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                                                                   EXHIBIT 10.20

                            NEGATIVE PLEDGE AGREEMENT

         This Negative Pledge Agreement is made as of September 19, 2003, by and
between Novacept, a California corporation ("Borrower") and Silicon Valley Bank
("Bank").

In connection with, among other documents, the Loan and Security Agreement (the
"Loan Documents") being concurrently executed herewith between Borrower and
Bank, Borrower agrees as follows:

         1.       Borrower shall not without the Bank's prior written consent,
                  other than a transfer of non-exclusive licenses and exclusive
                  licenses limited to geographical territories outside of the
                  United States or specific fields of use in the ordinary course
                  of business and other than Permitted Liens, sell, transfer,
                  assign, mortgage, pledge, lease, grant a security interest in,
                  or encumber any of Borrower's intellectual property,
                  including, without limitation, the following:

                  (a)      Any and all copyright rights, copyright applications,
                           copyright registrations and like protections in each
                           work or authorship and derivative work thereof,
                           whether published or unpublished and whether or not
                           the same also constitutes a trade secret, now or
                           hereafter existing, created, acquired or held;

                  (b)      All mask works or similar rights available for the
                           protection of semiconductor chips, now owned or
                           hereafter acquired;

                  (c)      Any and all trade secrets, and any and all
                           intellectual property rights in computer software and
                           computer software products now or hereafter existing,
                           created, acquired or held;

                  (d)      Any and all design rights which may be available to
                           Borrower now or hereafter existing, created, acquired
                           or held;

                  (e)      All patents, patent applications and like protections
                           including, without limitation, improvements,
                           divisions, continuations, renewals, reissues,
                           extensions and continuations-in-part of the same,
                           including without limitation the patents and patent
                           applications;

                  (f)      Any trademark and servicemark rights, whether
                           registered or not, applications to register and
                           registrations of the same and like protections, and
                           the entire goodwill of the business of Borrower
                           connected with and symbolized by such trademarks,
                           including without limitation;

                  (g)      Any and all claims for damages by way of past,
                           present and future infringements of any of the rights
                           included above, with the right, but not the
                           obligation, to sue for and collect such damages for
                           said use or infringement of the intellectual property
                           rights identified above;

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                  (h)      All licenses or other rights to use any of the
                           Copyrights, Patents, Trademarks or Mask Works, and
                           all license fees and royalties arising from such use
                           to the extent permitted by such license or rights;
                           and

                  (i)      All amendments, extensions, renewals and extensions
                           of any of the Copyrights, Trademarks, Patents, or
                           Mask Works; and

                  (j)      All proceeds and products of the foregoing, including
                           without limitation all payments under insurance or
                           any indemnity or warranty payable in respect of any
                           of the foregoing;

         2.       It shall be an event of default under the Loan Documents
                  between Borrower and Bank if there is a breach of any term of
                  this Negative Pledge Agreement.

         3.       Capitalized terms used but not otherwise defined herein shall
                  have the same meaning as in the Loan Documents.

                                          BORROWER:

                                          NOVACEPT

                                          By: /s/ Edward W. Unkart
                                             -------------------------------

                                          Name: Edward W. Unkart

                                          Title: VP

                                          BANK:

                                          SILICON VALLEY BANK

                                          By: /s/ Mercy Forde
                                             -------------------------------

                                          Name: Mercy Forde

                                          Title: Vice President

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