Common use of Subsequent Placements Clause in Contracts

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from the date hereof through April 15, 2003 (including such date) (the "Blockout Period"), the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "Subsequent Placement"). (b) From the end of the Blockout Period until the one (1) year anniversary of the Blockout Period, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b). (i) The Company shall deliver to each Purchaser a written notice (the "Offer") of any proposed or intended issuance or sale or exchange of the securities being offered (the "Offered Securities") in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty percent (40%) of the Offered Securities, in each case based on such Purchaser's pro rata portion of the aggregate purchase price paid by the Purchasers for all of the Shares purchased hereunder (the "Basic Amount"), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "Undersubscription Amount"). (ii) To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to the Company prior to the end of the five (5) Trading Day period of the Offer, setting forth the portion of the Purchaser's Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "Notice of Acceptance"). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "Available Undersubscription Amount"), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen (15) days from the expiration of the period set forth in Section 4.1(b)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "Refused Securities"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person or persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company and their respective counsel. (vi) Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 4.1(b)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (c) Notwithstanding anything herein to the contrary, the restrictions contained in paragraph (a) and (b) of this Section shall not apply to (i) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactions.

Subsequent Placements. (a1) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 until the Registration Statement (including such dateas defined in the Registration Rights Agreements) is declared effective by the SEC (the "Blockout PeriodBLOCKOUT PERIOD"), the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "Subsequent PlacementSUBSEQUENT PLACEMENT"). The restrictions contained in this Section 5(1) shall not apply to Excluded Stock (as defined below). (b2) From the end of the Blockout Period until the one (1) year anniversary of the Blockout Periodthereof, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b5(1)(2). (i) The Company shall deliver to each Purchaser a written notice (the "OfferOFFER") of any proposed or intended issuance or sale or exchange of the securities being offered (the "Offered SecuritiesOFFERED SECURITIES") in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons Persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty percent (40%) of the Offered Securities, in each case based on such Purchaser's pro rata portion of the aggregate purchase price paid by the Purchasers for all of the Shares purchased hereunder (the "Basic AmountBASIC AMOUNT"), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "Undersubscription AmountUNDERSUBSCRIPTION AMOUNT"). (ii) To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to the Company prior to the end of the five (5) Trading Business Day period of the Offer, setting forth the portion of the Purchaser's Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "Notice of AcceptanceNOTICE OF ACCEPTANCE"). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Undersubscription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "Available Undersubscription AmountAVAILABLE UNDERSUBSCRIPTION AMOUNT"), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen ten (1510) days Business Days from the expiration of the period set forth in Section 4.1(b)(ii5(1)(2)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "Refused SecuritiesREFUSED SECURITIES"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person Person or persons Persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii5(1)(2)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii5(l)(2) (ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii5(1)(2) (ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i5(l)(2)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv5(1)(2)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company Purchasers and their respective counsel. (vi) Any Offered Securities not acquired by the Purchasers or other persons Persons in accordance with Section 4.1(b)(iii5(1)(2)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (cvii) Notwithstanding anything herein to the contrary, the The restrictions contained in paragraph (aparagraphs 5(1)(1) and (b2) of this Section shall not apply to (i) the granting of stock options to employees, officers and directors any of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactions.following "EXCLUDED SECURITIES:"

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 (including such date) until the Effective Date (the "Blockout PeriodBLOCKOUT PERIOD"), the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "Subsequent PlacementSUBSEQUENT PLACEMENT"). The restrictions contained in this Section 4.5 shall not apply to Excluded Stock. (b) From the end of the Blockout Period until the one (1) year anniversary of the Blockout Periodthereof, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b4.5(b). (i) The Each Purchaser shall have a right of first refusal to purchase up to its pro rata share in any Subsequent Placement. Each Purchaser's pro rata share is equal to the ratio of (x) the number of Shares and Warrant Shares (assuming full exercise of the Warrants) which such Purchaser purchased on the Closing Date to (y) the total number of shares of the Company's Common Stock (assuming full exercise of the Warrants) outstanding on the Closing Date. (ii) If the Company proposes to effect any Subsequent Offering, it shall deliver to give each Purchaser a written notice (the "Offer") of any proposed or intended issuance or sale or exchange of its intention, describing the securities being offered (the "Offered SecuritiesOFFERED SECURITIES") in a Subsequent Placement), which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons Persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged exchanged, the price (or the anticipated mechanism for determining the price) and (z) offer the terms and conditions upon which the Company proposes to issue and sell to or exchange with each Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty percent (40%) of the Offered Securities, in each case based on such Purchaser's pro rata portion of the aggregate purchase price paid by the Purchasers for all of the Shares purchased hereunder same (the "Basic AmountNOTICE"), and . Each Purchaser shall have not less than seven (B7) with respect Trading Days from the giving of such Notice to each Purchaser that elects agree to purchase up to its Basic Amount, any additional portion pro rata share of the Offered Securities attributable to for the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should price and upon the other Purchasers subscribe for less than their Basic Amounts (terms and conditions specified in the "Undersubscription Amount"). (ii) To accept an Offer, in whole or in part, a Purchaser must deliver a Notice by providing written notice to the Company prior and stating therein the quantity of Offered Securities to be purchased. Notwithstanding the end of the five (5) Trading Day period of the Offer, setting forth the portion of the Purchaser's Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amountforegoing, the Undersubscription Amount, if any, that Company shall not be required to offer or sell such Purchaser elects securities to purchase (in either case, the "Notice of Acceptance"). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each any Purchaser who has set forth an Undersubcription Amount would cause the Company to be in its Notice violation of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "Available Undersubscription Amount"), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount applicable federal securities laws by virtue of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessaryoffer or sale. (iii) The If the Purchasers fail to exercise in full the rights of first refusal (such securities refused, the "REFUSED SECURITIES"), the Company shall have fifteen (15) 10 days from thereafter to sell the expiration of the period set forth in Section 4.1(b)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to in respect of which a Notice of Acceptance has the Purchasers' rights were not been given by the Purchasers (the "Refused Securities")exercised, but only to the offerees described in the Offer Notice (if so described therein) and only at a price and upon general terms and conditions (including, without limitation, unit prices and interest rates) that are not materially no more favorable to the acquiring person or persons or less favorable purchasers thereof than specified in the Notice to the Purchasers pursuant to Section 4.5(b) hereof. If the Company than those set forth has not sold such Offered Securities within 10 days of the Notice provided pursuant to Section 4(b)(ii), the Company shall not thereafter issue or sell any securities, without first offering such Offered Securities to the Purchasers in the Offermanner provided above. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv) above if the Purchasers have so electedacceptance, upon the terms and conditions specified in the OfferNotice. The purchase by the Purchasers Purchasers, of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company Purchasers and their respective counsel. (vi) Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 4.1(b)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (c) Notwithstanding anything herein to the contrary, the restrictions contained in paragraph (a) and (b) of this Section shall not apply to (i) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactions.

Subsequent Placements. (a1) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 until the Registration Statement (including such dateas defined in the Registration Rights Agreements) is declared effective by the SEC (the "Blockout PeriodBLOCKOUT PERIOD"), the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "Subsequent PlacementSUBSEQUENT PLACEMENT"). The restrictions contained in this Section 5(l) shall not apply to Excluded Securities (as defined below). (b) From the end of the Blockout Period until the one (1) year anniversary of the Blockout Period, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b). (i2) The Company shall deliver to each Purchaser a written notice (the "Offer") of any proposed or intended issuance or sale or exchange of the securities being offered (the "Offered Securities") in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty percent (40%) of the Offered Securities, in each case based on such Purchaser's pro rata portion of the aggregate purchase price paid by the Purchasers for all of the Shares purchased hereunder (the "Basic Amount"), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "Undersubscription Amount"). (ii) To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to the Company prior to the end of the five (5) Trading Day period of the Offer, setting forth the portion of the Purchaser's Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "Notice of Acceptance"). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "Available Undersubscription Amount"), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen (15) days from the expiration of the period set forth in Section 4.1(b)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "Refused Securities"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person or persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company and their respective counsel. (vi) Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 4.1(b)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (c) Notwithstanding anything herein to the contrary, the restrictions contained in paragraph (a) and (b5(l)(1) of this Section shall not apply to any of the following "EXCLUDED SECURITIES:" (iA) the granting Shares, (B) the Conversion Shares, (C) the Warrants, (D) any warrants issued to any of stock the Placement Agents, (E) any shares of Common Stock issued upon exercise of the Warrants or any warrants issued to any of the Placement Agents, (F) shares of Common Stock issued in connection with the Additional Financings, (G) warrants issued in connection with the Additional Financings, (H) shares of Common Stock issued upon exercise of warrants issued in connection with the Additional Financings, (I) shares of Common Stock issued upon conversion of the SOED Notes, (J) the Debentures, or (K) any Common Stock issued (1) upon exercise or conversion of any options or other securities described in Schedule 4(c) (provided that such exercise or conversion occurs in accordance with the terms thereof, without amendment or modification, and that the applicable exercise or conversion price or ratio is described in such schedule), (2) in connection with any grant of options, warrants or the issuance of additional securities to employees, officers and officers, directors or consultants of the Company pursuant to any a stock option plan or stock purchase plan duly adopted by the Company Company's board of directors or to in respect of the issuance of Common Stock upon exercise of any such optionsoptions or warrants, (ii3) the issuance of Common Stock to officers or employees pursuant to a bona fide firm commitment underwritten public offering through any employee stock purchase plan or similar plan designed to provide investment banker (excluding any equity compensation to employees of the Company, (iiiline) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or servicesan aggregate offering amount greater than $5,000,000, or (iv4) licensing transactions and transactions that are primarily in connection with a bona fide joint venture or development agreement or strategic transactionspartnership or to an independent Person, the primary purpose of which is not to raise equity capital.

