WARRANT AGREEMENT

Exhibit 4.2

WARRANT AGREEMENT

Dated as of May 18, 2009

by and between

Grubb & Ellis Company

and

Deutsche Bank Trust Company Americas

Fifth Third Bank

JPMorgan Chase, N.A.

KeyBank National Association

WARRANT AGREEMENT

TABLE OF CONTENTS

EXHIBIT A — Form of Warrant Certificate

EXHIBIT B — Allocation of Warrants

WARRANT AGREEMENT

          WARRANT AGREEMENT (this “ Warrant Agreement ”) dated as of May 18, 2009 by and between Grubb & Ellis Company, a Delaware corporation (the “ Company ”), and the Holders listed in Exhibit B.

          WHEREAS, the Company is issuing the Warrants in accordance with that certain Third Amended and Restated Credit Agreement, dated as of the date hereof (the “ Credit Facility ”), by and among Company, the guarantors named therein, the lenders named therein, Deutsche Bank Trust Company Americas, as syndication agent, Deutsche Bank Securities Inc., as sole book-running manager and sole lead arranger, and Deutsche Bank Trust Company Americas, as initial issuing bank, swing line bank and administrative agent; and

          WHEREAS, the Warrants entitle the holders of such Warrants, upon proper exercise, during the Exercise Period (as defined in Section 1 ), to receive from the Company such number of shares (the “ Warrant Shares ”) of Company’s common stock, par value $0.01 per share (each, a “ Share ”) at a price of $0.01 per Share (the “ Exercise Price ”), that, in the aggregate, after giving effect to the Shares issuable upon the exercise of the Warrants, on October 1, 2009, constitute fifteen percent (15%) of the issued and outstanding Shares of the Company on a fully diluted basis. The number of Warrant Shares and the Exercise Price shall be subject to adjustment as provided herein. The Warrants shall be allocated among the Holders as provided on Exhibit B hereto.

          NOW, THEREFORE, in consideration of the premises and the mutual agreements herein set forth, the parties hereto agree as follows:

     SECTION 1. Defined Terms .

          “ Affiliate ” shall mean, with respect to any specified Person, any other Person that directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, such specified Person. The term “control” (including the terms “controlled by”, “controlling” and “under common control with”) shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, as trustee or executor, by contract or otherwise, including, without limitation, the ownership, directly or indirectly, of securities having the power to elect a majority of the board of directors or similar body governing the affairs of such Person.

          “ Additional Shares ” shall mean all Shares issued or sold by the Company on or after the date hereof.

          “ Administrative Agent ” shall have the meaning set forth in the Credit Facility.

          “ Bank Holding Company Affiliate ” shall mean, with respect to any Holder that is a BHCA Holder, (a) if such Holder is a bank holding company, any company controlled by such bank holding company or (b) the bank holding company that controls such Holder and any other Person controlled by such bank holding company.

          “ BHCA Holder ” shall mean a bank holding company or a subsidiary of a bank holding company.

          “ Blackout Period ” shall have the meaning set forth in Section 18.3 of this Warrant Agreement.

          “ Business Day ” shall mean any day other than a Saturday, Sunday or a day on which commercial banks in the City of New York are authorized or required by law to close.

          “ Capital Stock ” shall mean (a) with respect to any Person that is a corporation, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock; and (b) with respect to any other Person, any and all partnership, membership or other equity interests of such Person.

          “ Code ” shall mean the Internal Revenue Code of 1986, as amended.

          “ Commitments ” shall have the meaning set forth in the Credit Facility.

          “ Company ” shall have the meaning set forth in the preamble hereto.

          “ Credit Facility ” shall have the meaning set forth in the preamble hereto.

          “ Convertible Securities ” shall mean evidences of indebtedness or Equity Interests which are convertible into or exchangeable or exercisable for Additional Shares, either immediately or upon the arrival of a specified date or the happening of a specified event.

          “ Convertible Security Value ” shall mean the fair market value of a Convertible Security on the date of issuance, determined in good faith by the Company on a reasonable basis, less the proceeds received by the Company for such conversion or exchange.

          “ Current Market Price ” per Share on any date specified herein, shall mean the average daily Market Price during the period of the most recent twenty (20) days, ending on such date, on which the national securities exchanges were open for trading, except that if no Shares are then listed or admitted to trading on any national securities exchange or quoted in the over-the-counter market, the Current Market Price shall be the Market Price on such date.

          “ Demand for Registration ” shall have the meaning set forth in Section 18.2 of this Warrant Agreement.

          “ Demand Registration ” shall have the meaning set forth in Section 18.2 of this Warrant Agreement.

