Document:

EXHIBIT 10(h.1)

                           DUSA PHARMACEUTICALS, INC.

                                1996 OMNIBUS PLAN
                            (AS AMENDED MAY 1, 2003)

                               ARTICLE I - PURPOSE
                               -------------------

      This  Omnibus  Plan (the  "Plan") is  intended  to promote  the growth and
general  prosperity  of  DUSA  Pharmaceuticals,  Inc.  (the  "Company")  and its
shareholders  by  offering  incentives  to  its  key  directors,  employees  and
consultants of the Company who are primarily  responsible  for the growth of the
Company and to attract and retain qualified directors, employees and consultants
of the Company and thereby benefit its  shareholders  based on the growth of the
Company.

                            ARTICLE II - DEFINITIONS
                            ------------------------

      Unless the context indicates otherwise,  the following terms, when used in
this Plan, shall have the meanings set forth in this Section:

      (a)  "Award"   shall  mean  grants   under  this  Plan  that  provide  the
participants  with the  right to  purchase  Common  Stock or that are  valued by
reference to the Fair Market Value of the Common Stock.

      (b) "Board" shall mean the Board of Directors of the Company.

      (c) "Cause" shall mean deliberate, willful or gross misconduct.

      (d) A "Change of Control" shall be deemed to have taken place upon (i) the
acquisition  by a third  person,  including  a "group"  as  defined  in  Section
13(d)(3) of the  Securities  Exchange Act of 1934, as amended,  of shares of the
Company having 50% or more of the total number of votes that may be cast for the
election of Directors of the Company; (ii) shareholder approval of a transaction
for the  acquisition  of the  Company,  or  substantially  all of its  assets by
another entity or for a merger, reorganization,  consolidation or other business
combination  to which the Company is a part;  or (iii) the  election  during any
period of 24 months or less of 50% or more of the Directors of the Company where
such Directors  were not in office  immediately  prior to such period  provided,
however,  that no "Change of Control" shall be deemed to have taken place if the
Directors of the Company in office on the date of adoption of the Plan, or their
successors  in  office  nominated  by such  Directors,  affirmatively  approve a
resolution to such effect.

      (e)  "Code"  shall  mean the  Internal  Revenue  Code of 1986 as it may be
amended from time to time.

      (f) "Committee" shall mean,  collectively,  the Board, or any Committee of
two or more  Non-Employee  Directors,  that may be  designated  by the  Board to
administer the Plan.

      (g) "Common  Stock"  shall mean all  classes of stock,  without par value,
including  convertible  preferred,  stock purchase warrants and all common stock
equivalents.

      (h)  "Consultant"  shall  mean any  person  who (i) is  engaged to perform
services  for the  Company or its  Subsidiaries,  other than as an  Employee  or
Director, or (ii) has agreed to become a consultant within the meaning of clause
(i).

      (i) "Director" shall mean any member of the Board.

<PAGE>

      (j)  "Disability"  shall mean  inability to perform the services  required
hereunder due to mental or physical  disability which continues for either (i) a
total of 180 working  days during any 12- month  period or (ii) 150  consecutive
working days.

      (k) "Employee" shall mean (i) any full-time employee of the Company or its
Subsidiaries  (including  Directors  who are  otherwise  employed on a full-time
basis by the Company or its Subsidiaries),  or (ii) any person who has agreed to
become an employee within the meaning of clause (i).

      (l) "Exchange  Act" shall mean the  Securities  Exchange Act of 1934 as it
may be amended from time to time.

      (m) "Fair Market Value" of the Common Stock on a given date shall be based
upon,  the last sales price or, if  unavailable,  the average of the closing bid
and asked prices per share of the Common Stock on such date (or, if there was no
trading or  quotation in the Common  Stock on such date,  on the next  preceding
date on which there was trading or quotation).

      (n) "Grantee" shall mean a person granted an Award under the Plan.

      (o) "ISO"  shall mean an Option  granted  pursuant to the Plan to purchase
shares of the Common Stock and intended to qualify as an incentive  stock option
under Section 422 of the Code, as now or hereafter constituted.

      (p) "1933 Act" shall mean the Securities Act of 1933; as amended.

      (q) "Non-Employee  Director" shall mean a non-employee director as defined
in Exchange Act Rule 16b-3(b)(3)(i).

      (r) "NQSO" shall mean an Option  granted  pursuant to the Plan to purchase
shares of the Common Stock that is not an ISO.

      (s) "Options" shall refer  collectively to NQSOs and ISOs issued under and
subject to the Plan.  Each option is exercisable  into one share of Common Stock
of the Company.

      (t) "Parent"  shall mean any parent  corporation as defined in Section 424
of the Code.

      (u)  "Performance  Awards"  shall mean grants  under the Plan,  payable in
cash,  Common  Stock,  other  securities or other awards and shall confer on the
holder  there of the right to receive  payments,  upon the  achievement  of such
performance  goals  during  such  performance  periods  as the  Committee  shall
establish.

      (v) "Restricted  Stock" shall mean Common Stock subject to restrictions on
transfer  and/or  such other  restrictions  on  incidents  of  ownership  as the
Committee may determine.

      (w) "SAR" shall mean a right to receive,  upon surrender of the right, but
without payment, an amount payable in cash.

      (x) "Subsidiary"  shall mean (i) any corporation with respect to which the
Company owns,  directly or indirectly,  50% or more of the total combined voting
power of all  classes of stock of such  Company,  or (ii) any  entity  which the
Committee reasonably expects to become a subsidiary within the meaning of clause
(i).

                                       2
<PAGE>

                          ARTICLE III - ADMINISTRATION
                          ----------------------------

      The Plan shall be administered by the Committee. Subject to the provisions
of the Plan, the Committee  shall have full  discretion and the exclusive  power
(i) to select the Employees,  Consultants and Directors who will  participate in
the Plan and to make Awards to such Employees,  Consultants, and Directors, (ii)
to  determine  the time at which such Awards  shall be granted and any terms and
conditions  with  respect to such Awards as shall not be  inconsistent  with the
provisions  of the Plan,  and (iii) to resolve  all  questions  relating  to the
administration  of  the  Plan.  The  interpretation  of and  application  by the
Committee  of any  provision  of the Plan  shall be final  and  conclusive.  The
Committee may in its discretion  establish such rules and guidelines relating to
the Plan as it may deem  desirable.  No member of the Board of  Directors or the
Committee  shall be liable  for any action or  determination  made in good faith
with respect to the Plan or any Awards  granted  hereunder.  The  Committee  may
employ such legal counsel,  consultants  and agents as it may deem desirable for
the  administration  of the Plan and may rely upon any opinion received from any
such counsel or consultant and any computation received from any such consultant
or agent. The Committee shall keep minutes of its actions under the Plan.

