Document:

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                                                                   Exhibit 10.14

                            CLINICAL SUPPLY AGREEMENT

     This Agreement, dated as of October 5, 2005, is made and entered into by
and between: Light Sciences Oncology, Inc., a Washington corporation ("LSO");
and Light Sciences Corporation, a Washington corporation ("Buyer").

                                    RECITALS

     A. Light Sciences Corporation ("LSC") entered into agreements with certain
third parties under which such third parties have manufactured and supplied to
LSC talaporfin sodium (referred to as LS11) in bulk or finished dosage form.

     B. LSC has assigned to LSO its rights under such manufacturing and supply
agreements and has transferred to LSO approximately 3,500 vials of LS11 in
finished dosage form, and approximately 2.5 kg of bulk LS11.

     C. Buyer has the valid right and license to use, make, have made, sell,
offer to sell, import and otherwise dispose of LS11.

     D. Buyer wishes to acquire from LSO, and LSO wishes to supply to Buyer,
LS11 in finished dosage form manufactured or to be manufactured under third
party agreements for use in clinical studies under the terms and conditions of
this Agreement.

                                    AGREEMENT

     NOW THEREFORE, in consideration of the promises and agreements set forth
herein, the parties agree as follows:

SECTION 1. DEFINITIONS

     Whenever used in this Agreement with initial letters capitalized, the
following terms will have the following specified meanings:

     "BAXTER AGREEMENT" means the Drug Product Development and Clinical Supply
Agreement between LSC and Baxter Pharmaceutical Solutions LLC ("Baxter"), dated
July 9, 2004, as amended from time to time.

     "BULK DRUG" means talaporfin sodium manufactured and supplied by Johnson
Matthey in bulk form under the Johnson Matthey Agreement or by another Third
Party Manufacturer.

     "CLINICAL STUDIES" means animal, preclinical or human clinical studies of
LS11 by Buyer before marketing approval of LS11 by the regulatory authority of
the jurisdiction where the study is conducted.

     "CONFIDENTIAL INFORMATION" means any confidential or proprietary
information of the disclosing party, whether of a scientific, business or other
nature (including, but not limited to, trade secrets, know how and information
relating to the products, research, studies, technology, inventions, suppliers,
contracts, manufacturing methods, investigators, personnel, business plans,
finances or

CLINICAL SUPPLY AGREEMENT

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scientific, regulatory, legal or other affairs of such party);
provided, that the same is marked or otherwise identified as confidential or
proprietary information prior to, upon or promptly after receipt by the
receiving party. However, Confidential Information does not include any
information that: (a) was known by the receiving party prior to communication by
the disclosing party; (b) is a matter of public knowledge at the time of such
disclosure by the disclosing party; (c) becomes a matter of public knowledge,
without fault on the part of the receiving party, subsequent to disclosure by
the disclosing party to the receiving party; or (d) has been disclosed to the
receiving party from a third party lawfully having possession of such
Confidential Information without an obligation of confidentiality to the
disclosing party. Subparagraph (a) will not apply to Confidential Information
assigned or transferred to LSO by LSC on or before the date of this Agreement.

     "DRUG PRODUCT" means an investigational pharmaceutical product containing
the Bulk Drug as the active pharmaceutical ingredient manufactured and supplied
in finished dosage form by Baxter under the Baxter Agreement or by another Third
Party Manufacturer.

     "FIELD" has the meaning set forth in the Recitals.

     "JOHNSON MATTHEY AGREEMENT" means the Research and Manufacturing Agreement
between LSC and Johnson Matthey Pharmaceutical Materials, Inc. d/b/a Pharm-Eco
("Johnson Matthey"), dated May 7, 2004, as amended from time to time.

     "TERM" has the meaning set forth in Section 5.1.

     "THIRD PARTY MANUFACTURER" means Baxter, Johnson Matthey or any other third
party LSO engages to supply raw material for LS11 or to manufacture and supply
LS11 in bulk or finished dosage form, or any successor to such entity's rights,
obligations or interests under the applicable Third Party Supply Agreement.

     "THIRD PARTY SUPPLY AGREEMENTS" means the Baxter Agreement, the Johnson
Matthey Agreement and any other agreements under which LSO engages a Third Party
Manufacturer to supply raw material for LS11 or to manufacture and supply LS11
in bulk or finished dosage form.

SECTION 2. CLINICAL SUPPLY OF DRUG PRODUCT

     2.1  OBLIGATION OF LSO TO SUPPLY

     LSO will use commercially reasonable efforts to supply to Buyer such
quantities of Drug Product as Buyer may order from LSO during the Term; provided
such quantities do not exceed the quantities set forth in Buyer's most recent
forecast under Section 3.2 and can be supplied from LSO's then available
inventory of Drug Product or by a Third Party Manufacturer under a Third Party
Supply Agreement. Buyer acknowledges that LSO will supply itself and third
parties with Drug Product from its existing inventory, and that LSO is not
obligated to maintain its existing inventory of Bulk Drug or Drug Product, or
reserve inventory for Buyer, or enter into additional manufacturing and supply
agreements. In the event of a shortage of available Drug Product, LSO will
allocate the available Drug Product. Upon reasonable request, LSO will furnish
to Buyer a current inventory of Drug Product being manufactured for LSO and in
LSO's possession or control.

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     2.2  SUBMISSION OF ORDERS TO THIRD PARTY MANUFACTURERS

     If the quantity of Drug Product ordered by Buyer under Section 2.1 exceeds
LSO's then available inventory, LSO will notify Buyer, and, upon Buyer's
request, LSO will submit a firm order for Drug Product with a Third Party
Manufacturer, and, if necessary, will also submit firm orders with other Third
Party Manufacturers for quantities of raw material and Bulk Drug needed to
manufacture the requested Drug Product. Any orders submitted to a Third Party
Manufacturer are subject to acceptance by the Third Party Manufacturer and the
terms and conditions of the applicable Third Party Supply Agreement, including,
without limitation, minimum quantities. Further, if the Third Party Manufacturer
requires an advance payment before accepting the order or milestone or other
progress payments, Buyer will pay to LSO the full amount of the advance payment
before LSO submits the order to the Third Party Manufacturer and any milestone
or other progress payments as they become due to the applicable Third Party
Manufacturer. If the Third Party Manufacturers capable of supplying the
requested raw material, Bulk Drug or Drug Product, as the case may be, reject
LSO's order or are not able to supply the requested materials on terms
acceptable to LSO and Buyer, then LSO will have no further obligations with
respect to the supply of Drug Product that exceeds LSO's then available
inventory.

     2.3  USE OF DRUG PRODUCT FOR CLINICAL STUDIES

     Buyer will purchase, and LSO will supply to Buyer, Drug Product under this
Agreement solely for use in Clinical Studies in the Field. Buyer will not use
Drug Product acquired under this Agreement other than to conduct Clinical
Studies in the Field, and Buyer will comply with all restrictions on use and
other requirements set forth in the applicable Third Party Manufacturer
Agreements.

     2.4  ALTERNATE SOURCE OF SUPPLY

     Promptly after the date of this Agreement, or three (3) years before the
projected date of Buyer's first commercial sale of LS11 drug product, whichever
occurs last, Buyer will undertake commercially reasonable efforts to identify,
qualify and enter into agreements with one or more third parties for the
manufacture and supply of LS11 drug product. LSO will reasonably cooperate with
Buyer to establish such alternate sources of supply and transition supply of
drug product from LSO to such third parties, including, without limitation,
furnishing available technical assistance and documentation. Buyer will pay LSO
its then current FTE rates for such assistance and reimburse LSO all reasonable
travel and other out-of-pocket expenses incurred in connection therewith.

     2.5  PROCESS IMPROVEMENTS

     Subject to LSO's obligations to third parties and provided LSO has
sufficient rights, LSO will grant to Buyer a non-transferable, non-exclusive
license to use any improvements to the Drug Product manufacturing process
developed or made by or for LSO during the Term for the sole purpose of
manufacturing talaporfin sodium drug product. The license granted under this
Section 2.5 includes the right to sublicense under a written sublicense
agreement reasonably acceptable to LSO for the sole purpose of having talaporfin
sodium manufactured by a third party for Buyer.

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SECTION 3. TERMS AND CONDITIONS OF SALE

     3.1  ORDERS

     Buyer will complete, sign and submit to LSO a written order specifying the
quantity of Drug Product that Buyer wishes to purchase, the desired dose per
vial, desired delivery date and any specific requested shipping instructions.
Buyer will order Drug Product in the minimum quantities specified in EXHIBIT A.
All orders will be subject to acceptance by LSO and consistent with the terms of
this Agreement and the applicable Third Party Supply Agreements.

     3.2  FORECASTS

     Promptly after signing this Agreement and thereafter on the first business
day of each calendar quarter during the Term, Buyer will provide LSO with a
three (3) month rolling forecast of Buyer's reasonable estimate of the
quantities of Drug Product that Buyer will need and order in each quarter
covered by the forecast. Such estimates are estimates only and not binding on
Buyer or LSO.

     3.3  FIRM ORDERS

     The quantities set forth in an order submitted by Buyer and accepted by LSO
will be binding on Buyer, and Buyer will be obligated to purchase from LSO the
quantity of Drug Product set forth in the accepted order. Buyer may not cancel
any such order or reduce the quantities or delay shipment of any Drug Product
thereunder. Without limiting any other remedies, Buyer will reimburse LSO for
all cancellation and other charges incurred as a result of Buyer's breach of
this Section 3.3.

     3.4  DELIVERY

     LSO will deliver all Drug Product to Buyer FOB at LSO's facility or LSO's
inventory or storage location. Title to and risk of loss for the Drug Product
will pass to Buyer when the Drug Product has been tendered to the carrier
selected by Buyer at the place of delivery. Buyer will procure, at its own cost,
insurance covering damage or loss of the Drug Product during shipment from the
place of delivery to Buyer's shipping destination. Buyer is responsible for all
transportation costs incurred in shipping the Drug Product from the delivery
location to the shipping destination. Buyer will be responsible for any claims
against the carrier arising from or relating to shipment.

     3.5  INSPECTION AND ACCEPTANCE

     Buyer will inspect and test samples of the Drug Product promptly after
receipt of the Drug Product to determine whether the Drug Product conforms to
the applicable Third Party Manufacturers' warranties. If the Drug Product fails
to conform to any applicable Third Party Manufacturer's warranty, then Buyer
will notify LSO within thirty (30) days after receipt of the Drug Product. In
such event, LSO will notify the applicable Third Party Manufacturer and use
commercially reasonable efforts to exercise any remedies available under the
applicable Third Party Supply Agreement at Buyer's expense. If LSO and the
applicable Third Party Manufacturer determine in good faith that the Drug
Product conforms to the Third Party Manufacturer's warranty, then Buyer will be
deemed to have accepted the Drug Product unless the Drug Product fails to
conform to the Third Party Manufacturer's warranty as a direct result of LSO's
gross negligence or intentional misconduct in handling or storing the Drug
Product or related Bulk Drug or raw material,

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in which case, Buyer's sole remedy will be to exercise its rights under Section
7.1. If Buyer fails to notify LSO of any nonconformance within thirty (30) days
after receipt of the Drug Product, then Buyer will be deemed to have accepted
the Drug Product. Upon LSO's request, Buyer will return any nonconforming Drug
Product to LSO or the applicable Third Party Manufacturer or destroy such Drug
Product in accordance with LSO's instructions.

