Document:

Form of Common Stock Purchase Warrant

THIS WARRANT AND THE SHARES OF COMMON
STOCK ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED. THIS WARRANT AND THE COMMON STOCK ISSUABLE UPON EXERCISE OF THIS
WARRANT MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT AS TO THIS WARRANT UNDER SAID ACT OR AN OPINION OF
COUNSEL REASONABLY SATISFACTORY TO STOCKERYALE, INC. THAT SUCH REGISTRATION IS NOT
REQUIRED. 

                                                     		
                                                         
                                                         Right to Purchase 95,000 Shares of Common Stock of StockerYale,  Inc.  (subject to
                                                     adjustment as provided herein)

                                                         

COMMON STOCK PURCHASE
WARRANT 

	No. __________	
    Issue Date: December ___, 2004

    

STOCKERYALE,
INC., a corporation organized under the laws of the State of Massachusetts (the
“Company”), hereby certifies that, for value received, LAURUS MASTER FUND, LTD.,
or assigns (the “Holder”), is entitled, subject to the terms set forth below, to
purchase from the Company from and after the Issue Date of this Warrant and at any time or
from time to time before 5:00 p.m., New York time, through seven (7) years after such date
(the “Expiration Date”), up to 95,000 fully paid and nonassessable shares of
Common Stock (as hereinafter defined), $.001 par value, of the Company, at the Exercise
Price (as defined below). The number and character of such shares of Common Stock and the
Exercise Price are subject to adjustment as provided herein. 

As
used herein the following terms, unless the context otherwise requires, have the following
respective meanings: (a) The term “Company” shall include StockerYale, Inc. and
any corporation which shall succeed or assume the obligations of StockerYale, Inc.
hereunder. 

     (b)
          The term “Common Stock” includes (a) the Company’s Common Stock,
          par value $.001 per share, and (b) any other securities into which or for which
          any of the securities described in (a) may be converted or exchanged pursuant to
          a plan of recapitalization, reorganization, merger, sale of assets or otherwise. 

     (c) The term "Other
     Securities" refers to any stock (other than Common Stock) and other
     securities of the Company or any other person (corporate or otherwise)
     which the holder of the Warrant at any time shall be entitled to receive,
     or shall have received, on the exercise of the Warrant, in lieu of or in
     addition to Common Stock, or which at any time shall be issuable or shall
     have been issued in exchange for or in replacement of Common Stock or Other
     Securities pursuant to Section 4 or otherwise. 

     (d) The term "Exercise Price" shall be as
     follows: 

     a. 50,000 shares at $1.38 per share; 

     b. 33,000 shares at $1.60 per share; and 

     c. 12,000 shares at $1.71 per share. 

      1. Exercise of Warrant. 

1.1 Number of Shares Issuable upon
Exercise. From and after the date hereof through and including the Expiration Date,
the Holder shall be entitled to receive, upon exercise of this Warrant in whole or in
part, by delivery of an original or fax copy of the exercise notice attached hereto as
Exhibit A (the “Exercise Notice”), shares of Common Stock of the Company,
subject to adjustment pursuant to Section 4. 

1.2 Fair Market Value. Fair
Market Value of a share of Common Stock as of a particular date (the “Determination
Date”) shall mean: 

(a) If the Company’s Common Stock is traded on an exchange or
is quoted on the National or SmallCap Market of The Nasdaq Stock Market,
Inc.(“Nasdaq”), then the closing or last sale price, respectively, reported for
the last business day immediately preceding the Determination Date. 

     (b)
          If the Company’s Common Stock is not traded on an exchange or on the Nasdaq
          but is traded on the NASD OTC Bulletin Board or BBX Exchange, then the mean of
          the average of the closing bid and asked prices reported for the last business
          day immediately preceding the Determination Date. 

     (c)
          Except as provided in clause (d) below, if the Company’s Common Stock is
          not publicly traded, then as the Holder and the Company agree or in the absence
          of agreement by arbitration in accordance with the rules then in effect of the
          American Arbitration Association, before a single arbitrator to be chosen from a
          panel of persons qualified by education and training to pass on the matter to be
          decided. 

     (d)
          If the Determination Date is the date of a liquidation, dissolution or winding
          up, or any event deemed to be a liquidation, dissolution or winding up pursuant
          to the Company’s charter, then all amounts to be payable per share to
          holders of the Common Stock pursuant to the charter in the event of such
          liquidation, dissolution or winding up, plus all other amounts to be payable per
          share in respect of the Common Stock in liquidation under the charter, assuming
          for the purposes of this clause (d) that all of the shares of Common Stock then
          issuable upon exercise of the Warrant are outstanding at the Determination Date. 

     
          2. Procedure for Exercise. 

2.1 Delivery of Stock
Certificates, etc. on Exercise. The Company agrees that the shares of Common Stock
purchased upon exercise of this Warrant shall be deemed to be issued to the Holder as the
record owner of such shares as of the close of business on the date on which this Warrant
shall have been surrendered and payment made for such shares as aforesaid. As soon as
practicable after the exercise of this Warrant in full or in part, and in any event within
3 business days thereafter, the Company at its expense (including the payment by it of any
applicable issue taxes) will cause to be issued in the name of and delivered to the
Holder, or as such Holder (upon payment by such holder of any applicable transfer taxes)
may direct in compliance with applicable securities laws, a certificate or certificates
for the number of duly and validly issued, fully paid and nonassessable shares of Common
Stock (or Other Securities) to which such Holder shall be entitled on such exercise, plus,
in lieu of any fractional share to which such holder would otherwise be entitled, cash
equal to such fraction multiplied by the then Fair Market Value of one full share,
together with any other stock or other securities and property (including cash, where
applicable) to which such Holder is entitled upon such exercise pursuant to Section 1 or
otherwise. 

2.2      Exercise.

     
     

     (a)
          Payment may be made either in (i) cash or by certified or official bank check
          payable to the order of the Company equal to the applicable aggregate Exercise
          Price, (ii) by delivery of the Warrant, Common Stock and/or Common Stock
          receivable upon exercise of the Warrant in accordance with Section (b) below, or
          (iii) by a combination of any of the foregoing methods, for the number of Common
          Shares specified in such form (as such exercise number shall be adjusted to
          reflect any adjustment in the total number of shares of Common Stock issuable to
          the holder per the terms of this Warrant) and the Holder shall thereupon be
          entitled to receive the number of duly authorized, validly issued, fully-paid
          and non-assessable shares of Common Stock (or Other Securities) determined as
          provided herein. 

     (b)
          Notwithstanding any provisions herein to the contrary, if the Fair Market Value
          of one share of Common Stock is greater than the Exercise Price (at the date of
          calculation as set forth below), in lieu of exercising this Warrant for cash,
          the Holder may elect to receive shares equal to the value (as determined below)
          of this Warrant (or the portion thereof being exercised) by surrender of this
          Warrant at the principal office of the Company together with the properly
          endorsed Exercise Notice in which event the Company shall issue to the Holder a
          number of shares of Common Stock computed using the following formula: 

X=Y (A-B) 

                  A 

	
    Where 
	
    X=
	
    
    the number of shares of
    Common Stock to be issued to the Holder 
    

	
    
	
    Y=
	
    
    the number of shares of Common Stock purchasable under the Warrant or, if
    only a portion of the Warrant is being exercised, the portion of the Warrant
    being exercised (at the date of such calculation)

	
    
	
    A=
	
    
    the Fair Market Value of one share of the Company's Common Stock (at the
    date of such calculation)

	
    
	
    B=
	

    Exercise Price (as adjusted to the date of such calculation)

    

3. Effect of Reorganization,
etc.; Adjustment of Exercise Price.

3.1 Reorganization, Consolidation,
Merger, etc. In case at any time or from time to time, the Company shall (a) effect a
reorganization, (b) consolidate with or merge into any other person, or (c) transfer all
or substantially all of its properties or assets to any other person under any plan or
arrangement contemplating the dissolution of the Company, then, in each such case, as a
condition to the consummation of such a transaction, proper and adequate provision shall
be made by the Company whereby the Holder of this Warrant, on the exercise hereof as
provided in Section 1 at any time after the consummation of such reorganization,
consolidation or merger or the effective date of such dissolution, as the case may be,
shall receive, in lieu of the Common Stock (or Other Securities) issuable on such exercise
prior to such consummation or such effective date, the stock and other securities and
property (including cash) to which such Holder would have been entitled upon such
consummation or in connection with such dissolution, as the case may be, if such Holder
had so exercised this Warrant, immediately prior thereto, all subject to further
adjustment thereafter as provided in Section 4. 

