EXHIBIT 10.68





                                  AGREEMENT II

                                     BETWEEN

                                  BIOJECT, INC.

                                       AND

                                ANGIOSENSE, INC.

                            DATED SEPTEMBER 21, 1999




***  Confidential  portions  have been omitted  pursuant to an  application  for
     confidential  treatment under Rule 24b-2 under the Securities  Exchange Act
     of 1934, as amended.  Omitted  portions have been separately filed with the
     Securities and Exchange Commission.

<PAGE>




                                TABLE OF CONTENTS

<TABLE>
                                                                                                                   Page
<S>     <C>                                                                                                          <C>
ARTICLE 1 - DEFINITIONS...............................................................................................1


ARTICLE 2 - JOINT DEVELOPMENT COMMITTEE...............................................................................4
         2.1      Establishment of Joint Development Committee........................................................4
         2.2      Joint Development Committee Meetings................................................................5
         2.3      Enumerated Functions................................................................................5
         2.4      Decision Making.....................................................................................6

ARTICLE 3 - AJECT AND ANGIOSENSE PRODUCT DEVELOPMENT..................................................................6
         3.1      Project Overview....................................................................................6
         3.2      Aject Development...................................................................................6
         3.3      AngioSense Product Development......................................................................7
         3.4      Development Costs...................................................................................8
         3.5      Reports  9
         3.6      Records  9
         3.7      Capital Equipment...................................................................................9

ARTICLE 4 - EQUIPMENT.................................................................................................9
         4.1      Use of Equipment....................................................................................9
         4.2      Repair and Maintenance.............................................................................10
         4.3      Insurance..........................................................................................10
         4.4      Replacement........................................................................................10
         4.5      Ownership..........................................................................................10
         4.6      Location 11
         4.7      Documents..........................................................................................11
         4.8      Right of First Refusal.............................................................................11

ARTICLE 5 - CLINICAL DEVELOPMENT.....................................................................................11
         5.1      Clinical 11
         5.2      Detail   11
         5.3      Regulatory Filings.................................................................................11

ARTICLE 6 - EQUITY...................................................................................................12
         6.1      Equity.............................................................................................12

ARTICLE 7 - GRANT OF RIGHTS..........................................................................................12
         7.1      License Grant......................................................................................12
         7.2      Right of First Refusal in the Extended Field.......................................................12
         7.3      Prohibition on Reverse Engineering.................................................................12

</TABLE>



                                       i

<PAGE>
                                                 TABLE OF CONTENTS
                                                    (continued)


<TABLE>
<S>     <C>                                                                                                          <C>
ARTICLE 8 - SUPPLY OF THE AJECT......................................................................................12
         8.1      Terms and Conditions...............................................................................12
         8.2      Product Supply and Purchase........................................................................13
         8.3      Minimum Purchase Requirements......................................................................13
         8.4      Forecasts..........................................................................................13
         8.5      Orders   13
         8.6      Delivery 13
         8.7      Invoicing..........................................................................................14
         8.8      Shipping 15
         8.9      Product Acceptance.................................................................................15
         8.10     Return of Product..................................................................................15

ARTICLE 9 - TRANSFER PRICING; ROYALTIES; PAYMENTS; BOOKS AND RECORDS.................................................15
         9.1      Transfer Pricing...................................................................................15
         9.2      Inventory..........................................................................................16
         9.3      Royalty  16
         9.4      Sublicense Fees....................................................................................16
         9.5      Third Party Royalties..............................................................................17
         9.6      Records; Inspection................................................................................17

ARTICLE 10 - COMMERCIALIZATION.......................................................................................17
         10.1     Technical Literature...............................................................................17
         10.2     Product Packaging and Labeling.....................................................................17

ARTICLE 11 - PRODUCT WARRANTY........................................................................................18
         11.1     Product Warranty...................................................................................18

ARTICLE 12 - INTELLECTUAL PROPERTY...................................................................................18
         12.1     Bioject Field and AngioSense Field.................................................................18
         12.2     Joint Inventions...................................................................................18
         12.3     Joint Rights.......................................................................................19
         12.4     Sole Inventivons...................................................................................19
         12.5     Patent Prosecution.................................................................................20
         12.6     Improvements.......................................................................................20
         12.7     Defense of Third Party Infringement Claims.........................................................20
         12.8     Enforcement........................................................................................20

ARTICLE 13 - REPRESENTATIONS AND WARRANTIES..........................................................................21
         13.1     Bioject Warranties.................................................................................21
         13.2     AngioSense Warranties..............................................................................21

</TABLE>



                                       ii
<PAGE>
                                                 TABLE OF CONTENTS
                                                    (continued)

<TABLE>
<S>     <C>                                                                                                          <C>
ARTICLE 14 - CONFIDENTIALITY.........................................................................................22
         14.1     Confidential Information...........................................................................22
         14.2     Permitted Disclosures..............................................................................22

ARTICLE 15 - INDEMNIFICATION.........................................................................................22
         15.1     Indemnification of Bioject.........................................................................22
         15.2     Indemnification of AngioSense......................................................................23
         15.3     Procedure..........................................................................................23

ARTICLE 16 - TERM AND TERMINATION....................................................................................23
         16.1     Term     ..........................................................................................23
         16.2     Termination for Cause..............................................................................23
         16.3     Bankruptcy Proceedings.............................................................................23
         16.4     Effect of Expiration and Termination...............................................................24
         16.5     Survival 25

ARTICLE 17 - LIMITATION OF LIABILITY.................................................................................25

ARTICLE 18 - MISCELLANEOUS...........................................................................................25
         18.1     Governing Law......................................................................................25
         18.2     Disputes 25
         18.3     Force Majeure......................................................................................26
         18.4     No Implied Waivers; Rights Cumulative..............................................................26
         18.5     Independent Contractors............................................................................26
         18.6     Notices  26
         18.7     Assignment.........................................................................................27
         18.8     Visiting Personnel.................................................................................27
         18.9     Modification.......................................................................................27
         18.10    Severability.......................................................................................27
         18.11    Publicity..........................................................................................27
         18.12    Headings 27
         18.13    No Implied Licenses................................................................................27
         18.14    Entire Agreement...................................................................................28
         18.15    Counterparts.......................................................................................28
</TABLE>





                                      iii
<PAGE>


                                  AGREEMENT II

                                     BETWEEN

                                  BIOJECT, INC.

                                       AND

                                ANGIOSENSE, INC.

                            DATED SEPTEMBER 21, 1999





<PAGE>


                                  AGREEMENT II


     This Development and Supply Agreement ( "Agreement II") is made and entered
into this day of August 1999 (the "Effective Date"), by and between  AngioSense,
Inc.,  a  Delaware  corporation  ("AngioSense")  and  Bioject,  Inc.,  an Oregon
corporation ("Bioject").

                                   BACKGROUND

     A. Bioject has  developed  several  technologies  and  products  related to
needle-free,  jet injection drug delivery systems and is developing the "Iject",
a disposable needle-free jet injection drug delivery system; and

     B. AngioSense has developed certain  intellectual  property relating to the
surgical and percutaneous delivery of drugs; and

     C.  Bioject  and  AngioSense   desire  that  AngioSense  fund  the  further
development  and   customization   of  the  "Iject"  for  use  in  surgical  and
percutaneous  procedures  and perform  clinical  development  activities  in the
"Field" (as defined below) with respect to the "AngioSense Product"; and

     D. AngioSense desires to obtain an exclusive license from Bioject under the
Licensed  Patents  and  relating  to  the  Licensed  Technology,  together  with
associated  know-how  relevant to such  license,  to use and sell the "Aject" in
accordance  with the terms and  conditions  contained  herein and, under certain
conditions as specified herein and

     E. Bioject is willing to grant such an exclusive  license to  AngioSense in
accordance with the terms and conditions contained herein;

     NOW THEREFORE, for and in consideration of the covenants,  conditions,  and
undertakings  hereinafter  set forth, it is agreed by and between the parties as
follows:

                                   ARTICLE 1
                                   DEFINITIONS

     1.1 "Affiliate"  shall mean any entity which controls,  is controlled by or
is under common control with AngioSense or Bioject.  An entity shall be regarded
as in control of another  entity for  purposes of this Section 1.1 if it owns or
controls  more than  fifty  percent  (50%) of the shares of the  subject  entity
entitled to vote in the election of directors (or, in the case of an entity that
is not a corporation, for the election of the corresponding managing authority).

     1.2 "Aject"  shall mean a customized  version of the current  Iject device.
The Aject will be a single use,  disposable,  pre-fillable  jet injection  power
source. The Aject will be customized to


<PAGE>

the "Aject  Specifications"  by Bioject  and  incorporated  into the  AngioSense
Product (as defined below)

     1.3 "Aject  Development" shall mean the customization of the Iject into the
Aject.

     1.4 "Aject Development Budget" shall mean the estimate of costs to complete
the "Aject Development Plan".

     1.5  "Aject  Development  Costs"  shall  mean  the  budgeted   expenditures
according to the approved Aject Development  Budget and subject to the terms and
conditions stated in Section 3.4 of this Agreement II.

     1.6  "Aject  Development  Plan"  shall  mean a  reasonably  detailed  plan,
specifying both development  objectives and work plan activities to be performed
by each of the parties for the  customization  and development of the Iject into
the Aject, in accordance with the Aject Specifications

     1.7   "Aject   Specifications"   shall   mean  the   design,   performance,
manufacturing,   quality,   sterilization,   labeling,   packaging   and  supply
requirements for the Aject.

     1.8  "AngioSense  Product"  shall  mean the  Aject in  combination  with an
AngioSense  catheter.

     1.9 "AngioSense  Product  Development Plan" shall mean reasonably  detailed
plans,  specifying  both  development  objectives and work plan activities to be
performed  by  each  of the  parties,  both  initially  and on an  annual  basis
thereafter,   through  which  the  AngioSense  Product  will  be  developed  and
commercialized.

     1.10 "Change of Control" shall means,  with respect to any entity,  (1) any
transaction or series of related  transactions,  other than a registered  public
offering  unrelated to any acquisition,  as a result of which the persons owning
the outstanding  voting  securities of Bioject,  Inc,  immediately prior to such
transaction  or series of related  transactions,  cease to own a majority of the
outstanding voting securities of the entity thereafter; (2) the consolidation or
merger of the entity with or into another  person or entity,  whether or not the
entity is the surviving entity of such  transaction,  unless  immediately  after
such  consolidation  or  merger,  the  persons  owning  the  outstanding  voting
securities the entity prior to the transaction own a majority of the outstanding
voting securities of such new or surviving  entity; or (3) the sale,  assignment
or other transfer of all or  substantially  all of the business or assets of the
entity  to  a  third  party  in  a  single  transaction  or  series  of  related
transactions.

     1.11 "Clinical Development" shall mean those preclinical studies (excluding
those  preclinical  studies to be  completed  by Bioject  pursuant  to the Aject
Development Plan),  clinical trials and all other activities reasonably required
to obtain and maintain all governmental  approvals  required to market the Aject
and the AngioSense Product for use within the Field.



                                      -2-
<PAGE>

     1.12  "Combination  Product"  shall mean any product that is developed  and
sold by AngioSense  and is comprised in part of one or more Ajects and/or one or
more  AngioSense  Products and of one or more other products or service or parts
which could be sold separately.

     1.13  "Confidential  Information"  shall  have the  meaning as set forth in
Section 14.1 below.

     1.14  "Control"  shall  mean  with  respect  to a  particular  intellectual
property  right or other  subject  matter,  possession of the ability to grant a
license or sublicense under such rights as provided for herein without violating
the terms of any agreement or other arrangements with any third party.

     1.15 "Extended Field" shall mean the use of the cardiovascular  system as a
delivery pathway for the treatment or diagnosis of a  non-cardiovascular  system
or environment, excluding injection through or within the skin.

     1.16  "Facility"  shall  mean  Bioject's  facility  located  at  7620  S.W.
Bridgeport Road, Portland, Oregon.

     1.17 "FDA" shall mean the United States Food and Drug Administration.

     1.18 "Field" shall mean all cardiovascular  procedures to treat or diagnose
cardiac or cardiovascular diseases,  including,  without limitation percutaneous
and surgical procedures.

     1.19 "Iject" shall mean a disposable jet injector as specified by the Iject
Specifications.  The parties  contemplate  that the Iject shall be the  surgical
handpiece and power source for the AngioSense Product.

     1.20  "Iject  Specifications"  shall  mean  the  engineering  requirements,
drawings  and   performance   criteria   requisite  for  determining  the  Aject
Specifications.

     1.21 "Improvements" shall mean those rights and other subject matter, made,
conceived  or reduced to practice  by either  party,  alone or jointly  with the
other party or a third party  subcontractor  comprised  of  improvements  to the
Licensed  Technology  which  are  reasonably  related  to the Aject  and/or  the
AngioSense Product.

     1.22 "Joint Development  Committee" shall have the meaning set forth in the
provisions of Article 2 below.

     1.23  "Licensed  Patents"  means (a) the  patents  and patent  applications
listed on Exhibit A attached hereto, (b) any and all related foreign patents and
patent   applications,   whether  now  existing  or  hereafter  filed,  (c)  any
provisionals,  substitutions,  divisionals,  reissues, renewals,  continuations,
continuations-in-part,   substitute  applications  and  inventors'  certificates
arising  from,  or  based  upon,   any  of  the  foregoing   patents  or  patent
applications,  and (d) any  patents  issuing  from any of the  foregoing  patent
applications.



                                      -3-
<PAGE>

     1.24 "Licensed  Technology"  shall mean the Licensed  Patents and Technical
Information.

     1.25 "Marketing  Approval  Application"  shall mean any application  with a
governmental  regulatory agency for authority to market the Aject and AngioSense
Product,  including without  limitation,  a premarketing  approval  application,
import  approval  application,  import  license  application,  or other  similar
application or filing.

     1.26 "Net Sales"  shall mean the total amount  charged to third  parties by
AngioSense,  its Affiliates or Sublicensees,  upon the sales of the Aject and/or
the AngioSense Product,  less the following  reasonable and customary deductions
to the extent  applicable  to such  allowed to the buyer  against  such  charged
amounts: (i) trade, quantity and cash discounts; (ii) rebates and chargebacks to
the buyer; (iii) reasonable amounts for actual uncollectible accounts determined
in accordance with generally acceptable accounting practices (GAAP) consistently
applied to all products of the selling party;  (iv) sales and value-added  taxes
imposed upon the in-country sale of the Aject and/or the AngioSense Product; (v)
transportation  charges,  including shipping  insurance;  and (vi) uncollectible
amounts.  For the  removal  of doubt,  Net  Sales  shall  not  include  sales by
AngioSense  to its  Affiliates  or  Sublicensees  for resale,  provided  that if
AngioSense  sells the Aject  and/or the  AngioSense  Product to an  Affiliate or
Sublicensee  for  resale,  Net Sales shall  include the amounts  charged by such
Affiliate or  Sublicensee to third parties on the resale of the Aject and/or the
AngioSense  Product.  With respect to Combination  Products,  Net Sales shall be
determined by multiplying  the amounts  received by AngioSense  attributable  to
Combination  Products by a fraction,  the  numerator of which is the fair market
value of the Aject and/or  AngioSense  Product,  as applicable,  included in the
Combination  Product, and the denominator of which is the sum of the fair market
value of such Aject or AngioSenses  product, as applicable,  and the fair market
value of the  products  or parts which are not the Aject  and/or the  AngioSense
Product. Whenever possible, the fair market value of the Aject or the AngioSense
Product  included in the  Combination  Product will be the market price at which
such Aject and/or AngioSense  Product,  as applicable,  is sold on a stand alone
basis;  provided  that fair market value shall be determined  reasonably  and in
good  faith by  AngioSense  and  Bioject  in the event  that no market  price is
available.

     1.27  "Sublicensee"  shall  mean a third  party  who has  obtained  through
AngioSense, a sublicense to the rights granted to AngioSense hereunder.

     1.28  "Technical  Information"  means all know-how,  data,  trade  secrets,
processes,  procedures,  devices, methods, formulas, materials,  compositions of
matter, protocols,  information or other subject matter within the knowledge and
possession of Bioject,  which is useful to or contributes in whole or in part to
the  practice of the Aject  and/or the  AngioSense  Product  and/or the Licensed
Patents in the Field.

     1.29 "Valid  Claim"  shall mean a claim of an issued and  unexpired  patent
which claim has not lapsed, been cancelled,  or become abandoned and which claim
has not been declared  invalid by a court of competent  jurisdiction,  and which
has  not  been  admitted  to  be  invalid  or  unenforceable  through  issue  or
disclaimer.



                                      -4-
<PAGE>

                                    ARTICLE 2
                          JOINT DEVELOPMENT COMMITTEE.

     2.1  Establishment of Joint Development  Committee.  AngioSense and Bioject
shall establish a Joint Development  Committee ("Joint  Development  Committee")
comprised of three (3)  representatives,  to be determined  later,  from each of
AngioSense  and  Bioject.  Bioject  and  AngioSense  each may  replace its Joint
Development Committee  representatives at any time, with prior written notice to
the other party.

     2.2 Joint Development  Committee Meetings.  The Joint Development Committee
shall meet in person at least  monthly  during the term of the  Agreement II, at
such locations as the parties agree,  and meet more frequently by other means as
dictated by the issues  surrounding the  implementation  of the Agreement II. At
its meetings,  the Joint Development Committee will monitor,  review and discuss
the  AngioSense  Product  Development  Plan  and  the  Aject  Development  Plan,
coordinate  the  exchange  of  information  between the  parties  regarding  the
commercialization,  marketing and sale of the Aject and the AngioSense  Products
in the Field and to undertake  and/or approve such other matters as are provided
for the Joint Development Committee under this Agreement II. With the consent of
Bioject and  AngioSense,  other  representatives  of Bioject or  AngioSense  may
attend Joint  Development  Committee  meetings as  non-voting  observers.  Joint
Development    Committee    meetings    shall   be   chaired   on    alternating
(meeting-by-meeting   basis)  by  the  lead   representative   from  Bioject  or
AngioSense,  as appropriate,  with AngioSense's lead representative chairing the
first meeting.  The  chairperson  shall be responsible for preparing the meeting
agendas and minutes.  Such minutes shall be deemed accepted and effective unless
an authorized  representative of a party has objected to the same within fifteen
(15) days of such party's first  receipt of such minutes.  Each party shall bear
its own  personnel and travel costs and expenses  relating to Joint  Development
Committee meetings.

