Document:

Exhibit 4.1

              INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE
  NUMBER                                                          SHARES
   XXXX            ELITE PHARMACEUTICALS, INC.                     XXXX
   ----                                                            ----
             SERIES D 8% CONVERTIBLE PREFERRED STOCK       SEE REVERSE SIDE FOR
                                                         CERTAIN DEFINITIONS AND
                                                                  LEGENDS

         150,000,000 SHARES OF COMMON STOCK - PAR VALUE $0.01 PER SHARE

         4,483,442 SHARES OF PREFERRED STOCK - PAR VALUE $0.01 PER SHARE

                                *S*P*E*C*I*M*E*N

THIS IS TO CERTIFY  XXXX,  IS THE OWNER OF XXXX  FULLY  PAID AND  NON-ASSESSABLE
SHARES OF SERIES D 8% CONVERTIBLE PREFERRED STOCK, PAR VALUE $0.01 PER SHARE, OF
THE ABOVE CORPORATION TRANSFERABLE ON THE BOOKS OF THE CORPORATION BY THE HOLDER
HEREOF  IN  PERSON  OR BY  DULY  AUTHORIZED  ATTORNEY,  UPON  SURRENDER  OF THIS
CERTIFICATE, PROPERLY ENDORSED.

WITNESS,  THE SEAL OF THE  CORPORATION AND THE SIGNATURES OF ITS DULY AUTHORIZED
OFFICERS.

DATED: XXXX

           XXXX                                                     XXXX
           ----                                                     ----
         SECRETARY                                                PRESIDENT

<PAGE>

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

TEN COM --as tenants in common
TEN ENT --as tenants by the entireties
JT TEN  --as joint tenants with right of
          survivorship and not as tenants in common

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

FOR VALUE RECEIVED __ HEREBY SELL, ASSIGN AND TRANSFER UNTO

    Please insert social security or
      other identifying number of
                assignee
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          (Please print or typewrite name and address including postal
                              zip code of Assignee)

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SHARES  REPRESENTED  BY  THE  WITHIN  CERTIFICATE,  AND  DO  HEREBY  IRREVOCABLY
CONSTITUTE AND APPOINT ___________________________ ATTORNEY TO TRANSFER THE SAID
SHARES  ON THE  BOOKS  OF THE  WITHIN  NAMED  CORPORATION  WITH  FULL  POWER  OF
SUBSTITUTION IN THE PREMISES.

DATED: _______

       IN PRESENCE OF _______

THE SECURITIES  REPRESENTED BY THIS CERTIFICATE  (AND/OR THE SECURITIES ISSUABLE
UPON  CONVERSION  OR  EXERCISE  HEREOF)  HAVE  NOT  BEEN  REGISTERED  UNDER  THE
SECURITIES  ACT OF 1933,  AS AMENDED  (THE  "SECURITIES  ACT") OR WITH ANY STATE
SECURITIES  COMMISSION,  AND MAY NOT BE TRANSFERRED OR DISPOSED OF BY THE HOLDER
IN THE  ABSENCE  OF A  REGISTRATION  STATEMENT  WHICH  IS  EFFECTIVE  UNDER  THE
SECURITIES ACT AND  APPLICABLE  STATE LAWS AND RULES,  OR,  UNLESS,  IMMEDIATELY
PRIOR  TO THE TIME SET FOR  TRANSFER,  SUCH  TRANSFER  MAY BE  EFFECTED  WITHOUT
VIOLATION  OF THE  SECURITIES  ACT AND OTHER  APPLICABLE  STATE  LAWS AND RULES.
NOTWITHSTANDING  THE FOREGOING,  THE SECURITIES (AND/OR THE SECURITIES  ISSUABLE
UPON  CONVERSION OR EXERCISE  HEREOF) MAY BE PLEDGED IN  CONNECTION  WITH A BONA
FIDE  MARGIN  ACCOUNT  OR OTHER  LOAN OR  FINANCING  ARRANGEMENT  SECURED BY THE
SECURITIES (AND/OR THE SECURITIES ISSUABLE UPON CONVERSION OR EXERCISE HEREOF).

THE CORPORATION WILL FURNISH WITHOUT CHARGE TO EACH STOCKHOLDER WHO SO REQUESTS,
THE POWERS,  DESIGNATIONS,  PREFERENCES AND RELATIVE PARTICIPATING,  OPTIONAL OR
OTHER  SPECIAL  RIGHTS  OF  EACH  CLASS  OF  STOCK  OR  SERIES  THEREOF  AND THE
QUALIFICATIONS, LIMITATIONS, OR RESTRICTIONS OF SUCH PREFERENCES AND/OR RIGHTS.Exhibit 4.2

NEITHER THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS EXERCISABLE
HAVE  BEEN  REGISTERED  WITH  THE  SECURITIES  AND  EXCHANGE  COMMISSION  OR THE
SECURITIES   COMMISSION  OF  ANY  STATE  IN  RELIANCE  UPON  AN  EXEMPTION  FROM
REGISTRATION  UNDER THE  SECURITIES  ACT OF 1933,  AS AMENDED  (THE  "SECURITIES
ACT"),  AND,  ACCORDINGLY,  MAY NOT BE OFFERED  OR SOLD  EXCEPT  PURSUANT  TO AN
EFFECTIVE  REGISTRATION  STATEMENT  UNDER THE  SECURITIES  ACT OR PURSUANT TO AN
AVAILABLE  EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE  REGISTRATION
REQUIREMENTS  OF THE  SECURITIES  ACT AND IN ACCORDANCE  WITH  APPLICABLE  STATE
SECURITIES  LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO
SUCH  EFFECT,  THE  SUBSTANCE  OF WHICH SHALL BE  REASONABLY  ACCEPTABLE  TO THE
COMPANY.  THIS  SECURITY  AND THE  SECURITIES  ISSUABLE  UPON  EXERCISE  OF THIS
SECURITY MAY BE PLEDGED IN CONNECTION  WITH A BONA FIDE MARGIN  ACCOUNT OR OTHER
LOAN SECURED BY SUCH SECURITIES.

                          COMMON STOCK PURCHASE WARRANT

                To Purchase __________ Shares of Common Stock of

                           ELITE PHARMACEUTICALS, INC.

         THIS COMMON STOCK PURCHASE WARRANT (the "WARRANT")  certifies that, for
value received,  _____________ (the "HOLDER"),  is entitled,  upon the terms and
subject to the limitations on exercise and the conditions hereinafter set forth,
at any time on or after the Initial  Exercise Date (as defined in Section 2) and
on or  prior  to the  close  of  business  on the  later  of the  five  (5) year
anniversary  of (a)  the  Initial  Exercise  Date  and (b) the  date  that  both
Shareholder  Approval  and  Authorized  Share  Approval  (both as defined in the
Purchase  Agreement) have been obtained and deemed effective if such date occurs
after January 31, 2009 (the "TERMINATION DATE") but not thereafter, to subscribe
for and purchase from Elite  Pharmaceuticals,  Inc., a Delaware corporation (the
"COMPANY"),  up to ______  shares (the "WARRANT  SHARES") of Common  Stock,  par
value $.01 per share, of the Company (the "COMMON STOCK"). The purchase price of
one share of Common  Stock  under this  Warrant  shall be equal to the  Exercise
Price, as defined in Section 2(b).

