Exhibit 10.1

SECURITIES Purchase Agreement

This SECURITIES PURCHASE AGREEMENT (the “ Agreement ”) is made and entered into as of March 28, 2014 by and among Torvec, Inc., a New York corporation (the “ Company ”), B. Thomas Golisano, a resident of the State of Florida (the “ Investor ”), and each other Purchaser listed on the Schedule of Purchasers attached hereto (each along with the Investor, a “ Purchaser ” and collectively the “ Purchasers ”).

WHEREAS , the Company and the Purchasers are executing and delivering this Agreement in reliance upon the exemption from securities registration afforded by Section 4(2) of the Securities Act of 1933, as amended (the “ Securities Act ”), and Rule 506 of Regulation D (“ Regulation D ”) as promulgated by the United States Securities and Exchange Commission (the “ SEC ”) under the Securities Act;

WHEREAS , the Company has filed, or will file prior to the Closing, a Certificate of Amendment (“ Certificate of Amendment ”) to the Company’s Certificate of Incorporation, as amended through September 21, 2011 (collectively, the “ Certificate of Incorporation ”, and as amended by the Certificate of Amendment, the “ Amended Certificate of Incorporation ”) in the form attached hereto as Exhibit A-1 , which sets forth the rights, preferences, privileges, terms and provisions of the Company’s Series C-2 Voting Convertible Preferred Stock, par value $0.01 per share (the “ Convertible Preferred Shares ”); and

WHEREAS , the Purchasers desire to purchase from the Company, and the Company desires to issue and sell to the Purchasers, an aggregate of 25,000,000 Convertible Preferred Shares, initially convertible into an equivalent number of shares of the Company’s common stock, par value $0.01 per share (“ Common Stock ”), for an aggregate purchase price of at least $5,000,000 at a price of $0.20 per share, each in the respective amounts set forth next to each Purchaser’s name on the Schedule of Purchasers attached hereto;

WHEREAS , prior to the date hereof, the Company has received the requisite board of directors and shareholder approval for the filing of a Certificate of Amendment (the “ Series C-3 Amendment ”) to the Amended Certificate of Incorporation in the form attached hereto as Exhibit A-2 , subject, however, to the additional approval of a Special Committee of the Board of Directors, which sets forth the rights, preferences, privileges, terms and provisions of the Company’s Series C-3 Voting Convertible Preferred Stock, par value $0.01 per share (the “ Series C-3 Stock ”), and has received the requisite approvals and is preparing to conduct a private offering of up to $1,000,000 of the Series C-3 Stock in a private placement exempt from registration under Section 4(2) of the Securities Act and Rule 506 of Regulation D as promulgated by the SEC under the Securities Act (the “ Series C-3 Preferred Offering ”), as more particularly set forth in Section 6.1 below;

NOW THEREFORE , in consideration of the foregoing and the mutual covenants and agreements hereinafter set forth, the Company and each Purchaser hereto, severally and not jointly, agree as follows:

Section 1.      Purchase and Sale of Securities.

1.1     Sale and Purchase. Upon the terms and subject to the conditions herein, and in reliance on the representations and warranties made by the Company in this Agreement, each Purchaser hereby severally agrees to purchase from the Company, and the Company hereby agrees to issue and sell to each Purchaser at the Closing (defined in Section 1.4 below), free and clear of any and all Claims (as defined below) (other than those set forth herein and in the Amended and Restated Investors Rights Agreement) that number of Convertible Preferred Shares as set forth next to each Purchaser’s name on the Schedule of Purchasers attached hereto, for the aggregate purchase price set forth on the Schedule of Purchasers (the “ Purchase Price ”). The Convertible Preferred Shares shall have the rights, privileges and preferences contained in the Amended Certificate of Incorporation.

1.2     Amended Certificate of Incorporation. Immediately prior to or contemporaneously with the Closing, the Company shall have filed with the Secretary of State of New York the Certificate of Amendment, and the same shall have become effective prior to the Closing in accordance with New York law.

1.3     Use of Proceeds. The Company may use the proceeds from the sale of the Convertible Preferred Shares for general corporate purposes and the continued development and marketing of the Company's technology for commercialization.

1.4     Closing. The closing of the issuance, sale, transfer, assignment, conveyance and delivery of the Convertible Preferred Shares (the “ Closing ”) will take place at the offices of Woods Oviatt Gilman, LLP, Two State Street, Rochester New York 14614, at 10:00 a.m., on the date hereof (the “ Closing Date ”).

1.5      Closing Deliveries. At the Closing:

(a)     Each Purchaser shall deliver to the Company:

(i)      in United States dollars and in immediately available funds, the Purchase Price for the Convertible Preferred Shares purchased by the Purchaser by wire transfer to an account designated by the Company;

(ii)     the Amended and Restated Investors’ Rights Agreement in the form attached hereto as Exhibit B (the “ Amended and Restated Investors’ Rights Agreement ”), duly executed by such Purchaser; and

(iii)     such other supporting documents and certificates as the Company may reasonably request or as may be required pursuant to this Agreement or another Transaction Document in order to effect the transactions contemplated hereunder and thereunder.

(b)     The Company shall deliver or cause to be delivered to each Purchaser the following:

(i)     a stock certificate representing all of the Convertible Preferred Shares issued hereunder registered in the name of the Purchaser, which certificate(s) shall contain the restrictive legend required hereby and the Amended and Restated Investors’ Rights Agreement; and

(ii)     the Amended and Restated Investors’ Rights Agreement duly executed by the Company.

(c)     The Company shall deliver or cause to be delivered to the Investor the following:

(i)     certificate of the secretary or assistant secretary of the Company certifying, as of the Closing, as to (A) the Amended Certificate of Incorporation, (ii) the By-Laws of the Company as amended or amended and restated to date, (iii) the resolutions of the board of directors of the Company approving the Transaction Documents and the other documents to be delivered by the Company thereunder and the performance of the obligations of the Company thereunder and (iv) the resolutions of the holders of the Class A Non-Voting Cumulative Convertible Preferred Stock (as defined in Section 2.4(a)), the Class B Non-Voting Cumulative Convertible Preferred Stock (as defined in Section 2.4(a)), and the Existing Series C Preferred Stock (as defined in Section 2.4(a)), approving the content and filing of the Certificate of Amendment, and (v) the names and true signatures of the officers of the Company authorized to sign the Transaction Documents to be delivered by the Company under this Agreement and the other Transaction Documents;

(ii)     a certificate of the Secretary of State of the State of New York as of a recent date, as to the good standing of the Company and as to the Charter Documents of the Company on file in the office of the Secretary of State;

(iii)     the legal opinion of Richard Sullivan, Esq., general counsel for the Company, substantially in the form of Exhibit C hereto; and

(iv)     such other supporting documents and certificates as the Investor may reasonably request or as may be required pursuant to this Agreement or another Transaction Document.

1.6     Reservation of Shares. The Company has authorized and has reserved and covenants to continue to reserve out of its authorized Common Stock, free of preemptive rights and other similar contractual rights of stockholders, the maximum number of shares of Common Stock as shall from time to time be sufficient to effect the conversion of all of the Convertible Preferred Shares .

1.7     Transfer Taxes. All transfer taxes, fees and duties under applicable law incurred in connection with the sale and transfer of the Convertible Preferred Shares under this Agreement will be borne and paid by the Company and it shall promptly reimburse the Purchasers for any such tax, fee or duty which any of them is required to pay under applicable law.

1.8     Certain Definitions. For purposes of this Agreement, the following terms shall have the meanings given thereto :

(a)     “ Affiliate ” of a Person shall mean with respect to such a Person or entity, any Person or entity which directly or indirectly Controls, is Controlled by, or is under common Control with such Person or entity.

(b)     “ Claim ” shall mean any and all liens, claims, options, charges, pledges, security interests, voting agreements, voting trusts, encumbrances, rights or restrictions of any nature.

(c)      “ Control ” (including the terms “controlled by” and “under common control with”) means the possession, directly or indirectly, or as trustee or executor, of the power to direct or cause the direction of the management policies of a Person, whether through the ownership of stock, as trustee or executor, by contract or credit arrangement or otherwise.

(d)      “ Convertible Preferred Shares ” has the meaning given thereto in the recitals.

(e)      “ Conversion Shares ” means the shares of Common Stock issuable upon conversion of the Convertible Preferred Shares.

(f)       “ Draft Form 10-K ” means the draft Form 10-K of the Company for the fiscal year ended December 31, 2013.

(g)      “ Exchange Act ” means the Securities Exchange Act of 1934, as amended.

(h)    “ Existing Investors’ Rights Agreement ” means that certain Investors’ Rights Agreement dated September 23, 2011, by and among the Company, the Investor, Charles T. Graham and David Still (the Investor and Messrs. Graham and Still, each an “ Existing Investor ,” and together, the “ Existing Investors ”)

(i)      “ Existing Preferred Stock ” means collectively the Company’s outstanding Class A Non-Voting Cumulative Convertible Preferred Stock (as defined in Section 2.4(a)), Class B Non-Voting Cumulative Convertible Preferred Stock (as defined in Section 2.4(a)), and Existing Series C Preferred Stock (as defined in Section 2.4(a)).

(j)       “ GAAP ” means generally accepted accounting principles as applied in the United States.

(k)     “ Knowledge ” means the actual knowledge after reasonable investigation of Richard A. Kaplan, Robert Fishback, Richard Sullivan and Keith Gleasman.

(l)     “ Legal Requirements ” means all foreign, federal, state, municipal and local statutes, laws, ordinances, judgments, decrees, orders, rules, regulations, policies and guidelines;

(n)      “ Permitted Encumbrances ” means (i) real estate taxes, assessments and other governmental levies, fees, or charges imposed that are (x) not due and payable as of the Closing Date or (y) being contested by appropriate proceedings; (ii) mechanics’ liens and similar liens for labor, materials, or supplies provided for amounts that are (x) not delinquent or (y) being contested by appropriate proceedings (and, in either event, are not material); (iii) zoning, building codes, and other land use laws regulating the use or occupancy of real property or the activities conducted thereon that are imposed by any governmental authority having jurisdiction over real property; (iv) liens, security interest or other encumbrances for any publicly disclosed indebtedness of the Company or its Subsidiaries; and (v) easements, covenants, conditions, restrictions and other similar matters affecting title to real property and other encroachments and title and survey defects that do not or would not materially impair the use or occupancy of such real property in the operation of the business of the Company and its Subsidiaries taken as a whole.

(o)      “ Person ” means an individual, corporation, partnership, association, trust, any unincorporated organization or any other entity.

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

(q)      “ SEC Reports ” means all reports, schedules, forms, statements and other documents required to be filed with the SEC by the Company for the two year period prior to the Closing through and including through the date hereof, with the SEC pursuant to the reporting requirements of the Exchange Act, including all exhibits included or incorporated by reference therein and financial statements and schedules thereto and documents included or incorporated by reference therein.

(r)      “ Subsidiary ” of a Person means any corporation more than fifty (50%) percent of whose outstanding voting securities, or any partnership, limited liability company joint venture or other entity more than fifty percent (50%) of whose total equity interest, is directly or indirectly owned by such Person.

(s)     “ Transaction Documents ” means this Agreement, the Certificate of Amendment, and the Amended and Restated Investors’ Rights Agreement and each other agreement, document and instrument executed in connection with the transactions contemplated hereby or thereby.

1.9          Further Assurances . The Company, on the one hand, and each Purchaser, on the other hand, from time to time after the Closing at the request of the other and without further consideration shall execute and deliver further instruments of issuance, transfer and assignment and take such other action as the other may reasonably require to fully and more effectively transfer and assign to, and vest in, the Purchasers, the Convertible Preferred Shares and all rights thereto, and to fully implement the provisions of this Agreement and the other Transaction Documents.

Section 2.      Representations and Warranties of the Company.

In order to induce the Purchasers to enter into this Agreement and consummate the transactions contemplated hereby, the Company hereby represents and warrants to each Purchaser that the following representations and warranties are true and complete as of the Closing; provided , that such representations and warranties are subject to the qualifications and exceptions set forth in the disclosure schedule delivered to each Purchaser pursuant to this Agreement (the “ Disclosure Schedule ”). The qualifications and exceptions on the Disclosure Schedule shall be arranged in sections corresponding to the numbered and lettered sections and subsections in this Section 2, and the qualifications and exceptions in any section or subsection shall qualify other sections and subsections in this Section 2 only to the extent expressly included in the Disclosure Schedule as a qualification or exception to such other section or subsection.

2.1          Organization and Corporate Power .

(a)     The Company is a corporation duly organized, validly existing and in good standing under the laws of New York, and is duly qualified or registered to do business as a foreign corporation (i) in each jurisdiction listed in Schedule 2.1 and (ii) in each jurisdiction in which the failure to be so duly qualified or registered has had, or could have, a Material Adverse Effect. Each Subsidiary is duly organized, validly existing and in good standing under the laws of its State of organization and each jurisdiction in which the failure of that Subsidiary to be so qualified or registered has had, or could have, a Material Adverse Effect.

(b)     The Company has all required corporate power and authority to carry on its business as presently conducted, to enter into and perform this Agreement and the other Transaction Documents to which it is a party and to carry out the transactions contemplated hereby and thereby, including the issuance and delivery of the Convertible Preferred Shares.

