<PAGE>

                                                                     Exhibit 4.2

                          DISCOVERY THERAPEUTICS, INC.

                       RESTATED INVESTOR RIGHTS AGREEMENT

                                 March 31, 1995

<PAGE>

                               Table Of Contents
<TABLE>
<CAPTION>
                                                                                              Page
<S>                                                                                           <C>
ARTICLE 1           DEFINITIONS ............................................................     1

         1.1    Certain Definitions ........................................................     1

ARTICLE 2           RESTRICTIONS ON TRANSFER ...............................................     2

         2.1    Restrictions on Transferability ............................................     2

         2.2    Restrictive Legend .........................................................     3

         2.3    Notice of Proposed Transfers ...............................................     3

ARTICLE 3           REGISTRATION RIGHTS ....................................................     4

         3.1    Demand Registration Rights .................................................     4

         3.2    Company Registration .......................................................     6

         3.3    Form S-3 Registration Rights ...............................................     6

         3.4    Expenses of Registration ...................................................     7

         3.5    Registration Procedures ....................................................     8

         3.6    Indemnification ............................................................     9

         3.7    Information by Holder ......................................................    11

         3.8    Rule 144 Reporting .........................................................    11

         3.9    Transfer of Registration Rights ............................................    11

         3.10   Termination of Registration Rights .........................................    12

         3.11   "Market Stand Off" Agreement ...............................................    12

         3.12   Inclusion of Stock Held by Founders and Common Stock held by Holders .......    12

         3.13   Limitations on Subsequent Registration Rights ..............................    13

ARTICLE 4           AFFIRMATIVE COVENANTS OF THE COMPANY ...................................    13

         4.1    Financial Information ......................................................    13

         4.2    Inspection .................................................................    13

         4.3    Assignment of Rights to Financial Information ..............................    13

         4.4    Attendance at Board Meetings ...............................................    14

         4.5    Compensation Committee .....................................................    14

         4.6    Sales of Series B Preferred ................................................    14

         4.7    Termination of Covenants ...................................................    14

ARTICLE 5           AFFIRMATIVE COVENANTS OF HOLDERS; RIGHT OF FIRST REFUSAL ...............    15
</TABLE>

                                       i.

<PAGE>

                               Table Of Contents
                                  (continued)

<TABLE>
<CAPTION>
                                                                                         Page
<S>                                                                                      <C>
         5.1      Confidential Information, etc. ......................................    15

         5.2      Right of First Refusal ..............................................    15

ARTICLE 6             MISCELLANEOUS ...................................................    16

         6.1      Governing Law .......................................................    16

         6.2      Successors and Assigns ..............................................    16

         6.3      Entire Agreement ....................................................    16

         6.4      Rights of Holders ...................................................    17

         6.5      Notices, etc. .......................................................    17

         6.6      Counterparts ........................................................    17

         6.7      Severability ........................................................    17

         6.8      Approval of Amendments and Waivers ..................................    17
</TABLE>

                                      ii.



<PAGE>

                          DISCOVERY THERAPEUTICS, INC.

                       RESTATED INVESTOR RIGHTS AGREEMENT

         This Restated Investor Rights Agreement (the "Agreement") is entered
into as of March 31, 1995 by and among DISCOVERY THERAPEUTICS, INC., a Delaware
corporation with its principal office located at 2028 Dabney Road, Suite E-17,
Richmond, Virginia 23230 (the "Company"), and DONALD A. MCAFEE, NOEL J. CUSACK,
JAMES V. PECK, GEVORK MINASKANIAN and SANDERLING (collectively, the "Founders"),
and the undersigned persons (the "Investors") who hereby amend and restate that
certain Investor Rights Agreement, dated as of April 22, 1994, by and among the
Company, the Founders and certain Investors (the "Prior Agreement").

                                    Recitals

         Whereas, the Company is issuing shares of its Series B Preferred Stock
("Series B Preferred") pursuant to that certain Series B Preferred Stock
Purchase Agreement dated as of the date hereof (the "Series B Agreement") and
shares of its Common Stock (the "Common Shares") to Alliance Technology
Ventures, L.P., ATV/MFJ Parallel Fund, L.P. and ATV/GP Parallel Fund, L.P.
pursuant to common stock investment letters dated as of the date hereof and
desires to grant to the parties thereto the rights herein set forth.

         Now, Therefore, in consideration of the mutual agreements, covenants
and conditions contained herein, the Company, the Founders and the Investors
hereby agree that all consents or conditions required to be obtained or
satisfied under the Prior Agreement in connection with the transactions
contemplated in the Series B Agreement are hereby given and that the Prior
Agreement is amended and restated to read in full as follows:

                                   ARTICLE 1

                                   DEFINITIONS

         1.1   Certain Definitions.  As used in this Agreement, the following
terms  shall have the following respective meanings:

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

         "Form S-3" shall mean Form S-3 under the Securities Act as in effect on
the date of this Agreement, or any substantially similar, equivalent or
successor form under the Securities Act.

         "Founders' Shares" shall mean those shares of the Company's Common
Stock owned by the Founders and outstanding as of the date of this Agreement.

         "Holder" shall mean any Investor or any transferee of registration
rights under Section 3.9 hereof who then holds any outstanding shares of the
Company's Series A Preferred Stock or

                                       1.

<PAGE>

Series B Preferred Stock (collectively, the "Preferred") or any Common Shares
and any Founder or Investor deemed to be a Holder pursuant to Section 3.12, but
solely for the purposes set forth therein.

         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.

         "Registrable Securities" means (i) shares of the Company's Common Stock
issued or issuable upon the conversion of shares of Preferred which have not
been sold to the public and (ii) shares of the Company's Common Stock issued in
respect of such shares of the Company's Common Stock, Preferred or Common Stock
issued or issuable upon the conversion of Preferred upon any stock split, stock
dividend, recapitalization, or similar event, which have not been sold to the
public, (iii) shares of the Company's Common Stock deemed to be Registrable
Securities pursuant to Section 3.12, but solely for the purposes set forth
therein, which have not been sold to the public and (iv) the Common Shares.

         "Registration Expenses" shall mean all expenses incurred by the Company
in complying with Sections 3.1, 3.2 and 3.3 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, and 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).

         "Restricted Securities" shall mean the securities of the Company
required to bear the legend set forth in Section 2.2 hereof and all shares of
Common Stock outstanding on the date of this Agreement.

         "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.

         "Selling Expense" shall mean all underwriting discounts and selling
commissions applicable to the sale.

                                   ARTICLE 2

                            RESTRICTIONS ON TRANSFER

         2.1  Restrictions on Transferability. The Preferred (and any Common
Stock into which the Preferred may be converted), the Common Shares and the
Founders' Shares shall not be transferable except upon the conditions specified
in this Agreement, which conditions are intended to insure compliance with the
provisions of the Securities Act, or upon such other terms as are in the opinion
of counsel to the Company satisfactory to comply with the provisions of the
Securities Act. Except for transfers made pursuant to Rule 144 of the Securities
Act ("Rule 144") or pursuant to an effective registration statement, each
Investor will cause any proposed transferee of Preferred (and any Common Stock
into which the Preferred may be converted) and

                                       2.

<PAGE>

any Common Shares held by such Investor, and each Founder will cause any
proposed transferee of Founders' Shares, to agree to take and hold such
securities subject to the provisions and upon the conditions specified in this
Agreement and it will be a condition precedent to the effectiveness of any such
transfer that the Company shall have secured a written agreement in form and
substance satisfactory to the Company to that effect, if so requested by the
Company.

     2.2  Restrictive Legend. Each certificate representing (i) the Preferred,
(ii) the Common Shares, (iii) the Founders' Shares and (iv) shares of the
Company's Common Stock issued upon conversion of the Preferred or issued in
respect of such Preferred, Common Shares, Founders' Shares or Common Stock 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 substantially in the
following form (in addition to any legend required under applicable California
or other 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 OR AN EXEMPTION THEREFROM UNDER 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.

     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
transfer of any Restricted Securities, 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. Each such notice shall describe the manner and
circumstances of the proposed transfer in sufficient detail, and shall be
accompanied (except in transactions in compliance with Rule 144) by either (i) a
written opinion of legal counsel reasonably satisfactory to the Company
addressed to the Company and reasonably satisfactory in form and substance to
the Company's counsel, 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, and a copy of the
investor's request (together with all supplements or amendments thereto), which
shall have been provided to the Company at or prior to the time of first
delivery to the Commission's staff, to the effect that the transfer of such
securities without registration will not result in a recommendation by such
staff 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
provided for above shall bear 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 the Company or counsel for such holder,
which opinion and counsel shall be satisfactory to counsel for the Company, such
legend is not required in order to establish compliance with any provisions of
the Securities Act.

                                       3.