Subsequent Placements. (a) Except for Until the issuance of Common Stock pursuant to Section 1(c), from the date hereof through April 15, 2003 (including such date) Effective Date (the "Blockout Period"), the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "Subsequent Placement"). (b) The Blockout Period set forth in the preceding Section 4.5(a) shall be extended for the number of Trading Days during such period in which (i) trading in the Common Stock is suspended by any Trading Market, (ii) the Registration Statement is not effective, or (iii) the prospectus included in the Registration Statement may not be used by the Purchaser for the resale of Registrable Shares thereunder. (c) From the end of the Blockout Period until the one (1) year 18th month anniversary of the Blockout Periodthereof, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b4.5(c). (i) The Company shall deliver to each the Purchaser a written notice (the "Offer") of any proposed or intended issuance or sale or exchange of the securities being offered (the "Offered SecuritiesShares") in a Subsequent Placement, which Offer shall (w) identify and describe the Offered SecuritiesShares, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities Shares to be issued, sold or exchanged, (y) identify the persons Persons or entities (if known) to which or with which the Offered Securities Shares are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each the Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered SecuritiesShares equal to (A) the aggregate Purchase Price paid by the Purchaser divided by (B) the sum of (i) the aggregate principal amount of the debentures issued pursuant to the Omicron Financing and converted in Common Stock prior to the date of the Subsequent Financing, (ii) 64.171% of the aggregate Purchase Price paid by the Purchaser pursuant to Section 2.1(a) of this Agreement for the Shares at the Per Share Purchase Price, and (2iii) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty percent (40%) of the Offered Securities, in each case based on such Purchaser's pro rata portion of the aggregate purchase price amount paid by the Purchasers for all of the Shares purchased hereunder issued in the Vertical Ventures Financing (the "Basic Amount"), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "Undersubscription Amount"). (ii) To accept an Offer, in whole or in part, a the Purchaser must deliver a written notice to the Company prior to the end of the five ten (510) Trading Day period of the Offer, setting forth the all or any portion of the Purchaser's Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "Notice of Acceptance"). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "Available Undersubscription Amount"), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen ten (1510) days Trading Days from the expiration of the period set forth in Section 4.1(b)(ii4.5(c)(ii) above (the "Subsequent Placement Closing Period") to issue, sell or exchange all or any part of such Offered Securities Shares as to which a Notice of Acceptance has not been given by the Purchasers Purchaser (the "Refused SecuritiesShares"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person Person or persons Persons or less favorable to the Company than those set forth in the Offer. However, if the stock appreciates by more than 15% during the Subsequent Placement Closing Period (or such shorter period from the expiration of the period set forth in Section 4.5(c)(ii) above through the date the Company sets to issue, sell or exchange all or any portion of the Refused Shares), then the Purchaser will have 1 Trading Day to elect to issue a Notice of Acceptance in accordance with Section 4.5(c)(ii) above relating to the Refused Shares. The Company and the Purchaser agree that the Subsequent Placement Closing Period shall be extended until the expiration of the 1 Trading Day period in the immediately preceding sentence. (iv) In the event the Company shall propose to sell less than all the Refused Securities Shares (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii4.5(c)(iii) above), then each the Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities Shares specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities Shares that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii4.5(c)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities Shares the Company actually proposes to issue, sell or exchange (including Offered Securities Shares to be issued or sold to Purchasers Purchaser pursuant to Section 4.1(b)(ii4.5(c)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered SecuritiesShares. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities Shares specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities Shares unless and until such securities have again been offered to the Purchasers Purchaser in accordance with Section 4.1(b)(i4.5(c)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused SecuritiesShares, the Purchasers Purchaser shall acquire from the Company, and the Company shall issue to the PurchasersPurchaser, the number or amount of Offered Securities Shares specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv4.5(c)(iv) above if the Purchasers Purchaser have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers Purchaser of any Offered Securities Shares is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers Purchaser of a purchase agreement relating to such Offered Securities Shares reasonably satisfactory in form and substance to the Purchasers, the Company Purchaser and their its respective counsel. (vi) Any Offered Securities Shares not acquired by the Purchasers Purchaser or other persons Persons in accordance with Section 4.1(b)(iii4.5(c)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers Purchaser under the procedures specified in this Agreement. (cd) Notwithstanding anything herein to the contrary, the The restrictions contained in paragraph (aSections 4.5(a) and (bc) of this Section shall not apply to (i) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactionsExcluded Stock.

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 until the earlier to occur of (including such datex) IPO Event or (y) the Effective Date (the "Blockout PeriodBLOCKOUT PERIOD"), the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "Subsequent PlacementSUBSEQUENT PLACEMENT"). (b) The Blockout Period set forth in the preceding paragraph (a) shall be extended for the number of Business Days following the Effective Date in which (i) the Registration Statement is not effective, or (ii) the prospectus included in the Registration Statement may not be used by the Purchasers for the resale of Registrable Securities thereunder. (c) From the end of the Blockout Period until the one earlier to occur of (1x) the IPO Event or (y) the two year anniversary of the Blockout PeriodEffective Date, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b4.5(c). (i) The Company shall deliver to each Purchaser a written notice (the "OfferOFFER") of any proposed or intended issuance or sale or exchange of the securities being offered (the "Offered SecuritiesOFFERED SECURITIES") in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons Persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty percent (40%) of the Offered Securities, in each case based on such Purchaser's pro rata portion of the aggregate purchase price paid by the Purchasers for all of the Shares Notes purchased hereunder (the "Basic AmountBASIC AMOUNT"), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "Undersubscription AmountUNDERSUBSCRIPTION AMOUNT"). (ii) To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to the Company prior to the end of the five ten (510) Trading Business Day period of the Offer, setting forth the portion of the Purchaser's Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "Notice of AcceptanceNOTICE OF ACCEPTANCE"). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; providedPROVIDED, howeverHOWEVER, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "Available Undersubscription AmountAVAILABLE UNDERSUBSCRIPTION AMOUNT"), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen five (155) days Business Days from the expiration of the period set forth in Section 4.1(b)(ii4.5(c)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "Refused SecuritiesREFUSED SECURITIES"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person Person or persons Persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii4.5(c)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii4.5(c)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii4.5(c)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i4.5(c)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv4.5(c)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company Purchasers and their respective counsel. (vi) Any Offered Securities not acquired by the Purchasers or other persons Persons in accordance with Section 4.1(b)(iii4.5(c)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (d) The restrictions contained in paragraphs (a) and (c) Notwithstanding anything herein of this Section shall not apply to (x) Excluded Stock, (y) the issuance of Common Stock in connection with the IPO Event, or (z) any bona-fide underwritten public offering with a nationally recognized underwriter that will result in proceeds to the contraryCompany equal to or in excess of $5,000,000. In addition, the restrictions contained in paragraph (a) and (b) of this Section shall not apply (x) if the Company obtains the Lead Purchaser's consent or (y) to (i) any Subsequent Placement made for the granting of stock options to employeespurpose of, officers and directors from which the proceeds are used for repayment of the Company pursuant Notes in full, provided, however, that the then-current holders of the Notes shall have a right of first refusal as described in Section 4.5(c) above with respect to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, Subsequent Placement described in this clause (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactionsy).

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 (including such date) (until the "Blockout Period")Effective Date, the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' ’ equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "“Subsequent Placement"”). (b) From the Effective Date until 30 Trading Days after the Effective Date (the “Blockout Period”), the Company will not, directly or indirectly, effect any Subsequent Placement except as set forth in Section 4.6(e). (c) The Blockout Period set forth in Section 4.6(b) above shall be extended for the number of Trading Days during such period in which (i) trading in the Common Stock is suspended by any Trading Market, (ii) the Registration Statement is not effective, or (iii) the prospectus included in the Registration Statement may not be used by the Purchasers for the resale of Registrable Securities thereunder. (d) From the end of the Blockout Period until and for so long as the one (1) year anniversary of the Blockout PeriodNotes are outstanding, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b4.6(d). (i) The At least 10 Trading Days prior to the closing of a Subsequent Placement, the Company shall deliver to each Purchaser a written notice of its intention to effect a Subsequent Placement ("Pre-Notice"), which Pre-Notice shall ask such Purchaser if it wants to review the "Offer"details of such Subsequent Placement (such additional notice, a “Subsequent Placement Notice”). (ii) Upon the request of any a Purchaser, and only upon a request by such Purchaser, for a Subsequent Placement Notice, the Company shall promptly, but no later than 1 Trading Day after such request, deliver to each Purchaser the Subsequent Placement Notice of the proposed or intended issuance or sale or exchange of the securities being offered (the "“Offered Securities"”) in a Subsequent Placement, which Offer Subsequent Placement Notice shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons Persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser (an “Offer”) (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty percent (40%) of the Offered Securities, in each case Securities based on such Purchaser's ’s pro rata portion of the aggregate purchase price paid by the Purchasers for all principal amount of the Shares Notes purchased hereunder (the "“Basic Amount"”), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "“Undersubscription Amount"”). (iiiii) To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to the Company prior to the end of the five (5) 10 Trading Day period of the Offer, setting forth the portion of the Purchaser's ’s Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "“Notice of Acceptance"”). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "“Available Undersubscription Amount"”), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iiiiv) The Company shall have fifteen seven (157) days Trading Days from the expiration of the period set forth in Section 4.1(b)(ii4.6(d)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "“Refused Securities"”), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person Person or persons Persons or less favorable to the Company than those set forth in the Offer. (ivv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii4.6(d)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii4.6(d)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii4.6(c)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i4.6(d)(i) above. (vvi) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv4.6(d)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company Purchasers and their respective counsel. (vivii) Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 4.1(b)(iii4.6(d)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (ce) Notwithstanding anything herein to the contrary, the The restrictions contained in paragraph paragraphs (ab) and (bd) of this Section 4.6 shall not apply to (i) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactionsExcluded Stock.

Subsequent Placements. (a) Except for with respect to the issuance actions set forth in clauses (D) and (E) in the definition of Common Stock pursuant to Section 1(c)Excluded Stock, from the date hereof through April 15, 2003 (including such date) (until the "Blockout Period")Effective Date, the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' ’ equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "“Subsequent Placement"”). (b) From the Effective Date until 30 Trading Days after the Effective Date (the “Blockout Period”), the Company will not, directly or indirectly, effect any Subsequent Placement except as set forth in Section 4.5(e). (c) The Blockout Period set forth in Section 4.5(b) above shall be extended for the number of Trading Days during such period in which (i) trading in the Common Stock is suspended by any Trading Market or (ii) the prospectus included in the Registration Statement may not be used by the Investors for the resale of Registrable Securities thereunder. (d) From the end of the Blockout Period until the one (1) year anniversary of the Blockout PeriodEffective Date, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b4.5(d). (i) The Company shall deliver to each Purchaser Investor a written notice (the "Offer") of any proposed or intended issuance or sale or exchange of the securities being offered (the "“Offered Securities"”) in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons Persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser Investor (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty percent (40%) 50% of the Offered Securities, in each case Securities based on such Purchaser's Investor’s pro rata portion of the aggregate purchase price Investment Amount paid by the Purchasers Investors for all of the Shares Securities purchased hereunder (the "Basic Amount"), and (B) with respect to each Purchaser Investor that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers Investors as such Purchaser Investor shall indicate it will purchase or acquire should the other Purchasers Investors subscribe for less than their Basic Amounts (the "“Undersubscription Amount"”); provided, however, that under no circumstances may any Investor purchase any of the Basic Amount or Undersubscription Amount to which it would otherwise be entitled to the extent that such Investor would beneficially own, directly or on an as converted basis, if applicable, more than 9.99% of the Common Stock outstanding calculated on a pro forma basis. (ii) To accept an Offer, in whole or in part, a Purchaser Investor must deliver a written notice to the Company prior to the end of the five ten (510) Trading Day period of the Offer, setting forth the portion of the PurchaserInvestor's Basic Amount that such Purchaser Investor elects to purchase and, if such Purchaser Investor shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser Investor elects to purchase (in either case, the "Notice of Acceptance"). If the Basic Amounts subscribed for by all Purchasers Investors are less than the total of all of the Basic Amounts, then each Purchaser Investor who has set forth an Undersubcription Undersubscription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "“Available Undersubscription Amount"”), each Purchaser Investor who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser Investor bears to the total Basic Amounts of all Purchasers Investors that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen five (155) days Trading Days from the expiration of the period set forth in Section 4.1(b)(ii4.5(d)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers Investors (the "Refused Securities"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person Person or persons Persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii4.5(d)(iii) above), then each Purchaser Investor may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser Investor elected to purchase pursuant to Section 4.1(b)(ii4.5(d)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers Investors shall acquire from the Company, and the Company shall issue to the PurchasersInvestors, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv4.5(d)(iv) above if the Purchasers Investors have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers Investors of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers Investors of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company Investors and their respective counsel. (vi) Any Offered Securities not acquired by the Purchasers Investors or other persons in accordance with Section 4.1(b)(iii4.5(d)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers Investors under the procedures specified in this Agreement. (ce) Notwithstanding anything herein to the contrary, the The restrictions contained in paragraph paragraphs (ab) and (bd) of this Section 4.5 shall not apply to (i) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactionsExcluded Stock.

