EXHIBIT 10.36

                          REGISTRATION RIGHTS AGREEMENT

         REGISTRATION RIGHTS AGREEMENT (this "Agreement"),  dated as of _______,
2000, by and between UNIGENE  LABORATORIES,  INC. a Delaware  corporation,  (the
"Company"), and FUSION CAPITAL FUND II, LLC (together with it permitted assigns,
the "Buyer").  Capitalized  terms used herein and not otherwise  defined  herein
shall  have the  respective  meanings  set forth in the  Common  Stock  Purchase
Agreement  by and  between  the parties  hereto  dated as of _______,  200__ (as
amended,  restated,  supplemented  or otherwise  modified from time to time, the
"Purchase Agreement").

                                    WHEREAS:

         A. The Company has agreed, upon the terms and subject to the conditions
of the  Purchase  Agreement,  to issue to the Buyer (i) up to Twenty One Million
Dollars  ($21,000,000)  of the Company's  common stock, par value $.01 per share
(the "Common Stock") (the "Purchase Shares"),  and (ii) such number of shares of
Common Stock as is required  pursuant to Section 7(b) of the Purchase  Agreement
(the "Commitment Shares"); and

         B. To  induce  the  Buyer to enter  into the  Purchase  Agreement,  the
Company has agreed to provide certain  registration  rights under the Securities
Act of 1933,  as  amended,  and the rules  and  regulations  thereunder,  or any
similar successor statute  (collectively,  the "1933 Act"), and applicable state
securities laws.

         NOW,  THEREFORE,  in  consideration  of the  premises  and  the  mutual
covenants  contained  herein  and other  good and  valuable  consideration,  the
receipt and  sufficiency of which are hereby  acknowledged,  the Company and the
Buyer hereby agree as follows:

         1.       DEFINITIONS.
                  -----------

                  As used in this Agreement,  the following terms shall have the
following meanings:

                  a.  "Investor"  means the Buyer,  any  transferee  or assignee
thereof to whom a Buyer  assigns its rights under this  Agreement and who agrees
to become bound by the provisions of this Agreement in accordance with Section 9
and any transferee or assignee  thereof to whom a transferee or assignee assigns
its rights under this Agreement and who agrees to become bound by the provisions
of this Agreement in accordance with Section 9.

                  b.  "Person"   means  any  person  or  entity   including  any
corporation,  a limited liability  company,  an association,  a partnership,  an
organization, a business, an individual, a governmental or political subdivision
thereof or a governmental agency.

                  c. "Register,"  "registered,"  and  "registration"  refer to a
registration   effected  by  preparing  and  filing  one  or  more  registration
statements of the Company in  compliance  with the 1933 Act and pursuant to Rule
415 under the 1933 Act or any successor rule  providing for offering  securities
on a  continuous  basis  ("Rule  415"),  and  the  declaration  or  ordering  of
effectiveness of such registration  statement(s) by the United States Securities
and Exchange Commission (the "SEC").

                  d.  "Registrable  Securities"  means the Purchase Shares which
have been, or which may from time to time be, issued or issuable upon  purchases
of the  Available  Amount under the

<PAGE>


Purchase   Agreement  (without  regard  to  any  limitation  or  restriction  on
purchases) and the  Commitment  Shares issued to the Investor at or prior to the
Commencement  and any shares of capital stock issued or issuable with respect to
the Purchase Shares, the Commitment Shares or the Purchase Agreement as a result
of any stock split, stock dividend, recapitalization,  exchange or similar event
or otherwise,  without regard to any limitation on purchases  under the Purchase
Agreement.

                  e. "Registration  Statement" means the registration  statement
of the Company  which the Company has agreed to file pursuant to Section 4(a) of
the Purchase Agreement with respect to the sale of the Registrable Securities.

         2.       REGISTRATION.
                  ------------

                  a. Mandatory Registration.  The Company shall use best efforts
to keep the Registration  Statement  effective  pursuant to Rule 415 promulgated
under the 1933 Act and available for sales of all of the Registrable  Securities
at all times until the earlier of (i) the date as of which the Investor may sell
all of the Registrable  Securities without  restriction  pursuant to Rule 144(k)
promulgated under the 1933 Act (or successor  thereto) or (ii) the date on which
(A) the Investor shall have sold all the Registrable Securities and no Available
Amount remains under the Purchase  Agreement (the  "Registration  Period").  The
Registration  Statement  (including any  amendments or  supplements  thereto and
prospectuses  contained  therein)  shall not contain any untrue  statement  of a
material fact or omit to state 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.

                  b. Rule 424  Prospectus.  The  Company  shall,  as required by
applicable securities regulations, from time to time file with the SEC, pursuant
to Rule 424  promulgated  under  the 1933 Act,  the  prospectus  and  prospectus
supplements,  if any,  to be used in  connection  with sales of the  Registrable
Securities under the Registration Statement.  The Investor and its counsel shall
have a reasonable  opportunity to review and comment upon such prospectus  prior
to its filing with the SEC. The Investor shall use its  reasonable  best efforts
to comment  upon such  prospectus  within one (1)  Trading Day from the date the
Investor receives the final version of such prospectus.

