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                                                                   EXHIBIT 10.18


                                    EXHIBIT B
                          REGISTRATION RIGHTS AGREEMENT


         REGISTRATION RIGHTS AGREEMENT (this  "Agreement"),  dated as of

-----------------  , 1998,  by and among Planet  Polymer  Technologies,  Inc., a
California corporation,  with headquarters located at 9985 Business Park Avenue,
Suite A, San Diego, California 92131 (the "Company"),  and the undersigned buyer
("Buyer").

         WHEREAS:

         A. In  connection  with  the  Stock  Purchase  Agreement  of even  date
herewith  entered  into  between the Company and the Buyer (the "Stock  Purchase
Agreement"),  the  Company  has  agreed,  upon  the  terms  and  subject  to the
conditions of the Stock  Purchase  Agreement to issue and sell to the Buyers (i)
shares (the "Shares") of the Company's  common stock,  no par value (the "Common
Stock"), and (ii) warrants (the "Warrants"), which are exercisable for shares of
the Company's  common  stock,  no par value (such shares issued upon exercise of
the Warrants to be referred to herein as the "Warrant Shares"); and

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

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

         1.       DEFINITIONS

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

                  a. "business day"  means  any  day  on  which  banks  are  not
         required or authorized to close in New York City, New York.

                  b.  "Investor"  means Buyer and any  permitted  transferee  or
         assignee  thereof  to whom the Buyer  assigns  this  Agreement  and who
         agrees  to  become  bound  by  the  provisions  of  this  Agreement  in
         accordance with Section 9 hereof.

                  c. "Register,"  "registered,"  and  "registration"  refer to a
         registration effected by preparing and filing a Registration  Statement
         or Statements in compliance  with the 1933 Act and pursuant to Rule 415
         under  the  1933  Act or any  successor  rule  providing  for  offering
         securities on a continuous  basis ("Rule 415"),  and the declaration or
         ordering





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         of  effectiveness of such  Registration  Statement by the United States
         Securities and Exchange Commission (the "SEC").

                  d.  "Registrable  Securities" means the Shares and the Warrant
         Shares and any shares of Common  Stock  issued in respect of the Shares
         or  Warrant  Shares  as a result of any stock  split,  stock  dividend,
         recapitalization  or similar event,  including  without  limitation the
         issuance of shares of common stock in satisfaction of the undersigned's
         rights  of  first  refusal  under  Section  5  of  the  Stock  Purchase
         Agreement.

                  e. "Registration Statement" or "Registration Statements" means
         a  registration  statement or statements of the Company filed under the
         1933 Act.

         Capitalized  terms used herein and not otherwise  defined  herein shall
         have the respective meanings set forth in the Stock Purchase Agreement.

         2.       REGISTRATION.

                  a.  MANDATORY  REGISTRATION.  The  Company  shall use its best
         efforts  to  prepare,  and,  on or before  April 1, 1999  (such date of
         filing,  the "Initial  Filing Date"),  file with the SEC a Registration
         Statement or Registration Statements (as is necessary) on Form S-3 (or,
         if such form is unavailable for such a registration, on such other form
         as is available  for such a  registration),  covering the resale of the
         amount of Registrable  Securities  identified below, which Registration
         Statement(s),  to the extent allowable under the 1933 Act and the rules
         promulgated  thereunder  (including  Rule 416),  shall  state that such
         Registration  Statement(s)  also  covers such  indeterminate  number of
         additional  shares  of Common  Stock as may  become  issuable  (i) upon
         conversion  of the  Shares  or  exercise  of the  Warrants  to  prevent
         dilution  resulting  from  stock  splits,  stock  dividends  or similar
         transactions,  (ii) by reason of changes in the  exercise  price of the
         Warrants in accordance  with the terms thereof,  and (iii) by reason of
         the  exercise  by Buyer of its right of first  refusal  as set forth in
         Section  5 of the Stock  Purchase  Agreement.  The  number of shares of
         Common Stock initially included in such Registration Statement(s) shall
         be no less than 3,000,000 shares of Common Stock that are issuable upon
         the Initial Filing Date and the exercise of Warrants in accordance with
         their  terms.  The  Company  shall  use its best  efforts  to have such
         Registration  Statement(s)  declared effective by the SEC within ninety
         (90) days after the filing of the Registration  Statement.  The Company
         further  undertakes  to take  all  steps  necessary  to  ensure  that a
         Registration  Statement is or  Registration  Statements  are  effective
         during the  Registration  Period (as defined below) with respect to all
         Registrable  Securities  and the resale thereof at all times during the
         Registration Period. Any Registration  Statement(s) referred to in this
         Section  2(a) (and  each  amendment  or  supplement  thereto,  and each
         request for acceleration of effectiveness thereof) shall be provided to
         and  approved  by Buyer and its legal  counsel  prior to the  Company's
         filing  or  other  submission  (such  approval  not to be  unreasonably
         withheld)





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         and the  Company  will not file any  document  in a form to which  such
         counsel reasonably objects.

