Document:

EXHIBIT 4.2

                           RULE 419 ESCROW AGREEMENT

Letter of Escrow Instructions

Regions Bank N.A.
721 Broad Street
Chattanooga, TN  37402

Re:   Contrarian Public Investment I, Inc. - Rule 419 escrow

This Letter of Escrow Instructions to Regions Bank N.A., hereinafter called
Escrow Agent, shall immediately and automatically become operative and effective
upon the commencement of a public distribution of certain securities of
Contrarian Public Investment I, Inc. (the "Company") which is described more
fully in the Company's Form S-1 Registration Statement under the Securities Act
of 1933 (Registration No. 333-118359).

The Company has delivered the papers, stock certificates and other property
hereinafter described to the Escrow Agent. All such papers, stock certificates,
and other property are to be held and disposed of by the Escrow Agent in
accordance with the following instructions and upon the terms and conditions
hereinafter set forth, to which the undersigned agree:

                           ARTICLE 1. ESCROW PURPOSE

1.1   This Escrow Agreement describes clearing and holding escrow that will be
established by Contrarian Public Investment I, Inc., of Chattanooga, Tennessee,
(the "Company") and all current stockholders of the Company (the "Selling
Stockholders") in accordance with the requirements of Securities and Exchange
Commission Rule 419, adopted pursuant to the provisions of Section 7(b) of the
Securities Act of 1933. The Company, the Selling Stockholders and the Escrow
Agent are the only parties to this Escrow Agreement.

1.2   In connection with the distribution described in the Company's Form S-1
Registration Statement (the "Distribution"), the Selling Stockholders intend to
transfer certain shares of the Company's $.001 par value common stock (the
"Common Stock") to certain classes of transferees described in the definitive
prospectus filed as part of the Company's Form S-1 Registration Statement.

1.3   The purpose of the escrow shall be to hold and ultimately distribute the
following stock certificates in accordance with the terms of Sections 4 through
6 this Escrow Agreement,

      (a)   Stock certificates evidencing the ownership of 1,850,000 presently
issued and outstanding shares of Common Stock (the "Shares") have been delivered
to the Escrow Agent; and

1.4   This Escrow Agreement constitutes an essential element of the Company's
proposed public offering of securities and is required by Securities and
Exchange Commission Rule 419. The parties to this Escrow Agreement shall, at all
times, conduct all of their activities relating to the Rule 419 escrow created
hereby in strict compliance with the letter and the spirit of Rule 419. In the
event of any inconsistency between the terms of this Escrow Agreement and the
requirements of Rule 419, the requirements of Rule 419 shall have priority.

                           ARTICLE 2. ESCROW DEPOSITS

2.1   The Escrow Agent shall accept deposits to the Escrow Account from time to
time during the entire term of this Agreement. All stock certificates delivered
to the Escrow Agent shall, upon delivery, automatically become subject to the
provisions of this Escrow Agreement.

<PAGE>

2.2   The initial Escrow Deposits will be in the form of individual stock
certificates representing the ownership of the Shares. All stock certificates
representing the Shares shall be registered in the name of individual Selling
Stockholder and contain complete information respecting the Selling
Stockholder's name, mailing address and taxpayer identification number. When the
Escrow Agent receives the stock certificates and other information specified in
this Paragraph, it shall promptly examine the stock certificates to confirm that
the stockholder information printed on the stock certificates complies in all
particulars with the stockholder information in the supporting schedules. The
Company shall promptly correct any errors, omissions or inconsistencies noted by
the Escrow Agent. Upon completion of the Share Distribution, the Selling
Stockholders shall jointly execute and deliver to the Escrow Agent a schedule
that identifies the specific Share transfers made by each Selling Stockholder.

2.3   All stock certificates delivered to the Escrow Agent pursuant to the
provisions of this Section 2 shall be held and disposed of by Escrow Agent in
accordance with the following instructions and upon the terms and conditions set
forth herein.

                    ARTICLE 3. TERMINATION AND DISBURSEMENTS

3.1   If the Company has not negotiated a business combination, filed a
post-effective amendment to its registration statement andsuccessfully completed
a reconfirmation offering meeting the requirements of Rule 419 within 16 months
after the effective date of its registration statement (the "Final Termination
Date"), the Escrow Agent shall:

      (a)   Return all stock certificates representing Shares to the Selling
Stockholders; and

      (b)   Return all stock ledgers to the Company.

When all stock certificates have been returned to the Selling Stockholders in
accordance with the provisions of this Paragraph 3.1, this Escrow Agreement will
terminate.

3.2   If the Company negotiates a business combination, files a post-effective
amendment to its registration statement and conducts a reconfirmation offering
meeting the requirements of Rule 419; and the terms of such offering are not
accepted by the number of Share Selling Stockholders specified in the definitive
prospectus included in the Company's post-effective amendment, the Company shall
immediately notify the Escrow Agent that the terms of its reconfirmation
offering have been rejected by the Share Selling Stockholders and the Escrow
Agent shall:

      (a)   Return all stock certificates representing Shares to the Selling
Stockholders; and

      (b)   Return all stock ledgers to the Company.

When all stock certificates have been returned to the Selling Stockholders in
accordance with the provisions this Paragraph 3.2, this Escrow Agreement will
terminate.