                  c. Sufficient  Number of Shares  Registered.  In the event the
number of shares available under the  Registration  Statement is insufficient to
cover  all  of  the  Registrable   Securities,   the  Company  shall  amend  the
Registration Statement or file a new registration statement (a "New Registration
Statement"),  so as to  cover  all of  such  Registrable  Securities  as soon as
practicable,  but in any event not later  than ten (10)  Trading  Days after the
necessity  therefor arises.  The Company shall use it best efforts to cause such
amendment  and/or New  Registration  Statement  to become  effective  as soon as
practicable  following  the filing  thereof.  The Investor and its counsel shall
have a  reasonable  opportunity  to review and comment  upon any such  amendment
and/or New Registration Statement prior to its filing with the SEC. The Investor
shall use its reasonable best efforts to comment upon any such amendment  and/or
New  Registration  Statement  within  two (2)  Trading  Days  from  the date the
Investor   receives  the  final  version  of  any  such  amendment   and/or  New
Registration Statement.

                                      -2-
<PAGE>

         3.       RELATED OBLIGATIONS.
                  -------------------

         With respect to the Registration Statement and whenever any Registrable
Securities  are to be  registered  pursuant  to Section 2  including  on any New
Registration  Statement,  the Company shall use its  reasonable  best efforts to
effect the  registration  of the  Registrable  Securities in accordance with the
intended method of disposition thereof and, pursuant thereto,  the Company shall
have the following obligations:

                  a.  The  Company  shall  prepare  and  file  with the SEC such
amendments  (including   post-effective   amendments)  and  supplements  to  any
registration   statement  and  the  prospectus  used  in  connection  with  such
registration  statement,  which  prospectus is to be filed  pursuant to Rule 424
promulgated  under the 1933 Act, as may be  necessary  to keep the  Registration
Statement or any New  Registration  Statement  effective at all times during the
Registration Period, and, during such period,  comply with the provisions of the
1933 Act with respect to the  disposition of all  Registrable  Securities of the
Company covered by the Registration  Statement or any New Registration Statement
until such time as all of such  Registrable  Securities shall have been disposed
of in  accordance  with the  intended  methods of  disposition  by the seller or
sellers thereof as set forth in such registration statement.

                  b. The Company shall permit the Investor to review and comment
upon  the  Registration  Statement  or any New  Registration  Statement  and all
amendments and supplements  thereto at least two (2) Trading Days prior to their
filing  with the SEC,  and not file  any  document  in a form to which  Investor
reasonably  objects.  The  Investor  shall use its  reasonable  best  efforts to
comment upon the Registration  Statement or any New  Registration  Statement and
any amendments or supplements  thereto within two (2) Trading Days from the date
the Investor  receives the final version  thereof.  The Company shall furnish to
the Investor, without charge any correspondence from the SEC or the staff of the
SEC to the Company or its representatives relating to the Registration Statement
or any New Registration Statement.

                  c. The Company  shall  furnish to the  Investor,  (i) promptly
after the same is  prepared  and filed  with the SEC,  at least one copy of such
registration  statement  and  any  amendment(s)  thereto,   including  financial
statements and schedules,  all documents  incorporated  therein by reference and
all exhibits,  (ii) upon the  effectiveness of any registration  statement,  ten
(10) copies of the prospectus  included in such  registration  statement and all
amendments  and  supplements  thereto  (or such  other  number  of copies as the
Investor  may  reasonably  request)  and (iii) such other  documents,  including
copies of any  preliminary or final  prospectus,  as the Investor may reasonably
request  from  time  to time in  order  to  facilitate  the  disposition  of the
Registrable Securities owned by the Investor.

                  d. The  Company  shall  use  reasonable  best  efforts  to (i)
register  and  qualify  the  Registrable  Securities  covered by a  registration
statement under such other  securities or "blue sky" laws of such  jurisdictions
in the United States as the Investor reasonably requests,  (ii) prepare and file
in those jurisdictions,  such amendments (including  post-effective  amendments)
and supplements to such  registrations and qualifications as may be necessary to
maintain the effectiveness  thereof during the Registration  Period,  (iii) take
such other  actions as may be  necessary  to  maintain  such  registrations  and
qualifications in effect at all times during the Registration  Period,  and (iv)
take all  other  actions  reasonably  necessary  or  advisable  to  qualify  the
Registrable Securities for sale in such jurisdictions;  provided,  however, that
the  Company  shall not be required in  connection  therewith  or as a condition
thereto to (x)  qualify to do business  in any  jurisdiction  where it would not
otherwise be required to qualify but for this Section 3(d),  (y) subject  itself
to general taxation in any such  jurisdiction,  or (z) file a general consent to
service of process in any such  jurisdiction.  The Company shall promptly notify
the

