Document:

FORM OF LONG TERM INCENTIVE PLAN UNIT VESTING AGREEMENT

 Exhibit 10.69 
  
 LONG TERM INCENTIVE PLAN (LTIP) 
 UNIT VESTING AGREEMENT 
  
 UNDER
THE BOSTON PROPERTIES, INC. 
 1997 STOCK OPTION AND INCENTIVE PLAN 
  
 Name of Grantee:
                                     
 No. of LTIP Units:
                                     
 Purchase Price per Unit: $.25 per unit 
 Grant Date:
                                     ,
200     
 Final Acceptance Date:
                                     ,
200     
  
 Pursuant to the Boston
Properties, Inc. 1997 Stock Option and Incentive Plan (the “Plan”) as amended through the date hereof and the Second Amended and Restated Agreement of Limited Partnership of Boston Properties Limited Partnership, dated as of June 29, 1998,
as amended through the date hereof (the “Partnership Agreement”), of Boston Properties Limited Partnership, a Delaware limited partnership (the “Partnership”), Boston Properties, Inc., a Delaware corporation and the
general partner of the Partnership (the “Company”) hereby grants to the Grantee named above an Other Stock-Based Award (an “Award”) in the form of, and by causing the Partnership to issue to the Grantee named above,
a Partnership Interest (as defined in the Second Amended and Restated Agreement of Limited Partnership (the “Partnership Agreement”) of the Partnership, as amended) having the rights, voting powers, restrictions, limitations as to
distributions, qualifications and terms and conditions of redemption and conversion set forth herein and in the Forty-Seventh Amendment to the Partnership Agreement, such Partnership Interest to be expressed as a number of Partnership Units (as
defined in the Partnership Agreement) which shall be referred to as Long Term Incentive Units (“LTIP Units”). Upon acceptance of this Long Term Incentive Plan (LTIP) Unit Vesting Agreement (this “Agreement”), the
Grantee shall receive the number of LTIP Units specified above, subject to the restrictions and conditions set forth herein, in the Plan and in the Partnership Agreement. 
  
 1.    Acceptance of Agreement. The Grantee shall have no rights with respect to this Agreement
unless he or she shall have accepted this Agreement prior to the close of business on the Final Acceptance Date specified above by (i) making a contribution to the capital of the Partnership by certified or bank check or other instrument acceptable
to the Administrator (as defined in Section 2 of the Plan), of the Purchase Price per Unit specified above, times the number of LTIP Units to be issued to the Grantee as part of this Award, (ii) signing and delivering to the Partnership a copy of
this Agreement and (iii) unless the Grantee is already a Limited Partner (as defined in the Partnership Agreement), signing, as a Limited Partner, and delivering to the Partnership a counterpart signature page to the Partnership Agreement (attached
hereto as Annex A). The Purchase Price per Unit paid by the Grantee shall be deemed a contribution to the capital of the Partnership upon the terms and conditions set forth herein and in the Partnership Agreement. Upon acceptance of this
Agreement by the Grantee, the Partnership Agreement shall be amended to reflect the issuance to the Grantee of the LTIP Units so accepted 

 and the Partnership shall deliver to the Grantee a certificate of the Company certifying the number of LTIP Units then
issued to the Grantee. Thereupon, the Grantee shall have all the rights of a Limited Partner of the Partnership with respect to the number of LTIP Units specified above, as set forth in the Partnership Agreement, subject, however, to the
restrictions and conditions specified in Section 2 below. 
  
 2.    Restrictions and Conditions. 
  
 (a)    The records of the Partnership evidencing the LTIP Units granted herein shall bear an appropriate legend, as determined by the Partnership in its sole discretion, to the effect that such LTIP Units are subject to
restrictions as set forth herein, in the Plan and in the Partnership Agreement. 
  
 (b)    LTIP Units granted herein may not be sold, assigned, transferred, pledged or otherwise encumbered or disposed of by the Grantee prior to vesting. 
  
 (c)    If the Grantee’s employment with the Company
and its Subsidiaries (as defined in the Plan) is voluntarily or involuntarily terminated for any reason, subject to Section 13 of the Plan, prior to vesting of the LTIP Units granted herein, the Partnership shall have the right, at the discretion of
the Administrator, to repurchase such LTIP Units from the Grantee or the Grantee’s legal representative at the Purchase Price per Unit. The Partnership must exercise such right of repurchase or forfeiture by written notice to the Grantee or the
Grantee’s legal representative not later than 90 days following such termination of employment. 
  
 3.    Vesting of LTIP Units. The restrictions and conditions in Section 2 of this Agreement shall lapse on the Vesting Date or
Dates specified in the following schedule, so long as the Grantee remains an employee of the Company or one of its Subsidiaries on such Vesting Date or Dates. If a series of Vesting Dates is specified, then the restrictions and conditions in Section
2 shall lapse only with respect to the percentage of LTIP Units accepted by the Grantee hereunder that is specified as vested on such date. 
  

			
	 Percentage of
 LTIP Units Vested

	 	 Vesting Date

		
	25%	 	_____________ __, 200_
		
	35%	 	_____________ __, 200_
		
	40%	 	_____________ __, 200_

  
 Subsequent to such
Vesting Date or Dates, the LTIP Units on which all restrictions and conditions have lapsed shall no longer be deemed restricted. 
  
 4.    Acceleration of Vesting in Special Circumstances. If (i) the Grantee ceases to be an employee of the Company and its
Subsidiaries by reason of death, or incapacity due to physical or mental illness or disability which qualifies the Grantee to receive benefits under the Company’s long-term disability plan or (ii) a Change of Control (as defined in Section 16
of the 
  

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 Plan) occurs, any restrictions and conditions on all LTIP Units subject to this Award shall be deemed waived by the
Administrator and all LTIP Units granted hereby shall automatically become fully vested. 
  
 Anything to the contrary in the Plan notwithstanding, in the event a Transaction (as defined in Section 3(c) of the Plan) occurs, the Board (as defined in the Plan), or the board of directors of any corporation
assuming the obligations of the Company (“Acquiror”) shall have the right to take the action specified in Section 3(c) of the Plan (“Merger-Related Action”) subject to the following limitations and qualifications:

  
 (a)    if (i) all LTIP Units awarded to
the Grantee hereunder are eligible, as of the time of the Merger-Related Action (and giving effect to the anticipated consummation of the Transaction as provided in Section 8.8 of the Partnership Agreement), for conversion into Common Units (as
defined in the Partnership Agreement) and (ii) the Grantee is afforded the opportunity to effect such conversion and receive, in consideration for the Common Units into which his or her LTIP Units shall have been converted, the same kind and amount
of consideration as other holders of Common Units in connection with the Transaction, then Merger-Related Action of the kind specified in either clause (i) or clause (ii) of Section 3(c) of the Plan shall be permitted and available to the Company
and the Acquiror; 
  
 (b)    if (i) some or
all of the LTIP Units awarded to the Grantee hereunder are not, as of the time of the Merger-Related Action, so eligible for conversion into Common Units, and (ii) the acquiring or succeeding entity is itself, or has a subsidiary which is organized
as a partnership or limited liability company (consisting of a so called “UPREIT” or other structure similar in purpose or effect to that of the Company and the Partnership), then Merger-Related Action of the kind specified in clause (i)
of Section 3(c) of the Plan must be taken by the Acquiror with respect to all LTIP Units which are not so convertible at the time, whereby (A) all such LTIP Units covered by this Award shall be assumed by the acquiring or succeeding entity, or
equivalent awards shall be substituted by the acquiring or succeeding entity, and (B) the acquiring or succeeding entity shall preserve with respect to the assumed LTIP Units or any securities to be substituted for such LTIP Units, as far as
reasonably possible under the circumstances, the distribution, special allocation, conversion and other rights set forth in the Partnership Agreement for the benefit of the holders of LTIP Units; and 
  
 (c)    if (i) some or all of the LTIP Units awarded to
the Grantee hereunder are not, as of the time of the Merger-Related Action, so eligible for conversion into Common Units, and (ii) the conditions set forth in Section 4(b) above cannot be satisfied after exercise of reasonable commercial efforts by
the Company and/or Acquiror, then Merger-Related Action of the kind specified in clause (ii) of Section 3(c) of the Plan must be taken by the Company or the Acquiror, in which case such action shall be based on the principle that the settlement of
the terminated award of LTIP Units which are not convertible into Common Units requires a payment of the same kind and amount of consideration payable in connection with the Transaction to a holder of the number of Common Units into which the LTIP
Units to be terminated could be converted (including the right to make elections as to the type of consideration) if the Transaction were of a nature that permitted a revaluation of the Grantee’s capital account balance under the terms of the
Partnership Agreement, as determined by the Administrator in good faith in accordance with the Plan. 
  

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 5.    Distributions. Distributions on the LTIP Units shall be paid currently
to the Grantee in accordance with the terms of the Partnership Agreement. The right to distributions set forth in this Section 5 shall be deemed a Dividend Equivalent Right for purposes of the Plan. 
  
 6.    Incorporation of Plan. Notwithstanding
anything herein to the contrary, this Agreement shall be subject to and governed by all the terms and conditions of the Plan. Capitalized terms used in this Agreement shall have the meaning specified in the Plan, unless a different meaning is
specified herein. 
  
 7.    Covenants.
The Grantee hereby covenants as follows: 
  
 (a)    So long as the Grantee holds any LTIP Units, the Grantee shall disclose to the Partnership in writing such information as may be reasonably requested with respect to ownership of LTIP Units as the Partnership may
deem reasonably necessary to ascertain and to establish compliance with provisions of the Internal Revenue Code of 1986, as amended (the “Code”), applicable to the Partnership or to comply with requirements of any other appropriate taxing
authority. 
  
 (b)    The Grantee hereby
agrees to make an election under Section 83(b) of the Code with respect to the LTIP Units awarded hereunder, and has delivered with this Agreement a completed, executed copy of the election form attached hereto as Annex B. The Grantee agrees
to file the election (or to permit the Partnership to file such election on the Grantee’s behalf) within thirty (30) days after the award of the LTIP Units hereunder with the IRS Service Center at which such Grantee files his or her personal
income tax returns, and to file a copy of such election with the Grantee’s U.S. federal income tax return for the taxable year in which the LTIP Units are awarded to the Grantee. 
  