3.3   If the Company negotiates a business combination, files a post-effective
amendment to its registration statement and completes a reconfirmation offering
meeting the requirements of Rule 419 on or before the Final Termination Date,
the Company shall promptly deliver, or cause to be delivered, to the Escrow
Agent:

      (a)   A copy of the definitive prospectus included in its post-effective
amendment and used in connection with the reconfirmation offering;

      (b)   A schedule setting forth the identity of each Share Selling
Stockholder who has approved the terms of the reconfirmation offering in
writing; and

      (c)   A schedule setting forth the identity of each Share Selling
Stockholder who has rejected the terms of the reconfirmation offering in writing
or otherwise failed to execute a reconfirmation agreement within the time limits
specified in the definitive prospectus.

Upon receipt of the foregoing documentation, the Escrow Agent shall return to
the Selling Stockholders all stock certificates registered in the names of Share
Selling Stockholders who received Shares in connection with the Distribution and
ultimately refused or failed to execute a reconfirmation agreement within the
time limits specified in the definitive prospectus.

<PAGE>

3.4   If the Company satisfies the conditions of Paragraph 3.3, actually closes
the business combination described in the post-effective amendment to its
registration statement and delivers to the Escrow Agent a Certificate signed by
the President and Secretary that all conditions precedent to the final release
of stock certificates set forth in Rule 419(e)(3) have been satisfied, the
Escrow Agent shall:

      (a)   Mail stock certificates to each Selling Stockholder who received
Common Stock in connection with the Distribution and subsequently executed a
reconfirmation agreement; and/or

      (b)   If so directed by the company, deliver stock certificates for the
Shares to the closing agents specified in the associated stock purchase
agreements; but only if a closing agent was specified in the purchase agreement
delivered to the Escrow Agent pursuant to Paragraph 2.3 of this agreement. In
the event that a closing agent was not so specified, the Escrow Agent shall
retain possession of the stock certificates pending its receipt of joint
instructions from the Selling Stockholder and purchaser.

When all stock certificates and all Escrow Funds deposited with the Escrow Agent
have been disbursed in accordance with the provisions of this Paragraph 3.4,
this Escrow Agreement will terminate.

                           ARTICLE 4. NO MODIFICATION

4.1   After the effective date of the Company's Registration Statement, these
instructions shall not be modified, rescinded or amended without the written
consent of each Selling Stockholder.

                         ARTICLE 5. GENERAL PROVISIONS

5.1   All parties understand and agree that Escrow Agent is not a principal,
participant, or beneficiary of the underlying transaction that necessitates this
Escrow Agreement. The Escrow Agent shall be obligated only for the performance
of such duties as are specifically set forth herein and may rely and shall be
protected in acting or refraining from acting on any instrument believed by it
to be genuine and to have been signed or presented by the proper party or
parties, their officers, representatives or agents. The Escrow Agent shall not
be liable for any action taken or omitted by it in good faith and believed by it
to be authorized hereby, nor for action taken or omitted by it in accordance
with the advice of its counsel. Escrow Agent shall be responsible for holding,
investing and disbursing the Escrowed Assets pursuant to the Escrow Agreement,
but in no event shall be liable for any exemplary or consequential damages in
excess of Escrow Agent's fee hereunder.

5.2   Unless otherwise provided herein, the Escrow Agent shall accept the
Escrowed Assets pursuant to the Escrow Agreement and invest such assets at the
written request of the parties hereto specifying with particularity or by
accompanying schedule the type and identity of the assets to be deposited.
Acceptance of the Escrowed Assets shall be communicated by Escrow Agent to
parties by account statement or otherwise in writing as soon as practicable
after receipt, and any discrepancies shall be noted to Escrow Agent by the
parties in writing within forty five (45) days of receiving such communication.
Failure to note any discrepancies shall be deemed confirmation of the
description of Escrowed Assets listed on the report regardless of any variations
from the original schedule. Any request to invest assets shall be in writing or
facsimile and specify the type of investment to be made, the maturity date, and
the principal amount to be invested. The Escrow Agent shall not be liable for
delay or failure to invest funds without written instructions or for losses on
any investments made by it pursuant to and in compliance with such instructions.

5.3   Should any controversy arise between the undersigned with respect to this
Escrow Agreement or with respect to the right to receive the Escrowed Assets,
Escrow Agent shall have the right to consult counsel and/or to institute a bill
of interpleader in any court of competent jurisdiction to determine the rights
of the parties. In the event it is a party to any dispute, Escrow Agent shall
have the additional right to refer such controversy to binding arbitration.
Should such actions be necessary, or should Escrow Agent become involved in
litigation in any manner whatsoever on account of this Escrow Agreement of the
Escrowed Assets made hereunder, the undersigned hereby bind and obligate
themselves, their heirs and legal representatives to pay Escrow Agent, in
addition to any charge made hereunder for acting as Escrow Agent, reasonable
attorney's fees incurred by Escrow Agent, and any other disbursements, expenses,
losses, costs and damages in connection with and resulting from such actions.

<PAGE>

5.4   The Escrow Agent shall have no liability under, or duty to inquire beyond
the terms and provisions of the Escrow Agreement, and it is agreed that its
duties are purely ministerial in nature, and that the Escrow Agent shall incur
no liability whatsoever except for willful misconduct or gross negligence so
long as it has acted in good faith. The Escrow Agent shall not be bound by any
modification, amendment, termination, cancellation, rescission or supersession
of this Escrow Agreement unless the same shall be in writing and signed by all
of the other parties hereto and, if its duties as Escrow Agent hereunder are
affected thereby, unless it shall have given prior written consent thereto.