     3.6  CONFLICTING TERMS

     In the event of any conflict or inconsistency between this Agreement and
any order, the provisions of this Agreement will govern and control. LSO will
not be bound by any term, condition or other provision that is different from or
in addition to the provisions of this Agreement (whether or not it would
materially alter this Agreement) that is proffered by Buyer in any receipt,
acceptance, confirmation, correspondence or otherwise, unless LSO specifically
agrees to such provision in writing.

SECTION 4. COMPENSATION

     4.1  FEES

          4.1.1 EXISTING DRUG PRODUCT

     As full consideration for Drug Product supplied to Buyer from LSO's
inventory of Drug Product existing as of the date of this Agreement, Buyer will
pay LSO a reasonable handling fee. Such handling fee will include compensation
for costs incurred by LSO to store, transport, insure, maintain records related
to and otherwise handle such Drug Product.

          4.1.2 NEW DRUG PRODUCT

     The purchase price for Drug Product supplied to Buyer under this Agreement
pursuant to orders submitted to Third Party Manufacturers after the date of this
Agreement will be equal to the total cost incurred by LSO to have such Drug
Product developed, manufactured and delivered to LSO and to inspect, test,
insure and store such Drug Product and associated raw material and Bulk Drug.
Such cost will include, without limitation, (i) fees, charges, expenses, taxes
and other amounts paid to the Third Party Manufacturers for the development,
capacity reservation, manufacture, testing, packaging and delivery of the Drug
Product, Bulk Drug and raw material and related validation and quality control
lots; and (ii) reasonable overhead charges of LSO (including, without
limitation, fully loaded personnel costs) associated with any of the foregoing
(including, without limitation, related record keeping and regulatory
compliance), as determined by LSO in accordance with LSO's accounting standards
consistently applied. Any advance or progress payments made by Buyer pursuant to
Section 2.2 or required under Section 4.5 will be deducted from the amounts
payable under this Section 4.1.

     4.2  INVOICE; PAYMENT

     LSO will issue invoices to Buyer for the amounts payable under Section 4.1
within thirty (30) days after delivery of the Drug Product. Buyer will pay the
amount set forth in each invoice within thirty (30) days after receipt of such
invoice. All payments made under this Agreement will be made in United States
currency. Any amounts not paid by Buyer under this Agreement when due

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will bear interest from the date due until paid in full at the rate of the
lesser of (a) 1.5% per month compounded monthly, and (b) the highest rate
permitted by applicable usury law.

     4.3  TAXES

     The amounts payable under this Agreement do not include any taxes, duties
and other similar fees assessed by any government authority ("Taxes"). If and to
the extent that any Taxes are due in connection with the supply of the Drug
Product to Buyer under this Agreement (other than Taxes based on LSO's net
income or gross receipts), Buyer will pay such Taxes. If LSO is obligated by
applicable law or regulation to collect and remit any Taxes due in connection
with the supply of the Drug Product, then LSO will add the appropriate amount to
the applicable invoice as a separate line item.

     4.4  EXAMINATION OF RECORDS

     Upon request of Buyer not more frequently than once per calendar year, LSO
will permit an independent certified public accounting firm of national stature
selected by Buyer and reasonably acceptable to LSO, to examine LSO's books of
account and records to verify the amounts payable under this Agreement. Any such
accountant will enter into a confidentiality agreement with LSO reasonably
acceptable to LSO. The findings and results of the examination will be deemed
the Confidential Information of LSO, and neither the accountant nor Buyer will
disclose the results of the examination to any third party without the prior
written consent of LSO. Such examination will be made at reasonable times during
regular business hours and upon at least thirty (30) days' prior notice. The
accountant will report the findings and results of its examination to both LSO
and Buyer, and LSO will have the opportunity to meet with and discuss the
results with the accountant and to review the accountant's work papers.

     4.5  DEFAULT IN PAYMENT OBLIGATIONS

     Without limiting any other remedies, if Buyer fails to make any payment as
and when required under this Agreement, LSO may suspend deliveries of Drug
Product until Buyer has cured such default. In addition, LSO may modify the
payment terms to require full or partial payment in advance of future orders
and/or establish other credit terms.

SECTION 5. TERM AND TERMINATION

     5.1  TERM

     The term of this Agreement will commence as of the date of this Agreement
and, unless sooner terminated pursuant to Section 5.2, 5.3, 5.4 or 9.8, will
terminate on the third (3rd) anniversary of the date of this Agreement (the
"Term").

     5.2  MATERIAL BREACH

     Either party may terminate the Term immediately by giving the other party
written notice of termination if the other party fails to cure any material
breach of or default under this Agreement (including, without limitation,
failure to pay any amounts when due) within thirty (30) days after the other
party receives written notice of the breach or default or such later date as the
terminating party may specify in its notice.

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     5.3  TERMINATION OF SUPPLY AGREEMENTS

     LSO may terminate the Term upon written notice in the event of the
termination or expiration of any Third Party Supply Agreement needed to supply
Drug Product under this Agreement for any reason after LSO has exhausted its
inventory of usable Drug Product.

     5.4  CHANGE IN BUSINESS

     Either party may terminate the Term immediately upon written notice to the
other party if the other party: (a) ceases to do business in the ordinary course
except in connection with a permitted assignment under Section 9.4; (b) is the
subject of any proceeding related to its bankruptcy, liquidation or insolvency
(whether voluntary or involuntary) that is not dismissed within thirty (30)
calendar days after filing; or (c) makes an assignment of all or substantially
all of its assets for the benefit of creditors.

     5.5  EFFECT OF TERMINATION

     Upon termination or expiration of the Term, the following will apply:

          (a) each party will fulfill its obligations under any and all orders
that have been submitted by Buyer and accepted by LSO before the date of
termination or expiration; provided, however, that, in the event of any
termination by LSO pursuant to Section 5.2, 5.3, 5.4 or 9.8, LSO may, at its
option, cancel any outstanding orders upon written notice;

          (b) if LSO terminates the Term pursuant to Section 5.2, 5.3 or 5.4 and
elects to cancel any outstanding orders under (a) above, then Buyer will pay LSO
within thirty (30) days after the effective date of termination, all amounts
that would have become payable under Section 4.1 for Drug Product covered by the
canceled orders, including, without limitation, cancellation fees payable to any
Third Party Manufacturer, except to the extent that such costs can be reasonably
avoided by LSO without incurring additional liability;

          (c) termination or expiration of the Term for any reason will not
relieve either party of any obligation accruing prior thereto; and

          (d) Sections 2.3, 3.3, 3.5, 3.6, 4, 5.5, 6, 7, 8 and 9 and any other
provisions of this Agreement that may reasonably be interpreted or construed to
survive termination or expiration of the Term will survive termination or
expiration of the Term.

SECTION 6. REGULATORY DOCUMENTATION AND MATTERS

     6.1  ADVERSE EFFECTS

     Each party will promptly advise the other of information it receives
relating to the safety or toxicity of the Drug Product, including, without
limitation, any adverse events associated with the use of the Drug Product. For
serious or significant adverse events or reactions, notice must be given by
telephone within two (2) business days after receipt of the information and
followed by written notice not less than five (5) days thereafter. Each party,
as required by applicable laws or regulations, will maintain all adverse event
files associated with its use of the Drug Product. Each party will be
responsible for the review of adverse events associated with its use of the Drug
Product

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and for reporting such events to the United States Food and Drug Administration
and any other applicable regulatory authorities. Buyer will send to LSO all
adverse event reports that require investigation of the manufacture of the Drug
Product, and LSO will request that the applicable Third Party Manufacturer
conduct an investigation and promptly report its findings to LSO and Buyer. Upon
request of LSO or a Third Party Manufacturer, Buyer will provide to LSO samples
of the Drug Product subject to any such report.

     6.2  ACCESS TO DOCUMENTATION

     Promptly after request, LSO will furnish Buyer with all certificates, data,
documentation, reports and records associated with the manufacture of the Drug
Product reasonably necessary for Buyer to comply with regulatory requirements or
obtain regulatory approvals related to the Drug Product to the extent such
information is available and can be furnished to Buyer without breach of LSO's
confidentiality or other obligations. If such disclosure would result in a
breach of LSO's confidentiality or other obligations to a third party, then LSO
will use good faith efforts to obtain permission from the applicable third party
to disclose such information to Buyer. In addition, if LSO has the right to
cross reference any regulatory filings or registrations of a third party that
pertain to Buyer's use of the Drug Product in the Field, then LSO will use
reasonable efforts to obtain permission for Buyer to cross reference such
filings or registrations. All information disclosed to or learned by Buyer under
this Section 6.2 will be treated as Confidential Information of LSO and the
applicable third party, and Buyer will comply with any restrictions on use or
disclosure established by the third party.

     6.3  RECALLS

     If LSO is required or requested by any governmental authority to recall any
Drug Product supplied hereunder, or LSO otherwise determines that any Drug
Product supplied to Buyer hereunder should be recalled, LSO will promptly notify
Buyer of the Drug Product subject to the recall and Buyer will cooperate with
LSO in implementing the recall in accordance with LSO's instructions. Buyer will
be responsible for the costs incurred in recalling any Drug Product supplied to
Buyer hereunder except to the extent (a) such costs are recovered from a Third
Party Manufacturer, or (b) the recall is a direct result of the gross negligence
or intentional misconduct of LSO.

     6.4  COMPLIANCE WITH LAWS

     Buyer will comply with all applicable laws, regulations, rules, orders,
guidelines and other requirements, now or hereafter in effect, of any
governmental authority having jurisdiction ("Applicable Law") in its use,
possession, storage, distribution and other disposition of the Drug Product.
Without limiting the foregoing, if Buyer ships the Drug Product outside the
United States, Buyer will comply with all applicable United States export laws
and regulations and all applicable import laws and regulations of the country of
importation. LSO will have no obligation to obtain approvals, consents, licenses
or permits from any governmental authority relating to the use, possession,
storage, distribution or other disposition of the Drug Product by Buyer.

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SECTION 7. DISCLAIMER OF WARRANTIES AND INDEMNIFICATION

     7.1  PRODUCT DEFECTS

     Buyer acknowledges and agrees that the Third Party Manufacturers and not
LSO are responsible for manufacturing and supplying raw material, Bulk Drug and
Drug Product in compliance with their applicable warranties and Applicable Laws.
Buyer's sole and exclusive remedy with respect to any defect with the Drug
Product or failure of the Drug Product to comply with the Third Party
Manufacturers' applicable warranties or to be manufactured in accordance with
Applicable Law will be limited to whatever recourse Buyer may have against the
applicable Third Party Manufacturer, unless the failure to comply results
directly from the gross negligence or intentional misconduct of LSO in handling
or storing the Drug Product or associated Bulk Drug or raw material after
delivery to LSO by the applicable Third Party Manufacturer. If Buyer determines
that the Drug Product fails to conform with a Third Party Manufacturer's
warranty, Buyer will promptly notify LSO within the applicable warranty period,
and LSO will reasonably assist Buyer in good faith to exercise any rights and
remedies available under the applicable Third Party Supply Agreement at Buyer's
expense. However, if the failure of the Drug Product to comply with a Third
Party Manufacturer's warranty results directly from the gross negligence or
intentional misconduct of LSO in handling or storing the Drug Product or
associated Bulk Drug or raw material after delivery to LSO by the applicable
Third Party Manufacturer, then LSO will replace the Drug Product, or, if LSO
cannot replace the Drug Product within a reasonable period of time (e.g., one
hundred twenty (120) days), LSO will cancel the order and refund any amounts
paid by Buyer for the defective Drug Product promptly after return or
destruction of the Drug Product as stated below. The foregoing constitutes LSO's
sole obligation and Buyer's sole and exclusive remedy against LSO with respect
to defective or nonconforming Drug Product. Buyer will return or destroy, at
LSO's option, any Drug Product that fails to conform to a Third Party
Manufacturer's warranty or which is otherwise defective.

