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EXHIBIT C

EXHIBIT C

NEITHER THESE SECURITIES NOR THE SECURITIES FOR WHICH THESE SECURITIES ARE
EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR
THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN COMPLIANCE WITH APPLICABLE STATE
SECURITIES LAWS OR BLUE SKY LAWS. THESE SECURITIES AND THE SECURITIES ISSUABLE
UPON EXERCISE OF THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE
MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.

StockerYale, Inc.

ADDITIONAL INVESTMENT RIGHT

Warrant No. [                          ]        

Dated: February 3, 2004

StockerYale, Inc., a Massachusetts corporation (the "Company"), hereby certifies
that, for value received, [Name of Holder] or its registered assigns (the
"Holder"), is entitled to purchase from the Company up to a total of [ ] shares
of common stock, $0.001 par value per share (the "Common Stock"), of the Company
(each such share, a "Additional Investment Right Share" and all such shares, the
"Additional Investment Right Shares") at an exercise price equal to $1.15 per
share (as adjusted from time to time as provided in Section 9, the "Exercise
Price"), at any time and from time to time from and after the date hereof and
through and including the 90th Trading Day from the Effective Date (the
"Expiration Date"), and subject to the following terms and conditions. This
Additional Investment Right (this "Additional Investment Right") is one of a
series of similar Additional Investment Rights issued pursuant to that certain
Securities Purchase Agreement, dated as of the date hereof, by and among the
Company and the Purchasers identified therein (the "Purchase Agreement"). All
such Additional Investment Rights are referred to herein, collectively, as the
"Additional Investment Rights."

   1. Definitions. In addition to the terms defined elsewhere in this Additional
Investment Right, capitalized terms that are not otherwise defined herein have
the meanings given to such terms in the Purchase Agreement.

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   2. Registration of Additional Investment Right. The Company shall register
this Additional Investment Right, upon records to be maintained by the Company
for that purpose (the "Additional Investment Right Register"), in the name of
the record Holder hereof from time to time. The Company may deem and treat the
registered Holder of this Additional Investment Right as the absolute owner
hereof for the purpose of any exercise hereof or any distribution to the Holder,
and for all other purposes, absent actual notice to the contrary.

   3. Registration of Transfers. The Company shall register the transfer of any
portion of this Additional Investment Right in the Additional Investment Right
Register, upon surrender of this Additional Investment Right, with the Form of
Assignment attached hereto duly completed and signed, to the Transfer Agent or
to the Company at its address specified herein. Upon any such registration or
transfer, a new warrant to purchase Common Stock, in substantially the form of
this Additional Investment Right (any such new warrant, a "New Additional
Investment Right"), evidencing the portion of this Additional Investment Right
so transferred shall be issued to the transferee and a New Additional Investment
Right evidencing the remaining portion of this Additional Investment Right not
so transferred, if any, shall be issued to the transferring Holder. The
acceptance of the New Additional Investment Right by the transferee thereof
shall be deemed the acceptance by such transferee of all of the rights and
obligations of a holder of a Additional Investment Right.

   4. Exercise and Duration of Additional Investment Rights.

(a) This Additional Investment Right shall be exercisable by the registered
Holder at any time and from time to time on or after the date hereof to and
including the Expiration Date. At 5:30 P.M., New York City time on the
Expiration Date, the portion of this Additional Investment Right not exercised
prior thereto shall be and become void and of no value.

(b) The Holder may exercise this Additional Investment Right by delivering to
the Company (i) an exercise notice, in the form attached hereto (the "Exercise
Notice"), appropriately completed and duly signed, and (ii) payment of the
Exercise Price for the number of Additional Investment Right Shares as to which
this Additional Investment Right is being exercised (which may take the form of
a "cashless exercise" if so indicated in the Exercise Notice and if a "cashless
exercise" may occur at such time pursuant to Section 10 below), and the date
such items are delivered to the Company (as determined in accordance with the
notice provisions hereof) is an "Exercise Date." The Holder shall not be
required to deliver the original Additional Investment Right in order to effect
an exercise hereunder. Execution and delivery of the Exercise Notice shall have
the same effect as cancellation of the original Additional Investment Right and
issuance of a New Additional Investment Right evidencing the right to purchase
the remaining number of Additional Investment Right Shares.