 8.    Transferability. This Agreement is personal to the Grantee, is non-assignable and is not
transferable in any manner, by operation of law or otherwise, other than by will or the laws of descent and distribution. 
  
 9.    Amendment. The Grantee acknowledges that the Plan may be amended or discontinued in accordance with Section 14 thereof
and that this Agreement may be amended or canceled by the Administrator, on behalf of the Partnership, for the purpose of satisfying changes in law or for any other lawful purpose, provided that no such action shall adversely affect the
Grantee’s rights under this Agreement without the Grantee’s written consent. The provisions of Section 4 of this Agreement applicable to the termination of the LTIP Units covered by this Award in connection with a Transaction (as defined
in the Plan) pursuant to Section 3(b) of the Plan shall apply, mutatis mutandi to amendments, discontinuance or cancellation pursuant to this Section 9 or Section 14 of the Plan. 
  
 10.    No Obligation to Continue Employment. Neither the Company nor any Subsidiary is obligated
by or as a result of the Plan or this Agreement to continue the Grantee in employment and neither the Plan nor this Agreement shall interfere in any way with the right of the Company or any Subsidiary to terminate the employment of the Grantee at
any time. 
  
 11.    Notices. Notices
hereunder shall be mailed or delivered to the Partnership at its principal place of business and shall be mailed or delivered to the Grantee at the address on file 
  

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 with the Partnership or, in either case, at such other address as one party may subsequently furnish to the other party
in writing. 
  
 12.    Governing Law.
This Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware, applied without regard to conflict of law principles. The parties hereto agree that any action or proceeding arising directly, indirectly or
otherwise in connection with, out of, related to or from this Agreement, any breach hereof or any action covered hereby, shall be resolved within the Commonwealth of Massachusetts and the parties hereto consent and submit to the jurisdiction of the
federal and state courts located within the City of Boston, Massachusetts. The parties hereto further agree that any such action or proceeding brought by either party to enforce any right, assert any claim, obtain any relief whatsoever in connection
with this Agreement shall be brought by such party exclusively in federal or state courts located within the Commonwealth of Massachusetts. 
  
 [Remainder of page left blank intentionally] 
  

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	BOSTON PROPERTIES, INC.
		
	By:	 	 
	 	 	

	 	 	 Name:
 Title:

  
  

			
	BOSTON PROPERTIES LIMITED PARTNERSHIP
		
	By:	 	Boston Properties, Inc., its general partner
		
	 	 	 By:                                      
              
       Name:
       Title:

  

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 The foregoing Agreement is hereby accepted and the terms and conditions thereof hereby agreed to by the Grantee.

  

									
	Dated:
                                        
                                	 	 	 	  

	 	 	 	 	 	 	Grantee’s Signature
				
	 	 	 	 	 	 	 Grantee’s name and address:
  
  

				
	 	 	 	 	 	 	  

				
	 	 	 	 	 	 	  

				
	 	 	 	 	 	 	  

				
	 	 	 	 	 	 	 

 ANNEX A 
  
 FORM OF LIMITED PARTNER SIGNATURE PAGE 
 FOR PARTNERS ADMITTED AFTER JUNE 29, 1998 
  
 The Grantee, desiring to become one of the within named Limited Partners of Boston Properties Limited Partnership, hereby becomes a party to the Second Amended and Restated Agreement of Limited Partnership of Boston
Properties Limited Partnership by and among Boston Properties, Inc. and such Limited Partners, dated as of June 29, 1998, as amended. The Grantee agrees that this signature page may be attached to any counterpart of said Agreement of Limited
Partnership. 
  

									
	 Signature Line for Limited Partner:
	 	 	 	 
	 	 	 	 	 	 	  

 Name:
 Date:

				
	 	 	Address of Limited Partner:	 	 	 	
  
  

 ANNEX B 
  
 ELECTION TO INCLUDE IN GROSS INCOME IN YEAR OF 
 TRANSFER OF PROPERTY PURSUANT TO SECTION 83(b) 
 OF THE INTERNAL REVENUE CODE

  
 The undersigned hereby makes an election pursuant to
Section 83(b) of the Internal Revenue Code with respect to the property described below and supplies the following information in accordance with the regulations promulgated thereunder: 
  

	 	1.	The name, address and taxpayer identification number of the undersigned are: 

  

	 	    	Name:
                                        
     (the “Taxpayer”) 

  

	 	    	Address:
                                        
                                        
                 

  

	 	

  

	 	    	Social Security No.
                                        
                                        

  

	 	2.	Description of property with respect to which the election is being made: 

  

	 	    	The election is being made with respect to              LTIP Units in Boston Properties Limited Partnership (the
“Partnership”). 

  

	 	3.	The date on which the LTIP Units were transferred is                     
            , 200_. The taxable year to which this election relates is calendar year 200_. 

  

	 	4.	Nature of restrictions to which the LTIP Units are subject: 

  

	 	(a)	Until the LTIP Units vest, the Taxpayer may not transfer in any manner any portion of the LTIP Units without the consent of the Partnership. 

  

	 	(b)	The Taxpayer’s LTIP Units vest in accordance with the vesting provisions described in the Schedule attached hereto. Unvested LTIP Units are forfeited in accordance with the
vesting provisions described in the Schedule attached hereto. 

  

	 	5.	The fair market value at time of transfer (determined without regard to any restrictions other than restrictions which by their terms will never lapse) of the LTIP Units with
respect to which this election is being made was $0.25 per LTIP Unit. 

  

	 	6.	The amount paid by the Taxpayer for the LTIP Units was $0.25 per LTIP Unit. 

	 	7.	A copy of this statement has been furnished to the Partnership, to its general partner, Boston Properties, Inc., and to its subsidiary BP Management, L.P. 

 

									
	Dated:
                            , 200_	 	 	 	 
				
	 	 	 	 	 	 	  

	 	 	 	 	 	 	Name:

  
  
 Spousal Consent 
  
 The undersigned hereby consents to the making, by the undersigned’s spouse, of the foregoing election pursuant to Section 83(b) of the Internal Revenue Code. 
  

			
	 
	
	  

	(Signature)

  
 (Type or Print Spouse’s
Name) 

 Schedule to Section 83(b) Election -Vesting Provisions of LTIP Units 
  
 LTIP Units are subject to time-based vesting with 25% vesting on
                                 , 200_, 35% vesting on
                                 , 200_ and 40% vesting on
                                 , 200_, subject to acceleration in the
event of certain extraordinary transactions or termination of the Taxpayer’s employment in certain circumstances. Unvested LTIP Units are subject to repurchase at cost in the event of the termination of the Taxpayer’s employment with
Boston Properties, Inc. and its subsidiaries.EXHIBIT 4.1

 Exhibit 4.1 
  
 SECURITIES PURCHASE AGREEMENT 
  

SECURITIES PURCHASE AND EXCHANGE AGREEMENT (the “Agreement”), dated as of February 20, 2004, by and among Andrea Electronics
Corporation, a New York corporation, with headquarters located at 45 Melville Park Road, Melville, New York 11747 (the “Company”), and the investors listed on the Schedule of Buyers attached hereto as Exhibit I (the “Buyers” and
each a “Buyer”). 
  
 WHEREAS: 
  
 A. The Company and the Buyers are executing and delivering this Agreement in
reliance upon the exemption from securities registration afforded by Rule 506 of Regulation D (“Regulation D”) as promulgated by the United States Securities and Exchange Commission (the “SEC”) under the Securities Act of 1933,
as amended (the “1933 Act”); 
  
 B. The Company has
authorized the following new series of its Preferred Stock, par value $0.01 per share, which shall be called the Series D Convertible Preferred Stock (the “Series D Preferred Stock”), and which shall be convertible into shares of the
Company’s common stock, par value $0.01 per share (the “Common Stock”) (as converted, the “Conversion Shares”), in accordance with the terms of the Certificate of Amendment of the Certificate of Incorporation of the Company
for the Series D Preferred Stock, substantially in the form attached hereto as Exhibit II (the “Certificate of Amendment”); 
  
 C. Each Buyer severally wishes to purchase, upon the terms and subject to the conditions stated in this Agreement, units of securities of the Company (the
“Units”) consisting of shares of the Series D Preferred Stock (the “Preferred D Shares”) and warrants in substantially the same form attached hereto as Exhibit III to acquire shares of Common Stock (the “Warrants”),
each Unit to consist of one Preferred D Share and Warrants to purchase two (2) shares of Common Stock upon exercise of the Warrants (the “Warrant Shares”); 
  
 D. Contemporaneously with the execution and delivery of this Agreement, the parties hereto are executing and delivering a
Registration Rights Agreement substantially in the form attached hereto as Exhibit IV (the “Registration Rights Agreement”) pursuant to which the Company has agreed to provide certain registration rights under the 1933 Act and the rules
and regulations promulgated thereunder, and applicable state securities laws. 
  