     7.2  DISCLAIMER OF WARRANTIES AND CLAIMS

     LSO DISCLAIMS, AND BUYER WAIVES AND RELEASES LSO AND ITS AFFILIATES FROM,
ALL WARRANTIES, EXPRESS OR IMPLIED, OF ANY KIND ARISING BY LAW OR OTHERWISE,
WITH RESPECT TO THE RAW MATERIAL, BULK DRUG, AND DRUG PRODUCT, INCLUDING, BUT
NOT LIMITED, TO ANY: (A) IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE OR USE; (B) IMPLIED WARRANTY ARISING FROM COURSE OF
PERFORMANCE, COURSE OF DEALING, OR USAGE OF TRADE; AND (C) WARRANTY OF
NONINFRINGEMENT. WITHOUT LIMITING THE FOREGOING AND EXCEPT TO THE EXTENT
INCONSISTENT WITH LSO'S OBLIGATIONS UNDER SECTION 7.1, BUYER WAIVES AND RELEASES
LSO AND ITS AFFILIATES FROM ALL CLAIMS, LOSSES AND DAMAGES RELATING TO THE RAW
MATERIAL, BULK DRUG AND DRUG PRODUCT, INCLUDING, WITHOUT LIMITATION, CLAIMS
RELATING TO STABILITY, EFFICACY, SAFETY, TOXICITY OR NONCONFORMANCE.

     7.3  INDEMNIFICATION

     Buyer will defend, indemnify and hold harmless LSO and its affiliates from
and against any and all claims, costs, losses, damages, fines, penalties and
expenses (including, without limitation,

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reasonable attorneys' fees and costs) arising out of or in connection with any
actual or alleged third party claims resulting from

          (a) any breach of any term or condition of this Agreement or any Third
     Party Supply Agreement by Buyer; and

          (b) Buyer's possession, storage, handling, distribution, use, sale or
     other disposition of the Drug Product after delivery to Buyer, except to
     the extent (i) inconsistent with LSO's obligation to replace Drug Product
     under Section 7.1, or (ii) a Third Party Manufacturer indemnifies, defends
     and holds harmless LSO from such claim.

     LSO will promptly notify Buyer in writing of any such claim, permit Buyer
to control the defense and settlement of such claim, and cooperate with Buyer
(at the sole cost and expense of Buyer) in the defense and settlement of such
claim; provided, that Buyer will not settle any such claim without the prior
written consent of LSO (which consent will not be unreasonably withheld). LSO
will have the right, but not the obligation, to be represented in such defense
by counsel of its own selection and at its own expense.

     7.4  INSURANCE

     Subject to any additional requirements of any Third Party Manufacturer,
Buyer will procure from financially strong insurance carriers (e.g., AM Best
Rating of "A-V" or higher) and maintain during the Term and for a period of
three (3) years thereafter, at its own cost, the following insurance:

     (a) Commercial General Liability: including coverage for products and
completed operations and contractual liability (including coverage for
advertising and personal injury) with a combined single limit of no less than
ten million dollars ($10,000,000);

     (b) Clinical Trials Liability: including coverage for bodily injury and/or
property damage resulting from use of the Drug Product in Clinical Studies with
a combined single limit of no less than ten million dollars ($10,000,000); and

     (c) Foreign Local Coverage: where required by law, foreign local coverages
in an amount that, at a minimum, satisfies the legal requirements of that
jurisdiction.

LSO will be named as an additional insured on such policies, and Buyer will
deliver a certificate of insurance evidencing such coverage and endorsement of
additional insured to LSO within thirty (30) days after the date of this
Agreement and on each anniversary of the date of this Agreement. If Buyer fails
to furnish such certificates or endorsements, or if at any time during the Term
LSO is notified of the cancellation or lapse of any such coverage, in addition
to all other remedies available to LSO, LSO, at its option, may obtain such
coverage and Buyer will promptly reimburse LSO for the cost of the same.
Further, without limiting any other remedies available to LSO, if Buyer fails to
maintain the insurance required hereunder or furnish the required evidence of
insurance, LSO may suspend deliveries of Drug Product until Buyer has cured such
default.

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SECTION 8. LIMITATIONS OF LIABILITY

     8.1  NO CONSEQUENTIAL DAMAGES

     NEITHER PARTY WILL BE LIABLE TO THE OTHER PARTY, WHETHER IN CONTRACT,
WARRANTY, TORT (INCLUDING NEGLIGENCE, PRODUCT LIABILITY OR STRICT LIABILITY) OR
OTHERWISE FOR ANY INDIRECT, INCIDENTAL, SPECIAL, EXEMPLARY, PUNITIVE OR
CONSEQUENTIAL DAMAGES (INCLUDING, BUT NOT NECESSARILY LIMITED TO, LOSS OF
PROFIT, REVENUE OR USE) ARISING OUT OF THIS AGREEMENT OR THE USE OR INABILITY TO
USE ANY DRUG PRODUCT.

     8.2  DOLLAR LIMITATION

     A PARTY'S TOTAL LIABILITY, WHETHER IN CONTRACT, WARRANTY, TORT OR OTHERWISE
WITH REGARD TO THIS AGREEMENT WILL NOT IN THE AGGREGATE EXCEED THE TOTAL AMOUNT
OF COMPENSATION PAID BY BUYER TO LSO UNDER THIS AGREEMENT AND TO BE PAID BY
BUYER TO LSO UNDER ORDERS ACCEPTED UNDER THIS AGREEMENT.

     8.3  EXCEPTIONS

     THE LIMITATIONS SET FORTH IN SECTIONS 8.1 AND 8.2 WILL NOT APPLY TO (A)
BUYER'S INDEMNIFICATION OBLIGATIONS HEREUNDER, (B) ANY DAMAGE, LIABILITY OR
OBLIGATION ARISING UNDER SECTION 9.2, OR (C) AMOUNTS OWED BY BUYER TO LSO UNDER
THIS AGREEMENT.

SECTION 9. MISCELLANEOUS

     9.1  NO LICENSES GRANTED

     Except as expressly granted herein, nothing in this Agreement or its
performance grants, by implication, estoppel or otherwise, either party any
right, title, interest, or license, in or to the other party's intellectual
property or under the other party's intellectual property rights. Each party
reserves all rights not expressly granted herein.

     9.2  CONFIDENTIAL INFORMATION

     Each party reserves any and all right, title and interest (including,
without limitation, any intellectual property rights) that it may have in or to
any Confidential Information that it may disclose to the other party or that the
other party may acquire under this Agreement. The recipient will exercise due
care (i.e., at least as much care as it affords its own confidential
information) to prevent unauthorized disclosure or use of Confidential
Information of the disclosing party. The recipient will use any Confidential
Information of the discloser solely for the purposes for which it is provided by
the discloser. This Section 9.2 will not be interpreted or construed to
prohibit: (a) any use or disclosure necessary or appropriate in connection with
the recipient's performance of its obligations or exercise of its rights under
this Agreement; (b) any use or disclosure required by applicable law (e.g.,
pursuant to applicable securities laws or legal process); provided, that the
recipient uses reasonable efforts to give the discloser reasonable advance
notice thereof (e.g., so as to afford the discloser an opportunity to intervene
and seek an order or other appropriate relief for the

                                      -11

<PAGE>

protection of its Confidential Information from any unauthorized use or
disclosure ); or (c) any use or disclosure made with the written consent of the
discloser. In the event of any breach or threatened breach by the recipient of
its obligations under this Section 9.2, the discloser will be entitled to
injunctive and other equitable relief to enforce such obligations.

     9.3  EXCUSED PERFORMANCE

     Neither party will be liable for, or be considered to be in breach of or
default under this Agreement on account of, any delay or failure to perform as
required by this Agreement as a result of any cause or condition beyond such
party's reasonable control (excluding payment obligations).

     9.4  ASSIGNMENT

     Neither party will assign this Agreement, in whole or in part, directly, by
operation of law or otherwise, except with the prior written consent of the
other party. However, each party hereby consents to any assignment of the other
party's right, title and interest under this Agreement to a successor by virtue
of any merger, consolidation or other corporate reorganization or any sale of
substantially all the assets of the business of the other party to which this
Agreement pertains, or to an affiliate that is controlled by, controls or is
under common control with the assigning party; provided, that such successor,
affiliate or assignee signs a document assuming all the obligations of the
assigning party under this Agreement and agreeing to comply with the terms set
forth in this Agreement and that a copy of such document is provided to the
non-assigning party. No assignment by a party, with or without the other party's
consent, will relieve such party from any of its obligations under this
Agreement. Subject to the foregoing restrictions, this Agreement will be fully
binding upon, inure to the benefit of and be enforceable by the parties and
their respective successors and assigns.

     9.5  NOTICE

     All notices and other communications hereunder will be in writing and will
be deemed given if delivered personally, by fax (receipt confirmed), or by
registered or certified mail, return receipt requested and postage prepaid or
sent by express courier service (receipt verified), to the party at the address
specified on the signature page of this Agreement (or at such other addresses
for a party as will be specified by the like notice; provided, that notices of a
change of address will be effective only upon receipt thereof). All such notices
and communications will be deemed effective when received.

     9.6  INDEPENDENT CONTRACTOR

     Each party is engaged in an independent business and will perform its
obligations under this Agreement as an independent contractor and not as an
agent or representative of any other party. Neither party will have any right or
authority to create any obligation or make any representation or warranty in the
name or on behalf of the other party. This Agreement will not be interpreted or
construed to create an association, joint venture or partnership between the
parties or to impose any partnership obligation or liability upon any party.

                                      -12

<PAGE>

     9.7  NONWAIVER

     The failure of either party to insist upon or enforce strict performance of
any of the provisions of this Agreement or to exercise any rights or remedies
under this Agreement will not be construed as a waiver or relinquishment to any
extent of such party's right to assert or rely upon any such provisions, rights
or remedies in that or any other instance; rather, the same will be and remain
in full force and effect.

     9.8  SEVERABILITY

     The invalidity or unenforceability of any provision of this Agreement will
not affect the other provisions hereof, and this Agreement will be construed in
all respects as if such invalid or unenforceable provision were replaced with a
valid and enforceable provision as similar as possible to the one replaced;
provided, that, if any part of Section 7 is found unenforceable or invalid by a
court of competent jurisdiction, LSO will have the right to terminate the Term
and cancel any outstanding orders upon written notice.

     9.9  CONSTRUCTION

     This Agreement has been negotiated on an arm's-length basis by the parties
and their respective counsel and will be interpreted fairly in accordance with
its terms without any strict construction in favor of or against either party.

