THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A
VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH SALE
OR DISPOSITION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT
RELATED THERETO OR AN OPINION OF COUNSEL FOR THE COMPANY THAT SUCH REGISTRATION
IS NOT REQUIRED UNDER THE SECURITIES ACT OF 1933.

PACIFIC BIOMETRICS, INC.

Common Stock Purchase Warrant

          Date of Issuance: January 31, 2005   Number of Shares: 105,263 shares
        (subjecttoadjustment)

Pacific Biometrics, Inc., a Delaware corporation (the “Company”), for value
received, hereby certifies that Source Capital Group, Inc., or its registered
assigns (the “Holder”), is entitled, subject to the terms set forth below, to
purchase from the Company up to 105,263 shares of Company common stock, $.01 par
value per share (the “Common Stock”), at an exercise price of $1.37 per share on
the terms and conditions set forth herein. The number of shares of Common Stock
issuable upon exercise of this Warrant, and the exercise price per share, each
as adjusted from time to time pursuant to the provisions of this Warrant, are
hereinafter referred to as the “Warrant Stock” and the “Exercise Price,”
respectively. This Warrant is granted to Holder pursuant to the terms of that
certain engagement agreement between the Company and Holder in connection with
the Company’s debt financing with Laurus Master Funds, Ltd., in which the
Company issued a convertible promissory note, dated January 31, 2005, to Laurus
in the aggregate principal amount of $1.5 million (the “Note”).

1. Vesting and Exercisability of Warrant. This Warrant shall be exercisable only
as and to the extent that principal and accrued interest under the Note is
converted into shares of Common Stock. From time to time, as principal and
accrued interest under the Note is converted into Common Stock, this Warrant
shall vest and be exercisable into a cumulative number of shares (less any
number of shares previously exercised hereunder) equal to the quotient obtained
by dividing (a) 8% of the dollar amount of any principal and interest under the
Note converted into Common Stock, by (b) $1.17. Only whole shares shall be
issuable hereunder; accordingly, in the event any such calculation results in a
fraction, this Warrant shall be exercisable only for such whole number of
shares. By way of example, if $100,000.00 of principal and interest under the
Note is converted into Common Stock, the foregoing calculation would result in
6,837.6, and accordingly this Warrant would be exercisable only for 6,837
shares. For any amount of principal and interest under the Note that is paid or
settled in cash or otherwise, and that is not converted into Common Stock, no
shares underlying this Warrant shall vest and become exercisable. There are no
assurances as to the amount, if any, of principal and interest under the Note
that will be converted into Common Stock, or as to the number of shares
hereunder that will vest and become exercisable. In no event shall the maximum
number of shares exercisable under this Warrant exceed 105,263 shares (subject
to adjustment pursuant to Section 6 below).

2. Manner of Exercise; Net Exercise.

(a) This Warrant may be exercised in whole or in part by delivering to the
Company at its principal place of business (i) this Warrant, (ii) the form of
Election to Purchase attached hereto as Exhibit A duly completed and executed by
Holder, and (iii) cash, wire transfer, or bank check payable to the Company, in
the amount of the Exercise Price multiplied by the number of shares for which
this Warrant is being exercised (the “Purchase Price”). Each exercise of this
Warrant shall be deemed to have been effected immediately prior to the close of
business on the day on which this Warrant shall have been surrendered to the
Company as provided herein or at such later date as may be specified in the
executed form of Election to Purchase.

(b) Notwithstanding the cash payment provisions set forth above, Holder may
elect to exercise this Warrant by converting this Warrant into shares of Warrant
Stock by delivering this Warrant and the Notice of Net Issuance Exercise
attached hereto as Exhibit B duly completed and executed by the Holder to the
Company at its principal place of business, in which case the Company shall
issue to the Holder the number of shares of Warrant Stock determined as follows:

X = (A — B) x C
A

      Where: X = the number of shares of Warrant Stock issuable upon net
issuance exercise pursuant to the provisions of this Section 2(b).  

      A = the Fair Market Value (as defined below) of one share of Warrant Stock
on the date of net issuance exercise.  

      B = the Exercise Price for one share of Warrant Stock under this Warrant.
 

