Document:

Override Agreement

 EXHIBIT 10.1 
 OVERRIDE AGREEMENT 
 THIS OVERRIDE AGREEMENT, dated as of March 17, 2008 (this
“Agreement”), is made by and among Thornburg Mortgage Inc. (“TMI”), Thornburg Mortgage Hedging Strategies, Inc. (“TMHS” and, together with TMI, “TMA”) and each entity designated on
the signature pages hereto as a “Counterparty” (each a “Counterparty” and, collectively, the “Counterparties”). 
 RECITALS: 
 WHEREAS, the Counterparties and TMA are parties to those Master Repurchase Agreements,
Global Master Securities Lending Agreements and/or auction rate swap and other specified transactions under ISDA Master Agreements (“Auction Swaps” and “Other Specified Transactions”, as identified on Schedule I)
set forth with respect to each Counterparty on Schedule I (including in each case each of the related agreements and corresponding confirmations thereunder, each a “Financing Agreement” and, collectively, the “Financing
Agreements”); and, for avoidance of doubt, the Financing Agreements do not include any agreements or transactions not listed on Schedule I (even though such transactions may be governed by master agreements identified on Schedule I); and

 WHEREAS, the Counterparties and TMA have agreed (a) that certain of the existing terms of each of the Financing Agreements be
overridden for a specified period, and (b) to certain other matters, in each case subject to and on the terms and conditions set forth in this Agreement; 
 NOW, THEREFORE, in consideration of the premises and mutual obligations set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, each Counterparty,
severally and not jointly, and TMA hereby agree as follows: 
 SECTION 1. This Agreement shall have a term and shall be terminable as follows:

 (a) Override Period. This Agreement shall be effective for a period of 364 days from the date hereof (the period
prior to termination of this Agreement being referred to herein as the “Override Period”) unless earlier rescinded, replaced or modified by all parties hereto in writing or terminated by TMA or the Counterparties in accordance with
Section 1(b) or 1(c). 
 (b) Termination by TMA. TMA may terminate this Agreement; provided that
termination by TMA must be with respect to all Counterparties at the same time and provided further that TMA may terminate this Agreement in accordance with this Section 1(b) only if all Counterparties have consented to such termination
or each Counterparty has confirmed in writing (which confirmation will not be unreasonably withheld or delayed) that all of the Payment Obligations owed to it under all of its Financing Agreements have been fully satisfied and the related
transactions have terminated (the “Compliance Requirements”). 

 (c) Termination by Counterparties. Upon written notice to TMA and the other
Counterparties, any Counterparty may terminate this Agreement with respect to itself in any of the following circumstances (an “Override Termination Event”): 
 (i) TMA fails to pay an amount that it has agreed to pay under Section 2(f), 2(g), 3(b), 3(n) or 3(o); 
 (ii) TMA fails to effect the Capital Raise as provided in Section 3(a); 
 (iii) TMA fails to maintain the Liquidity Fund as provided in Section 3(c) for three consecutive months, or the balance of the
Liquidity Fund shall at any time be less than 50% of the Liquidity Maintenance Amount required pursuant to Section 3(c); 
 (iv) TMA voluntarily becomes a debtor in a proceeding under the Bankruptcy Code; 
 (v) TMA involuntarily becomes a
debtor in a proceeding under the Bankruptcy Code and the proceeding is not dismissed within 15 business days; 
 (vi) TMA
breaches any of its covenants in Sections 2(i), 3(c) (solely with respect to the Permitted Investments), 3(d), 3(e), 3(f), 3(g), 3(i), 3(j) and 3(k), and any such breach is not cured within ten business days after receipt by TMA of written notice
thereof from any Counterparty; or 
 (vii) there is a Change in Control (as defined below in Section 17). 
 (d) In the event of expiration of this Agreement pursuant to Section 1(a) or termination of this Agreement pursuant to
Section 1(b), such expiration or termination shall become effective simultaneously with respect to all parties hereto, and in the event of termination of this Agreement pursuant to Section 1(c), such termination shall become effective with
respect to such Counterparty only and not with respect to any other Counterparties, in each case, as of 5:00 P.M. (New York City time) on the effective date thereof, whereupon none of the provisions of this Agreement (and any agreement giving effect
to the provisions hereof) shall have any further force or effect, and the Financing Agreements shall operate as if TMA and the Counterparties had not executed this Agreement, except that (i) in the event of expiration pursuant to
Section 1(a) if the Compliance Requirements are satisfied or termination pursuant to Section 1(b), Sections 3(g), 14 and 15 (and any agreement giving effect to the provisions thereof) shall survive such expiration or termination and
(ii) in the event of expiration pursuant to Section 1(a) if the Compliance Requirements are not satisfied or any termination pursuant to Section 1(c), Sections 3(c), 3(d), 3(e), 3(g), 14 and 15 (and any agreement giving effect to the
provisions thereof) shall survive such expiration or (with respect to such Counterparty) such termination. 
 SECTION 2. Certain Terms
Overridden During Override Period. Solely during the Override Period, the existing terms of each of the Financing Agreements shall be overridden, suspended and superseded to the extent set forth below: 
 (a) Extension of Maturity. The “Repurchase Date”, “Cash Settlement Date”, “Physical Settlement Date”,
“Maturity Date”, “Early Termination Date” (or any specified date of like meaning) of such Financing Agreement shall be deemed to be March 16, 2009. 
  

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 (b) Margin Call Standstill for Collateral. Except as contemplated in
Section 2(c), each Counterparty agrees that it will not invoke a margin maintenance requirement, credit support requirement or capital call (or any process of like import, including calls with respect to reference collateral under Auction
Swaps, a “Margin Call”) or otherwise exercise remedies under applicable non-bankruptcy law during the Override Period with respect to any “Purchased Securities” or “Collateral” (or any term of like meaning,
including margin collateral with respect to Auction Swaps) that is rated the equivalent of Standard & Poors “AAA”, “AA”, “A”, “BBB”, “BB”, or “B” or is unrated as of the date
hereof or is a mortgage-backed security subject to a Financing Agreement (collectively and as to each Financing Agreement individually, the “Collateral”). 
 (c) Haircuts. Haircuts on Collateral shall equal the levels for specified types of Collateral set forth on Schedule II. If any
security is downgraded, the applicable haircut after the date of the downgrade for that security will be reset at the appropriate level specified in Schedule II. 
 (d) Spread. With respect to the AAA and AA-rated Collateral (“Senior Collateral”), the interest rate for the Financing
Agreements shall be reset monthly and shall not exceed one-month LIBOR plus a spread equal to 35 basis points. With respect to any Collateral other than Senior Collateral (“Junior Collateral”), the interest rate spreads over
LIBOR for the Financing Agreements shall not be affected by this Agreement. 
 (e) Pricing Mechanics. To determine the
market value for purposes of this Agreement of any item of Collateral which is downgraded after the execution date of this Agreement, the applicable Counterparty shall obtain market value quotes from the other Counterparties that are parties to
Financing Agreements backed by Collateral of the same type. If after having actually consulted such broker-dealers four quotes are obtained, the applicable Counterparty shall average the four quotes. If more than four such quotes are available, the
applicable Counterparty shall discard the highest and lowest quotes and then average the remaining market value quotes. If fewer than four such quotes are available, the applicable Counterparty shall provide its own quote in lieu of the missing
quotes based on its own good faith determination and then average the quotes obtained and its own quote. 
 (f) Collection
and Application of Collateral Payments. The Counterparties shall collect all principal and interest payments with respect to Collateral. Each Counterparty shall apply 100% of any payments of principal (including prepayments) received by such
Counterparty from Collateral and 20% of any payments of interest received by such Counterparty with respect to Collateral against the “Repurchase Price” or other applicable outstanding payment, margin, and mark-to-market deficiencies and
other payment obligations under the corresponding Financing Agreements (collectively 

  

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the “Payment Obligations”). So long as no Override Termination Event has occurred and is continuing, each Counterparty shall remit to TMA on
the business day following the receipt of such amount all payments with respect to Collateral received by such Counterparty that it did not apply to the Payment Obligations as provided in the preceding sentence. 
 (g) Increase in Application of Collateral Payments. If the outstanding balances of the Payment Obligations owed to any Counterparty
on a date set forth on Schedule III are greater than the amount set forth for that date on Schedule III with respect to such Counterparty and continue to exceed that amount for the following thirty days, then the portion of interest payments to be
applied pursuant to Section 2(f) by such Counterparty shall be increased from 20% to 30% beginning on the thirty-first day and continuing for so long as the outstanding balances of the Payment Obligations owed to such Counterparty on any day
exceed the amounts set forth on Schedule III with respect to such Counterparty for the thirty days prior to that day. 
 (h)
Increase in Value of Collateral. The Counterparties shall not be obligated during the Override Period to return to TMA any Collateral (or any portion of Collateral) if the value of Collateral increases, even if the Counterparties would have
been required to return to TMA such Collateral (or any portion of such Collateral) pursuant to the Financing Agreements. 
 (i) Incentive Management Fee. Any incentive management fee (but not base fee) payable by TMA to its external manager, Thornburg Mortgage Advisory Corporation (the “Manager”) during the Override Period, shall be
accrued, but not paid to the Manager. An amount equal to such accrued, but not paid, incentive management fee (the “Accrued Incentive Fee”) shall instead be paid to the Counterparties pro rata for application to the Payment
Obligations on the date that such incentive management fee otherwise would have been paid to the Manager and shall be applied to reduce the Payment Obligations. The Manager agrees (i) to subordinate its right to payment of any Accrued Incentive
Fee to any deficiency suffered by the Counterparties under the Financing Agreements, and (ii) to enter into any agreement reasonably requested by the Counterparties to confirm such subordination. Additionally, no cash payments by TMA shall be
made on account of any long-term incentive awards during the Override Period. 
 SECTION 3. Agreements of TMA. TMA agrees: 

(a) on or before the third business day following the execution date of this Agreement, to obtain commitments to raise at least $1
billion of new capital (the “Capital Raise”), and on or before the seventh business day following the execution date of this Agreement, to receive net proceeds of at least $948 million of the Capital Raise; 
 (b) promptly upon (and in any event no later than the next business day after) receipt of the net proceeds of the Capital Raise, to pay
(i) all unmet margin calls on the Collateral that were outstanding as of March 5, 2008, after giving effect to the haircuts specified pursuant to Section 2(d), in the amounts specified in Schedule II and (ii) $470 million
less the amount paid pursuant to clause (i) of this subsection to the Counterparties on account of the Payment Obligations, pro rata; 
  

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 (c) to establish and maintain a securities account (the “Liquidity
Fund”) with the market value of $350 million. The portion of the Liquidity Fund equal to 5% of the principal balance of TMA’s obligations under the Financing Agreements that are Master Repurchase Agreements outstanding from time to
time (the “Liquidity Maintenance Amount”) shall be funded by one or more of the following (the “Permitted Investments”): (A) cash, treasuries or agency pass-through securities and (B) up to $200 million in
market value of AAA, mezzanine or below-rated mortgage securities issued in connection with TMA’s securitizations effected after the date hereof and backed by mortgage loans originated by TMA or its affiliates; provided that in no event
shall the market value of such securities that are rated below investment grade exceed one-third of the Liquidity Maintenance Amount. Any determination of the amount in the Liquidity Fund using market value quotes from the Counterparties averaged in
a manner substantially similar to that described in Section 2(e) shall be conclusive and binding on TMA and the Counterparties. Such determinations shall be made at least once a month on a date agreed by the Counterparties and TMA, and may be
made on any other day in the sole discretion of the Counterparties. Notwithstanding the foregoing, if any Collateral that is a mortgaged-backed security is downgraded and its price and haircut are adjusted, TMA may use any cash or securities in
the Liquidity Fund to satisfy TMA’s Payment Obligations arising as a result of such adjustments (other than its Payment Obligations under the Auction Swaps), and such cash and securities used by TMA shall be deemed to remain in the
Liquidity Fund for the purpose of satisfying the Liquidity Maintenance Amount; 
 (d) within ten business days of execution of
this Agreement, to (i) grant to the Counterparties a pro rata first priority security interest in TMA’s mortgage servicing rights, and the Liquidity Fund pursuant to documentation in form and substance reasonably satisfactory to the
Counterparties, which security interest the Counterparties may perfect; provided that the Counterparties shall not exercise remedies with respect to such security interest prior to an occurrence of an Override Termination Event and
provided that TMA may invest the amounts in the Liquidity Fund in Permitted Investments that were not included in the Liquidity Fund on the date hereof so long as such investments remain subject to the security interest, and (ii) grant
to the Counterparties a first priority security interest in Collateral pursuant to documentation in form and substance reasonably satisfactory to the Counterparties, which security interest the Counterparties may perfect, whereby (A) any
Collateral held by any Counterparty shall secure all obligations of TMA and its affiliates to such Counterparty or its affiliates under the Financing Agreements or otherwise and (B) any excess Collateral held by any Counterparty and remaining
after application of such Collateral to satisfy TMA’s final obligations to such Counterparty or its affiliates shall secure all obligations of TMA and its affiliates to the other Counterparties and their respective affiliates under the
Financing Agreements or otherwise (but shall be allocated to the other Counterparties, pro rata); 
 (e) in the event that TMA
sells its mortgage servicing rights, it will pay the net proceeds to the Counterparties pro rata to reduce the outstanding Payment 

