Common use of Exercise Clause in Contracts

Exercise. (a) The Exercise Price per share of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option shall be deemed to have been exercised and such Shares shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record of such Shares as of the date that such Notice of Exercise and payment shall have been received by the Company.

Exercise. (a) 4.1 The Exercise Price per share Purchase Rights represented by this Warrant are exercisable upon the terms and conditions set forth herein at the option of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Option may be exercised by (i) providing written notice to the Company Holder in the form prescribed by the stockholders from whole at any time to time and in part, but not for less than 100 shares at a time, at any time and from time to time after during the Option becomes exercisable in accordance with Section 2 (Exercise Period upon the “Notice delivery of Exercise”), which the Notice of Exercise shall be delivered form attached hereto as Exhibit 1 to the Company with such notice duly executed and upon payment in the formcash, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage wire transfer or bank cashier’s check of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of ExercisePrice. The Option Purchase Rights shall be deemed to have been exercised exercised, and such Shares the Holder shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder stockholder of record of such Shares the Company for the purposes of receiving dividends and for all other purposes whatsoever with respect to the shares of Common Stock so purchased, as of the date of delivery of such properly executed notice accompanied by proper tender of the Exercise Price at the office of the Company. As promptly as practicable on or after such date, and in any event within three (3) business days thereafter, the Company at its expense shall issue and deliver, or cause to be issued and delivered, to the person or persons entitled to receive the same, a certificate or certificates for the number of shares issuable upon such exercise. In the event that this Warrant is exercised in part, the Company at its expense shall execute and deliver a new Warrant of like tenor exercisable for the number of shares for which this Warrant may then be exercised. 4.2 In lieu of the payment methods set forth in Section 4.1 above, in the event the Warrant Shares have not been registered under an effective registration statement filed pursuant to the Securities Act prior to the earlier of: (i) one (1) year from the Issue Date of this Warrant; or (ii) the closing of the Qualified Public Offering, the Holder may elect to exchange all or some of this Warrant for shares of Common Stock equal to the value of the amount of the Warrant being exchanged on the date of exchange. If Holder elects to exchange this Warrant as provided in this Section 4.2, Holder shall tender to the Company the Warrant for the amount being exchanged, along with written notice of Holder’s election to exchange some or all of the Warrant, and the Company shall issue to Holder the number of shares of the Common Stock computed using the following formula: Where: X = the number of shares of Common Stock to be issued to Holder. Y = the number of shares of Common Stock purchasable under the amount of the Warrant being exchanged (as adjusted to the date of such Notice calculation). A = the Fair Market Value of Exercise and payment shall have been one share of the Common Stock on the date that the notice of exercise is received by the Company. B = Exercise Price (as adjusted to the date of such calculation).

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Registered Holder on or before the Termination Date, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as Exhibit I duly executed by the Registered Holder at the principal executive offices of the Option is $0.25Company, or at such other office or agency as the Company may designate, accompanied by payment in full, in lawful money of the United States, of the Warrant Price payable in respect of the number of Warrant Shares purchased upon such exercise. The Option may only "Warrant Price" shall initially be exercised if it becomes exercisable pursuant $2.23 and from time to time shall be such amount adjusted in accordance with Section 22 hereof. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above (the “Exercise Date”). At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1(d) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such certificates. (c) As soon as practicable after the exercise of this Warrant in full or in part, and in any event within twenty (20) days thereafter, the Company, at its expense, will cause to be issued in the name of, and delivered to, the Registered Holder, or as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of Warrant Shares as of to which the Registered Holder shall be entitled upon such exercise; and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, calling in the aggregate on the face or faces thereof for the number of Warrant Shares equal (without giving effect to any adjustment therein) to the number of such Notice shares called for on the face of Exercise and payment shall have been received this Warrant minus the number of such shares purchased by the CompanyRegistered Holder upon such exercise.

Exercise. (a) The Exercise Price per share Subject to the other terms and conditions hereof, the Option shall be exercisable, provided payment is made as provided below, from time to time by written notice to the Company (in the form required by the Company, the covenants and substantive provisions of which are hereby made part of this Agreement) which shall: (i) State that the Option is $0.25. The thereby being exercised, the number of Shares with respect to which the Option is being exercised, each person in whose name any certificates for the Shares should be registered and such person's address and social security number; (ii) Be signed by the person or persons entitled to exercise the Option and, if the Option is being exercised by anyone other than the Holder, be accompanied by proof satisfactory to counsel for the Company of the right of such person or persons to exercise the Option under all applicable laws and regulations; and (iii) Be accompanied by such representations, warranties or agreements with respect to the investment intent of such person or persons exercising the Option and the compliance with any applicable law or regulation or to confirm any factual matters as the Company or its counsel may only be exercised if it becomes exercisable pursuant reasonably request, in form and substance satisfactory to Section 2counsel for the Company. (b) The Option Payment of the exercise price may be exercised made, in the discretion of the person exercising the Option, in one of the following manners, or in any other manner approved by the Board, in its sole discretion: (i) providing The written notice to the Company described above may be accompanied by full payment of the exercise price in cash or by check, or in whole or in part with a surrender or withholding of Shares of the form prescribed Company having a Fair Market Value (as defined below) on the date of exercise equal to that portion of the exercise price for which payment in cash or check is not made. The value of each such Share surrendered or withheld shall be 100% of the Fair Market Value of the Shares on the date the Option is exercised. The latter of the dates on which such notice and payment are received by the stockholders from time Company shall be the date of exercise of the Option; and (ii) Within five days of the giving of the written notice to time at any time and from time the Company described above, the funds to time after pay for the exercise of the Option becomes exercisable in accordance with Section 2 (the “Notice of Exercise”), which Notice of Exercise shall may be delivered to the Company by a broker acting on behalf of the person exercising the Option either in connection with the formsale of the Shares underlying the Option or in connection with the making of a margin loan to such person to enable payment of the exercise price of the Option. The latter of the dates on which the Company receives such notice and payment shall be the date of exercise of the Option. In connection with any such exercise, and in the manner, designated Company will provide a copy of the notice of exercise of the Option to the aforesaid broker upon receipt by the Company from time of such notice and will deliver to timesuch broker, and (ii) paying within five business days of the Exercise Price per share. If permitted by delivery of such notice to the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented a certificate or certificates (as requested by the fractional purchasebroker) representing the number of Shares underlying the Option that have been sold by such broker for the person exercising the Option. (c) Payment For purposes hereof, the "Fair Market Value" of the Exercise Price per share may a Share as of a given date shall be made, at your election, with the approval (in order of the Company, applicability): (i) if the closing price of a Share on the principal exchange on which the Shares are readily tradable then trading, if any, on the day immediately prior to such date, or if Shares were not traded on the day previous to such date, then on the next preceding trading day during which a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, sale occurred; or (ii) if the Shares are not readily tradable traded on an exchange but are quoted on NASDAQ or a national securities marketsuccessor quotation system, (A) the last sale price (if Shares are then listed as a National Market Issue under the NASD National Market System), or (B) if Shares are not then so listed, the mean between the closing representative bid and asked prices for Shares on the day previous to such date as reported by any method pre-approved NASDAQ or such successor quotation system; or (iii) if Shares are not publicly traded on an exchange and not quoted on NASDAQ or a successor quotation system, the mean between the closing bid and asked prices for Shares, on the day previous to such date, as determined in good faith by the CompanyBoard; or (iv) if Shares are not publicly traded, the fair market value established by the Board acting in good faith. (d) As soon as practicable but not later than five Business Days after Upon exercise of the Company shall have received such Notice Option and the satisfaction of Exercise and paymentall conditions thereto, the Company shall issue deliver a certificate or cause certificates for Shares to be issued, in accordance with the specified person or persons at the specified time upon receipt of payment for such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exerciseas set forth above. The Option shall be deemed to have been exercised and such No Shares shall be deemed to have issued on an exercise of an Option until full payment has been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record of such Shares as of the date that such Notice of Exercise and payment shall have been received by the Companymade.

Exercise. (a) The This Warrant may be exercised by the Registered Holder during the Exercise Period, in whole or in part, by the surrender of this Warrant (with the Notice of Exercise Form attached hereto as Exhibit A (the “Exercise Notice”) duly executed by such Registered Holder) at the principal office of the Company, or at such other office or agency as the Company may designate, accompanied by payment in full, in lawful money of the United States, of an amount equal to the then applicable Exercise Price per share multiplied by the number of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2Warrant Shares then being purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above, if so surrendered prior to 5:00 p.m., New York City time, or if surrendered after 5:00 p.m., New York City time, as of the next business day. At such time, the Person or Persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1(c), below, shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such Shares as certificates. (c) Subject to the adjustments set forth in Section 3, exercises hereunder shall be only in full share increments. Within five (5) business days after the exercise of the purchase right represented by this Warrant, the Company at its expense will use its best efforts to cause to be issued in the name of, and delivered to, the Registered Holder, or, subject to the terms and conditions hereof (including the requirement that there be a registration statement then in effect with respect to transfers or an exemption therefrom), to such other individual or entity as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of whole Warrant Shares to which such Registered Holder shall be entitled upon such exercise (as such number of Warrant Shares may be adjusted pursuant to Section 3 hereof), and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, stating on the face or faces thereof the number of shares currently stated on the face of this Warrant minus the number of such Notice of Exercise and payment shall have been received shares purchased by the CompanyRegistered Holder upon such exercise as provided in subsection 1(a) above.

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as EXHIBIT I duly executed by such Registered Holder or by such Registered Holder's duly authorized attorney, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant to Section 2designate, accompanied by payment in full, in lawful money of the United States, of the Purchase Price payable in respect of the number of Warrant Shares purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day (the "Exercise Date") on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above. At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such certificates. (c) As soon as practicable after the exercise of this Warrant in full or in part, within ten (10) days thereafter, the Company, at its expense, will cause to be issued in the name of, and delivered to, the Registered Holder, or as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full Warrant Shares as to which such Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which such Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof; and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date hereof) of like tenor, calling in the aggregate on the face or faces thereof for the number of Warrant Shares equal (without giving effect to any adjustment therein) to the number of such shares called for on the face of this Warrant minus the sum of the date that number of such Notice of Exercise and payment shall have been received shares purchased by the CompanyRegistered Holder upon such exercise.

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as Exhibit I duly executed by the Registered Holder or by the Registered Holder's duly authorized attorney, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant to Section 2designate, accompanied by payment (by wire transfer) in full, in lawful money of the United States, of the Purchase Price payable in respect of the number of Warrant Shares purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day (the "Exercise Date") on which this Warrant shall have been surrendered to the Company as provided in Section 1(a) above. At such Shares time, the Registered Holder shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a the holder of record of the Warrant Shares. (c) As soon as practicable after the exercise of this Warrant in full or in part, and in any event within 15 days thereafter, the Company, at its expense, will cause to be issued in the name of, and delivered to, the Registered Holder (upon payment by the Registered Holder of any applicable transfer taxes): (i) a certificate or certificates for the whole number of duly authorized, validly issued, fully paid and non-assessable Warrant Shares to which the Registered Holder shall be entitled upon such Shares as exercise plus, in lieu of any fractional share to which the Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof; and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, calling in the aggregate on the face or faces thereof for the number of Warrant Shares equal (without giving effect to any adjustment therein) to the number of such Notice shares called for on the face of Exercise and payment shall have been received this Warrant minus the number of such shares purchased by the CompanyRegistered Holder upon such exercise.

Exercise. (a) The Exercise Price per share A. Upon the termination of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance Optionee's employment with Section 2 (the “Notice of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option shall be exercisable, to the extent of the number of shares purchasable by Optionee that are vested at the date of such termination after giving effect to the vesting acceleration provisions of this Option if applicable and, for subparts (a) and (b) below, contingent on the effectiveness of the Release and the Optionee's continuing compliance in all material respects with such Release, only (a) within one year after such termination if the Optionee's termination is coincident with the Optionee's death or Disability, (b) within 180 days after a Qualifying Termination (unless such Qualifying Termination has occurred (or pursuant to Section 14(c) of the Employment Agreement is deemed to have occurred) within 24 months of a Change of Control in which this Option was assumed by the Successor Corporation, in which case this Option shall remain exercisable until the one-year anniversary of such Qualifying Termination) or (c) within 90 days of the date that Optionee ceases to be an employee, director, officer, consultant, agent, advisor or independent contractor of the Company or a subsidiary (collectively, "Service") if Optionee's employment is terminated for any other reason, but in no event later than the remaining Term of the Option. Any portion of this Option exercisable at the time of the Optionee's death may be exercised in fractions by paying the percentage personal representative of the Exercise Price per share represented Optionee's estate or the person(s) to whom the Optionee's rights under the Option have passed by will or the fractional purchase. applicable laws of descent and distribution. This Option may be exercised only for whole shares of Common Stock. Any unvested portion of this Option (after giving effect to the acceleration provisions of this Option) shall expire and will be immediately canceled upon cessation of Optionee's Service. Any unexercised portion of this Option shall expire and will be immediately canceled upon the earlier of the end of the Term or, if applicable, the date specified above in subparts (a), (b) or (c) Payment of the Exercise Price per share may ). All shares subject to any such canceled portion shall no longer be made, at your election, available for purchase or issuance under this Option. In connection with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, any proposed same day exercise and sale transaction to be completed through a “cashless exercise” in accordance with a CompanyOptionee's personally-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and paymentselected broker, the Company shall issue or cause will agree to use commercially reasonable efforts to assure such broker that shares will be issuedtimely delivered upon exercise of this Option, and payment of the exercise price therefor, in accordance with such the terms hereof. B. This Option may not be exercised more than ten (10) years from the date hereof (the "Term"), and may be exercised during the Term only in accordance with the terms and provisions set forth herein. C. This Option may be exercised for all or part of the shares eligible for exercise by presenting a written notice (the "Notice") to the Company that this Option is exercised in strict accordance with the terms and provisions of this Option. The Company shall determine in good faith whether or not the Notice complies with the terms and provisions of Exercisethis Option. Such Notice shall identify this Option, state the number of Shares specified shares as to which the Option is exercised and be signed by the Optionee. Delivery of the cash or cash equivalent in payment for the shares to be purchased pursuant to the exercise of this Option shall accompany the Notice. If the Optionee is deceased, the Notice shall be signed, and if the Optionee has a Disability, it may be signed, by the Optionee's legal representatives or beneficiaries, and in all instances shall be accompanied by evidence satisfactory to the Company and its transfer agent of the right of such Notice of Exercise, issued in your name person or in such other name or names persons to exercise this Option. D. The Optionee shall make arrangements satisfactory to the Company for the satisfaction of any immediate family member designated withholding tax obligations that arise in such Notice of Exercise. The Option shall be deemed to have been exercised and such Shares shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record of such Shares as of the date that such Notice of Exercise and payment shall have been received by the Company.connection with her

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Registered Holder on or before the Termination Date, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as Exhibit I duly executed by the Registered Holder at the principal executive offices of the Option is $0.25Company, or at such other office or agency as the Company may designate, accompanied by payment in full, in lawful money of the United States, of the Warrant Price payable in respect of the number of Warrant Shares purchased upon such exercise. The Option may only "Warrant Price" shall initially be exercised if it becomes exercisable pursuant $2.23 and from time to time shall be such amount adjusted in accordance with Section 22 hereof; provided, however, that the Warrant Price shall never be less than $0.05 (the “Warrant Price Floor”). (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above (the “Exercise Date”). At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1(d) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such certificates. (c) As soon as practicable after the exercise of this Warrant in full or in part, and in any event within twenty (20) days thereafter, the Company, at its expense, will cause to be issued in the name of, and delivered to, the Registered Holder, or as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of Warrant Shares as of to which the Registered Holder shall be entitled upon such exercise; and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, calling in the aggregate on the face or faces thereof for the number of Warrant Shares equal (without giving effect to any adjustment therein) to the number of such Notice shares called for on the face of Exercise and payment shall have been received this Warrant minus the number of such shares purchased by the CompanyRegistered Holder upon such exercise.

Exercise. (a) The Exercise Price per share Subject to the provisions of Sections 4, 7 and 8, the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Option Warrants, when evidenced by a Warrant Certificate, may be exercised by at a price (ithe "Exercise Price") providing written notice to of $1.00 per share, in whole or in part, commencing on the Company in date of issuance (the form prescribed "Initial Exercise Date") and terminating on June 30, 2002, unless extended by the stockholders from time to time Company's Board of Directors (the "Exercise Period"), at any time and from time to time after during such period that the Option becomes exercisable in accordance Company's Registration Statement with Section 2 (the “Notice of Exercise”), which Notice of Exercise shall be delivered respect to the Warrant Shares is effective and current. The Company in shall promptly notify the formWarrant Agent of the effectiveness of such Registration Statement, any suspension of effectiveness and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of any such extension of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of ExercisePeriods. The Option A Warrant shall be deemed to have been exercised and such Shares immediately prior to the close of business on the date (the "Exercise Date") of the surrender for exercise of the Warrant Certificate. The exercise form shall be deemed executed by the Registered Holder thereof or his attorney duly authorized in writing and will be delivered together with payment to have been issuedthe Warrant Agent at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, and you ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, (the "Corporate Office") or such other family member(s) place as designated by the Company, in cash or by official bank or certified check, of an amount equal to the aggregate Exercise Price, in lawful money of the United States of America. Unless Warrant Shares may not be issued as provided herein, the person entitled to receive the number of Warrant Shares deliverable on such Notice of Exercise exercise shall be deemed treated for all purposes to have become a as the holder of record of such Warrant Shares as of the date close of business on the Exercise date. In addition, the Warrant Agent shall also, at such time, verify that such Notice all of Exercise and payment shall the conditions precedent to the issuance of Warrant Shares set forth in Section 4 have been received satisfied as of the Exercise Date. If any one of the conditions precedent set forth in Section 4 are not satisfied as of the Exercise Date, the Warrant Agent shall request written instructions from the Company as to whether to return the Warrant and pertinent Exercise Price to the exercising Registered Holder or to hold the same until all such conditions have been satisfied. The Company shall not be obligated to issue any fractional share interests in Warrant Shares issuable or deliverable on the exercise of any Warrant or scrip or cash therefor and such fractional shares shall be of no value whatsoever. If more than one Warrant shall be exercised at one time by the same Registered Holder, the number of full Shares which shall be issuable on exercise thereof shall be computed on the basis of the aggregate number of full shares issuable on such exercise. Within thirty days after the Exercise Date and in any event prior to the pertinent Expiration Date, the Warrant Agent shall cause to be issued and delivered to the person or persons entitled to receive the same, a certificate or certificates for the number of Warrant Shares deliverable on such exercise. No adjustment shall be made in respect of cash dividends on Warrant Shares delivered on exercise of any Warrant. The Warrant Agent shall promptly notify the Company in writing of any exercise and of the number of Warrant Shares delivered and shall cause payment of an amount in cash equal to the pertinent Exercise Price to be promptly made to the order of the Company. Upon the exercise of any Warrant, the Warrant Agent shall promptly deposit the payment into a segregated account established by mutual agreement of the Company and the Warrant Agent at a federally insured commercial bank. All funds deposited in the escrow account will be disbursed on a weekly basis to the Company once they have been determined by the Warrant Agent to be collected funds. Once the funds are determined to be collected the Warrant Agent shall cause the share certificate(s) representing the exercised Warrants to be issued. Expenses incurred by the Warrant Agent while acting in the capacity as Warrant Agent will be paid by the Company. These expenses, including delivery of exercised share certificates to the shareholder, will be deducted from the exercise fee submitted prior to distribution of funds to the Company. A detailed accounting statement relating to the number of shares exercised and the net amount of exercised funds remitted will be given to the Company with the payment of each exercise amount. This will serve as an interim accounting for the Company's use during the exercise periods. A complete accounting will be made by the Warrant Agent to the Company concerning all persons exercising Warrants, the number of shares issued and the amounts paid at the completion of the Exercise Period. The Company may deem and treat the Registered Holder of the Warrants at any time as the absolute owner thereof for all purposes, and the Company shall not be affected by any notice to the contrary. The Warrants shall not entitle the holder thereof to any of the rights of shareholders or to any dividend declared on the Common Stock unless the holder shall have exercised the Warrants and purchased the shares of Common Stock prior to the record date fixed by the Board of Directors of the Company for the determination of holders of Common Stock entitled to such dividend or other right.

Exercise. (a) The Exercise Price per share of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Option Each Warrant may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time Registered Holder thereof at any time and from time to time on or after the Option becomes exercisable in accordance with Section 2 (Initial Exercise Date, but not after the “Notice of Exercise”)Warrant Expiration Date, which Notice of Exercise shall be delivered upon the terms and subject to the Company in the form, conditions set forth herein and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per shareapplicable Warrant Certificate. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option A Warrant shall be deemed to have been exercised immediately prior to the close of business on the Exercise Date and the person entitled to receive the securities deliverable upon such Shares exercise shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed treated for all purposes to have become a as the holder of record those securities upon the exercise of such Shares the Warrant as of the close of business on the Exercise Date. As soon as practicable on or after the Exercise Date, the Warrant Agent shall deposit the proceeds received from the exercise of a Warrant and shall notify the Company in writing of the exercise of the Warrants. Promptly following, and in any event within five days after the date of such notice from the Warrant Agent, the Warrant Agent, on behalf of the Company, shall cause to be issued and delivered by the Transfer Agent, to the person or persons entitled to receive the same, a certificate or certificates for the securities deliverable upon such exercise, (plus a Warrant Certificate for any remaining unexercised Warrants of the Registered Holder) unless prior to the date of issuance of such certificates the Company shall instruct the Warrant Agent to refrain from causing such issuance of certificates pending clearance of checks received in payment of the Purchase Price pursuant to such Warrants. Notwithstanding the foregoing, in the case of payment made in the form of a check drawn on an account of the Underwriter or such other investment banks and brokerage houses as the Company shall approve in writing to the Warrant Agent, certificates shall immediately be issued without prior notice to the Company or any delay. Upon the exercise of any Warrant and clearance of the funds received, the Warrant Agent shall promptly remit the payment received for the Warrant (the "Warrant Proceeds") to the Company or as the Company may direct in writing, subject to the provisions of Sections 4(b) and 4(c) hereof. (b) If, at the Exercise Date in respect of the exercise of any Warrant after __________, 1998, (i) the market price of the Company's Common Stock is greater than the then Purchase Price of the Warrant, (ii) the exercise of the Warrant was solicited by a member of the National Association of Securities Dealers, Inc. ("NASD") as designated in writing on the Warrant Certificate Subscription Form, (iii) the Warrant was not held in a discretionary account, (iv) disclosure of compensation arrangements was made both at the time of the original offering and at the time of exercise; and (v) the solicitation of the exercise of the Warrant was not in violation of Regulation M (as such rule or any successor rule may be in effect as of such time of exercise) promulgated under the Securities Exchange Act of 1934, then the Warrant Agent, simultaneously with the distribution of the Warrant Proceeds to the Company shall, on behalf of the Company, pay from the Warrant Proceeds, a fee of 5% (the "Exercise Fee") of the Purchase Price to the Underwriter (of which a portion may be reallowed by the Underwriter to the dealer who solicited the exercise, which may also be the Underwriter or ▇.▇. ▇▇▇▇▇ & Co., Inc.). In the event the Exercise Fee is not received within five days of the date on which the Company receives Warrant Proceeds, then the Exercise Fee shall begin accruing interest at an annual rate of prime plus four percent (4%), payable by the Company to the Underwriter at the time the Underwriter receives the Exercise Fee. Within five days after exercise the Warrant Agent shall send to the Underwriter a copy of the reverse side of each Warrant exercised. The Underwriter shall reimburse the Warrant Agent, upon request, for its reasonable expenses relating to compliance with this section 4(b). The Company shall pay all fees and expenses including all blue sky fees and expenses and all out-of-pocket expenses of the Underwriter, including legal fees, in connection with the solicitation, redemption or exchange of the Warrants. In addition, the Underwriter and the Company may at any time during business hours, examine the records of the Warrant Agent, including its ledger of original Warrant Certificates returned to the Warrant Agent upon exercise of Warrants. The provisions of this paragraph may not be modified, amended or deleted without the prior written consent of the Underwriter. (c) In order to enforce the provisions of Section 4(b) above, in the event there is any dispute or question as to the amount or payment of the Exercise Fee, the Warrant Agent is hereby expressly authorized to withhold payment to the Company of the Warrant Proceeds unless and until the Company establishes an escrow account for the purpose of depositing the entire amount of the Exercise Fee, which amount will be deducted from the net Warrant Proceeds to be paid to the Company. The funds placed in the escrow account may not be released to the Company without a written agreement from the Underwriter that such Notice of the required Exercise and payment shall have Fee has been received by the CompanyUnderwriter.

Exercise. Provided that the Company Election Notice, all Investor Election Notices and all Second Investor Election Notices, collectively constitute an offer to purchase all of such Offered Shares, then within ten (a10) The Exercise Price per share days of receipt of the Option is $0.25. The Option Company Election Notice, the Investor Election Notice, and the Second Investor Election Notice, as the case may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Option may be exercised by (i) providing written notice to be, either the Company or any Non-Selling Investor, or both (in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (each case, the “Notice of ExerciseElecting Party”), which Notice shall deliver to the Selling Investor (by certified check or wire transfer in immediately available funds to an account specified by the Selling Investor) the purchase price of Exercise such Offered Shares to be purchased by the Electing Party, and the Selling Investor shall deliver stock certificates duly endorsed for Transfer or with duly executed stock powers or similar instruments, or such other instrument of Transfer of such Transferred Shares as may be reasonably requested by the Electing Party with all stock transfer taxes paid and stamps affixed. If any Governmental Approval is required in connection with any such purchase of Offered Shares and such Governmental Approval has not been completed or obtained on or prior to the date scheduled for closing, the closing of the purchase of all Offered Shares shall take place on the third Business Day after such Governmental Approval has been completed or obtained. The Selling Investor and the Electing Party shall each use reasonable efforts to complete or obtain any such required Governmental Approval; provided, however, that neither the Selling Investor nor the Electing Party shall be delivered required to agree to any divestiture or operational constraint or pay any material amount of money (other than the filing fee payable in connection with any notification required under the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of 1976, as amended, or in connection with any notification or filing under any foreign competition laws which shall be paid by such Electing Party) as a condition of obtaining such Governmental Approval. If each of the Parties has acted in good faith to complete or obtain any such required Governmental Approval and such Governmental Approval has not been completed or obtained on or before the date which is ninety (90) days after receipt by the Selling Investor of the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and paymentElection Notice, the Company shall issue Investor Election Notice or cause to be issuedthe Second Investor Election Notice, in accordance with such Notice of Exerciseas the case may be, the number proposed sale of Offered Shares specified in subject to such Notice of Exerciserequired Governmental Approval shall be cancelled with respect to such Electing Party and, issued in your name or in for all purposes, such other name or names of any immediate family member designated in such Notice of Exercise. The Option Electing Party shall be deemed to have been exercised elected not to purchase such Offered Shares pursuant to this Section 2, and the Selling Investor shall be free to Transfer the Offered Shares to (i) any Non-Selling Investors, if any remain, and the Company in accordance with this Section 2; provided, that the right of each of the Company and such Non-Selling Investors set forth in this Section 2 will be void ab initio if the Company and such Non-Selling Investors, collectively, offer to purchase less than all of the Offered Shares or (ii) in the absence of any remaining Non-Selling Investor, the Offeror. Each Electing Party shall only be required to give customary representations and warranties, including legal authority and capacity, non-contravention of other agreements to which it is a party and customary stock investor representations. Each Electing Party shall be deemed required to have been issuedenter into any instrument, undertaking or obligation necessary or reasonably requested and you deliver all documents necessary or other family member(sreasonably requested in connection with such sale (as specified in the Transfer Notice) designated in such Notice of Exercise shall be deemed for all purposes as a condition to have become a holder of record the exercise of such holder’s rights to Transfer Shares as of the date that such Notice of Exercise and payment shall have been received by the Companyunder this Section 2.