                  b.  PIGGY-BACK  REGISTRATIONS.  If at any  time  prior  to the
         expiration  of the  Registration  Period (as  hereinafter  defined) the
         Company  determines  to  file  with  the SEC a  Registration  Statement
         relating  to an  offering  for its own account or the account of others
         under the 1933 Act of any of its Common  Stock  (other than on Form S-4
         or Form S-8 or their then-equivalents  relating to equity securities to
         be issued solely in connection  with any  acquisition  of any entity or
         business or equity  securities  issuable in  connection  with  employee
         stock option or other employee  benefit plans),  the Company shall send
         to each Investor who is entitled to  registration  rights under Section
         2(a) written notice of such  determination.  If within twenty (20) days
         after  receipt  of such  notice,  such  Investor  shall so  request  in
         writing,  the Company shall include in such Registration  Statement all
         or any part of the Registrable  Securities such Investor requests to be
         registered,  except that if, in connection with any underwritten public
         offering  for the account of the Company,  the managing  underwriter(s)
         thereof  shall  impose a  limitation  on the number of shares of Common
         Stock which may be included in the Registration  Statement because,  in
         such underwriter(s)' reasonable good faith judgment, marketing or other
         factors  dictate such  limitation  is necessary  to  facilitate  public
         distribution,  then the Company  shall be  obligated to include in such
         Registration  Statement  only such limited  portion of the  Registrable
         Securities with respect to which such Investor has requested  inclusion
         hereunder  as  may  be  determined  by  such  managing  underwriter(s);
         provided  that no  portion  of the Common  Stock  which the  Company is
         offering for its own account shall be excluded;  provided, further that
         the Company shall be entitled to exclude Registrable  Securities to the
         extent necessary to avoid breaching  obligations  existing prior to the
         date hereof to other  stockholders  of the  Company.  Any  exclusion of
         Registrable  Securities  shall  be made pro rata  among  the  Investors
         seeking to include Registrable Securities,  in proportion to the number
         of  Registrable  Securities  sought to be included  by such  Investors;
         provided,  however,  that the Company shall not exclude any Registrable
         Securities  unless  the  Company  has first  excluded  all  outstanding
         securities, the holders of which are not entitled to pro rata inclusion
         of such securities in such  Registration  Statement or are not entitled
         to pro rata inclusion  with the  Registrable  Securities;  and provided
         further,   however,  that,  after  giving  effect  to  the  immediately
         preceding  proviso,  any exclusion of Registrable  Securities  shall be
         made pro rata with  holders  of other  securities  having  the right to
         include  such  securities  in the  Registration  Statement  other  than
         holders of securities entitled to inclusion of their securities in such
         Registration  Statement  by reason of  demand or  similar  registration
         rights or whose  registration  rights existed prior to the date hereof.
         No right to registration of Registrable  Securities  under this Section
         2(b)  shall be  construed  to limit  any  registration  required  under
         Section 2(a) hereof.

                  c.  ELIGIBILITY  FOR FORM  S-3.  The  Company  represents  and
         warrants  that it meets  the  requirements  for the use of Form S-3 for
         registration of the sale by the Buyers





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         and any other  Investor of the  Registrable  Securities and the Company
         shall use its best efforts to file all reports  required to be filed by
         the  Company  with the SEC in a timely  manner so as to  maintain  such
         eligibility  for the use of Form S-3. In the event that Form S-3 is not
         available for sale by the Investors of the Registrable Securities,  the
         Company shall register the sale on another appropriate form.

3.       RELATED OBLIGATIONS.

                  a. The  Company  shall  use its  best  efforts  to  cause  the
         Registration  Statement(s) relating to Registrable  Securities referred
         to in Section 2(a) to become  effective as soon as possible  after such
         filing,  and keep the Registration  Statement(s)  effective pursuant to
         Rule 415 at all times until the earlier of (i) the date as of which the
         Investors  may  sell  all  of  the   Registrable   Securities   without
         restriction  pursuant to Rule 144(k) promulgated under the 1933 Act (or
         successor  thereto),  or (ii) the date on which (A) the Investors shall
         have sold all the  Registrable  Securities and (B) none of the Warrants
         is  outstanding  (the   "Registration   Period"),   which  Registration
         Statement(s)  (including  any  amendments  or  supplements  thereto and
         prospectuses  contained therein) shall not contain any untrue statement
         of a material  fact or omit to state a  material  fact  required  to be
         stated therein,  or necessary to make the statements  therein, in light
         of the circumstances in which they were made, not misleading.

                  b. In the event that the Registration Statement referred to in
         Section 2(a) has not been declared  effective by the 90th day following
         the Initial Filing Date for failure by the Company to exercise its best
         efforts in  pursuing  such  registration,  for each  successive  30 day
         period  thereafter  and until such  Registration  Statement is declared
         effective,  the  Company  agrees to pay to each  Buyer,  as  liquidated
         damages and not as a penalty,  an amount equal to three percent (3%) of
         the aggregate  original  purchase price of the Shares purchased by such
         Buyer,  payable  in cash  commencing  on the  120th day  following  the
         Initial  Filing Date and on every 30th day  thereafter  (or sooner,  as
         provided  in the next  sentence)  (any such  payment  referred to as an
         "Additional Payment").  On the date that such Registration Statement is
         declared effective,  the Company shall pay to each Buyer all Additional
         Payments due to such Buyer,  in cash,  pro rata according to the number
         of days since the last Additional Payment (or, if no Additional Payment
         has been paid, since the 90th day following the Initial Closing Date).

