Document:

<PAGE>

                               NEWTECH BRAKE CORP.
                            PLACEMENT AGENT AGREEMENT

                                                    Dated as of: January 6, 2004

Westrock Advisors, Inc.
230 Park Avenue, Floor 9
New York, New York 10169

Ladies and Gentlemen:

         The  undersigned,  NewTech  Brake Corp.,  a Delaware  corporation  (the
"Company"),  hereby agrees with Westrock Advisors,  Inc., a New York corporation
(the "Placement  Agent") and Cornell Capital  Partners,  LP, a Delaware  Limited
Partnership (the "Investor") as follows:

         1. Offering.  The Company hereby engages the Placement  Agent to act as
its  exclusive  placement  agent in  connection  with the Equity  Line of Credit
Agreement  dated  the date  hereof,  (the  "Equity  Line of  Credit  Agreement")
pursuant to which the Company shall issue and sell to the Investor, from time to
time, and the Investor  shall  purchase from the Company (the  "Offering") up to
Ten  Million  Dollars   ($US10,000,000)  of  the  Company's  common  stock  (the
"Commitment  Amount"),  par value US$0.0001 per share (the "Common  Stock"),  at
price per share  equal to the  Purchase  Price,  as that term is  defined in the
Equity Line of Credit  Agreement.  Pursuant to the terms  hereof,  the Placement
Agent shall render consulting services to the Company with respect to the Equity
Line of Credit  Agreement and shall be available for  consultation in connection
with the advances to be requested by the Company  pursuant to the Equity Line of
Credit Agreement

         All  capitalized  terms used herein and not  otherwise  defined  herein
shall have the same  meaning  ascribed  to them as in the Equity  Line of Credit
Agreement. The Investor will be granted certain registration rights with respect
to the Common Stock as more fully set forth in the Registration Rights Agreement
between the Company and the  Investor  dated the date hereof (the  "Registration
Rights  Agreement").  The  documents to be executed and  delivered in connection
with the Offering,  including,  but not limited,  to this Agreement,  the Equity
Line of Credit  Agreement,  the Registration  Rights  Agreement,  and the Escrow
Agreement with Wachovia  Bank,  N.A. (the "Escrow  Agreement"),  are referred to
sometimes  hereinafter  collectively as the "Offering  Materials." The Company's
Common Stock is  sometimes  referred to  hereinafter  as the  "Securities."  The
Placement Agent shall not be obligated to sell any Securities.

         2. Compensation.

         A. The  Placement  Agent  acknowledges  and agrees that the Company has
previously issued to the Placement Agent shares of the Company's Common Stock in
an amount equal to Ten Thousand Dollars ($10,000) (collectively,  the "Placement
Agent's  Shares").  The  Placement  Agent  shall  be  entitled  to  "piggy-back"
registration rights triggered upon registration of any shares of Common Stock by
the  Investor  with  respect to the  Placement  Agent's  Shares  pursuant to the
Registration Rights Agreement dated the date hereof.

<PAGE>

         3. Representations, Warranties and Covenants of the Placement Agent.

         A. The Placement Agent represents, warrants and covenants as follows:

                  (i) The Placement  Agent has the necessary power to enter into
this Agreement and to consummate the transactions contemplated hereby .

                  (ii) The execution and delivery by the Placement Agent of this
Agreement and the consummation of the transactions  contemplated herein will not
result in any  violation  of, or be in conflict  with,  or  constitute a default
under, any agreement or instrument to which the Placement Agent is a party or by
which the Placement Agent or its properties are bound, or any judgment,  decree,
order or, to the Placement Agent's  knowledge,  any statute,  rule or regulation
applicable to the Placement Agent. This Agreement when executed and delivered by
the Placement Agent, will constitute the legal, valid and binding obligations of
the Placement  Agent,  enforceable in accordance  with their  respective  terms,
except  to the  extent  that (a) the  enforceability  hereof or  thereof  may be
limited by bankruptcy,  insolvency,  reorganization,  moratorium or similar laws
from time to time in effect and affecting the rights of creditors generally, (b)
the enforceability hereof or thereof is subject to general principles of equity,
or (c) the  indemnification  provisions  hereof or thereof  may be held to be in
violation of public policy.

                  (iii)  Upon  receipt  and  execution  of  this  Agreement  the
Placement Agent will promptly forward copies of this Agreement to the Company or
its counsel and the Investor or its counsel.

                  (iv)  The  Placement  Agent  will not  intentionally  take any
action  that it  reasonably  believes  would  cause the  Offering to violate the
provisions  of the  Securities  Act of 1933,  as amended (the "1933  Act"),  the
Securities  Exchange  Act of 1934 (the "1934  Act"),  the  respective  rules and
regulations  promulgated there under (the "Rules and Regulations") or applicable
"Blue Sky" laws of any state or jurisdiction.

                  (v) The  Placement  Agent will use all  reasonable  efforts to
determine  (a) whether the Investor is an  Accredited  Investor and (b) that any
information furnished by the Investor is true and accurate.  The Placement Agent
shall have no  obligation  to insure  that (x) any check,  note,  draft or other
means of payment  for the  Common  Stock will be  honored,  paid or  enforceable
against  the  Investor  in  accordance  with its  terms,  or (y)  subject to the
performance  of the  Placement  Agent's  obligations  and  the  accuracy  of the
Placement Agent's representations and warranties hereunder,  (1) the Offering is
exempt  from the  registration  requirements  of the 1933 Act or any  applicable
state "Blue Sky" law or (2) the Investor is an Accredited Investor.

                  (vi)  The  Placement   Agent  is  a  member  of  the  National
Association of Securities  Dealers,  Inc., and is a broker-dealer  registered as
such under the 1934 Act and under the securities laws of the states in which the
Securities  will be offered or sold by the  Placement  Agent unless an exemption
for such state  registration is available to the Placement  Agent. The Placement
Agent is in compliance with all material rules and regulations applicable to the
Placement Agent generally and applicable to the Placement Agent's  participation
in the Offering.

                                       2
<PAGE>

         4. Representations and Warranties of the Company.

         A. The Company represents and warrants as follows:

                  (i) The  execution,  delivery and  performance of each of this
Agreement,  the Equity Line of Credit Agreement,  the Escrow Agreement,  and the
Registration Rights Agreement has been or will be duly and validly authorized by
the Company and is, or with respect to this Agreement, the Equity Line of Credit
Agreement,  the Escrow Agreement, and the Registration Rights Agreement will be,
a valid and binding agreement of the Company, enforceable in accordance with its
respective  terms,  except to the extent that (a) the  enforceability  hereof or
thereof may be limited by bankruptcy, insolvency, reorganization,  moratorium or
similar laws from time to time in effect and  affecting  the rights of creditors
generally,  (b) the  enforceability  hereof or  thereof  is  subject  to general
principles of equity or (c) the indemnification provisions hereof or thereof may
be held to be in  violation  of  public  policy.  The  Securities  to be  issued
pursuant to the transactions  contemplated by this Agreement and the Equity Line
of Credit  Agreement have been duly  authorized and, when issued and paid for in
accordance  with  (x) this  Agreement,  the  Equity  Line of  Agreement  and the
certificates/instruments  representing  such  Securities,  (y) will be valid and
binding  obligations  of the  Company,  enforceable  in  accordance  with  their
respective terms,  except to the extent that (1) the enforceability  thereof may
be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
from time to time in effect and affecting the rights of creditors generally, and
(2) the  enforceability  thereof is subject to general principles of equity. All
corporate action required to be taken for the  authorization,  issuance and sale
of the Securities has been duly and validly taken by the Company.