             ARTICLE IV - SHARES OF COMMON STOCK SUBJECT TO THE PLAN
             -------------------------------------------------------

      Subject to the provisions of Article XV, the maximum number of shares with
respect  to which the  Awards  may be  granted  under the Plan  shall not exceed
twenty  percent (20%) of the number of shares of Common Stock  outstanding  or a
maximum of  2,753,328  shares.  Any shares  subject to an Award  under the Plan,
which  Award for any reason  expires  or is  terminated  unexercised  as to such
shares,  shall again be  available  for the grant of other Awards under the Plan
provided,  however, that forfeited Common Stock or other securities shall not be
available  for further  Awards if the  participant  has realized any benefits of
ownership from such Common Stock.  Shares delivered upon exercise of the Awards,
at the election of the Board of  Directors of the Company,  may be stock that is
authorized but previously unissued or stock reacquired by the Company or both.

                             ARTICLE V - ELIGIBILITY
                             -----------------------

      The  individuals who shall be eligible to participate in the Plan shall be
Employees,  Consultants and Directors of the Company. An Employee, Consultant or
Director  who has been  granted  an Award in one year shall not  necessarily  be
entitled to be granted Awards in subsequent years.

        ARTICLE VI - GRANTS OF STOCK OPTIONS TO EMPLOYEES AND CONSULTANTS
        -----------------------------------------------------------------

      The Committee may grant  Options,  as follows,  which may be designated as
(i) NQSOs or (ii) ISOs intended to qualify under Code Section 422:

      (a) NONQUALIFIED  STOCK OPTIONS. A NQSO is a right to purchase a specified
number of shares of Common Stock during such specified time as the Committee may
determine,  not to exceed ten (10) years, at a price determined by the Committee
that, unless deemed otherwise by the Committee, is not less than the Fair Market
Value of the Common  Stock on the date the option is granted.  NQSOs  granted to
Employees  and  Consultants  shall vest at the rate of one  quarter of the total
granted on each of the first,  second, third and fourth anniversaries of the day
of the grant, subject to satisfaction of certain conditions involving continuous
periods of service or engagement.

            (i) The purchase  price of the Common Stock  subject to the NQSO may
be paid in cash. At the discretion of the Committee, the purchase price may also
be paid by the tender of Common Stock or through a  combination  of Common Stock
and cash or through such other means as the Committee  determines are consistent
with the Plan's purpose and applicable law. No fractional shares of Common Stock
will be issued or accepted.

            (ii) Without limiting the foregoing,  to the extent permitted by law
(including  relevant state law), (A) the Committee may agree to accept,  as full
or  partial  payment  of the  purchase  price of Common  Stock  issued  upon the
exercise  of the NQSO,  a  promissory  note of the  person  exercising  the NQSO
evidencing the person's  obligation to make future cash payments to the Company,
which  promissory  note shall be payable as determined by the Company (but in no
event later than five (5) years after the date  thereof),  shall be secured by a
pledge of the shares of Common Stock purchased and shall bear interest at a rate
established  by the  Committee  and (B) the Committee may also permit the person
exercising the NQSO, either on a selective or aggregate basis, to simultaneously
exercise  the NQSO and sell the shares of Common Stock  acquired,  pursuant to a
brokerage or similar arrangement  approved in advance by the Committee,  and use
the proceeds from sale as payment of the purchase price of such Common Stock.

                                       3
<PAGE>

      (b) INCENTIVE  STOCK OPTIONS.  An ISO is an Award in the form of an Option
to purchase Common Stock that complies with the requirements of Code Section 422
or any successor section.

            (i) The aggregate  Fair Market Value  (determined at the time of the
grant of the  Award) of the  shares of Common  Stock  subject  to ISOs which are
exercisable  by one person for the first time during a particular  calendar year
shall not exceed $100,000. To the extent that ISOs granted to an employee exceed
the limitation set forth in the preceding  sentence,  ISOs granted last shall be
treated as NQSOs.

            (ii) No ISO may be  granted  under  this  Plan on or after the tenth
anniversary  of the date this Plan is adopted or the date this Plan is  approved
by shareholders, whichever is earlier.

            (iii) No ISO may be exercisable more than:

                  (A) in  the  case  of an  Employee  who  is not a Ten  Percent
Shareholder,  within the  meaning of Code  Section  422,  on the date the ISO is
granted; ten (10) years after the date the ISO is granted; and

                  (B)  in  the  case  of  an  Employee  who  is  a  Ten  Percent
Shareholder,  within the  meaning of Code  Section  422,  on the date the ISO is
granted, five (5) years after the date the ISO is granted.

            (iv) The  exercise  price  of any ISO  shall  be  determined  by the
Committee and shall be no less than:

                  (A) in  the  case  of an  Employee  who  is not a Ten  Percent
Shareholder, on the date the ISO is granted, the Fair Market Value of the Common
Stock subject to the ISO on such date; and

                  (B)  in  the  case  of  an  Employee  who  is  a  Ten  Percent
Shareholder,  on the date the ISO is  granted,  not less than 110 percent of the
Fair Market Value of the Common Stock subject to the ISO on such date.

            (v) The Committee may provide that the option price under an ISO may
be paid by one or more of the methods  available  for paying the option price of
an NQSO.

            (vi) ISOs shall vest at the rate of one quarter of the total granted
on each of the first,  second,  third and fourth anniversaries of the day of the
grant,  subject to  satisfaction  of  certain  conditions  involving  continuous
periods of service or engagement.

 ARTICLE VII - GRANTS OF STOCK APPRECIATION RIGHTS TO EMPLOYEES AND CONSULTANTS
 ------------------------------------------------------------------------------

      An SAR is a right to receive,  upon  surrender  of the right,  but without
payment, an amount payable in cash.

      (i) The amount payable with respect to each SAR shall be equal in value to
the applicable  percentage of the excess,  if any, of the Fair Market Value of a
share of Common Stock on the exercise  date over the exercise  price of the SAR.
The exercise price of the SAR shall be determined by the Committee and shall not
be less than the Fair  Market  Value of a share of Common  Stock on the date the
SAR is granted.

      (ii) In the case of an SAR granted in tandem with an ISO to an Employee or
Consultant  who is a Ten  Percent  Shareholder  on the date of such  grant,  the
amount  payable  with  respect  to each  SAR  shall  be  equal  in  value to the
applicable percentage of the excess, if any, of the Fair Market Value of a share
of Common Stock on the exercise date over the exercise  price of the SAR,  which
exercise  price shall not be less than 110% of the Fair Market  Value of a share
of Common Stock on the date the SAR is granted.

      (iii) The applicable percentage and exercise price shall be established by
the Committee at the time the SAR is granted.