      C = the number of shares of Warrant Stock as to which this Warrant is
exercised.  

For purposes of the above calculation, the Fair Market Value of a share of
Warrant Stock shall be determined in good faith by the Board of Directors of the
Company; provided, however, that if a public market for the Warrant Stock exists
at the time of such exercise, then such Fair Market Value shall be deemed to be
equal to(i) the average of the closing bid and asked prices of the Warrant Stock
as quoted in the Over-the-Counter Market Summary or (ii) the last reported sale
price of the Warrant Stock or the closing price quoted on the Nasdaq National or
SmallCap Market System or on any exchange on which the Warrant Stock is then
listed, whichever is applicable, for the five trading days prior to the date of
exercise of this Warrant.

If the foregoing calculation results in a negative number, then no shares of
Warrant Stock shall be issued upon net issuance exercise pursuant to this
Section 2(b). Upon net issuance exercise in accordance with this Section 2(b),
the Holder shall be entitled to receive from the Company a stock certificate in
proper form representing the number of shares of Warrant Stock determined in
accordance with the foregoing. Upon any such net issuance exercise, the number
of shares of Warrant Stock purchasable upon subsequent exercise of this Warrant
shall be reduced by the number of shares of Warrant Stock with respect to which
this Warrant was exercised in the net issuance exercise.

3. Delivery of Stock Certificate. As soon as practicable after the exercise of
this Warrant, in full or in part, and in any event within 10 days thereafter,
the Company at its expense will cause to be issued in the name of and deliver to
the Holder (a) a certificate or certificates for the number of fully paid and
nonassessable shares of Warrant Stock to which Holder shall be entitled upon
such exercise and (b) if applicable, a new Warrant of like tenor to purchase up
to that number of shares of Warrant Stock, if any, not previously exercised by
Holder. Holder shall for all purposes be deemed to have become the holder of
record of such shares of Warrant Stock on the date on which this Warrant was
properly exercised in accordance with Section 2, irrespective of the date of
delivery of the certificate or certificates representing the Warrant Stock;
provided that, if the date of such exercise is a date when the stock transfer
books of the Company are closed, such person shall be deemed to have become the
holder of record of such shares of Warrant Stock at the close of business on the
next succeeding date on which the stock transfer books are open.

4. Reservation of Warrant Stock. The Company covenants and agrees that the
Company will at all times have authorized and reserved a sufficient number of
shares of Common Stock to provide for the exercise of the rights represented by
this Warrant.

5. Termination. To the extent not earlier exercised, the Warrant evidenced
hereby shall be void and of no effect and all rights hereunder shall cease upon
the earlier of (a) 5:00 p.m. Pacific Time on January 31, 2010, or (b) the
closing of any merger, consolidation or other reorganization of the Company with
or into any other corporation or other business entity, or the sale of all or
substantially all of its assets, or the liquidation or dissolution of the
Company (each, a “Transaction”). The Company shall provide Holder with written
notice not less than 10 days prior to the closing of any proposed Transaction.
All restrictions set forth herein on the shares of Warrant Stock issued upon
exercise of any rights hereunder shall survive such exercise and expiration of
the rights granted hereunder.

6. Adjustments to Warrant. In case the Company shall issue any shares of Common
Stock as a stock dividend or subdivide the number of outstanding shares of
Common Stock into a greater number of shares, then, in either of such cases, the
Exercise Price in effect at the time of such action shall be proportionately
reduced and the number of shares of Warrant Stock at that time purchasable
pursuant to this Warrant shall be proportionately increased; and, conversely, in
the event the Company shall contract the number of outstanding shares of Common
Stock by combining such shares into a smaller number of shares, then, in such
case, the Exercise Price in effect at the time of such action shall be
proportionately increased and the number of shares of Warrant Stock at that time
purchasable pursuant to this Warrant shall be proportionately decreased. Any
calculations of adjustments shall be made to the nearest cent or to the nearest
one whole share, as the case may be.

7. Restrictions on Transfer. Neither this Warrant nor the Warrant Stock have
been registered under the Securities Act of 1933, as amended (the “Securities
Act”), or any applicable state law, and no interest therein may be sold,
distributed, assigned, offered, pledged or otherwise transferred unless
(a) there is an effective registration statement under such Act and applicable
state securities laws covering any such transaction involving said securities,
(b) the Company receives an opinion of legal counsel for Holder (concurred in by
legal counsel for the Company) stating that such transaction is exempt from
registration, or (c) the Company otherwise satisfies itself that such
transaction is exempt from registration.

