8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported):  August 3, 2007

Inovio Biomedical Corporation
(Exact name of registrant as specified in its charter)

Delaware	001-14888	33-0969592
(State or other jurisdiction	(Commission	(I.R.S. Employer
of incorporation)	File Number)	Identification No.)
11494 Sorrento Valley Road, San Diego, California		92121-1318
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code:  (858) 597-6006

Not Applicable
Former name or former address, if changed since last report

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 8.01.  Other Events.

Inovio Biomedical Corporation (the “registrant”) has filed, in accordance with the Securities Act of 1933, as amended (the “Securities Act”), and the rules and regulations thereunder, with the Securities and Exchange Commission a registration statement of Form S-3 (File No. 333-134084), including a base prospectus dated May 25, 2006, registering up to $75,000,000 of equity securities and the offering thereof from time to time in accordance with Rule 415 under the Securities Act, which incorporates by reference documents which registrant has filed or will file in accordance with the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder.

On August 6, 2007, registrant filed prospectus supplement no. 5 to the base prospectus relating to its offering (the “August 2007 Offering”) of up to 230,000 shares of registrant’s common stock, warrants to purchase up to 150,000 shares of registrant’s common stock at an exercise price of $3.00 per share, and up to 150,000 shares of registrant’s common stock issuable upon the exercise of such warrants to a professional advisor to companies in the health care industry in consideration and satisfaction of registrant’s obligation to pay the advisor a non-refundable retainer in relation to an advisory agreement between the parties executed August 3, 2007.

Item 9.01.  Financial Statements and Exhibits

(d)Exhibits

The registrant is filing the following exhibits as part of this Current Report on Form 8-K in connection with the August 2007 Offering described in Item 8.01 above.

4.1	Letter Agreement dated August 3, 2007 between Registrant and Asia Life Sciences Venture Consulting Inc.
4.2	Form of Warrant to Purchase Common Stock.
5.1	Opinion of Kirkpatrick & Lockhart Preston Gates Ellis LLP.
23.1	Consent of Kirkpatrick & Lockhart Preston Gates Ellis LLP (included in Exhibit 5.1).

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: August 6, 2007

INOVIO BIOMEDICAL CORPORATION
By:	/s/ Peter Kies
	Peter Kies, Chief Financial Officer

EX-4.1

Exhibit 4.1

August 3rd, 2007

	[ALVC Logo]
To:	Dr. Avtar Dhillon
	President & CEO
	Inovio Biomedical Corporation
	11494 Sorrento Valley Road
	San Diego, CA 92121-1318
	USA
	Tel: 858-410-3117
	Fax: 858-597-0451

Dear Avtar:

This letter agreement (the “Agreement”) will confirm the understanding and agreement between Asia Life Sciences Venture Consulting Inc. (“ALVC”) and Inovio Biomedical Corporation (the “Company” or “Inovio”) as follows:

The Company hereby engages ALVC on a non-exclusive basis for the purpose of (a) providing services on matters concerning investor and public relations, including but not limited to making introductions to brokers, analysts, institutional money managers, and other potential investors based in the territory (“Territory,” as defined below); (b) identifying opportunities for the license/sale (“License,” as defined below) of all or part of one of the Company’s therapy programs (“Program,” as more fully described on Exhibit B hereto); (c) advising the Company concerning opportunities for such License; and (d) as involved in and as requested by the Company, participating on the Company’s behalf in negotiations concerning such License.

1.ALVC hereby accepts the engagement described in paragraph 1 and, in that connection, agrees to do the following, as requested by the Company:

(a)prepare at Inovio’s request a descriptive memorandum concerning the Program, which memorandum shall not be made available to or used in discussions with prospective Licensees until both it and its use for that purpose have been approved by the Company;

(b)develop and review with the Company, a list of parties, approved in advance by the Company, who might be interested in Licensing the Program (the “List”) and contact parties on the List only as approved by the Company; and

(c)consult with and advise the Company concerning opportunities for the License of the Program which have been identified by ALVC and, if so requested by the Company, participate on the Company’s behalf in negotiations for such License.

2.For purposes of this Agreement:

(a)A “License” of the Program shall mean any transaction or series or combination of transactions (regardless of the form or structure thereof) within the Territory whereby, directly or indirectly, control of or a material interest in the Program is transferred for consideration.

(b)The “Territory” is defined herein as North and South America, Europe, Asia, the countries of the former Soviet Union, the Middle East, and Africa. ALVC hereby acknowledges that the Territory may overlap with the geographical territory covered by the Company’s other consulting arrangements and that the Company may already be in contact with certain prospective Licensees in one or more segments of the Territory through other channels.

3.

(a)The Company and ALVC shall mutually agree on the names of parties whom ALVC plans to contact concerning a License, which parties shall be set forth as the “List” as memorialized on Exhibit A hereto.

Beginning from the date of execution of this Agreement (the “Execution Date”), ALVC will on a regular basis, but no less frequently than once every 30 calendar days, provide written statements (“Periodic Reports”) to the Company with respect to parties it has contacted and parties that have contacted it in connection with the possible License of the Program.  The inclusion on the List of any parties that have independently contacted ALVC in connection with a possible License shall be at the Company’s discretion; the Company shall always have the right to exclude a prospective Licensee from the List, whether because it deems such prospective Licensee unsuitable or because it is already in contact with such prospective Licensee through other channels.  Each Periodic Report will be deemed complete and accurate as submitted, if within five business days after submission (i) ALVC has not submitted to the Company any corrections or addenda thereto and (ii) the Company has not submitted any questions or requests for corrections or addenda thereto to ALVC.

The parties will amend the List from time to time to add the names of parties as to which the Company, in its sole discretion, has given ALVC explicit, written, prior authorization to approach on the

Company’s behalf.  (Such parties shall either have been named by ALVC on a Periodic Report to the Company or shall have been identified by the Company to ALVC.)  ALVC shall not approach any potential licensee on the Company’s behalf until it receives explicit, written, prior authorization to do so from the Company.

(b)The Company covenants to make available to ALVC all information concerning the Program which ALVC reasonably requests in connection with the performance of its obligations hereunder, to the extent the Company has the legal right to disclose such information.  All such information provided by or on behalf of the Company shall be reasonably complete and accurate and not misleading, and ALVC shall be entitled to reasonably rely upon the accuracy and completeness of all such information without independent verification.  The Company shall continue to advise ALVC regarding any material developments or matters relating to the Program which occur during the term of ALVC’s engagement hereunder, to the extent the Company has the legal right to do so.  ALVC shall not be at liberty to disclose any information regarding the Program, other than the information provided by the Company pre-approved for such disclosure, to any third party, including any prospective Licensee, until such third party has entered into a Confidential Disclosure Agreement with the Company, in substantially the form attached hereto as Exhibit C.  ALVC further covenants to return any and all materials and information regarding the Program promptly upon any termination of this Agreement, including seeking return of any materials

4.The Company may refuse to discuss or negotiate a License with any party for any reason whatsoever and may terminate negotiations with any prospective Licensee at any time.