<PAGE>

     Notwithstanding the provisions above, no such opinion of counsel or "no
action letter" shall be necessary for a transfer by an Investor which is a
partnership to a partner of such partnership or a retired partner of such
partnership who retires after the date hereof, or to the estate of any such
partner or retired partner or the transfer by gift, will or intestate succession
of any partner to his spouse or to the siblings, lineal descendants or ancestors
of such partner or his spouse, if the transferee agrees in writing to be subject
to the terms hereof to the same extent as if he were an original Investor
hereunder.

                                   ARTICLE 3

                               REGISTRATION RIGHTS

     3.1  Demand Registration Rights.

          (a) If the Company shall receive a written request (specifying that it
is being made pursuant to this Section 3.1) from the Holders of at least fifty
percent (50%) of the outstanding Registrable Securities (the "Initiating
Holders") that the Company file a registration statement or similar document
under the Securities Act covering the registration of at least fifty percent
(50%) of the then outstanding Registrable Securities, or any lesser percentage
if the anticipated aggregate offering proceeds, net of Selling Expenses, would
be equal to or exceed $5,000,000, then the Company shall promptly notify all
other Holders of such request and shall use its best efforts to cause all
Registrable Securities that such Holders have requested, within 15 days after
receipt of such written notice, to be registered under the Securities Act in
accordance with this Section 3.1.

     Notwithstanding the foregoing, (1) the Company shall not be obligated to
effect a registration pursuant to this Section 3.1, (i) during the period
starting with the date ninety (90) days prior to the Company's estimated date of
filing of, and ending on a date sixty (60) days following the effective date of,
a registration statement pertaining to an underwritten public offering of the
Company's securities, provided that the Company is actively employing in good
faith all reasonable efforts to cause such registration statement to become
effective and that the Company's estimate of the date of filing such
registration statement is made in good faith, or (ii) within the 12 month period
following the closing of the initial underwritten public offering of the
Company's Common Stock, or (iii) prior to the second anniversary of the closing
date of the sale of Series B Preferred pursuant to the Series B Agreement, and
(2) if the Company shall furnish to such Holders a certificate signed by the
President of the Company stating that in the good faith judgment of the Board of
Directors it would be seriously detrimental to the Company or its Holders for a
registration statement to be filed in the near future, then the Company's
obligation to use its best efforts to file a registration statement shall be
deferred for a period not to exceed one hundred eighty (180) days; provided,
however, that the Company shall not obtain such a deferral more than once in any
12-month period.

     The Company shall be obligated to effect not more than one registration
pursuant to this Section 3.1; provided, however, a demand registration request
shall not count as such until the registration statement to which it relates has
been declared effective by the Securities and Exchange Commission ("SEC"),
except that if, after it has been declared effective, such offering

                                       4.

<PAGE>

is interfered with by any stop order, injunction or other order or requirement
by the SEC or any other governmental authority, such registration shall be
deemed not to have been effected unless such stop order, injunction or other
order or requirement shall subsequently have been vacated or otherwise removed
or resulted from any action taken or information supplied by an Initiating
Holder, in which case a demand registration request shall only count as such
with respect to such Initiating Holder.

        (b)  If the Initiating Holders intend to distribute the Registrable
Securities covered by their demand by means of an underwriting, they shall so
advise the Company as part of their demand made pursuant to this Section 3.1,
and the Company shall include such information in the notice referred to in
Section 3.1(a). 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 such Holder's Registrable Securities in
the underwriting (unless otherwise mutually agreed by a majority in interest of
the Initiating Holders and such Holder) to the extent provided herein.

     The Company shall, together with all Holders proposing to distribute their
securities through such underwriting, enter into an underwriting agreement in
customary form with the underwriter or underwriters selected by a majority in
interest of the Initiating Holders and reasonably satisfactory to the Company.
Notwithstanding any other provision of this Section 3.1, and subject to the
provisions of Section 3.2, if the underwriter shall advise the Company in
writing that marketing factors (including, without limitation, an adverse effect
on the per share offering price) require a limitation of the number of shares to
be underwritten, then the Company shall so advise all Holders of Registrable
Securities that would otherwise be registered and underwritten pursuant hereto,
and the number of shares of Registrable Securities that may be included in the
registration and underwriting shall be allocated pro rata among such Holders
thereof 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. No Registrable Securities excluded from the underwriting
by reason of the foregoing underwriter's marketing limitation shall be included
in such registration.

     If any Holder disapproves of the terms of the underwriting, such Holder may
elect to withdraw therefrom by written notice to the Company, the underwriter,
and the Initiating Holders. The Registrable Securities so withdrawn shall also
be withdrawn from registration. If by the withdrawal of such Registrable
Securities a greater number of Registrable Securities held by other Holders may
be included in such registration (up to the maximum of any limitation imposed by
the underwriters), then the Company shall offer to all Holders who have included
Registrable Securities in the registration the right to include additional
Registrable Securities in the same proportion used in determining the
underwriter limitation in this Section 3.1(b).

     If the underwriter has not limited the number of Registrable Securities to
be underwritten, the Company may include securities for its own account (or for
the account of other stockholders) in such registration if the underwriter so
agrees and if the number of Registrable Securities that would otherwise have
been included in such registration and underwriting will not thereby be limited.

                                       5.

<PAGE>

     3.2  Company Registration.

          (a)  Notice to Holders. 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 others, other than a registration relating solely to
employee benefit plans on Form S-8 or similar forms which may be promulgated in
the future or a registration on Form S-4 or similar forms which may be
promulgated in the future relating solely to a Rule 145 (as defined below) or
similar transaction, the Company will (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 Registrable Securities of such Holders as specified in a
written request or requests made within 15 days after receipt of such written
notice from the Company.

          (b)  Underwriting. If the registration statement of which the Company
gives notice under Section 3.2(a) is for an underwritten offering, the Company
shall so advise the Holders of Registrable Securities. In such event, the right
of any such Holder to be included in a registration pursuant to this Section 3.2
shall be conditioned upon such Holder's participation in such underwriting and
the inclusion of such Holder's Registrable Securities in the underwriting to the
extent provided herein. All Holders proposing to distribute their Registrable
Securities through such underwriting (together with the Company and other
holders distributing their securities through such underwriting) shall enter
into an underwriting agreement in customary form with the underwriter or
underwriters selected for such underwriting. Notwithstanding any other provision
of this Agreement, if the underwriter determines in good faith that marketing
factors require a limitation of the number of shares to be underwritten, the
number of shares that may be included in the underwriting shall be allocated,
first, to the Company; second, to the Holders on a pro rata basis based on the
total number of Registrable Securities held by the Holders; and third, to any
stockholder of the Company (other than a Holder) on a pro rata basis. No such
reduction shall reduce the securities being offered by the Company for its own
account to be included in the registration and underwriting, except that in no
event shall the amount of securities of the selling Holders included in the
registration be reduced below thirty percent (30%) of the total amount of
securities included in such registration, unless such offering is the first
underwritten public offering of the Company's securities and such registration
does not include shares of any other selling stockholders, in which event any or
all of the Registrable Securities of the Holders may be excluded in accordance
with the immediately preceding sentence. In no event will shares of any other
selling stockholder be included in such registration which would reduce the
number of shares which may be included by Holders without the written consent of
Holders of not less than a majority of the Registrable Securities proposed to be
sold in the offering. If any Holder disapproves of the terms of any such
underwriting, such Holder may elect to withdraw therefrom by written notice to
the Company and the underwriter. Any securities excluded or withdrawn from such
underwriting shall be withdrawn from such registration.

     3.3  Form S-3 Registration Rights. After the Company's initial registered
underwritten public offering, the Company shall use its best efforts to qualify
for registration on Form S-3, and to that end the Company shall use its best
efforts to comply with the reporting requirements of the Securities Exchange Act
of 1934, as amended (the "Securities Exchange Act"), within twelve (12) months
following the effective date of the first registration of any

                                       6.

<PAGE>

securities of the Company for an underwritten registered public offering. After
the Company has qualified for the use of Form S-3, and subject to the provisions
of Section 3.10, each Holder shall have the right to request registrations on
Form S-3 (such requests shall be in writing and shall state the number of shares
of Registrable Securities to be disposed of and the intended method of
disposition of such shares by each such Holder), subject only to the following
limitations:

          (a)  The Company shall be obligated to effect only two (2) such
registrations on Form S-3 in any twelve month period;

          (b)  The Company shall not be obligated to cause a registration on
Form S-3 to become effective prior to one hundred eighty (180) days following
the effective date of a Company initiated registration (other than a
registration effected solely to qualify an employee benefit plan on Form S-8 or
to effect a business combination pursuant to Rule 145 of the Securities Act
("Rule 145"));

          (c)  The Company shall not be required to effect a registration
pursuant to this Section 3.3 unless the Holder or Holders requesting such a
registration propose to dispose of shares of Registrable Securities having an
aggregate disposition price (net of Selling Expenses) of at least $1,000,000;

          (d)  The Company shall not be required to effect a registration
pursuant to this Section 3.3 if the Company shall furnish to the requesting
Holders a certificate signed by the President of the Company stating that in the
good faith judgment of the Board of Directors of the Company it would be
seriously detrimental to the Company or its Holders for the registration
statement to be filed at the date filing would be required, in which case the
Company shall have an additional period of not more than one hundred eighty
(180) days within which to file such registration statement; provided however,
that the Company shall not use this right more than once in any twelve (12)
month period; and

          (e)  The Company shall not be required to maintain and keep any such
registration on Form S-3 effective for a period exceeding one hundred and twenty
(120) days from the effective date thereof.