     9.10 GOVERNING LAW AND VENUE

     This Agreement will be governed by and interpreted in accordance with the
local laws of the State of Washington, U.S.A., without regard to conflicts of
law provisions to the contrary. The parties waive application of the provisions
of the 1980 U.N. Convention on Contracts for the International Sale of Goods, as
amended. Each party irrevocably consents to the jurisdiction and venue of the
state and federal courts in King County, Washington, U.S.A., for any action,
claim, proceeding or suit arising out of or in connection with this Agreement.
Buyer will not commence or prosecute any suit or claim to enforce this
Agreement, or otherwise arising under or by reason of this Agreement, other than
in such courts.

     9.11 ENTIRE AGREEMENT

     This Agreement contains the entire agreement, and supersedes any and all
prior agreements, between the parties with regard to the subject matter hereof.
This Agreement may not be amended except in a written instrument signed by the
party to be bound thereby. This Agreement may be executed in two or more
counterparts, all of which will constitute but one and the same instrument.

                                      -13

<PAGE>

     IN WITNESS WHEREOF, the parties have entered into and signed this Agreement
as of the date first written above.

LSO:                                    BUYER:

Light Sciences Oncology, Inc.           Light Sciences Corporation

By (Signature): /s/ M. J. Winship       By (Signature): /s/ Albert Luderer
                ---------------------                   ------------------------
Name (Print): M. J. Winship             Name (Print): Albert Luderer
Title (Print): COO                      Title (Print): CEO

Address: 34931 SE Douglas Street        Address: 34931 SE Douglas Street
         Suite 200                               Suite 200
         Snoqualmie, WA 98065                    Snoqualmie, WA 98065
         Facsimile:                              Facsimile:
                    -----------------                       --------------------

                                      -14<PAGE>

                                                                   Exhibit 10.15

                          LIGHT SCIENCES ONCOLOGY, INC.

                           INVESTORS RIGHTS AGREEMENT

     THIS INVESTORS RIGHTS AGREEMENT (this "AGREEMENT") is made and entered into
as of October 6, 2005 (the "EFFECTIVE DATE") by and among Light Sciences
Oncology, Inc., a Washington corporation (the "COMPANY"), each of the persons
and entities on Schedule I attached hereto (the "FOUNDERS") and each of the
persons and entities on Schedule II attached hereto (the "INVESTORS"). The
Company, the Founders and the Investors who become a party to this Agreement
pursuant to Section 3.10 hereof are the "parties" hereto.

                                    RECITALS

     WHEREAS, certain Investors are parties to that certain Series A Preferred
Stock Purchase Agreement, dated as of the Effective Date, between the Company
and the persons and entities listed on Schedule I thereto (the "SERIES A
AGREEMENT"), and certain of the Company's and Investors' obligations thereunder
are conditioned upon the execution and delivery by the Company, the Founders and
the Investors of this Agreement.

     WHEREAS, in order to induce the Company to enter into the Series A
Agreement and to induce the Investors to invest funds in the Company pursuant to
the Series A Agreement, the parties hereto have agreed to enter into this
Agreement.

     NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:

                                    AGREEMENT

                                   SECTION 1

                               CERTAIN DEFINITIONS

     The following terms, for purposes of this Agreement, shall have their
respective meanings as set forth below in this Section 1:

     1.1 "ARTICLES" shall mean, at any time, the Company's Articles of
Incorporation as filed and effective at such time under the Washington Business
Corporation Act, as amended.

     1.2 "CHANGE OF CONTROL" shall mean (x) any consolidation or merger of the
Company with or into any other corporation or other entity, or any other
corporate reorganization, in which the shareholders of the Company immediately
prior to such consolidation, merger or reorganization, own less than 50% of the
Company's voting power immediately after such consolidation, merger or
reorganization; (y) any transaction or series of related transactions to which
the Company is a party in which in excess of fifty percent (50%) of the
Company's voting power is transferred to a party or parties who were not
shareholders or affiliates of shareholders

<PAGE>

prior to such transfer (other than an equity financing exclusively for capital
raising purposes in which the Company is the surviving corporation, including a
transaction in which holders prior to such transaction own less than 50% of the
total voting power of the Company immediately after the closing of such
financing); or (z) a sale, lease, transfer or other disposition (including,
without limitation, by an exclusive license of all or substantially all of its
rights in the material intellectual property of the Company for a term of at
least all or substantially all of the effective period of the material patents
included therein) of all or substantially all of the assets of the Company.

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

     1.4 "COMMON STOCK" shall mean the Company's Common Stock, par value $0.001
per share.

     1.5 "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended, or any similar successor federal statute, and the rules and regulations
thereunder, all as the same shall be in effect from time to time.

     1.6 "HOLDER" shall mean any Investor who holds Registrable Securities and
any holder of Registrable Securities to whom the registration rights conferred
by this Agreement have been transferred in compliance with the provisions of
Section 3.10 below.

     1.7 "INITIATING HOLDERS" shall mean any Holder or Holders who, in the
aggregate, hold not less than twenty-five percent (25%) of the outstanding
Registrable Securities that are issued or issuable upon conversion of the Series
A Shares.

     1.8 "QUALIFIED IPO" shall mean the Company's initial firm commitment
underwritten public offering pursuant to an effective registration statement
under the Securities Act of 1933, as amended, covering the offer and sale of
Common Stock for the account of the Company at a price per share of at least
$15.00 (as adjusted for any stock dividends, combinations, splits,
recapitalizations and the like with respect to the Common Stock after the date
hereof) and resulting in at least $40,000,000 of gross proceeds to the Company,
and pursuant to which the Company obtains a listing for its shares on the New
York Stock Exchange or the NASDAQ National Market System.

     1.9 "REGISTRABLE SECURITIES" shall mean (i) shares of Common Stock issued
or issuable pursuant to the conversion of the Series A Shares, and (ii) any
shares of Common Stock issued as a dividend or other distribution with respect
to or in exchange for or in replacement of the shares referenced in clause (i)
above; provided, however, that Registrable Securities shall not include any
shares of Common Stock which have (x) previously been registered, (y) been sold
to the public either pursuant to a registration statement or Rule 144 or (z)
been sold in a private transaction in which the transferor's rights under this
Agreement are not assigned.

     1.10 The terms "REGISTER," "REGISTERED" and "REGISTRATION" shall refer to a
registration effected by preparing and filing a registration statement in
compliance with the Securities Act, and the declaration or ordering of the
effectiveness of such registration statement by the Commission.

                                        2

<PAGE>

     1.11 "REGISTRATION EXPENSES" shall mean all expenses incurred in effecting
any registration pursuant to this Agreement, including, without limitation, all
registration, qualification and filing fees, printing expenses, escrow fees,
fees and disbursements of counsel for the Company, blue sky fees and expenses,
expenses of any regular or special audits incident to or required by any such
registration and, in the case of a registration pursuant to Section 3.1 or
Section 3.4 hereof, reasonable fees and disbursements for a single counsel for
the selling Holders. Notwithstanding the foregoing, "REGISTRATION EXPENSES"
shall not include Selling Expenses and the compensation of regular employees of
the Company (which compensation to such employees shall be paid in any event by
the Company).

     1.12 "RULE 144" shall mean Rule 144 as promulgated by the Commission under
the Securities Act, as such Rule may be amended from time to time, or any
similar successor rule that may be promulgated by the Commission.

     1.13 "RULE 145" shall mean Rule 145 as promulgated by the Commission under
the Securities Act, as such Rule may be amended from time to time, or any
similar successor rule that may be promulgated by the Commission.

     1.14 "SECURITIES ACT" shall mean the Securities Act of 1933, as amended, or
any similar successor federal statute, and the rules and regulations thereunder,
all as the same shall be in effect from time to time.

     1.15 "SELLING EXPENSES" shall mean any and all underwriting discounts,
selling commissions and stock transfer taxes applicable to the sale of
Registrable Securities.

     1.16 "SERIES A SHARES" shall mean shares of the Company's Series A
Preferred Stock, par value $0.001 per share.

     1.17 "SHARES" shall mean the Series A Shares and any shares of Common Stock
issued upon conversion thereof.

     1.18 "SUBSIDIARY" shall have the meaning set forth in Section 3.2 of the
Purchase Agreement.

                                   SECTION 2

                            RESTRICTIONS ON TRANSFER

     2.1 Legends. Each certificate representing Registrable Securities shall
(unless otherwise permitted by the provisions of this Agreement) be stamped or
otherwise imprinted with a legend substantially similar to the following (in
addition to any legend required under applicable state securities laws or any
other agreement entered into by the original Investor holding such certificate
and the Company):

     THE SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
     ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD OR TRANSFERRED, ASSIGNED,
     PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER SUCH ACT

                                        3

<PAGE>

     OR UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL OR OTHER EVIDENCE,
     REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION IS NOT
     REQUIRED.

     2.2 Reissuance. The Company shall be obligated to reissue promptly
unlegended certificates at the request of any Holder thereof if the Holder shall
have obtained an opinion of counsel, at such Holder's expense (which counsel may
be counsel to the Company) and reasonably acceptable to the Company, to the
effect that the securities proposed to be disposed of may lawfully be so
disposed of without registration, qualification or other compliance with any
legend.

     2.3 Removal. Any legend endorsed on an instrument pursuant to applicable
state securities laws and the stop-transfer instructions with respect to such
securities shall be removed upon receipt by the Company of an order of the
appropriate blue sky authority authorizing such removal.

     2.4 Further Limitations on Disposition. No Holder shall make any
disposition of all or any portion of Registrable Securities unless and until the
transferee has agreed in writing for the benefit of the Company to be bound by
this Agreement, the Co-Sale Agreement (unless it has been terminated) and the
Voting Agreement (unless it has been terminated), and:

          (a) There is then in effect a registration statement under the
     Securities Act covering such proposed disposition and such disposition is
     made in accordance with such registration statement; or

          (b) (i) The Holder shall have notified the Company of the proposed
     disposition and shall have furnished the Company with a reasonably detailed
     statement of the circumstances surrounding the proposed disposition, and
     (ii) if requested by the Company, the Holder shall have furnished the
     Company with an opinion of counsel or other evidence reasonably
     satisfactory to the Company that such disposition will not require
     registration of such shares under the Securities Act. It is agreed that the
     Company will not require opinions of counsel for transactions made pursuant
     to Rule 144 except in unusual circumstances.

          (c) Notwithstanding the provisions of subsections (a) or (b) above, no
     such registration statement or opinion of counsel or other evidence shall
     be necessary for a transfer by a Holder that is a partnership to a partner
     of such partnership, or to the estate of any such partner or the transfer
     by gift, will or intestate succession of any partner to his or her spouse
     or to the siblings, lineal descendants or ancestors of such partner or his
     or her spouse, if the transferee agrees in writing to be subject to the
     terms hereof to the same extent as if he or she were a Holder hereunder.