         SECTION  1.  DEFINITIONS.  Capitalized  terms  used  and not  otherwise
defined  herein shall have the  meanings  set forth in that  certain  Securities
Purchase Agreement (the "PURCHASE  AGREEMENT"),  dated September 15, 2008, among
the Company and the purchasers signatory thereto.

         SECTION 2. EXERCISE.

                    (a)  EXERCISE OF WARRANT.  Exercise of the  purchase  rights
represented  by this  Warrant may be made,  in whole or in part,  at any time or
times on or after  the date of issue  of this  Warrant  (the  "INITIAL  EXERCISE
DATE") and on or before the  Termination  Date by  delivery  to the Company of a
duly executed  facsimile  copy of the Notice of Exercise Form annexed hereto (or
such  other  office or agency of the  Company as it may  designate  by notice in
writing to the

<PAGE>

registered  Holder at the address of such Holder  appearing  on the books of the
Company); and, within three (3) Trading Days of the date said Notice of Exercise
is delivered to the Company,  the Holder shall have  surrendered this Warrant to
the  Company  and the  Company  shall have  received  payment  of the  aggregate
Exercise  Price of the shares  thereby  purchased by wire  transfer or cashier's
check drawn on a United  States  bank.  Notwithstanding  anything  herein to the
contrary,  the Holder shall not be required to physically surrender this Warrant
to the  Company  until  the  Holder  has  purchased  all of the  Warrant  Shares
available  hereunder and the Warrant has been  exercised in full, in which case,
the Holder shall surrender this Warrant to the Company for cancellation within 3
Trading  Days of the date the  final  Notice of  Exercise  is  delivered  to the
Company.  Partial  exercises of this Warrant resulting in purchases of a portion
of the total number of Warrant Shares available  hereunder shall have the effect
of lowering the outstanding number of Warrant Shares purchasable hereunder in an
amount equal to the applicable  number of Warrant Shares  purchased.  The Holder
and the Company  shall  maintain  records  showing the number of Warrant  Shares
purchased  and  the  date of such  purchases.  The  Company  shall  deliver  any
objection to any Notice of Exercise  Form within one (1) Business Day of receipt
of such notice.  In the event of any dispute or discrepancy,  the records of the
Holder shall be controlling and  determinative in the absence of manifest error.
THE HOLDER AND ANY ASSIGNEE,  BY ACCEPTANCE  OF THIS  WARRANT,  ACKNOWLEDGE  AND
AGREE  THAT,  BY REASON  OF THE  PROVISIONS  OF THIS  PARAGRAPH,  FOLLOWING  THE
PURCHASE OF A PORTION OF THE  WARRANT  SHARES  HEREUNDER,  THE NUMBER OF WARRANT
SHARES  AVAILABLE FOR PURCHASE  HEREUNDER AT ANY GIVEN TIME MAY BE LESS THAN THE
AMOUNT STATED ON THE FACE HEREOF.

                    (b)  EXERCISE  PRICE.  The  exercise  price per share of the
Common  Stock  under  this  Warrant  shall be  US$0.25,  subject  to  adjustment
hereunder (the "EXERCISE PRICE").

                    (c) CASHLESS  EXERCISE.  If at any time after the earlier of
(i) the one year anniversary of the date of the Purchase  Agreement and (ii) the
completion of the  then-applicable  holding period  required by Rule 144, or any
successor provision then in effect, there is no effective Registration Statement
registering,  or no current  prospectus  available for, the resale of all of the
Warrant  Shares by the Holder,  then this  Warrant may also be exercised at such
time by means of a "cashless  exercise" in which the Holder shall be entitled to
receive a  certificate  for the number of Warrant  Shares  equal to the quotient
obtained by dividing [(A-B) (X)] by (A), where:

                         A     =  the  VWAP  on  the  Trading  Day   immediately
                               preceding the date of such election;

                         B     =  the  Exercise   Price  of  this  Warrant,   as
                               adjusted; and

                         X     = the  number of  Warrant  Shares  issuable  upon
                               exercise of this Warrant in  accordance  with the
                               terms of this Warrant by means of a cash exercise
                               rather than a cashless exercise.

Notwithstanding this anything to the contrary contained in this Section 2(c), to
the extent that there is an effective  Registration  Statement  registering,  or
current  prospectus  available  for,  the resale of any  portion of the  Warrant
Shares by the Holder,  then this  Warrant  must be  exercised  as to the Warrant
Shares issuable upon exercise of this Warrant that are registered pursuant to an

                                       2
<PAGE>

effective  Registration  Statement or eligible for resale  pursuant to a current
prospectus, if any, by the Holder for cash pursuant to Section 2(a) hereof prior
to any exercise of this Warrant by means of "cashless  exercise" as described in
this Section 2(c).

                    (d) EXERCISE LIMITATIONS.

                        (i) HOLDER'S RESTRICTIONS.  The Company shall not effect
any exercise of this Warrant,  and a Holder shall not have the right to exercise
any portion of this  Warrant,  pursuant  to Section  2(c) or  otherwise,  to the
extent that after giving effect to such issuance  after exercise as set forth on
the  applicable  Notice of  Exercise,  the Holder  (together  with the  Holder's
Affiliates,  and any other person or entity acting as a group  together with the
Holder or any of the Holder's Affiliates), as set forth on the applicable Notice
of  Exercise,  would  beneficially  own in  excess of the  Beneficial  Ownership
Limitation  (as defined  below).  For purposes of the  foregoing  sentence,  the
number of  shares  of Common  Stock  beneficially  owned by the  Holder  and its
Affiliates  shall  include the number of shares of Common  Stock  issuable  upon
exercise of this Warrant with respect to which such determination is being made,
but shall  exclude the number of shares of Common  Stock which would be issuable
upon (A)  exercise  of the  remaining,  non-exercised  portion  of this  Warrant
beneficially  owned by the Holder or any of its  Affiliates  and (B) exercise or
conversion of the unexercised or  non-converted  portion of any other securities
of the Company  (including,  without  limitation,  any other  preferred stock or
warrants)  subject to a limitation on  conversion  or exercise  analogous to the
limitation  contained  herein  beneficially  owned by the  Holder  or any of its
affiliates.  Except as set forth in the preceding sentence, for purposes of this
Section  2(d)(i),  beneficial  ownership  shall be calculated in accordance with
Section  13(d) of the  Exchange  Act and the rules and  regulations  promulgated
thereunder,  it  being  acknowledged  by  a  Holder  that  the  Company  is  not
representing  to the Holder that such  calculation is in compliance with Section
13(d) of the Exchange Act and the Holder is solely responsible for any schedules
required to be filed in accordance therewith.  To the extent that the limitation
contained  in this  Section  2(d)  applies,  the  determination  of whether this
Warrant is  exercisable  (in  relation to other  securities  owned by the Holder
together  with  any  Affiliates)  and of  which a  portion  of this  Warrant  is
exercisable shall be in the sole discretion of a Holder, and the submission of a
Notice of Exercise shall be deemed to be each Holder's  determination of whether
this Warrant is exercisable (in relation to other securities owned by the Holder
together  with  any  Affiliates)  and  of  which  portion  of  this  Warrant  is
exercisable,  in each case subject to such aggregate percentage limitation,  and
the Company  shall have no  obligation to verify or confirm the accuracy of such
determination.   In  addition,  a  determination  as  to  any  group  status  as
contemplated  above shall be determined in accordance  with Section 13(d) of the
Exchange Act and the rules and regulations promulgated thereunder.  For purposes
of this Section 2(d), in determining the number of outstanding  shares of Common
Stock, a Holder may rely on the number of outstanding  shares of Common Stock as
reflected in (x) the  Company's  most recent Form 10-Q or Form 10-K, as the case
may be, (y) a more recent  public  announcement  by the Company or (z) any other
notice by the Company or the Company's  Transfer  Agent setting forth the number
of shares of Common  Stock  outstanding.  Upon the written or oral  request of a
Holder,  the Company  shall within two (2) Trading  Days  confirm  orally and in
writing to the Holder the number of shares of Common Stock then outstanding.  In
any case, the number of  outstanding  shares of Common Stock shall be determined
after giving effect to the  conversion or exercise of securities of the Company,
including  this Warrant,  by the Holder or its  Affiliates  since the date as of
which such number of outstanding shares of Common Stock was reported.