                  (ii) The Company has a duly authorized, issued and outstanding
capitalization  as set forth herein and in the Equity Line of Credit  Agreement.
All issued and outstanding  securities of the Company, have been duly authorized
and  validly  issued;  the  holders  thereof  have no  rights of  rescission  or
preemptive rights with respect thereto and are not subject to personal liability
solely by reason of being security  holders;  and none of such  securities  were
issued in violation of the  preemptive  rights of any holders of any security of
the Company.  As of the date hereof, the authorized capital stock of the Company
consists of 200,000,000 shares of Common Stock, par value US$0.0001 per share of
which 66,959,872 shares of Common Stock are issued and outstanding.

                  (iii) The Common Stock  issued and to be issued in  accordance
with this  Agreement  and the  Equity  Line of Credit  Agreement  have been duly
authorized and when issued and paid for in accordance with this  Agreement,  the
Equity Line of Credit  Agreement and the  certificates/instruments  representing
such  Common  Stock,  were and  will be,  as the  case  maybe,  validly  issued,
fully-paid  and  non-assessable;  the  holders  thereof  will not be  subject to
personal  liability solely by reason of being such holders;  such Securities are
not and will not be  subject  to the  preemptive  rights  of any  holder  of any
security of the Company.

                                       3
<PAGE>

                  (iv)  Except  as  described  in the  Offering  Materials,  the
Company has good and  marketable  title to, or valid and  enforceable  leasehold
estates in, all items of real and  personal  property  necessary  to conduct its
business (including, without limitation, any real or personal property stated in
the Offering Materials to be owned or leased by the Company),  free and clear of
all liens, encumbrances,  claims, security interests and defects of any material
nature  whatsoever,  other than those set forth in the  Offering  Materials  and
liens for taxes not yet due and payable.

                  (v) Except as described in the Offering Materials, there is no
litigation or governmental  proceeding  pending or, to the best of the Company's
knowledge,  threatened  against,  or involving the properties or business of the
Company, except as set forth in the Offering Materials.

                  (vi)  The  Company  has been  duly  organized  and is  validly
existing  as a  corporation  in good  standing  under  the laws of the  State of
Delaware.  Except as set forth in the  Offering  Materials  and,  except for the
Company's subsidiary in China, the Company does not own or control,  directly or
indirectly,  an interest in any other  corporation,  partnership,  trust,  joint
venture or other business entity.  The Company is duly qualified or licensed and
in good  standing as a foreign  corporation  in each  jurisdiction  in which the
character of its operations  requires such  qualification or licensing and where
failure to so qualify would have a material  adverse effect on the Company.  The
Company has all requisite  corporate  power and authority,  and all material and
necessary authorizations,  approvals, orders, licenses, certificates and permits
of and from all  governmental  regulatory  officials  and bodies  (domestic  and
foreign) to conduct its businesses  (and proposed  business) as described in the
Offering  Materials.  Any disclosures in the Offering  Materials  concerning the
effects  of  foreign,  federal,  state and  local  regulation  on the  Company's
businesses  as  currently  conducted  and as  contemplated  are  correct  in all
material  respects and do not omit to state a material fact. The Company has all
corporate power and authority to enter into this  Agreement,  the Equity Line of
Credit Agreement,  the Registration Rights Agreement,  and the Escrow Agreement,
to carry out the provisions and conditions hereof and thereof, and all consents,
authorizations,  approvals  and  orders  required  in  connection  herewith  and
therewith  have been  obtained.  No consent,  authorization  or order of, and no
filing  with,  any court,  government  agency or other body is  required  by the
Company for the  issuance of the  Securities  or  execution  and delivery of the
Offering  Materials except for applicable federal and state securities laws. The
Company, since its inception, has not incurred any liability arising under or as
a result of the  application  of any of the provisions of the 1933 Act, the 1934
Act or the Rules and Regulations.

                  (vii)  There  has  been  no  material  adverse  change  in the
condition or prospects of the Company,  financial or otherwise,  from the latest
dates as of which such  condition or prospects,  respectively,  are set forth in
the Offering Materials,  and the outstanding debt, the property and the business
of the Company  conform in all  material  respects to the  descriptions  thereof
contained in the Offering Materials.

                  (viii)  Except as set  forth in the  Offering  Materials,  the
Company is not in breach of, or in default  under,  any term or provision of any
material indenture, mortgage, deed of trust, lease, note, loan or Equity Line of
Credit  Agreement or any other  material  agreement or instrument  evidencing an
obligation for borrowed money, or any other material  agreement or instrument to
which  it is a party or by  which  it or any of its  properties  may be bound or
affected.  The Company is not in  violation  of any  provision of its charter or
by-laws or in violation of any franchise,  license, permit, judgment,  decree or
order, or in violation of any material statute, rule or regulation.  Neither the
execution  and delivery of the Offering  Materials  nor the issuance and sale or
delivery of the  Securities,  nor the  consummation  of any of the  transactions
contemplated  in the Offering  Materials nor the  compliance by the Company with
the terms and provisions hereof or thereof, has conflicted with or will conflict
with,  or has  resulted  in or will  result in a breach of, any of the terms and
provisions  of, or has  constituted or will  constitute a default under,  or has
resulted in or will result in the creation or imposition of any lien,  charge or
encumbrance  upon any property or assets of the Company or pursuant to the terms
of any indenture,  mortgage, deed of trust, note, loan or any other agreement or
instrument  evidencing an obligation for borrowed  money, or any other agreement
or  instrument to which the Company may be bound or to which any of the property
or assets of the Company is subject except (a) where such default,  lien, charge
or encumbrance  would not have a material  adverse effect on the Company and (b)
as  described  in the  Offering  Materials;  nor will such action  result in any
violation  of the  provisions  of the  charter or the by-laws of the Company or,
assuming  the  due  performance  by  the  Placement  Agent  of  its  obligations
hereunder,  any  material  statute or any  material  order,  rule or  regulation
applicable  to the  Company of any court or of any  foreign,  federal,  state or
other regulatory authority or other government body having jurisdiction over the
Company.

                                       4
<PAGE>

                  (ix) Subsequent to the dates as of which  information is given
in  the  Offering  Materials,  and  except  as may  otherwise  be  indicated  or
contemplated  herein or therein,  the Company has not (a) incurred any liability
or obligation, direct or contingent, for borrowed money, or (b) entered into any
transaction  other than in the ordinary  course of business,  or (c) declared or
paid any dividend or made any other distribution on or in respect of its capital
stock.  Except as  described  in the  Offering  Materials,  the  Company  has no
outstanding obligations to any officer or director of the Company.

                  (x)  There  are no  claims  for  services  in the  nature of a
finder's or origination  fee with respect to the sale of the Common Stock or any
other  arrangements,  agreements or understandings that may affect the Placement
Agent's  compensation,  as determined by the National  Association of Securities
Dealers, Inc.

                  (xi) Except for the royalty  payments to NewTech  Group and as
set forth on the Offering  Materials,  the Company owns or  possesses,  free and
clear of all liens or  encumbrances  and  rights  thereto  or  therein  by third
parties,  the requisite licenses or other rights to use all trademarks,  service
marks, copyrights,  service names, trade names, patents, patent applications and
licenses necessary to conduct its business (including,  without limitation,  any
such  licenses or rights  described in the Offering  Materials as being owned or
possessed by the Company)  and,  except as set forth in the Offering  Materials,
there is no claim or action by any person pertaining to, or proceeding,  pending
or threatened, which challenges the exclusive rights of the Company with respect
to any  trademarks,  service  marks,  copyrights,  service  names,  trade names,
patents,  patent  applications and licenses used in the conduct of the Company's
businesses (including, without limitation, any such licenses or rights described
in the Offering Materials as being owned or possessed by the Company) except any
claim or action that would not have a material  adverse  effect on the  Company;
the Company's  current  products,  services or processes do not infringe or will
not infringe on the patents currently held by any third party.

                                       5
<PAGE>

                  (xii)  Except as  described  in the  Offering  Materials,  the
Company  is not  under  any  obligation  to pay  royalties  or fees of any  kind
whatsoever  to any third party with respect to any  trademarks,  service  marks,
copyrights,  service names, trade names, patents, patent applications,  licenses
or technology it has developed, uses, employs or intends to use or employ, other
than to their respective licensors.