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 (including such date) until 30 Trading Days after the Effective Date (the "Blockout PeriodBLOCKOUT PERIOD"), the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "Subsequent PlacementSUBSEQUENT PLACEMENT"). (b) The Blockout Period set forth in the preceding paragraph (a) shall be extended for the number of Trading Days during such period in which (i) trading in the Common Stock is suspended by any Trading Market, (ii) the Registration Statement is not effective, or (iii) the prospectus included in the Registration Statement may not be used by the Purchasers for the resale of Registrable Securities thereunder. (c) From the end of the Blockout Period until the one (1) year anniversary of the Blockout Periodthereof, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b4.5(c). (i) The Company shall deliver to each Purchaser a written notice (the "OfferOFFER") of any proposed or intended issuance or sale or exchange of the securities being offered (the "Offered SecuritiesOFFERED SECURITIES") in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons Persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty percent (40%) of the Offered Securities, in each case based on such Purchaser's pro rata portion of the aggregate purchase price paid by the Purchasers for all of the Shares purchased hereunder (the "Basic AmountBASIC AMOUNT"), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "Undersubscription AmountUNDERSUBSCRIPTION AMOUNT"). (ii) To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to the Company prior to the end of the five ten (510) Trading Day period of the Offer, setting forth the portion of the Purchaser's Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "Notice of AcceptanceNOTICE OF ACCEPTANCE"). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "Available Undersubscription AmountAVAILABLE UNDERSUBSCRIPTION AMOUNT"), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen five (155) days Trading Days from the expiration of after the period set forth in Section 4.1(b)(ii4.5(c)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "Refused SecuritiesREFUSED SECURITIES"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person Person or persons Persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii4.5(c)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii4.5(c)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii4.5(c)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i4.5(c)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv4.5(c)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company Purchasers and their respective counsel. (vi) Any Offered Securities not acquired by the Purchasers or other persons Persons in accordance with Section 4.1(b)(iii4.5(c)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (cd) Notwithstanding anything herein to the contrary, the The restrictions contained in paragraph paragraphs (a) and (bc) of this Section shall not apply to (i) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactionsExcluded Stock.

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 (including such date) (until the "Blockout Period")Effective Date, the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "Subsequent Placement"). (b) From the Effective Date until 30 Trading Days after the Effective Date (the "Blockout Period"), the Company will not, directly or indirectly, effect any Subsequent Placement except as set forth in Section 4.5(e). 00 / XXXX 0000 Exhibit 99.4 (c) The Blockout Period set forth in Section 4.5(b) above shall be extended for the number of Trading Days during such period in which (i) trading in the Common Stock is suspended by any Trading Market, (excluding general suspensions of trading in such Trading Market), (ii) the Registration Statement is not effective after the Required Effectiveness Date, or (iii) the prospectus included in the Registration Statement may not be used by the Purchasers for the resale of Registrable Securities thereunder. (d) From the end of the Blockout Period until the one (1) year anniversary of the Blockout Periodthereof, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b4.5(d). (i) The Company shall deliver to each Purchaser a written notice (the "Offer") of any proposed or intended issuance or sale or exchange of the securities being offered (the "Offered Securities") in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty percent (40%) of the Offered Securities, in each case Securities based on such Purchaser's pro rata portion of the aggregate purchase price paid by the Purchasers for all of the Shares purchased hereunder (the "Basic Amount"), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "Undersubscription Amount"). (ii) To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to the Company prior to the end of the five ten (510) Trading Day period of the Offer, setting forth the portion of the Purchaser's Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "Notice of Acceptance"). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "Available Undersubscription Amount"), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen ten (1510) days Trading Days from the expiration of the period set forth in Section 4.1(b)(ii4.5(d)(ii) above to issue, sell or exchange (or any binding commitments thereto) all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "Refused Securities"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person or persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company and their respective counsel. (vi) Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 4.1(b)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (c) Notwithstanding anything herein to the contrary, the restrictions contained in paragraph (a) and (b) of this Section shall not apply to (i) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactions.

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 until the effective date of the registration statement (including such datethe "Registration Statement") relating to the resale of the Shares and Warrant Shares (the "Blockout Period"), the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "Subsequent Placement"). (b) From the end of the Blockout Period until the one (1) year 12 month anniversary of the Blockout Periodthereof, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b3.12(b). (i) The Company shall deliver to each Purchaser a written notice (the "Offer") of any proposed or intended issuance or sale or exchange of the securities being offered (the "Offered Securities") in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty percent (40%) 50% of the Offered Securities, in Securities equal to (A) the aggregate purchase price paid by each case based on such Purchaser's pro rata portion of Purchaser divided by (B) the aggregate purchase price paid by the Purchasers for all of the Shares purchased hereunder (the "Basic Amount"), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "Undersubscription Amount"). (ii) To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to the Company prior to the end of the five (5) Trading Day period of the Offer, setting forth the portion of the Purchaser's Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "Notice of Acceptance"). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "Available Undersubscription Amount"), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen (15) days from the expiration of the period set forth in Section 4.1(b)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "Refused Securities"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person or persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company and their respective counsel. (vi) Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 4.1(b)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (c) Notwithstanding anything herein to the contrary, the restrictions contained in paragraph (a) and (b) of this Section shall not apply to (i) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactions.of

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 (including such date) (until the "Blockout Period")Effective Date, the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Significant Subsidiaries' ’ equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents Equivalents, but not including any Excluded Stock, (any such offer, sale, grant, disposition or announcement being referred to as a "“Subsequent Placement"”), except as permitted by this Section 4.5. (b) From the end of the Blockout Period Effective Date until the one (1) year anniversary of the Blockout Periodthereof, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b4.5(b). (i) The Company shall deliver to each Purchaser a written notice (the "“Offer"”) of any proposed or intended issuance or sale or exchange of the securities being offered (the "“Offered Securities"”) in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty fifty percent (4050%) of the Offered Securities, in each case Securities based on such Purchaser's ’s pro rata portion of the aggregate purchase price paid by the Purchasers for all of the Shares purchased hereunder (the "“Basic Amount"”), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "“Undersubscription Amount"”). (ii) To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to the Company prior to the end of the five (5) Trading Day period of the Offer, setting forth the portion of the Purchaser's ’s Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "“Notice of Acceptance"”), provided that the Purchaser may also give a Notice of Acceptance at anytime prior to the date that is 10 days prior to the closing of such Subsequent Placement. If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "“Available Undersubscription Amount"”), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen (15) days 120 Trading Days from the expiration of the five Trading Day period set forth in Section 4.1(b)(ii4.5(b)(ii) above to issue, sell or exchange (or any binding commitment thereto) all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "“Refused Securities"”), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person or persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii4.5(b)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii4.5(b)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii4.5(b)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i4.5(b)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv4.5(b)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company Purchasers and their respective counsel. (vi) Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 4.1(b)(iii4.5(b)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (c) Notwithstanding anything herein to the contrary, the The restrictions contained in paragraph (a) and (b) of this Section 4.5 shall not apply to (i) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactionsExcluded Stock.

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 (including such date) (until the "Blockout Period")Effective Date, the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "Subsequent PlacementSUBSEQUENT PLACEMENT"). (b) From the Effective Date until 30 Trading Days after the Effective Date (the "BLOCKOUT PERIOD"), the Company will not, directly or indirectly, effect any Subsequent Placement except as set forth in Section 4.6(e). (c) The Blockout Period set forth in Section 4.6(b) above shall be extended for the number of Trading Days during such period in which (i) trading in the Common Stock is suspended by any Trading Market, (ii) the Registration Statement is not effective, or (iii) the prospectus included in the Registration Statement may not be used by the Purchasers for the resale of Registrable Securities thereunder. (d) From the end of the Blockout Period until the one (1) year anniversary of the Blockout Periodthereof, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b4.6(d). (i) The Company shall deliver to each Purchaser a written notice (the "OfferOFFER") of any proposed or intended issuance or sale or exchange of the securities being offered (the "Offered SecuritiesOFFERED SECURITIES") in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons Persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty percent (40%) of the Offered Securities, in each case Securities based on such Purchaser's pro rata portion of the aggregate purchase price paid by the Purchasers for all principal amount of the Shares Notes purchased hereunder (the "Basic AmountBASIC AMOUNT"), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "Undersubscription AmountUNDERSUBSCRIPTION AMOUNT"). (ii) To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to the Company prior to the end of the five (5) 10 Trading Day period of the Offer, setting forth the portion of the Purchaser's Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "Notice of AcceptanceNOTICE OF ACCEPTANCE"). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "Available Undersubscription AmountAVAILABLE UNDERSUBSCRIPTION AMOUNT"), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen five (155) days Trading Days from the expiration of the period set forth in Section 4.1(b)(ii4.6(d)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "Refused SecuritiesREFUSED SECURITIES"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person Person or persons Persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii4.6(d)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii4.6(d)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii4.6(c)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i4.6(d)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv4.6(d)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company Purchasers and their respective counsel. (vi) Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 4.1(b)(iii4.6(d)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (ce) Notwithstanding anything herein to the contrary, the The restrictions contained in paragraph paragraphs (ab) and (bd) of this Section 4.6 shall not apply to (iA) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock or grant of Options to employees, officers, directors of or consultants or advisors to the Company, in each case, pursuant to a stock-based plan, contractual or other arrangements duly approved by the Company's board of directors; (B) upon exercise, conversion or exchange of any Common Stock Equivalents described in Schedule 3.1 (g) (provided that such exercise of such optionsor conversion occurs in accordance with the terms thereof, without amendment or modification); or (iiC) the issuance of Common Stock to officers securities in connection with a joint venture or employees pursuant to any employee stock purchase plan development agreement or strategic partnership or similar plan designed to provide equity compensation to employees of agreement approved by the Company's board of directors, (iii) the issuance a primary purpose of Common Stock which is not to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactionsraise equity capital.

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 (including such date) until 30 Trading Days following the Effective Date (the "“Blockout Period"”), the Company will notnot file any Registration Statement which registers, for sale for the account of the Company or for resale for the account of any other person (except pursuant to rights set forth in Schedule 3.1(n) hereto), directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "Subsequent Placement")Equivalents. (b) From the end of the Blockout Period until through the one (1) year anniversary 30th Trading Day following the end of the Blockout Period, but in no event later than June 30, 2005 (the “Subsequent Placement Period”), the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b). (i) The Company shall deliver to each Purchaser a written notice (the "“Offer"”) of any proposed or intended issuance or sale or exchange of the securities being offered (the "“Offered Securities"”) in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchangedexchanged (the “Offered Amount”), (y) identify the persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty fifty percent (4050%) of the difference between (I) the Offered SecuritiesAmount, in each case less (II) any Offered Securities purchased by Celgene Corporation pursuant to their rights under Section 4.1 of that certain Securities Purchase Agreement, dated as of December 31, 2002, by and between the Company and Celgene Corporation, based on such Purchaser's ’s pro rata portion of the aggregate purchase price paid by the Purchasers for all of the Shares purchased hereunder (the "“Basic Amount"”), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "“Undersubscription Amount"”). (ii) To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to the Company prior to the end of the five (5) Trading Day period of the Offer, setting forth the portion of the Purchaser's ’s Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "“Notice of Acceptance"”). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Undersubscription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "“Available Undersubscription Amount"”), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen ten (1510) days from the expiration of the period set forth in Section 4.1(b)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "“Refused Securities"”), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person or persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company and their respective counsel. (vi) Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 4.1(b)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (c) Notwithstanding anything herein to The Blockout Period set forth in Section 4.5(a) and the contrary, the restrictions Subsequent Placement Period contained in paragraph Section 4.5(b) shall (ai) be extended for the number of Trading Days during such period in which (x) trading in the Common Stock is suspended by any Trading Market, (y) the Registration Statement is not effective, or (z) the prospectus included in the Registration Statement may not be used by the Purchasers for the resale of Registrable Securities thereunder; and (bii) of this Section shall not apply to (i) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactionsExcluded Stock.

