Document:

Exhibit
      10.1

    SECURITIES
      PURCHASE AGREEMENT

     

    This
      Securities Purchase Agreement (this “Agreement”)
      is
      dated as of April 24, 2008, between NutraCea, a California corporation (the
      “Company”),
      and
      each purchaser identified on the signature pages hereto (each, including its
      successors and assigns, a “Purchaser”
and
      collectively the “Purchasers”).

     

    WHEREAS,
      subject to the terms and conditions set forth in this Agreement and pursuant
      to
      an effective registration statement under the Securities Act of 1933, as amended
      (the “Securities
      Act”),
      the
      Company desires to issue and sell to each Purchaser, and each Purchaser,
      severally and not jointly, desires to purchase from the Company, securities
      of
      the Company as more fully described in this Agreement.

     

    NOW,
      THEREFORE, IN CONSIDERATION of the mutual covenants contained in this Agreement,
      and for other good and valuable consideration the receipt and adequacy of which
      are hereby acknowledged, the Company and each Purchaser agree as
      follows:

     

    ARTICLE
      I.

    DEFINITIONS

     

    1.1 Definitions.
      In
      addition to the terms defined elsewhere in this Agreement, for all purposes
      of
      this Agreement, the following terms have the meanings set forth in this Section
      1.1:

     

    “Acquiring
      Person”
shall
      have the meaning ascribed to such in Section 4.5.

     

    “Action”
shall
      have the meaning ascribed to such term in Section 3.1(j).

     

    “Affiliate”
means
      any Person that, directly or indirectly through one or more intermediaries,
      controls or is controlled by or is under common control with a Person as such
      terms are used in and construed under Rule 405 under the Securities Act.

     

    “Board
      of Directors”
means
      the board of directors of the Company.

     

    “Business
      Day”
means
      any day except Saturday, Sunday, any day which is a federal legal holiday in
      the
      United States or any day on which banking institutions in the State of New
      York
      are authorized or required by law or other governmental action to
      close.

     

    “Closing”
means
      the closing of the purchase and sale of the Securities pursuant to Section
      2.1.

     

    “Closing
      Date”
means
      the Trading Day when all of the Transaction Documents have been executed and
      delivered by the applicable parties thereto, and all conditions precedent to
      (i)
      the Purchasers’ obligations to pay the Subscription Amount and (ii) the
      Company’s obligations to deliver the Securities have been satisfied or
      waived.

     

    “Commission”
means
      the United States Securities and Exchange Commission.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    “Common
      Stock”
means
      the common stock of the Company, no par value per share, and any other class
      of
      securities into which such securities may hereafter be reclassified or changed
      into. 

     

    “Common
      Stock Equivalents”
means
      any securities of the Company or the Subsidiaries which would entitle the holder
      thereof to acquire at any time Common Stock, including, without limitation,
      any
      debt, preferred stock, rights, options, warrants or other instrument that is
      at
      any time convertible into or exercisable or exchangeable for, or otherwise
      entitles the holder thereof to receive, Common Stock.

     

    “Company
      Counsel”
means
      Weintraub Genshlea Chediak Law Corporation, with offices located at 400 Capitol
      Mall, Eleventh Floor, Sacramento, California 95814. 

     

    “Disclosure
      Schedules”
means
      the Disclosure Schedules of the Company delivered concurrently herewith.

     

    “Discussion
      Time”
shall
      have the meaning ascribed to such term in Section 3.2(e).

     

    “Evaluation
      Date”
shall
      have the meaning ascribed to such term in Section 3.1(r). 

     

    “Exchange
      Act”
means
      the Securities Exchange Act of 1934, as amended, and the rules and regulations
      promulgated thereunder.

    

    “Exempt
      Issuance”
means
      the issuance of (a) shares of Common Stock or options to consultants, employees,
      officers or directors of the Company pursuant to any stock or option plan duly
      adopted for such purpose, by a majority of the non-employee members of the
      Board
      of Directors of the Company or a majority of the members of a committee of
      non-employee directors established, (b) securities upon the exercise or exchange
      of or conversion of any Securities issued hereunder and/or other securities
      exercisable or exchangeable for or convertible into shares of Common Stock
      issued and outstanding on the date of this Agreement, provided that such
      securities have not been amended since the date of this Agreement to increase
      the number of such securities or to decrease the exercise, exchange or
      conversion price of such securities other than pursuant to their terms in effect
      as of the date hereof, (c) shares of Common Stock issued or issuable as a
      dividend on Common Stock, (d) shares of Common Stock issued to any broker or
      placement agent in connection with the transactions consummated pursuant to
      this
      Agreement, (e) shares of Common Stock issued by the Company as a penalty
      pursuant to the Prior Registration Rights Agreements, (e) securities issued
      in
      any transactions that is approved in writing by the holders of a majority of
      the
      Shares still held by the Purchases, and (f) securities issued pursuant to
      acquisitions or strategic transactions (including securities issuable to brokers
      for such transactions) approved by a majority of the disinterested directors
      of
      the Company, provided that any such issuance shall only be to a Person which
      is,
      itself or through its subsidiaries, an operating company in a business
      synergistic with the business of the Company and in which the Company receives
      benefits in addition to the investment of funds, but shall not include a
      transaction in which the Company is issuing securities primarily for the purpose
      of raising capital or to an entity whose primary business is investing in
      securities. 

     

    
      
        
        

      

      
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    “FWS”
means
      Feldman Weinstein & Smith LLP with offices located at 420 Lexington Avenue,
      Suite 2620, New York, New York 10170-0002.

     

    “GAAP”
shall
      have the meaning ascribed to such term in Section 3.1(h).

     

    “Indebtedness”
shall
      have the meaning ascribed to such term in Section 3.1(z).

     

    “Intellectual
      Property Rights”
shall
      have the meaning ascribed to such term in Section 3.1(o).

     

    “Liens”
means
      a
      lien, charge, security interest, encumbrance, right of first refusal, preemptive
      right or other restriction.

     

    “Material
      Adverse Effect”
shall
      have the meaning assigned to such term in Section 3.1(b).

     

    “Material
      Permits”
shall
      have the meaning ascribed to such term in Section 3.1(m).

     

    “Per
      Share Purchase Price”
equals
      $0.90, subject to adjustment for reverse and forward stock splits, stock
      dividends, stock combinations and other similar transactions of the Common
      Stock
      that occur from the day after the date of this Agreement through the Closing
      Date.

     

    “Person”
means
      an individual or corporation, partnership, trust, incorporated or unincorporated
      association, joint venture, limited liability company, joint stock company,
      government (or an agency or subdivision thereof) or other entity of any
      kind.

     

    “Prior
      Registration Rights Agreements”
shall
      mean, collectively, (i) that
      certain Registration Rights Agreement that was entered into by the Company
      and
      certain investors in connection with the Company’s issuance of its Series B
      Convertible Preferred Stock on October 4, 2005, (ii) that certain Registration
      Rights Agreement that was entered into by the Company and certain investors in
      connection with the Company’s issuance of its Series C Convertible Preferred
      Stock on May 12, 2006 and (iii) that certain Registration Rights Agreement
      that
      was entered into by the Company and certain investors in connection with the
      Company’s issuance of Common Stock on February 15, 2007.

     

    “Proceeding”
means
      an action, claim, suit, investigation or proceeding (including, without
      limitation, an informal investigation or partial proceeding, such as a
      deposition), whether commenced or threatened.

     

    “Prospectus”
means
      the base prospectus contained in the Registration Statement at the time it
      was
      declared effective by the Commission.

     

    “Prospectus
      Supplement”
means
      the supplement to the Prospectus complying with Rule 424(b) of the Securities
      Act that is filed with the Commission and delivered by the Company to each
      Purchaser at the Closing.

     

    
      
        
        

      

      
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    “Purchaser
      Party”
shall
      have the meaning ascribed to such term in Section 4.8.

     

    “Registration
      Statement”
means
      the effective registration statement with Commission file No. 333-148929 which
      registers the sale of the Shares, the Warrants and the Warrant Shares by the
      Purchasers.

     

    “Required
      Approvals”
shall
      have the meaning ascribed to such term in Section 3.1(e).

     

    “Rule
      144”
means
      Rule 144 promulgated by the Commission pursuant to the Securities Act, as such
      Rule may be amended from time to time, or any similar rule or regulation
      hereafter adopted by the Commission having substantially the same effect as
      such
      Rule. 

     

    “SEC
      Reports”
shall
      have the meaning ascribed to such term in Section 3.1(h).

     

    “Securities”
means
      the Shares, the Warrants and the Warrant Shares.

     

    “Securities
      Act”
means
      the Securities Act of 1933, as amended, and the rules and regulations
      promulgated thereunder.

     

    “Shares”
means
      the shares of Common Stock issued or issuable to each Purchaser pursuant to
      this
      Agreement.

     

    “Short
      Sales”
means
      all “short sales” as defined in Rule 200 of Regulation SHO under the Exchange
      Act (but
      shall not be deemed to include the location and/or reservation of borrowable
      shares of Common Stock). 

     

    “Subscription
      Amount”
means,
      as to each Purchaser, the aggregate amount to be paid for Shares and Warrants
      purchased hereunder as specified below such Purchaser’s name on the signature
      page of this Agreement and next to the heading “Subscription Amount,” in United
      States dollars and in immediately available funds.

     

    “Subsidiary”
means
      any subsidiary of the Company as set forth in the SEC Reports or Schedule
      3.1(a),
      and
      shall, where applicable, also include any direct or indirect subsidiary of
      the
      Company formed or acquired after the date hereof.

     

    “Trading
      Day”
means
      a
      day on which the New York Stock Exchange is open for trading.

     

    “Trading
      Market”
means
      the following markets or exchanges on which the Common Stock is listed or quoted
      for trading on the date in question: the American Stock Exchange, the Nasdaq
      Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market,
      the
      New York Stock Exchange or the OTC Bulletin Board.

     

    “Transaction
      Documents”
means
      this Agreement, the Warrants and any other documents or agreements executed
      in
      connection with the transactions contemplated hereunder.

     

    
      
        
        

      

      
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    “Transfer
      Agent”
means
      American Stock Transfer & Trust, with a mailing address of 59 Maiden Lane,
      Plaza Level - Lobby New York, NY  10038 and a facsimile number of 718 921
      8116, and any successor transfer agent of the Company.

     

    “Trigger
      Price”
shall
      initially mean the Per Share Purchase Price, and shall adjust thereafter as
      provided in the Warrants.

     

    “Variable
      Rate Transaction”
shall
      have the meaning ascribed to such term in Section 4.13(b).

     

    “VWAP”
means,
      for any date, the price determined by the first of the following clauses that
      applies: (a) if the Common Stock is then listed or quoted on a Trading Market,
      the daily volume weighted average price of the Common Stock for such date (or
      the nearest preceding date) on the Trading Market on which the Common Stock
      is
      then listed or quoted for trading as reported by Bloomberg L.P. (based on a
      Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City
      time); (b)  if the OTC Bulletin Board is not a Trading Market, the volume
      weighted average price of the Common Stock for such date (or the nearest
      preceding date) on the OTC Bulletin Board; (c) if the Common Stock is not then
      listed or quoted for trading on the OTC Bulletin Board and if prices for the
      Common Stock are then reported in the “Pink Sheets” published by Pink Sheets,
      LLC (or a similar organization or agency succeeding to its functions of
      reporting prices), the most recent bid price per share of the Common Stock
      so
      reported; or (d) in all other cases, the fair market value of a share of
      Common Stock as determined by an independent appraiser selected in good faith
      by
      the Purchasers of a majority in interest of the Shares then outstanding and
      reasonably acceptable to the Company, the fees and expenses of which shall
      be
      paid by the Company. 