                                      -3-
<PAGE>

Investor who holds  Registrable  Securities of the receipt by the Company of any
notification with respect to the suspension of the registration or qualification
of any of the Registrable Securities for sale under the securities or "blue sky"
laws of any jurisdiction in the United States or its receipt of actual notice of
the initiation or threatening of any proceeding for such purpose.

                  e. As promptly as  practicable  after  becoming  aware of such
event or facts,  the  Company  shall  notify  the  Investor  in  writing  of the
happening  of any  event or  existence  of such  facts as a result  of which the
prospectus included in any registration  statement,  as then in effect, includes
an  untrue  statement  of a  material  fact or omits to  state a  material  fact
required to be stated  therein or necessary to make the statements  therein,  in
light of the  circumstances  under  which they were made,  not  misleading,  and
promptly  prepare a supplement  or amendment to such  registration  statement to
correct such untrue  statement or omission,  and deliver ten (10) copies of such
supplement  or  amendment to the Investor (or such other number of copies as the
Investor may  reasonably  request).  The Company shall also promptly  notify the
Investor  in writing  (i) when a  prospectus  or any  prospectus  supplement  or
post-effective  amendment has been filed,  and when a registration  statement or
any  post-effective   amendment  has  become  effective  (notification  of  such
effectiveness shall be delivered to the Investor by facsimile on the same day of
such  effectiveness  and by overnight mail),  (ii) of any request by the SEC for
amendments or supplements to any registration statement or related prospectus or
related information,  and (iii) of the Company's reasonable determination that a
post-effective amendment to a registration statement would be appropriate.

                  f. The  Company  shall  use its  reasonable  best  efforts  to
prevent the issuance of any stop order or other  suspension of  effectiveness of
any  registration  statement,  or the  suspension  of the  qualification  of any
Registrable  Securities  for sale in any  jurisdiction  and, if such an order or
suspension  is issued,  to obtain the  withdrawal of such order or suspension at
the earliest  possible moment and to notify the Investor of the issuance of such
order  and the  resolution  thereof  or its  receipt  of  actual  notice  of the
initiation or threat of any proceeding for such purpose.

                  g. The Company shall (i) cause all the Registrable  Securities
to be listed on each securities  exchange or trading system on which  securities
of the same class or series  issued by the Company are then  listed,  if any, if
the listing of such Registrable  Securities is then permitted under the rules of
such exchange,  or (ii) secure  designation and quotation of all the Registrable
Securities on the Principal Market.  The Company shall pay all fees and expenses
in connection with satisfying its obligation under this Section.

                  h. The Company shall cooperate with the Investor to facilitate
the timely preparation and delivery of certificates (not bearing any restrictive
legend)  representing  the Registrable  Securities to be offered pursuant to any
registration  statement and enable such certificates to be in such denominations
or amounts as the Investor may  reasonably  request and registered in such names
as the Investor may request.

                  i. The Company shall at all times provide a transfer agent and
registrar with respect to its Common Stock.

                  j. If reasonably requested by the Investor,  the Company shall
(i)  immediately  incorporate  in  a  prospectus  supplement  or  post-effective
amendment such  information as the Investor  believes should be included therein
relating to the sale and  distribution  of  Registrable  Securities,  including,
without  limitation,  information  with  respect  to the  number of  Registrable
Securities  being sold,  the  purchase  price being paid  therefor and any other
terms of the  offering of the  Registrable

                                      -4-
<PAGE>

Securities;  (ii) make all required  filings of such  prospectus  supplement  or
post-effective  amendment as soon as notified of the matters to be  incorporated
in such prospectus supplement or post-effective  amendment; and (iii) supplement
or make amendments to any registration statement.

                  k. The Company shall use its reasonable  best efforts to cause
the  Registrable   Securities  covered  by  any  registration  statement  to  be
registered with or approved by such other  governmental  agencies or authorities
as  may  be  necessary  to  consummate  the  disposition  of  such   Registrable
Securities.

                  l. Within one (1) Trading Day after any registration statement
which includes the Registrable  Securities is ordered  effective by the SEC, the
Company shall deliver, and shall cause legal counsel for the Company to deliver,
to the  transfer  agent  for such  Registrable  Securities  (with  copies to the
Investor)  confirmation  that  such  registration  statement  has been  declared
effective by the SEC in the form attached hereto as Exhibit A.

                  m.  The  Company  shall  take  all  other  reasonable  actions
reasonably  requested by the Investor to expedite and facilitate  disposition by
the Investor of Registrable Securities pursuant to any registration statement.

