Common use of Anti-dilution Adjustment Clause in Contracts

Anti-dilution Adjustment. Other than in connection with Excepted Issuances (as such term is defined in the last sentence of this Section 8(b)), if within twelve months following the initial Closing of the sale of Shares in the Offering, the Company shall issue without the consent of the Majority Holders any Common Stock or securities convertible into or exercisable for shares of Common Stock (or modify the conversion or exercise price of any of the foregoing which may be outstanding) to any person or entity at a price per share which shall be less than 100% of the price per share of the Shares purchased by such Subscriber (including any issuances of securities in connection with the closing of a registered primary offering of any securities of the Company in any jurisdiction), subject to adjustment for stock dividends, subdivisions and combinations (the “Lower Price Issuance”), then the Company shall issue, for each such occasion, additional shares of Common Stock to the Subscriber respecting the Purchased Securities that are then still owned by the Subscriber at the time of the Lower Price Issuance so that the average per share purchase price of the Purchased Securities owned by the Subscriber on the date of the Lower Price Issuance plus such additional shares issued to Subscriber pursuant to this Section 8(b) is equal to such other lower price per share. The delivery to Subscriber of the additional shares of Common Stock shall be not later than the 5 Business Days after the closing date of the transaction giving rise to the requirement to issue additional shares of Common Stock. For purposes of the issuance and adjustment described in this Section 8(b), in the case of the issuance of securities convertible into or exercisable for shares of Common Stock, the price per share shall be deemed to be the quotient obtained by dividing (i) the sum of (A) the price paid for such derivative security plus (B) the aggregate amount of consideration to be paid upon conversion or exercise price of such security for the maximum number of shares for which the derivative security may be converted or exercised, by (ii) the total number of shares of common stock issuable upon conversion or exercise price of such security for the maximum number of shares for which the derivative security may be converted or exercised. The adjustment described in this Section 8(b) shall be made immediately upon the earlier of (x) the issuance of the derivative security or (y) the Company entering into an agreement to issue the derivative security, in each case at a price lower than the price per Share in the Offering (which price is subject to adjustment for stock dividends, subdivisions and combinations), but such adjustment shall not be made again upon any issuance of shares of Common Stock upon conversion of such derivative security. Any Common Stock or derivative security issued or issuable by the Company for no consideration or for consideration that cannot be determined at the time of issuance will be deemed issuable or to have been issued for $0.01 per share of Common Stock. The rights of Subscriber set forth in this Section 8 are in addition to any other rights the Subscriber has pursuant to this Agreement, any Transaction Documents, and any other agreement referred to or entered into in connection herewith or to which Subscriber and Company are parties. For purposes hereof, “Excepted Issuances” means the (i) Company’s issuances of securities comprising the full or partial consideration in connection with a strategic merger, acquisition, consolidation or purchase of substantially all of the securities or assets of a corporation or other entity that has been approved by a majority of disinterested directors of the Company and in which holders of such securities or debt are not at any time granted registration rights, (ii) the Company’s issuance of securities in connection with strategic license agreements and other partnering arrangements so long as such issuances are not for the purpose of raising capital and which holders of such securities or debt are not at any time granted registration rights, (iii) the Company’s issuance of common stock or its issuances or grants of options to purchase common stock to employees, directors, and officers of the Company pursuant to any stock or option plan duly adopted for such purpose, by a majority of the non-employee members of the Board of Directors or a majority of the members of a committee of non-employee directors established for such purpose, and (iv) the Company’s issuances of securities upon the exercise or exchange of or conversion of any securities exercisable or exchangeable for or convertible into shares of common stock issued and outstanding on the date of this Agreement, provided that such securities have not been amended since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securities.

Anti-dilution Adjustment. Other than in connection with Excepted Issuances (as such term If at any time while this Warrant is defined in the last sentence of this Section 8(b)), if within twelve months following the initial Closing of the sale of Shares in the Offeringoutstanding, the Company shall issue without sells or grants (or has sold or granted, as the consent case may be) any option to purchase or sells or grants any right to reprice, or otherwise disposes of or issues (or has sold or issued, as the Majority Holders case may be, or announces any sale, grant or any option to purchase or other disposition), any Common Stock Share or other securities convertible into or into, exercisable for shares of Common Stock (or modify otherwise entitled the conversion or exercise price of any of the foregoing which may be outstanding) to any person or entity the right to acquire Common Shares at a an effective price per share which shall be less that is lower than 100% the then Exercise Price (such lower price, the “Base Exercise Price” and such issuances, collectively, a “Dilutive Issuance”) (it being agreed that if the holder of the Common Share or other securities so issued shall at any time, whether by operation of purchase price adjustments, reset provisions, floating conversion, exercise or exchange prices or otherwise, or due to warrants, options or rights per share which are issued in connection with such issuance, be entitled to receive Common Shares at an effective price per share that is lower than the Exercise Price, such issuance shall be deemed to have occurred for less than the Exercise Price on such date of the Shares purchased by such Subscriber (including any issuances of securities in connection with the closing of a registered primary offering of any securities of the Company in any jurisdiction), subject to adjustment for stock dividends, subdivisions and combinations (the “Lower Price Dilutive Issuance”), then the Company Exercise Price shall issuebe reduced to a price equal the Base Exercise Price, for each and the number of Warrant Shares issuable hereunder shall be increased such occasionthat the aggregate Exercise Price payable hereunder, additional shares of Common Stock after taking into account the decrease in the Exercise Price, shall be equal to the Subscriber respecting aggregate Exercise Price prior to such adjustment. Such adjustment shall be made whenever such Common Share or other securities are issued, provided however, that no adjustment will be made under this Section 2(c) in respect of an Exempt Issuance. For purposes of this Section 2(c), an “Exempt Issuance” shall have the Purchased Securities that are then still owned by meaning ascribed to such term in the Subscriber at Note. In the time event of the Lower Price Issuance so that the average per share purchase price an issuance of the Purchased Securities owned by the Subscriber on the date of the Lower Price Issuance plus such additional shares issued to Subscriber securities involving multiple tranches or closings, any adjustment pursuant to this Section 8(b) is equal to such other lower price per share. The delivery to Subscriber of the additional shares of Common Stock shall be not later than the 5 Business Days after the closing date of the transaction giving rise to the requirement to issue additional shares of Common Stock. For purposes of the issuance and adjustment described in this Section 8(b), in the case of the issuance of securities convertible into or exercisable for shares of Common Stock, the price per share shall be deemed to be the quotient obtained by dividing (i) the sum of (A) the price paid for such derivative security plus (B) the aggregate amount of consideration to be paid upon conversion or exercise price of such security for the maximum number of shares for which the derivative security may be converted or exercised, by (ii) the total number of shares of common stock issuable upon conversion or exercise price of such security for the maximum number of shares for which the derivative security may be converted or exercised. The adjustment described in this Section 8(b2(c) shall be made immediately upon the earlier of (x) the issuance of the derivative security or (y) the Company entering into an agreement to issue the derivative security, in each case at a price lower than the price per Share in the Offering (which price is subject to adjustment for stock dividends, subdivisions and combinations), but calculated as if all such adjustment shall not be made again upon any issuance of shares of Common Stock upon conversion of such derivative security. Any Common Stock or derivative security securities were issued or issuable by the Company for no consideration or for consideration that cannot be determined at the time of issuance will be deemed issuable or to have been issued for $0.01 per share of Common Stock. The rights of Subscriber set forth in this Section 8 are in addition to any other rights the Subscriber has pursuant to this Agreement, any Transaction Documents, and any other agreement referred to or entered into in connection herewith or to which Subscriber and Company are parties. For purposes hereof, “Excepted Issuances” means the (i) Company’s issuances of securities comprising the full or partial consideration in connection with a strategic merger, acquisition, consolidation or purchase of substantially all of the securities or assets of a corporation or other entity that has been approved by a majority of disinterested directors of the Company and in which holders of such securities or debt are not at any time granted registration rights, (ii) the Company’s issuance of securities in connection with strategic license agreements and other partnering arrangements so long as such issuances are not for the purpose of raising capital and which holders of such securities or debt are not at any time granted registration rights, (iii) the Company’s issuance of common stock or its issuances or grants of options to purchase common stock to employees, directors, and officers of the Company pursuant to any stock or option plan duly adopted for such purpose, by a majority of the non-employee members of the Board of Directors or a majority of the members of a committee of non-employee directors established for such purpose, and (iv) the Company’s issuances of securities upon the exercise or exchange of or conversion of any securities exercisable or exchangeable for or convertible into shares of common stock issued and outstanding on the date of this Agreement, provided that such securities have not been amended since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securitiesinitial closing.