 NOW THEREFORE, in consideration of the premises, mutual promises and covenants contained in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Company and the Buyers hereby agree as follows: 
  
 1. PURCHASE AND SALE OF PREFERRED D SHARES AND WARRANTS. 
  
 a. Initial Purchase. Subject to satisfaction (or waiver) of the conditions set forth in Sections 6(a) and 7(a), at the Initial Closing (as hereinafter defined) the Company shall 

 issue and sell to the Buyers and the Buyers shall purchase from the Company, for a price of $1.00 per Unit, an aggregate
of 1,250,000 Units (the “Initial Units”), which include an aggregate of 1,250,000 Preferred D Shares (the “Initial Preferred Shares”) and Warrants (the “Initial Warrants”) to purchase an aggregate of 2,500,000 shares of
Common Stock at an exercise price equal to the Fair Market Value (as hereinafter defined) of a share of Common Stock as of the Initial Closing Date (as hereinafter defined). The Company shall issue and sell to each Buyer and each Buyer severally
agrees to purchase from the Company, at the Initial Closing, the number of Initial Units set forth in Exhibit I hereto. 
  
 b. Additional Purchase. Subject to satisfaction of the “Stockholder Approval Condition,” as set forth in Section 1(d) hereof, and to
satisfaction (or waiver) of the conditions set forth in Section 6(b)(i) and 7(b)(i), at the Additional Closing (as hereinafter defined) the Company shall issue and sell to the Buyers and the Buyers shall purchase from the Company, for a price of
$1.00 per Unit, an aggregate of 1,250,000 Units (the “Additional Units”), which include an aggregate 1,250,000 Preferred D Shares (the “Additional Preferred Shares”) and Warrants (the “Additional Warrants”) to purchase
an aggregate of 2,500,000 shares of Common Stock at an exercise price per share of Common Stock equal to the Fair Market Value (as hereinafter defined) of a share of Common Stock as of the Additional Closing Date (as hereinafter defined). Each Buyer
severally agrees to purchase from the Company, at the Additional Closing, the Additional Units set forth in Exhibit I hereto. For purpose of Section 1, Fair Market Value shall mean, as of the Initial Closing Date or the Additional Closing Date, as
applicable, the closing sales price of the Common Stock, as reported on the American Stock Exchange (or such other market which is the principal trading market for the Common Stock) (the “AMEX”), on the Business Day (as herein defined)
immediately prior to such Closing Date. For purposes of this Agreement, “Business Day” shall mean any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized or required by law to
remain closed. 
  
 c. The Initial Closing Date. The date
and time of the Initial Closing (the “Initial Closing Date”) shall be 10:00 a.m. Eastern Time, not later than seven (7) days following the date hereof, subject to satisfaction (or waiver) of the conditions to the Initial Closing set forth
in Sections 6(a) and 7(a) (or such later date as is mutually agreed to by the Company and the Buyers). The Initial Closing shall occur on the Initial Closing Date at the offices of Muldoon Murphy & Faucette LLP, 5101 Wisconsin Avenue, N.W.,
Washington, DC 20016. 
  
 d. The Additional Closing Date.
The date and time of the Additional Closing (the “Additional Closing Date”) shall be 10:00 a.m. Eastern Time, on the fifth Business Day after the effectiveness, after satisfaction of the Stockholder Approval Condition, of the Registration
Statement required by Section 2(a) the Registration Rights Agreement, subject to satisfaction (or waiver) of the applicable conditions to the Additional Closing set forth in Sections 6(b) and 7(b) (or such later date as is mutually agreed to by the
Company and the Buyers). The Additional Closing shall occur on the Additional Closing Date at the offices of Muldoon Murphy & Faucette LLP, 5101 Wisconsin Avenue, N.W., Washington, DC 20016. The Initial Closing Date and the Additional Closing
Date collectively are referred to in this Agreement as the “Closing Dates.” The Stockholder Approval Condition shall mean the receipt by the Company of the requisite approval of its stockholders for the sale and issuance of the Additional
Units, to the extent required by AMEX requirements; provided, however, that any stockholder approval shall be obtained no later than May 21, 2004. 
  

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 e. Form of Payment. On each of the Closing Dates (i) each Buyer shall pay the purchase price to
the Company for the Units, including the Preferred D Shares and the Warrants to be issued and sold to such Buyer, by wire transfer of immediately available funds in accordance with the Company’s written wire instructions, and (ii) the Company
shall deliver to each Buyer stock certificates (in the denominations as Buyer shall request) (the “Stock Certificates”) representing such number of the Preferred D Shares and Warrants which such Buyer is then purchasing, duly executed on
behalf of the Company and registered in the name of such Buyer. 
  
 2. BUYER REPRESENTATIONS AND WARRANTIES. 
  
 Each
Buyer severally represents and warrants that: 
  
 a.
Investment Purpose. Such Buyer (i) is acquiring the Preferred D Shares and Warrants and (ii) upon conversion of the Preferred D Shares and exercise of the Warrants, will acquire the shares of Common Stock then issuable (the Preferred D
Shares, Warrants and such shares of Common Stock collectively are referred to herein as the “Securities”), for its own account for investment only and not with a view towards, or for resale in connection with, the public sale or
distribution thereof, except pursuant to sales registered or exempted under the 1933 Act; provided, however, that by making the representations herein, Buyer does not agree to hold any of the Securities for any minimum or other specific term and
reserves the right to dispose of the Securities at any time in accordance with or pursuant to a registration statement or an exemption under the 1933 Act. Such Buyer has adequate net worth and means of providing for its current needs and
contingencies to sustain a complete loss of its investment in the Company. Such Buyer’s overall commitment to investments which are not readily marketable is not disproportionate to its net worth and such Buyer’s investment in the Series D
Preferred Stock will not cause such overall commitment to become excessive. 
  
 b. Accredited Investor Status. Such Buyer is an “accredited investor” as that term is defined in Rule 501(a) of Regulation D and is not an affiliate, director or officer of the Company. 
  
 c. Reliance on Exemptions. Such Buyer understands that the Securities
are being offered and sold to it in reliance on specific exemptions from the registration requirements of United States federal and state securities laws and that the Company is relying in part upon the truth and accuracy of, and such Buyer’s
compliance with, the representations, warranties, agreements, acknowledgments and understandings of such Buyer set forth herein in order to determine the availability of such exemptions and the eligibility of such Buyer to acquire such Securities.

  
 d. Information. Such Buyer and its advisors, if any,
have been furnished with all materials relating to the business, finances and operations of the Company and materials relating to the offer and sale of the Securities which have been requested by such Buyer. Such 
  

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 Buyer is aware of the SEC Documents, as defined in Section (f) of this Agreement, including the disclosures regarding
risks included in the SEC Documents. Such Buyer and its advisors, if any, have been afforded the opportunity to ask questions of the Company. Neither such inquiries nor any other due diligence investigations conducted by such Buyer or its advisors,
if any, or its representatives shall modify, amend or affect such Buyer’s right to rely on the Company’s representations and warranties contained in Sections 3 below. Such Buyer understands that its investment in the Securities involves a
high degree of risk. Buyer has sought such accounting, legal and tax advice as it has considered necessary to make an informed investment decision with respect to its acquisition of the Securities. 
  
 e. No Governmental Review. Such Buyer understands that no United
States federal or state agency or any other government or governmental agency has passed on or made any recommendation or endorsement of the Securities or the fairness or suitability of the investment in the Securities nor have such authorities
passed upon or endorsed the merits of the offering of the Securities. 
  
 f. Transfer or Resale. Such Buyer understands that except as provided in the Registration Rights Agreement: (i) the Securities have not been and are not being registered under the 1933 Act or any state securities laws, and may not be
offered for sale, sold, assigned or transferred unless (A) pursuant to an effective registration statement under the Securities Act of 1933, as amended (the “1933 Act”) or, (B) such Buyer shall have delivered to the Company an opinion of
counsel, in a form reasonably satisfactory to the Company, to the effect at such Securities to be sold, assigned or transferred may be sold, assigned or transferred pursuant to an on from such registration, or (C) such Buyer provides the Company
with reasonable assurance that such Securities can be sold, assigned or transferred pursuant to Rule 144 promulgated under the 1933 Act (or a successor rule thereto) (“Rule 144”); (ii) any sale of the Securities made in reliance on Rule
144 may be made only in accordance with the terms of Rule 144 and further, if Rule 144 is not applicable, any resale of the Securities under circumstances in which the seller (or the person through whom the sale is made) may be deemed to be an
underwriter (as that term is defined in the 1933 Act) may require compliance with some other exemption under the 1933 Act or the rules and regulations of the SEC thereunder; and (iii) neither the Company nor any other person is under any obligation
to register such Securities under the 1933 Act or any state securities laws or to comply with the terms and conditions of any exemption thereunder. 
  
 g. Legends. Such Buyer understands that the certificates or other instruments representing the Securities, except as set forth below, shall bear a
restrictive legend in substantially the following form (and a stop-transfer order may be placed against transfer of such stock certificates): 
  
 THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, (THE “1933 ACT”), OR ANY STATE
SECURITIES LAWS. THE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED EXCEPT (1) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT FOR THE 
  

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 SECURITIES UNDER THE 1933 ACT, OR (2) PURSUANT TO RULE 144 UNDER THE 1933 ACT OR (3) IN A TRANSACTION
THAT MAY BE EFFECTED WITHOUT REGISTRATION UNDER THE 1933 ACT IN RELIANCE UPON AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN
CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING TRANSACTION SECURED BY THE SECURITIES. 
  
 The legend set forth above shall be removed and the Company shall issue a certificate without such legend to the holder of the Securities upon which it is stamped, if (i) such Securities are registered for sale by the
holder under the 1933 Act pursuant to an effective registration statement, if such Buyer furnishes to the Company (x) a representation to the effect that such Buyer is aware of its obligations under the registration requirements of the 1933 Act with
respect to the Securities, and (y) an undertaking that such Securities, as the case may be, shall only be sold or transferred pursuant to a sale in conformance with such registration requirements, which representations and undertakings permit
reliance thereon by any counsel rendering an opinion regarding the removal of such legend and which are in a form reasonably satisfactory to the Company, (ii) in connection with a sale transaction, such holder provides the Company with an opinion of
counsel, in a form reasonably satisfactory to the Company, to the effect that a public sale, assignment or transfer of such Securities may be made without registration under the 1933 Act, or (iii) such holder provides the Company with assurances
reasonably acceptable to the Company that such Securities can be sold pursuant to Rule 144 without any restriction as to the number of securities acquired as of a particular date that can then be immediately sold. Such Buyer acknowledges, covenants
and agrees to sell the Securities represented by a certificate(s) from which the legend has been removed, only pursuant to (i) a registration statement effective under the 1933 Act, or (ii) advice of counsel that such sale is exempt from
registration required by Section 5 of the 1933 Act. 
  