                  c.  The  Company  shall  prepare  and  file  with the SEC such
         amendments (including post-effective amendments) and supplements to the
         Registration  Statement(s)  referred to in Section 2(a) and the related
         prospectus(es)  used in connection with such Registration  Statement(s)
         as may be necessary to keep the Registration  Statement(s) effective at
         all times during the Registration  Period, and, during such period, and
         the Company and the Investors  shall comply with the  provisions of the
         1933 Act with respect to the disposition of all Registrable  Securities
         of the Company  covered by such  Registration  Statement(s)  until such
         time as all such Registrable Securities shall have





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         been disposed of in accordance with the intended methods of disposition
         by the  seller or  sellers  thereof  as set forth in such  Registration
         Statement(s).

                  d.  The  Company  shall   furnish  to  each   Investor   whose
         Registrable  Securities are included in the  Registration  Statement(s)
         referred to in Sections  2(a) and 2(b) (i)  promptly  after the same as
         prepared and publicly  distributed,  filed with the SEC, or received by
         the Company, one copy of such Registration  Statement and any amendment
         thereto,  and (ii) such number of copies of a  prospectus,  including a
         preliminary prospectus,  and all amendments and supplements thereto and
         such other  documents as such Investor may reasonably  request in order
         to facilitate the  disposition of the Registrable  Securities  owned by
         such Investor pursuant to such Registration Statement(s).

                  e. The Company  shall use its best efforts to (i) register and
         qualify  the  Registrable   Securities   covered  by  the  Registration
         Statement(s) referred to in Section 2(a) under such other securities or
         "blue  sky"  laws of such  jurisdictions  in the  United  States as the
         Investors  who hold a  majority  of the  Registrable  Securities  being
         offered in connection  therewith  reasonably request,  (ii) prepare and
         file in those jurisdictions such amendments  (including  post-effective
         amendments) and supplements to such registrations and qualifications as
         may be  necessary  to maintain  the  effectiveness  thereof  during the
         Registration  Period, (iii) take such other actions as may be necessary
         to maintain  such  registrations  and  qualifications  in effect at all
         times during the Registration  Period,  and (iv) take all other actions
         reasonably necessary or advisable to qualify the Registrable Securities
         for sale in such  jurisdictions;  provided,  however,  that the Company
         shall not be required in connection therewith or as a condition thereto
         to (a) qualify to do business  in any  jurisdiction  where it would not
         otherwise be required to qualify but for this Section 3(e), (b) subject
         itself to general taxation in any such jurisdiction, (c) file a general
         consent to service of process in any such jurisdiction, or (d) make any
         change  in its  charter  or  bylaws,  which in each  case the  Board of
         Directors  of  the  Company  determines  to be  contrary  to  the  best
         interests  of the  Company  and its  stockholders.  The  Company  shall
         promptly notify each Investor who holds  Registrable  Securities of the
         receipt  by  the  Company  of  any  notification  with  respect  to the
         suspension  of  such  registration  or  qualification  of  any  of  the
         Registrable Securities for sale under the securities or "blue sky" laws
         of any  jurisdiction  in the  United  States or its  receipt  of actual
         notice of the  initiation or  threatening  of any  proceeding  for such
         purpose.

                  f. As promptly as  practicable  after  becoming  aware of such
         event,  the Company  shall notify each Investor of the happening of any
         event,  of which the  Company has  knowledge,  as a result of which the
         prospectus  included in a  Registration  Statement,  as then in effect,
         includes  an  untrue  statement  of  material  fact or omits to state a
         material  fact  required to be stated  therein or necessary to make the
         statements therein, in light of the circumstances under which they were
         made, not misleading,  and use its best efforts promptly to prepare and
         file a supplement or amendment to the Registration Statement to correct
         such untrue statement or omission, and deliver at least one copy and





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         such number of  additional  copies of such  supplement  or amendment to
         each  Investor as such  Investor may  reasonably  request.  The Company
         shall  also,  within five (5) days after its  release,  provide to each
         Investor (other than Buyer and its affiliates,  whose rights to receive
         financial and related information  concerning the Company are set forth
         in the Stock  Purchase  Agreement  and Warrant) a copy of the Company's
         Annual Report and Form 10-KSB and quarterly  report on Form 10-QSB,  as
         filed with the SEC.

                  g. The  Company  shall use its best  efforts  to  prevent  the
         issuance of any stop order or other  suspension of  effectiveness  of a
         Registration Statement,  and, if such an order is issued, to obtain the
         withdrawal of such order at the earliest  possible moment and to notify
         each Investor who holds Registrable  Securities being sold (and, in the
         event of an underwritten  offering,  the managing  underwriters) of the
         issuance  of such order and the  resolution  thereof or its  receipt of
         actual notice of the  initiation or threat of any  proceeding  for such
         purpose.