   5. Delivery of Additional Investment Right Shares.

(a) Upon exercise of this Additional Investment Right, the Company shall
promptly (but in no event later than three Trading Days after the Exercise Date)
issue or cause to be issued and cause to be delivered to or upon the written
order of the Holder and in such name or names as the Holder may designate, a
certificate for the Additional Investment Right Shares issuable upon such
exercise, free of restrictive legends unless a registration statement covering
the resale of the Additional Investment Right Shares and naming the Holder as a
selling stockholder thereunder is not then effective and the Additional
Investment Right Shares are not freely transferable without volume restrictions
pursuant to Rule 144 under the Securities Act. The Holder, or any Person so
designated by the Holder to receive Additional Investment Right Shares, shall be
deemed to have become holder of record of such Additional Investment Right
Shares as of the Exercise Date. The Company shall, upon request of the Holder,
use its best efforts to deliver Additional Investment Right Shares hereunder
electronically through the Depository Trust Corporation or another established
clearing corporation performing similar functions.

(b) This Additional Investment Right is exercisable, either in its entirety or,
from time to time, for a portion of the number of Additional Investment Right
Shares. Upon surrender of this Additional Investment Right following one or more
partial exercises, the Company shall issue or cause to be issued, at its
expense, a New Additional Investment Right evidencing the right to purchase the
remaining number of Additional Investment Right Shares.

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(c) The Company's obligations to issue and deliver Additional Investment Right
Shares in accordance with the terms hereof are absolute and unconditional,
irrespective of any action or inaction by the Holder to enforce the same the
recovery of any judgment against any Person or any action to enforce the same,
or any setoff, counterclaim, recoupment, limitation or termination, or any
breach or alleged breach by the Holder or any other Person of any obligation to
the Company or any violation or alleged violation of law by the Holder or any
other Person, and irrespective of any other circumstance which might otherwise
limit such obligation of the Company to the Holder in connection with the
issuance of Additional Investment Right Shares. Nothing herein shall limit a
Holder's right to pursue any other remedies available to it hereunder, at law or
in equity including, without limitation, a decree of specific performance and/or
injunctive relief with respect to the Company's failure to timely deliver
certificates representing shares of Common Stock upon exercise of the Additional
Investment Right as required pursuant to the terms hereof.

   6. Charges, Taxes and Expenses. Issuance and delivery of certificates for
shares of Common Stock upon exercise of this Additional Investment Right shall
be made without charge to the Holder for any issue or transfer tax, withholding
tax, transfer agent fee or other incidental tax or expense in respect of the
issuance of such certificates, all of which taxes and expenses shall be paid by
the Company; provided, however, that the Company shall not be required to pay
any tax which may be payable in respect of any transfer involved in the
registration of any certificates for Additional Investment Right Shares or
Additional Investment Rights in a name other than that of the Holder or an
Affiliate thereof. The Holder shall be responsible for all other tax liability
that may arise as a result of holding or transferring this Additional Investment
Right or receiving Additional Investment Right Shares upon exercise hereof.

   7. Replacement of Additional Investment Right. If this Additional Investment
Right is mutilated, lost, stolen or destroyed, the Company shall issue or cause
to be issued in exchange and substitution for and upon cancellation hereof, or
in lieu of and substitution for this Additional Investment Right, a New
Additional Investment Right, but only upon receipt of evidence reasonably
satisfactory to the Company of such loss, theft or destruction and customary and
reasonable bond or indemnity, if requested. Applicants for a New Additional
Investment Right under such circumstances shall also comply with such other
reasonable regulations and procedures and pay such other reasonable third-party
costs as the Company may prescribe.