5.5   The Escrow Agent may at any time resign hereunder by giving written notice
of its resignation to the other parties hereto, at their address set forth
herein, at least ten (10) days prior to the date specified for such resignation
to take effect, and upon the effective date of such resignation, the Escrowed
Assets hereunder shall be delivered to such person as may be designated in
writing by the appropriate parties executing this Escrow Agreement, whereupon
all the Escrow Agent's obligations hereunder shall cease and terminate. The
Escrow Agent's sole responsibility until such termination shall be to keep
safely all Escrowed Assets and to deliver the same to a person designated by the
appropriate parties executing this Escrow Agreement or in accordance with the
directions of a final order or judgment of a court of competent jurisdiction.

5.6   The parties agree to indemnify, defend and hold the Escrow Agent harmless
from and against any and all loss, damage, tax, liability and expense that may
be incurred by the Escrow Agent arising out of or in connection with its
acceptance or appointments as Escrow Agent hereunder, including costs and
expenses of defending itself against any claim or liability in connection with
its performance hereunder.

5.7   The parties jointly and severally agree to pay to the Escrow Agent its
fees for the services rendered pursuant to the provisions of this Escrow
Agreement and will reimburse the Escrow Agent for reasonable expenses, including
reasonable attorney's fees incurred in connection with the negotiations,
drafting and performance of such services. Except as otherwise noted, this fee
covers account acceptance, set up and termination expenses; plus usual and
customary related administrative services such as safekeeping, investment and
payment of funds specified herein or in the exhibits attached. Activities
requiring excessive administrator time or out-of-pocket expenses such as
optional substitution of collateral or securities shall be deemed extraordinary
expenses for which related costs, transaction charges, and additional fees will
be billed at Escrow Agent's standard charges for such items. A fee schedule has
been provided to all parties to this Escrow.

5.8   Escrow Agent is hereby given a lien on all Escrowed Assets for all
indebtedness that may become owing to Escrow Agent hereunder, which lien may be
enforced by Escrow Agent by setoff or appropriate foreclosure proceedings.

5.9   The parties warrant to the Escrow Agent that there are no Federal, State
or local tax liability or filing requirements whatsoever concerning the Escrow
Agent's actions contemplated hereunder and warrant and represent to the Escrow
Agent that the Escrow Agent has no duty to withhold or file any report of any
tax liability under any Federal of State income tax, local or State property
tax, local or State sales or use taxes, or any other tax by any taxing
authority. The parties hereto agree to jointly and severally indemnify the
Escrow Agent fully for any tax liability, penalties or interest incurred by the
Escrow Agent arising hereunder and agree to pay in full any such tax liability
together with penalty and interest if any tax liability is ultimately assessed
against the Escrow Agent for any reason as a result of its action hereunder
(except for the Escrow Agent's individual income tax liability arising from its
income fees).

<PAGE>

5.10  The Escrow Agent shall have no liability for loss arising from any cause
beyond its control, including, but not limited to, the following: (a) the act,
failure or neglect of any agent or correspondent selected by the Escrow Agent or
the parties hereto; (b) any delay, error, omission or default connected with the
remittance of funds; (c) any delay, error, omission or default of any mail,
telegraph, cable or wireless agency or operator; (d) the acts or edicts of any
government or governmental agency or other group or entity exercising
governmental powers.

5.11  This Escrow Agreement shall be governed by and construed in accordance
with the laws of the State of Tennessee. The parties hereto expressly waive such
duties and liabilities, it being their intent to create solely an agency
relationship and hold the Escrow Agent liable only in the event of its gross
negligence or willful misconduct in order to obtain the lower fee schedule rates
as specifically negotiated with the Escrow Agent.

                               ARTICLE 6. NOTICES

6.1   All notices, demands, requests or payments provided for or given pursuant
to this Escrow must be in writing or facsimile. All such notices shall be deemed
to have been properly given or served by personal delivery or by depositing the
same in the United States mail addressed to the person entitled to receive such
notice at the address set forth below.

To the Company                                   To the Escrow Agent:

Douglas A. Dyer, President                       Melissa Shaw, Vice President
Contrarian Public Investment I, Inc.             Regions Bank, N.A.
735 Broad Street, Suite 218                      721 Broad Street
Chattanooga, TN  37402                           Chattanooga, TN  37402

6.2   All notices shall be effective when received.

Approved and accepted by the Parties this 2 day of December 2004.

Contrarian Public Investment I, Inc.
Regions Bank, N.A.

By: /s/  Douglas A. Dyer
  -----------------------------
  Douglas A. Dyer, President

By: /s / Mellisa Shaw
  -----------------------------
  Mellisa Shaw, Vice PresidentEXHIBIT
      4.1

     

    THIS
      WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE BEEN ACQUIRED
      FOR
      INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
      AMENDED (THE “ACT”), OR ANY STATE SECURITIES LAW. THIS WARRANT AND SUCH
      SECURITIES MAY NOT BE OFFERED, SOLD OR OTHERWISE PLEDGED, TRANSFERRED OR
      HYPOTHECATED IN THE ABSENCE OF SUCH REGISTRATION OR DELIVERY OF AN OPINION
      OF
      COUNSEL IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH
      OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS IN COMPLIANCE WITH THE
      ACT
      OR UNLESS SOLD IN FULL COMPLIANCE WITH RULE 144 UNDER THE ACT.