     

    “Warrants”
means,
      collectively, the Common Stock purchase warrants delivered to the Purchasers
      at
      the Closing in accordance with Section 2.2(a) hereof, which Warrants shall
      be
      exercisable immediately and have a term of exercise equal to five years, in
      the
      form of Exhibit
      A
      attached
      hereto.

     

    “Warrant
      Shares”
means
      the shares of Common Stock issuable upon exercise of the Warrants.

     

    ARTICLE
      II.

    PURCHASE
      AND SALE

     

    2.1 Closing.
      On the Closing Date, upon the terms and subject to the conditions set forth
      herein, substantially concurrent with the execution and delivery of this
      Agreement by the parties hereto, the Company agrees to sell, and the Purchasers,
      severally and not jointly, agree to purchase, up to an aggregate of
      $[___,000,000 of Shares and Warrants. Each Purchaser shall deliver to the
      Company, via wire transfer or a certified check, immediately available funds
      equal to its Subscription Amount and the Company shall deliver to each Purchaser
      its respective Shares and a Warrant as determined pursuant to Section 2.2(a),
      and the Company and each Purchaser shall deliver the other items set forth
      in
      Section 2.2 deliverable at the Closing. Upon satisfaction of the covenants
      and
      conditions set forth in Sections 2.2 and 2.3, the Closing shall occur at the
      offices of Company Counsel or such other location as the parties shall mutually
      agree.

     

    
      
        
        

      

      
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    2.2 Deliveries.

     

    (a) On
      or
      prior to the Closing Date, the Company shall deliver or cause to be delivered
      to
      each Purchaser the following:

     

    (i) this
      Agreement duly executed by the Company;

     

    (ii) a
      legal
      opinion of Company Counsel, substantially in the form of Exhibit
      B
      attached
      hereto; 

     

    (iii) a
      copy of
      the irrevocable instructions to the Company’s transfer agent instructing the
      transfer agent to deliver via the Depository Trust Company Deposit Withdrawal
      Agent Commission System (“DWAC”)
      Shares
      equal to such Purchaser’s Subscription Amount divided by the Per Share Purchase
      Price, registered in the name of such Purchaser;

     

    (iv) a
      Warrant
      registered in the name of such Purchaser to purchase up to a number of shares
      of
      Common Stock equal to 30% of the Shares purchased by such Purchaser hereunder,
      with an exercise price equal to $1.20, subject to adjustment therein (such
      Warrant certificate may be delivered within three Trading Days of the Closing
      Date); and

     

    (v) the
      Prospectus and Prospectus Supplement (which may be delivered in accordance
      with
      Rule 172 under the Securities Act).

     

    (b) On
      or
      prior to the Closing Date, each Purchaser shall deliver or cause to be delivered
      to the Company the following:

     

    (i) this
      Agreement duly executed by such Purchaser; and

     

    (ii) such
      Purchaser’s Subscription Amount by wire transfer to the account as specified in
      writing by the Company.

     

    2.3 Closing
      Conditions. 

     

    (a) The
      obligations of the Company hereunder in connection with the Closing are subject
      to the following conditions being met:

     

    (i) the
      accuracy in all material respects on the Closing Date of the representations
      and
      warranties of the Purchasers contained herein; 

     

    (ii) all
      obligations, covenants and agreements of each Purchaser required to be performed
      at or prior to the Closing Date shall have been performed;
      and

     

    
      
        
        

      

      
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    (iii) the
      delivery by each Purchaser of the items set forth in Section 2.2(b) of this
      Agreement.

     

    (b) The
      respective obligations of the Purchasers hereunder in connection with the
      Closing are subject to the following conditions being met:

     

    (i) the
      accuracy in all material respects on the Closing Date of the representations
      and
      warranties of the Company contained herein;

     

    (ii) all
      obligations, covenants and agreements of the Company required to be performed
      at
      or prior to the Closing Date shall have been performed; 

     

    (iii) the
      delivery by the Company of the items set forth in Section 2.2(a) of this
      Agreement; 

     

    (iv) there
      shall have been no Material Adverse Effect with respect to the Company since
      the
      date hereof; and

     

    (v) from
      the
      date hereof to the Closing Date, trading in the Common Stock shall not have
      been
      suspended by the Commission or the Company’s principal Trading Market (except
      for any suspension of trading of limited duration agreed to by the Company,
      which suspension shall be terminated prior to the Closing), and, at any time
      prior to the Closing Date, trading in securities generally as reported by
      Bloomberg L.P. shall not have been suspended or limited, or minimum prices
      shall
      not have been established on securities whose trades are reported by such
      service, or on any Trading Market, nor shall a banking moratorium have been
      declared either by the United States or New York State authorities nor shall
      there have occurred any material outbreak or escalation of hostilities or other
      national or international calamity of such magnitude in its effect on, or any
      material adverse change in, any financial market which, in each case, in the
      reasonable judgment of each Purchaser, makes it impracticable or inadvisable
      to
      purchase the Securities at the Closing.

     

    ARTICLE
      III.

    REPRESENTATIONS
      AND WARRANTIES

     

    3.1 Representations
      and Warranties of the Company. Except as set forth in the Disclosure
      Schedules, the Company hereby makes the following representations and warranties
      to each Purchaser:

     

    (a) Subsidiaries.
      All of
      the direct and indirect subsidiaries of the Company are set forth in the SEC
      Reports or on Schedule
      3.1(a).
      Except
      as set forth on Schedule
      3.1(a),
      the
      Company owns, directly or indirectly, all of the capital stock or other equity
      interests of each Subsidiary free and clear of any Liens, and all of the issued
      and outstanding shares of capital stock of each Subsidiary are validly issued
      and are fully paid, non-assessable and free of preemptive and similar rights
      to
      subscribe for or purchase securities. If the Company has no subsidiaries, then
      all other references to the Subsidiaries or any of them in the Transaction
      Documents shall be disregarded.

     

    
      
        
        

      

      
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    (b) Organization
      and Qualification.
      The
      Company and each of the Subsidiaries is an entity duly incorporated or otherwise
      organized, validly existing and in good standing under the laws of the
      jurisdiction of its incorporation or organization (as applicable), with the
      requisite power and authority to own and use its properties and assets and
      to
      carry on its business as currently conducted. Neither the Company nor any
      Subsidiary is in violation or default of any of the provisions of its respective
      certificate or articles of incorporation, bylaws or other organizational or
      charter documents. Each of the Company and the Subsidiaries is duly qualified
      to
      conduct business and is in good standing as a foreign corporation or other
      entity in each jurisdiction in which the nature of the business conducted or
      property owned by it makes such qualification necessary, except where the
      failure to be so qualified or in good standing, as the case may be, could not
      have or reasonably be expected to result in (i) a material adverse effect on
      the
      legality, validity or enforceability of any Transaction Document, (ii) a
      material adverse effect on the results of operations, assets, business, current
      prospects or financial condition of the Company and the Subsidiaries, taken
      as a
      whole, or (iii) a material adverse effect on the Company’s ability to perform in
      any material respect on a timely basis its obligations under any Transaction
      Document (any of (i), (ii) or (iii), a “Material
      Adverse Effect”;
      provided, however that changes in the trading price of the Common Stock shall
      not, in and of itself, constitute a Material Adverse Effect) and no Proceeding
      has been instituted in any such jurisdiction revoking, limiting or curtailing
      or
      seeking to revoke, limit or curtail such power and authority or
      qualification.

     

    (c) Authorization;
      Enforcement.
      The
      Company has the requisite corporate power and authority to enter into and to
      consummate the transactions contemplated by each of the Transaction Documents
      and otherwise to carry out its obligations hereunder and thereunder. The
      execution and delivery of each of the Transaction Documents by the Company
      and
      the consummation by it of the transactions contemplated hereby and thereby
      have
      been duly authorized by all necessary action on the part of the Company and
      no
      further action is required by the Company, the Board of Directors or the
      Company’s stockholders in connection therewith other than in connection with the
      Required Approvals. Each Transaction Document to which it is a party has been
      (or upon delivery will have been) duly executed by the Company and, when
      delivered in accordance with the terms hereof and thereof, will constitute
      the
      valid and binding obligation of the Company enforceable against the Company
      in
      accordance with its terms, except (i) as limited by general equitable principles
      and applicable bankruptcy, insolvency, reorganization, moratorium and other
      laws
      of general application affecting enforcement of creditors’ rights generally,
      (ii) as limited by laws relating to the availability of specific performance,
      injunctive relief or other equitable remedies and (iii) insofar as
      indemnification and contribution provisions may be limited by applicable
      law.

     

    
      
        
        

      

      
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    (d) No
      Conflicts.
      The
      execution, delivery and performance of the Transaction Documents by the Company,
      the issuance and sale of the Securities and the consummation by the Company
      of
      the other transactions contemplated hereby and thereby do not and will not
      (i)
      conflict with or violate any provision of the Company’s or any Subsidiary’s
      certificate or articles of incorporation, bylaws or other organizational or
      charter documents, or (ii) conflict with, or constitute a default (or an event
      that with notice or lapse of time or both would become a default) under, result
      in the creation of any material Lien upon any of the properties or assets of
      the
      Company or any Subsidiary, or give to others any rights of termination,
      amendment, acceleration or cancellation (with or without notice, lapse of time
      or both) of, any agreement, credit facility, debt or other instrument
      (evidencing a Company or Subsidiary debt or otherwise) or other understanding
      to
      which the Company or any Subsidiary is a party or by which any property or
      asset
      of the Company or any Subsidiary is bound or affected, or (iii) subject to
      receipt of the Required Approvals, conflict with or result in a violation of
      any
      law, rule, regulation, order, judgment, injunction, decree or other restriction
      of any court or governmental authority to which the Company or a Subsidiary
      is
      subject (including federal and state securities laws and regulations), or by
      which any property or asset of the Company or a Subsidiary is bound or affected;
      except in the case of each of clauses (ii) and (iii), such as could not have
      or
      reasonably be expected to result in a Material Adverse Effect.

     

    (e) Filings,
      Consents and Approvals.
      The
      Company is not required to obtain any consent, waiver, authorization or order
      of, give any notice to, or make any filing or registration with, any court
      or
      other federal, state, local or other governmental authority or other Person
      in
      connection with the execution, delivery and performance by the Company of the
      Transaction Documents, other than: (i) the filings required pursuant to Section
      4.4 of this Agreement, (ii) the filing with the Commission of the Prospectus
      Supplement, (iii) application(s) to each applicable Trading Market for the
      listing of the Securities for trading thereon in the time and manner required
      thereby and (iv) such filings as are required to be made under applicable state
      securities laws (collectively, the “Required
      Approvals”).