   8. Reservation of Additional Investment Right Shares. The Company covenants
that it will at all times reserve and keep available out of the aggregate of its
authorized but unissued and otherwise unreserved Common Stock, solely for the
purpose of enabling it to issue Additional Investment Right Shares upon exercise
of this Additional Investment Right as herein provided, the number of Additional
Investment Right Shares which are then issuable and deliverable upon the
exercise of this entire Additional Investment Right, free from preemptive rights
or any other contingent purchase rights of persons other than the Holder (after
giving effect to the adjustments and restrictions of Section 9, if any). The
Company covenants that all Additional Investment Right Shares so issuable and
deliverable shall, upon issuance and the payment of the applicable Exercise
Price in accordance with the terms hereof, be duly and validly authorized,
issued and fully paid and nonassessable. The Company will take all such action
as may be necessary to assure that such shares of Common Stock may be issued as
provided herein without violation of any applicable law or regulation, or of any
requirements of any securities exchange or automated quotation system upon which
the Common Stock may be listed.

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   9. Certain Adjustments. The Exercise Price and number of Additional
Investment Right Shares issuable upon exercise of this Additional Investment
Right are subject to adjustment from time to time as set forth in this Section
9.

(a) Stock Dividends and Splits. If the Company, at any time while this
Additional Investment Right is outstanding, (i) pays a stock dividend on its
Common Stock or otherwise makes a distribution on any class of capital stock
that is payable in shares of Common Stock, (ii) subdivides outstanding shares of
Common Stock into a larger number of shares, or (iii) combines outstanding
shares of Common Stock into a smaller number of shares, then in each such case
the Exercise Price shall be multiplied by a fraction of which the numerator
shall be the number of shares of Common Stock outstanding immediately before
such event and of which the denominator shall be the number of shares of Common
Stock outstanding immediately after such event. 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 clause (ii) or (iii) of this
paragraph shall become effective immediately after the effective date of such
subdivision or combination.

(b) Pro Rata Distributions. If the Company, at any time while this Additional
Investment Right is outstanding, distributes to holders of Common Stock (i)
evidences of its indebtedness, (ii) any security (other than a distribution of
Common Stock covered by the preceding paragraph), (iii) rights or warrants to
subscribe for or purchase any security, or (iv) any other asset (in each case,
"Distributed Property"), then in each such case the Exercise Price in effect
immediately prior to the record date fixed for determination of stockholders
entitled to receive such distribution shall be adjusted (effective on such
record date) to equal the product of such Exercise Price times a fraction of
which the denominator shall be the average of the Closing Prices for the five
Trading Days immediately prior to (but not including) such record date and of
which the numerator shall be such average less the then fair market value of the
Distributed Property distributed in respect of one outstanding share of Common
Stock, as determined by the Company's independent certified public accountants
that regularly examine the financial statements of the Company, (an
"Appraiser"). In such event, the Holder, after receipt of the determination by
the Appraiser, shall have the right to select an additional appraiser (which
shall be a nationally recognized accounting firm), in which case such fair
market value shall be deemed to equal the average of the values determined by
each of the Appraiser and such appraiser. As an alternative to the foregoing
adjustment to the Exercise Price, at the request of the Holder delivered before
the 90th day after such record date, the Company will deliver to such Holder,
within five Trading Days after such request (or, if later, on the effective date
of such distribution), the Distributed Property that such Holder would have been
entitled to receive in respect of the Additional Investment Right Shares for
which this Additional Investment Right could have been exercised immediately
prior to such record date. If such Distributed Property is not delivered to a
Holder pursuant to the preceding sentence, then upon expiration of or any
exercise of the Additional Investment Right that occurs after such record date,
such Holder shall remain entitled to receive, in addition to the Additional
Investment Right Shares otherwise issuable upon such exercise (if applicable),
such Distributed Property.