Exercise. (a) 4.1 The Exercise Price per share Purchase Rights represented by this Warrant are exercisable upon the terms and conditions set forth herein at the option of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Option may be exercised by (i) providing written notice to the Company Holder in the form prescribed by the stockholders from whole at any time to time and in part, but not for less than 100 shares at a time, at any time and from time to time after during the Option becomes exercisable in accordance with Section 2 (Exercise Period upon the “Notice delivery of Exercise”), which the Notice of Exercise shall be delivered form attached hereto as Exhibit 1 to the Company with such notice duly executed and upon payment in the formcash, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage wire transfer or bank cashier’s check of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of ExercisePrice. The Option Purchase Rights shall be deemed to have been exercised exercised, and such Shares the Holder shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder stockholder of record of such Shares the Company for the purposes of receiving dividends and for all other purposes whatsoever with respect to the shares of Common Stock so purchased, as of the date that of delivery of such Notice properly executed notice accompanied by proper tender of the Exercise and payment shall have been received by Price at the office of the Company. As promptly as practicable on or after such date, and in any event within three (3) business days thereafter, the Company at its expense shall issue and deliver, or cause to be issued and delivered, to the person or persons entitled to receive the same, a certificate or certificates for the number of shares issuable upon such exercise. In the event that this Warrant is exercised in part, the Company at its expense shall execute and deliver a new Warrant of like tenor exercisable for the number of shares for which this Warrant may then be exercised. 4.2 In lieu of the payment methods set forth in Section 4.1 above, in the event the Warrant Shares have not been registered under an effective registration statement filed pursuant to the Securities Act prior to the earlier of: (i) one (1) year from the Issue Date of this Warrant; or (ii) the closing of the Qualified Public Offering, the Holder may elect to exchange all or some of this Warrant for shares of Common Stock equal to the value of the amount of the Warrant being exchanged on the date of exchange. If Holder elects to exchange this Warrant as provided in this Section 4.2, Holder shall tender to the Company the Warrant for the amount being exchanged, along with written notice of Holder’s election to exchange some or all of the Warrant, and the Company shall issue to Holder the number of shares of the Common Stock computed using the following formula:

Exercise. Subject to the provisions, limitations and other relevant provisions of the Plan and of this Agreement, and the earlier expiration of the Option as herein provided, Employee may exercise the Option to purchase some or all of the Shares as follows: (a) The Exercise Price per share Option shall become exercisable in three cumulative equal annual installments as follows: (i) on the first anniversary of the Option is $0.25. The Option may only be exercised if it becomes Effective Date, the right to purchase one-third of the aggregate number of Shares shall become exercisable pursuant without further action by the Committee; (ii) on the second anniversary of the Effective Date, the right to Section 2purchase an additional one-third of the aggregate number of Shares shall become exercisable without further action by the Committee; and (iii) on the third anniversary of the Effective Date, the right to purchase the remaining one-third of the aggregate number of Shares shall become exercisable without further action by the Committee. (b) The Option may be exercised by (i) providing written notice to Notwithstanding any other provision of this Agreement, the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage unexercised portion of the Exercise Price per share represented by Option, if any, will automatically and without notice terminate and become null and void upon the fractional purchaseexpiration of ten (10) years from the Effective Date of the Option. (c) Payment Any exercise by Employee of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the sameOption, or (ii) if portion thereof, shall be conducted by delivery of an irrevocable notice of exercise to the Shares are not readily tradable on Company or its designee as provided in the Plan. In no event shall Employee be entitled to exercise the Option for less than a national securities market, by any method pre-approved by the Companywhole Share. (d) As soon as practicable but not later than five Business Days after Notwithstanding any other provision of this Agreement, upon the Company shall have received such Notice occurrence of Exercise and paymenta Change in Control, the Company Option shall issue become fully vested and immediately exercisable in full on the date of the Change in Control. For purposes hereof, “Change in Control” shall mean the occurrence of any of the following events: (i) a merger of Dynegy with another entity, a consolidation involving Dynegy, or cause the sale of all or substantially all of the assets or equity interests of Dynegy to another entity if, in any such case, (A) the holders of equity securities of Dynegy immediately prior to such event do not beneficially own immediately after such event equity securities of the resulting entity entitled to fifty-one percent (51%) or more of the votes then eligible to be issuedcast in the election of directors (or comparable governing body) of the resulting entity in substantially the same proportions that they owned the equity securities of Dynegy immediately prior to such event or (B) the persons who were members of the Board immediately prior to such event do not constitute at least a majority of the board of directors of the resulting entity immediately after such event; (ii) a circumstance where any person or entity, including a “group” as contemplated by Section 13(d)(3) of the Exchange Act, acquires or gains ownership or control (including, without limitation, power to vote) of fifty percent (50%) or more of the combined voting power of the outstanding securities of, (A) if Dynegy has not engaged in a merger or consolidation, Dynegy, or (B) if Dynegy has engaged in a merger or consolidation, the resulting entity; or (iii) circumstances where, as a result of or in connection with, a contested election of directors, the persons who were members of the Board immediately before such election shall cease to constitute a majority of the Board. For purposes of the “Change in Control” definition, (1) “resulting entity” in the context of an event that is a merger, consolidation or sale of all or substantially all of the subject assets or equity interests shall mean the surviving entity (or acquiring entity in the case of an asset or equity interest sale), unless the surviving entity (or acquiring entity in the case of an asset sale) is a subsidiary of another entity and the holders of common stock of Dynegy receive capital stock of such other entity in such transaction or event, in accordance with which event the resulting entity shall be such Notice other entity, and (2) subsequent to the consummation of Exercisea merger or consolidation that does not constitute a Change in Control, the number term “Dynegy” shall refer to the resulting entity and the term “Board” shall refer to the board of Shares specified in such Notice of Exercise, issued in your name directors (or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option shall be deemed to have been exercised and such Shares shall be deemed to have been issued, and you or other family member(scomparable governing body) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record of such Shares as of the date that such Notice of Exercise and payment shall have been received by the Companyresulting entity.

Exercise. (a) The Exercise Price per share of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Option Each Class D Warrant may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time Registered Holder thereof at any time and from time to time on or after the Option becomes exercisable in accordance with Section 2 (Initial Exercise Date, but not after the “Notice of Exercise”)Warrant Expiration Date, which Notice of Exercise shall be delivered upon the terms and subject to the Company in the form, conditions set forth herein and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per shareapplicable Warrant Certificate. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option A Class D Warrant shall be deemed to have been exercised immediately prior to the close of business on the Exercise Date and the person entitled to receive the securities deliverable upon such Shares exercise shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed treated for all purposes to have become a as the holder of record those securities upon the exercise of such Shares the Class D Warrant as of the close of business on the Exercise Date. As soon as practicable on or after the Exercise Date the Warrant Agent shall deposit the proceeds received from the exercise of a Class D Warrant and shall notify the Company in writing of the exercise of the Class D Warrants. Promptly following, and in any event within five days after the date that of such Notice notice from the Warrant Agent, the Warrant Agent, on behalf of the Company, shall cause to be issued and delivered by the Transfer Agent, to the person or persons entitled to receive the same, a certificate or certificates for the securities deliverable upon such exercise (plus a certificate for any remaining unexercised Class D Warrants of the Registered Holder). In the case of payment made in the form of a check drawn on an account of Paramount or such other investment banks and brokerage houses as the Company shall approve in writing to the Warrant Agent, certificates shall immediately be issued without prior notice to the Company nor any delay. Upon the exercise of any Class D Warrant and clearance of the funds received, the Warrant Agent shall promptly remit the payment received for the Class D Warrant (the "Warrant Proceeds") to the Company or as the Company may direct in writing, subject to the provisions of Subsections 4(b) and 4(c). (b) On the Exercise Date in respect of the exercise of any Class D Warrant, the Warrant Agent shall, simultaneously with the distribution of the Warrant Proceeds to the Company, on behalf of the Company, pay from the Warrant Proceeds, a fee of 5% (the "Paramount Fee") of the Purchase Price to Paramount for Class D Warrant exercises solicited by Paramount or its representatives (of which a portion may be reallowed by Paramount to the dealer who solicited the exercise, which may also be Paramount). In the event the Paramount Fee is not received within seven days of the date on which the Company receives Warrant Proceeds, then the Paramount Fee shall begin accruing interest at an annual rate 300 basis points above prime payable by the Company to Paramount at the time Paramount receives the Paramount Fee. Within five days after exercise the Warrant Agent shall send Paramount a copy of the reverse side of each Class D Warrant exercised. In addition, Paramount and payment the Company may at any time during business hours, examine the records of the Warrant Agent, including its ledger of original Warrant Certificates returned to the Warrant Agent upon exercise of Class D Warrants. Paramount is intended by the parties hereto to be, and is, a third-party beneficiary of this Agreement. The provisions of this paragraph may not be modified, amended or deleted without the prior written consent of Paramount. In addition to the foregoing, any costs incurred by Paramount shall have been received be promptly reimbursed by the Company. (c) In order to enforce the provisions of Subsection 4(b) above, in the event there is any dispute or question as to the amount or payment of the Paramount Fee, the Warrant Agent is hereby expressly authorized to withhold payment to the Company of the Warrant Proceeds unless and until the Company establishes an escrow account for the purpose of depositing the entire amount of the unpaid Paramount Fee claimed by Paramount, which amount will be deducted from the net Warrant Proceeds to be paid to the Company. The funds placed in the escrow account may not be released to the Company without a written agreement from Paramount that the required Paramount Fee has been received by Paramount. Paramount shall promptly notify the Warrant Agent by facsimile and certified mail in the event of any such dispute or when the Paramount Fee has been paid.

Exercise. (a) The This Warrant may be exercised one time, in whole or minimum increments of 10,000 shares, on any business day on or before the expiration date listed above by presentation and surrender hereof to the Corporation at its principal office of a written exercise request and the Exercise Price per share in lawful money of the Option is $0.25United States of America in the form of a wire transfer or check, subject to collection, for the Warrant Shares specified in the exercise request. If this Warrant should be exercised in part only, the Company shall, upon surrender of this Warrant, execute and deliver a new Warrant evidencing the rights of the Holder hereof to purchase the balance of the Warrant Shares purchasable hereunder. Upon receipt by the Corporation of an exercise request and representations, together with proper payment of the Exercise Price, at such office, the Holder shall be deemed to be the holder of record of the Warrant Shares, notwithstanding that the stock transfer books of the Corporation shall then be closed or that certificates representing such Warrant Shares shall not then be actually delivered to the Holder. The Option may only be exercised if it becomes exercisable pursuant to Section 2Corporation shall pay any and all transfer agent fees, documentary stamp or similar issue or transfer taxes payable in respect of the issue or delivery of the Warrant Shares. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at At any time and during the period from time issuance to time after expiration (the Option becomes exercisable "Exercise Period"), the Holder may, at its option, exchange this Warrant, in whole or minimum increments of 10,000 shares (a "Warrant Exchange"), into the number of Warrant Shares determined in accordance with this Section 2 (the “Notice of Exercise”1)(b), which Notice of Exercise shall be delivered to by surrendering this Warrant at the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval principal office of the Company, (i) if the Shares are readily tradable on accompanied by a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received written notice stating such Notice of Exercise and payment, the Company shall issue or cause Holder's intent to be issued, in accordance with effect such Notice of Exerciseexchange, the number of Warrant Shares to be exchanged and the date on which the Holder requests that such Warrant Exchange occur (the "Notice of Exchange"). The Warrant Exchange shall take place on the date the Notice of Exchange is received by the Company or such later date as may be specified in such the Notice of ExerciseExchange (the "Exchange Date"). Certificates for the shares issuable upon such Warrant Exchange and, issued in your name or in such other name or names if applicable, a new Warrant of any immediate family member designated in such Notice like tenor evidencing the balance of Exercise. The Option the shares remaining subject to this Warrant, shall be deemed to have been exercised and such Shares shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record of such Shares issued as of the date that such Exchange Date and delivered to the Holder within ten (10) days following the Exchange Date. In connection with any Warrant Exchange, this Warrant shall represent the right to subscribe for and acquire the number of Warrant Shares (rounded to the next highest integer) equal to (i) the number of Warrant Shares specified by the Holder in its Notice of Exchange (the "Total Number") less (ii) the number of Warrant Shares equal to the quotient obtained by dividing (A) the product of the Total Number and the existing Exercise and payment Price by (B) the current market value of a share of Common Stock. Current market value shall have been received by be the Companyaverage closing trading price for the 5 trading day period prior to the Exchange Date.

Exercise. (a) The Exercise Price per share purchase rights set forth in this Warrant are exercisable by the Warrantholder, in whole or in part, at any time, or from time to time, prior to the expiration of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to term set forth in Section 2. (b) The Option may be exercised , by (i) providing written notice tendering to the Company at its principal office a notice of exercise in the form prescribed by attached to the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 Credit Agreement as Exhibit I (the “Notice of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, duly completed and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per shareexecuted. If permitted by the Company, this Option may be exercised in fractions by paying the percentage Promptly upon receipt of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and paymentthe payment of the Purchase Price in accordance with the terms set forth below, and in no event later than three (3) days thereafter, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the Warrantholder a certificate for the number of Shares specified shares of Common Stock purchased and shall execute the acknowledgment of exercise in such Notice the form attached to the Credit Agreement as Exhibit II (the “Acknowledgment of Exercise”) indicating the number of shares which remain subject to future purchases, issued if any. Except as provided in your name or in such other name or names the following sentence, each exercise of any immediate family member designated in such Notice of Exercise. The Option this Warrant shall be deemed to have been effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in the paragraph above. Notwithstanding the foregoing, if an exercise of all or any portion of this Warrant is being made in connection with (i) a proposed Acquisition, (ii) a proposed issuance or sale of, or dividend or distribution in respect of, capital stock or any other securities of the Company, or (iii) a proposed transfer of capital stock or other securities of the Company, then, at the election of the Warrantholder, such exercise may be conditioned upon the consummation of such public offering, Acquisition, issuance, sale, dividend, distribution or transfer, in which case (A) such exercise shall be effective concurrently with the consummation of such public offering, Acquisition, issuance, sale, dividend, distribution or transfer, and (B) appropriate modifications will be made to the Notice of Exercise to reflect the conditionality specified in this sentence. The Purchase Price may be paid at the Warrantholder’s election either (i) by cash or check, or (ii) by surrender of all or a portion of the Warrant for shares of Common Stock to be exercised and under this Warrant and, if applicable, an amended Warrant representing the remaining number of shares purchasable hereunder, as determined below (“Net Issuance”). If the Warrantholder elects the Net Issuance method, the Company will issue Common Stock in accordance with the following formula: X = Y(A-B) A Where: X = the number of shares of Common Stock to be issued to the Warrantholder. Y = the number of shares of Common Stock requested to be exercised under this Warrant. A = the fair market value of one (1) share of Common Stock at the time of issuance of such Shares shares of Common Stock. B = the Exercise Price. For purposes of the above calculation, current fair market value of Common Stock shall mean with respect to each share of Common Stock: (i) if the Common Stock is traded on a securities exchange, the fair market value shall be deemed to have been issuedbe the average of the closing prices over a five (5) day period ending three days before the day the current fair market value of one (1) share of Common Stock is being determined; or (ii) if the Common Stock is traded over-the-counter, and you or other family member(s) designated in such Notice of Exercise the fair market value shall be deemed for all purposes to have become a holder of record of such Shares as be the average of the date that such Notice closing bid and asked prices quoted on the NASDAQ system (or similar system) over the five (5) day period ending three days before the day the current fair market value of Exercise and payment one (1) share of Common Stock is being determined; or (iii) if at any time the Common Stock is not listed on any securities exchange or quoted in The NASDAQ Stock Market or the over-the-counter market, the current fair market value of Common Stock shall have been be the highest price per share which the Company could obtain from a willing buyer (not a current employee or director) for shares of Common Stock sold by the Company, from authorized but unissued shares, as determined in good faith by its Board of Directors, unless the Company shall become subject to an Acquisition, in which case the fair market value of Common Stock shall be deemed to be the per share value received by the Companyholders of Common Stock pursuant to such Acquisition. Upon partial exercise by either cash or Net Issuance, the Company shall promptly issue an amended Warrant representing the remaining number of shares purchasable hereunder. All other terms and conditions of such amended Warrant shall be identical to those contained herein, including, but not limited to the Effective Date hereof.

Exercise. (a) The Exercise Price Subject to the provisions of Sections 5 and 9 hereof, the Series A Warrants, as they may be adjusted as set forth herein, may be exercised at a price (the "WARRANT EXERCISE PRICE") of $2.75 per share of Common Stock subject to adjustment, in whole or in part at any time during the Option period (the "WARRANT EXERCISE PERIOD") commencing on the date of issuance of the Series A Warrant and terminating on the earlier of (i) the date three years after effectiveness of the Initial Registration Statement, provided, however, that (x) if the Common Stock underlying the Warrants is $0.25. The Option may only not subject to an effective registration for an aggregate of 600 days within three years after the final closing of the Private Offering, then the remaining exercise period under this clause (i) shall be exercised if it becomes exercisable pursuant tolled until the Common Stock underlying the Warrants shall have been subject to Section 2an effective registration for an aggregate of 600 days and (y) in no event shall the Series A Warrants terminate under this clause (i) unless a registration statement covering the Warrant Shares shall have then been in effect for 45 days prior to such termination, and (ii) six years from the date of issuance (the "WARRANT EXPIRATION DATE"), unless extended by a majority vote of the Board of Directors for such length of time as they, in their sole discretion, deem reasonable and necessary. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Each Series A Warrant shall be deemed to have been exercised and such Shares immediately prior to the close of business on the date (each, an "EXERCISE DATE") of the surrender to the Company for exercise of the Series A Warrant certificate. The exercise form shall be deemed to have been issued, executed by the Warrant Holder thereof or his attorney duly authorized in writing and you or other family member(s) designated in such Notice of Exercise shall be deemed delivered together with payment to the Company at its corporate offices located at ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇ (the "CORPORATE OFFICE"), or at any such other office or agency as the Company may designate, in cash or by official bank or certified check, of an amount equal to the aggregate Exercise Price, in lawful money of the United States of America. (c) Unless Warrant Shares may not be issued as provided herein, the person entitled to receive the number of Warrant Shares deliverable on exercise shall be treated for all purposes to have become a as the holder of record of such Warrant Shares as of the date that close of business on the Exercise Date. The Company shall not be obligated to issue any fractional share interest in Warrant Shares issuable or deliverable on the exercise of any Series A Warrant or scrip or cash therefore and such Notice fractional shares shall be of no value whatsoever. (d) Within ten days after the Exercise Date and payment in any event prior to the Warrant Expiration Date, the Company, at its own expense, shall cause to be issued and delivered to the person or persons entitled to receive the same, a certificate or certificates in the name requested by the Registered Holder for the number of Warrant Shares deliverable on such exercise. No adjustment shall be made in respect of cash dividends on Warrant Shares delivered on exercise of any Series A Warrant. All shares of Common Stock delivered upon the exercise of the Series A Warrants shall be validly issued, fully paid and non-assessable. Any Series A Warrants redelivered to the Registered Holder in the event of the exercise of less than all of the Series A Warrants pertaining to a surrendered Series A Warrant certificate, shall be validly issued, fully paid and non-assessable. (e) The Series A Warrants shall not entitle the holder thereof to any of the rights of shareholders or to any dividend declared on the Common Stock unless such holder or holders shall have been received exercised the Series A Warrants prior to the record date fixed by the CompanyBoard of Directors for the determination of holders of Common Stock entitled to such dividends or other rights.

Exercise. (a) The This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as Exhibit I duly executed by such Registered Holder, at the principal office of the Company, or at such other office or agency as the Company may designate, accompanied by payment in full, in lawful money of the United States, of the Exercise Price per share payable in respect of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2number of shares of Warrant Stock being purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which the Warrant shall have been surrendered to the Company as provided in subsection 1(a) above. At such Shares time, the person or persons in whose name or names any certificates for Warrant Stock shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issuedbecome the holder or holders of record of the Warrant Stock represented by such certificates. (c) As soon as practicable after the exercise of this Warrant in full or in part, and you in any event within 10 days thereafter, the Company at its expense will cause to be issued in the name of, and delivered to, the Registered Holder, or, subject to the terms and conditions hereof, as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct: (i) a certificate or other family member(scertificates for the number of full shares of Warrant Stock to which such Registered Holder shall be entitled upon such exercise, and (ii) designated in case such Notice exercise is in part only, a new warrant or warrants (dated the date hereof) of like tenor, calling in the aggregate on the face or faces thereof for the number of shares of Warrant Stock equal (without giving effect to any adjustment therein) to the number of such shares called for on the face of this Warrant, minus the number of such shares purchased by the Registered Holder upon such exercise as provided in subsection 1(a) above. (d) In lieu of the payment of the Exercise Price in the manner required by Section 1(a), the Holder shall have the right (but not the obligation) to pay the Exercise Price for the shares of Common Stock being purchased with this Warrant upon exercise by the surrender to the Company of any exercisable but unexercised portion of this Warrant having a "Value" (as defined below), at the close of trading on the last trading day immediately preceding the exercise of this Warrant, equal to the Exercise Price multiplied by the number of shares of Common Stock being purchased upon exercise ("Cashless Exercise Right"). The sum of (x) the number of shares of Common Stock being purchased upon exercise of the non-surrendered portion of this Warrant pursuant to this Cashless Exercise Right and (y) the number of shares of Common Stock underlying the portion of this Warrant being surrendered, shall not in any event be greater than the total number of shares of Common Stock purchasable upon the complete exercise of this Warrant if the Exercise Price were paid in cash. The "Value" of the portion of the Warrant being surrendered shall equal the remainder derived from subtracting (x) the Exercise Price multiplied by the number of shares of Common Stock underlying the portion of this Warrant being surrendered from (y) the Market Price of a share of Common Stock multiplied by the number of shares of Common Stock underlying the portion of this Warrant being surrendered. As used in this Warrant, the term "Market Price" at any date shall be deemed for all purposes to have become a holder of record of such Shares as be the last reported sale price of the date that Common Stock on such Notice date, or, in case no such reported sale takes place on such day, the average of Exercise and payment shall have been received the last reported sale price for the immediately preceding three trading days, in either case as officially reported by the national securities exchange on which the Common Stock is trading, or, if the Common Stock is not principally traded on any national securities exchange, the last reported sale price as furnished by the NASD through the Nasdaq National Market or SmallCap Market, or, if applicable, the OTC Bulletin Board, or if the Common Stock is not listed or admitted to trading on the Nasdaq National Market or SmallCap Market or OTC Bulletin Board or similar organization, as determined in good faith by resolution of the Board of Directors of the Company, based on the best information available to it. The Cashless Exercise Right may be exercised by the Holder on any business day on or after the Commencement Date and not later than the Expiration Date by delivering the Warrant with a duly executed exercise form attached hereto with the cashless exercise section completed to the Company, exercising the Cashless Exercise Right and specifying the total number of shares of Common Stock being purchased pursuant to such Cashless Exercise Right.

Exercise. (a) The This Warrant may be exercised by the Registered Holder by surrendering this Warrant, along with the purchase form appended hereto as Exhibit A duly executed and completed by the Registered Holder or by the Registered Holder’s duly authorized attorney, at the principal office of the Company, or at such other office or agency as the Company may designate by notice in writing to the Registered Holder, accompanied by either (i) cash or certified cashier’s check payable to the Company (or wire transfer of immediately available funds), in lawful money of the United States, of the Exercise Price per share payable in respect of the Option number of Warrant Shares purchased upon such exercise (the “Aggregate Exercise Price”), or (ii) a written notice to the Company that the Registered Holder is $0.25. The Option may only exercising this Warrant on a “cashless” exercise basis by authorizing the Company to withhold from issuance a number of shares of Common Stock issuable upon such exercise of the Warrant which when multiplied by the Fair Market Value (as defined in Article 3 hereof) of the Common Stock is equal to the Aggregate Exercise Price (and such withheld shares shall no longer be exercised if it becomes exercisable pursuant to Section 2issuable under this Warrant). (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised effected immediately prior to the close of business on the day on which this Warrant and the completed purchase form shall have been surrendered to the Company as provided in subsection 1(a) above (the “Exercise Date”). At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such certificates. (c) Within ten (10) days after the date of exercise of this Warrant, the Company, at its expense, will cause to be issued in the name of, and delivered to, the Registered Holder, or as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct, a certificate or certificates for the number of full Warrant Shares as to which the Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which the Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof; provided, however, that the Company shall not be required to pay any tax that may be payable in respect of any transfer involving the issuance and delivery of any such certificate upon exercise in a name other than that of the date Registered Holder and the Company shall not be required to issue or deliver certificates until the person or person requesting the issuance thereof shall have paid the Company the amount of tax or shall have established to the Company that such Notice tax has been paid. Notwithstanding the foregoing, the Registered Holder shall be solely responsible for any income taxes payable and arising from the issuance or exercise of Exercise this Warrant, or any ad valorem property or intangible tax assessed against the Registered Holder. (d) The Company shall assist and payment shall have been received cooperate with any Registered Holder required to make any governmental filings or obtain any governmental approvals prior to or in connection with any exercise of this Warrant (including, without limitation, making any filings required to be made by the Company). (e) Notwithstanding any other provision of this Warrant, if the exercise of all or any portion of this Warrant is to be made in connection with a registered public offering, a sale of the Company or any other transaction or event, such exercise may, at the election of the Registered Holder, be conditioned upon consummation of such transaction or event in which case such exercise shall not be deemed effective until the consummation of such transaction or event.

Exercise. (a) The Exercise Price per share Any or all of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Option Warrants represented by each Warrant Certificate may be exercised by the holder thereof on any business day on or before 5:00 p.m. Minneapolis time on _________, 2003 (i) providing written notice the "Expiration Date"), by surrender of the Warrant Certificate with the purchase form, which is printed on the reverse thereof, duly executed by such holder, to the Company Warrant Agent at its principal office in South St. ▇▇▇▇, Minnesota. The purchase form must be accompanied by payment, in cash or by certified check payable to the form prescribed Company, in an amount equal to the product of the number of shares of Common Stock issuable upon exercise of the Warrants represented by such Warrant Certificate, as adjusted pursuant to the provisions of Article III hereof, multiplied by the stockholders exercise price of $_____ (125% of the average of the last reported sale prices of the Company's Common Stock on the Nasdaq National Market (symbol "PDSF") for the ten trading days immediately prior to the date of the Prospectus), as adjusted pursuant to the provisions of Article III hereof (such price as so adjusted from time to time being referred to as the "Purchase Price"), and such holder shall be entitled to receive such number of fully paid and nonassessable shares of Common Stock, as so adjusted, at any the time and from time to time after of such exercise. If a registration statement under the Option becomes exercisable in accordance with Section 2 Securities Act of 1933, as amended (the “Notice of Exercise”"Securities Act"), which Notice covering the shares of Exercise Common Stock issuable upon exercise of the Warrants is not effective on the Expiration Date and any of the Warrants remain outstanding on the Expiration Date, in such case, the Expiration Date shall be delivered extended until such time as a registration becomes effective and the Warrant shall then remain exercisable for a period of 90 calendar days from the date the Company delivers to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage Warrantholders written notice of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option shall be deemed to have been exercised and such Shares shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record availability of such Shares as of the date that such Notice of Exercise and payment shall have been received by the Companyregistration.

Exercise. (a) The Exercise Price per share Warrants in denominations of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Option one or whole number multiples thereof may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time commencing at any time and from time to time on or after the Option becomes exercisable in accordance with Section 2 (Initial Warrant Exercise Date, but not after the “Notice of Exercise”)Warrant Expiration Date, which Notice of Exercise shall be delivered upon the terms and subject to the Company conditions set forth herein (including the provisions set forth in the form, Sections 5 and 9 hereof) and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per shareapplicable Warrant Certificate. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option A Warrant shall be deemed to have been exercised and immediately prior to the close of business on the Exercise Date, provided that the Warrant Certificate representing such Shares Warrant, with the exercise form thereon duly executed by the Registered Holder thereof or his attorney duly authorized in writing, together with payment in cash or by check made payable to the Warrant Agent for the account of the Company, of an amount in lawful money of the United States of America equal to the applicable Purchase Price has been received in good funds by the Warrant Agent. The person entitled to receive the securities deliverable upon such exercise shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed treated for all purposes to have become a as the holder of record of such Shares securities as of the close of business on the Exercise Date. As soon as practicable on or after the Exercise Date and in any event within five business days after having received authorization from the Company, the Warrant Agent on behalf of the Company shall cause to be issued to the person or persons entitled to receive the same a Common Stock certificate or certificates for the shares of Common Stock deliverable upon such exercise, and the Warrant Agent shall deliver the same to the person or persons entitled thereto. Upon the exercise of any Warrant, the Warrant Agent shall promptly notify the Company in writing of such fact and of the number of securities delivered upon such exercise and, subject to subsection (b) below, shall cause all payments of an amount in cash or by check made payable to the order of the Company, equal to the Purchase Price, to be deposited promptly in the Company's bank account. (b) At any time upon the exercise of any Warrants after one (1) year and one day from the date hereof, the Warrant Agent shall, on a daily basis, within two business days after such exercise, notify the Underwriter, and its and their successors or assigns, of the exercise of any such Warrants and shall, on a weekly basis (subject to collection of funds constituting the tendered Purchase Price, but in no event later than five business days after the last day of the calendar week in which such funds were tendered), remit to the Underwriter (so long as the Underwriter solicited the exercise of such Warrant as indicated upon the Subscription Form attached to the Warrant Certificate tendered for exercise), an amount equal to seven percent (7%) of the Purchase Price of such Warrants being then exercised if written certification is received that (i) the Warrant is exercised at least 12 months after the date of this Prospectus; (ii) the market price of the Common Stock on the date that such Notice the Warrant is exercised is greater than the exercise price of Exercise the Warrants; (iii) the exercise of the Warrants was solicited by a member of the National Association of Securities Dealers, Inc.; (iv) the Warrant is not held in a discretionary account; (v) disclosure of the compensation arrangements is made at the time of the exercise of the Warrant; (vi) the holder of the Warrant has stated in writing that the exercise was solicited and payment shall have been received by designated in writing the Company.soliciting broker-dealer; and

Exercise. (a) The This Warrant may be exercised in whole or in part by the Registered Holder by surrendering this Warrant, along with the purchase form appended hereto as Exhibit A duly executed and completed by the Registered Holder or by the Registered Holder’s duly authorized attorney, at the principal office of the Company, or at such other office or agency as the Company may designate by notice in writing to the Registered Holder, accompanied by cash or certified cashier’s check payable to the Company (or wire transfer of immediately available funds), in lawful money of the United States, of the Exercise Price per share payable in respect of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2number of Warrant Shares purchased upon such exercise (the “Aggregate Exercise Price”). (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above (the “Exercise Date”). At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such Shares as of certificates. (c) Within ten (10) days after the date that of exercise of this Warrant, the Company, at its expense, will cause to be issued in the name of, and delivered to, the Registered Holder, or as such Notice Holder (upon payment by such Holder of Exercise any applicable transfer taxes) may direct, a certificate or certificates for the number of full Warrant Shares to which the Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which the Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof. Notwithstanding the foregoing, the Registered Holder shall be solely responsible for any income taxes payable and payment arising from the issuance or exercise of this Warrant, or any ad valorem property or intangible tax assessed against the Registered Holder. (d) The Company shall have been received assist and cooperate with any Registered Holder required to make any governmental filings or obtain any governmental approvals prior to or in connection with any exercise of this Warrant (including, without limitation, making any filings required to be made by the Company). (e) Notwithstanding any other provision of this Warrant, if the exercise of all or any portion of this Warrant is to be made in connection with a registered public offering, a sale of the Company or any other transaction or event, such exercise may, at the election of the Registered Holder, be conditioned upon consummation of such transaction or event in which case such exercise shall not be deemed effective until the consummation of such transaction or event.