     The Company shall give notice to all Holders of the receipt of a request
for registration pursuant to this Section 3.3 and shall use its best efforts to
cause all Registrable Securities that such Holders have requested, within 15
days after receipt of such written notice, be registered in accordance with this
Section 3.3 to be registered under the Securities Act. Subject to the foregoing,
the Company will use its best efforts to effect promptly any registration
pursuant to this Section 3.3. The provisions of Section 3.1(b) shall apply to
any registration effected pursuant to this Section 3.3.

     3.4  Expenses of Registration. All Registration Expenses incurred in
connection with any registration, qualification or compliance pursuant to
Sections 3.1, 3.2 and 3.3 (exclusive of Selling Expenses but inclusive of the
reasonable fees and expenses of one special counsel to the selling Holders)
shall be borne by the Company. Notwithstanding anything to the contrary herein,
the Company shall not be required to pay for any expenses of any registration
proceeding under Section 3.1 if the registration request is subsequently
withdrawn at the request of the

                                       7.

<PAGE>

Holders of a majority of the Registrable Securities to have been registered,
unless such Holders agree to forfeit their right to a demand registration
pursuant to Section 3.1 (in which event such right shall be forfeited by all
Holders). In the absence of such an agreement to forfeit, the Holders of
Registrable Securities to have been registered shall bear all such expenses pro
rata on the basis of the Registrable Securities to have been registered.
Notwithstanding the foregoing, however, if at the time of the withdrawal, the
Holders have learned of a material adverse change in the condition, business, or
prospects of the Company from that known to the Holders at the time of their
request, of which the Company had knowledge at the time of the request, then the
Holders shall not be required to pay any of said expenses and shall retain their
rights pursuant to Section 3.1.

     3.5  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)  Keep such registration, qualification or compliance effective for
a period of 120 days or until the Holder or Holders have completed the
distribution described in the registration statement relating thereto, whichever
first occurs;

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

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

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

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

                                       8.

<PAGE>

     Notwithstanding any provision to the contrary in this Agreement, the
Company shall not be required in connection with any registration pursuant to
Sections 3.1, 3.2 or 3.3 to qualify shares in any state or jurisdiction which
requires the Company to qualify to do business or to file a general consent to
service of process.

     3.6  Indemnification.

          (a)  The Company will indemnify each Holder, each of its officers and
directors and partners, and each person controlling such Holder within the
meaning of Section 15 of the Securities Act, with respect to which registration,
qualification or compliance has been effected pursuant to this Section 3,
against all expenses, claims, losses, damages and 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 the light of the circumstances in which they were
made, not misleading, or any violation by the Company of any rule or regulation
promulgated under the Securities Act applicable to the Company and relating to
action or inaction required of the Company in connection with any such
registration, qualification or compliance, and will reimburse each such Holder,
each of its officers and directors and partners, and each person controlling
such Holder, 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 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 and
officers, each person who controls the Company or such underwriter within the
meaning of Section 15 of the Securities Act, and each other such Holder, each of
its officers and directors and partners and each person controlling such Holder
within the meaning of Section 15 of the Securities Act, against all expenses,
claims, losses, damages and 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 such 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 the light of the circumstances in which they were made, not
misleading, or any violation by the Company of any rule or regulation
promulgated under the Securities Act applicable to the Company in connection
with any such registration, qualification, or compliance, and will reimburse the
Company, such Holders, such directors, officers, partners, persons, or control
persons for any legal or any other expenses reasonably

                                       9.

<PAGE>

incurred in connection with investigating, preparing 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 or any amendment or supplement
thereto 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; provided, however, that the obligations of such
Holders hereunder shall be limited to an amount equal to the net proceeds to
each such Holder of Registrable Securities sold as contemplated herein.

          (c)  Each party entitled to indemnification under this Section 3.6
(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 be unreasonably
withheld), and the Indemnified Party may participate in such defense at its own
expense; provided, however, that an Indemnified Party (together with all other
indemnified parties which may be represented without conflict by one counsel)
shall have the right to retain one separate counsel, with the fees and expenses
to be paid by the Indemnifying Party, if representation of such Indemnified
Party by the counsel retained by the Indemnifying Party would be inappropriate
due to actual or potential conflicts of interests between such Indemnified Party
and any other party represented by such counsel in such proceeding. The failure
of any Indemnified Party to give notice as provided herein shall not relieve the
Indemnifying Party of its obligations under this Section 3.6 unless such failure
resulted in actual detriment to the Indemnifying Party. 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 a release from all liability
in respect of such claim or litigation.

          (d)  If the indemnification provided for in this Section 3.6 is held
by a court of competent jurisdiction to be unavailable to an Indemnified Party
with respect to any loss, liability, claim, damage, or expense referred to
therein, then the Indemnifying Party, in lieu of indemnifying such Indemnified
Party hereunder, shall contribute to the amount paid or payable by such
Indemnified Party as a result of such loss, liability, claim, damage, or expense
in such proportion as is appropriate to reflect the relative fault of the
Indemnifying Party on the one hand and of the Indemnified Party on the other in
connection with the statements or omissions that resulted in such loss,
liability, claim, damage, or expense as well as any other relevant equitable
considerations. The relative fault of the Indemnifying Party and of the
Indemnified Party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission to state a material fact relates to information supplied by the
Indemnifying Party or by the Indemnified Party and the parties relative intent,
knowledge, access to information, and opportunity to correct or prevent such
statement or omission.

                                       10.

<PAGE>

          (e)  The obligations of the Company and Holders under this Section 3.6
shall survive the completion of any offering of Registrable Securities in a
registration statement under this Section 3.

     3.7  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 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.

     3.8  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:

          (a)  Use its best efforts to 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 of the first registration
under the Securities Act filed by the Company for an offering of its securities
to the general public;

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

          (c)  So long as an Holder owns any Restricted Securities, to furnish
to such Holder 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) and of
the Securities Act and the Securities Exchange Act (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 as an Holder may reasonably request in availing itself of any rule or
regulation of the Commission allowing an Holder to sell any such securities
without registration.

     3.9  Transfer of Registration Rights. The rights to cause the Company to
register securities granted under Sections 3.1, 3.2 and 3.3 may be assigned or
otherwise conveyed to a transferee or assignee of Registrable Securities, who
shall be considered a "Holder" for purposes of this Section 3, provided that (a)
such transfer is effected in accordance with applicable federal and state
securities laws, (b) the Company is given written notice by such Holder at the
time of or within a reasonable time after said transfer, stating the name,
address and a reasonably detailed description of the principal business or
occupation of said transferee or assignee and any such other information as is
reasonably requested by the Company in order to carry out the intent of these
provisions and identifying the securities with respect to which such
registration rights are being assigned, (c) the Company reasonably determines
that the proposed transferee or assignee is not a direct competitor or future
competitor of the Company and (d) such transferee or assignee (i) is a Holder,
(ii) is an affiliate of a Holder, including a wholly-owned subsidiary or
constituent partner (including limited partners and partners who retire from a
transferror

                                       11.

<PAGE>

partnership after the date hereof) of the transferring Holder, (iii) is a family
member of the transferring Holder, (iv) is a trust for the benefit of an
individual transferror or his family members, or (v) acquires at least 50,000
shares (as presently constituted) of the Registrable Securities held by the
transferring Holder. No such transfer or assignment shall be valid or effective
unless the proposed transferee or assignee expressly agrees to be subject to all
of the provisions of this Agreement relating to such rights, including without
limitation the provisions of Sections 3.6 and 3.11 of this Agreement.

     3.10  Termination of Registration Rights. The registration rights granted
pursuant to this Section 3 shall terminate (i) upon the fifth anniversary of the
effective date of the first registration statement filed by the Company covering
a firm commitment underwritten offering of its securities to the general public,
which offering has closed, or (ii) if earlier, as to any individual Holder, at
such time after the Company's initial registered public offering as all
Registrable Securities held by such Holder can be sold without compliance with
the registration requirements of the Securities Act pursuant to Rule 144(k)
promulgated thereunder and such Holder owns less than 1% of the Company's
outstanding capital stock.