                                       4
<PAGE>

      (iv) SARs  shall vest at the rate of one  quarter of the total  granted on
each of the  first,  second,  third and fourth  anniversaries  of the day of the
grant,  subject to  satisfaction  of  certain  conditions  involving  continuous
periods of service or engagement.

     ARTICLE VIII - GRANTS OF RESTRICTED STOCK TO EMPLOYEES AND CONSULTANTS
     ----------------------------------------------------------------------

      Restricted  Stock is  Common  Stock of the  Company  that is  issued  to a
participant at a price determined by the Committee, which price may be zero, and
is subject to  restrictions  on  transfer  and/or  such  other  restrictions  on
incidents of ownership as the Committee may determine.

     ARTICLE IX - GRANTS OF PERFORMANCE AWARDS TO EMPLOYEES AND CONSULTANTS
     ----------------------------------------------------------------------

      A  Performance  Award  granted  under the Plan (i) may be  denominated  or
payable in cash, Common Stock (including without limitation,  Restricted Stock),
other securities or other Awards and (ii) shall confer on the holder thereof the
right to receive  payments,  in whole or in part,  upon the  achievement of such
performance  goals  during  such  performance  periods  as the  Committee  shall
establish.  Subject to the terms of the Plan and any applicable Award agreement,
the performance goals to be achieved during any performance  period,  the length
of any performance  period,  the amount of any Performance Award granted and the
amount of any payment or transfer to be made pursuant to any  Performance  Award
shall be determined by the Committee.

                ARTICLE X - GRANTS OF OTHER STOCK-BASED INCENTIVE
                      AWARDS TO EMPLOYEES AND CONSULTANTS
                      -----------------------------------

      The  Committee  may from time to time  grant  Awards  under this Plan that
provide  the  participant  with the right to purchase  Common  Stock or that are
valued by reference to the Fair Market Value of the Common Stock (including, but
not limited to, phantom securities or dividend  equivalents).  Such Awards shall
be in a form determined by the Committee (and may include terms  contingent upon
a change of control of the  Company),  provided  that such  Awards  shall not be
inconsistent  with the  terms  and  purposes  of the Plan.  The  Committee  will
determine the price of any Award and may accept any lawful consideration.

                ARTICLE XI - GRANTS OF STOCK OPTIONS TO DIRECTORS
                -------------------------------------------------

      (a)  Directors of the Company shall be eligible to receive NQSOs under the
Plan.  Each  individual who agrees to become a Director  shall receive,  on June
30th of the first  year of such  service or as of the close of  business  thirty
(30) days following his/her  election,  whichever shall first occur, and without
the exercise of the discretion of any person,  a NQSO under the Plan relating to
the purchase of 15,000 shares of Common Stock at an exercise  price equal to the
Fair Market Value. Thereafter, on June 30th of each year, each individual who is
a continuing  Director shall receive,  without the exercise of the discretion of
any person,  a NQSO under the Plan  relating to the purchase of 10,000 shares of
Common Stock.

            (i) Notwithstanding the preceding,  all continuing directors on June
30, 2001,  shall receive,  for that year only, a NQSO under the Plan relating to
the purchase of 5,000 shares of Common Stock.

      (b) The  exercise  price of each share of Common  Stock  subject to a NQSO
granted to a Director  shall  equal the Fair  Market  Value of a share of Common
Stock on the date such NQSO is granted.  The option price of a NQSO granted to a
Director may be paid in accordance with Article VI (a) (i) and (ii) of the Plan.

      (c) Each  automatic  NQSO granted to a Director  shall vest in full on the
date of the grant.  The NQSOs to  directors  shall have a term not to exceed ten
(10) years from the date of grant,  or, if later, the date the Grantee becomes a
Director. Notwithstanding the exercise period of any NQSO granted to a Director,
all such NQSOs  shall  immediately  become  exercisable  upon (i) the death of a
Director while serving as such, or (ii) a Change of Control.

                                       5
<PAGE>

                        ARTICLE XII - EXERCISE OF OPTIONS
                        ---------------------------------

      Options  granted  under the Plan may be  exercised by a Grantee only while
the  Employee,  Consultant or Director is and,  continuously  since the date the
Option was granted, has been an Employee,  Consultant or Director of the Company
or one of its subsidiaries, except that:

      (i) if the  Grantee's  termination  of employment is other than for Cause,
any  Options  held  by  the  Grantee  may  be  exercised,  to  the  extent  then
exercisable,  for a period of three months after the date of such termination of
employment;

      (ii) if such  termination  of  employment  is by reason of  retirement  or
disability,  any Options held by the Grantee at the time of death or  disability
will be exercisable for a period of 12 months after the date of such termination
of employment;

      (iii) in the event of death after  termination  of employment  pursuant to
(i) or (ii)  above,  the  person or  persons  to whom the  Grantee's  rights are
transferred by will or the laws of descent and distribution  shall have a period
of three  years from the date of  termination  of the  Grantee's  employment  to
exercise any Options which the Grantee could have exercised  during such period;
and

      (iv) in the event of the death of an Grantee while  employed,  any Options
then held by the Grantee shall become fully and immediately  exercisable and may
be  exercised  by the  person  or  persons  to whom  the  Grantee's  rights  are
transferred  by will or the laws of  descent  and  distribution  for a period of
three years after the Grantee's death. In no event, however, shall any Option be
exercisable after the date specified in Article VI, as applicable.

      An Option granted  hereunder  shall be  exercisable,  in whole or in part,
only by written  notice  delivered in person or by mail to the  Secretary of the
Company at its principal office, specifying the number of shares of Common Stock
to be purchased and  accompanied by payment  thereof and otherwise in accordance
with the option agreement pursuant to which the Option was granted.

      In  the  event  of a  Change  of  Control  affecting  the  Company,  then,
notwithstanding  any  provision  of the Plan or of any  provisions  of any Award
agreements entered into between the Company and any participant to the contrary,
all Awards that have not expired and which are then held by any  participant (or
the  person or  persons  to whom any  deceased  participant's  rights  have been
transferred)  shall, as of such Change of Control,  become fully and immediately
vested and  exercisable  and may be  exercised  for the  remaining  term of such
Awards.

                         ARTICLE XIII - AWARD AGREEMENTS
                         -------------------------------

      Each Award granted under the Plan shall be evidenced by an Award agreement
between  the  Grantee  and the  Company,  setting  forth the number of shares of
Common  Stock,  SARs,  or units  subject to the Award and such  other  terms and
conditions  applicable  to the  Award  not  inconsistent  with  the  Plan as the
Committee may deem appropriate.