     

    
      
        
        

      

      
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    (f) Issuance
      of the Securities; Registration.
      The
      Securities are duly authorized and, when issued and paid for in accordance
      with
      the applicable Transaction Documents, will be duly and validly issued, fully
      paid and nonassessable, free and clear of all Liens imposed by the Company
      other
      than restrictions on transfer provided for in the Transaction Documents. The
      Warrant Shares, when issued in accordance with the terms of the Warrants, will
      be validly issued, fully paid and nonassessable, free and clear of all Liens
      imposed by the Company other than restrictions on transfer provided for in
      the
      Transaction Documents. The Company has reserved from its duly authorized capital
      stock the maximum number of shares of Common Stock issuable pursuant to this
      Agreement and the Warrants. The Company has prepared and filed the Registration
      Statement in conformity with the requirements of the Securities Act, which
      became effective on April 8, 2008 (the “Effective
      Date”),
      including the Prospectus, and such amendments and supplements thereto as may
      have been required to the date of this Agreement. The Registration Statement
      is
      effective under the Securities Act and no stop order preventing or suspending
      the effectiveness of the Registration Statement or suspending or preventing
      the
      use of the Prospectus has been issued by the Commission and no proceedings
      for
      that purpose have been instituted or, to the knowledge of the Company, are
      threatened by the Commission. The Company, if required by the rules and
      regulations of the Commission, proposes to file a Prospectus supplement, with
      the SEC pursuant to Rule 424(b). At the time the Registration Statement and
      any
      amendments thereto became effective, at the date of this Agreement and at the
      Closing Date, the Registration Statement and any amendments thereto conformed
      and will conform in all material respects to the requirements of the Securities
      Act and did not and will not contain any untrue statement of a material fact
      or
      omit to state any material fact required to be stated therein or necessary
      to
      make the statements therein not misleading; and the Prospectus and any
      amendments or supplements thereto, at time the Prospectus or any amendment
      or
      supplement thereto was issued and at the Closing Date, conformed and will
      conform in all material respects to the requirements of the Securities Act
      and
      did not and will not contain an untrue statement of a material fact or omit
      to
      state a material fact necessary in order to make the statements therein, in
      light of the circumstances under which they were made, not
      misleading.

     

    (g) Capitalization.
      Except
      as provided on Schedule
      3.1(g),
      the
      capitalization of the Company is as described in the SEC Reports. Schedule
      3.1(g)
      also
      lists the number of shares of Common Stock owned beneficially, and of record,
      by
      each executive officer and director of the Company as of the date hereof. The
      Company has not issued any capital stock since its most
      recently filed periodic report under the Exchange Act, other
      than pursuant to the exercise of employee stock options under the Company’s
      stock option plans, the issuance of shares of Common Stock to employees pursuant
      to the Company’s employee stock purchase plans and pursuant to the conversion or
      exercise of Common Stock Equivalents outstanding as of the date of the most
      recently filed periodic report under the Exchange Act. No Person has any right
      of first refusal, preemptive right, right of participation, or any similar
      right
      to participate in the transactions contemplated by the Transaction Documents.
      Except as a result of the purchase and sale of the Securities or as disclosed
      in
      the SEC Reports, there are no outstanding options, warrants, scrip rights to
      subscribe to, calls or commitments of any character whatsoever relating to,
      or
      securities, rights or obligations convertible into or exercisable or
      exchangeable for, or giving any Person any right to subscribe for or acquire,
      any shares of Common Stock, or contracts, commitments, understandings or
      arrangements by which the Company or any Subsidiary is or may become bound
      to
      issue additional shares of Common Stock or Common Stock Equivalents. The
      issuance and sale of the Securities will not obligate the Company to issue
      shares of Common Stock or other securities to any Person (other than the
      Purchasers) and will not result in a right of any holder of Company securities
      to adjust the exercise, conversion, exchange or reset price under any of such
      securities. All of the outstanding shares of capital stock of the Company are
      validly issued, fully paid and nonassessable, have been issued in compliance
      with all federal and state securities laws, and none of such outstanding shares
      was issued in violation of any preemptive rights or similar rights to subscribe
      for or purchase securities. No further approval or authorization of any
      stockholder, the Board of Directors or others is required for the issuance
      and
      sale of the Securities. There are no stockholders agreements, voting agreements
      or other similar agreements with respect to the Company’s capital stock to which
      the Company is a party or, to the knowledge of the Company, between or among
      any
      of the Company’s stockholders.

     

    
      
        
        

      

      
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    (h) SEC
      Reports; Financial Statements.
      The
      Company has filed all reports, schedules, forms, statements and other documents
      required to be filed by the Company under the Securities Act and the Exchange
      Act, including pursuant to Section 13(a) or 15(d) thereof, for the two years
      preceding the date hereof (or such shorter period as the Company was required
      by
      law or regulation to file such material) (the foregoing materials, including
      the
      exhibits thereto and documents incorporated by reference therein, together
      with
      the Prospectus and the Prospectus Supplement, being collectively referred to
      herein as the “SEC
      Reports”)
      on a
      timely basis or has received a valid extension of such time of filing and has
      filed any such SEC Reports prior to the expiration of any such extension. As
      of
      their respective dates, the SEC Reports complied in all material respects with
      the requirements of the Securities Act and the Exchange Act, as applicable,
      and
      none of the SEC Reports, when filed, contained any untrue statement of a
      material fact or omitted to state a material fact required to be stated therein
      or necessary in order to make the statements therein, in the light of the
      circumstances under which they were made, not misleading. The Company has never
      been an issuer subject to Rule 144(i) under the Securities Act. The financial
      statements of the Company included in the SEC Reports comply in all material
      respects with applicable accounting requirements and the rules and regulations
      of the Commission with respect thereto as in effect at the time of filing.
      Such
      financial statements have been prepared in accordance with United States
      generally accepted accounting principles applied on a consistent basis during
      the periods involved (“GAAP”),
      except as may be otherwise specified in such financial statements or the notes
      thereto and except that unaudited financial statements may not contain all
      footnotes required by GAAP, and fairly present in all material respects the
      financial position of the Company and its consolidated subsidiaries as of and
      for the dates thereof and the results of operations and cash flows for the
      periods then ended, subject, in the case of unaudited statements, to normal,
      immaterial, year-end audit adjustments.

     

    (i) Material
      Changes; Undisclosed Events, Liabilities or Developments.
      Since
      the date of the latest audited financial statements included within the SEC
      Reports, except as specifically disclosed in a subsequent SEC Report filed
      prior
      to the date hereof, (i) there has been no event, occurrence or development
      that
      has had or that could reasonably be expected to result in a Material Adverse
      Effect, (ii) the Company has not incurred any liabilities (contingent or
      otherwise) other than (A) trade payables and accrued expenses incurred in the
      ordinary course of business consistent with past practice and (B) liabilities
      not required to be reflected in the Company’s financial statements pursuant to
      GAAP or disclosed in filings made with the Commission, (iii) the Company has
      not
      altered its method of accounting, (iv) the Company has not declared or made
      any
      dividend or distribution of cash or other property to its stockholders or
      purchased, redeemed or made any agreements to purchase or redeem any shares
      of
      its capital stock and (v) the Company has not issued any equity securities
      to
      any officer, director or Affiliate, except pursuant to existing Company stock
      option plans. The Company does not have pending before the Commission any
      request for confidential treatment of information. Except for the issuance
      of
      the Securities contemplated by this Agreement or as set forth on Schedule
      3.1(i),
      no
      event, liability or development has occurred or exists with respect to the
      Company or its Subsidiaries or their respective business, properties, operations
      or financial condition, that would be required to be disclosed by the Company
      under applicable securities laws at the time this representation is made or
      deemed made that has not been publicly disclosed at least 1 Trading Day prior
      to
      the date that this representation is made.

     

    
      
        
        

      

      
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    (j) Litigation.
      Except
      as set forth in the SEC Reports, there is no action, suit, inquiry, notice
      of
      violation, proceeding or investigation pending or, to the knowledge of the
      Company, threatened in writing against or affecting the Company, any Subsidiary
      or any of their respective properties before or by any court, arbitrator,
      governmental or administrative agency or regulatory authority (federal, state,
      county, local or foreign) (collectively, an “Action”)
      which
      (i) adversely affects or challenges the legality, validity or enforceability
      of
      any of the Transaction Documents or the Securities or (ii) could, if there
      were
      an unfavorable decision, have or reasonably be expected to result in a Material
      Adverse Effect. Neither the Company nor any Subsidiary, nor, to the Company’s
      knowledge, any director or officer thereof (in his or her capacity as such),
      is
      or has been the subject of any Action involving a claim of violation of or
      liability under federal or state securities laws or a claim of breach of
      fiduciary duty. There has not been, and to the knowledge of the Company, there
      is not pending or contemplated, any investigation by the Commission involving
      the Company or any current or former director or officer of the Company (in
      his
      or her capacity as such). The Commission has not issued any stop order or other
      order suspending the effectiveness of any registration statement filed by the
      Company or any Subsidiary under the Exchange Act or the Securities Act.

     

    (k) Labor
      Relations.
      No
      material labor dispute exists or, to the knowledge of the Company, is imminent
      with respect to any of the employees of the Company which could reasonably
      be
      expected to result in a Material Adverse Effect. None of the Company’s or its
      Subsidiaries’ employees is a member of a union that relates to such employee’s
      relationship with the Company or such Subsidiary, and neither the Company nor
      any of its Subsidiaries is a party to a collective bargaining agreement, and
      the
      Company and its Subsidiaries believe that their relationships with their
      employees are good. No executive officer, to the knowledge of the Company,
      is,
      or is now expected to be, in violation of any material term of any employment
      contract, confidentiality, disclosure or proprietary information agreement
      or
      non-competition agreement, or any other contract or agreement or any restrictive
      covenant in favor of any third party, and the continued employment of each
      such
      executive officer does not subject the Company or any of its Subsidiaries to
      any
      liability with respect to any of the foregoing matters. The Company and its
      Subsidiaries are in compliance with all U.S. federal, state, local and foreign
      laws and regulations relating to employment and employment practices, terms
      and
      conditions of employment and wages and hours, except where the failure to be
      in
      compliance could not, individually or in the aggregate, reasonably be expected
      to have a Material Adverse Effect.

     

    (l) Compliance.
      Except
      as set forth in the SEC Reports, neither the Company nor any Subsidiary (i)
      is
      in default under or in violation of (and no event has occurred that has not
      been
      waived that, with notice or lapse of time or both, would result in a default
      by
      the Company or any Subsidiary under), nor has the Company or any Subsidiary
      received notice of a claim that it is in default under or that it is in
      violation of, any material indenture, loan or credit agreement or any other
      material agreement or instrument to which it is a party or by which it or any
      of
      its material properties is bound (whether or not such default or violation
      has
      been waived), (ii) is in violation of any order of any court, arbitrator or
      governmental body, or (iii) is or has been in violation of any statute, rule
      or
      regulation of any governmental authority, including without limitation all
      foreign, federal, state and local laws applicable to its business and all such
      laws that affect the environment, except in each case as could not have or
      reasonably be expected to result in a Material Adverse Effect.