                                       3
<PAGE>

The "BENEFICIAL  OWNERSHIP LIMITATION" shall be 4.99% of the number of shares of
the Common Stock outstanding  immediately after giving effect to the issuance of
shares of Common Stock  issuable upon exercise of this Warrant.  The  Beneficial
Ownership  Limitation  provisions  of this Section  2(d)(i) may be waived by the
Holder,  at the election of the Holder,  upon not less than sixty-one (61) days'
prior notice to the Company to change the  Beneficial  Ownership  Limitation  to
9.99% of the number of shares of the Common Stock outstanding  immediately after
giving  effect to the issuance of shares of Common  Stock upon  exercise of this
Warrant,  and the provisions of this Section 2(d) shall continue to apply.  Upon
such a change by a Holder of the Beneficial Ownership Limitation from such 4.99%
limitation to such 9.99% limitation, the Beneficial Ownership Limitation may not
be further  waived by the Holder.  The  provisions  of this  paragraph  shall be
construed and implemented in a manner  otherwise than in strict  conformity with
the terms of this  Section  2(d)(i) to correct  this  paragraph  (or any portion
hereof)  which may be defective  or  inconsistent  with the intended  Beneficial
Ownership  Limitation  herein  contained  or  to  make  changes  or  supplements
necessary  or  desirable  to  properly  give  effect  to  such  limitation.  The
limitations  contained in this  paragraph  shall apply to a successor  holder of
this Warrant.

                        (ii) TRADING MARKET RESTRICTIONS. If the Company has not
obtained Shareholder  Approval,  then the Company may not issue upon exercise of
this Warrant a number of shares of Common Stock, which, when aggregated with any
shares of Common Stock issued (A) upon  conversion of or as payment of dividends
on the Series D Preferred Stock issued pursuant to the Purchase  Agreement,  (B)
upon prior exercise of this or any other Warrant issued pursuant to the Purchase
Agreement   and  (C)  pursuant  to  any  warrants   issued  to  any   registered
broker-dealer  as a fee  in  connection  with  the  Securities  pursuant  to the
Purchase Agreement, would exceed 19.999% of the number of shares of Common Stock
outstanding  on the Trading Day  immediately  preceding  the Closing  Date (such
number of shares,  the "ISSUABLE  MAXIMUM") If on any attempted exercise of this
Warrant,  the issuance of Warrant  Shares would exceed the Issuable  Maximum and
the Company shall not have previously obtained  Shareholder  Approval,  then the
Company shall issue to the Holder  requesting a Warrant  exercise such number of
Warrant Shares as may be issued below the Issuable  Maximum and, with respect to
the remainder of the aggregate number of Warrant Shares,  this Warrant shall not
be exercisable  until and unless  Shareholder  Approval has been obtained.  Each
Holder  shall be  entitled  to a portion of the  Issuable  Maximum  equal to the
quotient  obtained  by  dividing  (x) such the  number  of  shares  of  Series D
Preferred Stock initially purchased by the Holder by (y) the aggregate number of
shares  purchased by all Holders.  Such portion shall be adjusted upward ratably
in the  event  all of the  shares  of  Series D  Preferred  Stock  and  Warrants
initially purchased by any Holder are no longer outstanding.  If at any time (i)
the number of shares of Common Stock which could, notwithstanding the limitation
set forth  herein,  be issued to all  Holders  during  the  following  12 months
(assuming all dividends are paid in shares of Common Stock during such period of
determination based upon the VWAP at the time of any such determination)  equals
or exceeds the Issuable  Maximum and (ii)  Shareholder  Approval  shall not have
been obtained,  then the Company shall issue to the Holder requesting exercise a
number of Warrant Shares equal to the Holder's  pro-rata portion (which shall be
calculated  pursuant  to the terms  hereof) of the  Issuable  Maximum,  and with
respect to the  remainder  of this  Warrant then held by the Holder for which an
exercise in accordance  with the  applicable  Exercise  Price would result in an
issuance of shares of Warrant Shares in excess of the Holder's  pro-rata portion
(which shall be calculated pursuant to the terms hereof) of the Issuable Maximum
(the "EXCESS WARRANTS"), the Corporation

                                       4
<PAGE>

shall be prohibited  from converting  such Excess  Warrants,  and shall promptly
notify the Holder of the reason therefore.  The Excess Warrants shall thereafter
be  unexercisable  to such  extent  until and  unless  Shareholder  Approval  is
subsequently obtained.