                          ARTICLE XIV - TAX WITHHOLDING
                          -----------------------------

      The  Committee  may  establish  such rules and  procedures as it considers
desirable in order to satisfy any obligation of the Company or any subsidiary to
withhold  federal  income  taxes or other  taxes with  respect to any Award made
under the Plan.  Such rules and procedures may provide (i) in the case of Awards
paid in shares of Common Stock,  that the person receiving the Award may satisfy
the  withholding  obligation by  instructing  the Company to withhold  shares of
Common Stock otherwise  issuable upon exercise of such Award in order to satisfy
such withholding  obligation and (ii) in the case of an Award paid in cash, that
the  withholding  obligation  shall be satisfied by  withholding  the applicable
amount and paying the net amount in cash to the participant.

                                       6
<PAGE>

                    ARTICLE XV - DILUTION OR OTHER ADJUSTMENT
                    -----------------------------------------

      If the Company is a party to any merger or consolidation, or undergoes any
separation, reorganization or liquidation, the Board of Directors of the Company
shall  have the power to make  arrangements,  which  shall be  binding  upon the
holders of  unexpired  Awards,  for the  substitution  of new Awards for, or the
assumption  by another  corporation  of, any unexpired  Awards then  outstanding
hereunder. In the case of any ISO, such action shall be taken only in the manner
and to the extent permitted by Sections 422 and 424 of the Code. In addition, in
the event of a reclassification,  stock split, combination of shares, separation
(including a spin-off), dividend on shares of the Common Stock payable in stock,
or other  similar  change in  capitalization  or in the  corporate  structure of
shares of the Common  Stock of the Company,  the  Committee  shall  conclusively
determine  the  appropriate  adjustment  in the  option  prices  of  outstanding
Options,  in the  number  and kind of  shares  or other  securities  as to which
outstanding  Awards shall be exercisable,  and in the aggregate number of shares
with  respect to which  Awards may be granted.  In the case of any ISO, any such
adjustment in the shares or other  securities  subject to the ISO (including any
adjustment  in the  Option  price)  shall  be  made  in  such  manner  as not to
constitute a modification  as defined by Section  424(h)(3) of the Code and only
to the extent permitted by Sections 422 and 424 of the Code.

                           ARTICLE XVI - ASSIGNABILITY
                           ---------------------------

      No Award  granted  under this Plan  shall be sold,  pledged,  assigned  or
transferred  other than by will or the laws of  descent  and  distribution,  and
Awards shall be exercisable during the Grantee's lifetime only by the Grantee.

                     ARTICLE XVII - AMENDMENT OR TERMINATION
                     ---------------------------------------

      The Board of  Directors  of the Company may at any time amend,  suspend or
terminate the Plan subject to the regulatory  requirements  of the United States
Securities and Exchange  Commission  and the National  Association of Securities
Dealers or other  applicable  federal or state regulatory  authority,  provided,
however, that no change in any Awards previously granted may be made without the
consent of the holder thereof.

                       ARTICLE XVIII - GENERAL PROVISIONS
                       ----------------------------------

      (a) Common Stock acquired  pursuant to the exercise of an Option under the
Plan shall be subject  to  applicable  transfer  restrictions  under  applicable
Canadian or United States federal securities laws, under the requirements of any
national  securities  exchange or market  upon which such Common  Stock are then
listed and/or traded, and under any blue sky or state securities laws applicable
to such Common  Stock.  If the  instrument  evidencing  the Option so  provides,
Common  Stock  issued on exercise of an Option  granted  under the Plan may upon
issuance be subject to additional restrictions.

      (b) At the  discretion  of the Board of  Directors,  the  Options  and the
shares of Common Stock  received  upon exercise of an Option shall be registered
with the United States  Securities  and Exchange  Commission  and any applicable
state securities law commission.  In the absence of such registration,  both the
Options and the shares of Common Stock underlying the Options: 1) will be issued
only pursuant to an exemption  from  registration;  2) cannot be sold,  pledged,
traded or  otherwise  disposed  of in the absence of an  effective  registration
statement  or an  opinion  of  counsel  satisfactory  to the  Company  that such
registration is not required; 3) will bear an appropriate  restrictive legend to
that effect. Individuals receiving Options may be required to sign an investment
letter  satisfactory  to the  Board of  Directors  at the time the  Options  are
exercised,  and may be  required to comply  with any other  requirements  for an
exemption under the Securities Act of 1933 and any applicable  state  securities
law exemption.

                                       7
<PAGE>

      (c) The proceeds  received by the Company  from the sale of Common  Stock,
pursuant to the exercise of Options  granted  under the Plan,  shall be added to
the Company's general funds and used for general corporate purposes.

      (d) No Awards may be exercised by the holder thereof if such exercise, and
the  receipt of cash or stock  thereunder,  would be, in the  opinion of counsel
selected  by  the  Company,  contrary  to law or  the  regulations  of any  duly
constituted authority having jurisdiction over the Plan.

      (e) No Award recipient shall have any rights as a shareholder with respect
to any shares  subject  to Awards  granted to him or her under the Plan prior to
the date as of which he or she is actually recorded as the holder of such shares
upon the stock records of the Company.

      (f) Nothing  contained in the Plan or in Awards granted  thereunder  shall
confer upon any  Employee,  Consultant  or Director any right to continue in the
employ of the Company or any of its  subsidiaries  or  interfere in any way with
the right of the  Company or any of its  subsidiaries  to  terminate  his or her
employment at any time.

                          ARTICLE XIX - EFFECTIVE DATE
                          ----------------------------

      The Plan shall  become  effective on the date of its adoption by the Board
of Directors of the Company  subject to approval of the Plan by the holders of a
majority of the outstanding  voting shares of the Company within 12 months after
the date of the Plan's adoption by said Board of Directors.  In the event of the
failure to obtain such shareholder approval, the Plan shall be null and void and
the Company shall have no liability thereunder.  No Award granted under the Plan
shall be exercisable until such shareholder approval has been obtained.

                            ARTICLE XX - TERMINATION
                            ------------------------

      No Award may be  granted  under the Plan on or after the date which is ten
years  following  the  effective  date  specified  in  Article  XIX,  but Awards
previously granted may be exercised in accordance with their terms.

Adopted June 6, 1996
As amended June 5, 1997,  June 11, 1998,
February 28, 2001 and May 1, 2003

                                       8[SUNRISE SECURITIES CORP. LOGO]
                         -------------------------------
                                Member NASD/SiPC

                                                                   EXHIBIT 10(s)

                              DR. AMNON MANDELBAUM
                                MANAGING DIRECTOR
                               INVESTMENT BANKING

                TELEPHONE (212) 421-1616 FACSIMILE (212) 750-7277

Dr. Geoffrey Shulman, President & CEO
DUSA Pharmaceuticals, Inc.
25 Upton Drive
Wilmington, MA  01887

                          INVESTMENT BANKING AGREEMENT

Dear Geoff:

This  agreement  ("Agreement")  is made and entered into this February 27, 2004,
between SUNRISE  SECURITIES  CORP.  ("Sunrise") and DUSA  PHARMACEUTICALS,  INC.
(together with all  subsidiaries,  affiliates,  successors and other  controlled
units, either existing or formed subsequent to the execution of this engagement,
the "Company").