                                        4

<PAGE>

                                   SECTION 3

                               REGISTRATION RIGHTS

     3.1 Requested Registration.

          (a) Request for Registration. If the Company shall receive from
     Initiating Holders, at any time not earlier than six (6) months after the
     earlier of (i) the first date that the Company's securities trade on a
     national securities exchange or list on a national automatic quotation
     system, or (ii) the initial public offering of the Company's securities, a
     written request that the Company effect any registration with respect to
     any portion of such Initiating Holders' Registrable Securities, then the
     Company will:

               (i) within ten (10) days of such request, give written notice of
          the proposed registration to all other Holders; and

               (ii) as soon as practicable, but in any event within seventy (70)
          days of such written request, file and thereafter use its best efforts
          to effect such registration as soon as practicable (including, without
          limitation, filing post-effective amendments, appropriate
          qualifications under applicable blue sky or other state securities
          laws and appropriate compliance with the Securities Act) as would
          permit or facilitate the sale and distribution of all or such portion
          of such Registrable Securities as are specified in such request,
          together with all or such portion of the Registrable Securities of any
          Holder or Holders joining in such request as are specified in a
          written request received by the Company within twenty (20) days after
          the written notice from the Company referenced in clause (i) above is
          mailed or delivered.

     The Company shall not be obligated to effect, or to take any action to
effect, any such registration pursuant to this Section 3.1:

          (A) In any particular jurisdiction in which the Company would be
     required to execute a general consent to service of process in effecting
     such registration, qualification or compliance, unless the Company is
     already subject to service in such jurisdiction and except as may be
     required by the Securities Act;

          (B) After the Company has initiated two (2) such registrations
     pursuant to this Section 3.1(a) (counting for these purposes registrations
     which have been (1) declared or ordered effective and pursuant to which
     securities have been sold or (2) withdrawn by the Holders and as to which
     the Holders have not elected to bear the Registration Expenses pursuant to
     Section 3.3 hereof); or

          (C) If the Initiating Holders propose to dispose of shares of
     Registrable Securities which may be immediately registered on Form S-3
     pursuant to a request made under Section 3.4 hereof.

          (D) During the period starting with the date forty five (45) days
     prior to the Company's good faith estimate of the date of filing of, and
     ending on a date one hundred

                                        5

<PAGE>

     twenty (120) days after the effective date of a registration subject to
     Section 3.2 hereof; provided that the Company complies with Section 3.2, is
     actively employing in good faith reasonable efforts to cause such
     registration statement to become effective, and the Company delivers notice
     of such intent to the Initiating Holders within fifteen (15) days of the
     registration request; provided, further, that the Company shall not defer
     its registration obligations under this Agreement for more than an
     aggregate of Two Hundred Ten (210) days in any twelve (12) month period
     pursuant to this Section 3.1(a)(D) and/or Section 3.1(b).

          (b) Deferment. Subject to the foregoing clauses (A) through (D), the
     Company shall file a registration statement covering the Registrable
     Securities so requested to be registered as soon as practicable after
     receipt of the request or requests of the Initiating Holders; provided,
     however, that if (i) in the good faith judgment of the Board of Directors
     of the Company, such registration would be seriously detrimental to the
     Company, and the Board of Directors of the Company concludes, as a result,
     that it is in the best interests of the Company to defer the filing of such
     registration statement at such time, and (ii) the Company shall furnish to
     the Initiating Holders a certificate signed by the President of the Company
     stating that, in the good faith judgment of the Board of Directors of the
     Company, it would be seriously detrimental to the Company for such
     registration statement to be filed in the near future and that it is,
     therefore, in the best interests of the Company to defer the filing of such
     registration statement, then the Company shall have the right to defer such
     filing for the period during which such filing would be seriously
     detrimental, provided that the Company may not defer the filing for a
     period of more than one hundred twenty (120) days after receipt of the
     request of the Initiating Holders; and, provided, further, that (A) the
     Company shall not defer its obligations in this manner more than once in
     any twelve (12) month period, and (B) the Company shall not defer its
     registration obligations under this Agreement for more than an aggregate of
     Two Hundred Ten (210) days in any twelve (12) month period pursuant to this
     Section 3.1(b) and/or Section 3.1(a)(D).

     The registration statement filed pursuant to the request of the Initiating
Holders may, subject to the provisions of Sections 3.1(d) and 3.12 below,
include other securities of the Company with respect to which registration
rights have been granted in accordance with this Agreement and any other
agreements entered into between the Company and the Investors, and may include
securities of the Company being sold for the account of the Company.

          (c) Underwriting. The right of any Holder to participate in an
     underwritten registration pursuant to Section 3.1 shall be conditioned upon
     such Holder's participation in such underwriting and the inclusion of such
     Holder's Registrable Securities in the underwriting (unless otherwise
     mutually agreed by a majority in interest of the Initiating Holders and
     such Holder with respect to such participation and inclusion) to the extent
     provided herein. A Holder may elect to include in such underwriting all or
     a part of the Registrable Securities such Holder holds (subject to the
     other provisions of this Agreement).

          (d) Procedures. If the Company shall request inclusion in any
     registration pursuant to Section 3.1 of securities being sold for its own
     account, or if other persons

                                        6

<PAGE>

     (other than Holders) shall request inclusion of securities held by them in
     any registration pursuant to Section 3.1, the Initiating Holders shall, on
     behalf of all Holders, offer to include such securities in the underwriting
     and shall condition such offer on their participation in such underwriting
     and acceptance of the further applicable provisions of this Section 3
     (including Section 3.12 below). The Company shall (together with all
     Holders and other persons proposing to distribute their securities through
     such underwriting) enter into an underwriting agreement in customary form
     with the representative of the underwriter or underwriters selected for
     such underwriting by a majority in interest of the Initiating Holders
     (subject to the approval of the Company, which approval shall not be
     unreasonably withheld or delayed). Notwithstanding any other provision of
     this Section 3.1, if the representative of the underwriters advises the
     Initiating Holders in writing that marketing factors require a limitation
     on the number of shares to be underwritten, the number of shares to be
     included in the underwriting or registration shall be allocated as set
     forth in Section 3.12 below. If a person who has requested inclusion in
     such registration as provided above does not agree to the terms of any such
     underwriting, such person shall be excluded therefrom by written notice
     from the Company, the underwriter(s) or the Initiating Holders. Any
     Registrable Securities or other securities excluded or withdrawn from such
     underwriting shall also be withdrawn from such registration. If shares are
     so withdrawn from the registration and if the number of shares to be
     included in such registration was previously reduced as a result of
     marketing factors pursuant to this Section 3.1(d), then the Company shall
     offer to all holders who have retained rights to include securities in the
     registration the right to include additional securities in the registration
     in an aggregate amount equal to the number of shares so withdrawn, with
     such shares to be allocated among such Holders requesting additional
     inclusion in accordance with the provisions of Section 3.12 below.

     3.2 Company Registration.

          (a) If, at any time the Company shall determine to register any of its
     securities either for its own account or the account of a security holder
     or holders exercising their respective demand registration rights, other
     than a registration relating solely to employee benefit plans, a
     registration relating to the offer and sale of debt securities, a
     registration relating to a corporate reorganization or other transaction
     under Rule 145, or a registration on any registration form that does not
     permit secondary sales (an "EXCLUDED REGISTRATION"), the Company will:

               (i) promptly give to each Holder written notice thereof; and

               (ii) use its reasonable best efforts to include in such
          registration (and any related qualification under blue sky laws or
          other compliance), except as set forth in Section 3.2(b) below, and in
          any underwriting involved therein, all the Registrable Securities
          specified in a written request or requests made by any Holder and
          received by the Company within ten (10) days after the written notice
          from the Company described in clause (i) above is mailed or delivered
          by the Company. Such written request may specify all or a part of a
          Holder's Registrable Securities.

                                        7

<PAGE>

          (b) Underwriting. If the registration of which the Company gives
     notice is for a registered public offering involving an underwriting, the
     Company shall so advise the Holders as a part of the written notice given
     pursuant to Section 3.2(a)(i). In such event, the right of any Holder to
     registration pursuant to this Section 3.2 shall be conditioned upon such
     Holder's participation in such underwriting and the inclusion of such
     Holder's Registrable Securities in the underwriting to the extent provided
     herein. All Holders proposing to distribute their securities through such
     underwriting shall (together with the Company and the other holders of
     securities of the Company with registration rights to participate therein
     distributing their securities through such underwriting) enter into an
     underwriting agreement in customary form with the representative of the
     underwriter(s) selected by the Company.

     Notwithstanding any other provision of this Section 3.2, if the
representative of the underwriters advises the Company in writing that marketing
factors require a limitation on the number of shares to be underwritten, the
representative may (subject to the limitations set forth below) exclude all
Registrable Securities from, or limit the number of Registrable Securities to be
included in, the registration and underwriting. If the registration is the first
firmly underwritten public offering made by the Company pursuant to an effective
registration statement on form S-1 under the Securities Act (an "INITIAL PUBLIC
OFFERING"), the Company may limit, to the extent so advised by the underwriters,
the amount of securities (including Registrable Securities) to be included in
the registration by the Company's shareholders (including the Holders), or may
exclude, to the extent so advised by the underwriters, such underwritten
securities entirely from such registration. If such registration is not a
Initial Public Offering or is the second or any subsequent Company-initiated
registered offering of the Company's securities to the general public, the
Company may limit, to the extent so advised by the underwriters, the amount of
securities to be included in the registration by the Company's shareholders
(including the Holders); provided, however, that the aggregate value of
securities (including Registrable Securities) to be included in such
registration by the Company's shareholders (including the Holders) may not be so
reduced to less than twenty-five percent (25%) of the total value of all
securities included in such registration without the consent of more than fifty
percent (50%) of the Holders. The Company shall so advise all holders of
securities requesting registration, and the number of shares of securities that
are entitled to be included in the registration and underwriting shall be
allocated first to the Company for securities being sold for its own account
(subject to the foregoing provisions of this paragraph) and thereafter as set
forth in Section 3.12.

     If any person does not agree to the terms of any such underwriting, such
person shall be excluded therefrom by written notice from the Company or the
underwriter. Any Registrable Securities or other securities so excluded or
withdrawn from such underwriting shall be withdrawn from such registration. If
shares are so withdrawn from the registration or if the number of shares of
Registrable Securities to be included in such registration was previously
reduced as a result of marketing factors, the Company shall then offer to all
persons who have retained the right to include securities in the registration
the right to include additional securities in the registration in an aggregate
amount equal to the number of shares so withdrawn, with such shares to be
allocated among the persons requesting additional inclusion in accordance with
the provisions of Section 3.12 below.

                                        8

<PAGE>

          (c) Right to Terminate Registration. The Company shall have the right
     to terminate or withdraw any registration initiated by it under this
     Section 3.2 prior to the effectiveness of such registration whether or not
     any Holder has elected to include securities in such registration. The
     Registration Expenses of such withdrawn registration shall be borne by the
     Company.