                        (iii) AUTHORIZED SHARE RESTRICTIONS.  If the Company has
not  obtained  Authorized  Share  Approval,  then the Company may not issue upon
exercise  of this  Warrant,  a number of shares of  Common  Stock,  which,  when
aggregated  with any shares of Common Stock issued (A) upon  conversion of or as
payment of  dividends  on the Series D Preferred  Stock  issued  pursuant to the
Purchase  Agreement  and (B) upon prior  exercise  of this or any other  Warrant
issued pursuant to the Purchase Agreement,  would exceed 87,059,562 (such number
of shares, the "SHARE APPROVAL MAXIMUM"),  subject to adjustment for reverse and
forward stock splits and the like (such number of shares,  the "AUTHORIZED SHARE
MAXIMUM"). If on any attempted exercise of this Warrant, the issuance of Warrant
Shares  would  exceed  the  Issuable  Maximum  and the  Company  shall  not have
previously obtained the Authorized Share Approval,  then the Company shall issue
to the Holder  requesting  the  exercise of the  Warrant  such number of Warrant
Shares as may be issued below the Authorized  Share Maximum and, with respect to
the remainder of the aggregate number of Warrant Shares,  this Warrant shall not
be exercisable until and unless Authorized Share Approval has been obtained. The
Holder shall be entitled to a portion of the  Authorized  Share Maximum equal to
the  quotient  obtained  by  dividing  (x) such the number of shares of Series D
Preferred Stock initially purchased by the Holder by (y) the aggregate number of
shares  purchased by all Holders.  Such portion shall be adjusted upward ratably
in the  event  all of the  shares  of  Series D  Preferred  Stock  and  Warrants
initially purchased by any Holder are no longer outstanding.  If at any time (i)
the number of shares of Common Stock which could, notwithstanding the limitation
set forth  herein,  be issued to all  Holders  during  the  following  12 months
(assuming all dividends are paid in shares of Common Stock during such period of
determination based upon the VWAP at the time of any such determination)  equals
or exceeds the Authorized  Share Maximum and (ii) the Authorized  Share Approval
shall not have been obtained and deemed  effective,  then the Corporation  shall
issue to the  Holder a number of shares of Common  Stock  equal to the  Holder's
pro-rata portion (which shall be calculated pursuant to the terms hereof) of the
Authorized  Share  Maximum,  and with  respect to the  remainder of the Series D
Preferred  Stock  (including any accrued  dividends) then held by the Holder for
which an exercise in accordance with the applicable  Exercise Price would result
in an  issuance of Warrant  Shares in excess of the  Holder's  pro-rata  portion
(which shall be calculated pursuant to the terms hereof) of the Authorized Share
Maximum  (the  "SHARE  APPROVAL  EXCESS  WARRANT"),  the  Corporation  shall  be
prohibited  from  converting  such  Share  Approval  Excess  Warrant,  and shall
promptly  notify the Holder of the reason  therefore.  The Share Approval Excess
Warrant  shall  thereafter  be  unconvertible  to such  extent  until and unless
Authorized Share Approval is subsequently obtained.

                     (e) MECHANICS OF EXERCISE.

                        (i)   AUTHORIZATION  OF  WARRANT  SHARES.   The  Company
covenants  that all Warrant  Shares which may be issued upon the exercise of the
purchase rights  represented by this Warrant will, upon exercise of the purchase
rights represented by this Warrant,  be duly authorized,  validly issued,  fully
paid and nonassessable and free from all taxes, liens and charges created by the
Company  in  respect of the issue  thereof  (other  than taxes in respect of any
transfer occurring contemporaneously with such issue).

                                       5
<PAGE>

                        (ii)   DELIVERY   OF    CERTIFICATES    UPON   EXERCISE.
Certificates for shares purchased hereunder shall be transmitted by the Transfer
Agent to the Holder by crediting  the account of the Holder's  prime broker with
the Depository  Trust Company through its Deposit  Withdrawal  Agent  Commission
("DWAC")  system if the Company is then a participant  in such system and either
(A) there is an effective  Registration  Statement  permitting the resale of the
Warrant  Shares by the Holder or (B) the shares are eligible for resale  without
volume or  manner-of-sale  limitations  pursuant to Rule 144,  and  otherwise by
physical  delivery  to the  address  specified  by the  Holder in the  Notice of
Exercise within 3 Trading Days from the delivery to the Company of the Notice of
Exercise Form,  surrender of this Warrant and payment of the aggregate  Exercise
Price as set forth above (the "WARRANT SHARE DELIVERY DATE"). This Warrant shall
be deemed to have been  exercised on the date the Exercise  Price is received by
the Company.  The Warrant Shares shall be deemed to have been issued, and Holder
or any other person so  designated  to be named  therein shall be deemed to have
become a holder of record of such  shares for all  purposes,  as of the date the
Warrant has been  exercised by payment to the Company of the Exercise  Price (or
by cashless  exercise,  if permitted)  and all taxes  required to be paid by the
Holder,  if any,  pursuant  to Section  2(e)(vi)  prior to the  issuance of such
shares, have been paid.

                        (iii)  DELIVERY OF NEW WARRANTS UPON  EXERCISE.  If this
Warrant shall have been exercised in part, the Company shall,  upon surrender of
this  Warrant  certificate,  at the  time  of  delivery  of the  certificate  or
certificates  representing  Warrant  Shares,  deliver  to  Holder a new  Warrant
evidencing  the rights of Holder to  purchase  the  unpurchased  Warrant  Shares
called for by this  Warrant,  which new Warrant  shall in all other  respects be
identical with this Warrant.

                        (iv)  RESCISSION  RIGHTS.  If the Company fails to cause
its  transfer  agent to transmit  to the Holder a  certificate  or  certificates
representing  the Warrant  Shares  pursuant  to Section  2(e)(ii) by the Warrant
Share  Delivery  Date,  then the  Holder  will  have the right to  rescind  such
exercise.

                        (v) COMPENSATION FOR BUY-IN ON FAILURE TO TIMELY DELIVER
CERTIFICATES  UPON  EXERCISE.  In addition to any other rights  available to the
Holder,  if the  Company  fails to cause its  transfer  agent to transmit to the
Holder a certificate or certificates representing the Warrant Shares pursuant to
an exercise on or before the Warrant Share Delivery Date, and if after such date
the Holder is required by its broker to purchase (in an open market  transaction
or otherwise) shares of Common Stock to deliver in satisfaction of a sale by the
Holder of the Warrant  Shares which the Holder  anticipated  receiving upon such
exercise (a "BUY-IN"),  then the Company shall (1) pay in cash to the Holder the
amount by which (x) the  Holder's  total  purchase  price  (including  brokerage
commissions, if any) for the shares of Common Stock so purchased exceeds (y) the
amount obtained by multiplying (A) the number of Warrant Shares that the Company
was required to deliver to the Holder in  connection  with the exercise at issue
times  (B) the  price  at which  the sell  order  giving  rise to such  purchase
obligation was executed,  and (2) at the option of the Holder,  either reinstate
the  portion of the Warrant and  equivalent  number of Warrant  Shares for which
such  exercise  was not honored or deliver to the Holder the number of shares of
Common Stock that would have been issued had the Company  timely  complied  with
its exercise  and delivery  obligations  hereunder.  For example,  if the Holder
purchases  Common  Stock  having a total  purchase  price of  $11,000 to cover a
Buy-In with respect to an  attempted  exercise of shares of Common Stock with an
aggregate sale price giving rise to such purchase

                                       6
<PAGE>

obligation of $10,000,  under clause (1) of the immediately  preceding  sentence
the Company shall be required to pay the Holder $1,000. The Holder shall provide
the Company  written  notice  indicating  the  amounts  payable to the Holder in
respect of the Buy-In and,  upon request of the Company,  evidence of the amount
of such loss.  Nothing  herein shall limit a Holder's  right to pursue any other
remedies  available  to it  hereunder,  at law or in equity  including,  without
limitation,  a decree of  specific  performance  and/or  injunctive  relief with
respect to the Company's  failure to timely  deliver  certificates  representing
shares of Common Stock upon exercise of the Warrant as required  pursuant to the
terms hereof.