     2.3 Enumerated Functions.  Without limiting Section 2.2 above, the function
of the Joint Development Committee shall include:

          2.3.1 Reviewing and modifying,  as needed,  the Aject Development Plan
and the AngioSense Product  Development Plan,  provided that i) any modification
to Bioject's  responsibilities  thereunder  shall be  reasonably  acceptable  to
Bioject;  ii)  Bioject's  portion  of the  development  budget  related  to such
modification  shall be  modified to reflect  any cost  increase  created by such
modification;   and  iii)  any  modification  to  AngioSense's  responsibilities
thereunder shall be reasonably acceptable to AngioSense;

          2.3.2 Reviewing Bioject's and AngioSense's performance,  respectively,
in the course of the Aject Development and the AngioSense Product Development in
accordance  with  the  Aject   Development  Plan  and  the  AngioSense   Product
Development Plan, respectively;

          2.3.3  Reviewing  all  Clinical  Development   (including  design  and
implementation of any clinical trials) and regulatory  efforts within the Field;




                                      -5-
<PAGE>

     2.3.4 Reviewing Aject  Development  Milestones,  as described in Exhibit C,
and assessing Bioject's achievement of such Aject Development Milestones;

     2.3.5  Considering  and  mediating  any points of  disagreement  or dispute
between the parties; and

     2.3.6 With respect to improvements to the Licensed Technology,  determining
whether  such  improvements  are  reasonably  related  to the Aject  and/or  the
AngioSense  Product  so as to fall  within the  definition  of  Improvements  as
defined in Section 1.21 of this Agreement II.

     2.4 Decision Making.  Decisions of the Joint Development Committee shall be
made by majority approval (i.e., by a majority of the total number of authorized
representatives on the Joint Development Committee,  whether or not present at a
particular meeting In the case of disagreements and disputes between the parties
where the JDC is unable to resolve, the provisions of section 18.2 shall apply.

                                   ARTICLE 3
                    AJECT AND ANGIOSENSE PRODUCT DEVELOPMENT

     3.1  Project  Overview.  The  table  below is an  overview  of the  various
projects  referenced by this Agreement II, the tasks  associated  with each such
project, the task completion dates, and the party responsible for each task.

<TABLE>
           PROJECT                        TASK                      RESPONSIBILITY                   TIMING
------------------------------- ---------------------------- ---------------------------- ----------------------------
<S>                             <C>                          <C>                          <C>
Iject                           Iject Spec. delivered to     Bioject                      ***
                                AngioSense

Aject                           Aject Spec.                  AngioSense                   ***

Aject                           Aject Dev. Plan              JDC                          ***

Aject                           Aject Budget                 JDC                          ***

Aject                           Aject Development            AngioSense & Bioject         ***
                                                             (monitored by the JDC)

AngioSense Product              AngioSense Product           AngioSense                   ***
                                Development Plan

AngioSense Product              AngioSense Product Budget    JDC                          ***

AngioSense Product              AngioSense Product           AngioSense & Bioject         ***
                                Development                  (monitored by the JDC)       ***
</TABLE>


     3.2 Aject  Development.  The Aject  Development  comprises the creation and
implementation of the product  specifications,  development plan, clinical plan,
and associated





                                      -6-
<PAGE>


development  budget  necessary for  customizing  the Iject,  as defined above in
Section  1.19,  into  the  Aject,  as  defined  above  in  Section  1.2,  to  be
incorporated into the AngioSense Product, as defined above in Section 1.8.

     3.2.1 Aject Specifications. The parties agree that, in order for AngioSense
to reasonably define the Aject Specification, AngioSense will need to understand
and have reference to the Iject Specification.  Accordingly,  within *** (***)
*** of the Effective Date ("T1"), Bioject shall deliver to AngioSense a copy of
the Iject  Specification,  in its then current form,  and any drawings and other
materials  that Bioject  deems  relevant or necessary to the  definition  of the
Aject Specification.  Within *** (***) *** of T1 ("T2"), AngioSense shall have
completed  and  delivered  to  the  Joint  Development   Committee,   the  Aject
Specifications in a commercially reasonable form.

     3.2.2 Aject  Development  Plan. The Joint  Development  Committee  shall be
responsible  for defining and preparing an Aject  Development  Plan based on the
Aject  Specification.  Within *** (***) ***of T2 ("T3"),  the Joint  Development
Committee  shall  prepare and complete  the Aject  Development  Plan.  The Aject
Development Plan shall define the development  activities,  responsibilities  of
the parties, and the timeline according to which the development of the Aject is
to be carried out. Such Aject  Development Plan shall be fixed until the *** ***
of T3, unless otherwise determined by the Joint Development Committee.  For each
subsequent year  thereafter,  the Joint  Development  Committee shall revise the
Aject  Development  Plan.  Each such annual  revision shall be made at least ***
(***) *** prior to ***. Bioject's development  activities,  responsibilities and
related   timelines  under  the  Aject  Development  Plan  shall  be  reasonably
acceptable to Bioject. AngioSense's development activities, responsibilities and
related   timelines  under  the  Aject  Development  Plan  shall  be  reasonably
acceptable to AngioSense.

     3.2.3  Aject  Development  Budget.  Within *** (***) *** of T3 ("T4"),  the
Joint  Development  Committee  shall  prepare and complete an Aject  Development
Budget associated with the Aject Development Plan. The Aject Development  Budget
shall be in standard  accounting format,  itemizing the Aject Development Costs.
Such  Aject  Development  Budget  shall  be  fixed  for as  long  as  the  Aject
Development Plan remains fixed, and shall be revised  according to the revisions
made to the Aject  Development  Plan,  unless otherwise  determined by the Joint
Development  Committee.  The portion of the Aject Development  Budget related to
Bioject's  activities  under  the Aject  Development  Plan  shall be  reasonably
acceptable to Bioject.  The portion of the Aject  Development  Budget related to
AngioSense's  activities  under the Aject  Development  Plan shall be reasonably
acceptable to AngioSense.

     3.2.4 Aject  Development.  Bioject and AngioSense,  respectively,  shall be
responsible for implementing,  directly or through third parties,  such portions
of the Aject  Development  Plan for which  each is  responsible,  and do such in
accordance  with the time schedules  defined  therein and in accordance with the
Aject Development  Budget.  The Aject Development shall be overseen by the Joint
Development Committee, and each party shall keep the Joint Development Committee
reasonably informed as to its progress under the Aject Development Plan. Without



                                      -7-
<PAGE>

limiting the  foregoing,  the parties  agree to initiate  implementation  of the
Aject  Development Plan promptly after approval of such by the Joint Development
Committee.

     3.3 AngioSense  Product  Development.  The AngioSense  Product  Development
comprises  the  creation  and  implementation  of  the  product  specifications,
development plan, clinical plan and associated  development budget necessary for
the  commercialization  of the AngioSense  Product,  as defined above in Section
1.8.  The  parties  agree  that,  at  least  in part,  such  AngioSense  Product
Development  is necessarily  dependent  upon the  successful  progression of the
Aject Product Development as defined in Section 3.1 of this Agreement II.

     3.3.1 AngioSense Product  Development Plan.  Accordingly,  within *** (***)
*** of T3,  i.e.,  T4 (T3 being  defined  above as the date upon which the Aject
Development  Plan is to be  completed),  AngioSense  shall  deliver a  completed
AngioSense  Product  Development Plan to the Joint  Development  Committee.  The
AngioSense  Product  Development  Plan shall define the development  activities,
responsibilities  of the  parties,  and the  timeline  according  to  which  the
development of the AngioSense Product is to be carried out. Upon approval of the
AngioSense Product  Development Plan, such AngioSense  Product  Development Plan
shall be  fixed  until  *** of T4,  unless  otherwise  determined  by the  Joint
Development  Committee.  For each subsequent year  thereafter,  AngioSense shall
revise the AngioSense Product Development Plan for submission to and approval by
the Joint  Development  Committee.  Each such annual  revision  shall be made at
least  ***  (***)  ***   prior  to  ***.   Bioject's   development   activities,
responsibilities  and related timelines under the AngioSense Product Development
Plan  shall  be  reasonably  acceptable  to  Bioject.  AngioSense's  development
activities,  responsibilities and related timelines under the AngioSense Product
Development Plan shall be reasonably acceptable to AngioSense.

     3.3.2 AngioSense  Product  Development  Budget.  Within *** (***) *** of T4
("T5"), the Joint Development Committee shall prepare and complete an AngioSense
Product  Development Budget associated with the AngioSense  Product  Development
Plan. The AngioSense Product  Development Budget shall be in standard accounting
format,  itemizing the AngioSense  Product  Development  Costs.  Such AngioSense
Product  Development Budget shall be fixed for as long as the AngioSense Product
Development Plan remains fixed, and shall be revised  according to the revisions
made to the AngioSense Product Development Plan, unless otherwise  determined by
the  Joint  Development  Committee.   The  portion  of  the  AngioSense  Product
Development Budget related to Bioject's  activities under the AngioSense Product
Development Plan shall be reasonably  acceptable to Bioject.  The portion of the
AngioSense Product  Development Budget related to AngioSense's  activities under
the  AngioSense  Product  Development  Plan shall be  reasonably  acceptable  to
AngioSense.

     3.3.3 AngioSense Product Development. Bioject and AngioSense, respectively,
shall be responsible for implementing,  directly or through third parties,  such
portions  of  the  AngioSense  Product   Development  Plan  for  which  each  is
responsible,  and do such in accordance with the time schedules  defined therein
and in accordance with the AngioSense Product



                                      -8-
<PAGE>

Development  Budget. The AngioSense Product Development shall be overseen by the
Joint  Development  Committee,  and each party shall keep the Joint  Development
Committee  reasonably  informed as to its progress under the AngioSense  Product
Development Plan. Without limiting the foregoing,  the parties agree to initiate
implementation  of  the  AngioSense  Product  Development  Plan  promptly  after
approval of such by the Joint  Development  Committee.

     3.4 Development  Costs.  AngioSense shall pay to Bioject Aject  Development
Costs and AngioSense Product Development Costs  (collectively  "Costs") incurred
by Bioject pursuant to the Aject Development  Budget and the AngioSense  Product
Development   Budget  or  any  revisions  thereto   (collectively,   "Budgets"),
respectively; provided however, AngioSense shall not be obligated to pay Bioject
for any Costs over any Budget,  unless such Costs are approved in writing by the
Joint  Development  Committee in advance of incurment of such Costs.  Such Costs
shall be payable and due *** (***) *** in advance in an amount  equal to the ***
for each such *** (***) *** period  according to the respective  Budget to which
such payment is related. The initial payment in each case shall be due upon ***.

     3.5 Reports.  Within a reasonable period after each relevant calendar month
during  the term of this  Agreement  II,  each party  shall  submit to the Joint
Development  Committee  by  e-mail,  or such  other  manner as the  parties  may
mutually agree upon, a written summary of each party's progress and the specific
activities  performed  by  it  under  the  Aject  Development  Plan  and/or  the
AngioSense  Product  Development  Plan during the previous  calendar month.

     3.6 Records. Bioject shall complete true and accurate books of accounts and
records of the Aject Development Costs and AngioSense Product  Development Costs
incurred for the Aject Development and AngioSense Product Development hereunder.
Such books and  records  shall be kept by Bioject  for at least  three (3) years
following  each  year to  which  they  pertain.  Such  records  will be open for
inspection  during such three  (3)-year  period,  but no later than one (1) year
after completion of the Aject  Development and AngioSense  Product  Development,
respectively,  hereunder,  by an  independent  auditor  chosen by AngioSense and
reasonably  acceptable  to Bioject  for the  purpose of  verifying  the  reports
provided by Bioject pursuant to Section 3.4 above.  Such inspections may be made
no more than twice each year, at reasonable times and on reasonable  notice. The
independent  auditor shall be obligated to execute a reasonable  confidentiality
agreement prior to commencing any such inspection.  Inspections  conducted under
this  Section 3.5 shall be at the expense of  AngioSense,  unless a variation or
error  producing  an  overstatement  exceeding  five  percent  (5%) of the Aject
Development Costs and/or AngioSense  Product  Development  Costs,  respectively,
reported in any period covered by the inspection is established in the course of
any such  inspection,  whereupon all costs  relating to the  inspection for such
period  shall  be paid  by  Bioject.  The  parties  will  endeavor  to  minimize
disruption of Bioject's  normal  business  activities  to the extent  reasonably
practicable.

     3.7 Capital  Equipment.  The Aject Development Costs and AngioSense Product
Development Costs may include reasonable  depreciation charges or lease expenses
allocable to the Aject  Development or the AngioSense  Product  Development  for
certain capital equipment used by



                                      -9-
<PAGE>

Bioject in  connection  with the Aject  Development  or the  AngioSense  Product
Development.  It is  understood  that  Bioject  will be the owner of all capital
equipment  purchased by Bioject in connection with the Aject Development and the
AngioSense  Product  Development , whether or not  separately  identified in the
Aject Development Plan or the AngioSense Product Development Plan.

                                    ARTICLE 4
                                    EQUIPMENT

     4.1 Use of Equipment.  AngioSense  shall acquire,  at its own expense,  and
install or have installed at the Bioject's Facility,  the equipment to be listed
in Exhibit B, attached hereto, created and amended as needed throughout the term
of this  Agreement  ("Equipment").  Additions  or  changes to Exhibit B shall be
approved in writing by both  parties.  Bioject may utilize the Equipment for any
use other than for the  manufacture of the Aject and/or  AngioSense  Product for
AngioSense with the prior written consent of AngioSense, which consent shall not
be unreasonably  withheld, on commercially  reasonable and customary terms which
AngioSense  agrees to negotiate in good faith.  Equipment shall also include but
shall not be limited to (1) all future purchased  manufacturing equipment (e.g.,
tools,  molds, etc.) and (2) Aject and AngioSense Product components supplied by
AngioSense to Bioject.  The Equipment  shall, at all times,  remain the sole and
exclusive property of AngioSense.

     4.2  Repair  and  Maintenance.  Bioject,  at its  expense,  shall  make all
necessary site preparations and cause the Equipment to be operated in accordance
with any applicable operating manuals and manufacturer's  instructions.  Bioject
shall  effect  and  bear  the  expense  of all  necessary  repair,  maintenance,
operation and replacements required to be made to maintain the Equipment in good
condition,  reasonable wear and tear excepted, and to comply with all applicable
laws to which the use and operation of the  Equipment may be or become  subject.
All   replacement   Equipment  and  parts  furnished  in  connection  with  such
maintenance  or repair shall  immediately  become the property of AngioSense and
part of the Equipment for all purposes hereof. All such maintenance,  repair and
replacement  services  shall be  immediately  paid for and discharged by Bioject
with the  result  that no lien  under any  applicable  laws  will  attach to the
Equipment as a result of the  performance  of such  services or the provision of
any such material.

     4.3  Insurance.  Bioject  shall  obtain and  maintain  for the term of this
Agreement,  at its own expense,  (a) "all risk" insurance against loss or damage
to  the  Equipment,   (b)  commercial  general  liability  insurance  (including
contractual  liability,  products liability and completed  operations  coverage)
reasonably satisfactory to AngioSense, and (c) such other insurance against such
other  risks of loss and with such  terms,  as shall in each case be  reasonably
satisfactory  to or reasonably  required by AngioSense (as to carriers,  amounts
and  otherwise).  The amount of the "all risk"  insurance  shall be equal to the
replacement value of all Equipment and must otherwise be reasonably satisfactory
to AngioSense as of each anniversary date of this Agreement.

     4.4  Replacement.  If any items of Equipment  shall  become  lost,  stolen,
destroyed,  or  damaged  beyond  repair  for  any  reason,  or in the  event  of
condemnation,  confiscation,  seizure or  requisition of title to or use of such
items (collectively, an "Event of Loss"), Bioject shall promptly



                                     -10-
<PAGE>


pay to AngioSense the fair market value of the Equipment subject to the Event of
Loss as  determined  by an  objective  third party  evaluator  agreeable to both
parties.  Upon payment of such amount by Bioject,  AngioSense  will  transfer to
Bioject, "AS IS, WHERE IS, WITHOUT RECOURSE, REPRESENTATION OR WARRANTY," all of
AngioSense's right, title and interest, if any, in such items of Equipment.

     4.5 Ownership.  AngioSense  and Bioject  confirm their intent that title to
the  Equipment  shall  remain in  AngioSense  (or its  successors  and  assigns)
exclusively.  If requested by AngioSense,  Bioject will affix plates or markings
on the Equipment and on any operating  manuals and  manufacturer's  instructions
indicating the interests of AngioSense and its assigns therein, and Bioject will
not allow any other  indicia of ownership or other  interest in the Equipment to
be placed on the  Equipment.  Bioject shall not sell,  assign,  grant a security
interest in, sublet, pledge,  hypothecate or otherwise encumber or suffer a lien
upon or against the Equipment.

     4.6 Location.  Bioject may move such Equipment from the Bioject's  Facility
only if Bioject  gives at least  thirty  (30) days prior  written  notice of the
relocation  or  provides  such  other  documentation  as  AngioSense  reasonably
requests to protect its interest in the Equipment.

     4.7  Documents.  Bioject  shall keep  copies of all  operating  manuals and
manufacturer's  instructions  with respect to the Equipment in good condition at
the Facility.

     4.8 Right of First Refusal.  In the event AngioSense  should decide to sell
or  otherwise  dispose of any or all of the  Equipment,  Bioject  shall have the
right of first refusal to purchase  such  Equipment at  AngioSense's  good faith
determination  of the  Equipment's  fair market value.  If Bioject elects not to
purchase the Equipment  under this Section 4.8,  Bioject shall,  at AngioSense's
expense,  return the Equipment to AngioSense in the same condition as delivered,
normal wear and tear expected, at such location as AngioSense shall designate.