3.2 Dissolution. In the event
of any dissolution of the Company following the transfer of all or substantially all of
its properties or assets, the Company, prior to such dissolution, shall at its expense
deliver or cause to be delivered the stock and other securities and property (including
cash, where applicable) receivable by the Holder of the Warrant after the effective date
of such dissolution pursuant to Section 3.1 to a bank or trust company having its
principal office in New York, NY, as trustee for the Holder of the Warrant. 

3.3 Continuation of Terms.
Upon any reorganization, consolidation, merger or transfer (and any dissolution following
any transfer) referred to in this Section 3, this Warrant shall continue in full force and
effect and the terms hereof shall be applicable to the shares of stock and other
securities and property receivable on the exercise of this Warrant after the consummation
of such reorganization, consolidation or merger or the effective date of dissolution
following any such transfer, as the case may be, and shall be binding upon the issuer of
any such stock or other securities, including, in the case of any such transfer, the
person acquiring all or substantially all of the properties or assets of the Company,
whether or not such person shall have expressly assumed the terms of this Warrant as
provided in Section 4. In the event this Warrant does not continue in full force and
effect after the consummation of the transactions described in this Section 3, then only
in such event will the Company’s securities and property (including cash, where
applicable) receivable by the holders of the Warrant be delivered to the Trustee as
contemplated by Section 3.2. 

     4.
          Extraordinary Events Regarding Common Stock. In the event that the
          Company shall (a) issue additional shares of the Common Stock as a dividend or
          other distribution on outstanding Common Stock, (b) subdivide its outstanding
          shares of Common Stock, or (c) combine its outstanding shares of the Common
          Stock into a smaller number of shares of the Common Stock, then, in each such
          event, the Exercise Price shall, simultaneously with the happening of such
          event, be adjusted by multiplying the then Exercise Price by a fraction, the
          numerator of which shall be the number of shares of Common Stock outstanding
          immediately prior to such event and the denominator of which shall be the number
          of shares of Common Stock outstanding immediately after such event, and the
          product so obtained shall thereafter be the Exercise Price then in effect. The
          Exercise Price, as so adjusted, shall be readjusted in the same manner upon the
          happening of any successive event or events described herein in this Section 4.
          The number of shares of Common Stock that the holder of this Warrant shall
          thereafter, on the exercise hereof as provided in Section 1, be entitled to
          receive shall be increased to a number determined by multiplying the number of
          shares of Common Stock that would otherwise (but for the provisions of this
          Section 4) be issuable on such exercise by a fraction of which (a) the numerator
          is the Exercise Price that would otherwise (but for the provisions of this
          Section 4) be in effect, and (b) the denominator is the Exercise Price in effect
          on the date of such exercise. 

     5.
          Certificate as to Adjustments. In each case of any adjustment or
          readjustment in the shares of Common Stock (or Other Securities) issuable on the
          exercise of the Warrant, the Company at its expense will promptly cause its
          Chief Financial Officer or other appropriate designee to compute such adjustment
          or readjustment in accordance with the terms of the Warrant and prepare a
          certificate setting forth such adjustment or readjustment and showing in detail
          the facts upon which such adjustment or readjustment is based, including a
          statement of (a) the consideration received or receivable by the Company for any
          additional shares of Common Stock (or Other Securities) issued or sold or deemed
          to have been issued or sold, (b) the number of shares of Common Stock (or Other
          Securities) outstanding or deemed to be outstanding, and (c) the Exercise Price
          and the number of shares of Common Stock to be received upon exercise of this
          Warrant, in effect immediately prior to such adjustment or readjustment and as
          adjusted or readjusted as provided in this Warrant. The Company will forthwith
          mail a copy of each such certificate to the holder of the Warrant and any
          Warrant agent of the Company (appointed pursuant to Section 11 hereof). 

     6.
          Reservation of Stock, etc. Issuable on Exercise of Warrant. The Company
          will at all times reserve and keep available, solely for issuance and delivery
          on the exercise of the Warrant, shares of Common Stock (or Other Securities)
          from time to time issuable on the exercise of the Warrant. 

     7.
          Assignment; Exchange of Warrant. Subject to compliance with applicable
          securities laws, this Warrant, and the rights evidenced hereby, may be
          transferred by any registered holder hereof (a “Transferor”) with
          respect to any or all of the Shares. On the surrender for exchange of this
          Warrant, with the Transferor’s endorsement in the form of Exhibit B
          attached hereto (the “Transferor Endorsement Form”) and together with
          evidence reasonably satisfactory to the Company demonstrating compliance with
          applicable securities laws, which shall include, without limitation, a legal
          opinion from the Transferor’s counsel that such transfer is exempt from the
          registration requirements of applicable securities laws, the Company at its
          expense but with payment by the Transferor of any applicable transfer taxes)
          will issue and deliver to or on the order of the Transferor thereof a new
          Warrant of like tenor, in the name of the Transferor and/or the transferee(s)
          specified in such Transferor Endorsement Form (each a “Transferee”),
          calling in the aggregate on the face or faces thereof for the number of shares
          of Common Stock called for on the face or faces of the Warrant so surrendered by
          the Transferor. 

     8.
          Replacement of Warrant. On receipt of evidence reasonably satisfactory to
          the Company of the loss, theft, destruction or mutilation of this Warrant and,
          in the case of any such loss, theft or destruction of this Warrant, on delivery
          of an indemnity agreement or security reasonably satisfactory in form and amount
          to the Company or, in the case of any such mutilation, on surrender and
          cancellation of this Warrant, the Company at its expense will execute and
          deliver, in lieu thereof, a new Warrant of like tenor. 

      9. Registration
          Rights. The Holder of this Warrant has been granted certain registration
          rights by the Company. These registration rights are set forth in a Registration
          Rights Agreement entered into by the Company and Purchaser of the Company’s
          Convertible Note (the “Note”) at or prior to the issue date of this
          Warrant. 

     10.
          Maximum Exercise. The Holder shall not be entitled to exercise this
          Warrant on an exercise date, in connection with that number of shares of Common
          Stock which would be in excess of the sum of (i) the number of shares of Common
          Stock beneficially owned by the Holder and its affiliates on an exercise date,
          and (ii) the number of shares of Common Stock issuable upon the exercise of this
          Warrant with respect to which the determination of this proviso is being made on
          an exercise date, which would result in beneficial ownership by the Holder and
          its affiliates of more than 4.99% of the outstanding shares of Common Stock of
          the Company on such date. For the purposes of the proviso to the immediately
          preceding sentence, beneficial ownership shall be determined in accordance with
          Section 13(d) of the Securities Exchange Act of 1934, as amended, and Rule 13d-3
          thereunder. Subject to the foregoing, the Holder shall not be limited to
          aggregate exercises which would result in the issuance of more than 4.99%. The
          restriction described in this paragraph may be revoked upon 75 days prior notice
          from the Holder to the Company and is automatically null and void upon an Event
          of Default under the Note. Notwithstanding the foregoing, to the extent required
          by the Nasdaq Marketplace Rules, at no time may the Holder exercise all or part
          of this Warrant to acquire a number of shares of Common Stock that, together
          with any shares of Common Stock acquired upon conversion of all or any part of
          the Note or the interest payable thereon, would in the aggregate exceed 19.99%
          of the outstanding shares of the Company’s Common Stock, determined as of
          the date hereof, without first obtaining stockholder approval of such issuance
          of Common Stock (the “Conversion Limitations”). In obtaining
          stockholder approval, stockholders shall not be entitled to vote shares of
          Common Stock acquired upon exercise of this Warrant and/or conversion of the
          Note on such matter. In the event such approval is so required, then the Company
          shall (i) within fifteen (15) days following notice by the Holder to convert an
          amount in excess of the Conversion Limitations file proxy materials relating to
          such stockholder approval with the Securities and Exchange Commission and (ii)
          use its best efforts to obtain as promptly as possible such stockholder
          approval. 