     

    
      
        
        

      

      
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    (m) Regulatory
      Permits.
      The
      Company and the Subsidiaries possess all certificates, authorizations and
      permits issued by the appropriate federal, state, local or foreign regulatory
      authorities necessary to conduct their respective businesses as described in
      the
      SEC Reports, except where the failure to possess such permits could not
      reasonably be expected to result in a Material Adverse Effect (“Material
      Permits”),
      and
      neither the Company nor any Subsidiary has received any notice of proceedings
      relating to the revocation or modification of any Material Permit.

     

    (n) Title
      to Assets.
      The
      Company and the Subsidiaries have good and marketable title in fee simple to
      all
      real property owned by them that is material to the business of the Company
      and
      the Subsidiaries and good and marketable title in all personal property owned
      by
      them that is material to the business of the Company and the Subsidiaries,
      in
      each case free and clear of all Liens, except for Liens as do not materially
      affect the value of such property and do not materially interfere with the
      use
      made and proposed to be made of such property by the Company and the
      Subsidiaries and Liens for the payment of federal, state or other taxes, the
      payment of which is neither delinquent nor subject to penalties. Any real
      property and facilities held under lease by the Company and the Subsidiaries
      are
      held by them under valid, subsisting and enforceable leases with which the
      Company and the Subsidiaries are in compliance.

     

    (o) Patents
      and Trademarks.
      Except
      as otherwise provided in the SEC Reports, the Company and the Subsidiaries
      have,
      or have rights to use, all patents, patent applications, trademarks, trademark
      applications, service marks, trade names, trade secrets, inventions, copyrights,
      licenses and other intellectual property rights and similar rights necessary
      or
      material for use in connection with their respective businesses as described
      in
      the SEC Reports and which the failure to so have could have a Material Adverse
      Effect (collectively, the “Intellectual
      Property Rights”).
      Except as set forth in the SEC Reports, neither the Company nor any Subsidiary
      has received a written notice that any of the Intellectual Property Rights
      used
      by the Company or any Subsidiary violates or infringes upon the rights of any
      Person. To the knowledge of the Company, all such Intellectual Property Rights
      are enforceable and there is no existing infringement by another Person of
      any
      of the Intellectual Property Rights. The Company and its Subsidiaries have
      taken
      reasonable security measures to protect the secrecy, confidentiality and value
      of all of their intellectual properties, except where failure to do so could
      not, individually or in the aggregate, reasonably be expected to have a Material
      Adverse Effect.

     

    (p) Insurance.
      The
      Company and the Subsidiaries are insured by insurers of recognized financial
      responsibility against such losses and risks and in such amounts as are prudent
      and customary in the businesses in which the Company and the Subsidiaries are
      engaged. Neither the Company nor any Subsidiary has any reason to believe that
      it will not be able to renew its existing insurance coverage as and when such
      coverage expires or to obtain similar coverage from similar insurers as may
      be
      necessary to continue its business without a significant increase in
      cost.

     

    
      
        
        

      

      
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    (q) Transactions
      With Affiliates and Employees.
      Except
      as set forth in the SEC Reports, none of the officers or directors of the
      Company and, to the knowledge of the Company, none of the employees of the
      Company is presently a party to any transaction with the Company or any
      Subsidiary (other than for services as employees, officers and directors),
      including any contract, agreement or other arrangement providing for the
      furnishing of services to or by, providing for rental of real or personal
      property to or from, or otherwise requiring payments to or from any officer,
      director or such employee or, to the knowledge of the Company, any entity in
      which any officer, director, or any such employee has a substantial interest
      or
      is an officer, director, trustee or partner, in each case in excess of $120,000
      other than for (i) payment of salary or consulting fees for services rendered,
      (ii) reimbursement for expenses incurred on behalf of the Company and (iii)
      other employee benefits, including stock option agreements under any stock
      option plan of the Company and restricted stock agreements under any restricted
      stock plan of the Company.

     

    (r) Sarbanes-Oxley;
      Internal Accounting Controls.
      Except
      as set forth in the SEC Reports, the Company is in material compliance with
      all
      provisions of the Sarbanes-Oxley Act of 2002 which are applicable to it as
      of
      the Closing Date. Except as set forth in the SEC Reports, the
      Company and the Subsidiaries maintain a system of internal accounting controls
      sufficient to provide reasonable assurance that: (i) transactions are executed
      in accordance with management’s general or specific authorizations, (ii)
      transactions are recorded as necessary to permit preparation of financial
      statements in conformity with GAAP and to maintain asset accountability, (iii)
      access to assets is permitted only in accordance with management’s general or
      specific authorization, and (iv) the recorded accountability for assets is
      compared with the existing assets at reasonable intervals and appropriate action
      is taken with respect to any differences. Except as set forth in the SEC
      Reports, the Company has established disclosure controls and procedures (as
      defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and
      designed such disclosure controls and procedures to ensure that information
      required to be disclosed by the Company in the reports it files or submits
      under
      the Exchange Act is recorded, processed, summarized and reported, within the
      time periods specified in the Commission’s rules and forms. The Company’s
      certifying officers have evaluated the effectiveness of the Company’s disclosure
      controls and procedures as of the end of the period covered by the Company’s
      most recently filed periodic report under the Exchange Act (such date, the
      “Evaluation
      Date”).
      The
      Company presented in its most recently filed periodic report under the Exchange
      Act the conclusions of the certifying officers about the effectiveness of the
      disclosure controls and procedures based on their evaluations as of the
      Evaluation Date. Since the Evaluation Date, there have been no changes in the
      Company’s internal control over financial reporting (as such term is defined in
      the Exchange Act) that has materially affected, or is reasonably likely to
      materially affect, the Company’s internal control over financial
      reporting.

     

    
      
        
        

      

      
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    (s) Certain
      Fees.
      Except
      as set forth in the Prospectus Supplement, no brokerage or finder’s fees or
      commissions are or will be payable by the Company to any broker, financial
      advisor or consultant, finder, placement agent, investment banker, bank or
      other
      Person with respect to the transactions contemplated by the Transaction
      Documents. The Purchasers shall have no obligation with respect to any fees
      or
      with respect to any claims (other than such fees or commissions owed by a
      Purchaser pursuant to agreements entered into by such Purchaser, which fees
      or
      commissions shall be the sole responsibility of such Purchaser) made by or
      on
      behalf of other Persons for fees of a type contemplated in this Section that
      may
      be due in connection with the transactions contemplated by the Transaction
      Documents due to an arrangement or agreement made by the Company.

     

    (t) Investment
      Company.
      The
      Company is not, and is not an Affiliate of, and immediately after receipt of
      payment for the Securities, will not be or be an Affiliate of, an “investment
      company” within the meaning of the Investment Company Act of 1940, as amended.
      The Company shall conduct its business in a manner so that it will not become
      subject to the Investment Company Act of 1940, as amended.

     

    (u) Registration
      Rights.
      Except
      as provided in Schedule
      3.1(u),
      no
      Person has any right to cause the Company to effect the registration under
      the
      Securities Act of any securities of the Company.

     

    (v) Listing
      and Maintenance Requirements.
      The
      Common Stock is registered pursuant to Section 12(b) or 12(g) of the Exchange
      Act, and the Company has taken no action designed to, or which to its knowledge
      is likely to have the effect of, terminating the registration of the Common
      Stock under the Exchange Act nor has the Company received any notification
      that
      the Commission is contemplating terminating such registration. The Company
      has
      not, in the 12 months preceding the date hereof, received notice from any
      Trading Market on which the Common Stock is or has been listed or quoted to
      the
      effect that the Company is not in compliance with the listing or maintenance
      requirements of such Trading Market. The Company is, and has no reason to
      believe that it will not in the foreseeable future continue to be, in compliance
      with all such listing and maintenance requirements.

     

    (w) Application
      of Takeover Protections.
      The
      Company and the Board of Directors have taken all necessary action, if any,
      in
      order to render inapplicable any control share acquisition, business
      combination, poison pill (including any distribution under a rights agreement)
      or other similar anti-takeover provision under the Company’s articles of
      incorporation (or similar charter documents) or the laws of its state of
      incorporation that is or could become applicable to the Purchasers as a result
      of the Purchasers and the Company fulfilling their obligations or exercising
      their rights under the Transaction Documents, including without limitation
      as a
      result of the Company’s issuance of the Securities and the Purchasers’ ownership
      of the Securities.

     

    
      
        
        

      

      
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    (x) Disclosure.
      Except
      with respect to the material terms and conditions of the transactions
      contemplated by the Transaction Documents, the Company confirms that neither
      it
      nor any other Person acting on its behalf has provided any of the Purchasers
      or
      their agents or counsel with any information that it believes constitutes
      material, non-public information which is not otherwise disclosed in the
      Prospectus Supplement. The Company understands and confirms that the Purchasers
      will rely on the foregoing representation in effecting transactions in
      securities of the Company. All written disclosure furnished by or on behalf
      of
      the Company to the Purchasers regarding the Company, its business and the
      transactions contemplated hereby, including the Disclosure Schedules to this
      Agreement, is true and correct and does not contain any untrue statement of
      a
      material fact or omit to state any material fact necessary in order to make
      the
      statements made therein, in light of the circumstances under which they were
      made, not misleading. The press releases disseminated by the Company during
      the
      twelve months preceding the date of this Agreement taken as a whole do not
      contain any untrue statement of a material fact or omit to state a material
      fact
      required to be stated therein or necessary in order to make the statements
      therein, in light of the circumstances under which they were made and when
      made,
      not misleading. The Company acknowledges and agrees that no Purchaser makes
      or
      has made any representations or warranties with respect to the transactions
      contemplated hereby other than those specifically set forth in Section 3.2
      hereof.

     

    (y) No
      Integrated Offering.
      Assuming
      the accuracy of the Purchasers’ representations and warranties set forth in
      Section 3.2, neither the Company, nor any of its Affiliates, nor to the
      Company’s knowledge, any Person acting on its or their behalf has, directly or
      indirectly, made any offers or sales of any security or solicited any offers
      to
      buy any security, under circumstances that would cause this offering of the
      Securities to be integrated with prior offerings by the Company for purposes
      of
      any applicable shareholder approval provisions of any Trading Market on which
      any of the securities of the Company are listed or designated.

     

    (z) Solvency.
      Based
      on the consolidated financial condition of the Company as of the Closing Date,
      after giving effect to the receipt by the Company of the proceeds from the
      sale
      of the Securities hereunder, (i) the fair saleable value of the Company’s assets
      exceeds the amount that will be required to be paid on or in respect of the
      Company’s existing debts and other liabilities (including known contingent
      liabilities) as they mature; (ii) the Company’s assets do not constitute
      unreasonably small capital to carry on its business as now conducted and as
      proposed to be conducted including its capital needs taking into account the
      particular capital requirements of the business conducted by the Company, and
      currently planned capital requirements and capital availability thereof; and
      (iii) the current cash flow of the Company, together with the proceeds the
      Company would receive, were it to liquidate all of its assets, would be
      sufficient to pay all amounts on or in respect of its liabilities when such
      amounts are required to be paid. The Company does not intend to incur debts
      beyond its ability to pay such debts as they mature (taking into account the
      timing and amounts of cash to be payable on or in respect of its debt). The
      Company has no knowledge of any facts or circumstances which lead it to believe
      that it will file for reorganization or liquidation under the bankruptcy or
      reorganization laws of any jurisdiction within one year from the Closing Date.
      Except as set forth in the SEC Reports or on Schedule
      3.1(z),
      the
      Company has not incurred or guaranteed, suffered to exist or is otherwise liable
      for any Indebtedness. For the purposes of this Agreement, “Indebtedness”
means
      (a) any liabilities for borrowed money or amounts owed in excess of $50,000
      (other than trade accounts payable incurred in the ordinary course of business),
      (b) all guaranties, endorsements and other known contingent obligations in
      respect of Indebtedness of others, whether or not the same are or should be
      reflected in the Company’s balance sheet (or the notes thereto), except
      guaranties by endorsement of negotiable instruments for deposit or collection
      or
      similar transactions in the ordinary course of business; and (c) the present
      value of any lease payments in excess of $50,000 due under leases required
      to be
      capitalized in accordance with GAAP. Neither the Company nor any Subsidiary
      is
      in default with respect to any Indebtedness.