                                   ARTICLE 5

                              CLINICAL DEVELOPMENT

     5.1  Clinical  Development.  During  the term of this  Agreement  II and in
accordance  with the decisions of the Joint  Development  Committee,  AngioSense
shall be responsible, at its expense, for conducting,  directly or through third
parties,  all Clinical Development for the Aject and the AngioSense Products for
applications  within the Field or, where licensed,  the Extended  Field,  and in
accordance with the protocol and the timetable approved by the Joint Development
Committee.  AngioSense agrees to keep the Joint Development Committee reasonably
informed  as to the  progress  of  Clinical  Development  of the  Aject  and the
AngioSense  Products  hereunder.  It is  understood  and agreed that,  except as
otherwise  expressly  agreed in writing,  Bioject  shall have no  obligation  to
perform  pre-clinical  studies  or  clinical  trials  or other  portions  of the
Clinical  Development;  provided,  however,  Bioject  shall  provide  reasonable
assistance to AngioSense  regarding Clinical Development of the Aject and of the
AngioSense  Product and shall supply AngioSense with quantities of the Aject and
of the AngioSense  Product,  as dictated by the Aject  Development  Plan and the
AngioSense Development Plan, respectively, to be determined by the





                                      -11-
<PAGE>

Joint  Development  Committee  pursuant to Article 3, as reasonably  required to
carry out clinical  trials in accordance  with the laws and regulations and Good
Manufacturing  Practice  (GMP)  standards  as  established  by  the  FDA  and in
accordance with Article 10 below.

     5.2 Data.  AngioSense  shall provide the Joint  Development  Committee with
detailed  preclinical  and/or  clinical  data acquired or produced by AngioSense
pursuant to Section 5.1 above.

     5.3 Regulatory  Filings.  AngioSense  shall prepare and file all regulatory
documents for the Aject and the AngioSense Product, including Marketing Approval
Applications for the Field, and shall use its best efforts to secure approval of
such  applications and thereafter  maintain such approvals.  All such activities
shall  be  done in full  consultation  with  the  Joint  Development  Committee,
including without  limitation,  all product  registration plans and applications
for marketing approvals  (including  Marketing Approval  Applications filed with
the FDA and other  regulatory  agencies,  and  similar  applications,  including
applications for pricing approval and governmental reimbursement  authorization)
for the  Aject  and the  AngioSense  Product  shall be  submitted  to the  Joint
Development Committee for review and approval by the Joint Development Committee
prior to filing of such registrations with any health regulatory agency. Bioject
shall provide reasonable  assistance to AngioSense  regarding the filing for and
maintenance  of such  regulatory  documents  for the  Aject  and the  AngioSense
Product  within  the  Field,  including  providing  AngioSense  with a right  of
reference to any applicable  materials filed by Bioject to any relevant  agency.
All regulatory documents including Marketing Approval Applications for the Aject
and the  AngioSense  Product  shall be filed in  AngioSense's  name,  except  as
otherwise required by local law.

                                    ARTICLE 6
                                     EQUITY

     6.1 Equity. In consideration of the rights granted to AngioSense hereunder,
AngioSense  shall issue to Bioject 277,222 shares of AngioSense  Common Stock in
accordance with the Milestone and Stock Payment  Schedule set forth on Exhibit C
and upon execution of the Stock Purchase Agreement attached as Exhibit D.

                                   ARTICLE 7
                                 GRANT OF RIGHTS

     7.1  License  Grant.  Bioject  hereby  grants to  AngioSense  a  worldwide,
exclusive,  royalty-bearing license, with the right to grant sublicenses,  under
the Licensed Technology and under Bioject's interest in Improvements to make and
have made, to the extent set forth in Section 8.5.2, use, import, distribute and
sell the Aject and AngioSense Product in the Field.

     7.2 Right of First Refusal in the Extended Field.  Bioject hereby grants to
AngioSense  a right of first  refusal to obtain an exclusive  license,  with the
right to grant sublicenses, under the Licensed Technology and Bioject's interest
in Improvements to develop,  make or have made,  subject to Section 8.5.2,  use,
distribute, sell and import the Aject and the AngioSense Product in the





                                      -12-
<PAGE>

Extended  Field.  Upon  receipt of  Bioject's  notice of intent to  negotiate  a
license for the Licensed  Technology and Improvements in the Extended Field, the
parties  shall  negotiate in good faith the terms of such  license  within sixty
(60) days.  In the event the parties are unable to agree on such terms,  Bioject
shall be free to enter into an agreement with a third party on the same terms as
offered to AngioSense. 7.3 Prohibition on Reverse Engineering.  AngioSense shall
not reverse engineer the Iject, the Aject or any Improvements.

                                   ARTICLE 8
                               SUPPLY OF THE AJECT

     8.1 Terms and  Conditions.  All  supply of the Aject and of the  AngioSense
Product  by  Bioject  and all  purchases  of the Aject  (alone or as part of the
AngioSense  Product) by AngioSense  hereunder  shall be subject to the terms and
conditions of this Article 8.

     8.2 Product  Supply and  Purchase.  Subject to the terms and  conditions of
this  Article 8,  except as set forth in Section  8.5.2,  Bioject  shall  supply
AngioSense with AngioSense's  commercial requirements for the Aject (alone or as
part of the AngioSense Product) in accordance with applicable Good Manufacturing
Practices (GMP) as established by the FDA. Except as set forth in Section 8.5.2,
AngioSense  shall  purchase  all of its  commercial  requirements  for the Aject
(alone or as part of the AngioSense Product) from Bioject.

8.3 Minimum
Purchase  Requirements.  AngioSense will notify Bioject promptly upon receipt of
FDA approval to market the Aject and/or the  AngioSense  Product for any drug or
non-drug for any indication in the Field.  At such time,  Bioject and AngioSense
will negotiate in good faith, reasonable quarterly minimum purchase requirements
by AngioSense.  In the event the parties are unable to agree,  the provisions of
Section 18.2 shall apply.

     8.4  Forecasts.  During the term of this Agreement II, at least thirty (30)
days prior to the start of any calendar month , AngioSense shall provide Bioject
with a rolling written forecast of the quantities the Aject (alone or as part of
the AngioSense Product) (on a Product-by-Product basis) estimated to be required
on a  month-by-month  basis for twelve (12)  consecutive  months ("M1" to "M12",
respectively)  (the  "Forecast").  Each Forecast  shall  identify an anticipated
launch date for the Aject (alone or as part of the AngioSense  Product).  Except
as set forth in Section 8.5 below,  AngioSense  will provide such Forecasts as a
means of production  planning only and shall not constitute a binding obligation
upon  Bioject or  AngioSense.

     8.5 Orders.

          8.5.1 Orders.  Together with each forecast  provided under Section 8.4
above,  AngioSense  shall place its firm order with  Bioject for delivery of the
Aject (alone or as part of the AngioSense  Product) for the next three (3) month
period ("Firm Order").



                                      -13-
<PAGE>

          8.5.2 Form of Order.  AngioSense's  orders shall be made pursuant to a
written  purchase  order which is in a form mutually  acceptable to the parties,
and shall provide for shipment in accordance with reasonable  delivery schedules
as may be agreed upon from time to time by Bioject and AngioSense.

     8.6 Delivery.  Bioject shall ship forecasted quantities the Aject (alone or
as part of the  AngioSense  Product) in  accordance  with orders  submitted  and
accepted in accordance with Section 8.5 above.

          8.6.1  Allocation.  In the  event  that  Bioject  is  unable  to  meet
AngioSense's  requirements  for the Aject  (alone  or as part of the  AngioSense
Product)  under either  Section 8.2 or Section 8.5 above due to force majeure or
otherwise,  Bioject  shall  allocate  such  quantities  of  parts  and  services
necessary for supplying the Aject that Bioject has in its then current inventory
and control for the  production  of Ajects  (alone or as part of the  AngioSense
Product) so that AngioSense  receives at least its proportional share (vis-a-vis
other  distributors  of Bioject's  similar  products)  of available  supplies as
determined based on reasonable  Forecasts (taking into  consideration past usage
and usage  performance  against  forecast).

          8.6.2  Right to  Manufacture.  If for  three  (3)  consecutive  months
Bioject fails to adequately supply AngioSense's requirements of the Aject (alone
or as part of the  AngioSense  Product),  and provided that such failure will or
does result in a  substantial  interruption  of supply of the Aject (alone or as
part of the  AngioSense  Product)  to the  commercial  market  and is not due to
action or inaction of  AngioSense,  then  AngioSense  may  manufacture  (or have
manufactured)  pursuant to this Section  8.5.2 the  quantities of the Aject that
Bioject  fails to so  supply.  A  failure  to  "adequately  supply  AngioSense's
requirements"  shall mean a failure to supply AngioSense ninety percent (90%) of
the quantities of the Aject (alone or as part of the AngioSense Product) ordered
in accordance with this Agreement II, in any three (3) consecutive  months.  The
provisions of this  paragraph  8.6.2 shall not be applicable for any month which
becomes  the subject of a Firm Order and for which month said Firm Order is more
than fifteen  percent  (15%)  greater than the Forecast  last  provided for such
month. Notwithstanding the foregoing, the provisions of this Section 8.6.2 shall
not become  effective until the first month  beginning  twelve (12) months after
the first Firm Order.

               8.6.2.1  License to  Manufacture.  Subject to all other terms and
conditions  of this  Agreement  II, where the  provisions  of Section  8.6.2 are
applicable, Bioject hereby grants to AngioSense, and AngioSense hereby accepts a
license (the  "Bioject  License")  under the Licensed  Technology  and Bioject's
interest in Improvements, with the right of sublicense to make and have made the
Aject (alone or as part of the AngioSense  Product) (which Bioject has failed to
adequately supply as set forth above).

               8.6.2.2 Exercise of the Bioject License. AngioSense agrees not to
exercise any of its rights under the Bioject License granted pursuant to Section
8.6.2.1,  except to the extent  expressly  permitted in Section 8.6.2 above.  In
such event,  Bioject  shall provide to  AngioSense  copies of all  documentation
within Bioject's control that is reasonably necessary for





                                      -14-
<PAGE>


AngioSense to manufacture (or have  manufactured) the Aject (alone or as part of
the AngioSense  Product),  and shall  reasonably  cooperate  with  AngioSense to
establish  alternative  supply,  including sources of materials.  AngioSense may
exercise  its  right  to have  the  Aject  (alone  or as part of the  AngioSense
Product)  manufactured  in  accordance  with Section 8.5.2 through a third party
contract   manufacturer.

               8.6.2.3  Return  of  Equipment.   Immediately  upon  AngioSense's
exercise  of the Bioject  License  pursuant to Section  8.6.2.2,  Bioject  shall
immediately  allow  AngioSense,  at AngioSense's  expense,  to pack and ship all
Equipment to a designation specified by AngioSense.  In such event, the transfer
price of the Aject (alone or as part of the  AngioSense  Product) shall be zero.


     8.7  Invoicing.  Bioject  shall submit an invoice to  AngioSense  upon each
shipment of the Aject (alone or as part of the  AngioSense  Product)  ordered by
AngioSense.  All  invoices  shall be sent to  AngioSense's  address  for notices
hereunder, and each such invoice shall state AngioSense's aggregate and Transfer
Price  (as  defined  in  Section  9.1  below)  for a given  shipment,  plus  any
insurance,  taxes or other costs incident to the purchase or shipment  initially
paid by Bioject  but to be borne by  AngioSense  hereunder.

     8.8 Shipping.  All Ajects or AngioSense  Products delivered pursuant to the
terms of this Agreement II shall be suitably  packed for shipment by Bioject and
marked for shipment to the destination point indicated in AngioSense's  purchase
order.  All such  shipments  will be delivered FCA  (Incoterms  1990) the United
States  shipping point  designated by Bioject.  The carrier shall be selected by
AngioSense.  All shipping and insurance costs, as well as any special  packaging
expenses, shall be paid by AngioSense.

     8.9 Product  Acceptance.  All  shipments and all shipping and other charges
shall be deemed correct unless Bioject receives from  AngioSense,  no later than
thirty  (30)  days  after the  shipment  date,  written  notice  specifying  the
shipment,  the purchase order number, and the nature of the discrepancy  between
the  order  and the  shipment  or the exact  nature  of the  discrepancy  in the
shipping or other charges, as applicable.  Each shipment of the Aject and of the
AngioSense  Product  hereunder shall be accompanied by certified quality control
protocol such and other information as may be reasonably requested by AngioSense
from time to time for each lot of the Aject  (alone or as part of an  AngioSense
Product) therein as well as such customs and other documentation as is necessary
or  appropriate.

     8.10 Return of Product.  All returns of the Aject  (alone or as part of the
AngioSense  Product) shall be in accordance  with a mutually  agreeable  product
return policy.




                                      -15-
<PAGE>

                                   ARTICLE 9
                     TRANSFER PRICING; ROYALTIES; PAYMENTS;
                                BOOKS AND RECORDS

     9.1 Transfer Pricing.

     9.1.1  Commercial  Products.  Subject to the provisions of Section 8.5.2.3,
the  transfer  price of the Aject (alone or as part of the  AngioSense  Product)
supplied to  AngioSense  hereunder  is  estimated as set forth in Exhibit E (the
"Estimated  Transfer  Price") based on Bioject's  representation  of the current
configuration of the Iject. The actual transfer price for the Aject (alone or as
part of the  AngioSense  Product)  shall be determined by the Joint  Development
Committee  in the  context of the Aject  Development  Budget and the  AngioSense
Product  Development  Budget,  respectively,  shall take into account  estimated
sales volumes,  the cost of goods, and the anticipated  average selling price of
the Aject (alone or as part of the  AngioSense  Product)  (the "Actual  Transfer
Price");  provided  however,  the parties  contemplate that such Actual Transfer
Price shall provide Bioject with a reasonable  profit margin,  and considered to
be *** to  Bioject  from the  transfer  price in  Exhibit  E of this  agreement.
Notwithstanding  the foregoing,  once the Actual  Transfer Price is established,
such Actual  Transfer Price shall be subject to an annual increase not to exceed
the greater of *** percent (***%) or the increase in the *** for the immediately
preceding  year.  Bioject will give  AngioSense  thirty (30) days' prior written
notice of such increase. With respect to amounts due to Bioject for units of the
Aject  supplied to AngioSense  under this Section  9.1.1,  AngioSense  shall pay
Bioject  within  thirty  (30) days of invoice or date of  shipment of the Aject,
whichever is later.

          9.1.2 Development  Products.  With respect to units of the Aject to be
used for research,  development,  and clinical  testing  within the scope of the
Aject  Development  Plan  and the  AngioSense  Product  Development  Plan and in
accordance  with Article 5 of this  Agreement II, Bioject agrees to transfer the
Aject (alone or to be used as part of the  AngioSense  Product)  free of charge;
provided, however AngioSense shall be responsible for all shipping and insurance
charges  for such as set forth in Section  8.7 above.  Notwithstanding  anything
herein  to the  contrary,  Bioject  shall be  obligated  to  supply  only  those
quantities of the Aject for use within the scope of the Aject  Development  Plan
and the  AngioSense  Development  Plan as  reasonably  determined  by the  Joint
Development Committee. All units of the Ajects supplied to AngioSense under this
Section 9.1.2 shall not be used for any other purpose.

     9.2  Inventory.  During the term of this  Agreement  II,  AngioSense  shall
maintain a quantity of the Aject as AngioSense  deems  appropriate,  in its sole
discretion,  in order to meet the product requirements of AngioSense's customers
and potential customers.

     9.3  Royalty.   In  consideration  of  the  rights  granted  to  AngioSense
hereunder, AngioSense shall pay Bioject a royalty equal to *** percent (***%) of
*** of the Aject and/or the AngioSense Product by AngioSense, its Affiliates and
Sublicensees  covered by a Valid Claim of a Licensed Patent, or any patent which
claims Joint  Inventions,  in the country in which such is sold.  Payments under
this  Section  9.3 shall be made on no more than one sale  transaction  for each
Aject



                                      -16-
<PAGE>

and/or AngioSense  Product. No multiple royalties shall be payable regardless of
the fact that the  manufacture,  use or sale of the Aject and/or the  AngioSense
Product may be covered by more than one Valid Claim licensed hereunder.  For the
removal of doubt, the royalties payable under this Section 9.3 shall continue to
apply after the manufacturing license in Section 8.5.2 becomes effective.

          9.3.1 Royalty Payments.  With respect to royalties due on sales of the
Aject this Section 9.3,  AngioSense shall provide to Bioject a quarterly royalty
report as  follows:  After the first sale of the Aject  (alone or as part of the
AngioSense Product) hereunder, within forty-five (45) days after the end of each
calendar  quarter,  AngioSense  shall  deliver  to  Bioject a true and  accurate
report,  giving such  particulars of the business  conducted by AngioSense,  its
Affiliates  and  Sublicensees,  if any,  during  such  calendar  quarter  as are
pertinent  to account  for  royalties  due under this  Article  9,  except  upon
AngioSense's  exercise of the rights granted under Section 8.5.2,  in which case
AngioSense will make such reports and payments to Bioject within forty-five (45)
days after the end of  AngioSense's  fiscal year.  Such report shall  include at
least  (i) the total of *** of the  Aject  (alone  or as part of the  AngioSense
Product)  during such fiscal period;  and (ii) the calculation of royalties owed
to Bioject.  Simultaneously  with the delivery of each such  report,  AngioSense
shall pay to Bioject the total royalties,  if any, due to Bioject for the fiscal
period of such report.  AngioSense shall make all payments to Bioject under this
Agreement II by wire transfer in United States dollars in immediately  available
funds to a bank designated by Bioject.

     9.4 Sublicense Fees.  AngioSense shall pay to Bioject *** percent (***%) of
revenue  received  from  Sublicensees  in the form of up front  license fees and
milestone fees, excluding revenue received for *** and ***.

     9.5 Third Party  Royalties.  If  AngioSense  takes a licenses or  otherwise
acquires  rights from a third party  necessary  for the sale or use of the Aject
(alone or as part of the AngioSense  Product) within the Field,  then AngioSense
shall have the right to deduct the amounts  actually  paid by  AngioSense to the
third party  against  royalties  payable  under  Section 9.3 above,  unless such
technology  is  protected  by a patent owned by  AngioSense  or its  Affiliates.
Notwithstanding  the  foregoing,  in no event shall the royalties due Bioject be
reduced to less than  one-third of the  royalties  payable  before the deduction
described in this Section 9.5.