     11.
          Warrant Agent. The Company may, by written notice to the each holder of
          the Warrant, appoint an agent for the purpose of issuing Common Stock (or Other
          Securities) on the exercise of this Warrant pursuant to Section 1, exchanging
          this Warrant pursuant to Section 7, and replacing this Warrant pursuant to
          Section 8, or any of the foregoing, and thereafter any such issuance, exchange
          or replacement, as the case may be, shall be made at such office by such agent. 

     12.
          Transfer on the Company’s Books. Until this Warrant is transferred
          on the books of the Company, the Company may treat the registered holder hereof
          as the absolute owner hereof for all purposes, notwithstanding any notice to the
          contrary. 13. Notices, etc. All notices and other communications
          from the Company to the Holder of this Warrant shall be mailed by first class
          registered or certified mail, postage prepaid, at such address as may have been
          furnished to the Company in writing by such holder or, until any such Holder
          furnishes to the Company an address, then to, and at the address of, the last
          Holder of this Warrant who has so furnished an address to the Company. 

     14.
          Voluntary Adjustment by the Company. The Company may at any time during
          the term of this Warrant reduce the then current Exercise Price to any amount
          and for any period of time deemed appropriate by the Board of Directors of the
          Company. 

      15. Miscellaneous. This Warrant and any term hereof may
          be changed, waived, discharged or terminated only by an instrument in writing
          signed by the party against which enforcement of such change, waiver, discharge
          or termination is sought. This Warrant shall be governed by and construed in
          accordance with the laws of State of New York without regard to principles of
          conflicts of laws. Any action brought concerning the transactions contemplated
          by this Warrant shall be brought only in the state courts of New York or in the
          federal courts located in the state of New York; provided, however, that the
          Holder may choose to waive this provision and bring an action outside the state
          of New York. The individuals executing this Warrant on behalf of the Company
          agree to submit to the jurisdiction of such courts and waive trial by jury. The
          prevailing party shall be entitled to recover from the other party its
          reasonable attorney’s fees and costs. In the event that any provision of
          this Warrant is invalid or unenforceable under any applicable statute or rule of
          law, then such provision shall be deemed inoperative to the extent that it may
          conflict therewith and shall be deemed modified to conform with such statute or
          rule of law. Any such provision which may prove invalid or unenforceable under
          any law shall not affect the validity or enforceability of any other provision
          of this Warrant. The headings in this Warrant are for purposes of reference
          only, and shall not limit or otherwise affect any of the terms hereof. The
          invalidity or unenforceability of any provision hereof shall in no way affect
          the validity or enforceability of any other provision. The Company acknowledges
          that legal counsel participated in the preparation of this Warrant and,
          therefore, stipulates that the rule of construction that ambiguities are to be
          resolved against the drafting party shall not be applied in the interpretation
          of this Warrant to favor any party against the other party. 

IN WITNESS WHEREOF, the
Company has executed this Warrant under seal as of the date first written above. 

         

            STOCKERYALE, INC. 

By: 
/s/                                                        

Witness: 

  ______________________________________

Exhibit A 

FORM OF SUBSCRIPTION 

(To be signed only on
exercise of Warrant) 

TO: StockerYale, Inc. 

The undersigned, pursuant to the
provisions set forth in the attached Warrant (No.____), hereby irrevocably elects to
purchase (check applicable box): 

___      ________ shares of the Common Stock covered by such Warrant; or

___ the maximum number of shares of
Common Stock covered by such Warrant pursuant to the cashless exercise procedure set forth
in Section 2. 

The undersigned herewith makes
payment of the full Exercise Price for such shares at the price per share provided for in
such Warrant, which is $___________. Such payment takes the form of (check applicable box
or boxes): 

___      $__________ in lawful money of the United States; and/or

___      the cancellation of such portion of the attached Warrant as is exercisable for a total of _______ shares of Common Stock
(using a Fair Market Value of $_______ per share for purposes of this calculation); and/or

___ the cancellation of such number
of shares of Common Stock as is necessary, in accordance with the formula set forth in
Section 2, to exercise this Warrant with respect to the maximum number of shares of Common
Stock purchaseable pursuant to the cashless exercise procedure set forth in Section 2. 

The undersigned requests that the certificates for such shares be issued in the name of, and delivered to  ____________________ whose
address is ______________________________

_________________  

The undersigned represents and
warrants that all offers and sales by the undersigned of the securities issuable upon
exercise of the within Warrant shall be made pursuant to registration of the Common Stock
under the Securities Act of 1933, as amended (the “Securities Act”) or pursuant
to an exemption from registration under the Securities Act. 

Dated:___________________           _______________________________________

	 	
(Signature
must conform to name of holder as specified on the face of the Warrant) 

     
     

(Address) 

Exhibit B 

FORM OF TRANSFEROR
ENDORSEMENT 

(To be signed only on
transfer of Warrant) 

For value received, the undersigned hereby sells, assigns, and transfers unto the person(s)
named below under the heading "Transferees" the right represented by the within Warrant to
purchase the percentage and number of shares of Common Stock of StockerYale, Inc. to which
the within Warrant relates specified under the headings "Percentage Transferred" and "Number Transferred,"
respectively, opposite the name(s) of such person(s) and appoints each such person Attorney to transfer its
respective right on the books of StockerYale, Inc. with full power of substitution in the premises. 

	
    Transferees
     
	
    Percentage Transferred
     
	
    Number Transferred
     

	
    
     
	
    
     
	
    
     

	
    
     
	
    
     
	
    
     

	
    
     
	
    
     
	
    
     

	
    
     
	
    
     
	
    
     

Dated:___________________ ____________________________________________________________________ 

(Signature must conform to name of holder as specified on the face of the Warrant)
 

Signed in the presence of: ______________________________ 

(Name) ______________________________________________

(Address) ____________________________________________ 

(City, State, Zip)_______________________________________

ACCEPTED AND AGREED:
 

[TRANSFEREE] _______________________________________ 

(Name) _______________________________________________ 

(Address) _____________________________________________ 

(City, State, Zip)________________________________________Securities Purchase Agreement

Msftedit
5.41.15.1507;STOCK PURCHASE AGREEMENT 

        STOCK
PURCHASE AGREEMENT (this “Agreement”), dated as of December __, 2004, by
and between StockerYale, Inc., a Massachusetts corporation (the
“Company”), and the investor named on the signature page hereof (the
“Investor”). 

W I T N E S S E T H 

        WHEREAS,
the Company is offering for sale up to 2,500,000 shares (the “Shares”) of
its Common Stock (as defined below) at the price per share of Common Stock negotiated with
each purchaser, pursuant to a Confidential Offering Memorandum dated as of November 29,
2004 (the “Memorandum”), this transaction generally being herein referred
to as the “Private Placement”; and 

        WHEREAS,
the Investor desires to purchase from the Company shares of Common Stock on the terms and
conditions set forth herein. 

        NOW,
THEREFORE, in consideration of the mutual covenants and agreements set forth herein, and
for good and valuable consideration the receipt of which is hereby acknowledged, the
parties agree as follows: 

         1.       
          Definitions. Unless specifically defined herein, capitalized terms used
          herein have the meaning ascribed to such terms in the Memorandum except that,
          unless the context requires otherwise, the following terms have the meanings
          indicated: 

        “Business
Day” shall mean any day except Saturday, Sunday and any day which shall be in
Boston, Massachusetts a legal holiday or a day on which banking institutions are
authorized or required by law or other government action to close. 

        “Common
Stock” shall mean the Common Stock, par value $0.001 per share, of the Company. 

        “Investors”
shall mean all of the purchasers of Shares sold in the Private Placement. 

        “Person”
shall mean any individual, partnership, joint venture, firm, corporation, association,
trust or other enterprise or any government or political subdivision or any agency,
department or instrumentality thereof. 