(c)     True, complete and correct copies of the Certificate of Incorporation and the Company’s By-Laws, in each case as amended and in effect as of immediately prior to the filing of the Certificate of Amendment (the “ Charter Documents ”), have been furnished to the Investor by the Company.

2.2           Authorization and Non-Contravention .

(a)     This Agreement and the other Transaction Documents are valid and binding obligations of the Company, and the Series C-3 Amendment, upon filing thereof with the New York State Department of State will be, enforceable in accordance with their respective terms.

(b)     The execution, delivery and performance of this Agreement and the other Transaction Documents and the Series C-3 Amendment, the issuance and delivery of the Convertible Preferred Shares, and, upon conversion of the Convertible Preferred Shares, the issuance and delivery of the Conversion Shares, have been duly authorized by all necessary corporate or other action of the Company’s Board of Directors and the Company’s stockholders.

(c)     The execution and delivery of this Agreement and the other Transaction Documents and the Series C-3 Amendment, the issuance and delivery of the Convertible Preferred Shares, and, upon conversion of the Convertible Preferred Shares, the issuance and delivery of the Conversion Shares, and the performance of the transactions contemplated by this Agreement and the other Transaction Documents, do not and will not: (i) violate or result in a violation of, conflict with or constitute or result in a violation of (whether after the giving of notice, lapse of time or both) any provision of the Charter Documents, as amended through the Closing Date; (ii) conflict with, or constitute a default (or an event that with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation (with or without notice, lapse of time or both) of, any agreement, credit facility, debt, order, writ, decree or other instrument (evidencing a Company debt or otherwise) or other understanding to which the Company or any Subsidiary is a party, including, without limitation, any registration rights of any Person, or by which any property or asset of the Company or any Subsidiary is bound; or (iii) violate, conflict with or result in a violation of, or constitute a default (whether after the giving of notice, lapse of time or both) under, any provision of any Legal Requirement; or (iv) result in the creation of any Claim upon any assets of the Company or any Subsidiary; except in the case of each of clauses, (ii), (iii) and (iv), such as would not have a Material Adverse Effect;

(d)     The Company is not required to obtain any consent, waiver, authorization or order of, give any notice to, or make any filing or registration with, any court or other federal, state, local or other governmental authority or other Person in connection with the execution, delivery and performance by the Company of the Transaction Documents or the Series C-3 Amendment and the consummation of the transactions herein and in the other Transaction Documents or the Series C-3 Amendment, other than (i) the filing of the Certificate of Amendment (which will have been filed with the New York State Secretary of State prior to the Closing), the filing of any Form D required to be filed with the SEC and such other filings as are required to be made under applicable federal and state securities laws, and (ii) as required under the Existing Investor's Rights Agreement.

2.3           The Convertible Preferred Shares .

(a)        The Convertible Preferred Shares purchased by each Purchaser hereunder will have the rights, preferences, privileges, terms and provisions set forth in the Amended Certificate of Incorporation.

(b)      Upon delivery to each Purchaser at the Closing of the stock certificate provided for in Section 1.5(b)(i) above with respect to the Convertible Preferred Shares for issuance, sale, transfer, assignment, conveyance and delivery to such Purchaser, and upon the Company’s receipt of the Purchase Price payable by such Purchaser in accordance with Section 1.5(a)(i) above, (i) such Purchaser will become the sole record, legal and beneficial owner of (A) such Convertible Preferred Shares, and (B) upon conversion of the Convertible Preferred Shares, the Conversion Shares, and the Purchaser will have good and marketable title to the Convertible Preferred Shares and the Conversion Shares and each shall pass to such Purchaser, free and clear of any Claims, except for the restrictions on transfer created by the Amended and Restated Investors’ Rights Agreement, and applicable securities laws; and (ii) the Convertible Preferred Shares have been duly authorized by all necessary corporate action (including, without limitation, any required shareholder or director meeting and consent) and shall be validly issued and outstanding, fully paid and non-assessable, and will be issued in compliance with all applicable federal and state securities laws. When the Conversion Shares are issued upon conversion of the Convertible Preferred Shares, the Conversion Shares will be duly authorized by all necessary corporate action and validly issued and outstanding, fully paid and non-assessable, free and clear of all Claims of any kind and the holders (other than restrictions on transfer created by this Agreement, the Investor Rights Agreement and applicable securities laws) shall be entitled to all rights accorded to a holder of Common Stock.

(c)     The Conversion Shares have been duly reserved for issuance by the Company.

(d)     Upon conversion of the Convertible Preferred Shares, the Conversion Shares will be issued in compliance with all applicable federal and state securities laws, assuming the accuracy of each Purchaser’s representations and warranties set forth in Section 3 now and at the time of such exercise or conversion.

2.4          Capitalization .

(a)     Prior to the filing of the Certificate of Amendment and the Series C-3 Amendment, the authorized capital stock of the Company consists of (i) 400,000,000 shares of Common Stock, par value $0.01 per share, of which (A) 45,716,298 shares are currently outstanding, (B) 17,481,408 shares are reserved for issuance upon conversion of the outstanding Existing Preferred Stock, including the potential impact of conversion of accrued dividends on such Existing Preferred Stock, (C) 3,393,418 shares are reserved for issuance upon the exercise of outstanding Common Stock purchase warrants, (D) 100,000 shares are reserved for issuance upon the exercise of outstanding options under the 1998 Stock Option Plan, (E) 1,307,000 shares are reserved for issuance upon the exercise of options outstanding under the 2011 Stock Option Plan, (F) 1,693,000 additional shares are reserved for issuance pursuant to the 2011 Stock Option Plan in respect of future awards under such plan, (G) 7,063,336 shares are reserved for issuance upon the exercise of outstanding non-plan options, and (H) no other shares are reserved for issuance for any purpose, and (ii) 100,000,000 shares of preferred stock, par value $0.01 per share, including (A) 3,300,000 shares designated as “ Class A Non-Voting Cumulative Convertible Preferred Stock ”, of which 587,101 shares are issued and outstanding and which shares are convertible into 587,101 shares of Common Stock, (B) 300,000 shares designated as “ Class B Non-Voting Cumulative Convertible Preferred Stock ”, of which 67,500 shares are issued and outstanding and which shares are convertible into 67,500 shares of Common Stock, and (C) 16,250,000 shares of Series C Voting Convertible Preferred Stock (the “ Existing Series C Preferred Stock ”), of which 16,250,000 shares are issued and outstanding and which shares are convertible into 16,250,000 shares of Common Stock.  The Company is not a party to a “rights plan”, or “poison pill” agreement. 

(b)     Except as disclosed in Schedule 2.4(b) , there are no outstanding subscriptions, options, warrants, commitments, preemptive rights, agreements, arrangements or commitments of any kind relating to the issuance or sale of, or outstanding securities convertible into or exercisable or exchangeable for, any shares of capital stock of any class or other equity interests of the Company.

(c)     As of the Closing, and after giving effect to the transactions contemplated hereby, all of the outstanding shares of capital stock of the Company (including the Convertible Preferred Shares) will have been duly and validly authorized and issued, fully paid and non-assessable, and will have been offered, issued, sold and delivered in compliance with applicable federal and state securities laws without giving rise to preemptive rights of any kind.

(d)     As of the Closing, and after giving effect to the transactions contemplated hereby, other than rights set forth in the Transaction Documents, except as disclosed in Schedule 2.4(d) , there are (i) no preemptive rights, rights of first refusal, put or call rights or obligations or anti-dilution rights with respect to the issuance, sale or redemption of the Company’s capital stock or any interests therein, or (ii) no rights to have the Company’s capital stock (whether currently outstanding securities or any securities issuable upon exercise or conversion of its currently outstanding securities) registered for sale to the public in connection with the laws of any jurisdiction. To the Company’s Knowledge, no stockholder of the Company has entered into any agreements with respect to the voting of capital stock of the Company.

(e)     The 2007 Commercializing Event Plan and the Trust Agreement, dated September 22, 2005, each of which is referenced in the Company’s 10-Q filing have been terminated and are of no further force or effect.

(f)      Schedule 2.4(f) sets forth the capitalization of the Company (on a fully-diluted basis) immediately following the Closing.

2.5         Subsidiaries; Investments. Except as set forth in Schedule 2.5 , the Company does not have any Subsidiaries and does not own or control, directly or indirectly, any interest in any other corporation, partnership, trust, joint venture, limited liability company, association or other business entity. Except as set forth in Schedule 2.5 , the Company is not a participant in any joint venture, partnership or similar arrangement. Except as set forth in Schedule 2.5 each of the Subsidiaries listed on Schedule 2.5 is wholly owned, directly or indirectly, by the Company and there are no outstanding subscriptions, options, warrants, commitments, preemptive rights, agreements, arrangements or commitments of any kind relating to the issuance or sale of, or outstanding securities convertible into or exercisable or exchangeable for, any shares of capital stock of any class or other equity interests of any such Subsidiary.

2.6          SEC Reports; Financial Statements .

(a)     The Company has filed all forms, reports and exhibits required to be filed by it under the Securities Act and the Exchange Act, including pursuant to Section 13(a) or 15(d) of the Exchange Act, for the two years preceding the date hereof on a timely basis or has received a valid extension of such time of filing and has filed any such SEC Reports prior to the expiration of any such extension.

(b)     As of their respective dates, the SEC Reports or any amendments thereof, complied in all material respects with the requirements of the Exchange Act applicable to the SEC Reports, and none of the SEC Reports or to the extent such reports were amended, at the time they were filed with the SEC, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.

(c)     As of their respective dates, except as set forth therein or in the notes thereto, the financial statements contained in the SEC Reports and the related notes (the “ Financial Statements ”) complied as to form in all material respects with all applicable accounting requirements and the published rules and regulations of the SEC with respect thereto. The Financial Statements: (i) were prepared in accordance with GAAP, consistently applied during the periods involved (except (A) as may be otherwise indicated in the notes thereto or (B) in the case of unaudited interim statements, to the extent that they may not include footnotes, may be condensed or summary statements or may conform to the SEC’s rules and instructions for Reports on Form 10-Q), (ii) fairly present in all material respects the consolidated financial condition, position and operating results of the Company and its consolidated Subsidiaries as of the dates thereof and the consolidated results of their operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal and recurring year-end audit adjustments) and (iii) are in all material respects in accordance with the books of account and records of the Company and its consolidated Subsidiaries (except as may be otherwise noted therein). Neither the Company nor any Subsidiary has any material liabilities or obligations, contingent or otherwise, other than (x) liabilities under contracts and commitments incurred in the ordinary course of Company’s or Subsidiaries’ business, (y) liabilities incurred in the ordinary course of Company’s or Subsidiaries’ business subsequent to September 30, 2013, and (z) liabilities and obligations of a type or nature not required under GAAP to be reflected in the Financial Statements which, in all such cases, individually and in the aggregate would not have a Material Adverse Effect.

2.7          No Material Adverse Changes . Except as otherwise set forth in one of the Company’s reports on Form 10-K, Form 8-K or Form 10-Q, or the Draft 10-K (a copy of which has been provided to Purchasers), or the Schedules hereto since the date of the latest audited Financial Statements, (a) there has been no event, occurrence or development that has had or that would reasonably be expected to result in a Material Adverse Effect, (b) the Company has not incurred any liabilities (contingent or otherwise) other than trade payables and accrued expenses incurred in the ordinary course of business consistent with past practice, (c) the Company has not altered its method of accounting, (d) except for the declaration of dividends with respect to Existing Preferred Stock which dividends are accumulated but not paid, the Company has not declared or made any dividend or distribution of cash or other property to its stockholders or purchased, redeemed or made any agreements to purchase or redeem any shares of its capital stock, (e) the Company has not issued any equity securities to any Person (including without limitation as a result of the exercise of a warrant or option), (f) the Company has not settled or canceled any material debt, claim, suit, arbitration or governmental investigation, (g) the Company has not sold, assigned or transferred any material assets including without limitation any of its intellectual property, (h) the Company has not suffered any substantial losses, and (i) the Company has not made any agreement (written or oral) to effect any of the foregoing. The Company does not have pending before the SEC any request for confidential treatment of information.

2.8         Transactions with Affiliates. Except for awards under the 2011 Stock Option Plan, and as set forth on Schedule 2.8 , there are no loans, leases or other agreements or transactions or proposed agreements or transactions between the Company or a Subsidiary, on the one hand, and any present or former stockholder, director, officer or employee of the Company or a Subsidiary, or to the Knowledge of the Company any member of such officer’s, director’s, employee’s or stockholder’s immediate family, or any Person controlled by such officer, director, employee or stockholder or his or her immediate family, on the other hand. No present (or to the Knowledge of the Company, former) stockholder, director, officer or employee of the Company or a Subsidiary, or to the Knowledge of the Company any of their respective spouses or family members, owns directly or indirectly, on an individual or joint basis, any interest in, or serves as an officer or director or in another similar capacity of, any competitor, customer or supplier of the Company, or any organization which has a material contract or arrangement with the Company.

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

2.10       Title to Assets. The Company and the Subsidiaries have good and marketable title in all personal property owned by them that is material to the business of the Company and the Subsidiaries, taken as a whole, in each case free and clear of all Claims, except for Permitted Encumbrances. Neither the Company nor any Subsidiary owns any real property. Any personal property or real property and facilities held under lease by the Company and/or a Subsidiary are held by them under valid, subsisting and enforceable leases with which the Company and the Subsidiaries are in material compliance.