  

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Obligations. Any sale of mortgage servicing rights during the Override Period by TMA shall be effected in cash at a price, confirmed by an independent
third-party valuation reasonably acceptable to TMA and the Counterparties that would have been obtained in an at-arms-length transaction. TMA shall not change during the Override Period the sub-servicer servicing the mortgage loans subject to the
mortgage servicing rights without the prior written consent of the Counterparties, which consent shall not be unreasonably withheld or delayed; 
 (f) to suspend TMI’s common dividend for the Override Period, provided that TMI may declare in December 2008, for payment in January of the following calendar year, a dividend of up to 87% of TMI’s
taxable income for the calendar year 2008 and to suspend its preferred dividend if the amounts in the Liquidity Fund fall below the Liquidity Maintenance Amount for three consecutive months; 
 (g) promptly upon receipt of any required legal and regulatory approvals, including any approval from the New York Stock Exchange, and
completion of the Capital Raise, to issue to the Counterparties 46,960,000 million of “penny” warrants for TMI common stock (with amounts to be issued to each Counterparty as set forth on Schedule IV). Each such warrant will be
exercisable for a period of 5 years at an exercise price of $0.01 per share; 
 (h) during the period extending through the
date of the first anniversary of the execution date of this Agreement (and whether or not this Agreement has been terminated), to offer each Counterparty the opportunity to act with respect to TMA’s securitizations, (i) on a rotating basis
among all Counterparties, as sole lead manager and (ii) as co-lead manager on each securitization in which such Counterparty is not acting as sole lead manager; 
 (i) during the Override Period, not to enter into any new transactions under existing, or into any new, Master Repurchase Agreements,
securities lending agreements or ISDA Master Agreements or to deliver any additional collateral thereunder other than as provided herein. This provision does not prevent (i) the maintenance, renewal, or refinancing of the Financing Agreements,
and (ii) the maintenance, renewal, or refinancing of the warehouse lending agreements to which TMA is a party (with existing lenders (including Counterparties) or with new lenders) in an aggregate amount not to exceed $700 million outstanding
at any one time. This provision also does not apply to interest rate cap, corridor and swap agreements; 
 (j) to provide to
the Counterparties (i) no later than the 15th day of each month, a monthly report setting forth in reasonable detail its compliance with Sections 2(f), 3(c), and 3(i) for the prior month and (ii) prompt notice of the occurrence of an
Override Termination Event; 
 (k) [Reserved]; 
 (l) within 60 days of execution of this Agreement, to terminate in an orderly manner its Master Repurchase Agreements with Merrill Lynch;

  

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 (m) to pay in connection with the Capital Raise at least 20% of the placement agent fee
or underwriter fee of Friedman Billings Ramsey in the securities of TMI issued in connection with the Capital Raise on such terms and during such timeframe as TMA and Friedman Billings Ramsey may mutually agree if Friedman Billings Ramsey is the
sole placement agent or underwriter; 
 (n) within 8 business days of execution of this Agreement, to pay $50 million in the
aggregate to Royal Bank of Scotland plc and Greenwich Capital Markets Inc. and $10 million in the aggregate to Credit Suisse International in respect of their exposure under the Auction Swaps; and 
 (o) within 8 business days of execution of this Agreement, to reduce TMA’s Payment Obligations to Citigroup Global Markets Limited by
at least $500 million, but in no event at a cost to TMA of more than $10 million during the Override Period. 
 SECTION 4. Representation
of TMA. TMA represents that its total exposure under Financing Agreements to persons other than the Counterparties is as set forth on Schedule V and that it has no exposure under any repurchase agreements, securities lending agreements or
Auction Swaps, except as set forth on Schedule V and except for the exposure to the Counterparties. 
 SECTION 5. Further
Negotiations. Each of the Counterparties, severally, and TMA agree to pursue in good faith negotiations toward execution and delivery of mutually acceptable agreements as provided in Sections 2(i) and 3(d) (which agreements shall provide for the
payment of reasonable fees to any entity acting as a collateral agent, securities intermediary or similar agent). 
 SECTION 6.
Disclosure. Upon execution of this Agreement by the Counterparties, TMA may disclose the substance of this agreement by press release and via the filing of a current report on Form 8-K with the SEC. 
 SECTION 7. Successors. The terms of this Agreement shall be binding upon, and shall inure to the benefit of, the parties hereto and their
respective corporate successors, assigns, and representatives, provided that (x) TMA may not assign or otherwise transfer any of its rights or obligations hereunder or under any Financing Agreement without the prior written consent of
each affected Counterparty and (y) a Counterparty may not assign or otherwise transfer any of its rights or obligations hereunder or under any Financing Agreement except (i) to an Eligible Assignee, (ii) by way of participation,
or (iii) by way of pledge or assignment of a security interest (provided that no such pledge or assignment shall release the Counterparty from any of its obligations hereunder or thereunder or substitute any such pledgee or assignee for
the Counterparty as a party hereto or thereto (and any other attempted assignment or transfer by any party hereto shall be null and void). For purposes of this Section, “Eligible Assignee” means (a) an affiliate of the
Counterparty; and (b) any other person (other than a natural person) approved by TMA (such approval not to be unreasonably withheld or delayed); provided that no such approval shall be required if an Override Termination Event has
occurred and is continuing. 
  

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 SECTION 8. Governing Law; Consent to Jurisdiction; Waiver of Jury Trial. This Agreement shall be
construed in accordance with the laws of the State of New York without regard to any principles of conflict of laws (other than New York General Obligations Law §5-1401). TMA and each Counterparty each hereby agrees that any LEGAL ACTION OR
PROCEEDING AGAINST IT WITH RESPECT TO THIS AGREEMENT, OR ANY OF THE AGREEMENTS, DOCUMENTS OR INSTRUMENTS DELIVERED IN CONNECTION WITH THIS AGREEMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES OF AMERICA SITTING IN
THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK, and, by execution and delivery hereof, each of TMA and each Counterparty accepts and consents to, for itself and in respect to its property, generally and unconditionally, the jurisdiction of the
aforesaid courts with respect to any action or proceeding brought by TMA and/or each Counterparty. 
 TMA AND EACH COUNTERPARTY HEREBY
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY AND ALL RIGHTS EACH MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED ON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT, OR ANY OTHER DOCUMENTS AND INSTRUMENTS
EXECUTED IN CONNECTION HEREWITH, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN), OR ACTIONS OF TMA OR ANY COUNTERPARTY. THIS PROVISION IS A MATERIAL INDUCEMENT FOR EACH COUNTERPARTY TO ENTER INTO THIS AGREEMENT.

 SECTION 9. Severability of Provisions. If any one or more of the covenants, agreements, provisions or terms of this Agreement shall
be held invalid for any reason whatsoever, then such covenants, agreements, provisions or terms shall be deemed severable from the remaining covenants, agreements, provisions or terms of this Agreement and shall in no way affect the facility or
enforceability of the other covenants, agreements, provisions or terms of this Agreement. 
 SECTION 10. Counterparts; Effectiveness.
This Agreement may be executed in several counterparts and by each party on a separate counterpart, each of which when so executed and delivered shall be an original, and all of which together shall constitute one instrument. Signatures transmitted
electronically (including by fax or e-mail) shall have the same legal effect as the originals, but each party nevertheless shall upon request of any other party deliver original signed counterparts of this Agreement to each other party (with the
failure to so deliver not effecting the enforceability of this Agreement as to such non-delivering party). This Agreement shall be effective as to each party on the date of delivery of such party’s executed counterpart; provided that the term
“execution date of this Agreement” shall refer to the date on which all parties have delivered counterparts, and any counterpart delivered prior to March 18, 2008 shall cease to be effective unless the execution date of this
Agreement has occurred on or before March 18, 2008. 
 SECTION 11. Complete Agreement. This Agreement expresses the entire
understanding of the parties with respect to the transactions contemplated hereby. No prior negotiations or discussions shall limit, modify, or otherwise affect the provisions hereof. 
  

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 SECTION 12. No Waiver. Except as expressly set forth in this Agreement, none of the Counterparties
shall be deemed to have waived any right under any Financing Agreement or at law or at equity provided, by entering into this Agreement. Each Counterparty’s agreement to extend the Repurchase Date or make any other accommodation hereunder on
one occasion shall in no event constitute its agreement to extend the Repurchase Date or make any other accommodation hereunder on any other occasion. 
 SECTION 13. Further Assurances. At any time and from time to time upon prior written request of Counterparty, at the sole expense of TMA, TMA will promptly and duly execute and deliver, or cause to be duly
executed and delivered, such further instruments and documents and take, or cause to be taken, such further actions, as each Counterparty may reasonably request for the purposes of obtaining or preserving the full benefits of this Agreement and the
other Financing Agreements. 
 SECTION 14. Other Provisions Remain in Effect. Except as overridden, suspended or superseded
hereby, the terms of each Financing Agreement, are and shall continue to be in full force and effect and are in all respects ratified and confirmed, and this Agreement is expressly made supplemental to and a part thereof. TMA hereby affirms and
ratifies each obligation and other similar liability to the Counterparties to which it is a party as of the date hereof (including, without limitation, obligations and liabilities which do not arise under Financing Agreements) and, except as
provided for in this Agreement during the Override Period, all such obligations and other liabilities shall continue in full force and effect unless and until released or discharged pursuant to this Agreement or otherwise. After the Override Period,
the Counterparties shall be entitled to exercise all of their rights and remedies under the Financing Agreements as in effect without regard to this Agreement, and neither this Agreement nor any delay in the exercise of any right or remedy pursuant
hereto shall constitute a waiver of any such right or remedy or provide any defense or estoppel in respect thereof, all such rights and remedies being expressly preserved hereby. 
 SECTION 15. Expenses. TMA agrees to pay or reimburse the Counterparties for all of their reasonable out-of-pocket costs and expenses in connection
with the negotiation, preparation, execution, delivery and enforcement of this Agreement and the agreements referred to herein, including, without limitation, the fees and expenses of Davis Polk & Wardwell, special counsel to the
Counterparties. 
 SECTION 16. Intent. The parties recognize that each of the Financing Agreements that is a Master Repurchase
Agreement is a “repurchase agreement” as that term is defined in Section 101 of Title 11 of the United States Code, as amended, that each of the Financing Agreements that is an ISDA Master Agreement is a “swap agreement” as
that term is defined in Section 101 of Title 11 of the United States Code, as amended, and that each of the Financing Agreements that is a Global Master Securities Lending Agreement is a “securities contract” as that term is defined
in Section 741(7) of Title 11 of the United States Code, as amended. 
 SECTION 17. Certain Definitions. 
 (a) Pro rata: Unless expressly stated in this Agreement or unless the context requires otherwise, the term “pro rata”
shall mean pro rata among the relevant Counterparties on the basis of the outstanding Payment Obligations of TMA to such Counterparties at the relevant time for the calculation. 
  

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 (b) Change in Control: The term “Change in Control” means the occurrence
of one or more of the following events: 
 (i) any sale, lease, exchange or other transfer (in one transaction or a series of
related transactions) of all or substantially all of the assets of TMA to any person or group of related persons for purposes of Section 13(d) of the Exchange Act (a “Group”), together with any affiliates thereof; 

(ii) any person or Group shall become the owner, directly or indirectly, beneficially or of record, of shares representing more than
50% of the aggregate ordinary voting power represented by the issued and outstanding Capital Stock of TMI; 
 (iii) approval
by the holders of Capital Stock of TMI of any plan or proposal for the liquidation or dissolution of TMA; or 
 (iv) the
replacement of a majority of the Board of Directors of TMI over a two-year period from the directors who constituted the Board of Directors of TMI at the beginning of such period, and such replacement shall not have been approved by a vote of at
least a majority of the Board of Directors of TMI then still in office who either were members of such Board of Directors at the beginning of such period or whose election as a member of such Board of Directors was previously so approved.

 (c) Business Day. As used in this Agreement, “business day” shall mean a day other than (i) a
Saturday or Sunday, or (ii) a day on which the New York Stock Exchange or banking or savings and loan institutions are authorized or obligated by law or executive order to be closed in the State of New York or the State of New Mexico or any
state in which the Interim Servicer operates. 
 SECTION 18. Amendments; Notices. Any amendment to, or waiver of, any term or
condition of this Agreement shall require the consent of TMI, TMHS and each of the Counterparties. All notices and other communications provided for or permitted hereunder (including amendments, waivers and consents) shall be in writing (including
facsimile transmission and electronic mail transmission) and shall be sent: 
 (a) If to TMA, to: 150 Washington Avenue, Suite
302, Santa Fe, New Mexico 87501, fax: fax, email: email or at such other address as shall be designated by TMA in a notice to the Counterparties; each of TMI and TMHS agreeing that notice to any one of them shall constitute sufficient notice to both
of them. 
 (b) If to any Counterparty, to it at such address as shall have been designated by it in a notice to TMA and the
other Counterparties. 
  