Subsequent Placements. (a) Except for Other than the issuance of Common Stock pursuant to Section 1(c)Kraft Financing, from the date hereof through April 15, 2003 (including such date) (until the "Blockout Period")Effective Date, the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' ’ equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "“Subsequent Placement"”). (b) Other than the Kraft Financing, from the Effective Date until 30 Trading Days after the Effective Date (the “Blockout Period”), the Company will not, directly or indirectly, effect any Subsequent Placement except as set forth in Section 4.6(e). (c) The Blockout Period set forth in Section 4.6(b) above shall be extended for the number of Trading Days during such period in which (i) trading in the Common Stock is suspended by any Trading Market, (ii) the Registration Statement is not effective, or (iii) the prospectus included in the Registration Statement may not be used by the Purchasers for the resale of Registrable Securities thereunder. (d) From the end of the Blockout Period until and for so long as the one (1) year anniversary of the Blockout PeriodNotes are outstanding, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b4.6(d). (i) The Company shall deliver to each Purchaser a written notice (the "“Offer"”) of any proposed or intended issuance or sale or exchange of the securities being offered (the "“Offered Securities"”) in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons Persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and greater of (2I) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty percent one-third (40%1/3) of the Offered SecuritiesSecurities and (II) Offered Securities with an aggregate principal amount of $2,500,000, in each case either case, based on such Purchaser's ’s pro rata portion of the aggregate purchase price paid by the Purchasers for all principal amount of the Shares Notes purchased hereunder (the "“Basic Amount"”), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "“Undersubscription Amount"”). (ii) To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to the Company prior to the end of the five (5) 10 Trading Day period of the Offer, setting forth the portion of the Purchaser's ’s Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "“Notice of Acceptance"”). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "“Available Undersubscription Amount"”), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen five (155) days Trading Days from the expiration of the period set forth in Section 4.1(b)(ii4.6(d)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "“Refused Securities"”), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person Person or persons Persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii4.6(d)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii4.6(d)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii4.6(d)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i4.6(d)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv4.6(d)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company Purchasers and their respective counsel. (vi) Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 4.1(b)(iii4.6(d)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (ce) Notwithstanding anything herein to the contrary, the The restrictions contained in paragraph paragraphs (ab) and (bd) of this Section 4.6 shall not apply to Excluded Stock. (if) Notwithstanding anything to the granting of stock options to employeescontrary set forth above, officers and directors of the Company pursuant to any stock option plan duly adopted by shall comply with the Company or to requirements set forth in Section 4.6(d) above in connection with the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactionsKraft Financing.

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 (including such date) until the Effective Date (the "Blockout Period"), the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "Subsequent Placement"). (b) From the end of the Blockout Period until the one (1) year anniversary of 90th Trading Day from the Blockout PeriodEffective Date, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b4.5(b). (i) The Company shall deliver to each Purchaser a written notice (the "Offer") of any proposed or intended issuance or sale or exchange of the securities being offered (the "Offered Securities") in a Subsequent Placement, which Offer shall (v) include an email address to which the Purchasers may transmit the Notice of Acceptance (as defined below); (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons or entities (if known) Persons to which or with which the Offered Securities are to be offered, issued, sold or exchanged (unless restricted by a confidentiality agreement, in which case the Company will include a reasonably detailed description of type and nature of such Persons), and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the greater of (1) all of such Offered Securities, but not more than an aggregate of $5,000,000 of such Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary 25% of the Blockout Period, a pro rata portion of an amount equal to forty percent (40%) of the such Offered Securities, in each case based on such Purchaser's pro rata portion of the aggregate purchase price paid by the Purchasers for all of the Shares purchased hereunder (the "Basic Amount"), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "Undersubscription Amount"). (ii) To accept an Offer, in whole or in part, a Purchaser must promptly (and in any event not later than the close of business on the next Business Day after the day on which the Offer is received by such Purchaser) deliver a written notice to the Company prior to the end of the five (5) Trading Day period of the Offer, setting forth the portion of the Purchaser's Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "Notice of Acceptance"). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Undersubscription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between -------- ------- the total of all the Basic Amounts and the Basic Amounts subscribed for (the "Available Undersubscription Amount"), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on only that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen (15) days three Trading Days from the expiration of the period set forth in Section 4.1(b)(ii4.5(b)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "Refused Securities"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person Person or persons Persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii4.5(b)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii4.5(b)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii4.5(b)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i4.5(b)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv4.5(b)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company Purchasers and their respective counsel. (vi) Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 4.1(b)(iii4.5(b)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (c) Notwithstanding anything herein to the contrary, the The restrictions contained in paragraph paragraphs (a) and (b) of this Section 4.5 shall not apply to (i) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactionsExcluded Stock.

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 (including such date) (until the "Blockout Period")Effective Date, the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the its Subsidiaries' equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "Subsequent PlacementSUBSEQUENT PLACEMENT"). (b) From the Effective Date until 30 Trading Days after the Effective Date (the "BLOCKOUT PERIOD"), the Company will not, directly or indirectly, effect any Subsequent Placement except as set forth in Section 4.5(e). (c) The Blockout Period set forth in Section 4.5(b) above shall be extended for the number of Trading Days during such period in which (i) trading in the Common Stock is suspended by any Trading Market, (ii) the Registration Statement is not effective, or (iii) the prospectus included in the Registration Statement may not be used by the Purchasers for the resale of Registrable Securities thereunder. (d) From the end of the Blockout Period until the one (1) year anniversary of the Blockout Periodthereof, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b4.5(d). (i) The Company shall deliver to each Purchaser a written notice (the "OfferOFFER") of any proposed or intended issuance or sale or exchange of the securities being offered (the "Offered SecuritiesOFFERED SECURITIES") in a Subsequent Placement, which Offer shall (wx) identify and describe the Offered Securities, (xy) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty percent (40%) of the Offered Securities, in each case Securities based on such Purchaser's pro rata portion of the aggregate purchase price paid by the Purchasers for all of the Shares purchased hereunder hereunder, subject only to similar participation rights of other equity holders in the Company outstanding on the date hereof (the "Basic AmountBASIC AMOUNT"), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "Undersubscription AmountUNDERSUBSCRIPTION AMOUNT"). (ii) To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to the Company prior to the end of the five three (53) Trading Day period of the Offer, setting forth the portion of the Purchaser's Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "Notice of AcceptanceNOTICE OF ACCEPTANCE"). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts -------- ------- subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "Available Undersubscription AmountAVAILABLE UNDERSUBSCRIPTION AMOUNT"), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen If the Purchasers shall, in accordance with clause (15ii) days from the expiration of this Section 4.5(d) elect to purchase all, but not less than all of the period set forth in Section 4.1(b)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by on the Purchasers (the "Refused Securities"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person or persons or less favorable to the Company than those set forth in the Offer. (iv) In the event , then the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Companynegotiate definitive agreements related thereto, and the Company shall issue to not offer the Purchasers, the number or amount of Offered Securities specified in the Notices to any other Person, for a period of Acceptance, as reduced pursuant to Section 4.1(b)(ivnot less than thirty (30) above if the Purchasers have so elected, upon the terms and conditions specified in the Offerdays. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company Purchasers and their respective counsel. (viiv) If the Purchasers shall not have elected to purchase all of the Offered Securities pursuant to clause (ii) of this Section 4.5(d), or the Company and the Purchasers (notwithstanding the Company's good faith efforts to do so) are not able to agree on definitive agreements regarding such purchase, then the Company shall have sixty (60) calendar days from the expiration of the period set forth in Section 4.5(d)(ii) above to enter into definitive agreements to issue, sell or exchange all of such Offered Securities to any person, provided that the terms of such transactions shall be no less favorable to the Company (as determined in the reasonable judgment of the Board of Directors of the Company) than as set forth in the Offer ("THIRD PARTY OFFERING"); provided, however, upon the completion of definitive documents for the Third Party Offering and at -------- ------- least 5 Trading Days prior to the closing thereof, the Company shall re-offer to the Purchasers the right to participate in the Third Party Offering up to an amount equal to the aggregate purchase price of the Third Party Offering multiplied by the fraction equal to the number of Shares and Warrant Shares (exercised and unexercised, ignoring any limitations on exercise therein for purposes of such calculation) divided by the Company's outstanding Common Stock on a fully diluted basis. Such Offer shall otherwise be made pursuant to the terms of Sections 4.5(d)(i) and 5.4(d)(ii), including each Purchaser's right to any Available Undersubscription Amount (in respect of the securities offered to Purchasers pursuant to this clause (v)) and, in addition to the information required pursuant o Section 4.5(d)(i), the Company shall identify the Persons or entities to which or with which the Offered Securities are to be offered, issued, sold or exchanged. (v) Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 4.1(b)(iii4.5(d)(iv) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (ce) Notwithstanding anything herein to the contrary, the The restrictions contained in paragraph (a) and (b) of this Section 4.5 shall not apply to (i) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactionsExcluded Stock.

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 (including such date) until the Effective Date (the "Blockout Period"), the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "Subsequent Placement"). (b) From the end of the Blockout Period until the one (1) two year anniversary of the end of the Blockout Period, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b6.5(b). (i) The Company shall deliver to each Principal Purchaser a written notice (the "Offer") of any proposed or intended issuance or sale or exchange of the securities being offered (the "Offered Securities") in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser the Principal Purchasers (A) (1) with respect to the period from the end of the Blockout Period until the seven month one year anniversary of the end of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the end of the Blackout Period until the two year anniversary of the end of the Blockout Period, a pro rata portion of an amount equal to forty fifty percent (4050%) of the Offered Securities, in each case based on such Principal Purchaser's pro rata portion of the aggregate purchase price paid by the Principal Purchasers for all of the Shares purchased by the Principal Purchasers hereunder (the "Basic Amount"), and (Bb) with respect to each Principal Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Principal Purchasers as such Principal Purchaser shall indicate it will purchase or acquire should the other Principal Purchasers subscribe for less than their Basic Amounts (the "Undersubscription Amount"). (ii) To accept an Offer, in whole or in part, a Principal Purchaser must deliver a written notice to the Company prior to the end of the five (5) Trading Day period of the OfferOffer (the "Offer Period"), setting forth the portion of the Purchaser's Basic Amount that such Principal Purchaser elects to purchase and, if such Principal Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Principal Purchaser elects to purchase (in either case, the "Notice of Acceptance"). If the Basic Amounts subscribed for by all Principal Purchasers are less than the total of all of the Basic Amounts, then each Principal Purchaser who has set forth an Undersubcription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "Available Undersubscription Amount"), each Principal Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on only that portion of the Available Undersubscription Amount as the Basic Amount of such Principal Purchaser bears to the total Basic Amounts of all Principal Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. If requested by the Company, a Principal Purchaser shall promptly confirm in writing any decision not to purchase Offered Securities. (iii) The Company shall have fifteen ten (1510) days Trading Days from the expiration of the period set forth in Section 4.1(b)(ii) Offer Period above to offer, issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Principal Purchasers (the "Refused Securities"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person or persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii6.5(b)(iii) above), then each Principal Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Principal Purchaser elected to purchase pursuant to Section 4.1(b)(ii6.5(b)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Principal Purchasers pursuant to Section 4.1(b)(ii6.5(b)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Principal Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Principal Purchasers in accordance with Section 4.1(b)(i6.5(b)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Principal Purchasers shall acquire from the Company, and the Company shall issue to the Principal Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv6.5(b)(iv) above if the Principal Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Principal Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Principal Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company Principal Purchasers and their respective counsel. (vi) Any Offered Securities not acquired by the Principal Purchasers or other persons in accordance with Section 4.1(b)(iii6.5(b)(iii) above may not be issued, sold or exchanged until they are again offered to the Principal Purchasers under the procedures specified in this Agreement. (vii) Anything in this Section 6.5 to the contrary notwithstanding, the rights of the Principal Purchasers in this Section 6.5 are subordinate and subject to the preemptive rights of the holders of the Series 2 Preferred Stock to purchase up to five percent of any offering of Common Stock or Common Stock Equivalents. (c) Notwithstanding anything herein to the contrary, the The restrictions contained in paragraph paragraphs (a) and (b) of this Section 6.5 shall not apply to (i) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactionsExcluded Stock.