 h.
Authorization, Enforcement. This Agreement and the Registration Rights Agreement have been duly and validly authorized, executed and delivered on behalf of such Buyer and are valid and binding agreements of such Buyer enforceable against such
Buyer in accordance with their terms, subject as to enforceability to general principles of equity and to applicable bankruptcy, insolvency, reorganization, moratorium, liquidation and other similar laws relating to, or affecting generally, the
enforcement of applicable creditors’ rights and remedies of Buyers. 
  
 i. Residency. Such Buyer is a resident of that jurisdiction specified on the Schedule of Buyers, Exhibit I hereto. 
  
 j. Limitations on Sales. During the periods from February 11, 2004, until the Initial Closing Date and from the date of effectiveness of the
Registration Statement required by Section 2(a) of the Registration Rights Agreement, provided that written notice of such anticipated effective date shall be faxed to the Buyers on or prior to such effective date (or from 
  

 5 

 such later date as such notice is faxed to the Buyers) until the Additional Closing Date, none of the Buyers or any of
their affiliates has or will engage, directly or indirectly, in any sales of the Common Stock, including short sales or in a transaction which has the substantive equivalence of a short sale. 
  
 k. Reserved 
  
 l. Confidentiality. Such Buyer has and will maintain the
confidentiality of any confidential information regarding the Company obtained by such Buyer in connection with the negotiation of this Agreement or otherwise from the Company or its directors, officers or affiliates, and, prior to the Initial
Closing, any information regarding the transactions contemplated by this Agreement. 
  
 m. Series C Preferred Stock. As of the Initial Closing Date, the Buyers in the aggregate will own of record and beneficially 582.887593 shares of Series C Convertible Preferred Stock of the Company (the
“Series C Preferred Stock”). 
  
 3. REPRESENTATIONS
AND WARRANTIES OF THE COMPANY. 
  
 The Company represents and
warrants to the Buyers that: 
  
 a. Organization and
Qualification. The Company and its “Subsidiaries” (which for purposes of this Agreement means any entity in which the Company, directly or indirectly, owns capital stock or holds an equity or similar interest) are corporations duly
organized and validly existing in good standing under the laws of the jurisdiction in which they are incorporated, and have the requisite corporate power and authorization to own properties and to carry on their business as now being conducted. Each
of the Company and its Subsidiaries is duly qualified as a foreign corporation to do business and is in good standing in every jurisdiction in which its ownership of property or the nature of the business conducted by it makes such qualification
necessary, except to the extent that the failure to be so qualified or be in good standing would not have a Material Adverse Effect. As used in this Agreement, “Material Adverse Effect” means any material adverse effect on the business,
properties, assets, operations, results of operations or financial condition of the Company and its Subsidiaries taken as a whole, or on the ability of the Company to perform its obligations under this Agreement, the Registration Rights Agreement
and the Warrants, or on the authority or ability of the Company to perform its obligations under the Transaction Documents (as defined below) or the Certificate of Amendment. 
  
 b. Authorization, Enforcement, Compliance with Other Instruments. (i) The Company has the requisite corporate power
and authority to enter into and perform its obligations under this Agreement, the Registration Rights Agreement, its obligations under the Warrants, the Irrevocable Transfer Agent Instructions (as defined in Section 5) and each of the other
agreements, if any, entered into by the parties hereto in connection with the transactions contemplated by this Agreement (collectively, the “Transaction Documents”), and to issue the Securities in accordance with the terms hereof and
thereof, (ii) the execution and delivery of the Transaction Documents by the Company and the execution and filing of the Certificate of 
  

 6 

 Amendment by the Company and the consummation by it of the transactions contemplated hereby and thereby, including
without limitation the issuance of the Preferred D Shares and Warrants and the reservation for issuance, and the issuance of the Conversion Shares issuable upon conversion of the Preferred D Shares and of the shares of Common Stock issuable upon
exercise of the Warrants have been duly authorized by the Company’s Board of Directors and no further consent or authorization is required by the Company, its Board of Directors or its stockholders (except such stockholder approval as may be
required by AMEX for the issuance of (or the obligation to issue) a number of shares of Common Stock which is greater than 19.99% of the number of shares outstanding prior to the Initial Closing Date), (iii) the Transaction Documents have been duly
executed and delivered by the Company, (iv) this Agreement and, when executed and delivered, the other Transaction Documents, constitute the valid and binding obligations of the Company enforceable against the Company in accordance with their terms,
except as such enforceability may be limited by general principles of equity or applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws relating to, or affecting generally, the enforcement of creditors’ rights
and remedies, and (v) prior to each of the Closing Dates, the Certificate of Amendment will have been filed with the Secretary of State of the State of New York and will be in full force and effect, enforceable against the Company in accordance with
its terms. 
  
 c. Capitalization. The authorized capital
stock of the Company consists of (i) 200,000,000 shares of Common Stock, of which as of the date hereof 38,103,062 shares were issued and outstanding, 6,063,125 shares were issuable and reserved for issuance pursuant to the Company’s stock
option and purchase plans and 46,809,687 shares were issuable and reserved for issuance pursuant to securities (other than the Series D Preferred Stock) and Warrants exercisable or exchangeable for, or convertible into, shares of Common Stock and
(ii) 5,000,000 shares of Preferred Stock, of which as of the date hereof, (A) 1,500 shares were designated as Series B Convertible Preferred Stock, of which no shares were issued and outstanding, (B) 1,000 shares were designated as Series C
Preferred Stock, of which 425.626564 shares were issued and outstanding and (C) 90,975.87 shares were designated as Series A Junior Participating Preferred Stock and were issuable and reserved for issuance pursuant to the Company’s Rights Plan
(as defined in Section 3(t)). All of such outstanding shares have been, or upon issuance will be, validly issued and are fully paid and nonassessable. Except as disclosed in Schedule 3(c), (i) no shares of the Company’s capital stock are
subject to preemptive rights or any other similar rights or any liens or encumbrances suffered or permitted by the Company; (ii) there are no outstanding debt securities issued by the Company; (iii) there are no outstanding options, warrants, scrip,
rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, any shares of capital stock of the Company or any of its Subsidiaries, or contracts, commitments, understandings or
arrangements by which the Company or any of its Subsidiaries is or may become bound to issue additional shares of capital stock of the Company or any of its Subsidiaries or options, warrants, scrip, rights to subscribe to, calls or commitments of
any character whatsoever relating to, or securities or rights convertible into, any shares of capital stock of the Company or any of its Subsidiaries; (iv) there are no agreements or arrangements under which the Company or any of its Subsidiaries is
obligated to register the sale of any of their securities under the 1933 Act (except the Registration Rights Agreement) and Series C Registration Rights Agreement; (v) there are no outstanding securities of the Company or any of its Subsidiaries
which contain any redemption or similar provisions, and there are no 
  

 7 

 contracts, commitments, understandings or arrangements by which the Company or any of its Subsidiaries is or may become
bound to redeem a security of the Company or any of its Subsidiaries, except the Series C Preferred Stock; (vi) there are no securities or instruments containing anti-dilution or similar provisions that will be triggered by the issuance of the
Securities as described in this Agreement, except the Series C Preferred Stock; and (vii) the Company does not have any stock appreciation rights or “phantom stock” plans or agreements or any similar plan or agreement. The Company has
furnished to the Buyers true and correct copies of the Company’s Certificate of Incorporation, as amended and as in effect on the date hereof, and the Company’s By-laws, as in effect on the date hereof, and the terms of all securities
convertible into or exercisable for Common Stock and the material rights of the holders thereof in respect thereto. 
  
 d. Issuance of Securities. The Preferred D Shares are duly authorized and, upon issuance in accordance with the terms hereof, shall be (i) validly
issued, fully paid and non-assessable, (ii) free from all taxes, liens and charges with respect to the issue thereof and (iii) entitled to the rights and preferences set forth in the Certificate of Amendment. At least 15,000,000 shares of Common
Stock have been duly authorized and reserved for issuance upon conversion of the Preferred D Shares and the exercise of the Warrants. Upon conversion in accordance with the Certificate of Amendment, the Conversion Shares will be validly issued,
fully paid and nonassessable and free from all taxes, liens and charges with respect to the issue thereof, with the holders being entitled to all rights accorded to a holder of Common Stock. The shares of Common Stock issued upon exercise of the
Warrants in accordance with their terms will be validly issued, fully paid and nonassessable and free from all taxes, liens and charges with respect to the issue thereof, with the holders being entitled to all rights accorded to a holder of Common
Stock. 
  
 e. No Conflicts. Except as disclosed in Schedule
3(e), the execution, delivery and performance of the Transaction Documents by the Company, the performance by the Company of its obligations under the Certificate of Amendment and the consummation by the Company of the transactions contemplated
hereby and thereby (including, without limitation, the reservation for issuance and issuance of the Conversion Shares) and the shares of Common Stock issuable upon exercise of the Warrants will not (i) result in a violation of the Certificate of
Incorporation, any Certificate of Amendment, Preferences and Rights of any outstanding series of Preferred Stock of the Company or the By-laws; (ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would
become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Company or any of its Subsidiaries is a party; or (iii) result in a violation of
any law, rule, regulation, order, judgment or decree (including federal and state securities laws and regulations and the rules and regulations of the principal market or exchange on which the Common Stock is traded or listed) applicable to the
Company or any of its Subsidiaries or by which any property or asset of the Company or any of its Subsidiaries is bound or affected. Except as disclosed in Schedule 3(e), neither the Company nor its Subsidiaries is in violation of any term of (i)
its Certificate of Incorporation, any Certificate of Amendment, preferences and rights of any outstanding series of preferred stock or By-laws, respectively, or (ii) any statute, rule or regulation applicable to the Company or its Subsidiaries and
neither the Company nor its Subsidiaries is in default under any material contract, agreement, mortgage, 
  