     9.6 Records; Inspection.  AngioSense shall keep, and require its Affiliates
and  Sublicensees  to keep,  complete,  true and accurate  books of accounts and
records for the purpose of determining the amounts payable under this Article 8.
Such books and records shall be kept for at least three (3) years  following the
end of the calendar quarter to which they pertain. Such records will be open for
inspection during such three (3) year period by an independent auditor chosen by
Bioject and reasonably acceptable to AngioSense for the purpose of verifying the
amounts payable by AngioSense under this Article 9. Such inspections may be made
no more than once each  calendar  year,  at  reasonable  times and on reasonable
notice.  The  independent  auditor  shall be  obligated  to execute a reasonable
confidentiality  agreement prior to commencing any such inspection.  Inspections
conducted under this Section 9.6 shall be at the expense of Bioject, unless a


                                      -17-
<PAGE>

variation or error producing an  underpayment in amounts payable  exceeding five
percent  (5%) of the amount  paid for any period  covered by the  inspection  is
established in the course of any such  inspection,  whereupon all costs relating
to the  inspection  for such period and any unpaid  amounts that are  discovered
shall be paid by AngioSense, together with interest on such unpaid amounts equal
to the lesser of the prime rate as reported in The Wall  Street  Journal  (U.S.,
Eastern  edition)  on the last day of the  calendar  quarter  which such  unpaid
amounts applied plus one percent (1%) per month or the maximum rate permitted by
applicable  law,  calculated  on the number of days  overdue.  The parties  will
endeavor to minimize  disruption of AngioSense's  normal business  activities to
the extent reasonably practicable.

                                   ARTICLE 10
                                COMMERCIALIZATION

     10.1 Technical Literature.  Bioject shall provide to AngioSense appropriate
technical information relating to the Aject from time to time during the term of
this  Agreement II to assist  AngioSense  in  developing  appropriate  technical
literature   and   marketing   materials   to   support   its   efforts  in  the
commercialization of the Aject (alone or as part of the AngioSense Product).

     10.2 Product  Packaging and Labeling.  The trade dress,  style of packaging
and the like  with  respect  to the  Aject and the  AngioSense  Product  will be
determined by AngioSense so as to be consistent with AngioSense's standard trade
dress and style.  AngioSense  shall be responsible for any increase in packaging
and labeling costs over Bioject's current standard costs.

                                   ARTICLE 11
                                PRODUCT WARRANTY

     11.1 Product  Warranty.  Bioject warrants to AngioSense that at the time of
delivery to AngioSense of the Aject (alone or as part of the AngioSense Product)
purchased by AngioSense shall (i) have been manufactured in compliance with Good
Manufacturing  Practices (GMP) as established by the FDA and (ii) conform to the
Aject Specification and/or AngioSense Product  Specification as the case may be.
Bioject makes no warranty (express,  implied, or statutory) for any Aject (alone
or as part of the AngioSense Product) that is modified or subjected to accident,
misuse,  neglect  or  improper  storage.  If the Aject  (alone or as part of the
AngioSense  Product) supplied hereunder fails to conform to the applicable Aject
Specification and/or AngioSense Product  Specification,  AngioSense shall notify
Bioject no later than thirty (30) days after its discovery of the  nonconformity
(but in no event  later  than one  hundred  and  eighty-five  (185)  days  after
delivery) and AngioSense  shall present  reasonable  evidence to Bioject of such
nonconformity.  Bioject agrees to replace at no additional expense to AngioSense
such a nonconfirming  Aject (alone or as part of the AngioSense  Product) with a
new such Aject  which  conforms to the  applicable  Aject  Specification  and/or
AngioSense  Product  Specifications  within  thirty  (30) days after  receipt of
AngioSense's notification under this Section 11.1. Bioject may analyze the Aject
rejected by AngioSense for  nonconformity  and if it is objectively  established
that the Aject was conforming,  then AngioSense shall be responsible for payment
of the Aject. All returns shall be as set forth in Section 8.9 above.  Bioject's
sole obligation under the warranty stated above shall be to repair or replace at
Bioject's



                                      -18-
<PAGE>

option any nonconforming Ajects. OTHER THAN EXPRESSLY SET FORTH HEREIN,  BIOJECT
MAKES NO OTHER WARRANTIES, INCLUDING, BUT NOT LIMITED TO, ANY IMPLIED WARRANTIES
OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR USE.

                                   ARTICLE 12
                              INTELLECTUAL PROPERTY

     12.1 Bioject  Field and  AngioSense  Field.  The parties  acknowledge  that
Bioject has  considerable  knowledge  and expertise in the area of jet injection
(the  "Bioject  Field")  and that  AngioSense  has  considerable  knowledge  and
expertise in the area of delivery of a drug or biologic  agent to the cardiac or
cardiovascular  system via (i) a catheter or (ii) a non-catheter  based delivery
method ( the "AngioSense Field").

     12.2 Joint  Inventions.  Subject to the rights and licenses granted herein,
all right,  title and interest in and to all inventions  and other  intellectual
property   made  jointly  by  personnel  of  AngioSense   and  Bioject   ("Joint
Invention"),  shall be  assigned  to  AngioSense.  AngioSense  shall  retain the
exclusive right to practice in the AngioSense  Field under the Joint  Invention,
and as  licensed  under this  Agreement  II.  Bioject  shall  retain no right to
practice in the AngioSense  Field under the Joint Invention.  AngioSense  hereby
grants to Bioject a royalty-free  exclusive worldwide license, with the right to
sublicense,  under Joint Invention to develop,  make,  have made,  use,  import,
distribute,  and sell products in the Bioject  Field,  except for those areas of
the Bioject Field licensed under this Agreement II.  AngioSense  shall retain no
right to practice in the Bioject Field under Joint Invention, except as licensed
under this Agreement II.

     12.3 Joint  Rights.  The parties  shall share rights to practice  under the
Joint  Invention in areas other than the AngioSense  Field and the Bioject Field
(the "Joint  Rights"),  with each party required to gain the written  consent of
the other in order to sublicense  such Joint Rights,  which consent shall not be
unreasonably  withheld;  and with an obligation to account to and share with the
other party revenues or royalties accrued and paid on account of the exercise of
the Joint Rights.  The parties agree to negotiate in good faith revenue  sharing
relating to the Joint Rights, based on the relative contribution of each party's
technology to the subject Joint Invention.  Each party shall promptly notify the
other party in writing of any Joint Invention,  which obligation shall be met by
disclosure at the next meeting of the Joint  Development  Committee.  Each party
shall ensure that all employees and consultants of such party,  assist the other
in accomplishing the foregoing.

     12.4 Sole  Inventions.  Subject to the rights and licenses  granted herein,
all right,  title and interest in and to all inventions  and other  intellectual
property  made solely by  personnel  of a party  hereto in  connection  with the
performance of such party's obligations  hereunder shall be owned solely by such
party (a "Sole  Invention").  AngioSense  will  promptly  advise  Bioject of the
filing of any patent  application  covering an AngioSense Sole Invention  having
claims that include or reference  technology  covered by any Bioject patent (now
existing  or issued  during  the term of this  Agreement)Bioject  will  promptly
advise  AngioSense  of the filing of any patent  application  covering a Bioject
Sole Invention having claims that include or reference technology covered by any
AngioSense patent (now existing or issued during the term of this Agreement).




                                      -19-
<PAGE>

          12.4.1 AngioSense License Grant to Bioject. AngioSense  hereby  grants
to Bioject a royalty-bearing,  exclusive  worldwide  license,  with the right to
sublicense,  under such AngioSense Sole Inventions to develop,  make, have made,
use, import,  distribute, and sell products in the Bioject Field but outside the
Field and outside the licensed portions of the Extended Field. Bioject agrees to
pay  AngioSense a royalty equal to *** percent (*** %) of *** on products  sold,
leased,   distributed  or  transferred  by  Bioject,   and  its  Affiliates  and
Sublicensees  wherein  such  products  are  covered by a Valid Claim of any such
patent covering an AngioSense Sole Invention.  AngioSense  shall retain no right
to practice in the Bioject Field under such AngioSense Sole Invention, except as
licensed under this Agreement II.

          12.4.2  Bioject License Grant to AngioSense.  Bioject hereby grants to
AngioSense a royalty-bearing,  exclusive  worldwide  license,  with the right to
sublicense,  under such Bioject Sole Invention to develop, make, have made, use,
import, distribute, and sell products in the AngioSense Field. AngioSense agrees
to pay Bioject a royalty  equal to *** percent  (***%) of *** on products  sold,
leased,   distributed  or  transferred  by  Bioject,   and  its  Affiliates  and
Sublicensees  wherein  such  products  are  covered by a Valid Claim of any such
patent  covering an Bioject  Sole  Invention.  Bioject  shall retain no right to
practice in the  AngioSense  Field under such  Bioject  Sole  Invention,  except
pursuant to the  provisions of this Agreement II. 12.4.3  Payment;  Sublicenses;
Third Party Licenses.  All provisions of Article 8 of this Agreement II relating
to payment of royalties, sublicense fee, and third party licenses shall apply to
the licenses granted under Section 12.4 hereunder.

     12.5 Patent Prosecution.

          12.5.1 Sole Inventions.  Each party shall, at its expense, control the
preparing, filing, prosecuting and maintaining the patent applications developed
solely by its  employees  during  the course of this  Agreement.  In the event a
party elects not to maintain a patent,  that party shall notify the other party,
in writing,  at least  thirty  (30) days prior to the due date of a  maintenance
fee,  and that other  party  shall have the option of paying the fee to maintain
the patent.  In that event, the patent shall be assigned to the party paying the
maintenance fee.

          12.5.2  Joint  Inventions.  AngioSense  shall have the first  right to
prepare,  file,  prosecute and maintain  patent  applications  and patents which
claim Joint  Inventions.  Without limiting the foregoing,  AngioSense  agrees to
first  consult  with  Bioject as to the  preparation,  filing,  prosecution  and
maintenance of such patents and patent applications and shall furnish to Bioject
copies of documents  relevant to any such preparation,  filing,  prosecution and
maintenance  and  AngioSense  further  agrees to  incorporate  all of  Bioject's
reasonable  comments with respect thereto.  In the event that AngioSense  elects
not to pay any costs  and fees with  respect  to a  particular  patent or patent
application covering a Joint Invention or elects not to pursue patent protection
for any Joint Invention, then AngioSense shall give Bioject at least thirty (30)
days prior written  notice thereof and shall assign to Bioject all of its right,
title and interest therein.




                                      -20-
<PAGE>

          12.5.3  Cooperation.   Bioject  shall  cooperate  with  AngioSense  in
connection with such activities  under Section 12.5.2,  at AngioSense's  request
and expense.

     12.6 Improvements.  Upon conceiving of an Improvement, the conceiving party
shall  promptly  disclose to the other party the  inventions,  patent rights and
other subject matter within the Improvement so conceived. This prompt disclosure
requirement  shall be met if disclosure is made at the next meeting of the Joint
Development   Committee.   Upon  AngioSense's   request  Bioject  shall  provide
AngioSense  with access to Technical  Information  as  reasonably  necessary for
AngioSense to exploit the licenses granted in this Agreement II.

     12.7 Defense of Third Party Infringement  Claims. If the sale or use of the
Aject within the Field pursuant to this Agreement II results in a claim, suit or
proceeding  brought by a third  party  against  AngioSense  or Bioject  alleging
infringement of such third party's patents ("Action"), such party shall promptly
notify the other party hereto in writing. The party subject to such Action shall
have the  exclusive  right to defend and  control the defense of any such Action
using  counsel of its own choice,  and the Action  shall be at such  party's own
expense; provided,  however, that the other party may participate in the defense
and/or  settlement  thereof at its own expense with  counsel of its choice.  The
party  subject to the Action  agrees to keep the other party  hereto  reasonably
informed of all material  developments  in connection  with any such Action.  If
both parties are named as defendants  or are the subject of a claim,  they agree
to jointly defend the action.  In the event of such joint  defense,  the parties
shall  agree  to equal  finding  as well as equal  say in the  determination  of
counsel, control of the litigation and the settlement thereof.

     12.8  Enforcement.  If either party  determines  or has a reason to believe
that any  Licensed  Patent or any patent  covering  Joint  Inventions,  which is
necessary for the manufacture, use or sale of the Aject, is being infringed by a
third party or is subject to a  declaratory  judgment  action  arising from such
infringement,  (an  "Infringement"),  such party shall promptly notify the other
party hereto.

          12.8.1 By  Bioject.  Bioject  shall  have the first  right  (itself or
through  others),  at its sole option and expense,  to bring suit to enforce the
intellectual  property rights within such Licensed  Technology  and/or to defend
any declaratory  judgment action with respect thereto, in each case with respect
to an  Infringement  (each,  for  purposes  of  Section  12.8,  an  "Enforcement
Action").

          12.8.2 By  AngioSense.  In the event Bioject elects not to initiate an
Enforcement Action against a commercially significant Infringement, within three
(3) months of a request by  AngioSense  to do so,  AngioSense  may initiate such
Enforcement  Action at its expense with Bioject's prior written consent,  as the
parties mutually agree.  Bioject shall have the right to participate in any such
action with counsel of its own choice at its own expense.

          12.8.3 Recoveries.  All recoveries from an Enforcement Action shall be
first applied to reimburse the controlling  party's and then the non-controlling
party's  unreimbursed   expenses,   including  without  limitation,   reasonable
attorney's  fees and court costs.  Any remainder  shall,  to the extent the same
relates to the Infringement, be treated as Net Sales.



                                      -21-
<PAGE>

          12.8.4 Cooperation. In addition, with regard to any Enforcement Action
the non-controlling party shall cooperate with the controlling party,  including
without  limitation,  by joining as a party plaintiff,  executing  documents and
making available all relevant personnel, records, papers, information,  samples,
specimen and other similar materials in the non-controlling  party's possession,
in each case as the controlling party may reasonably request

                                   ARTICLE 13
                         REPRESENTATIONS AND WARRANTIES

     13.1 Bioject Warranties. Bioject warrants and represents to AngioSense that
(i) it has the full  right and  authority  to enter into this  Agreement  II and
grant the rights granted herein; (ii) it has not previously granted and will not
grant any rights in conflict with the rights granted herein;  (iii) to Bioject's
knowledge  and belief,  there are no  threatened  or pending  actions,  suits or
claims  against  it with  respect  to its right to enter  into and  perform  its
obligations  under  this  Agreement  II;  and  (iv)  Bioject's  obligations  and
AngioSense's  rights  hereunder shall not be encumbered or in any way diminished
by a Change in Control of Bioject.

     13.2 AngioSense  Warranties.  AngioSense warrants and represents to Bioject
that (i)  AngioSense  has the full  right  and  authority  to  enter  into  this
Agreement  and  grant  the  rights  granted  herein;  (ii)  AngioSense  has  not
previously  granted  and will not grant any rights in  conflict  with the rights
granted  herein;  (iii) to  AngioSense's  knowledge  and  belief,  there  are no
existing or threatened actions,  suits or claims pending against it with respect
to its right to enter into and perform its obligations under this Agreement; and
(iv)  AngioSense's  obligations  and  Bioject's  rights  hereunder  shall not be
encumbered or in any way diminished by a Change in Control of AngioSense.

                                   ARTICLE 14
                                CONFIDENTIALITY

     14.1 Confidential  Information.  Except as expressly  provided herein,  the
parties  agree  that,  for the term of this  Agreement  II and  thereafter,  the
receiving  party shall not publish or  otherwise  disclose and shall not use for
any purpose any  information  furnished to it by the other party hereto pursuant
to  this   Agreement  II  which  if   disclosed  in  tangible   form  is  marked
"Confidential" or with other similar designation to indicate its confidential or
proprietary  nature,  or if disclosed  orally is confirmed  as  confidential  or
proprietary  by the  party  disclosing  such  information  at the  time  of such
disclosure  ("Confidential  Information").  Notwithstanding the foregoing, it is
understood  and  agreed  that   Confidential   Information   shall  not  include
information that, in each case as demonstrated by written documentation: (a) was
already  known  to the  receiving  party,  other  than  under an  obligation  of
confidentiality,  at the time of disclosure;  (b) was generally available to the
public or otherwise  part of the public domain at the time of its  disclosure to
the receiving party;  (c) became generally  available to the public or otherwise
part of the public domain after its disclosure and other than through any act or
omission  of the  receiving  party in  breach of this  Agreement  II; or (d) was
subsequently  lawfully disclosed to the receiving party by a person other than a
party  hereto or  developed  by the  receiving  party  without  reference to any
information or materials disclosed by the disclosing party.



                                      -22-
<PAGE>

     14.2 Permitted Disclosures.  Notwithstanding the provisions of Section 14.1
above,  each party hereto may disclose the other's  Confidential  Information to
the extent such  disclosure is reasonably  necessary,  in filing or  prosecuting
patent  applications,   prosecuting  or  defending  litigation,  complying  with
applicable  governmental  regulations,  submitting  information  to tax or other
governmental  authorities,  or conducting  clinical  trials or in exercising its
rights hereunder (including granting any permitted  sublicenses),  provided that
if a party is legally  required to make any such  disclosure of another  party's
Confidential  Information,  to the  extent  it may  legally  do so, it will give
reasonable  advance  written notice to the latter party of such  disclosure and,
save to the extent  inappropriate in the case of patent  applications,  will use
its reasonable  efforts to secure  confidential  treatment of such  Confidential
Information  prior to its  disclosure  (whether  through  protective  orders  or
otherwise).

                                   ARTICLE 15
                                 INDEMNIFICATION

     15.1 Indemnification of Bioject. AngioSense shall indemnify each of Bioject
and its directors,  officers,  and employees and the  licensors,  successors and
assigns  of any of the  foregoing  (the  "Bioject  Indemnitees"),  and hold each
Bioject Indemnitee  harmless from and against any and all liabilities,  damages,
settlements,  claims,  actions,  suits,  penalties,  fines,  costs  or  expenses
(including, without limitation, reasonable attorneys' fees and other expenses of
litigation)  (a "Claim")  incurred by any Bioject  Indemnitee,  arising  from or
occurring  as a result of a product  liability  claim for the Aject (alone or as
part of the AngioSense Product) except in which such claim is due to a breach of
Bioject's warranties under Section 13.1.