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 All such other notices and communications shall be deemed received on the date of receipt if received prior to 5 p.m.
(local time in the location of the addressee) on a business day. Otherwise, all such notices and other communications shall be deemed received on the next succeeding business day. 
 SECTION 19. Reliance on Agreements of Counterparties. Each Counterparty (an “authorizing Counterparty”) acknowledges and agrees that in
entering into this Agreement each other Counterparty is relying on the authorizing Counterparty’s covenants and agreements in this Agreement, and each authorizing Counterparty expressly authorizes each other Counterparty to do so.

 [SIGNATURE PAGES FOLLOW] 
  

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 IN WITNESS WHEREOF, the parties hereto have duly executed and delivered this Agreement, all as of the day
and year first above written. 
  

			
	THORNBURG MORTGAGE INC.
		
	By:	 	 /s/ Larry A. Goldstone

	Name:	 	Larry A. Goldstone
	Title:	 	President and Chief Executive Officer
	
	With respect to Section 2(i) (next-to-last sentence) only:
	
	THORNBURG MORTGAGE ADVISORY CORPORATION
		
	By:	 	 /s/ Larry A. Goldstone

	Name:	 	Larry A. Goldstone
	Title:	 	Managing Director
	
	THORNBURG MORTGAGE HEDGING STRATEGIES, INC.
		
	By:	 	 /s/ Larry A. Goldstone

	Name:	 	Larry A. Goldstone
	Title:	 	

 [TMA signature page] 

			
	GREENWICH CAPITAL MARKETS, INC.
		
	By:	 	 /s/ Ronald A. Weibye

	Name:	 	Ronald A. Weibye
	Title:	 	Managing Director

			
	 ROYAL BANK OF SCOTLAND PLC acting through its agent
 GREENWICH CAPITAL MARKETS, INC.

		
	By:	 	 /s/ Ronald A. Weibye

	Name:	 	Ronald A. Weibye
	Title:	 	Managing Director

			
	GREENWICH CAPITAL DERIVATIVES INC. acting through its agent
	GREENWICH CAPITAL MARKETS, INC.
		
	By:	 	 /s/ Ronald A. Weibye

	Name:	 	Ronald A. Weibye
	Title:	 	Managing Director

			
	BEAR STEARNS INVESTMENT PRODUCTS INC.
		
	By:	 	 /s/ Paul M. Friedman

	Name:	 	Paul M. Friedman
	Title:	 	Authorised Signatory

			
	 CITIGROUP GLOBAL MARKETS LIMITED acting through its intermediating agent
 CITIGROUP GLOBAL MARKETS INC.

		
	By:	 	 /s/ Sanjay Reddy

	Name:	 	Sanjay V. Reddy
	Title:	 	Managing Director

			
	CREDIT SUISSE SECURITIES (USA) LLC
		
	By:	 	 /s/ Suanne Dunne

	Name:	 	Suanne Dunne
	Title:	 	Director

			
	UBS SECURITIES LLC
		
	By:	 	 /s/ Larry Cofsky

	Name:	 	Larry Cofsky
	Title:	 	Managing Director
		
	By:	 	 /s/ Joseph Ilardi

	Name:	 	Joseph Ilardi
	Title:	 	Director

			
	CREDIT SUISSE INTERNATIONAL
		
	By:	 	 /s/ Suanne Dunne

	Name:	 	Suanne Dunne
	Title:	 	Authorized Signatory
		
	By:	 	 /s/ Barry Dixon

	Name:	 	Barry Dixon
	Title:	 	Authorized SignatoryWarrant Agreement

 Exhibit 4.3* 
 THIS WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED OR ANY STATE SECURITIES LAWS. NO SALE OR
DISPOSITION MAY BE EFFECTED WITHOUT (i) EFFECTIVE REGISTRATION STATEMENTS RELATED THERETO, (ii) AN OPINION OF COUNSEL OR OTHER EVIDENCE, REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATIONS ARE NOT REQUIRED, (iii) RECEIPT OF
NO-ACTION LETTERS FROM THE APPROPRIATE GOVERNMENTAL AUTHORITIES, OR (iv) OTHERWISE COMPLYING WITH THE PROVISIONS OF SECTION 7 OF THIS WARRANT. 
 TOLERION, INC. 
 WARRANT TO PURCHASE 45,000 SHARES 
 OF SERIES A PREFERRED STOCK 
 THIS CERTIFIES THAT, for value received, GATX VENTURES,
INC. and its assignees are entitled to subscribe for and purchase 45,000 shares of the fully paid and nonassessable Series A Preferred Stock (as adjusted pursuant to Section 4 hereof, the “Shares”) of TOLERION, INC., a
Delaware corporation (the “Company”), at the price of $1.00 per share (such price and such other price as shall result, from time to time, from the adjustments specified in Section 4 hereof is herein referred to as the
“Warrant Price”), subject to the provisions and upon the terms and conditions hereinafter set forth. As used herein, (a) the term “Series Preferred” shall mean the Company’s presently authorized Series A
Preferred Stock, and any stock into or for which such Series A Preferred Stock may hereafter be converted or exchanged, and after the automatic conversion of the Series A Preferred Stock to Common Stock shall mean the Company’s Common Stock,
(b) the term “Date of Grant” shall mean October 31, 2002, and (c) the term “Other Warrants” shall mean any other warrants issued by the Company in connection with the transaction with respect to which
this Warrant was issued, and any warrant issued upon transfer or partial exercise of or in lieu of this Warrant. The term “Warrant” as used herein shall be deemed to include Other Warrants unless the context clearly requires
otherwise. 
 1. Term. The purchase right represented by this Warrant is exercisable, in whole or in part, at any time and from time
to time from the Date of Grant through the later of (i) ten (10) years after the Date of Grant or (ii) five (5) years after the closing of the Company’s initial public offering of its Common Stock (“IPO”)
effected pursuant to a Registration Statement on Form S-l (or its successor) filed under the Securities Act of 1933, as amended (the “Act”). 
 2. Method of Exercise; Payment; Issuance of New Warrant. Subject to Section 1 hereof, the purchase right represented by this Warrant may be exercised by the holder hereof, in whole or in part and
from time to time, at the election of the holder hereof, by (a) the surrender of this Warrant (with the notice of exercise substantially in the form attached hereto as Exhibit A-l duly completed and executed) at the principal office of
the Company and by the payment to the Company, by certified or bank check, or by wire transfer to an account designated by the Company (a “Wire Transfer”) of an amount equal to the then applicable Warrant Price multiplied by the
number of Shares then being purchased; (b) if in connection with a registered public offering of the Company’s 
  

	*	The Registrant is re-filing Exhibit 4.3 to the Registrant’s Form S-1 originally filed on January 9, 2008 to include all exhibits, schedules and appendices to this agreement.
The Registrant has made no other changes to the previously filed agreement. 

 
securities, the surrender of this Warrant (with the notice of exercise form attached hereto as Exhibit A-2 duly completed and executed) at the
principal office of the Company together with notice of arrangements reasonably satisfactory to the Company for payment to the Company either by certified or bank check or by Wire Transfer from the proceeds of the sale of shares to be sold by the
holder in such public offering of an amount equal to the then applicable Warrant Price per share multiplied by the number of Shares then being purchased; or (c) exercise of the “net issuance” right provided for in
Section 10.2 hereof. The person or persons in whose name(s) any certificate(s) representing shares of Series Preferred shall be issuable upon exercise of this Warrant shall be deemed to have become the holder(s) of record of, and shall
be treated for all purposes as the record holder(s) of, the shares represented thereby (and such shares shall be deemed to have been issued) immediately prior to the close of business on the date or dates upon which this Warrant is exercised. In the
event of any exercise of the rights represented by this Warrant, certificates for the shares of stock so purchased shall be delivered to the holder hereof as soon as possible and in any event within thirty (30) days after such exercise and,
unless this Warrant has been fully exercised or expired, a new Warrant representing the portion of the Shares, if any, with respect to which this Warrant shall not then have been exercised shall also be issued to the holder hereof as soon as
possible and in any event within such thirty-day period; provided that at such time as the Company is subject to the reporting requirements of the Securities Exchange Act of 1934, as amended, if requested by the holder of this Warrant,
the Company shall cause its transfer agent to deliver the certificate representing Shares issued upon exercise of this Warrant to a broker or other person (as directed by the holder exercising this Warrant) within the time period required to settle
any trade made by the holder after exercise of this Warrant. 
 3. Stock Fully Paid; Reservation of Shares. All Shares that may be
issued upon the exercise of the rights represented by this Warrant will, upon issuance pursuant to the terms and conditions herein, be fully paid and nonassessable, and free from all preemptive rights and taxes, liens and charges with respect to the
issue thereof. During the period within which the rights represented by this Warrant may be exercised, the Company will at all times have authorized, and reserved for the purpose of the issue upon exercise of the purchase rights evidenced by this
Warrant, a sufficient number of shares of its Series Preferred to provide for the exercise of the rights represented by this Warrant and a sufficient number of shares of its Common Stock to provide for the conversion of the Series Preferred into
Common Stock. 
 4. Adjustment of Warrant Price and Number of Shares. The number and kind of securities purchasable upon the exercise
of this Warrant and the Warrant Price shall be subject to adjustment from time to time upon the occurrence of certain events, as follows: 
 (a) Reclassification or Merger. In case of any reclassification or change of securities of the class issuable upon exercise of this Warrant (other than a change in par value, or from par value to no par value, or from no par value to
par value, or as a result of a subdivision or combination), or in case of any merger of the Company with or into another corporation (other than a merger with another corporation in which the Company is the acquiring and the surviving corporation
and which does not result in any reclassification or change of outstanding securities issuable upon exercise of this Warrant), or in case of any sale of all or substantially all of the assets of the Company, the Company, or such successor or
purchasing corporation, as the case may be, 

  

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shall duly execute and deliver to the holder of this Warrant a new Warrant (in form and substance satisfactory to the holder of this Warrant), or the Company
shall make appropriate provision without the issuance of a new Warrant, so that the holder of this Warrant shall have the right to receive upon exercise of this Warrant, at a total purchase price not to exceed that payable upon the exercise of the
unexercised portion of this Warrant, and in lieu of the shares of Series Preferred theretofore issuable upon exercise of this Warrant, (i) the kind and amount of shares of stock, other securities, money and property receivable upon such
reclassification, change, merger or sale by a holder of the number of shares of Series Preferred then purchasable under this Warrant, or (ii) in the case of such a merger or sale in which the consideration paid consists all or in part of assets
other than securities of the successor or purchasing corporation, at the option of the holder of this Warrant, the securities of the successor or purchasing corporation having a value at the time of the transaction equivalent to the value of the
Series Preferred purchasable upon exercise of this Warrant at the time of the transaction. Any new Warrant shall provide for adjustments that shall be as nearly equivalent as may be practicable to the adjustments provided for in this
Section 4. The provisions of this Section 4(a) shall similarly apply to successive reclassifications, changes, mergers and sales. 
 (b) Subdivision or Combination of Shares. If the Company at any time while this Warrant remains outstanding and unexpired shall subdivide or combine its outstanding shares of Series Preferred, the Warrant Price
shall be proportionately decreased and the number of Shares issuable hereunder shall be proportionately increased in the case of a subdivision and the Warrant Price shall be proportionately increased and the number of Shares issuable hereunder shall
be proportionately decreased in the case of a combination. 
 (c) Stock Dividends and Other Distributions. If the Company at any time
while this Warrant is outstanding and unexpired shall (i) pay a dividend with respect to Series Preferred payable in Series Preferred, then the Warrant Price shall be adjusted, from and after the date of determination of shareholders entitled
to receive such dividend or distribution, to that price determined by multiplying the Warrant Price in effect immediately prior to such date of determination by a fraction (A) the numerator of which shall be the total number of shares of Series
Preferred outstanding immediately prior to such dividend or distribution, and (B) the denominator of which shall be the total number of shares of Series Preferred outstanding immediately after such dividend or distribution; or (ii) make
any other distribution with respect to Series Preferred (except any distribution specifically provided for in Sections 4(a) and 4(b)), then, in each such case, provision shall be made by the Company such that the holder of this Warrant shall
receive upon exercise of this Warrant a proportionate share of any such dividend or distribution as though it were the holder of the Series Preferred (or Common Stock issuable upon conversion thereof) as of the record date fixed for the
determination of the shareholders of the Company entitled to receive such dividend or distribution. 
 (d) Adjustment of Number of
Shares. Upon each adjustment in the Warrant Price, the number of Shares of Series Preferred purchasable hereunder shall be adjusted, to the nearest whole share, to the product obtained by multiplying the number of Shares purchasable immediately
prior to such adjustment in the Warrant Price by a fraction, the numerator of which shall be the Warrant Price immediately prior to such adjustment and the denominator of which shall be the Warrant Price immediately thereafter. 
  