Exercise. (a) The This Warrant may be exercised by the Registered Holder, in whole or in part, by the surrender of this Warrant (with the Notice of Exercise Form attached hereto duly executed by such Registered Holder) at the principal office of the Company, or at such other office or agency as the Company may designate, accompanied by payment in full, in lawful money of the United States, of an amount equal to the then applicable Exercise Price per share multiplied by the number of Warrant Shares then being purchased upon such exercise, subject to the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to cashless exercise provisions set forth in Section 22.3(b) of this Warrant. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above, if so surrendered prior to 5:00 p.m., New York City time, or if surrendered after 5:00 p.m., New York City time, as of the next business day. At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1(c), below, shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such Shares as certificates. (c) Unless exercising this Warrant in its entirety (or the then existing remainder of this Warrant in its entirety), exercises hereunder shall be only in full share increments. Within five (5) business days after the exercise of the purchase right represented by this Warrant, the Company at its expense will use its best efforts to cause to be issued in the name of, and delivered to, the Registered Holder, or, subject to the terms and conditions hereof (including the requirement that there be a registration statement then in effect with respect to transfers or an exemption therefrom), to such other individual or entity as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full Warrant Shares to which such Registered Holder shall be entitled upon such exercise (and, in lieu of any fractional share to which such Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof), and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, stating on the face or faces thereof the number of shares currently stated on the face of this Warrant minus the number of such Notice of Exercise and payment shall have been received shares purchased by the CompanyRegistered Holder upon such exercise as provided in subsection 1(a) above.

Exercise. (a) The Exercise Price per share SARs shall vest and become exercisable in equal annual installments (which shall be cumulative) on each of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant first four anniversaries of the Grant Date (i.e., one quarter per year), provided that the Participant has not incurred a Termination of Employment prior to Section 2the applicable vesting date. (b) The Option may be exercised by (i) providing written notice to If the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated Participant’s Termination is an involuntary Termination by the Company from time without Cause, for Good Reason (as defined in the Participant’s employment agreement with the Company), or due to time, and (ii) paying the Exercise Price per share. If permitted non-renewal by the Company of such employment agreement , or upon the Participant’s death or Disability (or term or concept of like import, as defined in the Participant’s employment agreement with the Company), this Option may be exercised in fractions by paying the percentage SARs shall become vested and exercisable with respect to the number of Shares that would have vested if the Exercise Price per share represented by the fractional purchaseParticipant’s employment had continued for an additional twelve month period. (c) Payment The SARs will become fully vested upon a Change in Control, if the Participant remains employed or is otherwise performing services for the Company at the time of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” Change in accordance with a Company-established policy Control or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved had an involuntarily Termination by the CompanyCompany without Cause at any time during the 30 day period before the Change in Control. (d) As soon as practicable but not later than five Business Days after To the Company shall extent that the SARs have received such Notice of Exercise become vested and payment, the Company shall issue or cause exercisable with respect to be issued, in accordance with such Notice of Exercise, the a number of Shares specified of Common Stock as provided herein, the SARs may thereafter be exercised by the Participant, in such Notice of Exercise, issued in your name whole or in such other name part, at any time or names from time to time prior to the expiration of the term of the SARs by the filing of any immediate family member designated in such Notice written form of Exerciseexercise notice as may be required by the Committee. The Option Upon expiration of the SARs, the SARs shall be deemed canceled and no longer exercisable. There shall be no proportionate or partial vesting in the periods prior to have been exercised each vesting date and all vesting shall occur only on the applicable vesting date. (e) The provisions of Section 7.4(b) of the Plan regarding Detrimental Activity shall apply to the SARs, and such Shares shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record of such Shares as of the date that such Notice of Exercise and payment shall have been received provisions are incorporated herein by the Companyreference.

Exercise. (a) The This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, along with the purchase form appended hereto as EXHIBIT A duly executed and completed by the Registered Holder or by the Registered Holder's duly authorized attorney, at the principal office of the Company, or at such other office or agency as the Company may designate by notice in writing to the Registered Holder, accompanied by either cash or certified cashier's check payable to the Company (or wire transfer of immediately available funds), in lawful money of the United States, of the Exercise Price per share payable in respect of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2number of Warrant Shares purchased upon such exercise (the "AGGREGATE EXERCISE PRICE"). (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above (the "EXERCISE DATE"). At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such certificates. (c) Within fifteen (15) days after the date of exercise of this Warrant, the Company, at its expense, will cause to be issued in the name of, and delivered to, the Registered Holder, or as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full Warrant Shares as to which the Registered Holder shall be entitled upon such exercise; and (ii) a new Warrant representing the shares with respect to which this Warrant shall not have been exercised (unless this Warrant has been fully exercised or has expired); PROVIDED, HOWEVER, that the Company shall not be required to pay any tax that may be payable in respect of any transfer involving the issuance and delivery of any such certificate upon exercise in a name other than that of the date Registered Holder and the Company shall not be required to issue or deliver certificates until the person or person requesting the issuance thereof shall have paid the Company the amount of tax or shall have established to the Company that such Notice tax has been paid. Notwithstanding the foregoing, the Registered Holder shall be solely responsible for any income taxes payable and arising from the issuance or exercise of Exercise and payment this Warrant, or any AD VALOREM property or intangible tax assessed against the Registered Holder. (d) Notwithstanding any other provision of this Warrant, the right to exercise this Warrant shall have been received by terminate prior to July 2, 2009, upon the sale of all or substantially all of the capital stock, assets or business of the Company, by merger, consolidation, sale of assets or otherwise in which the Registered Holder would be entitled to cash or securities traded on a national security exchange, the Nasdaq Stock Market, or an over-the-counter market in exchange for the Warrant Shares (other than a merger or consolidation in which all or substantially all of the individuals and entities who were beneficial owners of the Common Stock immediately prior to such transaction beneficially own, directly or indirectly, more than 50% of the outstanding securities entitled to vote generally in the election of directors of the resulting, surviving or acquiring corporation in such transaction).

Exercise. (a) The Exercise Price per share This Option shall be exercisable as follows: This Option shall become first exercisable in part at the end of the first year following the date of grant; thereafter, the Optionee may purchase by exercise of this Option is $0.25an aggregate of up to twenty-five percent (25%) of the total number of Shares subject to this Option until the end of the next year; an aggregate of up to fifty percent (50%) of such Shares until the end of the year following that; an aggregate of up to seventy-five percent (75%) of such Shares until the end of the year following that, in each case calculated to the nearest full share. The Each of the years just mentioned shall be a period ending on an anniversary date of this Agreement. At any time on or after the fourth such anniversary date until this Option expires, the Optionee may only be exercised if it becomes exercisable pursuant purchase all or any part of the Shares subject to Section 2this Option which Optionee theretofore has not purchased. (b) The This Option shall remain exercisable as to all of such Shares until ten (10) years from the date of grant of this Option, unless this Option has expired or terminated earlier in accordance with the provisions hereof. Shares as to which this Option becomes exercisable pursuant to the foregoing provision may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time purchased at any time and from time prior to time after the Option becomes exercisable in accordance with Section 2 (the “Notice expiration of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchaseOption. (c) Payment Notwithstanding the preceding provisions of this paragraph, upon delivery of notice from the Company of the Exercise Price per share may pendency of dissolution or liquidation of the Company or a reorganization, merger, or consolidation of the Company with one or more corporations as a result of which the Company will not be madethe surviving corporation or a sale of substantially all the assets and property of the Company to another person (a "Terminating Event") , this Option shall be exercisable as to those Shares with respect to which installments, if any, have then accrued. Thirty (30) days after delivery of said notice, this Option or any portion hereof not exercised shall terminate, unless provision be made in connection with the Terminating Event for assumption of this Option or for substitution of new options for this Option covering an equivalent amount of stock of a successor employer corporation, or a parent or subsidiary corporation thereof, solely at your electionthe election of such successor corporation or parent or subsidiary corporation, with the approval appropriate adjustments as to number and kind of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Companyshares and prices. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The This Option shall be deemed subject to have been exercised adjustments in price and number of shares to reflect any stock split, stock dividend, recapitalization, reincorporation, or similar event (other than those specified in (c) above), to preserve, but not increase, the benefits of the Optionee, so that immediately after such Shares event the Optionee shall be deemed entitled, upon payment to have been issuedthe Company of the aggregate exercise price under this Option, and you to receive that number of shares or other family member(s) designated property that Optionee would have received had Optionee exercised this Option in full immediately prior to such Notice of Exercise shall be deemed for all purposes to have become a holder of record of such Shares as of the date that such Notice of Exercise and payment shall have been received by the Companyevent.

Exercise. (a) The This Warrant may be exercised by the Registered Holder, only during the Exercise Price per share Period, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as Exhibit A duly executed by such Registered Holder, at the principal office of the Option is $0.25Company, or at such other office or agency as the Company may designate, accompanied by payment in full, in lawful money of the United States, of the Purchase Price payable in respect of the number of shares of Warrant Stock purchased upon such exercise. The Option may only This Warrant shall be exercised if it becomes exercisable pursuant to Section 2vested on the date hereof. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which the Warrant shall have been surrendered to the Company as provided in Subsection 1(a) above. At such Shares time, the person or persons in whose name or names any certificates for Warrant Stock shall be issuable upon such exercise as provided in Subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Stock represented by such Shares certificates. (c) As soon as practicable after the exercise of this Warrant in full or in part, and in any event within three (3) business days thereafter, the Company at its expense will cause to be issued in the name of, and delivered to, the Registered Holder, or, subject to the terms and conditions hereof, as such Registered Holder (upon payment by such Registered Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full shares of Warrant Stock to which such Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which such Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof; and (ii) in case such exercise is in part only, a new Warrant or Warrants (dated the date that hereof) of like tenor, calling in the aggregate on the face or faces thereof for the number of shares of Warrant Stock equal (without giving effect to any adjustment therein) to the number of such Notice shares called for on the face of Exercise and payment shall have been received this Warrant, less the number of such shares of Warrant Stock purchased by the CompanyRegistered Holder upon such exercise as provided in Subsection 1(a) above. (d) Unless registered under the Securities Act of 1933, as amended (the "Act"), each certificate for Warrant Stock purchased upon exercise of this Warrant shall bear a legend as follows, unless the Warrant Stock has been registered under the Act: "The securities represented by this certificate have not been registered under the Securities Act of 1933, as amended (the "Act"), or applicable state law. The securities may not be offered for sale, sold or otherwise transferred except pursuant to an effective registration statement under the Act, or pursuant to an exemption from registration under the Act and applicable state law."

Exercise. (a) The This Warrant may be exercised by the Registered Holder, in whole or in part, by the surrender of this Warrant (with the Notice of Exercise Form attached hereto duly executed by such Registered Holder) at the principal office of the Company, or at such other office or agency as the Company may designate, accompanied by payment in full, in lawful money of the United States, of an amount equal to the then applicable Exercise Price per share multiplied by the number of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2Warrant Shares then being purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above. At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such Shares as certificates. (c) Within three business days after the exercise of the purchase right represented by this Warrant, the Company at its expense will use its best efforts to cause to be issued in the name of, and delivered to, the Registered Holder, or, subject to the terms and conditions hereof, to such other individual or entity as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full shares of Warrant Shares to which such Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which such Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof, and (ii) in case such exercise is in part only, a new Warrant or Warrants (dated the date that hereof) of like tenor, stating on the face or faces thereof the number of shares currently stated on the face of this Warrant minus the number of such Notice of Exercise and payment shall have been received shares purchased by the Registered Holder upon such exercise as provided in subsection 1(a) above (prior to any adjustments made thereto pursuant to the provisions of this Warrant). (d) The Company shall not be required upon the exercise of this Warrant to issue any fractional shares, but shall make an adjustment thereof in cash on the basis of the last sale price (as defined in Section 3) of the Company's Common Stock on the trading day immediately prior to the date of exercise, applicable.

Exercise. (a) The Exercise Price per share Each of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Option Warrants may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders at any time or from time to time at any time and from time to time on or after the Option becomes exercisable Closing Date and prior to the earlier of (i) six (6) years from the date the Note is paid in accordance with Section 2 full or (ii) ten (10) years from the “Notice date hereof, on any day that is a Business Day, for all or any part of Exercise”)the number of Issuable Warrant Shares purchasable upon its exercise. In order to exercise any Warrant, which Notice of Exercise shall be delivered in whole or in part, the Holder will deliver to the Company in at the form, and in the manner, address designated by the Company from time pursuant to timeSection 6.06, (x) a written notice of such Holder's election to exercise its Warrant, which notice will specify the number of Issuable Warrant Shares to be purchased pursuant to such exercise, (y) payment of the Exercise Price, in an amount equal to the aggregate purchase price for all Issuable Warrant Shares to be purchased pursuant to such exercise, and (iiz) paying the Exercise Price per shareWarrant. If permitted by Such notice will be substantially in the Company, this Option may be exercised in fractions by paying the percentage form of the Exercise Price per share represented by Subscription Form appearing at the fractional purchase. (c) Payment end of the Exercise Price per share may be made, at your election, with the approval Warrants. Upon receipt of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and paymentnotice, the Company shall issue will, as promptly as practicable, and in any event within ten (10) Business Days (or such longer period of time as is reasonably necessary to complete any required calculations or determinations), execute, or cause to be issuedexecuted, in accordance with and deliver to such Notice of Exercise, Holder a certificate or certificates representing the aggregate number of Shares full shares of Common Stock and Other Securities issuable upon such exercise, as provided in this Agreement. The stock certificate or certificates so delivered will be in such denominations as may be specified in such Notice notice and will be registered in the name of Exercisesuch Holder, issued in your name or in such other name or names of any immediate family member as designated in such Notice of Exercisenotice. The Option shall Warrants will be deemed to have been exercised and exercised, such Shares shall certificate or certificates will be deemed to have been issued, and you such Holder or any other family member(s) Person so designated or named in such Notice of Exercise shall notice will be deemed for all purposes to have become a holder of record of such Shares shares for all purposes, as of the date that such Notice notice, together with payment of the Exercise Price and payment shall have been the Warrant, is received by the Company. If the Warrant has been exercised in part, the Company will, at the time of delivery of such certificate or certificates, deliver to such Holder a new Warrant evidencing the rights of such Holder to purchase a number of Issuable Warrant Shares with respect to which the Warrant has not been exercised, which new Warrant will, in all other respects, be identical with the Warrants, or, at the request of such Holder, appropriate notation may be made on the Warrant and the Warrant returned to such Holder. (b) Payment of the Exercise Price will be made, at the option of the Holder, by (i) company or individual check, certified or official bank check, (ii) cancellation of any debt and/or accrued interest owed by the Company to the Holder, or (iii) cancellation of Warrant Shares, valued at Fair Market Value (but no Appraised Value shall be required for purposes of this calculation). If the Holder surrenders a combination of cash or cancellation of any debt owed by the Company to the Holder or Warrants, the Holder will specify the respective number of shares of Common Stock to be purchased with each form of consideration, and the foregoing provisions will be applied to each form of consideration with the same effect as if the Warrant were being separately exercised with respect to each form of consideration; provided, however, that a Holder may designate that any cash to be remitted to a Holder in payment of debt be applied, together with other monies, to the exercise of the portion of the Warrant being exercised for cash; provided further, that so long as any amounts due under the Note remain outstanding, Holder will first apply such outstanding debt due under the Note towards the cost of exercising Warrants before applying any value in Warrants or Warrant Shares towards such exercise cost, but only if, such priority does not result in a greater tax liability than if Holder applied such outstanding debt due under the Note towards the cost of exercising Warrants after applying any value in Warrants or Warrant Shares towards such exercise cost.

Exercise. (a) The This Warrant may be exercised by the Registered Holder, in whole or in part, by the surrender of this Warrant (with the Notice of Exercise Form attached hereto duly executed by such Registered Holder) at the principal office of the Company, or at such other office or agency as the Company may designate, accompanied by payment in full, in lawful money of the United States, of an amount equal to the then applicable Exercise Price per share multiplied by the number of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2Warrant Shares then being purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above. At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such Shares as certificates. (c) Within five (5) business days after the exercise of the purchase right represented by this Warrant, the Company at its expense will use its best efforts to cause to be issued in the name of, and delivered to, the Registered Holder, or, subject to the terms and conditions hereof, to such other individual or entity as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full shares of Warrant Shares to which such Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which such Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof, and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, stating on the face or faces thereof the number of shares of Common Stock currently stated on the face of this Warrant minus the number of such Notice shares of Exercise and payment shall have been received Common Stock purchased by the CompanyRegistered Holder upon such exercise as provided in subsection 1(a) above.

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as EXHIBIT A, duly executed by such Holder, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant to Section 2designate, accompanied by payment in full by bank or certified check in lawful money of the United States, of the aggregate Purchase Price payable in respect of the total number of shares of Common Stock purchased upon such exercise. (b) The Option may Each exercise of this Warrant shall be exercised deemed to have been effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in SUBSECTION 2(a) above. At such time, the person or persons in whose name or names any certificates for or other instruments evidencing shares of Common Stock shall be issuable upon such exercise as provided in SUBSECTION 2(d) below shall be deemed to have become the holder or holders of record of the Common Stock represented by such certificates or other instruments. (i) providing written notice to the Company in the form prescribed by the stockholders from time to time The Holder may at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice of Exercise”), which Notice of Exercise shall be delivered to the Company in the formits sole option, and in lieu of paying the mannerPurchase Price pursuant to SUBSECTION 2(a) hereof, designated exchange this Warrant in whole or in part for a number of shares of Common Stock as determined below. Such shares of Common Stock shall be issued by the Company from time to timethe Holder without payment by the Holder of any other exercise price or any cash or other consideration. The number of shares of Common Stock to be so issued to the Holder shall be equal to the quotient obtained by dividing (A) the Surrendered Value (as defined below) on the date of surrender of this Warrant pursuant to SUBSECTION 2(a), and by (b) the Fair Market Value on the exchange date of one share of Common Stock. (ii) paying For the Exercise Price per share. If permitted by purposes of this SUBSECTION 2(c), the Company, "SURRENDERED VALUE" of a portion of this Option may Warrant on a given date shall be exercised in fractions by paying deemed to be the percentage difference between (A) the aggregate Fair Market Value on such date of the Exercise Price per share represented by the fractional purchase. (c) Payment total number of shares of Common Stock otherwise issuable upon exercise of such portion of the Exercise Warrant, MINUS (B) the aggregate Purchase Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Companysuch total number of shares of Common Stock. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice exercise of Exercise this Warrant in full or in part, and paymentin any event within three (3) business days thereafter, the Company shall issue or Company, at its expense, will cause to be issuedissued in the name of, in accordance with and delivered to, the Holder, or, subject to the terms and conditions hereof, as such Notice Holder (upon payment by such Holder of Exercise, any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of Shares specified full shares of Common Stock to which such Holder shall be entitled upon such exercise, PLUS, in such Notice of Exercise, issued in your name or in such other name or names lieu of any immediate family member designated fractional share to which such Holder would otherwise be entitled, cash in an amount determined pursuant to SECTION 3 hereof, and (ii) in case such Notice exercise is in part only, a new warrant or warrants (dated the date hereof) of Exercise. The Option shall be deemed like tenor, calling in the aggregate on the face or faces thereof for the number of shares of Common Stock equal (without giving effect to have been exercised and such Shares shall be deemed any adjustment therein) to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record the Warrant Number minus the number of such Shares as shares of the date that such Notice of Exercise and payment shall have been received Common Stock purchased by the CompanyHolder upon such exercise.

Exercise. (a) The Exercise Price per share of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Option Each Warrant may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time Registered Holder thereof at any time and from time to time on or after the Option becomes exercisable in accordance with Section 2 (Initial Exercise Date, but not after the “Notice of Exercise”)Warrant Expiration Date, which Notice of Exercise shall be delivered upon the terms and subject to the Company in the form, conditions set forth herein and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per shareapplicable Warrant Certificate. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option A Warrant shall be deemed to have been exercised immediately prior to the close of business on the Exercise Date and the person entitled to receive the securities deliverable upon such Shares exercise shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed treated for all purposes to have become a as the holder of record those securities upon the exercise of such Shares the Warrant as of the close of business on the Exercise Date. As soon as practicable on or after the Exercise Date, the Warrant Agent shall deposit the proceeds received from the exercise of a Warrant and shall notify the Company in writing of the exercise of the Warrants. Promptly following, and in any event within five days after the date of such notice from the Warrant Agent, the Warrant Agent, on behalf of the Company, shall cause to be issued and delivered by the Transfer Agent, to the person or persons entitled to receive the same, a certificate or certificates for the securities deliverable upon such exercise, (plus a Warrant Certificate for any remaining unexercised Warrants of the Registered Holder), unless prior to the date of issuance of such certificates the Company shall instruct the Warrant Agent to refrain from causing such issuance of certificates pending clearance of checks received in payment of the Purchase Price pursuant to such Warrants. Notwithstanding the foregoing, in the case of payment made in the form of a check drawn on an account of Royce or CBDC or such other investment banks and brokerage houses as the Company shall approve in writing to the Warrant Agent, certificates shall immediately be issued without prior notice to the Company or any delay. Upon the exercise of any Warrant and clearance of the funds received, the Warrant Agent shall promptly remit the payment received for the Warrant (the "Warrant Proceeds") to the Company or as the Company may direct in writing, subject to the provisions of Sections 4(b) and 4(c) hereof. (b) If, at the Exercise Date in respect of the exercise of any Warrant after December 5, 1997, (i) the market price of the Company's Common Stock is greater than the then Purchase Price of the Warrant, (ii) the exercise of the Warrant was solicited by a member of the National Association of Securities Dealers, Inc. ("NASD") as designated in writing on the Warrant Certificate Subscription Form, (iii) the Warrant was not held in a discretionary account, (iv) disclosure of compensation arrangements was made both at the time of the original offering and at the time of exercise; and (v) the solicitation of the exercise of the Warrant was not in violation of Rule 10b-6 (as such rule or any successor rule may be in effect as of such time of exercise) promulgated under the Securities Exchange Act of 1934, then the Warrant Agent, simultaneously with the distribution of the Warrant Proceeds to the Company shall, on behalf of the Company, pay from the Warrant Proceeds, a fee of five percent (5%) (the "Solicitation Fee") of the Purchase Price to Royce, as Representative of the Underwriters; provided that such Notice of Exercise and payment either Royce or CBDC shall have solicited the exercise of the applicable warrant as evidenced in writing in the Warrant Certificate Subscription Form. Upon receipt of the solicitation fee from the Warrant Agent, Royce shall in turn, if and as applicable, forward all (in the event that CBDC solicited the exercise of the applicable warrant as evidenced in writing in the Warrant Certificate Subscription Form) or, if unclear whether CBDC solicited the exercise of the applicable warrant, a portion of the Solicitation Fee to CBDC, to the extent that Royce, in its sole discretion shall determine (of which a portion may be reallowed to the dealer who solicited the exercise, which may also be an Underwriter). In the event the Solicitation Fee is not received within five days of the date on which the Company receives Warrant Proceeds, then the Solicitation Fee shall begin accruing interest at an annual rate of prime plus four percent (4%), payable by the Company to the Underwriters at the time the Underwriters receives the Solicitation Fee. Within five days after exercise the Warrant Agent shall send to the Underwriters a copy of the reverse side of each Warrant exercised. The Underwriters shall reimburse the Warrant Agent, upon request, for its reasonable expenses relating to compliance with this Section 4(b). In addition, the Underwriters and the Company may at any time during business hours, examine the records of the Warrant Agent, including its ledger of original Warrant Certificates returned to the Warrant Agent upon exercise of Warrants. The provisions of this paragraph may not be modified, amended or deleted without the prior written consent of the Underwriters. (c) In order to enforce the provisions of Section 4(b) above, in the event there is any dispute or question as to the amount or payment of the Solicitation Fee, the Warrant Agent is hereby expressly authorized to withhold payment to the Company of the Warrant Proceeds unless and until the Company establishes an escrow account for the purpose of depositing the entire amount of the Solicitation Fee, which amount will be deducted from the net Warrant Proceeds to be paid to the Company. The funds placed in the escrow account may not be released to the Company without a written agreement from Royce that the required Solicitation Fee has been received by the CompanyRoyce.

Exercise. (a) The Exercise Price per share of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Option Each Warrant may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time Registered Holder thereof at any time and from time to time on or after the Option becomes exercisable in accordance with Section 2 (Initial Exercise Date, but not after the “Notice of Exercise”)Warrant Expiration Date, which Notice of Exercise shall be delivered upon the terms and subject to the Company in the form, conditions set forth herein and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per shareapplicable Warrant Certificate. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option A Warrant shall be deemed to have been exercised immediately prior to the close of business on the Exercise Date and the person entitled to receive the securities deliverable upon such Shares exercise shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed treated for all purposes to have become a as the holder of record of such Shares upon exercise thereof as of the close of business on the Exercise Date. As soon as practicable on or after the Exercise Date the Warrant Agent shall deposit the proceeds received from the exercise of a Warrant, and promptly after clearance of checks received in payment of the Exercise Price pursuant to such Warrants, cause to be issued and delivered by the Transfer Agent, to the person or persons entitled to receive the same, a certificate or certificates for the securities deliverable upon such exercise, (plus a certificate for any remaining unexercised Warrants of the Registered Holder). Notwithstanding the foregoing, in the case of payment made in the form of a check drawn on an account of Commonwealth or such other investment banks and brokerage houses as the Company shall approve, certificates shall immediately be issued without any delay. Upon the exercise of any Warrant and clearance of the funds received, the Warrant Agent shall promptly remit the payment received for the Warrant to the Company or as the Company may direct in writing. (b) The Registered Holder may, at its option, exchange this Warrant, in whole or in part (a "Warrant Exchange"), into the number of Warrant Shares determined in accordance with this Section (4)(c), by surrendering the Warrant Certificate at the principal office of the Company or at the office of its stock transfer agent, accompanied by a notice stating such Registered Holder's intent to effect such exchange, the number of Warrant Shares to be exchanged and the date on which the Registered Holder requests that such Warrant Exchange occur (the "Notice of Exercise and payment Exchange"). The Warrant Exchange shall have been take place on the date specified in the Notice of Exchange or, if later, the date the Notice of Exchange is received by the CompanyCompany (the "Exchange Date"). Certificates for the shares issuable upon such Warrant Exchange and, if applicable, a new warrant of like tenor evidencing the balance of the shares remaining subject to such Warrant, shall be issued as of the Exchange Date and delivered to the Registered Holder within seven (7) days following the Exchange Date. In connection with any Warrant Exchange, a Warrant shall represent the right to subscribe for and acquire the number of Warrant Shares (rounded to the next highest integer) equal to (i) the number of Warrant Shares specified by the Registered Holder in its Notice of Exchange (the "Total Number") less (ii) the number of Warrant Shares equal to the quotient obtained by dividing (A) the product of the Total Number and the existing Exercise Price by (B) the current market value of a share of Common Stock. Current market value shall have the meaning set forth Section 10(a) hereof, except that for purposes hereof, the date of exercise, as used in such Section 10(a) hereof, shall mean the Exchange Date.