           In  consideration  of the mutual  promises  made herein and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

1.    The Company  hereby  engages  Sunrise upon the terms and conditions as set
      forth herein as its exclusive  placement agent and investment  banker with
      respect to a Financing (as defined in 3(B) below) and related matters upon
      the terms  and  conditions  set  forth  herein.  In that  regard,  Sunrise
      understands that the Company seeks Financing from the sale of 2.25 million
      shares  of  common  stock  of the  Company  at  $11.00  per  share  and an
      additional  investment  right to  provide  the  investors  the  ability to
      purchase up to 337,500  additional  shares of common  stock of the Company
      (the "Offering"). It is acknowledged and agreed that any Financing is on a
      best efforts basis only. This Agreement  should not be construed as a firm
      commitment  or guarantee of any  Financing.  Sunrise and the Company agree
      and  acknowledge  that the decision to consummate a Financing  shall be in
      the Company's sole and absolute discretion.

2.    Except as otherwise  specified in Paragraph 6 hereof, this Agreement shall
      be effective for a period of one (1) month,  commencing upon the execution
      hereof and shall  terminate  thereafter  unless  extended  upon the mutual
      written agreement of the parties.

3.    During the term of this Agreement,  Sunrise shall provide the Company with
      such regular and customary consulting advice as is reasonably requested by
      the  Company,  provided  that  Sunrise  shall not be required to undertake
      duties  not  reasonably  within  the scope of the  financial  advisory  or
      investment  banking  services  contemplated  by  this  Agreement.   It  is
      understood  and  acknowledged  by the parties  that the value of Sunrise's
      advice is not readily quantifiable, and that Sunrise shall be obligated to
      render  advice upon the request of the Company,  in good faith,  but shall
      not be obligated to spend any specific amount of time in so doing.

4.    Sunrise shall render such other financial  advisory and investment  and/or
      investment  banking  services  as may from time to time be agreed  upon in
      writing by Sunrise and the Company.

                            SUNRISE SECURITIES CORP.
               641 LEXINGTON AVE., 25TH FLOOR, NEW YORK, NY 10022

<PAGE>

5.    In  consideration  for the  services  rendered  by Sunrise to the  Company
      pursuant  to this  Agreement,  the  Company  shall  compensate  Sunrise as
      follows:

      A. At the Closing of the  Financing,  the  Company  shall issue to Sunrise
      and/or its  designees a  non-refundable  retainer  fee in the form of such
      number of shares of common stock of the Company  equal to one percent (1%)
      of the aggregate number of fully diluted and/or converted shares of common
      stock and/or  common stock  equivalents  as are purchased by Investors (as
      defined below) (the "Retainer Fee").

      B. Also, upon the Closing of Financing, the Company shall issue to Sunrise
      and/or its designees  such number of shares of common stock of the Company
      equal to five percent (5%) of the aggregate number of fully diluted and/or
      converted  shares of common stock and/or common stock  equivalents  as are
      purchased  by  Investors  (the  "Financing  Fee").  For  the  purposes  of
      Financing, Sunrise will enter into a selected dealer agreement dated as of
      February 27, 2004  ("Dealer  Agreement")  with Roth Capital and  Flagstone
      Securities Corp. (collectively,  the "Participating Dealers"). Sunrise and
      the  Company  agree that  pursuant  to the Dealer  Agreement  and upon the
      closing of the Financing,  Sunrise will pay the  Participating  Dealers at
      the  sole  election  of  Sunrise  either:  (i)  the  aggregate  amount  of
      US$200,000  in cash,  or (ii) such number of shares of common stock of the
      Company equal to US$200,000  calculated at the same purchase price paid by
      the Investors.  However, in any and all events, the Company agrees that if
      the Participating Dealers are entitled to receive more than US$200,000 (in
      cash or stock as described above), the Company shall accordingly  increase
      the  Financing  Fee payable to Sunrise to cover any such  additional  fees
      payable to the Participating  Dealers by Sunrise.  Convertible  securities
      shall be treated as equity for purposes of calculating  the Financing Fee.
      Securities   acquired  or   otherwise   received  by   financing   sources
      ("Investors")  are  referred  to as  "Securities."  In the event that this
      Agreement   shall  not  be  renewed  or  if  terminated  for  any  reason,
      notwithstanding  any such  non-renewal  or  termination,  Sunrise shall be
      entitled to a full fee as  provided  under  Paragraph  5 hereof,  upon the
      receipt of proceeds by the Company  from the sale of the  Securities.  For
      the  purposes  of this  Agreement,  the term  "Financing"  shall  mean the
      financing or equity investment in the Company,  or any combination thereof
      (i.e., where the funds are received by the Company, as distinct from funds
      received  by  selling   shareholders)described   above  as  the  Offering.
      Sunrise's  fee  shall be  based  upon the  percentages  set  forth in this
      Paragraph 5B above of the gross proceeds before any deductions,  including
      but  not  limited  to  fees,  deposits,  transaction  expenses,  reserves,
      insurance or other  amounts  withheld or paid by the  Investor.  Financing
      shall be deemed to include  total  value of  Securities  sold  directly or
      indirectly, in connection with the Financing,  including proceeds received
      by the Company upon exercise of the  Additional  Investment  Right Shares,
      and any amounts  paid into  escrow and any  amounts  payable in the future
      whether or not subject to any contingency.

6.    In  the  event  that  this  Agreement  shall  not be  renewed  or if it is
      terminated, without closing any Financing, for any reason, notwithstanding
      any such  non-renewal or termination,  Sunrise shall be entitled to a full
      fee as provided under any other Financing, for the Financing that includes
      the  participation  of any one or  more of the  parties  on the  List  (as
      defined below) which is consummated  within a period of twelve (12) months
      after such  non-renewal or termination of this Agreement.  The list (which
      list  shall  be  deemed  to  include  all  of  such  parties'   respective
      subsidiaries,  affiliates,  successors and other controlled units,  either
      existing  or  formed  subsequent  to  the  execution  of  this  Agreement,
      collectively,  the "List") of parties  which shall govern the operation of
      this Paragraph 6 is attached hereto and made a part hereof as Exhibit A.

7.    In addition to the fees  payable  hereunder,  and  regardless  whether any
      Financing set forth in Paragraph 6 hereof is proposed or consummated,  the
      Company shall reimburse  Sunrise for all reasonable fees and disbursements
      of  Sunrise's  outside  counsel for the  drafting and review of the Dealer
      Agreement not to exceed $5,000.00.