Anti-dilution Adjustment. Other than in connection with Excepted Issuances Until the earliest of (as such term is defined in a) the last sentence of this Section 8(b)), if within twelve months following the initial Closing second year anniversary of the sale of Shares in date hereof; or (b) the Offering, date that the Company shall issue without the consent of the Majority Holders any Common Stock or securities convertible into or exercisable for Company’s shares of Common Stock (are approved for listing on a national securities exchange, in the event that the Company issues or modify the conversion or exercise price sells any shares of any Common Stock pursuant to which shares of the foregoing which Common Stock may be outstanding) to any person or entity acquired at a price less than $0.14 per share which shall be less than 100% of the price per share of the Shares purchased by such Subscriber (including any issuances of securities in connection with the closing of a registered primary offering of any securities of the Company in any jurisdiction), subject to adjustment appropriate adjustments for any stock dividendsdividend, subdivisions and combinations stock split, stock combination, reclassification or similar transaction after the date hereof) (such lower price, the “Lower Price Base Price” and such issuances, collectively, a “Dilutive Issuance”), then the Company shall issue, for each such occasion, promptly issue additional shares of Common Stock to the Subscriber respecting the Purchased Securities that are then still owned by the Subscriber at the time of the Lower Price Issuance such Purchaser, for no additional consideration, in an amount sufficient so that the average per share purchase price pro rata portion of the Purchased Securities owned Purchase Price paid by such Purchaser hereunder attributable to the Subscriber on Shares then held, shall be reduced to a price (rounded to the date nearest cent) when multiplied by a fraction, of which (i) the Lower Price Issuance plus such additional shares issued to Subscriber pursuant to this Section 8(b) is equal to such other lower price per share. The delivery to Subscriber numerator shall be the number of the additional shares of Common Stock shall be not later than outstanding on a fully diluted basis immediately prior to such Dilutive Issuance plus the 5 Business Days after the closing date number of the transaction giving rise to the requirement to issue additional shares of Common Stock. For purposes of Stock which the issuance and adjustment described in this Section 8(b), in the case of the issuance of securities convertible into aggregate consideration received or exercisable for shares of Common Stock, the price per share shall be deemed to be received by the quotient obtained by dividing (i) the sum of (A) the price paid Company for such derivative security plus (B) the aggregate amount of consideration to be paid upon conversion or exercise price of such security for the maximum number of shares for which the derivative security may be converted or exercised, by (ii) the total number of shares of common stock issuable upon conversion or exercise price of such security for Common Stock issued pursuant to the maximum number of shares for which Dilutive Issuance would purchase at the derivative security may be converted or exercised. The adjustment described in this Section 8(bBase Price; and (ii) the denominator shall be made immediately upon the earlier of (x) the issuance of the derivative security or (y) the Company entering into an agreement to issue the derivative security, in each case at a price lower than the price per Share in the Offering (which price is subject to adjustment for stock dividends, subdivisions and combinations), but such adjustment shall not be made again upon any issuance number of shares of Common Stock upon conversion outstanding on a fully diluted basis immediately prior to such Dilutive Issuance plus the number of such derivative securityadditional shares of Common Stock so issued in connection with the Dilutive Issuance (such adjustment, a “Dilution Adjustment”). Any Such Dilution Adjustment shall be made successively whenever such an issuance is made. Notwithstanding the foregoing, this Section 5.1 shall not apply in respect of an Exempt Issuance (as herein defined). No adjustment shall be made hereunder which would require the Purchaser to surrender any shares of Common Stock to the Company. For the purposes of this Sub-Section, Exempt Issuance shall mean the issuance of (a) shares of Common Stock or derivative security issued or issuable by the Company for no consideration or for consideration that cannot be determined at the time of issuance will be deemed issuable or to have been issued for $0.01 per share of Common Stock. The rights of Subscriber set forth in this Section 8 are in addition to any other rights the Subscriber has pursuant to this Agreement, any Transaction Documents, and any other agreement referred to or entered into in connection herewith or to which Subscriber and Company are parties. For purposes hereof, “Excepted Issuances” means the (i) Company’s issuances of securities comprising the full or partial consideration in connection with a strategic merger, acquisition, consolidation or purchase of substantially all of the securities or assets of a corporation or other entity that has been approved by a majority of disinterested directors of the Company and in which holders of such securities or debt are not at any time granted registration rights, (ii) the Company’s issuance of securities in connection with strategic license agreements and other partnering arrangements so long as such issuances are not for the purpose of raising capital and which holders of such securities or debt are not at any time granted registration rights, (iii) the Company’s issuance of common stock or its issuances or grants of options to purchase common stock to employees, directors, and officers or directors of the Company pursuant to any stock or option plan duly adopted for such purpose, by a majority of the non-employee members Board of Directors (collectively, the “ESOP”) and (b) securities issued pursuant to acquisitions or strategic transactions approved by a majority of the Board of Directors Directors, provided that any such issuance shall only be to a Person (or to the equityholders of a majority Person) which is, itself or through its subsidiaries, an operating company or an owner of an asset in a business synergistic with the business of the members Company and shall provide to the Company additional benefits in addition to the investment of funds, but shall not include a committee transaction in which the Company is issuing securities primarily for the purpose of non-employee directors established for such purpose, and (iv) the Company’s issuances of securities upon the exercise raising capital or exchange of or conversion of any securities exercisable or exchangeable for or convertible into shares of common stock issued and outstanding on the date to an entity whose primary business is investing in securities. For purposes of this Agreement, provided that such securities have not been amended since the date of this Agreement to increase the number of such securities Person shall mean any individual, corporation, partnership, firm, joint venture, association, limited liability company, limited liability partnership, joint-stock company, trust, unincorporated organization or to decrease the exercise price, exchange price Governmental or conversion price of such securitiesRegulatory Authority.

Anti-dilution Adjustment. Other than in connection with Excepted Issuances (as such term is defined in the last sentence of If, while this Section 8(b))Warrant, if within twelve months following the initial Closing of the sale of Shares in the Offeringor any portion hereof, remains outstanding and unexpired, the Company shall issue without the consent issues or sells any class or series of securities or any instrument convertible into securities of the Majority Holders any Common Stock or securities convertible into or exercisable for shares of Common Stock (or modify the conversion or exercise price of any of the foregoing which may be outstanding) to any person or entity Company at a price per share such that the class of Warrant Shares into which this Warrant is exercisable are entitled to an anti-dilution adjustment pursuant to the COI, or if the conversion price of the class of Warrant Shares into which this Warrant is exercisable is otherwise being reduced, then such reduction shall be less than 100% deemed to apply automatically to the Warrant Shares purchasable by exercising this Warrant, such that upon such exercise, the conversion price of the Warrant Shares shall be that reduced conversion price determined for the class of shares constituting the Warrant Shares. Without derogating from the above, in the event that at any time during the Term of this Warrant, the Company issues to holders of shares constituting Warrant Shares at such time, shares of the Company at a price per share that is lower than the Exercise Price of such Warrant Shares at the Shares purchased by time of such Subscriber issuance or without receipt of consideration (including any issuances of securities including, without limitation, in connection with the closing of a registered primary offering of any securities of the Company in any jurisdictionanti-dilution adjustments and/or indemnification undertakings relating to such Warrant Shares), subject reflecting an average price per share for the aggregate number of (A) Warrant Shares of such class held by such holders prior to adjustment for stock dividendssuch issuance plus (B) the shares issued to them in such issuance, subdivisions and combinations that is lower than the Exercise Price applicable to the Warrant Shares at the time of such issuance (in each case, the “Lower Price IssuanceNew Price”), then the Company Exercise Price shall issue, for each such occasion, additional shares of Common Stock be reduced to the Subscriber respecting the Purchased Securities New Price; it being understood that are then still owned by the Subscriber at the time of the Lower Price Issuance so that the average per share purchase price of the Purchased Securities owned by the Subscriber on the date of the Lower Price Issuance plus such additional shares issued to Subscriber pursuant to this Section 8(b) is equal to such other lower price per share. The delivery to Subscriber of the additional shares of Common Stock shall be not later than the 5 Business Days after the closing date of the transaction giving rise to the requirement to issue additional shares of Common Stock. For purposes of the issuance and adjustment described in this Section 8(b), in the case of the issuance of securities convertible into or exercisable for shares of Common Stock, the price per share shall be deemed to be the quotient obtained by dividing (i) the sum of (A) the price paid for such derivative security plus (B) the aggregate amount of consideration to be paid upon conversion or exercise price of such security for the maximum number of shares for which the derivative security may be converted or exercised, by (ii) the total number of shares of common stock issuable upon conversion or exercise price of such security for the maximum number of shares for which the derivative security may be converted or exercised. The adjustment described in this Section 8(b) shall be made immediately upon the earlier of (x) the issuance of the derivative security or (y) the Company entering into an agreement to issue the derivative security, in each case at a price lower than the price per Share in the Offering (which price is subject to adjustment for stock dividends, subdivisions and combinations), but such adjustment shall not be made again upon any issuance if such new shares are issued to such holders as part of a bona fide investment transaction in which the shares of Common Stock upon conversion are issued in return for consideration representing the fair market value of such derivative security. Any Common Stock or derivative security issued or issuable shares, as determined by the Company for no consideration or for consideration that cannot be determined Board of Directors, at the time of issuance will (but without derogating from any reduction of the conversion price of the Warrant Shares issuable upon exercise hereof as may be deemed issuable or applicable in connection with such transaction pursuant to have been issued for $0.01 per share the first sentence of Common Stock. The rights of Subscriber set forth in this Section 8 are 12.4). For the avoidance of doubt, in addition no event shall the Holder be entitled to any other rights the Subscriber has receive more than one anti-dilution adjustment pursuant to this Agreement, any Transaction Documents, Section 12.4 such that no such anti-dilution adjustment will be made pursuant to this Section 12.4 to the extent that such adjustment is effected with respect to the Warrant Shares issued upon exercise hereof and any other agreement referred to or entered into in connection herewith or to which Subscriber and Company are parties. For purposes hereof, “Excepted Issuances” means the (i) Company’s issuances of securities comprising the full or partial consideration in connection with a strategic merger, acquisition, consolidation or purchase of substantially all Holder receives such adjustment upon conversion of the securities or assets of a corporation or other entity that has been approved by a majority of disinterested directors underlying preferred stock into common stock of the Company and in which holders of such securities or debt are not at any time granted registration rights, (ii) the Company’s issuance of securities in connection with strategic license agreements and other partnering arrangements so long as such issuances are not for the purpose of raising capital and which holders of such securities or debt are not at any time granted registration rights, (iii) the Company’s issuance of common stock or its issuances or grants of options to purchase common stock to employees, directors, and officers of the Company pursuant to any stock or option plan duly adopted for such purpose, by a majority of the non-employee members of the Board of Directors or a majority of the members of a committee of non-employee directors established for such purpose, and (iv) the Company’s issuances of securities upon the exercise or exchange of or conversion of any securities exercisable or exchangeable for or convertible into shares of common stock issued and outstanding on the date of this Agreement, provided that such securities have not been amended since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securities.