     3.3 Expenses of Registration. All Registration Expenses incurred in
connection with (i) the first two registrations pursuant to Section 3.1 hereof
and (ii) any registration, qualification or compliance pursuant to Section 3.2
or Section 3.4 hereof shall be borne by the Company; provided, however, that if
the Holders bear the Registration Expenses for any registration proceeding begun
pursuant to Section 3.1 and subsequently withdrawn by the Holders registering
shares therein, such registration proceeding shall not be counted as a requested
registration pursuant to Section 3.1 hereof; provided further that the Company
shall not be required to pay for the expenses of any registration proceeding
begun pursuant to Section 3.1 or 3.4 if the registration request is subsequently
withdrawn at the request of the Holders of a majority of the Registrable
Securities to be registered, or with respect to registrations pursuant to
Section 3.4 because a sufficient number of Holders shall have withdrawn so that
the minimum offering conditions set forth in Section 3.4 are no longer satisfied
(in which case all participating Holders shall bear such expenses pro rata among
each other based on the number of Registrable Securities requested to be so
registered, unless the Holders of a majority of the Registrable Securities agree
to count such withdrawn registration as a requested registration pursuant to
Section 3.1 or Section 3.4, as applicable). Furthermore, in the event that a
withdrawal by the Holders is based upon material adverse information relating to
the Company that is different from the information known or available (upon
request from the Company or otherwise) to the Holders requesting registration at
the time of their request for registration under Section 3.1, such registration
shall not be treated as a counted registration for purposes of Section 3.1
hereof, even though the Holders do not bear the Registration Expenses for such
registration, and the Company shall bear all Registration Expenses of such
withdrawn registration. All Selling Expenses relating to securities registered
on behalf of the Holders shall be borne by the holders of securities included in
such registration pro rata among each other on the basis of the number of
Registrable Securities so registered.

     3.4 Registration on Form S-3.

          (a) After the initial public offering of the Company's securities, the
     Company shall use its best efforts to qualify for registration on Form S-3
     or any comparable or successor form or forms. After the Company has
     qualified for the use of Form S-3, in addition to the rights contained in
     the foregoing provisions of this Section 3 and subject to the conditions
     set forth in this Section 3, the Holders of Registrable Securities shall
     have the right to request registrations on Form S-3 (such requests shall be
     in writing and shall state the number of shares of Registrable Securities
     to be disposed of and the intended methods of disposition of such shares by
     such Holders); provided, however, that the Company shall not be obligated
     to effect any such registration (i) if the Holders, together with the
     holders of any other securities of the Company entitled to inclusion in
     such registration, propose to sell Registrable Securities and such other
     securities (if any) on Form S-3 at an aggregate price to the public of less
     than $2,000,000, (ii) in the event that the Company shall furnish the
     certification described in paragraph 3.1(b)(ii) (but

                                        9

<PAGE>

     subject to the limitations set forth therein), or (iii) if, in the
     preceding twelve-month period, the Company has effected two (2) such
     registrations under this Section 3.4 in such period.

          (b) If a request complying with the requirements of Section 3.4(a)
     hereof is delivered to the Company, the provisions of Sections 3.1(a)(i),
     (ii), (A) and (D) and Section 3.1(b) above shall apply to such
     registration. If the registration is for an underwritten offering, the
     provisions of Sections 3.1(c) and 3.1(d) hereof shall also apply to such
     registration.

     3.5 Registration Procedures. In the case of each registration effected by
the Company pursuant to Section 3, the Company will keep each Holder advised in
writing as to the initiation of each registration and as to the completion
thereof. At its expense, the Company will use its best efforts to:

          (a) Keep such registration effective for a period of ninety (90) days,
     or until the Holder or Holders have completed the distribution described in
     the registration statement relating thereto, whichever first occurs;
     provided, however, that (i) such 90-day period shall be extended for a
     period of time equal to the period the Holder refrains from selling any
     securities included in such registration (A) at the request of the Company
     or an underwriter of Common Stock (or other securities) of the Company, or
     (B) due to any defect in any prospectus or the failure by the Company to
     provide sufficient copies of any prospectus required to be delivered; and
     (ii) in the case of any registration of Registrable Securities on Form S-3
     which are intended to be offered on a continuous or delayed basis, such
     90-day period shall be extended, if necessary, to keep the registration
     statement effective until all such Registrable Securities are sold,
     provided that Rule 145, or any successor rule under the Securities Act,
     permits an offering on a continuous or delayed basis, and provided,
     further, that applicable rules under the Securities Act governing the
     obligation to file a post-effective amendment permit, in lieu of filing a
     post-effective amendment that (x) includes any prospectus required by
     Section 10(a)(3) of the Securities Act or (y) reflects facts or events
     representing a material or fundamental change in the information set forth
     in the registration statement, the incorporation by reference of
     information otherwise required to be included in (x) and (y) above (from
     periodic reports filed pursuant to Section 13 or 15(d) of the Exchange
     Act);

          (b) Prepare and file with the Commission such amendments and
     supplements to such registration statement and the prospectus used in
     connection with such registration statement as may be necessary to comply
     with the provisions of the Securities Act with respect to the disposition
     of all securities covered by such registration statement for the period set
     forth in subsection (a) above;

          (c) Furnish such number of prospectuses, including preliminary
     prospectuses and other documents incident thereto, in conformity with the
     Securities Act, including any amendment of or supplement to the prospectus,
     as a Holder from time to time may reasonably request;

                                       10

<PAGE>

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

          (e) Notify each seller of Registrable Securities covered by such
     registration statement at any time when a prospectus relating thereto is
     required to be delivered under the Securities Act of the happening of any
     event as a result of which the prospectus included in such registration
     statement, as then in effect, includes an untrue statement of a material
     fact or omits to state a material fact required to be stated therein or
     necessary to make the statements therein not misleading or incomplete in
     the light of the circumstances then existing, and at the request of any
     such seller, prepare and furnish to such seller a reasonable number of
     copies of a supplement to or an amendment of such prospectus as may be
     necessary so that, as thereafter delivered to the purchasers of such
     shares, such prospectus shall not include an untrue statement of a material
     fact or omit to state a material fact required to be stated therein or
     necessary to make the statements therein not misleading or incomplete in
     the light of the circumstances then existing;

          (f) Cause all such Registrable Securities registered pursuant to such
     registration statement to be listed on each securities exchange on which
     similar securities issued by the Company are then listed;

          (g) Provide a transfer agent and registrar for all Registrable
     Securities registered pursuant to such registration statement and a CUSIP
     number for all such Registrable Securities, in each case not later than the
     effective date of such registration;

          (h) Furnish, at the request of a majority of the Holders participating
     in the registration, on the date that such Registrable Securities are
     delivered to the underwriters for sale, if such securities are being sold
     through underwriters, (i) an opinion, dated as of such date, of the counsel
     representing the Company for the purposes of such registration, in form and
     substance as is customarily given to underwriters in an underwritten public
     offering and reasonably satisfactory to a majority in interest of the
     Holders requesting registration, addressed to the underwriters, and (ii) a
     letter dated as of such date, from the independent certified public
     accountants of the Company, in form and substance as is customarily given
     by independent certified public accountants to underwriters in an
     underwritten public offering and reasonably satisfactory to a majority in
     interest of the Holders requesting registration, addressed to the
     underwriters;

          (i) Make available for inspection by any seller of Registrable
     Securities, any underwriter participating in any disposition pursuant to
     such registration statement, and any attorney, accountant, or another agent
     retained by any such seller or underwriter (collectively, the
     "INSPECTORS"), all financial and other records, pertinent corporate
     documents, and properties of the Company (collectively, the "RECORDS") as
     shall be reasonably necessary to enable them to exercise their due
     diligence responsibility, and cause the Company's officers, directors, and
     employees to supply all information

                                       11

<PAGE>

     reasonably requested by any such Inspector in connection with such
     registration statement. Records which the Company determines, in good
     faith, to be confidential shall not be disclosed by the Inspectors unless
     (i) the disclosure of such Records is necessary to avoid or correct a
     misstatement or omission in the registration statement or (ii) the release
     of such Records is ordered pursuant to a subpoena or other order from a
     court of competent jurisdiction. The seller of Registrable Securities
     agrees that it will, upon learning that disclosure of such Records is
     sought in a court of competent jurisdiction, give notice to the Company and
     allow the Company, at the Company's expense, to undertake appropriate
     action to prevent disclosure of the Records deemed confidential;

          (j) Otherwise use its best efforts to comply with all applicable rules
     and regulations of the Commission, and make available to its security
     holders, as soon as reasonably practicable, an earnings statement covering
     the period of at least 12 months, but not more than 18 months, beginning
     with the first month after the effective date of the registration
     statement,, which earnings statement shall satisfy the provisions of
     Section 11(a) of the Securities Act and Rule 158 thereunder; and

          (k) In connection with any underwritten offering pursuant to a
     registration statement filed pursuant to Section 3.1 above, the Company
     will enter into an underwriting agreement in form reasonably necessary to
     effect the offer and sale of Common Stock, provided that such underwriting
     agreement contains customary underwriting provisions and, if the
     underwriter so requests, the underwriting agreement also contains customary
     contribution provisions and provided further that each Holder participating
     in such underwriting shall also enter into and perform its obligations
     under such an agreement.

     3.6 Indemnification. In the event any Registrable Securities are included
in a registration statement under Sections 3.1, 3.2 or 3.4 above:

          (a) To the extent permitted by law, the Company will indemnify and
     hold harmless each Holder, the partners, shareholders, members, officers
     and directors of each Holder, legal counsel, accountant, any underwriter
     (as defined in the Securities Act) for such Holder and each person, if any,
     who controls such Holder or underwriter within the meaning of Section 15 of
     the Securities Act, against any losses, claims, damages or liabilities
     (joint or several) to which they may become subject under the Securities
     Act, the Exchange Act or other federal or state law, insofar as such
     losses, claims, damages or liabilities (or actions in respect thereof)
     arise out of or are based upon any of the following statements, omissions
     or violations (collectively a "VIOLATION") by the Company: (i) any untrue
     statement or alleged untrue statement of a material fact contained in such
     registration statement, including any preliminary prospectus or final
     prospectus contained therein, any exhibits attached thereto or any
     amendments or supplements thereto, (ii) 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 (iii) any violation or
     alleged violation by the Company of the Securities Act, the Exchange Act,
     any state securities law or any rule or regulation promulgated under the
     Securities Act, the Exchange Act or any state securities law and relating
     to action or

                                       12

<PAGE>

     inaction required by the Company in connection with the offering covered by
     such registration statement; and the Company will reimburse each such
     Holder, partner, shareholder, member, officer or director, legal counsel,
     accountant, underwriter or controlling person for any legal or other
     expenses reasonably incurred by them in connection with investigating or
     defending any such loss, claim, damage, liability or action; provided,
     however, that the indemnity agreement contained in this Section 3.6(a)
     shall not apply to amounts paid in settlement of any such loss, claim,
     damage, liability or action if such settlement is effected without the
     consent of the Company, which consent shall not be unreasonably withheld or
     delayed, nor shall the Company be liable in any such case for any such
     loss, claim, damage, liability or action to the extent that it arises out
     of or is based upon a Violation which occurs in reliance upon and in
     conformity with written information furnished expressly for use in
     connection with such registration by such Holder or any partner,
     shareholder, member, officer, director, legal counsel, accountant,
     underwriter or controlling person of such Holder.