                  h. The Company  shall  furnish,  on the date that  Registrable
         Securities  are  delivered  to an  underwriter,  if  any,  for  sale in
         connection with a Registration Statement referred to in Section 2(b) if
         and only if required by an underwriter, a letter, dated such date, from
         the Company's  independent  certified  public  accountants  in form and
         substance  as is  customarily  given by  independent  certified  public
         accountants  to  underwriters   in  an  underwritten   public  offering
         ("Accountant's Comfort Letter"), addressed to the underwriters, and the
         Investors,  and (ii) an  opinion,  dated as of such  date,  of  counsel
         representing the Company for purposes of such  Registration  Statement,
         in form, scope and substance as is customarily given in an underwritten
         public offering,  addressed to the underwriters and the Investors.  If,
         in  the  opinion  of  counsel  to any  Investor,  such  Investor  could
         reasonably be deemed to be an underwriter  (as defined in the 1933 Act)
         in  connection  with its resale of the  securities  under  Section 2(a)
         hereof,  such  Investor  may require  that the  Company  deliver to the
         Investor an  Accountant's  Comfort  Letter  addressed to such Investor;
         provided,  however,  that  any  request  by an  Investor  for  such  an
         Accountant's  Comfort  Letter may be made not more than once during any
         given six month period, and the Company shall not be required to expend
         in excess of $10,000 in accountant  fees in respect of any such comfort
         letter.

                  i.  To  the  extent  reasonably   required  to  satisfy  their
         obligations, if any, as sellers of Common Stock, the Company shall make
         available  for  inspection  by (i) any  Investor,  and (ii) one firm of
         attorneys and one firm of accountants  or other agents  retained by the
         Investors (collectively,  the "Inspectors") all pertinent financial and
         other records,  and pertinent corporate documents and properties of the
         Company  (collectively,  the "Records"),  as shall be reasonably deemed
         necessary by each  Inspector  to enable each  Inspector to exercise its
         due diligence responsibility, if any, and cause the Company's officers,
         directors  and  employees  to  supply  all such  information  which any
         Inspector  may  reasonably  request;   provided,   however,  that  each
         Inspector  shall  hold in  strict  confidence  and  shall  not make any
         disclosure (except to an Investor) or use of any Record or other





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         information   which  the  Company   determines  in  good  faith  to  be
         confidential,   and  of  which  determination  the  Inspectors  are  so
         notified,  unless (a) the  disclosure  of such  Records is necessary to
         avoid  or  correct  a  misstatement  or  omission  in any  Registration
         Statement,  (b) the  release  of such  Records  is, in the  opinion  of
         counsel  of  recognized   status,   required  by  law,   regulation  or
         administrative  authority  or such  release  is ordered  pursuant  to a
         final, non-appealable subpoena or order from a court or government body
         of competent  jurisdiction,  or (c) the information in such Records has
         been made generally available to the public other than by disclosure in
         violation  of this or any other  agreement.  The  Company  shall not be
         required to disclose any  confidential  information  in such Records to
         any Inspector  until and unless such Inspector  shall have entered into
         confidentiality  agreements (in form and substance  satisfactory to the
         Company) with the Company with respect  thereto,  substantially in form
         and substance reasonably requested by the Company. Each Investor agrees
         that it shall,  upon learning that disclosure of such Records is sought
         in or by a court or  governmental  body of  competent  jurisdiction  or
         through  other means,  give prompt  notice to the Company and allow the
         Company,  at its expense,  to undertake  appropriate  action to prevent
         disclosure of, or to obtain a protective  order for, the Records deemed
         confidential.  Nothing  herein shall be deemed to limit the  Investor's
         ability to sell  Registrable  Securities in a manner which is otherwise
         consistent with applicable laws and regulations.

                  j.  The  Company  shall  hold in  confidence  and not make any
         disclosure  of  information  concerning  an  Investor  provided  to the
         Company  unless (i)  disclosure  of such  information  is  necessary to
         comply with federal or state  securities  laws,  (ii) the disclosure of
         such  information  is necessary to avoid or correct a  misstatement  or
         omission  in any  Registration  Statement,  (iii) the  release  of such
         information  is  ordered   pursuant  to  a  subpoena  or  other  final,
         non-appealable  order from a court or  governmental  body of  competent
         jurisdiction,   or  (iv)  such  information  has  been  made  generally
         available to the public other than by  disclosure  in violation of this
         or any other agreement. The Company agrees that it shall, upon learning
         that disclosure of such information concerning an Investor is sought in
         or by a court or governmental body of competent jurisdiction or through
         other  means,  give  prompt  notice to such  Investor  and  allow  such
         Investor, at the Investor"s expense, to undertake appropriate action to
         prevent  disclosure  of,  or to obtain a  protective  order  for,  such
         information.

                  k. The Company shall use its best efforts  either to (i) cause
         all the Registrable  Securities covered by a Registration  Statement to
         be listed on each national  securities  exchange on which securities of
         the same class or series issued by the Company are then listed, if any,
         if the listing of such  Registrable  Securities is then permitted under
         the rules of such exchange, or (ii) secure designation and quotation of
         all the Registrable Securities covered by the Registration Statement on
         the Nasdaq SmallCap Market system and,  without limiting the generality
         of the foregoing, to arrange for at least two market makers to register
         with the National  Association of Securities Dealers,  Inc. ("NASD") as
         such with respect to such Registrable Securities.