     

    INSITE
      VISION INCORPORATED

     

    Warrant
      for the Purchase of Shares of

    Common
      Stock

     

    Date:
      October 6, 2005

     

    
      	
              No.
                B I1 

            	
              922,800
                Shares

            
	 	 

    

    FOR
      VALUE
      RECEIVED, INSITE VISION INCORPORATED, a Delaware corporation (the “Company”),
      hereby certifies that Bristol
      Investment Group, Inc.
      or its
      designee or its permitted assigns is entitled to purchase from the Company,
      at
      any time or from time to time commencing on October 6, 2005 and prior to 5:00
      P.M., New York City time, on October 6, 2010, Nine Hundred Twenty-Two Thousand
      Eight Hundred (922,800) fully paid and non-assessable shares of common stock,
      $0.01 par value per share, of the Company for an aggregate purchase price of
      $461,400. (Hereinafter, (i) said common stock, $0.01 par value per share, of
      the
      Company, is referred to as the “Common
      Stock”;
      (ii)
      the shares of the Common Stock purchasable hereunder (as hereinafter defined)
      are referred to as the “Warrant
      Shares”;
      (iii)
      the aggregate purchase price payable for the Warrant Shares purchasable
      hereunder is referred to as the “Aggregate
      Warrant Price”;
      (iv)
      the price payable ($0.50 per share subject to adjustment) for each of the
      Warrant Shares hereunder is referred to as the “Per
      Share Warrant Price”;
      (vi)
      the holder of this Warrant is referred to as the “Holder”;
      and
      (vii) the then current market price per share of the Common Stock (the
“Current
      Market Price”)
      shall
      be deemed to be the last reported trade of the Common Stock on the trading
      day
      prior to such date or, in case no such reported sales take place on such day,
      the average of the last reported bid and asked prices of the Common Stock on
      such day, in either case on the principal national securities exchange on which
      the Common Stock is admitted to trading or listed, or if not listed or admitted
      to trading on any such exchange, the representative closing sale price of the
      Common Stock as reported by the National Association of Securities Dealers,
      Inc.
      Automated Quotations System (“NASDAQ”),
      or
      other similar organization if NASDAQ is no longer reporting such information,
      or, if the Common Stock is not reported on NASDAQ, the high per share sale
      price
      for the Common Stock in the over-the-counter market as reported by the National
      Quotation Bureau or similar organization, or if not so available, the fair
      market value of the Common Stock as determined in good faith by the Company’s
      board of directors (the “Board
      of Directors”).
      The
      Aggregate Warrant Price is not subject to adjustment. The Per Share Warrant
      Price is subject to adjustment as hereinafter provided; in the event of any
      such
      adjustment, the number of Warrant Shares deliverable upon exercise of this
      Warrant shall be adjusted by dividing the Aggregate Warrant Price by the Per
      Share Warrant Price in effect immediately after such adjustment.

     

    
      
        
        

      

      
        -1-

        
          

        

      

      
        
        

      

    

     

    1.    Exercise
      of Warrant.

     

    (a)  This
      Warrant may be exercised in whole at any time, or in part from time to time,
      commencing on the date hereof and prior to 5:00 P.M., New York City time, on
      the
      fifth anniversary of the date hereof by the Holder:

     

    (i)  by
      the
      surrender of this Warrant (with the subscription form at the end hereof duly
      executed) at the address set forth in Section 9(a) hereof, together with proper
      payment of the Aggregate Warrant Price, or the proportionate part thereof if
      this Warrant is exercised in part, with payment for the Warrant Shares made
      by
      certified or official bank check payable to the order of the Company;
      or

     

    (ii)  by
      the
      surrender of this Warrant (with the cashless exercise form at the end hereof
      duly executed) (a “Cashless
      Exercise”)
      at the
      address set forth in Section 9(a) hereof. Pursuant to such Cashless Exercise,
      the aggregate purchase price for Warrant Shares being purchased hereunder shall
      be paid by surrender of a number of Warrant Shares available for exercise under
      this Warrant that have a Current Market Price equal to the aggregate purchase
      price of the Warrant Shares being purchased as determined herein. If the Holder
      elects the Cashless Exercise method of payment, the Company shall issue to
      Holder upon exercise a number of shares of Warrant Shares determined in
      accordance with the following formula:

     

    X=
        Y(A-B)  

      A

    

    where:   
      X
      =          the
      number of Warrant Shares to be issued to the Holder;

     

    
      	 	
              Y
                =

            	
              the
                number of Warrant Shares with respect to which the Holder is exercising
                its purchase rights under this
                Warrant;

            

    

     

    
      	 	
              A
                =

            	
              the
                Current Market Price of one (1) share of the Warrant Shares on the
                date of
                exercise; and

            

    

     

    B
      = the
      Per
      Share Warrant Price.

     

    No
      fractional shares arising out of the above formula for determining the number
      of
      shares to be issued to the Holder shall be issued, and the Company shall in
      lieu
      thereof make payment to the Holder of cash in the amount of such fraction
      multiplied by the Current Market Price of one (1) share of the Warrant Shares
      on
      the date of exercise.