Exercise. (a) The Exercise Price per share Class A Warrants in denominations of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Option one or whole number multiples thereof may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time commencing at any time and from time to time on or after the Option becomes exercisable in accordance with Section 2 (Initial Warrant Exercise Date, but not after the “Notice of Exercise”)Class A Warrant Expiration Date, which Notice of Exercise shall be delivered upon the terms and subject to the Company conditions set forth herein (including the provisions set forth in the form, Sections 5 and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share9 hereof). If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option A Class A Warrant shall be deemed to have been exercised and immediately prior to the close of business on the Exercise Date, with the exercise form thereon duly executed by the Registered Holder thereof or his attorney duly authorized in writing, together with payment in cash or by check made payable to the Company of an amount in lawful money of the United States of America equal to the applicable Purchase Price, have been received in good funds by the Warrant Agent. The person entitled to receive the securities deliverable upon such Shares exercise shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed treated for all purposes to have become a as the holder of record of such Shares securities as of the date that close of business on the Exercise Date. As soon as practicable, on or after the Exercise Date, the Warrant Agent, on behalf of the Company, shall cause to be issued to the person, or persons entitled to receive the same, a Common Stock certificate, or certificates, for the shares of Common Stock deliverable upon such Notice exercise, The Warrant Agent shall deliver the same to the person, or persons entitled thereto. Upon the exercise of Exercise any Class A Warrants, the Warrant Agent shall promptly notify the Company in writing of such fact and payment of the number of securities delivered upon such exercise, and subject to Section 4(b) hereof, shall have been received cause all payments in cash, or by check made payable to the order of the Company, in respect of the Purchase Price to be deposited promptly in the Company's bank account, or delivered to the Company. (b) The Company shall not be obligated to issue any fractional share interests or fractional warrant interests upon the exercise of any Class A Warrant, or Warrants, nor shall it be obligated to issue scrip or pay cash in lieu of fractional interests. Any fraction equal to or greater than one-half (1/2) shall be rounded up to the next full share or Class A Warrant, as the case may be.

Exercise. (a) The Exercise Price per share of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Option Each Warrant may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time Registered Holder thereof at any time and from time to time on or after the Option becomes exercisable in accordance with Section 2 (Initial Warrant Exercise Date, but not after the “Notice of Exercise”)Warrant Expiration Date, which Notice of Exercise shall be delivered upon the terms and subject to the Company in the form, conditions set forth herein and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per shareapplicable Warrant Certificate. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option A Warrant shall be deemed to have been exercised immediately prior to the close of business on the Exercise Date and the person entitled to receive the securities deliverable upon such Shares exercise shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed treated for all purposes to have become a as the holder of record those securities upon the exercise of such Shares the Warrant as of the close of business on the Exercise Date. As soon as practicable on or after the Exercise Date the Warrant Agent shall deposit the proceeds received from the exercise of a Warrant and shall notify the Company in writing of the exercise of the Warrants. Promptly following, and in any event within five days after the date of such notice from the Warrant Agent, the Warrant Agent, on behalf of the Company, shall cause to be issued and delivered by the Transfer Agent, to the person or persons entitled to receive the same, a certificate or certificates for the securities deliverable upon such exercise, (plus a certificate for any remaining unexercised Warrants of the Registered Holder). In the case of payment made in the form of a check drawn on an account of Paramount or such other investment banks and brokerage houses as the Company shall approve in writing to the Warrant Agent, certificates shall immediately be issued without prior notice to the Company or any delay. Upon the exercise of any Warrant and clearance of the funds received, the Warrant Agent shall promptly remit the payment received for the Warrant (the "Warrant Proceeds") to the Company or as the Company may direct in writing, subject to the provisions of Sections 4(b) and 4(c) hereof. (b) On the Exercise Date in respect of the exercise of any Warrant, the Warrant Agent shall, simultaneously with the distribution of the Warrant Proceeds to the Company, on behalf of the Company, pay from the Warrant Proceeds, a fee of 6% (the "Paramount Fee") of the Purchase Price to Paramount for Warrant exercises solicited by Paramount or its representatives (of which a portion may be reallowed by Paramount to the dealer who solicited the exercise, which may also be Paramount). In the event the Paramount Fee is not received within seven days of the date on which the Company receives Warrant Proceeds, then the Paramount Fee shall begin accruing interest at an annual rate of prime plus three (3)%, payable by the Company to Paramount at the time Paramount receives the Paramount Fee. Within five days after exercise the Warrant Agent shall send Paramount a copy of the reverse side of each Warrant exercised. Paramount shall reimburse the Warrant Agent, upon request, for its reasonable expenses relating to compliance with this section 4(b). In addition, Paramount and the Company may at any time during business hours, examine the records of the Warrant Agent, including its ledger of original Warrant Certificates returned to the Warrant Agent upon exercise of Warrants. The provisions of this paragraph may not be modified, amended or deleted without the prior written consent of Paramount. (c) In order to enforce the provisions of Section 4(b) above, in the event there is any dispute or question as to the amount or payment of the Paramount Fee, the Warrant Agent is hereby expressly authorized to withhold payment to the Company of the Warrant Proceeds unless and until the Company establishes an escrow account for the purpose of depositing the entire amount of the unpaid Paramount Fee, which amount will be deducted from the net Warrant Proceeds to be paid to the Company. The funds placed in the escrow account may not be released to the Company without a written agreement from Paramount that such Notice of Exercise and payment shall have the required Paramount Fee has been received by Paramount. Paramount shall promptly notify the CompanyWarrant Agent by facsimile and certified mail in the event of any such dispute and when the Paramount Fee has been paid.

Exercise. (a) The This Warrant may be exercised by the Registered Holder, in whole or in part, by the surrender of this Warrant (with the Notice of Exercise Form attached hereto duly executed by such Registered Holder) at the principal office of the Company, or at such other office or agency as the Company may designate, accompanied by payment in full, in lawful money of the United States, of an amount equal to the then applicable Exercise Price per share multiplied by the number of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2Warrant Shares then being purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above. At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such Shares as certificates. (1) Within three (3) business days after the exercise of the purchase right represented by this Warrant, the Company at its expense will use its best efforts to cause to be issued in the name of, and delivered to, the Registered Holder, or, subject to the terms and conditions hereof, to such other individual or entity as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct: (1) a certificate or certificates for the number of full shares of Warrant Shares to which such Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which such Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof, and (2) in case such exercise is in part only, a new Warrant or Warrants (dated the date that hereof) of like tenor, stating on the face or faces thereof the number of shares currently stated on the face of this Warrant minus the number of such Notice of Exercise and payment shall have been received shares purchased by the CompanyRegistered Holder upon such exercise as provided in subsection 1(a) above (prior to any adjustments made thereto pursuant to the provisions of this Warrant).

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as Exhibit I duly executed by the Registered Holder or by the Registered Holder’s duly authorized attorney, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant to Section 2designate, accompanied by payment in full, in lawful money of the United States, of the Purchase Price payable in respect of the number of Warrant Shares purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above (the “Exercise Date”). At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1(d) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such certificates. (c) As soon as practicable after the exercise of this Warrant in full or in part, and in any event within 10 days thereafter, the Company, at its expense, will cause to be issued in the name of, and delivered to, the Registered Holder, or as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full Warrant Shares as to which the Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which the Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof; and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, calling in the aggregate on the face or faces thereof for the number of Warrant Shares equal (without giving effect to any adjustment therein) to the number of such Notice shares called for on the face of Exercise and payment shall have been received this Warrant minus the sum of (a) the number of such shares purchased by the CompanyRegistered Holder upon such exercise.

Exercise. (a) The Warrants in denominations of one or whole number multiples thereof may he exercised commencing at any time on or after the Initial Warrant Exercise Price per share Date, but not after the Warrant Expiration Date, upon the terms and subject to the conditions set forth herein (including the provisions set forth in Sections 4(b) and 5 hereof) and in the applicable Warrant Certificate. A Warrant shall be deemed to have been exercised immediately prior to the close of business on the Exercise Date, provided that the Warrant Certificate representing such Warrant, with the exercise form thereon duly executed by the Registered Holder thereof or his attorney duly authorized in writing, together with payment in cash or by check made payable to the Company, of an amount in lawful money of the Option is $0.25United States of America equal to the applicable Purchase Price has been received in good funds by the Warrant Agent. The Option may only person entitled to receive the securities deliverable upon such exercise shall be exercised if it becomes exercisable pursuant treated for all purposes as the holder of such securities as of the close of business on the Exercise Date. As soon as practicable on or after the Exercise Date and in any event within five business days after having received authorization from the Company, the Warrant Agent on behalf of the Company shall cause to Section 2be issued to the person or persons entitled to receive the same a Common Stock certificate or certificates for the shares of Common Stock deliverable upon such exercise, and the Warrant Agent shall deliver the same to the person or persons entitled thereto. Upon the exercise of any Warrant, the Warrant Agent shall promptly notify the Company in writing of such fact and of the number of securities delivered upon such exercise and shall cause all payments of an amount in cash or by check made payable to the order of the Company, equal to the Purchase Price, to be deposited promptly in the Company's bank account. (b) The Option may be exercised by (i) providing written notice In addition to the Company method of payment set forth in Section 4(a) and in lieu of any cash payment required thereunder, the form prescribed by Registered Holder(s) of the stockholders from time to time Warrants shall have the right at any time and from time to time after to exercise the Option becomes exercisable Warrants in accordance with full or in part by surrendering shares of Common Stock or this Warrant in the manner and at the place specified in Section 2 (4(a) as payment of the “Notice aggregate Purchase Price per share for the Warrants to be exercised. The number of Exercise”), which Notice Warrants or shares of Exercise Common Stock to be surrendered in payment of the aggregate Purchase Price for the Warrants to be exercised shall be determined by multiplying the number of Warrants to be exercised by the Purchase Price per share, and then dividing the product thereof by an amount equal to the Fair Market Value per share of Common Stock on the date that all documents and instruments required to be delivered or surrendered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage for exercise of the Exercise Price per share represented by the fractional purchaseWarrant have been so delivered or surrendered. (c) Payment The Company shall not be required to issue fractional shares upon the exercise of Warrants. Warrants may only be exercised in such multiples as are required to permit the issuance by the Company of one or more whole shares. If one or more Warrants shall be presented for exercise at the same time by the same Registered Holder, the number of whole shares which shall be issuable upon such exercise thereof shall be computed on the basis of the Exercise Price per share may be made, at your election, with the approval aggregate number of shares purchasable on exercise of the CompanyWarrants so presented. If any fraction of a share would, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program except for the sameprovisions provided herein, be issuable on the exercise of any Warrant (or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and paymentspecified portion thereof), the Company shall issue or cause pay an amount in cash equal to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option shall be deemed to have been exercised and such Shares shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record of such Shares as of the date that such Notice of Exercise and payment shall have been received fraction multiplied by the Companythen current Fair Market Value of a share of Common Stock.

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as Exhibit A duly executed by such Registered Holder, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant to Section 2designate, accompanied by payment in full, by bank or certified check in lawful money of the United States, of the Purchase Price payable in respect of the number of shares of Warrant Stock purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above. At such Shares time, the person or persons in whose name or names any certificates for Warrant Stock shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Stock represented by such Shares certificates. (c) As soon as practicable after the exercise of this Warrant in full or in part, and in any event within ten (10) days thereafter, the Company at its expense shall cause to be issued in the name of, and delivered to, the Registered Holder, or, subject to the terms and conditions hereof, as the Registered Holder (upon payment by the Registered Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full shares of Warrant Stock to which such Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which such Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof, and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, calling in the aggregate on the face or faces thereof for the number of shares of Warrant Stock equal (without giving effect to any adjustment therein) to the number of such Notice shares called for on the face of Exercise and payment shall have been received this Warrant minus the number of such shares purchased by the CompanyRegistered Holder upon such exercise as provided in subsection 1(a) above.

Exercise. (a) The Subject to the provisions hereof, the Holder may exercise this Warrant, in whole or in part and from time to time, by the surrender of this Warrant (with the Notice of Exercise Price per share attached hereto as Appendix A duly executed) at the principal office of the Option is $0.25. The Option Company, or such other office or agency of the Company as it may only be exercised if it becomes exercisable pursuant reasonably designate by written notice to Section 2the Holder, during normal business hours on any business day, and the payment by the Holder by cash, certified check payable to the Company or wire transfer of immediately available funds to an account designated to the exercising Holder by the Company of an amount equal to the then applicable Warrant Price multiplied by the number of Warrant Shares then being purchased. (b) The Option may be exercised by On the date on which the Holder shall have satisfied in full the Holder's obligations set forth herein regarding an exercise of this Warrant (i) providing written notice provided such date is prior to the Company in Expiration Date), the form prescribed Holder (or such other person or persons as directed by the stockholders from time Holder, subject to time at compliance with applicable securities laws) shall be treated for all purposes as the holder of record of such Warrant Shares as of the close of business on such date. (c) In the event of any time and from time to time after exercise of the Option becomes exercisable in accordance with Section 2 (rights represented by this Warrant, certificates for the “Notice whole number of Exercise”), which Notice shares of Exercise Common Stock so purchased shall be delivered to the Company in the form, and in the manner, designated Holder (or such other person or persons as directed by the Company from time Holder, subject to timecompliance with applicable securities laws) as promptly as is reasonably practicable after such exercise, and (ii) paying and, unless this Warrant has been fully exercised, a new Warrant representing the Exercise Price per share. If permitted by the Companywhole number of Warrant Shares, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your electionif any, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are respect to which this Warrant shall not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option shall be deemed to then have been exercised and such Shares shall also be deemed issued to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record of such Shares the Holder as of the date that such Notice of Exercise and payment shall have been received by the Companysoon as reasonably practicable thereafter.

Exercise. (a) The This Warrant may be exercised by the Registered Holder, in whole or in part, by the surrender of this Warrant (with the Notice of Exercise Price per share Form attached hereto as Exhibit I duly executed by such Registered Holder) at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the, Company may only be exercised if it becomes exercisable pursuant designate, accompanied by payment in full, in lawful money of the United States, of an amount equal to Section 2the then applicable Purchase Price multiplied by the number of Warrant Shares then being purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1 (a) above. At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1 (c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such Shares certificates. (c) As soon as practicable after the exercise of the purchase right represented by this Warrant, the Company at its expense will use its best efforts to cause to be issued in the name of the Registered Holder and delivered to you: (i) a certificate or certificates for the number of full shares of Warrant Shares to which such Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which such Registered Holder would otherwise be entitled, a Warrant Share representing the remainder of the fractional share to the next whole Warrant Share, and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, stating on the face or faces thereof the number of shares currently stated on the face of this Warrant minus the number of such Notice of Exercise and payment shall have been received shares purchased by the CompanyRegistered Holder upon such exercise as provided in subsection 1(a) above.

Exercise. (a) The This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, along with the purchase form appended hereto as Exhibit A duly executed and completed by the Registered Holder or by the Registered Holder’s duly authorized attorney, at the principal office of the Company, or at such other office or agency as the Company may designate by notice in writing to the Registered Holder, accompanied by either (i) cash or certified cashier’s check payable to the Company (or wire transfer of immediately available funds), in lawful money of the United States, of the Exercise Price per share payable in respect of the Option number of Warrant Shares purchased upon such exercise (the “Aggregate Exercise Price”); or (ii) a written notice to the Company that the Registered Holder is $0.25. The Option may only exercising this Warrant on a “cashless” exercise basis by authorizing the Company to withhold from issuance a number of shares of Common Stock issuable upon such exercise of the Warrant which when multiplied by the Fair Market Value of the Common Stock is equal to the Aggregate Exercise Price (and such withheld shares shall no longer be exercised if it becomes exercisable pursuant to Section 2issuable under this Warrant). (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above (the “Exercise Date”). At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such certificates. (c) Promptly after the date of exercise of this Warrant, the Company, at its expense, will cause to be issued in the name of, and delivered to, the Registered Holder, or as such Registered Holder (upon payment by such Registered Holder of any applicable transfer taxes) may direct, a certificate or certificates for the number of full Warrant Shares as to which the Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which the Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof; provided, however, that the Company shall not be required to pay any tax that may be payable in respect of any transfer involving the issuance and delivery of any such certificate upon exercise in a name other than that of the date Registered Holder and the Company shall not be required to issue or deliver certificates until the person or person requesting the issuance thereof shall have paid the Company the amount of tax or shall have established to the Company that such Notice tax has been paid. Notwithstanding the foregoing, the Registered Holder shall be solely responsible for any income taxes payable and arising from the issuance or exercise of Exercise this Warrant, or any ad valorem property or intangible tax assessed against the Registered Holder. (d) The Company shall use commercially reasonable efforts to assist and payment shall have been received cooperate with any Registered Holder required to make any governmental filings or obtain any governmental approvals prior to or in connection with any exercise of this Warrant (including, without limitation, making any filings required to be made by the Company), at the Company’s expense. (e) Notwithstanding any other provision of this Warrant, if the exercise of all or any portion of this Warrant is to be made in connection with a sale of the Company or any other transaction or event, such exercise may, at the election of the Registered Holder, be conditioned upon consummation of such transaction or event in which case such exercise shall not be deemed effective until the consummation of such transaction or event. (f) Notwithstanding any other provision of this Warrant, the right to exercise this Warrant shall terminate prior to the expiration of the Exercise Period upon the first to occur of any of the following (each, a “Liquidity Event”): (i) any consolidation or merger of the Company with or into any other corporation or other entity or entity, or any other corporate reorganization or recapitalization, in which the stockholders of the Company immediately prior to such consolidation, merger, reorganization, or any similar corporate transaction, own less than fifty percent (50%) of the Company’s voting power immediately after such consolidation, merger or reorganization, or any transaction or series of related transactions to which the Company is a party in which in excess of fifty percent (50%) of the Company’s voting power is transferred, excluding any consolidation or merger effected exclusively to change the domicile of the Company; or (ii) (A) a sale, transfer, lease, conveyance or other disposition of all or substantially all of the assets of the Company and its subsidiaries on a consolidated basis to a third party in any transaction or series of related transactions; or (B) the exclusive license of all or substantially all of the intellectual property of the Company to a third party in any transaction or a series of related transactions; provided, however, that the foregoing clause (ii) of this Section shall not apply to an encumbrance of all or substantially all of the Company’s property or business solely in connection with a debt financing.

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Registered Holder, in whole or in part, at any time on or before the Expiration Date (provided that if such date shall fall on a weekend or United States holiday, this Warrant may be exercised on the next succeeding business day), in each case by surrendering this Warrant, with the exercise form attached hereto as Exhibit A duly executed by such Registered Holder, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant to Section 2designate, accompanied by payment in full, in lawful money of the United States, of the Purchase Price payable in respect of the number of Shares purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and such Shares effected immediately prior to the close of business on the day on which this Warrant shall be deemed to have been issuedsurrendered to the Company as provided in subsection 1(a) above (the "Exercise Date"). At such time, and you the person or other family member(spersons in whose name or names any certificates for Shares are to be issuable as provided in subsection 1(c) designated in such Notice of Exercise below shall be deemed for all purposes to have become a the holder or holders of record of the Shares so required to be represented by such certificates. (c) As soon as practicable after the exercise of this Warrant in part and in compliance with subsection 1(a) above, and in any event within ten (10) days thereafter, the Company at its expense will cause to be issued in the name of, and delivered to, the Registered Holder, or, subject to the terms and conditions hereof, to such other person or place as such Registered Holder (upon payment by such Registered Holder of any applicable transfer taxes) may direct, a new warrant or warrants (dated the date hereof) of like tenor, calling in the aggregate on the face or faces thereof for the number of Shares equal (without giving effect to any adjustment therein) to the number of such Shares as called for on the face of this Warrant minus the date that number of such Notice of Exercise and payment shall have been received Shares purchased by the CompanyRegistered Holder upon such exercise as provided in subsection 1(a) above.

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as EXHIBIT I duly executed by such Registered Holder or by such Registered Holders duly authorized attorney, before the Expiration Date, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant to Section 2designate, accompanied by payment in full, in lawful money of the United States, of the Purchase Price payable in respect of the number of Warrant Shares purchased upon such exercise. (b) The Option may be exercised by For purposes of this Warrant, the Expiration Date shall mean not later than 5:00 p.m. (New York, New York time) on the earlier of (i) providing written notice to the Company in the form prescribed 60 days following receipt by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Registered Holder of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated notice by the Company from time of achievement of one of the following two milestones: (x) the initiation by the Company of Phase II clinical studies pursuant to timeU.S. FDA regulations or EMEA regulations (under the U.S. FDA Regulations or the EMEA Regulations, initiation of Phase II is defined as the first entry into a selective group of relevant patients of a company developed compound), or (y) the receipt by the Company of $10,000,000 of gross revenue in a four consecutive fiscal quarter period (gross revenue to mean all revenues of the Company and its subsidiaries, on a consolidated basis, less interest earnings, grants, subsidies and extraordinary items), or (ii) paying five years after the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage date of the Exercise Price per share represented by the fractional purchaseissuance. (c) Payment Each exercise of this Warrant shall be deemed to have been effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered the Company as provided in subsection 1(a) above (the "Exercise Date"). At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1(e) below shall be deemed to have become the holder or holders of record of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Warrant Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, represented by any method pre-approved by the Companysuch certificates. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice exercise of Exercise this Warrant in full or in part, and paymentin any event within 10 days thereafter, the Company shall issue or Company, at its expense, will cause to be issuedissued in the name of, in accordance with and delivered to, the Registered Holder, or as such Notice Holder (upon payment by such Holder of Exercise, any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full Warrant Shares specified to which such Registered Holder shall be entitled upon such exercise plus, in such Notice of Exercise, issued in your name or in such other name or names lieu of any immediate family member designated fractional shares to which such Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof; and (ii) in case such Notice exercise is in part only, a new warrant or warrants (dated the date hereof) of Exercise. The Option shall be deemed like tenor, representing in the aggregate on the face or faces thereof the right to have been exercised and such purchase that number of Warrant Shares shall be deemed equal (without giving effect to have been issued, and you or other family member(sany adjustment therein) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record the number of such Shares as shares called for on the face of this Warrant minus the date that number of such Notice of Exercise and payment shall have been received shares purchased by the CompanyRegistered Holder upon such exercise.

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as Exhibit I duly executed by such Registered Holder or by such Registered Holder's duly authorized attorney, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant to Section 2designate, accompanied by payment in full,in lawful money of the United States, of the Purchase Price payable in respect of the number of shares of Warrant Shares purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above. At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such certificates. (c) As soon as practicable after the exercise of this Warrant in full or in part, and in any event within 10 days thereafter, the Company, at its expense, will cause to be issued in the name of, and delivered to, the Registered Holder, or as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full Warrant Shares as to which such Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which such Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof; and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, calling in the aggregate on the face or faces thereof for the number of Warrant Shares equal (without giving effect to any adjustment therein) to the number of such Notice shares called for on the face of Exercise and payment shall have been received this Warrant minus the number of such shares purchased by the CompanyRegistered Holder upon such exercise as provided in subsection 1(a) above.

Exercise. (a) The Exercise Price per share a. Method of the Option is $0.25Exercise; Payment; Issuance of New Warrant. The Option may only be exercised if it becomes exercisable pursuant ---------------------------------------------------- Subject to Section 2. (b) The Option 1 hereof, the purchase right represented by this Warrant may --------- be exercised by (i) providing written notice to the Company holder hereof, in the form prescribed by the stockholders from time to time at any time whole or in part and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, surrender of this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. Warrant (c) Payment of the Exercise Price per share may be made, at your election, with the approval notice of exercise form attached hereto as Exhibit A duly executed) at the principal office of the Company, and, except --------- as otherwise provided for herein, by the payment to the Company of an amount equal to the then applicable Warrant Price multiplied by the number of Warrant Shares then being purchased (the "Warrant Shares Purchase Price"). The Warrant Shares Purchase Price shall be payable (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the samecash, or (ii) if by cancellation of such amount of loans made pursuant to the Amendment in a principal amount plus accrued interest thereon equal to the Warrant Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of ExercisePurchase Price. The Option person or persons in whose name(s) any certificate(s) representing shares of Common Stock shall be issuable upon exercise of this Warrant shall be deemed to have been exercised become the holder(s) of record of, and shall be treated for all purposes as the record holder(s) of, the shares represented thereby (and such Shares shares shall be deemed to have been issued) immediately prior to the close of business on the date or dates upon which this Warrant is exercised if exercised prior to the close of business on such date; otherwise, and you or other family member(s) designated in such Notice the date of Exercise record shall be deemed for all purposes to have become a holder the next business day. In the event of record of such Shares as any exercise of the date that rights represented by this Warrant, certificates for the shares of Common Stock so purchased shall be delivered to the holder hereof as soon as possible and in any event within thirty (30) days after such Notice exercise and, unless this Warrant has been fully exercised (including without limitation, exercise pursuant to Section 2(b) ------------ below), a new Warrant representing the portion of Exercise and payment the Warrant Shares, if any, with respect to which this Warrant shall not then have been received by exercised shall also be issued to the Companyholder hereof as soon as possible and in any event within such thirty (30)-day period.

Exercise. (a) The This Warrant may be exercised by Registered Holder, in whole or in part, by the surrender of this Warrant (with the Notice of Exercise Price per share Form attached hereto as Exhibit I duly executed by Registered Holder) at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant designate, accompanied by payment in full, in lawful money of the United States, of an amount equal to Section 2.the then applicable Purchase Price multiplied by the number of Warrant Shares then being purchased upon such exercise (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above. At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as providedin subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such Shares certificates. (c) As soon as practicable after the exercise of the purchase right represented by this Warrant, the Company at its expense will use its best efforts to cause to be issued in the name of, and delivered to, Registered Holder, or, subject to the terms and conditions hereof, to such other individual or entity as Registered Holder (upon payment by Registered Holder of any applicable transfer taxes) may direct; (i) a certificate or certificates for the number of full shares of Warrant Shares to which Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof; and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, stating on the face or faces thereof the number of shares currently stated on the face of this Warrant minus the number of such Notice of Exercise and payment shall have been received shares purchased by the CompanyRegistered Holder upon such exercise as provided in subsection 1(a) above.

Exercise. (a) The This Warrant may be exercised by the Registered Holder by surrendering this Warrant, along with the purchase form appended hereto as Exhibit A duly executed and completed by the Registered Holder or by the Registered Holder’s duly authorized attorney, at the principal office of the Company, or at such other office or agency as the Company may designate by notice in writing to the Registered Holder, accompanied by either (i) cash or certified cashier’s check payable to the Company (or wire transfer of immediately available funds), in lawful money of the United States, of the Exercise Price per share payable in respect of the Option number of Warrant Shares purchased upon such exercise (the “AGGREGATE EXERCISE PRICE”) or (ii) a written notice to the Company that the Registered Holder is $0.25. The Option may only exercising this Warrant on a “cashless” exercise basis by authorizing the Company to withhold from issuance a number of shares of Common Stock issuable upon such exercise of the Warrant which when multiplied by the Fair Market Value of the Common Stock is equal to the Aggregate Exercise Price (and such withheld shares shall no longer be exercised if it becomes exercisable pursuant to Section 2issuable under this Warrant). (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above (the “EXERCISE DATE”). At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such certificates. (c) Within ten (10) days after the date of exercise of this Warrant, the Company, at its expense, will cause to be issued in the name of, and delivered to, the Registered Holder, or as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct, a certificate or certificates for the number of full Warrant Shares as to which the Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which the Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof; provided, however, that the Company shall not be required to pay any tax that may be payable in respect of any transfer involving the issuance and delivery of any such certificate upon exercise in a name other than that of the date that such Notice Registered Holder. Notwithstanding the foregoing, the Registered Holder shall be solely responsible for any income taxes payable and arising from the issuance or exercise of Exercise this Warrant, or any ad valorem property or intangible tax assessed against the Registered Holder. If this Warrant shall be exercised in part only, the Company shall, upon surrender of this Warrant for cancellation, execute and payment deliver a new Warrant evidencing the rights of the Registered Holder to purchase the balance of the Warrant Shares purchasable hereunder. (d) The Company shall have been received reasonably assist and cooperate with any Registered Holder required to make any governmental filings or obtain any governmental approvals prior to or in connection with any exercise of this Warrant (including, without limitation, making any filings required to be made by the Company). (e) Notwithstanding any other provision of this Warrant, if the exercise of all or any portion of this Warrant is to be made in connection with a registered public offering, a sale of the Company or any other transaction or event, such exercise may, at the election of the Registered Holder, be conditioned upon consummation of such transaction or event in which case such exercise shall not be deemed effective until the consummation of such transaction or event.

Exercise. (a) The Exercise Price per share Upon exercise of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice of Exercise”)this Warrant, which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per shareshall be payable in cash or by check, or at the Holder’s option, by crediting such Exercise Price to any Obligation (as such term is defined in the Loan Agreement) then owing to the Holder under the Loan Agreement or any of the Loan Documents described therein. If permitted by the Company, this Option This Warrant may be exercised in fractions by paying whole or in part so long as any exercise in part hereof would not involve the percentage issuance of fractional Warrant Shares or the payment of fractional cents, provided that this Warrant may not be exercised in part if the exercise is pursuant to the proviso of the Exercise Price per share represented by first paragraph of this Warrant. If exercised in part, the fractional purchase. (c) Payment Company shall deliver to the Holder a new Warrant, identical in form to this Warrant, in the name of the Exercise Price per share may Holder, evidencing the right to purchase the number of Warrant Shares as to which this Warrant has not been exercised, which new Warrant shall be made, at your election, with the approval signed by an appropriate officer of the Company. The term “Warrant” as used herein shall include any subsequent Warrant issued as provided herein. The Company hereby covenants and agrees that it shall not, at any time prior to the Expiration Date or (if sooner) the date on which this Warrant has been fully exercised, without the Holder’s prior written consent in each instance, amend or modify (or permit to be amended or modified) the Company’s Organic Documents (as such term is defined in the Loan Agreement) as in effect on the date of this Warrant in any manner which would, or would reasonably be expected to, (i) if constitute or give rise to a Default or Event of Default (as such terms are defined in the Shares are readily tradable on a national securities marketLoan Agreement), through a “cashless exercise” (ii) impair the rights of the Lender (as such term is defined in accordance with a Company-established policy the Loan Agreement) under the Loan Agreement or program for any of the sameother Loan Documents (as such term is defined in the Loan Agreement), or (iiiii) if impair any of the rights of the Holder under this Warrant (including, without limitation, any amendment which would require the affirmative vote, approval or consent of more than or other than a simple majority of the outstanding Common Shares are not readily tradable on a national securities market, by with respect to any method pre-approved by matter submitted or required to be submitted to the Company. (d) As soon as practicable but not later than five Business Days after stockholders of the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option shall be deemed to have been exercised and such Shares shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record of such Shares as of the date that such Notice of Exercise and payment shall have been received by the Companyapproval).