2.11       Tax Matters. The Company and its Subsidiaries have duly and timely filed all required tax returns and reports required to be filed by them in connection with any federal, state and local tax, duty or charge levied, assessed or imposed upon the Company, its Subsidiaries or their respective assets, including unemployment and social security. The Company and its Subsidiaries have duly and timely paid all taxes due and payable, or, with respect to those taxes which are being contested in good faith, the Company and its Subsidiaries have made an appropriate reserve on their respective financial statements for the same. No taxing authority has asserted or assessed any additional tax liabilities against the Company and its Subsidiaries which are outstanding on this date, there are no pending audits of any tax return or report of the Company or any Subsidiary, and neither the Company nor its Subsidiaries have filed for any extension of time for the payment of any tax or the filing of any tax return or report.

2.12        Intellectual Property.

(a)     To the knowledge of the Company and each Subsidiary, the Company and the Subsidiaries have valid and exclusive ownership of, or have sufficient legal rights to use, all patents, patent applications, trademarks, trademark applications, service marks, service mark applications, trade names, copyrights, trade secrets, domain names, proprietary rights and processes, licenses and other similar rights that are necessary or material for use in connection with their respective businesses as described in the SEC Reports and as presently proposed to be conducted and which the failure to so have could have or reasonably be expected to result in a Material Adverse Effect (collectively, the " Intellectual Property Rights "). To the Knowledge of the Company, all such Intellectual Property Rights are enforceable and, other than with respect to commercially available software products under standard end-user license agreements and as set forth on Schedule 2.12(a), there are no outstanding options, licenses, agreements, Claims or shared ownership interests relating to any Intellectual Property Rights. To the Company’s Knowledge, neither the Company nor any Subsidiary is infringing on the intellectual property rights of any other Person nor is any Person infringing on the intellectual property rights of the Company or any Subsidiary. Neither the Company nor any Subsidiary has received any communications alleging that the Company or a Subsidiary has violated or, by conducting its business, would violate any of the patents, trademarks, service marks, tradenames, copyrights, trade secrets, mask works or other proprietary rights or processes of any other Person.

(b)     No third party has claimed that any Person employed by or affiliated with the Company has (i) violated any of the terms or conditions of such Person’s employment, non-competition, non-disclosure or similar agreement with such third party; (ii) disclosed or utilized any trade secret or proprietary information or documentation of such third party or (iii) interfered in the employment relationship between such third party and any of its employees. To the Company’s knowledge, no Person employed by or affiliated with the Company has used any trade secret or any information or documentation proprietary to any other Person in connection with the Company’s business. Each Person employed by or that has served as a consultant has assigned to the Company all intellectual property rights he or she owns that are related to the Company’s business including all Intellectual Property Rights, other than such failure to obtain as would not be reasonably expected to have a Material Adverse Effect.

2.13        Litigation, Investigations etc.. There is no claim, action, suit, governmental or administrative proceeding or investigation, arbitration or charge pending or, to the Knowledge of the Company, threatened against the Company or any of its Subsidiaries or any of their directors or officers or which questions the validity of this Agreement or any other Transaction Document or the Series C-3 Amendment. Without limitation to the foregoing, the Company is not subject to any investigation or proceeding by the SEC or any state securities commissions. There is no claim, action or suit which the Company intends to initiate.

2.14        Employees; Employee Matters.

(a)     Neither the Company nor its Subsidiaries have any collective bargaining arrangements or agreements covering any of their employees, and there is no strike or other labor dispute involving the Company or, to the Company’s knowledge, threatened, which could have a Material Adverse Effect. Except as disclosed in the SEC Documents, neither the Company nor its Subsidiaries have any employment contract, or any other similar contract relating to the right of any officer, employee or consultant to be employed or engaged by the Company or such Subsidiary. Since December 31, 2013, no officer, consultant or employee of the Company or its Subsidiary whose termination, either individually or in the aggregate, could have a Material Adverse Effect, has terminated or, to the knowledge of the Company, has any present intention of terminating his or her employment or engagement with the Company or any Subsidiary. The Company is not delinquent in payments to any of its employees or independent contractors for any wages, salaries, commissions, bonuses or any other compensation for any service performed for it to the date hereof. Except as set forth on Schedule 2.14 , upon termination of employment of any Company employee no severance or other payments will become due.

(b)      Schedule 2.14(b) sets forth each employee benefit plan maintained, established or sponsored by the Company or which the Company participates in or contributes to, which is subject to the Employee Retirement Income Security Act of 1974, as amended (“ ERISA ”). The Company has made all required contributions and has no liability to any such employee benefit plan, other than liability for health plan continuation coverage described in Part 6 of Title I(B) of ERISA, and has complied in all material respects with all applicable laws for any such employee benefit plan.

2.15       Compliance with Legal Requirements. Except as set forth on Schedule 2.15 , the Company complies and has at all times prior to the date hereof complied in all material respects with all applicable Legal Requirements (including, without limitation, with respect to wages, hours, worker classification and collective bargaining, and all environmental and safety matters), and the Company has not received notice from any governmental authority or any other Person of any alleged violation or noncompliance.

2.16       Insurance Coverage. The Company and the Subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as are prudent and customary in the businesses in which the Company and the Subsidiaries are engaged.

2.17       Investment Banking; Brokerage. There are no claims for, and the Company is not obligated to pay any, investment banking fees, brokerage commissions, broker’s or finder’s fees or similar compensation in connection with the transactions contemplated by this Agreement payable by the Company or based on any arrangement or agreement made by or on behalf of the Company.

2.18      Private Placement. Assuming the accuracy of each Purchaser’s representations and warranties set forth in Section 3 now and at the time of any subsequent exercise or conversion thereof, no registration under the Securities Act is required for the offer and sale of the Convertible Preferred Shares by the Company to the Purchaser as contemplated hereby or the issuance to a Purchaser of any Conversion Shares. Neither the Company nor any Person acting on its behalf has made any offer or sales of any securities or solicited any offers to purchase any security under circumstances that would eliminate the availability of the exemption from registration under Section 4(2) of the Securities Act.

2.19      Investment Company. The Company is not, and is not an Affiliate of, an "investment company" within the meaning of the Investment Company Act of 1940, as amended.

2.20      Disclaimer. EXCEPT AS EXPRESSLY SET FORTH IN THIS Section 2 , OR AS EXPRESSLY SET FORTH IN ANY OTHER TRANSACTION DOCUMENT, THE COMPANY MAKES NO OTHER REPRESENTATION OR WARRANY, EXPRESS OR IMPLIED, AT LAW OR IN EQUITY, IN RESPECT OF ANY OF ITS ASSETS, LIABILITIES OR OPERATIONS.

Section 3.      Representations and Warranties of the Purchaser .

In order to induce the Company to enter into this Agreement, each Purchaser represents and warrants to the Company, severally and not jointly, as to itself, the following:

3.1        Investment Status .

(a)     The Purchaser is purchasing the Convertible Preferred Shares for its own account, for investment only and not with a view to, or any present intention of, effecting a distribution of such securities or any part thereof except pursuant to a registration or an available exemption under applicable Legal Requirements.

(b)     The Purchaser acknowledges that neither the Convertible Preferred Shares nor the Conversion Shares have been registered under the Securities Act or the securities laws of any state or other jurisdiction and cannot be disposed of unless they are subsequently registered under the Securities Act and any applicable state laws or an exemption from such registration is available.

3.2      Accredited Investor. The Purchaser is an "accredited investor" as defined in Regulation D and has such knowledge and experience in financial and business matters that he is capable of evaluating the merits and risks of the prospective investment in the Convertible Preferred Shares.

3.3      Opportunities for Additional Information . The Purchaser acknowledges that he has had the opportunity to ask questions of and receive answers from, or obtain additional information from, the executive officers of the Company concerning the financial and other affairs of the Company, and to the extent deemed necessary in light of the Purchaser’s personal knowledge of the Company's affairs, the Purchaser has asked such questions and received in writing answers to the full satisfaction of the Purchaser, and the Purchaser desires to invest in the Company.

3.4      No General Solicitation . The Purchaser acknowledges that the Convertible Preferred Shares were not offered to him by means of any form of general or public solicitation or general advertising, or publicly disseminated advertisements or sales literature, including (a) any advertisement, article, notice or other communication published in any newspaper, magazine, or similar media, or broadcast over television or radio, or (b) any seminar or meeting to which such Purchaser was invited by any of the foregoing means of communications.

3.5      Rule 144 . The Purchaser understands that the Convertible Preferred Shares and the Conversion Shares must be held indefinitely unless they are registered under the Securities Act or an exemption from registration is available. The Purchaser acknowledges that he is familiar with Rule 144 of the rules and regulations of the SEC, as amended, promulgated pursuant to the Securities Act, and that he has been advised that Rule 144 permits resales only under certain circumstances. The Purchaser understands that to the extent that Rule 144 is not available, the Purchaser will be unable to sell any Convertible Preferred Shares or Conversion Shares without either registration under the Securities Act or the existence of another exemption from such registration requirement.

3.6      No Shorting . The Purchaser has not engaged in any short sales of the Common Stock or instructed any third parties to engage in any short sales of the Common Stock on his behalf prior to the Closing Date. The Purchaser covenants and agrees that it will not be in a net short position with respect to the shares of Common Stock. For purposes of this Section 3.6, a "net short position" means a sale of Common Stock by a Purchaser that is marked as a short sale and that is made at a time when there is no equivalent offsetting long position in Common Stock held by the Purchaser.

3.7      General . The Purchaser understands that the Convertible Preferred Shares are being offered and sold in reliance on a transactional exemption from the registration requirement of Federal and state securities laws and the Company is relying upon the truth and accuracy of the representations, warranties, agreements, acknowledgments and understandings of the Purchaser set forth herein in order to determine the applicability of such exemptions and the suitability of the Purchaser to acquire the Convertible Preferred Shares.

3.8      Investment Banking; Brokerage Fees. The Purchaser has not incurred or become liable for any investment banking fees, brokerage commissions, broker’s or finder’s fees or similar compensation (exclusive of professional fees to lawyers and accountants) in connection with the transactions contemplated by this Agreement.

3.9     Exculpation Among Purchasers . The Purchaser acknowledges that it is not relying upon any Person, other than the Company and its officers and directors, in making its investment or decision to invest in the Company. The Purchaser agrees that neither any Purchaser nor the respective controlling Persons, officers, directors, partners, agents, or employees of any Purchaser shall be liable to any other Purchaser for any action heretofore taken or omitted to be taken by any of them in connection with the purchase of the Convertible Preferred Shares.

Section 4.      Closing Conditions and Deliveries .

The obligations of each Purchaser to purchase and pay for the Convertible Preferred Shares shall be subject to the fulfillment by the Company, to the Purchaser’s reasonable satisfaction, before the Closing of the following conditions, unless otherwise waived by the Purchaser:

4.1      Representations and Warranties . The representations and warranties of the Company contained in Section 2 shall be true and correct in all respects as of the Closing.

4.2     Performance. The Company shall have performed and complied with all covenants, agreements, obligations and conditions contained in this Agreement that are required to be performed or complied with by the Company on or before the Closing.

4.3     Authorizations . All authorizations, approvals or permits, if any, of any governmental authority or regulatory body of the United States or any state that are required in connection with the lawful issuance of the Convertible Preferred Shares pursuant to this Agreement shall be obtained and effective as of the Closing.

4.4     Deliveries by the Company.      

(a)     At the Closing, the Company shall have delivered, or shall have caused to be delivered, those deliveries contemplated by Section 1.5(b) above.     

(b)      With respect to the Investor, the Company shall have delivered, or shall have caused to be delivered, those deliveries contemplated by Section 1.5(c) above.

4.5     No Material Adverse Effect. No event shall have occurred since December 31, 2013 and no facts or conditions shall exist that, individually or in the aggregate, have had, or would reasonably be expected to have, a Material Adverse Effect.

4.6     No Litigation or Injunction. There shall be no action, suit, claim or proceeding of any nature pending, or overtly threatened against (a) the Purchasers or the Company, their respective properties or any of their respective officers, directors or Affiliates arising out of, or in any way connected with, the transactions contemplated by this Agreement or any other Transaction Document or (b) the Company, its properties or any of its officers, directors or Affiliates that has had or could reasonably be expected to have a Material Adverse Effect, and the consummation of the transactions contemplated by this Agreement and the other Transaction Documents shall not violate any order, decree or judgment of any court or governmental body having competent jurisdiction.

4.7     Certificate of Amendment . The Company shall have filed the Certificate of Amendment with the Secretary of State of New York State prior to the Closing, a copy of the filing receipt of which shall be provided to each Purchaser.

4.8     Reservation of Shares . The Company shall have reserved for issuance a sufficient number of shares of Common Stock for the purpose of enabling the Company to satisfy any obligations to issue Conversion Shares on the conversion of the Convertible Preferred Shares.

Section 5.      Closing Conditions and Deliveries .

The obligations of the Company to issue and sell the Convertible Preferred Shares and to consummate the other transactions contemplated by this Agreement and the other Transaction Documents shall be subject to the fulfillment by each Purchaser to the Company’s reasonable satisfaction or waiver on or before the Closing Date of the following conditions:

5.1     Closing Deliveries by the Purchaser to the Company. At the Closing, the Purchaser shall deliver, or shall cause to be delivered, to the Company, the deliveries contemplated by Section 1.5(a).

5.2     Representations and Warranties. The representations and warranties of each Purchaser contained in Section 3 shall be true and correct, in all respects as of the Closing.