     

    (b)  If
      this
      Warrant is exercised in part, this Warrant must be exercised for a number of
      whole shares of the Common Stock and the Holder is entitled to receive a new
      Warrant covering the Warrant Shares that have not been exercised and setting
      forth the proportionate part of the Aggregate Warrant Price applicable to such
      Warrant Shares. Upon surrender of this Warrant, the Company will (i) issue
      a
      certificate or certificates in the name of the Holder for the largest number
      of
      whole shares of the Common Stock to which the Holder shall be entitled and,
      if
      this Warrant is exercised in whole, in lieu of any fractional share of the
      Common Stock to which the Holder shall be entitled, pay to the Holder cash
      in an
      amount equal to the fair value of such fractional share (determined in such
      reasonable manner as the Board of Directors of the Company shall determine),
      and
      (ii) deliver the other securities and properties receivable upon the exercise
      of
      this Warrant, or the proportionate part thereof, if this Warrant is exercised
      in
      part, pursuant to the provisions of this Warrant.

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

     

    2.    Reservation
      of Warrant Shares; Listing.

     

    The
      Company agrees that, prior to the expiration of this Warrant, the Company shall
      at all times (a) have authorized and in reserve, and shall keep available,
      solely for issuance and delivery upon the exercise of this Warrant, the shares
      of the Common Stock and other securities and properties as from time to time
      shall be receivable upon the exercise of this Warrant, free and clear of all
      restrictions on sale or transfer, other than under Federal or state securities
      laws, and free and clear of all preemptive rights and rights of first refusal
      and (b) if the Company hereafter lists its Common Stock on any national
      securities exchange, the Nasdaq National Market or the Nasdaq Smallcap Market,
      use its commercially reasonable efforts to keep the Warrant Shares authorized
      for listing on such exchange upon notice of issuance.

     

    3.    Certain
      Adjustments.

     

    (a)  If,
      at
      any time or from time to time after the date of this Warrant, the Company shall
      issue or distribute to all holders of shares of Common Stock by reason of their
      ownership thereof evidence of its indebtedness, any other securities of the
      Company or any cash, property or other assets (excluding a subdivision,
      combination or reclassification, or dividend or distribution payable in shares
      of Common Stock, referred to in Section 3(b), and also excluding cash dividends
      or cash distributions paid out of net profits legally available therefor in
      the
      full amount thereof (any such non-excluded event being herein called a
“Special
      Dividend”)),
      the
      Per Share Warrant Price shall be adjusted by multiplying the Per Share Warrant
      Price then in effect by a fraction, the numerator of which shall be the then
      Current Market Price in effect on the record date of such issuance or
      distribution less the fair market value (as determined in good faith by the
      Company’s Board of Directors) of the evidence of indebtedness, cash, securities
      or property, or other assets issued or distributed in such Special Dividend
      applicable to one share of Common Stock and the denominator of which shall
      be
      the then Current Market Price in effect on the record date of such issuance
      or
      distribution. An adjustment made pursuant to this Subsection 3(a) shall become
      effective immediately after the record date of any such Special
      Dividend.

     

    (b)  In
      case
      the Company shall hereafter (i) pay a dividend or make a distribution on its
      capital stock in shares of Common Stock, (ii) subdivide its outstanding shares
      of Common Stock into a greater number of shares, (iii) combine its outstanding
      shares of Common Stock into a smaller number of shares or (iv) issue by
      reclassification of its Common Stock any shares of capital stock of the Company,
      the Per Share Warrant Price shall be adjusted to be equal to a fraction, the
      numerator of which shall be the Aggregate Warrant Price and the denominator
      of
      which shall be the number of shares of Common Stock or other capital stock
      of
      the Company that the Holder would have owned immediately following such action
      had such Warrant been exercised immediately prior thereto. An adjustment made
      pursuant to this Subsection 3(b) shall become effective immediately after the
      record date in the case of a dividend or distribution, and shall become
      effective immediately after the effective date in the case of a subdivision,
      combination or reclassification.

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

     

    (c)  In
      case
      of any capital reorganization or reclassification, or any consolidation or
      merger to which the Company is a party other than a merger or consolidation
      in
      which the Company is the continuing corporation, or in case of any sale or
      conveyance to another entity of all or substantially all of the assets of the,
      or in the case of any statutory exchange of securities with another corporation
      (including any exchange effected in connection with a merger of a third
      corporation into the Company, but excluding any exchange of securities or merger
      with another corporation in which the Company is a continuing corporation and
      that does not result in any reclassification of or similar change in the Common
      Stock), the Holder of this Warrant shall have the right thereafter to receive
      on
      the exercise of this Warrant the kind and amount of securities, cash or other
      property which the Holder would have owned or have been entitled to receive
      immediately after such reorganization, reclassification, consolidation, merger,
      statutory exchange, sale or conveyance had this Warrant been exercised
      immediately prior to the effective date of such reorganization,
      reclassification, consolidation, merger, statutory exchange, sale or conveyance
      and in any such case, if necessary, appropriate adjustment shall be made in
      the
      application of the provisions set forth in this Section 3 with respect to the
      rights and interests thereafter of the Holder of this Warrant to the end that
      the provisions set forth in this Section 3 shall thereafter correspondingly
      be
      made applicable, as nearly as may reasonably be, in relation to any shares
      of
      stock or other securities or property thereafter deliverable on the exercise
      of
      this Warrant. The above provisions of this Section 3(c) shall similarly apply
      to
      successive reorganizations, reclassifications, consolidations, mergers,
      statutory exchanges, sales or conveyances. The Company shall require the issuer
      of any shares of stock or other securities or property thereafter deliverable
      on
      the exercise of this Warrant to be responsible for all of the agreements and
      obligations of the Company hereunder. Notice of any such reorganization,
      reclassification, consolidation, merger, statutory exchange, sale or conveyance
      and of said provisions so proposed to be made, shall be mailed to the Holders
      of
      the Warrants not less than twenty (20) days prior to such event. A sale of
      all
      or substantially all of the assets of the Company for a consideration consisting
      primarily of securities shall be deemed a consolidation or merger for the
      foregoing purposes.