        “Total
Purchase Price” shall mean the aggregate purchase price for all of the Shares
sold in the Private Placement. 

         2.       
          Purchase of Common Stock. Subject and pursuant to the terms and conditions
          set forth in this Agreement, the Company agrees that it will issue and sell to
          the Investor and the Investor agrees that it will purchase from the Company, at
          $____ per share of Common Stock (the “Per Share Purchase Price”),
          _________shares of Common Stock (the “Investor Shares”). The
          aggregate purchase price for the shares of Common Stock shall be $_________ (the
          “Aggregate Purchase Price”). The shares of Common Stock are
          being offered pursuant to the Memorandum. 

      3.
Deliveries at Closing. 

         (a)       
          Deliveries by the Investor. At the Closing of the transactions contemplated
          hereby, the Investor shall deliver to the Company the following: 

          		    (1)       
               the Aggregate Purchase Price by wire transfer of immediately available funds to
               an account  designated by the Company as set forth on Annex V
               hereto, which funds will be delivered to the Company in consideration of the
               Investor Shares issued at the closing of the transaction contemplated hereby; 

               

          		    (2)       
               an executed Investor Questionnaire in the form attached as Annex I; 

               

          		    (3)       
               an executed Managed Account Representation Letter in the form attached as
               Annex II, if the Investor is acting on behalf of a managed account
               in the purchase of the Investor Shares; and 

               

          		    (4)       
               a completed Registration Statement Questionnaire in the form attached as
               Annex III. 

               

         (b)       
          Deliveries by the Company. At the Closing of the transactions contemplated
          hereby, the Company shall deliver to the Investor one or more certificates
          representing the Investor Shares registered in the name of the Investor or its
          nominee(s), as the Investor has specified in writing to the Company. 

      4.
Representations, Warranties, Covenants and Agreements. 

         (a)       
          Investor Representations, Warranties and Covenants. The Investor represents,
          warrants and agrees as follows: 

          		    (1)       
               The Investor has received and reviewed a copy of the Memorandum, and all
               appendices and  supplements (if any) thereto, relating to the Shares and
               understands that no Person has been authorized to give any  information
               or to make any representations that were not contained in the Memorandum, and
               the Investor has not relied on any  such other information or
               representations in making a decision to purchase the Investor Shares. The
               Investor has had access  to such financial and other information and has
               had the opportunity to ask questions and receive answers as deemed necessary
                in respect of the decision to purchase the Investor Shares, and has
               consulted with its advisors concerning the proposed  investment in the
               Company. The Investor understands that an investment in the Company involves a
               high degree of risk for  the reasons, among others, set forth under the
               caption “Risk Factors” in the Memorandum. 

               

          		    (2)       
               The Investor has decided to invest in the Shares and, in making the decision to
               so invest, is not  in any way relying on the fact that any other Person
               has decided to invest in the Shares. 

               

          		    (3)       
               The Investor represents that the Investor (or, if applicable, each managed
               account on whose behalf  the Investor Shares are being purchased by such
               Investor) is an “accredited investor” as defined in Rule 501 under the
                Securities Act of 1933, as amended (the “Securities Act”),
               as certified by the Investor in the Investor Questionnaire attached hereto as
               Annex I. The Investor further represents that the Investor (or, if
               applicable, each managed account on whose behalf the Investor Shares are being
               purchased) has such knowledge and experience in financial and business matters
               as to be capable of evaluating the merits and risk of an investment in the
               Shares and can bear the economic risk of loss of the entire investment in the
               Shares being purchased. 

               

          		    (4)       
               The Investor understands and expressly acknowledges and agrees that none of the
               Shares has been, or will be, registered or qualified under the Securities Act,
               or under any applicable securities laws of any State of the United States
               (“Applicable State Law”) and therefore may not be offered,
               sold, transferred, assigned, pledged, hypothecated or otherwise disposed of,
               directly or indirectly, unless subsequently registered or qualified under the
               Securities Act and under Applicable State Law or unless an exemption from the
               registration requirements of the Securities Act and Applicable State Law is
               available, in each case to the extent permitted by the terms of this Agreement. 

               

          		    (5)       
               The Investor understands and agrees that all certificates representing the
               Investor Shares shall bear a legend which will be substantially in the form of
               the following: 

               

	 	
“THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”),
OR ANY APPLICABLE STATE SECURITIES OR “BLUE SKY” LAWS (“APPLICABLE STATE
LAW”). THESE SECURITIES MAY NOT BE OFFERED, SOLD, PLEDGED, TRANSFERRED OR
HYPOTHECATED OR OTHERWISE ASSIGNED IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION
FROM REGISTRATION UNDER THE ACT OR APPLICABLE STATE LAW RELATING TO DISPOSITION OF
SECURITIES.” 

          		    (6)       
               The Investor (or, if applicable, each managed account on whose behalf the
               Investor Shares are being purchased by the Investor) will acquire the Investor
               Shares pursuant to this Agreement for its own account for investment and not
               with a view to, or in connection with, the resale or distribution thereof or in
               any arrangement or understanding with any other persons regarding the
               distribution of such Investor Shares. The Investor hereby covenants and agrees
               that, during the six month period following the Closing, the Investor shall
               execute a lockup agreement, containing a restriction on the sale of Investor
               Shares for a period terminating on the earlier of the ninetieth day following
               closing of a primary offering by the Company or the six month anniversary of the
               Closing, and other standard terms and conditions, with any requesting
               underwriter participating in a primary offering (as defined in
               Section 5(a)(1) below). 

               

          		    (7)       
               The Investor hereby covenants and agrees with the Company not to, directly or
               indirectly, sell, offer, contract or grant any option to sell (including without
               limitation any short sale), pledge, transfer, establish a “put equivalent
               position” as such term is defined by Rule 16a-1(h) under the Securities
               Exchange Act of 1934, as amended (the “Exchange Act”), or
               otherwise dispose of any Investor Shares, options or warrants to acquire
               Investor Shares, or securities exchangeable or exercisable for or convertible
               into Investor Shares owned either of record or beneficially (as defined in Rule
               13d-3 under the Exchange Act) by the Investor or publicly announce the
               Investor’s intention to do any of the foregoing or enter into any swap or
               other arrangement that transfers to another, in whole or in part, any of the
               economic benefits or risks of ownership of the Investor Shares, prior to the
               date on which the Registration Statement (as defined in Section 5(a)(2)) is
               declared effective (other than in connection with a sale pursuant to a
               registration statement effected under Section 5(a)(1) hereof). 

               

          		    (8)       
               The Investor hereby covenants and agrees with the Company not to make any sale
               of the Investor Shares without causing the prospectus delivery requirement under
               the Securities Act to be satisfied or otherwise complying with the Securities
               Act, and the Investor acknowledges and agrees that the Investor Shares are not
               transferable on the books of the Company unless the certificate submitted to the
               transfer agent evidencing the Investor Shares is accompanied by (a) a
               separate certificate (i) in the form of Annex V hereto,
               (ii) executed by an officer of, or other authorized person designated by,
               the Investor, and (iii) to the effect that (A) the Investor Shares have
               been sold in accordance with a registration statement pursuant to Section 5
               hereof and (B) the requirement of delivering a current prospectus has been
               satisfied; or (b) an opinion of counsel reasonably satisfactory to the
               Company stating that an exemption from registration is available under the
               Securities Act. The Investor acknowledges and agrees that, notwithstanding
               anything else in this Agreement to the contrary, there may be times when the
               Company may suspend the use of the prospectus forming a part of a registration
               statement (or otherwise render the registration statement unavailable) in the
               event that, and during such period as, pending negotiations relating to, or
               consummation of, a transaction, or the occurrence of any other event, would
               require additional disclosure of material information by the Company in the
               registration statement and the Company determines that disclosing such
               information would (x) adversely affect the Company, (y) make it
               impractical or inadvisable to cause the registration statement to be filed or to
               become effective or to amend or supplement the registration statement or
               (z) otherwise render the Company unable to comply with the requirements of
               the Securities and Exchange Commission (the “Commission”). In
               such event, subject to the last sentence of this Section 4(a)(8), the Company
               may suspend the use of such prospectus until such time as an amendment to such
               registration statement has been filed by the Company and declared effective by
               the Commission, or until such time as the Company has filed an appropriate
               report with the Commission pursuant to the Exchange Act. The Investor hereby
               covenants and agrees that it will not sell any Investor Shares pursuant to said
               prospectus during the period commencing at the time at which the Company gives
               the Investor written notice of the suspension of the use of said prospectus and
               ending the date on which the Company gives the Investor written notice that the
               Investor may thereafter effect sales pursuant to said prospectus. Anything
               herein to the contrary notwithstanding, the Company does not have the right to
               suspend the use of such prospectus for a period of more than sixty (60) business
               days per suspension and the Company may not exercise this right to suspend the
               use of such prospectus more than two times in any twelve month period. 