          “ Demand Registration Statement ” shall have the meaning set forth in Section 18.2 of this Warrant Agreement.

          “ Equity Interests ” shall mean Capital Stock or warrants, options or other rights to acquire Capital Stock.

          “ Exchange Act ” shall mean the Securities Exchange Act of 1934, as amended, and any similar or successor federal statute, and the rules and regulations of the SEC thereunder, all as the same shall be in effect at any applicable time.

          “ Exempt Issuances ” shall mean:

          (a) the grant or issuance of the Warrants or the issuance of any Warrant Shares upon exercise of any Warrant; or

          (b) issuances or grants which are approved by each Holder as not being subject to the anti-dilution provisions set forth in this Warrant Agreement.

          “ Exercise Date ” shall have the meaning set forth in Section 7.8 of this Warrant Agreement.

          “ Exercise Period ” shall mean the period commencing on October 1, 2009 and continuing until 5:00 p.m. New York City time on September 30, 2019.

          “ Exercise Price ” shall mean, on the date hereof, the purchase price per Share as set forth in the recitals hereto, and thereafter shall mean such dollar amount as shall result from the adjustment specified in Section 8 .

          “ Expiration Date ” shall mean the earlier of (a) 5:00 p.m. New York City time on September 30, 2019, or (b) if the Company completes the Recapitalization Plan, the date such Recapitalization Plan was completed.

          “ FINRA ” shall mean the Financial Industry Regulatory Authority, Inc.

          “ Holder ” shall mean any Person that is or Persons that are the registered holder(s) of the Warrants or Warrant Shares as registered on the Warrant register maintained by the Company in accordance with this Warrant Agreement.

          “ KV Agreement ” shall mean that certain registration rights agreement dated as of April 28, 2006 by and among the Company, Kojaian Ventures L.L.C. and Kojaian Holdings, LLC.

          “ KV Registration Rights ” shall mean those certain registration rights with respect to the Company’s securities as set forth in the KV Agreement.

          “ Lender ” shall have the meaning set forth in the Credit Facility.

          “ Loans ” shall mean the aggregate principal amount of loans made under the Credit Facility.

          “ Majority Holders ” shall mean Holders of Warrants evidencing a majority in number of the total number of Shares at the time purchasable upon the exercise of all then outstanding Warrants.

          “ Market Price ” shall mean, on any date specified herein, the amount per Share equal to (a) if Shares are then listed or admitted to trading on any national securities exchange, the last sale price of such Share on such date or, if no such sale takes place on such date, the average of the closing bid and asked prices thereof on such date, in each case as officially reported on the principal national securities exchange on which the Shares are then listed or admitted to trading, (b) if Shares are not then listed or admitted to trading on any national securities exchange but are designated as a national market system security by FINRA, the last trading price of the Shares on such date, (c) if there shall have been no trading on such date or if the Shares are not so designated, the average of the closing bid and asked prices of the Shares on such date as shown by FINRA automated quotation system, or (d) if Shares are not then listed or admitted to trading on any national exchange or quoted in the over-the-counter market, the fair value thereof determined by a nationally recognized investment bank selected by the Company and reasonably acceptable to the Holders.

          “ Maximum Number of Demand Securities ” shall have the meaning set forth in Section 18.2 of this Warrant Agreement.

          “ Maximum Number of Securities ” shall have the meaning set forth in Section 18.1 of this Warrant Agreement.

          “ Officers ” shall mean, with respect to any Person, the Chairman of the Board, the Chief Executive Officer, the Chief Financial Officer, the President, the Treasurer, any Assistant Treasurer, the Controller, the Secretary, any Assistant Secretary, or any Vice-President.

          “ Option ” shall mean any warrant, option or other right to subscribe for or purchase Additional Shares or Convertible Securities.

          “ Other Securities ” shall mean any Shares (other than Warrant Shares) and other Equity Securities of the Company or any other Person (corporate or otherwise) which a Holder at any time shall be entitled to receive, or shall have received, upon exercise of the Warrants held by such Holder or pursuant to Section 10 hereof, in lieu of or in addition to Warrant Shares, or which at any time shall be issuable or shall have been issued in exchange for or in replacement of Warrant Shares or Other Securities received in an earlier exchange, exercise or replacement of Warrant Shares.

          “ Participating Demand Holders ” shall have the meaning set forth in Section 18.2 of this Warrant Agreement.

          “ Participating Piggy-Back Holders ” shall have the meaning set forth in Section 18.1 of this Warrant Agreement.

          “ Person ” shall include an individual, a corporation, an association, a partnership, a limited liability company, a trust or estate, a government, foreign or domestic, and any agency or political subdivision thereof, or any other entity.