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 (e) Antidilution Rights. The other antidilution rights applicable to the Shares of Series
Preferred purchasable hereunder are set forth in the Company’s Certificate of Incorporation, as amended through the Date of Grant, a true and complete copy of which is attached hereto as Exhibit B (the “Charter”). Such
antidilution rights shall not be restated, amended, modified or waived in any manner that is adverse to the holder hereof without such holder’s prior written consent unless such restatement, amendment, modification or waiver affects the holder
in the same manner as it affects all other holders of Series Preferred. The Company shall promptly provide the holder hereof with any restatement, amendment, modification or waiver of the Charter promptly after the same has been made. 
 5. Notice of Adjustments. Whenever the Warrant Price or the number of Shares purchasable hereunder shall be adjusted pursuant to
Section 4 hereof, the Company provide written notice to the holder setting forth, in reasonable detail, the event requiring the adjustment, the amount of the adjustment, the method by which such adjustment was calculated, and the Warrant
Price and the number of Shares purchasable hereunder after giving effect to such adjustment, and shall cause copies of such certificate to be mailed (without regard to Section 13 hereof, by first class mail, postage prepaid) to the
holder of this Warrant. In addition, whenever the conversion price or conversion ratio of the Series Preferred shall be adjusted, the Company shall provide written notice to the holder setting forth, in reasonable detail, the event requiring the
adjustment, the amount of the adjustment, the method by which such adjustment was calculated, and the conversion price or ratio of the Series Preferred after giving effect to such adjustment, and shall cause copies of such certificate to be mailed
(without regard to Section 13 hereof, by first class mail, postage prepaid) to the holder of this Warrant. 
 6. Fractional
Shares. No fractional shares of Series Preferred will be issued in connection with any exercise hereunder, but in lieu of such fractional shares the Company shall make a cash payment therefor based on the fair market value of the Series
Preferred on the date of exercise as reasonably determined in good faith by the Company’s Board of Directors. 
 7. Compliance with
Act; Disposition of Warrant or Shares of Series Preferred. 
 (a) Compliance with Act. The holder of this Warrant, by acceptance
hereof, agrees that this Warrant, and the shares of Series Preferred to be issued upon exercise hereof and any Common Stock issued upon conversion thereof are being acquired for investment and that such holder will not offer, sell or otherwise
dispose of this Warrant, or any shares of Series Preferred to be issued upon exercise hereof or any Common Stock issued upon conversion thereof except under circumstances which will not result in a violation of the Act or any applicable state
securities laws. Upon exercise of this Warrant, unless the Shares being acquired are registered under the Act and any applicable state securities laws or an exemption from such registration is available, the holder hereof shall confirm in writing
that the shares of Series Preferred so purchased (and any shares of Common Stock issued upon conversion thereof) are being acquired for investment and not with a view toward distribution or resale in violation of the Act and shall confirm such other
matters related thereto as may be reasonably requested by the Company. This Warrant and all shares of Series Preferred issued upon exercise of this Warrant and all shares of Common Stock issued upon conversion thereof (unless registered under the
Act and any applicable state securities laws) shall be stamped or imprinted with a legend in substantially the following form: 
  

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 “THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE
SECURITIES LAWS. NO SALE OR DISPOSITION MAY BE EFFECTED WITHOUT (i) EFFECTIVE REGISTRATION STATEMENTS RELATED THERETO, (ii) AN OPINION OF COUNSEL OR OTHER EVIDENCE, REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATIONS ARE NOT
REQUIRED, (iii) RECEIPT OF NO-ACTION LETTERS FROM THE APPROPRIATE GOVERNMENTAL AUTHORITIES, OR (iv) OTHERWISE COMPLYING WITH THE PROVISIONS OF SECTION 7 OF THE WARRANT UNDER WHICH THESE SECURITIES WERE ISSUED, DIRECTLY OR INDIRECTLY.”

 Said legend shall be removed by the Company, upon the request of a holder, at such time as the restrictions on the transfer of the
applicable security shall have terminated. In addition, in connection with the issuance of this Warrant, the holder specifically represents to the Company by acceptance of this Warrant as follows: 
 (1) The holder is aware of the Company’s business affairs and financial condition, and has acquired information about the Company sufficient to
reach an informed and knowledgeable decision to acquire this Warrant. The holder is acquiring this Warrant for its own account for investment purposes only and not with a view to, or for the resale in connection with, any “distribution”
thereof in violation of the Act. 
 (2) The holder understands that this Warrant has not been registered under the Act in reliance upon a
specific exemption therefrom, which exemption depends upon, among other things, the bona fide nature of the holder’s investment intent as expressed herein. 
 (3) The holder further understands that this Warrant must be held indefinitely unless subsequently registered under the Act and qualified under any applicable state securities laws, or unless exemptions from
registration and qualification are otherwise available. The holder is aware of the provisions of Rule 144, promulgated under the Act. 
 (4)
The holder is an “accredited investor” as such term is defined in Rule 501 of Regulation D promulgated under the Act. 
 (b)
Disposition of Warrant or Shares. With respect to any offer, sale or other disposition of this Warrant or any shares of Series Preferred acquired pursuant to the exercise of this Warrant prior to registration of such Warrant or shares, the
holder hereof agrees to give written notice to the Company prior thereto, describing briefly the manner thereof, together with a written opinion of such holder’s counsel, or other evidence, if reasonably satisfactory to the Company, to the
effect that such offer, sale or other disposition may be effected without registration or qualification (under the Act as then in effect or any federal or state securities law then in effect) of this Warrant or such shares of Series Preferred or
Common Stock and indicating whether or not under the Act certificates for this Warrant or such shares of Series Preferred to be sold or otherwise disposed of 

  

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require any restrictive legend as to applicable restrictions on transferability in order to ensure compliance with such law. Upon receiving such written
notice and reasonably satisfactory opinion or other evidence, the Company, as promptly as practicable but no later than fifteen (15) days after receipt of the written notice, shall notify such holder that such holder may sell or otherwise
dispose of this Warrant or such shares of Series Preferred or Common Stock, all in accordance with the terms of the notice delivered to the Company. If a determination has been made pursuant to this Section 7(b) that the opinion of
counsel for the holder or other evidence is not reasonably satisfactory to the Company, the Company shall so notify the holder promptly with details thereof after such determination has been made. Notwithstanding the foregoing, this Warrant or such
shares of Series Preferred or Common Stock may, as to such federal laws, be offered, sold or otherwise disposed of in accordance with Rule 144 or 144A under the Act, provided that the Company shall have been furnished with such information as the
Company may reasonably request to provide a reasonable assurance that the provisions of Rule 144 or 144A have been satisfied. Each certificate representing this Warrant or the shares of Series Preferred thus transferred (except a transfer pursuant
to Rule 144 or 144A) shall bear a legend as to the applicable restrictions on transferability in order to ensure compliance with such laws, unless in the aforesaid opinion of counsel for the holder, such legend is not required in order to ensure
compliance with such laws. The Company may issue stop transfer instructions to its transfer agent in connection with such restrictions. 
 (c) Applicability of Restrictions. Neither any restrictions of any legend described in this Warrant nor the requirements of Section 7(b) above shall apply to any transfer of, or grant of a security interest in, this
Warrant (or the Series Preferred or Common Stock obtainable upon exercise hereof or thereof) or any part hereof (i) to a partner of the holder if the holder is a partnership or to a member of the holder if the holder is a limited liability
company, (ii) to a partnership of which the holder is a partner or to a limited liability company of which the holder is a member, or (iii) to any affiliate of the holder if the holder is a corporation; provided that in any
such transfer, if applicable, the transferee shall on the Company’s request agree in writing to be bound by the terms of this Warrant as if an original holder hereof. 
 8. Rights as Shareholders; Information. No holder of this Warrant, as such, shall be entitled to vote or receive dividends or be deemed the holder
of Series Preferred or any other securities of the Company which may at any time be issuable upon the exercise hereof for any purpose, nor shall anything contained herein be construed to confer upon the holder of this Warrant, as such, any of the
rights of a shareholder of the Company or any right to vote for the election of directors or upon any matter submitted to shareholders at any meeting thereof, or to receive notice of meetings, or to receive dividends or subscription rights or
otherwise until this Warrant shall have been exercised and the Shares purchasable upon the exercise hereof shall have become deliverable, as provided herein. Notwithstanding the foregoing, the Company will transmit to the holder of this Warrant such
statements and notices sent to or made available generally by the Company to the holders of Series Preferred concurrently with the distribution thereof to such holders. 
 9. Registration Rights. The holder of this Warrant is hereby granted the rights, and assumes the obligations imposed, pursuant to Section 1 of that certain Amended and Restated Investor Rights Agreement
dated as of July 31, 2002, by and among the Company and the investors named therein (the “Rights Agreement”), as if the holder of this Warrant were a “Holder” as such 

  

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term is defined in the Rights Agreement and as if the Series Preferred issuable upon exercise of this Warrant were shares of “Preferred Stock” as
such term is defined in the Rights Agreement; provided that: 
 (1) The holder of this Warrant may include its Registrable
Securities (as defined in the Rights Agreement) in any registration filed under Section 1.2 of the Rights Agreement only to the extent that the inclusion of its securities will not reduce the amount of Registrable Securities of the other
Holders to be included therein; 
 (2) The holder of this Warrant may demand registration pursuant to Section 1 of the Rights Agreement
only if such registration could not result in such registration statement being declared effective prior to the earlier of either the dates set forth in Section 1.2(a) of the Rights Agreement or within 120 days after the effective date of any
registration effected pursuant to Section 1.2 of the Rights Agreement; and 
 (3) The registration rights granted to the holder of this
Warrant are assignable by the holder as set forth in Section 1.11 of the Rights Agreement except that the requirement that an assignee receive from a transferring Holder at least 100,000 Registrable Securities shall not apply. With respect to
all of the securities covered by the registration rights granted to the holder of this Warrant, if there shall at any time be more than one holder entitled to such rights, all such holders shall have a single attorney-in-fact for purposes of
exercising any rights, receiving any notices or taking any action under Section 1 of the Rights Agreement. 
 10. Additional
Rights. 
 10.1 Acquisition Transactions. The Company shall provide the holder of this Warrant with at least twenty
(20) days’ written notice prior to closing thereof of the terms and conditions of any of the following transactions (to the extent the Company has notice thereof): (i) the sale, lease, exchange, conveyance or other disposition of all
or substantially all of the Company’s property or business, or (ii) its merger into or consolidation with any other corporation (other than a wholly-owned subsidiary of the Company), or any transaction (including a merger or other
reorganization) or series of related transactions, in which more than fifty percent (50%) of the voting power of the Company is disposed of. 
 10.2 Right to Convert Warrant into Stock: Net Issuance. 
 (a) Right to Convert. In addition to and without limiting
the rights of the holder under the terms of this Warrant, the holder shall have the right to convert this Warrant or any portion thereof (the “Conversion Right”) into shares of Series Preferred as provided in this
Section 10.2 at any time or from time to time during the term of this Warrant. Upon exercise of the Conversion Right with respect to a particular number of shares subject to this Warrant (the “Converted Warrant Shares”),
the Company shall deliver to the holder (without payment by the holder of any exercise price or any cash or other consideration) that number of shares of fully paid and nonassessable Series Preferred as is determined according to the following
formula: 
  

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	X =	 	   B - A  
	  		  		  		  		  		  		  		  	
		 	Y	  		  		  		  		  		  		  		  	

  

					
	Where:	  	X =	  	the number of shares of Series Preferred that shall be issued to holder
			
		  	Y =	  	the fair market value of one share of Series Preferred
			
		  	A =	  	the aggregate Warrant Price of the specified number of Converted Warrant Shares immediately prior to the exercise of the Conversion Right (i.e., the number of Converted Warrant Shares
multiplied by the Warrant Price)
			
		  	B =	  	the aggregate fair market value of the specified number of Converted Warrant Shares (i.e., the number of Converted Warrant Shares multiplied by the fair market value of one
Converted Warrant Share)