8. Legend. A legend setting forth or referring to the restrictions stated in
Section 7 shall be placed on this Warrant, any replacement hereof and any
certificates representing Warrant Stock, and a stop transfer restriction or
order shall be placed on the books of the Company and with any transfer agents
against this Warrant and shares of Warrant Stock until they may be legally sold
or otherwise transferred.

9. Fractional Shares. No fractional shares shall be issued upon the exercise of
the Warrant. In lieu of fractional shares, the Company shall round the number of
shares to be issued upon exercise of this Warrant to the nearest whole share.

10. Holder as Owner. Unless this Warrant is transferred or assigned, the Company
may deem and treat the Holder at all times as the absolute owner of the Warrant
evidenced hereby for all purposes regardless of any notice to the contrary.

11. No Rights as Shareholder. This Warrant shall not entitle Holder to any
voting rights or any other rights as a shareholder of the Company, or to any
other rights whatsoever except the rights stated herein; and no dividend or
interest shall be payable or shall accrue in respect of this Warrant or the
shares purchasable hereunder unless, and until, and except to the extent that,
this Warrant shall be exercised.

12. Piggyback Registration Rights. Holder shall be entitled to certain piggyback
registration rights with respect to the Warrant Stock as set forth on the
attached Exhibit C.

13. Exchange or Destruction of Warrant. This Warrant is exchangeable, without
expense to Holder and upon delivery hereof to the Company, for Warrants of
different denominations entitling Holder to purchase shares of Warrant Stock
equal in total number and identical in type to the shares of Warrant Stock
covered by this Warrant. In addition, upon receipt by the Company of evidence
reasonably satisfactory to the Company of the loss, theft, destruction, or
mutilation of this Warrant and, in the case of any such loss, theft or
destruction, upon receipt of an affidavit and indemnity reasonably satisfactory
to the Company, or in the case of any such mutilation upon surrender and
cancellation of such Warrant, the Company at its expense will make and deliver a
new Warrant, of like tenor, in lieu of the lost, stolen, destroyed or mutilated
Warrant.

14. Notices. Unless otherwise provided, any notice, request or other document
required or permitted to be given or delivered to Holder hereof or the Company
shall be given in writing and shall be deemed effectively given (a) upon
personal delivery to the party to be notified, (b) upon confirmation of receipt
by fax by the party to be notified, or (c) upon receipt if delivered by prepaid
overnight delivery, courier service or registered or certified mail addressed,
(i) if to Holder, to the address of Holder most recently furnished in writing to
the Company and (ii) if to the Company, to the address set forth below, or in
either case at such other address as such party may designate by five days’
advance written notice to the other party given in the foregoing manner.

15. Successors and Assigns. The terms and provisions of this Warrant shall be
binding upon the Company and Holder and their respective successors and assigns,
subject at all times to the restrictions set forth herein.

16. Applicable Law. The validity, interpretation and performance of this Warrant
shall be governed by the laws of the State of Washington.

[Remainder of Page Intentionally Left Blank; Signature Page Follows]

1

EXECUTED as of the day and year first above written.

PACIFIC BIOMETRICS, INC.

     
By: /s/ Ronald R. Helm
 

 
     

 
    Ronald R. Helm, Chief Executive Officer

 
   
Address:
  220 West Harrison St.

      Seattle, WA 98119

2

Exhibit A to Common Stock Purchase Warrant

ELECTION TO PURCHASE

Pacific Biometrics, Inc.
220 West Harrison St.
Seattle, WA 98119
Attention: Corporate Secretary

The undersigned hereby irrevocably elects to purchase      shares of Common
Stock of Pacific Biometrics, Inc., a Delaware corporation (the “Company”),
issuable upon the exercise of the attached Warrant, and requests that
certificates for such shares be issued in the name of and delivered to the
undersigned at the address stated below. If said number of shares shall not be
all the shares which may be purchased pursuant to the attached Warrant, the
Company shall issue a new Warrant to the Holder evidencing the right of the
Holder to purchase the balance of such shares under terms identical to the
attached Warrant.