         4.       OBLIGATIONS OF THE INVESTOR.
                  ---------------------------

                  a. The  Company  shall  notify the  Investor in writing of the
information the Company reasonably requires from the Investor in connection with
any registration statement hereunder.  The Investor shall furnish to the Company
such information regarding itself, the Registrable Securities held by it and the
intended method of disposition of the Registrable Securities held by it as shall
be reasonably required to effect the registration of such Registrable Securities
and shall execute such  documents in connection  with such  registration  as the
Company may reasonably request.

                  b. The  Investor  agrees  to  cooperate  with the  Company  as
reasonably  requested  by the Company in  connection  with the  preparation  and
filing of any registration statement hereunder.

                  c. The Investor  agrees that,  upon receipt of any notice from
the  Company of the  happening  of any event or  existence  of facts of the kind
described  in Section  3(f) or the first  sentence of 3(e),  the  Investor  will
immediately  discontinue  disposition of Registrable  Securities pursuant to any
registration   statement(s)  covering  such  Registrable  Securities  until  the
Investor's  receipt of the  copies of the  supplemented  or  amended  prospectus
contemplated  by Section  3(f) or the first  sentence  of 3(e).  Notwithstanding
anything to the contrary, the Company shall cause its transfer agent to promptly
deliver shares of Common Stock without any restrictive legend in accordance with
the terms of the Purchase  Agreement in connection  with any sale of Registrable
Securities  with  respect to which an Investor  has entered  into a contract for
sale  prior to the  Investor's  receipt  of a notice  from  the  Company  of the
happening  of any  event of the kind  described  in  Section  3(f) or the  first
sentence of 3(e) and for which the Investor has not yet settled.

         5.       EXPENSES OF REGISTRATION.
                  ------------------------

                  All  reasonable  expenses,   other  than  sales  or  brokerage
commissions  and  legal  fees and  disbursements  of  counsel  to the  Investor,
incurred in connection with registrations, filings or qualifications pursuant to
Sections 2 and 3, including,  without limitation, all registration,  listing and

                                      -5-
<PAGE>

qualifications fees, printers and accounting fees, and fees and disbursements of
counsel for the Company, shall be paid by the Company.

         6.       INDEMNIFICATION
                  ---------------

                  a. To the fullest extent  permitted by law, the Company shall,
and hereby does, indemnify,  hold harmless and defend the Investor, each Person,
if any,  who controls  the  Investor,  the  members,  the  directors,  officers,
partners, employees, agents, representatives of the Investor and each Person, if
any,  who  controls  the  Investor  within  the  meaning  of the 1933 Act or the
Securities  Exchange  Act of  1934,  as  amended  (the  "1934  Act")  (each,  an
"Indemnified  Person"),  against  any  losses,  claims,  damages,   liabilities,
judgments,  fines,  penalties,  charges, costs, attorneys' fees, amounts paid in
settlement or expenses, joint or several,  (collectively,  "Claims") incurred in
investigating,   preparing  or  defending  any  action,  claim,  suit,  inquiry,
proceeding,  investigation  or appeal taken from the  foregoing by or before any
court or governmental,  administrative or other regulatory  agency,  body or the
SEC,  whether pending or threatened,  whether or not an indemnified  party is or
may be a party thereto ("Indemnified  Damages"), to which any of them may become
subject insofar as such Claims (or actions or proceedings,  whether commenced or
threatened,  in respect  thereof) arise out of or are based upon: (i) any untrue
statement or alleged  untrue  statement of a material  fact in the  Registration
Statement,  any  New  Registration  Statement  or any  post-effective  amendment
thereto  or in any  filing  made in  connection  with the  qualification  of the
offering  under the securities or other "blue sky" laws of any  jurisdiction  in
which Registrable Securities are offered ("Blue Sky Filing"), or the omission or
alleged  omission  to state a material  fact  required  to be stated  therein or
necessary  to make the  statements  therein  not  misleading,  (ii)  any  untrue
statement  or alleged  untrue  statement  of a material  fact  contained  in any
preliminary  prospectus if used prior to the effective date of such registration
statement, or contained in the final prospectus (as amended or supplemented,  if
the Company files any amendment  thereof or supplement  thereto with the SEC) or
the omission or alleged omission to state therein any material fact necessary to
make the statements made therein,  in light of the circumstances under which the
statements  therein were made,  not  misleading,  (iii) any violation or alleged
violation  by the  Company  of the  1933  Act,  the 1934  Act,  any  other  law,
including,  without  limitation,  any  state  securities  law,  or any  rule  or
regulation  thereunder  relating  to  the  offer  or  sale  of  the  Registrable
Securities  pursuant  to the  Registration  Statement  or any  New  Registration
Statement or (iv) any material  violation of this  Agreement (the matters in the
foregoing  clauses (i)  through  (iv) being,  collectively,  "Violations").  The
Company shall, subject to Section 6(d) reimburse each Indemnified Person for any
legal fees or other  expenses  reasonably  incurred by them in  connection  with
investigating  or  defending  any such  Claim.  Notwithstanding  anything to the
contrary  contained  herein,  the  indemnification  agreement  contained in this
Section 6(a):  (i) shall not apply to a Claim by an  Indemnified  Person arising
out of or based upon a Violation which occurs in reliance upon and in conformity
with information  furnished in writing to the Company by such Indemnified Person
expressly  for  use in  connection  with  the  preparation  of the  Registration
Statement,  any New  Registration  Statement  or any such  amendment  thereof or
supplement  thereto, if such prospectus was timely made available by the Company
pursuant to Section 3(c) or Section 3(e);  (ii) with respect to any  preliminary
prospectus,  shall not inure to the benefit of any Indemnified  Person from whom
the person  asserting a Claim  purchased  the  Registrable  Securities  that are
offered for sale by the preliminary  prospectus (or to the benefit of any person
controlling  such person) if the untrue  statement or omission of material  fact
contained in the preliminary prospectus was corrected in the prospectus, as then
amended or  supplemented,  if such  prospectus  was timely made available by the
Company pursuant to Section 3(c) or Section 3(e), and the Indemnified Person was
promptly advised in writing not to use the incorrect prospectus prior to the use
giving rise to a violation and such  Indemnified  Person,  notwithstanding  such
advice,  used it; (iii) shall not be available to the extent such Claim is based
on a  failure  of the  Investor  to  deliver  or to  cause to be  delivered  the
prospectus  made  available by the Company,  if such  prospectus was