Subsequent Placements. (a) Except for Other than with respect to the issuance of Common Stock pursuant to Section 1(c)Omicron Financing, from the date hereof through April 15, 2003 (including such date) until the Effective Date (the "Blockout Period"), the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "Subsequent Placement"). (b) The Blockout Period set forth in the preceding paragraph (a) shall be extended for the number of Trading Days during such period in which (i) trading in the Common Stock is suspended by any Trading Market, (ii) the Registration Statement is not effective, or (iii) the prospectus included in the Registration Statement may not be used by the Purchasers for the resale of Registrable Securities thereunder. (c) From the end of the Blockout Period until the one (1) year 18th month anniversary of the Blockout Periodthereof, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b4.5(c). (i) The Company shall deliver to each Purchaser a written notice (the "Offer") of any proposed or intended issuance or sale or exchange of the securities being offered (the "Offered Securities") in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons Persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount Securities equal to forty percent (40%A) of the Offered Securities, in each case based on such Purchaser's pro rata portion of the aggregate purchase price paid by each Purchaser divided by (B) the sum of (i) the aggregate principal amount of the debentures issued pursuant to the Omicron Financing and converted into Common Stock prior to the date of the Subsequent Placement and (ii) the aggregate principal amount paid by the Purchasers for all of the Shares purchased hereunder (the "Basic Amount"), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "Undersubscription Amount"). (ii) To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to the Company prior to the end of the five ten (510) Trading Day period of the Offer, setting forth the portion of the Purchaser's Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "Notice of Acceptance"). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "Available Undersubscription Amount"), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen ten (1510) days Trading Days from the expiration of the period set forth in Section 4.1(b)(ii4.5(c)(ii) above (the "Subsequent Placement Closing Period") to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "Refused Securities"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person Person or persons Persons or less favorable to the Company than those set forth in the Offer. However, if the stock appreciates by more than 15% during the Subsequent Placement Closing Period (or such shorter period from the expiration of the period set forth in Section 4.5(c)(ii) above through the date the Company sets to issue, sell or exchange all or any portion of the Refused Securities), then the Purchasers will have 1 Trading Day to elect to issue a Notice of Acceptance in accordance with Section 4.5(c)(ii) above relating to the Refused Securities. The Company and the Purchasers agree that the Subsequent Placement Closing Period shall be extended until the expiration of the 1 Trading Day period in the immediately preceding sentence. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii4.5(c)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii4.5(c)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii4.5(c)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i4.5(c)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv4.5(c)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company Purchasers and their respective counsel. (vi) Any Offered Securities not acquired by the Purchasers or other persons Persons in accordance with Section 4.1(b)(iii4.5(c)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (cd) Notwithstanding anything herein to the contrary, the The restrictions contained in paragraph paragraphs (a) and (bc) of this Section shall not apply to (i) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactionsExcluded Stock.

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 (including such date) (until the "Blockout Period")Effective Date, the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' ’ equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "“Subsequent Placement"”). (b) From the Effective Date until 90 Trading Days after the Effective Date (the “Blockout Period”), the Company will not, directly or indirectly, effect any Subsequent Placement except as set forth in Section 4.5(e). (c) The Blockout Period set forth in Section 4.5(b) above shall be extended for the number of Trading Days during such period in which (i) trading in the Common Stock is suspended by any Trading Market, (ii) the Registration Statement is not effective, or (iii) the prospectus included in the Registration Statement may not be used by the Purchasers for the resale of Registrable Securities thereunder. (d) From the end of the Blockout Period until the one (1) year anniversary of the Blockout Periodthereof, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b4.5(d). (i) The Company shall deliver to each Lead Purchaser a written notice (the "“Offer"”) of any proposed or intended issuance or sale or exchange of the securities being offered (the "“Offered Securities"”) in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Lead Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty percent (40%) half of the Offered Securities, in each case Securities based on such Lead Purchaser's ’s pro rata portion of the aggregate purchase price paid by the Lead Purchasers for all of the Shares purchased hereunder (the "“Basic Amount"”), and (B) with respect to each Lead Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Lead Purchasers as such Lead Purchaser shall indicate it will purchase or acquire should the other Lead Purchasers subscribe for less than their Basic Amounts (the "“Undersubscription Amount"”). (ii) To accept an Offer, in whole or in part, a Lead Purchaser must deliver a written notice to the Company prior to the end of the five ten (510) Trading Day period of the Offer, setting forth the portion of the Lead Purchaser's ’s Basic Amount that such Lead Purchaser elects to purchase and, if such Lead Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Lead Purchaser elects to purchase (in either case, the "“Notice of Acceptance"”). If the Basic Amounts subscribed for by all Lead Purchasers are less than the total of all of the Basic Amounts, then each Lead Purchaser who has set forth an Undersubcription Undersubscription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "“Available Undersubscription Amount"”), each Lead Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Lead Purchaser bears to the total Basic Amounts of all Lead Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen five (155) days Trading Days from the expiration of the period set forth in Section 4.1(b)(ii4.5(d)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Lead Purchasers (the "“Refused Securities"”), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person or persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii4.5(d)(iii) above), then each Lead Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Lead Purchaser elected to purchase pursuant to Section 4.1(b)(ii4.5(d)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Lead Purchasers pursuant to Section 4.1(b)(ii4.5(c)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Lead Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Lead Purchasers in accordance with Section 4.1(b)(i4.5(d)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Lead Purchasers shall acquire from the Company, and the Company shall issue to the Lead Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv4.5(d)(iv) above if the Lead Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Lead Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Lead Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company Lead Purchasers and their respective counsel. (vi) Any Offered Securities not acquired by the Lead Purchasers or other persons in accordance with Section 4.1(b)(iii4.5(d)(iii) above may not be issued, sold or exchanged until they are again offered to the Lead Purchasers under the procedures specified in this Agreement. (ce) Notwithstanding anything herein to the contrary, the The restrictions contained in paragraph paragraphs (ab) and (bd) of this Section 4.5 shall not apply to (iA) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock or grant of Options to employees, officers, directors of or consultants or advisors to the Company, in each case, pursuant to a stock-based plan duly approved by the Company’s board of directors; (B) upon exercise, conversion or exchange of any Common Stock Equivalents described in Schedule 3.1(f) (provided that such exercise of such optionsor conversion occurs in accordance with the terms thereof, without amendment or modification); (iiC) the issuance of Common Stock to officers or employees securities pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company’s bona fide acquisition of another corporation, or all or a portion of its assets, by merger, purchase of assets or other corporate reorganization in each case, as approved by the Company’s board of directors and not for the principal purpose of raising cash, or (iiiD) the issuance of Common Stock securities in connection with a joint venture or development agreement or strategic partnership or similar agreement approved by the Company’s board of directors, a primary purpose of which is not to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactions.raise equity capital,

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 (including such date) (until the "Blockout Period")Effective Date, the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' ’ equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "“Subsequent Placement"”). (b) From the Effective Date until 30 Trading Days after the Effective Date (the “Blockout Period”), the Company will not, directly or indirectly, effect any Subsequent Placement except as set forth in Section 4.5(e). (c) The Blockout Period set forth in Section 4.5(b) above shall be extended for the number of Trading Days during such period in which (i) trading in the Common Stock is suspended by any Trading Market, (ii) the Registration Statement is not effective, or (iii) the prospectus included in the Registration Statement may not be used by the Purchasers for the resale of Registrable Securities thereunder. (d) From the end of the Blockout Period until the one (1) year anniversary of the Blockout Periodthereof, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b4.5(d). (i) The Company shall deliver to each Purchaser a written notice (the "Offer") of any proposed or intended issuance or sale or exchange of the securities being offered (the "“Offered Securities"”) in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons Persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty percent (40%) of the Offered Securities, in each case Securities based on such Purchaser's ’s pro rata portion of the aggregate purchase price paid by the Purchasers for all of the Shares purchased hereunder (the "Basic Amount"), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "“Undersubscription Amount"”). (ii) To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to the Company prior to the end of the five ten (510) Trading Day period of the Offer, setting forth the portion of the Purchaser's Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "Notice of Acceptance"). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "“Available Undersubscription Amount"”), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen five (155) days Trading Days from the expiration of the period set forth in Section 4.1(b)(ii4.5(d)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "Refused Securities"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person Person or persons Persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii4.5(d)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii4.5(d)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii4.5(c)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i4.5(d)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv4.5(d)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company Purchasers and their respective counsel. Notwithstanding anything to the contrary contained in this Agreement, if the Company does not consummate the closing of the issuance, sale or exchange of all or less than all of the Refused Securities within seven (7) Trading Days of the expiration of the period set forth in Section 4.5(d)(ii), the Company shall issue to the Purchasers the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.5(d)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. (vi) Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 4.1(b)(iii4.5(d)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (cvii) Notwithstanding anything herein to the contrarycontrary in this Section 4.5 and unless otherwise agreed to by the Purchasers, the Company shall either confirm in writing to the Purchasers that the transaction with respect to the Subsequent Placement has been abandoned or shall publicly disclose its intention to issue the Offered Securities, in either case in such a manner such that the Purchasers will not be in possession of material non-public information, by the 10th Trading Day following delivery of the Offer notice. If by the 10th Trading Day following the Offer notice no public disclosure regarding a transaction with respect to the Offered Securities has been made, and no notice regarding the abandonment of such transaction has been received by the Purchasers, such transaction shall be deemed to have been abandoned and the Purchasers shall not be deemed to be in possession of any material non-public information with respect to the Company. Should the Company decide to pursue such transaction with respect to the Offered Securities, the Company shall provide each Purchaser with another Offer notice and each Purchaser will again have the right of participation set forth in this Section 4.5. The Company shall not be permitted to deliver more than four such Offer notices to the Purchasers in any 12 month period. (e) The restrictions contained in paragraph paragraphs (a), (b) and (bd) of this Section 4.5 shall not apply to (i) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactionsExcluded Stock.

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 until the effective date of the registration statement (including such datethe "Registration Statement") relating to the resale of the Shares and Warrant Shares (the "Blockout Period"), the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "Subsequent Placement"). (b) From the end of the Blockout Period until the one (1) year 12 month anniversary of the Blockout Periodthereof, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b3.12(b). (i) The Company shall deliver to each Purchaser a written notice (the "Offer") of any proposed or intended issuance or sale or exchange of the securities being offered (the "Offered Securities") in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty percent (40%) 50% of the Offered Securities, in Securities equal to (A) the aggregate purchase price paid by each case based on such Purchaser's pro rata portion of Purchaser divided by (B) the aggregate purchase price paid by the Purchasers for all of the Shares purchased hereunder (the "Basic Amount"), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "Undersubscription Amount"). (ii) To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to the Company prior to the end of the five (5) Trading Day period of the Offer, setting forth the portion of the Purchaser's Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "Notice of Acceptance"). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "Available Undersubscription Amount"), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen ten (1510) days Trading Days from the expiration of the period set forth in Section 4.1(b)(ii3.12(b)(ii) above (the "Subsequent Placement Closing Period") to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "Refused Securities"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person or persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii3.12(b)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii3.12(b)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii3.12(b)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i3.12(b)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv3.12(b)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in the form and substance to the Purchasers, proposed by the Company and their respective counselfor use in connection with the sale of any Refused Securities. (vi) Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 4.1(b)(iii3.12(b)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (c) Notwithstanding anything herein to the contrary, the The restrictions contained in paragraph paragraphs (a) and (b) of this Section shall not apply to Excluded Stock. "Excluded Stock" means (i) the granting of stock options securities issued pursuant to employees, officers and directors a bona fide firm underwritten public offering of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance Company's securities with an aggregate initial public offering price of Common Stock upon exercise of such optionsat least $2,000,000 with a nationally recognized underwriter, (ii) securities issued pursuant to the terms of this Agreement or pursuant to the conversion or exercise of convertible or exercisable securities issued or outstanding on or prior to the date hereof provided that the terms of such securities have not changed after the date hereof, (iii) securities issued in connection with strategic license agreements or other partnering arrangements so long as such issuances are not for the purpose of raising capital, (iv) the issuance of shares of Common Stock or the issuance or grants of options to officers or employees purchase shares of Common Stock pursuant to any the Company's stock option plans and employee stock purchase plan plans as they now exist, (v) the Warrant Shares, (vi) securities issued (other than for cash) in connection with a merger, acquisition or similar plan designed to provide equity compensation to employees consolidation of the Company, (iiivii) any warrants issued to the placement agent for the transactions contemplated by this Agreement, (viii) any securities issued upon the conversion or exercise of any other securities issued in a Subsequent Placement provided that the terms of such securities have not changed, (ix) the issuance sale of up to $500,000 of Common Stock to providers on substantially the same terms of goods or services to this Agreement and (x) a warrant exchange between the Company and the holders of warrants issued in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactionsconnection with the Company's initial public offering in 2000.