          “ Piggy-Back Registration ” shall have the meaning set forth in Section 18.1 of this Warrant Agreement.

          “ Piggy-Back Registration Statement ” shall have the meaning set forth in Section 18.1 of this Warrant Agreement.

          “ Qualified Purchaser ” shall mean any institutional “Accredited Investor” as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act.

          “ Recapitalization Plan ” shall have the meaning set forth in the Credit Facility.

          “ Registrable Securities ” shall mean any Warrant Shares and any securities or class of securities issued or issuable with respect to any Warrant Shares by way of a split, dividend, or other division of securities, or in connection with a combination of securities, conversion, exchange, replacement, recapitalization, merger, consolidation, or other reorganization or otherwise.

          “ Registration Statement ” shall mean a Demand Registration Statement, a Piggy-Back Registration Statement and/or a Shelf Registration Statement, as the case may be.

          “ Required Lenders ” shall have the meaning set forth in the Credit Facility, except that “majority in interest” shall be substituted with “66 2/3% in interest.”

          “ SEC ” shall mean the Securities and Exchange Commission.

          “ Securities Act ” shall mean the Securities Act of 1933, as amended, and any similar or successor federal statute, and the rules and regulations of the SEC thereunder, all as the same shall be in effect at any applicable time.

          “ Shares ” shall have the meaning set forth in the preamble hereto.

          “ Shelf Registration Statement ” shall have the meaning set forth in Section 18.2 of this Warrant Agreement.

          “ Total Holders’ Interest ” shall mean a special economic interest in the Company entitling the Holders to receive fifteen percent (15%) of the aggregate Shares in the Company, on the fully diluted basis, as such number of Shares representing such right is adjusted in accordance with Section 9 of this Warrant Agreement.

          “ Transfer ” shall have the meaning set forth in Section 6.1 of this Warrant Agreement.

          “ Transfer Agent ” shall have the meaning set forth in Section 13.2 of this Warrant Agreement.

          “ Voting Stock ” shall mean any equity security entitling the holder of such security to vote at meetings of shareholders except an equity security which entitles the holder of such security to vote only upon the occurrence of some contingency, unless that contingency shall have occurred and be continuing.

          “ Warrants ” shall mean the warrants issued pursuant to this Warrant Agreement and represented by Warrant Certificates, and all warrants issued upon transfer, division or combination of, or in substitution thereof.

          “ Warrant Agreement ” shall have the meaning set forth in the preamble hereto.

          “ Warrant Certificates ” shall have the meaning set forth in Section 2 of this Warrant Agreement.

          “ Warrant Shares ” shall have the meaning set forth in the preamble hereto.

     SECTION 2. Warrant Certificates . The certificates evidencing the Warrants to be delivered pursuant to this Warrant Agreement shall be in registered form only and shall be substantially in the form set forth in Exhibit A attached hereto (“ Warrant Certificates ”) and may have such letters, numbers, or other marks of identification or designation and such legends or endorsements printed, lithographed or engraved thereon as the Officers of the Company executing the same may approve (with execution thereof to be conclusive evidence of such approval) and as are not inconsistent with the provisions of this Warrant Agreement, or as may be required to comply with any applicable law or with any rule or regulation made pursuant thereto or with any rule or regulation of any exchange, inter-dealer quotation system or regulated quotation service on which the Warrants or the Shares may be listed or quoted, as the case may be.

     SECTION 3. Issuance of Warrants . Upon issuance in accordance with Section 6 , each Warrant Certificate shall evidence one or more Warrants. Each Warrant evidenced thereby entitles the Holder,

upon proper exercise to receive from the Company the stated number of Warrant Shares at the Exercise Price, as adjusted as provided herein.

     SECTION 4. Execution of Warrant Certificates .

          4.1 Execution by an Officer of the Company . Warrant Certificates shall be signed on behalf of the Company by any Officer thereof under its corporate seal. The seal of the Company may be in the form of a facsimile thereof and may be impressed, affixed, imprinted or otherwise reproduced on the Warrant Certificates. The Warrant Certificates may be executed in any number of original, facsimile or electronic counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instruments; provided, however if the Warrant Certificate is executed in counterparts, the corporate seal may be imprinted on only one such counterpart. Each such signature upon any Warrant Certificate may be of the present or any future Officer of the Company, notwithstanding the fact that at the time any Warrant Certificate shall be delivered or disposed of by the Company such Officer shall have ceased to hold such office, so long as, and the Company hereby represents that, under the Company’s Certificate of Incorporation and By-Laws, any Warrants or Warrant Shares so issued would be validly issued. Any Warrant Certificate may be signed on behalf of the Company by any Person who, at the actual date of the execution of such Warrant Certificate, shall be a proper Officer of the Company to sign such Warrant Certificate, although at the date of the execution of this Warrant Agreement any such Person was not such Officer, so long as, and the Company hereby represents that, under the Company’s Certificate of Incorporation and By-Laws, any Warrants or Warrant Shares so issued would be validly issued.