                            SUNRISE SECURITIES CORP.
               641 LEXINGTON AVE., 25TH FLOOR, NEW YORK, NY 10022

                                                                               2
<PAGE>

8.    The Company  acknowledges  that all opinions and advice  (written or oral)
      given by Sunrise to the Company in connection  with  Sunrise's  engagement
      are intended  solely for the benefit and use of the Company in considering
      the transaction or financing to which they relate,  and the Company agrees
      that no person or entity other than the Company  shall be entitled to make
      use of or rely upon the advice of Sunrise  to be given  hereunder,  and no
      such opinion or advice shall be used for any other purpose or  reproduced,
      disseminated,  quoted or referred to at any time, in any manner or for any
      purpose, nor may the Company make any public references to Sunrise, or use
      Sunrise's  name in any annual  reports or any other reports or releases of
      the Company without  Sunrise's prior written  consent,  which shall not be
      unreasonably withheld.

9.    The  Company  acknowledges  that  Sunrise  and its  affiliates  are in the
      business of providing  financial services and consulting advice to others.
      Nothing herein  contained shall be construed to limit or restrict  Sunrise
      in conducting  such business with respect to others,  or in rendering such
      advice to others,  except as such advice may relate to matters relating to
      the Company's business and properties.

10.   The Company  recognizes  and confirms that, in advising the Company and in
      fulfilling  its engagement  hereunder,  Sunrise will use and rely on data,
      material and other  information  furnished to Sunrise by the Company.  The
      Company acknowledges and agrees that in performing its services under this
      engagement, Sunrise may rely upon the data, material and other information
      supplied by the Company  without  independently  verifying  its  accuracy,
      completeness  or  veracity,  except  to  the  extent  Sunrise  has  actual
      knowledge to the contrary.  The Company represents and warrants to Sunrise
      that all such  information  concerning the Company provided by the Company
      in  response to requests  made by Sunrise or  otherwise,  will be true and
      accurate  in all  material  respects  and  will  not  contain  any  untrue
      statement of a material fact or omit to state a material fact necessary in
      order  to make  the  statements  therein  not  misleading  in light of the
      circumstances under which such statements are made. Sunrise shall be under
      no  obligations  to  make  an  independent   appraisal  of  assets  or  an
      investigation  or  inquiry  as  to  any  information  regarding,   or  any
      representations  of, any other participant in a Financing,  and shall have
      no liability with regard thereto. The Company acknowledges and agrees that
      Sunrise  will be using and relying upon such  information  supplied by the
      Company  and its  officers,  agents  and  others  and any  other  publicly
      available  information  concerning  the Company  without  any  independent
      investigation or verification thereof or independent  appraisal by Sunrise
      of the Company or its business or assets.  If, in Sunrise's  opinion after
      completion  of its due  diligence  process,  the condition of the Company,
      financial  or  otherwise,  and  its  prospects  are not  substantially  as
      represented or do not fulfill Sunrise's  expectations,  Sunrise shall have
      the sole  discretion to review and  determine  its  continued  interest in
      proposed  Financings.  The Company further represents and agrees that: (i)
      the  Company is not  obligated  to pay any finder in  connection  with any
      proposed  Financing  pursuant to this Agreement and, in any and all events
      that any parties other than Sunrise or the Participating Dealers set forth
      in Paragraph 5B above ("Other Parties") seek compensation  relating to the
      closing of any proposed  Financing,  Sunrise  shall be entitled to receive
      its full  compensation from the Company as set forth in this Agreement and
      that Sunrise shall have no obligation whatsoever to pay any Other Parties,
      (ii) the Company shall deliver at the closing of each Financing  conducted
      hereunder: (a) a certificate of each of the Company's President and CFO to
      the effect that the Company's  information  provided to the Investors does
      not contain  any untrue  statement  of material  fact or fail to state any
      material  fact  required  to be stated  therein or  necessary  to make the
      statements therein not misleading,  and all necessary  corporate approvals
      have been  obtained  to enable the Company to deliver  the  Securities  in
      accordance  with the terms of the  Financing,  and (b) a 10b-5  opinion of
      counsel  for the  Company  satisfactory  to Sunrise to the effect that the
      Company's  information  provided to the  Investors  does not (except  with
      respect to the  financial  statements  or forecasts as to which no opinion
      need be expressed)  contain any untrue  statement of material fact or fail
      to state any material fact  required to be stated  therein or necessary to
      make the statements therein not misleading,  in light of the circumstances
      in which  they were  made,  and such  other  opinions  as  Sunrise  and/or
      Sunrise's counsel shall reasonably  require,  (iii) as of the date hereof,
      there is no  litigation  pending or involving  the business or property of
      the  Company  except  as  disclosed  in the  Company's  filings  with  the
      Securities  and  Exchange  Commission  ("SEC"),  (iv) the Company  owns or
      possesses free of all encumbrances its assets,  trademarks,  patents,  and
      copyrights  necessary  to conduct its  business  except for the  Company's
      Citizens Bank loan as disclosed in the Company's filings with the SEC, (v)
      all taxes which are due and payable by the Company  have been paid in full
      and the Company has no tax  deficiency or claims  outstanding  or proposed
      against it, (vi) the  financial  statements of the Company as of September
      30, 2003,  present the  financial  position as of the date hereof and such
      financial  statements  have been  prepared in  accordance  with  generally
      accepted accounting principals,  and (vii) all "blue sky" legal work shall
      be performed by the Company's counsel at the Company's sole expense.

                            SUNRISE SECURITIES CORP.
               641 LEXINGTON AVE., 25TH FLOOR, NEW YORK, NY 10022

                                                                               3

<PAGE>

11.   Since Sunrise will be acting on behalf of the Company in  connection  with
      its  engagement  hereunder,  the Company and Sunrise  have  entered into a
      separate  indemnification  agreement  substantially  in the form  attached
      hereto  as  Schedule  A and  dated  the  date  hereof,  providing  for the
      indemnification  of Sunrise by the Company.  Sunrise has entered into this
      Agreement in reliance on the indemnities set forth in such indemnification
      agreement.

12.   Sunrise shall perform its services hereunder as an independent  contractor
      and not as an  employee  of the  Company or an  affiliate  thereof.  It is
      expressly  understood  and agreed to by the parties  hereto  that  Sunrise
      shall have no authority  to act for,  represent or bind the Company or any
      affiliate  thereof in any manner,  except as may be agreed to expressly by
      the Company in writing from time to time.

13.   Sunrise  hereby  waives its right to receive any shares of Common Stock of
      the Company with respect to any  Effectiveness  Failure,  Filing  Failure,
      Maintenance  Failure or AIR  Exercisability  Failure under Section 2.f. of
      the Registration Rights Agreement.