Anti-dilution Adjustment. Other than In the event of changes in connection with Excepted Issuances the outstanding Common Stock of the Company by reason of stock dividends, splits, Recapitalizations (as such term is defined hereinafter defined), reclassifications, combinations or exchanges of shares, separations, reorganizations, liquidations, or the like, the number and class of Conversion Shares available under this Note in the last sentence aggregate and the conversion price therefor shall be correspondingly adjusted to give the Holder, on conversion for the same aggregate price, the total number, class, and kind of shares as the Holder would have owned had the Note been exercised prior to the event and had the Holder continued to hold such shares until after the event requiring adjustment. The form of this Section 8(b)), if within twelve months following the initial Closing Note need not be changed because of the sale of Shares any adjustment in the Offeringnumber of Conversion Shares subject to this Note. Whenever the conversion price or the number of Conversion Shares purchasable hereunder shall be adjusted pursuant to this Section 3.5, the Company shall issue without prepare a certificate setting forth, in reasonable detail, the consent event requiring the adjustment, the amount of the Majority Holders adjustment, the method by which such adjustment was calculated. Such certificate shall be signed by its chief financial officer and shall be delivered to the Holder. For purposes of this Note, “Recapitalization” shall mean any Common Stock of the following actions by the Company, or securities any agreement or approval by the Company to undertake any of the foregoing: (i) any issuance of any additional stock or equity of the Company, including any common stock, preferred stock or other capital stock of the Company issued solely in connection with a restructuring of the entire capital structure of the Company, (ii) any issuance of any security convertible into or exercisable or exchangeable for, with or without consideration, any common stock, preferred stock or other capital stock of the Company issued solely in connection with a restructuring of the entire capital structure of the Company, (iii) any issuance of any option, warrant or other security carrying any warrant or right to subscribe to or purchase any common stock, preferred stock or other capital stock of the Company issued solely in connection with a restructuring of the entire capital structure of the Company, (iv) any stock split, stock dividends or combinations, (v) any reclassification or any change to rights, preferences, or designation of any class of the Company’s stock as of the date hereof, or (vi) the Company seeks to effect or set a record date for shares of Common Stock (or modify the conversion or exercise price of a shareholder vote with respect to any transaction that could result in any of the foregoing which may be outstanding) to any person or entity at a price per share which shall be less than 100% of the price per share of the Shares purchased by such Subscriber (including any issuances of securities in connection with the closing of a registered primary offering of any securities of the Company in any jurisdiction), subject to adjustment for stock dividends, subdivisions and combinations (the “Lower Price Issuance”), then the Company shall issue, for each such occasion, additional shares of Common Stock to the Subscriber respecting the Purchased Securities that are then still owned by the Subscriber at the time of the Lower Price Issuance so that the average per share purchase price of the Purchased Securities owned by the Subscriber on the date of the Lower Price Issuance plus such additional shares issued to Subscriber pursuant to this Section 8(b) is equal to such other lower price per share. The delivery to Subscriber of the additional shares of Common Stock shall be not later than the 5 Business Days after the closing date of the transaction giving rise to the requirement to issue additional shares of Common Stock. For purposes of the issuance and adjustment actions described in this Section 8(b)3.5, in the which case of the issuance of securities convertible into or exercisable for shares of Common Stock, the price per share shall be deemed to be the quotient obtained by dividing (i) the sum of (A) the price paid for such derivative security plus (B) the aggregate amount of consideration to be paid upon conversion or exercise price of such security for the maximum number of shares for which the derivative security may be converted or exercised, by (ii) the total number of shares of common stock issuable upon conversion or exercise price of such security for the maximum number of shares for which the derivative security may be converted or exercised. The adjustment described in this Section 8(b) shall be made immediately upon the earlier of (x) the issuance of the derivative security or (y) the Company entering into an agreement shall provide Holder with prior written notice of its intention to issue the derivative security, in each case at set a price lower than the price per Share in the Offering (which price is subject to adjustment for stock dividends, subdivisions and combinations), but such adjustment shall not be made again upon any issuance of shares of Common Stock upon conversion of such derivative security. Any Common Stock or derivative security issued or issuable by the Company for no consideration or for consideration that cannot be determined at the time of issuance will be deemed issuable or to have been issued for $0.01 per share of Common Stock. The rights of Subscriber set forth in this Section 8 are in addition to any other rights the Subscriber has pursuant to this Agreement, any Transaction Documents, and any other agreement referred to or entered into in connection herewith or to which Subscriber and Company are parties. For purposes hereof, “Excepted Issuances” means the (i) Company’s issuances of securities comprising the full or partial consideration in connection with a strategic merger, acquisition, consolidation or purchase of substantially all of the securities or assets of a corporation or other entity that has been approved by a majority of disinterested directors of the Company and in which holders of such securities or debt are not at any time granted registration rights, (ii) the Company’s issuance of securities in connection with strategic license agreements and other partnering arrangements so long as such issuances are not for the purpose of raising capital and which holders of such securities or debt are not at any time granted registration rights, (iii) the Company’s issuance of common stock or its issuances or grants of options to purchase common stock to employees, directors, and officers of the Company pursuant to any stock or option plan duly adopted for such purpose, by a majority of the non-employee members of the Board of Directors or a majority of the members of a committee of non-employee directors established for such purpose, and (iv) the Company’s issuances of securities upon the exercise or exchange of or conversion of any securities exercisable or exchangeable for or convertible into shares of common stock issued and outstanding on the date of this Agreement, provided that such securities have not been amended since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securitiesrecord date.

Anti-dilution Adjustment. Other than in connection with Excepted Issuances (as such term is defined in the last sentence of this Section 8(b)), if within twelve months following the initial Closing of the sale of Shares in the Offering, the Company shall issue without the consent of the Majority Holders If at any Common Stock or securities convertible into or exercisable for shares of Common Stock (or modify the conversion or exercise price of any of the foregoing which may be outstanding) to any person or entity at a price per share which shall be less than 100% of the price per share of the Shares purchased by such Subscriber (including any issuances of securities in connection with the closing of a registered primary offering of any securities of the Company in any jurisdiction), subject to adjustment for stock dividends, subdivisions and combinations (the “Lower Price Issuance”), then the Company shall issue, for each such occasion, additional shares of Common Stock to the Subscriber respecting the Purchased Securities that are then still owned by the Subscriber at the time of the Lower Price Issuance so that the average per share purchase price of the Purchased Securities owned by the Subscriber on from the date hereof until the earlier of the Lower Price Issuance plus such additional shares issued to Subscriber pursuant to this Section 8(b) is equal to such other lower price per share. The delivery to Subscriber of the additional shares of Common Stock shall be not later than the 5 Business Days after the closing date of the transaction giving rise to the requirement to issue additional shares of Common Stock. For purposes of the issuance and adjustment described in this Section 8(b), in the case of the issuance of securities convertible into or exercisable for shares of Common Stock, the price per share shall be deemed to be the quotient obtained by dividing (i) the sum of (A) ESD Issuer Bid Closing Date, if the price paid for ESD Indenture Amendment has failed to occur on or prior to such derivative security plus (B) the aggregate amount of consideration to be paid upon conversion or exercise price of such security for the maximum number of shares for which the derivative security may be converted or exercised, by date and (ii) the total number of Units Issuer Bid Closing Date, the Issuer issues any (a) shares of common stock issuable upon conversion its share capital; (b) warrants, options or exercise price of other rights entitling the holders thereof to purchase any such security for the maximum number of shares for which the derivative security may be converted or exercised. The adjustment described in this Section 8(b) shall be made immediately upon the earlier of (x) the issuance of the derivative security shares; or (yc) securities convertible or exchangeable into such shares or securities (the Company entering into an agreement to issue the derivative security, in each case at a price lower "EQUITY SECURITIES") (other than the price per Share in the Offering (which price is subject to adjustment for stock dividends, subdivisions and combinations), but such adjustment shall not be made again upon any issuance of shares of Common Stock upon conversion of such derivative security. Any Common Stock or derivative security Equity Securities issued or issuable by the Company for no consideration or for consideration that cannot be determined at the time of issuance will be deemed issuable or to have been issued for $0.01 per share of Common Stock. The rights of Subscriber set forth in this Section 8 are in addition to any other rights the Subscriber has pursuant to this Agreement, any Transaction Documents, and any other agreement referred to or entered into in connection herewith or to which Subscriber and Company are parties. For purposes hereof, “Excepted Issuances” means the (i) Company’s issuances of securities comprising the full or partial consideration in connection with a strategic merger, acquisition, consolidation or purchase of substantially all of the securities or assets of a corporation or other entity that has been approved by a majority of disinterested directors of the Company and in which holders of such securities or debt are not at any time granted registration rights, (ii) the Company’s issuance of securities in connection with strategic license agreements and other partnering arrangements so long as such issuances are not for the purpose of raising capital and which holders of such securities or debt are not at any time granted registration rights, (iii) the Company’s issuance of common stock or its issuances or grants of options to purchase common stock to employees, directors, and officers of the Company Issuer pursuant to any transactions contemplated in this Agreement or under any stock or option plan duly adopted incentive plans for such purposeits employees and directors contemplated in this Agreement), by a majority at an Average Price which is less than the Purchase Price, then the number of the non-employee members of the Board of Directors or a majority of the members of a committee of non-employee directors established for such purpose, and (iv) the Company’s issuances of securities Underlying Securities to be issued upon the exercise of the Special Warrants or exchange the Purchase Warrants, as the case may be, whether such Special Warrants or Purchase Warrants have been exercised or not, shall be adjusted prior to the exercise thereof, or retroactively after the exercise thereof, by multiplying such number of Underlying Securities provided in Section 2.2, Section 2.8(a), Section 2.8(d), Section 4.1(a) or conversion Section 4.6, as the case may be, by the quotient of the Purchase Price over the Average Price. If any securities exercisable of the Special Warrants or exchangeable for the Purchase Warrants, as the case may be, have been exercised prior to this adjustment, the Issuer shall issue to the Persons who exercised the Special Warrants or convertible into shares of common stock issued and outstanding on the date of this AgreementPurchase Warrants, provided that such securities have not been amended since as the date of this Agreement to increase case may be, the number of such securities or additional Underlying Securities, they would have been entitled to decrease receive had the adjustment become effective prior to the exercise priceof their Special Warrants or Purchase Warrants. For the avoidance of doubt, exchange price or conversion price it is intended that if there are multiple issuance transactions by the Issuer in the applicable period that involve Equity Securities being issued below the Purchase Price, then the provisions of this Section 5.1 shall apply to each such securitiesissuance.