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                  l. The Company  shall  cooperate  with the  Investors who hold
         Registrable   Securities   being  offered  to  facilitate   the  timely
         preparation and delivery of  certificates  (not bearing any restrictive
         legend)  representing  the  Registrable  Securities  sold pursuant to a
         Registration  Statement  and  enable  such  certificates  to be in such
         denominations  or  amounts,  as  the  case  may  be,  as  the  managing
         underwriter  or  underwriters,  if any,  or,  if there  is no  managing
         underwriter or underwriters,  the Investors may reasonably  request and
         registered in such names as the managing  underwriter or  underwriters,
         if any, or the Investors may request.  Not later than the date on which
         any  Registration  Statement  registering  the  resale  of  Registrable
         Securities  is declared  effective,  the Company  shall  deliver to its
         transfer agent  instructions  authorizing the removal of any legends on
         the  Registrable  Securities  upon the sale  thereof  pursuant  to such
         Registration Statement,  accompanied by any reasonably required opinion
         of counsel,  to permit sales thereof in a timely  fashion that complies
         with applicable securities laws and then mandated securities settlement
         procedures for regular way market transactions.

                  m.  The  Company  shall  take  all  other  reasonable  actions
         necessary to expedite and  facilitate  disposition  by the Investors of
         Registrable Securities pursuant to a Registration Statement.

                  n. The Company and the Investors  shall otherwise use its best
         efforts to comply with all applicable  rules and regulations of the SEC
         in connection with any registration hereunder.

         4.       OTHER OBLIGATIONS.

                  a.  At  least  five  (5)  business  days  prior  to the  first
         anticipated  filing date of the Registration  Statement  referred to in
         Section 2, the Company  shall notify each  Investor of the  information
         the Company requires from each such Investor if such Investor elects to
         have any of such  Investor's  Registrable  Securities  included  in the
         Registration  Statement.  It  shall  be a  condition  precedent  to the
         obligations  of the Company to complete  any  registration  pursuant to
         this  Agreement  with  respect  to  the  Registrable  Securities  of  a
         particular  Investor  that such  Investor  shall furnish to the Company
         such information  regarding itself, the Registrable  Securities held by
         it and the intended method of disposition of the Registrable Securities
         held by it as shall be reasonably  required to effect the  registration
         of such  Registrable  Securities  and shall  execute such  documents in
         connection  with  such  registration  as  the  Company  may  reasonably
         request.

                  b.  Each  Investor  by  such  Investor's   acceptance  of  the
         Registrable   Securities  agrees  to  cooperate  with  the  Company  as
         reasonably  requested by the Company in connection with the preparation
         and filing of the  Registration  Statement(s)  hereunder,  unless  such
         Investor  has  notified  the  Company  in  writing  of such  Investor's
         election to exclude all of such Investor's Registerable Securities from
         the Registration Statement.





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                  c. Each Investor  agrees that, upon receipt of any notice from
         the  Company or the  happening  of any event of the kind  described  in
         Section 3(f), such Investor will immediately discontinue disposition of
         Registrable   Securities   pursuant  to  the  applicable   Registration
         Statement(s) covering such Registrable Securities until such Investor's
         receipt  of  copies  of  the   supplemented   or   amended   prospectus
         contemplated by Section 3(f), and, if so directed by the Company,  such
         Investor  shall  deliver to the Company (at the expense of the Company)
         or destroy (and deliver to the Company a  certificate  of  destruction)
         all copies in such Investor's  possession,  of the prospectus  covering
         such  Registrable  Securities  current  at the time of  receipt of such
         notice.

                  d.  No   Investor   may   participate   in  any   underwritten
         registration  hereunder  unless such  Investor  (i) agrees to sell such
         Investor's   Registrable  Securities  on  the  basis  provided  in  any
         underwriting  arrangements  established by the Company,  (ii) completes
         and  executes  all  questionnaires,  powers of  attorney,  indemnities,
         underwriting  agreements and other documents  reasonably required under
         the terms of such  underwriting  arrangements,  and (iii) agrees to pay
         its pro rata share of all underwriting discounts and commissions.

         5.       EXPENSES OF REGISTRATION.

         All  reasonable  expenses,   other  than  underwriting   discounts  and
commissions  and fees and  disbursements  of  Investors'  counsel,  accountants,
investment  bankers or other  advisors or agents,  incurred in  connection  with
registrations,   filings  or  qualifications  pursuant  to  Sections  2  and  3,
including,  without  limitation,  all registration,  listing and  qualifications
fees,  printers and accounting  fees, and fees and  disbursements of counsel for
the Company shall be borne by the Company.

         6.       INDEMNIFICATION.

         In the event any Registrable  Securities are included in a Registration
Statement under this Agreement:

                  a. To the extent permitted by law, the Company will indemnify,
         hold  harmless  and defend  each  Investor  who holds such  Registrable
         Securities, the partners, directors, officers, employees and agents of,
         and each person who  controls,  any Investor  within the meaning of the
         1933 Act or the Securities  Exchange Act of 1934, as amended (the "1934
         Act"), if any, and any underwriter (as defined in the 1933 Act) for the
         Investors, and the partners, directors,  officers, employees and agents
         of, and each person, if any, who controls,  any such underwriter within
         the  meaning  of the 1933 Act or the 1934 Act  (each,  an  "Indemnified
         Person"), against any losses, claims, damages, liabilities,  attorneys'
         fees  and   expenses,   amounts   paid  in   settlement   or   expenses
         (collectively,  "Claims")  to  which  any of them  may  become  subject
         insofar as such Claims (or actions or proceedings  in respect  thereof,
         whether or not commenced or threatened by