                  (xiii) Subject to the  performance  by the Placement  Agent of
its obligations  hereunder and the offer and sale of the Securities  comply, and
will continue to comply in all material  respects with the  requirements of Rule
506 of  Regulation  D  promulgated  by the SEC  pursuant to the 1933 Act and any
other  applicable  federal  and state laws,  rules,  regulations  and  executive
orders.  Neither the Offering  Materials nor any amendment or supplement thereto
nor any documents  prepared by the Company in connection  with the Offering will
contain any untrue  statement  of a material  fact or omit to state any material
fact required to be stated therein or necessary to make the statements  therein,
in light of the  circumstances  under which they were made, not misleading.  All
statements of material  facts in the Offering  Materials are true and correct as
of the date of the Offering Materials.

                  (xiv) All  material  taxes which are due and payable  from the
Company  have been  paid in full or  adequate  provision  has been made for such
taxes on the books of the Company  except for those taxes disputed in good faith
the Company does not have any tax  deficiency or claim  outstanding  assessed or
proposed against it.

                  (xv) None of the Company nor any of its  officers,  directors,
employees or agents, nor any other person acting on behalf of the Company,  has,
directly  or  indirectly,  given or agreed to give any  money,  gift or  similar
benefit (other than legal price  concessions to customers in the ordinary course
of  business)  to any  customer,  supplier,  employee  or agent of a customer or
supplier,  or official or employee of any governmental agency or instrumentality
of any government  (domestic or foreign) or any political party or candidate for
office  (domestic  or foreign) or other person who is or may be in a position to
help or hinder the business of the Company (or assist it in connection  with any
actual or  proposed  transaction)  which (A) might  subject  the  Company to any
damage  or  penalty  in  any  civil,  criminal  or  governmental  litigation  or
proceeding, or (B) if not given in the past, might have had a materially adverse
effect on the assets,  business or operations of the Company as reflected in any
of the financial statements  contained in the Offering Materials,  or (C) if not
continued in the future, might adversely affect the assets, business, operations
or prospects of the Company in the future.

         5. Representations, Warranties and Covenants of the Investor.

         A. The Investor represents, warrants and covenants as follows:

                  (i) The  Investor has the  necessary  power to enter into this
Agreement and to consummate the transactions contemplated hereby .

                  (ii)  The  execution  and  delivery  by the  Investor  of this
Agreement and the consummation of the transactions  contemplated herein will not
result in any  violation  of, or be in conflict  with,  or  constitute a default
under,  any agreement or instrument to which the Investor is a party or by which
the Investor or its properties are bound, or any judgment,  decree, order or, to
the  Investor's  knowledge,  any statute,  rule or regulation  applicable to the
Investor.  This  Agreement  when executed and  delivered by the  Investor,  will
constitute the legal, valid and binding obligations of the Investor, enforceable
in accordance  with their  respective  terms,  except to the extent that (a) the
enforceability  hereof or  thereof  may be limited  by  bankruptcy,  insolvency,
reorganization,  moratorium  or  similar  laws from  time to time in effect  and
affecting the rights of creditors  generally,  (b) the enforceability  hereof or
thereof is subject to general  principles of equity, or (c) the  indemnification
provisions hereof or thereof may be held to be in violation of public policy.

                                       6
<PAGE>

                  (iii) The Investor will promptly forward copies of any and all
due diligence questionnaires compiled by the Investor to the Placement Agent.

         6. Certain Covenants and Agreements of the Company.

         The Company covenants and agrees at its expense and without any expense
to the Placement Agent as follows:

         A. To advise the Placement Agent of any material  adverse change in the
Company's  financial  condition,  prospects  or business  or of any  development
materially  affecting the Company or rendering untrue or misleading any material
statement in the Offering Materials occurring at any time as soon as the Company
is either informed or becomes aware thereof.

         B. To use its commercially reasonable efforts to cause the Common Stock
issuable  in  connection  with the  Equity  Line of  Credit to be  qualified  or
registered for sale on terms  consistent  with those stated in the  Registration
Rights Agreement.

         C. Upon  written  request,  to provide  and  continue  to  provide  the
Placement  Agent and the Investor copies of all quarterly  financial  statements
and audited annual financial statements prepared by or on behalf of the Company,
other reports prepared by or on behalf of the Company for public  disclosure and
all documents delivered to the Company's stockholders.

         D. To deliver, during the registration period of the Equity Line Credit
Agreement,  to the Placement Agent upon the Placement  Agent's  request,  within
forty five (45) days, a statement of its income for each such quarterly  period,
and its balance sheet and a statement of changes in  stockholders'  equity as of
the end of such quarterly  period,  all in reasonable  detail,  certified by its
principal  financial or accounting  officer;  (ii) within ninety (90) days after
the close of each fiscal year,  its balance sheet as of the close of such fiscal
year,   together  with  a  statement  of  income,  a  statement  of  changes  in
stockholders'  equity and a statement  of cash flow for such fiscal  year,  such
balance sheet, statement of income, statement of changes in stockholders' equity
and statement of cash flow to be in reasonable  detail and accompanied by a copy
of the  certificate  or  report  thereon  of  independent  auditors  if  audited
financial  statements are prepared;  and (iii) a copy of all documents,  reports
and information  furnished to its  stockholders at the time that such documents,
reports and information are furnished to its stockholders.

         E. To comply with the terms of the Offering Materials.

                                       7
<PAGE>

         F. To ensure that any transactions between or among the Company, or any
of its officers, directors and affiliates be on terms and conditions that are no
less  favorable  to the  Company,  than the terms and  conditions  that would be
available in an "arm's length" transaction with an independent third party.

         7. Indemnification.

         A.  The  Company  hereby  agrees  that it will  indemnify  and hold the
Placement   Agent  and  each  officer,   director,   shareholder,   employee  or
representative of the Placement Agent and each person controlling, controlled by
or under common  control with the Placement  Agent within the meaning of Section
15 of the  1933  Act or  Section  20 of the  1934  Act or the  SEC's  Rules  and
Regulations promulgated there under (the "Rules and Regulations"), harmless from
and  against  any  and all  loss,  claim,  damage,  liability,  cost or  expense
whatsoever (including, but not limited to, any and all reasonable legal fees and
other  expenses and  disbursements  incurred in connection  with  investigating,
preparing to defend or defending any action,  suit or proceeding,  including any
inquiry or investigation, commenced or threatened, or any claim whatsoever or in
appearing  or  preparing  for  appearance  as a witness in any  action,  suit or
proceeding,  including any inquiry, investigation or pretrial proceeding such as
a deposition)  to which the Placement  Agent or such  indemnified  person of the
Placement  Agent may become  subject under the 1933 Act, the 1934 Act, the Rules
and Regulations, or any other federal or state law or regulation,  common law or
otherwise,  arising  out of or based  upon (i) any untrue  statement  or alleged
untrue  statement  of a  material  fact  contained  in  (a)  Section  4 of  this
Agreement,  (b) the Offering Materials (except those written statements relating
to the Placement  Agent given by an indemnified  person for inclusion  therein),
(c) any application or other document or written  communication  executed by the
Company or based upon written information  furnished by the Company filed in any
jurisdiction  in order to qualify  the Common  Stock under the  securities  laws
thereof,  or any state  securities  commission  or agency;  (ii) the omission or
alleged omission from documents  described in clauses (a), (b) or (c) above of a
material fact required to be stated  therein or necessary to make the statements
therein not  misleading;  or (iii) the breach of any  representation,  warranty,
covenant or agreement made by the Company in this Agreement. The Company further
agrees that upon demand by an  indemnified  person,  at any time or from time to
time, it will promptly  reimburse such indemnified  person for any loss,  claim,
damage,  liability,  cost  or  expense  actually  and  reasonably  paid  by  the
indemnified  person as to which the Company has indemnified such person pursuant
hereto.  Notwithstanding  the foregoing  provisions of this Paragraph  6(A), any
such payment or reimbursement by the Company of fees,  expenses or disbursements
incurred by an indemnified person in any proceeding in which a final judgment by
a court of competent  jurisdiction  (after all appeals or the expiration of time
to appeal) is entered  against the Placement  Agent or such  indemnified  person
based upon specific finding of fact that the Placement Agent or such indemnified
person's gross negligence or willful  misfeasance will be promptly repaid to the
Company.