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(c) Fundamental Transactions. If, at any time while this Additional Investment
Right is outstanding, (i) the Company effects any merger or consolidation of the
Company with or into another Person, (ii) the Company effects any sale of all or
substantially all of its assets in one or a series of related transactions,
(iii) any tender offer or exchange offer (whether by the Company or another
Person) is completed pursuant to which holders of Common Stock are permitted to
tender or exchange their shares for other securities, cash or property, or (iv)
the Company effects any reclassification of the Common Stock or any compulsory
share exchange pursuant to which the Common Stock is effectively converted into
or exchanged for other securities, cash or property (other than as a result of a
subdivision or combination of shares of Common Stock covered by Section 9(a)
above) (in any such case, a "Fundamental Transaction"), then the Holder shall
have the right thereafter to receive, upon exercise of this Additional
Investment Right, the same amount and kind of securities, cash or property as it
would have been entitled to receive upon the occurrence of such Fundamental
Transaction if it had been, immediately prior to such Fundamental Transaction,
the holder of the number of Additional Investment Right Shares then issuable
upon exercise in full of this Additional Investment Right (the "Alternate
Consideration"). The aggregate Exercise Price for this Additional Investment
Right will not be affected by any such Fundamental Transaction, but the Company
shall apportion such aggregate Exercise Price among the Alternate Consideration
in a reasonable manner reflecting the relative value of any different components
of the Alternate Consideration. If holders of Common Stock are given any choice
as to the securities, cash or property to be received in a Fundamental
Transaction, then the Holder shall be given the same choice as to the Alternate
Consideration it receives upon any exercise of this Additional Investment Right
following such Fundamental Transaction. At the Holder's request, any successor
to the Company or surviving entity in such Fundamental Transaction shall issue
to the Holder a new Additional Investment Right consistent with the foregoing
provisions and evidencing the Holder's right to purchase the Alternate
Consideration for the aggregate Exercise Price upon exercise thereof. The terms
of any agreement pursuant to which a Fundamental Transaction is effected shall
include terms requiring any such successor or surviving entity to comply with
the provisions of this paragraph (c) and insuring that the Additional Investment
Right (or any such replacement security) will be similarly adjusted upon any
subsequent transaction analogous to a Fundamental Transaction. If any
Fundamental Transaction constitutes or results in a "going private" transaction
as defined in Rule 13e-3 under the Exchange Act, then the Company (or any such
successor or surviving entity) will redeem this Warrant from the Holder for a
purchase price, payable in cash on the closing date of such "going private"
transaction, equal to the Black Scholes value of the remaining unexercised
portion of this Warrant on the closing date of such "going private" transaction.

(d) Subsequent Equity Sales.

(i) If, at any time while this Additional Investment Right is outstanding, the
Company or any Subsidiary issues additional shares of Common Stock or rights,
Additional Investment Rights, options or other securities or debt convertible,
exercisable or exchangeable for shares of Common Stock or otherwise entitling
any Person to acquire shares of Common Stock (collectively, "Common Stock
Equivalents") at an effective net price to the Company per share of Common Stock
(the "Effective Price") less than the Exercise Price (as adjusted hereunder to
such date), then the Exercise Price shall be reduced to equal the Effective
Price. If, at any time while this Additional Investment Right is outstanding,
the Company or any Subsidiary issues Common Stock or Common Stock Equivalents at
an Effective Price greater than the Exercise Price (as adjusted hereunder to
such date) but less than the average Closing Price over the five Business Days
prior to such issuance (the "Adjustment Price"), then the Exercise Price shall
be reduced to equal the product of (A) the Exercise Price in effect immediately
prior to such issuance of Common Stock or Common Stock Equivalents times (B) a
fraction, the numerator of which is the sum of (1) the number of shares of
Common Stock outstanding immediately prior to such issuance, plus (2) the number
of shares of Common Stock which the aggregate Effective Price of the Common
Stock issued (or deemed to be issued) would purchase at the Adjustment Price,
and the denominator of which is the aggregate number of shares of Common Stock
outstanding or deemed to be outstanding immediately after such issuance. For
purposes of this paragraph, in connection with any issuance of any Common Stock
Equivalents, (A) the maximum number of shares of Common Stock potentially
issuable at any time upon conversion, exercise or exchange of such Common Stock
Equivalents (the "Deemed Number") shall be deemed to be outstanding upon
issuance of such Common Stock Equivalents, (B) the Effective Price applicable to
such Common Stock shall equal the minimum dollar value of consideration payable
to the Company to purchase such Common Stock Equivalents and to convert,
exercise or exchange them into Common Stock (net of any discounts, fees,
commissions and other expenses), divided by the Deemed Number, and (C) no
further adjustment shall be made to the Exercise Price upon the actual issuance
of Common Stock upon conversion, exercise or exchange of such Common Stock
Equivalents.