                                      -6-
<PAGE>

timely made  available by the Company  pursuant to Section 3(c) or Section 3(e);
and (iv)  shall not apply to  amounts  paid in  settlement  of any Claim if such
settlement is effected  without the prior written consent of the Company,  which
consent shall not be unreasonably withheld.  Such indemnity shall remain in full
force and effect  regardless  of any  investigation  made by or on behalf of the
Indemnified Person and shall survive the transfer of the Registrable  Securities
by the Investor pursuant to Section 9.

                  b. In connection  with the  Registration  Statement or any New
Registration  Statement,  the Investor shall, and hereby does,  indemnify,  hold
harmless  and defend,  to the same extent and in the same manner as is set forth
in Section 6(a), the Company,  each of its  directors,  each of its officers who
signs the Registration Statement or any New Registration Statement, each Person,
if any, who controls the Company  within the meaning of the 1933 Act or the 1934
Act  (collectively  and together with an  Indemnified  Person,  an  "Indemnified
Party"),  against  any  Claim or  Indemnified  Damages  to which any of them may
become subject,  under the 1933 Act, the 1934 Act or otherwise,  insofar as such
Claim or Indemnified  Damages arise out of or are based upon any  Violation,  in
each case to the extent,  and only to the extent,  that such Violation occurs in
reliance  upon and in  conformity  with  written  information  furnished  to the
Company by the Investor  expressly for use in connection with such  registration
statement;  and,  subject to Section 6(d), the Investor will reimburse any legal
or other expenses  reasonably  incurred by them in connection with investigating
or defending any such Claim;  provided,  however,  that the indemnity  agreement
contained in this Section 6(b) and the  agreement  with respect to  contribution
contained  in Section 7 shall not apply to  amounts  paid in  settlement  of any
Claim if such  settlement is effected  without the prior written  consent of the
Investor, which consent shall not be unreasonably withheld;  provided,  further,
however, that the Investor shall be liable under this Section 6(b) for only that
amount of a Claim or Indemnified  Damages as does not exceed the net proceeds to
the Investor as a result of the sale of Registrable  Securities pursuant to such
registration  statement.  Such  indemnity  shall remain in full force and effect
regardless of any  investigation  made by or on behalf of such Indemnified Party
and shall  survive the transfer of the  Registrable  Securities  by the Investor
pursuant to Section 9.

                  c.  Promptly  after  receipt  by  an  Indemnified   Person  or
Indemnified  Party  under this  Section 6 of notice of the  commencement  of any
action or proceeding (including any governmental action or proceeding) involving
a Claim,  such  Indemnified  Person or  Indemnified  Party shall,  if a Claim in
respect thereof is to be made against any indemnifying  party under this Section
6,  deliver  to the  indemnifying  party a written  notice  of the  commencement
thereof, and the indemnifying party shall have the right to participate in, and,
to the  extent  the  indemnifying  party so  desires,  jointly  with  any  other
indemnifying party similarly  noticed,  to assume control of the defense thereof
with counsel mutually satisfactory to the indemnifying party and the Indemnified
Person or the Indemnified Party, as the case may be; provided,  however, that an
Indemnified  Person or Indemnified  Party shall have the right to retain its own
counsel with the fees and expenses to be paid by the indemnifying  party, if, in
the  reasonable  opinion of counsel  retained  by the  indemnifying  party,  the
representation  by such counsel of the Indemnified  Person or Indemnified  Party
and the  indemnifying  party would be  inappropriate  due to actual or potential
differing interests between such Indemnified Person or Indemnified Party and any
other party  represented  by such counsel in such  proceeding.  The  Indemnified
Party or Indemnified Person shall cooperate fully with the indemnifying party in
connection  with any  negotiation  or defense of any such action or claim by the
indemnifying  party and shall furnish to the indemnifying  party all information
reasonably  available  to the  Indemnified  Party or  Indemnified  Person  which
relates  to such  action  or  claim.  The  indemnifying  party  shall  keep  the
Indemnified  Party or  Indemnified  Person fully apprised at all times as to the
status of the defense or any settlement  negotiations  with respect thereto.  No
indemnifying  party shall be liable for any  settlement of any action,  claim or
proceeding  effected without its written consent,  provided,  however,  that the
indemnifying  party shall not  unreasonably