     

    (d)  No
      adjustment in the Per Share Warrant Price shall be required unless such
      adjustment would require an increase or decrease of at least $0.01 per share
      of
      Common Stock; provided,
      however,
      that
      any adjustments which by reason of this Subsection 3(d) are not required to
      be
      made shall be carried forward and taken into account in any subsequent
      adjustment; provided, further, however, that adjustments shall be required
      and
      made in accordance with the provisions of this Section 3 (other than this
      Subsection 3(d)) not later than such time as may be required in order to
      preserve the tax-free nature of a distribution (if any) to the Holder of this
      Warrant or Common Stock issuable upon the exercise hereof. All calculations
      under this Section 3 shall be made to the nearest cent or to the nearest 1/100th
      of a share, as the case may be. Anything in this Section 3 to the contrary
      notwithstanding, the Company shall be entitled to make such reductions in the
      Per Share Warrant Price, in addition to those required by this Section 3, as
      it
      in its discretion shall deem to be advisable in order that any stock dividend,
      subdivision of shares or distribution of rights to purchase stock or securities
      convertible or exchangeable for stock hereafter made by the Company to its
      stockholders shall not be taxable.

     

    (e)  Whenever
      the Per Share Warrant Price is adjusted as provided in this Section 3 and upon
      any modification of the rights of a Holder of Warrants in accordance with this
      Section 3, the Company shall promptly prepare a brief statement of the facts
      requiring such adjustment or modification and the manner of computing the same
      and cause copies of such certificate to be mailed to the Holders of the
      Warrants. The Company may, but shall not be obligated to unless requested by
      a
      Majority of the Holders, obtain, at its expense, a certificate of a firm of
      independent public accountants of recognized standing selected by the Board
      of
      Directors (who may be the regular auditors of the Company) setting forth the
      Per
      Share Warrant Price and the number of Warrant Shares in effect after such
      adjustment or the effect of such modification, a brief statement of the facts
      requiring such adjustment or modification and the manner of computing the same
      and cause copies of such certificate to be mailed to the Holders of the
      Warrants.

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

     

    (f)  If
      the
      Board of Directors of the Company shall declare any dividend or other
      distribution with respect to the Common Stock other than a cash distribution
      out
      of earned surplus, the Company shall mail notice thereof to the Holders of
      the
      Warrants not less than ten (10) days prior to the record date fixed for
      determining stockholders entitled to participate in such dividend or other
      distribution.

     

    (g)  If,
      as a
      result of an adjustment made pursuant to this Section 3, the Holder of any
      Warrant thereafter surrendered for exercise shall become entitled to receive
      shares of two or more classes of capital stock or shares of Common Stock and
      other capital stock of the Company, the Board of Directors (whose determination
      shall be conclusive and shall be described in a written notice to the Holder
      of
      any Warrant promptly after such adjustment) shall determine the allocation
      of
      the adjusted Per Share Warrant Price between or among shares or such classes
      of
      capital stock or shares of Common Stock and other capital stock.

     

    (h)  Upon
      the
      expiration of any rights, options, warrants or conversion privileges with
      respect to the issuance of which an adjustment to the Per Share Warrant Price
      had been made, if such option, right warrant or conversion shall not have been
      exercised, the number of Warrant Shares purchasable upon exercise of this
      Warrant, to the extent this Warrant has not then been exercised, shall, upon
      such expiration, be readjusted and shall thereafter be such as they would have
      been had they been originally adjusted (or had the original adjustment not
      been
      required, as the case may be) on the basis of (A) the fact that Common Stock,
      if
      any, actually issued or sold upon the exercise of such rights, options, warrants
      or conversion privileges, and (B) the fact that such shares of Common Stock,
      if
      any, were issued or sold for the consideration actually received by the Company
      upon such exercise plus the consideration, if any, actually received by the
      Company for the issuance, sale or grant of all such rights, options, warrants
      or
      conversion privileges whether or not exercised; provided, however, that no
      such
      readjustment shall have the effect of decreasing the number of Warrant Shares
      purchasable upon exercise of this Warrant by an amount in excess of the amount
      of the adjustment initially made in respect of the issuance, sale or grant
      of
      such rights, options, warrants or conversion privileges.

     

    (i)  In
      case
      any event shall occur as to which the other provisions of this Section 3 are
      not
      strictly applicable but as to which the failure to make any adjustment would
      not
      fairly protect the purchase rights represented by this Warrant in accordance
      with the essential intent and principles of the adjustments set forth in this
      Section 3, then, in each such case, the Board of Directors of the Company shall
      in good faith determine the adjustment, if any, on a basis consistent with
      the
      essential intent and principles established herein, necessary to preserve the
      purchase rights represented by the Warrants. Upon such determination, the
      Company will promptly mail a copy thereof to the Holder of this Warrant and
      shall make the adjustments described therein.