         B. The Placement  Agent hereby  agrees that it will  indemnify and hold
the Company and each officer, director, shareholder,  employee or representative
of the  Company,  and each person  controlling,  controlled  by or under  common
control  with the  Company  within the  meaning of Section 15 of the 1933 Act or
Section  20 of the 1934 Act or the  Rules  and  Regulations,  harmless  from and
against any and all loss, claim, damage,  liability,  cost or expense whatsoever
(including,  but not  limited  to, any and all  reasonable  legal fees and other
expenses and disbursements incurred in connection with investigating,  preparing
to defend or defending any action, suit or proceeding,  including any inquiry or
investigation,  commenced or threatened, or any claim whatsoever or in appearing
or preparing  for  appearance  as a witness in any action,  suit or  proceeding,
including  any  inquiry,   investigation  or  pretrial   proceeding  such  as  a
deposition) to which the Company or such  indemnified  person of the Company may
become subject under the 1933 Act, the 1934 Act, the Rules and  Regulations,  or
any other federal or state law or regulation,  common law or otherwise,  arising
out of or based upon (i) the  conduct of the  Placement  Agent or its  officers,
employees or  representatives  in its acting as Placement Agent for the Offering
or (ii)  the  material  breach  of any  representation,  warranty,  covenant  or
agreement  made by the  Placement  Agent in this  Agreement  (iii)  any false or
misleading  information  provided to the Company by one of the Placement Agent's
indemnified persons.

                                       8
<PAGE>

         C. The  Investor  hereby  agrees  that it will  indemnify  and hold the
Placement   Agent  and  each  officer,   director,   shareholder,   employee  or
representative of the Placement Agent, and each person  controlling,  controlled
by or under  common  control  with the  Placement  Agent  within the  meaning of
Section  15 of the 1933 Act or  Section  20 of the  1934  Act or the  Rules  and
Regulations,  harmless  from  and  against  any and  all  loss,  claim,  damage,
liability,  cost or expense whatsoever  (including,  but not limited to, any and
all  reasonable  legal fees and other  expenses  and  disbursements  incurred in
connection with investigating, preparing to defend or defending any action, suit
or proceeding, including any inquiry or investigation,  commenced or threatened,
or any claim whatsoever or in appearing or preparing for appearance as a witness
in any action,  suit or  proceeding,  including  any inquiry,  investigation  or
pretrial  proceeding  such as a deposition) to which the Placement Agent or such
indemnified person of the Placement Agent may become subject under the 1933 Act,
the 1934 Act, the Rules and  Regulations,  or any other  federal or state law or
regulation,  common  law or  otherwise,  arising  out of or  based  upon (i) the
conduct of the Investor or its  officers,  employees or  representatives  in its
acting as the  Investor  for the  Offering  or (ii) the  material  breach of any
representation,  warranty,  covenant or  agreement  made by the  Investor in the
Offering  Materials  (iii) any false or misleading  information  provided to the
Placement Agent by one of the Investor's indemnified persons.

         D. The Placement  Agent hereby  agrees that it will  indemnify and hold
the Investor and each officer, director, shareholder, employee or representative
of the  Investor,  and each person  controlling,  controlled  by or under common
control  with the  Investor  within the meaning of Section 15 of the 1933 Act or
Section  20 of the 1934 Act or the  Rules  and  Regulations,  harmless  from and
against any and all loss, claim, damage,  liability,  cost or expense whatsoever
(including,  but not  limited  to, any and all  reasonable  legal fees and other
expenses and disbursements incurred in connection with investigating,  preparing
to defend or defending any action, suit or proceeding,  including any inquiry or
investigation,  commenced or threatened, or any claim whatsoever or in appearing
or preparing  for  appearance  as a witness in any action,  suit or  proceeding,
including  any  inquiry,   investigation  or  pretrial   proceeding  such  as  a
deposition) to which the Investor or such indemnified person of the Investor may
become subject under the 1933 Act, the 1934 Act, the Rules and  Regulations,  or
any other federal or state law or regulation,  common law or otherwise,  arising
out of or based upon (i) the  conduct of the  Placement  Agent or its  officers,
employees  or  representatives  in its  acting  as the  Placement  Agent for the
Offering or (ii) the material breach of any representation,  warranty,  covenant
or agreement made by the Placement  Agent in this  Agreement  (iii) any false or
misleading  information provided to the Investor by one of the Placement Agent's
indemnified persons.

                                       9
<PAGE>

         E.  Promptly  after  receipt  by an  indemnified  party  of  notice  of
commencement  of any action covered by Section 7(A),  (B), (C) or (D), the party
to be indemnified shall,  within five (5) business days, notify the indemnifying
party of the commencement  thereof; the omission by one (1) indemnified party to
so notify the indemnifying party shall not relieve the indemnifying party of its
obligation to indemnify any other  indemnified  party that has given such notice
and shall not relieve the  indemnifying  party of any liability  outside of this
indemnification  if not  materially  prejudiced  thereby.  In the event that any
action is brought against the indemnified  party, the indemnifying party will be
entitled to participate  therein and, to the extent it may desire, to assume and
control  the  defense  thereof  with  counsel  chosen by it which is  reasonably
acceptable to the indemnified party. After notice from the indemnifying party to
such  indemnified  party of its election to so assume the defense  thereof,  the
indemnifying  party  will not be liable to such  indemnified  party  under  such
Section  7(A),  (B),  (C), or (D) for any legal or other  expenses  subsequently
incurred by such indemnified  party in connection with the defense thereof,  but
the  indemnified  party may, at its own expense,  participate in such defense by
counsel  chosen by it,  without,  however,  impairing the  indemnifying  party's
control  of  the  defense.   Subject  to  the  proviso  of  this   sentence  and
notwithstanding  any other  statement  to the  contrary  contained  herein,  the
indemnified  party or  parties  shall  have the right to choose its or their own
counsel  and  control  the  defense  of any  action,  all at the  expense of the
indemnifying  party if,  (i) the  employment  of such  counsel  shall  have been
authorized in writing by the  indemnifying  party in connection with the defense
of  such  action  at  the  expense  of  the  indemnifying  party,  or  (ii)  the
indemnifying  party shall not have employed counsel  reasonably  satisfactory to
such  indemnified  party to have charge of the  defense of such action  within a
reasonable  time  after  notice of  commencement  of the  action,  or (iii) such
indemnified  party or parties shall have reasonably  concluded that there may be
defenses available to it or them which are different from or additional to those
available  to one  or  all  of the  indemnifying  parties  (in  which  case  the
indemnifying  parties  shall not have the right to direct  the  defense  of such
action on behalf of the  indemnified  party or parties),  in any of which events
such  fees  and  expenses  of one  additional  counsel  shall  be  borne  by the
indemnifying party; provided, however, that the indemnifying party shall not, in
connection with any one action or separate but substantially  similar or related
actions in the same jurisdiction  arising out of the same general allegations or
circumstance,  be liable for the  reasonable  fees and expenses of more than one
separate  firm of attorneys  at any time for all such  indemnified  parties.  No
settlement of any action or  proceeding  against an  indemnified  party shall be
made without the consent of the indemnifying party.