(ii) If, at any time while this Additional Investment Right is outstanding, the
Company or any Subsidiary issues Common Stock Equivalents with an Effective
Price or a number of underlying shares that floats or resets or otherwise varies
or is subject to adjustment based (directly or indirectly) on market prices of
the Common Stock (a "Floating Price Security"), then for purposes of applying
the preceding paragraph in connection with any subsequent exercise, the
Effective Price will be determined separately on each Exercise Date and will be
deemed to equal the lowest Effective Price at which any holder of such Floating
Price Security is entitled to acquire Common Stock on such Exercise Date
(regardless of whether any such holder actually acquires any shares on such
date).

(iii) Notwithstanding the foregoing, no adjustment will be made under this
paragraph (d) in respect to any Excluded Stock.

(e) Number of Additional Investment Right Shares. Simultaneously with any
adjustment to the Exercise Price pursuant to paragraphs (a) or (b) of this
Section, the number of Additional Investment Right Shares that may be purchased
upon exercise of this Additional Investment Right shall be increased or
decreased proportionately, so that after such adjustment the aggregate Exercise
Price payable hereunder for the increased or decreased number of Additional
Investment Right Shares shall be the same as the aggregate Exercise Price in
effect immediately prior to such adjustment.

(f) Calculations. All calculations under this Section 9 shall be made to the
nearest cent or the nearest 1/100th of a share, as applicable. The number of
shares of Common Stock outstanding at any given time shall not include shares
owned or held by or for the account of the Company, and the disposition of any
such shares shall be considered an issue or sale of Common Stock.

(g) Notice of Adjustments. Upon the occurrence of each adjustment pursuant to
this Section 9, the Company at its expense will promptly compute such adjustment
in accordance with the terms of this Additional Investment Right and prepare a
certificate setting forth such adjustment, including a statement of the adjusted
Exercise Price and adjusted number or type of Additional Investment Right Shares
or other securities issuable upon exercise of this Additional Investment Right
(as applicable), describing the transactions giving rise to such adjustments and
showing in detail the facts upon which such adjustment is based. Upon written
request, the Company will promptly deliver a copy of each such certificate to
the Holder and to the Company's Transfer Agent.

(h) Notice of Corporate Events. If the Company (i) declares a dividend or any
other distribution of cash, securities or other property in respect of its
Common Stock, including without limitation any granting of rights or warrants to
subscribe for or purchase any capital stock of the Company or any Subsidiary,
(ii) authorizes or approves, enters into any agreement contemplating or solicits
stockholder approval for any Fundamental Transaction or (iii) authorizes the
voluntary dissolution, liquidation or winding up of the affairs of the Company,
then the Company shall deliver to the Holder a notice describing the material
terms and conditions of such transaction, at least 20 calendar days prior to the
applicable record or effective date on which a Person would need to hold Common
Stock in order to participate in or vote with respect to such transaction, and
the Company will take all steps reasonably necessary in order to insure that the
Holder is given the practical opportunity to exercise this Additional Investment
Right prior to such time so as to participate in or vote with respect to such
transaction; provided, however, that the failure to deliver such notice or any
defect therein shall not affect the validity of the corporate action required to
be described in such notice.

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   10. Payment of Exercise Price. The Holder shall pay the Exercise Price in
immediately available funds; provided, however, if the Registration Statement
did not become effective on or before Required Effectiveness Date and is not
continuously effective through the Expiration Date, the Holder may satisfy its
obligation to pay the Exercise Price through a "cashless exercise," in which
event the Company shall issue to the Holder the number of Additional Investment
Right Shares determined as follows:

    X = Y [(A-B)/A]

where:    

    X = the number of Additional Investment Right Shares to be issued to the
Holder.     Y = the number of Additional Investment Right Shares with respect to
which this Additional Investment Right is being exercised.     A = the average
of the Closing Prices for the five Trading Days immediately prior to (but not
including) the Exercise Date.     B = the Exercise Price.

   For purposes of Rule 144 promulgated under the Securities Act, it is
intended, understood and acknowledged that the Additional Investment Right
Shares issued in a cashless exercise transaction shall be deemed to have been
acquired by the Holder, and the holding period for the Additional Investment
Right Shares shall be deemed to have commenced, on the date this Additional
Investment Right was originally issued pursuant to the Purchase Agreement.