     15.2  Indemnification  of  AngioSense.  Bioject  shall  indemnify  each  of
AngioSense  and its  directors,  officers,  and employees and the successors and
assigns of any of the foregoing (the  "AngioSense  Indemnitees"),  and hold each
AngioSense  Indemnitee  harmless  from  and  against  any and  all  liabilities,
damages,  settlements,  claims,  actions,  suits,  penalties,  fines,  costs  or
expenses (including,  without limitation,  reasonable  attorneys' fees and other
expenses of  litigation)  (a "Claim")  incurred  by any  AngioSense  Indemnitee,
arising from or occurring  as a result of breach of Bioject's  warranties  under
Section 13.1.

     15.3  Procedure.   A  party  (the   "Indemnitee")  that  intends  to  claim
indemnification under this Article 14 shall promptly notify the other party (the
"Indemnitor")  in writing of any loss,  claim,  damage,  liability  or action in
respect of which the  Indemnitee or any of its directors,  officers,  employees,
licensors,  successors  or assigns  intends to claim such  indemnification,  the
Indemnitor shall have sole control of the defense and/or settlement thereof. The
indemnity  agreement  in this  Article  15 shall  not apply to  amounts  paid in
settlement of any Claim if such  settlement  is effected  without the consent of
the Indemnitor, which consent shall not be withheld unreasonably. The failure to
deliver  written  notice to the  Indemnitor  within a reasonable  time after the
commencement  of any such action,  if  prejudicial to its ability to defend such
action,  shall relieve such Indemnitor of any liability to the Indemnitee  under
this Article 15 but the omissions so to deliver written notice to the Indemnitor
shall  not  relieve  the  Indemnitor  of any  liability  that it may have to any
Indemnitee  otherwise  than under this  Article  15. The  Indemnitee  under this
Article 15 and its employees, shall





                                      -23-
<PAGE>

cooperate  fully with the Indemnitor and its legal  representatives  and provide
full   information   in  the   investigation   of  any  Claim  covered  by  this
indemnification.

                                   ARTICLE 16
                              TERM AND TERMINATION

     16.1 Term.  This  Agreement II shall become  effective as of the  Effective
Date and,  unless earlier  terminated  pursuant to the other  provisions of this
Article  16,  shall  continue  in full  force and  effect  for the longer of (i)
fifteen (15) years after the Effective  Date or (ii)  expiration,  revocation or
invalidation  of the last patent or abandonment  of the last patent  application
within the Licensed Patents.

     16.2 Termination for Cause. Either Bioject or AngioSense may terminate this
Agreement II by written  notice  stating each party's intent to terminate in the
event the other shall have  materially  breached or defaulted in the performance
of any of its  material  obligations  hereunder,  and such  default  shall  have
continued for sixty (60) days after written  notice  thereof was provided to the
breaching party by the non-breaching party.

     16.3  Bankruptcy  Proceedings.  Either  party  hereto  may  terminate  this
Agreement II by notice to the other party, if (i) such other party shall make an
assignment of substantially all of its assets for the benefit of creditors, file
a petition in bankruptcy,  petition or apply to any tribunal for the appointment
of a custodian,  receiver or any trustee for such party or substantially  all of
such party's assets,  or shall commence any proceeding  under any dissolution or
liquidation law or statute of any jurisdiction (provided that no entity succeeds
to the business of such party following such dissolution or liquidation) whether
now or  hereafter in effect which is not  dismissed  within sixty (60) days;  or
(ii) there shall have been filed any such petition or  application  against such
other  party,  or any such  proceeding  shall have been  commenced  against such
party, in which an order for relief is entered or which remains  undismissed for
a period of ninety  (90) days or more;  or (iii) such  other  party by an act or
knowing  failure to act shall indicate such party's  consent to,  approval of or
acquiescence  in, any such  petition,  application  or  proceeding  or order for
relief or the  appointment  of a  custodian,  receiver  or any  trustee for such
party,  or any  substantial  part of any of such  party's  properties,  or shall
suffer  any  such   custodianship,   receivership  or  trusteeship  to  continue
undischarged for a period of ninety (90) days or more.

     16.4 Effect of Expiration and Termination.

          16.4.1 Accrued  Obligations.  Termination of this Agreement II for any
reason shall not release any party hereto from any liability  which, at the time
of such  termination,  has  already  accrued  to the  other  party  or  which is
attributable  to a period prior to such  termination,  nor preclude either party
from  pursuing  all rights and  remedies it may have  hereunder  or at law or in
equity with respect to any breach of this Agreement II.

          16.4.2  Refund  of  Aject  Development  Funding.  In  the  event  that
AngioSense  terminates  this  Agreement  II for cause  pursuant to Section  16.2
above, Bioject shall refund within



                                      -24-
<PAGE>

thirty (30) days of the effective date of such termination all Costs, as defined
in Section  3.3,  paid to Bioject  pursuant to Article 3 for the three (3) month
period to which the most  recent  Cost  payment  applies  in excess of the Aject
Development  Costs and the  AngioSense  Product  Development  Costs  incurred by
Bioject  during such three month period and prior to the effective  date of such
termination. Bioject will provide AngioSense a financial statement setting forth
the Costs  incurred for such three (3) month period prior to the effective  date
of such  termination;  provided,  however in the event Bioject  disputes in good
faith  AngioSense's  right to terminate the Agreement II for cause, then Bioject
shall place any disputed  amounts into an interest bearing escrow and AngioSense
shall not be entitled to such refund until it is determined  in accordance  with
Section  18.2  below  that  Bioject  was in  material  breach or  default in the
performance of any of its material  obligations  hereunder and failed to correct
such  breach or  default,  within  sixty (60) days after  receipt of notice from
AngioSense  under Section 16.2, in which case the disputed amounts plus interest
shall be  refunded  to  AngioSense,  or in the case that it is  determined  that
AngioSense  did not have the right to  terminate  this  Agreement  II for cause,
Bioject  shall have the right to retain such  disputed  amounts  plus  interest.


          16.4.3 Products in Inventory.  AngioSense  shall purchase all units of
the Aject  (alone or as part of the  AngioSense  Product)  ordered  pursuant  to
Section 8.5.1 as of the date of  termination.  AngioSense and its Affiliates and
Sublicensees shall have the right to distribute any units of the Aject (alone or
as part of the  AngioSense  Product) in their  inventories or otherwise in their
control as of the  termination  of this  Agreement II for a period not to exceed
six (6) months  from such  termination,  in all cases,  subject to the  payments
under Article 9 above.

          16.4.4 No Renewal,  Extension or Waiver.  Acceptance by Bioject of any
order for the Aject (alone or as part of the AngioSense Product) from AngioSense
after  the  effective  date of  termination  of this  Agreement  II shall not be
construed as a renewal or extension  hereof,  or as a waiver of  termination  of
this Agreement II.

          16.4.5 Return of Equipment. Immediately upon termination or expiration
of this Agreement II, Bioject shall return to AngioSense all Equipment  provided
to it under this Agreement II.

     16.5 Survival.  Articles 1, 11, 12, 13, 14, 15, 16, 17 and 18, and Sections
3.6 and 9.6 shall survive expiration or termination of this Agreement II for any
reason.

                                   ARTICLE 17
                            LIMITATION OF LIABILITY

EXCEPT WITH RESPECT TO A BREACH OF ARTICLE 15, IN NO EVENT SHALL EITHER PARTY BE
LIABLE TO THE OTHER OR ANY THIRD PARTY FOR COSTS OF  PROCUREMENT  OF  SUBSTITUTE
GOODS, LOST PROFITS, OR ANY OTHER SPECIAL, CONSEQUENTIAL, OR INCIDENTAL DAMAGES,
HOWEVER  CAUSED AND UNDER ANY THEORY OF LIABILITY  ARISING OUT OF THIS AGREEMENT
WHETHER BASED IN CONTRACT,  TORT  (INCLUDING  NEGLIGENCE),  OR OTHERWISE.  THESE
LIMITATIONS



                                      -25-
<PAGE>


SHALL APPLY WHETHER OR NOT A PARTY HAS BEEN ADVISED OF THE  POSSIBILITY  OF SUCH
DAMAGES  AND  NOTWITHSTANDING  ANY FAILURE OF  ESSENTIAL  PURPOSE OF ANY LIMITED
REMEDY PROVIDED HEREIN.

                                   ARTICLE 18
                                  MISCELLANEOUS

     18.1  Governing  Law.  This  Agreement II and any dispute  arising from the
performance  or breach hereof shall be governed by and construed and enforced in
accordance  with,  the laws of the State of  California,  without  reference  to
conflicts of laws principles.

     18.2 Disputes.

          18.2.1 Resolution.  In the event that the Joint Development Committee,
or Bioject  and  AngioSense,  are unable to resolve any  dispute  between  them,
either  Bioject or  AngioSense  may, by written  notice to the other,  have such
dispute referred to the Chief Executive  Officers (or equivalent) of Bioject and
AngioSense,   for  attempted   resolution  by  good  faith  negotiations  within
twenty-one (21) days after such notice is received.  Unless  otherwise  mutually
agreed, the negotiations  between the designated  officers shall be conducted by
telephone,  within  three (3) days and at times  within the period  stated above
offered by the designated  officers of AngioSense to the  designated  officer of
Bioject for consideration.

          18.2.2  Arbitration.  AngioSense and Bioject agree that any dispute or
controversy arising out of, in relation to, or in connection with this Agreement
II, or the validity, enforceability, construction, performance or breach hereof,
and not  settled  pursuant to Section  18.2.1  above shall be settled by binding
arbitration as set forth in Exhibit F.

     18.3  Force  Majeure.  Nonperformance  of any  party  (except  for  payment
obligations)  shall be  excused  to the  extent  that  performance  is  rendered
impossible by strike, fire,  earthquake,  flood,  governmental acts or orders or
restrictions,  delay or failure of suppliers,  or any other reason where failure
to  perform  is  beyond  the  reasonable  control  and not  caused  by the gross
negligence or willful misconduct of the nonperforming party.

     18.4 No  Implied  Waivers;  Rights  Cumulative.  No  failure on the part of
Bioject or  AngioSense  to exercise and no delay in  exercising  any right under
this  Agreement  II, or provided by statute or at law or in equity or otherwise,
shall impair,  prejudice or constitute a waiver of any such right, nor shall any
partial  exercise  of any such  right  preclude  any other or  further  exercise
thereof or the exercise of any other right.

     18.5  Independent  Contractors.  Nothing  contained in this Agreement II is
intended implicitly,  or is to be construed, to constitute Bioject or AngioSense
as  partners  in the legal  sense.  No party  hereto  shall have any  express or
implied right or authority to assume or create any  obligations  on behalf of or
in the  name of any  other  party or to bind any  other  party to any  contract,
agreement or undertaking with any third party.




                                      -26-
<PAGE>

     18.6  Notices.  All notices,  requests and other  communications  hereunder
shall be in writing and shall be  personally  delivered or sent by registered or
certified mail, return receipt requested,  postage prepaid,  in each case to the
respective address specified below, or such other address as may be specified in
writing to the other parties hereto:

                  AngioSense:           AngioSense, Inc
                                        2611 Knollwood Drive
                                        Cameron Park, California 95682
                                        Attn:  Robert C. Glines

                  with a copy to:       Wilson Sonsini Goodrich & Rosati
                                        Professional Corporation
                                        650 Page Mill Road
                                        Palo Alto, California 94304-1050
                                        Attn: Casey McGlynn, Esq.

                  Bioject:              Bioject, Inc.
                                        7620 S.W. Bridgeport Road
                                        Portland, Oregon  97224
                                        Attn: Chief Financial Officer

                  with a copy to:       Stoel Rivers LLP
                                        900 S.W. Fifth Avenue, Suite 2600
                                        Portland, Oregon  97204
                                        Attn:  Annette Mulee, Esq.


     18.7 Assignment.  This Agreement shall not be assignable by either party to
any third  party  without  the  written  consent of the other  party  hereto any
attempted  assignment  in violation of this Section 17.7 shall be null and void.
Notwithstanding  the foregoing,  AngioSense  may assign this  Agreement  without
Bioject's  consent to an entity that  acquires all or  substantially  all of its
business or assets whether by merger, acquisition,  or otherwise;  provided that
such entity does not generate ten percent  (10%) or more of its revenue from the
development,  manufacture or  distribution  of jet injection  technology (a "Jet
Injection  Entity").  Assignment to any Jet  Injection  Entity is subject to the
first sentence of this Section 18.7.

     18.8 Visiting  Personnel.  Certain  activities of the parties hereunder may
include  certain one  party's  personnel  including  without  limitation  senior
scientists  visiting and/or being stationed at the other party's  facilities for
some period of time; in such case such the visiting  personnel shall be bound by
all rules and regulations  pertaining to such facilities  during the time at the
facilities and each party shall be responsible for and assume all risk of injury
or damage done or suffered by its personnel when such personnel are at the other
party's  facilities,  except for injury or damage  caused by the  negligence  or
misconduct of the other party.



                                      -27-
<PAGE>

     18.9  Modification.  No amendment or  modification of any provision of this
Agreement II shall be effective  unless in writing signed by all parties hereto.
No provision of this Agreement II shall be varied,  contradicted or explained by
any oral agreement, course of dealing or performance or any other matter not set
forth in an agreement in writing and signed by all parties.

     18.10 Severability. If any provision hereof should be held invalid, illegal
or unenforceable in any  jurisdiction,  all other provisions hereof shall remain
in full force and effect in such  jurisdiction and shall be liberally  construed
in order to carry out the  intentions of the parties  hereto as nearly as may be
possible.  Such invalidity,  illegality or unenforceability shall not affect the
validity,   legality  or   enforceability   of  such   provision  in  any  other
jurisdiction.

     18.11  Publicity.  Each of the parties hereto agrees not to disclose to any
third  party the terms and  conditions  of this  Agreement  II without the prior
written  consent of the other party  hereto,  except to advisors,  investors and
others on a need-to-know  basis under  circumstances  that reasonably ensure the
confidentiality thereof, or to the extent required by law.

     18.12 Headings. Headings used herein are for convenience only and shall not
in any  way  affect  the  construction  of or be  taken  into  consideration  in
interpreting this Agreement II.

     18.13 No Implied  Licenses.  Except as expressly  provided herein, no party
hereto  grants to any other  party  hereto  any  rights or  licenses  under such
party's patent rights, trade secrets or other intellectual property rights.

     18.14 Entire Agreement.  This Agreement II, including the Exhibits attached
hereto,  constitutes  the entire  agreement  with respect to the subject  matter
hereof,   and  supersedes  all  prior  or   contemporaneous   understandings  or
agreements, whether written or oral, between Bioject and AngioSense with respect
to such subject matter.

     18.15  Counterparts.  This  Agreement  II may be  executed  in two or  more
counterparts,  each of  which  shall be  deemed  an  original,  and all of which
together, shall constitute one and the same instrument.





                                      -28-
<PAGE>



         IN WITNESS WHEREOF, the parties hereto have caused this Agreement II to
be duly executed and delivered effective as of the Effective Date.


Bioject, Inc.                         AngioSense, Inc.
("Bioject")                           ("AngioSense")


By: -------------------------------   By: -------------------------------

Name:  ----------------------------   Name: -----------------------------

Title: ----------------------------   Title: ----------------------------






                                      -29-
<PAGE>



         List of Exhibits:
         -----------------
         Exhibit A--Licensed Patents
         Exhibit B--Aject Development Plan
         Exhibit C--Milestone and Stock Purchase Schedule
         Exhibit D--Form of Stock Purchase Agreement
         Exhibit E--Transfer Pricing Schedule
         Exhibit F--Arbitration Procedures



<PAGE>



                                    EXHIBIT A

                                LICENSED PATENTS


<TABLE>

                         Patent       Docket
Date                     Number       Number        Country           Description                  Area of Protection
-----------------------------------------------------------------------------------------------------------------------------------
<S>                      <C>          <C>           <C>               <C>                           <C>
Jan 30, 1997             5782802      15466-011     USA               Multiple use needle-less     Apparatus
                                                                      hypodermic injection
                                                                      device for individual users

Aug 5, 1998              4966581      98019         USA

</TABLE>









<PAGE>


                          LICENSED PATENT APPLICATIONS

<TABLE>

Date                  Docket Number     Country     Description                                        Area of Protection
-----------------------------------------------------------------------------------------------------------------------------------
<S>                  <C>               <C>          <C>                                                <C>
***                  ***               ***          ***                                                ***

***                  ***               ***          ***                                                ***

***                  ***               ***          ***                                                ***
</TABLE>


<PAGE>


                                    EXHIBIT B

                                    EQUIPMENT



1.   All tooling and molds necessary for developing and  manufacturing the Iject
     and the  Aject  (alone  or as part of the  AngioSense  Product)  quantities
     sufficient to meet AngioSense's requirements.



<PAGE>



                                    EXHIBIT C

                               Milestone Schedule

In the  event  that  each  of the  following  three  (3)  milestones  (each,  an
"Iject/Aject  Milestone")  is achieved  by or before the due date listed  across
from such  Milestone  (each  such date,  an  "Iject/AjectMilestone  Due  Date"),
AngioSense shall issue to Bioject 277,222 shares of Common Stock pursuant to the
terms of the Stock Purchase  Agreement by and between Bioject and AngioSense and
of even date herewith (the "Stock  Purchase  Agreement"),  which Stock  Purchase
Agreement is attached as Exhibit D to the  Agreement.  If any one or more of the
Iject/Aject  Milestones is not achieved by the applicable  Iject/Aject Milestone
Due Date,  then the  condition  precedent to  AngioSense's  obligation  to issue
shares to Bioject  pursuant  to  Section 3 of the Stock  Purchase  Agreement  in
connection  with the Iject Product will not be met and AngioSense  shall have no
obligation  to issue any such  shares  pursuant  to such  Section 3.  Should the
milestones  not be achieved on a timely  basis,  Angiosense  shall issue 277,222
shares when the milestones are completed,  or decide to cancel the project,  and
Bioject's entire obligation under Agreement II will be cancelled.