                                      -7-
<PAGE>

withhold,  delay or condition its consent. No indemnifying party shall,  without
the consent of the Indemnified Party or Indemnified Person,  consent to entry of
any judgment or enter into any  settlement  or other  compromise  which does not
include as an unconditional term thereof the giving by the claimant or plaintiff
to such Indemnified Party or Indemnified  Person of a release from all liability
in respect to such claim or litigation.  Following  indemnification  as provided
for hereunder,  the indemnifying  party shall be subrogated to all rights of the
Indemnified Party or Indemnified Person with respect to all third parties, firms
or corporations  relating to the matter for which indemnification has been made.
The  failure  to  deliver  written  notice to the  indemnifying  party  within a
reasonable  time of the  commencement  of any such action shall not relieve such
indemnifying  party of any liability to the  Indemnified  Person or  Indemnified
Party under this Section 6, except to the extent that the indemnifying  party is
prejudiced in its ability to defend such action.

                  d. The  indemnification  required  by this  Section 6 shall be
made by  periodic  payments  of the  amount  thereof  during  the  course of the
investigation or defense,  as and when bills are received or Indemnified Damages
are incurred.

                  e.  The  indemnity  agreements  contained  herein  shall be in
addition to (i) any cause of action or similar right of the Indemnified Party or
Indemnified  Person  against  the  indemnifying  party or  others,  and (ii) any
liabilities the indemnifying party may be subject to pursuant to the law.

         7.       CONTRIBUTION.
                  ------------

                  To the extent any  indemnification by an indemnifying party is
prohibited or limited by law, the indemnifying  party agrees to make the maximum
contribution  with respect to any amounts for which it would otherwise be liable
under Section 6 to the fullest extent permitted by law; provided, however, that:
(i) no seller of Registrable  Securities guilty of fraudulent  misrepresentation
(within  the  meaning of Section  11(f) of the 1933 Act)  shall be  entitled  to
contribution  from any seller of  Registrable  Securities  who was not guilty of
fraudulent misrepresentation; and (ii) contribution by any seller of Registrable
Securities shall be limited in amount to the net amount of proceeds  received by
such seller from the sale of such Registrable Securities.

         8.       REPORTS AND DISCLOSURE UNDER THE SECURITIES ACTS.
                  ------------------------------------------------

                  With a view to making  available  to the Investor the benefits
of Rule  144  promulgated  under  the  1933  Act or any  other  similar  rule or
regulation  of the SEC that  may at any time  permit  the  Investor  to sell the
Registrable  Securities to the public  without  registration  ("Rule 144"),  the
Company agrees to:

                  a. make and keep public information available,  as those terms
are understood and defined in Rule 144;

                  b. file with the SEC in a timely  manner all reports and other
documents required of the Company under the 1933 Act and the 1934 Act so long as
the Company remains subject to such  requirements and the filing of such reports
and other documents is required for the applicable provisions of Rule 144; and

                  c.  furnish  to the  Investor  so  long as the  Investor  owns
Registrable  Securities,  promptly upon request,  (i) a written statement by the
Company that it has complied with the reporting and or disclosure  provisions of
Rule 144, the 1933 Act and the 1934 Act,  (ii) a copy of the most recent

                                       -8-
<PAGE>

annual or quarterly  report of the Company and such other  reports and documents
so filed by the Company,  and (iii) such other  information as may be reasonably
requested  to permit the Investor to sell such  securities  pursuant to Rule 144
without registration.

         9.       ASSIGNMENT OF REGISTRATION RIGHTS.
                  ---------------------------------

                  The Company  shall not assign this  Agreement or any rights or
obligations  hereunder  without  the  prior  written  consent  of the  Investor,
including  by merger or  consolidation.  The  Investor may not assign its rights
under this Agreement  without the written consent of the Company,  other than to
an  affiliate  of the  Investor  controlled  by  Steven  G.  Martin or Joshua B.
Scheinfeld.

         10.      AMENDMENT OF REGISTRATION RIGHTS.
                  --------------------------------

                  Provisions of this Agreement may be amended and the observance
thereof 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 Investor.