11. Limitation on Exercise.

(a) Notwithstanding anything to the contrary contained herein, the number of
shares of Common Stock that may be acquired by the Holder upon any exercise of
this Additional Investment Right (or otherwise in respect hereof) shall be
limited to the extent necessary to insure that, following such exercise (or
other issuance), the total number of shares of Common Stock then beneficially
owned by such Holder and its Affiliates and any other Persons whose beneficial
ownership of Common Stock would be aggregated with the Holder's for purposes of
Section 13(d) of the Exchange Act, does not exceed 4.999% (the "Maximum
Percentage") of the total number of issued and outstanding shares of Common
Stock (including for such purpose the shares of Common Stock issuable upon such
exercise). For such purposes, beneficial ownership shall be determined in
accordance with Section 13(d) of the Exchange Act and the rules and regulations
promulgated thereunder. The Company's obligation to issue shares of Common Stock
in excess of the limitation referred to in this Section shall be suspended (and
shall not terminate or expire notwithstanding any contrary provisions hereof)
until such time, if any, as such shares of Common Stock may be issued in
compliance with such limitation, but in no event later than the Expiration Date.
Additionally, by written notice to the Company, the Holder may waive the
provisions of this Section 11 or increase or decrease the Maximum Percentage to
any other percentage specified in such notice, but (i) any such waiver or
increase will not be effective until the 61st day after such notice is delivered
to the Company, and (ii) any such waiver or increase or decrease will apply only
to the Holder and not to any other holder of Additional Investment Rights.

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(b) Notwithstanding anything to the contrary contained herein, if the Trading
Market is the NASDAQ National Market, or any other market or exchange with
similar applicable rules, then the maximum number of shares of Common Stock that
the Company may issue pursuant to the Transaction Documents at an effective
purchase price less than the Closing Price on the Trading Day immediately
preceding the Closing Date (or, if greater, the book value per share of Common
Stock calculated in accordance with the Company's most recently filed periodic
report with the Commission) equals 2,982,829 shares (the "Issuable Maximum"),
unless the Company obtains the necessary stockholder approvals required by the
rules and regulations of the Trading Market. If, at the time any Holder requests
an exercise of any of the Additional Investment Rights, the Actual Minimum
(excluding any shares issued or issuable at an effective purchase price in
excess of the Closing Price on the Trading Day immediately preceding the Closing
Date (or, if greater, the book value per share of Common Stock calculated in
accordance with the Company's most recently filed periodic report with the
Commission)) exceeds the Issuable Maximum (and if the Company has not previously
obtained the required stockholder approval), then the Company shall issue to the
Holder requesting such exercise a number of shares of Common Stock not exceeding
such Holder's pro rata portion of the Issuable Maximum (based on such Holder's
share (vis-a-vis other Holders) of the aggregate purchase price paid under the
Purchase Agreement and taking into account any Additional Investment Right
Shares previously issued to such Holder). For the purposes hereof, "Actual
Minimum" shall mean, as of any date, the maximum aggregate number of shares of
Common Stock then issued or potentially issuable in the future pursuant to the
Transaction Documents, including any Underlying Shares issuable upon exercise in
full of all Additional Investment Rights, without giving effect to any limits on
the number of shares of Common Stock that may be owned by a Holder at any one
time.

   12. Fractional Shares. The Company shall not be required to issue or cause to
be issued fractional Additional Investment Right Shares on the exercise of this
Additional Investment Right. If any fraction of a Additional Investment Right
Share would, except for the provisions of this Section, be issuable upon
exercise of this Additional Investment Right, the number of Additional
Investment Right Shares to be issued will be rounded up to the nearest whole
share.