<TABLE>
Iject/Aject Milestones                                                                        Due Date
--------------------------------------------------------------------------------------------------------
<S>                                                                                           <C>
1.   Provide AngioSense with three  intraoperative  prototype devices for use in             ***
     animal studies
2.   Use commercially  reasonable  efforts to assist  AngioSense,  as reasonably             ***
     requested,  prior to the Due Date in submitting 1st  regulatory  filing for
     the Aject device,  whether or not AngioSense submits any such filing by the
     Due Date.  Bioject shall not be held responsible for filing of AngioSense's
     regulatory submissions.
3.   Provide  necessary   information  and   documentation  to  AngioSense,   as             ***
     reasonably  requested  prior  to the  Due  Date,  for  filing  U.S.  patent
     application  for the Aject device,  whether or not  AngioSense  submits any
     such  filing by the Due Date.  Bioject  shall not be held  responsible  for
     filing of AngioSense's U.S. patent application.
</TABLE>





<PAGE>


                                    EXHIBIT E




Estimated Transfer Price Schedule


                                                   Annual Unit Purchases

<TABLE>
<S>                                                <C>        <C>        <C>         <C>         <C>         <C>
Device                                             5,000      10,000     20,000      50,000      75,000      100,000
---------------------------------------------------------------------------------------------------------------------
Aject (preliminary estimate based on current       ***        ***        ***         ***         ***         ***
configuration of Iject)
</TABLE>




*    ***



<PAGE>


                                    EXHIBIT F

                                   ARBITRATION


     (a) Initiation of Arbitration.  A party ("Complaining Party") which intends
to begin an arbitration to resolve a Dispute as  contemplated  by Section of the
Agreement  ("Arbitration")  shall initiate the Arbitration by providing  written
notice ("Arbitration Request") of such intent by certified or registered mail or
properly documented overnight delivery to the other party ("Responding  Party").
The Arbitration Request shall include a copy of the Description of Dispute,  set
forth a proposed  solution to the  Dispute,  and include a suggested  time frame
within  which the parties  must act to effect such  solution.  Contemporaneously
with sending the Arbitration  Request, the Complaining Party shall submit a copy
of the Arbitration Request to the American  Arbitration  Association in the city
in which the Arbitration is to be conducted as provided in Paragraph (d) below.

     (b) Selection of Arbitration.  Any and all Disputes to be resolved pursuant
to Arbitration shall be submitted to a neutral  arbitrator  ("Arbitrator").  The
parties shall select the  Arbitrator by mutual  agreement but if the parties are
unable to agree,  then the Arbitrator  shall be selected in accordance  with the
procedures of the American  Arbitration  Association.  The Arbitrator shall be a
former  judge of a state or  federal  court who shall not be a current or former
employee,  director or shareholder of, or otherwise have any current or previous
relationship with, either party or its respective affiliates.

     (c)  American  Arbitration  Association  Rules.  The  Arbitration  shall be
conducted in accordance with the rules of the American  Arbitration  Association
then in effect, subject to the time periods and other provisions of this Exhibit
or as otherwise set forth in the Agreement.

     (d) Hearing. Consistent with the time schedule established pursuant to this
paragraph  (d) and  Paragraph  (e) below,  the  Arbitrator  shall hold a hearing
("Hearing")  to resolve  each of the issues  identified  in the  Description  of
Dispute. To the extent practicable taking into account the nature of the Dispute
and the  availability of the  Arbitrator,  the Hearing shall be conducted over a
period not to exceed two (2) consecutive business days, with each party entitled
to  approximately  half of the  allotted  time unless  otherwise  ordered by the
Arbitrator.  The Hearing shall be conducted in a location to be mutually  agreed
by the parties.

     (e) Discovery.  Within ten (10) days of receipt by the Responding  Party of
the Arbitration  Request the parties shall negotiate in good faith the scope and
schedule of discovery,  including  depositions,  document  production  and other
discovery  devices,  taking into account the nature of the Dispute submitted for
resolution.  If the  parties are unable to reach  agreement  as to the scope and
schedule of  discovery,  the  Arbitrator  may order such  discovery as he or she
deems necessary.  In either case, such discovery shall be completed within sixty
(60) days from the date of the  selection  of the  Arbitrator.  At the  hearing,
which shall  commence  within twenty (20) days after the completion of discovery
unless the  Arbitrator  otherwise  orders,  the parties  may  present  testimony
(either  live  witness  or  deposition),   subject  to  cross-examination,   and
documentary evidence.



<PAGE>

     (f) Hearing  Submission.  At least twenty (20)  business  days prior to the
date  set for the  Hearing,  each  party  shall  submit  to each  other  and the
Arbitrator a list of all  documents  on which such party  intends to rely in any
oral or written  presentation at the Hearing,  a list of all witnesses,  if any,
such party  intends to call at the Hearing and a brief  summary of each witness'
testimony. At least five (5) business days prior to the Hearing, each party must
submit to the Arbitrator and serve on each other party proposed findings of fact
and  conclusions  of law on each  issue  to be  resolved.  Within  five (5) days
following  the  close  of  the  Hearing,  each  party  shall  each  submit  such
post-Hearing  briefs to the Arbitrator  addressing the evidence and issues to be
resolved as may be required or permitted by the Arbitrator.

     (g)  Arbitrator's  Duties and Authority.  The Arbitrator shall preside over
and resolve any disputes between the parties in connection with the Arbitration.
The Arbitrator  shall have sole discretion with regard to the  admissibility  of
any evidence and all other matters  relating to the conduct of the Hearing.  The
Arbitrator  shall,  in rendering its decision,  apply the substantive law of the
State of  California.  The  decision  of the  Arbitrator  shall be final and not
appealable,  except  in the  case  of  fraud  or bad  faith  on the  part of the
Arbitrator in connection with the conduct of such proceedings.

     (h) Decision and Award. The Arbitrator shall render a decision and award as
expeditiously  as possible  but in no event more than thirty (30) days after the
close of the  hearing.  In making  the award the  Arbitrator  shall rule on each
disputed  issue.  Nothing  contained  herein  shall be  construed  to permit the
Arbitrator or any court or any other forum to award  punitive,  exemplary or any
similar  damages.  By entering into the Agreement and exercising their rights to
arbitrate, the parties expressly waive any claim for punitive,  exemplary or any
similar  damages.   The  only  damages  recoverable  under  this  Agreement  are
compensatory damages.

     (i) Costs and  Expenses.  Each  party  shall pay its own costs  (including,
without limitation,  reasonable attorneys' fees) and expenses in connection with
the Arbitration;  provided,  however, that if the Arbitrator determines that the
action of any party was arbitrary, frivolous or in bad faith, the Arbitrator may
award such costs and expenses to the prevailing party.

     (j)  Confidentiality.  The Arbitration shall be confidential and, except as
required by law,  neither party shall make (or instruct the  Arbitrator to make)
any public  announcement  with  respect to the  proceedings  or  decision of the
Arbitrator  without the prior written consent of the other party.  The existence
of any Dispute, and the award of the Arbitrator,  shall be kept in confidence by
the  parties and the  Arbitrator,  except as  required  in  connection  with the
enforcement of such award or as otherwise required by applicable law.

     (k)  Jurisdiction to Enforce Award.  For the purposes of these  arbitration
provisions, the decision may be entered in any court of competent jurisdiction.

     (l) Exclusive Procedures. The procedures specified herein shall be the sole
and exclusive  procedures  for the  resolution  of Disputes  between the parties
which  are  expressly   identified  for  resolution  in  accordance  with  these
arbitration provisions.

<PAGE>

                                    EXHIBIT D



                                ANGIOSENSE, INC.

                            STOCK PURCHASE AGREEMENT



     THIS  AGREEMENT  ("Agreement")  is made this 21st day of  September,  1999,
between  AngioSense,  Inc., a Delaware  corporation (the "Company") and Bioject,
Inc., an Oregon corporation ("Bioject").

     The parties agree as follows:

     1.  Issuance  of Stock.  Upon (i) the  satisfaction  of certain  conditions
precedent  set out in  Section  3  below,  or (ii)  the  occurrence  of an event
contemplated by Section 4 hereof,  the Company hereby agrees to issue to Bioject
up to an aggregate  maximum of 277,222 shares of the Company's Common Stock (the
"Shares").

     2.  Consideration.  The  Shares  shall be issued in  consideration  for the
rights  granted and  performance  rendered  under that certain  Development  and
Supply  Agreement  between  the  Company  and  Bioject  of  even  date  herewith
("Agreement II").

     3. Issuance of Shares upon Iject Milestone  Achievement.  Upon execution of
this  Agreement  and  Agreement  II,  and the  achievement  of all of the  Iject
Milestones  (as such  term is  defined  in  Exhibit  C of  Agreement  II) by the
applicable  Iject  Milestone  Due Dates (as such term is defined in Exhibit C of
Agreement  II), the Company shall issue to Bioject all 277,222 of the Shares and
shall issue a duly executed  certificate  evidencing  such shares in the name of
Bioject.

     4.  Issuance  of Shares  upon  Change  in  Control.  In the  event of,  and
immediately prior to the closing (the "Closing") of, the merger or consolidation
of the Company with or into another corporation, entity or person or the sale of
all or substantially all of the Company's assets to another corporation,  entity
or person,  the Company shall issue to Bioject (A) the number of the Shares that
would be issuable  pursuant to Section 3 hereof if all  conditions  precedent to
such issuance under Section 3 were satisfied, provided that (x) the Closing date
is no later than the latest Iject  Milestone Due Date and (y) none of the Shares
issuable  pursuant to Section 3 have been issued pursuant to Section 3 as of the
Closing date, all provided,  however, that the Company shall not be obligated to
issue any shares  pursuant to this Section 4 if  immediately  after such merger,
consolidation  or sale of assets,  more than 50% of the capital  stock or equity
interests in such other  corporation,  entity or person are owned by persons who
owned in the  aggregate  more than 50% of the capital  stock of the  corporation
immediately before such merger, consolidation or sale of assets.

     5. Rights  Agreement.  Bioject  and the  Company  shall enter into a Rights
Agreement,  a form of which is attached hereto as Exhibit A,  concurrently  with
the execution of this Agreement.



<PAGE>

     6.  Representations  and Warranties of the Company.  The Company represents
and  warrants  to  Bioject  that as of the  date of this  Agreement,  except  as
otherwise set forth on the Schedule of Exceptions  attached  hereto as Exhibit B
setting forth the exceptions which correspond to the numbered sections contained
in this Section 6.

          6.1. Organization and Standing; Certificate and Bylaws. The Company is
a corporation duly organized,  validly existing,  and in good standing under the
laws of the State of Delaware. The Company has all requisite corporate power and
authority  to own and  operate  its  properties  and  assets and to carry on its
business as presently conducted and as proposed to be conducted.  The Company is
qualified to do business as a foreign  corporation in each jurisdiction in which
such  qualification  is required and where failure to be so qualified  would not
have a material adverse effect on the Company's  business as now conducted or as
proposed to be conducted.

          6.2.  Corporate  Power.  The  Company  has  all  requisite  legal  and
corporate  power to execute and deliver  this  Agreement,  to sell and issue the
Shares hereunder and to carry out and perform its obligations under the terms of
this Agreement.

          6.3.  Capitalization.  The  authorized  capital  stock of the  Company
consists of 20,000,000  shares of Common  Stock,  $0.001 par value and 2,750,000
shares of Preferred  Stock,  750,000 of which are designated  Series A Preferred
Stock with a par value of $0.001 per share and 2,000,000 of which are designated
Series B Preferred  Stock with a par value of $0.001 per share.  The outstanding
capital stock of the Company as of the date of this Agreement is as set forth in
Section 6.3 of the Schedule of Exceptions.  All issued and outstanding shares of
the Company's  capital stock have been duly authorized and validly  issued,  are
fully paid and  nonassessable,  and were issued in  compliance  with  applicable
federal  and state  securities  laws.  Except as set forth in Section 6.3 of the
Schedule of Exceptions,  there are no other outstanding  shares of capital stock
or  outstanding  rights of first  refusal,  preemptive  rights or other  rights,
options,  warrants,  conversion  rights,  or other agreements either directly or
indirectly for the purchase or acquisition from the Company of any shares of its
capital stock.

          6.4.  Subsidiaries.  The Company  has no  subsidiaries  or  affiliated
companies  and does not otherwise own or control,  directly or  indirectly,  any
equity interest in any corporation, association or business entity.

          6.5.  Authorization.  All corporate action on the part of the Company,
its  officers,  directors  and  stockholders  necessary  for the  authorization,
execution,  delivery  and  performance  by the  Company of this  Agreement,  the
authorization, issuance, sale and delivery of the Shares, and the performance of
all of the Company's obligations hereunder has been taken or will be taken prior
to the execution of this Agreement.  This Agreement, when executed and delivered
by the Company,  shall constitute a valid and legally binding  obligation of the
Company enforceable in accordance with its respective terms,  subject to laws of
general application relating to bankruptcy, insolvency and the relief of debtors
and rules of law  governing  specific  performance,  injunctive  relief or other
equitable remedies. The Shares, when issued in compliance with the provisions of
this Agreement,  will be validly issued,  fully paid and nonassessable,  and the
Shares  will  be free of any  liens  or  encumbrances  created  by the  Company,
provided,  however,  that the Shares may be subject to  restrictions on transfer
under applicable securities laws as set forth herein.



                                      -2-
<PAGE>

          6.6.  Title  to  Properties  and  Assets.  The  Company  has  good and
marketable  title to its tangible  properties and assets,  and has good title to
all its leasehold interests, in each case subject to no mortgage,  pledge, lien,
lease, loan, encumbrance or charge, except (i) the lien of current taxes not yet
due and payable,  and (ii) possible minor liens and encumbrances which do not in
any case  materially  detract from the value of the property  subject thereto or
materially impair the Company's operations,  and which have not arisen otherwise
than in the ordinary course of business. With respect to property it leases, the
Company is in compliance with such leases in all material respects.

          6.7.  Compliance  with  Other  Instruments.  The  Company  is  not  in
violation of any term of its Certificate of Incorporation or Bylaws. The Company
is not in violation of, or in default in any material  respect under,  the terms
of any mortgage, indenture, contract, agreement,  instrument, judgment or decree
applicable to it or to which it is a party,  the violation of which would have a
material  adverse  effect on the  Company as a whole,  and the Company is not in
violation of any order,  statute,  rule or regulation applicable to the Company,
the violation of which would have a material adverse effect on the Company.

          6.8.  Litigation.  There is no  action,  proceeding  or  investigation
pending,  or to  Company's  knowledge  threatened,  against  the  Company or its
officers,  directors or stockholders,  or, to the Company's  knowledge,  against
employees or consultants of the Company which might result,  either individually
or in the aggregate, in any material adverse change in the business,  prospects,
conditions,  affairs or operations of the Company. The Company is not a party to
or subject to the provisions of any order, writ, injunction,  judgment or decree
of any court or government agency or instrumentality.  There is no action, suit,
proceeding  or  investigation  by the  Company  currently  pending  or which the
Company currently intends to initiate.

          6.9. Governmental  Consents. No consent,  approval or authorization of
or  designation,  declaration or filing with any  governmental  authority on the
part of the Company is  required  in  connection  with the valid  execution  and
delivery of this Agreement,  or the offer, sale or issuance of the Shares except
qualification  (or taking such action as may be necessary to secure an exemption
from  qualification,  if  available)  of the offer and sale of the Shares  under
applicable Blue Sky laws, which filings and qualifications, if required, will be
accomplished in a timely manner.

          6.10. Brokers or Finders.  The Company has not incurred,  and will not
incur,  directly or indirectly,  as a result of any action taken by or on behalf
of the  Company,  any  liability  for  brokerage  or  finders'  fees or  agents'
commissions or any similar charges in connection with this Agreement.

          6.11.  Financial  Statements.  The Company has furnished  Bioject with
copies of all financial  statements of the Company available to the Company, and
the current version of the Company's business plan, as of June 21, 1999.

     7. Investment Representations; Restriction on Transfer.

          (a) In connection with the purchase of the Shares,  Bioject represents
to the Company the following:



                                      -3-
<PAGE>

               (i)  Bioject  is  aware of the  Company's  business  affairs  and
financial condition and has acquired sufficient information about the Company to
reach an informed and knowledgeable decision to acquire the securities.  Bioject
is purchasing  these  securities for investment for its own account only and not
with a view to, or for resale in connection  with,  any  "distribution"  thereof
within the meaning of the Securities Act of 1933 (the "Securities Act").

               (ii) Bioject is an Accredited  Investor,  as that term is defined
in Regulation D of the Securities Act.

               (iii)  Bioject  understands  that  the  securities  have not been
registered under the Securities Act by reason of a specific exemption therefrom,
which  exemption  depends  upon,  among  other  things,  the bona fide nature of
Bioject's  investment intent as expressed  herein.  In this connection,  Bioject
understands   that,  in  view  of  the   Securities   and  Exchange   Commission
("Commission"),  the  statutory  basis for such  exemption may not be present if
Bioject's  representations  meant that its present  intention  was to hold these
securities  for a minimum  capital  gains period under the tax  statutes,  for a
deferred sale, for a market rise, for a sale if the market does not rise, or for
a year or any other fixed period in the future.

               (iv)  Bioject  further  acknowledges  and  understands  that  the
securities must be held  indefinitely  unless they are  subsequently  registered
under the Securities Act or an exemption  from such  registration  is available.
Bioject  further  acknowledges  and  understands  that the  Company  is under no
obligation to register the securities.  Bioject understands that the certificate
evidencing  the securities  will be imprinted with a legend which  prohibits the
transfer of the securities  unless they are registered or such  registration  is
not required in the opinion of counsel for the Company.

               (v)  Bioject  is  aware  of  the  adoption  of  Rule  144  by the
Commission,  promulgated  under the Securities Act, which permits limited public
resale  of  securities   acquired  in  a  non-public  offering  subject  to  the
satisfaction of certain conditions.