                        (vi) NO FRACTIONAL SHARES OR SCRIP. No fractional shares
or scrip  representing  fractional  shares  shall be issued upon the exercise of
this  Warrant.  As to any fraction of a share which  Holder  would  otherwise be
entitled to purchase  upon such  exercise,  the Company  shall at its  election,
either pay a cash  adjustment  in respect  of such final  fraction  in an amount
equal to such fraction  multiplied by the Exercise Price or round up to the next
whole share.

                        (vii)   CHARGES,   TAXES  AND   EXPENSES.   Issuance  of
certificates  for Warrant  Shares shall be made without charge to the Holder for
any issue or transfer tax or other incidental expense in respect of the issuance
of such  certificate,  all of  which  taxes  and  expenses  shall be paid by the
Company,  and such certificates  shall be issued in the name of the Holder or in
such name or names as may be directed by the Holder; PROVIDED,  HOWEVER, that in
the event  certificates for Warrant Shares are to be issued in a name other than
the name of the Holder,  this Warrant  when  surrendered  for exercise  shall be
accompanied by the Assignment  Form attached hereto duly executed by the Holder;
and the  Company  may  require,  as a  condition  thereto,  the payment of a sum
sufficient to reimburse it for any transfer tax incidental thereto.

                        (viii) CLOSING OF BOOKS.  The Company will not close its
stockholder books or records in any manner which prevents the timely exercise of
this Warrant, pursuant to the terms hereof.

         SECTION 3. CERTAIN ADJUSTMENTS.

                    (a) STOCK DIVIDENDS AND SPLITS. If the Company,  at any time
while this Warrant is outstanding: (A) pays a stock dividend or otherwise make a
distribution or  distributions on shares of its Common Stock or any other equity
or equity equivalent  securities  payable in shares of Common Stock (which,  for
avoidance  of doubt,  shall not include any shares of Common Stock issued by the
Company upon exercise of this  Warrant),  (B) subdivides  outstanding  shares of
Common Stock into a larger number of shares,  (C) combines  (including by way of
reverse stock split) outstanding shares of Common Stock into a smaller number of
shares,  or (D) issues by  reclassification  of shares of the  Common  Stock any
shares of capital  stock of the Company,  then in each case the  Exercise  Price
shall be multiplied by a fraction of which the numerator  shall be the number of
shares  of  Common  Stock  (excluding   treasury  shares,  if  any)  outstanding
immediately  before such event and of which the denominator  shall be the number
of shares of Common  Stock  outstanding  immediately  after  such  event and the
number of shares issuable upon exercise of this Warrant shall be proportionately
adjusted  such that the  aggregate  Exercise  Price of this Warrant shall remain
unchanged.  Any  adjustment  made  pursuant to this  Section  3(a) shall  become
effective immediately after the record date for the determination of

                                       7
<PAGE>

stockholders  entitled to receive such dividend or distribution and shall become
effective  immediately  after the effective  date in the case of a  subdivision,
combination or re-classification.

                    (b)  SUBSEQUENT   EQUITY  SALES.   If  the  Company  or  any
Subsidiary  thereof,   as  applicable,   at  any  time  while  this  Warrant  is
outstanding,  shall sell or grant any option to  purchase,  or sell or grant any
right to reprice, or otherwise dispose of or issue (or announce any offer, sale,
grant or any option to purchase or other disposition) any Common Stock or Common
Stock Equivalents  entitling any Person to acquire shares of Common Stock, at an
effective  price per share less than the then  applicable  Conversion  Price (as
such term is defined in the Certificate of Designation of the Series D Preferred
Stock) of the Series D Preferred Stock (such lower price, the "BASE SHARE PRICE"
and such issuances  collectively,  a "DILUTIVE  ISSUANCE") (if the holder of the
Common Stock or Common Stock Equivalents so issued shall at any time, whether by
operation of purchase price adjustments, reset provisions,  floating conversion,
exercise or exchange prices or otherwise, or due to warrants,  options or rights
per share  which are issued in  connection  with such  issuance,  be entitled to
receive  shares of Common  Stock at an  effective  price per share which is less
than the Exercise Price, such issuance shall be deemed to have occurred for less
than the  Exercise  Price on such  date of the  Dilutive  Issuance),  then,  the
Exercise  Price shall be reduced and only reduced to equal the Base Share Price.
Notwithstanding  the  foregoing,  no adjustments  shall be made,  paid or issued
under this  Section  3(b) in respect of an Exempt  Issuance.  The Company  shall
notify the Holder,  in writing,  no later than the  Trading  Day  following  the
issuance of any Common Stock or Common Stock Equivalents subject to this Section
3(b),  indicating  therein the applicable  issuance price,  or applicable  reset
price,  exchange price,  conversion  price and other pricing terms (such notice,
the "DILUTIVE ISSUANCE NOTICE").  For purposes of clarification,  whether or not
the Company  provides a Dilutive  Issuance Notice pursuant to this Section 3(b),
upon the  occurrence of any Dilutive  Issuance,  after the date of such Dilutive
Issuance the Holder is entitled to receive a number of Warrant Shares based upon
the Base Share Price regardless of whether the Holder  accurately  refers to the
Base Share Price in the Notice of Exercise.

                    (c) SUBSEQUENT RIGHTS OFFERINGS. If the Company, at any time
while the Warrant is outstanding, shall issue rights, options or warrants to all
holders of Common Stock (and not to Holders)  entitling them to subscribe for or
purchase  shares of Common  Stock at a price per share less than the VWAP at the
record date  mentioned  below,  then the Exercise Price shall be multiplied by a
fraction,  of which the denominator shall be the sum of the (i) number of shares
of Common Stock issued and  outstanding  on the date of issuance of such rights,
options or warrants  plus (ii) number of shares of Common  Stock  issuable  upon
conversion or exercise of Common Stock Equivalents issued and outstanding on the
date of  issuance  of such  rights,  options or  warrants  plus (iii)  number of
additional  shares of Common Stock offered for subscription or purchase,  and of
which the  numerator  shall be the sum of the (x) number of shares of the Common
Stock issued and outstanding on the date of issuance of such rights,  options or
warrants plus (y) number of shares of Common Stock  issuable upon  conversion or
exercise  of Common  Stock  Equivalents  issued and  outstanding  on the date of
issuance of such rights, options or warrants plus (z) number of shares which the
aggregate  offering  price of the total  number of shares so  offered  (assuming
receipt by the Company in full of all  consideration  payable  upon  exercise of
such rights,  options or warrants)  would purchase at such VWAP. Such adjustment
shall be made  whenever  such rights or warrants  are issued,  and shall  become
effective   immediately   after  the  record  date  for  the   determination  of
stockholders entitled to

                                       8
<PAGE>

receive  such  rights,  options  or  warrants.  If any such  rights,  options or
warrants  expire without having been  exercised,  the Exercise Price as adjusted
upon the issuance of such rights, options or warrants shall be readjusted to the
Exercise  Price which would have been in effect had an  adjustment  been made on
the  basis  that only  additional  shares  of  Common  Stock so issued  were the
additional  shares  of  Common  Stock,  if any,  actually  issued or sold on the
exercise of such  rights,  options or  warrants  and such  additional  shares of
Common  Stock,  if any,  were  issued  or sold  for the  consideration  actually
received by the Corporation upon such exercise, plus the consideration,  if any,
actually  received  by the  Corporation  for the  granting  of all such  rights,
options or warrants,  whether or not exercised,  provided that such readjustment
shall not apply to prior exercises of the Warrant.