   13. Notices. Any and all notices or other communications or deliveries
hereunder (including without limitation any Exercise Notice) shall be in writing
and shall be deemed given and effective on the earliest of (i) the date of
transmission, if such notice or communication is delivered via facsimile at the
facsimile number specified in this Section prior to 5:30 p.m. (New York City
time) on a Trading Day, (ii) the next Trading Day after the date of
transmission, if such notice or communication is delivered via facsimile at the
facsimile number specified in this Section on a day that is not a Trading Day or
later than 5:30 p.m. (New York City time) on any Trading Day, (iii) the Trading
Day following the date of mailing, if sent by nationally recognized overnight
courier service, or (iv) upon actual receipt by the party to whom such notice is
required to be given. The address for such notices or communications shall be as
set forth in the Purchase Agreement.

   14. Additional Investment Right Agent. The Company shall serve as Additional
Investment Right agent under this Additional Investment Right. Upon 30 days'
notice to the Holder, the Company may appoint a new Additional Investment Right
agent. Any corporation into which the Company or any new Additional Investment
Right agent may be merged or any corporation resulting from any consolidation to
which the Company or any new Additional Investment Right agent shall be a party
or any corporation to which the Company or any new Additional Investment Right
agent transfers substantially all of its corporate trust or stockholders
services business shall be a successor Additional Investment Right agent under
this Additional Investment Right without any further act. Any such successor
Additional Investment Right agent shall promptly cause notice of its succession
as Additional Investment Right agent to be mailed (by first class mail, postage
prepaid) to the Holder at the Holder's last address as shown on the Additional
Investment Right Register.

   15. Miscellaneous

(a) Subject to the restrictions on transfer set forth on the first page hereof,
this Additional Investment Right may be assigned by the Holder. This Additional
Investment Right may not be assigned by the Company except to a successor in the
event of a Fundamental Transaction. This Additional Investment Right shall be
binding on and inure to the benefit of the parties hereto and their respective
successors and assigns. Subject to the preceding sentence, nothing in this
Additional Investment Right shall be construed to give to any Person other than
the Company and the Holder any legal or equitable right, remedy or cause of
action under this Additional Investment Right. This Additional Investment Right
may be amended only in writing signed by the Company and the Holder and their
successors and assigns.

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(b) The Company will not, by amendment of its governing documents 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 Additional Investment
Right, but will at all times in good faith assist in the carrying out of all
such terms and in the taking of all such action as may be necessary or
appropriate in order to protect the rights of the Holder against impairment.
Without limiting the generality of the foregoing, the Company (i) will not
increase the par value of any Additional Investment Right Shares above the
amount payable therefor on such exercise, (ii) will take all such action as may
be reasonably necessary or appropriate in order that the Company may validly and
legally issue fully paid and nonassessable Additional Investment Right Shares on
the exercise of this Additional Investment Right, and (iii) will not close its
stockholder books or records in any manner which interferes with the timely
exercise of this Additional Investment Right.

(c) GOVERNING LAW; VENUE; WAIVER OF JURY TRIAL. ALL QUESTIONS CONCERNING THE
CONSTRUCTION, VALIDITY, ENFORCEMENT AND INTERPRETATION OF THIS ADDITIONAL
INVESTMENT RIGHT SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK. EACH PARTY HEREBY IRREVOCABLY SUBMITS TO
THE EXCLUSIVE JURISDICTION OF THE STATE AND FEDERAL COURTS SITTING IN THE CITY
OF NEW YORK, BOROUGH OF MANHATTAN, FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER
OR IN CONNECTION HEREWITH OR WITH ANY TRANSACTION CONTEMPLATED HEREBY OR
DISCUSSED HEREIN (INCLUDING WITH RESPECT TO THE ENFORCEMENT OF ANY OF THE
TRANSACTION DOCUMENTS), AND HEREBY IRREVOCABLY WAIVES, AND AGREES NOT TO ASSERT
IN ANY SUIT, ACTION OR PROCEEDING, ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT
TO THE JURISDICTION OF ANY SUCH COURT, THAT SUCH SUIT, ACTION OR PROCEEDING IS
IMPROPER. EACH PARTY HEREBY IRREVOCABLY WAIVES PERSONAL SERVICE OF PROCESS AND
CONSENTS TO PROCESS BEING SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING BY
MAILING A COPY THEREOF VIA REGISTERED OR CERTIFIED MAIL OR OVERNIGHT DELIVERY
(WITH EVIDENCE OF DELIVERY) TO SUCH PARTY AT THE ADDRESS IN EFFECT FOR NOTICES
TO IT UNDER THIS AGREEMENT AND AGREES THAT SUCH SERVICE SHALL CONSTITUTE GOOD
AND SUFFICIENT SERVICE OF PROCESS AND NOTICE THEREOF. NOTHING CONTAINED HEREIN
SHALL BE DEEMED TO LIMIT IN ANY WAY ANY RIGHT TO SERVE PROCESS IN ANY MANNER
PERMITTED BY LAW. THE COMPANY HEREBY WAIVES ALL RIGHTS TO A TRIAL BY JURY.