5.As compensation for the services rendered by ALVC hereunder, the Company shall pay ALVC as follows:

(a)Non-Refundable Retainer Fee - Non-refundable fee payable by the issuance and delivery in two tranches of up to 230,000 shares of common stock of the Company (the “Company Shares”) and warrants to purchase up to 150,000 shares of the common stock of the Company exercisable for five years from the date of issuance (the “Company Warrants”), as follows:

i.The market value for the Company Shares shall be (i) the closing price per share of the Company’s common stock as reported on AMEX on the day prior to the Execution Date, or (ii) the closing price per share of the Company’s common

stock as reported on the AMEX on the Execution Date, if such execution occurs after 4:00 p.m. Eastern Time.  The exercise price of the Company Warrants shall be USD$3.00 per share.

ii.On the third business day after the Effective Date, as defined in Section 5(a)(v) below, (the “First Delivery Date”), the Company shall deliver to ALVC 115,000 Company Shares and 75,000 Company Warrants.

iii.ALVC’s first Periodic Report shall be delivered to the Company no sooner than the first business day after the Effective Date and no later than the thirtieth (30th) day after the Execution Date; within five (5) business days from the date of the Company’s receipt of such Periodic Report, the Company shall deliver to ALVC another 115,000 Company Shares and 75,000 Company Warrants (the “Second Delivery Date”).

iv.In the event ALVC fails to submit the first Periodic Report within the thirty-day period from the Execution Date, the Company shall have no obligation to deliver the balance of the Company Shares and Company Warrants until such time as a satisfactory Periodic Report is received by the Company. In the event the Company chooses to terminate the Agreement prior to the delivery of the first Periodic Report, the Company shall have no obligation to deliver the balance of the Company Shares and Company Warrants.  Under no circumstances will the Company have any obligation to pay the balance of the non-refundable retainer in cash or using consideration other than the Company Shares and Company Warrants.

v.Within two days of the Execution Date, the Company shall file with the Securities and Exchange Commission (the “SEC”) a prospectus supplement relating to the issuance and sale of the Company Shares and Company Warrants to be issued by it pursuant hereto, including the shares of common stock underlying the Company Warrants, and the Company shall deliver the same to ALVC along with its base prospectus dated May 25, 2006 that the Company heretofore filed with the SEC, and ALVCshall acknowledge receipt thereof in writing.  Within two days of the Execution Date, the Company shall provide official notice of this Agreement to the American Stock Exchange (“AMEX”) and request approval for the additional listing of the shares of common stock issuable pursuant hereto; no Company Shares or Company Warrants shall be issued and delivered until the Company receives official notice of such approval from AMEX (the “Effective Date”).

vi.ALVC hereby represents and warrants to the Company that (i) it is acquiring the Company Shares and Company Warrants for its own account for investment and not with a present view towards the distribution thereof; provided, however, that by making the foregoing representation, ALVCdoes not agree to hold the Company Shares and Company Warrants for any minimum or other specific term and reserves the right to dispose of the Company Shares and Company Warrants at any time; (ii) ALVC does not have any contract, understanding, or arrangement with any person to sell, transfer, or grant participation to such person or any third person with respect to the Company Shares and Company Warrants; and (iii) from the date 30 days prior to the Execution Date through 48 hours after the earlier of the Second Delivery Date or termination of this Agreement, there will be no short selling of Inovio stock by ALVC or by any of its principals, managers, members, or affiliates.  For purposes of this Section 5(a)(vi), a “Short Sale” by a ALVC or one of the individuals listed above means a sale of the Company’s common stock that is marked as a short sale and that is executed at a time when the selling party has no equivalent offsetting long position in the Company’s common stock.  For purposes of determining whether ALVC or an individual has an equivalent offsetting long position in the common stock, all common stock and all common stock that would be issuable upon conversion or exercise in full of all common stock equivalents then held by such selling party (assuming that such common stock equivalents were then fully convertible or exercisable, notwithstanding any provisions to the contrary, and giving effect to any conversion or exercise price adjustments scheduled to take effect in the future) shall be deemed to be held long by such selling party.

(b)The Company shall have no obligation to make any other payments to ALVC hereunder with respect to any consideration received under any License, sale of product, or acquisition considered or entered into with any party, whether or not on the List, regardless of whether such License or other sales or acquisition arrangement is executed during the term of ALVC’s engagement hereunder or at any time following the effective termination of ALVCs engagement hereunder.

6.The Company shall reimburse ALVC upon request for its reasonable professional and legal fees incurred in connection with its engagement hereunder. Members of ALVC willtravel economy class.  To be eligible for such reimbursement, any expense in excess of $100 shall require prior written authorization of the Company.

7.In acknowledgment of the proprietary information likely to be obtained by ALVC with regard to the Company and its opportunities, ALVC represents that it currently does not represent and covenants that during the term of this Agreement itwill not represent any other entity engaged in the field of electroporation.

8.The Company shall:

(a)Indemnify ALVC and hold it harmless against any and all losses, claims, damages or liabilities actually incurred by ALVC as a result of third-party claims against ALVC in connection with the rendering of services by ALVC hereunder or the rendering of additional services by ALVC as requested in writing by the Company that are related to the services rendered hereunder, expressly excluding, however, any losses, claims, damages, or liabilities incurred in connection with a dispute between the parties in connection with any alleged breach by a party of its obligations hereunder, and any losses, claims, damages or liabilities resulting from the negligence or willful misconduct of ALVC; and

(b)Reimburse ALVC for any reasonable legal or other expenses actually incurred by it in connection with investigating, preparing to defend or defending, or providing evidence in or preparing to serve or serving as a witness with respect to, any third-party lawsuits, investigations, claims or other proceedings in connection with the rendering of services by ALVC hereunder or the rendering of additional services by ALVC, as requested by the Company in writing, that are related to the services rendered hereunder, expressly excluding, however, any expenses incurred in connection with a dispute between the parties in connection with any alleged breach by a party of its obligations hereunder), or resulting from the negligence or willful misconduct of ALVC.

The Company agrees that the indemnification and reimbursement commitments set forth in this paragraph 9 shall apply whether or not ALVC is a formal party to any such lawsuits, investigations, claims or other proceedings and that such commitments shall extend upon the terms set forth in this paragraph to any controlling person, affiliate, director, officer, or employee of ALVC (each, with ALVC, an “Indemnified Person”).  The Company further agrees that, without ALVC’s prior written consent, it will not enter into any settlement of a lawsuit, claim or other proceeding arising out of the transactions

contemplated by this Agreement and materially involving ALVC’s interests, which consent will not unreasonably be withheld.

In connection with the foregoing, the Company at its own expense shall provide legal counsel for itself and the Indemnified Persons, which in the absence of irreconcilable conflict may be one and the same.

9.Except as contemplated by the terms hereof or as required by applicable law or pursuant to an order entered or subpoena issued by a court of competent jurisdiction, ALVC shall keep confidential all material non-public information provided to it by the Company, and shall not disclose such information to any third party, other than such of its employees and advisors as ALVC determines to have a need to know, and provided that such employees and advisors are informed of and agreed to be bound by this section and the other provisions relating to the access of ALVC to the Company’s proprietary information found in paragraphs 4(b) and 8.

10.The term of ALVC’s engagement hereunder shall be twenty-four (24) months from the Execution Date, unless terminated sooner as set forth below.  Subject to the provisions of paragraphs 4, 5(b), 8, 9, 12 and 13, which shall survive any termination or expiration of this Agreement, either party may terminate ALVC’s engagement hereunder at any time by giving the other party at least thirty (30) days prior written notice. Immediately upon receipt of such notice, ALVC shall cease all activity on the Company’s behalf, and ALVC shall neither solicit nor accept any solicitations of interest in the Program from third parties.  Following termination, the Company shall owe ALVC no further fees, except as set forth in paragraph 5 and 6.