5.3     Performance. Each Purchaser shall have performed and complied with all covenants, agreements, obligations and conditions contained in this Agreement that are required to be performed or complied with by the Purchasers on or before the Closing.

5.4     Authorizations . All authorizations, approvals or permits, if any, of any governmental authority or regulatory body of the United States or any state that are required in connection with the lawful issuance of the Convertible Preferred Shares pursuant to this Agreement shall be obtained and effective as of the Closing.

Section 6.      Covenants .

The Company covenants with each of the Purchaser and the Investor, as applicable as follows, which covenants are for the benefit of the Purchasers and the Investor, as applicable:

6.1     Series C-3 Preferred Offering .  The Company covenants that it will, at any time or times on or before the 180th day following the Closing, use commercially reasonable efforts to sell to additional investors in the Series C-3 Preferred Offering (the “ Additional Purchasers ”) up to $1,000,000 of Series C-3 Stock at a price, not less than $0.25 per share, to be determined by the Board of Directors (or a committee thereof) prior to the filing of the Series C-3 Amendment, which shall be at a discount from market no greater than the discount to market of the Series C-2 Preferred at Closing based on a 15 day trailing closing price or bid price if no transactions took place (the “ Series C-3 Price ”); provided that if the sale of Series C-3 Stock (or some portion of the Series C-3 Stock) during such period could result in an “ownership change”, as determined under Section 382 of the Internal Revenue Code, which would jeopardize the Company’s ability to fully utilize its net operating loss carryforwards (an “ Ownership Change ”) then the Company shall not have the obligation to sell the Series C-3 Stock (or that portion of the Series C-3 Stock) until such time during that period at which an Ownership Change would not occur.  Promptly following the determination of the Series C-3 Price the Company shall inform the Purchasers of the Series C-3 Price and, thereafter and prior to the offering of Series C-3 Stock, shall file the Series C-3 Amendment in the same form attached as Exhibit A-2 but for inclusion of the Series C-3 Price and the number of shares of Series C-3 Stock that are authorized and no other changes. All sales of Series C-3 Stock at the Series C-3 Price made at any additional closings shall be made on the terms and conditions permitted by this Agreement.  The Purchasers acknowledge that several of the Company’s directors expect to participate as purchasers in the Series C-3 Preferred Offering.

6.2     Securities Compliance .

(a)     The Company shall timely notify the Commission in accordance with their rules and regulations, of the transactions contemplated by any of the Transaction Documents, including filing a report on Form 8-K and filing a Form D with respect to the Convertible Preferred Shares, and Conversion Shares, if required by the Commission's rules, and shall take all other necessary action and proceedings as may be required and permitted by applicable federal or state law, rule and regulation, for the legal and valid issuance of the Convertible Preferred Shares, and the Conversion Shares to the Purchasers or subsequent holders

(b)     The Company is relying upon the truth and accuracy of the representations, warranties, agreements, acknowledgments and understandings of the Purchasers set forth herein in order to determine the applicability of Federal and state securities laws exemptions and the suitability of such Purchasers to acquire the Convertible Preferred Shares.      

6.3      Noncircumvention . The Company shall not, by amendment of its Certificate of Incorporation or By-Laws or through any reorganization, transfer of assets, consolidation, merger, issue or sale of securities, or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Agreement, the Transaction Documents or the Convertible Preferred Shares.

6.4      Consent and Waiver .

(a)     The Purchasers hereby consent to the Certificate of Amendment, the consummation of the transactions contemplated by the Transaction Documents, the Series C-3 Amendment, and the Series C-3 Preferred Offering for purposes of Sections 11.G and 12.G. of the Certificate of Incorporation, as amended, including without limitation for purposes of Section 11.G(1), (2), (5), (6) and (7), and Section 12.G(1), (2), (5), (6) and (7), which constitutes the written consent without a meeting of the holders of at least two-thirds of the outstanding Existing Series C Preferred Stock and at least two-thirds of the outstanding Series C-2 Stock, as set forth therein.

(b)     The Existing Investors hereby waive their respective rights of first offer under Section 4.1 under the Existing Investors' Rights Agreement, as amended and restated, with regard to the consummation of the transactions contemplated by this Agreement, including without limitation the offer and sale of the Convertible Preferred Shares and the Series C-3 Stock in the Series C-3 Preferred Offering.

Section 7.  General .

(a)     For the purposes of this Agreement and the other Transaction Documents, no course of dealing between or among any of the parties hereto and no delay on the part of any party hereto in exercising any rights hereunder or thereunder shall operate as a waiver of the rights hereof and thereof. No covenant or provision hereof may be waived otherwise than by a written instrument signed by the party or parties so waiving such covenant or other provision as contemplated herein.

(b)     No amendment to this Agreement may be made without the written consent of the Company and Purchasers holding at least a majority of the outstanding Convertible Preferred Shares.

7.2     Legend on Convertible Preferred Shares . The Company and the Purchasers acknowledge and agree that:

(a)      the following legend shall be typed on each certificate evidencing any of the Convertible Preferred Shares or Conversion Shares issued at any time by the Company:

“THE SALE, TRANSFER, PLEDGE OR OTHER DISPOSITION OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE IS SUBJECT TO CERTAIN RESTRICTIONS SET FORTH IN THE SECURITIES PURCHASE AGREEMENT PURSUANT TO WHICH THESE SECURITIES WERE PURCHASED FROM THE COMPANY. COPIES OF SUCH RESTRICTIONS ARE ON FILE AT THE PRINCIPAL OFFICES OF THE COMPANY. NO TRANSFER OF SUCH SECURITIES OR OF THIS CERTIFICATE (OR OF ANY SHARES OR OTHER SECURITIES (OR CERTIFICATES THEREFOR) ISSUED IN EXCHANGE FOR OR IN RESPECT OF SUCH SECURITIES) SHALL BE EFFECTIVE UNLESS AND UNTIL THE TERMS AND CONDITIONS SET FORTH IN THE SECURITIES PURCHASE AGREEMENT HAVE BEEN COMPLIED WITH.”

“NO SALE, OFFER TO SELL, OR TRANSFER OF THE SERIES C-2 PREFERRED SHARES REPRESENTED BY THIS CERTIFICATE , OR THE SECURITIES ISSUABLE UPON THE CONVERSION THEREOF, SHALL BE MADE IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND IN COMPLIANCE WITH ANY APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT THE PROPOSED TRANSFER IS EXEMPT FROM THE REGISTRATION REQUIREMENTS OF SAID ACT AND IS IN COMPLIANCE WITH APPLICABLE STATE SECURITIES LAWS.”

(b)     the aforementioned legends shall be placed on or omitted (or removed) from certificates representing the Convertible Preferred Shares and Conversion Shares issued to the Investor as set forth in the Amended and Restated Investors’ Rights Agreement.

  7.3     Survival and Expiration . The respective representations, warranties, covenants and agreements of the Company and each Purchaser set forth in this Agreement (except covenants and agreements which are expressly required to be performed and are performed in full on or prior to the Closing Date) shall survive the Closing and the consummation of the transactions contemplated hereby.

7.4     Indemnification

(a)     The Company agrees to indemnify and hold harmless the Purchasers, their beneficiaries, heirs, successors and assigns for loss or damage including, without limitation, reasonable attorneys’ fees and other expenses, arising as a result of or related to any breach by the Company of any of its representations and warranties contained in this Agreement. For purposes of this Agreement, such loss or damage shall specifically exclude any lost profits (but shall not exclude loss of value), consequential damages or punitive damages.

(b)     Each Purchaser, severally and not jointly on its own behalf agrees to indemnify and hold harmless the Company, and its Affiliates, and each Person who controls any of them within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act (a “ Company Indemnified Party ”), for loss and damage including, without limitation, reasonable attorneys’ fees and other expenses arising as a result of or related to any breach by the Purchaser of any of his, her or its representations and warranties contained in this Agreement. For purposes of this Agreement, such loss or damage shall specifically exclude any lost profits, consequential damages or punitive damages.

(c)     The maximum amount payable by the Company to a Purchaser, or a Purchaser to the Company or any Company Indemnified Party, for losses or damages in respect of claims made by the Purchaser for indemnification under this Section 7.4, shall not exceed an amount equal to the Purchase Price paid by such Purchaser.

(d)     After the Closing, the rights and remedies expressly provided pursuant to the terms of this Agreement will constitute the sole and exclusive basis for, and means of, recourse between the parties with respect to the subject matter hereof, and the Company and the Purchaser each expressly waives any and all other rights or causes of action with respect to the subject matter hereof that it may have against the other party now or in the future under any applicable Legal Requirement. Without limiting the generality of the foregoing, each party agrees that, after the Closing, this Section 7.4 provides its sole remedy with respect to any loss or damages arising from the breach by another party of any of the breaching party’s representations and warranties contained in this Agreement; provided, however, that (i) this Section 7.4(d) shall not apply with respect to any claim based on fraud or intentional misrepresentation, and (ii) nothing contained in this Agreement shall impair or limit in any way the rights or remedies available to the Purchaser under or in respect of the other Transaction Documents.

7.5      Governing Law; Waiver of Jury Trial. This Agreement shall be deemed to be a contract made under, and shall be construed in accordance with, the laws of the State of New York, without giving effect to conflict of laws principles thereof. EACH PARTY HERETO ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE IT HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT AND THE OTHER TRANSACTION DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

7.6        Section Headings; Construction . The descriptive headings in this Agreement have been inserted for convenience only and shall not be deemed to limit or otherwise affect the construction of any provision thereof or hereof. The use in this Agreement of the masculine pronoun in reference to a party hereto shall be deemed to include the feminine or neuter, and vice versa, as the context may require. The parties have participated jointly in the negotiation and drafting of this Agreement and the other Transaction Documents with counsel sophisticated in investment transactions. In the event an ambiguity or question of intent or interpretation arises, this Agreement and the other Transaction Documents shall be construed as if drafted jointly by the parties and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provisions of this Agreement and the other Transaction Documents. Where the word “including” or the word “includes” is used in this Agreement, it means “including (or includes) without limitation”.

7.7        Counterparts . This Agreement may be executed simultaneously in any number of counterparts, each of which when so executed and delivered shall be taken to be an original; but such counterparts shall together constitute but one and the same document.

7.8       Notices and Demands . Any notice or demand which is required or provided to be given under this Agreement shall be deemed to have been sufficiently given and received for all purposes when delivered in writing by hand, facsimile, email or other method of electronic delivery, or five (5) days after being sent by certified or registered mail, postage and charges prepaid, return receipt requested, or two (2) days after being sent by overnight delivery providing receipt of delivery, to the following addresses:

(a)     if to the Company, to: Torvec Inc., 1999 Mt. Read Boulevard, Building 3, Rochester, NY 14615, Attention: Chief Executive Officer, Fax: 585-254-1105, Email: dickk@torvec.com, with copies (which shall not constitute notice) to Torvec Inc., 1999 Mt. Read Boulevard, Building 3, Rochester, NY 14615, Attention: General Counsel, Fax: 585-254-1105, Email: dsullivan@torvec.com; and

(b)     if to the Investor, to: B. Thomas Golisano, 3175 Green Dolphin Lane, Naples, Florida 34102, Fax: 585-383-3428, Email: tgolisano@bluetie.com, with a copy (which shall not constitute notice) to Fisher Asset Management, 1 Fishers Road, Pittsford, NY 14534, Attention: David Still, Fax: 585-340-1202, Email: dstill@golisanofoundation.org.

(c)     if to a Purchaser other than the Investor, to the address set forth on the Schedule of Purchasers.

7.9         Remedies; Severability . Notwithstanding anything herein to the contrary, it is specifically understood and agreed that any breach of the provisions of the Transaction Documents by any Person subject hereto or thereto will result in irreparable injury to the other parties hereto or thereto, that the remedy at law alone will be an inadequate remedy for such breach, and that, in addition to any other remedies which they may have at law or in equity, including recovery of damages, such other parties may enforce their respective rights by actions for specific performance (to the extent permitted by law). Whenever possible, each provision of this Agreement shall be interpreted in such a manner as to be effective and valid under applicable law, but if any provision of this Agreement shall be deemed prohibited or invalid under such applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, and such prohibition or invalidity shall not invalidate the remainder of such provision or the other provisions of this Agreement.

7.10       Integration . This Agreement, including the exhibits, schedules, documents and instruments referred to herein or therein constitute the entire agreement, and supersede all other prior agreements and understandings, both written and oral, among the parties with respect to the subject matter hereof and thereof.

7.11     Assignability; Binding Agreement. This Agreement may not be assigned by any party hereto without the prior written consent of each other party hereto. This Agreement shall be binding upon and enforceable by, and shall inure to the benefit of, the parties hereto and their respective successors, heirs, executors, administrators and permitted assigns, and no others. Notwithstanding the foregoing, nothing in this Agreement is intended to give any Person not named herein the benefit of any legal or equitable right, remedy or claim under this Agreement, except as expressly provided herein.

7.12     Press Releases and Public Announcements. No Party shall issue any press release or make any public announcement relating to the subject matter of this Agreement without the prior written approval of the Company and the Investor, except as may otherwise be required by applicable Legal Requirement, or rule of any trading market where the Company’s securities are quoted in order to maintain current reporting status.