     3.11  "Market Stand Off" Agreement. Each Holder and each Founder hereby
agrees that it shall not, to the extent requested by the Company and an
underwriter of Common Stock (or other securities) of the Company, sell or
otherwise transfer or dispose of (other than to those who agree to be similarly
bound) any Registrable Securities, Founders' Shares, or any other securities of
the Company for a period (the "Stand Off Period") of up to one hundred eighty
(180) days following the effective date of a registration statement of the
Company filed under the Securities Act; provided, however, that (i) such
agreement shall only be applicable to the first such registration statement of
the Company which covers shares (or securities) to be sold on its behalf to the
public in an underwritten offering; and (ii) the length of the Stand Off Period
shall not exceed the shortest period of time agreed to by any officer, director
or 5% holder of the Company.

     In order to enforce the foregoing covenant, the Company may impose
stop-transfer instructions with respect to the Registrable Securities of Holders
and Founders (and the shares or securities of every other person subject to the
foregoing restriction) until the end of the Stand Off Period.

     3.12  Inclusion of Stock Held by Founders and Common Stock held by Holders.
In connection with any registration effected pursuant to Section 3.2 hereof,
each of the Founders and each of the Holders, with respect to shares of Common
Stock of the Company that are held by the Founders and the Holders and are not
"Registrable Securities" for purposes of this Agreement, shall be entitled to
participate in such registration, on the same terms and conditions as Holders
selling their Registrable Securities in such registration and, for purposes of
Section 3.2, (i) each such Founder and Holder shall be entitled to all of the
rights and shall be subject to all of the obligations applicable to a Holder in
connection with such registration, including without limitation the provisions
of Sections 3.6 and 3.11 of this Agreement, (ii) all such securities, and any
shares of Common Stock issued in respect thereof upon any stock split, stock
dividend, recapitalization or similar event, shall be deemed to be "Registrable
Securities," (iii) all references to "Holder" in this Agreement shall be deemed
to include such Founder and Holder

                                       12.

<PAGE>

for purposes of such registration and (iv) any Underwriter Cutback shall apply
pro rata to the shares so included by the Founders and Holders participating in
such registration.

     3.13 Limitations on Subsequent Registration Rights. From and after the
date of this Agreement, the Company shall not, without the prior written consent
of Holders holding more than fifty percent (50%) of the Registrable Securities,
enter into any agreement with any holder or prospective holder of any securities
of the Company which would allow such holder or prospective holder to (i)
require the Company to effect a registration or (ii) include any securities in
any registration filed under Sections 3.1, 3.2 or 3.3 hereof unless, under the
terms of such agreement, such holder or prospective holder may include such
securities in any such registration only to the extent that the inclusion of
such securities will not diminish the amount of Registrable Securities which are
included in such registration, and such agreement includes the equivalent of
Section 3.11 as a term.

                                   ARTICLE 4

                      AFFIRMATIVE COVENANTS OF THE COMPANY

     4.1  Financial Information. The Company will furnish the following reports
to each Holder for so long as such Holder is a holder of (or is entitled to
purchase under this Agreement) at least 100,000 shares of Preferred or Common
Stock issued upon conversion of the Preferred or a combination thereof (a
"Significant Holder"):

          (a)  As soon as practicable after the end of each fiscal year, audited
consolidated balance sheets of the Company and its subsidiaries, if any, as of
the end of such fiscal year, and a consolidated statement of operations and a
consolidated statement of cash flow of the Company and its subsidiaries, if any,
for such year, prepared in accordance with generally accepted accounting
principles and setting forth in each case in comparative form the figures for
the previous fiscal year, all in reasonable detail and certified by independent
public accountants of recognized national standing selected by the Company; and

          (b)  As soon as practicable after the end of each fiscal quarter and
in any event within 45 days thereafter, an unaudited consolidated balance sheet
of the Company and its subsidiaries, if any, as of the end of each such quarter,
and a consolidated statement of operations and a consolidated statement of cash
flow of the Company and its subsidiaries for such period and for the year to
date, prepared in accordance with generally accepted accounting principals,
subject to changes resulting from year-end audit adjustments.

     4.2  Inspection. The Company shall permit each Holder, at such Holder's
expense, to visit and inspect the Company's properties, to examine its books of
account and records and to discuss the Company's affairs, finances and accounts
with its officers, all at such reasonable times as may be requested by the
Holder; provided, however, that the Company shall not be obligated pursuant to
this Section 4.2 to provide access to any information which it reasonably
considers to be a trade secret or similar confidential information.

     4.3  Assignment of Rights to Financial Information. The rights granted
pursuant to Section 4.1 may be assigned by Holders (or by any permitted
transferee of any such rights) only

                                       13.

<PAGE>

in connection with the transfer to a single transferee of not less than 100,000
shares of Preferred or Common Stock issued upon conversion thereof or a
combination thereof (including, for such purposes, transfers by affiliates of a
transferror) and only so long as (i) the Company is given notice of any such
assignment within thirty (30) days of the date the same is effected, which
notice shall disclose the name of such assignee and provide a reasonably
detailed description of such assignee's business or principal occupation and the
circumstances surrounding such assignment, (ii) the Company reasonably
determines that the assignee is not a direct competitor or potential competitor
of the Company and (iii) if the Company reasonably believes that it is necessary
to protect proprietary information, the Company may require that the assignee
execute a confidentiality agreement as a condition to receiving such
information.

     4.4  Attendance at Board Meetings. Each Significant Holder (or its
representative) shall have the right to attend all meetings of the Board of
Directors in a nonvoting observer capacity, to receive notice of such meetings
and to receive the information provided by the Company to the Board of
Directors; provided, however, that each person proposing to attend any meeting
of the Board of Directors and each person to have access to any of the
information provided by the Company to the Board of Directors shall agree to
hold in confidence and trust and to act in a fiduciary manner with respect to
all information so received during such meeting or otherwise; and, provided
further, that the Company reserves the right not to provide information and to
exclude such Significant Holder (or its representative) from any meeting or
portion thereof if delivery of such information or attendance at such meeting by
such Significant Holder (or its representative) would result in disclosure of
trade secrets to such Significant Holder (or its representative) or would
adversely affect the attorney-client privilege between the Company and its
counsel or if such Significant Holder (or its representative) is a direct
competitor of the Company.

     4.5  Compensation Committee. The Series A Preferred (voting as a class) and
the Series B Preferred (voting as a class) shall each have the right to appoint
one member, which member shall be satisfactory to the other series of Preferred,
to the compensation committee of the Board of Directors (the "Compensation
Committee"), which shall initially consist of two members which shall be Robert
G. McNeil and Michael A. Henos. The size and composition of the Compensation
Committee shall not be changed without the consent of the Series A Preferred
(voting as a class) and the Series B Preferred (voting as a class). The rights
granted to the Series A Preferred and the Series B Preferred pursuant to this
Section 4.5 shall terminate on the second anniversary of the initial closing of
the purchase and sale of Series B Preferred.

     4.6  Sales of Series B Preferred. The Company shall not sell any shares of
Series B Preferred after December 31, 1995, unless the Company has received a
letter of intent to purchase shares of Series B Preferred, dated as of or prior
to such date, in which case the Company may sell shares of Series B Preferred
pursuant to such letter of intent after such date.

     4.7  Termination of Covenants. The covenants and rights set forth in
Sections 4.1 and 4.4 shall terminate and be of no further force or effect after
the earlier of the date upon which the first registration statement filed by the
Company under the Securities Act in connection with the firm commitment
underwritten public offering of its securities becomes effective, which offering
has closed.

                                       14.

<PAGE>

                                   ARTICLE 5

            AFFIRMATIVE COVENANTS OF HOLDERS; RIGHT OF FIRST REFUSAL

     5.1  Confidential Information, etc. Each Holder agrees that all information
received by it pursuant to Section 4, and any other information relating to the
Company's technology, processes or formulas that is disclosed by the Company to
any Holder in writing and is marked "Confidential," shall be considered
confidential information. Each Holder further agrees that it shall hold all
confidential information relating to the Company in confidence and shall not
disclose any such confidential information to any third party other than its
counsel or accountants nor shall such Holder use such confidential information
for any purpose other than evaluation of such Holder's investment in the
Company; provided, however, that the foregoing obligation to hold in confidence
and not to disclose confidential information shall not apply to any such
information that (a) was known to the public prior to disclosure by the Company,
(b) becomes known to the public through no fault of such Holder, (c) is
disclosed to such Holder on a non-confidential basis by a third party having a
legal right to make such disclosure or (d) is independently developed by such
Holder.

     5.2  Right of First Refusal. The Company hereby grants to each Purchaser
(defined below) the right of first refusal to purchase its Pro Rata Share
(defined below) of all (or any part) of any New Securities (defined below) that
the Company may from time to time propose to sell and issue. Such Purchaser's
"Pro Rata Share," for purposes of this right of first refusal, is the ratio of
the number of shares of Common Stock (assuming conversion to Common Stock of all
shares of the Preferred) then held by such Purchaser to the total number of
shares of Common Stock then outstanding (assuming conversion to Common Stock of
all outstanding shares of the Company's Preferred Stock). This right of first
refusal shall be subject to the following provisions:

          (a)  "Purchaser" shall mean, with respect to any issuance of New
Securities of the Company, each Founder who then holds any Common Stock and each
Holder who then holds any Preferred (or Common Stock issued upon conversion
thereof) or any Common Shares.