         11.      MISCELLANEOUS.
                  -------------

                  a. A Person is deemed to be a holder of Registrable Securities
whenever  such  Person  owns or is  deemed  to own of  record  such  Registrable
Securities.  If  the  Company  receives  conflicting  instructions,  notices  or
elections  from  two or  more  Persons  with  respect  to the  same  Registrable
Securities,  the  Company  shall act upon the basis of  instructions,  notice or
election received from the registered owner of such Registrable Securities.

                  b. Any  notices,  consents,  waivers  or other  communications
required or permitted to be given under the terms of this  Agreement  must be in
writing  and will be deemed  to have  been  delivered:  (i) upon  receipt,  when
delivered  personally;  (ii)  upon  receipt,  when sent by  facsimile  (provided
confirmation of transmission  is  mechanically or  electronically  generated and
kept on file by the sending  party);  or (iii) one (1) Trading Day after deposit
with a nationally  recognized  overnight delivery service, in each case properly
addressed to the party to receive the same. The addresses and facsimile  numbers
for such communications shall be:

         If to the Company:
                  Unigene Laboratories, Inc.
                  110 Little Falls Road
                  Fairfield, New Jersey 07004
                  Telephone:        973-882-0860
                  Facsimile:        973-227-6088
                  Attention:        Warren Levy

         With a copy to:
                  Covington & Burling
                  1201 Pennsylvania Avenue, N.W.
                  Washington, D.C. 20004
                  Telephone:        202-662-5276
                  Facsimile:        202-778-5276
                  Attention:        D. Michael Lefever

<PAGE>

         If to the Investor:
                  Fusion Capital Fund II, LLC
                  222 Merchandise Mart Plaza, Suite 9-112
                  Chicago, IL 60654
                  Telephone:        312-644-6644
                  Facsimile:        312-644-6244
                  Attention:        Steven G.  Martin

or at such other address and/or facsimile number and/or to the attention of such
other person as the  recipient  party has  specified by written  notice given to
each other  party  three (3)  Trading  Days prior to the  effectiveness  of such
change.  Written  confirmation  of receipt  (A) given by the  recipient  of such
notice,   consent,   waiver  or  other   communication,   (B)   mechanically  or
electronically  generated by the sender's facsimile machine containing the time,
date,  recipient  facsimile  number  and an  image  of the  first  page  of such
transmission  or (C)  provided by a  nationally  recognized  overnight  delivery
service, shall be rebuttable evidence of personal service,  receipt by facsimile
or receipt from a nationally recognized overnight delivery service in accordance
with clause (i), (ii) or (iii) above, respectively.

                  c.  Failure of any party to exercise any right or remedy under
this  Agreement or otherwise,  or delay by a party in  exercising  such right or
remedy, shall not operate as a waiver thereof.

                  d.  Except  for the  corporate  laws of the State of  Delaware
which shall govern all issues  concerning the relative rights of the Company and
its  stockholders,   all  questions   concerning  the  construction,   validity,
enforcement  and  interpretation  of this  Agreement  shall be  governed  by the
internal laws of the State of Illinois,  without  giving effect to any choice of
law or conflict of law  provision  or rule  (whether of the State of Illinois or
any other  jurisdictions)  that would cause the  application  of the laws of any
jurisdictions  other than the State of Illinois.  Each party hereby  irrevocably
submits to the exclusive  jurisdiction  of the state and federal  courts sitting
the  City of  Chicago,  for the  adjudication  of any  dispute  hereunder  or in
connection  herewith or with any  transaction  contemplated  hereby or discussed
herein,  and hereby  irrevocably  waives,  and agrees not to assert in any suit,
action  or  proceeding,  any  claim  that it is not  personally  subject  to the
jurisdiction of any such court,  that such suit, action or proceeding is brought
in an inconvenient forum or that the venue of such suit, action or proceeding is
improper.  Each party hereby  irrevocably waives personal service of process and
consents  to process  being  served in any such suit,  action or  proceeding  by
mailing a copy thereof to such party at the address for such notices to it under
this Agreement and agrees that such service shall constitute good and sufficient
service of process and notice thereof.  Nothing contained herein shall be deemed
to limit in any way any right to serve  process in any manner  permitted by law.
If any  provision of this  Agreement  shall be invalid or  unenforceable  in any
jurisdiction,  such invalidity or unenforceability shall not affect the validity
or enforceability of the remainder of this Agreement in that jurisdiction or the
validity or  enforceability  of any  provision  of this  Agreement  in any other
jurisdiction.  EACH PARTY HEREBY  IRREVOCABLY  WAIVES ANY RIGHT IT MAY HAVE, AND
AGREES  NOT TO  REQUEST,  A JURY  TRIAL  FOR  THE  ADJUDICATION  OF ANY  DISPUTE
HEREUNDER  OR IN  CONNECTION  HEREWITH OR ARISING OUT OF THIS  AGREEMENT  OR ANY
TRANSACTION CONTEMPLATED HEREBY.

                  e. This Agreement,  and the Purchase Agreement  constitute the
entire  agreement  among the parties  hereto with respect to the subject  matter
hereof  and  thereof.  There  are  no  restrictions,   promises,  warranties  or
undertakings, other than those set forth or referred to herein and therein. This
Agreement  and  the  Purchase  Agreement  supersede  all  prior  agreements  and
understandings  among the  parties  hereto with  respect to the  subject  matter
hereof and thereof.