7.13     Fees and Expenses. Except as otherwise specified in this Section 7.13 or agreed in writing by the parties, all costs and expenses incurred in connection with this Agreement, the Transaction Documents and the transactions contemplated by this Agreement shall be paid by the party incurring such cost or expense. At the Closing, the Company shall promptly reimburse the Investor upon presentation of appropriate invoices and documentation therefor for all Reimbursable Expenses incurred, by or on behalf of the Investor. For purposes of this Agreement, “ Reimbursable Expenses ” shall mean all reasonable out-of-pocket fees and expenses incurred by the Investor in connection with his due diligence investigation of the Company, the preparation of this Agreement and the other Transaction Documents and consummation of the transactions contemplated by this Agreement, including all reasonable fees and expenses of counsel to the Investor.

7.14      Waiver of Conflicts . Each party to this Agreement acknowledges that Woods Oviatt Gilman, LLP, counsel for the Company, has in the past performed and may continue to perform legal services for the Investor in matters unrelated to the transactions described in this Agreement, including the representation of such Investor in venture capital financings and other matters. Accordingly, each party to this Agreement hereby (a) acknowledges that they have had an opportunity to ask for information relevant to this disclosure; and (b) gives its informed consent to Woods Oviatt Gilman LLP’s representation of certain of the Investor in such unrelated matters and to Woods Oviatt Gilman LLP’s representation of the Company in connection with this Agreement and the transactions contemplated hereby.

7.15       Finders Fee. Each party represents that it neither is nor will be obligated for any finder’s fee or commission in connection with this transaction. Each Purchaser agrees to indemnify and to hold harmless the Company from any liability for any commission or compensation in the nature of a finder’s or broker’s fee arising out of this transaction (and the costs and expenses of defending against such liability or asserted liability) for which each Purchaser or any of its officers, employees, or representatives is responsible. The Company agrees to indemnify and hold harmless each Purchaser from any liability for any commission or compensation in the nature of a finder’s or broker’s fee arising out of this transaction (and the costs and expenses of defending against such liability or asserted liability) for which the Company or any of its officers, employees or representatives is responsible.

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IN WITNESS WHEREOF , the parties have executed this Agreement or have caused this Agreement to be duly executed and delivered by their proper and duly authorized officers as of the day and year first above written.

Exhibit 10.2

AMENDED AND RESTATED INVESTORS’ RIGHTS AGREEMENT

THIS AMENDED AND RESTATED INVESTORS’ RIGHTS AGREEMENT is made as of the 28 day of March, 2014, by and among Torvec, Inc., a New York corporation (the “ Company ”), B. Thomas Golisano, a resident of the State of Florida (the “ Investor ”), and Charles T. Graham and David Still (collectively, the “ Additional Investors ”). The “Investor” and the “Additional Investors” are referred to collectively as the “Purchasers.”

RECITALS

WHEREAS , the Purchasers are holders of Series C Voting Preferred Stock, par value $0.01 per share (the “ Existing Series C Preferred Stock ”), and/or shares of Common Stock issued upon thereof, and posses registration rights, information rights, rights of first offer, and other rights pursuant to that certain Investors’ Rights Agreement dated as of September 23, 2011, between the Company and the Purchasers (the “ Prior Agreement ”);

WHEREAS , the Purchasers desire to amend and restate the Prior Agreement in its entirety and to accept the rights created pursuant to this Agreement in lieu of the rights granted to them under the Prior Agreement;

WHEREAS , the Company and the Purchasers are parties to that certain Securities Purchase Agreement of even date herewith (the “ Purchase Agreement ”, and together with the Existing Series C Preferred Stock Purchase Agreement (defined below), the “ Purchase Agreements ”), pursuant to which the Purchasers are purchasing $5,000,000 of the Company’s Series C-2 Voting Preferred Stock, par value $0.01 per share (the “ Series C-2 Voting Preferred Stock ,” and together with the Existing Series C Preferred Stock, the “ Series C Preferred Stock ”);

WHEREAS , under the Purchase Agreement, certain of the Company’s and Investor’s obligations are conditioned upon the execution and delivery of this Agreement by Purchasers and the Company; and

WHEREAS , in order to induce the Company to enter into the Purchase Agreement and to induce the Purchasers to invest funds in the Company pursuant to the Purchase Agreement, the Purchasers and the Company hereby agree that this Agreement shall govern the rights of the Purchasers to cause the Company to register shares of Common Stock issuable to the Purchasers, to receive certain information from the Company, and to participate in future equity offerings by the Company, and shall govern certain other matters as set forth in this Agreement;

NOW, THEREFORE , the parties to this Agreement agree as follows:

1.         Definitions . For purposes of this Agreement:

1.1.     “ Affiliate ” means, with respect to any specified Person, any other Person who, directly or indirectly, controls, is controlled by, or is under common control with such Person, including without limitation any general partner, managing member, officer  or director of such Person.

1.2.     “ Certificate of Incorporation ” means the Company’s Certificate of Incorporation, as amended from time to time.

1.3.     “ Common Stock ” means shares of the Company’s common stock, par value $0.01 per share.

1.4.     “ Compensatory Equity Interest ” means any equity security (or any commitment to sell, grant or issue any equity security under any option, warrant, conversion or exchange right or otherwise) of the Company or any subsidiary or any phantom stock, stock appreciation right or similar equity or equity-based compensation right of the Company or any subsidiary, (i) awarded as compensation for or as an incentive to service or continued service with the Company (including without limitation under the 2011 Stock Option Plan or any other option or other equity incentive plan) to employees, officers, or directors or, or consultants, advisors or other providers of services to, the Company, (ii) issued as payment for rent or other sums under any lease or (iii) issued as payment of royalties or other consideration under any license agreement; provided, however that Compensatory Equity Interests shall not include (A) outstanding options and warrants, listed in Section 2.4 of the Purchase Agreement, (B) conversion and dividend rights now provided for in the certificate of incorporation as amended to date, or (C) stock options issued pursuant to the 2011 Stock Option Plan for the purchase of up to an aggregate of 25,000 shares in any particular year granted in the discretion of the Board of Directors.

1.5.     “ Compensating Shares ” has the meaning given to that term in Subsection 5.2 .

1.6.    " Convertible Preferred Shares " means collectively the shares of the Existing Series C Preferred Stock and the Series C-2 Voting Preferred Stock purchased under the Purchase Agreements.

1.7.     " Conversion Shares" means the shares of Common Stock issuable upon conversion of the Convertible Preferred Shares.

1.8.     “ Damages ” means any loss, damage, or liability (joint or several) to which a party hereto may become subject under the Securities Act, the Exchange Act, or other federal or state law, insofar as such loss, damage, or liability (or any action in respect thereof) arises out of or is based upon (i) any untrue statement or alleged untrue statement of a material fact contained in any registration statement of the Company, including any preliminary prospectus or final prospectus contained therein or any amendments or supplements thereto; (ii) an omission or alleged omission to state therein a material fact required to be stated therein, or necessary to make the statements therein not misleading; or (iii) any violation or alleged violation by the indemnifying party (or any of its agents or Affiliates) of the Securities Act, the Exchange Act, any state securities law, or any rule or regulation promulgated under the Securities Act, the Exchange Act, or any state securities law.

1.9.       “ Deemed Common Shares ” means, with respect to a Purchaser, (i) the number of shares of Common Stock issuable or issued upon conversion of the Series C Preferred Stock acquired by the Purchaser under the Purchase Agreements, (ii) the number of Compensating Shares, if any, issued or issuable to such Purchaser; (ii ) the number of shares of Common Stock i ssued or issuable upon exercise of the Warrants acquired by the Purchaser under the Existing Series C Preferred Stock Purchase Agreement; and (iii) the number of shares of Common Stock issued as (or issuable upon the conversion or exercise of any warrant, right, or other security that is issued as) a dividend or other distribution with respect to, or in exchange for or in replacement of, the shares referenced in clauses (i), (ii) and (iii) above, in each case as adjusted for stock splits, stock dividends, combinations, and other recapitalizations for which adjustment has not otherwise been made.

1.10.    “ Derivative Securities ” means any securities or rights convertible into, or exercisable or exchangeable for (in each case, directly or indirectly), Common Stock, including options and warrants.

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

1.12.    “ Excluded Registration ” means (i) a registration relating to the sale of securities to employees, directors or consultants of the Company or a subsidiary pursuant to a stock option, stock purchase, or similar plan; (ii) a registration relating to an SEC Rule 145 transaction; (iii) a registration on any form that does not include substantially the same information as would be required to be included in a registration statement covering the sale of the Registrable Securities; or (iv) a registration in which the only Common Stock being registered is Common Stock issuable upon conversion of debt securities that are also being registered.

1.13.      “ Exempted Securities ” means (i) shares of capital stock or Derivative Securities issued as a dividend or distribution on any capital stock or Derivative Securities of the Company; (ii) shares of capital stock or Derivative Securities issued by reason of a stock split, combination, split-up or other reorganization or recapitalization of the Company’s capital stock; (iii) shares of Common Stock or Derivative Securities issued to employees or directors of, or consultants or advisors to, the Company or any of its subsidiaries pursuant to a plan, agreement or arrangement approved by the Board of Directors of the Company; (iv) a Compensatory Equity Interest; (v) shares of Common Stock or Derivative Securities actually issued upon the exercise of options or warrants, or shares of Common Stock actually issued upon the conversion or exchange of Derivative Securities, in each case provided such issuance is pursuant to the terms of such Derivative Securities; (vi) securities issued pursuant to a Directors’ Investment Transaction or in connection with the Series C-3 Preferred Offering (each as defined in the Purchase Agreements); and (vii) shares of Common Stock or Derivative Securities issued pursuant to the acquisition of another company by the Company by merger, purchase of substantially all of the assets or other reorganization or to a joint venture agreement or otherwise in a bona fide acquisition of business assets.

1.14.      “ Existing Series C Preferred Stock Purchase Agreement ” shall have the meaning provided in Section 6.10 below.

1.15.     “ Form S-3 ” means such form under the Securities Act as in effect on the date hereof or any registration form under the Securities Act subsequently adopted by the SEC that permits incorporation of substantial information by reference to other documents filed by the Company with the SEC.

1.16.     “ Holder ” means any holder of Registrable Securities who is a party to this Agreement or an assignee thereof who succeeds to rights at issue.

1.17.     “ Immediate Family Member ” means a child, stepchild, grandchild, parent, stepparent, grandparent, spouse, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law, including adoptive relationships, of a natural person referred to herein.

1.18.     “ New Securities ” means, collectively, equity securities of the Company, whether or not currently authorized, as well as rights, options, or warrants to purchase such equity securities, or securities of any type whatsoever that are convertible or exchangeable into or exercisable for such equity securities (including without limitation Derivative Securities).

1.19.     “ Ownership Percentage ” means at the time of measurement, the proportion that the Deemed Common Shares then beneficially held by a Purchaser, bears to the total Common Stock of the Company then outstanding or issuable pursuant to outstanding Derivative Securities, assuming full conversion and/or exercise, as applicable, of all such Derivative Securities then outstanding, expressed as a percentage. For avoidance of doubt, such Derivative Securities include, but are not limited to, all of the Company’s convertible preferred stock, warrants and options.

1.20.     “ Person ” means any individual, corporation, partnership, trust, limited liability company, association or other entity.

1.21.     “ Registrable Securities ” means (i) the Common Stock issuable or issued upon conversion of the Series C Preferred Stock acquired by the Purchasers under the Purchase Agreements and any Compensating Shares issued to such Persons; (ii) any Common Stock issued or issuable upon exercise of the Warrants acquired by the Purchasers under the Existing Series C Preferred Stock Purchase Agreement; and (iii) any Common Stock issued as (or issuable upon the conversion or exercise of any warrant, right, or other security that is issued as) a dividend or other distribution with respect to, or in exchange for or in replacement of, the shares referenced in clauses (i) and (ii) above; excluding in all cases, however, any Registrable Securities sold by a Person in a transaction in which the applicable rights under this Agreement are not assigned pursuant to Subsection 6.1 , and excluding for purposes of Section 2   any shares for which registration rights have terminated pursuant to Subsection 2.12   of this Agreement.

1.22.     “ Requisite Holders ” means, as of any date and as to any provision of this Agreement, the holders (and their assignees) who have the benefit of the provision of this Agreement at issue, of at least two- thirds (2/3) of the Deemed Common Shares deemed owned by all such holders.

1.23.      “ Restricted Securities ” means the securities of the Company required to bear the legend set forth in Subsection 2.11(b) hereof.

1.24.    “ Sale of the Company ” means a Liquidation Event, as that term is defined in the Certificate of Amendment to the Company’s Certificate of Incorporation that creates the Existing Series C Preferred Stock.

1.25.     “ SEC ” means the Securities and Exchange Commission.

1.26.     “ SEC Rule 144 ” means Rule 144 promulgated by the SEC under the Securities Act.

1.27.     “ SEC Rule 145 ” means Rule 145 promulgated by the SEC under the Securities Act.

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

1.29.     “ Selling Expenses ” means all underwriting discounts, selling commissions, and stock transfer taxes applicable to the sale of Registrable Securities, and fees and disbursements of counsel for any Holder, except for the fees and disbursements of the Selling Holder Counsel borne and paid by the Company as provided in Subsection .

1.30.     “ Underlying Shares ” means the Conversion Shares and the Warrant Shares.

1.31.     “ Warrant ” or “ Warrants ” shall have the meaning given thereto in the Existing Series C Preferred Stock Purchase Agreement.

