$675,000 Uses in Sale and Payment for Ercole Shares Clause

Sale and Payment for Ercole Shares from Common Stock Purchase Agreement

This Series A-2 Preferred Stock and Common Stock Purchase Agreement (this Agreement) is entered into as of December 19, 2006 by and among Ercole Biotech, Inc., a Delaware corporation (the Ercole), and AVI BioPharma, Inc. (AVI).

Sale and Payment for Ercole Shares. Subject to the terms and conditions of this Agreement, Ercole hereby agrees to issue and sell to AVI and AVI hereby agrees to purchase from Ercole all of the Ercole Shares for an aggregate purchase price of $675,000 (the Purchase Price) consisting of one hundred ninety-two thousand, eight hundred fifty-seven (192,857) registered and freely tradeable shares of AVI Common Stock (the AVI Shares).