         F.  In  order  to  provide  for  just  and  equitable  contribution  in
circumstances in which the indemnification  provided for in Section 7(A) or 7(B)
is due in accordance  with its terms but is for any reason held by a court to be
unavailable  on grounds of policy or  otherwise,  the Company and the  Placement
Agent shall contribute to the aggregate losses,  claims, damages and liabilities
(including  legal or other expenses  reasonably  incurred in connection with the
investigation  or defense of same) which the other may incur in such  proportion
so that the  Placement  Agent  shall be  responsible  for  such  percent  of the
aggregate of such losses,  claims,  damages and  liabilities  as shall equal the
percentage of the gross  proceeds  paid to the  Placement  Agent and the Company
shall be responsible for the balance;  provided,  however, that no person guilty
of fraudulent  misrepresentation within the meaning of Section 11(f) of the 1933
Act shall be entitled to contribution from any person who was not guilty of such
fraudulent  misrepresentation.  For  purposes of this Section  7(F),  any person
controlling,  controlled by or under common control with the Placement Agent, or
any partner,  director,  officer,  employee,  representative or any agent of any
thereof,  shall have the same rights to  contribution as the Placement Agent and
each person controlling,  controlled by or under common control with the Company
within  the  meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act
and each officer of the Company and each  director of the Company shall have the
same rights to contribution  as the Company.  Any party entitled to contribution
will,  promptly after receipt of notice of commencement  of any action,  suit or
proceeding  against such party in respect of which a claim for  contribution may
be made against the other party under this Section 7(D),  notify such party from
whom contribution may be sought,  but the omission to so notify such party shall
not relieve the party from whom  contribution  may be sought from any obligation
they may have hereunder or otherwise if the party from whom  contribution may be
sought is not  materially  prejudiced  thereby.  The indemnity and  contribution
agreements  contained in this Section 7 shall remain operative and in full force
and  effect  regardless  of  any  investigation  made  by or on  behalf  of  any
indemnified person or any termination of this Agreement.

                                       10
<PAGE>

         8. Payment of Expenses.

         The Company  hereby  agrees to bear all of the  expenses in  connection
with the Offering,  including,  but not limited to the  following:  filing fees,
printing and duplicating costs, postage and mailing expenses with respect to the
transmission of Offering  Materials,  registrar and transfer agent fees,  escrow
agent fees and expenses,  fees of the Company's  counsel and accountants,  issue
and transfer taxes, if any.

         9. Conditions of Closing.

         The  Closing  shall  be  held at the  offices  of the  Investor  or its
counsel.  The  obligations of the Placement  Agent hereunder shall be subject to
the  continuing  accuracy of the  representations  and warranties of the Company
herein as of the date hereof and as of the Date of Closing (the "Closing  Date")
with  respect to the  Company  as if it had been made on and as of such  Closing
Date;  the  accuracy  on and as of the  Closing  Date of the  statements  of the
officers  of the  Company  made  pursuant  to the  provisions  hereof;  and  the
performance  by the Company on and as of the Closing Date of its  covenants  and
obligations hereunder and to the following further conditions:

         A. Upon the  effectiveness  of a  registration  statement  covering the
Equity Line of Credit  Agreement,  the Placement Agent shall receive the opinion
of Counsel to the Company,  dated as of the date thereof, which opinion shall be
in form and substance reasonably satisfactory to the Investor, their counsel and
the Placement Agent.

         B. At or prior to the  Closing,  the  Placement  Agent  shall have been
furnished such documents, certificates and opinions as it may reasonably require
for the purpose of enabling them to review or pass upon the matters  referred to
in this  Agreement  and the  Offering  Materials,  or in order to  evidence  the
accuracy, completeness or satisfaction of any of the representations, warranties
or conditions herein contained.

         C. At and prior to the  Closing,  (i) there shall have been no material
adverse change nor development  involving a prospective  change in the condition
or prospects or the business activities,  financial or otherwise, of the Company
from the latest  dates as of which such  condition  is set forth in the Offering
Materials; (ii) there shall have been no transaction, not in the ordinary course
of business  which has not been  disclosed in the  Offering  Materials or to the
Placement Agent in writing; (iii) except as set forth in the Offering Materials,
the  Company  shall not be in  default  under any  provision  of any  instrument
relating to any outstanding indebtedness for which a waiver or extension has not
been otherwise received;  and (iv) no action,  suit or proceeding,  at law or in
equity,  against the Company or affecting  any of its  properties  or businesses
shall be  pending  or  threatened  before  or by any court or  federal  or state
commission,  board or other administrative agency, domestic or foreign,  wherein
an unfavorable decision, ruling or finding could materially adversely affect the
businesses, prospects or financial condition or income of the Company, except as
set forth in the Offering Materials.

                                       11
<PAGE>

         D. At Closing,  the Placement  Agent shall receive a certificate of the
Company signed by an executive officer and chief financial officer,  dated as of
the  applicable  Closing,  to the  effect  that  the  conditions  set  forth  in
subparagraph  (C) above  have been  satisfied  and  that,  as of the  applicable
closing,  the representations and warranties of the Company set forth herein are
true and correct.

         10. Termination.

         This Agreement  shall be co-terminus  with, and terminate upon the same
terms and conditions as those set forth in, the Equity Line of Credit Agreement.
The  rights  of the  Investor  and the  obligations  of the  Company  under  the
Registration  Rights  Agreement,  and the rights of the Placement  Agent and the
obligations  of the Company  shall  survive the  termination  of this  Agreement
unabridged.

         11. Miscellaneous.

         A. This Agreement may be executed in any number of  counterparts,  each
of which shall be deemed to be an original,  but all which shall be deemed to be
one and the same instrument.

         B. Any notice  required or  permitted  to be given  hereunder  shall be
given in writing  and shall be deemed  effective  when  deposited  in the United
States mail, postage prepaid, or when received if personally  delivered or faxed
(upon  confirmation  of receipt  received by the sending  party),  addressed  as
follows:

                                       12
<PAGE>

<TABLE>
<CAPTION>
<S>                                            <C>
If to Placement Agent, to:                     Westrock Advisors, Inc.
                                               230 Park Avenue, Floor 9
                                               New York, New York 10069
                                               Telephone:        (_____) __________
                                               Facsimile:        (_____) __________

If to the Company, to:                         NewTech Brake Corp.
                                               779 Industrial Boulevard
                                               Blainville, Quebec Canada J7C3V3
                                               Attention:        Yvon Rancourt
                                                                 Chairman
                                               Telephone:        (450) 434-6432
                                               Facsimile:        (450) 434-5071

With a copy to:                                Kirkpatrick & Lockhart LLP
                                               201 South Biscayne Boulevard, Suite 2000
                                               Miami, Florida 33131
                                               Attention:        Clayton E. Parker, Esquire
                                               Telephone:        (305) 539-3300
                                               Facsimile:        (305) 358 7095

If to the Investor:                            Cornell Capital Partners, LP
                                               101 Hudson Street - Suite 3606
                                               Jersey City, New Jersey  07302
                                               Attention:        Mark A. Angelo
                                                                 Portfolio Manager
                                               Telephone:        (201) 985-8300
                                               Facsimile:        (201) 985-8266

With Copies to:                                Butler Gonzalez LLP
                                               1000 Stuyvesant Avenue - Suite No. 6
                                               Union, New Jersey  07083
                                               Attention:        David Gonzalez, Esq.
                                               Telephone:        (908) 810-8588
                                               Facsimile:        (908) 810-0973
</TABLE>

or to such other address of which written notice is given to the others.

         C. This  Agreement  shall be governed by and  construed in all respects
under the laws of the State of  Delaware,  without  reference to its conflict of
laws rules or principles. Any suit, action, proceeding or litigation arising out
of or relating to this Agreement shall be brought and prosecuted in such federal
or state  court or courts  located  within the State of New York as  provided by
law.  The  parties  hereby  irrevocably  and  unconditionally   consent  to  the
jurisdiction  of each such court or courts  located within the State of New York
and to service of  process by  registered  or  certified  mail,  return  receipt
requested,  or by any other  manner  provided  by  applicable  law,  and  hereby
irrevocably and unconditionally  waive any right to claim that any suit, action,
proceeding  or litigation  so commenced  has been  commenced in an  inconvenient
forum.