          (b)  "New Securities" shall mean any Common Stock or Preferred Stock
of the Company, whether now authorized or not, and rights, options or warrants
to purchase said Common Stock or Preferred Stock, and securities of any type
whatsoever that are, or may become, convertible into or exchangeable for said
Common Stock or Preferred Stock; provided, however, that "New Securities" does
not include (i) securities issuable upon conversion of or with respect to the
Preferred or any future series of Preferred Stock of the Company; (ii)
securities offered to the public pursuant to a registration statement filed
under the Securities Act; (iii) securities issued pursuant to the acquisition of
another corporation or other business entity by the Company by merger, purchase
of all or substantially all of the assets or other reorganization; (iv) up to
500,000 shares of the Company's Common Stock or other securities (or related
options) issued to directors, officers or employees of, or consultants to, the
Company pursuant to an agreement or an option or purchase plan or another
director, officer, employee or consultant stock incentive program approved by
the Board of Directors of the Company; (vi) shares of the Company's Common Stock
or Preferred Stock issued in connection with any stock split, stock dividend, or
recapitalization by the Company; (vii) securities issued to persons or

                                       15.

<PAGE>

entities in connection with bank or equipment lease financing, technology
licensing or corporate partnering transactions and the like approved by the
Board of Directors of the Company; and (viii) shares of Preferred issued
pursuant to the Series B Agreement.

          (c)  In the event that the Company proposes to undertake an issuance
of New Securities, it shall give each Purchaser written notice of its intention,
describing the type of New Securities, the price, and the general terms upon
which the Company proposes to issue the same. Each Purchaser shall have ten (10)
days from the date of delivery of any such notice to agree to purchase his Pro
Rata Share of such New Securities for the price and upon the general terms
specified in the notice by giving written notice to the Company and stating
therein the quantity of New Securities to be purchased.

          (d)  In the event that Purchasers fail to exercise in full the right
of first refusal within said ten (10) day period, the Company shall have sixty
(60) business 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 sixty (60) business days from the date of said agreement) the New
Securities respecting which the Purchasers' rights were not exercised, at a
price and upon general terms no more favorable to the purchasers thereof than
specified in the Company's notice. In the event the Company has not sold the New
Securities within said sixty (60) business day period (or sold and issued new
Securities in accordance with the foregoing within sixty (60) business days from
the date of said agreement), the Company shall not thereafter issue or sell any
New Securities, without first offering such securities to the Purchasers in the
manner provided above.

          (e)  The right of first refusal granted under this Agreement shall
expire upon the earlier of (i) the closing of the Company's first underwritten
public offering of Common Stock pursuant to a registration statement declared
effective under the Securities Act, or (ii) a merger, acquisition or other
change in control of the Company. As used herein, "change of control" means the
occurrence of an event that results in the existing stockholders of the Company,
just prior to the event, owning less than 50% of the voting power of the
Company, as measured just following the event.

          (f)  This right of first refusal is nonassignable except to any other
Purchaser or to any parent, subsidiary or general or limited partner of any
Purchaser.

                                   ARTICLE 6

                                  MISCELLANEOUS

     6.1  Governing Law. This Agreement shall be governed by the laws of the
State of California as applicable to contracts entered into and performed
entirely within the State of California.

     6.2  Successors and Assigns. Except as otherwise provided herein, the
provisions hereof shall inure to the benefit of, and be binding upon, the
successors, assigns, heirs, executors and administrators of the parties hereto.

                                       16.

<PAGE>

     6.3  Entire Agreement. This Agreement constitutes the full and entire
understanding and agreement between the parties with regard to the subject
matter hereof.

     6.4  Rights of Holders. Each Holder and Founder shall have the absolute
right to exercise or refrain from exercising any right or rights that such
Holder or Founder may have by reason of this Agreement or the ownership of any
Preferred or Common Stock, including without limitation the right to consent to
the waiver of any obligation of the Company under this Agreement to such Holder
or Founder and to enter into an agreement with the Company for the purpose of
modifying this Agreement or any agreement affecting any such modification, and
such Holder or Founder shall not incur any liability to any other Founder,
Holder or holders of Preferred with respect to exercising or refraining from
exercising any such right or rights.

     6.5  Notices, etc. All notices and other communications required or
permitted hereunder shall be in writing and shall be mailed by registered or
certified mail, postage prepaid, or facsimile or otherwise delivered by hand or
by messenger, addressed (a) if to a Holder or Founder, at such Holder's or
Founder's address set forth below or at such other address as such Holder or
Founder shall have furnished to the Company in writing, (b) if to any other
holder of Preferred, at such address as such holder shall have furnished the
Company in writing or (c) if to the Company, one copy shall be sent to its
address set forth above and addressed to the attention of the President and
another copy shall be sent to Cooley Godward Castro Huddleson & Tatum, 5 Palo
Alto Square, 4th Floor, Palo Alto, California 94306, Attention: Alan C.
Mendelson, Esq., or at such other addresses as the Company shall have furnished
to the Holders and the Founders. All notices and other communications mailed or
sent by facsimile pursuant to the provisions of this Section 6.5 shall be deemed
delivered when mailed or sent by facsimile, provided, if sent by facsimile,
confirmation of receipt is ascertained and a copy of the notice is concurrently
mailed to the addressee thereof by U.S. Mail.

     6.6  Counterparts. This Agreement may be executed in counterparts, each of
which shall be enforceable against the party actually executing such
counterpart, and which together shall constitute one instrument.

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

     6.8  Approval of Amendments and Waivers. Any term of this agreement may be
amended or terminated and the observance of any term of this Agreement may be
waived (either generally or in a particular instance and either retroactively or
prospectively) with the written consent of the Company and Holders (or their
transferees) holding at least a majority of the then outstanding shares of
Registrable Securities, excluding from the determination of such a majority
(both in determining the total number of such shares outstanding and the number
of such shares consenting or not consenting) all shares previously disposed of
by Holders or their transferees pursuant to one or more registration statements
under the Securities Act or pursuant to Rule 144 thereunder; provided, however,
that no such amendment or waiver shall adversely affect the right of any Founder
to participate in registrations under Section 3.2 of this Agreement as provided
for in Section 3.12 without such Founder's written consent; it being understood,
however, that the

                                       17.

<PAGE>

amendment of this Agreement to increase the number of shares defined as
Registrable Securities or to add additional parties as Holders shall be deemed
not to adversely affect such right under Section 3.2. Any amendment, termination
or waiver effected in accordance with this section shall be binding upon each
Founder, each Holder, each of their transferees and the Company. Each Founder
and each Holder acknowledges that by the operation of this Section 6.8 the
Holders of a majority of the outstanding Registrable Securities may have the
right and power to diminish or eliminate all rights of such Holder under this
Agreement as provided for above.

                                       18.

<PAGE>

         The Foregoing Agreement is hereby executed as of the date first above
written.

The Company:

Discovery Therapeutics, Inc.

By   /s/ Donald A. McAfee
  -----------------------------------------

Title    President
     --------------------------------------


                                       19.

<PAGE>

The Founders:

               /s/  Donald McAfee
---------------------------------------
Donald McAfee

Address:  _____________________________
          _____________________________


               /s/  Noel Cusack
---------------------------------------
Noel Cusack

Address:  _____________________________
          _____________________________


               /s/ James Peck
---------------------------------------
James Peck

Address:  _____________________________
          _____________________________



Gevork Minaskanian


               /s/  Gevork Minaskanian
---------------------------------------

Address:
          _____________________________
          _____________________________


                                       20.

<PAGE>

Sanderling Venture Partners III

Sanderling III Biomedical

Sanderling III Limited

Sanderling Ventures Management

By        /s/
   ----------------------------------------------
          On behalf of and as General Partner
          of each of the above-entitled entities

Address:  c/o Marc Prisant
          2730 Sand Hill Road, Suite 200
          Menlo Park, CA 94025

                                       21.

<PAGE>

The Investors:

Sanderling Venture Partners III

Sanderling III Biomedical

Sanderling III Limited

Sanderling Ventures Management

By                   /s/
           --------------------------------------
           On behalf of and as General Partner
           of each of the above-entitled entities

Address:   c/o Marc Prisant
           2730 Sand Hill Road, Suite 200
           Menlo Park, CA 94025


Alliance Technology Ventures, L.P.


By          /s/ Michael Henos
   ----------------------------------------------

Title           General Partner
     --------------------------------------------

ATV/MFJ Parallel Fund, L.P.


By          /s/ Michael Henos
   ----------------------------------------------

Title           General Partner
     --------------------------------------------

ATV/GP Parallel Fund, L.P.


By          /s/ Michael Henos
   ----------------------------------------------

Title           General Partner
     --------------------------------------------

Address: c/o Michael Henos
         3343 Peachtree Road
         East Tower, Suite 1140
         Atlanta, GA 30326

                                       22.