 No fractional shares shall be issuable upon exercise of the Conversion Right, and, if the number
of shares to be issued determined in accordance with the foregoing formula is other than a whole number, the Company shall pay to the holder an amount in cash equal to the fair market value of the resulting fractional share on the Conversion Date
(as hereinafter defined). For purposes of Section 10 of this Warrant, shares issued pursuant to the Conversion Right shall be treated as if they were issued upon the exercise of this Warrant. 
 (b) Method of Exercise. The Conversion Right may be exercised by the holder by the surrender of this Warrant at the principal office of the
Company together with a written statement (which may be in the form of Exhibit A-l or Exhibit A-2 hereto) specifying that the holder thereby intends to exercise the Conversion Right and indicating the number of shares subject to this
Warrant which are being surrendered (referred to in Section 10.2(a) hereof as the Converted Warrant Shares) in exercise of the Conversion Right. Such conversion shall be effective upon receipt by the Company of this Warrant together with
the aforesaid written statement, or on such later date as is specified therein (the “Conversion Date”), and, at the election of the holder hereof, may be made contingent upon the closing of the sale of the Company’s Common
Stock to the public in a public offering pursuant to a Registration Statement under the Act (a “Public Offering”). Certificates for the shares issuable upon exercise of the Conversion Right and, if applicable, a new warrant
evidencing the balance of the shares remaining subject to this Warrant, shall be issued as of the Conversion Date and shall be delivered to the holder within thirty (30) days following the Conversion Date. 
 (c) Determination of Fair Market Value. For purposes of this Section 10.2, “fair market value” of a share of Series
Preferred (or Common Stock if the Series Preferred has been automatically converted into Common Stock) as of a particular date (the “Determination Date”) shall mean: 
 (i) If the Conversion Right is exercised in connection with and contingent upon a Public Offering, and if the Company’s Registration Statement
relating to such Public 

  

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Offering (“Registration Statement”) has been declared effective by the Securities and Exchange Commission, then the initial “Price to
Public” specified in the final prospectus with respect to such offering. 
 (ii) If the Conversion Right is not exercised in connection
with and contingent upon a Public Offering, then as follows: 
 (A) If traded on a securities exchange, the fair market value of the Common
Stock shall be deemed to be the average of the closing prices of the Common Stock on such exchange over the five trading days immediately prior to the Determination Date, and the fair market value of the Series Preferred shall be deemed to be such
fair market value of the Common Stock multiplied by the number of shares of Common Stock into which each share of Series Preferred is then convertible; 
 (B) If traded on the Nasdaq Stock Market or other over-the-counter system, the fair market value of the Common Stock shall be deemed to be the average of the closing bid prices of the Common Stock over the five
trading days immediately prior to the Determination Date, and the fair market value of the Series Preferred shall be deemed to be such fair market value of the Common Stock multiplied by the number of shares of Common Stock into which each share of
Series Preferred is then convertible; and 
 (C) If there is no public market for the Common Stock, then fair market value shall be
determined by mutual agreement of the holder of this Warrant and the Company. 
 In making a determination under clauses (A) or (B) above, if on
the Determination Date, five trading days had not passed since the IPO, then the fair market value of the Common Stock shall be the average closing prices or closing bid prices, as applicable, for the shorter period beginning on and including the
date of the IPO and ending on the trading day prior to the Determination Date (or if such period includes only one trading day the closing price or closing bid price, as applicable, for such trading day). If closing prices or closing bid prices are
no longer reported by a securities exchange or other trading system, the closing price or closing bid price shall be that which is reported by such securities exchange or other trading system at 4:00 p.m. New York City time on the applicable trading
day. 
 10.3 Exercise Prior to Expiration. To the extent this Warrant is not previously exercised as to all of the Shares subject
hereto, and if the fair market value of one share of the Series Preferred is greater than the Warrant Price then in effect, this Warrant shall be deemed automatically exercised pursuant to Section 10.2 above (even if not surrendered)
immediately before its expiration. For purposes of such automatic exercise, the fair market value of one share of the Series Preferred upon such expiration shall be determined pursuant to Section 10.2(c). To the extent this Warrant or
any portion thereof is deemed automatically exercised pursuant to this Section 10.3, the Company agrees to promptly notify the holder hereof of the number of Shares, if any, the holder hereof is to receive by reason of such automatic
exercise. 
 11. Representations and Warranties. The Company represents and warrants to the holder of this Warrant as follows:

 (a) This Warrant has been duly authorized and executed by the Company and is a valid and binding obligation of the Company enforceable in
accordance with its terms, subject to laws of general application relating to bankruptcy, insolvency and the relief of debtors and the rules of law or principles at equity governing specific performance, injunctive relief and other equitable
remedies. 
  

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 (b) The Shares have been duly authorized and reserved for issuance by the Company and, when issued in
accordance with the terms hereof, will be validly issued, fully paid and nonassessable and free from preemptive rights. 
 (c) The rights,
preferences, privileges and restrictions granted to or imposed upon the Series Preferred and the holders thereof are as set forth in the Charter, and on the Date of Grant, each share of the Series Preferred represented by this Warrant is convertible
into one share of Common Stock. 
 (d) The shares of Common Stock issuable upon conversion of the Shares have been duly authorized and
reserved for issuance by the Company and, when issued in accordance with the terms of the Charter will be validly issued, fully paid and nonassessable. 
 (e) The execution and delivery of this Warrant are not, and the issuance of the Shares upon exercise of this Warrant in accordance with the terms hereof will not be, inconsistent with the Company’s Charter or
by-laws, do not and will not contravene any law, governmental rule or regulation, judgment or order applicable to the Company, and do not and will not conflict with or contravene any provision of, or constitute a default under, any indenture,
mortgage, contract or other instrument of which the Company is a party or by which it is bound or require the consent or approval of, the giving of notice to, the registration or filing with or the taking of any action in respect of or by, any
Federal, state or local government authority or agency or other person, except for the filing of notices pursuant to federal and state securities laws, which filings will be effected by the time required thereby. 
 (f) There are no actions, suits, audits, investigations or proceedings pending or, to the knowledge of the Company, threatened against the Company in any
court or before any governmental commission, board or authority which, if adversely determined, could have a material adverse effect on the ability of the Company to perform its obligations under this Warrant. 
 (g) The number of shares of Common Stock of the Company outstanding on the date hereof, on a fully diluted basis (assuming the conversion of all
outstanding convertible securities and the exercise of all outstanding options and warrants), does not exceed 19,550,000 shares. 
 12.
Modification and Waiver. This Warrant and any provision hereof may be changed, waived, discharged or terminated only by an instrument in writing signed by the party against which enforcement of the same is sought. 
 13. Notices. Any notice, request, communication or other document required or permitted to be given or delivered to the holder hereof or the
Company shall be delivered, or shall be 

  

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sent by certified or registered mail, postage prepaid, to each such holder at its address as shown on the books of the Company or to the Company at the
address indicated therefor on the signature page of this Warrant. 
 14. Binding Effect on Successors. This Warrant shall be binding
upon any corporation succeeding the Company by merger, consolidation or acquisition of all or substantially all of the Company’s assets, and all of the obligations of the Company relating to the Series Preferred issuable upon the exercise or
conversion of this Warrant shall survive the exercise, conversion and termination of this Warrant and all of the covenants and agreements of the Company shall inure to the benefit of the successors and assigns of the holder hereof. 
 15. Lost Warrants or Stock Certificates. The Company covenants to the holder hereof that, upon receipt of evidence reasonably satisfactory to the
Company of the loss, theft, destruction or mutilation of this Warrant or any stock certificate and, in the case of any such loss, theft or destruction, upon receipt of an indemnity reasonably satisfactory to the Company, or in the case of any such
mutilation upon surrender and cancellation of such Warrant or stock certificate, the Company will make and deliver a new Warrant or stock certificate, of like tenor, in lieu of the lost, stolen, destroyed or mutilated Warrant or stock certificate.

 16. Descriptive Headings. The descriptive headings of the various Sections of this Warrant are inserted for convenience only and do
not constitute a part of this Warrant. The language in this Warrant shall be construed as to its fair meaning without regard to which party drafted this Warrant. 
 17. Governing Law. This Warrant shall be construed and enforced in accordance with, and the rights of the parties shall be governed by, the laws of the State of California. 
 18. Survival of Representations, Warranties and Agreements. All representations and warranties of the Company and the holder hereof contained
herein shall survive the Date of Grant, the exercise or conversion of this Warrant (or any part hereof) or the termination or expiration of rights hereunder. All agreements of the Company and the holder hereof contained herein shall survive
indefinitely until, by their respective terms, they are no longer operative. 
 19. Remedies. In case any one or more of the covenants
and agreements contained in this Warrant shall have been breached, the holders hereof (in the case of a breach by the Company), or the Company (in the case of a breach by a holder), may proceed to protect and enforce their or its rights either by
suit in equity and/or by action at law, including, but not limited to, an action for damages as a result of any such breach and/or an action for specific performance of any such covenant or agreement contained in this Warrant. 
 20. No Impairment of Rights. The Company will not, by amendment of its Charterer through any other means, avoid or seek to avoid the observance or
performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such action as may be necessary or appropriate in order to protect the rights of the holder of
this Warrant against impairment. 
  

 -11- 

 21. Severability. The invalidity or unenforceability of any provision of this Warrant in any
jurisdiction shall not affect the validity or enforceability of such provision in any other jurisdiction, or affect any other provision of this Warrant, which shall remain in full force and effect. 
 22. Recovery of Litigation Costs. If any legal action or other proceeding is brought for the enforcement of this Warrant, or because of an alleged
dispute, breach, default, or misrepresentation in connection with any of the provisions of this Warrant, the successful or prevailing party or parties shall be entitled to recover reasonable attorneys’ fees and other costs incurred in that
action or proceeding, in addition to any other relief to which it or they may be entitled. 
 23. Entire Agreement; Modification. This
Warrant constitutes the entire agreement between the parties pertaining to the subject matter contained in it and supersedes all prior and contemporaneous agreements, representations, and undertakings of the parties, whether oral or written, with
respect to such subject matter. 
 [Remainder of page intentionally left blank.] 
  

 -12- 

 The Company has caused this Warrant to be duly executed and delivered as of the Date of Grant specified
above. 
  

			
	TOLE RION, INC.
		
	By	 	 /s/ John P. Walker

	Title	 	Chairman – CEO
	Address:	 	 3430 West Bayshore Road
 Palo Alto, CA
94303

  

 -13- 

 EXHIBIT A-l 
 NOTICE OF EXERCISE 
 To: TOLERION. INC. (the “Company”) 
 1. The undersigned hereby: 
  

	 	 ̈	elects to purchase                      shares of [Series A Preferred
Stock] [Common Stock] of the Company pursuant to the terms of the attached Warrant, and tenders herewith payment of the purchase price of such shares in full, or 

  

	 	 ̈	elects to exercise its net issuance rights pursuant to Section 10.2 of the attached Warrant with respect to
                     Shares of [Series A Preferred Stock] [Common Stock]. 

 2. Please issue a certificate or certificates representing
                     shares in the name of the undersigned or in such other name or names as are specified below: 
  

	
	  

	(Name)
	
	  

	
	  

	(Address)

 3. The undersigned represents that the aforesaid shares are being acquired for the account of the
undersigned for investment and not with a view to, or for resale in connection with, the distribution thereof and that the undersigned has no present intention of distributing or reselling such shares, all except as in compliance with applicable
securities laws. 
  

	
	  

	(Signature)

  

			
	  
	 	
	(Date)	 	

 EXHIBIT A-2 
 NOTICE OF EXERCISE 
 To: TOLERION, INC. (the “Company”) 
 1. Contingent upon and effective immediately prior to the closing (the “Closing”) of the Company’s public offering contemplated by
the Registration Statement on Form S    , filed                     ,
        , the undersigned hereby: 
  ̈ elects to purchase
                     shares of [Series A Preferred Stock] [Common Stock] of the Company (or such lesser number of shares as may be sold on
behalf of the undersigned at the Closing) pursuant to the terms of the attached Warrant, or 
  ̈ elects to
exercise its net issuance rights pursuant to Section 10.2 of the attached Warrant with respect to                      Shares of
[Series A Preferred Stock] [Common Stock]. 
 2. Please deliver to the custodian for the selling shareholders a stock certificate
representing such                      shares. 
 3. The undersigned has instructed the custodian for the selling shareholders to deliver to the Company
$                     or, if less, the net proceeds due the undersigned from the sale of shares in the aforesaid public offering. If such net
proceeds are less than the purchase price for such shares, the undersigned agrees to deliver the difference to the Company prior to the Closing. 
  

	
	  

	(Signature)

  

			
	  
	 	
	(Date)	 	

 EXHIBIT B 
 CHARTER 

 

 
 I, HARRIET SMITH WINDSOR, SECRETARY OF STATE OF THE STATE OF DELAWARE, DO HEREBY CERTIFY THE ATTACHED IS A
TRUE AND CORRECT COPY OF THE CERTIFICATE OF CORRECTION OF “TOLERION, INC.”, FILED IN THIS OFFICE ON THE TWENTY-THIRD DAY OF OCTOBER, A.D. 2002, AT 9 O’CLOCK A.M. 
 A FILED COPY OF THIS CERTIFICATE HAS BEEN FORWARDED TO THE KENT COUNTY RECORDER OF DEEDS. 
  