Anti-dilution Adjustment. Other than (a) Understanding and agreeing that Buyer will control the Company following the purchase of the Shares and given Sellers would not enter into this transaction for the sale of the Shares without assurances from Buyer that Sellers will not be reduced or diluted in connection with Excepted Issuances (as such term is defined in the last sentence Sellers' ownership percentage of this Section 8(b))Common Stock below a certain number and percentage of shares, Buyer agrees if on, or within twelve months following after, the initial Closing closing of the sale of Shares in the Offeringtransactions described herein, the Company shall issue without the consent of the Majority Holders issues or sells, or is deemed to have issued or sold, any Common Stock or securities convertible into or exercisable for shares of Common Stock or common stock equivalents for a consideration of less than one dollar (or modify the conversion or exercise price of any of the foregoing which may be outstanding$1.00) to any person or entity at a price per share which shall be less than 100% of the price per share of the Shares purchased by such Subscriber (including any issuances of securities in connection with the closing of a registered primary offering of any securities of the Company in any jurisdiction), subject to adjustment for stock dividends, subdivisions and combinations (the “Lower Price Issuance”"Dilution Event"), then Sellers shall be entitled to receive from Buyer, that number of Shares necessary to provide Sellers with the Company shall issue, for each such occasion, additional same percentage of Shares as he held on the Closing of this Transaction assuming 15,000,000 shares of Common Stock are outstanding on the Closing of this Transaction. Furthermore, Buyer agrees to use his best efforts to cause the Company to not (i) reduce; through a reverse split, consolidation, or subdivide its outstanding Common Stock, combine its outstanding Common Stock into a smaller number of shares, issue by reclassification of its Common Stock other securities of the Company, or enter into any plan of capital reorganization or of reclassification of the Common Stock of the Company which would result in the reduction of the ownership interest of the Sellers below his current percentage of ownership assuming fifteen million (15,000,000) issued and outstanding shares of the Company's common stock and the Company will not issue any shares during the next twelve months that would increase the outstanding shares of Common Stock beyond the 15,000,000 shares except for cash consideration in excess of one dollar ($1.00) per share all of which would be considered a Dilution Event and subject to the Subscriber respecting the Purchased Securities that are then still owned by the Subscriber at the time adjustments set forth above with Buyer providing Sellers such number of the Lower Price Issuance so that the average per share purchase price of the Purchased Securities owned by the Subscriber Shares necessary to bring Sellers back to his percentage interest on the date of the Lower Price Issuance plus Closing. As security against such additional action, Buyer agree to hold one million (1,000,000) shares issued to Subscriber being purchased pursuant hereto in an escrow with Action Stock Transfer pursuant to the escrow agreement attached hereto as exhibit "B," to hold until such time as twelve months from the date of this Section 8(bAgreement or such date the shares are surrendered to Sellers to cover a Dilution Event. Each Seller shall receive their proportion of such Escrowed Shares in the event of a Dilution Event. (b) is equal Whenever the Sellers would be reduced below his percentage interest on the Closing of this Transaction, assuming a 15,000,000 Shares outstanding at Closing, Buyer shall promptly mail by first class mail, postage prepaid, to Sellers notice of such other lower price per share. The delivery adjustment or adjustments setting forth the number of Shares receivable to Subscriber restore Sellers to their agreed amounts after such adjustment, setting forth a brief statement of the additional shares facts requiring such adjustment and setting forth the computation by which such adjustment was made. (c) For the purpose of Common Stock shall be not later than the 5 Business Days after the closing date of the transaction giving rise to the requirement to issue additional shares of Common Stock. For purposes of the issuance and adjustment described in this Section 8(b), in the case of the issuance of securities convertible into or exercisable for shares of Common Stocksubsection, the price per share term "common stock" shall be deemed to be the quotient obtained by dividing mean (i) the sum class of (A) stock designated as the price paid for such derivative security plus (B) the aggregate amount of consideration to be paid upon conversion or exercise price of such security for the maximum number of shares for which the derivative security may be converted or exercised, by (ii) the total number of shares of common stock issuable upon conversion or exercise price of such security for the maximum number of shares for which the derivative security may be converted or exercised. The adjustment described in this Section 8(b) shall be made immediately upon the earlier of (x) the issuance of the derivative security or (y) the Company entering into an agreement to issue the derivative security, in each case at a price lower than the price per Share in the Offering (which price is subject to adjustment for stock dividends, subdivisions and combinations), but such adjustment shall not be made again upon any issuance of shares of Common Stock upon conversion of such derivative security. Any Common Stock or derivative security issued or issuable by the Company for no consideration or for consideration that cannot be determined at the time of issuance will be deemed issuable or to have been issued for $0.01 per share of Common Stock. The rights of Subscriber set forth in this Section 8 are in addition to any other rights the Subscriber has pursuant to this Agreement, any Transaction Documents, and any other agreement referred to or entered into in connection herewith or to which Subscriber and Company are parties. For purposes hereof, “Excepted Issuances” means the (i) Company’s issuances of securities comprising the full or partial consideration in connection with a strategic merger, acquisition, consolidation or purchase of substantially all of the securities or assets of a corporation or other entity that has been approved by a majority of disinterested directors of the Company and in which holders of such securities or debt are not at any time granted registration rights, (ii) the Company’s issuance of securities in connection with strategic license agreements and other partnering arrangements so long as such issuances are not for the purpose of raising capital and which holders of such securities or debt are not at any time granted registration rights, (iii) the Company’s issuance of common stock or its issuances or grants of options to purchase common stock to employees, directors, and officers of the Company pursuant to any stock or option plan duly adopted for such purpose, by a majority of the non-employee members of the Board of Directors or a majority of the members of a committee of non-employee directors established for such purpose, and (iv) the Company’s issuances of securities upon the exercise or exchange of or conversion of any securities exercisable or exchangeable for or convertible into shares of common stock issued and outstanding on the date of this Agreement, provided (ii) any other class of stock resulting from successive changes or reclassifications of such shares consisting solely of changes in par value, or from par value to no par value, or from no par value to par value; (iii) any stock option, warrant, stock appreciation right or other securities exercisable or convertible into shares of Common Stock, including but not limited to preferred stock or other securities or instruments such as promissory notes or other agreements that can be considered dilutive to Sellers or which have superior rights to the Common Stock or (iv) as a result of a merger, consolidation or reorganization of the Company into another company shall be those shares of securities designated as "common stock" by the successor corporation, and if such securities have not been amended since the date corporation's stock is traded, those series of stock which are traded. (d) For purposes of this Agreement to increase section, any reverse split or consolidations of the shares of the Company's common stock shall be considered a Dilution Event and in such case, the Buyer shall cause such number of such securities shares necessary to be issued or delivered to decrease Sellers to bring Sellers back to his numerical number of shares of Common Stock held at the exercise priceClosing. Solely for purpose of illustration, exchange price or conversion price if the Company completes a ten to one reverse split and Sellers held one thousand shares prior to the reverse, Sellers would be issued nine hundred shares to bring Sellers back to the one thousand share position. (e) The provisions and obligations set forth in this Section 4.06 shall survive the closing of such securitiesthis agreement for a period of twelve months.

Anti-dilution Adjustment. Other (a) In the event that prior to the one year anniversary of the Closing Date the Company shall complete one or more Subsequent Placements at an effective price per share less than the Purchase Price (such lower price, the “New Purchase Price” and such issuances collectively, a “Dilutive Issuance”), as adjusted hereunder (if the holder of the Equity Securities so issued shall at any time, whether by operation of purchase price adjustments, reset provisions, floating conversion, exercise or exchange prices or otherwise, or due to warrants, options or rights per share which is issued in connection with Excepted Issuances (as such term issuance, be entitled to receive shares of Common Stock at an effective price per share which is defined in less than the last sentence Purchase Price, such issuance shall be deemed to have occurred for less than the Purchase Price on such date of this Section 8(b)the Dilutive Issuance), if within twelve months following then the initial Closing of Purchase Price shall be deemed to be equal to the sale of Shares in the Offering, New Purchase Price and the Company shall issue to Investor without the consent receipt of the Majority Holders any Common Stock or securities convertible into or exercisable for additional consideration from Investor an additional number of shares of Common Stock equal to (i) such number of shares determined by dividing the aggregate Purchase Price paid by Investor by the New Purchase Price, less (ii) the number of Shares previously issued to Investor. Notwithstanding the foregoing, no adjustments shall be made, paid or modify issued under this Section 5.2 in respect of Exempt Issuances. (b) Notwithstanding anything to the conversion or exercise price of any contrary in Section 5.2(a), if the Company has not obtained Stockholder Approval (as defined below), then the Company may not issue as a result of the foregoing which may be outstanding) adjustment of the Purchase Price in connection with a Dilutive Issuance a number of shares of Common Stock, which, when aggregated with any shares of Common Stock issued in the Offering pursuant to any person or entity at a price per share which shall be less than 100the Subscription Agreements, would exceed 19.99% of the price per share number of shares of Common Stock outstanding on the Trading Day immediately preceding the Closing Date (such number of shares, the “Issuable Maximum”). If on any adjustment of the Shares purchased by such Subscriber (including any issuances of securities Purchase Price in connection with a Dilutive Issuance, the closing number of a registered primary offering shares of any securities Common Stock issuable to Investor would exceed the Issuable Maximum and the Company shall not have previously obtained the vote of stockholders to approve the issuance of shares of Common Stock in excess of the Company in any jurisdiction), subject to adjustment for stock dividends, subdivisions and combinations Issuable Maximum (the “Lower Price IssuanceStockholder Approval”), then the Company shall issue, for each issue to Investor such occasion, additional shares of Common Stock to the Subscriber respecting the Purchased Securities that are then still owned by the Subscriber at the time of the Lower Price Issuance so that the average per share purchase price of the Purchased Securities owned by the Subscriber on the date of the Lower Price Issuance plus such additional shares issued to Subscriber pursuant to this Section 8(b) is equal to such other lower price per share. The delivery to Subscriber of the additional shares of Common Stock shall be not later than the 5 Business Days after the closing date of the transaction giving rise to the requirement to issue additional shares of Common Stock. For purposes of the issuance and adjustment described in this Section 8(b), in the case of the issuance of securities convertible into or exercisable for shares of Common Stock, the price per share shall be deemed to be the quotient obtained by dividing (i) the sum of (A) the price paid for such derivative security plus (B) the aggregate amount of consideration to be paid upon conversion or exercise price of such security for the maximum number of shares for which the derivative security may be converted or exercised, by (ii) the total number of shares of common stock issuable upon conversion or exercise price of such security for the maximum number of shares for which the derivative security may be converted or exercised. The adjustment described in this Section 8(b) shall be made immediately upon the earlier of (x) the issuance of the derivative security or (y) the Company entering into an agreement to issue the derivative security, in each case at a price lower than the price per Share in the Offering (which price is subject to adjustment for stock dividends, subdivisions and combinations), but such adjustment shall not be made again upon any issuance of shares of Common Stock upon conversion equal to such Investor’s pro-portion of such derivative security. Any the Issuable Maximum and, with respect to the remainder of the aggregate number of shares of Common Stock or derivative security issued or issuable by upon the Company for no consideration or for consideration that cannot be determined at adjustment of the time of issuance will be deemed issuable or to have been issued for $0.01 per share of Common Stock. The rights of Subscriber set forth in this Section 8 are in addition to any other rights the Subscriber has pursuant to this Agreement, any Transaction Documents, and any other agreement referred to or entered into in connection herewith or to which Subscriber and Company are parties. For purposes hereof, “Excepted Issuances” means the (i) Company’s issuances of securities comprising the full or partial consideration Purchase Price in connection with a strategic mergerDilutive Issuance, acquisition, consolidation or purchase the Company shall be prohibited from issuing such shares of substantially all of the securities or assets of a corporation or other entity that Common Stock until and unless Stockholder Approval has been approved by a majority of disinterested directors of the Company and in which holders of such securities or debt are not at any time granted registration rights, (ii) the Company’s issuance of securities in connection with strategic license agreements and other partnering arrangements so long as such issuances are not for the purpose of raising capital and which holders of such securities or debt are not at any time granted registration rights, (iii) the Company’s issuance of common stock or its issuances or grants of options to purchase common stock to employees, directors, and officers of the Company pursuant to any stock or option plan duly adopted for such purpose, by a majority of the non-employee members of the Board of Directors or a majority of the members of a committee of non-employee directors established for such purpose, and (iv) the Company’s issuances of securities upon the exercise or exchange of or conversion of any securities exercisable or exchangeable for or convertible into shares of common stock issued and outstanding on the date of this Agreement, provided that such securities have not been amended since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securitiesobtained.