               (vi) Bioject  further  acknowledges  that in the event all of the
requirements of Rule 144 are not met, compliance with Regulation A or some other
registration  exemption  will be  required,  and that  although  Rule 144 is not
exclusive,  the staff of the  Commission  has expressed its opinion that persons
proposing  to sell  private  placement  securities  other  than in a  registered
offering and other than pursuant to Rule 144 will have a  substantial  burden of
proof in establishing  that an exemption from registration is available for such
offers or sales and that such  persons and the brokers  who  participate  in the
transactions do so at their own risk.

          (b) Bioject  agrees,  provided  that the officers and directors of the
Company agree to be bound by terms substantially identical to those contained in
this subsection  7(b), in connection with the Company's  initial public offering
of the  Company's  securities,  upon request of the Company or the  underwriters
managing any underwritten offering of the Company's Securities, (i) not to sell,
make any short sale of, loan, grant any option for the purchase of, or otherwise
dispose of any shares of Common Stock of the Company held by Bioject (other than
those shares included in the registration)  without the prior written consent of
the  Company or such  underwriters,  as the case may be, for such period of time
(not to exceed one hundred eighty (180) days) from the effective date of such



                                      -4-
<PAGE>

registration as may be requested by the  underwriters and (ii) further agrees to
execute  any  agreement  reflecting  (i)  above  as  may  be  requested  by  the
underwriters at the time of the public offering.

     8. Legends.  The share  certificate  evidencing the Shares issued hereunder
shall be endorsed with the following legends:

          (a) THE SHARES  REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN  REGISTERED  UNDER THE SECURITIES ACT OF 1933. SUCH
SHARES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION UNLESS
THE  TRANSFER  IS IN  ACCORDANCE  WITH RULE 144 OR  SIMILAR  RULE OR UNLESS  THE
COMPANY RECEIVES AN OPINION OF COUNSEL REASONABLY  ACCEPTABLE TO IT STATING THAT
SUCH SALE OR TRANSFER IS EXEMPT FROM THE  REGISTRATION  AND PROSPECTUS  DELIVERY
REQUIREMENTS OF SAID ACT. COPIES OF THE AGREEMENT COVERING THE PURCHASE OF THESE
SHARES AND  RESTRICTING  THEIR  TRANSFER  MAY BE  OBTAINED AT NO COST BY WRITTEN
REQUEST MADE BY THE HOLDER OF RECORD OF THIS CERTIFICATE TO THE SECRETARY OF THE
CORPORATION AT THE PRINCIPAL EXECUTIVE OFFICES OF THE CORPORATION.

          (b)  Any  legend  required  to be  placed  thereon  by the  California
Commissioner of Corporations or any other applicable state securities laws.

     9.  Adjustment for Stock Split.  All references to the number of Shares and
the  purchase  price of the  Shares  in this  Agreement  shall be  appropriately
adjusted  to reflect any stock  split,  stock  dividend  or other  change in the
Shares which may be made by the Company after the date of this Agreement.

     10. General Provisions.

          (a) This Agreement shall be governed by the internal laws of the State
of  California.  This  Agreement  represents  the entire  agreement  between the
parties with  respect to the purchase of Common Stock by Bioject and  supersedes
any prior agreement written or oral with respect to the purchase of Common Stock
by Bioject and satisfies all of the Company's obligations to Bioject with regard
to the issuance or sale of  securities.  This  Agreement may only be modified or
amended in writing signed by both parties.

          (b) Any notice, demand or request required or permitted to be given by
either the Company or Bioject  pursuant to the terms of this Agreement  shall be
in writing and shall be deemed given when  delivered  personally or deposited in
the U.S. mail, First Class with postage prepaid, and addressed to the parties at
the  addresses  of the  parties set forth at the end of this  Agreement  or such
other address as a party may request by notifying the other in writing.

          (c) The rights and benefits of the Company under this Agreement  shall
be  transferable  to any one or more persons or entities,  and all covenants and
agreements  hereunder  shall inure to the benefit of, and be  enforceable by the
Company's successors and assigns. The rights and



                                      -5-
<PAGE>

obligations  of Bioject under this Agreement may only be assigned with the prior
written consent of the Company.

          (d) Either  party's  failure to enforce any provision or provisions of
this  Agreement  shall  not in any way be  construed  as a  waiver  of any  such
provision or provisions,  nor prevent that party  thereafter from enforcing each
and every other  provision of this  Agreement.  The rights  granted both parties
herein are  cumulative and shall not constitute a waiver of either party's right
to assert all other legal remedies available to it under the circumstances.

          (e) Bioject  agrees upon  request to execute any further  documents or
instruments  necessary  or desirable to carry out the purposes or intent of this
Agreement.

          (f)  Bioject  understands  that it  (and  not the  Company)  shall  be
responsible for its own federal,  state,  local or foreign tax liability and any
of its other  tax  consequences  that may arise as a result of the  transactions
contemplated by this Agreement.  Bioject shall rely solely on the determinations
of its tax  advisors or its own  determinations,  and not on any  statements  or
representations by the Company or any of its agents, with regard to all such tax
matters.

          (g) This Agreement may be executed in any number of counterparts, each
of which shall be deemed an original and all of which together shall  constitute
one and the same instrument.



                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]









                                      -6-
<PAGE>

IN WITNESS WHEREOF,  the parties have duly executed this Agreement as of the day
and year first set forth above.



ANGIOSENSE, INC.                       BIOJECT, INC.
a Delaware corporation                 an Oregon corporation

By: -------------------------------   By: -------------------------------

Title: ----------------------------   Title: -------------------------------


-----------------------------------   -----------------------------------
(Address)                             (Address)

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


<PAGE>



                                    EXHIBIT A

                                RIGHTS AGREEMENT



     This Rights  Agreement  ("Agreement") is entered into as of September 21st,
1999 by and between AngioSense, Inc., a Delaware corporation (the "Company") and
Bioject, Inc., an Oregon corporation ("Bioject").

     WHEREAS, Bioject and the Company are entering into (i) an Exclusive License
Agreement  (referred to as "Agreement  I") and,  (ii) a  Development  and Supply
Agreement  (referred to as "Agreement  II"),  both of even date  herewith  (such
agreements together, the "IP Agreements");

     WHEREAS, Bioject and the Company are entering into a total of two (2) stock
purchase agreements of even date with this Agreement (the "Purchase Agreements")
in connection with and concurrently with the execution of the IP Agreements; and

     WHEREAS, to induce Bioject to enter into the IP Agreements and the Purchase
Agreements,  the Company and Bioject have agreed to enter into this Agreement to
provide for certain rights, privileges and preferences in favor of Bioject.

     NOW,  THEREFORE,  in  consideration  of the  foregoing  and  of the  mutual
promises  and  covenants  contained  herein,  the parties  agree as follows:

     1. Certain  Definitions.  All terms not otherwise defined in this Agreement
shall have the meaning defined in the Stock Purchase Agreements. As used in this
Agreement, the following terms shall have the following respective meanings:

          1.1 "Commission" shall mean the Securities and Exchange  Commission or
any other federal agency at the time administering the Securities Act.

          1.2 "Holder"  shall mean Bioject and any person holding Shares to whom
the rights under this Agreement have been transferred in accordance with Section
3.7 hereof.

          1.3 "Registrable  Securities" means Common Stock of the Company issued
pursuant to the Purchase  Agreements  or other  securities  convertible  into or
exercisable   for  Common   Stock  upon  any  stock   split,   stock   dividend,
recapitalization,  or similar event,  provided,  however,  that shares of Common
Stock or other  securities  shall only be treated as Registrable  Securities for
the purposes of this  Agreement (A) if and so long as they have not been sold to
or  through  a broker or dealer or  underwriter  in a public  distribution  or a
public  securities  transaction,  or (B) prior to the date such  securities have
been sold or are all available  for immediate  sale in the opinion of counsel to
the Company in a transaction exempt from the prospectus delivery requirements of
the  Securities Act so that all transfer  restrictions  and legends with respect
thereto are removed upon the consummation of such sale. 1.4

<PAGE>

          1.4 The terms "register,"  "registered" and "registration"  refer to a
registration  effected  by  preparing  and filing a  registration  statement  in
compliance  with the  Securities  Act,  and the  declaration  or ordering of the
effectiveness of such registration statement.

          1.5  "Registration  Expenses"  shall  mean  all  expenses,  except  as
otherwise  stated below,  incurred by the Company in complying  with Section 3.1
hereof,  including,  without  limitation,  all  registration,  qualification and
filing fees,  printing expenses,  escrow fees, fees and disbursements of counsel
for the Company,  blue sky fees and expenses,  the expense of any special audits
incident to or required by any such registration (but excluding the compensation
of regular  employees  of the  Company  which  shall be paid in any event by the
Company).

          1.6 "Restricted  Securities"  shall mean the securities of the Company
required to bear the legend set forth in Section 2.2 hereof.

          1.7  "Securities  Act"  shall  mean 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.

          1.8 "Selling Expenses" shall mean all underwriting discounts,  selling
commissions  and  stock  transfer  taxes  and costs of  special  counsel  to the
Holders,  if any,  applicable to the  securities  registered by the Holders.

     2. Transferability.

          2.1  Restrictions  on  Transferability.  The Shares shall not be sold,
assigned,  transferred or pledged  except upon the conditions  specified in this
Section  2,  which  conditions  are  intended  to  ensure  compliance  with  the
provisions of the  Securities  Act.  Bioject will cause any proposed  purchaser,
assignee,  transferee, or pledgee of the Shares held by Bioject to agree to take
and hold such  securities  subject  to the  provisions  and upon the  conditions
specified in this Section 2.

          2.2 Restrictive Legend.  Each certificate  representing (i) the Shares
and (ii) any other  securities  issued in respect  of the Shares  upon any stock
split, stock dividend, recapitalization, merger, consolidation or similar event,
shall  (unless  otherwise  permitted by the  provisions of Section 2.3 below) be
stamped or otherwise  imprinted with a legend in the following form (in addition
to any legend required under applicable state securities laws):

     THE  SHARES   REPRESENTED  BY  THIS  CERTIFICATE  HAVE  BEEN  ACQUIRED  FOR
INVESTMENT AND HAVE NOT BEEN  REGISTERED  UNDER THE SECURITIES ACT OF 1933. SUCH
SHARES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION UNLESS
THE  TRANSFER  IS IN  ACCORDANCE  WITH RULE 144 OR  SIMILAR  RULE OR UNLESS  THE
COMPANY RECEIVES AN OPINION OF COUNSEL REASONABLY  ACCEPTABLE TO IT STATING THAT
SUCH SALE OR TRANSFER IS EXEMPT FROM THE  REGISTRATION  AND PROSPECTUS  DELIVERY
REQUIREMENTS OF SAID ACT. COPIES OF THE AGREEMENT COVERING THE PURCHASE OF THESE
SHARES AND  RESTRICTING  THEIR  TRANSFER  MAY BE  OBTAINED AT NO COST BY WRITTEN
REQUEST MADE BY THE HOLDER OF RECORD OF THIS CERTIFICATE TO




                                      -2-
<PAGE>

THE  SECRETARY OF THE  CORPORATION  AT THE  PRINCIPAL  EXECUTIVE  OFFICES OF THE
CORPORATION.

     Bioject consents to the Company making a notation on its records and giving
instructions  to any  transfer  agent of the  Shares in order to  implement  the
restrictions  on transfer  established in this Section 2.

          2.3  Notice of  Proposed  Transfers.  The  holder of each  certificate
representing Restricted Securities by acceptance thereof agrees to comply in all
respects with the  provisions of this Section 2.3.  Prior to any proposed  sale,
assignment,  transfer or pledge of any Restricted  Securities  (other than (i) a
transfer not involving a change in beneficial  ownership,  or (ii) a transfer to
an affiliated  fund,  partnership  or company,  which is not a competitor of the
Company,  subject  to  compliance  with  applicable  securities  laws,  or (iii)
transfers in compliance  with Rule 144, so long as the Company is furnished with
satisfactory evidence of compliance with such Rule), unless there is in effect a
registration  statement under the Securities Act covering the proposed transfer,
the holder  thereof  shall give written  notice to the Company of such  holder's
intention to effect such transfer,  sale, assignment or pledge. Each such notice
shall  describe the manner and  circumstances  of the proposed  transfer,  sale,
assignment or pledge in sufficient  detail,  and shall be  accompanied,  at such
holder's  expense by either (i) an unqualified  written opinion of legal counsel
who shall,  and whose legal opinion  shall,  be reasonably  satisfactory  to the
Company, which opinion shall be addressed to the Company and which opinion shall
be to the effect that the proposed transfer of the Restricted  Securities may be
effected  without  registration  under the Securities Act, or (ii) a "no action"
letter from the  Commission  to the effect that the transfer of such  securities
without  registration  will not result in a  recommendation  by the staff of the
Commission  that action be taken with respect  thereto,  whereupon the holder of
such  Restricted  Securities  shall be  entitled  to  transfer  such  Restricted
Securities in accordance with the terms of the notice delivered by the holder to
the Company. Each certificate  evidencing the Restricted Securities  transferred
as above provided  shall bear,  except if such transfer is made pursuant to Rule
144, the appropriate  restrictive legend set forth in Section 2.2 above,  except
that such certificate  shall not bear such restrictive  legend if in the opinion
of counsel for such  holder and in the  reasonable  opinion of the Company  such
legend is not required in order to establish  compliance  with any  provision of
the Securities Act.

          2.4 Removal of  Restrictions  on Transfer  of  Securities.  Any legend
referred to in Section 2.2 hereof  stamped on a certificate  evidencing  (i) the
Shares, (ii) any other securities issued in respect of the Shares upon any stock
split, stock dividend, recapitalization,  merger, consolidation or similar event
and the stock transfer  instructions  and record  notations with respect to such
security shall be removed and the Company shall issue a certificate without such
legend to the holder of such security if such  security is registered  under the
Securities  Act,  or if such  holder  provides  the  Company  with an opinion of
counsel  (which may be counsel for the  Company)  reasonably  acceptable  to the
Company to the effect that a public sale or  transfer  of such  security  may be
made without registration under the Securities Act or (iii) such holder provides
the Company with reasonable assurances, which may, at the option of the Company,
include an opinion of counsel  satisfactory  to the Company,  that such security
can be sold pursuant to Section (k) of Rule 144 under the Securities Act.




                                      -3-
<PAGE>





     3. Registration Rights.

          3.1 Company Registration.

               (a) Notice of  Registration.  If at any time or from time to time
the Company shall  determine to register any of its  securities,  either for its
own  account or the account of a security  holder or  holders,  other than (i) a
registration  relating  solely to employee  benefit  plans,  (ii) a registration
relating  solely to a Commission  Rule 145  transaction  or (iii) a registration
relating to the initial underwritten public offering of the Company's securities
pursuant to a registration statement filed under the Securities Act:

                    (i) promptly give to each Holder written notice thereof; and

                    (ii)   include  in  such   registration   (and  any  related
qualification under blue sky laws or other compliance),  and in any underwriting
involved therein, all the Registrable  Securities specified in a written request
or requests,  made within 10 days after receipt of such written  notice from the
Company, by any Holder.


               (b) Underwriting.  If the registration of which the Company gives
notice is for a  registered  public  offering  involving  an  underwriting,  the
Company  shall so advise  the  Holders  as a part of the  written  notice  given
pursuant  to  Section  3.1(a)(i).  In such  event  the  right of any  Holder  to
registration  pursuant  to this  Section  3.1  shall be  conditioned  upon  such
Holder's  participation  in such  underwriting  and the inclusion of Registrable
Securities  in the  underwriting  to the extent  provided  herein.  All  Holders
proposing  to  distribute  their  securities  through  such  underwriting  shall
(together  with the Company) enter into an  underwriting  agreement in customary
form  with  the  managing  underwriter  selected  for such  underwriting  by the
Company.  Notwithstanding  any  other  provision  of this  Section  3.1,  if the
managing  underwriter  determines that marketing factors require a limitation of
the number of shares to be underwritten,  the managing underwriter may limit the
Registrable  Securities  and other  securities  to be  distributed  through such
underwriting to (i) in the case of the first underwritten public offering of the
securities of the Company,  any amount or no amount, as the managing underwriter
may determine,  or (ii) in the case of any registration  subsequent to the first
underwritten  public offering of the securities of the Company, to not less than
thirty three percent (33%) of the total securities  covered by the registration.
The Company shall so advise all Holders  distributing  their securities  through
such  underwriting  of such  limitation  and the number of shares of Registrable
Securities that may be included in the registration  and  underwriting  shall be
allocated  among all Holders in  proportion,  as nearly as  practicable,  to the
respective amounts of Registrable Securities held by such Holders at the time of
filing the  registration  statement.  To facilitate  the allocation of shares in
accordance with the above provisions, the Company may round the number of shares
allocated  to any Holder or holder to the nearest  100 shares.  If any Holder or
holder disapproves of the terms of any such underwriting,  such Holder or holder
may  elect to  withdraw  therefrom  by  written  notice to the  Company  and the
managing   underwriter.   Any   securities   excluded  or  withdrawn  from  such
underwriting  shall be  withdrawn  from  such  registration,  and  shall  not be
transferred in a public  distribution  prior to 90 days after the effective date
of the registration  statement relating thereto, or such other shorter period of
time as the underwriters may require.



                                      -4-
<PAGE>

               (c) Right to Terminate  Registration.  The Company shall have the
right to  terminate  or withdraw  any  registration  initiated  by it under this
Section 3.1 prior to the effectiveness of such  registration  whether or not any
Holder has elected to include securities in such registration.  The Registration
Expenses  of such  withdrawn  registration  shall  be borne  by the  Company  in
accordance with Section 3.2 hereof.

          3.2 Expenses of Registration.  All Registration  Expenses  incurred in
connection  with  registrations  pursuant  to Section  3.1 shall be borne by the
Company. All Selling Expenses relating to securities registered on behalf of the
Holders  shall  be  borne  by  the  holders  of  securities   included  in  such
registration  pro rata with the Company and among each other on the basis of the
number of shares so registered.