     

    
      
        
        

      

      
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    (aa) Tax
      Status.
      Except
      for matters that would not, individually or in the aggregate, have or reasonably
      be expected to result in a Material Adverse Effect, the Company and each
      Subsidiary has filed all necessary federal, state and foreign income and
      franchise tax returns and has paid or accrued all taxes shown as due thereon,
      and the Company has no knowledge of a tax deficiency which has been asserted
      or
      threatened against the Company or any Subsidiary.

     

    (bb) Foreign
      Corrupt Practices.
      Neither
      the Company, nor to the knowledge of the Company, any agent or other person
      acting on behalf of the Company, has (i) directly or indirectly, used any funds
      for unlawful contributions, gifts, entertainment or other unlawful expenses
      related to foreign or domestic political activity, (ii) made any unlawful
      payment to foreign or domestic government officials or employees or to any
      foreign or domestic political parties or campaigns from corporate funds, (iii)
      failed to disclose fully any contribution made by the Company (or made by any
      person acting on its behalf of which the Company is aware) which is in violation
      of law, or (iv) violated in any material respect any provision of the Foreign
      Corrupt Practices Act of 1977, as amended.

     

    (cc) Accountants.
      The
      Company’s accounting firm is set forth on Schedule
      3.1(cc)
      of the
      Disclosure Schedules. To the knowledge and belief of the Company, such
      accounting firm (i) is a registered public accounting firm as required by the
      Exchange Act and (ii) shall provide an unqualified report with respect to the
      financial statements to be included in the Company’s Annual Report for the year
      ending December 31, 2008. 

     

    (dd)  Acknowledgment
      Regarding Purchasers’ Purchase of Securities.
      The
      Company acknowledges and agrees that each of the Purchasers is acting solely
      in
      the capacity of an arm’s length purchaser with respect to the Transaction
      Documents and the transactions contemplated thereby. The Company further
      acknowledges that no Purchaser is acting as a financial advisor or fiduciary
      of
      the Company (or in any similar capacity) with respect to the Transaction
      Documents and the transactions contemplated thereby and any advice given by
      any
      Purchaser or any of their respective representatives or agents in connection
      with the Transaction Documents and the transactions contemplated thereby is
      merely incidental to the Purchasers’ purchase of the Securities. The Company
      further represents to each Purchaser that the Company’s decision to enter into
      this Agreement and the other Transaction Documents has been based solely on
      the
      independent evaluation of the transactions contemplated hereby by the Company
      and its representatives.

     

    
      
        
        

      

      
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    (ee) Acknowledgement
      Regarding Purchaser’s Trading Activity.
      Anything
      in this Agreement or elsewhere herein to the contrary notwithstanding (except
      for Sections 3.2(e) and 4.14 hereof), it is understood and acknowledged by
      the
      Company that: (i) none of the Purchasers have been asked by the Company to
      agree, nor has any Purchaser agreed, to desist from purchasing or selling,
      long
      and/or short, securities of the Company, or “derivative” securities based on
      securities issued by the Company or to hold the Securities for any specified
      term; (ii) that past or future open market or other transactions by any
      Purchaser, specifically including, without limitation, Short Sales or
“derivative” transactions, before or after the closing of this or future private
      placement transactions, may negatively impact the market price of the Company’s
      publicly-traded securities; (iii) that any Purchaser, and counter-parties in
      “derivative” transactions to which any such Purchaser is a party, directly or
      indirectly, presently may have a “short” position in the Common Stock unless
      represented otherwise by a Purchaser herein, and (iv) that each Purchaser shall
      not be deemed to have any affiliation with or control over any arm’s length
      counter-party in any “derivative” transaction. The
      Company further understands and acknowledges that (y) one or more Purchasers
      may
      engage in hedging activities at various times during the period that the
      Securities are outstanding, including, without limitation, during the periods
      that the value of the Warrant Shares deliverable with respect to Securities
      are
      being determined, and (z) such hedging activities (if any) could reduce the
      value of the existing stockholders' equity interests in the Company at and
      after
      the time that the hedging activities are being conducted.  The Company
      acknowledges that such aforementioned hedging activities do not constitute
      a
      breach of any of the Transaction Documents.

     

    (ff) Regulation
      M Compliance. 
      The Company has not, and to its knowledge no one acting on its behalf has,
      (i)
      taken, directly or indirectly, any action designed to cause or to result in
      the
      stabilization or manipulation of the price of any security of the Company to
      facilitate the sale or resale of any of the Securities, (ii) sold, bid for,
      purchased, or, paid any compensation for soliciting purchases of, any of the
      Securities, or (iii) paid or agreed to pay to any Person any compensation for
      soliciting another to purchase any other securities of the Company, other than,
      in the case of clauses (ii) and (iii), compensation paid to the Company’s
      placement agent in connection with the placement of the Securities.

     

    3.2 Representations
      and Warranties of the Purchasers. Each Purchaser, for itself and for no
      other Purchaser, hereby represents and warrants as of the date hereof and as
      of
      the Closing Date to the Company as follows:

     

    (a) Organization;
      Authority.
      Such
      Purchaser is an entity duly organized, validly existing and in good standing
      under the laws of the jurisdiction of its organization with full right,
      corporate or partnership power and authority to enter into and to consummate
      the
      transactions contemplated by this Agreement and otherwise to carry out its
      obligations hereunder and thereunder. The execution and delivery of this
      Agreement and the Warrant and performance by such Purchaser of the transactions
      contemplated by this Agreement and the Warrant have been duly authorized by
      all
      necessary corporate or similar action on the part of such Purchaser. Each
      Transaction Document to which it is a party has been duly executed by such
      Purchaser, and when delivered by such Purchaser in accordance with the terms
      hereof, will constitute the valid and legally binding obligation of such
      Purchaser, enforceable against it in accordance with its terms, except: (i)
      as
      limited by general equitable principles and applicable bankruptcy, insolvency,
      reorganization, moratorium and other laws of general application affecting
      enforcement of creditors’ rights generally, (ii) as limited by laws relating to
      the availability of specific performance, injunctive relief or other equitable
      remedies and (iii) insofar as indemnification and contribution provisions may
      be
      limited by applicable law.

     

    
      
        
        

      

      
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    (b) Own
      Account.
      Such
      Purchaser is acquiring the Securities as principal for its own account and
      not
      with a view to or for distributing or reselling such Securities or any part
      thereof in violation of the Securities Act or any applicable state securities
      law, has no present intention of distributing any of such Securities in
      violation of the Securities Act or any applicable state securities law and
      has
      no direct or indirect arrangement or understandings with any other persons
      to
      distribute or regarding the distribution of such Securities (this representation
      and warranty not limiting such Purchaser’s right to sell the Securities pursuant
      to the Registration Statement or otherwise in compliance with applicable federal
      and state securities laws) in violation of the Securities Act or any applicable
      state securities law. Such Purchaser is acquiring the Securities hereunder
      in
      the ordinary course of its business.

     

    (c) Purchaser
      Status.
      At the
      time such Purchaser was offered the Securities, it was, and as of the date
      hereof it is, and on each date on which it exercises any Warrants, it will
      be a
“qualified institutional buyer” as defined in Rule 144A(a) under the Securities
      Act. Additionally, each Purchaser located in one of the states set forth on
      Exhibit
      3.2(c)
      meets
      the applicable definition of “institutional investor” or similar term, as set
      forth therein. Such Purchaser is not required to be registered as a
      broker-dealer under Section 15 of the Exchange Act. 

     

    (d) Experience
      of Such Purchaser.
      Such
      Purchaser, either alone or together with its representatives, has such
      knowledge, sophistication and experience in business and financial matters
      so as
      to be capable of evaluating the merits and risks of the prospective investment
      in the Securities, and has so evaluated the merits and risks of such investment.
      Such Purchaser is able to bear the economic risk of an investment in the
      Securities and, at the present time, is able to afford a complete loss of such
      investment.

     

    (e) Short
      Sales and Confidentiality Prior To The Date Hereof.
      Other
      than consummating the transactions contemplated hereunder, such Purchaser has
      not directly or indirectly, nor has any Person acting on behalf of or pursuant
      to any understanding with such Purchaser, directly or indirectly executed any
      purchases or sales, including Short Sales, of the securities of the Company
      during the period commencing from the time that such Purchaser first received
      a
      term sheet (written or oral) from the Company or any other Person representing
      the Company setting forth the material terms of the transactions contemplated
      hereunder (“Discussion
      Time”).
      Notwithstanding the foregoing, in the case of a Purchaser that is a
      multi-managed investment vehicle whereby separate portfolio managers manage
      separate portions of such Purchaser’s assets and the portfolio managers have no
      direct or indirect knowledge of the investment decisions made by the portfolio
      managers managing other portions of such Purchaser’s assets, the representation
      set forth above shall only apply with respect to the portion of assets managed
      by the portfolio manager that made the investment decision to purchase the
      Securities covered by this Agreement. Other than to other Persons party to
      this
      Agreement, such Purchaser has maintained the confidentiality of all disclosures
      made to it in connection with this transaction (including the existence and
      terms of this transaction).

     

    
      
        
        

      

      
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    ARTICLE
      IV.

    OTHER
      AGREEMENTS OF THE PARTIES

     

    4.1 Warrant
      Shares. If
      all or
      any portion of a Warrant is exercised at a time when there is an effective
      registration statement to cover the issuance or resale of the Warrant Shares
      or
      if the Warrant is exercised via cashless exercise and the Warrant Shares issued
      are eligible for immediate resale under Rule 144, the Warrant Shares issued
      pursuant to any such exercise shall be issued free of all legends. If at any
      time following the date hereof the Registration Statement (or any subsequent
      registration statement registering the Warrant Shares) is not effective or
      is
      not otherwise available for the sale or resale of the Warrant Shares, the
      Company shall immediately notify the holders of the Warrants in writing that
      such registration statement is not then effective and thereafter shall promptly
      notify such holders when the registration statement is effective again and
      available for the sale or resale of the Warrant Shares. The Company shall use
      best efforts to keep a registration statement (including the Registration
      Statement) registering the issuance or resale of the Warrant Shares effective
      during the term of the Warrants. Upon a cashless exercise of the Warrants,
      the
      holding period for purposes of Rule 144 shall tack back to the original date
      of
      issuance of such Warrant if such tacking is allowed by the rules and
      interpretations of the Commission at such time.