         D. This Agreement and the other  agreements  referenced  herein contain
the entire  understanding  between the parties hereto and may not be modified or
amended except by a writing duly signed by the party against whom enforcement of
the modification or amendment is sought.

                                       13
<PAGE>

         E. If any  provision of this  Agreement  shall be held to be invalid or
unenforceable,  such invalidity or  unenforceability  shall not affect any other
provision of this Agreement.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       14
<PAGE>

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

                                    COMPANY:
                                    NEWTECH BRAKE CORP.

                                    By: /s/ Yvon Rancourt
                                        -----------------------------------
                                    Name:    Yvon Rancourt
                                    Title:   Chairman

                                    PLACEMENT AGENT:
                                    WESTROCK ADVISORS, INC.

                                    By:
                                        -----------------------------------
                                    Name:
                                    Title:

                                    INVESTOR:
                                    CORNELL CAPITAL PARTNERS, LP

                                    BY:      YORKVILLE ADVISORS, LLC
                                    ITS:     GENERAL PARTNER

                                    By: /s/ Mark A. Angelo
                                        -----------------------------------
                                    Name:    Mark A. Angelo
                                    Title:   Portfolio Manager

                                       15<PAGE>

                                                                    EXHIBIT 4.18

THE SECURITIES  REPRESENTED BY THIS CERTIFICATE ARE NOT TRANSFERABLE WITHOUT THE
EXPRESS WRITTEN CONSENT OF MANHATTAN  PHARMACEUTICALS,  INC. (THE "COMPANY") AND
HAVE NOT BEEN  REGISTERED  UNDER THE SECURITIES ACT OF 1933, AS AMENDED,  OR ANY
APPLICABLE STATE SECURITIES LAWS, AND MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED
OR  HYPOTHECATED  OR  OTHERWISE  TRANSFERRED  IN THE  ABSENCE OF A  REGISTRATION
STATEMENT  IN  EFFECT  WITH  RESPECT  TO THE  SECURITIES  UNDER  SUCH  ACT OR AN
EXEMPTION  THEREFROM.  ANY SUCH TRANSFER MAY ALSO BE SUBJECT TO APPLICABLE STATE
SECURITIES LAWS.

                         MANHATTAN PHARMACEUTICALS, INC.

                      Warrant for the Purchase of Shares of
                                  Common Stock

CSW No. ___S                                                       [____] Shares

                  FOR  VALUE  RECEIVED,   MANHATTAN  PHARMACEUTICALS,   INC.,  a
Delaware corporation (the "COMPANY"),  hereby certifies that MAXIM GROUP, LLC or
its registered  assigns (the "Holder") is entitled to purchase from the Company,
subject to the provisions of this Warrant,  at any time commencing from the date
hereof  until  5:00  p.m.  (New  York  City  time)  on  November  5,  2008  (the
"TERMINATION  DATE"),  __________________________  fully paid and non-assessable
shares of Common Stock,  at an initial per share  exercise price equal to $1.10.
The shares of Common Stock or other securities or property deliverable upon such
exercise are  hereinafter  sometimes  referred to as the  "WARRANT  SHARES." The
exercise  price of a share of Common Stock in effect at any time is  hereinafter
sometimes  referred  to as the "PER  SHARE  EXERCISE  PRICE"  and the  aggregate
purchase price payable for the Warrant Shares hereunder is hereinafter sometimes
referred to as the  "AGGREGATE  EXERCISE  PRICE."  This Warrant is one of a duly
authorized  issue of  Warrants  constituting  components  of  units  sold by the
Company on the date hereof (collectively, the "WARRANTS").

                  1. DEFINITIONS.

                  "CHANGE OF CONTROL" means the (i) acquisition by an individual
or legal  entity or group (as defined in Rule 13d-5 of the  Securities  Exchange
Act of 1934,  as amended) of more than  one-half of the voting  rights or equity
interests in the Company; (ii) sale, conveyance,  or other disposition of all or
substantially all of the assets,  property or business of the Company, (iii) any
reclassification   of  the  Company's  capital,  or  (iv)  the  merger  into  or
consolidation  with any other  corporation  or other entity (other than a wholly
owned  subsidiary  corporation)  or effectuation of any transaction or series of
related  transactions  where holders of the Company's voting securities prior to
such transaction or series of transactions fail to continue to hold at least 50%
of the voting power of the Company.

                                        1

<PAGE>

                  "COMMON  STOCK"  means  (except  where the  context  otherwise
indicates)  the Common  Stock,  $0.001 par value per  share,  of the  Company as
constituted  on the date  hereof,  and any capital  stock into which such Common
Stock may thereafter be changed or converted, and shall also include (i) capital
stock of the Company of any other class  (regardless of how denominated)  issued
to the holders of shares of Common Stock upon any reclassification thereof which
is also not  preferred as to dividends or assets on  liquidation  over any other
class of stock of the Company and which is not  subject to  redemption  and (ii)
shares of common stock of any successor or acquiring  corporation received by or
distributed  to the holders of Common Stock of the Company in the  circumstances
contemplated by Section 5.3.

                  2. EXERCISE OF WARRANT.

                  (a) This Warrant may be exercised in whole or in part,  at any
time by the Holder  commencing upon the date hereof and prior to the Termination
Date:

                           (i) by  presentation  and  surrender  of this Warrant
(with the subscription  form at the end hereof duly executed) at the address set
forth in Section 11 hereof, together with payment, by certified or official bank
check payable to the order of the Company,  of the Aggregate  Exercise  Price or
the proportionate part thereof if exercised in part; 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 11 hereof.  Such  presentation and surrender
shall  be  deemed a  waiver  of the  Holder's  obligation  to pay the  Aggregate
Exercise Price, or the  proportionate  part thereof if this Warrant is exercised
in part.  In the event of a Cashless  Exercise,  the Holder shall  exchange this
Warrant  for that number of Warrant  Shares  subject to such  Cashless  Exercise
multiplied by a fraction, the numerator of which shall be the difference between
(A) the last sale price 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 Board of  Directors  (the  "Current  Market
Price") and (B) the Per Share Exercise Price, and the denominator of which shall
be the then Current  Market Price.  For purposes of any  computation  under this
Section  2(a),  the then Current  Market Price shall be based on the trading day
immediately prior to the Cashless Exercise.

                                        2

<PAGE>

                  (b) If this  Warrant is  exercised  in part only,  the Company
shall, upon presentation of this Warrant upon such exercise, execute and deliver
(with the certificate for the Warrant Shares purchased) a new Warrant evidencing
the rights of the Holder  hereof to purchase  the balance of the Warrant  Shares
purchasable  hereunder  upon the same terms and  conditions as herein set forth.
Upon  proper  exercise  of this  Warrant,  the Company  promptly  shall  deliver
certificates for the Warrant Shares to the Holder duly legended as authorized by
the subscription  form together with cash in lieu of any fraction of a share, as
hereinafter  provided,  but, in any event,  within three (3) business days after
such  exercise.  No  fractional  shares  shall be issued  upon  exercise of this
Warrant.  With  respect to any  fraction  of a share  called  for upon  exercise
hereof,  the  Company  shall pay to the  Holder an amount in cash  equal to such
fraction  multiplied  by the  Current  Market  Price of one (1)  share of Common
Stock.  The stock  certificate  or  certificates  so delivered  shall be, to the
extent  possible,  in such  denomination  or  denominations  as the Holder shall
request in the notice and shall be  registered in the name of the Holder or such
other name as shall be designated by the Holder. This Warrant shall be deemed to
have been exercised and such certificate or certificates shall be deemed to have
been  issued,  and the  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 when the  notice,  together  with the  payment  of the
applicable  exercise  price and this  Warrant,  is  received  by the  Company as
described above.