 8 

 indebtedness, indenture, instrument, judgment, decree or order, except for defaults as would not, individually or in the
aggregate, have a Material Adverse Effect. The business of the Company and its Subsidiaries is not being conducted, and shall not be conducted, in violation of any law, ordinance or regulation of any governmental entity, except where such violation
would not result in a Material Adverse Effect. Except as specifically contemplated by this Agreement and as required under the 1933 Act and the securities laws of the State of New York and except such as have been obtained as of the date hereof, the
Company is not required to obtain any consent, authorization or order of, or make any filing or registration with, any court or governmental agency or any regulatory or self-regulatory agency in order for it to execute, deliver or perform any of its
obligations under or contemplated by the Transaction Documents or the Certificate of Amendment in accordance with the terms hereof or thereof. Except as disclosed in Schedule 3(e), all consents, authorizations, orders, filings and registrations
which the Company is required to obtain pursuant to the preceding sentence have been obtained or effected on or prior to the date hereof. The Company and its Subsidiaries have no actual knowledge of any facts or circumstances which might reasonably
be expected to give rise to any of the foregoing. The Company is not in violation of the listing requirements of AMEX as in effect on the date hereof and on each of the Closing Dates. 
  
 f. SEC Documents; Financial Statements. Since December 31, 2002, the Company has filed all reports, schedules, forms,
statements and other documents required to be filed by it with the SEC pursuant to the reporting requirements of the 1934 Act, (all of the foregoing filed prior to the date hereof and all exhibits included therein and financial statements and
schedules thereto and documents incorporated by reference therein being hereinafter referred to as the “SEC Documents”). As of their respective dates, the SEC Documents complied in all material respects with the requirements of the 1934
Act and the rules and regulations of the SEC promulgated thereunder applicable to the SEC Documents, and none of the SEC Documents, at the time they were filed with the SEC, contained any untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. As of their respective dates, the financial statements of the Company
included in the SEC Documents complied as to form in all material respects with applicable accounting requirements of the SEC with respect thereto. Such financial statements have been prepared in accordance with generally accepted accounting
principles, consistently applied, during the periods involved (except (i) as may be otherwise indicated in such financial statements or the notes thereto, and (ii) in the case of unaudited interim statements, to the extent they may exclude footnotes
or may be condensed or summary statements) and fairly present in all material respects the financial position of the Company as of the dates thereof and the results of its operations and cash flows for the periods then ended (subject, in the case of
unaudited statements, to normal year-end audit adjustments). Neither the Company nor any of its Subsidiaries or any of their officers, directors, employees or agents have provided a Buyer with any material, nonpublic information. The Company meets
the requirements for the use of Form S-3 for registration of the resale of the Registrable Securities (as defined in the Registration Rights Agreement) by the Buyers. 
  
 g. Absence of Certain Changes. Except as disclosed in reports filed by the Company with the SEC under the Securities
Exchange Act of 1934 (the “1934 Act”) or in Schedule 3(g), since December 31, 2002 there has been no material adverse change and no 
  

 9 

 material adverse development in the business, properties, operations, financial condition, liabilities results of
operations of the Company or its Subsidiaries, taken as a whole. The Company has not taken any steps, and does not currently expect to take any steps, to seek protection pursuant to any bankruptcy law nor does the Company or any of its Subsidiaries
have any actual knowledge that its creditors intend to initiate involuntary bankruptcy proceedings or any actual knowledge of any fact which would reasonably lead a creditor to do so. 
  
 h. Absence of Litigation. Except as disclosed in Schedule 3(h), there is no action, suit, proceeding, inquiry or
investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the Company or any of its Subsidiaries, threatened against or affecting the Company, the Common Stock or any
of the Company’s Subsidiaries or any of the Company’s or the Company’s Subsidiaries’ officers or directors in their capacities as such. Except as set forth in Schedule 3(h), to the knowledge of the Company none of the directors
or officers of the Company have been involved in securities related litigation during the past five years. 
  
 i. Acknowledgment Regarding Buyer’s Purchase of Preferred D Shares. The Company acknowledges that none of the Buyers is acting as a financial
advisor or fiduciary of the Company (or in any similar capacity) with respect to the Transaction Documents and the Certificate of Amendment and the transactions contemplated thereby and any advice given by the Buyers or any of its respective
representatives or agents in connection with the Transaction Documents and the Certificate of Amendment and the transactions contemplated thereby is merely incidental to Buyers’ purchase of the Securities. The Company further represents to
Buyer that the Company’s decision to enter into the Transaction Documents has been based solely on the independent evaluation by the Company and its representatives. 
  
 j. No Undisclosed Events, Liabilities, Developments or Circumstances. Except for the transactions contemplated by
this Agreement, no event, liability, development or circumstance has occurred or exists with respect to the Company or its Subsidiaries or their respective business, properties, operations or financial condition, that would be required to be
disclosed by the Company under applicable securities laws in a registration statement (including by way of incorporation by reference) filed with the SEC relating to an issuance and sale by the Company of its Common Stock and which has not been
publicly disclosed. 
  
 k. No General Solicitation. Neither
the Company, nor any of its affiliates, nor any person acting on its or their behalf, has engaged in any form of general solicitation or general advertising (within the meaning of Regulation D under the 1933 Act) in connection with the offer or sale
of the Securities. 
  
 l. No Integrated Offering. Neither
the Company, nor any of its affiliates, nor any person acting on its or their behalf has, directly or indirectly, made any offers or sales of any security or solicited any offers to buy any security, under circumstances that would require
registration of any of the Securities under the 1933 Act or cause this offering of Securities to be integrated with prior offerings by the Company for purposes of the 1933 Act or any applicable stockholder approval provisions, including, without
limitation, under the rules and regulations of AMEX, nor will the Company or any of its Subsidiaries take any action or steps that would require registration of the Securities under the 1933 Act or cause the offering of the Securities to be
integrated with other offerings. 
  

 10 

 m. Employee Relations. No executive officer (as defined in Rule 501(1) of the 1933 Act) has
notified the Company’s Board of Directors that such officer intends to leave the Company or otherwise terminate such officer’s employment with the Company. 
  
 n. Intellectual Property Rights. The Company and its Subsidiaries own or possess adequate rights or licenses to use
all trademarks, trade names, service marks, service mark registrations, service names, patents, patent rights, copyrights, inventions, licenses, approvals, governmental authorizations, trade secrets and rights necessary to conduct their respective
businesses as now conducted, except where the failure to own or possess such rights would not, individual or in the aggregate, have a Material Adverse Effect. Except as set forth on Schedule 3(n), none of the Company’s trademarks, trade names,
service marks, service mark registrations, service names, patents, patent rights, copyrights, inventions, licenses, approvals, government authorizations, trade secrets or other intellectual property rights have expired or terminated, or are expected
to expire or terminate within two years from the date of this Agreement, except where such expiration or termination would not result, individually or in the aggregate, in a Material Adverse Effect. Except as set forth in the SEC Documents, the
Company and its Subsidiaries do not have any knowledge of any infringement by the Company or its Subsidiaries of trademarks, trade name rights, patents, patent rights, copyrights, inventions, licenses, service names, service marks, service mark
registrations, trade secrets or other similar rights of others, or of any such development of similar or identical trade secrets or technical information by others and, except as set forth on Schedule 3(n), no claim, action or proceeding has been
made or brought against, or to the Company’s knowledge, has been threatened against, the Company or its Subsidiaries regarding trademarks, trade name rights, patents, patent rights, inventions, copyrights, licenses, service names, service
marks, service mark registrations, trade secrets or other infringement; and the Company and its Subsidiaries are unaware of any facts or circumstances which might give rise to any of the foregoing, except where any of the foregoing would not have a
Material Adverse Effect. 
  
 o. Regulatory Permits. Except
the absence of which would not have a Material Adverse Effect, the Company and its Subsidiaries possess all certificates, authorizations and permits issued by the appropriate federal, state or foreign regulatory authorities necessary to conduct
their respective businesses, and neither the Company nor any such Subsidiary has received any notice of proceedings relating to the revocation or modification of any such certificate, authorization or permit. 
  
 p. Internal Accounting Controls. The Company and each of its
Subsidiaries maintain a system of internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management’s general or specific authorizations, (ii) transactions are recorded as
necessary to permit preparation of financial statements in conformity with generally accepted accounting principles and to maintain asset accountability, (iii) access to assets is permitted only in accordance with management’s general or
specific authorization and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. 
  

 11 

 q. Tax Status. The Company and each of its Subsidiaries has made or filed all federal and state
income and all other tax returns, reports and declarations required by any jurisdiction to which it is subject (unless and only to the extent that the Company and each of its Subsidiaries has set aside on its books provisions reasonably adequate for
the payment of all unpaid and unreported taxes) and has paid all taxes and other governmental assessments and charges that are material in amount, shown or determined to be due on such returns, reports and declarations, except those being contested
in good faith and for which the Company has set aside on its books provision reasonably adequate for the payment of all taxes for periods subsequent to the periods to which such returns, reports or declarations apply. There are no unpaid taxes in
any material amount claimed to be due by the taxing authority of any jurisdiction, and the officers of the Company know of no basis for any such claim. 
  
 r. Transactions With Affiliates. Except as set forth in Schedule 3(r) or in the SEC Documents filed at least ten days prior to the date hereof and
other than the grant of stock options disclosed on Schedule 3(c), none of the officers, directors, or employees of the Company are presently a party to any transaction with the Company or any of its Subsidiaries (other than for services as
employees, officers and directors), including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or from, or otherwise requiring payments to or from
any officer, director or such employee or, to the knowledge of the Company, any corporation, partnership, trust or other entity in which any officer, director, or any such employee has a substantial interest or is an officer, director, trustee or
partner. 
  
 s. Application of Takeover Protections.
Assuming that Buyers have no present intention to takeover or to participate in a takeover of the Company, the Company and its board of directors have taken all necessary action, if any, in order to render inapplicable any control share acquisition,
business combination, poison pill (including any distribution under a rights agreement) or other similar anti-takeover provision under the Certificate of Incorporation or the laws of the state of its incorporation which is or could become applicable
to the Buyers as a result of the Buyers and the Company fulfilling their obligations under the Transaction Documents and the Certificate of Amendment, including, without limitation, the Company’s issuance of the Securities and the Buyer’s
ownership of the Securities and securities issued pursuant to (or securities issued or issuable upon conversion or exercise of such Securities). 
  
 t. Rights Agreement. Assuming that Buyers have no present intention to takeover or to participate in a takeover of the Company and so long as the
proviso to the first sentence of Section IV(A) of the Certificate of Amendment remains in full force and effect, the Company specifically represents, warrants and agrees that, (i) in accordance with that certain Rights Agreement dated as of April
23, 1999 (the “Rights Plan”) between the Company and Continental Stock Transfer & Trust Company, as the Rights Agent thereunder, regardless of the number of Conversion Shares of which Buyer is deemed the Beneficial Owner (as defined in
the Rights Plan), Buyer is not intended to be nor will be deemed to be an Acquiring Person within the meaning of the Rights Plan because of the acquisition of the Securities (including the Conversion Shares) pursuant to this Agreement, and (ii) the
acquisition of the Securities (including the Conversion Shares) pursuant to this Agreement, shall not, under any 
  

 12 

 circumstances, trigger a Distribution Date within the meaning of the Rights Plan; provided, however, that only Securities
(including the Conversion Shares) acquired pursuant to this Agreement shall be deemed excluded from the number of shares of Common Stock deemed beneficially owned by Buyers in determining whether a Buyer is an Acquiring Person within the meaning of
the Rights Plan. 
  