11.Nothing in this Agreement, expressed or implied, is intended to confer or does confer on any person or entity other than the parties hereto or their respective successors and assigns, and to the extent expressly set forth herein, the Indemnified Persons, any rights or remedies under or by reason of this Agreement or as a result of the services to be rendered by ALVC hereunder.  The parties acknowledge that ALVC is not acting as an agent of the Company or in a fiduciary capacity with respect to the Company and that ALVC is not assuming any duties or obligations other than those expressly set forth in this Agreement.

12.The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provisions of this Agreement, which shall remain in full force and effect.

13.This Agreement may not be amended or modified except in writing signed by each of the parties and shall be governed by and construed and enforced in accordance with the laws of the State of California. Any right to trial by jury with respect to any lawsuit, claim or other proceeding arising out of or relating to this Agreement or the services to be rendered by ALVC hereunder is expressly and irrevocably waived to the extent possible under applicable law.

14.The parties acknowledge that ALVC’s duty to perform services hereunder is not transferable or assumable by any third party, including any individual affiliated with or any successor entity to ALVC, without the prior written consent of the Company; if ALVC shall become unable to perform the services contemplated by this agreement due to insolvency, bankruptcy, dissolution, or liquidation, the Company may immediately terminate this agreement at its discretion, regardless of the notice requirement in Section 10 and with no further payment or other obligations to ALVC.

If the foregoing correctly sets forth the understanding and agreement between ALVC and the Company, please so indicate in the space provided for that purpose below, whereupon this letter shall constitute a binding agreement as of the date hereof.

Asia Life Sciences Venture Consulting Inc.
By:	/s/ Vincent Lum	Date:	Aug 3/07
	Vincent Lum, Managing Partner

AGREED:
Inovio Biomedical Corporation
By:   /s/ Avtar Dhillon	Date:	8/3/07
Name: Avtar Dhillon, MD
Title: President and CEO

[EXHIBITS, WHICH ARE NOT RELEVANT TO THE ISSUANCE AND SALE OF INOVIO SHARES, WARRANTS OR WARRANT SHARES, THE CONSIDERATION THEREFOR OR THE TERMS THEREOF HAVE BEEN OMITTED]

EX-4.2

Exhibit 4.2

THIS WARRANT MAY NOT BE TRANSFERRED, ASSIGNED OR OTHERWISE DISPOSED OF UNLESS SUCH TRANSFER (I) COMPLIES WITH STATE AND FEDERAL SECURITIES LAWS, (II) IS TO A NON-”U.S. PERSON” AS DEFINED IN REGULATION S AS PROMULGATED UNDER THE SECURITIES ACT, AND (III) IS ONLY TO A PERSON THAT AT THE TIME OF TRANSFER QUALIFIES AS (X) AN “ACCREDITED INVESTOR” WITHIN THE MEANING OF RULE 501(A) OF REGULATION D UNDER THE SECURITIES ACT, (Y) A “QUALIFIED INSTITUTIONAL BUYER” WITHIN THE MEANING OF RULE 144A(A)(1) OF THE SECURITIES ACT OR (Z) TO AN AFFILIATE OF SUCH PURCHASER AS THE TERM “AFFILIATE” IS DEFINED AND APPLIED UNDER RULE 501(B) OF REGULATION D UNDER THE SECURITIES ACT.

Warrant No.        

COMMON STOCK PURCHASE WARRANT

To Purchase [             ] Shares of Common Stock of
INOVIO BIOMEDICAL CORPORATION

THIS IS TO CERTIFY THAT Asia Life Sciences Venture Consulting, Inc., or registered assigns (the “Holder”), is entitled, during the Exercise Period (as hereinafter defined), to purchase from Inovio Biomedical Corporation, a Delaware corporation (the “Company”), the Warrant Stock (as hereinafter defined and subject to adjustment as provided herein), in whole or in part, at a purchase price of $3.00 per share, all on and subject to the terms and conditions hereinafter set forth.

1.Definitions.  As used in this Warrant, the following terms have the respective meanings set forth below:

“Appraised Value” means, in respect of any share of Common Stock on any date herein specified, the fair saleable value of such share of Common Stock (determined without giving effect to the discount for (i) a minority interest or (ii) any lack of liquidity of the Common Stock or to the fact that the Company may have no class of equity registered under the Exchange Act) as of the last day of the most recent fiscal month ending prior to such date specified, based on the value of the Company on a fully-diluted basis, as determined by a nationally recognized investment banking firm selected by the Company’s Board of Directors and having no prior relationship with the Company.

“Business Day” means any day except Saturday, Sunday and any day that shall be a legal holiday or a day on which banking institutions in the State of California generally are authorized or required by law or other government actions to close.

“Change of Control” means the (i) acquisition by an individual or legal entity or group (as set forth in Section 13(d) of the Exchange Act) of more than one-half of the voting rights or equity interests in the Company; or (ii) sale, conveyance, or other disposition of all or substantially all of the assets, property or business of the Company or (iii) the merger into or

consolidation with any other corporation (other than a wholly owned subsidiary corporation where the Company is the surviving entity) or (iv) effectuation of any transaction or series of related transactions where holders of the Company’s voting securities prior to such transaction or series of transactions fail to continue to hold at least 50% of the voting power of the Company.

“Closing Date” means the date on which this Warrant is duly executed by the Company and delivered to the Holder hereof.

“Commission” means the Securities and Exchange Commission or any other federal agency then administering the Securities Act and other federal securities laws.

“Common Stock” means (except where the context otherwise indicates) the Common Stock, $0.001 par value per share, of the Company as constituted on the Closing Date, and any capital stock into which such Common Stock may thereafter be changed or converted, and shall also include shares of common stock of any successor or acquiring corporation (and/or Other Property) received by or distributed to the holders of Common Stock of the Company in the circumstances contemplated by Section 4.4.

“Current Market Price” means, in respect of any share of Common Stock on any date herein specified,

(1)if there shall not then be a public market for the Common Stock, the higher of

(a) the book value per share of Common Stock at such date, and

(b) the Appraised Value per share of Common Stock at such date,

or

(2)if there shall then be a public market for the Common Stock, the higher of (x) the book value per share of Common Stock at such date, and (y) the average of the daily market prices for the 20 consecutive Trading Days immediately before such date. The daily market price (the “Daily Market Price”) for each such Trading Day shall be (i) the closing price on such day on the principal stock exchange (including Nasdaq) on which such Common Stock is then listed or admitted to trading, or quoted, as applicable, (ii) if no sale takes place on such day on any such exchange, the last reported closing price on such day as officially quoted on any such exchange (including Nasdaq), (iii) if the Common Stock is not then listed or admitted to trading on any stock exchange, the last reported closing bid price on such day in the over-the-counter market, as furnished by the National Association of Securities Dealers Automatic Quotation System or the National Quotation Bureau, Inc., (iv) if neither such corporation at the time is engaged in the business of reporting such prices, as furnished by any similar firm then engaged in such business, or (v) if there is no such firm, as furnished by any member of the NASD selected mutually by the Holder and the Company or, if they cannot agree upon such selection, as selected by two such members of the NASD, one of which shall be selected by the Holder and one of which shall be selected by the Company.