<PAGE>

Gc&H Investments

By     /s/
  -------------------------------------------


Title          Executive Partner
     ----------------------------------------

Address:      c/o John Cardoza
              Cooley Godward Castro Huddleson & Tatum
              One Maritime Plaza
              20th Floor
              San Francisco, CA 94111-3580

                                       23.

<PAGE>

                          DISCOVERY THERAPEUTICS, INC.
                                  AMENDMENT TO
                       RESTATED INVESTOR RIGHTS AGREEMENT


     This Amendment (the "Amendment") to the Restated Investor Rights Agreement,
dated as of March 31, 1995 (the "Restated Investor Rights Agreement"), between
Discovery Therapeutics, Inc., a Delaware corporation (the "Company"), and the
undersigned parties thereto (the "Initial Investors"), is made and entered into
as of this 3rd day of November, 1995, by and among the Company, the undersigned
additional investor (the "Additional Investor") and certain of the Initial
Investors.

     Whereas, the Additional Investor has purchased shares of the Company's
Series B Preferred Stock (the "Shares") pursuant to that certain Series B
Preferred Stock Purchase Agreement, dated March 31, 1995, by and among the
Company and the purchasers listed on Exhibit A attached thereto, as amended by
that certain Amendment to Series B Preferred Stock Purchase Agreement of even
date herewith (the "Purchase Agreement"); and

     Whereas, the Company and certain of the Initial Investors which are parties
hereto wish to amend the Restated Investor Rights Agreement to add the
Additional Investor as a party thereto pursuant to this Amendment.

     Now Therefore, in consideration of the mutual agreements, covenants and
considerations contained herein, the undersigned hereby agree as follows:

     1.  The Restated Investor Rights Agreement is hereby amended to include the
Additional Investor as an Investor thereunder, with the Additional Investor
agreeing to be bound by all terms and conditions therein and being entitled to
all the benefits thereof.

     2.  The Initial Investors hereby waive the right of first refusal granted
to such parties under Section 5.2 of the Restated Investor Rights Agreement (and
the notice periods with respect thereto) with respect to, and only with respect
to, the issuance of the Shares to the Additional Investor pursuant to the
Purchase Agreement.

     3.  This Amendment may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.

     4.  Except as hereby expressly amended, the Restated Investor Rights
Agreement shall remain in full force and effect pursuant to its terms.

     5.  Capitalized terms used herein but not otherwise defined shall have the
meanings assigned to such terms in the Restated Investor Rights Agreement.

                                       1.

<PAGE>

     In Witness Whereof, the undersigned have executed this Amendment as of the
day and year first set forth above.

Discovery Therapeutics, Inc.            Additional Purchaser:

                                        New York Life Insurance Company

By: /s/ Donald A. McAfee
   ------------------------------
     Donald A. McAfee, President        By:__________________________________

                                        Title:_______________________________


                                        Initial Investors:

                                        Sanderling Venture Partners III
                                        Sanderling III Biomedical
                                        Sanderling III Limited Partnership
                                        Sanderling Ventures Management


                                        By:__________________________________

                                        Title:_______________________________


                                        Alliance Technology Ventures, L.P.
                                        ATV/GP Parallel Fund, L.P.
                                        ATV/MFJ Parallel Fund, L.P.


                                        By:__________________________________

                                        Title:_______________________________



                Amendment to Restated Investor Rights Agreement

<PAGE>

                          Discovery Therapeutics, Inc.
                              Second Amendment to
                       Restated Investor Rights Agreement

        This Second Amendment (the "Second Amendment") to the Restated Investor
Rights Agreement dated as of March 31, 1995 (the "Rights Agreement"), between
Discovery Therapeutics, Inc., a Delaware corporation (the "Company"), and the
undersigned parties thereto, and New York Life Insurance Company (the "Initial
Investors"), is made and entered into as of this 21st day of June, 1999, by and
among the Company, the undersigned shareholders of Renalogics, Inc. a Georgia
Corporation (the "Additional Investors") and certain of the Initial Investors.

        Whereas, on March 31, 1995 the Company entered into a Restated Investor
Rights Agreement (the "Rights Agreement") with four (4) of its founders (the
"Founders") and certain named investors (the "Initial Investors") pursuant to
which the Company granted to the Founders and the Initial Investors a right of
first refusal to purchase a pro rata share of all New Securities (as defined in
the Rights Agreement) that the Company may from time to time propose to sell and
issue;

        Whereas, on November 3, 1995, the Company entered into an Amendment to
the Rights Agreement, which defined New York Life Insurance Company as an
Additional Investor under the Rights Agreement, subject to the registration,
information and other rights set forth therein;

        Whereas, the Rights Agreement defined New Securities and excluded from
said definition, among other things, up to 500,000 shares of the Company's
Common Stock or other securities (or related options) issued to directors,
officers or employees of, or consultants to, the Company pursuant to an
agreement or an option to purchase plan or another director, officer, employee
or consultant stock incentive program approved by the Board of Directors of the
Company;

        Whereas, the Company, the Founders, and the Investors, now wish to amend
the Rights Agreement a second time to increase the number of shares reserved for
issuance to directors, officers or employees of, or consultants to, the Company
from five hundred thousand (500,000) shares to one million (1,000,000) shares;

        Whereas, the Company has entered into that certain Stock Purchase
Agreement among the Company, Renalogics, Inc., and the shareholders of
Renalogics, Inc. (the "Renalogics Agreement") pursuant to which the shareholders
of Renalogics shall swap 100% of the outstanding capital stock of Renalogics for
a maximum of two hundred fifty nine thousand one hundred sixty one (259,161)
shares of Common Stock and two hundred ninety six thousand six hundred seventy
eight (296,678) shares of Series B Preferred Stock of the Company;

        Whereas, the Company and certain of the Initial Investors, which are
parties hereto, wish to amend the Restated Investor Rights Agreement so that
those shareholders of Renalogics who receive shares of the Company's Series B
Preferred Stock under the Renalogics Agreement are defined as Investors under
the Rights Agreements;

                                       1.

<PAGE>

        Now Therefore, in consideration of the mutual agreements, covenants and
considerations contained herein, the undersigned hereby agree as follows:

        1.      Section 5.2(b) of the Rights Agreement shall be amended and
restated to read in its entirety as follows:

                "New Securities" shall mean any Common Stock or Preferred Stock
                of the Company, whether now authorized or not, and rights,
                options, or warrants to purchase said Common Stock or Preferred
                Stock, and securities of any type whatsoever that are, or may
                become, convertible into or exchangeable for said Common Stock
                or Preferred Stock; provided, however, that "New Securities"
                does not include (i) securities issuable upon conversion of or
                with respect to the Preferred or any future series of Preferred
                Stock of the Company; (ii) securities offered to the public
                pursuant to a registration statement filed under the Securities
                Act; (iii) securities issued pursuant to the acquisition of
                another corporation or other business entity by the Company by
                merger, purchase of all or substantially all of the assets or
                other reorganization; (iv) up to one million (1,000,000) shares
                of the Company's Common Stock or other securities (or related
                options) issued to directors, officers or employees of, or
                consultants to, the Company pursuant to an agreement or an
                option or purchase plan or another director, officer, employee
                or consultant stock incentive program approved by the Board of
                Directors of the Company; (vi) shares of the Company's Common
                Stock or Preferred Stock issued in connection with any stock
                split, stock dividend, or recapitalization by the Company; (vii)
                securities issued to persons or entities in connection with bank
                or equipment lease financing, technology licensing or corporate
                partnering transactions and the like approved by the Board of
                Directors of the Company; and (viii) shares of Preferred issued
                pursuant to the Series B Agreement.

        2.      Effective upon the Closing as defined in the Renalogics
Agreement, the Rights Agreement is hereby amended to include those shareholders
of Renalogics who receive shares of the Company's Series B Preferred Stock under
the Renalogics Agreement as Investors thereunder, with said Renalogics
shareholders agreeing to be bound by all terms and conditions therein and being
entitled to all the benefits thereof.

        3.      This Amendment may be executed in two or more counterparts, each
of which shall be deemed an original, but all of which together shall constitute
one and the same instrument.

        4.      Except as hereby expressly amended, the Rights Agreement shall
remain in full force and effect pursuant to its terms.

                                       2.

<PAGE>

        5.      Capitalized terms used herein but not otherwise defined shall
have the meanings assigned to such terms in the Rights Agreement.



         THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.

                                       3.

<PAGE>

     In Witness Whereof, the undersigned have executed this Amendment as of the
day and year first set forth above.

DISCOVERY THERAPEUTICS, INC.         INITIAL INVESTORS:

                                     New York Life Insurance Company

By: /s/ Donald A. McAfee
    ----------------------------
    Donald A. McAfee, President      By:___________________________

                                     Title:________________________


                                     Sanderling Venture Partners III
                                     Sanderling III Biomedical
                                     Sanderling III Limited Partnership
                                     Sanderling Ventures Management


                                     By:___________________________

                                     Title:________________________


                                     Alliance Technology Ventures, L.P.
                                     ATV/GP Parallel Fund, L.P.
                                     ATV/MFJ Parallel Fund, L.P.