Exercise. (a) The This Warrant may be exercised by the Registered ▇▇▇▇▇▇▇▇ surrendering this Warrant, along with the purchase form appended hereto as Exhibit A duly executed and completed by the Registered Holder or by the Registered Holder’s duly authorized attorney, at the principal office of the Company, or at such other office or agency as the Company may designate by notice in writing to the Registered Holder, accompanied by cash or certified cashier’s check payable to the Company (or wire transfer of immediately available funds), in lawful money of the United States, of the Exercise Price per share payable in respect of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2number of Warrant Shares purchased upon such exercise (the “Aggregate Exercise Price”). (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in Section 1(a) above (the “Exercise Date”). At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in Section 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such Shares as of certificates. (c) Within ten (10) days after the date that of exercise of this Warrant, the Company, at its expense, will cause to be issued in the name of, and delivered to, the Registered Holder, or as such Notice Holder (upon payment by such Holder of Exercise any applicable transfer taxes) may direct, a certificate or certificates for the number of full Warrant Shares to which the Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which the Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 2 hereof. Notwithstanding the foregoing, the Registered Holder shall be solely responsible for any income taxes payable and payment arising from the issuance or exercise of this Warrant, or any ad valorem property or intangible tax assessed against the Registered Holder. (d) The Company shall have been received use its best efforts toassist and cooperate with the Registered Holder to make any governmental filings or obtain any governmental approvals prior to or in connection with any exercise of this Warrant (including, without limitation, making any filings required to be made by the Company). (e) Notwithstanding any other provision of this Warrant, if the exercise of all or any portion of this Warrant is to be made in connection with a registered public offering, a sale of the Company or any other transaction or event, such exercise may, at the election of the Registered Holder, be conditioned upon consummation of such transaction or event in which case such exercise shall not be deemed effective until the consummation of such transaction or event.

Exercise. This Option may be exercised during the term of the Option and to the extent set forth in Section 1.3., as follows: (a) The Exercise Price per share may be effected by surrender of this Option, with the form of subscription at the end hereof duly executed by Holder, to the Company at 42▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, accompanied by payment in cash 2 or by wire transfer to the Company, in the amount obtained by multiplying the number of Shares to be exercised (giving effect to any adjustment herein) by the Exercise Price, as adjusted. Such shares shall be issued as of the date of surrender of the Option and payment of the exercise price. In case such Shares have not been registered under the Securities Act of 1933, as amended (the "1933 Act"), the Company may also require that such Holder furnish to the Company a written statement that such Holder is $0.25. The Option may only purchasing such Shares for such Holder's own account for investment and not with a view toward distribution thereof, and that none of such Shares will be exercised if it becomes exercisable pursuant to Section 2.sold or otherwise distributed in violation of the provisions of the 1933 Act; and (b) The Option Exercise may be exercised effected by (i) providing written notice to exchange of the Company Option in the form prescribed by the stockholders whole or in part from time to time at any time and from time to time after (an "Option Exchange"), into the Option becomes exercisable number of Shares determined in accordance with this Section 2 (the “Notice of Exercise”b), which Notice of Exercise shall be delivered by surrendering this Option to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions accompanied by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received notice stating such Notice of Exercise and payment, the Company shall issue or cause Holder's intent to be issued, in accordance with effect such Notice of Exerciseexchange, the number of Shares specified in to be exchanged and the date on which the Holder requests that such Option Exchange occur (the "Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of ExerciseExchange"). The Option Exchange shall take place on the date specified in the Notice of Exchange or, if later, the date the Notice of Exchange is received by the Company (the "Exchange Date"). Certificates for the shares issuable upon such Option Exchange and, if applicable, a new Option of like tenor evidencing the balance of the shares remaining subject to this Option after deducting the number of Shares surrendered in such Option Exchange, shall be deemed issued as of the Exchange Date and delivered to the Holder within seven (7) business days following the Exchange Date. In connection with any Option Exchange, this Option shall represent the right to acquire the number of Shares (rounded to the next highest integer) equal to (i) the number of Shares surrendered (the "Total Number") specified by the Holder in its Notice of Exchange less (ii) the number of Shares equal to the quotient obtained by dividing (A) the product of the Total Number and the existing Exercise Price by (B) the current market value of a share of Common Stock. Current market value shall have been exercised and the meaning set forth Section 3.1(a)(iv) below, except that for purposes hereof, the date of exercise, as used in Section 3.1(a)(iv), shall mean the Exchange Date. In case such Shares shall be deemed have not been registered under the 1933 Act, the Company may also require that such Holder furnish to have been issuedthe Company a written statement that such Holder is purchasing such Shares for such Holder's own account for investment and not with a view toward distribution thereof, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record that none of such Shares as will be sold or otherwise distributed in violation of the date that such Notice provisions of Exercise and payment shall have been received by the Company1933 Act.

Exercise. (a) The Exercise Price per share of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Option Warrants may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders at any time or from time to time at any time and from time to time on or after the Option becomes exercisable Closing Date until April 30, 2011, on any day that is a Business Day, for all or any part of the number of Issuable Warrant Shares purchasable upon its exercise. In order to exercise any Warrants, in accordance with Section 2 (whole or in part, the “Notice of Exercise”), which Notice of Exercise shall be delivered Holder will deliver to the Company in at the form, and in the manner, address designated by the Company from time pursuant to time, and (ii) paying the Exercise Price per share. If permitted by the Company, Section 6.06 of this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the CompanyAgreement, (i) if a written notice of such Holder’s election to exercise its Warrant, which notice will specify the number and type of Issuable Warrant Shares are readily tradable on a national securities marketto be purchased pursuant to such exercise, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if payment of the Exercise Price, in an amount equal to the aggregate purchase price for all Issuable Warrant Shares are not readily tradable on a national securities marketto be purchased pursuant to such exercise, by any method pre-approved by and (iii) the Company. (d) As soon as practicable but not later than five Business Days after Warrants. Such notice will be substantially in the Company shall have received form of the Subscription Form appearing at the end of the Warrants. Upon receipt of such Notice of Exercise and paymentnotice, the Company shall issue will, as promptly as practicable, and in any event within five (5) Business Days, execute, or cause to be issuedexecuted, in accordance with and deliver to such Notice of Exercise, Holder a certificate or certificates representing the aggregate number of Shares full shares of Series D Convertible Preferred Stock and/or Common Stock, as the case may be, issuable upon such exercise, as provided in this Agreement. The stock certificate or certificates so delivered will be in such denominations as may be specified in such Notice notice and will be registered in the name of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of ExerciseHolder. The Option shall Warrants will be deemed to have been exercised and exercised, such Shares shall certificate or certificates will be deemed to have been issued, and you such Holder or any other family member(s) Person so designated or named in such Notice of Exercise shall notice will be deemed for all purposes to have become a holder of record of such Shares shares for all purposes, as of the close of business on the date that such Notice notice, together with payment of the Exercise Price and payment shall have been the Warrants, are received by the Company. If the Warrants have been exercised in part, the Company will, at the time of delivery of such certificate or certificates, deliver to such Holder new Warrants evidencing the rights of such Holder to purchase a number of Issuable Warrant Shares with respect to which the Warrants have not been exercised, which new Warrants will, in all other respects, be identical with the Warrants, or, at the request of such Holder, appropriate notation may be made on the Warrants and the Warrants returned to such Holder. (b) Payment of the Exercise Price will be made, at the option of the Holder, by (i) wire transfer or certified or official bank check, (ii) cancellation of any debt owed by the Company or any Subsidiary to the Holder, or (iii) cancellation of warrant, valued at Fair Market Value. If the Holder surrenders a combination of cash or cancellation of any debt owed by the Company to the Holder of Warrants, the Holder will specify the respective number of shares of Series D Convertible Preferred Stock and/or Common Stock to be purchased with each form of consideration, and the foregoing provisions will be applied to each form of consideration with the same effect as if the Warrants were being separately exercised with respect to each form of consideration; provided, however, that a Holder may designate that any cash to be remitted to a Holder in payment of debt be applied, together with other monies, to the exercise of the portion of the Warrants being exercised for cash.

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as Exhibit I duly executed by the Registered Holder or by the Registered Holder's duly authorized attorney, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant to Section 2designate, accompanied by payment in full, in lawful money of the United States, of the Purchase Price payable in respect of the number of Warrant Shares purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above accompanied by payment in full of the Purchase Price (the "Exercise Date"). At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such certificates. (c) As soon as practicable after the exercise of this Warrant in full or in part, and in any event within 5 business days thereafter, the Company, at its expense, will cause to be issued in the name of, and delivered to, the Registered Holder, or as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full Warrant Shares as to which the Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which the Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof; and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date hereof) of like tenor, calling in the aggregate on the face or faces thereof for the number of remaining Warrant Shares. (d) In the event that the Company's common stock has traded on the Nasdaq SmallCap Market, or comparable exchange, at a price of $2.00 per share or greater, as adjusted for any events described in Section 2 hereof, for ten consecutive trading days, the Company, at its sole discretion, may elect to demand call the exercise of this Warrant; provided however, that such Notice of Exercise call may not be made unless and payment shall until the Warrant Shares have previously been received registered for resale pursuant to a registration statement declared effective by the CompanySecurities and Exchange Commission.

Exercise. (a) The Exercise Price per share Subject to the provisions of Article V, each of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Option --------- Warrants may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time applicable Purchaser, or such Purchaser's successor Holders, at any time and or from time to time after the Option becomes exercisable in accordance with Section 2 Closing Date and prior to 12:00 p.m. midnight (Dallas, Texas time) on the “Notice tenth (10th) anniversary of Exercise”)the date of this Agreement; provided, which Notice however, that as a condition to the expiration of Exercise any Warrant -------- ------- exercise rights, the Company shall be delivered required to give each Holder not more than ninety (90) and not less than sixty (60) days' prior written notice of such expiration. Each of the Warrants may be exercised on any day that is a Business Day, for all or any part of the number of Issuable Warrant Shares purchasable upon its exercise. In order to exercise any Warrant, in whole or in part, the Holder will deliver to the Company in at the form, and in the manner, address designated by the Company from time pursuant to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the CompanySection 10.06, (i) if a written notice of such Holder's election to ------------- exercise its Warrant, which notice will specify the number of Issuable Warrant Shares are readily tradable on a national securities marketto be purchased pursuant to such exercise, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if payment of the Exercise Price, in an amount equal to the aggregate purchase price for all Issuable Warrant Shares are not readily tradable on a national securities marketto be purchased pursuant to such exercise, by any method pre-approved by and (iii) the Company. (d) As soon as practicable but not later than five Business Days after Warrant. Such notice will be substantially in the Company shall have received form of the Subscription Form appearing at the end of the Warrants. Upon the receipt of such Notice of Exercise and paymentnotice, the Company shall issue will, as promptly as practicable, and in any event within three (3) Business Days, execute, or cause to be issuedexecuted, in accordance with and deliver to such Notice of Exercise, Holder a certificate or certificates representing the aggregate number of Shares full shares of Common Stock and Other Securities issuable upon such exercise, as provided in this Agreement. The certificate or certificates so delivered will be in such denominations as may be specified in such Notice notice or by such Holder and will be registered in the name of Exercisesuch Holder, issued in your name or in such other name or names of any immediate family member as designated in such Notice of Exercisenotice or by such Holder. The Option shall A Warrant will be deemed to have been exercised and exercised, such Shares shall certificate or certificates will be deemed to have been issued, and you such Holder or any other family member(s) Person so designated or named in such Notice of Exercise shall notice will be deemed for all purposes to have become a holder of record of such Shares shares for all purposes, as of the date that such Notice payment of the Exercise Price and payment shall have been the applicable Warrant are received by the Company. If the Warrant has been exercised in part, then the Company will, at the time of delivery of such certificate or certificates, deliver to such Holder a new Warrant evidencing the rights of such Holder to purchase a number of Issuable Warrant Shares with respect to which the Warrant has not been exercised, which new Warrant will, in all other respects, be identical with the Warrants, or, with the consent of such Holder, appropriate notation may be made on the Warrant and the Warrant returned to such Holder. (b) Payment of the Exercise Price will be made, at the option of the Holder, (i) in cash, (ii) by certified or official bank check, (iii) by cancellation of any debt owed by the Company to the Holder or (iv) by cancellation of Warrant Shares, valued at Fair Market Value. If the Holder surrenders a combination of cash or cancellation of any debt owed by the Company to the Holder or Warrant Shares, then the Holder will specify the respective number of shares of Common Stock to be purchased with each form of consideration, and the foregoing provisions will be applied to each form of consideration with the same effect as if the Warrant were being separately exercised with respect to each form of consideration; provided, however, that a Holder may designate -------- ------- that any cash to be remitted to a Holder in payment of debt be applied, together with other monies, to the exercise of the portion of the Warrant being exercised for cash.

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as Exhibit A duly executed by such Registered Holder, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant designate, accompanied by payment in full, by bank or certified check in lawful money of the United States, of the Purchase Price payable in respect of the number of shares of Warrant Stock purchased upon such exercise, or in lieu of such cash payment, the Registered Holder may elect to Section 2reduce the amount of indebtedness owed by the Company to the Registered Holder by the amount of such Purchase Price. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above. At such Shares time, the person or persons in whose name or names any certificates for Warrant Stock shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Stock represented by such Shares certificates. (c) As soon as practicable after the exercise of this Warrant in full or in part, and in any event within ten (10) days thereafter, the Company at its expense will cause to be issued in the name of, and delivered to, the Registered Holder, or, subject to the terms and conditions hereof, as the Registered Holder (upon payment by the Registered Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full shares of Warrant Stock to which such Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which such Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof, and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, calling in the aggregate on the face or faces thereof for the number of shares of Warrant Stock equal (without giving effect to any adjustment therein) to the number of such Notice shares called for on the face of Exercise and payment shall have been received this Warrant minus the number of such shares purchased by the CompanyRegistered Holder upon such exercise as provided in subsection 1(a) above.

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, with the form of election to purchase appended hereto as Exhibit I duly completed and executed by such Registered Holder, at the principal office of the Option Company, or at such other office or agency as the Company may designate, accompanied by payment in full of the Purchase Price payable in respect of the number of shares of Warrant Stock purchased upon such exercise in cash or by certified or official bank check payable to the order of the Company. Any exercise of this Warrant may be made subject to the satisfaction of one or more conditions (including, without limitation, the consummation of a sale of the capital stock of the Company or a merger or other business combination involving the Company) which are set forth in a writing which is $0.25. The Option made a part of or is appended to the aforementioned form of election to purchase notice (as the case may only be exercised if it becomes exercisable pursuant to Section 2be) by the Registered Holder. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above. At such Shares time, the person or persons in whose name or names any certificates for Warrant Stock shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Stock represented by such Shares certificates. (c) As soon as practicable after the exercise of this Warrant in full or in part, and in any event within 10 days thereafter, the Company at its expense will cause to be issued in the name of, and delivered to, the Registered Holder, or, subject to the terms and conditions hereof, as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full shares of Warrant Stock to which such Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which such Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof, and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, calling in the aggregate on the face or faces thereof for the number of shares of Warrant Stock equal (without giving effect to any adjustment therein) to the number of such Notice shares called for on the face of Exercise and payment shall have been received this Warrant minus the number of such shares purchased by the CompanyRegistered Holder upon such exercise as provided in subsection 1(a) above.

Exercise. (ai) The Exercise Price per share of Subject to the other terms and conditions hereof, -------- the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant exercisable, provided payment is made as provided below, from time to Section 2. (b) The Option may be exercised time by (i) providing written notice to the Company (in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted required by the Company, the covenants and substantive provisions of which are hereby made part of this Agreement), which shall: (a) state that the Option may is thereby being exercised, the number of Shares with respect to which the Option is being exercised, each person in whose name any certificates for the Shares should be registered and that person's address and social security number; (b) be signed by the person or persons entitled to exercise the Option and, if the Option is being exercised in fractions by paying anyone other than the percentage Holder, be accompanied by proof satisfactory to counsel for the Company of the Exercise Price per share represented by right of that person or persons to exercise the fractional purchase.Option under all applicable laws and regulations; and (c) Payment be accompanied by such representations, warranties or agreements with respect to the investment intent of the Exercise Price per share person or persons exercising the Option as the Company may be madereasonably request, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program form and substance satisfactory to counsel for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (dii) Payment of the Option price may be made, in the discretion of the person exercising the Option, by full payment of the option price in cash or by check, or, with the consent of the Company, in whole or in part by a surrender of previously acquired Common Shares of the Company having a Fair Market Value (as defined below) on the date of exercise equal to that portion of the purchase price for which payment in cash or check is not made. The latter of the dates on which that notice and payment are received by the Company constitutes the date of exercise of the Option; and (iii) For purposes hereof, the "Fair Market Value" of a Common Share as of any date shall be; (a) the closing price of a Common Share on the principal exchange on which the Common Shares are then trading, if any, on the day immediately prior to that date, or if Common Shares were not traded on that prior day, then on the next preceding trading day during which a sale occurred (the applicable trading day, the "Trade Date"); or (b) if Common Shares are not traded on an exchange but are quoted on NASDAQ or a successor quotation system, (1) the last sale price (if Common Shares are then listed as a National Market Issue under the NASD National Market System) on the Trade Date; or (2) if Common Shares are not then so listed, the mean between the closing representative bid and asked prices for Common Shares on the Trade Date as reported by NASDAQ or that successor quotation system; or (3) if Common Shares are not publicly traded on an exchange and not quoted on NASDAQ or a successor quotation system, the mean between the closing bid and asked prices for Common Shares, on the Trade Date, as determined in good faith by the Board of Directors; or (4) if Common Shares are not publicly traded, the fair market value established by the Board of Directors of the Company acting in good faith. (iv) As soon as practicable but not later than five Business Days after a condition to the exercise of the Option and the obligation of the Company to issue Shares upon the exercise thereof, the proposed recipient of the Shares shall have received such Notice make any representation or warranty necessary to comply with any applicable law or regulation or to confirm any factual matter reasonably requested by the Company or its counsel. (v) Upon exercise of Exercise the Option and paymentthe satisfaction of all conditions thereto, the Company shall issue deliver a certificate or cause certificates for the applicable Shares to be issued, in accordance with such Notice the person or persons and at the time specified above upon receipt of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option shall be deemed to have been exercised and such Shares shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed payment for all purposes to have become a holder of record of such those Shares as of the date that such Notice of Exercise and payment shall have been received by the Companyset forth above.

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as Exhibit I duly executed by the Registered Holder or by the Registered Holder's duly authorized attorney, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant to Section 2designate, accompanied by payment in full, in lawful money of the United States, of the Purchase Price payable in respect of the number of Warrant Shares purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase.[intentionally omitted] (c) Payment Each exercise of this Warrant shall be deemed to have been effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above accompanied by payment in full of the Purchase Price (the "Exercise Price per share may Date"). At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be made, at your election, with issuable upon such exercise as provided in subsection 1(d) below shall be deemed to have become the approval holder or holders of record of the Company, (i) if the Warrant Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, represented by any method pre-approved by the Companysuch certificates. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice exercise of Exercise this Warrant in full or in part, and paymentin any event within 5 business days thereafter, the Company shall issue or Company, at its expense, will cause to be issuedissued in the name of, in accordance with and delivered to, the Registered Holder, or as such Notice Holder (upon payment by such Holder of Exercise, any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full Warrant Shares specified to which the Registered Holder shall be entitled upon such exercise plus, in such Notice of Exercise, issued in your name or in such other name or names lieu of any immediate family member designated fractional share to which the Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof; and (ii) in case such Notice of Exercise. The Option shall be deemed to have been exercised and such Shares shall be deemed to have been issuedexercise is in part only, and you a new warrant or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record of such Shares as of warrants (dated the date that such Notice hereof) of Exercise and payment shall have been received by like tenor, calling in the Companyaggregate on the face or faces thereof for the number of remaining Warrant Shares.

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Registered Holder on not more than one occasion, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as APPENDIX I duly executed by such Registered Holder or by such Registered ▇▇▇▇▇▇'s duly authorized attorney, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant to Section 2designate, accompanied by payment in full, in lawful money of the United States, of the Purchase Price payable in respect of the number of Warrant Shares purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection l(a) above. At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection l(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such certificates. (c) As soon as practicable after the exercise of this Warrant in full or in part, and in any event within 10 days thereafter, the Company, at its expense, will cause to be issued in the name of, and delivered to, the Registered Holder, or as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full Warrant Shares as to which such Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which such Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof; and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, calling in the aggregate on the face or faces thereof for the number of Warrant Shares equal (without giving effect to any adjustment therein) to the number of such Notice shares called for on the face of Exercise and payment shall have been received this Warrant minus the number of such shares purchased by the CompanyRegistered Holder upon such exercise.

Exercise. Prior to the exercise of all or any part of this Warrant, -------- Holder shall give thirty (a30) The Exercise Price per share days prior written notice ("Holder Notice") of his intent to exercise to the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Option may be exercised by (i) providing Company at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, or such other address as the Company shall designate in a written notice to the Holder. Within five (5) days after receipt of such notice, the Company in the form prescribed shall deliver to Holder: any Prospectus used by the stockholders Company during the year in which the Holder Notice is received, together with all supplemental information required to insure that such Prospectus does not omit to state or misstate a material fact; its Annual Report on Form 10-K, if any, for the Company's most recently completed fiscal year; all Quarterly Reports of Form 10- Q, if any, filed by the Company during its current fiscal year; and all Current Reports on Form 8-K, if any, filed by the Company during its current fiscal year. Holder shall have until the thirtieth (30th) day from time the date of the Holder Notice to time at any time and from time rescind such notice. If Holder does not elect to time rescind the Holder Notice, then on or within five (5) days after the Option becomes exercisable in accordance with Section 2 such thirtieth (the “Notice of Exercise”)30th) day, which Notice of Exercise Holder shall be delivered deliver to the Company (the "Exercise Delivery"): (i) this Warrant; (ii) a signed statement indicating the number of shares to be purchased; and (iii) a certified check in the formamount of the Exercise Price. Upon receipt of the Exercise Delivery, the Company shall as promptly as practicable, and in any event within fifteen (15) days thereafter, execute and deliver, or cause to be executed and delivered to Holder a certificate for the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per sharenumber of whole Shares for which this Warrant is being exercised. If permitted by the Company, this Option may be Warrant is exercised in fractions by paying the percentage with respect to less than all of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and paymentShares, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, a new warrant for the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option shall be deemed to have been exercised and such Shares shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record of such Shares as of the date that such Notice of Exercise and payment shall have been received remaining shares covered by the Companythis Warrant.

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as Exhibit I duly executed by such Registered Holder, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant to Section 2designate, accompanied by payment in full, by bank or certified check in lawful money of the United States, of the Purchase Price payable in respect of the number of shares of Warrant Stock purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above. At such Shares time, the person or persons in whose name or names any certificates for Warrant Stock shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Stock represented by such Shares certificates. (c) As soon as practicable after the exercise of this Warrant in full or in part, and in any event within ten (10) days thereafter, the Company at its expense will cause to be issued in the name of, and delivered to, the Registered Holder, or, subject to the terms and conditions hereof, as the Registered Holder (upon payment by the Registered Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full shares of Warrant Stock to which such Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional shares to which such Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof, and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, calling in the aggregate on the face or faces thereof for the number of shares of Warrant Stock equal (without giving effect to any adjustment therein) to the number of such Notice shares called for on the face of Exercise and payment shall have been received this Warrant minus the number of such shares purchased by the CompanyRegistered Holder upon such exercise as provided in subsection 1(a) above.

Exercise. (a) The Exercise Price per share If at any time after the Closing Date and prior to the expiration of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant Resale Registration Period, the Company proposes to Section 2. register any Common Stock under the 1933 Act (b) The Option may be exercised by other than (i) providing a registration relating solely to the sale of securities to participants in a Company stock plan, (ii) a registration relating solely to a transaction described in Rule 145 under the 1933 Act, (iii) a registration on any form that may not be used for the Registrable Securities, (iv) a registration in which the only Common Stock being registered is Common Stock issuable upon conversion of debt securities which are also being registered or (v) a registration on the Resale Registration Statement), whether for its own account or for the account of any holder of securities, the Company shall promptly, but not later than 30 days prior to the initial filing of such registration statement, give each Holder written notice of such registration setting forth the intended method of disposition, the maximum proposed offering price, commissions and discounts in connection therewith and other relevant information. Upon the written request of any Holder given within 10 Business Days after the giving of such notice by the Company, the Company shall, subject to the Company provisions of this section, cause to be registered under the 1933 Act all of the Registrable Securities which such Holders request to be registered by inclusion of such Registrable Securities in the form prescribed by registration statement which covers the stockholders from time securities which the Company proposes to time register; provided, that if, at any time after giving written notice pursuant to this Section 2.3(a) of its intention to register any Common Stock and from time prior to time after the Option becomes exercisable effective date of the registration statement filed in accordance with Section 2 connection therewith, the Company shall determine for any reason either not to register or to delay registration of such securities, the Company may, at its election, give written notice of such determination to each Holder and, thereupon, (i) in the “Notice case of Exercise”)a determination not to register, which Notice of Exercise shall be delivered relieved of its obligation to register any Registrable Securities in connection with such registration (but not from its obligation to pay the Company Registration Expenses in the form, and in the manner, designated by the Company from time to timeconnection therewith), and (ii) paying in the Exercise Price per share. If case of a determination to delay registering, shall be permitted by the Companyto delay registering any Registrable Securities, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if same period as the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, delay in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in registering such other name or names of any immediate family member designated in such Notice of Exercise. The Option shall be deemed to have been exercised and such Shares shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record of such Shares as of the date that such Notice of Exercise and payment shall have been received by the Companysecurities.

Exercise. (a) The Exercise Price per share of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Option This Warrant may be exercised by (i) providing written notice as to all or any of the Company in the form prescribed by the stockholders Shares as to which this Warrant has vested and become fully exercisable at any time or from time to time at any time and from time to time on or after the Option becomes exercisable date on which such vesting of the Warrant occurs as to such Shares, on any Business Day (as defined in accordance with Section 2 (9 below). In order to exercise this Warrant, in whole or in part, the “Notice of Exercise”), which Notice of Exercise shall be delivered holder will deliver to the Company at its principal offices (i) a written notice of such holder's election to exercise its Warrant, substantially in the formform of the Warrant Exercise Notice attached to this Warrant, (ii) payment of the Exercise Price, in an amount equal to the aggregate purchase price for all Shares to be purchased pursuant to such exercise, and (iii) the Warrant. Upon receipt of such notice, the Company will, as promptly as practicable, and in the mannerany event within ten (10) Business Days, designated by the Company from time to timeexecute, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issuedexecuted, in accordance with and deliver to such Notice of Exercise, holder a certificate or certificates representing the aggregate number of Shares full shares of Common Stock issuable upon such exercise. The stock certificate or certificates so delivered will be in such denominations as may be specified in such Notice notice and will be registered in the name of Exercisesuch holder, issued in your name or in such other name or names of any immediate family member as designated in such Notice of Exercisenotice. The Option shall A Warrant will be deemed to have been exercised and exercised, such Shares shall certificate or certificates will be deemed to have been issued, and you such holder or any other family member(s) person or entity so designated or named in such Notice of Exercise shall notice will be deemed for all purposes to have become a holder of record of such Shares shares for all purposes, as of the date that such Notice notice (together with payment of the Exercise Price and payment shall have been the Warrant) is received by the Company. If the Warrant has been exercised in part, the Company will, at the time of delivery of such certificate of certificates, either deliver to such holder a new Warrant evidencing the rights of such holder to purchase a number of Shares with respect to which the Warrant has not been exercised, which new Warrant will, in all other respects, be identical to this Warrant, or, at the request of such holder, appropriate notation may be made on the Warrant and the Warrant returned to such holder. (b) Payment of the Exercise Price will be made, at the option of the holder, by (i) company or individual check (subject to collection), certified or official bank check or (ii) cancellation of any debt owed by the Company to the holder. If the holder surrenders a combination of cash or cancellation of any debt owed by the Company to the holder, the holder will specify the respective number of shares of Common Stock to be purchased with each form of consideration, and the foregoing provisions will be applied to each form of consideration with the same effect as if the Warrant were being separately exercised with respect to each form of consideration; PROVIDED, HOWEVER, that a holder may designate that any cash to be remitted to a holder in payment of debt be applied, together with other monies, to the exercise of the portion of the Warrant being exercised for cash. (c) In lieu of exercising this Warrant in the manner set forth in paragraph 3(b) above, this Warrant may be exercised by surrender of the Warrant without payment of any other consideration, commission or remuneration, together with the cashless exercise subscription form at the end hereof, duly executed. The number of shares to be issued in exchange for the Warrant shall be the product of (x) the excess of the Market Price (as defined below) of the Common Stock on the date of surrender of the Warrant and the exercise subscription form OVER the Exercise Price per share and (y) the number of shares subject to issuance upon exercise of the Warrant, divided by the Market Price of the Common Stock on such date. Upon such exercise and surrender of this Warrant, the Company will (i) issue a certificate or certificates in the name of the holder for the largest number of whole shares of the Common Stock to which the holder shall be entitled and, in lieu of any fractional share of the Common Stock to which the Holder shall be entitled, pay cash equal to the fair value of such fractional share (determined in such reasonable manner as the Board of Directors of the Company shall determine), and (ii) deliver the other securities and properties receivable upon the exercise of this Warrant, pursuant to the provisions of this Warrant. (d) The market price of a share of the Common Stock (the "Market Price") on any date of determination shall be (i) the average of the last reported sale price of the Common Stock on the five business days immediately preceding the date of determination as reported on the Nasdaq Market ("NASDAQ") or (ii) if there is no such reported sale on any of the dates in question, the average of the closing bid and asked quotations as so reported on NASDAQ for such dates.