                    (d) PRO  RATA  DISTRIBUTIONS.  If the  Company,  at any time
prior to the Termination  Date,  shall distribute to all holders of Common Stock
(and not to Holders of the  Warrants)  evidences of its  indebtedness  or assets
(including  cash and cash  dividends)  or rights or warrants to subscribe for or
purchase  any  security  other than the Common  Stock (which shall be subject to
Section  3(b)),  then in each such case the Exercise  Price shall be adjusted by
multiplying  the Exercise Price in effect  immediately  prior to the record date
fixed for determination of stockholders entitled to receive such distribution by
a  fraction  of which the  denominator  shall be the VWAP  determined  as of the
record date mentioned  above,  and of which the numerator  shall be such VWAP on
such record  date less the then per share fair market  value at such record date
of the  portion  of such  assets or  evidence  of  indebtedness  so  distributed
applicable  to one  outstanding  share of the Common Stock as  determined by the
Board of  Directors  in good  faith.  In either  case the  adjustments  shall be
described  in a  statement  provided  to the Holder of the  portion of assets or
evidences of indebtedness so distributed or such subscription  rights applicable
to one share of Common Stock.  Such  adjustment  shall be made whenever any such
distribution  is made and shall become  effective  immediately  after the record
date mentioned above.

                    (e)  FUNDAMENTAL  TRANSACTION.  If, at any time  while  this
Warrant is outstanding,  (i) the Company effects any merger or  consolidation of
the Company with or into another  Person,  (ii) the Company  effects any sale of
all  or  substantially  all  of  its  assets  in  one  or a  series  of  related
transactions,  (iii) any tender offer or exchange  offer (whether by the Company
or another  Person) is completed  pursuant to which  holders of Common Stock are
permitted  to tender or  exchange  their  shares for other  securities,  cash or
property or (iv) the Company effects any reclassification of the Common Stock or
any compulsory share exchange  pursuant to which the Common Stock is effectively
converted  into or  exchanged  for  other  securities,  cash or  property  (each
"FUNDAMENTAL Transaction"),  then, upon any subsequent exercise of this Warrant,
the Holder shall have the right to receive,  for each  Warrant  Share that would
have been  issuable upon such exercise  immediately  prior to the  occurrence of
such  Fundamental  Transaction,  the  number of  shares  of Common  Stock of the
successor or acquiring  corporation  or of the Company,  if it is the  surviving
corporation,  and any additional  consideration (the "ALTERNATE  CONSIDERATION")
receivable as a result of such merger, consolidation or disposition of assets by
a holder of the  number of shares of  Common  Stock for which  this  Warrant  is
exercisable  immediately prior to such event. For purposes of any such exercise,
the determination of the Exercise Price shall be appropriately adjusted to apply
to such Alternate  Consideration based on the amount of Alternate  Consideration
issuable  in  respect  of  one  share  of  Common  Stock  in  such   Fundamental
Transaction, and the Company shall apportion the Exercise Price among the

                                       9
<PAGE>

Alternate  Consideration in a reasonable manner reflecting the relative value of
any different  components of the Alternate  Consideration.  If holders of Common
Stock are given any choice as to the securities, cash or property to be received
in a Fundamental Transaction,  then the Holder shall be given the same choice as
to the  Alternate  Consideration  it receives  upon any exercise of this Warrant
following such  Fundamental  Transaction.  To the extent necessary to effectuate
the foregoing  provisions,  any successor to the Company or surviving  entity in
such Fundamental  Transaction shall issue to the Holder a new warrant consistent
with the foregoing provisions and evidencing the Holder's right to exercise such
warrant into  Alternate  Consideration.  The terms of any agreement  pursuant to
which a Fundamental  Transaction is effected  shall include terms  requiring any
such successor or surviving entity to comply with the provisions of this Section
3(e) and insuring that this Warrant (or any such  replacement  security) will be
similarly  adjusted upon any subsequent  transaction  analogous to a Fundamental
Transaction.  Notwithstanding  anything  to  the  contrary,  in the  event  of a
Fundamental  Transaction that is (1) an all cash transaction,  (2) a "Rule 13e-3
transaction"  as  defined  in  Rule  13e-3  under  the  Exchange  Act,  or (3) a
Fundamental  Transaction  involving  a person or entity not traded on a national
securities exchange,  the Nasdaq Global Select Market, the Nasdaq Global Market,
or the Nasdaq Capital Market,  the Company or any successor entity shall pay, at
the Holder's option, exercisable at any time concurrently with or within 30 days
after the consummation of the Fundamental  Transaction,  an amount of cash equal
to the value of this Warrant as determined in accordance  with the Black Scholes
Option Pricing Model obtained from the "OV" function on Bloomberg L.P. using (A)
a price per share of Common  Stock equal to the VWAP of the Common Stock for the
Trading Day  immediately  preceding the date of  consummation  of the applicable
Fundamental  Transaction,  (B) the risk-free  interest rate corresponding to the
U.S.  Treasury rate for a period equal to the remaining  term of this Warrant as
of the date of consummation of the applicable  Fundamental  Transaction,  (C) an
expected  volatility  equal to the 100 day  volatility  obtained  from the "HVT"
function  on  Bloomberg  L.P.  determined  as of  the  Trading  Day  immediately
following the public announcement of the applicable Fundamental  Transaction and
(D) a  remaining  option  time equal to the time  between the date of the public
announcement of such transaction and the Termination Date.

                    (f)  CALCULATIONS.  All  calculations  under this  Section 3
shall be made to the nearest cent or the nearest 1/100th of a share, as the case
may be. For  purposes  of this  Section 3, the number of shares of Common  Stock
deemed to be issued and  outstanding  as of a given date shall be the sum of the
number of shares of Common Stock (excluding  treasury shares, if any) issued and
outstanding.

                    (g) NOTICE TO HOLDERS.

                        (i) ADJUSTMENT TO EXERCISE PRICE.  Whenever the Exercise
Price is adjusted pursuant to any provision of this Section 3, the Company shall
promptly  mail to each Holder a notice  setting  forth the Exercise  Price after
such  adjustment and setting forth a brief statement of the facts requiring such
adjustment.  If the  Company  issues  a  variable  rate  security,  despite  the
prohibition  thereon in the Purchase  Agreement,  the Company shall be deemed to
have issued  Common Stock or Common  Stock  Equivalents  at the lowest  possible
conversion  or  exercise  price at which such  securities  may be  converted  or
exercised in the case of a Variable Rate Transaction (as defined in the Purchase
Agreement).

