOF, the
parties have caused this Registration Rights Agreement to be duly executed as of
day and year first above written.

    

    

    

    THE
COMPANY:

    

    DOR
BioPharma, Inc.

    
 

    
                                      By:  /s/ Christopher J.
Schaber_

                                      Name:  
Christopher J. Schaber

                                      Title:   President
and C.E.O.

    

    BUYER:

    
 

    
      Fusion
Capital Fund II, LLC

      By:
Fusion Capital Partners, LLC

      By:
Rockledge Capital Corporation

       

    

    
      By: 
/s/ Josh
Scheinfeld

      Name:  
Josh Scheinfeld

      Title:    
President

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    EXHIBIT
A

    TO REGISTRATION RIGHTS
AGREEMENT

    

                                                 
FORM OF NOTICE OF EFFECTIVENESS

    OF
REGISTRATION STATEMENT

    

    

    

    

    

    

    _________,
2008

    

    

    [TRANSFER
AGENT]

    ________________

    ________________

    Attention:
___________

    

    RE:
DOR BioPharma, Inc.

    

    

    Ladies
and Gentlemen:

    

    We are
counsel to DOR BioPharma,
Inc., a Delaware corporation (the “Company”), and have
represented the Company in connection with that certain Common Stock Purchase
Agreement, dated as of ____________, (the “Purchase Agreement”), entered
into by and between the Company and Fusion Capital Fund II, LLC (the “Buyer”) pursuant to which the
Company has agreed to issue to the Buyer shares of the Company's Common Stock,
$0.001 par value (the “Common
Stock”), in an amount up to Eight Million Five Hundred Thousand
($8,500,000), in accordance with the terms of the Purchase Agreement. In
connection with the transactions contemplated by the Purchase Agreement, the
Company has registered with the U.S. Securities & Exchange Commission the
following shares of Common Stock:

    

    (1)      _______________
shares of Common Stock to be issued upon purchase from the Company by the Buyer
from time to time (the “Purchase
Shares.”).

    

    (2) 4,052,778
shares of Common Stock previously issued to the Buyer (the “Initial  Shares.”).

    

    (3)           1,275,000
additional Commitment Shares to be issued in connection with each purchase of
Purchase Shares (the “Additional Commitment
Shares”).

    

    [(4)           1,388,889
shares of Common Stock underlying warrants issued to the Buyer to purchase
shares of Common Stock (the “Warrant Shares”).]  [If
applicable]

    

    Pursuant to the Purchase Agreement,
the Company also has entered into a Registration Rights Agreement, dated as of
___________, with the Buyer (the “Registration Rights
Agreement”) pursuant to which the Company agreed, among other things, to
register the Purchase Shares, the Initial Shares, the Additional Commitment
Shares [and the Warrant
Shares] under the Securities Act of 1933, as amended (the “1933 Act”).  In
connection with the Company's obligations under the Purchase Agreement and the
Registration Rights Agreement, on _______, the Company filed a Registration
Statement (File No. 333-_________) (the “Registration Statement”) with
the Securities and Exchange Commission (the “SEC”) relating to the sale of
the Purchase Shares, the Initial Shares and the Additional
Commitment Shares [and the
Warrant Shares].

    

    In
connection with the foregoing, we advise you that: (1) a member of the SEC's
staff has advised us by telephone that the SEC has entered an order declaring
the Registration Statement effective under the 1933 Act at _____ P.M. on
__________, 2007, (2) we have no knowledge, after telephonic inquiry of a member
of the SEC's staff, that any stop order suspending its effectiveness has been
issued or that any proceedings for that purpose are pending before, or
threatened by, the SEC, (3) the Initial Shares [and the Warrant Shares] are
available for sale under the 1933 Act pursuant to the Registration Statement and
the restrictive legend on the Initial Shares [and the Warrant Shares] shall
be removed and (4) the Purchase Shares and the Additional Commitment Shares
[and the Warrant Shares]
are available for sale under the 1933 Act pursuant to the Registration Statement
and shall be issued without any restrictive legend.

    

    

    

    Very
truly yours,

    

    [Company Counsel]

    

    

    By:____________________

    

    

    

    

    

    CC:             Fusion
Capital Fund II, LLC

    

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    

    EXHIBIT
B

    

    TO REGISTRATION RIGHTS
AGREEMENT

    

    Information
About The Investor Furnished To The Company By The Investor

    Expressly
For Use In Connection With The Registration Statement

    

    

    As of the
date of the Purchase Agreement, Fusion Capital beneficially owned no shares of
common stock of the Company.  Steven G. Martin and Joshua B.
Scheinfeld, the principals of Fusion Capital, are deemed to be beneficial owners
of all of the shares of common stock owned by Fusion Capital.  Messrs.
Martin and Scheinfeld have shared voting and investment power over the shares
being offered under the prospectus filed with the SEC in connection with the
transactions contemplated under the Purchase Agreement.  Fusion
Capital is not a licensed broker dealer or an affiliate of a licensed broker
dealer.

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