          4.2 Date of Warrant Certificate . Warrant Certificates shall be dated the date of execution by the Company and shall represent one or more whole Warrants.

     SECTION 5. Registration and Countersignature .

          5.1 Warrant Register . The Company shall number and register the Warrant Certificates in a Warrant register as they are issued by the Company. The Warrant register will show the names and addresses of the Holders, the numbers of Warrants and Warrant Shares evidenced on the face of each Warrant Certificate and the date of each Warrant Certificate.

          5.2 Absolute Ownership . The Company may deem and treat the Holders as the absolute owner(s) of the Warrant Certificates (notwithstanding any notation of ownership or other writing thereon made by anyone), for all purposes, and the Company shall not be affected by any notice to the contrary.

     SECTION 6. Transfers and Exchanges.

          6.1 Limitation on Transfers.

          (a) A Holder may not transfer, assign or encumber all or any part of this Warrant (including through the grant of participation interests) (a “ Transfer ”).

          (b) Notwithstanding the foregoing, a Holder may Transfer all or any portion of this Warrant to (i) any of its Affiliates or (ii) any Qualified Purchaser who is also a Lender under the Credit Facility; provided however that any such transfer pursuant to clause (b)(ii) would not, after giving effect to such transfer, result in such transferee owning a greater or a lesser percentage of outstanding Warrants than such transferee’s pro rata share of Commitments under the Credit Facility, and provided further that in each case (i) and (ii) above the transferee shall agree in writing to be bound by the terms of this

Warrant Agreement, and such transfer shall be in compliance with Section 23A of the Federal Reserve Act and the Securities Act or any state (or other jurisdiction) securities or “blue sky” laws applicable to the Company or the Warrants. Notwithstanding the foregoing, (x) upon receipt of the consent of the Administrative Agent and Required Lenders or (y) so long as all obligations under the Credit Facility have been repaid or terminated, a Holder may transfer all or any portion of this Warrant to any Qualified Purchaser without any limitations on the number of Warrants so transferred imposed by clause (b)(ii) above.

          (c) Any purported Transfer other than in accordance with the terms of this Warrant Agreement shall be null and void, and the Company shall refuse to recognize any such Transfer for any purpose and shall not reflect in its records any change in record ownership pursuant to any such Transfer.

          6.2 Registration of Transfers . The Company shall from time to time register the transfer of any outstanding Warrant Certificates upon the records to be maintained by it for that purpose, upon surrender thereof accompanied by a written instrument or instruments of transfer in form satisfactory to the Company, duly executed by the Holders thereof or by the duly appointed legal representative thereof or by a duly authorized attorney. Upon any such registration of transfer, a new Warrant Certificate shall be issued to the transferee(s) and the surrendered Warrant Certificate shall be cancelled by the Company. Cancelled Warrant Certificates shall thereafter be disposed of by or at the direction of the Company in accordance with applicable law.

          6.3 Exchange of Warrant Certificates . Warrant Certificates may be exchanged at the option of the Holder(s), when surrendered to the Company during normal business hours for another Warrant Certificate or other Warrant Certificates of like tenor and representing in the aggregate a like number of Warrants. Warrant Certificates surrendered for exchange shall be cancelled by the Company. Such cancelled Warrant Certificates shall then be disposed of by the Company in accordance with applicable law.

     SECTION 7. Exercise of Warrants .

          7.1 Exercise of Warrants . A Warrant may be exercised upon surrender to the Company of the Warrant Certificate or Warrant Certificates evidencing the Warrants to be exercised with the form of election to purchase on the reverse thereof duly completed and signed, and upon payment to the Company of the Exercise Price, as adjusted from time to time as provided herein, for each Warrant Share then purchased. Payment of the aggregate Exercise Price for all Warrant Shares being purchased in respect of a Warrant shall be made (a) by wire transfer of immediately available funds in United States Dollars or (b) by certified or official bank check for United States Dollars made payable to the order of the Company. Each Warrant not exercised prior to the Expiration Date shall become void and all rights thereunder and all rights in respect thereof under this Warrant Agreement shall cease as of such time.

          7.2 Issuance of Certificates Representing Shares . Upon such surrender of Warrants and payment of the aggregate Exercise Price, the Company shall issue and cause to be delivered promptly to or upon the written order of the Holder and in such name or names, as the Holder may designate, a certificate or certificates for the number of full Warrant Shares issuable upon the exercise of such Warrants. Such certificate or certificates shall be deemed to have been issued and any person so designated to be named therein shall be deemed to have become a Holder of such Warrant Shares as of the date of the surrender of such Warrants and payment of the aggregate Exercise Price.