14.   A. This Agreement and the Schedule A attached hereto constitute the entire
      agreement and  understanding of the parties hereto,  and supersede any and
      all  previous  agreements  and  understandings,  whether  oral or written,
      between the parties with respect to the matters set forth herein.

      B. Any notice or communication permitted or required hereunder shall be in
      writing and shall be deemed  sufficiently  given if hand-delivered or sent
      (i) postage prepaid by registered mail, return receipt requested,  or (ii)
      by facsimile  to the  respective  parties as set forth  below,  or to such
      other address as either party may notify the other of in writing:

if to the Company, to:            DUSA PHARMACEUTICALS, INC.
                                  25 Upton Drive
                                  Wilmington, MA  01887

                                  Attn: Dr. Geoffrey Shulman, President & CEO

if to Sunrise, to:                SUNRISE SECURITIES CORP.
                                  641 Lexington Ave., 25th Floor
                                  New York, New York  10022
                                  Attn: Dr. Amnon Mandelbaum, Managing Director

                            SUNRISE SECURITIES CORP.
               641 LEXINGTON AVE., 25TH FLOOR, NEW YORK, NY 10022

                                                                               4
<PAGE>

      C. This  Agreement  shall be binding upon and inure to the benefit of each
      of  the   parties   hereto   and  their   respective   successors,   legal
      representatives and assigns.

      D. This Agreement may be executed in any number of  counterparts,  each of
      which together shall constitute one and the same original  document.  This
      Agreement  may be executed and  delivered by exchange of facsimile  copies
      showing the parties' signatures,  and those signatures need not be affixed
      to the same copy.  The  facsimile  copies  showing the  signatures  of the
      parties will  constitute  originally  signed copies of the same  Agreement
      requiring no further execution.

      E. No  provision  of this  Agreement  may be amended,  modified or waived,
      except in a writing signed by all of the parties hereto.

      F. This  Agreement  shall be construed in accordance  with and governed by
      the laws of the State of New York,  without  giving effect to its conflict
      of law  principles.  The parties  hereby agree that any dispute  which may
      arise  between them arising out of or in  connection  with this  Agreement
      shall be  adjudicated  before a court  located in New York City,  and they
      hereby submit to the exclusive  jurisdiction of the courts of the State of
      New York  located in New York,  New York and of the federal  courts in the
      Southern  District  of New  York  with  respect  to any  action  or  legal
      proceeding  commenced by any party,  and  irrevocably  waive any objection
      they now or hereafter may have  respecting the venue of any such action or
      proceeding  brought in such a court or respecting the fact that such court
      is an  inconvenient  forum,  relating to or arising out of this Agreement,
      and  consent  to the  service  of  process  in any  such  action  or legal
      proceeding  by means of  registered  or  certified  mail,  return  receipt
      requested, in care of the address set forth in Paragraph 13B hereof.

      The  parties  hereby  waive  trial  by jury in any  action  or  proceeding
      involving, directly or indirectly, any matter in any way arising out of or
      in connection with this Agreement.

      Please  note  that  capitalized   terms  not  otherwise  defined  in  this
      Investment   Banking  Letter  shall  have  the  meanings  defined  in  the
      Securities   Purchase   Agreement,   Registration   Rights  Agreement  and
      Additional   Investment  Right  Agreement  between  the  Company  and  the
      Investors.

      If the foregoing  correctly sets forth the  understanding  between Sunrise
      and the Company with  respect to the  foregoing,  please so indicate  your
      agreement  by  signing  in the place  provided  below,  at which time this
      letter shall become a binding contract.

                               SUNRISE SECURITIES CORP.
                               By Its Authorized Signatory:

                               By:/s/ Nathan Low
                                  -----------------------------
                                   Nathan Low, President

                            SUNRISE SECURITIES CORP.
               641 LEXINGTON AVE., 25TH FLOOR, NEW YORK, NY 10022

                                       5
<PAGE>

Accepted and Agreed:

DUSA PHARMACEUTICALS, INC.
By Its Authorized Signatory:

By:/s/ D. Geoffrey Shulman
   --------------------------------------------
Name:  D. Geoffrey Shulman
Title:  President and Chief Executive Officer

                            SUNRISE SECURITIES CORP.
               641 LEXINGTON AVE., 25TH FLOOR, NEW YORK, NY 10022

                                       6
<PAGE>

                                Member NASD/SiPC

                                   SCHEDULE A
                           INDEMNIFICATION PROVISIONS
--------------------------------------------------------------------------------

In connection  with the engagement of SUNRISE  SECURITIES  CORP.  ("Sunrise") by
DUSA PHARMACEUTICALS,  INC. (the "Company") pursuant to a letter agreement dated
February __, 2004 between the Company and Sunrise as it may be amended from time
to time (the "Letter Agreement"), the Company, hereby agrees as follows:

1.    In  connection  with or arising out of or relating  to the  engagement  of
      Sunrise  under the Letter  Agreement,  or any  actions  taken or  omitted,
      services  performed or matters  contemplated  by or in connection with the
      Letter Agreement,  the Company agrees to reimburse Sunrise, its affiliates
      and  their  respective   directors,   officers,   employees,   agents  and
      controlling persons (each an "Indemnified Party") promptly upon demand for
      actual, out-of-pocket expenses (including reasonable fees and expenses for
      legal counsel) as they are incurred in connection  with the  investigation
      of,  preparation for or defense of any pending or threatened claim, or any
      litigation, proceeding or other action in respect thereof (collectively, a
      "Claim").  The Company also agrees (in  connection  with the foregoing) to
      indemnify and hold harmless  each  Indemnified  Party from and against any
      and all out-of-pocket losses,  claims,  damages and liabilities,  joint or
      several, to which any Indemnified Party may become subject,  including any
      amount paid in settlement of any litigation or other action  (commenced or
      threatened)  to which the Company  shall have  consented in writing  (such
      consent not to be unreasonably  withheld),  whether or not any Indemnified
      Party is a party and whether or not liability resulted; provided, however,
      that the Company shall not be liable  pursuant to this sentence in respect
      of any loss,  claim,  damage or  liability  to the extent  that a court or
      other agency having competent  jurisdiction shall have determined by final
      judgement (not subject to further appeal) that such loss, claim, damage or
      liability was incurred solely as a direct result of the willful misconduct
      or gross negligence of such Indemnified Party.