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as Exhibit I duly executed by the Registered Holder or by the Registered Holder's duly authorized attorney, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant to Section 2designate, accompanied by payment in full, in lawful money of the United States, of the Purchase Price payable in respect of the number of Units purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above accompanied by payment in full of the Purchase Price (the "Exercise Date"). At such time, the person or persons in whose name or names any certificates for Warrant Shares or Underlying Warrants shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares or Underlying Warrants represented by such certificates. (c) As soon as practicable after the exercise of this Warrant in full or in part, and in any event within 5 business days thereafter, the Company, at its expense, will cause to be issued in the name of, and delivered to, the Registered Holder, or as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full Warrant Shares as and Underlying Warrants to which the Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which the Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof; and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that such Notice hereof) of Exercise and payment shall have been received by like tenor, calling in the Companyaggregate on the face or faces thereof for the number of remaining Units.

Exercise. (a) The Exercise Price per share Option shall become exercisable with respect to ___ shares of Common Stock on __________ and with respect to an additional ___ shares of Common Stock on the first day of each calendar month thereafter until the Option is $0.25exercisable for all ____ shares of Common Stock. The If Option may Holder ceases to be an employee of RNET, then the Option shall be exercisable for only the number of shares of Common Stock as to which it was exercisable on the date on which Option Holder ceases to be exercised if it becomes exercisable pursuant to Section 2an employee of RNET. (b) The Option may be exercised by delivery to RNET of written notice specifying the number of shares with respect to which the Option is exercised and the Option Price for such number of shares. The notice shall contain Option Holder's representation that he is purchasing such the shares for investment purposes only and his agreement not to sell any shares so purchased in violation of the Securities Act of 1933 or other applicable law. Such restrictions or notice thereof shall be placed on the certificates representing the shares so purchased, and RNET may refuse to issue the certificates or to transfer the shares on its books unless it is satisfied that no violation of such restrictions will occur. The Option Price shall be paid (i) providing written notice in cash, (ii) by certified or cashier's check payable to the Company order of RNET, or (iii) by delivery of certificates representing a number of shares of Common Stock, the fair market value of which (as determined in the form prescribed by sole discretion of the stockholders from time to time board of directors of RNET) at any time and from time to time after least equals the Option becomes exercisable Price of the shares purchased pursuant to the Option. No shares of Common Stock acquired through the exercise of an incentive stock option or an option granted under an employee stock purchase plan may be used to purchase shares pursuant to the Option until the holding period applicable to such shares has expired. Furthermore, in accordance with Section 2 (no case may shares of Common Stock be used to purchase shares pursuant to the “Notice of Exercise”)Option until the shares have been held for at least six months. Upon issuance, which Notice of Exercise a certificate or certificates representing the shares so purchased shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchaseHolder. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option shall be deemed to have been exercised and such Shares shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record of such Shares as of the date that such Notice of Exercise and payment shall have been received by the Company.

Exercise. (a) The This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as Exhibit I duly executed by such Registered Holder, at the principal office of the Company, or at such other office or agency as the Company may designate, accompanied by payment in full, in lawful money of the United States, of the Exercise Price per share payable in respect of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2number of shares of Warrant Stock being purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which the Warrant shall have been surrendered to the Company as provided in subsection 1(a) above. At such Shares time, the person or persons in whose name or names any certificates for Warrant Stock shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issuedbecome the holder or holders of record of the Warrant Stock represented by such certificates. (c) As soon as practicable after the exercise of this Warrant in full or in part the Company at its expense will cause to be issued in the name of, and you delivered to, the Registered Holder, or, subject to the terms and conditions hereof, as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct: (i) a certificate or other family member(scertificates for the number of full shares of Warrant Stock to which such Registered Holder shall be entitled upon such exercise, and (ii) designated in case such Notice exercise is in part only, a new warrant or warrants (dated the date hereof) of like tenor, calling in the aggregate on the face or faces thereof for the number of shares of Warrant Stock equal (without giving effect to any adjustment therein) to the number of such shares called for on the face of this Warrant, minus the number of such shares purchased by the Registered Holder upon such exercise as provided in subsection 1(a) above. (d) In lieu of the payment of the Exercise Price in the manner required by Section 1(a), the Holder shall have the right (but not the obligation) to pay the Exercise Price for the shares of Common Stock being purchased with this Warrant upon exercise by the surrender to the Company of any exercisable but unexercised portion of this Warrant having a "Value" (as defined below), at the close of trading on the last trading day immediately preceding the exercise of this Warrant, equal to the Exercise Price multiplied by the number of shares of Common Stock being purchased upon exercise ("Cashless Exercise Right"). The sum of (x) the number of shares of Common Stock being purchased upon exercise of the non-surrendered portion of this Warrant pursuant to this Cashless Exercise Right and (y) the number of shares of Common Stock underlying the portion of this Warrant being surrendered, shall not in any event be greater than the total number of shares of Common Stock purchasable upon the complete exercise of this Warrant if the Exercise Price were paid in cash. The "Value" of the portion of the Warrant being surrendered shall equal the remainder derived from subtracting (x) the Exercise Price multiplied by the number of shares of Common Stock underlying the portion of this Warrant being surrendered from (y) the Market Price of a share of Common Stock multiplied by the number of shares of Common Stock underlying the portion of this Warrant being surrendered. As used in this Warrant, the term "Market Price" at any date shall be deemed for all purposes to have become a holder of record of such Shares as be the last reported sale price of the date that Common Stock on such Notice date, or, in case no such reported sale takes place on such day, the average of Exercise and payment shall have been received the last reported sale price for the immediately preceding three trading days, in either case as officially reported by the national securities exchange on which the Common Stock is trading, or, if the Common Stock is not principally traded on any national securities exchange, the last reported sale price as furnished by the NASD through the Nasdaq National Market or SmallCap Market, or, if applicable, the OTC Bulletin Board, or if the Common Stock is not listed or admitted to trading on the Nasdaq National Market or SmallCap Market or OTC Bulletin Board or similar organization, as determined in good faith by resolution of the Board of Directors of the Company, based on the best information available to it. The Cashless Exercise Right may be exercised by the Holder on any business day on or after the Commencement Date and not later than the Expiration Date by delivering the Warrant with a duly executed exercise form attached hereto with the cashless exercise section completed to the Company, exercising the Cashless Exercise Right and specifying the total number of shares of Common Stock being purchased pursuant to such Cashless Exercise Right.

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as Exhibit I duly executed by such Registered Holder, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant to Section 2designate, accompanied by payment in full, in lawful money of the United States, of the Purchase Price payable in respect of the number of shares of Warrant Stock purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above. At such Shares time, the person or persons in whose name or names any certificates for Warrant Stock shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Stock represented by such Shares certificates. (c) As soon as practicable after the exercise of this Warrant in full or in part, and in any event within 10 days thereafter, the Company at its expense will cause to be issued in the name of, and delivered to, the Registered Holder, or, subject to the terms and conditions hereof, as such Registered Holder (upon payment by such Registered Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full shares of Warrant Stock to which such Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which such Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof, and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, calling in the aggregate on the face or faces thereof for the number of shares of Warrant Stock equal (without giving effect to any adjustment therein) to the number of such Notice shares called for on the face of Exercise and payment shall have been received this Warrant minus the number of such shares purchased by the CompanyRegistered Holder upon such exercise as provided in subsection 1(a) above.

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as Exhibit I duly executed by the Registered Holder or by the Registered Holder’s duly authorized attorney, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may designate, accompanied by payment in full, in lawful money of the United States, of the Purchase Price payable in respect of the number of Warrant Shares purchased upon such exercise; provided however that this Warrant may only be exercised if it becomes as to vested Warrant Shares, and shall vest and become exercisable pursuant as follows: in twelve (12) consecutive equal monthly amounts at the end of each calendar month starting April 30, 2013 such that all Warrant Shares are vested in full on March 31, 2014 (the “Fully Vested Date”), unless the Agreement dated April 13, 2010 by and among Prof. Avi Israeli, the Registered Holder and the Company (the “Agreement”) is terminated prior to Section 2the Fully Vested Date, in which case no further Warrant Shares shall vest on or after the date of such termination. Upon termination of the Agreement vesting shall cease and the Registered Holder shall be entitled to exercise this Warrant only with respect to the portion of the Warrant Shares that shall have vested prior to the date of termination of the Agreement, rounded to the nearest number without decimal. The Warrant shall be valid until and may be exercised only on or before the earliest of the following: (i) immediately prior to a sale of all or substantially all of the shares of the Company in a merger and/or acquisition transaction; (ii) the Expiration Date; or (iii) six (6) months following the termination of the Agreement. Immediately after such date all unexercised Warrant Shares shall expire and be forfeited, and this Warrant shall terminate. (b) The Option may be exercised Registered Holder may, at its option, elect to pay some or all of the Purchase Price payable upon an exercise of this Warrant by canceling a portion of this Warrant exercisable for such number of Warrant Shares as is determined by dividing (i) providing written notice to the Company total Purchase Price payable in respect of the form prescribed number of Warrant Shares being purchased upon such exercise by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the excess of the Fair Market Value per share of Common Stock (as defined below) as of the Exercise Date (as defined in subsection 1(c) below) over the Purchase Price per share. If permitted the Registered Holder wishes to exercise this Warrant pursuant to this method of payment with respect to the maximum number of Warrant Shares purchasable pursuant to this method, then the number of Warrant Shares so purchasable shall be equal to the total number of Warrant Shares, minus the product obtained by multiplying (x) the Companytotal number of Warrant Shares by (y) a fraction, this Option may the numerator of which shall be exercised in fractions by paying the percentage Purchase Price per share and the denominator of which shall be the Fair Market Value per share of Common Stock as of the Exercise Price Date. The Fair Market Value per share represented of Common Stock shall be determined as follows: (i) If the Common Stock is listed on a national securities exchange or another nationally recognized trading system as of the Exercise Date, the Fair Market Value per share of Common Stock shall be deemed to be the average of the high and low reported sale prices per share of Common Stock thereon on the trading day immediately preceding the Exercise Date (provided that if no such price is reported on such day, the Fair Market Value per share of Common Stock shall be determined pursuant to clause (ii)). (ii) If the Common Stock is not listed on a national securities exchange or another nationally recognized trading system as of the Exercise Date, the Fair Market Value per share of Common Stock shall be deemed to be the amount most recently determined by the fractional purchaseBoard of Directors to represent the fair market value per share of the Common Stock (including without limitation a determination for purposes of granting Common Stock options or issuing Common Stock under an employee benefit plan of the Company); and, upon request of the Registered Holder, the Board of Directors (or a representative thereof) shall promptly notify the Registered Holder of the Fair Market Value per share of Common Stock. Notwithstanding the foregoing, if the Board of Directors has not made such a determination within the three-month period prior to the Exercise Date, then (A) the Board of Directors shall make a determination of the Fair Market Value per share of the Common Stock within 15 days of a request by the Registered Holder that it do so, and (B) the exercise of this Warrant pursuant to this subsection 1(b) shall be delayed until such determination is made. (c) Payment Each exercise of this Warrant shall be deemed to have been effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above (the “Exercise Date”). At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1(d) below shall be deemed to have become the holder or holders of record of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Warrant Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, represented by any method pre-approved by the Companysuch certificates. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice exercise of Exercise this Warrant in full or in part, and paymentin any event within 10 days thereafter, the Company shall issue or Company, at its expense, will cause to be issuedissued in the name of, in accordance with and delivered to, the Registered Holder, or as such Notice Holder (upon payment by such Holder of Exercise, any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full Warrant Shares specified to which the Registered Holder shall be entitled upon such exercise plus, in such Notice of Exercise, issued in your name or in such other name or names lieu of any immediate family member designated fractional share to which the Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof; and (ii) in case such Notice exercise is in part only, a new warrant or warrants (dated the date hereof) of Exercise. The Option shall be deemed like tenor, calling in the aggregate on the face or faces thereof for the number of Warrant Shares equal (without giving effect to have been exercised and such Shares shall be deemed any adjustment therein) to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record the number of such shares called for on the face of this Warrant minus the sum of (a) the number of such shares purchased by the Registered Holder upon such exercise plus (b) the number of Warrant Shares as (if any) covered by the portion of this Warrant cancelled in payment of the date that Purchase Price payable upon such Notice of Exercise and payment shall have been received by the Companyexercise pursuant to subsection 1(b) above.

Exercise. (a) The Exercise Price per share of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Option This Warrant may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time whole or in part at any time and or from time to time after the Option becomes exercisable in accordance with Section 2 Closing Date of the Agreement and on or before the fifth anniversary of the Closing Date of the Agreement (the “Notice of Exercise”"Expiration Date"), which Notice unless otherwise extended pursuant to the terms of Exercise the Agreement. In order to exercise this Warrant, in whole or in part, the Holder shall be delivered deliver to the Company in the format its principal office at ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, and in the manner▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, or at such other office as shall be designated by the Company from time pursuant to timethe Agreement: (a) written notice of the Holder's election to exercise this Warrant, which notice shall be substantially in the form of the attached "Subscription Form" and shall specify the number of shares of Common Stock to be purchased pursuant to such exercise; (b) either (i) a wire transfer of immediately available funds to the Company or (ii) paying notice that the Exercise Price per share. If permitted is satisfied by reduction of the number of shares to be received by the CompanyHolder upon exercise of this Warrant as provided in Section 4 below, this Option may with the amount of such reduction specified in such notice; in each case such wire transfer or reduction in the number of shares shall be exercised in fractions by paying an amount equal to the percentage aggregate purchase price for all shares of the Exercise Price per share represented by the fractional purchase.Common Stock to be purchased pursuant to such exercise; and (c) Payment of the Exercise Price per share may be madethis Warrant, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and paymentproperly endorsed. Upon receipt thereof, the Company shall issue shall, as promptly as practicable, and in any event within ten (10) days thereafter, execute (or cause to be issued, in accordance with such Notice of Exercise, executed) and deliver to the Holder a certificate or certificates representing the aggregate number of Shares specified full shares of Common Stock issuable upon such exercise. The stock certificate or certificates so delivered shall be registered in such Notice the name of Exercisethe Holder, issued in your name or in such other name or names of any immediate family member as shall be designated in such Notice of Exercisesaid notice. The Option This Warrant shall be deemed to have been exercised and such Shares certificate or certificates shall be deemed to have been issued, and you the Holder or any other family member(s) person so designated in such Notice of Exercise to be named therein shall be deemed for all purposes to have become a holder Holder of record of such Shares shares for all purposes, as of the date that such Notice of Exercise said notice, together with said payment and payment shall have been this Warrant, is received by the Company as aforesaid (the "Exercise Date"). Except as otherwise provided in the Agreement, the Holder of this Warrant shall not, by virtue of its ownership of this Warrant, be entitled to any rights of a stockholder in the Company, either at law or in equity; provided, however, that the Holder shall, for all purposes, be deemed to have become the Holder of record of such shares on the Exercise Date. If the exercise is for less than all of the shares of Common Stock issuable as provided in this Warrant, the Company shall issue a new Warrant of like tenor and date for the balance of such shares issuable hereunder to the Holder. The Holder of this Warrant, by its acceptance hereof, consents to and agrees to be bound by and to comply with all of the provisions of this Warrant.

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as Exhibit I duly executed by such Registered Holder, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant to Section 2designate, accompanied by payment in full, in lawful money of the United States, of the Purchase Price payable in respect of the number of full shares of Warrant Stock purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above. At such Shares time, the person or persons in whose name or names any certificates for Warrant Stock shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Stock represented by such Shares certificates. (c) As soon as practicable after the exercise of this Warrant in full or in part, and in any event within 10 days thereafter, the Company at its expense will cause to be issued in the name of, and delivered to, the Registered Holder, or, subject to the terms and conditions hereof, as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full shares of Warrant Stock to which such Registered Holder shall be entitled upon such exercise, and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, calling in the aggregate on the face or faces thereof for the number of shares of Warrant Stock equal (without giving effect to any adjustment therein) to the number of such Notice shares called for on the face of Exercise and payment shall have been received this Warrant minus the number of such shares purchased by the CompanyRegistered Holder upon such exercise as provided in subsection 1(a) above.

Exercise. (a) The Exercise Price per share Warrants may be exercised by a Registered Holder, in whole or in part, by surrendering a Warrant Certificate, with the form of election to purchase appended hereto as Exhibit I duly completed and executed by --------- such Registered Holder, at the principal office of the Option Company, or at such other office or agency as the Company may designate, accompanied by payment in full of the Purchase Price payable in respect of the number of shares of Warrant Stock purchased upon such exercise in lawful money of the United States of America. Any exercise of the Warrants may be made subject to the satisfaction of one or more conditions (including, without limitation, the consummation of a sale of the capital stock of the Company or a merger or other business combination involving the Company) which are set forth in a writing which is $0.25. The Option may only be exercised if it becomes exercisable pursuant made a part of or is appended to Section 2the aforementioned form of election to purchase notice by the Registered Holder. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage Each exercise of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrants shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which a Warrant Certificate shall have been surrendered to the Company as provided in subsection 3(a) above. At such Shares time, the person or persons in whose name or names any certificates for Warrant Stock shall be issuable upon such exercise as provided in subsection 3(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Stock represented by such Shares certificates. (c) As soon as practicable after the exercise of the Warrants in full or in part, and in any event within 10 days thereafter, the Company at its expense will cause to be issued in the name of, and delivered to, the Registered Holder, or, subject to the terms and conditions hereof, as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full shares of Warrant Stock to which such Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which such Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 5 hereof; and (ii) in case such exercise is in part only, a new warrant certificate or warrant certificates (dated the date that hereof) of like tenor, calling in the aggregate on the face or faces thereof for the number of shares of Warrant Stock equal (without giving effect to any adjustment therein) to the number of such Notice shares called for on the face of Exercise and payment shall have been received the Warrant minus the number of such shares purchased by the CompanyRegistered Holder upon such exercise as provided in subsection 3(a) above.

Exercise. (a) The This Warrant may be exercised by the Registered Holder, in whole or in part, by the surrender of this Warrant (with the Notice of Exercise Price per share Form attached hereto as Exhibit I duly executed by such Registered Holder) at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant designate, accompanied by payment in full, in lawful money of the United States, of an amount equal to Section 2the then applicable Purchase Price multiplied by the number of Warrant Shares then being purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above. At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such Shares certificates. (c) As soon as practicable after the exercise of the purchase right represented by this Warrant, the Company at its expense will use its best efforts to cause to be issued in the name of the Registered Holder and delivered to GKN Securities Corp. or K▇▇▇▇▇ Securities Corp., as the case may be, for deposit in the Registered Holder's securities account or, subject to the terms and conditions hereof, to such other individual or entity as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct in writing: (i) a certificate or certificates for the number of full shares of Warrant Shares to which such Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which such Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof, and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, stating on the face or faces thereof the number of shares currently stated on the face of this Warrant minus the number of such Notice of Exercise and payment shall have been received shares purchased by the CompanyRegistered Holder upon such exercise as provided in subsection 1(a) above.

Exercise. (a) The Exercise Price per share of Subject to the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to limitation in Section 2. (b) The Option 4.2(c), the Warrants may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders whole or in part at any time or from time to time at any time and from time to time on or after the Option date such Warrant becomes exercisable Vested on any day that is a Business Day, for all or any part of the number of Warrant Shares purchasable upon its exercise, in accordance with Section 2 (the “Notice of Exercise”)order to exercise any Warrant, which Notice of Exercise shall be delivered in whole or in part, a Holder will deliver to the Company in at the form, and in the manner, address designated by the Company from time pursuant to timeSection 12.4, (i) a written notice of such Holder's election to exercise its Warrants, which notice will specify the number of Warrant Shares to be purchased pursuant to such exercise, (ii) the Exercise Price, in an amount equal to the aggregate purchase price, for all Warrant Shares to be purchased pursuant to such exercise, in cash or other immediately available funds, and (iiiii) paying its Warrant(s). Such notice will be substantially in the Exercise Price per shareform of the subscription form attached to the Warrants. If permitted by In the Company, this Option may be exercised in fractions by paying the percentage case of payment of all or a portion of the Exercise Price per share represented pursuant to Section 4.4(b), the direction by the fractional purchase. exercising Holder to make a Cashless Exercise (cas defined below) Payment shall serve as accompanying payment for that portion of the Exercise Price per share may be made, at your election, with the approval Price. Upon receipt of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and paymentsubscription form, the Company shall issue will, as promptly as practicable, and in any event within three (3) Business Days, execute, or cause to be issuedexecuted, in accordance with and deliver to such Notice of Exercise, Holder a certificate or certificates representing the aggregate number of Shares Warrant Shares, as provided In this Agreement. The stock certificate or certificates so delivered will be in such denominations as may be specified in such Notice notice and will be registered in the name of Exercisesuch Holder, issued in your name or in such other name or names of any immediate family member a Permitted Transferee as designated in such Notice of Exercisenotice. The Option shall A Warrant will be deemed to have been exercised and exercised, such Shares shall certificate or certificates will be deemed to have been issued, and you such Holder or any other family member(s) Person so designated or named in such Notice of Exercise shall notice will be deemed for all purposes to have become a holder of record of such Shares shares for all purposes, as of the date that such Notice notice, together with payment of the Exercise Price and payment shall have been the Warrant(s), is received by the Company. If a Warrant has been exercised in part, the Company will, at the time of delivery of such certificate or certificates, deliver to such Holder a new Warrant evidencing the rights of such Holder to purchase a number of Warrant Shares with respect to which the Warrant has not been exercised, which new Warrant will, In all other respects, be identical with the Warrants, or, at the request of such Holder, appropriate notation may be made on the Warrant and the Warrant shall be returned to such Holder. (b) Each exercising Holder shall have the right to pay all or a portion of the Exercise Price by making a "Cashless Exercise" pursuant to this Section 4.4(b), in which case the portion of the Exercise Price to be so paid shall be paid by reducing the number of Warrant Shares otherwise issuable pursuant to the exercise by an amount equal to (A) the aggregate Exercise Price to be so paid divided by (B) the Market Value Per Share. The number of shares of Common Stock to be issued to the exercising Holder as a result of a Cashless Exercise will therefore be as follows: (Market Value Per Share-Exercise Price per share) x Cashless Exercise Amount* Market Value Per Share The cashless Exercise Amount in the above formula is that portion of the Exercise Amount (expressed as a number of shares of Common Stock) with respect to which the Exercise Price is being paid by Cashless Exercise pursuant to this Section 4.4(b).

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as Exhibit I duly executed by the Registered Holder or by the Registered Holder’s duly authorized attorney, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may designate, accompanied by payment in full, in lawful money of the United States, of the Purchase Price payable in respect of the number of Warrant Shares purchased upon such exercise; provided however that this Warrant may only be exercised if it becomes as to vested Warrant Shares, and shall vest and become exercisable pursuant as follows: in twelve (12) consecutive equal monthly amounts at the end of each calendar month starting April 30, 2012 such that all Warrant Shares are vested in full on March 31, 2013 (the “Fully Vested Date”), unless the Agreement dated April 13, 2010 by and among Prof. Avi Israeli, the Registered Holder and the Company (the “Agreement”) is terminated prior to Section 2the Fully Vested Date, in which case no further Warrant Shares shall vest on or after the date of such termination. Upon termination of the Agreement vesting shall cease and the Registered Holder shall be entitled to exercise this Warrant only with respect to the portion of the Warrant Shares that shall have vested prior to the date of termination of the Agreement, rounded to the nearest number without decimal. The Warrant shall be valid until and may be exercised only on or before the earliest of the following: (i) immediately prior to a sale of all or substantially all of the shares of the Company in a merger and/or acquisition transaction; (ii) the Expiration Date; or (iii) six (6) months following the termination of the Agreement. Immediately after such date all unexercised Warrant Shares shall expire and be forfeited, and this Warrant shell terminate. (b) The Option may be exercised Registered Holder may, at its option, elect to pay some or all of the Purchase Price payable upon an exercise of this Warrant by canceling a portion of this Warrant exercisable for such number of Warrant Shares as is determined by dividing (i) providing written notice to the Company total Purchase Price payable in respect of the form prescribed number of Warrant Shares being purchased upon such exercise by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the excess of the Fair Market Value per share of Common Stock (as defined below) as of the Exercise Date (as defined in subsection 1(c) below) over the Purchase Price per share. If permitted the Registered Holder wishes to exercise this Warrant pursuant to this method of payment with respect to the maximum number of Warrant Shares purchasable pursuant to this method, then the number of Warrant Shares so purchasable shall be equal to the total number of Warrant Shares, minus the product obtained by multiplying (x) the Companytotal number of Warrant Shares by (y) a fraction, this Option may the numerator of which shall be exercised in fractions by paying the percentage Purchase Price per share and the denominator of which shall be the Fair Market Value per share of Common Stock as of the Exercise Price Date. The Fair Market Value per share represented of Common Stock shall be determined as follows: (i) If the Common Stock is listed on a national securities exchange or another nationally recognized trading system as of the Exercise Date, the Fair Market Value per share of Common Stock shall be deemed to be the average of the high and low reported sale prices per share of Common Stock thereon on the trading day immediately preceding the Exercise Date (provided that if no such price is reported on such day, the Fair Market Value per share of Common Stock shall be determined pursuant to clause (ii)). (ii) If the Common Stock is not listed on a national securities exchange or another nationally recognized trading system as of the Exercise Date, the Fair Market Value per share of Common Stock shall be deemed to be the amount most recently determined by the fractional purchaseBoard of Directors to represent the fair market value per share of the Common Stock (including without limitation a determination for purposes of granting Common Stock options or issuing Common Stock under an employee benefit plan of the Company); and, upon request of the Registered Holder, the Board of Directors (or a representative thereof) shall promptly notify the Registered Holder of the Fair Market Value per share of Common Stock. Notwithstanding the foregoing, if the Board of Directors has not made such a determination within the three-month period prior to the Exercise Date, then (A) the Board of Directors shall make a determination of the Fair Market Value per share of the Common Stock within 15 days of a request by the Registered Holder that it do so, and (B) the exercise of this Warrant pursuant to this subsection 1(b) shall be delayed until such determination is made. (c) Payment Each exercise of this Warrant shall be deemed to have been effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above (the “Exercise Date”). At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1(d) below shall be deemed to have become the holder or holders of record of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Warrant Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, represented by any method pre-approved by the Companysuch certificates. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice exercise of Exercise this Warrant in full or in part, and paymentin any event within 10 days thereafter, the Company shall issue or Company, at its expense, will cause to be issuedissued in the name of, in accordance with and delivered to, the Registered Holder, or as such Notice Holder (upon payment by such Holder of Exercise, any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full Warrant Shares specified to which the Registered Holder shall be entitled upon such exercise plus, in such Notice of Exercise, issued in your name or in such other name or names lieu of any immediate family member designated fractional share to which the Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof; and (ii) in case such Notice exercise is in part only, a new warrant or warrants (dated the date hereof) of Exercise. The Option shall be deemed like tenor, calling in the aggregate on the face or faces thereof for the number of Warrant Shares equal (without giving effect to have been exercised and such Shares shall be deemed any adjustment therein) to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record the number of such shares called for on the face of this Warrant minus the sum of (a) the number of such shares purchased by the Registered Holder upon such exercise plus (b) the number of Warrant Shares as (if any) covered by the portion of this Warrant cancelled in payment of the date that Purchase Price payable upon such Notice of Exercise and payment shall have been received by the Companyexercise pursuant to subsection 1(b) above.

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as Exhibit I duly executed by the Registered Holder or by the Registered Holder’s duly authorized attorney, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant to Section 2designate, accompanied by payment in full, in lawful money of the United States, of the Purchase Price payable in respect of the number of Warrant Shares purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above (the “Exercise Date”). At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such certificates. (c) As soon as practicable after the exercise of this Warrant in full or in part, and in any event within 10 days thereafter, the Company, at its expense, will cause to be issued in the name of, and delivered to, the Registered Holder, or as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full Warrant Shares as to which the Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which the Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof; and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, calling in the aggregate on the face or faces thereof for the number of Warrant Shares equal (without giving effect to any adjustment therein) to the number of such Notice shares called for on the face of Exercise and payment shall have been received this Warrant minus the sum of (a) the number of such shares purchased by the CompanyRegistered Holder upon such exercise.