          7.3 Issuance of New Warrant Certificates . The Warrants shall be exercisable at the election of the Holders either in full or from time to time in part (in whole Warrant Shares) and, in the event that a Warrant Certificate evidencing Warrants is exercised in respect of fewer than all of the

Warrant Shares issuable on such exercise at any time prior to the Expiration Date, a new Warrant Certificate evidencing the remaining Warrant or Warrants will be promptly issued, and the Company, whenever required under this Warrant Agreement, will provide Warrant Certificates duly executed on behalf of the Company for such purpose.

          7.4 Cancellation of Warrant Certificates . All Warrant Certificates surrendered upon exercise of Warrants shall be cancelled and disposed of by the Company in accordance with applicable law.

          7.5 Warrant Agreement . The Company shall keep copies of this Warrant Agreement and any notices given or received hereunder available for inspection by the Holders of the Warrants during normal business hours at its office. The Company shall supply the Holder from time to time with such numbers of copies of this Warrant Agreement as the Holders may request.

          7.6 Alternative Cashless Exercise . Notwithstanding any provision herein to the contrary, in lieu of exercising a Warrant as set forth above, a Holder may exercise a Warrant by electing to receive that number of Shares as determined below by surrendering to the Company such Warrant, with the applicable election to purchase Shares duly completed and signed by the Holder, in which event the Company shall issue to the Holder the number of Shares computed using the following formula:

where:

     “ CS ” equals the number of Shares to be issued to the Holder;

     “ WCS ” equals the number of Warrant Shares purchasable under the Warrant or, if only a portion of the Warrant is being exercised, the portion of the Warrant being exercised;

     “ MP ” equals the Current Market Price per Share; and

     “ PP ” equals the Exercise Price.

Following the surrender of any Warrant pursuant to this Section 7.6 , the Company shall promptly record the name of the Holder in the Warrant register for that number of Shares, as calculated above in such name or names as may be designated by such Holder.

          7.7 Fractional Shares . The Company shall not be required to issue fractional Warrant Shares on the exercise of any Warrant. If more than one Warrant shall be presented for exercise in full at the same time by the same Holder, the number of full Warrant Shares which shall be issuable upon the exercise thereof shall be computed on the basis of the aggregate number of Warrant Shares purchasable on exercise of the Warrants so presented. If any fraction of a Warrant Share would, except for the provisions of this Section 7.7 be issuable on the exercise of any Warrants (or specified portion thereof), the Company shall pay an amount in cash equal to the Market Price multiplied by such fraction.

          7.8 When Exercise Effective . The exercise of any Warrant shall be deemed to have been effective immediately prior to the close of business on the Business Day on which such Warrant is surrendered to and the Exercise Price is received by the Company as provided in this Section 7 (the

“ Exercise Date ”) and the Person in whose name the Shares shall be issuable upon such exercise shall be deemed to be the Holder of such Shares for all purposes on the Exercise Date.

          7.9 Continued Validity . A Holder of Shares issued upon the exercise of any Warrant, in whole or in part, shall continue to be entitled to all of the rights and subject to all of the obligations set forth in the Company’s Certificate of Incorporation and By-Laws.

          7.10 BHCA Holders . If a Holder is a BHCA Holder, unless such Holder is a financial holding company and exercises such Warrant in reliance on, and in compliance with, the merchant banking exemption set forth in Regulation Y, such Holder shall not, and shall not permit any of its Bank Holding Company Affiliates to, exercise any Warrant if, after giving effect to such exercise, (a) such Holder and its Bank Holding Company Affiliates would own more than five percent (5%) of the total issued and outstanding Shares on a fully-diluted basis or (b) such Holder would be deemed under Regulation Y to have the power to exercise, directly or indirectly, a controlling influence over the management or policies of, or would otherwise control, the Company. For purposes of clause (b) of this Section 7.10 , a reasoned opinion of counsel to such Holder delivered to such Holder (which is based on facts and circumstances deemed appropriate by such counsel) to the effect that such Holder does not have the power to exercise such a controlling influence or otherwise control the Company shall be conclusive.

     SECTION 8. Adjustment of Number of Warrant Shares Purchasable and Exercise Price . The number of Warrant Shares purchasable upon exercise of the Warrants and the Exercise Price shall be subject to adjustment from time to time as set forth in this Section 8 . All of the adjustments referred to in this Section 8 shall only apply to Warrants which have not yet been exercised and shall not apply to Exempt Issuances. The Company shall not create any class of Shares which carries any rights to dividends or assets differing in any respect from the rights of the Shares, except as such classes of Shares, if any, may be in existence on the date hereof.