Subsequent Placements. From the date hereof until the 30 day anniversary of the date hereof, neither the Company nor any subsidiary of the Company shall (ai) Except for issue, enter into any agreement to issue or announce the issuance or proposed issuance of any shares of Common Stock pursuant to Section 1(c), from the date hereof through April 15, 2003 (including such date) (the "Blockout Period"), or any securities of the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option subsidiaries which would entitle the holder thereof to purchase or other disposition of) any of its or the Subsidiaries' equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, acquire at any time during its life and under any circumstancesshares of Common Stock, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "Subsequent Placement"). (b) From the end of the Blockout Period until the one (1) year anniversary of the Blockout Period, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b). (i) The Company shall deliver to each Purchaser a written notice (the "Offer") of any proposed or intended issuance or sale or exchange of the securities being offered (the "Offered Securities") in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty percent (40%) of the Offered Securities, in each case based on such Purchaser's pro rata portion of the aggregate purchase price paid by the Purchasers for all of the Shares purchased hereunder (the "Basic Amount"), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "Undersubscription Amount"). (ii) To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to the Company prior to the end of the five (5) Trading Day period of the Offer, setting forth the portion of the Purchaser's Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "Notice of Acceptance"). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "Available Undersubscription Amount"), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen (15) days from the expiration of the period set forth in Section 4.1(b)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "Refused Securities"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) any debt, preferred stock, right, option, warrant or other instrument that are not more favorable is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to the acquiring person receive, shares of Common Stock, or persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii) above prior to such reduction) and (ii) file any registration statement, or amendment or supplement thereto, with the denominator of which shall be Commission other than those filed pursuant to this agreement or Other Warrant Exercised Agreements executed by Other Holders. Notwithstanding the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptanceforegoing, the Company may foregoing shall not issue, sell or exchange more than apply in respect of an Exempt Issuance. “Exempt Issuance” means the reduced number or amount issuance of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company and their respective counsel. (vi) Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 4.1(b)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (c) Notwithstanding anything herein to the contrary, the restrictions contained in paragraph (a) and (b) shares of this Section shall not apply to (i) the granting of stock Common Stock or options to employees, officers and or directors of the Company pursuant to any stock or option plan duly adopted for such purpose, by a majority of the Company 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 for services rendered to the Company, provided, however, such issuance shall not exceed ten percent (10%) of the shares of Common Stock upon exercise issued and outstanding as of such optionsthe date hereof, (iib) securities upon the issuance 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 officers increase the number of such securities or employees to decrease the exercise price, exchange price or conversion price of such securities (other than in connection with stock splits or combinations) or to extend the term of such securities, and (c) securities issued pursuant to any employee stock purchase plan acquisitions or similar plan designed to provide equity compensation to employees strategic transactions approved by a majority of the disinterested directors of the Company, provided that such securities are issued as “restricted securities” (iiias defined in Rule 144) and carry no registration rights that require or permit the filing of any registration statement in connection therewith, and provided that any such issuance shall only be to a Person (or to the equityholders of Common Stock to providers a Person) which is, itself or through its subsidiaries, an operating company or an owner of goods or services an asset in a business synergistic with the business of the Company and shall provide to the Company additional benefits in compensation addition to the investment of funds, but shall not include a transaction in which the Company is issuing securities primarily for such goods the purpose of raising capital or services, or (iv) licensing transactions and transactions that are primarily strategic transactionsto an entity whose primary business is investing in securities.

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 (including such date) until the Effective Date (the "Blockout PeriodBLOCKOUT PERIOD"), the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "Subsequent PlacementSUBSEQUENT PLACEMENT"). (b) The Blockout Period set forth in the preceding paragraph (a) shall be extended for the number of Trading Days during such period in which (i) trading in the Common Stock is suspended by any Trading Market, (ii) the Registration Statement is not effective, or (iii) the prospectus included in the Registration Statement may not be used by the Purchasers for the resale of Registrable Securities thereunder. (c) From the end of the Blockout Period until the one (1) year anniversary of the Blockout Periodthereof, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b4.5(c). (i) The Company shall deliver to each Purchaser a written notice (the "OfferOFFER") of any proposed or intended issuance or sale or exchange of the securities being offered (the "Offered SecuritiesOFFERED SECURITIES") in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons Persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to on the period from same terms as those set forth in the end of the Blockout Period until the seven month anniversary of the Blockout Period, Subsequent Placement a pro pro-rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty fifty percent (4050%) of the Offered Securities, in each case based on such Purchaser's pro rata portion of the aggregate purchase price paid by the Purchasers for all of the Shares purchased hereunder (the "Basic AmountBASIC AMOUNT"), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "Undersubscription AmountUNDERSUBSCRIPTION AMOUNT"). (ii) To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to subscription agreement or other subscription document in accordance with the Company terms of the offering for such Subsequent Placement prior to the end of the five ten (510) Trading Day period of the Offer, setting forth the portion of the Purchaser's Basic Amount that such Purchaser elects to purchase (the "SUBSCRIPTION AGREEMENT") and, if such Purchaser shall elect to purchase all of its Basic Amount, a written notice setting forth the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "Notice of AcceptanceNOTICE OF ACCEPTANCE"). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed forfor by submitting an additional Subscription Agreement for such Undersubscription Amount; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "Available Undersubscription AmountAVAILABLE UNDERSUBSCRIPTION AMOUNT"), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. A Purchaser may subscribe for Offered Securities in addition to a Purchaser's Basic Amount of such Offered Securities and its pro rata share of any Available Undersubscription Amount of such Offered Securities (such additional Offered Securities being referred to herein as the "ADDITIONAL AMOUNT"), by submitting a Subscription Agreement with respect to such Additional Amount in accordance with the terms of the offering of such Offered Securities prior to the expiration of the offering period of such Subsequent Placement. (iii) The Company shall have fifteen (15) days from the expiration of the period set forth in Section 4.1(b)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "Refused Securities"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person or persons or less favorable to If the Company than those set forth in closes the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all Offered Securities in accordance with the terms of the Refused SecuritiesSubsequent Placement, the Purchasers shall acquire from the Company, and then the Company shall issue be required to accept at such closing each Purchaser's Subscription Agreements with respect to its Basic Amount and its pro rata share of the PurchasersAvailable Undersubscription Amount, if any, and may, but shall not be required to, accept such Purchaser's Subscription Agreement with respect to any Additional Amount, all in accordance with the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv) above if the Purchasers have so elected, upon the same terms and conditions specified of sales of Offered Shares to third party purchasers in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company and their respective counselSubsequent Placement. (vid) Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 4.1(b)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (c) Notwithstanding anything herein to the contrary, the The restrictions contained in paragraph paragraphs (a) and (bc) of this Section shall not apply to (i) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactionsExcluded Stock.

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 (including such date) until 30 Trading Days following the Effective Date (the "Blockout PeriodBLOCKOUT PERIOD"), the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock Equity or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "Subsequent PlacementSUBSEQUENT PLACEMENT")., except as described in clause (D) of the definition of "Excluded Stock" (b) The Blockout Period set forth in the preceding paragraph (a) shall be extended for the number of Trading Days during such period in which (i) trading in the Common Stock is suspended by any Trading Market, (ii) the Registration Statement is not effective, or (iii) the prospectus included in the Registration Statement may not be used by the Purchasers for the resale of Registrable Securities thereunder. (c) From the end Blockout Period and for so long as a Purchaser holds any of the Blockout Period until the one (1) year anniversary of the Blockout PeriodShares, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b4.7(c). (i) The Company shall deliver to each Purchaser a written notice (the "OfferOFFER") of any proposed or intended issuance or sale or exchange of the securities being offered (the "Offered SecuritiesOFFERED SECURITIES") in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons Persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty fifty percent (4050%) of the Offered Securities, in each case based on such Purchaser's pro rata portion of the aggregate purchase price paid by the Purchasers for all of the Shares purchased hereunder (the "Basic AmountBASIC AMOUNT"), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "Undersubscription AmountUNDERSUBSCRIPTION AMOUNT"). (ii) To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to the Company prior to the end of the five (5) tenth Trading Day period from the delivery of the Offer, setting forth the portion of the Purchaser's Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "Notice of AcceptanceNOTICE OF ACCEPTANCE"). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Undersubscription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "Available Undersubscription AmountAVAILABLE UNDERSUBSCRIPTION AMOUNT"), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen thirty (1530) days from the expiration of the period set forth in Section 4.1(b)(ii4.7(c)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "Refused SecuritiesREFUSED SECURITIES"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person Person or persons Persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii4.7(c)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii4.7(c)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii4.7(c)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i4.7(c)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv4.7(c)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company Purchasers and their respective counsel. (vi) Any Offered Securities not acquired by the Purchasers or other persons Persons in accordance with Section 4.1(b)(iii4.7(c)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (cd) Notwithstanding anything herein to the contrarycontrary in this Section 4.7, no Purchaser shall have the right pursuant to this Section 4.7 to purchase in excess of the lesser of 10% or $25 million of Offered Securities in any single firm commitment underwritten public offering by the Company. In addition, the restrictions contained in paragraph (a) and (bc) of this Section shall not apply to (i) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactions.Excluded Stock

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 (including such date) until 30 Trading Days after the Effective Date (the "“Blockout Period"”), the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "“Subsequent Placement"”), except as set forth in Section 4.5(e). (b) [Reserved] (c) Following the Effective Date, the Blockout Period set forth in Section 4.5(a) above shall be extended for the number of Trading Days during such period in which (i) trading in the Common Stock is suspended by any Trading Market, (ii) the Registration Statement is not effective, or (iii) the prospectus included in the Registration Statement may not be used by the Purchasers for the resale of Registrable Securities thereunder. (d) From the end of the Blockout Period until the one (1) year anniversary of the Blockout Periodthereof, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b4.5(d), except as set forth in Section 4.5(e). (i) The Company shall deliver to each Purchaser a written notice (the "“Offer"”) of any proposed or intended issuance or sale or exchange of the securities being offered (the "“Offered Securities"”) in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty percent (40%) 30% of the Offered Securities, in each case Securities based on such Purchaser's ’s pro rata portion of the aggregate purchase price paid by the Purchasers for all of the Company Shares purchased hereunder (the "“Basic Amount"”), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "“Undersubscription Amount"”). (ii) To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to the Company prior to the end of the five seven (57) Trading Day period of the Offer, setting forth the portion of the Purchaser's ’s Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "“Notice of Acceptance"”). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "“Available Undersubscription Amount"”), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen five (155) days Trading Days from the expiration of the period set forth in Section 4.1(b)(ii4.5(d)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "“Refused Securities"”), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person or persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii4.5(d)(iii) above), then each Purchaser may, at its sole option within 1 Trading Day after written notice thereof and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii4.5(d)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii4.5(d)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i4.5(d)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv4.5(d)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company Purchasers and their respective counsel. (vi) Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 4.1(b)(iii4.5(d)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (ce) Notwithstanding anything herein to the contrary, the The restrictions contained in paragraph paragraphs (a) and (bd) of this Section 4.5 shall not apply to (iA) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock or grant of Options to employees, officers, directors of or consultants or advisors to the Company, in each case, pursuant to a stock-based plan duly approved by the Company’s board of directors; (B) upon exercise, conversion or exchange of any Common Stock Equivalents described in Schedule 3.1(f) (provided that such exercise of such optionsor conversion occurs in accordance with the terms thereof, without amendment or modification); (iiC) the issuance of Common Stock to officers or employees securities pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company’s bona fide acquisition of another corporation, or all or a portion of its assets, by merger, purchase of assets or stock or other corporate reorganization in each case, as approved by the Company’s board of directors and not for the principal purpose of raising cash; (iiiD) the issuance of Common Stock securities in connection with a bona fide joint venture or development agreement or strategic partnership or similar agreement approved by the Company’s board of directors, a primary purpose of which is not to providers of goods raise equity capital; or services (E) any bona-fide underwritten public offering with an underwriter with proceeds to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactionsexcess of $20 million.