                                       9
<PAGE>   10

         or before the date the Registration Statement is declared effective and
         whether or not an Indemnified  Person is party thereto) arise out of or
         are based upon: (i) any untrue statement or alleged untrue statement of
         a material  fact in a  Registration  Statement or in any filing made in
         connection with the  qualification of the offering under the securities
         or other  "blue  sky"  laws of any  jurisdiction  in which  Registrable
         Securities are offered ("Blue Sky Filing"),  or the omission or alleged
         omission  to state a material  fact  therein  required  to be stated or
         necessary to make the statements therein, in light of the circumstances
         in which such  statements  were made, not  misleading,  (ii) any untrue
         statement or alleged  untrue  statement of a material fact contained in
         any preliminary  prospectus if used prior to the effective date of such
         Registration  Statement,  or  contained  in the  final  prospectus  (as
         amended or supplemented,  if the Company files any amendment thereof or
         supplement thereto with the SEC) or the omission or alleged omission to
         state therein any material fact necessary to make the  statements  made
         therein,  in light of the  circumstances  under  which  the  statements
         therein were made,  not  misleading,  or (iii) any violation or alleged
         violation  by the Company of the 1933 Act, the 1934 Act, any other law,
         including, without limitation, any state securities law, or any rule or
         regulation  thereunder relating to the offer or sale of the Registrable
         Securities  pursuant to a  Registration  Statement  (the matters in the
         foregoing clauses (i) through (iii) being, collectively, "Violations").
         Subject to the  restrictions  set forth in Section 6(d) with respect to
         the  number  of  legal  counsel,   the  Company  shall   reimburse  the
         Indemnified  Persons promptly as such expenses are incurred and are due
         and payable,  for any legal fees or other reasonable  expenses incurred
         by them in connection with  investigating  or defending any such Claim.
         Notwithstanding   anything  to  the  contrary   contained  herein,  the
         indemnification agreement contained in this Section 6(a): (i) shall not
         apply to a Claim arising out of or based upon a Violation  which occurs
         in  reliance  upon and in  conformity  with  information  furnished  in
         writing to the Company by any Indemnified  Person  expressly for use in
         connection  with the  preparation of the  Registration  Statement,  any
         related prospectus or any such amendment thereof or supplement thereto,
         if such Registration  Statement or prospectus was timely made available
         by the Company  pursuant to Section 3(d)  hereof;  (ii) with respect to
         any preliminary prospectus,  shall not inure to the benefit of any such
         person  from whom the person  asserting  any such Claim  purchased  the
         Registrable  Securities that are the subject thereof (or to the benefit
         of any person  controlling  such  person) if the  untrue  statement  or
         omission of material fact contained in the  preliminary  prospectus was
         corrected  on a timely  basis in the  prospectus,  as then  amended  or
         supplemented,  if such  prospectus  was timely  made  available  by the
         Company  pursuant to Section 3(d) hereof;  (iii) shall not be available
         to the  extent  such  Claim is based on a failure  of the  Investor  to
         deliver or cause to be delivered a preliminary or final prospectus made
         available on a timely basis by the Company; and (iv) shall not apply to
         amounts paid in settlement of any Claim if such  settlement is effected
         without prior written  consent of the Company,  which consent shall not
         be  unreasonably  withheld or delayed.  Such indemnity  shall remain in
         full force and effect  regardless  of any  investigation  made by or on
         behalf of the Indemnified  Person and shall survive the transfer of the
         Registrable Securities by the Investors pursuant to Section 9.





                                       10
<PAGE>   11

                  b. In connection with any  Registration  Statement in which an
         Investor is participating, each such Investor agrees to indemnify, hold
         harmless  and  defend,  to the same extent and in the same manner as is
         set forth in Section 6(a), the Company, each of its directors,  each of
         its officers who signs the Registration Statement, each person, if any,
         who controls the Company within the meaning of the 1933 Act or the 1934
         Act,  any  underwriter  and any other  stockholder  selling  securities
         pursuant  to the  Registration  Statement  or any of its  directors  or
         officers or any person who controls  such  stockholder  or  underwriter
         within the  meaning of the 1933 Act or the 1934 Act  (collectively  and
         together with an Indemnified Person, an "Indemnified  Party"),  against
         any Claim to which any of them may become subject,  under the 1933 Act,
         the 1934 Act or  otherwise,  insofar as such Claims arise out of or are
         based upon any  Violation,  in each case to the extent (and only to the
         extent) that such  violation  occurs in reliance upon and in conformity
         with  written  information  furnished  to the Company by such  Investor
         expressly for use in connection with such Registration  Statement;  and
         such Investor will  reimburse  any legal or other  expenses  reasonably
         incurred by them in connection with investigating or defending any such
         Claim;  provided,  however,  that the indemnity  agreement contained in
         this Section 6(b) shall not apply to amounts paid in  settlement of any
         Claim if such settlement is effected  without the prior written consent
         of such  Investor,  which consent shall not be  unreasonably  withheld;
         provided,  further,  however,  that the Investor  shall be liable under
         this Section 6(b) for only that amount of Claims as does not exceed the
         net  proceeds to such  Investor as a result of the sale of  Registrable
         Securities  pursuant to such  Registration  Statement.  Such  indemnity
         shall remain in full force and effect  regardless of any  investigation
         made by or on behalf of such  Indemnified  Party and shall  survive the
         transfer of the  Registrable  Securities by the  Investors  pursuant to
         Section 9.  Notwithstanding  anything to the contrary contained herein,
         the  indemnification  agreement  contained  in this  Section  6(b) with
         respect to any preliminary prospectus shall not inure to the benefit of
         any Indemnified  Party if the untrue  statement or omission of material
         fact contained in the preliminary  prospectus was corrected on a timely
         basis in the related final prospectus, as then amended or supplemented.