 4. COVENANTS. 
  
 a. Best Efforts. Each party shall use its best efforts timely to
satisfy each of the conditions to be satisfied by it as provided in Sections 6 and 7 of this Agreement. 
  
 b. Form D. The Company agrees to file a Form D with respect to the Securities as required under Regulation D and to provide a copy thereof to Buyer
promptly after such filing. The Company shall make all filings and reports relating to the offer and sale of the Securities required under applicable securities or “Blue Sky” laws of the states of the United States following each of the
Closing Dates. 
  
 c. Reporting Status. Until the earlier
of (i) the date on which the Investors (as that term is defined in the Registration Rights Agreement) may sell all of the Conversion Shares without restriction pursuant to Rule 144(k) promulgated under the 1933 Act (or successor thereto) and (ii)
the date on which (A) the Investors have sold all the Conversion Shares and (B) none of the Preferred D Shares is outstanding (the “Reporting Period”), the Company shall use its best efforts to file all reports required to be filed with
the SEC pursuant to the 1934 Act, and the Company shall not terminate its status as an issuer required to file reports under the 1934 Act even if the 1934 Act or the rules and regulations thereunder would otherwise permit such termination.

  
 d. Use of Proceeds. The Company will use the proceeds
from the sale of the Preferred D Shares for working capital. 
  
 e. Financial Information. The Company agrees to promptly send the following to each Investor (as defined in the Registration Rights Agreement) during the Reporting Period: (i) a copy of its Annual Reports on Form 10-K, its Quarterly
Reports on Form 10-Q, any Current Reports on Form 8-K and any registration statements (other than on Form S-8) or amendments filed pursuant to the 1933 Act; (ii) facsimile copies of all press releases issued by the Company or any of its Subsidiaries
and (iii) copies of any notices and other information made available or given to the stockholders of the Company generally, contemporaneously with the making available or giving thereof to the stockholders. 
  
 f. Reservation of Shares. The Company shall take all action necessary
to at all times have authorized, and reserved for the purpose of issuance, the number of shares of Common Stock needed to provide for the issuance of the Conversion Shares and the shares of Common Stock issuable upon exercise of the Warrants.

  
 g. Listing. The Company shall use its best efforts to
promptly secure the listing of all of the Registrable Securities (as defined in the Registration Rights Agreement) upon each national securities exchange and automated quotation system (including AMEX), if any, 
  

 13 

 upon which shares of Common Stock are then listed (subject to official notice of issuance) and shall use its best efforts
to maintain, so long as any other shares of Common Stock shall be so listed, such listing of all Registrable Securities from time to time issuable under the terms of the Transaction Documents and the Certificate of Amendment. Neither the Company nor
any of its Subsidiaries shall take any action which would be reasonably expected to result in the delisting or suspension of the Common Stock on AMEX, Nasdaq or NYSE (other than to switch listings from AMEX, Nasdaq or NYSE). The Company shall
promptly provide to Buyer copies of any notices it receives from AMEX, Nasdaq or NYSE regarding the continued eligibility of the Common Stock for listing on such automated quotation system or securities exchange. The Company shall pay all fees and
expenses in connection with satisfying its obligations under this Section 4(g). 
  
 h. Expenses. Subject to Section 9(1) below, following the Initial Closing, the Company shall reimburse the Buyers for the legal expenses of Grushko & Mittman P.C. in connection with negotiating and
preparing the Transaction Documents and consummating the transactions contemplated thereby up to an aggregate of $10,000. 
  
 i. Transactions With Affiliates. So long as (i) at least 1,000 Preferred D Shares are outstanding or (ii) any Buyer owns Conversion Shares with a
market value of $1,000,000 the Company shall not, and shall cause each of its Subsidiaries not to, enter into, amend, modify or supplement, or permit any Subsidiary to enter into, amend, modify or supplement, any agreement, transaction, commitment
or arrangement with any of its or any Subsidiary’s officers, directors, persons who were officers or directors at any time during the previous two years, stockholders who beneficially own 5% or more of the Common Stock, or affiliates or with
any individual related by blood, marriage or adoption to any such individual or with any entity in which any such entity or individual owns a 5% or more beneficial interest (each a “Related Party”), except for (a) customary employment
arrangements and benefit programs on reasonable terms, (b) any agreement, transaction, commitment or arrangement which is approved by a majority of the disinterested directors of the Company or (c) any agreement, transaction, commitment or
arrangement on an arms-length basis on terms no less favorable than terms which would have been obtainable from a person other than such Related Party. For purposes hereof, any director who is also an officer of the Company or any Subsidiary of the
Company shall not be a disinterested director with respect to any such agreement, transaction, commitment or arrangement. “Affiliate” for purposes hereof means, with respect to any person or entity, another person or entity that, directly
or indirectly, (i) has a 5 % or more equity interest in that person or entity, (ii) has 5 % or more common ownership with that person or entity, (iii) controls that person or entity, or (iv) shares common control with that person or entity.
“Control” or “controls” for purposes hereof means that a person or entity has the power, direct or indirect, to conduct or govern the policies of another person or entity. 
  
 j. Filing of Form 8-K. On or before the next business day following
each of the Closing Dates, the Company shall submit a Form 8-K with the SEC describing the terms of the transaction contemplated by the Transaction Documents and consummated at such Closing, in each case in the form required by the 1934 Act.

  

 14 

 k. Pledge of Securities. The Company acknowledges and agrees that the Securities may be pledged by
an Investor (as defined in the Registration Rights Agreement) in connection with a bona fide margin agreement or other loan or financing transaction secured by the Securities. The pledge of Securities shall not be deemed to be a transfer, sale or
assignment of the Securities hereunder, and no Investor effecting a pledge of Securities shall be required to provide the Company with any notice thereof or otherwise make any delivery to the Company pursuant to this Agreement (including, without
limitation, Section 2(f)), any other Transaction Document or the Certificate of Amendment; provided that an Investor and its pledgee shall be required to comply with the provisions of Section 2(f) hereof in order to effect a sale, transfer or
assignment of Securities to such pledgee. The Company hereby agrees to execute and deliver such documentation as a pledgee of the Securities may reasonably request in connection with a pledge of the Securities to such pledgee by an Investor.

  
 l. Agreements Regarding Series C Preferred Stock. Each
of the Buyers as a holder of Series C Preferred Stock hereby covenants and agrees that such Buyer shall vote or cause to be voted, at any meeting of stockholders of the Company held on or before May 21, 2004, all Preferred C Shares held of record or
beneficially by such Buyer to the extent the Preferred C Shares have any vote on such matter, any proposal to authorize and agree to the issuance and sale of the Preferred D Shares and Warrants as contemplated by this Agreement. 
  
 5. TRANSFER AGENT INSTRUCTIONS. 
  
 The Company shall issue irrevocable instructions to its transfer agent, and
any subsequent transfer agent, to issue upon conversion of Preferred D Shares by a Buyer certificates, registered in the name of such Buyer or its respective nominee(s), for the Conversion Shares issuable upon such conversion of Preferred D Shares,
in such amounts as specified from time to time by such Buyer to the Company (the “Irrevocable Transfer Agent Instructions”). All such certificates shall bear the restrictive legend specified in Section 2(g) of this Agreement except as
otherwise provided in Section 2(g) or in this Section. The Securities shall be freely transferable on the books and records of the Company as and to the extent provided in this Agreement and the Registration Rights Agreement. Nothing in this Section
5 shall affect in any way Buyer’s obligations and agreements set forth in Section 2(g) to comply with all applicable prospectus delivery requirements, if any, upon resale of the Securities. If a Buyer provides the Company with an opinion of
counsel, in a form reasonable satisfactory to the Company, that registration of a resale by Buyer of any of such Securities is not required under the 1933 Act or the Buyer provides the Company with reasonable assurances that the Securities can be
sold pursuant to Rule 144, the Company shall permit the transfer, and, in the case of the Conversion Shares, promptly instruct its transfer agent to issue one or more certificates in such name and in such denominations as specified by Buyer and
without any restrictive legends. The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Buyer by vitiating the intent and purpose of the transaction contemplated hereby. Accordingly, the Company
acknowledges that the remedy at law for a breach of its obligations under this Section 5 will be inadequate and agrees, in the event of a breach or threatened breach by the Company of the provisions of this Section 5, that the Buyer shall be
entitled, in addition to all other available remedies, to an injunction restraining any breach and requiring immediate issuance and transfer, without the necessity of showing economic loss and without any bond or other security being required.

  

 15 

 6. CONDITIONS TO THE COMPANY’S OBLIGATION TO SELL. 
  
 a. Initial Closing Date. The obligation of the Company hereunder to
issue and sell the Initial Preferred Shares to Buyers at the Initial Closing is subject to the satisfaction, at or before the Initial Closing Date, of each of the following conditions, provided that these conditions are for the Company’s sole
benefit and may be waived by the Company at any time in its sole discretion: 
  
 (i) Buyers shall have executed each of the Transaction Documents to which they are a party and delivered the same to the Company. 
  