Anti-dilution Adjustment. Other than in connection with Excepted Issuances In the event that the Corporation shall at any time or from time to time, after the issuance of shares of Series E Preferred Stock but prior to the Conversion, (as such term is defined in w) make a dividend or distribution on the last sentence of this Section 8(b)), if within twelve months following the initial Closing of the sale of Shares in the Offering, the Company shall issue without the consent of the Majority Holders any Common Stock or securities convertible into or exercisable for outstanding shares of Common Stock payable in Capital Stock, (or modify x) subdivide the conversion or exercise price of any of the foregoing which may be outstanding) to any person or entity at a price per share which shall be less than 100% of the price per share of the Shares purchased by such Subscriber (including any issuances of securities in connection with the closing of a registered primary offering of any securities of the Company in any jurisdiction), subject to adjustment for stock dividends, subdivisions and combinations (the “Lower Price Issuance”), then the Company shall issue, for each such occasion, additional outstanding shares of Common Stock to into a larger number of shares, (y) combine the Subscriber respecting the Purchased Securities that are then still owned by the Subscriber at the time of the Lower Price Issuance so that the average per share purchase price of the Purchased Securities owned by the Subscriber on the date of the Lower Price Issuance plus such additional shares issued to Subscriber pursuant to this Section 8(b) is equal to such other lower price per share. The delivery to Subscriber of the additional outstanding shares of Common Stock shall be not later than the 5 Business Days after the closing date into a smaller number of shares or (z) issue any shares of its Capital Stock in a reclassification of the transaction giving rise to Common Stock (an “Event”), then, and in each such case, (I) the requirement to issue additional aggregate number of shares of Common Stock. For Stock which the holder would be entitled to receive upon the Conversion, (II) the number of shares of Common Stock deemed held for each share of Series E Preferred Stock for purposes of Section 2 and (III) the issuance number of votes per share of Series E Preferred Stock for purposes of Section 3 shall be adjusted (and adjustment described in this Section 8(b), in any other appropriate actions shall be taken by the case Corporation) so that such holder of Series E Preferred Stock shall be entitled to (X) receive upon Conversion the issuance appropriate number of securities convertible into or exercisable for shares of Common Stock, the price per share shall be deemed to be the quotient obtained by dividing (iY) the sum of (A) the price paid for such derivative security plus (B) the aggregate amount of consideration to be paid upon conversion or exercise price of such security for the maximum appropriate number of shares for which the derivative security may be converted or exercised, by (ii) the total number of shares of common stock issuable upon conversion or exercise price of such security for the maximum number of shares for which the derivative security may be converted or exercised. The adjustment described in this Section 8(b) shall be made immediately upon the earlier of (x) the issuance of the derivative security or (y) the Company entering into an agreement to issue the derivative security, in each case at a price lower than the price per Share in the Offering (which price is subject to adjustment for stock dividends, subdivisions and combinations), but such adjustment shall not be made again upon any issuance of shares of Common Stock upon conversion deemed held for purposes of such derivative security. Any Common Stock or derivative security issued or issuable by Section 2 consistent with the Company for no consideration or for consideration that cannot be determined at determination made in clause (I), and (Z) the time appropriate number of issuance will be deemed issuable or to have been issued for $0.01 votes per share of Common StockSeries E Preferred Stock for purposes of Section 3 consistent with the determination made in clause (I), which in each case shall reflect the occurrence of the Event. The rights of Subscriber set forth in this Section 8 are in addition to any other rights the Subscriber has An adjustment made pursuant to this AgreementSection 9 shall become effective retroactively (x) in the case of any such dividend or distribution, any Transaction Documents, and any other agreement referred to or entered into in connection herewith or to which Subscriber and Company are parties. For purposes hereof, “Excepted Issuances” means a date immediately following the (i) Company’s issuances close of securities comprising business on the full or partial consideration in connection with a strategic merger, acquisition, consolidation or purchase record date for the determination of substantially all of the securities or assets of a corporation or other entity that has been approved by a majority of disinterested directors of the Company and in which holders of shares of Common Stock entitled to receive such securities dividend or debt are not at any time granted registration rights, distribution or (iiy) in the Company’s issuance of securities in connection with strategic license agreements and other partnering arrangements so long as such issuances are not for the purpose of raising capital and which holders of such securities or debt are not at any time granted registration rights, (iii) the Company’s issuance of common stock or its issuances or grants of options to purchase common stock to employees, directors, and officers of the Company pursuant to any stock or option plan duly adopted for such purpose, by a majority of the non-employee members of the Board of Directors or a majority of the members of a committee of non-employee directors established for such purpose, and (iv) the Company’s issuances of securities upon the exercise or exchange of or conversion case of any securities exercisable such subdivision, combination or exchangeable for or convertible into shares reclassification, to the close of common stock issued and outstanding business on the date of this Agreement, provided that day upon which such securities have not been amended since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securitiescorporate action becomes effective.

Anti-dilution Adjustment. Other than in connection with Excepted Issuances As to each Purchaser, during the one hundred eighty (as such term is defined in the last sentence of this Section 8(b)), if within twelve months 180) days following the initial Closing Date, if the Company makes any issuance, sale, grant of any option or right to purchase or other disposition of any equity security or any equity-linked or related security (including, without limitation, any “equity security” as that term is defined under Rule 405 promulgated under the sale of Shares in Securities Act, any securities convertible into such equity securities, any preferred stock or any purchase rights) that is not an Excluded Security (as defined below), for a consideration per share that is less than the OfferingPurchase Price (adjusted for stock splits, combinations, dividends and the like occurring after the date hereof) (such lesser price is referred to herein as the “Discounted Purchase Price”) (the foregoing, a “Dilutive Issuance”), then reasonably promptly after such Dilutive Issuance, the Company shall issue to such Purchaser solely with respect to the Shares acquired pursuant to this Agreement, without the consent payment of additional consideration, a number of additional shares of Common Stock (the “Additional Shares”) equal to the result of subtracting (B) from (A), where (A) is the number of shares of Common Stock the Purchaser would have received for its total Subscription Amount for Held Shares if the Purchaser had paid in respect of its Held Shares the Discounted Purchase Price instead of the Majority Holders Purchase Price (adjusted for stock splits, combinations, dividends and the like occurring after the Closing Date), and (B) is the number of Held Shares initially issued to the Purchaser at the Closing (adjusted for stock splits, combinations, dividends and the like occurring after the Closing Date), in each case where “Held Shares” shall refer to the number of Shares initially purchased by such Purchaser at a Closing hereunder and still held of record and beneficially by such Purchaser at the time of such Dilutive Issuance. Upon any issuance of Additional Shares hereunder, such Additional Shares shall be included as Registrable Securities (as defined in the Registration Rights Agreement). “Excluded Securities” include: (a) shares of Common Stock issued upon exercise or conversion of any exercisable or convertible securities outstanding as of the date hereof; (b) shares of Common Stock or securities convertible into Common Stock issued to employees, officers or exercisable for directors of, or consultants or advisors to the Company or any subsidiary pursuant to stock purchase agreements, stock option plans or other arrangements that are approved by the Company’s board of directors; (c) shares of Common Stock (or modify the conversion or exercise price of any of the foregoing which may be outstanding) to any person or entity at a price per share which shall be less than 100% of the price per share of the Shares purchased by such Subscriber (including any issuances of securities convertible into Common Stock issued in connection with the closing of a registered primary offering of any securities of acquisitions, asset purchases, licenses, collaborations or strategic transactions involving the Company in any jurisdiction), subject to adjustment for stock dividends, subdivisions and combinations other entities approved by the Company’s board of directors; and (the “Lower Price Issuance”), then the Company shall issue, for each such occasion, additional d) shares of Common Stock to the Subscriber respecting the Purchased Securities that are then still owned by the Subscriber at the time of the Lower Price Issuance so that the average per share purchase price of the Purchased Securities owned by the Subscriber on the date of the Lower Price Issuance plus such additional shares issued to Subscriber pursuant to this Section 8(b) is equal to such other lower price per share. The delivery to Subscriber of the additional shares of or securities convertible or exercisable into Common Stock shall be not later than the 5 Business Days after the closing date of the transaction giving rise to the requirement to issue additional shares of Common Stock. For purposes of the issuance and adjustment described in this Section 8(b), in the case of the issuance of securities convertible into or exercisable for shares of Common Stock, the price per share that shall be deemed in writing to be the quotient obtained Excluded Securities either by dividing (i) the sum of (A) the price paid for such derivative security plus (B) the aggregate amount of consideration to be paid upon conversion or exercise price of such security for the maximum number of shares for which the derivative security may be converted or exercised, by (ii) the total number of shares of common stock issuable upon conversion or exercise price of such security for the maximum number of shares for which the derivative security may be converted or exercised. The adjustment described in this Section 8(b) shall be made immediately upon the earlier of (x) the issuance of the derivative security or (y) the Company entering into an agreement to issue the derivative security, in each case at a price lower than the price per Share in the Offering (which price is subject to adjustment for stock dividends, subdivisions and combinations), but such adjustment shall not be made again upon any issuance of shares of Common Stock upon conversion of such derivative security. Any Common Stock or derivative security issued or issuable by the Company for no consideration or for consideration that cannot be determined at the time of issuance will be deemed issuable or to have been issued for $0.01 per share of Common Stock. The rights of Subscriber set forth in this Section 8 are in addition to any other rights the Subscriber has pursuant to this Agreement, any Transaction Documents, and any other agreement referred to or entered into in connection herewith or to which Subscriber and Company are parties. For purposes hereof, “Excepted Issuances” means the (i) Company’s issuances of securities comprising the full or partial consideration in connection with a strategic merger, acquisition, consolidation or purchase of substantially all of the securities or assets of a corporation or other entity that has been approved by a majority of disinterested directors of the Company and in which holders of such securities or debt are not at any time granted registration rights, (ii) the Company’s issuance of securities in connection with strategic license agreements and other partnering arrangements so long as such issuances are not for the purpose of raising capital and which holders of such securities or debt are not at any time granted registration rights, (iii) the Company’s issuance of common stock or its issuances or grants of options to purchase common stock to employees, directors, and officers of the Company pursuant to any stock or option plan duly adopted for such purpose, by a majority of the non-employee members then Held Shares or (ii) a representative of the Board of Directors or a majority holders of the members of a committee of non-employee directors established for such purposethen Held Shares, and which representative shall be appointed by the three (iv3) Purchasers who then hold the Company’s issuances of securities upon the exercise or exchange of or conversion of any securities exercisable or exchangeable for or convertible into shares of common stock issued and outstanding on the date of this Agreement, provided that such securities have not been amended since the date of this Agreement to increase the largest number of such securities or to decrease the exercise price, exchange price or conversion price of such securitiesHeld Shares.