1.32.     " Warrant Shares " shall have the meaning given thereto in the Existing Series C Preferred Stock Purchase Agreement.

2.             Registration Rights . The Company covenants and agrees as follows:

2.1.          Registration .

(a)     If at any time when it is eligible to use a Form S-3 registration statement, the Company receives a request from Holders that the Company file a Form S-3 registration statement with respect to outstanding Registrable Securities of such Holders having an anticipated aggregate offering price of at least $500,000 (the “Initiating Holders”), then the Company shall (i) within ten (10) days after the date such request is given, give a Demand Notice to all Holders other than the Initiating Holders; and (ii) as soon as practicable, and in any event within sixty (60) days after the date such request is given by the Initiating Holders, file a Form S-3 registration statement under the Securities Act covering all Registrable Securities requested to be included in such registration by any other Holders, as specified by notice given by each such Holder to the Company within twenty (20) days of the date the Demand Notice is given, and in each case, subject to the limitations of Subsection 2.1(b) .

(b)     Notwithstanding the foregoing obligations, if the Company furnishes to Holders requesting a registration pursuant to this Subsection 2.1 a certificate signed by the Company’s chief executive officer stating that in the good faith judgment of the Company’s Board of Directors it would be materially detrimental to the Company and its stockholders for such registration statement to either become effective or remain effective for as long as such registration statement otherwise would be required to remain effective, because such action would (i) materially interfere with a significant acquisition, corporate reorganization, or other similar transaction involving the Company; (ii) require premature disclosure of material information that the Company has a bona fide business purpose for preserving as confidential, provided that the Company’s officers and directors are prohibited from trading in the Company’s securities during the same period; or (iii) render the Company unable to comply with requirements under the Securities Act or Exchange Act, then the Company shall have the right to defer taking action with respect to such filing, and any time periods with respect to filing or effectiveness thereof shall be tolled correspondingly, for a period of not more than one hundred twenty (120) days after the request of the Initiating Holders is given; provided , however , that the Company may not invoke this right more than once in any twelve (12) month period; and provided further that the Company shall not register any securities for its own account or that of any other stockholder during such one hundred twenty (120) day period other than an Excluded Registration.

2.2.          Limitation on Registration Rights . The Company shall not be obligated to effect, or to take any action to effect, any registration pursuant to Subsection 2.1(a) (i) during the period that is ninety (90) days before the Company’s good faith estimate of the date of filing of, and ending on a date that is one hundred eighty (180) days after the effective date of, a Company-initiated registration, provided, that the Company is actively employing in good faith commercially reasonable efforts to cause such registration statement to become effective; or (ii) if the Company has effected one registration pursuant to Subsection 2.1(a) during the twelve (12) month period immediately preceding the date of such request. A registration shall not be counted as “effected” for purposes of this Subsection 2.2 until such time as the applicable registration statement has been declared effective by the SEC, unless the Initiating Holders withdraw their request for such registration, and elect not to pay the registration expenses therefor that they are required to pay pursuant to Subsection 2.6 , in which case such withdrawn registration statement shall be counted as “effected” for purposes of this Subsection 2.2 .

2.3.           Underwriting Requirements .

(a)     If, pursuant to Subsection 2.1 , the Initiating Holders intend to distribute the Registrable Securities covered by their request by means of an underwriting, they shall so advise the Company as a part of their request made pursuant to Subsection 2.1 , and the Company shall include such information in the Demand Notice. The underwriter(s) will be selected by the Initiating Holders; provided, that such underwriter(s) shall be reasonably acceptable to the Company’s Board of Directors (such approval not to be unreasonably withheld, conditioned or delayed). In such event, the right of any Holder to include such Holder’s Registrable Securities in such registration shall be conditioned upon such Holder’s participation in such underwriting and the inclusion of such Holder’s Registrable Securities in the underwriting to the extent provided herein. All Holders proposing to distribute their securities through such underwriting shall (together with the Company as provided in Subsection 2.4 (e) ) enter into an underwriting agreement in customary form with the underwriter(s) selected for such underwriting. Notwithstanding any other provision of this Subsection 2.2, if the managing underwriter(s) advise(s) the Company in writing that marketing factors require a limitation on the number of shares to be underwritten, then the Company shall so advise all Holders of Registrable Securities that otherwise would be underwritten pursuant hereto, and the number of Registrable Securities that may be included in the underwriting shall be allocated among such Holders of Registrable Securities, including the Initiating Holders, in proportion (as nearly as practicable) to the number of Registrable Securities owned by each Holder or in such other proportion as shall mutually be agreed to by all such selling Holders; provided , however , that the number of Registrable Securities held by the Holders to be included in such underwriting shall not be reduced unless all other securities are first entirely excluded from the underwriting. To facilitate the allocation of shares in accordance with the above provisions, the Company or the underwriters may round the number of shares allocated to any Holder to the nearest 100 shares.

(b)     For purposes of Subsection 2.1 , a registration shall not be counted as “effected” if, as a result of an exercise of the underwriter’s cutback provisions in Subsection 2.2(a) , fewer than fifty percent (50%) of the total number of Registrable Securities that Holders have requested to be included in such registration statement are actually included.

2.4.          Obligations of the Company. Whenever required under this Section 2 to effect the registration of any Registrable Securities, the Company shall, as expeditiously as reasonably possible:

(a)     prepare and file with the SEC a registration statement with respect to such Registrable Securities and use its commercially reasonable efforts to cause such registration statement to become effective and, upon the request of the Holders of a majority of the Registrable Securities registered thereunder, keep such registration statement effective for a period of up to one hundred twenty (120) days or, if earlier, until the distribution contemplated in the registration statement has been completed; provided , however , that (i) such one hundred twenty (120) day period shall be extended for a period of time equal to the period the Holder refrains, at the request of an underwriter of Common Stock (or other securities) of the Company, from selling any securities included in such registration, and (ii) in the case of any registration of Registrable Securities on Form S-3 that are intended to be offered on a continuous or delayed basis, subject to compliance with applicable SEC rules, such one hundred twenty (120) day period shall be extended for up to eighteen (18) months, if necessary, to keep the registration statement effective until all such Registrable Securities are sold;

(b)     prepare and file with the SEC such amendments and supplements to such registration statement, and the prospectus used in connection with such registration statement, as may be necessary to comply with the Securities Act in order to enable the disposition of all securities covered by such registration statement;

(c)     furnish to the selling Holders such numbers of copies of a prospectus, including a preliminary prospectus, as required by the Securities Act, and such other documents as the Holders may reasonably request in order to facilitate their disposition of their Registrable Securities;

(d)     use its commercially reasonable efforts to register and qualify the securities covered by such registration statement under such other securities or blue-sky laws of such jurisdictions as shall be reasonably requested by the selling Holders; provided that the Company shall not be required to qualify to do business or to file a general consent to service of process in any such states or jurisdictions, unless the Company is already subject to service in such jurisdiction and except as may be required by the Securities Act;

(e)     in the event of any underwritten public offering, enter into and perform its obligations under an underwriting agreement, in usual and customary form, with the underwriter (s) of such offering;

(f)     use its commercially reasonable efforts to cause all such Registrable Securities covered by such registration statement to be listed on a national securities exchange or trading system and each securities exchange and trading system (if any) on which similar securities issued by the Company are then listed;

(g)     provide a transfer agent and registrar for all Registrable Securities registered pursuant to this Agreement and provide a CUSIP number for all such Registrable Securities, in each case not later than the effective date of such registration;

(h)     promptly make available for inspection by the selling Holders, any managing underwriter(s) participating in any disposition pursuant to such registration statement, and any attorney or accountant or other agent retained by any such underwriter or selected by the selling Holders, all financial and other records, pertinent corporate documents, and properties of the Company, and cause the Company’s officers, directors, employees, and independent accountants to supply all information reasonably requested by any such seller, underwriter, attorney, accountant, or agent, in each case, as necessary or advisable to verify the accuracy of the information in such registration statement and to conduct appropriate due diligence in connection therewith;

(i)     notify each selling Holder, promptly after the Company receives notice thereof, of the time when such registration statement has been declared effective or a supplement to any prospectus forming a part of such registration statement has been filed; and

(j)     after such registration statement becomes effective, notify each selling Holder of any request by the SEC that the Company amend or supplement such registration statement or prospectus.

2.5.        Furnish Information . It shall be a condition precedent to the obligations of the Company to take any action pursuant to this Section 2 with respect to the Registrable Securities of any selling Holder that such Holder shall furnish to the Company such information regarding itself, the Registrable Securities held by it, and the intended method of disposition of such securities as is reasonably required to effect the registration of such Holder’s Registrable Securities.

2.6.        Expenses of Registration . All expenses (other than Selling Expenses) incurred in connection with registrations, filings, or qualifications pursuant to Section 2 , including all registration, filing, and qualification fees; printers’ and accounting fees; fees and disbursements of counsel for the Company; and the reasonable fees and disbursements of one counsel for the selling Holders (“Selling Holder Counsel”), shall be borne and paid by the Company; provided , however , that the Company shall not be required to pay for any expenses of any registration proceeding begun pursuant to Subsection 2.1 if the registration request is subsequently withdrawn (other than because of material adverse information relating to the Company that is different from the information known or available, upon request from the Company or otherwise, to the Holders requesting registration at the time of their request for registration) at the request of the Holders of a majority of the Registrable Securities to be registered (in which case all selling Holders shall bear such expenses pro rata based upon the number of Registrable Securities that were to be included in the withdrawn registration), unless the Initiating Holders agree to forfeit their right to the registration for such twelve month period pursuant to Subsection 2.1 . All Selling Expenses relating to Registrable Securities registered pursuant to this Section 2 shall be borne and paid by the Holders pro rata on the basis of the number of Registrable Securities registered on their behalf.

2.7.         Delay of Registration . No Holder shall have any right to obtain or seek an injunction restraining or otherwise delaying any registration pursuant to this Agreement as the result of any controversy that might arise with respect to the interpretation or implementation of this Section 2 .

2.8.        Indemnification . If any Registrable Securities are included in a registration statement under this Section 2 :

(a)     To the extent permitted by law, the Company will indemnify and hold harmless each selling Holder, and the partners, members, officers, directors, and stockholders of each such Holder; legal counsel and accountants for each such Holder; any underwriter (as defined in the Securities Act) for each such Holder; and each Person, if any, who controls such Holder or underwriter within the meaning of the Securities Act or the Exchange Act, against any Damages, and the Company will pay to each such Holder, underwriter, controlling Person, or other aforementioned Person any legal or other expenses reasonably incurred thereby in connection with investigating or defending any claim or proceeding from which Damages may result, as such expenses are incurred; provided , however , that the indemnity agreement contained in this Subsection 2.8(a) shall not apply to amounts paid in settlement of any such claim or proceeding if such settlement is effected without the consent of the Company, which consent shall not be unreasonably withheld, nor shall the Company be liable for any Damages to the extent that they arise out of or are based upon actions or omissions made in reliance upon and in conformity with written information furnished by or on behalf of any such Holder, underwriter, controlling Person, or other aforementioned Person expressly for use in connection with such registration.

(b)     To the extent permitted by law, each selling Holder, severally and not jointly, will indemnify and hold harmless the Company, and each of its directors, each of its officers who has signed the registration statement, each Person (if any), who controls the Company within the meaning of the Securities Act, legal counsel and accountants for the Company, any underwriter (as defined in the Securities Act), any other Holder selling securities in such registration statement, and any controlling Person of any such underwriter or other Holder, against any Damages, in each case only to the extent that such Damages arise out of or are based upon actions or omissions made in reliance upon and in conformity with written information furnished by or on behalf of such selling Holder expressly for use in connection with such registration; and each such selling Holder will pay to the Company and each other aforementioned Person any legal or other expenses reasonably incurred thereby in connection with investigating or defending any claim or p roceeding from which Damages may result, as such expenses are incurred; provided , however , that the indemnity agreement contained in this Subsection 2.8(b) shall not apply to amounts paid in settlement of any such claim or proceeding if such settlement is effected without the consent of the Holder, which consent shall not be unreasonably withheld; and provided further that in no event shall the aggregate amounts payable by any Holder by way of indemnity or contribution under Subsections 2.8(b) and 2.8(d) exceed the proceeds from the offering received by such Holder (net of any Selling Expenses paid by such Holder), except in the case of fraud or willful misconduct by such Holder.

(c)     Promptly after receipt by an indemnified party under this Subsection 2.8 of notice of the commencement of any action (including any governmental action) for which a party may be entitled to indemnification hereunder, such indemnified party will, if a claim in respect thereof is to be made against any indemnifying party under this Subsection 2.8 , give the indemnifying party notice of the commencement thereof. The indemnifying party shall have the right to participate in such action and, to the extent the indemnifying party so desires, participate jointly with any other indemnifying party to which notice has been given, and to assume the defense thereof with counsel mutually satisfactory to the parties; provided , however , that an indemnified party (together with all other indemnified parties that may be represented without conflict by one counsel) shall have the right to retain one separate counsel, with the fees and expenses to be paid by the indemnifying party, if representation of such indemnified party by the counsel retained by the indemnifying party would be inappropriate due to actual or potential differing interests between such indemnified party and any other party represented by such counsel in such action. The failure to give notice to the indemnifying party within a reasonable time of the commencement of any such action shall relieve such indemnifying party of any liability to the indemnified party under this Subsection 2.8 , only to the extent that such failure materially prejudices the indemnifying party’s ability to defend such action. The failure to give notice to the indemnifying party will not relieve it of any liability that it may have to any indemnified party otherwise than under this Subsection 2.8 .