                  c.  Promptly  after  receipt  by  an  Indemnified   Person  or
         Indemnified Party under this Section 6 of notice of the commencement of
         any action (including any governmental action), such Indemnified Person
         or  Indemnified  Party  shall,  if a Claim in  respect  thereof is made
         against any  indemnifying  party under this  Section 6,  deliver to the
         indemnifying  party a written notice of the commencement  thereof,  and
         the  indemnifying  party shall have the right to assume  control of the
         defense thereof with counsel reasonably satisfactory to the Indemnified
         Person or the Indemnified Party, as the case may be; provided, however,
         that an Indemnified  Person or Indemnified  Party,  as the case may be,
         shall have the right to employ its own counsel in any such action,  but
         the fees,  expenses  and other  charges of such  counsel will be at the
         expense of such Indemnified  Person or Indemnified Party unless (1) the
         employment of counsel by the  Indemnified  Person or Indemnified  Party
         has been  authorized  in writing  by the  indemnifying  party,  (2) the
         Indemnified Person or Indemnified Party has reasonably concluded (based
         on advice





                                       11
<PAGE>   12

         of counsel)  that there may be legal  defenses  available  to it or any
         other Indemnified Person or Indemnified Parties that are different from
         or in addition to those  available  to the  indemnifying  party,  (3) a
         conflict or potential  conflict  exists  (based on advice of counsel to
         the  Indemnified  Person or Indemnified  Party) between the Indemnified
         Person or Indemnified  Party and the indemnifying  party (in which case
         the indemnifying party will not have the right to direct the defense of
         such action on behalf of the Indemnified  Person or Indemnified  Party)
         or (4) the  indemnifying  party  has not in fact  employed  counsel  to
         assume  the  defense  of such  action  within a  reasonable  time after
         receiving  notice of the  commencement of the action,  in each of which
         cases the reasonable fees,  disbursements  and other charges of counsel
         will be at the  expense of the  indemnifying  party or  parties.  It is
         understood  that  the  indemnifying  party or  parties  shall  not,  in
         connection  with any  proceeding  or  related  proceedings  in the same
         jurisdiction,  be liable for the  reasonable  fees,  disbursements  and
         other  charges of more than one separate  firm  admitted to practice in
         such  jurisdiction at any one time for all such Indemnified  Persons or
         Indemnified Party or parties.  An indemnifying party will not be liable
         for any settlement of any action or claim effected  without its written
         consent (which consent will not be unreasonably withheld).  The failure
         to deliver written notice to the indemnifying party within a reasonable
         time of the  commencement  of any such action  shall not  relieve  such
         indemnifying  party  of any  liability  to the  Indemnified  Person  or
         Indemnified  Party under this  Section 6, except to the extent that the
         indemnifying  party is prejudiced in its ability to defend such action.
         The  indemnification  required  by  this  Section  6  shall  be made by
         periodic  payments  of the  amount  thereof  during  the  course of the
         investigation or defense, as such Claims are incurred or bills therefor
         are received and are due and payable.

         7.       CONTRIBUTION.

         To  the  extent  any   indemnification  by  an  indemnifying  party  is
prohibited or limited by law, each indemnifying party agrees to make the maximum
contribution  with respect to any amounts for which it would otherwise be liable
under  Section 6 in such  proportions  as shall be  appropriate  to reflect  all
equitable  principles,   including  without  limitation  the  relative  benefits
received by the relevant parties;  provided,  however,  that (i) no contribution
shall be made under circumstances where the maker would not have been liable for
indemnification under the fault standards set forth in Section 6, (ii) no seller
of Registrable  Securities  guilty of fraudulent  misrepresentation  (within the
meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution from
the  Company  or any  seller of  Registrable  Securities  who was not  guilty of
fraudulent   misrepresentation,   and  (iii)   contribution  by  any  seller  of
Registrable  Securities shall be limited in amount to the net amount of proceeds
received by such seller from the sale of such Registrable Securities.









                                       12
<PAGE>   13

         8.       REPORTS UNDER THE 1934 ACT.

         With a view to making  available to the  Investors the benefits of Rule
144  promulgated  under the 1933 Act or any other  similar rule or regulation of
the SEC that may at any time  permit the  investors  to sell  securities  of the
Company to the public without  registration  ("Rule 144"), the Company agrees to
use its best efforts to:

                  a.       make and keep public information available as those
terms are used in paragraph (a) of Rule 144;

                  b. file with the SEC in a timely  manner all reports and other
         documents required of the Company under Section 13 or 15(d) of the 1934
         Act so long as the Company  remains  subject to such  requirements  (it
         being   understood  that  nothing  herein  shall  limit  the  Company's
         obligations under Section 4(c) of the Stock Purchase Agreement).

                  c.  furnish to each  Investor  so long as such  Investor  owns
         Registrable  Securities promptly upon request,  (i) a written statement
         by the Company that it has  complied  with the  reporting  requirements
         referred  to in  Section  8(b)  above,  (ii) a copy of the most  recent
         annual or  quarterly  report of the Company and such other  reports and
         documents so filed by the Company and (iii) such other  information  as
         may be  reasonably  requested  to  permit  the  investors  to sell such
         securities pursuant to Rule 144 without registration.