               

          		    (9)       
               The execution and delivery of this Agreement by the Investor and the performance
               of this Agreement and the consummation by the Investor or the Investor’s
               advisory clients, as the case may be, of the transactions contemplated hereby
               have been duly authorized by all necessary (corporate, in the case of a
               corporation) action of the Investor and, if applicable, the Investor’s
               advisory clients; and this Agreement, when duly executed and delivered by the
               Investor, will constitute a valid and legally binding instrument, enforceable in
               accordance with its terms against the Investor or any of the Investor’s
               advisory clients, as the case may be. 

               

          		    (10)       
               The Investor represents that: 

               

          		    (A)       
               If the Investor is a corporation, it is a corporation duly incorporated, validly
               existing and in good standing under the laws of the jurisdiction of its
               incorporation, with full power and authority (corporate and other) to perform
               its obligations under this Agreement. If the Investor is a limited liability
               company, it is a limited liability company duly organized, validly existing and
               in good standing under the laws of the jurisdiction of its incorporation, with
               full power and authority (limited liability company and other) to perform its
               obligations under this Agreement. If the Investor is any other form of business
               entity, it is duly organized or formed, validly existing and in good standing
               under the laws of its jurisdiction of organization, with full power and
               authority to perform its obligations under this Agreement. 

               

          		    (B)       
               If the Investor is a corporation acting in an advisory capacity, it is a
               corporation duly organized, validly existing and in good standing under the laws
               of the jurisdiction of its incorporation, with full power and authority
               (corporate and other) to act on behalf of its advisory clients under this
               Agreement. If the Investor is a limited liability company acting in an advisory
               capacity, it is a limited liability company duly organized, validly existing and
               in good standing under the laws of the jurisdiction of its incorporation, with
               full power and authority (corporate and other) to act on behalf of its advisory
               clients under this Agreement. 

               

          		    (C)       
               If the Investor is a trust, the trustee thereunder has been duly appointed as
               trustee of such Investor with full power and authority to act on behalf of such
               Investor and to perform the obligations of such Investor under this Agreement.
               Furthermore, the trustee under such trust has independently determined that the
               purchase of the Investor Shares is a suitable investment for such trust as
               authorized by the terms thereof and applicable laws and regulations. 

               

          		    (D)       
               If the Investor is a limited partnership, it is a limited partnership duly
               organized, validly existing and in good standing under the laws of the
               jurisdiction of its organization, with full power and authority to perform its
               obligations under this Agreement. 

               

          		    (E)       
               If the Investor is a limited partnership acting in an advisory capacity, it is a
               limited partnership duly organized, validly existing and in good standing under
               the laws of the jurisdiction of its organization, with full power and authority
               to act on behalf of its advisory clients under this Agreement. 

               

          		    (F)       
               The execution and delivery of this Agreement and the performance by the Investor
               of the transactions contemplated hereby have been duly authorized by all
               necessary corporate or other action of the Investor. 

               

          		    (G)       
               If the Investor is a corporation, limited liability company, partnership, trust
               or other form of business entity, the execution and delivery of this Agreement
               will not contravene or result in a default under any provision of existing law
               or regulations to which the Investor is subject, the provisions of its trust
               instrument, charter, by-laws or other governing documents or any indenture,
               mortgage or other agreement or instrument to which it is a party or by which it
               is bound and does not require on its part any approval, authorization, license
               or filing from or with any foreign, federal, state or municipal board or agency
               which has not been obtained or duly made. 

               

          		    (H)       
               If the Investor is an individual, the Investor has full power and authority to
               perform its obligations under this Agreement. 

               

          		    (11)       
               The Investor agrees to complete and execute and return to the Company
               (a) the Investor Questionnaire attached as Annex I to this Agreement
               representing that the Investor is investing in Shares as an “accredited
               investor;” (b) if the Investor is acting on behalf of a managed
               account in the purchase of any Investor Shares, the Managed Accounts
               Representation Letter attached as Annex II to this Agreement; and (c) the
               Registration Statement Questionnaire attached as Annex III, in each case
               together with an executed signature page to this Agreement. The Investor
               represents and warrants that the answers thereto are true and correct as of the
               date hereof and will be true and correct as of the effective date of the
               Registration Statement (as defined in Section 5). If any of the answers provided
               by the Investor in the questionnaires change prior to the effective date of the
               Registration Statement, the Investor will provide the Company with prompt
               written notice of such changes. The Investor further represents and warrants
               that it is not purchasing the Investor Shares on behalf of any managed account
               other than as listed in the Managed Account Representation Letter. 

               

          		    (12)       
               The Investor has not entered into any contracts, arrangements, understandings or
               relationships (written or otherwise) with any other Person or Persons (other
               than the Company or a limited partner/member or affiliate of Investor, which in
               any case shall not violate any securities laws) with respect to any securities
               of the Company (including but not limited to transfer or voting of any of the
               securities, finder’s fees, joint ventures, loan or option arrangements,
               puts or calls, guarantees of profits, division of profits or loss, or the giving
               or withholding of proxies) or the operations, management or control of the
               Company; the Investor is not bound together, under common control with, in a
               common enterprise with, or otherwise acting in concert with, any other Person or
               Persons (other than a limited partner/member or affiliate of Investor, which in
               any case shall not violate any securities laws) in connection with the
               transactions contemplated by this Agreement; and the Investor does not own any
               securities of the Company which are pledged or otherwise subject to a
               contingency the occurrence of which would give another Person voting power or
               investment power over such securities. 

               

          		    (13)       
               Except as otherwise set forth in Annex III, as of the date hereof, the
               Investor does not beneficially own any shares of Common Stock. 

               

          		    (14)       
               No state, federal or foreign regulatory approvals, permits, licenses or consents
               or other contractual or legal obligations are required for the Investor to enter
               into this Agreement or otherwise purchase the Investor Shares. 

               

          		    (15)       
               The Investor hereby covenants and agrees not to disclose any confidential
               information provided to the Investor by the Company in the Memorandum or
               otherwise in connection with the Private Placement with respect to the Company,
               except as otherwise required by law. 

               

         (b)       
          Company Representations, Warranties and Covenants. The Company hereby
          represents, warrants and agrees as follows: 

          		    (1)       
               The Company has been duly incorporated and is validly existing in good standing
               under the laws of  the jurisdiction of its incorporation, with full power
               and authority (corporate and other) to perform its obligations under 
               this Agreement and to consummate the transactions contemplated hereby. 

               

          		    (2)       
               The execution, delivery and performance of this Agreement by the Company and the
               consummation by  the Company of the transactions contemplated hereby have
               been duly authorized by all necessary action of the Company and the 
               Agreement has been duly executed and delivered by the Company; and this
               Agreement, when duly executed and delivered by the  Investor, will
               constitute a valid and legally binding instrument of the Company enforceable in
               accordance with its terms. 

               

          		    (3)       
               The Investor Shares have been duly authorized by the Company, and when issued
               and delivered by the  Company against payment therefor as contemplated
               hereby and in accordance with the terms of the Memorandum, the Investor 
               Shares will be validly issued, fully paid and nonassessable, free of
               preemptive rights and free from all taxes, liens,  charges and security
               interests in respect of the issuance thereof. 