2.    An  Indemnified  Party  shall  have the  right  to  retain  legal  counsel
      designated  by the Company to conduct the defense and all related  matters
      in connection  with any Claim.  The Company shall pay the reasonable  fees
      and expenses of such legal counsel,  and such counsel shall to the fullest
      extent, consistent with its professional responsibilities,  cooperate with
      the  Company.  At an  Indemnified  Party's sole  election,  in lieu of the
      Company's legal counsel, an Indemnified Party shall also have the right to
      retain separate legal counsel of its own choice to conduct the defense and
      all related  matters in connection  with any Claim.  The Company shall pay
      the reasonable  fees and expenses of such legal counsel,  and such counsel
      shall  to  the   fullest   extent,   consistent   with  its   professional
      responsibilities,  cooperate  with  the  Company  and  any  legal  counsel
      designated by the Company, provided,  however, that, the Company shall pay
      such fees and expenses of such legal  counsel only in the event that there
      is a  conflict  of  interest  with  representation  by the  legal  counsel
      designated by the Company for such Indemnified Party.

3.    The  Company  will  not,   without  the  prior  written  consent  of  each
      Indemnified  Party  settle,  compromise  or  consent  to the  entry of any
      judgement  in  any  pending  or  threatened  Claim  in  respect  of  which
      indemnification  may be reasonably  sought  hereunder  (whether or not any
      Indemnified Person is an actual or potential party to such Claim),  unless
      such  settlement,   compromise  or  consent  includes  an   unconditional,
      irrevocable release of each Indemnified Person against whom such Claim may
      be brought hereunder from any and all liability arising out of such Claim.

4.    In the event the  indemnity  provided for in  paragraphs 1 and 2 hereof is
      unavailable or insufficient to hold any Indemnified  Party harmless,  then
      the Company shall  contribute to amounts paid or payable by an Indemnified
      Party in respect of such Indemnified Party's losses,  claims,  damages and
      liabilities  as to which the indemnity  provided for in paragraphs 1 and 2
      hereof is unavailable or insufficient (i) in such portion as appropriately
      reflects the relative benefits  received by the Company,  on the one hand,
      and the  Indemnified  Party,  on the other hand,  in  connection  with the
      matters as to which losses, claims, damages or liabilities relate, or (ii)
      if the  allocation  provided by (i) above is not  permitted by  applicable
      law, in such  proportion as  appropriately  reflects not only the relative
      benefits  referred  to in clause  (i) but also the  relative  fault of the
      Company, on the one hand, and the Indemnified  Parties, on the other hand,
      as well as any other equitable considerations. The amounts paid or payable
      by a party in respect of losses,  claims, damages and liabilities referred
      to  above  shall  be  deemed  to  include  any  reasonable  legal or other
      out-of-pocket  fees and  expenses  incurred in defending  any  litigation,
      proceeding  or other  action  or  claim.  Notwithstanding  the  provisions
      hereof,  Sunrise's share of the liability hereunder shall not be in excess
      of the  amount of fees  actually  received  by  Sunrise  under the  Letter
      Agreement  (excluding any amounts received as reimbursement of expenses by
      Sunrise).

                            SUNRISE SECURITIES CORP.
               641 LEXINGTON AVE., 25TH FLOOR, NEW YORK, NY 10022

<PAGE>

5.    It is understood and agreed that, in connection with Sunrise's  engagement
      by the Company under the Letter Agreement,  Sunrise may also be engaged to
      act for the  Company in one or more  additional  capacities,  and that the
      terms of any such  additional  engagement  may be  embodied in one or more
      separate written agreements.  These Indemnification Provisions shall apply
      to the engagement  under the Letter  Agreement and to any such  additional
      engagement and any modification of such additional  engagement;  provided,
      however,  that in the event that the Company  engages  Sunrise to act as a
      dealer  manager in an exchange  or tender  offer or as an  underwriter  in
      connection with the issuance of securities by the Company or to furnish an
      opinion  letter,  such  further  engagement  may be  subject  to  separate
      indemnification  and  contribution  provisions  as may be mutually  agreed
      upon.

6.    These Indemnification  Provisions shall remain in full force and effect in
      connection  with the  transaction  contemplated  by the  Letter  Agreement
      whether or not consummated, and shall survive the expiration of the period
      of the Letter  Agreement,  and shall be in addition to any liability  that
      the Company might otherwise have to any Indemnified Party under the Letter
      Agreement or otherwise.

7.    Each party hereto consents to personal jurisdiction and service of process
      and  venue in any  court in the  State of New York in which  any claim for
      indemnity is brought by any Indemnified Person.

8.    These  Indemnification  Provisions  may  be  executed  in  any  number  of
      counterparts,  each of which shall be deemed an original  but all of which
      when taken together shall  constitute one and the same  instrument.  These
      Indemnification  Provisions  may be delivered by facsimile,  and facsimile
      signatures  shall be treated as  original  signatures  for all  applicable
      purposes.

SUNRISE SECURITIES CORP.
By Its Authorized Signatory:

By: /s/ Nathan Low
   ---------------------------------
           Nathan Low, President

DUSA PHARMACEUTICALS, INC.
By Its Authorized Signatory:

By:  /s/ D. Geoffrey Shulman
   --------------------------------------------
Name:  D. Geoffrey Shulman
Title:  President and Chief Executive Officer

                            SUNRISE SECURITIES CORP.
               641 LEXINGTON AVE., 25TH FLOOR, NEW YORK, NY 10022

                                                                               2

<PAGE>

                                    EXHIBIT A

Pursuant to Paragraph 6 of the Investment Banking Agreement ("Agreement") by and
between Sunrise  Securities  Corp.  ("Sunrise") and DUSA  Pharmaceuticals,  Inc.
(together with all  subsidiaries,  affiliates,  successors and other  controlled
units,  either existing or formed subsequent to the execution of this Exhibit A,
the "Company") dated as of February 27, 2004, for purposes of the Agreement, the
definition  of the parties  included on the "List" shall include any one or more
of  the  parties  set  forth  below  together  with  any  of  their   respective
subsidiaries and/or affiliates.

      1.    Omicron Master Trust

      2.    Langley Partners, L.P.

      3.    Mainfield Enterprises Inc.

      4.    Portside Growth and Opportunity Fund

      5.    Smithfield Fiduciary LLC

      6.    Cranshire Capital L.P.

      7.    Paul Scharfer

      8.    Sunrise Equity Partners, LP

      9.    Vertical Ventures, LLC

      10.   Sunrise Securities Corp.

SUNRISE SECURITIES CORP.                   DUSA PHARMACEUTICALS, INC.
By Its Authorized Signatory                By Its Authorized Signatory

By:/s/ Nathan Low                          By: /s/ D. Geoffrey Shulman
   ----------------------------               ----------------------------------
     Nathan Low, President                 Name: D. Geoffrey Shulman
                                           Title: President and Chief
                                                   Executive Officer

                            SUNRISE SECURITIES CORP.
               641 LEXINGTON AVE., 25TH FLOOR, NEW YORK, NY 10022

                                                                               3

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