          8.1 Share Dividends, Subdivisions and Combinations. If at any time the Company shall:

          (a) declare or pay a dividend payable in Additional Shares;

          (b) subdivide or reclassify its outstanding Shares into a greater number of Shares; or

          (c) combine or reclassify its outstanding Shares into a smaller number of Shares;

then the number of Warrant Shares purchasable upon exercise of the Warrants immediately after the occurrence of any such event shall be adjusted to equal the number of Warrant Shares which a record holder of the number of Warrant Shares purchasable upon exercise of the Warrants immediately prior to the happening of such event would own or be entitled to receive after the happening of such event.

          8.2 Issuance of Additional Shares . If at any time the Company shall (except as hereinafter provided) issue or sell any Additional Shares in exchange for consideration in an amount per Additional Share less than the Current Market Price at the time the Additional Shares are issued, then the number of Warrant Shares thereafter purchasable upon exercise of the Warrants shall be adjusted to that number determined by multiplying the number of Warrant Shares purchasable upon exercise of the Warrants immediately prior to such adjustment by a fraction (a) the numerator of which shall be the number of Shares outstanding immediately prior to the issuance of such Additional Shares plus the number of such Additional Shares so issued, and (b) the denominator of which shall be the number of Shares outstanding immediately prior to the issuance of such Additional Shares plus the number of Shares

which the aggregate consideration for the total number of such Additional Shares so issued would purchase at the Current Market Price. For purposes of this Section 8.2 , for all issuances of Shares except for those Shares issued in connection with an acquisition of assets or securities, a tender or exchange offer, a merger or other business combination, the date as of which the Current Market Price shall be computed shall be the earlier of (i) the date on which the Company shall enter into a firm contract for the issuance of such Additional Shares and (ii) the date of actual issuance of such Additional Shares. Subject to Section 8.5 hereof, no further adjustment of the number of Warrant Shares purchasable upon exercise of the Warrants shall be made under this Section 8.2 upon the issuance of any Additional Shares:

          (a) for which an adjustment is provided under Section 8.1 hereof;

          (b) which are issued pursuant to the exercise of any Options or the conversion, exchange or exercise of any Convertible Securities, if any such adjustment shall previously have been made upon the issuance of such Options or Convertible Securities (or upon the issuance of any Option therefor) pursuant to Section 8.3 or 8.4 hereof; or

          (c) as a distribution or a dividend which is distributed or declared and paid in accordance with Section 9.2 hereof.

          8.3 Issuance of Options . If at any time the Company shall issue or sell, or shall fix a record date for the determination of holders of any class of securities entitled to receive, any Options, whether or not the rights to purchase thereunder are immediately exercisable, and the consideration received by the Company in payment for such Options (determined in accordance with Section 8.6(a) hereof) shall be less than the Current Market Price in effect on the date of and immediately prior to such issuance, sale or fixing of a record date, then the number of Warrant Shares thereafter purchasable upon exercise of the Warrants shall be adjusted as provided in Section 8.2 hereof on the basis that (a) the maximum number of Additional Shares issuable pursuant to all such Options shall be deemed to have been issued as of (and, accordingly, the date as of which the Current Market Price shall be computed shall be) the computation date specified in the next succeeding sentence of this Section 8.3 , and (b) the aggregate consideration for such maximum number of Additional Shares shall be (subject to Section 8.5 hereof) the consideration received by the Company for the issuance or sale of such Additional Shares pursuant to the terms of such Options or pursuant to the terms of such Convertible Securities. For purposes of this Section 8.3 , the computation date for clause (a) above shall be the earlier of (i) the date on which the Company shall take a record of the holders of its Shares for the purpose of entitling them to receive any such Options, (ii) the date on which the Company shall enter into a firm contract for the issuance or sale of such Options and (iii) the date on which the Company shall issue or sell such Options. No further adjustment of the number of Warrant Shares purchasable upon exercise of the Warrants shall be made under this Section 8.3 upon the issuance or sale of any Options to subscribe for or purchase any Additional Shares or any Convertible Securities or upon the subsequent issue or sale of Additional Shares upon the exercise of such Options, if any such adjustment shall previously have been made upon the issuance or sale of such Option or upon the setting of a record date therefor, or upon any deemed issuance or sale of such Additional Shares, as a distribution or a dividend which is distributed or declared and paid in accordance with Section 9.2 hereof. Notwithstanding the foregoing, any issuance of an Option which is issued together with a debt security of the Company, as a unit, shall be treated for the purpose of this Section 8 as the issuance of a Convertible Security.