					
		  	

	  	 /s/ Harriet Smith Windsor

		  	  	Harriet Smith Windsor, Secretary of State
	3313381 8100	  	  	AUTHENTICATION: 2052992
			
	020657230	  		  	DATE: 10-24-02

  

 PAGE 1 

					
		  		  	STATE OF DELAWARE
		  		  	SECRETARY OF STATE
		  		  	DIVISION OF CORPORATIONS
		  		  	FILED 09:00 AM 10/23/2002
		  		  	020657230 – 3313381

 CERTIFICATE OF CORRECTION 
 OF 
 RESTATED CERTIFICATE OF INCORPORATION 
 filed on 07/31/2002 
 OF

 TOLERION, INC. 
 Alan C. Mendelson, for and on behalf of Tolerion, Inc., a Delaware corporation (the “Company”), hereby certifies as follows: 
  

	 	1.	The name of the corporation is Tolerion, Inc. 

  

	 	2.	The original Certificate of Incorporation of the Company was filed with the Secretary of State of the State of Delaware on December 6, 2000 at which time the name of the
corporation was SunVax, Inc. 

  

	 	3.	A Certificate of Amendment of the Certificate of Incorporation of the Company was filed with the Secretary of State of the State of Delaware on April 5, 2002.

  

	 	4.	A Restated Certificate of Incorporation of the Company was filed with the Secretary of State of the State of Delaware on April 23, 2002. 

  

	 	5.	A Restated Certificate of Incorporation (the “Restated Certificate”) of the Company was filed with the Secretary of State of the State of Delaware on July 31,
2002, and said Restated Certificate requires correction as permitted by Section 103(f) of the General Corporation Law of the State of Delaware. 

  

	 	6.	The following language was erroneously included in ARTICLE IV, Section A of the Restated Certificate and should be, and hereby is, deleted because the “Reverse
Split” discussed therein was effected upon the filing of the Restated Certificate of Incorporation of the Company with the Secretary of State of the Slate of Delaware on April 23, 2002: 

 “Immediately upon the filing of this Certificate with the Secretary of State of the State of Delaware, each share of the Company’s Common Stock
outstanding immediately prior to such filing shall be automatically split to constitute 0.2366 of one share of the Company’s Common Stock. The split of outstanding shares of Common Stock effected by the foregoing sentence of this Section A
shall be referred to as the “Reverse Split.” 

 The Reverse Split shall occur without any further action on the part of the Company or the holder thereof
and whether or not certificates representing such holder’s shares prior to the Reverse Split are surrendered for cancellation. 
 No fractional interest in a share of Common Stock shall be deliverable upon the Reverse Split. All
shares of Common Stock (including fractions thereof) issuable upon the Reverse Split held by a holder prior to the Reverse Split shall be aggregated for purposes of determining whether the Reverse Split would result in the issuance of any fractional
share. Any fractional share resulting from such aggregation of Common Stock upon the Reverse Split shall be rounded down to the nearest whole share of Common Stock if such fractional share is less than  1/2 of one share and shall be rounded up to the nearest whole share of Common Stock if such fractional share is equal to or greater than  1
/2 of one share. The Company shall not be obliged to issue certificates evidencing the shares of Common Stock outstanding as a result of the Reverse Split
unless and until the certificates evidencing the shares held by a holder prior to the Reverse Split are either delivered to the Company or its transfer agent, or the holder notifies the Company or its transfer agent that such certificates have been
lost, stolen or destroyed and executes an agreement satisfactory to the Company to indemnify the Company from any loss incurred by it in connection with such certificates. Immediately after the Reverse Split, the rights, preferences, privileges,
restrictions and other matters related to the Common Stock are as set forth below in Section C.” 
  

	 	7.	That the Restated Certificate of Incorporation of the Company, as corrected, is set forth in its entirety as Exhibit A hereto. 

 [S1GNATURE PAGE FOLLOWS] 

 IN WITNESS WHEREOF, the Company has caused this Certificate of Correction to be signal by its Secretary
as of October 23, 2002. 
  

			
	TOLERION, INC.
		
	By:	 	 /s/ Alan C. Mendelson

		 	Alan C. Mendelson
		 	Secretary

 EXHIBIT A 
 RESTATED 
 CERTIFICATE OF INCORPORATION 
 OF 
 TOLERION, INC. 
 Tolerion, Inc. (the “Company”), formerly known as SunVax, Inc., organized and existing under the General Corporation Law of the State of
Delaware (the “General Corporation Law”), hereby certifies as follows: 
 I. The name of the Company is Tolerion, Inc.

 II. The original Certificate of Incorporation of the Company was filed with the Secretary of State of the State of Delaware on
December 6, 2000. 
 III. A Certificate of Amendment of the Certificate of Incorporation of the Company was filed with the Secretary of
State of the State of Delaware on April 5, 2002. 
 IV. A Restated Certificate of Incorporation of the Company was filed with the
Secretary of State of the State of Delaware on April 23, 2002. 
 V. The Board of Directors of the Company, acting in accordance with
Sections 141, 242 and 245 of the General Corporation Law of the State of Delaware, and the stockholders of the Company, acting in accordance with Sections 228 and 242 of the General Corporation Law of the State of Delaware, duly adopted resolutions
and declared the advisability of such resolutions to amend and restate the Certificate of Incorporation of the Company to read in its entirety as follows: 
 ARTICLE I. 
 The name of the corporation (hereinafter called the “Company”) is
Tolerion, Inc. 
 ARTICLE II. 
 The address of the registered office of the Company in the State of Delaware is 15 East North Street, City of Dover, County of Kent, and the name of the registered agent of the Company in the State of Delaware at such address is
Incorporating Services, Ltd. 
 ARTICLE III. 
 The purpose of the Company is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law. 

 ARTICLE IV. 
 A. Classes of Stock. This Company is authorized to issue two classes of shares to be designated, respectively, Preferred Stock (“Preferred Stock”) and Common Stock (“Common
Stock”). The total number of shares of capital stock that the Company is authorized to issue is 43,112,501 shares. 26,562,501 shares shall be Common Stock, par value $0.001 per share. 16,550,000 shares shall be Preferred Stock, par value
$0.001 per share, of which 16,550,000 shares shall be designated Series A Preferred Stock (the “Series A Preferred Stock”). 
 B. Rights, Preferences, and Restrictions of Preferred Stock. The Preferred Stock authorized by this Restated Certificate of Incorporation may be issued from time to time in one or more classes or series. The rights, preferences,
privileges, and restrictions granted to and imposed on the Series A Preferred Stock are set forth below in this Article IV(B). The Board of Directors is hereby authorized to fix or alter the rights, preferences, privileges and restrictions granted
to or imposed under additional series or classes of Preferred Stock, and the number of shares constituting any such series or class and the designation thereof, or of any of them. Subject to compliance with the protective voting rights which have
been granted in Section 6 of this Article IV(B) or may hereafter be granted to the Preferred Stock or series or class thereof in the Company’s Restated Certificate of Incorporation (“Protective Provisions”), but
notwithstanding any other rights of the Preferred Stock or any series or class thereof, the rights, privileges, preferences and restrictions of any such additional series or class may be subordinated to, pari passu with (including without
limitation, with respect to liquidation and acquisition preferences, redemption and/or approval of matters by vote or written consent) or senior to any present or future class or series of Preferred or Common Stock. Subject to compliance with
applicable Protective Provisions, the Board of Directors is also authorized to increase or decrease the number of shares of any series or class, prior or subsequent to the issue of that series or class, but not below the number of shares of such
series or class then outstanding. In case the number of shares of any series or class shall be so decreased, the shares constituting such decrease shall resume the status which they had prior to the adoption of the resolution originally fixing the
number of shares of such series or class. 
 1. Dividend Provisions. Subject to the rights of series or classes of Preferred Stock
which may from time to time come into existence pursuant to the then applicable Protective Provisions, the holders of shares of Series A Preferred Stock shall be entitled to receive noncumulative dividends, at the rate of eight percent (8%) of
the Series A Original Issue Price (as defined below) per annum on each outstanding share of Series A Preferred Stock (as adjusted Air any stock splits, reverse splits, stock dividends, combinations, recapitalizations and the like with respect to
such shares), out of any assets legally available therefor, prior and in preference to any declaration or payment of any dividend (payable other than in Common Stock or other securities and rights convertible into or entitling the holder thereof to
receive, directly or indirectly, additional shares of Common Stock or other securities of the Company pursuant to an event causing the Conversion Price of the Preferred Stock to be adjusted pursuant to Section 4(d)(iii) hereof) on the Common
Stock of the Company, when, as and if declared by the Board of Directors. 
 As to any additional declaration or payment of any dividend
(payable other than in Common Stock or other securities and rights convertible into or entitling the holder thereof to receive, directly or indirectly, additional shares of Common Stock or other securities of the Company pursuant to an event causing
the Conversion Price of the Preferred Stock to be adjusted pursuant to Section 4(d)(iii) hereof), outstanding shares of Series A Preferred Stock shall participate with shares of Common Stock, participating as though such shares of Series A
Preferred Stock had all been converted into Common Stock. 
  

 2 

 2. Liquidation Preference. 
 a. In the event of any liquidation, dissolution or winding up of the Company, either voluntary or involuntary, the holders of Series A Preferred Stock
shall be entitled to receive, prior to and in preference to any distribution of any of the assets of the Company to the holders of any other class of capital stock by reason of their ownership thereof, an amount per share equal to the Liquidation
Preference (as hereinafter defined) specified for each share of Series A Preferred Stock then held by them, plus any declared but unpaid dividends. The Liquidation Preference with respect to each share of Series A Preferred Stock shall mean
$ 1.00 per share (the “Series A Original Issue Price”), as adjusted for stock splits, reverse split, stock dividends, combinations, recapitalizations and the like. If upon the occurrence of such event, the assets and funds thus
distributed among the holders of the Series A Preferred Stock shall be insufficient to permit the payment to such holders of the full aforesaid preferential amount, then the entire assets and funds of the Company legally available for distribution
shall be distributed ratably among the holders of the Series A Preferred Stock in proportion to the preferential amount each such holder is otherwise entitled to receive. 
 b. Upon the completion of the distributions required by subparagraph (a) of this Section 2, any remaining assets shall be distributed ratably
among the holders of Common Stock and the holders of Series A Preferred Stock as if the Series A Preferred Stock had been converted into Common Stock in accordance with Article IV(B)4. 
 c. A consolidation or merger of the Company with or into any other corporation or corporations
that results in a change of greater than 50% of the voting control of the Company, or a sale, conveyance or disposition of all or substantially all of the assets of the Company or the effectuation by the Company of a transaction or series of related
transactions in which more than 50% of the voting power of the Company is disposed of (a “Change of Control Transaction”), shall be deemed to be a liquidation, dissolution or winding up within the meaning of this Section 2
unless holders of at least 66 2/3% of the then outstanding Series A Preferred Stock shall otherwise consent. 

d. In any of the events specified in (c) above, if the consideration received by the Company is other than cash, its value will be deemed its
fair market value. Any securities shall be valued at follows: 
 (i) Securities not subject to investment letter or other similar
restrictions on free marketability; 
 (A) If traded on a securities exchange or the Nasdaq National Market System, the value shall be deemed
to be the average of the closing prices of the securities on such exchange over the thirty-day period ending three (3) days prior to the closing; 
 (B) If actively traded over-the-counter, the value shall be deemed to be the average of the closing bid or sale prices (whichever is applicable) over the thirty-day period ending three (3) days prior to the
closing; and 
  

 3 

 (C) If there is no active public market, the value shall be the fair market value thereof, as mutually
determined by the Company and the holders of at least a majority of the voting power of all then outstanding shares of Preferred Stock; provided, however, that if the Company and the holders of a majority of the then outstanding shares of Preferred
Stock are unable to agree; then by independent appraisal by an investment bank selected by the Company and the holders of a majority of the then outstanding shares of Preferred Stock and paid for by the Company. 
 (ii) The method of valuation of securities subject to investment letter or other restrictions on free marketability (other than restrictions arising
solely by virtue of a stockholder’s status as an affiliate or former affiliate) shall be to make an appropriate discount from the market value determined as above in (i) (A), (B) or (C) to reflect the approximate fair market
value thereof, as mutually determined by the Company and the holders of at least a majority of the voting power of all then outstanding shares of Preferred Stock; provided, however, that if the Company and the holders of a majority of the then
outstanding shares of Preferred Stock are unable to agree, then by independent appraisal by an investment bank selected by the Company and the holders of a majority of the then outstanding shares of Preferred Stock and paid for by the Company.

 (iii) In the event the requirements of Section 2 are not complied with, this Company shall forthwith either: 
 (A) cause such closing to be postponed until such time as the requirements of this Section 2 have been complied with; or 
 (B) cancel such transaction, in which event the rights, preference, and privileges of the holders of the Preferred Stock shall revert to and be the same
as such rights, preferences and privileges existing immediately prior to the date of the first notice referred to in Section 2(d)(iv) hereof. 
 (iv) The Company shall give each holder of record of Preferred Stock written notice of such impending transaction not later than ten (10) business days prior to the stockholders’ meeting called to approve such transaction, or ten
(10) business days prior to the closing of such transaction, whichever is earlier, and shall also notify such holders in writing of the final approval of such transaction. The first of such notices shall describe the material terms and
conditions of the impending transaction and the provisions of this Section 2, and the Company shall thereafter give such holders prompt notice of any material changes. The transaction shall in no event take place sooner than ten
(10) business days after the Company has given the first notice provided for herein or sooner than ten (10) business days after the Company has given notice of any material changes provided for herein; provided, however, that such periods
may be shortened upon the written consent of the holders of Preferred Stock that are entitled to such notice rights or similar notice rights and that represent at least a majority of the voting power of all then outstanding shares of such Preferred
Stock. 
 3. Redemption. The Preferred Stock is not redeemable. 
  