(d)     To provide for just and equitable contribution to joint liability under the Securities Act in any case in which either (i) any party otherwise entitled to indemnification hereunder makes a claim for indemnification pursuant to this Subsection 2.8 but it is judicially determined (by the entry of a final judgment or decree by a court of competent jurisdiction and the expiration of time to appeal or the denial of the last right of appeal) that such indemnification may not be enforced in such case, notwithstanding the fact that this Subsection 2.8 provides for indemnification in such case, or (ii) contribution under the Securities Act may be required on the part of any party hereto for which indemnification is provided under this Subsection 2.8 , then, and in each such case, such parties will contribute to the aggregate losses, claims, damages, liabilities, or expenses to which they may be subject (after contribution from others) in such proportion as is appropriate to reflect the relative fault of each of the indemnifying party and the indemnified party in connection with the statements, omissions, or other actions that resulted in such loss, claim, damage, liability, or expense, as well as to reflect any other relevant equitable considerations. The relative fault of the indemnifying party and of the indemnified party shall be determined by reference to, among other things, whether the untrue or allegedly untrue statement of a material fact, or the omission or alleged omission of a material fact, relates to information supplied by the indemnifying party or by the indemnified party and the parties’ relative intent, knowledge, access to information, and opportunity to correct or prevent such statement or omission; provided , however , that, in any such case, (x) no Holder will be required to contribute any amount in excess of the public offering price of all such Registrable Securities offered and sold by such Holder pursuant to such registration statement, and (y) no Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) will be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation; and provided further that in no event shall a Holder’s liability pursuant to this Subsection 2.8(d) , when combined with the amounts paid or payable by such Holder pursuant to Subsection 2.8(b) , exceed the proceeds from the offering received by such Holder (net of any Selling Expenses paid by such Holder ) , except in the case of willful misconduct or fraud by such Holder.

(e)     Notwithstanding the foregoing, to the extent that the provisions on indemnification and contribution contained in the underwriting agreement entered into in connection with the underwritten public offering are in conflict with the foregoing provisions, the provisions in the underwriting agreement shall control.

(f)     Unless otherwise superseded by an underwriting agreement entered into in connection with the underwritten public offering, the obligations of the Company and Holders under this Subsection 2.8 shall survive the completion of any offering of Registrable Securities in a registration under this Section 2 , and otherwise shall survive the termination of this Agreement.

2.9.        Reports Under Exchange Act . With a view to making available to the Holders the benefits of SEC Rule 144 and any other rule or regulation of the SEC that may at any time permit a Holder to sell securities of the Company to the public without registration or pursuant to a registration on Form S-3, the Company shall:

(a)     make and keep available adequate current public information, as those terms are understood and defined in SEC Rule 144;

(b)     use commercially reasonable efforts to file with the SEC in a timely manner all reports and other documents required of the Company under the Securities Act and the Exchange Act.

2.10.        “Market Stand-off” Agreement.

(a)     Each Holder hereby agrees that in connection with an underwritten public offering by the Company other than an Excluded Registration, it will not, without the prior written consent of the managing underwriter, during the period commencing on the date of the final prospectus relating to the registration by the Company of shares of its Common Stock under the Securities Act and ending on the date specified by the Company and the managing underwriter (such period not to exceed one hundred eighty (180) days, plus such additional period (not to exceed seventeen (17) days) as may be requested by the Company or an underwriter to accommodate regulatory restrictions on (1) the publication or other distribution of research reports and (2) analyst recommendations and opinions, including, but not limited to, the restrictions contained in FINRA Rule 2711(f)(4) or NYSE Rule 472(f)(4), or any successor provisions or amendments thereto), (i) lend; offer; pledge; sell; contract to sell; sell any option or contract to purchase; purchase any option or contract to sell; grant any option, right, or warrant to purchase; or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock or any securities convertible into or exercisable or exchangeable (directly or indirectly) for Common Stock held immediately before the effective date of the registration statement for such offering or (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of such securities, whether any such transaction described in clause (i) or (ii) above is to be settled by delivery of Common Stock or other securities, in cash, or otherwise. The foregoing provisions of this Subsection 2.10 shall not apply to the sale of any shares to an underwriter pursuant to an underwriting agreement, or the transfer of any shares to any trust for the direct or indirect benefit of the Holder or the immediate family of the Holder, provided that the trustee of the trust agrees to be bound in writing by the restrictions set forth herein, and provided further that any such transfer shall not involve a disposition for value, and shall be applicable to the Holders only if all officers and directors are subject to the same restrictions and the Company uses commercially reasonable efforts to obtain a similar agreement from all stockholders individually owning more than one percent (1%) of the Company’s outstanding Common Stock (after giving effect to conversion into Common Stock of all outstanding Derivative Securities). The underwriters in connection with such registration are intended third-party beneficiaries of this Subsection 2.10 and shall have the right, power, and authority to enforce the provisions hereof as though they were a party hereto. Each Holder further agrees to execute such agreements as may be reasonably requested by the underwriters in connection with such registration that are consistent with and no more burdensome to the Holders than, this Subsection 2.10 or that are necessary to give further effect thereto. Any discretionary waiver or termination of the restrictions of any or all of such agreements by the Company or the underwriters shall apply pro rata to all Holders subject to such agreements, based on the number of shares subject to such agreements. The provisions of this Subsection  shall not apply to any Person with respect to Common Stock of the Company acquired from a party to this Agreement or otherwise, in open market transactions.

(b)     In order to enforce the foregoing covenants of this Subsection 2.10 , the Company may impose stop-transfer instructions with respect to the Registrable Securities of each Holder (and transferees and assignees thereof) until the end of such lock-up period.

2.11.         Restrictions on Transfer .

(a)     The Series C Preferred Stock and the Registrable Securities shall not be sold, pledged, or otherwise transferred, and the Company shall not recognize and shall issue stop-transfer instructions to its transfer agent with respect to any such sale, pledge, or transfer, except upon the conditions specified in this Agreement, which conditions are intended to ensure compliance with the provisions of the Securities Act. A transferring Holder will cause any proposed purchaser, pledgee, or transferee of the Series C Preferred Stock and the Registrable Securities held by such Holder to agree to take and hold such securities subject to the provisions and upon the conditions specified in this Agreement.

(b)     Each certificate or instrument representing (i) the Series C Preferred Stock, (ii) the Registrable Securities, and (iii) any other securities issued in respect of the securities referenced in clauses (i) and (ii), upon any stock split, stock dividend, recapitalization, merger, consolidation, or similar event, shall (unless otherwise permitted by the provisions of Subsection 2.11(c) ) be stamped or otherwise imprinted with a legend substantially in the following form:

THE SECURITIES REPRESENTED HEREBY HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933. SUCH SHARES MAY NOT BE SOLD, PLEDGED, OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR A VALID EXEMPTION FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SAID ACT.

THE SECURITIES REPRESENTED HEREBY MAY BE TRANSFERRED ONLY IN ACCORDANCE WITH THE TERMS OF AN AGREEMENT BETWEEN THE COMPANY AND THE STOCKHOLDER, A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE COMPANY.

The Holders consent to the Company making a notation in its records and giving instructions to any transfer agent of the Restricted Securities in order to implement the restrictions on transfer set forth in this Subsection 2.11 .

(c)     The holder of each certificate representing Restricted Securities, by acceptance thereof, agrees to comply in all respects with the provisions of this Section 2 . Before any proposed sale, pledge, or transfer of any Restricted Securities, unless there is in effect a registration statement under the Securities Act covering the proposed transaction, the Holder thereof shall give notice to the Company of such Holder’s intention to effect such sale, pledge, or transfer. Each such notice shall describe the manner and circumstances of the proposed sale, pledge, or transfer in sufficient detail and, if reasonably requested by the Company, shall be accompanied at such Holder’s expense by either (i) a written opinion of legal counsel who shall, and whose legal opinion shall, be reasonably satisfactory to the Company, addressed to the Company, to the effect that the proposed transaction may be effected without registration under the Securities Act; or (ii) any other evidence reasonably satisfactory to counsel to the Company to the effect that the proposed sale, pledge, or transfer of the Restricted Securities may be effected without registration under the Securities Act, whereupon the Holder of such Restricted Securities shall be entitled to sell, pledge, or transfer such Restricted Securities in accordance with the terms of the notice given by the Holder to the Company. Each certificate or instrument evidencing the Restricted Securities transferred as above provided shall bear, except if such transfer is made pursuant to a registration statement or SEC Rule 144 or if, in the opinion of counsel for such Holder and the Company, such legend is not required in order to establish compliance with any provisions of the Securities Act, the appropriate restrictive legend set forth in Subsection 2.11(b) . Notwithstanding the foregoing, it is agreed that, provided that an opinion of counsel is not required by the Company’s transfer agent, (i) the Company shall not require opinions of counsel for transactions made pursuant to Rule 144 except in unusual circumstances, and (ii) no registration statement or opinion of counsel shall be necessary for a transfer without consideration by a Holder to an Affiliate of such Holder or without consideration by a Holder which is (A) a partnership to its partners or retired partners in accordance with partnership interests, (B) a corporation to its shareholders in accordance with their interest in the corporation, (C) a limited liability company to its members or former members in accordance with their interests in the limited liability company, (D) an individual Holder to such Holder’s Immediate Family Member or a trust for the benefit of the individual Holder or an Immediate Family Member thereof.

2.12.       Termination of Registration Rights . The right of any Holder to request registration or inclusion of Registrable Securities in any registration pursuant to Subsection 2.1 shall terminate upon the earliest to occur of: (a) the closing of a Sale of the Company; (b) dissolution of the Company or (c) such time as (i) Rule 144 or another similar exemption under the Securities Act is available for the sale of all of such Holder’s shares without limitation during a three-month period without registration and (ii) if requested by Purchaser and he has provided the necessary documentation, the Company has removed restrictive legends and stop transfer orders with respect to such shares, and the Company covenants to remove such restrictive legends promptly upon the furnishing of such documentation.

3.            Information and Observer Rights.

3.1.         Inspection Rights . Subject to Section 3.3 and 3.6 below, the Company shall permit, during normal business hours and upon reasonable request and reasonable notice, the Investor or any employees, agents or representatives thereof, so long as Investor has an Ownership Percentage of at least five percent (5%), for purposes reasonably related to Investor's interests as a stockholder to examine and make reasonable copies of and extracts from the records and books of account of, and visit and inspect the properties, assets, operations and business of the Company and any subsidiary, and to discuss the affairs, finances and accounts of the Company and any subsidiary with any of its officers, consultants, directors, and key employees.

3.2.         Reporting Requirements . If the Company ceases to file its periodic reports with the Commission, or if the Commission ceases making these periodic reports available via the Internet without charge, then at Investor's request the Company shall furnish the following to Investor so long as Investor has an Ownership Percentage of at least five percent (5%):

(a)     Quarterly Reports filed with the Commission on Form 10-Q as soon as available, and in any event within forty-five (45) days after the end of each of the first three fiscal quarters of the Company;

(b)     Annual Reports filed with the Commission on Form 10-K as soon as available, and in any event within ninety (90) days after the end of each fiscal year of the Company; and

(c)     Copies of all notices and information, including without limitation notices and proxy statements in connection with any meetings, that are provided to holders of shares of Common Stock, contemporaneously with the delivery of such notices or information to such holders of Common Stock.

3.3.      Observer Rights . As long as Investor (a) has an Ownership Percentage of at least five percent (5%), and (b) shall not be serving as a director of the Company or have a representative serving as director of the Company, the Company shall invite the Investor, or his representative, to attend all meetings of its Board of Directors in a nonvoting observer capacity and shall provide the Investor, or his representative with all information provided by the Company to the Board of Directors at the same time it is so provided; provided, however, that the Investor and such representative shall agree to hold in confidence and trust and to act in a fiduciary manner with respect to all information so provided; and provided further, that the Company reserves the right to withhold any information and to exclude the Investor and such representative from any meeting or portion thereof if access to such information or attendance at such meeting could adversely affect the attorney-client privilege between the Company and its counsel or result in disclosure of trade secrets that would not be precluded by the confidential information covenants of the Investor in this Agreement and any other confidential information agreement or other assurance that the Investor and any representative choose to provide, or a material conflict of interest, or if such Investor or its representative is a competitor of the Company. The Investor may voluntarily terminate the right set forth in this Section 3.3 by his written, signed election to do so, which election shall make reference to this Section 3.3.

3.4.       Appointment to the Board of Directors . As long as Investor has an Ownership Percentage of at least five percent (5%), at the Investor’s request, the Company will cause Investor (or a representative selected by the Investor) to be appointed to the Company’s Board of Directors (and, at the Investor’s request, reappointed to the Company’s Board of Directors annually) to serve until the following annual meeting of shareholders and until a successor is elected. The Investor may voluntarily terminate the right set forth in this Section 3.4 by his written, signed election to do so, which election shall make reference to this Section 3.4.

3.5.      Termination of Information . The covenants set forth in Subsections 3.1 , 3.2 , 3.3 and 3.4 shall terminate and be of no further force or effect upon the closing of a Sale of the Company or the dissolution of the Company, whichever event occurs first.