                                       10
<PAGE>

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

         SECTION 4. TRANSFER OF WARRANT.

                    (a) TRANSFERABILITY. The Warrant and the other rights of the
Holder pursuant to this Warrant  certificate are not severable from this Warrant
certificate,  and shall not be assignable or  transferable  except in connection
with a transfer or assignment of this Warrant certificate in accordance with the
terms  hereof.  Any  instrument  purporting  to make a transfer or assignment in
violation  of this  Section  4(a)  shall be void and of no  effect.  Subject  to
compliance  with any applicable  securities laws and the conditions set forth in
Section  4(d)  hereof  and to the  provisions  of  Section  4.1 of the  Purchase
Agreement, this Warrant and all rights hereunder (including, without limitation,
any registration  rights) are transferable,  in whole or in part, upon surrender
of this  Warrant  certificate  at the  principal  office of the  Company  or its
designated   agent,   together  with  a  written   assignment  of  this  Warrant
substantially  in the form  attached  hereto duly  executed by the Holder or its
agent or attorney and funds  sufficient  to pay any transfer  taxes payable upon
the  making  of such  transfer.  Upon  compliance  with the  foregoing  and such
surrender and, if required,  such payment, the Company shall execute and deliver
a new Warrant or Warrants in the name of the  assignee or  assignees  and in the
denomination or  denominations  specified in such instrument of assignment,  and
shall issue to the assignor a new Warrant evidencing the portion of this Warrant
not so assigned,  and this Warrant shall  promptly be cancelled.  A Warrant,  if
properly assigned,  may be exercised by a new holder for the purchase of Warrant
Shares without having a new Warrant issued.

                                       11
<PAGE>

                    (b) NEW  WARRANTS.  This  Warrant may be divided or combined
with other  Warrants upon  presentation  hereof at the  aforesaid  office of the
Company,  together with a written notice  specifying the names and denominations
in which new  Warrants  are to be  issued,  signed by the Holder or its agent or
attorney.  Subject to compliance with Section 4(a), as to any transfer which may
be  involved in such  division or  combination,  the Company  shall  execute and
deliver a new Warrant or Warrants in exchange  for the Warrant or Warrants to be
divided or combined in accordance with such notice.

                    (c)  WARRANT  REGISTER.  The  Company  shall  register  this
Warrant,  upon  records to be  maintained  by the Company for that  purpose (the
"WARRANT REGISTER"),  in the name of the record Holder hereof from time to time.
The  Company  may deem and treat the  registered  Holder of this  Warrant as the
absolute owner hereof for the purpose of any exercise hereof or any distribution
to the Holder, and for all other purposes, absent actual notice to the contrary.

                    (d) TRANSFER RESTRICTIONS.  If, at the time of the surrender
of this Warrant in connection with any transfer of this Warrant, the transfer of
this  Warrant  shall not be  either  (i)  registered  pursuant  to an  effective
registration  statement  under the  Securities  Act and under  applicable  state
securities  or blue sky laws or (ii)  eligible  for  resale  without  volume  or
manner-of-sale  restrictions pursuant to Rule 144, the Company may require, as a
condition of allowing such transfer,  the Company may require, as a condition of
allowing such transfer (i) that the Holder or transferee of this Warrant, as the
case may be, furnish to the Company a written  opinion of counsel (which opinion
shall be in form,  substance  and scope  customary  for  opinions  of counsel in
comparable  transactions)  to the effect that such  transfer may be made without
registration  under the Securities Act and under  applicable state securities or
blue sky laws,  (ii) that the holder or  transferee  execute  and deliver to the
Company an investment letter in form and substance acceptable to the Company and
(iii)  that the  transferee  be an  "accredited  investor"  as  defined  in Rule
501(a)(1),  (a)(2),  (a)(3),  (a)(7), or (a)(8) promulgated under the Securities
Act or a "qualified  institutional  buyer" as defined in Rule 144A(a)  under the
Securities Act.

         SECTION 5. MISCELLANEOUS.

                    (a) NO RIGHTS AS SHAREHOLDER  UNTIL  EXERCISE.  This Warrant
does  not  entitle  the  Holder  to any  voting  rights  or  other  rights  as a
shareholder of the Company prior to the exercise  hereof as set forth in Section
2(e)(ii).

                    (b) LOSS, THEFT,  DESTRUCTION OR MUTILATION OF WARRANT.  The
Company  covenants  that upon  receipt  by the  Company of  evidence  reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this Warrant
or any stock  certificate  relating to the Warrant Shares,  and in case of loss,
theft or  destruction,  of indemnity or security  reasonably  satisfactory to it
(which, in the case of the Warrant,  shall not include the posting of any bond),
and upon surrender and  cancellation  of such Warrant or stock  certificate,  if
mutilated,  the Company will make and deliver a new Warrant or stock certificate
of like  tenor and dated as of such  cancellation,  in lieu of such  Warrant  or
stock certificate.

                    (c)  SATURDAYS,  SUNDAYS,  HOLIDAYS,  ETC.  If the  last  or
appointed  day for the  taking  of any  action  or the  expiration  of any right
required or granted herein shall not be a

                                       12
<PAGE>

Business  Day,  then such action may be taken or such right may be  exercised on
the next succeeding Business Day.

                    (d) AUTHORIZED SHARES.

                        (i) Subject to receiving Authorized Share Approval,  the
Company  covenants  that during the period the Warrant is  outstanding,  it will
reserve from its  authorized  and unissued  Common Stock a sufficient  number of
shares to provide for the  issuance of the Warrant  Shares upon the  exercise of
any purchase rights under this Warrant.  The Company further  covenants that its
issuance of this Warrant shall constitute full authority to its officers who are
charged with the duty of executing  stock  certificates to execute and issue the
necessary  certificates for the Warrant Shares upon the exercise of the purchase
rights under this Warrant.  The Company will take all such reasonable  action as
may be necessary  to assure that such  Warrant  Shares may be issued as provided
herein  without  violation  of  any  applicable  law  or  regulation,  or of any
requirements of the Trading Market upon which the Common Stock may be listed.

                        (ii) Except and to the extent as waived or  consented to
by  the  Holder,  the  Company  shall  not  by any  action,  including,  without
limitation,   amending  its   certificate  of   incorporation   or  through  any
reorganization, transfer of assets, consolidation, merger, dissolution, issue or
sale of securities  or any other  voluntary  action,  avoid or seek to avoid the
observance or performance  of any of the terms of this Warrant,  but will at all
times in good  faith  assist in the  carrying  out of all such  terms and in the
taking of all such  actions as may be necessary  or  appropriate  to protect the
rights  of  Holder  as set forth in this  Warrant  against  impairment.  Without
limiting the generality of the foregoing,  the Company will (a) not increase the
par value of any Warrant  Shares  above the amount  payable  therefor  upon such
exercise  immediately  prior to such  increase  in par value,  (b) take all such
action as may be necessary or  appropriate in order that the Company may validly
and legally issue fully paid and nonassessable  Warrant Shares upon the exercise
of this Warrant, and (c) use commercially  reasonable efforts to obtain all such
authorizations,  exemptions or consents from any public  regulatory  body having
jurisdiction  thereof as may be  necessary  to enable the Company to perform its
obligations under this Warrant.