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“Current Warrant Price” means, in respect of a share of Common Stock at any date herein specified, the price at which a share of Common Stock may be purchased pursuant to this Warrant on such date. Until the Current Warrant Price is adjusted pursuant to the terms herein, the initial Current Warrant Price shall be $3.00 per share of Common Stock.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, or any similar federal statute, and the rules and regulations of the Commission thereunder, all as the same shall be in effect from time to time.

“Exercise Period” means the period during which this Warrant is exercisable pursuant to Section 2.1.

“Expiration Date” means 2012(1).

“Letter Agreement” means that certain Letter Agreement dated as of July 13, 2007 among the Company and Asia Life Sciences Venture Consulting, Inc., pursuant to which this Warrant was originally issued.

“NASD” means the National Association of Securities Dealers, Inc., or any successor corporation thereto.

“Other Property” has the meaning set forth in Section 4.4.

“Person” means any individual, sole proprietorship, partnership, joint venture, trust, incorporated organization, association, corporation, limited liability company, institution, public benefit corporation, entity or government (whether federal, state, county, city, municipal or otherwise, including, without limitation, any instrumentality, division, agency, body or department thereof).

“Prospectus Supplement” means the prospectus supplement to be filed with the Commission pursuant to Rule 424 under the Securities Act relating to the offer and sale of the Company’s securities, including the Warrant and Warrant Stock, as listed in the form of prospectus included in the Registration Statement.

“Registration Statement” means the registration statement filed with the Commission on Form S-3 (File No. 333-134084) under the Securities Act and the rules and regulations of the Commission thereunder, declared effective as of May 25, 2006, and such amendments to such registration statement as have been filed as of the date of this Agreement, the exhibits and any schedules thereto, the documents incorporated by reference therein and the documents and information otherwise deemed to be a part thereof or included therein, including the Prospectus Supplement and any post-effective amendment(s).

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

(1) [Insert date five years after date of issuance of this Warrant].

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“Trading Day” means any day on which the primary market on which shares of Common Stock are listed is open for trading.

“Transfer” means any disposition of any Warrant or Warrant Stock or of any interest in either thereof, which would constitute a sale thereof within the meaning of the Securities Act.

“Warrants” means this Warrant and all warrants issued upon transfer, division or combination of, or in substitution for, any thereof. All Warrants shall at all times be identical as to terms and conditions and date, except as to the number of shares of Common Stock for which they may be exercised.

“Warrant Price” means an amount equal to (i) the number of shares of Common Stock being purchased upon exercise of this Warrant pursuant to Section 2.1, multiplied by (ii) the Current Warrant Price.

“Warrant Stock” means the [               ] shares of Common Stock to be purchased upon the exercise hereof, subject to adjustment as provided herein.

2.Exercise of Warrant.

2.1.Manner of Exercise. From and after the Closing Date, and until 5:00 P.M., California time, on the Expiration Date (the “Exercise Period”), the Holder may exercise this Warrant, on any Business Day, for all or any part of the number of shares of Warrant Stock purchasable hereunder.

In order to exercise this Warrant, in whole or in part, the Holder shall deliver to the Company at its principal office or at the office or agency designated by the Company pursuant to Section 12, (i) a written notice of Holder’s election to exercise this Warrant, which notice shall specify the number of shares of Warrant Stock to be purchased, (ii) payment of the Warrant Price as provided herein and (iii) this Warrant. Such notice shall be substantially in the form of the subscription form appearing at the end of this Warrant as Exhibit A duly executed by the Holder or its agent or attorney in fact. Upon receipt thereof, the Company shall, as promptly as practicable, and in any event within three Business Days thereafter, execute or cause to be executed and deliver or cause to be delivered to the Holder a certificate or certificates representing the aggregate number of full shares of Warrant Stock issuable upon such exercise, together with cash in lieu of any fraction of a share, as hereinafter provided. The stock certificate or certificates so delivered shall be, to the extent possible, in such denomination or denominations as the Holder shall request in the notice and shall be registered in the name of the Holder or such other name as shall be designated in the notice. This Warrant shall be deemed to have been exercised and such certificate or certificates shall be deemed to have been issued, and the Holder or any other Person so designated to be named therein shall be deemed to have become a Holder of record of such shares for all purposes, as of the date when the notice, together with the payment of the Warrant Price and this Warrant, is received by the Company as described above. If this Warrant shall have been exercised in part, the Company shall, at the time of delivery of the certificate or certificates representing Warrant Stock, deliver to the Holder a new Warrant evidencing the rights of the Holder to purchase the unpurchased shares of Common Stock called for by this Warrant, which new Warrant shall in all other respects be identical with this Warrant, or at the request of the Holder, appropriate notation may be made on this Warrant and the same returned to the Holder.

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Payment of the Warrant Price may be made at the option of the Holder by: (i) certified or official bank check payable to the order of the Company or (ii) wire transfer to the account of the Company.  All shares of Common Stock issuable upon the exercise of this Warrant pursuant to the terms hereof shall be validly issued and, upon payment of the Warrant Price, shall be fully paid and nonassessable.

2.2Mandatory Exercise.  The Company may request that the Holder exercise this Warrant (the “Mandatory Exercise”) within thirty (30) Business Days after the date of the Mandatory Exercise Notice (as defined below) by delivering a written notice to the Holder at such address as the Holder shall have provided to the Company in writing pursuant to Section 14.2 hereof (the “Mandatory Exercise Notice”); provided that (i) the Daily Market Price for twenty (20) of the thirty (30) Trading Days ending on the date of the Mandatory Exercise Notice (as defined below), is equal to or greater than 250% of the Current Warrant Price, (ii) sufficient shares of Common Stock of the Company are authorized and reserved for issuance upon the full exercise of this Warrant, (iii) the Registration Statement shall be effective, current and available for use by the Holder in connection with sales of the Warrant Stock at all times from the date of the Mandatory Exercise Notice through the Mandatory Exercise Termination Date, and (iv) the Company is not in default of any material provision of any Transaction Document (as defined in the Securities Purchase Agreement).  The Mandatory Exercise Notice shall set forth the Current Warrant Price and the Daily Market Price for each of the previous twenty (20) Trading Days immediately preceding the date of the Mandatory Exercise Notice and shall state that this Warrant may be exercised in conformity with this Section 2.2 within thirty (30) Business Days.  The last day of such thirty-Business Day period is hereinafter referred to as the “Mandatory Exercise Termination Date”.  To the extent the Holder fails to exercise this Warrant by 5:00 pm California time of the Mandatory Exercise Termination Date, then (i) this Warrant shall be deemed terminated for all purposes and (ii) the Holder shall deliver to the Company this Warrant marked “cancelled” (but the failure of the Holder to deliver this Warrant to the Company for cancellation shall not affect the termination of this Warrant as of the Mandatory Exercise Termination Date).

2.3.Fractional Shares. The Company shall not be required to issue a fractional share of Common Stock upon exercise of any Warrant. As to any fraction of a share which the Holder of one or more Warrants, the rights under which are exercised in the same transaction, would otherwise be entitled to purchase upon such exercise, the Company shall pay an amount in cash equal to the Current Market Price per share of Common Stock on the date of exercise multiplied by such fraction.

3.Transfer, Division and Combination.