     

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

     

    4.    Fully
      Paid Stock; Taxes.

     

    The
      shares of the Common Stock represented by each and every certificate for Warrant
      Shares delivered on the exercise of this Warrant shall, subject to the Holder’s
      compliance with the terms hereof, at the time of such delivery, be duly
      authorized, validly issued and outstanding, fully paid and nonassessable, and
      not subject to preemptive rights or rights of first refusal on the part of
      the
      Company, and the Company will take all such actions as may be necessary to
      assure that the par value, if any, per share of the Common Stock is at all
      times
      equal to or less than the then Per Share Warrant Price. The Company shall pay,
      when due and payable, any and all Federal and state stamp, original issue or
      similar taxes which may be payable in respect of the issue of any Warrant Share
      or any certificate thereof to the extent required because of the issuance by
      the
      Company of such security.

     

    5.    SEC
      Filings.

     

    Until
      all
      of the Warrant Shares have been sold under a Registration Statement or pursuant
      to Rule 144(k), the Company shall use its commercially reasonable efforts to
      file with the Securities and Exchange Commission all current reports and the
      information as may be necessary to enable the Holder to effect sales of its
      shares in reliance upon Rule 144(K) promulgated under the Act.

     

    6.    Investment
      Intent; Limited Transferability.

     

    (a)  The
      Holder represents to the Company, by accepting this Warrant, that it understands
      that this Warrant and any securities obtainable upon exercise of this Warrant
      have not been registered for sale under Federal or state securities laws and
      are
      being offered and sold to the Holder pursuant to one or more exemptions from
      the
      registration requirements of such securities laws. In the absence of an
      effective registration of such securities or an exemption therefrom, any
      certificates for such securities shall bear the legend set forth on the first
      page hereof. The Holder understands that it must bear the economic risk of
      its
      investment in this Warrant and any securities obtainable upon exercise of this
      Warrant for an indefinite period of time, as this Warrant and such securities
      have not been registered under Federal or state securities laws and therefore
      cannot be sold unless subsequently registered under such laws, unless an
      exemption from such registration is available. The Holder further represents
      to
      the Company, by accepting this Warrant, that is has full power and authority
      to
      enter into this Warrant and make the representations set forth
      herein.

     

    (b)  The
      Holder, by its acceptance of this Warrant, represents to the Company that it
      is
      acquiring this Warrant and will acquire any securities obtainable upon exercise
      of this Warrant for its own account for investment and not with a view to,
      or
      for sale in connection with, any distribution thereof in violation of the Act.
      The Holder, by acceptance of this Warrant, agrees that this Warrant and any
      such
      securities will not be sold or otherwise transferred unless (i) a registration
      statement with respect to such transfer is effective under the Act and any
      applicable state securities laws or (ii) such sale or transfer is made pursuant
      to one or more exemptions from the Act and in accordance with the legend set
      forth on the first page hereof.

     

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

     

    (c)  The
      Holder, by its acceptance of this Warrant, represents to the Company that that
      it is able to fend for itself, can bear the economic risk of its investment,
      has
      such knowledge and experience in financial or business matters that it is
      capable of evaluating the merits and risks of the investment in this Warrant,
      has received and reviewed a copy of the Confidential Private Offering Memorandum
      provided by the Company in connection with the Subscription Agreements, the
      Company’s public filings with the Securities and Exchange Commission and has had
      the opportunity to ask questions and receive answers from the Company regarding
      its business and financial condition. Holder also represents it has not been
      organized for the purpose of acquiring this Warrant.

     

    (d)  This
      Warrant may not be sold, transferred, assigned or hypothecated by the Holder
      except in compliance with the provisions of the Securities Act and the
      applicable state securities “blue sky” laws, and is so transferable only upon
      the books of the Company which it shall cause to be maintained for such purpose.
      By acceptance of this Warrant each Holder (including any transferee of this
      Warrant or any portion hereof), makes the representations set forth herein.
      The
      Company may treat the registered Holder of this Warrant as it appears on the
      Company’s books at any time as the Holder for all purposes. The Company shall
      permit any Holder of a Warrant or its duly authorized attorney, upon written
      request during ordinary business hours, to inspect and copy or make extracts
      from its books showing the registered Holders of Warrant. All Warrants issued
      upon the transfer or assignment of this Warrant will be dated the same date
      as
      this Warrant, and all rights and obligations of the holder thereof shall be
      identical to those of the Holder.

     

    (e)  Such
      Holder is acquiring the Warrants for its own account and not with a present
      view
      to, or for sale in connection with, any distribution thereof in violation of
      the
      registration requirements of the Act, without prejudice, however, to such
      Holder’s right, subject to the provisions of the Subscription Agreement and this
      Warrant, at all times to sell or otherwise dispose of all or any part of such
      Warrants and Warrant Shares.

     

    7.    Loss,
      etc., of Warrant.

     

    Upon
      receipt of evidence satisfactory to the Company of the loss, theft, destruction
      or mutilation of this Warrant, and of indemnity reasonably satisfactory to
      the
      Company, if lost, stolen or destroyed, and upon surrender and cancellation
      of
      this Warrant, if mutilated, the Company shall execute and deliver to the Holder
      a new Warrant of like date, tenor and denomination.