Exercise. (a) The This Warrant may be exercised by the Registered Holder, in whole or in part, by the surrender of this Warrant (with the Notice of Exercise Price per share Form attached hereto as Exhibit I duly executed by such Registered Holder) at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant designate, accompanied by payment in full, in lawful money of the United States, of an amount equal to Section 2the then applicable Purchase Price multiplied by the number of Warrant Shares then being purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1 (a) above. At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1 (c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such Shares certificates. (c) As soon as practicable after the exercise of the purchase right represented by this Warrant, the Company at its expense will use its best efforts to cause to be issued in the name of the Registered Holder and delivered to you: (i) a certificate or certificates for the number of full shares of Warrant Shares to which such Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which such Registered Holder would otherwise be entitled, a Warrant Share representing the remainder of the fractional share to the next whole Warrant Share, and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, stating on the face or faces thereof the number of shares currently stated on the face of this Warrant minus the number of such Notice of Exercise and payment shall have been received shares purchased by the CompanyRegistered Holder upon such exercise as provided in section 1(a) above.

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as Exhibit A, --------- duly executed by such Holder, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant to Section 2designate, accompanied by payment in full by bank or certified check in lawful money of the United States, of the aggregate Purchase Price payable in respect of the total number of shares of Common Stock purchased upon such exercise. (b) The Option may Each exercise of this Warrant shall be exercised deemed to have been effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in Subsection 2(a) --------------- hereof. At such time, the person or persons in whose name or names any certificates for or other instruments evidencing shares of Common Stock shall be issuable upon such exercise as provided in Subsection 2(d) below shall be deemed --------------- to have become the holder or holders of record of the Common Stock represented by such certificates or other instruments. (i) providing written notice to the Company in the form prescribed by the stockholders from time to time The Holder may at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice of Exercise”), which Notice of Exercise shall be delivered to the Company in the formits sole option, and in lieu of paying the mannerPurchase Price pursuant to Subsection 2(a) hereof, designated exchange this --------------- Warrant in whole or in part for a number of shares of Common Stock as determined below. Such shares of Common Stock shall be issued by the Company from time to timethe Holder without payment by the Holder of any exercise price or any cash or other consideration. The number of shares of Common Stock to be so issued to the Holder shall be equal to the quotient obtained by dividing (A) the Surrendered Value (as defined below) on the date of surrender of this Warrant pursuant to Subsection ---------- 2(a), and by (B) the Fair Market Value on the Exchange Date of one share ---- of Common Stock. (ii) paying For the Exercise Price per share. If permitted by purposes of this Subsection 2(c), the Company, "Surrendered --------------- ----------- Value" of a portion of this Option may Warrant on a given date shall be exercised in fractions by paying deemed to ----- be the percentage difference between (A) the aggregate Fair Market Value on such date of the Exercise Price per share represented by the fractional purchase. (c) Payment total number of shares of Common Stock otherwise issuable upon exercise of such portion of the Exercise Warrant, minus (B) the aggregate Purchase Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Companysuch ----- number of shares of Common Stock. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice exercise of Exercise this Warrant in full or in part, and paymentin any event within three (3) business days thereafter, the Company shall issue or Company, at its expense will cause to be issuedissued in the name of, in accordance with and delivered to, the Holder, or, subject to the terms and conditions hereof, as such Notice Holder (upon payment by such Holder of Exercise, any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of Shares specified full shares of Common Stock to which such Holder shall be entitled upon such exercise, plus, in such Notice of Exercise, issued in your name or in such other name or names lieu of any immediate family member designated fractional share to which such Holder ---- would otherwise be entitled, cash in such Notice of Exercise. The Option shall be deemed an amount determined pursuant to have been exercised and such Shares shall be deemed to have been issuedSection 3 hereof, and you --------- (ii) in case such exercise is in part only, a new warrant or other family member(swarrants (dated the date hereof) designated of like tenor, calling in such Notice the aggregate on the face or faces thereof for the number of Exercise shall be deemed for all purposes shares of Common Stock equal (without giving effect to have become a holder of record any adjustment therein) to the Warrant Number minus the number of such Shares as shares of the date that such Notice of Exercise and payment shall have been received Common Stock purchased by the CompanyHolder upon such exercise.

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as EXHIBIT I duly executed by such Registered Holder or by such Registered ▇▇▇▇▇▇'s duly authorized attorney, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant to Section 2designate, accompanied by payment in full, in lawful money of the United States, of the Purchase Price payable in respect of the number of Warrant Shares purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above. At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issued upon such exercise as provided in subsection 1(d) below shall be deemed to have been issued, and you becomes the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such certificates. (c) As soon as practicable after the exercise of this Warrant in full or in part, and in any event within 10 days thereafter, the Company, at its expense, will cause to be issued in the name of, and delivered to, the Registered Holder, or as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full Warrant Shares as to which such Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which such Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof; and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, calling in the aggregate on the face or faces thereof for the number of Warrant Shares equal (without giving effect to any adjustment therein) to the number of such Notice shares called for on the face of Exercise and payment shall have been received this Warrant minus the number of such shares purchased by the CompanyRegistered Holder upon such exercise.

Exercise. (a) The Exercise Price per share of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Option Each Warrant may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time Registered Holder thereof at any time and from time to time on or after the Option becomes exercisable in accordance with Section 2 (Initial Exercise Date, but not after the “Notice of Exercise”)Warrant Expiration Date, which Notice of Exercise shall be delivered upon the terms and subject to the Company in the form, conditions set forth herein and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per shareapplicable Warrant Certificate. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option A Warrant shall be deemed to have been exercised immediately prior to the close of business on the Exercise Date and the person entitled to receive the securities deliverable upon such Shares exercise shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed treated for all purposes to have become a as the holder of record those securities upon the exercise of such Shares the Warrant as of the close of business on the Exercise Date. As soon as practicable on or after the Exercise Date, the Warrant Agent shall deposit the proceeds received from the exercise of a Warrant and shall notify the Company in writing of the exercise of the Warrants. Promptly following, and in any event within five days after the date of such notice from the Warrant Agent, the Warrant Agent, on behalf of the Company, shall cause to be issued and delivered by the Transfer Agent, to the person or persons entitled to receive the same, a certificate or certificates for the securities deliverable upon such exercise, (plus a Warrant Certificate for any remaining unexercised Warrants of the Registered Holder), unless prior to the date of issuance of such certificates the Company shall instruct the Warrant Agent to refrain from causing such issuance of certificates pending clearance of checks received in payment of the Purchase Price pursuant to such Warrants. Notwithstanding the foregoing, in the case of payment made in the form of a check drawn on an account of Royce or CBDC or such other investment banks and brokerage houses as the Company shall approve in writing to the Warrant Agent, certificates shall immediately be issued without prior notice to the Company or any delay. Upon the exercise of any Warrant and clearance of the funds received, the Warrant Agent shall promptly remit the payment received for the Warrant (the "Warrant Proceeds") to the Company or as the Company may direct in writing, subject to the provisions of Sections 4(b) and 4(c) hereof. (b) If, at the Exercise Date in respect of the exercise of any Warrant after , 1997, (i) the market price of the Company's Common Stock is greater than the then Purchase Price of the Warrant, (ii) the exercise of the Warrant was solicited by a member of the National Association of Securities Dealers, Inc. ("NASD") as designated in writing on the Warrant Certificate Subscription Form, (iii) the Warrant was not held in a discretionary account, (iv) disclosure of compensation arrangements was made both at the time of the original offering and at the time of exercise; and (v) the solicitation of the exercise of the Warrant was not in violation of Rule 10b-6 (as such rule or any successor rule may be in effect as of such time of exercise) promulgated under the Securities Exchange Act of 1934, then the Warrant Agent, simultaneously with the distribution of the Warrant Proceeds to the Company shall, on behalf of the Company, pay from the Warrant Proceeds, a fee of five percent (5%) (the "Solicitation Fee") of the Purchase Price to Royce, as Representative of the Underwriters; provided that such Notice of Exercise and payment either Royce or CBDC shall have been solicited the exercise of the applicable warrant as evidenced in writing in the Warrant Certificate Subscription Form. Upon receipt of the solicitation fee from the Warrant Agent, Royce shall in turn, if and as applicable, forward all (in the event that CBDC solicited the exercise of the applicable warrant as evidenced in writing in the Warrant Certificate Subscription Form) or, if unclear whether CBDC solicited the exercise of the applicable warrant, a portion of the Solicitation Fee to CBDC, to the extent that Royce, in its sole discretion shall determine (of which a portion may be reallowed to the dealer who solicited the exercise, which may also be an Underwriter). In the event the Solicitation Fee is not received within five days of the date on which the Company receives Warrant Proceeds, then the Solicitation Fee shall begin accruing interest at an annual rate of prime plus four percent (4%), payable by the Company.Company to the Underwriters at the time the Underwriters receives the Solicitation Fee. Within five days after exercise the Warrant Agent shall send to the Underwriters a copy of the reverse side of each

Exercise. (a) The This Warrant may be exercised by the Registered Holder, in whole or in part, by the surrender of this Warrant (with the Notice of Exercise Form attached hereto duly executed by such Registered Holder) at the principal office of the Company, or at such other office or agency as the Company may designate, accompanied by payment in full, in lawful money of the United States, of an amount equal to the then applicable Exercise Price per share multiplied by the number of Warrant Shares then being purchased upon such exercise, subject to the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to cashless exercise provisions set forth in Section 22.3(b) of this Warrant. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above, if so surrendered prior to 5:00 p.m., New York City time, or if surrendered after 5:00 p.m., New York City time, as of the next business day. At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1(c ), below, shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such Shares as certificates. (c) Unless exercising this Warrant in its entirety (or the then existing remainder of this Warrant in its entirety), exercises hereunder shall be only in full share increments. Within five (5) business days after the exercise of the purchase right represented by this Warrant, the Company at its expense will use its best efforts to cause to be issued in the name of, and delivered to, the Registered Holder, or, subject to the terms and conditions hereof (including the requirement that there be a registration statement then in effect with respect to transfers or an exemption therefrom), to such other individual or entity as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full Warrant Shares to which such Registered Holder shall be entitled upon such exercise (and, in lieu of any fractional share to which such Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof), and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, stating on the face or faces thereof the number of shares currently stated on the face of this Warrant minus the number of such Notice of Exercise and payment shall have been received shares purchased by the CompanyRegistered Holder upon such exercise as provided in subsection 1(a) above.

Exercise. (a) The This Warrant may be exercised one time, in whole or minimum increments of 100,000 shares, on any business day on or before the expiration date listed above by presentation and surrender hereof to the Corporation at its principal office of a written exercise request and the Exercise Price per share in lawful money of the Option is $0.25United States of America in the form of a wire transfer or check, subject to collection, for the Warrant Shares specified in the exercise request. If this Warrant should be exercised in part only, the Company shall, upon surrender of this Warrant, execute and deliver a new Warrant evidencing the rights of the Holder hereof to purchase the balance of the Warrant Shares purchasable hereunder. Upon receipt by the Corporation of an exercise request and representations, together with proper payment of the Exercise Price, at such office, the Holder shall be deemed to be the holder of record of the Warrant Shares, notwithstanding that the stock transfer books of the Corporation shall then be closed or that certificates representing such Warrant Shares shall not then be actually delivered to the Holder. The Option may only be exercised if it becomes exercisable pursuant to Section 2Corporation shall pay any and all transfer agent fees, documentary stamp or similar issue or transfer taxes payable in respect of the issue or delivery of the Warrant Shares. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at At any time and during the period from time issuance to time after expiration (the Option becomes exercisable "Exercise Period"), the Holder may, at its option, exchange this Warrant, in whole or minimum increments of 100,000 shares (a "Warrant Exchange"), into the number of Warrant Shares determined in accordance with this Section 2 (the “Notice of Exercise”1)(b), which Notice of Exercise shall be delivered to by surrendering this Warrant at the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval principal office of the Company, (i) if the Shares are readily tradable on accompanied by a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received written notice stating such Notice of Exercise and payment, the Company shall issue or cause Holder's intent to be issued, in accordance with effect such Notice of Exerciseexchange, the number of Warrant Shares to be exchanged and the date on which the Holder requests that such Warrant Exchange occur (the "Notice of Exchange"). The Warrant Exchange shall take place on the date the Notice of Exchange is received by the Company or such later date as may be specified in such the Notice of ExerciseExchange (the "Exchange Date"). Certificates for the shares issuable upon such Warrant Exchange and, issued in your name or in such other name or names if applicable, a new Warrant of any immediate family member designated in such Notice like tenor evidencing the balance of Exercise. The Option the shares remaining subject to this Warrant, shall be deemed to have been exercised and such Shares shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record of such Shares issued as of the date that such Exchange Date and delivered to the Holder within ten (10) days following the Exchange Date. In connection with any Warrant Exchange, this Warrant shall represent the right to subscribe for and acquire the number of Warrant Shares (rounded to the next highest integer) equal to (i) the number of Warrant Shares specified by the Holder in its Notice of Exchange (the "Total Number") less (ii) the number of Warrant Shares equal to the quotient obtained by dividing (A) the product of the Total Number and the existing Exercise and payment Price by (B) the current market value of a share of Common Stock. Current market value shall have been received by be the Companyaverage closing trading price for the 5 trading day period prior to the Exchange Date.

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as EXHIBIT A, duly executed by such Holder, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant to Section 2designate, accompanied by payment in full by bank or certified check in lawful money of the United States, of the aggregate Purchase Price payable in respect of the total number of shares of Common Stock purchased upon such exercise. (b) The Option may Each exercise of this Warrant shall be exercised deemed to have been effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in SUBSECTION 2(a) above. At such time, the person or persons in whose name or names any certificates for or other instruments evidencing shares of Common Stock shall be issuable upon such exercise as provided in SUBSECTION 2(d) below shall be deemed to have become the holder or holders of record of the Common Stock represented by such certificates or other instruments. (i) providing written notice to the Company in the form prescribed by the stockholders from time to time The Holder may at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice of Exercise”), which Notice of Exercise shall be delivered to the Company in the formits sole option, and in lieu of paying the mannerPurchase Price pursuant to SUBSECTION 2(a) hereof, designated exchange this Warrant in whole or in part for a number of shares of Common Stock as determined below. Such shares of Common Stock shall be issued by the Company from time to timethe Holder without payment by the Holder of any other exercise price or any cash or other consideration. The number of shares of Common Stock to be so issued to the Holder shall be equal to the quotient obtained by dividing (A) the Surrendered Value (as defined below) on the date of surrender of this Warrant pursuant to SUBSECTION 2(a), and by (B) the Fair Market Value on the exchange date of one share of Common Stock. (ii) paying For the Exercise Price per share. If permitted by purposes of this SUBSECTION 2(c), the Company, "SURRENDERED VALUE" of a portion of this Option may Warrant on a given date shall be exercised in fractions by paying deemed to be the percentage difference between (A) the aggregate Fair Market Value on such date of the Exercise Price per share represented by the fractional purchase. (c) Payment total number of shares of Common Stock otherwise issuable upon exercise of such portion of the Exercise Warrant, MINUS (B) the aggregate Purchase Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Companysuch total number of shares of Common Stock. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice exercise of Exercise this Warrant in full or in part, and paymentin any event within three (3) business days thereafter, the Company shall issue or Company, at its expense, will cause to be issuedissued in the name of, in accordance with and delivered to, the Holder, or, subject to the terms and conditions hereof, as such Notice Holder (upon payment by such Holder of Exercise, any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of Shares specified full shares of Common Stock to which such Holder shall be entitled upon such exercise, PLUS, in such Notice of Exercise, issued in your name or in such other name or names lieu of any immediate family member designated fractional share to which such Holder would otherwise be entitled, cash in an amount determined pursuant to SECTION 3 hereof, and (ii) in case such Notice exercise is in part only, a new warrant or warrants (dated the date hereof) of Exercise. The Option shall be deemed like tenor, calling in the aggregate on the face or faces thereof for the number of shares of Common Stock equal (without giving effect to have been exercised and such Shares shall be deemed any adjustment therein) to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record the Warrant Number minus the number of such Shares as shares of the date that such Notice of Exercise and payment shall have been received Common Stock purchased by the CompanyHolder upon such exercise.

Exercise. (a) The This Warrant may be exercised by the Registered Holder by surrendering this Warrant, along with the purchase form appended hereto as Exhibit A duly executed and completed by the Registered Holder or by the Registered Holder's duly authorized attorney, at the principal office of the Company, or at such other office or agency as the Company may designate by notice in writing to the Registered Holder, accompanied by a certified or cashier's check payable to the Company (or wire transfer of immediately available funds), in lawful money of the United States, of the Exercise Price per share payable in respect of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2number of Warrant Shares purchased upon such exercise (the "Aggregate Exercise Price"). (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above (the "Exercise Date"). At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such certificates. (c) Within a reasonable amount of time after the date of exercise of this Warrant, the Company will cause to be issued in the name of, and delivered to, the Registered Holder, or, upon payment by such Registered Holder of any applicable transfer taxes, its designee, a certificate or certificates for the nearest whole number of Warrant Shares as to which the Registered Holder shall be entitled upon such exercise; provided, however, that the Company shall not be required to pay any tax that may be payable in respect of any transfer involving the issuance and delivery of any such certificate in a name other than that of the date Registered Holder and the Company shall not be required to issue or deliver certificates until the person requesting the issuance thereof shall have paid the Company the amount of tax or shall have established to the Company that such Notice of Exercise tax has been paid. (d) The Company shall not be required to register, list or qualify the Warrant Shares pursuant to the Act or any applicable securities law or regulation or take any other actions so that the Warrant Shares may be offered and payment shall have been received by sold to the Companypublic.

Exercise. (a) The Exercise Price per share of Except as otherwise permitted under the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Plan, this Option may be exercised or surrendered during the Holder's lifetime only by the Holder or his/her guardian or legal representative. EXCEPT AS OTHERWISE PERMITTED UNDER THE PLAN, THIS OPTION SHALL NOT BE TRANSFERABLE BY THE HOLDER OTHERWISE THAN BY WILL OR BY THE LAWS OF DESCENT AND DISTRIBUTION. With the Company's consent which may granted or withheld in its sole discretion, Options may be transferred to certain permitted assignees, such as certain relatives of, or entities controlled by, the Participant, as more fully set forth in Section 8.3 of the Plan. This Option shall vest and be exercisable as follows: -------------------------------------------------------------------------------- Vesting Date Shares Vested at Vesting Date Cumulative Shares -------------------------------------------------------------------------------- [vesting schedule] -------------------------------------------------------------------------------- This Option shall be exercised by the Holder (or by her executors, administrators, guardian or legal representative) as to all or part of the Shares, by the giving of written notice of exercise to the Company, specifying the number of Shares to be purchased, accompanied by payment of the full purchase price for the Shares being purchased. Full payment of such purchase price shall be made at the time of exercise and shall be made (i) providing written notice to in cash or by certified check or bank check or wire transfer of immediately available funds, (ii) with the consent of the Company, by tendering previously acquired Shares (valued at their then Fair Market Value (as defined in the Plan), as determined by the Company in as of the form prescribed by date of tender) that have been owned for a period of at least six months (or such other period to avoid accounting charges against the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice of Exercise”Company's earnings), which Notice or (iii) with the consent of Exercise the Company, a combination of (i) and (ii). Such notice of exercise, accompanied by such payment, shall be delivered to the Company in the form, and in the manner, designated by at its principal business office or such other office as the Company may from time to timetime direct, and (ii) paying shall be in such form, containing such further provisions as the Exercise Price per shareCompany may from time to time prescribe. If permitted by the Company, In no event may this Option may be exercised in fractions by paying for a fraction of a Share. The Company shall effect the percentage transfer of Shares purchased pursuant to an Option as soon as practicable, and, within a reasonable time thereafter, such transfer shall be evidenced on the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval books of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company . No person exercising this Option shall have received such Notice any of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice rights of Exercise, the number a holder of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The subject to this Option shall be deemed to have been exercised and until certificates for such Shares shall be deemed to have been issued, and you issued following the exercise of such Option. No adjustment shall be made for cash dividends or other family member(s) designated in such Notice of Exercise shall be deemed rights for all purposes which the record date is prior to have become a holder of record the date of such Shares as of the date that such Notice of Exercise and payment shall have been received by the Companyissuance.

Exercise. (a) The This Warrant must be exercised, in whole or in part, (i) immediately prior to the time of the consummation of the first Change of Control (contemplated by clause (i) of such definition) following the date hereof or (ii) any time during the three (3) year period following the consummation of a Change of Control (contemplated by clause (ii) of such definition), in either case, by surrender of the Warrant to the Corporation at the address referred to in Section 9 hereof or such other place designated by the Corporation in writing delivered to the Holder, accompanied by a form of Warrant Exercise, in substantially the form attached as Annex A to this Warrant, duly executed by the Holder and accompanied by payment, in cash (including by wire transfer) or by certified or official bank check payable to the order of the Corporation in the amount obtained by multiplying (a) the number of Shares designated in such Warrant Exercise by (b) the Exercise Price per share (as defined below), and the Holder shall thereupon be entitled to receive the number of duly authorized, validly issued, fully paid and nonassessable Shares determined as provided in Section 4 hereof. The Corporation shall deliver written notice to any Holder at least 10 business days prior to the anticipated date of consummation of any Change of Control and any exercise thereby of this Warrant shall be conditional upon the consummation of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2transaction described in any such notice. (b) The Option may be exercised by (iEach exercise of a Warrant under Section 2(a) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option hereof shall be deemed to have been exercised effected immediately prior to the Change of Control, and at such time the party in whose name any certificate for Shares shall be issuable shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a the holder of record thereof. (c) As soon as practicable after each exercise of such Shares as a Warrant, in whole or in part (but no later than five (5) business days thereafter), the Corporation will cause to be issued in the name of and delivered to the date that such Notice of Exercise and payment shall have been received by Holder, the Company.following:

Exercise. (a) The This Warrant may be exercised by the Registered Holder, in whole or in part, by the surrender of this Warrant (with the Notice of Exercise Price per share Form attached hereto as Exhibit I duly executed by such Registered Holder) at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant designate, accompanied by payment in full, m lawful money of the United States, of an amount equal to Section 2the then applicable Purchase Price multiplied by the number of Warrant Shares then being purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1 (a) above. At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1 (c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such Shares certificates. (c) As soon as practicable after the exercise of the purchase right represented by this Warrant, the Company at its expense will use its best efforts to cause to be issued in the name of the Registered Holder and delivered to you: (i) a certificate or certificates for the number of full shares of Warrant Shares to which such Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which such Registered Holder would otherwise be entitled, a Warrant Share representing the remainder of the fractional share to the next whole Warrant Share, and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, stating on the face or faces thereof the number of shares currently stated on the face of this Warrant minus the number of such Notice of Exercise and payment shall have been received shares purchased by the CompanyRegistered Holder upon such exercise as provided in subsection 1 (a) above.

Exercise. (a) The Exercise Price per share Subject to the requirements of Section 4, this Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as Exhibit I duly executed by such Registered Holder or by such Registered Holder's duly authorized attorney, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant to Section 2designate, accompanied by payment in full, in lawful money of the United States, or with an equal principal amount the Company's 6% Subordinated Notes due May 1, 2001, of the Purchase Price payable in respect of the number of shares of Warrant Shares purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above. At such Shares time, the person or persons in whose name or names any certificates for warrant shares shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Shares represented by such certificates. (c) As soon as practicable after the exercise of this Warrant in full or in part, and in any event within 10 days thereafter, the Company, at its expense, will cause to be issued in the name of, and delivered to, the Registered Holder, or such Holder (upon payment by such Holder of any applicable transfer taxes) as the Holder may direct: (i) a certificate or certificates for the number of full Warrant Shares as to which such Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which such Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 2 hereof; and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, calling in the aggregate on the face or faces thereof for the number of Warrant Shares equal (without giving effect to any adjustment therein) to the number of such Notice shares called for on the face or this Warrant minus the number of Exercise and payment shall have been received such shares purchased by the CompanyRegistered Holder upon such exercise as provided in subsection 1(a) above.

Exercise. (a) The This Warrant may be exercised, in whole or in -------- part, by surrendering this Warrant, at the principal office of the Company, with the Election to Exercise form set forth at the end hereof duly executed, and by paying in full, the Warrant Price per for each share of Common Stock as to which this Warrant is exercised and any applicable taxes, other than taxes that the Option Company is $0.25required to pay hereunder. The Option Such payment may only be exercised if it becomes exercisable pursuant to Section 2(i) in cash or by bank check or (ii) by transfer of all or a portion of a Note or Notes duly endorsed by, or accompanied by appropriate instruments of transfer duly executed by, the registered holder or by his duly authorized attorney, valued at the principal amount thereof and accrued and unpaid interest thereon (other than unpaid interest not payable until the Due Date (as defined in the Notes), with any excess of the Warrant Price over such value paid in cash or by bank check. (b) The Option As soon as practicable after the exercise of this Warrant, the Company shall cause to be issued to or upon the order of the holder of this Warrant a certificate or certificates for the number of full shares of Common Stock to which he is entitled, registered in such name or names as may be exercised directed by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchasehim. (c) Payment Anything contained herein to the contrary notwithstanding, the Company shall not be required to issue any fraction of a share in connection with the exercise of this Warrant, but in any case where the holder hereof would, except for the provisions of this Section 2.03, be entitled under the terms of this Warrant to receive a fraction of a share upon the exercise of hereof, the Company shall, upon the exercise of this Warrant and receipt of the Exercise Price per Warrant Price, issue a certificate for the largest number of full shares of Common Stock then called for hereby and pay a sum in cash equal to the market value of such fraction of a share may be made, at your election, with (based upon the approval closing market price of the CompanyCommon Stock on the principal stock exchange on which it is listed (or, (i) if not listed on any stock exchange, the Shares are readily tradable last sale price on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the sameNASDAQ National Market System, or (iiif not listed or admitted to trading on such system, the closing bid price in the over-the-counter market) if on the Shares are not readily tradable on day preceding such exercise). The Warrantholder by his acceptance of this Warrant expressly waives his right to receive any fraction of a national securities market, by any method pre-approved by the Companyshare. (d) As soon as practicable but not later than five Business Days after All shares of Common Stock issued upon the exercise of this Warrant shall be validly issued, fully paid and non-assessable, and the Company shall have received pay all taxes in respect of the issue thereof. The Company shall not be required, however, to pay any tax imposed in connection with any transfer involved in the issuance of a certificate for shares of Common Stock or any other securities in any name other than that of the holder of this Warrant; and in such Notice of Exercise and payment, case the Company shall not be required to issue or cause deliver any such certificate until such tax shall have been paid. (e) Each person in whose name any such certificate for shares of Common Stock is issued shall for all purposes be deemed to be issuedhave become the holder of record of such shares on the date on which this Warrant was surrendered and payment of the purchase price and any applicable taxes was made, in accordance with irrespective of the date of delivery of such Notice certificate, except that, if the date of Exercisesuch surrender and payment is a date when the stock transfer books of the Company are closed, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option person shall be deemed to have been exercised and such Shares shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a the holder of record such shares at the close of such Shares as of business on the next succeeding date that such Notice of Exercise and payment shall have been received by on which the Companystock transfer books are open.

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, with the Purchase Form appended hereto as Exhibit A duly executed by such Registered Holder, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant to Section 2designate, accompanied by payment in full, by bank or certified check in lawful money of the United States, of the Purchase Price payable in respect of the number of shares of Warrant Stock purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above. At such Shares time, the person or persons in whose name or names any certificates for Warrant Stock shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Stock represented by such Shares certificates. (c) As soon as practicable after the exercise of this Warrant in full or in part, and in any event within ten (10) days thereafter, the Company at its expense will cause to be issued in the name of, and delivered to, the Registered Holder, or, subject to the terms and conditions hereof, as the Registered Holder (upon payment by the Registered Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full shares of Warrant Stock to which such Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which such Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof, and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, calling in the aggregate on the face or faces thereof for the number of shares of Warrant Stock equal (without giving effect to any adjustment therein) to the number of such Notice shares called for on the face of Exercise and payment shall have been received this Warrant minus the number of such shares purchased by the CompanyRegistered Holder upon such exercise as provided in subsection 1(a) above.

Exercise. (a) The This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as Exhibit A duly executed by such Registered Holder, at the principal office of the Company, or at such other office or agency as the Company may designate, accompanied by payment in full, in lawful money of the United States, of the Exercise Price per share payable in respect of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2number of shares of Warrant Stock being purchased upon such exercise. (b) The Option may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice Each exercise of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which the Warrant shall have been surrendered to the Company as provided in subsection 1(a) above. At such Shares time, the person or persons in whose name or names any certificates for Warrant Stock shall be issuable upon such exercise as provided in subsection 1(c) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Warrant Stock represented by such Shares certificates. (c) As soon as practicable after the exercise of this Warrant in full or in part, and in any event within five business days after clearance of the funds constituting the Exercise Price, the Company at its expense will cause to be issued in the name of, and delivered to, the Registered Holder, or, subject to the terms and conditions hereof, as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of shares of Warrant Stock to which such Registered Holder shall be entitled upon such exercise, and (ii) in case such exercise is in part only, a new warrant or warrants (dated the date that hereof) of like tenor, calling in the aggregate on the face or faces thereof for the 1 number of shares of Warrant Stock equal (without giving effect to any adjustment therein) to the number of such Notice shares called for on the face of Exercise and payment shall have been received this Warrant, minus the number of such shares purchased by the CompanyRegistered Holder upon such exercise as provided in subsection 1(a) above.