               

          		    (4)       
               The execution and delivery of this Agreement, the consummation by the Company of
               the transactions  herein contemplated and the compliance by the Company
               with the terms hereof do not and will not (i) violate the Articles of 
               Organization (as amended to date) of the Company, or the By-Laws (as amended
               to date) of the Company, or (ii) result in a  breach or violation of any
               of the terms or provisions of, or constitute a default under, any indenture,
               mortgage, deed of  trust, loan agreement or other agreement or instrument
               to which the Company or any of its subsidiaries is a party or by  which
               the Company or any of its subsidiaries is bound or to which any of their
               properties or assets are subject, or any  applicable statute or any
               order, judgment, decree, rule or regulation of any court or governmental agency
               or body having  jurisdiction over the Company or any of its subsidiaries
               or any of their properties or assets other than a breach or  violation
               that would reasonably be expected to have a material adverse effect on the
               condition (financial or otherwise),  business, assets or results of
               operations of the Company (a “Material Adverse Effect”); and no
               consent, approval, authorization, order, registration or qualification of or
               with any such court or governmental agency or body is required for the valid
               authorization, execution, delivery and performance by the Company of this
               Agreement, the issue of the Investor Shares or the consummation by the Company
               of the other transactions contemplated by this Agreement, except for such
               consents, approvals, authorizations, registrations or qualifications as may be
               required under Federal or state securities or “blue sky” laws or, with
               respect to requirements applicable to the Investor and except where the failure
               to obtain such consents, approvals, authorizations, registrations or
               qualifications would not reasonably be expected to have a Material Adverse
               Effect. 

               

          		    (5)       
               The information contained in the following documents, which the Company has
               furnished to the Investor does not contain any untrue statement of material fact
               or omit to state any material fact necessary in order to make the statements
               therein in light of the circumstances in which they were made not misleading as
               of the respective final dates of the documents. Each of the documents listed in
               (A), (B) and (C) below complied as to form in all material respects with the
               applicable requirements of the Securities Act or Exchange Act as of the date
               filed with the Commission. 

               

          		    (A)       
               the Company’s Annual Report to Stockholders on Form 10-K for the fiscal
               year ended December 31, 2003, as amended (without exhibits); 

               

         (B)       
          the Company’s Quarterly Report on Form 10-Q for the quarter ended
          September 30, 2004; and 

         (C)       
          the Memorandum. 

          		    (6)       
               The balance sheets of the Company for the twelve months ended December 31, 2003
               have been prepared in conformity with generally accepted accounting principles
               applied on a consistent basis, are consistent in all material respects with the
               books and records of the Company and accurately present in all material respects
               the financial position of the Company and its subsidiaries as of December 31,
               2003. There has been no material adverse change in the financial condition or
               business or results of operations of the Company or its subsidiaries since
               December 31, 2003, except as disclosed in the Company’s Quarterly Report on
               Form 10-Q for the quarter ended September 30, 2004 and the Memorandum. 

               

         (c)       
          Survival of Representations, Warranties and Agreements. Notwithstanding
          any investigation made by any party to this Agreement, all covenants,
          agreements, representations and warranties made by the Company and the Investor
          herein and in the certificates for the Investor Shares delivered pursuant hereto
          shall survive the execution of this Agreement, the delivery to the Investor of
          the Investor Shares and the payment therefor. 

         5.       
          Registration of the Shares; Compliance with the Securities Act. 

      (a)
Registration Rights; Registration Procedures and Expenses. 

          		    (1)       
               If at any time or times after the date hereof, the Company shall determine or be
               required to  register any shares of its Common Stock or other equity
               securities for sale under the Securities Act in exchange for cash 
               (whether in connection with a public offering of securities by the Company (a
               “primary offering”), a public offering of securities by
               stockholders of the Company (a “secondary offering”) or both),
               but not in connection with a registration effected solely to implement an
               employee benefit plan or a transaction to which Rule 145 or any other
               similar rule of the Commission under the Securities Act is applicable, the
               Company shall: 

               

          		    (A)       
               Promptly give written notice thereof to each of the Investors. 

               

          		    (B)       
               Use commercially reasonable efforts to effect the registration under the
               Securities Act of all Investor Shares (but not any other shares) which such
               Investors request to be registered in a writing delivered to the Company within
               10 days after such Investors’ receipt of the notice referred to above,
               subject to subparagraph (iii) below. 

               

          		    (C)       
               In the case of the registration of shares of Common Stock by the Company in
               connection with an underwritten public offering, (a) the Company shall not
               be required to include any Investor Shares in such underwriting unless the
               Investors thereof accept the terms of the underwriting as agreed upon between
               the Company and the underwriter or underwriters selected by it, and (b) if
               the underwriter(s) determines that marketing factors require a limitation on the
               number of Investor Shares to be offered, the Company shall not be required to
               register Investor Shares of the Investors in excess of the amount, if any, of
               shares of the capital stock which the principal underwriter of such underwritten
               offering shall reasonably and in good faith agree to include in such offering in
               excess of any amount to be registered for the Company, and in the event of any
               such limitation, the number of Investor Shares of any Investor requesting
               inclusion in such registration shall be based upon the relative holdings of
               Common Stock of all Investors requesting such registration (and if any Investor
               would thus be entitled to include more Investor Shares than such Investor
               requested to be registered, the excess shall be allocated among other requesting
               Investors pro rata based upon their relative holdings of Common
               Stock). All expenses relating to the registration and offering of Investor
               Shares pursuant to this Section 5(a)(1) and pursuant to Section 5(a)(2) below
               shall be borne by the Company, except that the Investors shall bear underwriting
               and selling commissions attributable to their Investor Shares being registered,
               any transfer taxes on shares being sold by such Investors and the costs of any
               counsel or other professional advisors engaged by the Investors. 

               

Notwithstanding the foregoing, the
Company’s obligations pursuant to this Section 5(a)(1) shall be suspended for so
long as the Registration Statement filed pursuant to Section 5(a)(2) is effective. 

         (2)       
          The Company shall: 

          		    (A)       
               Subject to the provisions of subparagraph (B) of this Section 5(a)(2) and
               Sections 5(c) and 5(d) below, use commercially reasonable efforts to prepare and
               file with the Commission within 60 days of the Closing a registration statement
               on Form S-3 under Rule 415 under the Securities Act (the
               “Registration Statement”) to enable the public offering and
               sale of the Investor Shares by the Investor from time to time through the NASDAQ
               National Market, the over-the-counter market or in privately-negotiated
               transactions or otherwise. 

               

          		    (B)       
               The Company shall use commercially reasonable efforts, subject to receipt of
               necessary information from the Investor, to cause the Registration Statement to
               become effective within 120 days after the Closing. 

               

          		    (C)       
               Promptly prepare and file with the Commission such amendments and supplements to
               the Registration Statement and the prospectus used in connection therewith as
               may be necessary to keep the Registration Statement effective for a period not
               exceeding the second anniversary of the Closing, or such shorter period which
               will terminate on the earlier of the date when (i) the Shares held by the
               Investor may be sold without registration under the Securities Act or (ii) all
               of the Shares covered by such Registration Statement have been sold pursuant to
               such Registration Statement or otherwise. 

               

          		    (D)       
               Promptly furnish to the Investor with respect to the Investor Shares registered
               under the Registration Statement (and to each underwriter, if any, of such
               Investor Shares) such number of copies of the Registration Statement and any
               amendment or supplement thereto and of prospectuses and preliminary prospectuses
               in conformity with the requirements of the Securities Act as the Investor shall
               reasonably request. 

               

          		    (E)       
               Promptly file documents required of the Company for customary “blue
               sky” clearance in states specified in writing by the Investor and
               reasonably required by the Investor in order to resell its Investor Shares;
               provided, however, that the Company shall not be required to
               qualify to do business or consent to service of process in any jurisdiction in
               which it is not now so qualified or has not so consented. 

               

          		    (F)       
               Promptly inform the Investor when any stop order by the Commission has been
               issued with respect to the Investor Shares and use commercially reasonable
               efforts to promptly cause such stop order to be withdrawn. 