The undersigned hereby agrees with and represents to the Company that such
shares of Common Stock are acquired for investment and not with a view to, or
for sale in connection with, any distribution or public offering thereof within
the meaning of the Securities Act of 1933, as amended, and that the undersigned
has no present intention of distributing or reselling such shares. The
undersigned acknowledges and agrees that the exercise of the attached Warrant
and the issuance and transfer of the Common Stock to be purchased are subject to
Sections 7 and 8 of the attached Warrant.

         
Payment enclosed in the amount of:
  $ —  
Dated: ______________, 200__
       
Name of Holder of Warrant (please print):
    —  
Address:
    —  
 
    —  
 
    —  
Signature:
    —  

3

Exhibit B to Common Stock Purchase Warrant

NOTICE OF NET ISSUANCE EXERCISE

Pacific Biometrics, Inc.
220 West Harrison St.
Seattle, WA 98119
Attention: Corporate Secretary

The undersigned hereby irrevocably elects to convert      % of the attached
Warrant into such number of shares of Common Stock of Pacific Biometrics, Inc.
(the “Company”) as is determined pursuant to Section 2(b) of the attached
Warrant. The undersigned requests that certificates for such net issuance shares
be issued in the name of and delivered to the undersigned, at the address stated
below. If the Holder does not elect to convert this entire Warrant, the Company
shall issue a new Warrant to the Holder evidencing the Holder’s right to
purchase the remaining portion of shares under terms identical to the attached
Warrant.

The undersigned hereby agrees with and represents to the Company that such
shares of Common Stock are acquired for investment and not with a view to, or
for sale in connection with, any distribution or public offering thereof within
the meaning of the Securities Act of 1933, as amended, and that the undersigned
has no present intention of distributing or reselling such shares. The
undersigned acknowledges and agrees that the exercise of the attached Warrant
and the issuance and transfer of the Common Stock to be purchased are subject to
Sections 7 and 8 of the attached Warrant.

         
Dated: ______________, 200__
       
Name of holder of Warrant:
    —      (please print)

Address:
    —  
 
    —  
 
    —  
Signature:
    —  

4

Exhibit C to Common Stock Purchase Warrant

PIGGYBACK REGISTRATION RIGHTS

1. Registration Rights. Holder shall be entitled to the following registration
rights:

1.1 Definitions

(a) The terms “register,” “registered,” and “registration” refer to a
registration effected by preparing and filing a registration statement or
similar document in compliance with the Securities Act of 1933, as amended (the
“Securities Act”), and the declaration or ordering of effectiveness of such
registration statement or document;

(b) The term “Registrable Securities” means (i) the shares of Common Stock
issued on exercise of the common stock purchase warrant by the Holder, and
(ii) any other shares of Common Stock of the Company issued as (or issuable upon
the conversion or exercise of any warrant, right or other security which is
issued as) a dividend or other distribution with respect to, or in exchange for
or in replacement of, the Common Stock; provided, however, that the foregoing
definitions of Registrable Securities shall exclude in all cases any Registrable
Securities sold by a person in a transaction in which his or her rights
hereunder are not assigned. Notwithstanding the foregoing, such Common Stock or
other securities shall only be treated as Registrable Securities if and so long
as they have not been (A) sold to or through a broker or dealer or underwriter
in a public distribution or a public securities transaction, or (B) sold in a
transaction exempt from the registration and prospectus delivery requirements of
the Securities Act under Section 4(1) thereof so that all transfer restrictions,
and restrictive legends with respect thereto, if any, are removed upon the
consummation of such sale;

(c) The number of shares of “Registrable Securities then outstanding” shall be
determined by the number of shares of Common Stock outstanding which are, and
the number of shares of Common Stock issuable pursuant to then exercisable or
convertible securities which are, Registrable Securities;

(d) The term “Holder” means any person owning or having the right to acquire
Registrable Securities;

(e) The term “SEC” means the Securities and Exchange Commission.