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as Exhibit I duly executed by such Holder, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant to Section 2designate, accompanied by payment in full by bank or certified check in lawful money of the United States, of the Purchase Price payable in respect of the number of shares of Common Stock purchased upon such exercise. (b) The Option may Each exercise of this Warrant shall be exercised deemed to have been effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 2(a) above. At such time, the person or persons in whose name or names any certificates for or other instruments evidencing shares of Common Stock shall be issuable upon such exercise as provided in subsection 2(d) below shall be deemed to have become the holder or holders of record of the Common Stock represented by such certificates or other instruments. (i) providing written notice The Holder may at its sole option and in lieu of paying the Purchase Price pursuant to the Company subsection 2(a) hereof, exchange this Warrant in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable whole or in accordance with Section 2 (the “Notice part for a number of Exercise”), which Notice shares of Exercise Common Stock as determined below. Such shares of Common Stock shall be delivered to the Company in the form, and in the manner, designated issued by the Company from time to time, and the Holder without payment by the Holder of any exercise price or any cash or other consideration. The number of shares of Common Stock to be so issued to the Holder shall be equal to the quotient obtained by dividing (A) the Surrendered Value (as defined below) on the date of surrender of this Warrant pursuant to subsection 2(a) by (B) the Fair Market Value on the Exchange Date of one share of Common Stock. (ii) paying For the Exercise Price per share. If permitted by purposes of this subsection 2(c), the Company, "Surrendered Value" of a portion of this Option may Warrant on a given date shall be exercised in fractions by paying deemed to be the percentage difference between (A) the aggregate Fair Market Value of the Exercise Price per share represented by the fractional purchase. (c) Payment number of shares of Common Stock otherwise issuable upon exercise of such portion of the Exercise Warrant, minus (B) the aggregate Purchase Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Companysuch number of shares of Common Stock. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice exercise of Exercise this Warrant in full or in part, and paymentin any event within three (3) business days thereafter, the Company shall issue or at its expense will cause to be issuedissued in the name of, in accordance with and delivered to, the Holder, or, subject to the terms and conditions hereof, as such Notice Holder (upon payment by such Holder of Exercise, any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of Shares specified full shares of Common Stock to which such Holder shall be entitled upon such exercise, plus, in such Notice of Exercise, issued in your name or in such other name or names lieu of any immediate family member designated fractional share to which such Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof, and (ii) in case such Notice exercise is in part only, a new warrant or warrants (dated the date hereof) of Exercise. The Option shall be deemed like tenor, calling in the aggregate on the face or faces thereof for the number of shares of Common Stock equal (without giving effect to have been exercised and such Shares shall be deemed any adjustment therein) to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record the Warrant Number minus the number of such Shares as shares of the date that such Notice of Exercise and payment shall have been received Common Stock purchased by the CompanyHolder upon such exercise.

Exercise. (a) The Exercise Price per share of Subject to Section 8, the Option is $0.25shall be exercisable during Grantee’s lifetime only by Grantee. The Subject to the provisions of Section 4(b) below, the Option may only be exercised by the delivery to the Company of a written notice of such exercise (the “Exercise Notice”), which notice shall specify the number of Option Shares to be purchased (the “Purchased Shares”) and the aggregate Exercise Price for such shares; provided, however, that payment of such aggregate Exercise Price may be made, in whole or in part, by one or more of the following means: (i) in full in cash or by check to the order of the Company, at or before the time the Company delivers the Option Shares; (ii) the recipient of the Option irrevocably authorizing a broker approved in writing by the Company to sell Option Shares to be acquired through exercise of the Option and remitting to the Company a sufficient portion of the sale proceeds to pay the entire exercise price and any federal and state withholding resulting from such exercise (a “Cashless Exercise”); provided, however, that, notwithstanding anything in this Agreement to the contrary, (A) the Company shall only deliver such Option Shares at or after the time the Company receives full payment for such Option Shares, (B) the exercise price for such Option Shares will be due and payable to the Company no later than one business day following the date on which the proceeds from the sale of the underlying Option Shares are received by the authorized broker, (C) in no event will the Company directly or indirectly extend or maintain credit, arrange for the extension of credit or renew any extension of credit, in the form of a personal loan or otherwise, in connection with a Cashless Exercise and (D) in no event shall the recipient of an Award enter into any agreement or arrangement with a brokerage or similar firm in which the proceeds received in connection with a Cashless Exercise will be received by or advanced to such recipient before the date the shares underlying the Award are delivered or released by the Company; and/or (iii) the delivery to the Company of a certificate or certificates representing shares of Common Stock, duly endorsed or accompanied by a duly executed stock power, which delivery effectively transfers to the Company good and valid title to such shares, free and clear of any pledge, commitment, lien, claim or other encumbrance (such shares to be valued on the basis of their aggregate fair market value as of the day immediately preceding the date of exercise of the Option; provided, however, that such payment in stock instead of cash shall not be effective and shall be rejected by the Company if it becomes exercisable pursuant (A) the Company is then prohibited from purchasing or acquiring such shares of Common Stock or (B) the right or power of the person exercising the Option to Section 2deliver such shares in payment of said purchase price is subject to the prior interests of any other person (excepting the Company) as indicated by legends upon the certificate(s) or as known to the Company. If the Company rejects the payment in stock, the tendered Exercise Notice shall not be effective hereunder unless promptly after being notified of such rejection, the person exercising the Option pays the purchase price in a form acceptable hereunder. (b) The Option may be exercised by Notwithstanding any provision of this Agreement to the contrary: (i) providing written notice payment of the aggregate Exercise Price for such shares and the Grantee’s tax withholding obligation, if any, with respect to such shares shall be due the Company in date the form prescribed by the stockholders from time to time at any time and from time to time after shares of Common Stock underlying the Option becomes exercisable in accordance with Section 2 (the “Notice of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and are delivered; and (ii) paying in no event shall the Exercise Price per share. If permitted by Company issue or deliver the Company, this Option may be exercised in fractions by paying Shares before the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program Company receives payment for the same, or (ii) if the Option Shares are not readily tradable on a national securities market, by any method pre-approved by the Companypursuant to this Section 4. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option shall be deemed to have been exercised and such Shares shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record of such Shares as of the date that such Notice of Exercise and payment shall have been received by the Company.

Exercise. (a) The Exercise Price per share of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Option may be exercised by (i) providing Each Member desiring to accept the offer contained in the Participation Notice shall accept such offer by furnishing a written notice of such acceptance to the Company in the form prescribed by the stockholders from time to time at any time and from time to time within ten (10) days after the Option becomes exercisable in accordance with Section 2 (the “Notice date of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by the Company, this Option may be exercised in fractions by paying the percentage delivery of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Participation Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, specifying the number of New Shares specified (not to exceed the Participation Portion of the total number of New Shares to be included in the Post-Closing Issuance) which such Notice Member desires to purchase or the amount of Exercise, New Debt (not to exceed the Participation Portion of the total amount of New Debt to be issued in your name or the Post-Closing Issuance) which such Member desires to purchase (each a “Participating Member”). Each Member who does not accept such offer in such other name or names of any immediate family member designated in such Notice of Exercise. The Option compliance with the above requirements shall be deemed to have been exercised waived all of such Member’s rights to participate in such Post-Closing Issuance, and the Company shall thereafter be free to issue New Shares or New Debt, as the case may be, in such Shares Post-Closing Issuance to the Participating Members, at the same per share price or pursuant to the same terms as set forth in the Participation Notice. (ii) The acceptance of each Participating Member shall be deemed to have been issuedirrevocable except as hereinafter provided, and you each such Participating Member shall be bound and obligated to acquire in the Post-Closing Issuance at the same price per share such number of New Shares or other family member(s) designated such amount of New Debt as such Participating Member shall have specified in such Notice of Exercise Participating Member’s written commitment; provided, that such Participating Member’s commitment shall be deemed for all purposes to have become revocable upon the occurrence of a holder of record of such Shares as material change, whether positive or negative, in the Company’s business, operations, condition (financial or otherwise), assets, liabilities or prospects. Notwithstanding the foregoing, if the Company does not consummate the proposed sale of the date that such Notice New Shares or the issuance of Exercise and payment New Debt, then each Participating Member shall have been received by be under no obligation to acquire any New Shares or loan any funds or acquire any debt securities in connection with the Companyissuance of New Debt.

Exercise. (a) The Exercise Price per share Once vested, the Performance Options can be exercised to purchase stock of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant Company subject to Section 2. this option, in whole or in part, from time to time, during Recipient’s Term of Employment and for a period of six (b6) The Option may be exercised by months after the earlier to occur of (i) providing the termination of Recipient’s Term of Employment (for whatever reason other than Cause) or (ii) the closing of the Change in Control event. Performance Options not exercised within such 6-month period shall immediately terminate. Performance Options existing upon Recipient’s termination for Cause shall terminate immediately upon termination of employment. The purchase price for each share subject to this Performance Option shall be $______, which is the purchase price of each share of stock of the Company on the date immediately prior to the date of this Agreement. To exercise a purchase right, Recipient shall provide written notice to the Company of the number of shares desired to be purchased along with a check for good funds to satisfy the full price, or where permitted by law: (a) by Recipient’s surrender of shares of the Company’s Common Stock that have been held by Recipient for at least six (6) months or so long as the Company does not recognize for financial accounting purposes a charge for compensation expense, that (i) either (A) have been paid for within the meaning of SEC Rule 144 (and, if such shares were purchased from the Company by use of a promissory note, such note has been fully paid with respect to such shares); or (B) were obtained by Recipient in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, open public market; and (ii) paying the Exercise Price per share. If permitted by are clear of all liens, claims, encumbrances or security interests; or (b) provided that a public market for the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, ’s stock exists: (i) if the Shares are readily tradable on a national securities market, through a “cashless exercisesame day sale” in accordance with commitment from Recipient and a Company-established policy or program designated broker-dealer that is a member of the Financial Industry Regulatory Authority (a “Dealer”) whereby Recipient irrevocably elects to exercise the Option and to sell a portion of the shares so purchased sufficient to pay for the sametotal purchase price for all shares being acquired (including those that are being sold to pay the purchase price) and whereby the Dealer irrevocably commits upon receipt of such shares to forward the total purchase price directly to the Company, or (ii) if through a “margin” commitment from Recipient and a Dealer whereby Recipient irrevocably elects to exercise the Shares are not readily tradable on Option and to pledge the shares so purchased to the Dealer in a national securities marketmargin account as security for a loan from the Dealer in the amount of the total purchase price, and whereby the Dealer irrevocably commits upon receipt of such shares to forward the total purchase price directly to the Company; or (c) by any method pre-approved by combination of cash and/or the foregoing. Provided that the exercise notice and payment are in form and substance satisfactory to counsel for the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause the shares registered in the name of Recipient and, to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, extent share certificates are issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option shall be deemed to have been exercised and such Shares shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record of such Shares as of the date that such Notice of Exercise and payment shall have been received by the Company, shall deliver certificates representing the shares with the appropriate legends affixed thereto.

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as Exhibit I duly executed by the Registered Holder or by the Registered Holder’s duly authorized attorney, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may designate, accompanied by payment in full, in lawful money of the United States, of the Purchase Price payable in respect of the number of Warrant Shares purchased upon such exercise; provided however that this Warrant may only be exercised if it becomes as to vested Warrant Shares, and shall vest and become exercisable pursuant as follows: in twelve (12) consecutive equal monthly amounts at the end of each calendar month starting April 30, 2014 such that all Warrant Shares are vested in full on March 31, 2015 (the “Fully Vested Date”), unless the Agreement dated April 13, 2010 by and among Prof. Avi Israeli, the Registered Holder and the Company (the “Agreement”) is terminated prior to Section 2the Fully Vested Date, in which case no further Warrant Shares shall vest on or after the date of such termination. Upon termination of the Agreement vesting shall cease and the Registered Holder shall be entitled to exercise this Warrant only with respect to the portion of the Warrant Shares that shall have vested prior to the date of termination of the Agreement, rounded to the nearest number without decimal. The Warrant shall be valid until and may be exercised only on or before the earliest of the following: (i) immediately prior to a sale of all or substantially all of the shares of the Company in a merger and/or acquisition transaction; (ii) the Expiration Date; or (iii) six (6) months following the termination of the Agreement. Immediately after such date all unexercised Warrant Shares shall expire and be forfeited, and this Warrant shall terminate. (b) The Option may be exercised Registered Holder may, at its option, elect to pay some or all of the Purchase Price payable upon an exercise of this Warrant by canceling a portion of this Warrant exercisable for such number of Warrant Shares as is determined by dividing (i) providing written notice to the Company total Purchase Price payable in respect of the form prescribed number of Warrant Shares being purchased upon such exercise by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, and in the manner, designated by the Company from time to time, and (ii) paying the excess of the Fair Market Value per share of Common Stock (as defined below) as of the Exercise Date (as defined in subsection 1(c) below) over the Purchase Price per share. If permitted the Registered Holder wishes to exercise this Warrant pursuant to this method of payment with respect to the maximum number of Warrant Shares purchasable pursuant to this method, then the number of Warrant Shares so purchasable shall be equal to the total number of Warrant Shares, minus the product obtained by multiplying (x) the Companytotal number of Warrant Shares by (y) a fraction, this Option may the numerator of which shall be exercised in fractions by paying the percentage Purchase Price per share and the denominator of which shall be the Fair Market Value per share of Common Stock as of the Exercise Price Date. The Fair Market Value per share represented of Common Stock shall be determined as follows: (i) If the Common Stock is listed on a national securities exchange or another nationally recognized trading system as of the Exercise Date, the Fair Market Value per share of Common Stock shall be deemed to be the average of the high and low reported sale prices per share of Common Stock thereon on the trading day immediately preceding the Exercise Date (provided that if no such price is reported on such day, the Fair Market Value per share of Common Stock shall be determined pursuant to clause (ii)). (ii) If the Common Stock is not listed on a national securities exchange or another nationally recognized trading system as of the Exercise Date, the Fair Market Value per share of Common Stock shall be deemed to be the amount most recently determined by the fractional purchaseBoard of Directors to represent the fair market value per share of the Common Stock (including without limitation a determination for purposes of granting Common Stock options or issuing Common Stock under an employee benefit plan of the Company); and, upon request of the Registered Holder, the Board of Directors (or a representative thereof) shall promptly notify the Registered Holder of the Fair Market Value per share of Common Stock. Notwithstanding the foregoing, if the Board of Directors has not made such a determination within the three-month period prior to the Exercise Date, then (A) the Board of Directors shall make a determination of the Fair Market Value per share of the Common Stock within 15 days of a request by the Registered Holder that it do so, and (B) the exercise of this Warrant pursuant to this subsection 1(b) shall be delayed until such determination is made. (c) Payment Each exercise of this Warrant shall be deemed to have been effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in subsection 1(a) above (the “Exercise Date”). At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in subsection 1(d) below shall be deemed to have become the holder or holders of record of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Warrant Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, represented by any method pre-approved by the Companysuch certificates. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice exercise of Exercise this Warrant in full or in part, and paymentin any event within 10 days thereafter, the Company shall issue or Company, at its expense, will cause to be issuedissued in the name of, in accordance with and delivered to, the Registered Holder, or as such Notice Holder (upon payment by such Holder of Exercise, any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of full Warrant Shares specified to which the Registered Holder shall be entitled upon such exercise plus, in such Notice of Exercise, issued in your name or in such other name or names lieu of any immediate family member designated fractional share to which the Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof; and (ii) in case such Notice exercise is in part only, a new warrant or warrants (dated the date hereof) of Exercise. The Option shall be deemed like tenor, calling in the aggregate on the face or faces thereof for the number of Warrant Shares equal (without giving effect to have been exercised and such Shares shall be deemed any adjustment therein) to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record the number of such shares called for on the face of this Warrant minus the sum of (a) the number of such shares purchased by the Registered Holder upon such exercise plus (b) the number of Warrant Shares as (if any) covered by the portion of this Warrant cancelled in payment of the date that Purchase Price payable upon such Notice of Exercise and payment shall have been received by the Companyexercise pursuant to subsection 1(b) above.

Exercise. (a) The Exercise Price per share of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Option Each Warrant may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time Registered Holder thereof at any time and from time to time on or after the Option becomes exercisable in accordance with Section 2 (Initial Exercise Date, but not after the “Notice of Exercise”)Warrant Expiration Date, which Notice of Exercise shall be delivered upon the terms and subject to the Company in the form, conditions set forth herein and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per shareapplicable Warrant Certificate. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option A Warrant shall be deemed to have been exercised immediately prior to the close of business on the Exercise Date and the person entitled to receive the securities deliverable upon such Shares exercise shall be deemed to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed treated for all purposes to have become a as the holder of record those securities upon the exercise of such Shares the Warrant as of the close of business on the Exercise Date. As soon as practicable on or after the Exercise Date, the Warrant Agent shall deposit the proceeds received from the exercise of a Warrant and shall notify the Company in writing of the exercise of the Warrants. Promptly following, and in any event within five days after the date that of such Notice notice from the Warrant Agent, the Warrant Agent, on behalf of Exercise the Company, shall cause to be issued and payment shall have been received delivered by the Transfer Agent, to the person or persons entitled to receive the same, a certificate or certificates for the securities deliverable upon such exercise, (plus a Warrant Certificate for any remaining unexercised Warrants of the Registered Holder) unless prior to the date of issuance of such certificates the Company shall instruct the Warrant Agent to refrain from causing such issuance of certificates pending clearance of checks received in payment of the Purchase Price pursuant to such Warrants. Notwithstanding the foregoing, in the case of payment made in the form of a check (b) If, at the Exercise Date in respect of the exercise of any Warrant after ______, 199_, (i) the market price of the Company's Common Stock is greater than the then Purchase Price of the Warrant, (ii) the exercise of the Warrant was solicited by a member of the National Association of Securities Dealers, Inc. ("NASD") as designated in writing on the Warrant Certificate Subscription Form, (iii) the Warrant was not held in a discretionary account, (iv) disclosure of compensation arrangements was made both at the time of the original offering and at the time of exercise; and (v) the solicitation of the exercise of the Warrant was not in violation of Rule 10b-6 (as such rule or any successor rule may be in effect as of such time of exercise) promulgated under the Securities Exchange Act of 1934, then the Warrant Agent, simultaneously with the distribution of the Warrant Proceeds to the Company shall, on behalf of the Company, pay from the Warrant Proceeds, a fee of 5% (the "Blai▇ ▇▇▇") of the Purchase Price to Blai▇, ▇▇less Blai▇ ▇▇▇uses or is unable to solicit such exercise (of which a portion may be reallowed by Blai▇ ▇▇ the dealer who solicited the exercise, which may also be Blai▇ ▇▇ D.H. ▇▇▇▇▇ & ▇o., Inc., unless Blai▇ ▇▇▇uses or is unable to solicit such exercise). In the event the Blai▇ ▇▇▇ is not received within five days of the date on which the Company receives Warrant Proceeds, unless such failure to make payment occurs as a result of actions by a person other than the Company and the Company has used its best efforts to cause the Blai▇ ▇▇▇ to be paid, then the Blai▇ ▇▇▇ shall begin accruing interest at an annual rate of prime plus four percent (4%), payable by the Company to Blai▇ ▇▇ the time Blai▇ ▇▇▇eives the Blai▇ ▇▇▇. Within five days after exercise the Warrant Agent shall send to Blai▇ ▇ ▇opy of the reverse side of each Warrant exercised. Blai▇ ▇▇▇ll reimburse the Warrant Agent, upon request, for its reasonable expenses relating to compliance with this section 4(b). The Company shall pay all fees and expenses including all blue sky fees and expenses and all out-of-pocket expenses of Blai▇, ▇▇cluding legal fees, in connection with the solicitation, redemption or exchange of the Warrants, unless Blai▇ ▇▇▇uses or is unable to solicit such exercise. In addition, Blai▇ ▇▇▇ the Company may at any time during business hours, examine the records of the Warrant Agent, including its ledger of original Warrant Certificates returned to the Warrant Agent upon exercise of Warrants. The provisions of this paragraph may not be modified, amended or deleted without the prior written consent of Blai▇. (c) In order to enforce the provisions of Section 4(b) above, in the event there is any dispute or question as to the amount or payment of the Blai▇ ▇▇▇, the Warrant Agent is hereby expressly authorized to withhold payment to the Company of the Warrant Proceeds unless and until the Company establishes an escrow account for the purpose of depositing the entire amount of the Blai▇ ▇▇▇, which amount will be deducted from the net Warrant Proceeds to be paid to the Company. The funds placed in the escrow account may not be released to the

Exercise. (a) The Exercise Price per share This Warrant may be exercised by the Holder, in whole or in part, by surrendering this Warrant, with the purchase form appended hereto as Exhibit A, duly executed by such Holder, at the principal office of the Option is $0.25. The Option Company, or at such other office or agency as the Company may only be exercised if it becomes exercisable pursuant to Section 2designate, accompanied by payment in full by bank or certified check in lawful money of the United States, of the aggregate Purchase Price payable in respect of the total number of shares of Common Stock purchased upon such exercise. (b) The Option may Each exercise of this Warrant shall be exercised deemed to have been effected immediately prior to the close of business on the day on which this warrant shall have been surrendered to the Company as provided in Subsection 2(a) above. At such time, the person or persons in whose name or names any certificates for or other instruments evidencing shares of Common Stock shall be issuable upon such exercise as provided in Subsection 2(d) below shall be deemed to have become the holder or holders of record of the Common Stock represented by such certificates or other instruments. (i) providing written notice to the Company in the form prescribed by the stockholders from time to time The Holder may, at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice of Exercise”)his, which Notice of Exercise shall be delivered to the Company in the formher or its sole option, and in lieu of paying the mannerPurchase Price pursuant to Subsection 2(a) hereof, designated exchange this Warrant in whole or in part for a number of shares of Common Stock as determined below. Such shares of Common Stock shall be issued by the Company from time to timethe Holder without payment by the Holder of any other exercise price or any cash or other consideration. The number of shares of Common Stock to be so issued to the Holder shall be equal to the quotient obtained by dividing (A) the Surrendered Value (as defined below) on the date of surrender of this Warrant pursuant to Subsection 2(a), and by (B) the Fair Market Value on the exchange date of one share of Common Stock. (ii) paying For the Exercise Price per share. If permitted by purposes of this Subsection 2(c), the Company, "Surrendered Value" of a portion of this Option may Warrant on a given date shall be exercised in fractions by paying deemed to be the percentage excess of (A) the aggregate Fair Market Value on such date of the Exercise Price per share represented by the fractional purchase. (c) Payment total number of shares of Common Stock otherwise issuable upon exercise of such portion of the Exercise Warrant, over (B) the aggregate Purchase Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Companysuch total number of shares of Common Stock. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice exercise of Exercise this Warrant in full or in part, and paymentin any event within three (3) business days thereafter, the Company shall issue or Company, at its expense, will cause to be issuedissued in the name of, in accordance with and delivered to, the Holder, or, subject to the terms and conditions hereof, as such Notice Holder (upon payment by such Holder of Exercise, any applicable transfer taxes) may direct: (i) a certificate or certificates for the number of Shares specified full shares of Common Stock to which such Holder shall be entitled upon such exercise, plus, in such Notice of Exercise, issued in your name or in such other name or names lieu of any immediate family member designated fractional shares to which such Holder would otherwise be entitled, cash in an amount determined pursuant to Section 3 hereof, and (ii) in case such Notice exercise is in part only, a new warrant or warrants (dated the date hereof) of Exercise. The Option shall be deemed like tenor, calling in the aggregate on the face or faces thereof for the number of shares of Common Stock equal (without giving effect to have been exercised and such Shares shall be deemed any adjustment therein) to have been issued, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record the Warrant Number minus the number of such Shares as shares of the date that such Notice of Exercise and payment shall have been received Common Stock purchased by the CompanyHolder upon such exercise.

Exercise. (a) The Exercise Price per share This Warrant shall become exercisable by the Registered Holder only if, and at such time as, the following conditions have been satisfied: (i) Within twenty days from the date of issuance of this Warrant, the Company shall have received a blanket purchase order issued by Creative (including entities affiliated with Creative), relating to the purchase by Creative of an aggregate of at least * of the Option is $0.25. The Option may only Company's products during the twelve months following the date of issuance of this Warrant, on the terms set forth in the Distribution Agreement; AND (ii) Concurrently with the issuance of such purchase order, Creative Technology Ltd. shall deliver funds in the amount of * to the Company, to be exercised if it becomes exercisable pursuant to applied * , in accordance with Section 24.1(c) of the Distribution Agreement. (b) The Option Upon satisfaction of the conditions set forth in Section 1(a) above, this Warrant may be exercised by (i) providing written notice to the Company in the form prescribed by the stockholders from time to time Registered Holder at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice of Exercise”), which Notice of Exercise shall be delivered prior to the Company Expiration Date, in whole or in part, by surrendering this Warrant, with the formpurchase form appended hereto as EXHIBIT A duly executed by such Registered Holder or by such Registered Holder's duly authorized attorney, and in at the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per share. If permitted by principal office of the Company, this Option or at such other office or agency as the Company may be exercised designate, accompanied by payment in fractions full by paying the percentage cash, check or wire transfer of the Exercise Purchase Price per share represented by payable in respect of the fractional purchasenumber of shares of Common Stock purchased upon such exercise. (c) Payment Each exercise of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option this Warrant shall be deemed to have been exercised and effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in Section 1(b) above. At such Shares time, the person or persons in whose name or names any certificates for Common Stock shall be issuable upon such exercise as provided in Section 1(e) below shall be deemed to have been issued, and you become the holder or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder holders of record of the Common Stock represented by such Shares as of the date that such Notice of Exercise and payment shall have been received by the Companycertificates.

Exercise. (a) The Exercise Price per share of the Option is $0.25. The Option may only be exercised if it becomes exercisable pursuant to Section 2. (b) The Option A. Each Stock Right represented by a Stock Right Certificate may be exercised by (i) providing written notice during the Stock Right Exercise Period, upon the terms and subject to the Company in the form prescribed by the stockholders from time to time at any time and from time to time after the Option becomes exercisable in accordance with Section 2 (the “Notice of Exercise”), which Notice of Exercise shall be delivered to the Company in the form, conditions herein and in the manner, designated by the Company from time to time, and (ii) paying the Exercise Price per shareapplicable Stock Right Certificate. If permitted by the Company, this Option may be exercised in fractions by paying the percentage of the Exercise Price per share represented by the fractional purchase. (c) Payment of the Exercise Price per share may be made, at your election, with the approval of the Company, (i) if the Shares are readily tradable on a national securities market, through a “cashless exercise” in accordance with a Company-established policy or program for the same, or (ii) if the Shares are not readily tradable on a national securities market, by any method pre-approved by the Company. (d) As soon as practicable but not later than five Business Days after the Company shall have received such Notice of Exercise and payment, the Company shall issue or cause to be issued, in accordance with such Notice of Exercise, the number of Shares specified in such Notice of Exercise, issued in your name or in such other name or names of any immediate family member designated in such Notice of Exercise. The Option A Stock Right shall be deemed to have been exercised and immediately prior to the close of business on the Exercise Date, provided that the Stock Right Certificate representing such Shares Stock Right, with the exercise form thereon duly executed by the Registered Holder thereof or his or her attorney duly authorized in writing (or if a Stock Right Certificate has not been issued to the Registered Holder thereof, by such other means as the Company shall agree) together with payment in cash or by personal check, or certified check made payable to an escrow or segregated account to be deemed designated by the Company, or an amount equal to have been issuedthe applicable Purchase Price, and you or other family member(s) designated in such Notice of Exercise shall be deemed for all purposes to have become a holder of record of such Shares as of the date that such Notice of Exercise and payment shall have has been received by the Company. Payment must be made in United States funds. The person entitled to receive the securities deliverable upon such exercise shall be treated for all purposes as the holder of such securities as of the close of business on the Exercise Date. As soon as practicable, on or after the Exercise Date, and in any event within thirty (30) days after such date, if a Stock Right has been exercised, the Company shall promptly cause to be issued to the person or persons entitled to receive the same, the Series A Preferred Stock on the Company's books and records (and, if requested, shall deliver certificates for the required whole number denominations to the persons entitled thereto). No adjustment shall be made in respect of dividends on any shares delivered upon exercise of any Stock Right. B. The Company shall not issue any fractional Share interests upon the exercise of any Stock Right. In place of fractional Share interests, the Company shall issue to the Registered Holder, at his or her written election, either (i) a cash payment for such fractional interest equal to a pro rata portion of the Purchase Price, or (ii) one additional whole share or option or warrant interest, as the case may be, upon the payment of the Registered Holder in the manner described above of an additional cash payment equal to the Purchase Price less the cash payment he or she would otherwise receive pursuant to the foregoing alternative (i).