3.1.Transfer. The Warrants and the Warrant Stock shall be transferable, subject to compliance with all applicable laws, including, but not limited to the federal and state securities laws and the following limitations.  This Warrant may not be transferred, assigned or otherwise disposed of unless such transfer (i) is to a non-”U.S. person” as defined in Regulation S as promulgated under the Securities Act, and (ii) is only to a person that at the time of transfer

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qualifies as (x) an “accredited investor” within the meaning of Rule 501(a) of Regulation D under the Securities Act, (y) a “qualified institutional buyer” within the meaning of Rule 144A(a)(1) of the Securities Act or (z) to an affiliate of such the Holder as the term “affiliate” is defined and applied under Rule 501(b) of Regulation D under the Securities Act.   Any transferee of this Warrant must also agree in writing to be subject to the same obligations and make the same representations as the Holder did pursuant to the Letter Agreement at the time of the Holder’s initial acquisition of the Warrant.  Transfer of this Warrant and all rights hereunder, in whole or in part, in accordance with the foregoing provisions, shall be registered on the books of the Company to be maintained for such purpose, upon surrender of this Warrant at the principal office of the Company referred to in Section 2.1 or the office or agency designated by the Company pursuant to Section 12, together with a written assignment of this Warrant substantially in the form of Exhibit B hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or assignees and in the denomination specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled. Following a transfer that complies with the requirements of this Section 3.1, the Warrant may be exercised by a new Holder for the purchase of shares of Common Stock regardless of whether the Company issued or registered a new Warrant on the books of the Company.

In connection with any transfer of the Warrant Stock other than pursuant to the Registration Statement, Rule 144 or to the Company, the Company may require the transferor thereof to provide to the Company an opinion of counsel selected by the transferor and reasonably acceptable to the Company, the form and substance of which opinion and shall be reasonably satisfactory to the Company, to the effect that such transfer does not require further registration of such transferred Warrant Stock under the Securities Act.  As a condition of transfer, any such transferee shall agree in writing to be subject to the same obligations and makes the same representations as the Holder did pursuant to the Letter Agreement at the time of the Holder’s initial acquisition of the right to the Warrant Stock.

3.2.Restrictive Legends. To the extent the Warrant is exercised at such time as the Registration Statement is not effective, current and available for use by the Holder in connection with the sale of all shares of the Common Stock issuable pursuant to this Warrant, each certificate for Warrant Stock initially issued upon the exercise of this Warrant, and each certificate for Warrant Stock issued to any subsequent transferee of any such certificate, unless, in each case, such Warrant Stock is eligible for resale without registration pursuant to Rule 144(k) under the Exchange Act, shall be stamped or otherwise imprinted with a legend in substantially the following form:

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AS AMENDED, AND MAY NOT BE OFFERED, SOLD, ASSIGNED OR TRANSFERRED, IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER SAID ACT OR UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT REGISTRATION UNDER SAID ACT IS NOT REQUIRED.”

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3.3.Division and Combination; Expenses; Books. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office or agency of the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or its agent or attorney. Subject to compliance with Section 3.1 as to any transfer which may be involved in such division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such notice. The Company shall prepare, issue and deliver at its own expense the new Warrant or Warrants under this Section 3. The Company agrees to maintain, at its aforesaid office or agency, books for the registration and the registration of transfer of the Warrants.

4.Adjustments. The number of shares of Common Stock for which this Warrant is exercisable, and the price at which such shares may be purchased upon exercise of this Warrant, shall be subject to adjustment from time to time as set forth in this Section 4. The Company shall give the Holder notice of any event described below which requires an adjustment pursuant to this Section 4 in accordance with Sections 5.1 and 5.2.

4.1.Stock Dividends, Subdivisions and Combinations; Reclassifications.

(a)If at any time while this Warrant is outstanding the Company shall:

(i)declare a dividend or make a distribution on its outstanding shares of Common Stock in shares of Common Stock,

(ii)subdivide its outstanding shares of Common Stock into a larger number of shares of Common Stock, or

(iii)combine its outstanding shares of Common Stock into a smaller number of shares of Common Stock, then:

(1)the number of shares of Common Stock acquirable upon exercise of this Warrant immediately after the occurrence of any such event shall be adjusted to equal the number of shares of Common Stock which a record holder of the same number of shares of Common Stock that would have been acquirable under this Warrant immediately prior to the record date for such dividend or distribution or the effective date of such subdivision or combination would own or be entitled to receive after such record date or the effective date of such subdivision or combination, as applicable, and

(2)the Current Warrant Price shall be adjusted to equal:

(A)the Current Warrant Price in effect at the time of the record date for such dividend or distribution or of the effective date of such subdivision or combination, multiplied by the number of shares of Common Stock into which this Warrant is exercisable immediately prior to the adjustment, divided by

(B)the number of shares of Common Stock into which this Warrant is exercisable immediately after such adjustment.

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Any adjustment made pursuant to clause (i) of this paragraph shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution, and any adjustment pursuant to clauses (ii) or (iii) of this paragraph shall become effective immediately after the effective date of such subdivision or combination.

(b)If the Company, by reclassification of securities or otherwise, shall change any of the securities as to which purchase rights under this Warrant exist into the same or a different number of securities of any other class or classes or other assets or property, this Warrant shall thereafter represent the right to acquire such number and kind of securities or other assets or property as would have been issuable as the result of such change with respect to the securities that were subject to the purchase rights under this Warrant immediately prior to such reclassification or other change and the Current Warrant Price therefore shall be appropriately adjusted, all subject to further adjustment as provided in this Section 4.  In any such reclassification, appropriate provision shall be made with respect to the rights and interests of the Holder to the end that the provisions hereof (including, without limitation, provisions for the number of securities purchasable or receivable upon the exercise of this Warrant) shall thereafter be applicable, as nearly as may be, in relation to any securities or other assets or property thereafter deliverable upon the exercise of this Warrant.

4.2.Certain Other Distributions. If at any time while this Warrant is outstanding the Company shall cause the holders of its Common Stock to be entitled to receive any dividend or other distribution of:

(i)cash,

(ii)any evidences of its indebtedness, any shares of stock of any class or any other securities or property or assets of any nature whatsoever (other than cash or additional shares of Common Stock as provided in Section 4.1 hereof), or

(iii)any warrants or other rights to subscribe for or purchase any evidences of its indebtedness, any shares of stock of any class or any other securities or property or assets of any nature whatsoever, then:

(1)the number of shares of Common Stock acquirable upon exercise of this Warrant shall be adjusted to equal the product of the number of shares of Common Stock acquirable upon exercise of this Warrant immediately prior to the record date for such dividend or distribution, multiplied by a fraction (x) the numerator of which shall be the Current Warrant Price per share of Common Stock at the date of taking such record and (y) the denominator of which shall be such Current Warrant Price minus the amount allocable to one share of Common Stock of any such cash so distributable and of the fair value (as determined in good faith by the Board of Directors of the Company) of any and all such evidences of indebtedness, shares of stock, other securities or property or warrants or other subscription or purchase rights so distributable; and

(2)the Current Warrant Price in effect immediately prior to the record date fixed for determination of stockholders entitled to receive such distribution shall be

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adjusted to equal (x) the Current Warrant Price multiplied by the number of shares of Common Stock acquirable upon exercise of this Warrant immediately prior to the adjustment, divided by (y) the number of shares of Common Stock acquirable upon exercise of this Warrant immediately after such adjustment. A reclassification of the Common Stock (other than a change in par value, or from par value to no par value or from no par value to par value) into shares of Common Stock and shares of any other class of stock shall be deemed a distribution by the Company to the holders of its Common Stock of such shares of such other class of stock within the meaning of this Section 4.2 and, if the outstanding shares of Common Stock shall be changed into a larger or smaller number of shares of Common Stock as a part of such reclassification, such change shall be deemed a subdivision or combination, as the case may be, of the outstanding shares of Common Stock within the meaning of Section 4.1.