          3.3  Registration  Procedures.  In  the  case  of  each  registration,
qualification or compliance  effected by the Company pursuant to this Section 3,
the Company  will keep each Holder  advised in writing as to the  initiation  of
each  registration,  qualification  and  compliance  and  as to  the  completion
thereof. At its expense the Company will:

               (a) Prepare and file with the Commission a registration statement
with  respect  to such  securities  and use  its  best  efforts  to  cause  such
registration  statement to become and remain effective for the lesser of (i) one
hundred   eighty  (180)  days  and  (ii)  the  time  required  to  complete  the
distribution described in the registration statement;

               (b)  Prepare and file with the  Commission  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 participating in such registration and
to the underwriters of the securities being registered such reasonable number of
copies of the registration statement,  preliminary prospectus,  final prospectus
and such other documents as such underwriters may reasonably request in order to
facilitate the public offering of such securities.

               (d) Furnish, at the request of any Holder requesting registration
of Registrable  Securities  that are delivered to the  underwriters  for sale in
connection  with a  registration  pursuant to this  Section 3.3, (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 accountants of the Company, in form
and substance as is customarily given by independent accountants to underwriters
in an underwritten public offering,  addressed to the underwriters,  if any, and
to the Holders requesting registration of Registrable Securities.

          3.4 Indemnification.

               (a) The Company will indemnify each Holder, each of its officers,
directors,  partners and legal counsel,  and each person controlling such Holder
within the meaning of




                                      -5-
<PAGE>

Section  15  of  the  Securities  Act,  with  respect  to  which   registration,
qualification  or compliance  has been effected  pursuant to this Section 3, and
each  underwriter,  if any, and each person who controls any underwriter  within
the meaning of Section 15 of the Securities Act,  against all expenses,  claims,
losses, damages or liabilities (or actions in respect thereof), including any of
the foregoing incurred in settlement of any litigation, commenced or threatened,
arising out of or based on any untrue statement (or alleged untrue statement) of
a material fact contained in any registration  statement,  prospectus,  offering
circular or other document, or any amendment or supplement thereto,  incident to
any such registration, qualification or compliance, or based on any omission (or
alleged omission) to state therein a material fact required to be stated therein
or necessary to make the statements  therein,  in light of the  circumstances in
which they were made,  not  misleading,  or any  violation by the Company of the
Securities  Act or any rule or regulation  promulgated  under the Securities Act
applicable   to  the  Company  in   connection   with  any  such   registration,
qualification  or  compliance,  and the Company will reimburse each such Holder,
each of its  officers,  directors,  partners,  and legal counsel and each person
controlling such Holder,  each such underwriter and each person who controls any
such underwriter,  for any legal and any other expenses  reasonably  incurred in
connection  with  investigating,  preparing or defending  any such claim,  loss,
damage, liability or action, provided that the Company will not be liable in any
such case to the extent that any such claim, loss, damage,  liability or expense
arises out of or is based on any untrue  statement or omission or alleged untrue
statement  or omission,  made in reliance  upon and in  conformity  with written
information  furnished  to the Company by an  instrument  duly  executed by such
Holder,  controlling person or underwriter and stated to be specifically for use
therein.

               (b) Each Holder  will,  if  Registrable  Securities  held by such
Holder  are  included  in  the   securities  as  to  which  such   registration,
qualification  or compliance is being effected,  indemnify the Company,  each of
its directors,  officers,  and legal counsel,  each underwriter,  if any, of the
Company's securities covered by such a registration  statement,  each person who
controls the Company or such underwriter within the meaning of Section 15 of the
Securities Act, and each other Holder, each of its officers, directors, partners
and legal counsel and each person  controlling such Holder within the meaning of
Section 15 of the  Securities  Act,  against  all  claims,  losses,  damages and
liabilities  (or  actions in  respect  thereof)  arising  out of or based on any
untrue  statement (or alleged untrue  statement) of a material fact contained in
any  such  registration  statement,   prospectus,  offering  circular  or  other
document, or any omission (or alleged omission) to state therein a material fact
required to be stated  therein or necessary to make the  statements  therein not
misleading,  and will  reimburse  the Company,  such  Holders,  such  directors,
officers,  persons,  underwriters  or control persons for any legal or any other
expenses  reasonably  incurred in connection with investigating or defending any
such claim, loss,  damage,  liability or action, in each case to the extent, but
only to the extent,  that such untrue statement (or alleged untrue statement) or
omission  (or  alleged  omission)  is  made  in  such  registration   statement,
prospectus,  offering  circular  or  other  document  in  reliance  upon  and in
conformity  with written  information  furnished to the Company by an instrument
duly  executed by such  Holder and stated to be  specifically  for use  therein.
Notwithstanding  the  foregoing,   the  liability  of  each  Holder  under  this
subsection  (b) shall be limited in an amount equal to the proceeds to each such
Holder of  Registrable  Securities  sold as  contemplated  herein,  unless  such
liability  resulted from willful misconduct by such Holder. A Holder will not be
required to enter into any  agreement  or  undertaking  in  connection  with any
registration under this Section 3 providing for





                                      -6-
<PAGE>

any  indemnification or contribution on the part of such Holder greater than the
Holder's  obligations  under this  Section  3.4(b).

               (c) Each party entitled to indemnification under this Section 3.4
(the  "Indemnified  Party")  shall give notice to the party  required to provide
indemnification (the "Indemnifying Party") promptly after such Indemnified Party
has actual knowledge of any claim as to which indemnity may be sought, and shall
permit the  Indemnifying  Party to assume  the  defense of any such claim or any
litigation  resulting  therefrom,  provided  that  counsel for the  Indemnifying
Party,  who shall  conduct  the  defense of such claim or  litigation,  shall be
approved by the  Indemnified  Party (whose  approval shall not  unreasonably  be
withheld),  and the  Indemnified  Party may  participate in such defense at such
party's expense,  and provided further that the failure of any Indemnified Party
to give notice as provided  herein shall not relieve the  Indemnifying  Party of
its  obligations  under this Section 3 unless the failure to give such notice is
materially  prejudicial to an Indemnifying Party's ability to defend such action
and provided further,  that the Indemnifying  Party shall not assume the defense
for  matters  as to which  there is a  conflict  of  interest  or  separate  and
different defenses but shall bear the expense of such defense  nevertheless.  No
Indemnifying  Party,  in the  defense  of any such claim or  litigation,  shall,
except  with the  consent  of each  Indemnified  Party,  consent to entry of any
judgment or enter into any settlement which does not include as an unconditional
term thereof the giving by the claimant or plaintiff to such  Indemnified  Party
of a release from all liability in respect to such claim or litigation.

          3.5  Information  by Holder.  The  Holder or  Holders  of  Registrable
Securities  included  in any  registration  shall  furnish to the  Company  such
information regarding such Holder or Holders, the Registrable Securities held by
them and the distribution  proposed by such Holder or Holders as the Company may
request in writing and as shall be required in connection with any registration,
qualification or compliance referred to in this Section 3.

          3.6 Rule 144 Reporting.  With a view to making  available the benefits
of certain rules and regulations of the Commission  which may at any time permit
the sale of the Restricted Securities to the public without registration,  after
such time as a public  market  exists for the Common Stock of the  Company,  the
Company agrees to use its best efforts to:

               (a) Make and keep public  information  available,  as those terms
are understood  and defined in Rule 144 under the  Securities  Act, at all times
after the  effective  date that the  Company  becomes  subject to the  reporting
requirements  of the Securities  Act or the Securities  Exchange Act of 1934, as
amended.

               (b) Use its best efforts to file with the  Commission in a timely
manner  all  reports  and other  documents  required  of the  Company  under the
Securities Act and the Securities  Exchange Act of 1934, as amended (at any time
after it has become subject to such reporting requirements);

               (c) So long as a  Purchaser  owns any  Restricted  Securities  to
furnish to the  Purchaser  forthwith  upon  request a written  statement  by the
Company as to its compliance  with the reporting  requirements  of said Rule 144
(at any time after 90 days after the  effective  date of the first  registration
statement  filed by the Company for an offering of its securities to the general
public),




                                      -7-
<PAGE>


and of the Securities  Act and the Securities  Exchange Act of 1934 (at any time
after it has become subject to such reporting requirements),  a copy of the most
recent  annual or quarterly  report of the Company,  and such other  reports and
documents  of  the  Company  and  other  information  in  the  possession  of or
reasonably  obtainable by the Company as a Purchaser may  reasonably  request in
availing itself of any rule or regulation of the Commission allowing a Purchaser
to sell any such securities without  registration.

          3.7 Transfer of Registration  Rights.  The rights to cause the Company
to register  securities  granted  Holders under Section 3.1 may be assigned to a
transferee  or  assignee  in  connection  with any  transfer  or  assignment  of
Registrable  Securities  by  a  Holder  of  not  less  than  138,611  shares  of
Registrable  Securities,  or to any  transferee or assignee who is a constituent
partner of a Holder or the estate of such  constituent  partner,  provided  that
such transfer may otherwise be effected in accordance with applicable securities
laws.

          3.8 Standoff Agreement. Each Holder agrees, provided that the officers
and directors of the Company agree to be bound by terms substantially  identical
to those contained in this Section 3.8, in connection with the Company's initial
public offering of the Company's securities,  upon request of the Company or the
underwriters managing any underwritten offering of the Company's securities, (i)
not to sell, make any short sale of, loan, grant any option for the purchase of,
or otherwise dispose of any Registrable Securities (other than those included in
the  registration)  without  the prior  written  consent of the  Company or such
underwriters,  as the case may be,  for such  period of time (not to exceed  one
hundred eighty (180) days) from the effective date of such  registration  as may
be  requested  by the  underwriters  and (ii)  further  agrees  to  execute  any
agreement  reflecting (i) above as may be requested by the  underwriters  at the
time of the public offering.

          3.9 Termination of Registration  Rights. The rights granted under this
Section 3 shall  terminate on the third  anniversary of the  consummation of the
initial  underwritten public offering of the Company's  securities pursuant to a
registration statement filed under the Securities Act.

     4. Bioject's Right of First Refusal.

          4.1  Right  of First  Refusal  Upon  Issuances  of  Securities  by the
Company.

               (a) The  Company  hereby  grants,  on the terms set forth in this
Section  4.1, to Bioject the right of first  refusal to purchase all or any part
of Bioject's pro rata share of the New Securities (as defined in Section 4.1(b))
which the Company may, from time to time, propose to sell and issue. Bioject may
purchase  said New  Securities  on the same terms and at the same price at which
the Company  proposes to sell the New Securities.  The pro rata share of Bioject
("Bioject's  Pro Rata Share"),  for purposes of this right of first refusal,  is
(except as set forth in paragraph 4.1(e) below) the ratio of the total number of
shares of Common Stock held by Bioject,  to the total number of shares of Common
Stock  outstanding  immediately  prior  to the  issuance  of the New  Securities
(including  any  shares of Common  Stock into  which any  outstanding  shares of
Preferred Stock are convertible).



                                      -8-
<PAGE>

               (b) "New Securities" shall mean any capital stock of the Company,
whether now  authorized or not, and any rights,  options or warrants to purchase
said capital  stock,  and  securities  of any type  whatsoever  that are, or may
become, convertible into said capital stock; provided that "New Securities" does
not include (i) currently outstanding securities,  (ii) securities issuable upon
conversion or exercise of or with respect to outstanding  options or convertible
securities,  (iii) securities offered pursuant to a registration statement filed
under the Securities Act, (iv) securities  issued pursuant to the acquisition of
another  corporation by the Company by merger,  purchase of substantially all of
the  assets or other  reorganization,  (v) all  shares of Common  Stock or other
securities  hereafter  issued or issuable  to  officers,  directors,  employees,
scientific  advisors or consultants  of the Company  pursuant to any employee or
consultant stock offering,  plan, arrangement or agreement approved by the Board
of Directors of the Company, (vi) all shares of Common Stock or other securities
hereafter  approved for issuance by the Company's  board of directors and issued
at fair market  value (as  determined  in good faith by the  Company's  board of
directors) in connection with or as  consideration  for acquisition or licensing
of technology, (vii) all shares of Common Stock or other securities approved for
issuance by the Company's board of directors and issued at fair market value (as
determined in good faith by the Company's board of directors) in connection with
equipment leasing or equipment  financing  arrangements,  (viii) up to 2,000,000
shares of Series B Preferred  Stock which may be issued from time to time by the
Company.

               (c) In the event the Company proposes to undertake an issuance of
New  Securities,  it shall give to Bioject  written notice (the "Notice") of its
intention,  describing  the type of New  Securities,  the price,  the terms upon
which the Company  proposes to issue the same,  and a statement as to the number
of days from receipt of such Notice  within  which  Bioject must respond to such
Notice.  Bioject  shall  have  thirty  (30) days from the date of receipt of the
Notice to purchase any or all of Bioject's Pro Rata Share of the New  Securities
for the price  and upon the  terms  specified  in the  Notice by giving  written
notice to the Company and stating  therein the quantity of New  Securities to be
purchased  and  forwarding  payment  for such New  Securities  to the Company if
immediate  payment  is  required  by such  terms,  or in any event no later than
thirty (30) days after the date of receipt of the Notice.

               (d) In the event  Bioject  fails to exercise in full the right of
first refusal within said thirty (30) day period,  the Company shall have ninety
(90) days  thereafter to sell or enter into an agreement  (pursuant to which the
sale of New Securities covered thereby shall be closed, if at all, within thirty
(30)  days  from  date of said  agreement)  to sell the New  Securities  and any
portion of Bioject's Pro Rata Share of New Securities respecting which Bioject's
rights were not  exercised,  at a price and upon general terms no more favorable
to the investors  thereof than specified in the Notice. In the event the Company
has not sold the New Securities  within said ninety (90) day period (or sold and
issued New Securities in accordance  with the foregoing  within thirty (30) days
from the date of said agreement), the Company shall not thereafter issue or sell
any New  Securities  without first  offering  such  securities to Bioject in the
manner provided above.

               (e) The right of first  refusal  granted  under this  Section 4.1
shall expire upon:



                                      -9-
<PAGE>

                    (i) The date upon which a  registration  statement  filed by
the Company under the Securities Act (other than a registration of securities in
a Rule  145  transaction  or  with  respect  to an  employee  benefit  plan)  in
connection with an underwritten  public offering of its securities first becomes
effective and the securities registered thereunder are sold.

                    (ii) The date on which  Bioject no longer holds a minimum of
138,611 Shares.

               (f) The right of first refusal  granted under this Section 4.1 is
not assignable with respect to blocks of less than 138,611 shares.

     5. General Provisions.

          5.1  Amendment and Waiver.  Any term of this  Agreement may be amended
and the observance of any term of this Agreement may be waived (either generally
or in a particular  instance and either  retroactively or  prospectively),  only
with the  written  consent of the  Company  and the holders of a majority of the
Shares.  Any amendment or waiver  effected in  accordance  with this Section 5.1
shall be binding  upon each holder of any Shares at the time  outstanding,  each
future holder of all such securities and the Company.

          5.2 Governing Law. This  Agreement  shall be governed by and construed
under the laws of the State of California.

          5.3 Successors and Assigns.  Except as otherwise  expressly  provided,
the provisions of this  Agreement  shall inure to the benefit of, and be binding
upon, the successors,  assigns,  heirs,  executors,  and  administrators  of the
parties.

          5.4  Severability.  In case any provision of this Agreement becomes or
is declared  by a court of  competent  jurisdiction  to be  unenforceable,  this
Agreement  shall  continue  in full force and  effect  without  said  provision;
provided, however, that no such severability shall be effective if it materially
changes the economic benefit of this Agreement to any party.

          5.5  Notices.  All  notices  and  other  communications   required  or
permitted  hereunder shall be in writing and shall be deemed  effectively  given
upon personal  delivery or upon deposit with the United  States Post Office,  by
first class mail, postage prepaid,  addressed: (a) if to Bioject, at its current
address or at such other address as Bioject shall have  furnished to the Company
in writing,  or (b) if to the Company,  at its current  address or at such other
address as the Company shall have furnished to Bioject in writing.

          5.6  Counterparts.  This  Agreement  may be  executed in any number of
counterparts,  each of which is an  original,  and all of which  together  shall
constitute one instrument.



                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]



                                      -10-
<PAGE>


         IN WITNESS  WHEREOF,  this  Agreement  has been executed as of the date
first above written.


ANGIOSENSE, INC.                       BIOJECT, INC.
a Delaware corporation                 an Oregon corporation

By: -------------------------------   By: -------------------------------

Title: ----------------------------   Title: -------------------------------


-----------------------------------   -----------------------------------
(Address)                             (Address)

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

<PAGE>

                                   EXHIBIT B

                             SCHEDULE OF EXCEPTIONS



     This Schedule of Exceptions is made and given  pursuant to Section 6 of the
AngioSense,  Inc. Stock  Purchase  Agreement  dated  September  21st,  1999 (the
"Agreement")  by and  between  AngioSense,  Inc.,  a Delaware  corporation  (the
"Company") and Bioject, Inc., an Oregon corporation  ("Bioject").  The paragraph
numbers in this  Schedule of Exceptions  correspond to the paragraph  numbers in
the Agreement which are modified by the disclosures  made herein;  however,  any
information  disclosed  herein under any paragraph  number shall be deemed to be
disclosed and  incorporated  into any other paragraph number under the Agreement
where such  disclosure  would be  appropriate.  Any terms used herein  which are
defined in the  Agreement  shall have the meanings  described  in the  Agreement
unless the context otherwise requires.

     6.3 Capitalization.

     As of the date of and immediately  prior to the execution of the Agreement,
the number of authorized and outstanding  shares of each class and series of the
Company's capital stock is as follows:

<TABLE>
                                                    Authorized                 Outstanding
                                                    ----------                 -----------
         <S>                                       <C>                         <C>
         Common Stock                               20,000,000                  2,990,000

         Series A Preferred Stock                      750,000                    750,000

         Series B Preferred Stock                    2,000,000                    107,500

</TABLE>

     The Company has adopted a 1999 Stock Plan (the  "Plan") and has reserved an
aggregate of 1,000,000 shares of its Common Stock for issuance under the Plan to
employees,  directors  and  consultants.  No options or other rights to purchase
shares under the Plan are currently  outstanding  and all  1,000,000  shares are
available for grant under the Plan.