                                     By:___________________________

                                     Title:________________________

                                       4.

<PAGE>

                                    ADDITIONAL INVESTORS:


                                    /s/ Dennis Schafer
                                    -------------------------------------
                                    Dennis Schafer

                                    Address: 2800 Milan Court, Suite 225
                                             Birmingham, AL 35211


                                    Alliance Technology Ventures


                                    By: /s/  Michael A. Henos
                                       ----------------------------------
                                       Michael A. Henos

                                    Title:   General Partner
                                          -------------------------------

                                    Address: 3343 Peachtree Road, N.E.
                                             Suite 1140, East Tower
                                             Atlanta, GA 30326


                                    Atv/GP Parallel Fund


                                   By: /s/  Michael A. Henos
                                       ----------------------------------
                                       Michael A. Henos

                                    Address: 3343 Peachtree Road, N.E.
                                             Suite 1140, East Tower
                                             Atlanta, GA 30326


                                    Atv/MFJ Parallel Fund


                                     By: /s/  Michael A. Henos
                                       ----------------------------------
                                        Michael A. Henos

                                    Address: 3343 Peachtree Road, N.E.
                                             Suite 1140, East Tower
                                             Atlanta, GA 30326

                                       5.

<PAGE>

                                    Intelligent Systems Corporation


                                    By: /s/ Bonnie L. Herron
                                       -----------------------------------
                                       Bonnie L. Herron

                                    Address:  4355 Shackleford Road
                                              Norcross, GA 30093


                                    William M. Spencer, III


                                    By:___________________________________

                                    Address:  3300 Cahaba Road, Suite 105
                                              Birmingham, AL 35223


                                    Portrush Group L.L.C.


                                    By:___________________________________
                                       Roger C. Suttle, Jr., M.D.

                                    Title:________________________________

                                    Address:  414 South Fourth Street
                                              Gadsden, AL 35902


                                    Suttle Bros. Investments, L.L.C.


                                    By:___________________________________
                                       Roger C. Suttle, Jr., M.D.

                                    Title:________________________________


                                    Address:  414 South Fourth Street
                                              Gadsden, AL 35902

                                       6.

<PAGE>

                          Discovery Therapeutics, Inc.
                               Third Amendment to
                       Restated Investor Rights Agreement

     This Third Amendment (the "Third Amendment") to the Restated Investor
Rights Agreement, dated as of March 31, 1995 (the "Rights Agreement"), between
Discovery Therapeutics, Inc., a Delaware corporation (the "Company"), and the
undersigned parties thereto, is made and entered into as of this 21/st/ day of
February, 2001, by and among the Company, the undersigned purchasers of Series D
Preferred Stock of the Company (the "Additional Investors"), and certain of the
Initial Investors (as defined herein).

     Whereas, on March 31, 1995, the Company entered into the Rights Agreement
with four of its founders (the "Founders") and certain named investors (the
"Initial Investors"), pursuant to which the Company granted to the Founders and
the Initial Investors a right of first refusal to purchase a pro rata share of
all New Securities (as defined in the Rights Agreement) that the Company may
from time to time propose to sell and issue;

     Whereas, on November 3, 1995, the Company entered into an Amendment to the
Rights Agreement which defined New York Life Insurance Company as an Additional
Investor under the Rights Agreement, subject to the registration, information,
and other rights set forth therein;

     Whereas, on June 21, 1999, the Company, certain shareholders of Renalogics,
Inc., and certain of the Initial Investors entered into a Second Amendment to
the Rights Agreement which increased the number of shares reserved for issuance
to directors, officers or employees of, or consultants to, the Company and
defined certain shareholders of Renalogics, Inc. as Investors;

     Whereas, the Company has entered into that certain Series D Preferred Stock
Purchase Agreement, dated as of February 21, 2001, by and among the Company and
the Additional Investors (the "Series D Purchase Agreement"), pursuant to which
the Additional Investors shall purchase shares of the Company's Series D
Preferred Stock (the "Shares"); and

     Whereas, the Company and certain of the Initial Investors which are parties
hereto wish to amend the Rights Agreement to add the Additional Investors as
parties thereto pursuant to this Agreement.

     Now Therefore, in consideration of the mutual agreements, covenants and
considerations contained herein, the undersigned hereby agree as follows:

     1.   The definition of "Holder" in Section 1.1 of the Rights Agreement
shall be amended and restated to read in its entirety as follows:

     "Holder" shall mean any Investor or any transferee of registration rights
     under Section 3.9 hereof who then holds any outstanding shares of the
     Company's Series A Preferred Stock, Series B Preferred Stock, or Series D
     Preferred Stock (collectively, the

<PAGE>

     "Preferred") or any Common Shares and any Founder or Investor deemed to be
     a Holder pursuant to Section 3.12, but solely for the purposes set forth
     therein.

     2.   Section 5.2(b) of the Rights Agreement shall be amended and restated
to read in its entirety as follows:

     "New Securities" shall mean any Common Stock or Preferred Stock of the
     Company, whether now authorized or not, and rights, options, or warrants to
     purchase said Common Stock or Preferred Stock, and securities of any type
     whatsoever that are, or may become, convertible into or exchangeable for
     said Common Stock or Preferred Stock; provided, however, that "New
     Securities" does not include (i) securities issuable upon conversion of or
     with respect to the Preferred or any future series of Preferred Stock of
     the Company; (ii) securities offered to the public pursuant to a
     registration statement filed under the Securities Act; (iii) securities
     issued pursuant to the acquisition of another corporation or other business
     entity by the Company by merger, purchase of all or substantially all of
     the assets or other reorganization; (iv) up to one million (1,000,000)
     shares of the Company's Common Stock or other securities (or related)
     options issued to directors, officers or employees of, or consultants to,
     the Company pursuant to an agreement or an option or purchase plan or
     another director, officer, employee or consultant stock incentive program
     approved by the Board of Directors of the Company; (vi) shares of the
     Company's Common Stock or Preferred Stock issued in connection with any
     stock split, stock dividend, or recapitalization by the Company; (vii)
     securities issued to persons or entities in connection with bank or
     equipment lease financing, technology licensing or corporate partnering
     transactions and the like approved by the Board of Directors of the
     Company; and (viii) shares of Preferred issued pursuant to the Series B
     Agreement or that certain Series D Preferred Stock Purchase Agreement,
     dated as of February 21, 2001, by and among the Company and the signatories
     thereto.

     3.   Section 6.5 of the Rights Agreement shall be amended to substitute
"LeClair Ryan, A Professional Corporation, 707 East Main Street, 11/th/ Floor,
Richmond, Virginia 23219, Attention: Gary D. LeClair, Esq." for "Cooley Godward
Castro Huddleson & Tatum, 5 Palo Alto Square, 4/th/ Floor, Palo Alto, California
94306, Attention: Alan C. Mendelson, Esq."

     4.   Effective upon the Closing (as defined in the Series D Purchase
Agreement), the Rights Agreement is hereby amended to include the Additional
Investors as Investors thereunder, with each Additional Investor agreeing to be
bound by all the terms and conditions therein and being entitled to all the
benefits thereof.

     5.   The Initial Investors hereby waive the right of first refusal granted
to such parties under Section 5.2 of the Rights Agreement (and the notice
periods with respect thereto) with respect to, and only with respect to, the
issuance of the Shares to the Additional Investors pursuant to the Series D
Purchase Agreement (and the issuance of any shares of capital stock upon
conversion thereof).

     6.   Notwithstanding anything to the contrary contained herein, if the
Company shall sell additional Shares pursuant to the Series D Purchase
Agreement, any purchaser of such


                                       2

<PAGE>

Shares may become a party to this Third Amendment by executing and delivering an
additional counterpart signature page to this Third Amendment and shall be
deemed an "Additional Investor" hereunder.

     7.   This Third Amendment may be executed in two or more counterparts, each
of which shall be deemed an original, but all of which together shall constitute
one and the same instrument.

     8.   Except as hereby expressly amended, the Rights Agreement shall remain
in full force and effect pursuant to its terms.

     9.   Capitalized terms used herein but not otherwise defined shall have the
meanings assigned to such terms in the Rights Agreement.


         [The Remainder of This Page has Been Intentionally Left Blank.]


                                       3

<PAGE>

     In Witness Whereof, the undersigned have executed this Third Amendment as
of the day and year first set forth above.

DISCOVERY THERAPEUTICS, INC.                 INITIAL INVESTORS:

                                             New York Life BioVenture Partners
By:     /s/ Peter G. Savas                   LLC
   -------------------------------
        Peter G. Savas, President

                                             By: ___________________________

                                             Title: ________________________


                                             Sanderling Venture Partners III
                                             Sanderling III Biomedical
                                             Sanderling III Limited Partnership
                                             Sanderling Ventures Management


                                             By: ___________________________

                                             Title: ________________________


                                             Alliance Technology Ventures, L.P.
                                             ATV/GP Parallel Fund, L.P.
                                             ATV/MFJ Parallel Fund, L.P.