3.6.      Confidentiality . Investor and each Holder agrees to keep confidential and not disclose, divulge, or use for any purpose (other than to monitor and otherwise protect its interests with respect to its investment in the Company or as otherwise permitted by this Agreement) any material confidential information obtained from the Company pursuant to the terms of this Agreement (including notice of the Company’s intention to file a registration statement), unless such confidential information (a) is known or becomes known to the public in general (other than as a result of a breach of this Subsection 3.6 by such Investor), (b) is or has been independently developed or conceived by the Investor without use of the Company’s confidential information, or (c) is or has been made known or disclosed to the Investor or Holder by a third party without a breach of any obligation of confidentiality such third party may have to the Company, or (d) has been disclosed to another Person by the Company other than under a reservation of confidentiality; provided , however , that Investor or a Holder may disclose confidential information (i) to its attorneys, accountants, consultants, and other professionals to the extent necessary to obtain their services in connection with monitoring its investment in the Company; (ii) to any prospective purchaser of any Registrable Securities from such Investor, if such prospective purchaser agrees to be bound by the provisions of this Subsection 3.6 ; or (iii) as may otherwise be required by law, provided that the Investor or Holder promptly notifies the Company in advance of such disclosure and affords the Company the opportunity to take such steps as it may desire to minimize the extent of any such required disclosure.

4.          Rights to Future Stock Issuances .

4.1.       Right of First Offer . Subject to the terms and conditions of this Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company shall first offer such New Securities to the Investor, and then the other Purchasers.

(a)     The Company shall give notice (the “ Offer Notice ”) to the Purchasers, stating (i) its bona fide intention to offer such New Securities, (ii) the number of such New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such New Securities.

(b)     By notification to the Company within twenty (20) days after the Offer Notice is given, each Purchaser may elect to purchase or otherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such New Securities which equals the proportion that the Deemed Common Shares then attributable to such Purchaser based on Common Stock, Warrants or Series C Preferred Stock held of record by such Purchaser bears to the total Common Stock of the Company then outstanding (assuming full conversion and /or exercise, as applicable, of all Series C Preferred Stock and other Derivative Securities then outstanding). Each Purchaser shall have a right of over-allotment such that if any Purchaser fails to exercise its right hereunder to purchase its share of New Securities, the other Purchasers may purchase such non-purchasing Purchaser’s portion on a pro rata basis (or as they may otherwise agree among themselves) within ten (10) days from the date such non-purchasing Purchaser fails to exercise its right to purchase. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c) .

(c)     If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b) , the Company may, during the one hundred (180) day period following the expiration of the periods provided in Subsection 4.1(b) , offer and sell the remaining unsubscribed portion of such New Securities to any Person or Persons at a price not less than, and upon terms no more favorable to the offeree than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the New Securities within such period, or if such agreement is not consummated within thirty (30) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such New Securities shall not be offered unless first reoffered to the Purchasers in accordance with this Subsection 4.1 .

(d)     The right of first offer in this Subsection 4.1 shall not be applicable to Exempted Securities.

4.2.      Termination . The covenants set forth in Subsection 4.1 shall terminate and be of no further force or effect (a) immediately when the Purchasers collectively cease to have an Ownership Percentage of at least five percent (5%); or (b) upon the closing of a Sale of the Company, or (iii) upon the dissolution of the Company, whichever event occurs first.

5.            Additional Covenants .

5.1.         Investor Approvals . The Company shall not, directly or indirectly, do any of the following (or permit any subsidiary to do any of the following) without the written consent of the Investor:

(a)     create, sell, grant or issue any Compensatory Equity Interest;

(b)     reduce the per-share exercise or conversion price of any Derivative Security that is a Compensatory Equity Interest, other than pursuant to its terms;

(c)     create, incur, assume or guarantee any indebtedness for borrowed money in excess of $1,000,000 in the aggregate at any one time; or

(d)     guarantee the indebtedness of any third party for borrowed money except for trade accounts of the Company or any subsidiary arising in the ordinary course of business.

5.2.         Compensating Shares . In the event the Company shall at any time after the date hereof issue Compensatory Equity Interests in violation of Subsection 5.1(a) or breach Subsection 5.1(b) with the effect that additional equity interests are issuable as a result of such breach, then the Company shall be obligated to issue to each Purchaser immediately such aggregate number of additional shares of Common Stock (“ Compensating Shares ”) so that immediately following such violation such Purchaser’s Ownership Percentage shall equal his Ownership Percentage immediately prior to said violation. Such payments shall constitute the Purchaser’s exclusive monetary remedy for such events, but shall not affect the right of the Investor to seek injunctive relief. A Purchaser shall be deemed to have reconfirmed as to such Compensating Shares the representations and warranties set forth in Section 3 of the Purchase Agreement, and such Compensating Shares shall contain the restrictive legend set forth therein.

5.3.         Termination of Covenants . The covenants set forth in Subsection 5.1 , shall terminate and be of no further force or effect (a) immediately when the Investor ceases to have an Ownership Percentage of at least five percent (5%); (b) upon the closing of a Sale of the Company or (c) upon the dissolution of the Company, whichever occurs first.

6.            Miscellaneous .

6.1.         Successors and Assigns .

(a)      A Holder’s rights under Section 2 of this Agreement may be assigned (but only with all related obligations) to a transferee of Registrable Securities that (i) is an Affiliate of a Holder; (ii) is a Holder’s Immediate Family Member or trust for the benefit of an individual Holder or one or more of such Holder’s Immediate Family Members and, in the case of B. Thomas Golisano only, The Golisano Foundation; or (iii) after such transfer, holds shares of Registrable Securities representing at least 500,000 shares of Common Stock (subject to appropriate adjustment for stock splits, stock dividends, combinations, and other recapitalizations); provided , however , that (x) the Company is, within a reasonable time after such transfer, furnished with written notice of the name and address of such transferee and the Registrable Securities with respect to which such rights are being transferred; and (y) such transferee agrees in a written instrument delivered to the Company to be bound by and subject to the terms and conditions of this Agreement, including the provisions of Subsection 2.10 . For the purposes of determining the number of shares of Registrable Securities held by a transferee, the holdings of a transferee (1) that is an Affiliate or stockholder of a Holder; (2) who is a Holder’s Immediate Family Member; or (3) that is a trust for the benefit of an individual Holder or such Holder’s Immediate Family Member shall be aggregated together and with those of the transferring Holder; provided further that all transferees who would not qualify individually for assignment of rights shall have a single attorney-in-fact for the purpose of exercising any rights, receiving notices, or taking any action under this Agreement.

(b)     A Purchaser’s rights under Section  may be assigned to a Person who acquires in such assignment beneficial ownership of at least Five Hundred Thousand (500,000) Deemed Common Shares; provided, however, that (x) the Company is, within a reasonable time after such transfer, furnished with written notice of the name and address of such transferee and the Deemed Common Shares with respect to which such rights are being transferred; and (y) such transferee agrees in a written instrument delivered to the Company to be bound by and subject to the terms and conditions of this Agreement, as applicable to the rights being assigned.

(c)     A Purchaser’s rights under Subsection 5.2 may be assigned to a Person who acquires in such assignment beneficial ownership of at least One Hundred Thousand (100,000) Deemed Common Shares, provided, however, that (x) the Company is, within a reasonable time after such transfer, furnished with written notice of the name and address of such transferee and the Deemed Common Shares with respect to which such rights are being transferred; and (y) such transferee agrees in a written instrument delivered to the Company to be bound by and subject to the terms and conditions of this Agreement, as applicable to the rights being assigned.

(d)     Without limiting any other provision of this Agreement, the Investor may assign any rights and all under this Agreement to an Affiliate of the Investor.

(e)     Except as set forth in Subsections 6.1(a), 6.1(b) 6.1(c) and 6.1(d) , this Agreement and the rights hereunder shall not be assignable or transferable by the Purchasers or the Company. Subject to the preceding sentence, the terms and conditions of this Agreement shall be binding upon, inure to the benefit of and be enforceable by the respective successors and permitted assignees of the parties. Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and permitted assignees any rights, remedies, obligations or liabilities under or by reason of this Agreement, except as expressly provided herein.

6.2.      Governing Law . This Agreement shall be deemed to be a contract made under, and shall be construed in accordance with, the laws of the State of New York, without giving effect to conflict of laws principles thereof.

6.3.      Waiver of Jury Trial . EACH PARTY HERETO ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE IT HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT AND THE OTHER TRANSACTION DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

6.4.      Counterparts . This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Counterparts may be delivered via facsimile, electronic mail (including .pdf) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.

6.5.      Titles and Subtitles . The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.

6.6.      Notices . Any notice or demand which is required or provided to be given under this Agreement shall be deemed to have been sufficiently given and received for all purposes when delivered in writing by hand, telecopy, telex, facsimile, email or other method of electronic delivery, or five (5) days after being sent by certified or registered mail, postage and charges prepaid, return receipt requested, or two (2) days after being sent by overnight delivery providing receipt of delivery, to the following addresses: If to the Company, it shall be sent to: Torvec Inc., 1999 Mt. Read Boulevard, Building 3, Rochester, NY 14615, Attention: Chief Executive Officer, Fax: 585-254-1105, Email: dickk@torvec.com, with copies (which shall not constitute notice) to (Torvec Inc., 1999 Mt. Read Boulevard, Building 3, Rochester, NY 14615, Attention: General Counsel, Fax: 585-254-1105, Email: dsullivan@torvec.com; if to the Investor, to: B. Thomas Golisano, 3175 Green Dolphin Lane, Naples, Florida 34102, Fax: 585-383-3428, Email: tgolisano@bluetie.com, with a copy to (which shall not constitute notice), Fisher Asset Management, 1 Fishers Road, Pittsford, NY 14534, Attention: David Still, Fax: 585-340-1202, Email: dstill@golisanofoundation.org, if to Charles T. Graham, to: 10 Turtle Creek, Pittsford, NY 14534, Fax: _____________, Email: ___________________; if to David Still, to: 18 Wrenfield Lane, Pittsford, NY 14534, Fax: 585-340-1202, Email: dstill@golisanofoundation.org.

6.7.      Amendments and Waivers . Any term of this Agreement may be amended and the observance of any term of this Agreement may be waived (either generally or in a particular instance, and either retroactively or prospectively) only with the written consent of (a) the Company, and (b) the Requisite Holders; provided , that the Company may in its sole discretion waive compliance with Subsection 2.11(c) ; and provided further that any provision hereof may be waived by any waiving party on such party’s own behalf, without the consent of any other party. The Company shall give prompt notice of any amendment or termination hereof or waiver hereunder to any party hereto that did not consent in writing to such amendment, termination, or waiver. Any amendment, termination, or waiver effected in accordance with this Subsection 6.7 shall be binding on all parties hereto, regardless of whether any such party has consented thereto. No waivers of or exceptions to any term, condition, or provision of this Agreement, in any one or more instances, shall be deemed to be or construed as a further or continuing waiver of any such term, condition, or provision.

6.8.          Severability . The invalidity or unenforceability of any provision hereof shall in no way affect the validity or enforceability of any other provision.

6.9.        Aggregation of Stock . All shares of Registrable Securities held or acquired by Affiliates shall be aggregated together for the purpose of determining the availability of any rights under this Agreement and such Affiliated persons may apportion such rights as among themselves in any manner they deem appropriate.

6.10.      Entire Agreement; Termination of Prior Agreements . This Agreement (including any Schedules and Exhibits hereto) constitutes the full and entire understanding and agreement among the parties with respect to the subject matter hereof, and any other written or oral agreement relating to the subject matter hereof existing between the parties is expressly canceled; provided however, that for the avoidance of doubt, that certain Securities Purchase Agreement dated as of September 23, 2011, between the Company and the Purchasers (the “ Existing Series C Preferred Stock Purchase Agreement ”) is not canceled by this Agreement. Upon the effectiveness of this Agreement, the Prior Agreement shall be deemed amended and restated and superseded and replaced in its entirety by this Agreement, and shall be of no further force or effect.

6.11.      Delays or Omissions . No delay or omission to exercise any right, power or remedy accruing to any party under this Agreement, upon any breach or default of any other party under this Agreement, shall impair any such right, power or remedy of such non-breaching or non-defaulting party nor shall it be construed to be a waiver of any such breach or default, or an acquiescence therein, or of or in any similar breach or default thereafter occurring; nor shall any waiver of any single breach or default be deemed a waiver of any other breach or default theretofore or thereafter occurring. Any waiver, permit, consent or approval of any kind or character on the part of any party of any breach or default under this Agreement, or any waiver on the part of any party of any provisions or conditions of this Agreement, must be in writing and shall be effective only to the extent specifically set forth in such writing. All remedies, either under this Agreement or by law or otherwise afforded to any party, shall be cumulative and not alternative.

6.12.      Non-Circumvention . The Company will not, by amendment of its Certificate of Incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the covenants or agreements to be observed or performed by it under this Agreement, but will at all times in good faith assist in the carrying out of all such provisions and in the taking of all such action as may be necessary or appropriate in order to protect the rights of the Purchasers against impairment.

[ Remainder of Page Intentionally Left Blank ]

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.

THE COMPANY :

TORVEC, INC.

By: /s/ Richard A. Kaplan                    

      Richard A. Kaplan, Chief Executive Officer

INVESTOR :

/s/ Thomas Golisano                          

B. Thomas Golisano

ADDITIONAL INVESTORS :

/s/ Charles T. Graham                         

Charles T. Graham

/s/ David Still                              

David Still