         9.       ASSIGNMENT OF REGISTRATION RIGHTS.

         The rights to have the Company register Registrable Securities pursuant
to this Agreement  shall be assignable by the Investors to any transferee of all
or any portion of Registrable  Securities if: (i) the Investor agrees in writing
with the  transferee or assignee to assign the related  rights and  obligations,
and a copy of such  agreement is  furnished  to the Company  within a reasonable
time after such assignment,  (ii) the Company is, within a reasonable time after
such transfer or  assignment,  furnished with written notice of (a) the name and
address of such  transferee or assignee,  and (b) the securities with respect to
which  such  registration  rights  are  being  transferred  or  assigned,  (iii)
immediately  following  such transfer or assignment  the further  disposition of
such  securities by the transferee or assignee is restricted  under the 1933 Act
and applicable  state  securities  laws,  (iv) at or before the time the Company
receives the written notice  contemplated  by clause (ii) of this sentence,  the
transferee or assignee  agrees in writing with the Company to be bound by all of
the  provisions  contained  herein and to reimburse the Company for any expenses
that may be incurred by the Company as a result of such  assignment and transfer
that would not otherwise have been incurred by the Company,  including any costs
associated with the amendment of any Registration  Statement or prospectus,  (v)
such  transfer   shall  have  been  made  in  accordance   with  the  applicable
requirements of the





                                       13
<PAGE>   14

Stock  Purchase  Agreement,  and (vi) such  transferee  shall be an  "accredited
investor" as that term defined in Rule 501 of Regulation D promulgated under the
1933 Act.

         10.      AMENDMENT OF REGISTRATION RIGHTS.

         Provisions of this Agreement may be amended and the observance  thereof
may  be  waived  (either  generally  or  in a  particular  instance  and  either
retroactively  or  prospectively),  only with the written consent of the Company
and Investors who hold two-thirds of the Registrable  Securities.  Any amendment
or waiver effected in accordance with this Section 10 shall be binding upon each
Investor and the Company.  Notwithstanding  the  foregoing:  (i) no amendment or
waiver of this  Agreement with respect to shares of Common Stock which have been
previously  sold under a Registration  Statement  contemplated by this Agreement
shall be effective with respect to the holder of such shares who participated in
such registration  unless consented to this writing by such holder;  and (ii) no
amendment or waiver which adversely affects any holder of Registrable Securities
in a manner which does not  adversely  affect the other  holders of  Registrable
Securities shall be effective with respect to such holder unless consented to in
writing by such holder.

         11.      MISCELLANEOUS.

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

                  b. Any  notices  required or  permitted  to be given under the
         terms of this Agreement  shall be sent by registered or certified mail,
         return  receipt  requested,  or delivered  personally or by courier and
         shall be effective  three days after being place in the mail if mailed,
         or upon  receipt,  if delivered  personally  or by courier or facsimile
         (with a copy by U.S.  mail),  in each case  properly  addressed  to the
         party to receive such notice.  The  addresses  for such  communications
         shall be:


                  If to the Company:

                           9985 Business Park Avenue
                           Suite A
                           San Diego, California 92131
                           Telephone:       619 549-5130
                           Facsimile:       619 549-5133
                           Attention:       Robert J. Petcavich





                                       14
<PAGE>   15

                  With Copy to:

                           Lance W. Bridges, Esq.
                           Cooley Godward, LLP
                           4365 Executive Drive
                           Suite 1100
                           San Diego, CA 92121-2128

                  If to the Buyer:

                           Agway Holdings Inc.
                           P.O. Box 4933
                           Syracuse, NY  13227-4933
                           Telephone:       315 449-6568
                           Facsimile:       315 449-7451
                           Attention:       Peter J. O'Neill, V.P.

                  With a copy to:  David M. Hayes, Esq., General Counsel

                  Each  party  shall  provide  notice to the other  party of any
change in address in the manner provided herein.

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

                  d. This  Agreement  shall be  governed by and  interpreted  in
         accordance with the laws of the State of New York without regard to the
         principles  of conflict of laws.  If any  provision  of this  Agreement
         shall be invalid or unenforceable in any jurisdiction,  such invalidity
         or unenforceability  shall not affect the validity or enforceability of
         the remainder of this Agreement in that jurisdiction or the validity or
         enforceability  of  any  provision  of  this  Agreement  in  any  other
         jurisdiction.

                  e. This Agreement and the Stock Purchase  Agreement  (together
         with the  Schedules  and Exhibits  thereto),  the Warrant and the other
         agreements  and  instruments   referenced  herein  contain  the  entire
         understanding of the parties with respect to the matters covered herein
         and therein and,  except as  specifically  set forth herein or therein,
         neither  the  Company  nor Buyer  makes any  representation,  warranty,
         covenant or undertaking  with respect to such matters.  No provision of
         this  Agreement may be waived or amended other than by an instrument in
         writing signed by the party to be charged with enforcement.






                                       15
<PAGE>   16

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

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

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

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




Dated:



AGWAY HOLDINGS INC.


By:  /s/
        -------------------------------------
        NAME:
        TITLE :



ACCEPTED AND AGREED:

PLANET POLYMER TECHNOLOGIES, INC.


By:  /s/
        -------------------------------------
        NAME:
        TITLE:


                                       16