          (b) To the extent permitted by law, each Holder will, if Registrable
     Securities held by such Holder are included in the securities as to which
     such registration, qualification or compliance is being effected, indemnify
     and hold harmless the Company, each of its directors, its officers and each
     person, if any, who controls the Company within the meaning of the
     Securities Act, any underwriter and any other Holder selling securities
     under such registration statement or any of such other Holder's partners,
     shareholders, members, directors or officers or any person who controls
     such Holder, against any losses, claims, damages or liabilities (joint or
     several) to which any of the foregoing persons may become subject under the
     Securities Act, the Exchange Act or other federal or state law, insofar as
     such losses, claims, damages or liabilities (or actions in respect thereto)
     arise out of or are based upon any Violation, in each case to the extent
     (and only to the extent) that such Violation occurs in reliance upon and in
     conformity with written information furnished by such Holder under an
     instrument duly executed by such Holder and stated to be specifically for
     use in connection with such registration; and each such Holder will
     reimburse any legal or other expenses reasonably incurred by any person
     intended to be indemnified pursuant to this subsection 3.6(b), in
     connection with investigating or defending any such loss, claim, damage,
     liability or action; provided, however, that the indemnity agreement
     contained in this Section 3.6(b) shall not apply to amounts paid in
     settlement of any such loss, claim, damage, liability or action if such
     settlement is effected without the consent of such Holder, which consent
     shall not be unreasonably withheld or delayed; and provided, further, that
     in no event shall any indemnity under this Section 3.6(b) exceed the net
     proceeds from the offering received by such Holder.

          (c) Promptly after receipt by an indemnified party under this Section
     3.6 of notice of the commencement of any action (including any governmental
     action), such indemnified party will, if a claim in respect thereof is to
     be made against any indemnifying party under this Section 3.6, deliver to
     the indemnifying party a written notice of the commencement thereof and the
     indemnifying party shall have the right to participate in, and, to the
     extent the indemnifying party so desires, jointly with any other
     indemnifying party similarly noticed, to assume the defense thereof with
     counsel mutually satisfactory to the parties; provided, however, that an
     indemnified party shall

                                       13

<PAGE>

     have the right to retain its own counsel, with the fees and expenses to be
     paid by the indemnifying party, if representation of such indemnified party
     by the counsel retained by the indemnifying party would be inappropriate
     due to actual or potential differing interests between such indemnified
     party and any other party represented by such counsel in such proceeding.
     The failure to deliver written notice to the indemnifying party within a
     reasonable time of the commencement of any such action, if materially
     prejudicial to its ability to defend such action, shall relieve such
     indemnifying party of any liability to the indemnified party under this
     Section 3.6, but the omission so to deliver written notice to the
     indemnifying party will not relieve it of any liability that it may have to
     any indemnified party otherwise than under this Section 3.6.

          (d) If the indemnification provided for in this Section 3.6 is held by
     a court of competent jurisdiction to be unavailable to an indemnified party
     with respect to any losses, claims, damages or liabilities referred to
     herein, the indemnifying party, in lieu of indemnifying such indemnified
     party thereunder, shall, to the extent permitted by applicable law,
     contribute to the amount paid or payable by such indemnified party as a
     result of such loss, claim, damage or liability in such proportion as is
     appropriate to reflect the relative fault of the indemnifying party, on the
     one hand, and of the indemnified party, on the other, in connection with
     the Violation(s) that resulted in such loss, claim, damage or liability, as
     well as any other relevant equitable considerations. The relative fault of
     the indemnifying party and of the indemnified party shall be determined by
     a court of law by reference to, among other things, whether the untrue or
     alleged untrue statement of a material fact or the omission to state a
     material fact relates to information supplied by the indemnifying party or
     by the indemnified party and the parties' relative intent, knowledge,
     access to information and opportunity to correct or prevent such statement
     or omission; provided, however, that in no event shall any contribution by
     a Holder hereunder exceed the gross proceeds from the offering received by
     such Holder; and provided further that no person or entity guilty of
     fraudulent misrepresentation (within the meaning of Section 11(f) of the
     Securities Act) will be entitled to contribution from any person or entity
     who was not guilty of such fraudulent misrepresentation.

          (e) The obligations of the Company and Holders under this Section 3.6
     shall survive completion of any offering of Registrable Securities in a
     registration statement and the termination of this agreement. No
     indemnifying party, in the defense of any such claim or litigation, shall,
     except with the consent of each indemnified party, consent to entry of any
     judgment or enter into any settlement which does not include as an
     unconditional term thereof the giving by the claimant or plaintiff to such
     indemnified party of a release from all liability in respect to such claim
     or litigation. Each indemnified party shall furnish such information
     regarding itself or the claim in question as an indemnifying party may
     reasonably request in writing and as shall be reasonably required in
     connection with defense of such claim and litigation resulting therefrom.

          (f) Notwithstanding the foregoing, to the extent that the provisions
     on indemnification and contribution contained in the underwriting agreement
     entered into in connection with the underwritten public offering are in
     conflict with the foregoing provisions, the provisions in the underwriting
     agreement shall control with respect to any

                                       14

<PAGE>

     Holder party to such agreement (it being agreed that no such Holder shall
     be required to enter into an agreement containing such conflicting
     provisions without its consent).

     3.7 Information by Holder. It shall be a condition precedent to the
obligations of the Company to take any action pursuant to Sections 3.1, 3.2 or
3.4 above with respect to Registrable Securities of any selling Holder that such
Holder shall furnish to the Company such information regarding such Holder and
the distribution proposed by such Holder as the Company may reasonably request
in writing and as shall be reasonably required in connection with any
registration, qualification or compliance referred to in this Section 3.

     3.8 Limitations on Subsequent Registration Rights. From and after the date
of this Agreement, the Company shall not, without the prior written consent of a
majority in interest of the Holders, enter into any agreement with any holder or
prospective holder of any securities of the Company giving such holder or
prospective holder any (i) registration rights unless the terms thereof are
junior to and less favorable than the registration rights granted to the Holders
hereunder or (ii) piggyback registration rights (i.e., rights similar to those
set forth in Section 3.2(a) above) which would reduce the number of shares
includable by the holders in any registration pursuant to Section 3.2 above;
provided, however, that notwithstanding the foregoing or any other provision of
this Agreement to the contrary, any purchaser of Series A Shares from the
Company under the Series A Agreement shall be permitted to join this Agreement
as an Investor party hereto with only the consent of the Company.

     3.9 Rule 144 Reporting. With a view to making available to the Holders the
benefits of certain rules and regulations of the Commission which may permit the
sale of the Registrable Securities to the public without registration, the
Company agrees to use its best efforts to:

          (a) Make and keep public information available, as those terms are
     understood and defined in Rule 144, at all times from and after ninety (90)
     days following the effective date of the first registration filed by the
     Company under the Securities Act for an offering of its securities to the
     general public;

          (b) File with the Commission, in a timely manner, all reports and
     other documents required of the Company under the Exchange Act at any time
     after it has become subject to such reporting requirements; and

          (c) So long as a Holder owns any Registrable Securities, furnish to
     such Holder forthwith upon request: (i) a written statement by the Company
     as to its compliance with the reporting requirements of Rule 144 (at any
     time from and after ninety (90) days following the effective date of its
     initial public offering), and of the Exchange Act (at any time after it has
     become subject to such reporting requirements), or that it qualifies as a
     registrant whose securities may be resold pursuant to Form S-3 (at any time
     when it so qualifies); (ii) a copy of the most recent annual or quarterly
     report of the Company and such other reports and documents so filed by the
     Company; and (iii) such other reports and documents as a Holder may
     reasonably request in availing itself of any rule or regulation of the
     Commission allowing it to sell any such securities without registration.

                                       15

<PAGE>

     3.10 Assignment of Registration Rights. The rights to cause the Company to
register Registrable Securities pursuant to this Section 3 may be assigned by a
Holder only to a transferee or assignee of Registrable Securities which acquires
at least 100,000 shares of Registrable Securities (in each case as adjusted for
stock splits, stock dividends, combinations and other recapitalizations);
provided, however, that (i) the transferor shall, within a reasonable time after
such transfer, furnish to the Company written notice of the name and address of
such transferee or assignee and the securities with respect to which such
registration rights are being assigned, (ii) such transferee shall agree to be
subject to all restrictions and obligations set forth in this Agreement, and
(iii) such transfer or assignment of Registrable Securities shall be effected in
accordance with the terms of Section 2.4 hereof, the ROFR Agreement, the Voting
Agreement, and applicable securities laws; and provided, further, that any
Holder may transfer Registrable Securities either (a) to any "AFFILIATE(S)" (as
defined below) of such Holder (which, in the case of a Holder which is a limited
partnership, shall also include without limitation current and former limited
partners, general partners, members and principals of such Holder or any general
partner of such Holder) or (b) to such Holder's spouse, children or
grandchildren, or to a trust for the exclusive benefit of such Holder, such
Holder's spouse, children or grandchildren, without regard to the foregoing
numerical limitations so long as such Holder and all such assignees agree (as
evidenced in a writing to be delivered to the Company prior to any such
assignment) that such Holder (or its designee) will act as the single
attorney-in-fact for all such assignees for the purpose of exercising any
rights, receiving any notices or taking any other action under this Section 3.
For the purposes of determining the number of shares of Registrable Securities
held by a transferee or assignee, the holdings of transferees and assignees of a
partnership who are partners or retired partners of such partnership (including
spouses and ancestors, lineal descendants and siblings of such partners or
spouses who acquire Registrable Securities by gift, will or intestate
succession) shall be aggregated together and with the partnership; provided,
however, that all assignees and transferees who would not qualify individually
for assignment of registration rights shall have a single attorney-in-fact for
the purpose of exercising any rights, receiving any notices or taking any other
action under this Section 3. For purposes of this Section 3.10, the term
"affiliate" means, as to the entity in question, any person or entity that
directly or indirectly controls, is controlled by or is under common control
with the entity in question, and the term "control" means possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of an entity whether through ownership of voting securities, by
contract, or otherwise.

     3.11 "Market Stand Off" Agreement. In connection with the initial public
offering of the Company's Common Stock, each Holder and each Founder hereby
agrees that such Holder or Founder shall not sell or otherwise transfer or
dispose of any of the Company's securities held by such Holder or Founder (other
than those included in the registration at issue, if any) for a period specified
by the representative of the underwriters of Common Stock of the Company not to
exceed (i) one hundred eighty (180) days following the effective date of the
registration statement for such initial public offering or (ii) such longer
period requested by the underwriters as is necessary to comply with regulatory
restrictions on the publication of research reports (including, but not limited
to, NASD Rule 2711); provided that all officers and directors of the Company and
all other persons or entities owning at least one percent (1%) of the Company's
securities (on as as-converted basis) enter into substantially equivalent
agreements. The Company agrees to cause all officers, directors and holders of
one percent (1%) or more to be bound by the provisions of this Section 3.11 or
substantially equivalent restrictions. Each Holder

                                       16

<PAGE>

and Founder agrees to execute and deliver such other agreements as may be
reasonably requested by the Company or the underwriter which are consistent with
the foregoing or which are necessary to give further effect thereto. The Company
agrees that it shall not release any Holder or Founder (or any person referred
to in the preceding sentence) from the obligations imposed pursuant to this
Section 3.11 unless all Holders are so released on a proportionate basis
relative to their ownership of Registrable securities. The obligations described
in this Section 3.11 shall not apply to a registration relating solely to
employee benefit plans on Form S-8 or similar forms that may be promulgated in
the future, or a registration relating solely to a Rule 145 transaction on Form
S-4 or similar forms that may be promulgated in the future. The Company may
impose stop transfer instructions with respect to the shares of Common Stock (or
other securities) subject to the foregoing restriction until the end of said
period.