(d) The headings herein are for convenience only, do not constitute a part of
this Additional Investment Right and shall not be deemed to limit or affect any
of the provisions hereof.

(e) In case any one or more of the provisions of this Additional Investment
Right shall be invalid or unenforceable in any respect, the validity and
enforceability of the remaining terms and provisions of this Additional
Investment Right shall not in any way be affected or impaired thereby and the
parties will attempt in good faith to agree upon a valid and enforceable
provision which shall be a commercially reasonable substitute therefor, and upon
so agreeing, shall incorporate such substitute provision in this Additional
Investment Right.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK,

SIGNATURE PAGE FOLLOWS]

 

               

9  /  STKR
  
2004 Form 8-K

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, the Company has caused this Additional Investment Right to
be duly executed by its authorized officer as of the date first indicated above.

STOCKERYALE, INC.   By: _______________________________________ Name:
____________________________________ Title:
______________________________________

  

 

  

 

[SIGNATURE PAGES TO FOLLOW]

10  /  STKR
  
2004 Form 8-K

--------------------------------------------------------------------------------

FORM OF EXERCISE NOTICE

(To be executed by the Holder to exercise the right to purchase shares of Common
Stock under the foregoing Additional Investment Right)

To:  STOCKERYALE, INC.

The undersigned is the Holder of Additional Investment Right No. _______ (the
"Additional Investment Right") issued by StockerYale, Inc., a Delaware
corporation (the "b"). Capitalized terms used herein and not otherwise defined
have the respective meanings set forth in the Additional Investment Right.

1. The Additional Investment Right is currently exercisable to purchase a total
of ______________ Additional Investment Right Shares.

2. The undersigned Holder hereby exercises its right to purchase
_________________ Additional Investment Right Shares pursuant to the Additional
Investment Right.

3. The Holder intends that payment of the Exercise Price shall be made as (check
one):

____ "Cash Exercise" under Section 10

____ "Cashless Exercise" under Section 10

4. If the holder has elected a Cash Exercise, the holder shall pay the sum of
$____________ to the Company in accordance with the terms of the Additional
Investment Right.

5. Pursuant to this exercise, the Company shall deliver to the holder
_______________ Additional Investment Right Shares in accordance with the terms
of the Additional Investment Right.

6. Following this exercise, the Additional Investment Right shall be exercisable
to purchase a total of ______________ Additional Investment Right Shares. 

      Dated: ________________________, _______   Name of Holder:
______________________________________           (Print)
______________________________________________           By:
________________________________________________     Name:
_____________________________________________     Title:
_______________________________________________           (Signature must
conform in all respects to name of holder as specified on the face of the
Additional Investment Right)      

11  /  STKR
  
2004 Form 8-K

--------------------------------------------------------------------------------

           

FORM OF ASSIGNMENT

[To be completed and signed only upon transfer of Additional Investment Right]

   FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
________________________________ the right represented by the within Additional
Investment Right to purchase ____________ shares of Common Stock of StockerYale,
Inc. to which the within Additional Investment Right relates and appoints
________________ attorney to transfer said right on the books of StockerYale,
Inc. with full power of substitution in the premises.

      Dated: ___________________, ______   Signature:
________________________________           (Signature must conform in all
respects to name of holder as specified on the face of the Additional Investment
Right)           Street: ___________________________________     Street 2:
_________________________________     City: ____________________________________
    State: ___________________________________     Zip/Postal Code:
__________________________     Country: _________________________________      
In the presence of:     _______________________________________    

 

Exhibit B   /  STKR
END
2004 Form 8-K