Anti-dilution Adjustment. Other than in connection with Excepted Issuances (as such term is defined in The shares of Common Stock purchased hereunder, but not including the last sentence shares of this Section 8(b)), if within twelve months following the initial Closing Common Stock issuable upon exercise of the sale of Shares Warrants (the "ADJUSTED SHARES") shall be subject to adjustment from time-to-time in accordance with the Offeringfollowing. If at any time within one (1) year and six (6) months after the Closing, the Company shall issue without the consent do any of the Majority following, and immediately upon the occurrence of the following: (a) Issue any options, warrants or other rights entitling the Holder thereof to subscribe for or purchase shares of Common Stock or other securities of the Company convertible or exchangeable for Common Stock at a price per share which, when added to the amount of consideration received or receivable by the Company for such options, warrants or rights is less than $3.00 per share or, at any time following the first adjustment made pursuant to this Section 8, the then effective purchase price per share paid by the Investors hereunder (the "THRESHOLD PRICE"); (b) Issue or sell securities of the Company convertible into or exchangeable for Common Stock at a price per share which, when added to the amount of consideration received or receivable by the Company for such exchangeable or convertible securities, is less than the Threshold Price; or (c) Issue or sell additional shares of its Common Stock for consideration less than the Threshold Price; then the Company shall promptly issue to the Holders any of Adjusted Shares that number of shares of Common Stock that, when added to the number of shares of Common Stock previously issued to the Holders of Adjusted Shares, equals in the aggregate that number of shares of Common Stock that would have been purchased with the Required Payment if the Investors had initially paid a price per share equal to the price paid for the additional shares of Common Stock issued or deemed issued pursuant to this Section 8. The price paid for additional shares of Common Stock issued or deemed issued pursuant to this Section 8 shall be equal to, (i) if shares of Common Stock are sold, the price per share paid for such Common Stock; and (ii) if options, warrants or other rights to purchase Common Stock or securities convertible into or exercisable exchangeable for Common Stock are issued or sold, the lowest price per share payable upon exercise, conversion or exchange of such securities, plus the price per share paid for such options, warrants or other rights or convertible securities. For example, if, prior to the one (1) year six (6) month anniversary of the Closing, the Company were to sell 1,000,000 additional shares of Common Stock (or modify the conversion or exercise price of any of the foregoing which may be outstanding) to any person or entity at a price per share which shall be less than 100% of the price per share of the Shares purchased by such Subscriber (including any issuances of securities in connection with the closing of $2.00 a registered primary offering of any securities of share, the Company in any jurisdiction), subject would be required to adjustment for stock dividends, subdivisions and combinations (the “Lower Price Issuance”), then the Company shall issue, for each such occasion, issue additional shares of Common Stock to the Subscriber respecting the Purchased Securities that are then still owned by the Subscriber at the time of the Lower Price Issuance so Investors determined as follows, assuming that the average Investors made an aggregate Required Payment of $5,000,000: Required Payment ($5,000,000), DIVIDED BY new price per share purchase price ($2.00), EQUALS 2,500,000 shares, minus 1,666,667 shares previously issued, equals 83,000 shares of the Purchased Securities owned by the Subscriber on the date of the Lower Price Issuance plus such additional Common Stock. Such additional shares would be issued to Subscriber pro rata among the Investors at no additional cost. Upon any adjustment pursuant to this Section 8(b) is equal to such other lower price per share. The delivery to Subscriber of 8, the additional shares of Common Stock Company shall be not later than the 5 Business Days after the closing date of the transaction giving rise give written notice thereof, by first class mail, postage prepaid, return receipt requested addressed to the requirement to issue additional shares registered Holder of Common Stock. For purposes of Adjusted Shares at the issuance and adjustment described in this Section 8(b), in the case of the issuance of securities convertible into or exercisable for shares of Common Stock, the price per share shall be deemed to be the quotient obtained by dividing (i) the sum of (A) the price paid for such derivative security plus (B) the aggregate amount of consideration to be paid upon conversion or exercise price address of such security for Holder as shown on the maximum number of shares for which the derivative security may be converted or exercised, by (ii) the total number of shares of common stock issuable upon conversion or exercise price of such security for the maximum number of shares for which the derivative security may be converted or exercised. The adjustment described in this Section 8(b) shall be made immediately upon the earlier of (x) the issuance of the derivative security or (y) the Company entering into an agreement to issue the derivative security, in each case at a price lower than the price per Share in the Offering (which price is subject to adjustment for stock dividends, subdivisions and combinations), but such adjustment shall not be made again upon any issuance of shares of Common Stock upon conversion of such derivative security. Any Common Stock or derivative security issued or issuable by the Company for no consideration or for consideration that cannot be determined at the time of issuance will be deemed issuable or to have been issued for $0.01 per share of Common Stock. The rights of Subscriber set forth in this Section 8 are in addition to any other rights the Subscriber has pursuant to this Agreement, any Transaction Documents, and any other agreement referred to or entered into in connection herewith or to which Subscriber and Company are parties. For purposes hereof, “Excepted Issuances” means the (i) Company’s issuances of securities comprising the full or partial consideration in connection with a strategic merger, acquisition, consolidation or purchase of substantially all of the securities or assets of a corporation or other entity that has been approved by a majority of disinterested directors books of the Company and in which holders case of a Holder with an address of record outside the United States, by facsimile, and confirmed in writing by first class air mail. The notice shall be signed by the Company's chief financial officer and shall state the nature of such securities or debt are adjustment, setting forth in reasonable detail the method of effecting the adjustment and the facts upon which such adjustment is based. Notwithstanding the above, this Section 8 shall not at apply to the following: (i) exercise of any time granted registration rights, of the 2,595,000 options issued and outstanding as of the date hereof as reflected on ANNEX 5.1 hereto; (ii) the Company’s issuance to directors, officers or independent consultants of securities in connection with strategic license agreements and other partnering arrangements so long the Company as such issuances are not for the purpose of raising capital and which holders of such securities or debt are not at any time granted registration rights, (iii) the Company’s issuance of common stock or its issuances or grants incentive compensation of options to purchase common stock to employees, directors, and officers shares of the Company Common Stock pursuant to any stock or an option plan duly adopted for such purpose, by a majority of the non-employee members of the Company's Board of Directors or and stockholders subject to a majority limit of options to purchase 3,000,000 shares of Common Stock; and (iii) any issuance of securities approved by Investors holding 66_% of the members of a committee of non-employee directors established for such purpose, and (iv) the Company’s issuances of securities upon the exercise or exchange of or conversion of any securities exercisable or exchangeable for or convertible into shares of common stock Common Stock issued hereunder and outstanding on the date of this Agreement, provided that such securities have not been amended since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securitiesthen held by Investors.

Anti-dilution Adjustment. Other than in connection with Excepted Issuances (as such term is defined in If and whenever after the last sentence of this Section 8(b)), if within twelve months following the initial Closing of the sale of Shares in the Offeringdate hereof, the Company Issuer shall issue without the consent or sell any shares of the Majority Holders any its Common Stock or securities convertible into or exercisable for shares of Common Stock (or modify the conversion or exercise price of any of the foregoing which may be outstanding) to any person or entity at a price consideration per share which shall be less than 100% of the price per share of the Shares purchased by such Subscriber (including any issuances of securities Exchange Price in connection with the closing of a registered primary offering of any securities of the Company in any jurisdiction), subject effect immediately prior to adjustment for stock dividends, subdivisions and combinations (the “Lower Price Issuance”), then the Company shall issue, for each such occasion, additional shares of Common Stock to the Subscriber respecting the Purchased Securities that are then still owned by the Subscriber at the time of issue or sale, then forthwith the Lower Exchange Price Issuance so that the average per share purchase price of the Purchased Securities owned by the Subscriber on the date of the Lower Price Issuance plus such additional shares issued to Subscriber pursuant to this Section 8(b) is equal to such other lower price per share. The delivery to Subscriber of the additional shares of Common Stock shall be not later than the 5 Business Days after the closing date of the transaction giving rise reduced to the requirement prices (calculated to issue additional shares the nearest tenth of Common Stock. For purposes of the issuance and adjustment described in this Section 8(b), in the case of the issuance of securities convertible into or exercisable for shares of Common Stock, the price per share shall be deemed to be the quotient obtained a cent) determined by dividing (i1) an amount equal to the sum of (Aaa) the price paid for such derivative security plus (B) the aggregate amount of consideration to be paid upon conversion or exercise price of such security for the maximum number of shares for which of the derivative security may be converted Issuer's Common Stock outstanding immediately prior to such issue or exercisedsale (assuming the exchange of all securities convertible into shares of the Issuer's Common Stock) multiplied by the Exchange Price in effect immediately prior to such issue or sale, and (bb) the consideration, if any, received and deemed received by the Issuer upon such issue or sale, by (ii2) the total number of shares of common stock issuable upon conversion the Issuer's Common Stock outstanding and deemed outstanding immediately after such issue or exercise price sale. If, and to the extent that, on any date, the holding by the Holder of such security for this Revised Note would result in the maximum number Holder's being deemed the beneficial owner of shares for which the derivative security may be converted or exercised. The adjustment described in this Section 8(b) shall be made immediately upon the earlier of (x) the issuance more than 4.99% of the derivative security or (y) the Company entering into an agreement to issue the derivative security, in each case at a price lower than the price per Share in the Offering (which price is subject to adjustment for stock dividends, subdivisions then Issued and combinations), but such adjustment shall not be made again upon any issuance Outstanding number of shares of Common Stock upon conversion of the Issuer, then the Holder shall not have the right, and the Issuer shall not have the obligation, to Exchange any portion of this Revised Note as shall cause such Holder to be deemed the beneficial owner of more than 4.99% of the then Issued and Outstanding number of shares of Common Stock of the Issuer. If any court of competent jurisdiction shall determine that the foregoing limitation is ineffective to prevent a Holder from being deemed the beneficial owner of more than 4.99% of the then Issued and Outstanding number of shares of Common Stock of the Issuer, then the Issuer shall prepay in cash such portion of this Revised Note as shall cause such Holder not to be deemed the beneficial owner of more than 4.99% of the then Issued and Outstanding number of shares of Common Stock of the Issuer. Upon such determination by a court of competent jurisdiction, the Holder shall have no interest in or rights under such portion of the Revised Note. Any and all interest paid on or prior to the date of such derivative security. Any Common Stock or derivative security issued or issuable determination shall be deemed interest paid on the remaining portion of this Revised Note held by the Company Holder. Such prepayment shall be for no consideration or cash at a prepayment price of one hundred and fifty percent (150%) of the Principal Amount thereof, together with all accrued and unpaid interest thereon to the date of prepayment. TIME OF ESSENCE Time is of the essence for consideration that cannot be determined at the time performance of issuance will be deemed issuable or to have been issued for $0.01 per share of Common Stock. The rights of Subscriber all obligations set forth in this Section 8 are in addition to any other rights the Subscriber has pursuant to this Agreement, any Transaction Documents, and any other agreement referred to or entered into in connection herewith or to which Subscriber and Company are parties. For purposes hereof, “Excepted Issuances” means the (i) Company’s issuances of securities comprising the full or partial consideration in connection with a strategic merger, acquisition, consolidation or purchase of substantially all of the securities or assets of a corporation or other entity that has been approved by a majority of disinterested directors of the Company and in which holders of such securities or debt are not at any time granted registration rights, (ii) the Company’s issuance of securities in connection with strategic license agreements and other partnering arrangements so long as such issuances are not for the purpose of raising capital and which holders of such securities or debt are not at any time granted registration rights, (iii) the Company’s issuance of common stock or its issuances or grants of options to purchase common stock to employees, directors, and officers of the Company pursuant to any stock or option plan duly adopted for such purpose, by a majority of the non-employee members of the Board of Directors or a majority of the members of a committee of non-employee directors established for such purpose, and (iv) the Company’s issuances of securities upon the exercise or exchange of or conversion of any securities exercisable or exchangeable for or convertible into shares of common stock issued and outstanding on the date of this Agreement, provided that such securities have not been amended since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securitiesRevised Note.