     

    4.2 Furnishing
      of Information. Until the earliest of the time that (i) no Purchaser owns
      Securities or (ii) the Warrants have expired, the Company covenants to timely
      file (or obtain extensions in respect thereof and file within the applicable
      grace period) all reports required to be filed by the Company after the date
      hereof pursuant to the Exchange Act even if the Company is not then subject
      to
      the reporting requirements of the Exchange Act. As long as any Purchaser owns
      Securities, if the Company is not required to file reports pursuant to the
      Exchange Act, it will prepare and furnish to the Purchasers, at their request,
      and make publicly available in accordance with Rule 144(c) such information
      as
      is required for the Purchasers to sell the Securities under Rule 144. The
      Company further covenants that it will take such further action as any holder
      of
      Securities may reasonably request, to the extent required from time to time
      to
      enable such Person to sell such Securities without registration under the
      Securities Act within the requirements of the exemption provided by Rule
      144.

     

    4.3 Integration.
      The Company shall not sell, offer for sale or solicit offers to buy or otherwise
      negotiate in respect of any security (as defined in Section 2 of the Securities
      Act) that would be integrated with the offer or sale of the Securities for
      purposes of the rules and regulations of any Trading Market such that it would
      require shareholder approval prior to the closing of such other transaction
      unless shareholder approval is obtained before the closing of such subsequent
      transaction.

     

    4.4 Securities
      Laws Disclosure; Publicity. The Company shall, (a) by 8:30 a.m. (New York
      City time) on the Trading Day immediately following the date hereof, issue
      a
      press release describing the material terms of the transactions contemplated
      hereby, and (b) no later than the fourth Trading Day following the date of
      this
      Agreement, file with the Commission a Current Report on Form 8-K, disclosing
      the
      material terms of the transactions contemplated hereby, and including the
      Transaction Documents as exhibits thereto. The Company shall not publicly
      disclose the name of any Purchaser, or include the name of any Purchaser in
      any
      filing with the Commission or any regulatory agency or Trading Market, without
      the prior written consent of such Purchaser, except (a) as required by federal
      securities law in connection with the filing of final Transaction Documents
      (including signature pages thereto) with the Commission and (b) to the extent
      such disclosure is required by law or Trading Market regulations, in which
      case
      the Company shall provide the applicable Purchasers with prior notice of such
      disclosure permitted under this clause (b).

     

    
      
        
        

      

      
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    4.5 Shareholder
      Rights Plan. No claim will be made or enforced by the Company or, with the
      express consent of the Company, any other Person, that any Purchaser is an
      “Acquiring Person” under any control share acquisition, business combination,
      poison pill (including any distribution under a rights agreement) or similar
      anti-takeover plan or arrangement in effect or hereafter adopted by the Company,
      or that any Purchaser could be deemed to trigger the provisions of any such
      plan
      or arrangement, by virtue of receiving Securities under the Transaction
      Documents or under any other agreement between the Company and the
      Purchasers.

     

    4.6 Non-Public
      Information. Except with respect to the material terms and conditions of the
      transactions contemplated by the Transaction Documents, the Company covenants
      and agrees that neither it, nor any other Person acting on its behalf will
      provide any Purchaser or its agents or counsel with any information that the
      Company believes constitutes material non-public information, unless prior
      thereto such Purchaser shall have executed a written agreement regarding the
      confidentiality and use of such information. The Company understands and
      confirms that each Purchaser shall be relying on the foregoing covenant in
      effecting transactions in securities of the Company.

     

    4.7 Use
      of
      Proceeds. Except for payment of (i) attorney’s fees, (ii) fees incurred in
      connection with the transactions contemplated by the Transaction Documents,
      (iii) amounts for the construction of new facilities, capital improvements
      and
      acquisitions and as otherwise set forth on Schedule 4.7 attached hereto,
      the Company shall use the net proceeds from the sale of the Securities hereunder
      for working capital purposes.

     

    
      
        
        

      

      
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    4.8 Indemnification
      of Purchasers. Subject to the provisions of this Section 4.8, the Company
      will indemnify and hold each Purchaser and its directors, officers,
      shareholders, members, partners, employees and agents (and any other Persons
      with a functionally equivalent role of a Person holding such titles
      notwithstanding a lack of such title or any other title), each Person who
      controls such Purchaser (within the meaning of Section 15 of the Securities
      Act
      and Section 20 of the Exchange Act), and the directors, officers, shareholders,
      agents, members, partners or employees (and any other Persons with a
      functionally equivalent role of a Person holding such titles notwithstanding
      a
      lack of such title or any other title) of such controlling persons (each, a
      “Purchaser Party”) harmless from any and all losses, liabilities,
      obligations, claims, contingencies, damages, costs and expenses, including
      all
      judgments, amounts paid in settlements, court costs and reasonable attorneys’
fees and costs of investigation that any such Purchaser Party may suffer or
      incur as a result of or relating to any breach of any of the representations,
      warranties, or material breach of any of the covenants or agreements made by
      the
      Company in this Agreement or in the other Transaction Documents. If any action
      shall be brought against any Purchaser Party in respect of which indemnity
      may
      be sought pursuant to this Agreement, such Purchaser Party shall promptly notify
      the Company in writing, and the Company shall have the right to assume the
      defense thereof with counsel of its own choosing reasonably acceptable to the
      Purchaser Party. To the extent that a Purchaser Party fails to provide timely
      notice of a claim for indemnity under this Section 4.8, and such failure
      materially prejudices the Company’s ability to defend against such claim, then
      the Company shall have no obligation under this Section 4.8 to indemnify
      the Purchaser Party for the claim (or portion thereof) that was so affected.
      Any
      Purchaser Party shall have the right to employ separate counsel in any such
      action and participate in the defense thereof, but the fees and expenses of
      such
      counsel shall be at the expense of such Purchaser Party except to the extent
      that (i) the employment thereof has been specifically authorized by the Company
      in writing, (ii) the Company has failed after a reasonable period of time to
      assume such defense and to employ counsel or (iii) in such action there is,
      in
      the reasonable opinion of such separate counsel, a material conflict on any
      material issue between the position of the Company and the position of such
      Purchaser Party, in which case the Company shall be responsible for the
      reasonable fees and expenses of no more than one such separate counsel. The
      Company will not be liable to any Purchaser Party under this Agreement (y)
      for
      any settlement by a Purchaser Party effected without the Company’s prior written
      consent, which shall not be unreasonably withheld or delayed; or (z) to the
      extent, but only to the extent that a loss, claim, damage or liability is
      attributable to any Purchaser Party’s breach of any of the representations,
      warranties, covenants or agreements made by such Purchaser Party in this
      Agreement or in the other Transaction Documents.

     

    4.9 Reservation
      of Common Stock. As of the date hereof, the Company has reserved and the
      Company shall continue to reserve and keep available at all times, free of
      preemptive rights, a sufficient number of shares of Common Stock for the purpose
      of enabling the Company to issue Shares pursuant to this Agreement and Warrant
      Shares pursuant to any exercise of the Warrants. 

     

    4.10 Listing
      of Common Stock. The
      Company hereby agrees to use best efforts to maintain the listing of the Common
      Stock on a Trading Market, and as soon as reasonably practicable following
      the
      Closing (but not later than the Closing Date) to list all of the Shares and
      Warrant Shares on such Trading Market. The Company further agrees, if the
      Company applies to have the Common Stock traded on any other Trading Market,
      it
      will then include in such application all of the Shares and Warrant Shares,
      and
      will take such other action as is necessary to cause all of the Shares and
      Warrant Shares to be listed on such other Trading Market as promptly as
      possible. The Company will then take all action reasonably necessary to continue
      the listing and trading of its Common Stock on a Trading Market and will comply
      in all material respects with the Company’s reporting, filing and other
      obligations under the bylaws or rules of the Trading Market.

     

    4.11 Equal
      Treatment of Purchasers. No consideration shall be offered or paid to any
      Person to amend or consent to a waiver or modification of any provision of
      any
      of the Transaction Documents unless the same consideration is also offered
      to
      all of the parties to the Transaction Documents. For clarification purposes,
      this provision constitutes a separate right granted to each Purchaser by the
      Company and negotiated separately by each Purchaser, and is intended for the
      Company to treat the Purchasers as a class and shall not in any way be construed
      as the Purchasers acting in concert or as a group with respect to the purchase,
      disposition or voting of Securities or otherwise.

     

    
      
        
        

      

      
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    4.12 [RESERVED]

     

    4.13 Subsequent
      Equity Sales. 

     

    (a) From
      the
      date hereof until 30 days after the Closing Date, neither the Company nor any
      Subsidiary shall issue shares of Common Stock or Common Stock Equivalents;
      provided,
      however,
      the 30
      day period set forth in this Section 4.13 shall be extended for the number
      of
      Trading Days during such period in which (i) trading in the Common Stock is
      suspended by any Trading Market, or (ii) the Registration Statement is not
      effective or the prospectus included in the Registration Statement may not
      be
      used by the Purchasers for the resale of the Shares and Warrant
      Shares.

     

    (b) From
      the
      date hereof until the earliest of (i) two years after the Closing Date and
      (ii)
      such time as no Purchaser holds any of the Securities, the Company shall be
      prohibited from effecting or entering into an agreement to effect any issuance
      by the Company or any of its Subsidiaries of Common Stock or Common Stock
      Equivalents for cash consideration involving a Variable Rate Transaction.
“Variable
      Rate Transaction”
means
      a
      transaction in which the Company issues or sells any debt or equity securities
      that are convertible into, exchangeable or exercisable for, or include the
      right
      to receive additional shares of Common Stock either (A) at a conversion,
      exercise or exchange rate or other price that is based upon and/or varies with
      the trading prices of or quotations for the shares of Common Stock at any time
      after the initial issuance of such debt or equity securities, or (B) with a
      conversion, exercise or exchange price that is subject to being reset at some
      future date after the initial issuance of such debt or equity security or upon
      the occurrence of specified or contingent events directly or indirectly related
      to the business of the Company or the market for the Common Stock (but
      specifically not including a price based anti-dilution provision that resets
      the
      conversion, exercise or exchange price due to the pricing of a financing that
      occurs after the date of such Subsequent Financing). Any Purchaser shall be
      entitled to obtain injunctive relief against the Company to preclude any such
      issuance, which remedy shall be in addition to any right to collect damages.
      

     

    (c) Notwithstanding
      the foregoing, this Section 4.13 shall not apply in respect of an Exempt
      Issuance, except that no Variable Rate Transaction shall be an Exempt
      Issuance.

     

    4.14 Short
      Sales and Confidentiality After The Date Hereof. Each Purchaser, severally
      and not jointly with the other Purchasers, covenants that neither it nor any
      Affiliate acting on its behalf or pursuant to any understanding with it will
      execute any Short Sales during the period commencing with the Discussion Time
      and ending at such time the transactions contemplated by this Agreement are
      first publicly announced as described in Section 4.4. 
      Each
      Purchaser, severally and not jointly with the other Purchasers, covenants that
      until such time as the transactions contemplated by this Agreement are publicly
      disclosed by the Company as described in Section 4.4, such Purchaser will
      maintain the confidentiality of the existence and terms of this transaction
      and
      the information included in the Disclosure Schedules.  Notwithstanding
      the foregoing, no Purchaser makes any representation, warranty or covenant
      hereby that it will not engage in Short Sales in the securities of the Company
      after the time that the transactions contemplated by this Agreement are first
      publicly announced as described in Section 4.4.  Notwithstanding
      the foregoing, in the case of a Purchaser that is a multi-managed investment
      vehicle whereby separate portfolio managers manage separate portions of such
      Purchaser’s assets and the portfolio managers have no direct knowledge of the
      investment decisions made by the portfolio managers managing other portions
      of
      such Purchaser’s assets, the covenant set forth above shall only apply with
      respect to the portion of assets managed by the portfolio manager that made
      the
      investment decision to purchase the Securities covered by this
      Agreement.