                                             By: ___________________________

                                             Title: ________________________


                                       4

<PAGE>

                                             ADDITIONAL INVESTORS:

                                             [Name]


                                             By: ___________________________

                                             Title: ________________________


                                       5

<PAGE>

                          Discovery Therapeutics, Inc.
                               Fourth Amendment to
                       Restated Investor Rights Agreement

     This Fourth Amendment (the "Fourth Amendment") to the Restated Investor
Rights Agreement, dated as of March 31, 1995 (the "Rights Agreement"), between
Discovery Therapeutics, Inc., a Delaware corporation (the "Company"), and the
parties thereto, is made and entered into as of this ____ day of _________,
2001, by and among the Company and the undersigned parties hereto (the
"Investors").

     Whereas, on March 31, 1995, the Company entered into the Rights Agreement
with four of its founders (the "Founders") and certain named investors (the
"Initial Investors"), pursuant to which the Company granted to the Founders and
the Initial Investors a right of first refusal to purchase a pro rata share of
all New Securities (as defined in the Rights Agreement) that the Company may
from time to time propose to sell and issue;

     Whereas, on November 3, 1995, the Company entered into an Amendment to the
Rights Agreement which defined New York Life Insurance Company as an Additional
Investor under the Rights Agreement, subject to the registration, information,
and other rights set forth therein;

     Whereas, on June 21, 1999, the Company, certain shareholders of Renalogics,
Inc., and certain of the Initial Investors entered into a Second Amendment to
the Rights Agreement which increased the number of shares reserved for issuance
to directors, officers or employees of, or consultants to, the Company pursuant
to an agreement or an option to purchase plan or another director, officer,
employee or consultant stock incentive program approved by the Board of
Directors of the Company and defined certain shareholders of Renalogics, Inc. as
Investors;

     Whereas, as of February 21, 2001, the Company, purchasers of Series D
Preferred Stock of the Company (the "Series D Holders"), and certain of the
Initial Investors entered into a Third Amendment to the Rights Agreement which
defined the Series D Holders as Holders under the Rights Agreement and excluded
from the definition of New Securities shares of Preferred Stock issued pursuant
to the Series D Preferred Stock Purchase Agreement, dated as of February 21,
2001, by and among the Company and the Series D Holders; and

     Whereas, the Company and the undersigned Investors wish to amend the Rights
Agreement to increase the number of shares reserved for issuance to directors,
officers or employees of, or consultants to, the Company pursuant to an
agreement or an option to purchase plan or another director, officer, employee
or consultant stock incentive program approved by the Board of Directors of the
Company from one million (1,000,000) shares to one million five hundred thousand
(1,500,000) shares.

     Now Therefore, in consideration of the mutual agreements, covenants and
considerations contained herein, the undersigned hereby agree as follows:

<PAGE>

     1.   Section 5.2(b) of the Rights Agreement shall be amended and restated
to read in its entirety as follows:

     "New Securities" shall mean any Common Stock or Preferred Stock of the
     Company, whether now authorized or not, and rights, options, or warrants to
     purchase said Common Stock or Preferred Stock, and securities of any type
     whatsoever that are, or may become, convertible into or exchangeable for
     said Common Stock or Preferred Stock; provided, however, that "New
     Securities" does not include (i) securities issuable upon conversion of or
     with respect to the Preferred or any future series of Preferred Stock of
     the Company; (ii) securities offered to the public pursuant to a
     registration statement filed under the Securities Act; (iii) securities
     issued pursuant to the acquisition of another corporation or other business
     entity by the Company by merger, purchase of all or substantially all of
     the assets or other reorganization; (iv) up to one million five hundred
     thousand (1,500,000) shares of the Company's Common Stock or other
     securities (or related) options issued to directors, officers or employees
     of, or consultants to, the Company pursuant to an agreement or an option or
     purchase plan or another director, officer, employee or consultant stock
     incentive program approved by the Board of Directors of the Company; (vi)
     shares of the Company's Common Stock or Preferred Stock issued in
     connection with any stock split, stock dividend, or recapitalization by the
     Company; (vii) securities issued to persons or entities in connection with
     bank or equipment lease financing, technology licensing or corporate
     partnering transactions and the like approved by the Board of Directors of
     the Company; and (viii) shares of Preferred issued pursuant to the Series B
     Agreement or that certain Series D Preferred Stock Purchase Agreement,
     dated as of February 21, 2001, by and among the Company and the signatories
     thereto, as amended.

     2.   This Fourth Amendment may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.

     3.   Except as hereby expressly amended, the Rights Agreement shall remain
in full force and effect pursuant to its terms.

     4.   Capitalized terms used herein but not otherwise defined shall have the
meanings assigned to such terms in the Rights Agreement.


         [THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK.]


                                       2

<PAGE>

     In Witness Whereof, the undersigned have executed this Fourth Amendment as
of the day and year first set forth above.

Discovery Therapeutics, Inc.

By:    /s/ Peter G. Savas
   -------------------------------
       Peter G. Savas, President

INVESTORS:

Alliance Technology Ventures, L.P.
ATV/GP Parallel Fund, L.P.
ATV/MFJ Parallel Fund, L.P.

By: ______________________________
Name: ____________________________
Title: ___________________________



Orbitex Health and Biotechnology ("2V1I")
Orbitex Life Science and Biotechnology Fund ("2VlZ")

By: ______________________________
Name: ____________________________
Title: ___________________________



New York Life BioVenture Partners LLC

By: Perseus Soros BioPharmaceutical Fund
Its: _____________________________

     By: ______________________________
     Name: ____________________________
     Title: ___________________________


Palladin Opportunity Fund LLC

By: ______________________________
Name: ____________________________
Title: ___________________________

                    [SIGNATURES CONTINUE ON FOLLOWING PAGE]


                                       3

<PAGE>

Sanderling III Biomedical, L.P.
Sanderling III Limited Partnership
Sanderling Venture Partners III, L.P.
Sanderling IV Biomedical Co-Investment Fund, L.P.
Sanderling Venture Partners IV Co-Investment Fund, L.P.

By: ______________________________
Name: ____________________________
Title: ___________________________


Sanderling Ventures Management
     FBO Fred A. Middleton

By: ______________________________
Name: ____________________________
Title: ___________________________


Sanderling Management Company, LLC Retirement Trust
     FBO Robert G. McNeil

By: ______________________________
Name: ____________________________
Title: ___________________________


Sanderling Ventures Management

By: ______________________________
Name: ____________________________
Title: ___________________________


Sanderling Venture Partners V Co-Investment Fund, L.P.

By:   Middleton, McNeil & Mills Associates V, LLC
Its:  ____________________________

     By: ______________________________
     Name: ____________________________
     Title: ___________________________

                    [SIGNATURES CONTINUE ON FOLLOWING PAGE]


                                       4

<PAGE>

Singapore Bio-Innovations Pte Ltd.

By: ______________________________
Name: ____________________________
Title: ___________________________



Endpoint Late-Stage Fund, L.P.

By: ______________________________
Name: ____________________________
Title: ___________________________



Schwarz Pharma AG

By: ______________________________
Name: ____________________________
Title: ___________________________

By: ______________________________
Name: ____________________________
Title: ___________________________



China Development Industrial Bank Inc.

By: ______________________________
Name: ____________________________
Title: ___________________________



MDS Life Sciences Technology Fund USA, L.P.

By:  MDS Capital USA (GP) Inc.
Its: General Partner

     By: ______________________________
     Name: ____________________________
     Title: ___________________________

                    [SIGNATURES CONTINUE ON FOLLOWING PAGE]


                                       5

<PAGE>

MDS life Sciences Technology Barbados Investment Trust

By: ______________________________
Name: ____________________________
Title: ___________________________



MDS Life Sciences Technology Fund Limited Partnership

By:  MDS Life Sciences Technology Fund (GP) Inc
Its: General Partner

     By: ______________________________
     Name: ____________________________
     Title: ___________________________



MDS Life Sciences Technology Fund Canadian Unit Trust

By:  MDS Capital Corp
Its: Manager

     By: ______________________________
     Name: ____________________________
     Title: ___________________________



One Objective Ltd.

By: ______________________________
Name: ____________________________
Title: ___________________________



    /s/ Donald A. McAfee
----------------------------------
Donald A. McAfee


    /s/ Noel Cusack
----------------------------------
Noel J. Cusack

                    [SIGNATURES CONTINUE ON FOLLOWING PAGE]


                                       6

<PAGE>

   /s/ James Peck
----------------------------------
James V. Peck


   /s/ Gevork Minaskanian
----------------------------------
Gevork Minaskanian

                                       7