 (ii) The Certificate of Amendment shall have been filed with the Secretary of State of the State of New
York. 
  
 (iii) Buyers shall have delivered to
the Company the Purchase Price for the Initial Preferred Shares (and Warrants) being purchased by Buyers at the Initial Closing by wire transfer of immediately available funds pursuant to the wire instructions provided by the Company. 
  
 (iv) The representations and warranties of Buyers contained
herein shall be true and correct as of the date when made and as of the Initial Closing Date as though made at that time (except for representations and warranties that speak as of a specific date, which shall be true as of that date), and the
Buyers shall have performed, satisfied and complied with the covenants, agreements and conditions required by the Transaction Documents to be performed, satisfied or complied with by Buyer at or prior to the Initial Closing Date. The Company shall
have received a certificate from each Buyer, executed by the Chief Executive Officer of such Buyer or other person reasonably satisfactory to the Company, dated as of the Initial Closing Date, to the foregoing effect. 
  
 (v) The Buyers shall have purchased an aggregate of
582.887593 shares of the Series C Preferred Stock from the previous holder of such stock, and the Buyers who purchased such Series C Preferred Stock shall have executed the Acknowledgement and Waiver Agreement of even date herewith. 
  
 b. Additional Closing Date. 
  
 (i) The obligation of the Company hereunder to issue and
sell the Additional Preferred D Shares to Buyers at the Additional Closing is subject to the satisfaction, at or before the Additional Closing Date, of each of the following conditions, provided that these conditions are for the Company’s sole
benefit and may be waived by the Company at any time in its sole discretion: 
  
  

 16 

	 	A.	The Buyers shall have delivered to the Company the Purchase Price for the Additional Preferred D Shares (and Warrants) being purchased by Buyers at the Additional Closing by wire
transfer of immediately available funds pursuant to the wire instructions provided by the Company. 

  

	 	B.	The representations and warranties of Buyers contained herein shall be true and correct as of the date when made and as of the applicable Additional Closing Date as though made at
that time (except for representations and warranties that speak as of a specific date, which shall be true as of that date), and Buyers shall have performed, satisfied and complied with the covenants, agreements and conditions required by the
Transaction Documents to be performed, satisfied or complied with by Buyers at or prior to the Additional Closing Date. The Company shall have received a certificate from each Buyer, executed by the Chief Executive Officer of such Buyer or other
person reasonably satisfactory to the Company, dated as of the Initial Closing Date, to the foregoing effect. 

  

	 	C.	The Stockholder Approval Condition has been satisfied. 

  
 7. CONDITIONS TO BUYER’S OBLIGATION TO PURCHASE. 
  
 a. Initial Closing Date. The obligation of Buyers hereunder to purchase the Initial Preferred Shares at the Initial Closing is subject to the
satisfaction, at or before the Initial Closing Date, of each of the following conditions, provided that these conditions are for the sole benefit of the Buyers and may be waived by a Buyer, with respect to it, at any time in its sole discretion:

  
 (i) The Company shall have executed each of
the Transaction Documents, and delivered the same to Buyers. 
  
 (ii) The Certificate of Amendment, shall have been filed with the Secretary of State of the State of New York, and a copy thereof certified by such Secretary of State shall have been delivered to Buyers. 

 
 (iii) The Common Stock shall be authorized for quotation
on AMEX or the NYSE, or The Nasdaq Stock Market and shall not have been suspended from trading on or delisted from such markets nor shall delisting or suspension by such markets have been threatened in writing. 
  
 (iv) The representations and warranties of the Company
contained herein shall be true and correct as of the date when made and as of the Initial Closing Date as though made at that time (except for representations and warranties that speak as of a specific date, which are true as of that date) and the
Company shall have performed, satisfied and 
  

 17 

 complied with the covenants, agreements and conditions required by the Transaction Documents or
Certificate of Amendment to be performed, satisfied or complied with by the Company at or prior to the Initial Closing Date. Buyer shall have received a certificate, executed by the Chief Executive Officer of the Company, dated as of the Initial
Closing Date, to the foregoing effect, which also shall include an update as of the Initial Closing Date regarding the representation contained in Section 3(c) above. 
  
 (v) Buyer shall have received the opinion of Muldoon Murphy & Faucette LLP, dated as of the Initial
Closing Date, in substantially the form of Exhibit V attached hereto. 
  
 (vi) The Company shall have executed and shall deliver to Buyers the Stock Certificates for the Initial Preferred Shares and the Warrants being purchased by Buyers at the Initial Closing. 
  
 (vii) The Company shall have delivered to Buyers a
certificate evidencing the incorporation and good standing of the Company in its state of incorporation issued by the Secretary of State of such state of incorporation as of a date within ten days of the Initial Closing Date. 
  
 (viii) The Company shall have delivered to Buyers a
secretary’s certificate certifying as to (A) the Resolutions, (B) the Certificate of Incorporation, (C) By-laws and (D) the number of shares of Common Stock outstanding as of a date within five (5) days of the Initial Closing, each as in effect
at the Initial Closing Date. 
  
 (ix) The Buyers
shall have purchased an aggregate of 582.887593 shares of Series C Preferred Stock from the previous holder of such stock. 
  
 b. Additional Closing Date. 
  
 (i) The obligation of Buyers hereunder to purchase Additional Preferred Shares at the Additional Closing is subject to the satisfaction,
at or before the Additional Closing Date, of each of the following conditions, provided that these conditions are for sole benefit of the Buyers and may be waived by a Buyer, with respect to it, at any time in its sole discretion: 
  

	 	A.	The Certificate of Amendment shall be in full force and effect and shall not have been amended, without the knowledge or consent of the Buyers, since the Initial Closing Date, and a
copy thereof certified by the Secretary of State of the State of New York shall have been delivered to Buyers. 

  

	 	B.	The Common Stock shall be authorized for quotation on AMEX, and shall not have been suspended from trading on or delisted from such market, nor shall delisting or suspension by such
market have been threatened in writing. 

  

 18 

	 	C.	The representations and warranties of the Company shall be true and correct as of the date when made and as of the Additional Closing Date as though made at that time (except for
representations and warranties that speak as of a specific date which shall be true as of that date) and the Company shall have performed, satisfied and complied with the covenants, agreements and conditions required by the Transaction Documents or
the Certificate of Amendment to be performed, satisfied or complied with by the Company at or prior to the Additional Closing Date. Buyer shall have received a certificate, executed by the Chief Executive Officer of the Company, dated as of the
Additional Closing Date, to the foregoing effect which also shall include an update as of the Additional Closing Date regarding the representation contained in Section 3(c) above. 

  

	 	D.	Buyers shall have received the opinion of Muldoon Murphy & Faucette LLP, dated as of the Additional Closing Date in substantially the form of Exhibit V attached hereto.

  

	 	E.	The Company shall have executed and shall deliver to Buyers the Stock Certificates for the Additional Preferred Shares and the Warrants being purchased by Buyer at the Additional
Closing. 

  

	 	F.	The Company shall have delivered to Buyers a certificate evidencing the incorporation and good standing of the Company in its state of incorporation issued by the Secretary of State
of such state of incorporation as of a date within ten days of the Additional Closing Date. 

  

	 	G.	The Company shall have delivered to Buyers a secretary’s certificate certifying as to (A) the Resolutions, (B) the Certificate of Incorporation and (C) By-laws and (D) the
number of shares of Common Stock outstanding as of a date within five (5) days of the Additional Closing Date, each as in effect at the Additional Closing. 

  

	 	H.	The Registration Statement required by Section 2(a) of the Registration Rights Agreement is effective. 

  

	 	I.	The Stockholder Approval Condition has been satisfied. 

  
 8. RESERVED 
  

 19 

 9. GOVERNING LAW; MISCELLANEOUS. 
  
 a. Governing Law; Jurisdiction; Jury Trial. The corporate laws of the State of New York shall govern all issues
concerning the relative rights of the Company and its stockholders. All other questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by the internal laws of the State of New York, without
giving effect to any choice, of law or conflict of law provision or rule (whether of the State of New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New York. Each party
hereby irrevocably submits to the non-exclusive jurisdiction of the state and federal courts sitting in the City of New York, borough of Manhattan for the adjudication of any dispute hereunder or in connection herewith or with any transaction
contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or
proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper. Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or
proceeding by mailing a copy thereof to such party at the address for such notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be
deemed to limit in any way any right to serve process in any manner permitted by law. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION
HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY. 
  
 b. Counterparts. This Agreement may be executed in two or more identical counterparts, all of which shall be considered one and the same agreement and shall become effective when counterparts have been signed
by each party and delivered to the other party; provided that a facsimile signature shall be considered due execution and shall be binding upon the signatory thereto with the same force and effect as if the signature were an original, not a
facsimile signature. 
  
 c. Headings. The headings of this
Agreement are for convenience of reference and shall not form part of, or affect the interpretation of, this Agreement. 
  
 d. Severability. If any provision of this Agreement shall be invalid or unenforceable in any jurisdiction, such invalidity or unenforceability
shall not affect the validity or enforceability of the remainder of this Agreement in that jurisdiction or the validity or enforceability of any provision of this Agreement in any other jurisdiction. 
  
 e. Entire Agreement; Amendments. This Agreement supersedes all other
prior oral or written agreements between the Buyers, the Company, their affiliates and persons acting on their behalf with respect to the matters discussed herein, and this Agreement and the instruments referenced herein contain the entire
understanding of the parties with respect to the matters covered herein and therein and, except as specifically set forth herein or therein, neither the Company nor any Buyer makes any representation, warranty, covenant or undertaking with

  

 20 

 respect to such matters; provided, however, that nothing in this Section 9(e) shall be deemed to supersede or affect the
agreements or understandings between the parties with respect to the Series B Preferred Stock and the warrants issued in connection therewith. No provision of this Agreement may be amended other than by an instrument in writing signed by the Company
and the Buyer, and no provision hereof may be waived other than by an instrument in writing signed by the party against whom enforcement is sought. No such amendment shall be effective as to a holder of the Preferred D Shares then outstanding to the
extent it was not agreed to by such holder or a previous holder of such Preferred D Shares. 
  