               

          		    (G)       
               Take such other actions as may reasonably be necessary to effect the
               registration of the resale of the Investor Shares on a registration statement on
               Form S-3 in accordance with the terms of this Agreement and to allow such
               Investor Shares to trade in the same market system or exchange where the
               Company’s Common Stock then trades. 

               

          		    (H)       
               File the reports required to be filed by it under the Securities Act and the
               Exchange Act (or, if the Company is not required to file such reports, it will,
               upon the request of any holder of Investor Shares, make publicly available other
               information so long as necessary to permit sales under Rule 144 under the
               Securities Act), all to the extent required from time to time to enable the
               Investor to sell Investor Shares without registration under the Securities Act
               within the limitations provided by (i) Rule 144 under the Securities Act, as
               such Rule may be amended from time to time, or (ii) any similar rule or
               regulation hereafter adopted by the Commission; provided, however,
               that, except as otherwise expressly provided in this Section 5(a)(2)(H),
               nothing in this Agreement shall require the Company to file reports under the
               Securities Act or the Exchange Act, to register any of its securities under the
               Exchange Act, or to make publicly available any information concerning the
               Company at any time when it is not required by law or by any agreement by which
               it is bound to do any of the foregoing. 

               

A questionnaire related to the
Registration Statement to be completed by the Investor is attached hereto as
Annex IV. 

         (b)       
          Transfer of Shares. The Investor agrees not to effect any disposition of the
          Investor Shares or the right to purchase the Investor Shares that would
          constitute a sale within the meaning of the Securities Act except as
          contemplated in Sections 5(a)(1) and (2) or pursuant to an exemption from
          registration under the Securities Act. The Investor agrees to promptly notify
          the Company of any changes in the information set forth in any registration
          statement regarding the Investor Shares or the Investor. 

         (c)       
          The Investor hereby acknowledges and agrees that in the event that the Company
          makes any filing with the SEC in connection with a primary underwritten offering
          within 30 days following the Closing Date, the time period for preparing and
          filing a Registration Statement as contemplated by Section 5(a)(2) above shall
          be extended until September 23, 2003 and the Company shall use commercially
          reasonable efforts, subject to the receipt of necessary information from the
          Investor, to cause the Registration Statement to become effective as promptly
          thereafter as practicable. 

         (d)       
          Postponement. The Company may postpone the filing or effectiveness of any
          registration statement to be filed pursuant to this Section 5 for a
          reasonable period of time if (i) the Company is engaged in confidential
          negotiations or other confidential business activities, disclosure of which
          would be required in such registration statement and (ii) the Board of
          Directors of the Company determines in good faith that such disclosure would
          have a material adverse effect on any such confidential negotiations or other
          confidential business activities or would be materially detrimental to the
          Company. 

         (e)       
          Indemnification and Contribution. 

         (1)
For the purpose of this Section 5(e): 

          		    (A)       
               The term “Selling Shareholder” shall include the Investor,
               officers, directors, trustees, or any affiliate of such Investor and each
               person, if any, who controls the Selling Shareholder within the meaning of the
               Securities Act and 

               

          		    (B)       
               The term “Registration Statement” shall include (i) the
               Registration Statement and any final prospectus, exhibit, supplement or
               amendment included in or relating to the Registration Statement and
               (ii) any registration statement filed in connection with Section 5(a)(1)
               and any final prospectus, exhibit, supplement or amendment included in or
               relating to such registration statement; and 

               

          		    (2)       
               The Company agrees to indemnify and hold harmless each Selling Shareholder from
               and against any losses, claims, damages or liabilities to which such Selling
               Shareholder may become subject (under the Securities Act or otherwise) insofar
               as such losses, claims, damages or liabilities (or actions or proceedings in
               respect thereof) arise out of, or are based upon any untrue statement or alleged
               untrue statement of a material fact contained in the Registration Statement or
               the omission or alleged omission to state therein a material fact required to be
               stated therein or necessary to make the statements therein not misleading or
               arise out of any failure by the Company to fulfill any undertaking included in
               the Registration Statement and the Company will reimburse such Selling
               Shareholder for any reasonable legal or other expenses reasonably incurred in
               investigating, defending or preparing to defend any such action, proceeding or
               claim, provided, however, that the Company shall not be liable in
               any such case to the extent that such loss, claim, damage or liability arises
               out of, or is based upon, any such untrue statement or omission made in such
               Registration Statement in reliance upon written information furnished to the
               Company by or on behalf of such Selling Shareholder for use in preparation of
               the Registration Statement, or the failure of such Selling Shareholder to comply
               with the covenants and agreements contained in Sections 4(a)(7) and 5(b) hereof
               respecting sale of the Shares or any statement or omission in any prospectus
               that is corrected or made not misleading in any subsequent prospectus that was
               delivered to the Investor prior to the pertinent sale or sales by the Investor.
               The Company will reimburse such Selling Shareholder, as the case may be, for any
               legal or other expenses reasonably incurred in investigating, defending or
               preparing to defend any such action, proceeding or claim. 

               

          		    (3)       
               The Investor agrees to indemnify and hold harmless the Company (and each person,
               if any, who controls the Company within the meaning of Section 15 of the
               Securities Act, each officer of the Company who signs the Registration Statement
               and each director of the Company) from and against any losses, claims, damages
               or liabilities to which the Company (or any such officer, director or
               controlling person) may become subject (under the Securities Act or otherwise),
               insofar as such losses, claims, damages or liabilities (or actions or
               proceedings in respect thereof) arise out of, or are based upon, any failure to
               comply with the covenants and agreements contained in Sections 4(a)(7) and 5(b)
               hereof respecting sale of the Shares, or any untrue statement of a material fact
               contained in the Registration Statement on the effective date thereof if such
               untrue statement was made in reliance upon written information furnished by or
               on behalf of the Investor for use in preparation of the Registration Statement,
               provided, however, that such Investor shall not be liable in any
               such case to the extent that the Investor has furnished in writing to the
               Company information expressly for use in such Registration Statement or any
               amendment thereof or supplement thereto which corrected or made not misleading
               information previously furnished to the Company prior to the filing of the
               Registration Statement, and if furnished to the Company after the filing of the
               Registration Statement, has notified the Company of such information immediately
               upon its occurrence or the Investor’s knowledge of its occurrence. The
               Investor will reimburse the Company (or such officer, director or controlling
               person), as the case may be, for any legal or other expenses reasonably incurred
               in investigating, defending or preparing to defend any such action, proceeding
               or claim. In no event shall the liability of the Investor hereunder be greater
               in amount than the dollar amount of the proceeds received by such Investor (net
               of any underwriting discount) upon the sale of the Shares giving rise to such
               indemnification obligation. 

               

          		    (4)       
               Promptly after receipt by any indemnified person of a notice of a claim or the
               beginning of any action in respect of which indemnity is to be sought against an
               indemnifying person pursuant to this Section 5(e), such indemnified person shall
               notify the indemnifying person in writing of such claim or of the commencement
               of such action, and, subject to the provisions hereinafter stated, in case any
               such action shall be brought against an indemnified person and such indemnifying
               person shall be entitled to participate therein, and, to the extent it shall
               wish, to assume the defense thereof, with counsel reasonably satisfactory to
               such indemnified person. After notice from the indemnifying person to such
               indemnified person of its election to assume the defense thereof, such
               indemnifying person shall not be liable to such indemnified person for any legal
               expenses subsequently incurred by such indemnified person in connection with the
               defense thereof, provided, however, that if there exists or shall
               exist a conflict of interest that would make it inappropriate, in the opinion of
               counsel to the indemnified person, for the same counsel to represent both the
               indemnified person and such indemnifying person or any affiliate or associate
               thereof, the indemnified person shall be entitled to retain its own counsel at
               the expense of such indemnifying person; provided, however, that
               no indemnifying person shall be responsible for the fees and expenses of more
               than one separate counsel for all indemnified parties. The indemnifying party
               shall not be liable for any settlement of any proceeding effected without its
               written consent, but, if settled with such consent or if there be a final
               judgment for the plaintiff, the indemnifying party agrees to indemnify the
               indemnified party or parties in accordance with the provisions of this Section
               5(e). 