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 (including such date) (until the "Blockout Period")Effective Date, the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "Subsequent PlacementSUBSEQUENT PLACEMENT"). (b) From the Effective Date until 30 Trading Days after the Effective Date (the "BLOCKOUT PERIOD"), the Company will not, directly or indirectly, effect any Subsequent Placement except as set forth in Section 4.5(e). (c) The Blockout Period set forth in Section 4.5(b) above shall be extended for the number of Trading Days during such period in which (i) trading in the Common Stock is suspended by any Trading Market, (ii) the Registration Statement is not effective, or (iii) the prospectus included in the Registration Statement may not be used by the Purchasers for the resale of Registrable Securities thereunder. (d) From the end of the Blockout Period until 180 Trading Days from the one (1) year anniversary of the Blockout PeriodEffective Date, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b4.5(d). (i) The Company shall deliver to each Purchaser a written notice (the "OfferOFFER") of any proposed or intended issuance or sale or exchange of the securities being offered (the "Offered SecuritiesOFFERED SECURITIES") in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons Persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty percent (40%) of the Offered Securities, in each case Securities based on such Purchaser's pro rata portion of the aggregate purchase price paid by the Purchasers for all of the Shares purchased hereunder (the "Basic AmountBASIC AMOUNT"), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "Undersubscription AmountUNDERSUBSCRIPTION AMOUNT"). (ii) To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to the Company prior to the end of the five (5) Trading Day period of the Offer, setting forth the portion of the Purchaser's Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "Notice of AcceptanceNOTICE OF ACCEPTANCE"). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; providedPROVIDED, howeverHOWEVER, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "Available Undersubscription AmountAVAILABLE UNDERSUBSCRIPTION AMOUNT"), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen five (155) days Trading Days from the expiration of the period set forth in Section 4.1(b)(ii4.5(d)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "Refused SecuritiesREFUSED SECURITIES"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person Person or persons Persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii4.5(d)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii4.5(d)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii4.5(c)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i4.5(d)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv4.5(d)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company Purchasers and their respective counsel. (vi) Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 4.1(b)(iii4.5(d)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (ce) Notwithstanding anything herein to the contrary, the The restrictions contained in paragraph paragraphs (a), (b) and (bd) of this Section 4.5 shall not apply to (i) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactionsExcluded Stock.

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 (including such date) (until the "Blockout Period")Effective Date, the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Significant Subsidiaries' ’ equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents Equivalents, but not including any Excluded Stock, (any such offer, sale, grant, disposition or announcement being referred to as a "“Subsequent Placement"”), except as permitted by this Section 4.5. (b) From the end of the Blockout Period Effective Date until the one (1) year anniversary of the Blockout Periodthereof, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b4.5(b). (i) The Company shall deliver to each Purchaser a written notice (the "“Offer"”) of any proposed or intended issuance or sale or exchange of the securities being offered (the "“Offered Securities"”) in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty fifty percent (4050%) of the Offered Securities, in each case Securities based on such Purchaser's ’s pro rata portion of the aggregate purchase price paid by the Purchasers for all of the Shares purchased hereunder (the "“Basic Amount"”), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "“Undersubscription Amount"”). (ii) To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to the Company prior to the end of the five (5) Trading Day period of the Offer, setting forth the portion of the Purchaser's ’s Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "“Notice of Acceptance"”), provided that the Purchaser may also give a Notice of Acceptance at anytime prior to the date that is 10 days prior to the closing of such Subsequent Placement. If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Undersubscription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "“Available Undersubscription Amount"”), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen (15) days 120 Trading Days from the expiration of the five Trading Day period set forth in Section 4.1(b)(ii4.5(b)(ii) above to issue, sell or exchange (or any binding commitment thereto) all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "“Refused Securities"”), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person or persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii4.5(b)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii4.5(b)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii4.5(b)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i4.5(b)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv4.5(b)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company Purchasers and their respective counsel. (vi) Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 4.1(b)(iii4.5(b)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (c) Notwithstanding anything herein to the contrary, the The restrictions contained in paragraph (a) and (b) of this Section 4.5 shall not apply to (i) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactionsExcluded Stock.

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant Subject to Section 1(c4.7(c) and (d), from the date hereof through April 15the 90th Trading Day following the Effective Date, 2003 (including such date) (other than to the "Blockout Period")Purchasers or the Initial Investors, the Company will not, directly or indirectly, : (i) offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition ofdisposition) any of its or the Subsidiariesits Affiliates' equity or equity equivalent securities, securities (including without limitation the issuance of any debt, preferred stock debt or other instrument or security that is, at any time during its over the life and under any circumstances, thereof convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "Subsequent Placement")) or (ii) file a registration statement (other than on a Form S-8 and pursuant to the Registration Rights Agreement) with the Commission with respect to any securities of the Company. (b) From Subject to Section 4.7(c) and (d), from the end date hereof until the expiration of the Blockout Period until 180th Trading Day after the one (1) year anniversary of the Blockout PeriodEffective Date, the Company will shall not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b). unless: (i) The the Company shall deliver delivers to each Purchaser of the Purchasers a written notice (the "OfferSubsequent Placement Notice") of any proposed or intended issuance or sale or exchange of the securities being offered (the "Offered Securities") in a its intention to effect such Subsequent Placement, which Offer Subsequent Placement Notice shall (w) identify and describe in reasonable detail the Offered Securitiesproposed terms of such Subsequent Placement, (x) describe the price and other terms upon which they are amount of proceeds intended to be issuedraised there under, sold the Person with whom such Subsequent Placement shall be effected, and attached to which shall be a term sheet or exchangedsimilar document relating thereto and (ii) such Purchaser shall not have notified the Company by 6:30 p.m. (New York City time) on the tenth Trading Day after its receipt of the Subsequent Placement Notice of its willingness to provide (or to cause its sole designee to provide), subject to completion of mutually acceptable documentation, financing to the Company on the same terms set forth in the Subsequent Placement Notice. If the Purchasers shall fail to notify the Company of their intention to enter into such negotiations within such time period, the Company may effect the Subsequent Placement substantially upon the terms and to the Persons (or Affiliates of such Persons) set forth in the Subsequent Placement Notice; provided, that the Company shall provide the Purchasers with a second Subsequent Placement Notice, and the number or amount Purchasers shall again have the right of first refusal set forth above in this paragraph (a), if the Subsequent Placement subject to the initial Subsequent Placement Notice shall not have been consummated for any reason on the terms set forth in such Subsequent Placement Notice within 45 Trading Days after the date of the Offered Securities initial Subsequent Placement Notice with the Person (or an Affiliate of such Person) identified in the Subsequent Placement Notice. If the Purchasers shall indicate a willingness to be issuedprovide financing in excess of the amount set forth in the Subsequent Placement Notice, sold or exchanged, (y) identify the persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with then each Purchaser (A) (1) with respect shall be entitled to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect provide financing pursuant to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of such Subsequent Placement Notice up to an amount equal to forty percent (40%) of the Offered Securities, in each case based on such Purchaser's pro pro-rata portion of the aggregate purchase price paid number of Shares purchased by such Purchaser under this Agreement, but the Company shall not be required to accept financing from the Purchasers for all in an amount in excess of the Shares purchased hereunder (the "Basic Amount"), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "Undersubscription Amount"). (ii) To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to the Company prior to the end of the five (5) Trading Day period of the Offer, setting forth the portion of the Purchaser's Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "Notice of Acceptance"). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "Available Undersubscription Amount"), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen (15) days from the expiration of the period set forth in Section 4.1(b)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "Refused Securities"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person or persons or less favorable to the Company than those amount set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company and their respective counsel. (vi) Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 4.1(b)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this AgreementSubsequent Placement Notice. (c) Notwithstanding anything herein to the contrary, the The restrictions contained in paragraph (aSection 4.7(a) and (b) of this Section shall not apply to (i) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options. (d) The restrictions contained in Section 4.7(a)and (b) shall be extended for any number of Trading Days during such period in which: (i) trading in the Common Stock is suspended by any Trading Market, or (ii) the issuance of Common Stock to officers Underlying Shares Registration Statement is not effective or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance prospectus included in the Underlying Shares Registration Statement may not be used by the Purchasers for the resale of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactionsRegistrable Securities there under.

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 (including such date) until 30 Trading Days following the Effective Date (the "“Blockout Period"”), the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' ’ equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "“Subsequent Placement"”). (b) The Blockout Period set forth in the preceding paragraph (a) shall be extended for the number of Trading Days during such period in which (i) trading in the Common Stock is suspended by any Trading Market, (ii) the Registration Statement is not effective, or (iii) the prospectus included in the Registration Statement may not be used by the Purchasers for the resale of Registrable Securities thereunder. (c) From the end of the Blockout Period Closing Date until the one (1) year anniversary of the Blockout Periodthereof, the Company will not, directly or indirectly, effect any Subsequent Placement (other than a registered offering of shares of Common Stock) unless the Company shall have first complied with this Section 4.1(b4.5(c). (i) The Company shall deliver to each Purchaser that has purchased at least 1,000,000 Shares hereunder (each a “Substantial Purchaser”) a written notice (the "“Offer"”) of any proposed or intended issuance or sale or exchange of the securities being offered (the "“Offered Securities"”) in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify identify, to the persons extent known, the Persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each such Substantial Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro pro-rata portion of 33% of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty percent (40%) of the Offered Securities, in each case based on such Substantial Purchaser's ’s pro rata portion of the aggregate purchase price paid by the all Substantial Purchasers for all of the Shares purchased hereunder by the Substantial Purchasers (the "“Basic Amount"”), and (B) with respect to each Substantial Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Substantial Purchasers as such Substantial Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "“Undersubscription Amount"”). (ii) To accept an Offer, in whole or in part, a Substantial Purchaser must deliver a written notice to the Company prior to the end of the five (5) two Trading Day period of the Offer, setting forth the portion of the Purchaser's ’s Basic Amount that such Substantial Purchaser elects to purchase and, if such Substantial Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Substantial Purchaser elects to purchase (in either case, the "“Notice of Acceptance"”). If the Basic Amounts subscribed for by all Substantial Purchasers are less than the total of all of the Basic Amounts, then each Substantial Purchaser who has set forth an Undersubcription Undersubscription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "“Available Undersubscription Amount"”), each Substantial Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Substantial Purchaser bears to the total Basic Amounts of all Substantial Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen (15) days from the expiration of the period set forth in Section 4.1(b)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "Refused Securities"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person or persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Offered Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii4.5(c)(i) above), then each Substantial Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Substantial Purchaser elected to purchase pursuant to Section 4.1(b)(ii4.5(c)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Substantial Purchasers pursuant to Section 4.1(b)(ii4.5(c)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Substantial Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Substantial Purchasers in accordance with Section 4.1(b)(i4.5(c)(i) above. (viv) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Offered Securities, the Substantial Purchasers shall acquire from the Company, and the Company shall issue to the Substantial Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv4.5(c)(iv) above if the Substantial Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Substantial Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Substantial Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company Substantial Purchasers and their respective counsel. (viv) Any Offered Securities not acquired by the Substantial Purchasers or other persons Persons in accordance with Section 4.1(b)(iii4.5(c)(iii) above may not be issued, sold or exchanged until they are again offered to the Substantial Purchasers under the procedures specified in this Agreement. (cd) Notwithstanding anything herein to the contrary, the The restrictions contained in paragraph paragraphs (a) and (bc) of this Section shall not apply to (i) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactionsExcluded Stock.