     

    
      
        
        

      

      
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    4.15 Delivery
      of Securities After Closing. The Company shall deliver, or cause to be
      delivered, the respective Securities purchased by each Purchaser to such
      Purchaser within 3 Trading Days of the Closing Date.

     

    ARTICLE
      V.

    MISCELLANEOUS

     

    5.1
      Termination. This
      Agreement may be terminated prior to the Closing by any Purchaser, as to such
      Purchaser’s obligations hereunder only and without any effect whatsoever on the
      obligations between the Company and the other Purchasers, by written notice
      to
      the other parties, if the Closing has not been consummated on or before April
      30, 2008; provided, however, that no such termination will affect
      the right of any party to sue for any breach by the other party (or
      parties).

     

    5.2 Fees
      and Expenses. Except as expressly set forth in the Transaction Documents to
      the contrary, each party shall pay the fees and expenses of its advisers,
      counsel, accountants and other experts, if any, and all other expenses incurred
      by such party incident to the negotiation, preparation, execution, delivery
      and
      performance of this Agreement. The Company shall pay all Transfer Agent fees,
      stamp taxes and other taxes and duties levied in connection with the delivery
      of
      any Securities to the Purchasers other than income taxes of the Purchasers
      that
      may be incurred in connection with the transactions contemplated
      hereby.

     

    5.3 Entire
      Agreement. The Transaction Documents, together with the exhibits and
      schedules thereto, the Prospectus and the Prospectus Supplement, contain the
      entire understanding of the parties with respect to the subject matter hereof
      and supersede all prior agreements and understandings, oral or written, with
      respect to such matters, which the parties acknowledge have been merged into
      such documents, exhibits and schedules.

     

    5.4 Notices.
      Any and all notices or other communications or deliveries required or permitted
      to be provided hereunder shall be in writing and shall be deemed given and
      effective on the earliest of: (a) the date of transmission, if such notice
      or
      communication is delivered via facsimile at the facsimile number set forth
      on
      the signature pages attached hereto prior to 5:30 p.m. (New York City time)
      on a
      Trading Day, (b) the next Trading Day after the date of transmission, if such
      notice or communication is delivered via facsimile at the facsimile number
      set
      forth on the signature pages attached hereto on a day that is not a Trading
      Day
      or later than 5:30 p.m. (New York City time) on any Trading Day, (c) the
      2nd
      Trading
      Day following the date of mailing, if sent by U.S. nationally recognized
      overnight courier service, (d) four (4) days after being placed in the mail,
      if
      mailed or (e) upon actual receipt by the party to whom such notice is required
      to be given. The address for such notices and communications shall be as set
      forth on the signature pages attached hereto.

     

    
      
        
        

      

      
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    5.5 Amendments;
      Waivers. No provision of this Agreement may be waived or amended except in a
      written instrument signed by the Company and the Purchasers holding at least
      a
      majority of the Shares still held by the Purchasers. No waiver of any default
      with respect to any provision, condition or requirement of this Agreement shall
      be deemed to be a continuing waiver in the future or a waiver of any subsequent
      default or a waiver of any other provision, condition or requirement hereof,
      nor
      shall any delay or omission of any party to exercise any right hereunder in
      any
      manner impair the exercise of any such right.

     

    5.6 Headings.
      The headings herein are for convenience only, do not constitute a part of this
      Agreement and shall not be deemed to limit or affect any of the provisions
      hereof.

     

    5.7 Successors
      and Assigns. This Agreement shall be binding upon and inure to the benefit
      of the parties and their successors and permitted assigns. The Company may
      not
      assign this Agreement or any rights or obligations hereunder without the prior
      written consent of each Purchaser; provided, however, that the Company may
      assign its rights and delegate its duties hereunder to any surviving, acquiring
      or successor corporation in connection with a merger or consolidation of the
      Company with another corporation, or a sale, transfer or other disposition
      of
      all or substantially all of the Company’s assets to another corporation, or
      other similar transaction, without the prior written consent of the purchasers,
      after notice duly given by the Company to the Purchasers. Any Purchaser may
      assign any or all of its rights under this Agreement to any Person to whom
      such
      Purchaser assigns or transfers any Securities, provided such transferee agrees
      in writing to be bound, with respect to the transferred Securities, by the
      provisions of the Transaction Documents that apply to the
“Purchasers.”

     

    5.8 No
      Third-Party Beneficiaries. This Agreement is intended for the benefit of the
      parties hereto and their respective successors and permitted assigns and is
      not
      for the benefit of, nor may any provision hereof be enforced by, any other
      Person, except as otherwise set forth in Section 4.8.

     

    5.9 Governing
      Law. All questions concerning the construction, validity, enforcement and
      interpretation of the Transaction Documents shall be governed by and construed
      and enforced in accordance with the internal laws of the State of New York,
      without regard to the principles of conflicts of law thereof. Each party agrees
      that all legal proceedings concerning the interpretations, enforcement and
      defense of the transactions contemplated by this Agreement and any other
      Transaction Documents (whether brought against a party hereto or its respective
      affiliates, directors, officers, shareholders, employees or agents) shall be
      commenced exclusively in the state and federal courts sitting in the City of
      New
      York. Each party hereby irrevocably submits to the exclusive jurisdiction of
      the
      state and federal courts sitting in the City of New York, borough of Manhattan
      for the adjudication of any dispute hereunder or in connection herewith or
      with
      any transaction contemplated hereby or discussed herein (including with respect
      to the enforcement of any of the Transaction Documents), and hereby irrevocably
      waives, and agrees not to assert in any suit, action or proceeding, any claim
      that it is not personally subject to the jurisdiction of any such court, that
      such suit, action or proceeding is improper or is an inconvenient venue for
      such
      proceeding. Each party hereby irrevocably waives personal service of process
      and
      consents to process being served in any such suit, action or proceeding by
      mailing a copy thereof via registered or certified mail or overnight delivery
      (with evidence of delivery) to such party at the address in effect for notices
      to it under this Agreement and agrees that such service shall constitute good
      and sufficient service of process and notice thereof. Nothing contained herein
      shall be deemed to limit in any way any right to serve process in any other
      manner permitted by law. If either party shall commence an action or proceeding
      to enforce any provisions of the Transaction Documents, then the prevailing
      party in such action or proceeding shall be reimbursed by the other party for
      its reasonable attorneys’ fees and other costs and expenses incurred with the
      investigation, preparation and prosecution of such action or
      proceeding.

     

    
      
        
        

      

      
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    5.10 Survival.
      The representations, warranties and covenants contained herein shall survive
      the
      Closing and the delivery of the Securities for the applicable statute of
      limitations; provided that the survival period for the representations and
      warranties shall be 18 months following the Closing Date.

     

    5.11 Execution.
      This Agreement may be executed in two or more counterparts, all of which when
      taken together shall be considered one and the same agreement and shall become
      effective when counterparts have been signed by each party and delivered to
      the
      other party, it being understood that both parties need not sign the same
      counterpart. In the event that any signature is delivered by facsimile
      transmission or by e-mail delivery of a “.pdf” format data file, such signature
      shall create a valid and binding obligation of the party executing (or on whose
      behalf such signature is executed) with the same force and effect as if such
      facsimile or “.pdf” signature page were an original thereof.

     

    5.12 Severability.
      If any term, provision, covenant or restriction of this Agreement is held by
      a
      court of competent jurisdiction to be invalid, illegal, void or unenforceable,
      the remainder of the terms, provisions, covenants and restrictions set forth
      herein shall remain in full force and effect and shall in no way be affected,
      impaired or invalidated, and the parties hereto shall use their commercially
      reasonable efforts to find and employ an alternative means to achieve the same
      or substantially the same result as that contemplated by such term, provision,
      covenant or restriction. It is hereby stipulated and declared to be the
      intention of the parties that they would have executed the remaining terms,
      provisions, covenants and restrictions without including any of such that may
      be
      hereafter declared invalid, illegal, void or unenforceable.

     

    5.13 Rescission
      and Withdrawal Right. Notwithstanding anything to the contrary contained in
      (and without limiting any similar provisions of) any of the other Transaction
      Documents, whenever any Purchaser exercises a right, election, demand or option
      under a Transaction Document and the Company does not timely perform its related
      obligations within the periods therein provided, then such Purchaser may rescind
      or withdraw, in its sole discretion from time to time upon reasonable prior
      written notice to the Company, any relevant notice, demand or election in whole
      or in part without prejudice to its future actions and rights; provided,
however, that in the case of a rescission of an exercise of a Warrant,
      the Purchaser shall be required to return any shares of Common Stock delivered
      in connection with any such rescinded exercise notice.

     

    
      
        
        

      

      
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    5.14 Replacement
      of Securities. If any certificate or instrument evidencing any Securities is
      mutilated, lost, stolen or destroyed, the Company shall issue or cause to be
      issued in exchange and substitution for and upon cancellation thereof (in the
      case of mutilation), or in lieu of and substitution therefor, a new certificate
      or instrument, but only upon receipt of evidence reasonably satisfactory to
      the
      Company of such loss, theft or destruction. The applicant for a new certificate
      or instrument under such circumstances shall also pay any reasonable third-party
      costs (including customary indemnity) associated with the issuance of such
      replacement Securities.

     

    5.15 Remedies.
      In addition to being entitled to exercise all rights provided herein or granted
      by law, including recovery of damages, each of the Purchasers and the Company
      will be entitled to specific performance under the Transaction Documents. The
      parties agree that monetary damages may not be adequate compensation for any
      loss incurred by reason of any breach of obligations contained in the
      Transaction Documents and hereby agrees to waive and not to assert in any action
      for specific performance of any such obligation the defense that a remedy at
      law
      would be adequate.

     

    5.16 Payment
      Set Aside. To the extent that the Company makes a payment or payments to any
      Purchaser pursuant to any Transaction Document or a Purchaser enforces or
      exercises its rights thereunder, and such payment or payments or the proceeds
      of
      such enforcement or exercise or any part thereof are subsequently invalidated,
      declared to be fraudulent or preferential, set aside, recovered from, disgorged
      by or are required to be refunded, repaid or otherwise restored to the Company,
      a trustee, receiver or any other person under any law (including, without
      limitation, any bankruptcy law, state or federal law, common law or equitable
      cause of action), then to the extent of any such restoration the obligation
      or
      part thereof originally intended to be satisfied shall be revived and continued
      in full force and effect as if such payment had not been made or such
      enforcement or setoff had not occurred.