               

          		    (5)       
               If the indemnification provided for in this Section 5(e) from the indemnifying
               person is determined by a court of competent jurisdiction to be unavailable to
               an indemnified person hereunder in respect of any losses, claims, damages,
               liabilities or expenses referred to herein, then the indemnifying person, in
               lieu of indemnifying such indemnified person, shall contribute to the amount
               paid or payable by such indemnified person as a result of such losses, claims,
               damages, liabilities or expenses in such proportion as is appropriate to reflect
               the relative fault of the indemnifying person and indemnified persons in
               connection with the actions which resulted in such losses, claims, damages,
               liabilities or expenses, as well as any other relevant equitable considerations.
               The relative fault of such indemnifying person and indemnified persons shall be
               determined by reference to, among other things, whether any action in question,
               including any untrue or alleged untrue statement of a material fact, has been
               made by, or relates to information supplied by, such indemnifying person or
               indemnified persons, and the parties’ relative intent, knowledge, access to
               information and opportunity to correct or prevent such action. The amount paid
               or payable by a party as a result of the losses, claims, damages, liabilities
               and expenses referred to above shall be deemed to include, subject to the
               limitations set forth in this Section 5(e), any reasonable legal or other fees
               or expenses reasonably incurred by such party in connection with any
               investigation or proceeding. 

               

        The
parties hereto agree that it would not be just and equitable if contribution pursuant to
this Section 5(e) were determined by pro rata allocation or by any other method of
allocation which does not take account of the equitable considerations referred to in the
immediately preceding paragraph. Notwithstanding the provisions of this Section 5(e), no
Investor shall be required to contribute any amount in excess of the dollar amount of the
proceeds received by such Investor (net of any underwriting discount) upon the sale of the
Shares giving rise to such contribution obligation. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. 

         (f)       
          Termination of Conditions and Obligations. The conditions precedent imposed
          by Section 4(a)(8) or this Section 5 upon the transferability of the Investor
          Shares shall cease and terminate as to any particular number of the Investor
          Shares when such Investor Shares shall have been effectively registered under
          the Securities Act and sold or otherwise disposed of in accordance with the
          intended method of disposition set forth in the registration statement covering
          such Investor Shares or when such Investor Shares shall have been sold or
          otherwise disposed following receipt by the Company of an opinion of counsel
          satisfactory to the Company stating that an exemption from registration is
          available under the Securities Act to sell or otherwise dispose of such Investor
          Shares. 

         (g)       
          Information Available. So long as a registration statement is effective covering
          the resale of the Investor Shares, the Company will furnish to the Investor: 

          		    (1)       
               As soon as practicable after available (but in the case of the Company’s
               Annual Report to  Shareholders, within one hundred twenty (120) days
               after the end of each fiscal year of the Company), one copy of (i) its 
               Annual Report to Shareholders (which Annual Report shall contain financial
               statements audited in accordance with generally  accepted accounting
               principles by a national firm of certified public accountants), (ii) if not
               included in substance in the  Annual Report to Shareholders, its Annual
               Report on Form 10-K or equivalent form, (iii) its Quarterly Reports to 
               Shareholders, (iv) if not included in substance in its Quarterly Reports to
               Shareholders, its quarterly reports on Form 10-Q  or equivalent form, and
               (v) a full copy of the particular registration statement covering the Shares
               (the foregoing, in each  case, excluding exhibits); and 

               

          		    (2)       
               Upon the reasonable request of the Investor, all exhibits to the reports and
               registration  statement provided to the Investor pursuant to subparagraph
               (1) of this Section 5(g) and all other information that is made 
               available to shareholders; 

               

          		    (3)       
               Upon the reasonable request of the Investor, an adequate number of copies of the
               prospectuses to  supply to any other party requiring such prospectuses; 

               

and the Company, upon the
reasonable request of the Investor, will meet with the Investor or a representative
thereof at the Company’s headquarters to discuss all information relevant for
disclosure in the registration statement covering the Investor Shares and will otherwise
reasonably cooperate with any Investor conducting an investigation for the purpose of
reducing or eliminating such Investor’s exposure to liability under the Securities
Act, including the reasonable production of information at the Company’s
headquarters. 

      6.
Miscellaneous. 

         (a)       
          Remedies. It is understood and agreed that any
          breach of the provisions of this Agreement by either party hereto will result in
          irreparable injury to the other party hereto, that the remedy at law alone will
          be an inadequate remedy for such breach, and that, in addition to any other
          legal or equitable remedies which such party may have, such party may enforce
          its rights by actions for specific performance (to the extent permitted by law). 

         (b)       
          Fees and Expenses. Each of the parties hereto shall be responsible for their own
          expenses incurred in connection with the transactions contemplated hereby. The
          Company shall reimburse the Investor for its reasonable out-of-pocket expenses,
          if any, incurred in connection with the procedures in Section 5(a)(2)(A) through
          (H) hereof, other than fees and expenses, if any, of one counsel or other
          advisors to all of the Investors upon delivery to the Company of reasonable
          documentation setting forth such out-of-pocket expenses. 

         (c)       
          Binding Agreement; Assignment. This Agreement shall be binding upon, and shall
          inure solely to the benefit of, each of the parties hereto, and each of their
          respective heirs, executors, administrators, successors and permitted assigns,
          and no other person shall acquire or have any right under or by virtue of this
          Agreement. The Investor may not assign any of its rights or obligations
          hereunder to any other person or entity without the prior written consent of the
          Company. 

         (d)       
          Entire Agreement. This Agreement constitutes the entire agreement among the
          parties hereto with respect to the subject matter hereof and may be amended only
          by written execution by both parties. By executing this Agreement below, the
          Investor agrees to be bound by all of the terms, provisions, warranties,
          covenants and conditions contained herein. Upon acceptance by the Company, this
          Agreement shall be binding on both parties hereto. 

         (e)       
          Consent To Jurisdiction. THIS AGREEMENT SHALL BE ENFORCED, GOVERNED AND
          CONSTRUED IN ALL RESPECTS IN ACCORDANCE WITH THE LAWS OF THE COMMONWEALTH OF
          MASSACHUSETTS, WITHOUT GIVING EFFECT TO ITS CONFLICTS OF LAWS PRINCIPLES.
          FURTHERMORE, EACH INVESTOR HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE
          COURTS OF THE COMMONWEALTH OF MASSACHUSETTS AND THE UNITED STATES OF AMERICA FOR
          THE DISTRICT OF MASSACHUSETTS IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING
          TO THIS AGREEMENT. 

         (f)       
          Notices. All notices, requests, consents and other communication hereunder shall
          be in writing, shall be mailed by first class registered or certified mail, or
          nationally recognized overnight express courier postage prepaid, and shall be
          deemed given when so mailed and shall be delivered as addressed as follows: 

      if
to the Company, to: 

         StockerYale,
Inc.32 
Hampshire RoadSalem, 
New Hampshire 03079Attn: 
Mark W. Blodgett,  

Chief Executive
Officer 

      with
a copy mailed to: 

         Goodwin
Procter LLPExchange 
PlaceBoston, 
Massachusetts 02109Attn: 
Stuart M. Cable,
P.C. 

or to such other person at such
other place as the Company shall designate to the Investor in writing; and 

if to the Investor, at its address
as set forth at the end of this Agreement, or at such other address or addresses as may
have been furnished to the Company in writing. 

         (g)       
          Counterparts. This Agreement may be executed in any number of counterparts and
          by the parties hereto in separate counterparts, each of which when so executed
          shall be deemed to be an original and all of which taken together shall
          constitute one in the same agreement. 

[Remainder of Page
Intentionally Left Blank] 

        IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date first above
written. 

STOCKERYALE, INC. 

By:  

                                                                     Name:
                                                                     Title:

Accepted and Agreed as of the date
first above written: 

Name of Investor (Print) 

By:
      Name:
      Title

Address:

Telephone:
Facsimile:

Nominee (name in which Investor Shares
are to be registered, if different than name of Investor)  

Address of Nominee: 

Taxpayer I.D. Number:
(if acquired in the name of a nominee, the taxpayer I.D. number of such
nominee)

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00075-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00075-of-00352.parquet"}]]