4.3.Other Provisions Applicable to Adjustments. The following provisions shall be applicable to the making of adjustments of the number of shares of Common Stock into which this Warrant is exercisable and the Current Warrant Price provided for in Section 4:

(a)  When Adjustments to Be Made. The adjustments required by Section 4 shall be made whenever and as often as any specified event requiring an adjustment shall occur, except that any that would otherwise be required may be postponed (except in the case of a subdivision or combination of shares of the Common Stock, as provided for in Section 4.1) up to, but not beyond the date of exercise if such adjustment either by itself or with other adjustments not previously made adds or subtracts less than 1% of the shares of Common Stock into which this Warrant is exercisable immediately prior to the making of such adjustment. Any adjustment representing a change of less than such minimum amount (except as aforesaid) which is postponed shall be carried forward and made as soon as such adjustment, together with other adjustments required by this Section 4 and not previously made, would result in a minimum adjustment or on the date of exercise. 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.

(b)  Fractional Interests. In computing adjustments under this Section 4, fractional interests in Common Stock shall be taken into account to the nearest 1/100th of a share.

(c)  When Adjustment Not Required. If the Company undertakes a transaction contemplated under this Section 4 and as a result takes a record of the holders of its Common Stock for the purpose of entitling them to receive a dividend or distribution or subscription or purchase rights or other benefits contemplated under this Section 4 and shall, thereafter and before the distribution to stockholders thereof, legally abandon its plan to pay or deliver such dividend, distribution, subscription or purchase rights or other benefits contemplated under this Section 4, then thereafter 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.

(d)  Escrow of Stock. If after any property becomes distributable pursuant to Section 4 by reason of the taking of any record of the holders of Common Stock, but prior to the occurrence of the event for which such record is taken, the Holder exercises the Warrant during such time, then such Holder shall continue to be entitled to receive any shares of Common Stock issuable upon exercise hereunder by reason of such adjustment and such shares or other property

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shall be held in escrow for the Holder by the Company to be issued to the Holder of this Warrant upon and to the extent that the event actually takes place. Notwithstanding any other provision to the contrary herein, if the event for which such record was taken fails to occur or is rescinded, then such escrowed shares shall be canceled by the Company and escrowed property returned to the Company.

4.4.Change of Control. If there shall occur a Change of Control, then the Holder of this Warrant shall be entitled, at such Holder’s option, either:

(a)  upon request of Holder delivered to the Company within 10 days of receipt of notice of such Change of Control pursuant to Section 5.2, to have the Company (or any such successor or surviving entity) purchase this Warrant from the Holder for an aggregate purchase price, payable in cash on the effective date of consummation of such Change of Control, equal to the product of (i) the difference between the price to be paid in the Change of Control transaction and the Current Warrant Price, multiplied by (ii) the number of shares of Common Stock issuable upon exercise of this Warrant immediately prior to the consummation of such Change of Control; or

(b)  if pursuant to the terms of such Change of Control, shares of common stock of the successor or acquiring corporation, and/or any cash, shares of stock or other securities or property of any nature whatsoever (including warrants or other subscription or purchase rights) in addition to or in lieu of common stock of the successor or acquiring corporation (“Other Property”), are to be received by or distributed to the holders of Common Stock of the Company, and the Holder shall not have elected to have this Warrant purchased by the Company pursuant to Section 4.4(a) above, then the Holder of this Warrant shall have the right thereafter to receive, upon the exercise of the Warrant, the number of shares of common stock of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and/or the Other Property receivable upon or as a result of such Change of Control by a holder of the number of shares of Common Stock into which this Warrant is exercisable immediately prior to such event.

(c)  In case of any such Change of Control described above, to the extent this Warrant has not been fully purchased by the Company pursuant to Section 4.4(a) above, the successor or acquiring corporation (if other than the Company) shall expressly assume the due and punctual observance and performance of each and every covenant and condition of contained in this Warrant to be performed and observed by the Company and all the obligations and liabilities hereunder, subject to such modifications as may be deemed appropriate (as determined by resolution of the Board of Directors of the Company) in order to provide for adjustments of shares of the Common Stock into which this Warrant is exercisable which shall be as nearly equivalent as practicable to the adjustments provided for in Section 4.  The foregoing provisions of this Section 4 shall similarly apply to successive Change of Control transactions.

4.5.Other Action Affecting Common Stock. In case at any time or from time to time the Company shall take any action in respect of its Common Stock, other than the payment of dividends permitted by Section 4 or any other action described in Section 4, then, unless such action will not have a materially adverse effect upon the rights of the holder of this Warrant, the number of shares of Common Stock or other stock into which this Warrant is exercisable and/or

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the purchase price thereof shall be adjusted in such manner as may be equitable in the circumstances; provided, that the mere authorization or issuance of additional shares of capital stock of the Company (other than pursuant to a stock dividend) shall not be considered any action in respect of its Common Stock.

4.6.Certain Limitations. Notwithstanding anything herein to the contrary, the Company agrees not to enter into any transaction that, by reason of any adjustment hereunder, would cause the Current Warrant Price to be less than the par value per share of Common Stock.

4.7.Stock Transfer Taxes. The issue of stock certificates upon exercise of this Warrant shall be made without charge to the Holder for any tax in respect of such issue. The Company shall not, however, be required to pay any tax which may be payable in respect of any transfer involved in the issue and delivery of shares in any name other than that of the Holder of this Warrant, and the Company shall not be required to issue or deliver any such stock certificate unless and until the person or persons requesting the issue thereof shall have paid to the Company the amount of such tax or shall have established to the satisfaction of the Company that such tax has been paid.

5.Notices to Warrant Holders.

5.1.Certificate as to Adjustments. Upon the occurrence of each adjustment or readjustment of the Current Warrant Price, the Company, at its expense, shall promptly compute such adjustment or readjustment in accordance with the terms hereof and prepare and furnish to the Holder of this Warrant a certificate setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment or readjustment is based. The Company shall, upon the written request at any time of the Holder of this Warrant, furnish or cause to be furnished to such Holder a like certificate setting forth (i) such adjustments and readjustments, (ii) the Current Warrant Price at the time in effect and (iii) the number of shares of Common Stock and the amount, if any, or other property which at the time would be received upon the exercise of Warrants owned by such Holder.