                  3.  RESERVATION OF WARRANT SHARES;  FULLY PAID SHARES;  TAXES.
The Company hereby  undertakes  until  expiration of this Warrant to reserve for
issuance or delivery upon exercise of this Warrant, such number of shares of the
Common Stock as shall be required for issuance  and/or delivery upon exercise of
this Warrant in full in accordance  with the terms  hereof,  and agrees that all
Warrant Shares so issued and/or  delivered shall be validly  issued,  fully paid
and  non-assessable and not subject to any preemptive rights, and further agrees
to pay all taxes and  charges  that may be  imposed  upon such  issuance  and/or
delivery.

                  4. REGISTRATION UNDER SECURITIES ACT OF 1933, AS AMENDED.  The
Holder of this Warrant shall be entitled to registration  rights with respect to
the Warrant Shares to the same extent and on the same terms as those provided to
investors pursuant to Article V of the Subscription Agreement (the "Subscription
Agreement")  dated October ____,  2003 between the Company and purchasers of the
Company's Series A Convertible  Preferred Stock. If the Holder is not a party to
the Subscription  Agreement,  by acceptance of this Warrant the Holder agrees to
comply with  provisions  of Article V thereof to the same extent as if it were a
party thereto.

                  5. ADJUSTMENTS. The number of shares of Common Stock for which
this Warrant is exercisable, and the price at which such shares may be purchased
upon exercise of this Warrant,  shall be subject to adjustment from time to time
as set forth in this Section 5. The Company  shall give the Holder notice of any
event described below which requires an adjustment pursuant to this Section 5 in
accordance with Sections 6.1 and 6.2.

                  5.1 Stock Dividends,  Subdivisions and Combinations. If at any
time while this Warrant is outstanding the Company shall:

                           i. take a record of the  holders of its Common  Stock
                  for the  purpose  of  entitling  them to  receive  a  dividend
                  payable in, or other  distribution  of,  additional  shares of
                  Common Stock,

                           ii. subdivide its outstanding  shares of Common Stock
                  into a larger number of shares of Common Stock, or

                                        3

<PAGE>

                           iii.  combine its outstanding  shares of Common Stock
                  into a smaller number of shares of Common Stock,

then:

                           (1)      the   number  of  shares  of  Common   Stock
                                    acquirable  upon  exercise  of this  Warrant
                                    immediately after the occurrence of any such
                                    event  shall be adjusted to equal the number
                                    of  shares of  Common  Stock  which a record
                                    holder  of the  same  number  of  shares  of
                                    Common Stock that would have been acquirable
                                    under this Warrant  immediately prior to the
                                    occurrence  of such  event  would  own or be
                                    entitled to receive  after the  happening of
                                    such event, and

                           (2)      the  Per  Share   Exercise  Price  shall  be
                                    adjusted to equal:

                                    (A)     the  Per  Share  Exercise  Price  in
                                            effect   immediately  prior  to  the
                                            occurrence of such event  multiplied
                                            by the  number  of  shares of Common
                                            Stock  into  which  this  Warrant is
                                            exercisable immediately prior to the
                                            adjustment, divided by

                                    (B)     the number of shares of Common Stock
                                            into   which    this    Warrant   is
                                            exercisable  immediately  after such
                                            adjustment.

Any  adjustment  made  pursuant  to clause (i) of this  paragraph  shall  become
effective   immediately   after  the  record  date  for  the   determination  of
shareholders  entitled  to  receive  such  dividend  or  distribution,  and  any
adjustment  pursuant to clauses  (ii) or (iii) of this  paragraph  shall  become
effective   immediately   after  the  effective  date  of  such  subdivision  or
combination.

                  5.2 Fractional Interests.  In computing adjustments under this
Section 5, all calculations shall be made to the nearest 1/100th of a share.

                  5.3 Reorganization, Reclassification, Merger, Consolidation or
Disposition of Assets.

                           (a) If, prior to the Termination  Date,  there  shall
occur a Change of Control and,  pursuant to the terms of such Change of Control,
shares of common stock of the successor or acquiring  corporation,  or any cash,
shares  of  stock or other  securities  or  property  of any  nature  whatsoever
(including  warrants or other subscription or purchase rights) in addition to or
in lieu of  common  stock of the  successor  or  acquiring  corporation  ("Other
Property"),  are to be received by or distributed to the holders of Common Stock
of the Company,  then the Holder of this Warrant shall have the right thereafter
to receive,  upon the  exercise of the  Warrant,  the number of shares of common
stock of the successor or acquiring  corporation or of the Company, if it is the
surviving corporation,  and the Other Property receivable upon or as a result of
such Change of Control by a holder of the number of shares of Common  Stock into
which this Warrant is exercisable immediately prior to such event.

                                        4

<PAGE>

                           (b) In  case  of  any  such  Change  of  Control, the
successor or acquiring  corporation  (if other than the Company) shall expressly
assume  the due and  punctual  observance  and  performance  of each  and  every
covenant and condition contained in this Warrant to be performed and observed by
the Company and all of the  Company's  obligations  and  liabilities  hereunder,
subject to such  modifications  as may be deemed  appropriate  (as determined in
good faith by  resolution  of the Board of Directors of the Company) in order to
provide for adjustments of shares of the Common Stock into which this Warrant is
exercisable   which  shall  be  as  nearly  equivalent  as  practicable  to  the
adjustments provided for in this Section 5.

                  5.4 Other Action  Affecting  Common Stock. In case at any time
or from time to time the Company  shall take any action in respect of its Common
Stock,  then, unless such action will not have a materially  adverse effect upon
the rights of the holder of this  Warrant,  the number of shares of Common Stock
or other stock into which this Warrant is exercisable  and/or the purchase price
thereof   shall  be  adjusted  in  such  manner  as  may  be  equitable  in  the
circumstances.

                  5.5 Certain  Limitations.  Notwithstanding  anything herein to
the contrary,  the Company agrees not to enter into any  transaction  which,  by
reason of any adjustment hereunder,  would cause the Per Share Exercise Price to
be less than the par value per share of Common Stock.

                  6. NOTICES TO WARRANT HOLDERS.

                  6.1.  Certificate  as to  Adjustments.  Upon the occurrence of
each  adjustment or  readjustment of the Per Share Exercise Price, or the number
of shares of Common Stock and the amount, if any, of other property which at the
time would be received upon exercise of the Warrants  owned by such Holder,  the
Company, at its expense,  shall promptly compute such adjustment or readjustment
in  accordance  with the terms  hereof and  prepare and furnish to the Holder of
this Warrant a certificate  setting forth such  adjustment or  readjustment  and
showing in detail the facts upon which such adjustment or readjustment is based.
The Company  shall,  upon the written  request at any time of the Holder of this
Warrant,  furnish or cause to be  furnished  to such  Holder a like  certificate
setting  forth  (i) such  adjustments  and  readjustments,  (ii)  the Per  Share
Exercise  Price at the time in effect  and (iii) the  number of shares of Common
Stock and the  amount,  if any,  of other  property  which at the time  would be
received upon the exercise of Warrants owned by such Holder.