          8.4 Issuance of Convertible Securities . If at any time the Company shall issue or sell any Convertible Securities, whether or not the rights to exchange or convert thereunder are immediately exercisable, and the consideration received by the Company in payment for such Convertible Securities shall be less than the Convertible Security Value thereof, then the number of Warrant Shares thereafter purchasable upon exercise of the Warrants shall be increased to a number of Shares having a value

immediately following the computation date (as established below) equal to the value of the number of Warrant Shares purchasable upon exercise of the Warrants immediately before such increase. For this purpose, the value before the increase will be the Current Market Price of the Shares (determined as at the date immediately preceding such increase) divided by the number of Shares outstanding on a fully diluted basis, and the value immediately following the computation date shall be the foregoing value, except that the numerator shall be the Current Market Price plus the cash amount paid to the Company for such Convertible Securities less the Convertible Security Value of such Convertible Securities on issuance and the denominator shall be increased by the number of Additional Shares issuable on exercise of such Convertible Securities. For purposes of this Section 8.4 , the computation date shall be the earliest of (i) the date on which the Company shall take a record of the holders of its Shares for the purpose of entitling them to receive any such Convertible Securities, (ii) the date on which the Company shall enter into a firm contract for the issuance or sale of such Convertible Securities and (iii) the date of actual issuance or sale of such Convertible Securities. No further adjustment of the number of Warrant Shares purchasable upon exercise of the Warrants shall be made under this Section 8.4 upon the issuance or sale of any Convertible Securities or the conversion or exchange of such Convertible Securities into Additional Shares:

          (a) which are issued or sold pursuant to the exercise of any Option therefor, if any such adjustment shall previously have been made upon the issuance or sale of an Option relating to such Convertible Securities pursuant to Section 8.3 hereof; or

          (b) if any such adjustment in respect thereof shall previously have been made upon the setting of a record date therefor, or upon any deemed issuance or sale of such Convertible Securities; or

          (c) as a distribution or a dividend which is distributed or declared and paid in accordance with Section 9.2 hereof.

          8.5 Superseding Adjustment of Warrant Share . If, at any time after any adjustment of the number of Warrant Shares purchasable upon exercise of the Warrants shall have been made pursuant to Section 8.3 or 8.4 hereof as a result of the issuance of Options or Convertible Securities, or after any new adjustment of the number of Warrant Shares purchasable upon exercise of the Warrants shall have been made pursuant to this Section 8.5 , (a) such Options or the right of conversion, exchange or exercise of such Convertible Securities shall expire, and all or a portion of such Options or the right of conversion, exchange or exercise with respect to all or a portion of such Convertible Securities, as the case may be, shall not have been exercised or treated as having been exercised or otherwise canceled or acquired by the Company in connection with any settlement (including, without limitation, any cash settlement) of such Options or the rights of conversion, or exchange or exercise of such convertible Securities, or (b) there has been any change (whether by the passage of time or otherwise) in the number of Shares issuable upon exercise, conversion or exchange of such Options or Convertible Securities (including as a result of the operation of anti-dilution provisions applicable thereto), or (c) the consideration per Share, for which Additional Shares are issuable pursuant to such Options or the terms of any Convertible Securities, or the maturity of any such Convertible Security, shall be changed (whether by the passage of time or otherwise) then such previous adjustment shall be rescinded and annulled and the Additional Shares which were deemed to have been issued by virtue of the computation made in connection with the adjustment so rescinded and annulled shall no longer be deemed to have been issued by virtue of such computation. Thereupon, a recomputation shall be made of the effect of such Options or Convertible Securities on the basis of:

          (a) treating the number of Additional Shares, if any, theretofore actually issued or sold pursuant to the previous exercise of such Options or such right of conversion or exchange, as having

been issued or sold on the date or dates of such issuance as determined for purposes of such previous adjustment and for the consideration actually received therefor;

          (b) treating the maximum number of Additional Shares (A) issuable pursuant to all Options which then remain outstanding and (B) necessary to effect the conversion or exchange of all Convertible Securities which then remain outstanding, as having been issued (subject, however, to further adjustment under this Section 8.5 ); and

          (c) making the computations called for in Section 8.4 hereof on the basis of the revised terms of such Convertible Securities as if the securities being subject to recomputation were newly issued as of the relevant recomputation date and, if and to the extent called for by the foregoing provisions of this Section 8 on the basis aforesaid, a new adjustment of the number of Warrant Shares purchasable upon exercise of the Warrants shall be made, and such new adjustment shall supersede the previous adjustment so rescinded and annulled.