Anti-dilution Adjustment. Other than in connection with Excepted Issuances (as such term is defined If, subsequent to the date hereof and ------------------------- prior to the Learning Curve Effective Time, RCE shall change or declare a change in the last sentence number of this Section 8(b)), if within twelve months following the initial Closing of the sale of RCE Shares in the Offering, the Company shall issue without the consent of the Majority Holders any Common Stock or securities convertible or exchangeable into or exercisable for shares of Common Stock (or modify RCE Shares, issued and outstanding prior to the conversion or exercise price of any of the foregoing which may be outstanding) to any person or entity at Learning Curve Effective Time as a price per share which shall be less than 100% of the price per share of the Shares purchased by such Subscriber (including any issuances of securities in connection with the closing result of a registered primary offering of any securities of the Company in any jurisdiction)reclassification, subject to adjustment for stock dividendssplit, subdivisions and combinations (the “Lower Price Issuance”)stock dividend or distribution, recapitalization, merger, subdivision, issuer tender or exchange offer or other similar transaction, then the Company shall issue, for in each such occasioncase, additional shares of Common Stock to the Subscriber respecting the Purchased Securities that are then still owned by the Subscriber at the time of the Lower Price Issuance so that the average per share purchase price of the Purchased Securities owned by the Subscriber on the date of the Lower Price Issuance plus such additional shares issued to Subscriber pursuant to this Section 8(b) is equal to such other lower price per share. The delivery to Subscriber of the additional shares of Common Stock shall be not later than the 5 Business Days from and after the closing record date of for determining the transaction giving rise stockholders entitled to the requirement to issue additional shares of Common Stock. For purposes of the issuance and receive such RCE Shares or other securities, an appropriate adjustment described in this Section 8(b), in the case of the issuance of securities convertible into or exercisable for shares of Common Stock, the price per share shall be deemed to be the quotient obtained by dividing (i) the sum of (A) the price paid for such derivative security plus (B) the aggregate amount of consideration to be paid upon conversion or exercise price of such security for the maximum number of shares for which the derivative security may be converted or exercised, by (ii) the total number of shares of common stock issuable upon conversion or exercise price of such security for the maximum number of shares for which the derivative security may be converted or exercised. The adjustment described in this Section 8(bif any) shall be made immediately upon to the earlier of (x) the issuance of the derivative security or (y) the Company entering into an agreement to issue the derivative security, in each case at a price lower than the price per Share in the Offering (which price is subject to adjustment for stock dividends, subdivisions and combinations), but such adjustment shall not be made again upon any issuance of shares of Common Stock upon conversion of such derivative security. Any Common Stock or derivative security issued or issuable by the Company for no consideration or for consideration that cannot be determined at the time of issuance will be deemed issuable or to have been issued for $0.01 per share of Common Stock. The rights of Subscriber formula set forth in this Section 8 are in addition section 2.4(e)(iii)[a] above, for purposes of determining the number of Merger Shares into which the Learning Curve Class C Common Shares shall be converted to any other rights the Subscriber has pursuant extent necessary to this Agreement, any Transaction Documents, and any other agreement referred to or entered into in connection herewith or to which Subscriber and Company are partiespreserve the proportional interest of the Merger Shares. For purposes hereof, “Excepted Issuances” means the (i) Company’s issuances of securities comprising the full or partial consideration in connection with a strategic merger, acquisition, consolidation or purchase of substantially all of the securities or assets payment of a corporation dividend in RCE Shares, or the distribution on RCE Shares in securities convertible into RCE Shares, shall be deemed to have effected an increase in the number of outstanding RCE Shares equal to the number of RCE Shares into which such securities shall be initially convertible without the payment by the holder thereof of any consideration other entity that has been approved by a majority of disinterested directors of than the Company and in which holders surrender for cancellation of such securities or debt are convertible securities. Notwithstanding the foregoing, this section shall not at any time granted registration rights, (ii) the Company’s issuance of securities in connection with strategic license agreements and other partnering arrangements so long as such issuances are not for the purpose of raising capital and which holders of such securities or debt are not at any time granted registration rights, (iii) the Company’s issuance of common stock or its issuances or grants of options to purchase common stock to employees, directors, and officers of the Company pursuant apply to any stock or options issued under option plan duly adopted for such purpose, by a majority plans of the non-employee members RCE existing as of the Board of Directors or a majority of the members of a committee of non-employee directors established for such purpose, and (iv) the Company’s issuances of securities upon the exercise or exchange of or conversion of any securities exercisable or exchangeable for or convertible into shares of common stock issued and outstanding on the date of this Agreement, provided that such securities have not been amended since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securities.

Anti-dilution Adjustment. Other than in connection with Excepted Issuances (a) In the event that prior to the first anniversary of the Effective Date Deadline, as such term is defined in the last sentence of this Section 8(b))Registration Rights Agreement, if within twelve months following the initial Closing of the sale of Shares in the Offeringdated August 21, 2006, the Company shall issue without the consent of the Majority Holders any issues or is deemed to have issued additional Common Stock or securities convertible into or exercisable for shares of Common Stock (or modify the conversion or exercise Shares at a purchase price of any of the foregoing which may be outstanding) to any person or entity at a price less than $0.30 per share which shall be less than 100% of the price per share of the Shares purchased by such Subscriber (including any issuances of securities in connection with the closing of a registered primary offering of any securities of the Company in any jurisdiction), subject to adjustment for stock dividends, subdivisions and combinations (the “Lower Price IssuanceDiluting Event”), then the Company shall issue, for each will within ten (10) days after such occasion, additional shares of Common Stock issuance or deemed issuance issue to the Subscriber respecting Purchaser, without any further consideration of any kind being required to be paid by any person to the Purchased Securities Company, such a number of additional Common Shares that are then still owned by will be necessary to maintain the Subscriber Purchaser’s ownership percentage of the outstanding Common Shares at the time same level (calculated to one-hundredth of the Lower Price Issuance so that the average per share purchase price of the Purchased Securities owned by the Subscriber on the date of the Lower Price Issuance plus such additional shares issued to Subscriber pursuant to this Section 8(bone percent) is equal to such other lower price per share. The delivery to Subscriber of the additional shares of Common Stock shall be not later than the 5 Business Days after the closing date of the transaction giving rise as immediately prior to the requirement to issue additional shares of Common StockDiluting Event. For purposes of the issuance and adjustment described in this Section 8(b)preceding sentence, in the case of the issuance of securities convertible into or exercisable for shares of Common Stock, the price per share Shares shall be deemed to have been issued immediately upon the issuance by the Company or any affiliate of the Company of securities exercisable or exchangeable for, or convertible into, Common Shares (“Convertible Securities”) and the purchase price for such Common Shares shall be the quotient obtained sum of the consideration per share paid by dividing the acquirer for such Convertible Securities plus the additional consideration per share, if any, payable by the holder of such Convertible Securities to acquire the Common Shares upon exercise, exchange or conversion of such Convertible Securities. (b) There shall be no adjustment for issuance of any of the following: (i) the sum of (A) the price paid for such derivative security plus (B) the aggregate amount of consideration up to be paid upon conversion or exercise price of such security for the maximum number of 2,500,000 shares for which the derivative security may be converted or exercised, by issued under any Company’s Employee Stock Option Plan; (ii) the total number of shares of common stock issuable upon conversion or exercise price of such security for the maximum number of shares for which the derivative security may be converted or exercised. The adjustment described in this Section 8(b) shall be made immediately upon the earlier of (x) the issuance of the derivative security or (y) the Company entering into an agreement to issue the derivative security, in each case at a price lower than the price per Share in the Offering (which price is subject to adjustment for stock dividends, subdivisions and combinations), but such adjustment shall not be made again upon any issuance of shares of Common Stock upon conversion of such derivative security. Any Common Stock or derivative security issued or issuable by the Company for no consideration or for consideration that cannot be determined at the time of issuance will be deemed issuable or to have been issued for $0.01 per share of Common Stock. The rights of Subscriber set forth in this Section 8 are in addition to any other rights the Subscriber has than cash pursuant to this Agreementa merger, any Transaction Documents, and any other agreement referred to or entered into in connection herewith or to which Subscriber and Company are parties. For purposes hereof, “Excepted Issuances” means the (i) Company’s issuances of securities comprising the full or partial consideration in connection with a strategic mergerconsolidation, acquisition, consolidation or purchase of substantially all of the securities or assets of a corporation or other entity that has been similar business combination approved by a majority of disinterested directors of the Company and in which holders of such securities or debt are not at any time granted registration rights, (ii) the Company’s issuance of securities in connection with strategic license agreements and other partnering arrangements so long as such issuances are not for the purpose of raising capital and which holders of such securities or debt are not at any time granted registration rights, Board; (iii) shares issued pursuant to any equipment loan or leasing arrangement, real property leasing arrangement or debt financing from a bank or similar financial institution approved by the Company’s issuance Board; (iv) the exercise of common stock or its issuances or grants of options any Warrant outstanding on the date hereof; (v) up to purchase common stock 600,000 shares issued to employees, directors, and officers consultants of the Company pursuant to any stock or option plan duly adopted for such purpose, by a majority of the non-employee members of the Board of Directors of the Company or a majority of the members of a committee of non-employee directors established for such purpose, ; and (ivvi) shares issued with the Company’s issuances prior written consent of securities upon the exercise or exchange majority of or conversion of any securities exercisable or exchangeable for or convertible into shares of common stock issued and outstanding on the date of this Agreement, provided that such securities have not been amended since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securitiesPurchasers.