                        (iii) Before  taking any action which would result in an
adjustment in the number of Warrant Shares for which this Warrant is exercisable
or in the Exercise Price,  the Company shall obtain all such  authorizations  or
exemptions  thereof,  or consents  thereto,  as may be necessary from any public
regulatory body or bodies having jurisdiction thereof.

                    (e) JURISDICTION. All questions concerning the construction,
validity,  enforcement and interpretation of this Warrant shall be determined in
accordance with the provisions of the Purchase Agreement.

                    (f) RESTRICTIONS.  The Holder  acknowledges that the Warrant
Shares acquired upon the exercise of this Warrant, if not registered,  will have
restrictions upon resale imposed by state and federal securities laws.

                                       13
<PAGE>

                    (g)  NONWAIVER  AND  EXPENSES.  No course of  dealing or any
delay or failure to exercise  any right  hereunder  on the part of Holder  shall
operate as a waiver of such right or otherwise prejudice Holder's rights, powers
or remedies, notwithstanding the fact that all rights hereunder terminate on the
Termination  Date. If the Company  willfully and knowingly  fails to comply with
any  provision of this  Warrant,  which  results in any material  damages to the
Holder,  the Company  shall pay to Holder such amounts as shall be sufficient to
cover  any  costs  and  expenses  including,  but  not  limited  to,  reasonable
attorneys' fees, including those of appellate proceedings, incurred by Holder in
collecting any amounts due pursuant hereto or in otherwise  enforcing any of its
rights, powers or remedies hereunder.

                    (h) NOTICES. Any notice,  request or other document required
or  permitted  to be given or  delivered  to the Holder by the Company  shall be
delivered in accordance with the notice provisions of the Purchase Agreement.

                    (i)  LIMITATION OF LIABILITY.  No provision  hereof,  in the
absence of any affirmative action by Holder to exercise this Warrant to purchase
Warrant Shares, and no enumeration herein of the rights or privileges of Holder,
shall give rise to any liability of Holder for the purchase  price of any Common
Stock or as a stockholder of the Company,  whether such liability is asserted by
the Company or by creditors of the Company.

                    (j)  REMEDIES.  Holder,  in  addition  to being  entitled to
exercise  all rights  granted by law,  including  recovery of  damages,  will be
entitled to specific  performance of its rights under this Warrant.  The Company
agrees that  monetary  damages would not be adequate  compensation  for any loss
incurred  by reason  of a breach by it of the  provisions  of this  Warrant  and
hereby  agrees to waive and not to assert the defense in any action for specific
performance that a remedy at law would be adequate.

                    (k) SUCCESSORS AND ASSIGNS. Subject to applicable securities
laws, this Warrant and the rights and obligations  evidenced  hereby shall inure
to the  benefit of and be binding  upon the  successors  of the  Company and the
successors and permitted  assigns of Holder.  The provisions of this Warrant are
intended to be for the benefit of all Holders  from time to time of this Warrant
and shall be enforceable by any such Holder or holder of Warrant Shares.

                    (l)  AMENDMENT.  This  Warrant may be modified or amended or
the  provisions  hereof  waived with the written  consent of the Company and the
Holder.

                    (m) SEVERABILITY.  Wherever possible, each provision of this
Warrant shall be  interpreted  in such manner as to be effective and valid under
applicable  law, but if any  provision of this Warrant shall be prohibited by or
invalid under  applicable law, such provision shall be ineffective to the extent
of such  prohibition or invalidity,  without  invalidating the remainder of such
provisions or the remaining provisions of this Warrant.

                    (n) HEADINGS.  The headings used in this Warrant are for the
convenience of reference  only and shall not, for any purpose,  be deemed a part
of this Warrant.

                            [SIGNATURE PAGE FOLLOWS]

                                       14
<PAGE>

                  IN WITNESS WHEREOF, the Company has caused this Warrant to be
executed by its officer thereunto duly authorized.

Dated: September 15, 2008

                                        ELITE PHARMACEUTICALS, INC.

                                        By:_____________________________________
                                           Name:
                                           Title:

                                       15
<PAGE>

                               NOTICE OF EXERCISE

TO: ELITE PHARMACEUTICALS, INC.

         (1) The undersigned  hereby elects to purchase  ________ Warrant Shares
of the Company  pursuant to the terms of the attached Warrant (only if exercised
in full), and tenders  herewith payment of the exercise price in full,  together
with all applicable transfer taxes, if any.

         (2) Payment shall take the form of (check applicable box):

                    [ ] in lawful money of the United States; or

                    [ ] [if  permitted]  the  cancellation  of  such  number  of
                    Warrant  Shares  as is  necessary,  in  accordance  with the
                    formula  set forth in  subsection  2(c),  to  exercise  this
                    Warrant with respect to the maximum number of Warrant Shares
                    purchasable  pursuant to the cashless exercise procedure set
                    forth in subsection 2(c).

         (3)  Please  issue a  certificate  or  certificates  representing  said
Warrant  Shares  in the  name of the  undersigned  or in such  other  name as is
specified below:

                    ----------------------------------------

The Warrant Shares shall be delivered to the following DWAC Account Number or by
physical delivery of a certificate to:

                    ----------------------------------------

                    ----------------------------------------

                    ----------------------------------------

         (4) ACCREDITED INVESTOR. The undersigned is an "accredited investor" as
defined  in  Regulation  D  promulgated  under the  Securities  Act of 1933,  as
amended.

[SIGNATURE OF HOLDER]

Name of Investing Entity: ______________________________________________________

SIGNATURE OF AUTHORIZED SIGNATORY OF INVESTING ENTITY: _________________________

Name of Authorized Signatory:  _________________________________________________

Title of Authorized Signatory: _________________________________________________

Date: __________________________________________________________________________

<PAGE>

                                 ASSIGNMENT FORM

                    (To assign the foregoing warrant, execute
                   this form and supply required information.
                 Do not use this form to exercise the warrant.)

         FOR VALUE RECEIVED,  [____] all of or [_______] shares of the foregoing
Warrant and all rights evidenced thereby are hereby assigned to

_______________________________________________ whose address is

_____________________________________________________________________.

_____________________________________________________________________

                                                Dated:  ______________, _______

                  Holder's Signature: _____________________________

                  Holder's Address:________________________________

                                   ________________________________

Signature Guaranteed: _____________________________________________

NOTE: The signature to this  Assignment Form must correspond with the name as it
appears on the face of the Warrant,  without  alteration or  enlargement  or any
change whatsoever,  and must be guaranteed by a bank or trust company.  Officers
of corporations and those acting in a fiduciary or other representative capacity
should file proper evidence of authority to assign the foregoing Warrant.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00147-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00147-of-00352.parquet"}]]