5.2.Notice of Corporate Action. If at any time:

(a)the Company shall take a record of the holders of its Common Stock for the purpose of entitling them to receive a dividend (other than a cash dividend payable out of earnings or earned surplus legally available for the payment of dividends under the laws of the jurisdiction of incorporation of the Company) or other distribution, or any right to subscribe for or purchase any evidences of its indebtedness, any shares of stock of any class or any other securities or property, or to receive any other right, or

(b)there shall be any capital reorganization of the Company, any reclassification or recapitalization of the capital stock of the Company or any Change of Control or any consolidation or merger of the Company with, or any sale, transfer or other disposition of all or substantially all the property, assets or business of the Company to, another corporation, or

(c)there shall be a voluntary or involuntary dissolution, liquidation or winding up of the Company;

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then, in any one or more of such cases, the Company shall give to the Holder (i) at least 20 days’ prior written notice of the date on which a record date shall be selected for such dividend, distribution or right or for determining rights to vote in respect of any such reorganization, reclassification, merger, consolidation, sale, transfer, disposition, dissolution, liquidation or winding up, and (ii) in the case of any such Change of Control, reorganization, reclassification, merger, consolidation, sale, transfer, disposition, dissolution, liquidation or winding up, at least 20 days’ prior written notice of the date when the same shall take place. Such notice in accordance with the foregoing clause also shall specify (i) the date on which any such record is to be taken for the purpose of such dividend, distribution or right, the date on which the holders of Common Stock shall be entitled to any such dividend, distribution or right, and the amount and character thereof, and (ii) the date on which any such Change of Control, reorganization, reclassification, merger, consolidation, sale, transfer, disposition, dissolution, liquidation or winding up is to take place and the time, if any such time is to be fixed, as of which the holders of Common Stock shall be entitled to exchange their shares of Common Stock for securities or other property deliverable upon such Change of Control, reorganization, reclassification, merger, consolidation, sale, transfer, disposition, dissolution, liquidation or winding up. Each such written notice shall be sufficiently given if addressed to the Holder at the last address of the Holder appearing on the books of the Company and delivered in accordance with Section 12.2.

5.3.No Rights as Stockholder.  This Warrant does not entitle the Holder to any voting or other rights as a stockholder of the Company prior to exercise and payment for the Warrant Price in accordance with the terms hereof.

6.No Impairment.  The Company shall not by any action, including, without limitation, amending its certificate of incorporation or bylaws 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 terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of the Holder against impairment. Without limiting the generality of the foregoing, the Company will (a) not increase the par value of any shares of Common Stock receivable upon the exercise of this Warrant above the amount payable therefor upon such exercise immediately prior to such increase in par value, (b) take all such action as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable shares of Common Stock upon the exercise of this Warrant, and (c) use its best efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof as may be necessary to enable the Company to perform its obligations under this Warrant. Upon the request of the Holder, the Company will at any time during the period this Warrant is outstanding acknowledge in writing, in form satisfactory to the Holder, the continuing validity of this Warrant and the obligations of the Company hereunder.

7.Reservation and Authorization of Common Stock; Registration With Approval of Any Governmental Authority. From and after the Closing Date, the Company shall at all times reserve and keep available for issue upon the exercise of Warrants such number of its authorized but unissued shares of Common Stock as will be sufficient to permit the exercise in full of all outstanding Warrants. All shares of Common Stock which shall be so issuable, when issued upon exercise of any Warrant and payment therefor in accordance with the terms of such Warrant,

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shall be duly and validly issued and fully paid and nonassessable, and not subject to preemptive rights. Before taking any action which would cause an adjustment reducing the Current Warrant Price below the then par value, if any, of the shares of Common Stock issuable upon exercise of the Warrants, the Company shall take any corporate action which may be necessary in order that the Company may validly and legally issue fully paid and non-assessable shares of such Common Stock at such adjusted Current Warrant Price. Before taking any action which would result in an adjustment in the number of shares of Common Stock for which this Warrant is exercisable or in the Current Warrant Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory body or bodies having jurisdiction thereof. If any shares of Common Stock required to be reserved for issuance upon exercise of Warrants require registration or qualification with any governmental authority under any federal or state law before such shares may be so issued (other than as a result of a prior or contemplated distribution by the Holder of this Warrant), the Company will in good faith and as expeditiously as possible and at its expense endeavor to cause such shares to be duly registered.

8.Taking of Record; Stock and Warrant Transfer Books.  In the case of all dividends or other distributions by the Company to the holders of its Common Stock with respect to which any provision of Section 4 refers to the taking of a record of such holders, the Company will in each such case take such a record and will take such record as of the close of business on a Business Day. The Company will not at any time, except upon dissolution, liquidation or winding up of the Company, close its stock transfer books or Warrant transfer books so as to result in preventing or delaying the exercise or transfer of any Warrant.

9.Loss or Mutilation.  Upon receipt by the Company from the Holder of evidence reasonably satisfactory to it of the ownership of and the loss, theft, destruction or mutilation of this Warrant and indemnity or security reasonably satisfactory to it and reimbursement to the Company of all reasonable expenses incidental thereto and in case of mutilation upon surrender and cancellation hereof, the Company will execute and deliver in lieu hereof a new Warrant of like tenor to the Holder; provided, however, that in the case of mutilation, no indemnity shall be required if this Warrant in identifiable form is surrendered to the Company for cancellation.

10.Office of the Company.  As long as any of the Warrants remain outstanding, the Company shall maintain an office or agency (which may be the principal executive offices of the Company) where the Warrants may be presented for exercise, registration of transfer, division or combination as provided in this Warrant.

11.Limitation of Liability.  No provision hereof, in the absence of affirmative action by the Holder to purchase shares of Common Stock, and no enumeration herein of the rights or privileges of the Holder hereof, shall give rise to any liability of the Holder for the purchase price of any Common Stock, whether such liability is asserted by the Company or by creditors of the Company.

12.Miscellaneous.

12.1.Nonwaiver and Expenses.  No course of dealing or any delay or failure to exercise any right hereunder on the part of the Holder shall operate as a waiver of such right or otherwise

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prejudice Holder’s rights, powers or remedies. If the Company fails to make, when due, any payments provided for hereunder, or fails to comply with any other provision of this Warrant, the Company shall pay to the Holder such amounts as shall be sufficient to cover any third party costs and expenses including, but not limited to, reasonable attorneys’ fees, including those of appellate proceedings, incurred by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.

12.2.Notice Generally.  Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be in writing and shall be deemed given and effective on the earliest of (a) one Trading Day after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto prior to 2:00 p.m. (San Diego time) on a Trading Day, (b) two Trading Days after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto on a day that is not a Trading Day or later than 2:00 p.m. (San Diego time) on any Trading Day, (c) the fourth Trading Day following the date of shipment, if sent by internationally recognized overnight courier service, or (d) upon actual receipt by the party to whom such notice is required to be given.  The address for such notices and communications shall be as set forth below.  The Company shall, concurrently with providing any notice in the manner set forth in the preceding two sentences, transmit a copy of such notice (which copy shall not, by itself, be deemed to constitute notice hereunder)  by email to such email address as is set forth below.

Addresses for Notice:
Inovio Biomedical Corporation
Attention:	Peter Kies
	Chief Financial Officer
11494 Sorrento Valley Road
San Diego, CA 92121-1334
Telephone:	(858) 597-6006
Fax:	(858) 597-0451
Asia Life Sciences Venture Consulting, Inc.
Attention: Vincent Lum, Managing Partner
#208-5455 West Boulevard
Vancouver, B.C., Canada V6M 3W5
Telephone: (   )      -
Fax: (   )       -

12.3.Successors and Assigns. Subject to compliance with the provisions of Section 3.1, this Warrant and the rights evidenced hereby shall inure to the benefit of and be binding upon the successors of the Company and the successors and assigns of the Holder. The provisions of this Warrant are intended to be for the benefit of all Holders from time to time of this Warrant, and shall be enforceable by any such Holder.

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12.4.Amendment.  This Warrant may be modified or amended or the provisions of this Warrant waived with the written consent of both the Company and the Holder.