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 (including such date) (until the "Blockout Period")Effective Date, the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "Subsequent Placement"). (b) From the Effective Date until 30 Trading Days after the Effective Date (the "Blockout Period"), the Company will not, directly or indirectly, effect any Subsequent Placement except as set forth in Section 4.6(e). (c) The Blockout Period set forth in Section 4.6(b) above shall be extended for the number of Trading Days during such period in which (i) trading in the Common Stock is suspended by any Trading Market, (ii) the Registration Statement is not effective, or (iii) the prospectus included in the Registration Statement may not be used by the Purchasers for the resale of Registrable Securities thereunder. (d) From the end of the Blockout Period until and for so long as the one (1) year anniversary of the Blockout PeriodNotes are outstanding, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b4.6(d). (i) The Company shall deliver to each Purchaser a written notice (the "Offer") of any proposed or intended issuance or sale or exchange of the securities being offered (the "Offered Securities") in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons Persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty percent (40%) of the Offered Securities, in each case Securities based on such Purchaser's pro rata portion of the aggregate purchase price paid by the Purchasers for all principal amount of the Shares Notes purchased hereunder (the "Basic Amount"), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "Undersubscription Amount"). (ii) To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to the Company prior to the end of the five (5) 10 Trading Day period of the Offer, setting forth the portion of the Purchaser's Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "Notice of Acceptance"). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "Available Undersubscription Amount"), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen five (155) days Trading Days from the expiration of the period set forth in Section 4.1(b)(ii4.6(d)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "Refused Securities"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person Person or persons Persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii4.6(d)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii4.6(d)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii4.6(c)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i4.6(d)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv4.6(d)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company Purchasers and their respective counsel. (vi) Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 4.1(b)(iii4.6(d)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (ce) Notwithstanding anything herein to the contrary, the The restrictions contained in paragraph paragraphs (ab) and (bd) of this Section 4.6 shall not apply to (i) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactionsExcluded Stock.

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 (including such date) until the Effective Date (the "Blockout Period"), the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "Subsequent Placement"). (b) From the end of the Blockout Period until the one (1) year anniversary of 90th Trading Day from the Blockout PeriodEffective Date, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b4.5(b). (i) The Company shall deliver to each Purchaser a written notice (the "Offer") of any proposed or intended issuance or sale or exchange of the securities being offered (the "Offered Securities") in a Subsequent Placement, which Offer shall (v) include an email address to which the Purchasers may transmit the Notice of Acceptance (as defined below); (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons or entities (if known) Persons to which or with which the Offered Securities are to be offered, issued, sold or exchanged (unless restricted by a confidentiality agreement, in which case the Company will include a reasonably detailed description of type and nature of such Persons), and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the greater of (1) all of such Offered Securities, but not more than an aggregate of $5,000,000 of such Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary 25% of the Blockout Period, a pro rata portion of an amount equal to forty percent (40%) of the such Offered Securities, in each case based on such Purchaser's pro rata portion of the aggregate purchase price paid by the Purchasers for all of the Shares purchased hereunder (the "Basic Amount"), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "Undersubscription Amount"). (ii) To accept an Offer, in whole or in part, a Purchaser must promptly (and in any event not later than the later of (x) 6:30 p.m.( New York City time) on the day after the day on which the Offer is received by such Purchaser and (y) 24 hours from the time the Offer is received by such Purchaser) deliver a written notice to the Company prior to the end of the five (5) Trading Day period of the Offer, setting forth the portion of the Purchaser's Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "Notice of Acceptance"). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Undersubscription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the -------- ------- difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "Available Undersubscription Amount"), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) The Company shall have fifteen (15) days three Trading Days from the expiration of the period set forth in Section 4.1(b)(ii4.5(b)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "Refused Securities"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person Person or persons Persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii4.5(b)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii4.5(b)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii4.5(b)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i4.5(b)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv4.5(b)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company Purchasers and their respective counsel. (vi) Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 4.1(b)(iii4.5(b)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (c) Notwithstanding anything herein to the contrary, the The restrictions contained in paragraph paragraphs (a) and (b) of this Section 4.5 shall not apply to (i) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactionsExcluded Stock.

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 (including such date) (until the "Blockout Period")Effective Date, the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or agree to do any of the foregoing) (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' ’ equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "“Subsequent Placement"”). . From the Effective Date until 30 Trading Days after the Effective Date (bthe “Blockout Period”), the Company will not, directly or indirectly, effect any Subsequent Placement, except with regard to Excluded Stock. The Blockout Period set forth in Section 4.5(b) above shall be extended for the number of Trading Days during such period in which (i) trading in the Common Stock is suspended by any Trading Market, (ii) the Registration Statement is not effective, or (iii) the prospectus included in the Registration Statement may not be used by the Purchasers for the resale of Registrable Securities thereunder. From the end of the Blockout Period until the one (1) year seven month anniversary of the Blockout Periodthereof, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b4.5(d). (i) . The Company shall deliver to each Purchaser a written notice (the "“Offer"”) of any proposed or intended issuance or sale or exchange of the securities being offered (the "“Offered Securities"”) in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to the period from the end of the Blockout Period until the seven month anniversary of the Blockout Period, a pro rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty percent (40%) of the Offered Securities, in each case Securities based on such Purchaser's ’s pro rata portion of the aggregate purchase price paid by the Purchasers for all of the Shares purchased hereunder (the "“Basic Amount"”), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "“Undersubscription Amount"”). (ii) . To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to the Company prior to the end of the five ten (510) Trading Day period of the Offer, setting forth the portion of the Purchaser's ’s Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount, the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "“Notice of Acceptance"”). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Undersubscription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "“Available Undersubscription Amount"”), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on only that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. (iii) . The Company shall have fifteen five (155) days Trading Days from the expiration of the period set forth in Section 4.1(b)(ii4.5(d)(ii) above to issue, sell or exchange (or any binding commitment thereto) all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "Refused Securities"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person or persons or less favorable to the Company than those set forth in the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company and their respective counsel. (vi) Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 4.1(b)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (c) Notwithstanding anything herein to the contrary, the restrictions contained in paragraph (a) and (b) of this Section shall not apply to (i) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactions.the

Subsequent Placements. (a) Except for the issuance of Common Stock pursuant to Section 1(c), from From the date hereof through April 15, 2003 (including such date) until the Effective Date (the "“Blockout Period"”), the Company will not, directly or indirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or the Subsidiaries' ’ equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is, at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for Common Stock or Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "“Subsequent Placement"”). (b) The Blockout Period set forth in the preceding paragraph (a) shall be extended for the number of Trading Days during such period in which (i) trading in the Common Stock is suspended by any Trading Market, (ii) the Registration Statement is not effective, or (iii) the prospectus included in the Registration Statement may not be used by the Purchasers for the resale of Registrable Securities thereunder. (c) From the end of the Blockout Period until the one (1) year anniversary of the Blockout Periodthereof, the Company will not, directly or indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.1(b4.5(c). (i) The Company shall deliver to each Purchaser a written notice (the "“Offer"”) of any proposed or intended issuance or sale or exchange of the securities being offered (the "“Offered Securities"”) in a Subsequent Placement, which Offer shall (w) identify and describe the Offered Securities, (x) describe the price and other terms upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged, (y) identify the persons Persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged and (z) offer to issue and sell to or exchange with each Purchaser (A) (1) with respect to on the period from same terms as those set forth in the end of the Blockout Period until the seven month anniversary of the Blockout Period, Subsequent Placement a pro pro-rata portion of the Offered Securities, and (2) with respect to the period from the seven month anniversary until the one year anniversary of the Blockout Period, a pro rata portion of an amount equal to forty fifty percent (4050%) of the Offered Securities, in each case based on such Purchaser's ’s pro rata portion of the aggregate purchase price paid by the Purchasers for all of the Shares purchased hereunder (the "“Basic Amount"”), and (B) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other Purchasers subscribe for less than their Basic Amounts (the "“Undersubscription Amount"”). (ii) To accept an Offer, in whole or in part, a Purchaser must deliver a written notice to subscription agreement or other subscription document in accordance with the Company terms of the offering for such Subsequent Placement prior to the end of the five ten (510) Trading Day period of the Offer, setting forth the portion of the Purchaser's ’s Basic Amount that such Purchaser elects to purchase (the “Subscription Agreement”) and, if such Purchaser shall elect to purchase all of its Basic Amount, a written notice setting forth the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "“Notice of Acceptance"”). If the Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an Undersubcription Undersubscription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the Undersubscription Amount it has subscribed forfor by submitting an additional Subscription Agreement for such Undersubscription Amount; provided, however, that if the Undersubscription Amounts subscribed for exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "“Available Undersubscription Amount"”), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase on that portion of the Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have subscribed for Undersubscription Amounts, subject to rounding by the Board of Directors to the extent its deems reasonably necessary. A Purchaser may subscribe for Offered Securities in addition to a Purchaser’s Basic Amount of such Offered Securities and its pro rata share of any Available Undersubscription Amount of such Offered Securities (such additional Offered Securities being referred to herein as the “Additional Amount”), by submitting a Subscription Agreement with respect to such Additional Amount in accordance with the terms of the offering of such Offered Securities prior to the expiration of the offering period of such Subsequent Placement. (iii) The Company shall have fifteen (15) days from the expiration of the period set forth in Section 4.1(b)(ii) above to issue, sell or exchange all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "Refused Securities"), but only to the offerees described in the Offer (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that are not more favorable to the acquiring person or persons or less favorable to If the Company than those set forth in closes the Offer. (iv) In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms specified in Section 4.1(b)(iii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the Offered Securities that the Purchaser elected to purchase pursuant to Section 4.1(b)(ii) above multiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities to be issued or sold to Purchasers pursuant to Section 4.1(b)(ii) above prior to such reduction) and (ii) the denominator of which shall be the original amount of the Offered Securities. In the event that any Purchaser so elects to reduce the number or amount of Offered Securities specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.1(b)(i) above. (v) Upon the closing of the issuance, sale or exchange of all or less than all Offered Securities in accordance with the terms of the Refused SecuritiesSubsequent Placement, the Purchasers shall acquire from the Company, and then the Company shall issue be required to accept at such closing each Purchaser’s Subscription Agreements with respect to its Basic Amount and its pro rata share of the PurchasersAvailable Undersubscription Amount, if any, and may, but shall not be required to, accept such Purchaser’s Subscription Agreement with respect to any Additional Amount, all in accordance with the number or amount of Offered Securities specified in the Notices of Acceptance, as reduced pursuant to Section 4.1(b)(iv) above if the Purchasers have so elected, upon the same terms and conditions specified of sales of Offered Shares to third party purchasers in the Offer. The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the Purchasers, the Company and their respective counselSubsequent Placement. (vid) Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 4.1(b)(iii) above may not be issued, sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement. (c) Notwithstanding anything herein to the contrary, the The restrictions contained in paragraph paragraphs (a) and (bc) of this Section shall not apply to (i) the granting of stock options to employees, officers and directors of the Company pursuant to any stock option plan duly adopted by the Company or to the issuance of Common Stock upon exercise of such options, (ii) the issuance of Common Stock to officers or employees pursuant to any employee stock purchase plan or similar plan designed to provide equity compensation to employees of the Company, (iii) the issuance of Common Stock to providers of goods or services to the Company in compensation for such goods or services, or (iv) licensing transactions and transactions that are primarily strategic transactionsExcluded Stock.