                                      -10-

<PAGE>


                  f. Subject to the  requirements  of Section 9, this  Agreement
shall inure to the benefit of and be binding upon the permitted  successors  and
assigns of each of the parties hereto.

                  g. The  headings  in this  Agreement  are for  convenience  of
reference only and shall not limit or otherwise affect the meaning hereof.

                  h. This  Agreement may be executed in identical  counterparts,
each of which shall be deemed an original but all of which shall  constitute one
and the same  agreement.  This  Agreement,  once  executed  by a  party,  may be
delivered to the other party hereto by facsimile  transmission of a copy of this
Agreement bearing the signature of the party so delivering this Agreement.

                  i. Each party  shall do and  perform,  or cause to be done and
performed,  all such further acts and things,  and shall execute and deliver all
such other  agreements,  certificates,  instruments and documents,  as the other
party may reasonably request in order to carry out the intent and accomplish the
purposes of this Agreement and the consummation of the transactions contemplated
hereby.

                  j. The language  used in this  Agreement  will be deemed to be
the language  chosen by the parties to express  their mutual intent and no rules
of strict construction will be applied against any party.

                  k. This  Agreement  is intended for the benefit of the parties
hereto and their respective permitted successors and assigns, and is not for the
benefit of, nor may any provision hereof be enforced by, any other Person.

                                   * * * * * *


                                      -11-
<PAGE>


         IN WITNESS WHEREOF,  the parties have caused this  Registration  Rights
Agreement to be duly executed as of day and year first above written.

                                  THE COMPANY:

                                  UNIGENE LABORATORIES, INC.

                                  By:______________________
                                  Name:
                                  Title:


                                  BUYER:

                                  FUSION CAPITAL FUND II, LLC
                                  BY: FUSION CAPITAL PARTNERS, LLC
                                  BY: SGM HOLDINGS CORP.

                                  By:_______________________
                                  Name: Steven G. Martin
                                  Title: President


<PAGE>


                                    EXHIBIT A

                        TO REGISTRATION RIGHTS AGREEMENT

                         FORM OF NOTICE OF EFFECTIVENESS
                            OF REGISTRATION STATEMENT

[Date]

[TRANSFER AGENT]

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

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


Re: [__________]

Ladies and Gentlemen:

          We are counsel to UNIGENE  LABORATORIES,  INC., a Delaware corporation
(the  "Company"),  and have  represented  the  Company in  connection  with that
certain Common Stock Purchase Agreement (the "Purchase  Agreement") entered into
by and among the Company and Fusion Capital Fund II, LLC (the "Holder") pursuant
to which the  Company has agreed to issue to the Holder up to Twenty One Million
Dollars  ($21,000,000)  of the Company's Common Stock, par value $0.01 per share
(the "Common  Stock") (the "Purchase  Shares"),  in accordance with the terms of
the Purchase Agreement, and (ii) the Company issued to the Holder _______ shares
of Common Stock (the "Commitment  Shares").  Pursuant to the Purchase Agreement,
the Company  also has entered  into a  Registration  Rights  Agreement  with the
Holder  (the  "Registration  Rights  Agreement")  pursuant  to which the Company
agreed,  among other things,  to register the Purchase Shares and the Commitment
Shares  under the  Securities  Act of 1933,  as  amended  (the "1933  Act").  In
connection with the Company's  obligations under the Purchase  Agreement and the
Registration   Rights  Agreement,   on   _____________,   the  Company  filed  a
Registration   Statement  (File  No.   333-_____________)   (the   "Registration
Statement") with the Securities and Exchange  Commission (the "SEC") relating to
the sale of the Purchase Shares and the Commitment Shares.

          In connection  with the foregoing,  we advise you that a member of the
SEC's  staff has  advised  us by  telephone  that the SEC has  entered  an order
declaring the Registration Statement effective under the 1933 Act at [ENTER TIME
OF  EFFECTIVENESS]  on [ENTER DATE OF  EFFECTIVENESS]  and we have no knowledge,
after  telephonic  inquiry of a member of the SEC's  staff,  that any stop order
suspending its  effectiveness  has been issued or that any  proceedings for that
purpose are pending  before,  or threatened by, the SEC and the Purchase  Shares
and the Commitment  Shares are available for sale under the 1933 Act pursuant to
the Registration Statement.

          The Buyer has confirmed it shall comply with all  securities  laws and
regulations   applicable  to  it  including   applicable   prospectus   delivery
requirements upon sale of the Commitment Shares or the Purchase Shares.

                                            Very truly yours,
                                            [Company Counsel]
                                            By:____________________


cc:       Fusion Capital Fund II, LLC