                  6.2. Notice of Corporate Action. If at any time:

                           (a) the Company shall take a record of the holders of
its Common  Stock for the  purpose of  entitling  them to receive a dividend  or
other  distribution,  or any right to subscribe for or purchase any evidences of
its  indebtedness,  any shares of stock of any class or any other  securities or
property, or to receive any other right, or

                           (b) there shall be any capital  reorganization of the
Company,  any  reclassification  or recapitalization of the capital stock of the
Company  or any  consolidation  or  merger  of the  Company  with,  or any sale,
transfer or other disposition of all or substantially  all the property,  assets
or business of the Company to, another corporation or other person, or

                                        5

<PAGE>

                           (c) there   shall  be  a  voluntary  or   involuntary
dissolution, liquidation or winding up of the Company;

then, in any one or more of such cases, the Company shall give to the Holder (i)
at least 15 days'  prior  written  notice of the record date  selected  for such
dividend,  distribution or right or for determining rights to vote in respect of
any  such  reorganization,   reclassification,   merger,  consolidation,   sale,
transfer, disposition,  dissolution,  liquidation or winding up, and (ii) in the
case of any such reorganization,  reclassification, merger, consolidation, sale,
transfer, disposition, dissolution, liquidation or winding up, at least 15 days'
prior written notice of the date when the same shall take place.  Such notice in
accordance  with the  foregoing  clause also shall specify (i) the date on which
any such record is to be taken for the purpose of such dividend, distribution or
right,  the date on which the  holders of Common  Stock shall be entitled to any
such dividend,  distribution or right, and the amount and character thereof, and
(ii) the  date on  which  any  such  reorganization,  reclassification,  merger,
consolidation, sale, transfer, disposition,  dissolution, liquidation or winding
up is to take place and the time,  if any such time is to be fixed,  as of which
the holders of Common Stock shall be entitled to exchange their shares of Common
Stock for securities or other  property  deliverable  upon such  reorganization,
reclassification,    merger,   consolidation,   sale,   transfer,   disposition,
dissolution,  liquidation  or winding  up.  Each such  written  notice  shall be
sufficiently  given if addressed to the Holder at the last address of the Holder
appearing on the books of the Company and delivered in  accordance  with Section
11. The  failure  to give any  notice  required  by this  Section  6.2 shall not
invalidate any such corporate action.

                  6.3. Notice to  Stockholders.  The Holder shall be entitled to
the same rights to receive notice of corporation  action as any holder of Common
Stock.

                  7.  NO  IMPAIRMENT.  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 the  Holder  against  impairment.  Without  limiting  the
generality of the foregoing,  the Company will (a) not increase the par value of
any shares of Common Stock  receivable  upon the exercise of this Warrant  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  shares of Common Stock upon the exercise of this Warrant, and
(c) use its best  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.
Upon the request of the Holder,  the Company  will at any time during the period
this Warrant is outstanding  acknowledge in writing, in form satisfactory to the
Holder,  the  continuing  validity of this  Warrant and the  obligations  of the
Company hereunder.

                                        6

<PAGE>

                  8. LIMITED TRANSFERABILITY.

                  (a) The Holder  represents  that by accepting  this Warrant 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.

                  (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  Securities  Act of 1933,  as amended  (the "Act").  The Holder
agrees that this  Warrant and any such  securities  may 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.

                  (c) This  Warrant  may not be sold,  transferred,  assigned or
hypothecated  for six (6) months from the date hereof  except (i) to any firm or
corporation that succeeds to all or  substantially  all of the business of Maxim
Group,  LLC,  (ii) to any of the officers,  employees,  associates or affiliated
companies of Maxim Group,  LLC, or of any such successor firm, (iii) to any NASD
member  participating  in the  offering of the  Company's  Series A  Convertible
Preferred  Stock or any  officer or  employee of any such NASD member or (iv) in
the case of an individual, pursuant to such individual's last will and testament
or the laws of descent and  distribution,  and is so transferable  only upon the
books of the Company  which the Company  shall cause to be  maintained  for such
purpose.  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 of the holder thereof shall be identical to
those of the Holder.

                  9.  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.

                  10.  STATUS OF HOLDER.  This  Warrant does not confer upon the
Holder any right to vote or to consent to or receive  notice as a stockholder of
the Company, as such, in respect of any matters whatsoever,  or any other rights
or liabilities as a stockholder, prior to the exercise hereof.

                  11.  NOTICES.  No notice  or other  communication  under  this
Warrant shall be effective unless, but any notice or other  communication  shall
be  effective  and shall be deemed to have been given if, the same is in writing
and is mailed by first-class mail, postage prepaid, addressed to:

                                        7

<PAGE>

                  If to the Holder:  Maxim Group, LLC, 405 Lexington Avenue,
                                     New York, New York 10174; or

                  If to the Company: c/o Manhattan Pharmaceuticals, Inc.
                                     787 Seventh Avenue, 48th Floor,
                                     New York, New York 10019, Attn: Secretary

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

                  13.  APPLICABLE  LAW.  This  Warrant  shall be governed by and
construed in accordance  with the laws of the State of New York,  without regard
to  principles  of conflicts  of law.  The parties  agree to settle any disputes
through binding arbitration in the city, county and State of New York.

                  14.  SUCCESSORS  AND ASSIGNS.  Subject to compliance  with the
provisions  of Section 8, this  Warrant and the rights  evidenced  hereby  shall
inure to the benefit of and be binding  upon the  successors  of the Company and
the  successors  and assigns of the 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,  but nothing in this Warrant shall
be construed to give any person or corporation  or other entity,  other than the
Company and the Holder and their respective successors and assigns, any legal or
equitable right, remedy or cause under this Warrant.

                   REMAINDER OF PAGE LEFT INTENTIONALLY BLANK.

                             SIGNATURE PAGE FOLLOWS.

                                        8

<PAGE>

                  IN WITNESS WHEREOF,  the Company has caused this Warrant to be
signed by its  President  and its  corporate  seal to be  hereunto  affixed  and
attested by its Secretary this 5th day of November, 2003.

                                   MANHATTAN PHARMACEUTICALS, INC.

                                   By:  _________________________________
                                        Name: Leonard Firestone, MD
                                        Title:   President & CEO

ATTEST:

___________________________________
         Secretary

                                        9

<PAGE>

                                  SUBSCRIPTION

                  The   undersigned,   ___________________,   pursuant   to  the
provisions  of the  foregoing  Warrant,  hereby  elects to  exercise  the within
Warrant to the extent of purchasing  ____________________ shares of Common Stock
thereunder  and hereby makes  payment of  $___________  by certified or official
bank check in payment of the exercise price therefor.

                  The undersigned  hereby represents and warrants to the Company
that the  undersigned  is  acquiring  the shares of the  Company's  Common Stock
pursuant to exercise of the within  Warrant for  investment  purposes  only. The
undersigned  hereby further  acknowledges that the undersigned  understands that
such shares (a) have not been  registered  under the  Securities Act of 1933, as
amended, and are being issued to the undersigned by the Company in reliance upon
the  foregoing  representation  and warranty and (b) may not be resold except in
accordance with the requirements of the Act,  including Rule 144 thereunder,  if
applicable.  The undersigned  further consents to the placing of a legend on the
certificates for the shares being purchased to the foregoing effect.

Dated:_______________                       Signature:____________________

                                            Address:______________________

                                   ASSIGNMENT

                  FOR VALUE RECEIVED  _______________  hereby sells, assigns and
transfers  unto  ____________________  the  foregoing  Warrant  and  all  rights
evidenced    thereby,    and   does    irrevocably    constitute   and   appoint
_____________________,  attorney,  to  transfer  said  Warrant  on the  books of
Manhattan Pharmaceuticals, Inc.

Dated:_______________                       Signature:____________________

                                            Address:______________________

                                       10
<PAGE>

                                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  $.001 per  share,  of
Manhattan Pharmaceuticals,  Inc. pursuant to the Cashless Exercise provisions of
the Warrant.

Dated:_______________                       Signature:____________________

                                            Address:______________________

                               PARTIAL ASSIGNMENT

                  FOR  VALUE   RECEIVED   _______________   hereby  assigns  and
transfers unto  ____________________ the right to purchase _______ shares of the
Common Stock, no par value per share, of Pain  Management,  Inc.  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  that part of said  Warrant on the
books of Manhattan Pharmaceuticals, Inc.

Dated:_______________                       Signature:____________________

                                            Address:______________________

                                       11
<PAGE>

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00060-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00060-of-00352.parquet"}]]