1.2 Piggy Back Registration Rights. If the Company proposes to register
(including for this purpose a registration effected by the Company for
shareholders other than the Holders) any of its stock or other securities under
the Securities Act in connection with the public offering of such securities
solely for cash (other than a registration relating solely to the sale of
securities to participants in a Company stock plan or a transaction covered by
Rule 145 under the Securities Act, a registration in which the only stock being
registered is Common Stock issuable upon conversion of debt securities which are
also being registered, or any registration on any form which does not include
substantially the same information as would be required to be included in a
registration statement covering the sale of the Registrable Securities, as the
case may be), the Company shall, at such time, promptly give Holder written
notice of such registration. Upon the written request of Holder, as the case may
be, given within 20 days after mailing of such notice by the Company in
accordance with Section 14 of the Warrant, the Company shall, subject to the
provisions of Section 1.5, cause to be registered under the Securities Act all
of the Registrable Securities, as the case may be, that such Holder has
requested to be registered.

1.3 Obligations of the Company. Whenever required under this Section 1 to effect
the registration of any Registrable Securities, the Company shall, as
expeditiously as reasonably possible:

(a) Prepare and file with the SEC a registration statement with respect to such
Registrable Securities and use its best efforts to cause such registration
statement to become effective, and to keep such registration statement
continuously effective for a period of 120 days following its initial effective
date.

(b) Prepare and file with the SEC such amendments and supplements to such
registration statement and the prospectus used in connection with such
registration statement as may be necessary to comply with the provisions of the
Securities Act with respect to the disposition of all securities covered by such
registration statement.

(c) Furnish to the Holders such numbers of copies of a prospectus, including a
preliminary prospectus, in conformity with the requirements of the Securities
Act, and such other documents as they may reasonably request in order to
facilitate the disposition of Registrable Securities owned by them.

(d) Use its best efforts to register and qualify the securities covered by such
registration statement under such other securities or Blue Sky laws of such
jurisdictions as shall be reasonably requested by the Holders, provided that the
Company shall not be required in connection therewith or as a condition thereto
to qualify to do business or to file a general consent to service of process in
any such states or jurisdictions where it has not already done so.

(e) In the event of any underwritten public offering, enter into and perform its
obligations under an underwriting agreement, in usual and customary form, with
the managing underwriter of such offering. Each Holder participating in such
underwriting shall also enter into and perform its obligations under such an
agreement.

(f) Notify each Holder of Registrable Securities covered by such registration
statement at any time when a prospectus relating thereto is required to be
delivered under the Securities Act of the happening of any event as a result of
which the prospectus included in such registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading in the light of the circumstances then existing.

(g) Cause all such Registrable Securities registered pursuant hereunder to be
listed on each securities exchange on which similar securities issued by the
Company are then listed.

(h) Provide a transfer agent and registrar for all Registrable Securities
registered pursuant hereunder and a CUSIP number for all such Registrable
Securities, in each case not later than the effective date of such registration.

(i) Use its best efforts to furnish, at the request of any Holder requesting
registration of Registrable Securities, as the case may be, on the date that
such Registrable Securities are delivered to the underwriters for sale in
connection with a registration pursuant to this Section, if such securities are
being sold through underwriters, or, if such securities are not being sold
through underwriters, on the date that the registration statement with respect
to such securities becomes effective, (i) an opinion, dated such date, of the
counsel representing the Company for the purposes of such registration, in form
and substance as is customarily given to underwriters in an underwritten public
offering, addressed to the underwriters, if any, and to the Holders requesting
registration of Registrable Securities, and (ii) a letter dated such date, from
the independent certified public accountants of the Company, in form and
substance as is customarily given by independent certified public accountants to
underwriters in an underwritten public offering, addressed to the underwriters,
if any, and to the Holders requesting registration of Registrable Securities.

1.4 Expenses. All expenses other than underwriting discounts and commissions
incurred in connection with registration pursuant to this Section, including the
registration, filing, and qualification fees, printers’ and accounting fees,
fees and disbursements of counsel for the Company shall be borne by the Company.
In addition, each Holder shall be bear and pay all legal fees and expenses
incurred by legal counsel selected by such Holder in connection with the review
of such registration statement, filing or qualification of the Registrable
Securities.