 f. Notices. Any notices, consents, waivers or other communications required or permitted to be given under the terms of this Agreement must be in writing and will be deemed to have been delivered (i) upon
receipt, when delivered personally; (ii) upon receipt, when sent by facsimile (provided confirmation of transmission is mechanically or electronically generated and kept on file by the sending party); or (iii) upon delivery by a nationally
recognized delivery service, in each case properly addressed to the party to receive the same. The addresses and facsimile numbers for such communications shall be: 
  

					
	 If to the Company:

		
	 	 	 Andrea Electronics Corporation

	 	 	 45 Melville Park Road

	 	 	 Melville, New York 11747

	 	 	 Telephone:
	  	 (516) 719-1800

	 	 	 Facsimile:
	  	 (516) 719-1824

	 	 	 Attention:
	  	 President, Chief Executive Officer

	
	 With a copy to:

		
	 	 	 Andrea Electronics Corporation

	 	 	 45 Melville Park Road

	 	 	 Melville, New York 11747

	 	 	 Telephone:
	  	 (516) 719-1800

	 	 	 Facsimile:
	  	 (516) 719-1824

	 	 	 Attention:
	  	 Executive Vice President, Chief Financial Officer

	
	 If to the Transfer Agent:

		
	 	 	 Continental Stock Transfer & Trust Company

	 	 	 Two Broadway

	 	 	 New York, New York 10004

	 	 	 Telephone:
	  	 (212) 509-4000

	 	 	 Facsimile:
	  	 (212) 509-7616

	 	 	 Attention:
	  	 Compliance Officer

  

 21 

 If to a Buyer, to it at the address and facsimile number set forth on the Schedule of Buyers, with copies
to Buyer’s representatives as set forth on the Schedule of Buyers, or at such other address and/or facsimile number and/or to the attention of such other person as the recipient party has specified by written notice given to each other party
five days prior to the effectiveness of such change. Written confirmation of receipt (A) given by the recipient of such notice, consent, waiver or other communications, (B) mechanically or electronically generated by the sender’s facsimile
machine containing the time, date, recipient facsimile number and an image of the first page of such transmission or (C) provided by a nationally recognized overnight delivery service shall be rebuttable evidence of personal service, receipt by
facsimile or receipt from a nationally recognized overnight delivery service in accordance with clause (i), (ii) or (iii) above, respectively. 
  
 g. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and
assigns, including any purchasers of the Preferred D Shares. The parties shall not assign this Agreement or any rights or obligations hereunder without the prior written consent of the other parties. Notwithstanding the foregoing, any assignment by
a Buyer shall not release the Buyer from its obligations hereunder unless such obligations are assumed by such assignee and the Company has consented to such assignment and assumption, which consent shall not be unreasonably withheld. 
  
 h. No Third Party Beneficiaries. This Agreement is intended for the
benefit of the parties hereto and their respective permitted successors and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other person. 
  
 i. Survival. Unless this Agreement is terminated under Section 9(l), the representations and warranties of the
Company and the Buyer contained in Sections 2 and 3 and the agreements and covenants set forth in Sections 4, 5 and 9 shall survive each of the Closings. 
  
 j. Publicity. The Company and Buyer shall have the right to approve before issuance any press releases or any other public statements with respect
to the transactions contemplated hereby; provided, however, that the Company shall be entitled, without the prior approval of any Buyer, to make any press release or other public disclosure with respect to such transactions as is required by
applicable law and regulations (although Buyer shall be consulted by the Company in connection with any such press release or other public disclosure prior to its release and shall be provided with a copy thereof). 
  
 k. Further Assurances. Each party shall do and perform, or cause to be
done and performed, all such further acts and things, and shall execute and deliver all such other agreements, certificates, instruments and documents, as the other party may reasonably request in order to carry out the intent and accomplish the
purposes of this Agreement and the consummation of the transactions contemplated hereby. 
  
 l. Termination. In the event that the Initial Closing shall not have occurred on or before ten (10) Business Days from the date hereof due to the Company’s or Buyers’ failure to satisfy the conditions
set forth in Sections 6 and 7 above (and the non-breaching party’s failure to waive such unsatisfied condition(s)), the non-breaching party shall have the option to 
  

 22 

 terminate this Agreement with respect to such breaching party at the close of business on such date without liability of
any party to any other party; provided, however, that if this Agreement is terminated pursuant to this Section 9(1) by the Buyers, the Company shall remain obligated to reimburse the non-breaching Buyer for expenses up to the amount described in
Section 4(i) above. 
  
 m. Placement Agent. The Company and
the Buyers each acknowledge that it has not engaged any placement agent in connection with the sale and purchase, respectively, of the Preferred D Shares, and the Exchange, except that the Company has engaged Knights Bridge Capital as financial
advisor in connection with such transactions. 
  
 n. No Strict
Construction. The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and no rules of strict construction will be applied against any party. 
  
 o. Remedies. Buyer and each holder of the Securities shall have all
rights and remedies set forth in the Transaction Documents and the Certificate of Amendment and all rights and remedies which such holders have been granted at any time under any other agreement or contract and all of the rights which such holders
have under any law. Any person having any rights under any provision of this Agreement shall be entitled to enforce such rights specifically (without posting a bond or other security), to recover damages by reason of any breach of any provision of
this Agreement and to exercise all other rights granted by law. 
  
 p. Payment Set Aside. To the extent that the Company makes a payment or payments to the Buyers hereunder or pursuant to the Registration Rights Agreement or the Certificate of Amendment or the Buyers enforce or exercise their rights
hereunder or thereunder, and such payment or payments or the proceeds of such enforcement or exercise or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside, recovered from, disgorged by or are
required to be refunded, repaid or otherwise restored to the Company, a trustee, receiver or any other person under any law (including, without limitation, any bankruptcy law, state or federal law, common law or equitable cause of action), then to
the extent of any such restoration the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such enforcement or setoff had not occurred.

  
 * * * * * * 
  

 23 

 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their duly
authorized officers as of the date first above written. 
  
  

			
	 	 	Andrea Electronics Corporation
		
	 By:
	 	 /s/    Paul E. Donofrio

	 	 	Paul E. Donofrio
	 	 	President and Chief Executive Officer

  

			
	 	 	 Investors:
  
 ALPHA CAPITAL AKTIENGESELLSCHAFT

	 
		
	 By:
	 	 /s/    Konrad Adermann

	 	 	 Konrad Adermann

	 	 	 Director

  

			
	 	 	CONGREGATION MISHKAN SHOLOM INCORPORATED
		
	 By:
	 	 /s/    Menachem Lipsher

	 	 	 Menachem Lipsher

	 	 	 CFO

  

			
	 	 	STONESTREET LIMITED PARTNERSHIP
		
	 By:
	 	 /s/    Michael Funkelsten

	 	 	 Michael Funkelsten

	 	 	 President

  

			
	 	 	GREENWICH GROWTH FUND LIMITED
		
	 By:
	 	 /s/    Evan Schmenauer

	 	 	 Evan Schmenauer

	 	 	 Director

  

 24 

			
	 	 	WHALEHAVEN FUNDS LIMITED
		
	 By:
	 	 /s/    Evan Schmenauer

	 	 	 Evan Schmenauer

	 	 	 Director

  

			
	 	 	ELLIS INTERNATIONAL LTD.
		
	 By:
	 	 /s/    Wilheim Ungar

	 	 	 Wilheim Ungar

	 	 	 Officer

  

			
	 	 	LONGVIEW EQUITY FUND, LP
		
	 By:
	 	 /s/    Michael Rudolph

	 	 	 Michael Rudolph

	 	 	 Investment Manager

  

			
	 	 	LONGVIEW INTERNATIONAL EQUITY FUND, LP
		
	 By:
	 	 /s/    Michael Rudolph

	 	 	 Michael Rudolph

	 	 	 Investment Manager

  

			
	 	 	LONGVIEW FUND LP
		
	 By:
	 	 /s/    Michael Rudolph

	 	 	 Michael Rudolph

	 	 	 Investment Manager

  

			
	 	 	ENABLE GROWTH PARTNERS
		
	 By:
	 	 /s/    Mitch Levine

	 	 	 Mitch Levine

	 	 	 Managing Partner

  

 25 

			
	 	 	REDWOOD CAPITAL PARTNERS, INC.
		
	 By:
	 	 /s/    Richard Rosenblum

	 	 	 Richard Rosenblum 

	 	 	 President

  

			
	 	 	CAMDEN INTERNATIONAL LTD.
		
	 By:
	 	 /s/    Deirdre M. McCoy

	 	 	 Deirdre M. McCoy

	 	 	 Director

  

			
	 	 	GAMMA OPPORTUNITY CAPITAL PARTNERS, LP
		
	 By:
	 	 /s/    Jonathan P. Knight

	 	 	 Jonathan P. Knight

	 	 	 Director

  

			
	 	 	DOMINO INTERNATIONAL LTD.
		
	 By:
	 	 /s/    Anthony L.M. Inder Reiden

	 	 	 Anthony L.M. Inder Reiden

	 	 	 Director

  

			
	 	 	PALISADES MASTER FUND, LP
		
	 By:
	 	 /s/    Discover Management LTD

	 	 	 Discover Management LTD 

	 	 	 Authorized Signatory

  

 26 

			
	 	 	LUCRATIVE INVESTMENTS
		
	 By:
	 	 /s/    Lucrative Investments

	 	 	 [Name]

	 	 	 [Title]

  
  

			
	 	 	ADVANTAGE FUND I, LLC
		
	 By:
	 	 /s/    Robert Press

	 	 	 Robert Press

	 	 	 President

  
  

			
	 	 	GRQ CONSULTANTS, INC.
		
	 By:
	 	 /s/    Barry Honig

	 	 	 Barry Honig

	 	 	 President

  
  

			
	 	 	S.O.S. RESOURCE SERVICES, INC.
		
	 By:
	 	 /s/    Salvatore Russo

	 	 	 Salvatore Russo

	 	 	 President

  

 27

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