12.5.Severability.  Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be modified to the extent of such prohibition or invalidity and with the aim of effecting the intent of the parties to the maximum extent possible, without invalidating the remainder of such provision or the remaining provisions of this Warrant.

12.6.Headings.  The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant.

12.7.Governing Law.  This Warrant and the transactions contemplated hereby shall be deemed to be consummated in the State of California and shall be governed by and interpreted in accordance with the local laws of the State of California without regard to the provisions thereof relating to conflicts of laws. The Company hereby irrevocably consents to the exclusive jurisdiction of the State and Federal courts located in Los Angeles, California in connection with any action or proceeding arising out of or relating to this Warrant. In any such litigation the Company agrees that the service thereof may be made by certified or registered mail directed to the Company pursuant to Section 12.2.

[Signature Page Follows]

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IN WITNESS WHEREOF, Inovio Biomedical Corporation has caused this Warrant to be executed by its duly authorized officer and attested by its Secretary.

Dated: August     , 2007

	INOVIO BIOMEDICAL CORPORATION
	By:
	Name:	Avtar Dhillon
	Title:	President & Chief Executive Officer
Attest:
By:
Name: Douglas Murdock
Title: Secretary

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EXHIBIT A

SUBSCRIPTION FORM

[To be executed only upon exercise of Warrant]

1.The undersigned hereby elects to purchase        shares of the Common Stock of Inovio Biomedical Corporation pursuant to the terms of the attached Warrant, and tenders herewith payment of the purchase price of such shares in full.

2.Please issue a certificate or certificates representing said shares in the name of the undersigned or in such other name as is specified below:

(Name)

(Address)

[and, if such shares of Common Stock shall not include all of the shares of Common Stock issuable as provided in this Warrant, that a new Warrant of like tenor and date for the balance of the shares of Common Stock issuable hereunder be delivered to the undersigned.]

(Name of Registered Owner)

(Signature of Registered Owner)

(Street Address)

(Country)(Postal Code)

NOTICE: The signature on this subscription must correspond with the name as written upon the face of the Warrant in every particular, without alteration or enlargement or any change whatsoever.

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EXHIBIT B

ASSIGNMENT FORM

FOR VALUE RECEIVED the undersigned registered owner of this Warrant for the purchase of shares of common stock of Inovio Biomedical Corporation hereby sells, assigns and transfers unto the Assignee named below all of the rights of the undersigned under this Warrant, with respect to the number of shares of common stock set forth below:

(Name and Address of Assignee)

(Number of Shares of Common Stock)

and does hereby irrevocably constitute and appoint              attorney-in-fact to register such transfer on the books of the Company, maintained for the purpose, with full power of substitution in the premises.

Dated:

(Print Name and Title)

(Signature)

(Witness)

NOTICE: The signature on this assignment must correspond with the name as written upon the face of the Warrant in every particular, without alteration or enlargement or any change whatsoever.

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EX-5.1

Exhibit 5.1

[K&L GATES LETTERHEAD]

August 3, 2007

Inovio Biomedical Corporation
11494 Sorrento Valley Road
San Diego, California 92121

Re: Prospectus Supplement No. 5 to Prospectus dated May 25, 2006

Ladies and Gentlemen:

You have requested our opinions as to the matters set forth below in connection with the filing by Inovio Biomedical Corporation, a Delaware corporation (the “Company”), of Prospectus Supplement No. 5 dated August 3, 2007 (the “Prospectus Supplement”) to the Company’s Prospectus dated May 25, 2006 (the “Prospectus”) included as part of the Company’s Registration Statement on Form S-3 (SEC File No. 333-134084) that was declared effective by the Securities and Exchange Commission (the “SEC”) on May 25, 2006 (the “Registration Statement”).  The Prospectus Supplement covers the offering and sale of up to of up to 230,000 shares of the Company’s common stock, par value $0.001 per share (the “Shares”), warrants to purchase up to 150,000 shares of the Company’s common stock at an exercise price of $3.00 per share (the “Warrants”), and up to 150,000 shares of the Company’s common stock issuable upon the exercise of such warrants (the “Warrant Shares”).

In connection with rendering our opinions set forth below, we have examined the Registration Statement, including the exhibits filed therewith, the Prospectus, the Prospectus Supplement, the Company’s Certificate of Incorporation, as amended, the Company’s Bylaws, as amended, the corporate resolutions or other actions of the Company that authorize and provide for the issuance and sale of the Shares, Warrants and Warrant Shares, and that certain letter agreement dated as of August 3, 2007 (the “Agreement”) under which the Shares, Warrants and Warrant Shares are to be issued and sold, and, subject to the limitations and qualifications expressed elsewhere in this letter, we have made such other investigations as we have deemed necessary or appropriate.  As to certain matters of fact that are material to our opinions, we have examined and relied upon certificates of public officials and on a certificate of officers of the Company.  We have not independently established any of the facts so relied on.

For purposes of this opinion letter,we have made the assumptions that are customary in opinion letters of this kind, including the assumptions as to the genuineness of all signatures on original documents, the authenticity of all documents submitted to us as originals, the conformity to originals of all documents submitted to us as copies thereof, and the due execution and delivery of all documents where due execution and delivery are prerequisites to the effectiveness thereof.  We have not verified any of those assumptions.

Our opinions set forth below are limited to the provisions of the General Corporation Law of the State of Delaware (the “DGCL”) and the applicable provisions of the Delaware Constitution and reported judicial decisions interpreting those laws.  We, however, are not licensed to practice law in the State of Delaware.  We are not opining on, and we assume no responsibility for, the applicability to or effect on any of the matters covered herein of any other laws, the laws of any other jurisdiction or the local laws of any jurisdiction.

Inovio Biomedical Corporation
August 3, 2007
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Based upon and subject to the foregoing and in reliance thereon, and subject to the assumptions, qualifications, limitations and exceptions set forth herein, we are of the opinion that:

1. The Shares are duly authorized for issuance by the Company and when issued and sold in accordance with the Registration Statement, the Prospectus, Prospectus Supplement and the Agreement will be validly issued, fully paid, and nonassessable;

2. The Warrants are duly authorized for issuance by the Company and when issued and sold in accordance with the Registration Statement, the Prospectus, Prospectus Supplement and the Agreement will be validly issued and binding obligations of the Company; and

3. The Warrant Shares issuable upon exercise of the Warrants have been duly authorized and reserved for issuance and when the Warrant Shares are issued following issuance of the Warrants and in accordance with the terms of the Warrants, the Warrant Shares will be validly issued, fully paid and nonassessable.

The foregoing opinions are rendered as of the date of this letter.  We assume no obligation to update or supplement our opinions to reflect any changes of law or fact that may occur.

We are furnishing this opinion letter to you solely in connection with the Prospectus Supplement.  You may not rely on this opinion letter in any other connection, and it may not be furnished or relied upon by any other person for any purpose, without our specific prior written consent.  We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the use of our name under the caption “Legal Matters” in the Prospectus Supplement.  In giving our consent we do not thereby admit that we are experts with respect to any part of the Registration Statement, the Prospectus or any Prospectus Supplement within the meaning of the term “expert,” as used in Section 11 of the Securities Act of 1933, as amended (the “Securities Act”), or the rules and regulations promulgated thereunder by the SEC, nor do we admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations thereunder.

Yours truly,

/s/ Kirkpatrick & Lockhart Preston Gates Ellis LLP

Kirkpatrick & Lockhart Preston Gates Ellis LLP

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