 4 

 4. Conversion. The holders of the Preferred Stock shall have conversion rights as follows (the
“Conversion Rights”): 
 a. Right to Convert. Subject to Section 4(c), each share of Preferred Stock shall be
convertible, at the option of the holder thereof, at any time after the date of issuance of such share at the office of this Company or any transfer agent for such stock, into such number of fully paid and nonassessable shares of Common Stock as it
determined by dividing the Series A Original Issue Price, by the Conversion Price applicable to such share, determined as hereafter provided, in effect on the date the certificate is surrendered for conversion. The initial Series A Conversion Price
per share shall be the Series A Original Issue Price; provided, however, that such Conversion Price shall be subject to adjustment as set forth in subsection 4(d). 
 b. Automatic Conversion. Each share of Preferred Stock shall automatically be convened
into shares of Common Stock at the then-effective Conversion Price, upon the earlier of (i) the date specified by written consent or agreement of holders of at least 66  2/3% of the shares of Preferred Stock then outstanding, or (ii) immediately upon the closing of the sale of the Company’s Common Stock in a firm commitment, underwritten public offering
registered under the Securities Act of 1933, as amended (the “Securities Act”) other than a registration relating solely to a transaction under Rule 145 under the Securities Act (or any successor thereto) or to an employee benefit
plan of the Company, at a public offering price equal to or exceeding $5.00 per share of Common Stock (as adjusted for stock splits, reverse splits, stock dividends, combinations, recapitalizations and the like with respect to such shares) and which
results in aggregate cash proceeds to the Company of $20,000,000 (net of underwriting discounts and commissions). 
 c. Mechanics
of Conversion. Before any holder of Preferred Stock shall be entitled to convert the same into shares of Common Stock, he shall surrender the certificate or certificates therefor, duly endorsed, at the office of this Company or of any transfer
agent for the Preferred Stock, and shall give written notice to this Company at its principal corporate office, of the election to convert the same and shall state therein the name or names in which the certificate or certificates for shares of
Common Stock are to be issued. This Company shall, as soon as practicable thereafter, issue and deliver at such office to such holder of Preferred Stock, or to the nominee or nominees of such holder, a certificate or certificates for the number of
shares of Common Stock to which such holder shall be entitled as aforesaid. Such conversion shall be deemed to have been made immediately prior to the close of business on the date of such surrender of the shares of Preferred Stock to be converted,
and the person or persons entitled to receive the shares of Common Stock issuable upon such conversion shall be treated for all purposes as the record holder or holders of such shares of Common Stock as of such date. If the conversion is in
connection with an underwritten offering of securities registered pursuant to the Securities Act, the conversion may, at the option of any holder tendering Preferred Stock for conversion, be conditioned upon the closing with the underwriters of the
sale of securities pursuant to such offering, in which event the person(s) entitled to receive the Common Stock upon conversion of the Preferred Stock shall not be deemed to have converted such Preferred Stock until immediately prior to the closing
of such sale of securities. If the conversion is in connection with a Change of Control Transaction, the conversion may, at the option of any holder tendering Preferred Stock for conversion, be conditioned upon the closing of the Change of Control
Transaction, in which event (i) the holder shall not be deemed to have converted such Preferred Stock until immediately prior to 

  

 5 

 
the closing of such Change of Control Transaction and (ii) the holder shall be entitled to rescind such notice of conversion for five days after the
giving of any notice of a material change in terms pursuant to Section 2(d)(iv). 
 d. Conversion Price Adjustments. For
purposes of this Section 4(d), changes, to the Series A Conversion Price shall affect the conversion of the Series A Preferred Stock into Common Stock. The Series A Conversion Price shall be subject to equitable and proportional adjustment in the
event of stock splits, reverse splits, stock dividends, combinations, recapitalizations and the like and subject to adjustment from time to time as follows: 
 (i) (A) In the event the Company at any time after the Original Issue Date (as hereinafter defined) shall issue Additional Shares of Common Stock (including Additional Shares of Common Stock deemed to be issued
pursuant to Section 4(d)(i)(F)) without consideration or for a consideration per share less than the Series A Conversion Price, in effect on the date of and immediately prior to such issue, then and in such event, the Series A Conversion price
shall be reduced, concurrently with such issue, to a price (calculated to the nearest cent) determined by multiplying such Conversion Price by a fraction (x) the numerator of which shall be (1) the number of shares of Common Stock
outstanding immediately prior to such issue, plus (2) the number of shares of Common Stock which the aggregate consideration received by the Company for the total number of Additional Shares of Common Stock so issued would purchase at such
Conversion Price in effect immediately prior to such issuance, and (y) the denominator of which shall be (1) the number of shares of Common Stock outstanding immediately prior to such issue plus (2) the number of such Additional
Shares of Common Stock so issued, provided that for the purposes of the above calculation, the number of shares of Common Stock outstanding immediately prior to such issue shall be calculated on a fully diluted basis, i.e., all shares of Common
Stock issuable upon the exercise, conversion or exchange of outstanding options, warrants, convertible securities and Series A Preferred Stock, shall be deemed to be outstanding, and immediately after any Additional Shares of Common Stock are deemed
issued pursuant to Section 4(d)(i)(F) below, such Additional Shares of Common Stock shall be deemed to be outstanding. 
 (B)
“Original Issue Date” shall mean, if for the Series A Preferred Stock the date upon which the first share of Series A Preferred Stock is first issued. 
 (C) No adjustment of the Conversion Price for the Preferred Stock shall be made in an amount less than one cent per share, provided that any adjustments which are not required to be made by reason of this sentence
shall be carried forward and shall be either taken into account in any subsequent adjustment made prior to three years from the date of the event giving rise to the adjustment being carried forward, shall be made at the end of three years from the
date of the event giving rise to the adjustment being carried forward. 
 (D) In the case of the issuance of Common Stock for cash, the
consideration shall be deemed to be the amount of cash paid therefor before deducting any reasonable discounts, commissions or other expenses allowed, paid or incurred by this Company for any underwriting or otherwise in connection with the issuance
and sale thereof. 
  

 6 

 (E) In the case of the issuance of the Common Stock for a consideration in whole or in part other than
cash, the consideration other than cash shall be deemed to be the fair value thereof as determined by the Board of Directors irrespective of my accounting treatment 
 (F) In the event the Company at any time or from time to time after the Original Issue Date shall issue any options or convertible securities or shall fix a record date for the determination of holders of any
class of securities entitled to receive any such options or convertible securities, then the maximum number of shares (as set forth in the instrument relating thereto without regard to any provisions contained therein for a subsequent adjustment of
such number) of Common Stock issuable upon the exercise of such options or, in the case of convertible securities and options for convertible securities or for Series A Preferred Stock, the conversion or exchange of such convertible securities or
Series A Preferred Stock, than be deemed to be Additional Shares of Common Stock issued as of the time of such issue or, in the case such a record date shall have been fixed, as of the close of business on such record date, provided that Additional
Share of Common Stock shall not be deemed to have been issued of purposes of an adjustment of the Series A Conversion Price, unless the consideration per share (determined pursuant to Sections 4(d)(i)(D) and (E) hereof) of such Additional
Shares of Common Stock would be leas than the Series A Conversion Price, in effect on the date of and immediately prior to such issue, or such record date, as the case may be. and; provided further, that in any such case in which Additional Shares
of Common Stock are deemed to be issued: 
 (1) no further adjustment in the Series A Conversion Price shall be made upon the subsequent
issue of convertible securities, Series A Preferred Stock or shares of Common Stock upon the exercise of such options or conversion or exchange of such convertible securities or Series A Preferred Stock; 
 (2) if such options or convertible securities by their terms provide with the passage of time or otherwise, for any increase or decrease in the
consideration payable to the Company, or decrease or increase in me number of shares of Common Stock issuable, upon the exercise, conversion or exchange thereof the Series A Conversion Price, computed upon the original issue thereof (or upon the
occurrence of a record dale with respect therein), and any subsequent adjustments based thereon, shall, upon any such increase or decrease becoming effective, be recomputed to reflect such increase or decrease insofar as it affects such options or
the rights of conversion or exchange under such convertible securities (provided, however, that no such adjustment of the Series A Conversion Price, shall affect Common Stock previously issued upon conversion of the Series A Preferred Stock);

 (3) upon the expiration of any such options or any rights of conversion or exchange under such convertible securities which shall not
have been exercised, the Series A Conversion Price, computed upon (he original issue thereof (or upon the occurrence of a record date with respect thereto) and any subsequent adjustment* based thereon shall, upon such expiration, be recomputed as
if: 
 a) in the case of convertible securities or options for Common Stock the only Additional Shares of Common Stock issued were the shares
of Common Stock, if any. actually issued upon the exercise of such options or the conversion or 
  

 7 

 
exchange of such convertible securities and the consideration received therefor was the consideration actually received by the Company for the issue of such
options, whether or not exercised, plus the consideration actually received by the Company upon such exercise ox for the issue of all such convertible securities which were actually converted or exchanged, plus the additional consideration, if any,
actually received by the Company upon such conversion or exchange, and 
 b) in the case of options for convertible securities or Series A
Preferred Stock, only the convertible securities or Series A Preferred Stock, if any, actually issued upon the exercise thereof were issued at the time of issue of such options, and the consideration received by the Company for the Additional Shares
of Common Stock deemed to have been then issued was the consideration actually received by the Company for the issue of such options, whether or not exercised, plus the consideration deemed to have been received by the Company (determined pursuant
to Sections 4(d)(i)(D) and (E) hereof) upon the issue of the convertible securities or Series A Preferred Stock, with respect to which such options were actually exercised; 
 (4) no readjustment pursuant to clause (2) or (3) above shall have the effect of increasing the Series A Conversion Price, to an amount which
exceeds the lower of (i) the Series A Conversion Price, on the original adjustment date, or (ii) the Series A Conversion Price, that would have resulted from any issuance of Additional Sham of Common Stock between the original adjustment date
and such readjustment date; 
 (5) in the case of any options which expire by their terms not shares more than thirty (30) days after
the date of issue thereof, no adjustment of the Series A Conversion Price, shall be made until the expiration or exercise of all such options issued on the same date, whereupon such adjustment shall be made in the same manner provided in clause
(3) above; and 
 (6) if such record date shall have been fixed and such options or convertible securities are not issued on the date
fixed therefor, the adjustment previously made in the Series A Conversion Price, which became effective on such record date shall be canceled as of the close of business on such record date, and thereafter the Series A Conversion Price, shall be
adjusted pursuant to this Section 4(d)(i)(F) as of the actual date of their issuance. 
 (ii) “Additional Shares”
shall mean any shares of Common Stock issued (or deemed to have been issued pursuant to subsection 4(d)(i)(F) by this Company after the Original Issue Date other than: 
 (A) up to 2,300,000 shares of Common Stock issuable or issued to employees, consultants rendering services to the Company or directors (if in transaction with primarily non-financing purposes) of this Company pursuant
to a stock option plan or restricted stock plan approved by the Board of Directors of the Company and the Compensation Committee thereof, if applicable; 
  

 8 

 (B) shares of Common Stock issued or issuable in connection with bona fide acquisitions, mergers,
technology licenses or purchases, corporate partnering agreements or similar transactions, the terms of which are approved by the Bond of Directors of the Company; 
 (C) shares of Common Stock issued or issuable (i) in a public offering before or in connection with which all outstanding shafts of Preferred Stock will be converted to Common Stock or ((ii) upon exercise of
warrants or rights granted to underwriters in connection with such a public offering; 
 (D) shares of Common Stock issued or issuable to
financial institutions, landlords or lessors in connection with commercial credit agreements, real estate transactions, equipment financings or similar transactions; 
 (E) upon conversion of shares of Preferred Stock. 
 (iii) If the member of shares of Common Stock
outstanding at any time after the Original Issue Date is increased or decreased as the result of stock splits, reverse splits, stock dividends, combinations, recapitalizations or the like with respect to the outstanding shares of Common Stock, then,
following the record date of such stock split, reverse split, stock dividend, combination, recapitalization or the like, the Conversion Price of the Preferred Stock shall be appropriately adjusted so that the number of shares of Common Stock
issuable upon conversion of each share of Preferred Stock shall be adjusted in proportion to such increase or decrease in outstanding shares of Common Stock. 
 e. Other Distributions. In the event this Company shall declare a distribution payable in securities of other persons, evidences of indebtedness issued by this Company or other persons, assets (excluding cash
dividends) or options or rights not referred to in Section 4(d)(i), then, in each such case for the purpose of this Section 4(d), the holders of the Preferred Stock shall be entitled to a proportionate share of any distribution as though
they were the holders of the number of shares of Common Stock of the Company into which their shares of Preferred Stock are convertible as of the record date fixed for the determination of the holders of Common Stock of the Company entitled to
receive such distribution. 
 f. Recapitalization. If at any time or from time
to time there shall be a recapitalization of the Common Stock (other than a subdivision, combination or merger or sale of assets transaction provided for elsewhere in this Section 4 or in Section 2, but including any Change of Control
Transaction which the holders of 66  2/3% of the Series A Preferred Stock determine Shall not be treated as a liquidation)
provision shall be made so that the holders, of Preferred Stock shall thereafter be entitled to receive upon conversion thereof the number of shares of stock or other securities or property of tie Company or Otherwise, to which a holder of Common
Stock deliverable upon convention would have been entitled on such recapitalization, in any such case, appropriate adjustment shall be made in the application of the provisions of this Section 4 with respect to the rights of the holders of
Preferred Stock after the recapitalization to the end that the provisions of this Section 4 (including adjustment of the Conversion Price then in effect and the number of shares purchasable upon conversion of each series or class of the
Preferred Stock) shall be applicable after that event as nearly equivalent as may be practicable. 
  