Anti-dilution Adjustment. Other than in connection with Excepted Issuances (as such term is defined in 2.1 Subject to Sections 2.2 and 2.3, if, during the last sentence of this Section 8(b)), if within twelve months two-year period immediately following the initial Closing of the sale of Shares in the OfferingClosing, the Company shall issue without any shares of Common Stock, or any securities convertible into, or exercisable for, shares of Common Stock, at a consideration per share that is less than $1.20 per share (as adjusted for stock splits, stock dividends, and the consent like) (the "TRIGGER PRICE") (each, a "NEW ISSUANCE"), then promptly following such New Issuance the Company shall issue to FHCP such number of additional shares (the "ADDITIONAL SHARES") determined by multiplying the number of Retained Shares held by FHCP at the time of the Majority Holders any New Issuance by the number obtained using the formula set forth below, and subtracting from the product so obtained the number of Retained Shares held by FHCP at the time of the New Issuance: Y / ((AxY) + B / C) where Y = the then existing Trigger Price A = the number of shares of Common Stock outstanding immediately prior to the New Issuance B = the consideration, if any, received by the Company upon the New Issuance C = the total number of shares of Common Stock outstanding immediately after such issue or sale. 2.2 A New Issuance shall not include (and Additional Shares shall not be issued as a result of) any of the following: (a) any securities convertible into issued pursuant to or exercisable for as a result of any stock dividend, stock split, or the like; (b) the issuance of any shares of Common Stock (directly or modify the indirectly) upon exercise, conversion or exercise price exchange of any of option, warrant, convertible security or other right outstanding on the foregoing which may be outstanding) to any person or entity at a price per share which shall be less than 100% of the price per share of the Shares purchased by such Subscriber date hereof (including any issuances of securities those issued in connection with or contemplated by the closing Shares Exchange Agreement); (c) Common Stock issued in any one transaction or series of related transactions having for consideration per share less than the then Trigger Price, if the aggregate proceeds from such issuances does not exceed $100,000 per annum; or (d) the issuance of securities to FHCP or it Affiliates. 2.3 For purposes of determining the consideration per share received in connection with a registered primary offering of any securities New Issuance, the following shall apply: (a) in the case of the Company in any jurisdiction), subject to adjustment for stock dividends, subdivisions and combinations (the “Lower Price Issuance”), then the Company shall issue, for each such occasion, additional issuance of shares of Common Stock to for cash, the Subscriber respecting consideration shall be the Purchased Securities that are then still owned by amount of such cash; (b) in the Subscriber at the time case of the Lower Price Issuance so that the average per share purchase price issuance of the Purchased Securities owned by the Subscriber on the date of the Lower Price Issuance plus such additional shares issued to Subscriber pursuant to this Section 8(b) is equal to such other lower price per share. The delivery to Subscriber of the additional shares of Common Stock for a consideration in whole or in part other than cash, the consideration other than cash shall be not later than deemed to be the 5 Business Days after fair market value thereof as determined in good faith by the closing date Independent Directors (irrespective of the transaction giving rise to the requirement to issue additional shares of Common Stock. For purposes of the issuance and adjustment described in this Section 8(baccounting treatment thereof), whose determination shall be conclusive; and (c) in the case of the issuance of securities convertible into or exercisable for shares of Common Stock, the price per share aggregate consideration received therefor shall be deemed to be the quotient obtained by dividing (i) the sum of (A) the price paid for such derivative security plus (B) the aggregate amount of consideration to be paid upon conversion or exercise price of such security for the maximum number of shares for which the derivative security may be converted or exercised, by (ii) the total number of shares of common stock issuable upon conversion or exercise price of such security for the maximum number of shares for which the derivative security may be converted or exercised. The adjustment described in this Section 8(b) shall be made immediately upon the earlier of (x) the issuance of the derivative security or (y) the Company entering into an agreement to issue the derivative security, in each case at a price lower than the price per Share in the Offering (which price is subject to adjustment for stock dividends, subdivisions and combinations), but such adjustment shall not be made again upon any issuance of shares of Common Stock upon conversion of such derivative security. Any Common Stock or derivative security issued or issuable received by the Company for no consideration or for consideration that cannot be determined at the time of issuance will be deemed issuable or to have been issued for $0.01 per share of Common Stock. The rights of Subscriber set forth in this Section 8 are in addition to any other rights the Subscriber has pursuant to this Agreement, any Transaction Documents, and any other agreement referred to or entered into in connection herewith or to which Subscriber and Company are parties. For purposes hereof, “Excepted Issuances” means the (i) Company’s issuances of securities comprising the full or partial consideration in connection with a strategic merger, acquisition, consolidation or purchase of substantially all of the securities or assets of a corporation or other entity that has been approved by a majority of disinterested directors of the Company and in which holders of such securities or debt are not at any time granted registration rightsplus the additional minimum consideration, (ii) the Company’s issuance of securities in connection with strategic license agreements and other partnering arrangements so long as such issuances are not for the purpose of raising capital and which holders of such securities or debt are not at any time granted registration rightsif any, (iii) the Company’s issuance of common stock or its issuances or grants of options to purchase common stock to employees, directors, and officers of be received by the Company pursuant upon the conversion or exercise thereof into Common Stock (the consideration in each case to any stock or option plan duly adopted for such purpose, by a majority of be determined in the non-employee members of the Board of Directors or a majority of the members of a committee of non-employee directors established for such purpose, same manner as provided in clauses (a) and (ivb) the Company’s issuances of securities upon the exercise or exchange of or conversion of any securities exercisable or exchangeable for or convertible into shares of common stock issued and outstanding on the date of this Agreement, provided that such securities have not been amended since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securitiesabove).

Anti-dilution Adjustment. Other (a) In the event that prior to the one year anniversary of the Closing Date the Company shall complete one or more Subsequent Placements at an effective price per share less than the Purchase Price (such lower price, the “New Purchase Price” and such issuances collectively, a “Dilutive Issuance”), as adjusted hereunder (if the holder of the Equity Securities so issued shall at any time, whether by operation of purchase price adjustments, reset provisions, floating conversion, exercise or exchange prices or otherwise, or due to warrants, options or rights per share which is issued in connection with Excepted Issuances (as such term issuance, be entitled to receive shares of Common Stock at an effective price per share which is defined in less than the last sentence Purchase Price, such issuance shall be deemed to have occurred for less than the Purchase Price on such date of this Section 8(b)the Dilutive Issuance), if within twelve months following then the initial Closing of Purchase Price shall be deemed to be equal to the sale of Shares in the Offering, New Purchase Price and the Company shall issue to Investor without the consent receipt of the Majority Holders any Common Stock or securities convertible into or exercisable for additional consideration from Investor an additional number of shares of Common Stock equal to (i) such number of shares determined by dividing the aggregate Purchase Price paid by Investor by the New Purchase Price, less (ii) the number of Shares previously issued to Investor. Notwithstanding the foregoing, no adjustments shall be made, paid or modify issued under this Section 5.2 in respect of Exempt Issuances. (b) Notwithstanding anything to the conversion or exercise price of any contrary in Section 5.2(a), if the Company has not obtained Stockholder Approval (as defined below), then the Company may not issue as a result of the foregoing which may be outstanding) adjustment of the Purchase Price in connection with a Dilutive Issuance a number of shares of Common Stock, which, when aggregated with any shares of Common Stock issued in the Offering pursuant to any person or entity at a price per share which shall be less than 100the Subscription Agreements, would exceed 19.99% of the price per share number of shares of Common Stock outstanding on the Trading Day immediately preceding the Closing Date (such number of shares, the “Issuable Maximum”). If on any adjustment of the Shares purchased by such Subscriber (including any issuances of securities Purchase Price in connection with a Dilutive Issuance, the closing number of a registered primary offering shares of any securities of Common Stock issuable to Investor would exceed the Issuable Maximum and the Company in any jurisdiction), subject to adjustment for stock dividends, subdivisions and combinations shall not have previously obtained Stockholder Approval (the “Lower Price Issuance”as defined below), then the Company shall issue, for each issue to Investor such occasion, additional shares of Common Stock to the Subscriber respecting the Purchased Securities that are then still owned by the Subscriber at the time of the Lower Price Issuance so that the average per share purchase price of the Purchased Securities owned by the Subscriber on the date of the Lower Price Issuance plus such additional shares issued to Subscriber pursuant to this Section 8(b) is equal to such other lower price per share. The delivery to Subscriber of the additional shares of Common Stock shall be not later than the 5 Business Days after the closing date of the transaction giving rise to the requirement to issue additional shares of Common Stock. For purposes of the issuance and adjustment described in this Section 8(b), in the case of the issuance of securities convertible into or exercisable for shares of Common Stock, the price per share shall be deemed to be the quotient obtained by dividing (i) the sum of (A) the price paid for such derivative security plus (B) the aggregate amount of consideration to be paid upon conversion or exercise price of such security for the maximum number of shares for which the derivative security may be converted or exercised, by (ii) the total number of shares of common stock issuable upon conversion or exercise price of such security for the maximum number of shares for which the derivative security may be converted or exercised. The adjustment described in this Section 8(b) shall be made immediately upon the earlier of (x) the issuance of the derivative security or (y) the Company entering into an agreement to issue the derivative security, in each case at a price lower than the price per Share in the Offering (which price is subject to adjustment for stock dividends, subdivisions and combinations), but such adjustment shall not be made again upon any issuance of shares of Common Stock upon conversion equal to such Investor’s pro-portion of such derivative security. Any the Issuable Maximum and, with respect to the remainder of the aggregate number of shares of Common Stock or derivative security issued or issuable by upon the Company for no consideration or for consideration that cannot be determined at adjustment of the time of issuance will be deemed issuable or to have been issued for $0.01 per share of Common Stock. The rights of Subscriber set forth in this Section 8 are in addition to any other rights the Subscriber has pursuant to this Agreement, any Transaction Documents, and any other agreement referred to or entered into in connection herewith or to which Subscriber and Company are parties. For purposes hereof, “Excepted Issuances” means the (i) Company’s issuances of securities comprising the full or partial consideration Purchase Price in connection with a strategic mergerDilutive Issuance, acquisitionthe Company shall be prohibited from issuing such shares of Common Stock until and unless Stockholder Approval has been obtained. (c) Notwithstanding anything to the contrary in Section 5.2(a), consolidation if the Company has not obtained such approval as may be required by the applicable rules and regulations of the Nasdaq Global Market (or purchase any successor entity) from the stockholders of substantially the Company with respect to the transactions contemplated by the Transaction Documents, including the issuance of all of the securities or assets Warrant Shares in excess of a corporation or other entity that has been approved by a majority of disinterested directors 19.99% of the Company and in which holders of such securities or debt are not at any time granted registration rights, (ii) the Company’s issuance of securities in connection with strategic license agreements and other partnering arrangements so long as such issuances are not for the purpose of raising capital and which holders of such securities or debt are not at any time granted registration rights, (iii) the Company’s issuance of common stock or its issuances or grants of options to purchase common stock to employees, directors, and officers of the Company pursuant to any stock or option plan duly adopted for such purpose, by a majority of the non-employee members of the Board of Directors or a majority of the members of a committee of non-employee directors established for such purpose, and (iv) the Company’s issuances of securities upon the exercise or exchange of or conversion of any securities exercisable or exchangeable for or convertible into shares of common stock issued and outstanding Common Stock on the date of this AgreementClosing Date (“Stockholder Approval”), then the Purchase Price shall not be adjusted as provided that such securities have not been amended since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securitiesin Section 5.2(a).