     

    5.17 Independent
      Nature of Purchasers’ Obligations and Rights. The obligations of each
      Purchaser under any Transaction Document are several and not joint with the
      obligations of any other Purchaser, and no Purchaser shall be responsible in
      any
      way for the performance or non-performance of the obligations of any other
      Purchaser under any Transaction Document. Nothing contained herein or in any
      other Transaction Document, and no action taken by any Purchaser pursuant
      thereto, shall be deemed to constitute the Purchasers as a partnership, an
      association, a joint venture or any other kind of entity, or create a
      presumption that the Purchasers are in any way acting in concert or as a group
      with respect to such obligations or the transactions contemplated by the
      Transaction Documents. Each Purchaser shall be entitled to independently protect
      and enforce its rights including, without limitation, the rights arising out
      of
      this Agreement or out of the other Transaction Documents, and it shall not
      be
      necessary for any other Purchaser to be joined as an additional party in any
      proceeding for such purpose. Each Purchaser has been represented by its own
      separate legal counsel in their review and negotiation of the Transaction
      Documents. For reasons of administrative convenience only, Purchasers and their
      respective counsel have chosen to communicate with the Company through FWS.
      FWS
      does not represent any of the Purchasers but only Rodman & Renshaw, LLC, the
      placement agent. The Company has elected to provide all Purchasers with the
      same
      terms and Transaction Documents for the convenience of the Company and not
      because it was required or requested to do so by the Purchasers.

     

    
      
        
        

      

      
        27

        
          

        

      

      
        
        

      

    

    

    5.18 Liquidated
      Damages. The Company’s obligations to pay any partial liquidated damages or
      other amounts owing under the Transaction Documents is a continuing obligation
      of the Company and shall not terminate until all unpaid partial liquidated
      damages and other amounts have been paid notwithstanding the fact that the
      instrument or security pursuant to which such partial liquidated damages or
      other amounts are due and payable shall have been canceled.

     

    5.19 Saturdays,
      Sundays, Holidays, etc. If
      the
      last or appointed day for the taking of any action or the expiration of any
      right required or granted herein shall not be a Business Day, then such action
      may be taken or such right may be exercised on the next succeeding Business
      Day.

     

    5.20 Construction.
      The parties agree that each of them and/or their respective counsel has reviewed
      and had an opportunity to revise the Transaction Documents and, therefore,
      the
      normal rule of construction to the effect that any ambiguities are to be
      resolved against the drafting party shall not be employed in the interpretation
      of the Transaction Documents or any amendments hereto.

     

    5.21 WAIVER
      OF JURY TRIAL. IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT
      BY
      ANY PARTY AGAINST ANY OTHER PARTY, THE PARTIES EACH KNOWINGLY AND INTENTIONALLY,
      TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY,
      UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVES FOREVER TRIAL BY
      JURY.

     

    (Signature
      Pages Follow)

     

    
      
        
        

      

      
        28

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF, the parties hereto have caused this Securities Purchase
      Agreement to be duly executed by their respective authorized signatories as
      of
      the date first indicated above.

    

    
      	
              NUTRACEA

               

            	
              Address
                for Notice:

              5090
                N. 40th Street , Suite 400

              Phoenix,
                AZ 85018

              Facsimile:
                (916) 933-7001

              Attention:
                Chief Executive Officer

              Fax:
                (602) 522-3001

            

    

    

    
      	
              By: 

            	 
	 	
              Name:

              Title:

            

    

    
      With
        a
        copy to (which shall not constitute notice):

    

    
      Weintraub
        Genshlea Chediak law corporation

      400
        Capitol Mall

      Sacramento,
        CA 95814

      Facsimile:
        (916) 446-1611

      Attn.:
        Christopher Chediak, Esq.

    

     

    [REMAINDER
      OF PAGE INTENTIONALLY LEFT BLANK

    SIGNATURE
      PAGE FOR PURCHASER FOLLOWS]

     

    
      
        
        

      

      
        29

        
          

        

      

      
        
        

      

    

     

    [PURCHASER
      SIGNATURE PAGES TO NUTRACEA SECURITIES PURCHASE AGREEMENT]

    

    IN
      WITNESS WHEREOF, the undersigned have caused this Securities Purchase Agreement
      to be duly executed by their respective authorized signatories as of the date
      first indicated above.

     

    Name
      of
      Purchaser: ________________________________________________________

     

    Signature
      of Authorized Signatory of Purchaser:
      _________________________________

     

    Name
      of
      Authorized Signatory:
      _______________________________________________

     

    Title
      of
      Authorized Signatory:
      ________________________________________________

     

    Email
      Address of Authorized
      Signatory:_________________________________________

     

    Fax
      Number of Authorized Signatory:
      __________________________________________

     

    Address
      for Notice of Purchaser:

     

     

    Address
      for Delivery of Securities for Purchaser (if not same as address for
      notice):

     

     

    Subscription
      Amount: $_________________

    

    Shares:
      _________________

    

    Warrant
      Shares: __________________

    

    EIN
      Number: [PROVIDE
      THIS UNDER SEPARATE COVER]

     

    [SIGNATURE
      PAGES CONTINUE]

     

    
      
        
        

      

      
        30

        
          

        

      

      
        
        

      

    

    
Exhibit
      3.2(c)

    

    State
      Institutional Investor Requirements

     

    
      
        
        

      

      
        3120-F

Exhibit 4.7  

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	

	
 

	

	
 

	
SGOOLA INDUSTRIAL ZONE

  P.O.B. 159, PETACH
  TlKVA

  49101 ISRAEL

  TEL: 972-3-9395050

  FAX: 972-3-9309581

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
December
  17, 2007

To:
Mr. Alois Kubat

Dear
Mr. Kubat,

Re: Letter of Comfort

Reference
is made to the share purchase agreement, dated as of June 10, 2002 (the “Purchase Agreement”), by and
among En-Eltek B.V. 2002, Netherlands (“Eltek
B.V.”), Mr. Alois Kubat (“Kubat”), and other shareholders of
Kubatronik-Leiterplatten GmbH (the “Company”),
pursuant to which Eltek B.V. purchased shares of the Company from
Kubat, and to the Second Extension of Put/Call Option Provisions under the Share
Purchase Agreement, dated as of December     , 2007 (the “Second Extension Agreement”).

	
 

	
 

	
 

	
1.

	
Capitalized
  terms used herein and not otherwise defined herein shall have the meanings assigned to them in
  the Purchase Agreement.

	
 

	
 

	
2.

	
In
  order to secure Kubat’s rights in connection with Kubat’s Put Right, Eltek
  Ltd. from Petch-Tikva, Israel (“Eltek”), being the sole shareholder of Eltek
  B.V., hereby undertakes that:

	
 

	
 

	
 

	
 

	
a.

	
upon
  exercise of Kubat’s Put Right, Eltek shall cause Eltek B.V. to pay the
  purchase price in consideration of Kubat’s Holdings on the due payment date
  thereof, all as set forth in Section 7.4.1 of the Purchase Agreement; and

	
 

	
 

	
 

	
 

	
b.

	
upon exercise of Kubat’s
  Put Right, Eltek shall ensure that Eltek B.V. is furnished with sufficient financial resources as will be
  required to meet Eltek B.V.’s payment
  obligations pursuant to Section 7.4.1 of the Purchase Agreement.

	
 

	
 

	
 

	
3.

	
Eltek’s
  undertakings pursuant to this letter of comfort shall remain in full force
  and effect until the expiration of the Option Period in accordance with Section
  7.4.1(a) of the Purchase Agreement and any extension period pursuant to the
  Second Extension Agreement.

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Sincerely,

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Eltek
  Ltd.

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	

	
 

	
 

	

	
 

	

	

	
 

	

	
 

	
By:

	
Arieh
  Reichart 

	
 

	
By:

	
Nissim Gilam

	
 

	
 

	
CEO

	
 

	
 

	
Chairman
  of the Board of Directors

	
 

SECOND
EXTENSION OF PUT/CALL OPTION PROVISIONS UNDER THE SHARE PURCHASE AGREEMENT

This second extension
agreement (the “Second Extension Agreement”)
of certain put/call option provisions under the share purchase agreement, dated
as of June 10, 2002 (the “Purchase Agreement”)
is made on this ___ day of December 2007, by and between:

EN-Eltek Netherlands 2002
B.V., a Netherlands corporation with offices located at Naritaweg 165 Telestone
8 1043BW, Amsterdam, The Netherlands (hereinafter: “En-Eltek”), and 

Mr. Alois Kubat, of
Filsstrasse 3, 73326 Deggingen, Germany (hereinafter: “Alois”).

Preambles:

	
 

	
 

	
WHEREAS,

	
pursuant to the Purchase
  Agreement, Alois has a Put Right and En-Eltek has a Call Right; and

	
 

	
 

	
WHEREAS,

	
the parties hereto have
  entered into an Extension of Put/Call Option Agreement (the “First Extension Agreement”) on 4 May
  2005, pursuant to which the Option Period was extended until December 31, 2007
  and certain adjustments were made to the maximum price and minimum price (as
  such terms are used in the Purchase Agreement) of Alois’ Holdings; and

	
 

	
 

	
WHEREAS,

	
the parties wish to extend
  the Option Period and to amend certain provisions of the Purchase Agreement.

NOW, THEREFORE, it is agreed as follows:

	
 

	
 

	
1.

	
Capitalized terms used in
  this Second Extension Agreement and not otherwise defined herein shall have
  the meanings assigned to them under the Purchase Agreement.

	
 

	
 

	
2.

	
Notwithstanding the
  provisions of Section 7.4.1(a), the Option Period shall be extended until
  December 31, 2012 (the “Extended Option
  Period”) and shall be automatically renewed thereafter for
  additional consecutive two-year periods, unless otherwise notified in writing
  by either party at least six months prior to the lapse of the Extended Option
  Period or the applicable renewal period, as the case may be.

	
 

	
 

	
3.

	
The provisions of Section
  3 to the First Extension Agreement, pursuant to which the minimum Price and
  the maximum Price for Alois’ Holdings were set at an annual rate of LIBOR
  + 1%, are hereby cancelled with retroactive effect, and accordingly, the
  minimum Price for Alois’ Holdings in the amount of l,080,000 DM and the
  maximum Price for Alois’ Holdings in the amount of 1,800,000 DM shall each
  remain at their original values according to the Purchase Agreement.

	
 

	
 

	
 

	
 

	

	

1

	
 

	
 

	
4.

	
Notwithstanding the
  provision of Section 7.4.l(c), the payment of the purchase price for Alois’
  Holdings shall be due within six (6) months following receipt of the Option
  Notice.

	
 

	
 

	
5.

	
All other terms and
  conditions of the Purchase Agreement not specifically amended by this Second
  Extension Agreement shall continue to be in full force and effect.

	
 

	
 

	
6.

	
This Second Extension
  Agreement may be executed in two or more counterparts, each of which shall be
  deemed an original, but all of each together shall constitute one and the same instrument.

IN WITNESS WHEREOF, En-Eltek and Alois have executed this Extension Agreement as of the
day and year first above written.

	
 

	
 

	
 

	
 

	
 

	
EN-Eltek Netherlands 2002 B.V.

	
 

	
Mr. Alois Kubat

	
 

	
By:

	

	
 

	
 

	

	
 

	

	
 

	
 

	

	
Name:

	
Nissim Gilam, Arieh Reichart

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Date: 

	
17.12.07

	
 

	
Date:

	
28.12.07

2

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