          8.6 Other Provisions Applicable to Adjustments Under this Section 8 . The following provisions shall be applicable to the making of adjustments of the number of Warrant Shares purchasable upon exercise of the Warrants hereinbefore provided for in this Section 8 , irrespective of the accounting treatment of any consideration described below:

          (a)  Computation of Consideration . To the extent that any Additional Shares, any Options or any Convertible Securities shall be issued for cash consideration, the consideration received by the Company therefor shall be deemed to be the amount of cash received by the Company therefor, or, if such Additional Shares, Options or Convertible Securities are offered by the Company for subscription, the subscription price, or, if such Additional Shares, Options or Convertible Securities are sold to underwriters or dealers for public offering without a subscription offering, the initial public offering price. To the extent that such issuance or sale shall be for consideration other than cash, then the amount of such consideration shall be deemed to be the fair market value of such consideration at the time of such issuance, as determined in good faith by the board of directors of the Company, whose determination shall be described in a duly adopted resolution certified by the Company’s Secretary or Assistant Secretary. The consideration for any Additional Shares issuable pursuant to any Option to subscribe for or purchase the same shall be the consideration received or receivable by the Company for the sale or issuance of such Option plus the additional consideration payable to the Company upon the exercise thereof in full. The consideration for any Additional Shares issuable pursuant to the terms of any Convertible Securities shall be the consideration paid or payable to the Company in respect of the subscription for, sale or issuance of such Convertible Securities plus the additional consideration payable to the Company upon the conversion or exchange thereof in full. In case of the issuance at any time of any Additional Shares in payment or satisfaction of any dividend upon any class of securities other than Shares, the Company shall be deemed to have received for such Additional Shares consideration equal to the amount of such dividend so paid or satisfied.

          (b)  When Adjustments to be Made . The adjustments required by this Section 8 shall be made whenever and as often as any specified event requiring an adjustment shall occur. For the purpose of any adjustment, any specified event shall be deemed to have occurred at the close of business on the date of its occurrence.

          (c)  Fractional Interests . In computing adjustments under this Section 8 , fractional interests in Shares shall be taken into account to the nearest one-hundredth of a Share.

          (d)  When Adjustment Not Required . If the Company shall take a record of the holders of its Shares for the purpose of entitling them to receive a dividend or distribution or subscription

or purchase rights and shall, thereafter and before the distribution thereof to the holders of the Shares of the Company, legally abandon its plan to pay or deliver such dividend, distribution, subscription or purchase rights, then no adjustment shall be required by reason of the taking of such record and any such adjustment previously made in respect thereof shall be rescinded and annulled, and no adjustment in the number of Warrant Shares thereafter purchasable upon exercise of the Warrants under Section 8.2 , 8.3 or 8.4 hereof shall be made in respect of the Warrants held by such Holder.

          8.7 Adjustments of Exercise Price . Whenever the number of Warrant Shares purchasable upon the exercise of the Warrant is adjusted, as herein provided, the Exercise Price per Warrant Share payable upon exercise of the Warrant shall be adjusted (calculated to the nearest $.0001) so that it shall equal the price determined by multiplying the Exercise Price immediately prior to such adjustment by a fraction, the numerator of which shall be the aggregate number of Warrant Shares purchasable upon the exercise of the Warrant immediately prior to such adjustment, and the denominator of which shall be the aggregate number of Warrant Shares so purchasable immediately thereafter.

     SECTION 9. Consolidation, Merger, Equity Exchange, Distributions . The provisions set forth in this Section 9 shall only apply to Warrants which have not yet been exercised.

          9.1 Consolidation, Merger, Equity Exchange, etc . In case a consolidation, merger or equity exchange of the Company shall be effected with another Person after the date hereof and the Company shall not be the surviving entity, or the Company shall be the surviving entity but its Shares shall be changed into securities or other property of another Person, or the sale, lease or transfer of all or substantially all of its assets to another Person shall be effected after the date hereof, then, as a condition of such consolidation, merger, equity exchange, sale, lease or transfer, lawful and adequate provision shall be made whereby each Holder shall thereafter have the right to purchase and receive, upon the exercise of its Warrants, on the basis and the terms and conditions specified herein (and in lieu of each Warrant Share immediately theretofore purchasable and receivable upon the exercise of the Warrants), such securities, cash or other property receivable upon such consolidation, merger, equity exchange, sale, lease or transfer as such Holder would have been entitled to receive if its Warrants had been exercised immediately prior to such event. In any such case, appropriate and equitable provision also shall be made with respect to the rights and interests of each Holder to the end that the provisions hereof (including Section 8 hereof) shall thereafter be applicable, as nearly as may be, in relation to any securities, cash or other property thereafter deliverable upon the exe