     

    8.    Warrant
      Holder Not Stockholder.

     

    This
      Warrant does not confer upon the Holder any right to vote on or consent to
      or
      receive notice as a stockholder of the Company, as such, in respect of any
      matters whatsoever, nor any other rights or liabilities as a stockholder, prior
      to the exercise hereof; this Warrant does, however, require certain notices
      to
      Holders as set forth herein.

     

    9.    Communication.

     

    No
      notice
      or other communication under this Warrant shall be effective or deemed to have
      been given unless, the same is in writing and is mailed by first-class mail,
      postage prepaid, or via recognized overnight courier with confirmed receipt,
      addressed to:

     

    (a)  the
      Company at Insite Vision Incorporated, Chief Financial Officer, 965 Atlantic
      Avenue, Alameda, CA 94501, or other such address as the Company has designated
      in writing to the Holder.

     

    (b)  the
      Holder at 135 East 57th St., 15th Floor, New York, NY 10022, or other such
      address as the Holder has designated in writing to the Company.

     

    
      	10.	
              Headings.

            

    

     

    The
      headings of this Warrant have been inserted as a matter of convenience and
      shall
      not affect the construction hereof.

     

    
      	11.	
              Applicable
                Law.

            

    

     

    This
      Warrant shall be governed by and construed in accordance with the law of the
      State of New York without giving effect to the principles of conflicts of law
      thereof.

     

    
      	12.	
              Amendment,
                Waiver, etc.

            

    

     

    Except
      as
      expressly provided herein, neither this Warrant nor any term hereof may be
      amended, waived, discharged or terminated other than by a written instrument
      signed by the party against whom enforcement of any such amendment, waiver,
      discharge or termination is sought.

     

    
      
        
        

      

      
        -7-

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF, the Company has caused this Warrant to be signed by its Chief
      Executive Officer and attested by its Secretary this ____ day of October,
      2005.

     

    
      
        	 	 	 
	 	INSITE
                VISION INCORPORATED
	 
 	 
 	 
 
	 	By:  	/s/ S.
                Kumar Chandrasekaran
	 	
                

              
	 	
                Name:    
                  S. Kumar Chandrasekaran, Ph.D.

                Title:      
                  Chief Executive Officer

              

      

     

    ATTEST:

     

    

     

    /s/
      Lyle
      M. Bowman 
      
        
Lyle
        M.
        Bowman, Secretary

    

     

    

     

    

     

    

    
      
        
          COMMON
            STOCK WARRANT - BRISTOL INVESTMENT GROUP, INC.

        

        
        

      

      
        -8-

        
          

        

      

      
        
        

        
        

      

    

    
SUBSCRIPTION (cash)

     

    The
      undersigned,___________________________, pursuant to the provisions of the
      foregoing Warrant, hereby agrees to subscribe for and purchase ________________
      shares of the Common Stock, par value $0.01 per share, of InSite Vision
      Incorporated covered by said Warrant, and makes payment therefor in full at
      the
      price per share provided by said Warrant.

     

    
      	Dated:____________________	Signature:______________________________
	 	 
	 	Address:______________________________

    

     

             

    CASHLESS
      EXERCISE

     

    The
      undersigned ____________________, pursuant to the provisions of the foregoing
      Warrant, hereby elects to exchange its Warrant for ____________________ shares
      of Common Stock, par value $0.01 per share, of InSite Vision Incorporated
      pursuant to the Cashless Exercise provisions of the Warrant.

     

    
      
        	Dated:____________________	Signature:______________________________
	 	 
	 	Address:______________________________

      

       

    

       

     

    

    
      
        
        

      

      
        -9-

        
          

        

      

      
        
        

      

    

    

    ASSIGNMENT

     

    FOR
      VALUE
      RECEIVED _____________________ hereby sells, assigns and transfers unto
      ______________________ (“Transferee”)
      the
      foregoing Warrant and all rights evidenced thereby, and does irrevocably
      constitute and appoint ________________________, attorney, to transfer said
      Warrant on the books of InSite Vision Incorporated. By acceptance of the
      foregoing Warrant, Transferee shall become a Holder under said Warrant and
      subject to the rights, obligations and representations of Holder set forth
      in
      said Warrant.

     

    
      
        	Dated:____________________	Signature:______________________________
	 	 
	 	Address:______________________________

      

       

    

     

    PARTIAL
      ASSIGNMENT

     

    FOR
      VALUE
      RECEIVED _______________ hereby assigns and transfers unto ____________________
      the right to purchase __________ shares of Common Stock, par value $0.01 per
      share, of InSite Vision Incorporated covered by the foregoing Warrant, and
      a
      proportionate part of said Warrant and the rights evidenced thereby, and does
      irrevocably constitute and appoint ____________________, attorney, to transfer
      such part of said Warrant on the books of InSite Vision Incorporated. By
      acceptance of the proportionate part of foregoing Warrant, Transferee shall
      become a Holder under said proportionate part of said Warrant and subject to
      the
      rights, obligations and representations of Holder set forth in said
      Warrant.

     

    
      
        	Dated:____________________	Signature:______________________________
	 	 
	 	Address:______________________________

      

       

       

      
        
          
          

        

        -10-

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