1.5 Underwriting Requirements. In connection with any offering involving an
underwriting of shares of the Company’s capital stock, the Company shall not be
required to include any of the Holders’ securities in such underwriting unless
they accept the terms of the underwriting as agreed upon between the Company and
the underwriters selected by it (or by other persons entitled to select the
underwriters), and then only in such quantity as the underwriters determine in
their sole discretion will not jeopardize the success of the offering by the
Company.

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

1.7 Indemnification

(a) To the extent permitted by law, the Company will indemnify and hold harmless
each Holder, the partners, members, officers, directors and shareholders of each
Holder, any underwriter (as defined in the Securities Act) for such Holder, and
each person, if any, who controls such Holder or underwriter within the meaning
of the Securities Act or the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), against any losses, claims, damages, or liabilities (joint or
several) to which they may become subject under the Securities Act, the Exchange
Act or other federal or state law, insofar as such losses, claims, damages, or
liabilities (or actions in respect thereof) arise out of or are based upon any
of the following statements, omissions or violations (collectively a
“Violation”): (i) any untrue statement or alleged untrue statement of a material
fact contained in such registration statement, including any preliminary
prospectus or final prospectus contained therein or any amendments or
supplements thereto, (ii) the omission or alleged omission to state therein a
material fact required to be stated therein, or necessary to make the statements
therein not misleading, or (iii) any violation or alleged violation by the
Company of the Securities Act, the Exchange Act, any state securities law or any
rule or regulation promulgated under the Securities Act, the Exchange Act or any
state securities law; and the Company will pay to each such indemnified person,
as incurred, any legal or other expenses reasonably incurred by them in
connection with investigating or defending any such loss, claim, damage,
liability, or action; provided, however, that the indemnity agreement contained
in this subsection 1.7(a) shall not apply to amounts paid in settlement of any
such loss, claim, damage, liability, or action if such settlement is effected
without the consent of the Company (which consent shall not be unreasonably
withheld), nor shall the Company be liable in any such case for any such loss,
claim, damage, liability, or action to the extent that it arises out of or is
based upon a Violation which occurs in reliance upon and in conformity with
written information furnished expressly for use in connection with such
registration by any such indemnified person.

(b) To the extent permitted by law, each selling Holder severally but not
jointly will indemnify and hold harmless the Company, each of its directors,
each of its officers who has signed the registration statement, each person, if
any, who controls the Company within the meaning of the Securities Act, any
underwriter, any other selling security holder in such registration statement
and any controlling person of any such underwriter or other Holder, against any
losses, claims, damages, or liabilities (joint or several) to which any of the
foregoing persons may become subject, under the Securities Act, the Exchange Act
or other federal or state law, insofar as such losses, claims, damages, or
liabilities (or actions in respect thereto) arise out of or are based upon any
Violation, in each case to the extent (and only to the extent) that such
Violation occurs in reliance upon and in conformity with written information
furnished by such Holder expressly for use in connection with such registration;
and each such Holder will pay, as incurred, any legal or other expenses
reasonably incurred by any person intended to be indemnified pursuant to this
subsection 1.7(b), in connection with investigating or defending any such loss,
claim, damage, liability, or action; provided, however, that the indemnity
agreement contained in this subsection 1.7(b) shall not apply to amounts paid in
settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of the Holder, which consent shall
not be unreasonably withheld; provided, that, in no event shall any indemnity
under this subsection 1.7(b) exceed the net proceeds from the offering received
by such Holder, except in the case of willful fraud by such Holder.

1.8. No Assignment. The rights to cause the Company to register the Registrable
Securities pursuant hereto may not be assigned to any party without the express
written consent of the Company.

1.9 Termination of Registration Rights. No Holder shall be entitled to exercise
any right provided for in this Section 1 after the earlier of (i) January 31,
2010, or (ii) such time as Rule 144 or another similar exemption under the
Securities Act is available for the sale of all of such Holder’s Registrable
Securities during a three-month period without registration.

1.10 Amendment or Modification of Registration Rights. The rights granted to
Holder hereunder may not be amended or modified without the written consent of
the Company and Holders of a majority of the then outstanding Registrable
Securities. Any amendment approved pursuant to the terms of this Section 1.10
shall be binding on, and enforceable against, all other Holders.

5