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 g. No Impairment This Company will not, by amendment of its Restated Certificate of Incorporation
or through any reorganization, recapitalization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be
observed or performed hereunder by this Company, but will at all times in good faith assist in the carrying out of all the provisions of this Section 4 and in the taking of all such actions as may be necessary or appropriate in order to protect
the Conversion Rights of the holders of the Preferred Stock against impairment. 
 h. No Fractional Shares and Certificate as to
Adjustments. 
 (i) No fractional shares shall be issued upon the conversion of any share or shares of the Preferred Stock, and the
number of shares of Common Stock to be issued that be rounded to the nearest whole share. Whether or not fractional shares are issuable upon such conversion shall be determined on the basis of the total number of shares of Preferred Stock the holder
is at the lime converting into Common Stock and the number of shares of Common Stock issuable upon such aggregate conversion. 
 ((ii)) Upon
the occurrence of each adjustment or readjustment of the Conversion Price of the Preferred Stock pursuant to this Section 4, this Company, at its expense, shall promptly compute such adjustment or readjustment in accordance with the terms
hereof and prepare and furnish to each holder of Preferred Stock a certificate setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment or readjustment is based. This Company shall, upon the written
request at any time of any bolder of Preferred Stock, furnish or cause to be furnished to such holder a like certificate setting forth (a) such adjustment and readjustment, (b) the Conversion Price for such Preferred Stock at the time in
effect, and (c) the number of shares of Common Stock and the amount, if any, of other property which at the time would be received upon the conversion of a share of the Preferred Stock. 
 i. Notices of Record Date. In the event of any taking by this Company of a record of the holders of any class of securities for the purpose of
determining the holders thereof who are entitled to receive any dividend (other than a cash dividend) or other distribution, any right to subscribe for, purchase or otherwise acquire any shares of stock of any class or any Other securities or
property, or to receive any other right, this Company shall mail to each bolder of Preferred Stock, at least ten (10) business days prior to the date specified therein, a notice specifying the date on which any such record is to be taken for
the purpose of such dividend, distribution or right, and the amount and character of such dividend, distribution or right. 
 j.
Reservation of Stock Issuable Upon Conversion. This Company shall at all times reserve and keep available out of its authorized but unissued shares of Common stock, solely for the purpose of effecting the conversion of the shares of the
Preferred Stock, such number of its shares of Common Stock as shall from time to time be sufficient to effect the conversion of all outstanding shares of the Preferred Stock; and if at any time the number of authorized but unissued shares of Common
Stock shall not be sufficient to effect the conversion of all then outstanding shares of Preferred Stock, in addition to such other remedies as shall be available to the holder of such Preferred Stock, this Company will take such corporate action as
may, in the opinion of its counsel, be necessary to increase its authorized but unissued shares of 
  

 10 

 
Common Stock to such number of shares as shall be sufficient for such purposes, including, without limitation, engaging in best efforts to obtain the
requisite stockholder approval of any necessary amendment to this Restated Certificate of Incorporation. 
 k. Notices. Any notice
required by the provisions of this Section 4 to be given to the holders of shares of Preferred Stock shall be deemed given if deposited in the United States mail, postage prepaid, and addressed to each holder of record at his address appearing
on the books of this Company. 
 5. Voting Rights. Each holder of shares of Preferred Stock shall be entitled to the number of votes
equal to the number of shares of Common Stock into which such shares of Preferred Stock could be converted and shall have voting rights and powers equal to the voting rights and powers of the Common Stock (except as otherwise expressly provided
herein or as required by law, voting together with the Common Stock as a single class) and shall be entitled to notice of any stockholders’ meeting in accordance with the Bylaws of the Company. Fractional votes shall not, however, be permitted
and any fractional voting rights resulting from the above formula (after aggregating all shares into which shares of Preferred Stock held by each holder could be converted) shall be rounded to the nearest whole number (with one-half being rounded
upward). 
 The holders of the Preferred Stock shall vote together with the holders of the Common Stock on all matters, except that (i) only
the holders of at least a majority of the then outstanding shares of Series A Preferred Stock shall be entitled to elect, voting together as a class, four (4) directors of the Company’s Board of Directors and shall not otherwise be
permitted to vote with the Common Stock as to the election of directors (provided that if no shares of Series A Preferred Stock remain outstanding, then the holders of at least a majority of the then outstanding shares of Common Stock shall be
entitled to elect, voting together as a class, such four (4) directors), (ii) only the holders of at least a majority of the then outstanding shares of Common Stock shall be entitled to elect, voting together as a class, two
(2) directors of the Company’s Board of Directors and shall not otherwise be permitted to vote with the Preferred Stock as to the election of directors, and (in) the holders of at least a majority of the then outstanding shares of
Preferred Stock and Common Stock shall be entitled to elect, voting together as a class, the remaining director or directors. 
 6. Protective Provisions. Subject to the rights of series or classes of Preferred Stock
which may from time to time come into existence in accordance with the following Protective Provisions, this Company shall not without first obtaining the approval (by vote or written consent, as provided by law) of the holders of at least 66  2/3% of the then outstanding shares of Series A Preferred Stock voting as a separate class: 
 a. sell, convey, or otherwise dispose of all or substantially all of its property or business or merge into or consolidate with any other company (other
than a wholly-owned subsidiary company) or effect any other transaction or series of related transactions in which more than fifty percent (50%) of the voting power of the Company is disposed of, provided that this Section 6(a) shall not
apply to a merger effected exclusively for the purpose of changing the domicile of the Company; 
  

 11 

 b. amend or modify the Restated Certificate of Incorporation or Bylaws of the Company; 
 c. amend or change the rights, preferences or privileges of the Series A Preferred Stock; 
 d. authorize or issue, or obligate itself to issue, any other equity security, including any other security convertible into or exercisable for any
equity security, having a preference over, or being on a parity with, the Series A Preferred Stock with respect to voting, dividends or upon liquidation; 
 e. redeem, purchase or otherwise acquire (or pay into or set funds aside for a sinking fund for such purpose) any share or shares of Preferred Stock or Common Stock; provided, however, that this restriction shall not
apply to the repurchase of shares of Common Stock from employees, officers, directors, consultants or other persons performing services for the Company or any subsidiary pursuant to agreements under which the Company has the option to repurchase
such shares at cost or at cost upon the occurrence of certain events, such as the termination of employment; 
 f. increase or decrease the
authorized Preferred Stock; 
 g. reclassify or recapitalize the capital stock of the Company; 
 h. effect the liquidation of the Company; or 
 i. issue (directly or pursuant to the exercise of any option) or authorize or reserve for issuance to employees, consultants and directors as equity incentive compensation in excess of 2,500,000 shares of Common Stock, whether or not
pursuant to a benefit plan, and taking into account all such shares that have been so issued, authorized or reserved as of the dale of filing of this Restated Certificate of Incorporation. 
 In addition, the consent of 66  2/3
% of the Series A Preferred Stock, shall be required for any action that (i) adversely effects the rights, preferences or privileges of the Series A Preferred Stock in a manner different from that of
other classes of Preferred Stock that might be created, (if) creates or is likely to create a conflict of interest between the Series A Preferred Stock and any other class of Preferred Stock that might be created, or (iii) creates a class or
series of stock or any other securities convertible into equity securities of the Company having a preference over the Series A Preferred Stock. 
 7. Status of Converted Stock. In the event any shares of Preferred Stock shall be convened pursuant to Section 4 hereof, the shares so converted shall be cancelled and shall not be issuable by the Company.
The Restated Certificate of Incorporation of the Company shall be appropriately amended to effect the corresponding reduction in the Company’s authorized capital stock. 
  

 12 

 C. Common Stock. 
 1. Dividend Right. Subject to the prior rights of holder of all classes of stock at the time outstanding having prior rights as to dividends, the holders of the Common Stock shall be entitled to receive, when
and at declared by the Board of Directors, out of any assets of the Company legally available therefor, such dividends as may be declared from time to time by the Board of Directors. 
 2. Liquidation Rights. Upon the liquidation, dissolution or winding up of the Company, the assets of the Company shall be distributed to the
holders of the Common Stock as provided in Article IV(B)2. 
 3. Redemption. The Common Stock is not redeemable. 
 4. Voting Rights. The holder of each share of Common Stock shall have the right to one vote, and shall be entitled to notice of try
stockholders’ meeting in accordance with the Bylaws of the Company, and shall be entitled to vote upon such matters and in such manner as may be provided by law. 
 ARTICLE V. 
 Except as otherwise provided in this Restated Certificate of Incorporation, in
furtherance and not in limitation of the powers conferred by statute, the Board of Directors is expressly authorized to make, repeal, alter, amend and rescind any or all of the Bylaws of the Company. 
 ARTICLE VI. 
 The number of directors
of the Company shall be such number as set forth in the Company’s Bylaws, as amended: 
 ARTICLE VII. 
 Elections of directors need not be by written ballot unless the Bylaws of the Company shall so provide. 
 ARTICLE VIII. 
 Meetings of
stockholders may be held within or without the State of Delaware, as the Bylaws may provide. The books of the Company may be kept (subject to any provision contained in the statutes) outside the State of Delaware at such places or places as may be
designated from time to time by the Board of Directors or in the Bylaws of the Company. 
 ARTICLE IX. 
 The Company is to have perpetual existence. 
  

 13 

 ARTICLE X. 
 The Company reserves the right to amend, altar, change or repeal any provision contained in this Restated Certificate of Incorporation, in the manner now or hereafter prescribed by statute, and all rights conferred
upon stockholders herein are granted subject to this reservation; provided, however, that any provision requiring the vote or consent of more than a majority of a class or series of shares shall not be amended unless such amendment shall have
received the vote or consent of the requisite percentage of such class or series of shares originally required to give such vote or consent. 
 ARTICLE XI. 
 (A) Limitation of Directors’ and Officers’ Liability Indemnification. 
 (1) To the fullest extent permitted by the General Corporation Law as the same exists or may hereafter be amended, a director of the Company shall not be
personally liable to the Company or its stockholders for monetary damages for breach of fiduciary duty as a director. Neither any amendment nor repeal of this Article XI, nor the adoption of any provisions of this Restated Certificate of
Incorporation inconsistent with this Article XI, shall eliminate or reduce the effect of this Article XI in respect of any matter occurring, or any cause of action, suit or claim that, but for this Article XI, would accrue or arise, prior to such
amendment, repeal or adoption of an inconsistent provision. 
 (2) To the fullest extent permitted by applicable law, this Company is
authorized to provide indemnification of (and advancement of expenses to) directors, officers, employees and other agents of this Company (and any other persons to which Delaware law permits this Company to provide indemnification), through Bylaw
provisions, agreements with any such director, officer, employee or other agent or other person, vote of stockholders or disinterested directors, or otherwise, in excess of the indemnification and advancement otherwise permitted by the General
Corporation Law, subject only to limits created by applicable Delaware law (statutory or nonstatutory), with respect to actions for breach of duty to a corporation, its stockholders and others. 
 (B) Repeal or Modification. Neither any amendment, repeal or modification of the foregoing provisions of this Article XI by the stockholders of
this Company, nor the adoption of any provision of this Company’s Restated Certificate of Incorporation inconsistent with this Article XI, shall adversely affect any right or protection of an agent of the Company existing at the time of such
amendment, repeal or modification. 
  

 14 

 IN WITNESS WHEREOF, the Company has caused this Restated Certificate of Incorporation to be signed by
Lawrence Steinman, its President, as of July 31, 2002. 
  

			
	Tolerion, Inc.
	
	 /s/ Lawrence Steinman

	Name:	 	Lawrence Steinman
	Title:	 	President

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