     3.12 Allocation of Registration Opportunities. In any circumstance in which
all of the Registrable Securities and other shares of Common Stock (including
shares of Common Stock issued or issuable upon conversion of shares of any
currently unissued series of Preferred Stock of the Company) with registration
rights (the "OTHER SHARES") requested to be included in a registration on behalf
of the Holders or other selling shareholders cannot be so included as a result
of limitations on the aggregate number of shares of Registrable Securities and
Other Shares that may be so included, the number of shares of Registrable
Securities and Other Shares that may be so included shall be allocated among the
Holders and other selling shareholders requesting inclusion of shares first to
the Holders pro rata on the basis of the number of shares of Registrable
Securities held by such Holders (assuming conversion) and then, if any
availability remains, to the other selling shareholders pro rata on the basis of
the number of Other Shares held by such other selling shareholders (assuming
conversion); provided, however, that such allocation shall not operate to reduce
the aggregate number of Registrable Securities and Other Shares to be included
in such registration. If any Holder or other selling shareholder does not
request inclusion of the maximum number of shares of Registrable Securities and
Other Shares allocated to such Holder or shareholder pursuant to the
above-described procedure, the remaining portion of the allocation of such
Holder or shareholder shall be reallocated among those requesting Holders and
other selling shareholders whose allocations did not satisfy their requests in
the priority identified above pro rata on the basis of the number of shares of
Registrable Securities and Other Shares, as applicable, that are held by such
Holders and other selling shareholders, as applicable, in each case assuming
conversion, and this procedure shall be repeated until all of the shares of
Registrable Securities and Other Shares which may be included in the
registration on behalf of the Holders and other selling shareholders shall have
been so allocated. The Company shall not limit the number of Registrable
Securities to be included in a registration pursuant to this Agreement in order
to include shares held by shareholders with no registration rights or to include
any shares of stock issued to employees, officers, directors or consultants
pursuant to the Company's stock option plan or any other employee benefit plan
(or, with respect to registrations under Sections 3.1 or 3.4 hereof, in order to
include in such registration securities registered for the Company's own
account).

     3.13 Delay of Registration. No Holder shall have any right to take any
action to restrain, enjoin or otherwise delay any registration as the result of
any controversy that might arise with respect to the interpretation or
implementation of this Section 3.

                                       17

<PAGE>

     3.14 Termination Rights. This Agreement shall terminate upon the earlier of
(a) the fifth anniversary of the consummation of the Company's Qualified IPO, or
(b) the closing of a Change of Control. In addition, a particular Holder's
registration rights shall expire if both (i) the Company's securities trade on a
national securities exchange or list on a national automatic quotation system,
and (ii) all Registrable Securities held by such Holder (and its affiliates) may
be sold pursuant to Rule 144 during any ninety (90) day period.

                                    SECTION 4

                                    COVENANTS

     4.1 Affirmative Covenants. The Company covenants and agrees that it will
(unless waived in whole or in part by the holders of at least a majority of the
then outstanding Shares) perform and observe the following covenants and
provisions, and will cause each Subsidiary, if and when such Subsidiary exists,
to perform and observe such of the following covenants and provisions as are
applicable to such Subsidiary:

          (a) The Company and each Subsidiary will pay and discharge all lawful
     taxes, assessments and governmental charges or levies imposed upon it or
     upon its income or property before the date on which penalties attach
     thereto, and all lawful claims which, if unpaid, would become a lien or
     charge on any properties of the Company or any Subsidiary; provided,
     however, that neither the Company nor any Subsidiary will be required to
     pay any tax, assessment, charge, levy or claim which is being contested in
     good faith and by appropriate proceedings if the Company or the Subsidiary
     will have set aside on its books reserves, if any, to the extent required
     by generally accepted accounting principles ("GAAP") with respect thereto.
     All transfer, excise or other taxes payable to any jurisdiction (in the
     United States and outside of the United States) or by reason of the sale or
     issuance of the Shares (except for such taxes payable by reason of any
     subsequent transfer of the Shares) shall be paid or provided for by the
     Company.

          (b) The Company shall maintain, or shall cause to be maintained valid
     policies of workers' compensation insurance and insurance with responsible
     and reputable insurance companies or associations in such amounts, types
     and covering such risks as are acceptable to the Board of Directors of the
     Company and are customarily carried by companies engaged in similar
     businesses and owning similar properties in the same general areas in which
     the Company or such Subsidiary operates, including, without limitation,
     directors and officers liability insurance and insurance against loss,
     damage, fire, theft, public liability, products liability, clinical trial
     liability and other risks.

          (c) The Company and each Subsidiary shall preserve and maintain its
     corporate existence, rights, franchises and privileges in the jurisdiction
     of its incorporation, and shall qualify and remain qualified, and cause
     each Subsidiary to qualify and remain qualified, as a foreign corporation
     in each jurisdiction in which such qualification is necessary or desirable
     in view of its business and operations or the ownership or lease of its
     properties, except where the failure to so preserve, maintain and qualify,
     individually or in the aggregate, would not have a Company Material Adverse
     Effect (as defined in the Series A Agreement). The Company shall, and shall
     cause each

                                       18

<PAGE>

     Subsidiary to, secure, preserve and maintain all Intellectual Property
     Assets (as defined in the Series A Agreement) owned or possessed by it,
     except where the failure to so secure, preserve and maintain such
     Intellectual Property Assets would not have a Company Material Adverse
     Effect.

          (d) The Company shall, at any time during normal business hours and
     upon reasonable prior notice to the Company, permit any Holder of at least
     600,000 (as adjusted for any stock dividends, combinations, splits,
     recapitalizations and the like) Shares (a "MAJOR HOLDER"), or its
     designated representative, to (i) visit and inspect the premises and any of
     the properties of the Company and any Subsidiary, including its records and
     books of account (and make copies thereof and take extracts therefrom), and
     (ii) discuss the affairs, finances and accounts of the Company and any
     Subsidiary with its officers, directors, employees and accountants, all at
     the expense of such Major Holder; provided, that the Company shall not be
     obligated under this Section 4.1(d) with respect to information whose
     disclosure would adversely affect attorney-client privilege with respect to
     such information; provided, further, that the Company shall not be
     obligated under this Section 4.1(d) with respect to any information which
     the Board of Directors determines in good faith is confidential and should
     not be disclosed unless the applicable Major Holder executes a
     confidentiality agreement in form and substance reasonably acceptable to
     the Company. Subject to the foregoing restrictions, the disclosure of
     information to a Major Holder's representative shall be permitted so long
     as the Major Holder informs such representatives that the information is
     confidential and subject to an ongoing obligation to keep such information
     confidential.

          (e) The Company will use reasonable efforts to provide to each Major
     Holder written notice of any litigation or government proceeding or
     investigation pending or threatened against the Company or any Subsidiary,
     or against any of their respective officers, directors, persons in charge
     of a principal business function, or other individuals designated by the
     Board of Directors of the Company as a key employee, or principal
     shareholder of the Company or any Subsidiary, in each case with potential
     liability in excess of $1,000,000, promptly after receiving written notice
     of the foregoing. In addition, the Company shall promptly notify the
     Investors if at any time the Company does not have sufficient operating
     capital to operate the Company in a manner similar to its then current
     operations for a period of at least sixty (60) days.

          (f) The Company will require each person now or hereafter employed by
     or providing consulting services to the Company or any Subsidiary with
     access to confidential and proprietary information of the Company to enter
     into a non-disclosure and proprietary rights assignment agreement
     substantially in the form approved by the Board of Directors (or, with
     respect to consultants, such other form or forms containing proprietary
     information and confidentiality obligations consistent with industry
     practices).

          (g) The Company and each Subsidiary shall keep adequate records and
     books of account in which complete entries will be made in accordance with
     GAAP with respect to all financial transactions of the Company and any
     Subsidiary, and in which, for each fiscal year, all proper reserves for
     depreciation, depletion, returns of merchandise,

                                       19

<PAGE>

     obsolescence, amortization, taxes, bad debts and other purposes in
     connection with its business shall be made.

          (h) At least 30 days prior to the commencement of each fiscal year,
     the Company will prepare and submit to, and obtain in respect thereof the
     approval from the Board of Directors, the operating budgets, operating
     expenses, profit and loss projections, cash flow projections and a capital
     expenditure budget (the "ANNUAL BUDGET") for the succeeding fiscal year.
     Promptly after it is approved by the Board, a copy of the Annual Budget
     shall be provided to each Major Holder.

          (i) The Company will, upon any increase in the number of shares of
     Common Stock issuable upon conversion of outstanding Series A Shares,
     reserve additional shares of Common Stock for issuance upon such
     conversion, so that the number of shares of Common Stock so reserved will
     not at any time be less than the number of such shares issuable upon such
     conversion.

          (j) The Company will take such actions as are necessary to ensure that
     all Patents (as defined in the Series A Agreement) owned by the Company are
     kept in force and maintained in compliance with formal legal requirements
     (including payment of required filing, examination and maintenance fees and
     filing of required proofs of working or use), unless otherwise determined
     by the Board of Directors in advance of the failure to take any such
     actions with respect to any particular Patent.

          (k) The Company hereby agrees to provide prompt notice to Major Holder
     following any "determination date" (as defined in Treasury Regulation
     Section 1.897-2(c)(1)) on which the Company becomes a United States real
     property holding corporation. In addition, upon a written request by a
     Major Holder, the Company shall provide such Major Holder with a written
     statement informing the Major Holder whether the Major Holder's interest in
     the Company constitutes a United States real property interest. The
     Company's determination shall comply with the requirements of Treasury
     Regulation Section 1.897-2(h)(1) or any successor regulation, and the
     Company shall provide timely notice to the Internal Revenue Service, in
     accordance with and to the extent required by Treasury Regulation Section
     1.897-2(h)(2) or any successor regulation, that such statement has been
     made. The Company's written statement to a Major Holder shall be delivered
     to the Major Holder within 10 days of the Major Holder's written request
     therefor.

     4.2 Financial Statements and Other Information. The Company will (unless
waived in whole or in part by the holders of at least a majority of the then
outstanding Shares) deliver to each Major Holder, individually or collectively
with its affiliates, copies of the following:

          (a) As soon as practicable, but in any event within 120 days after the
     end of each fiscal year of the Company (beginning with the 2006 fiscal
     year), (i) audited balance sheets of the Company as at the end of such
     year, together with audited statements of income and retained earnings and
     statements of cash flows of the Company for such year, together with notes
     related thereto, each prepared in accordance with GAAP, consistently
     applied, and setting out in each case in comparative form the figures for
     the previous

                                       20

<PAGE>

     fiscal year, all in reasonable detail and certified by certified
     independent public accountants of established national reputation selected
     by the Board of Directors of the Company or the audit committee thereof,
     and (ii) a report of the principal financial officer of the Company
     containing a management discussion and analysis of the Company's
     consolidated financial condition at the end of such year and the results of
     operations for such year, including, but not limited to, a description of
     significant events with respect to the Company and its Subsidiaries, if
     any, during the preceding year and any planned or anticipated significant
     activities or events during the next fiscal quarter; and

          (b) As soon as practicable, but in any event within 45 days after the
     end of each of the first three fiscal quarters of the Company in each year,
     an unaudited balance sheet at the end of such quarter, and unaudited
     statements of profit and loss, of changes in financial condition and of
     cash flow for such period and for the current fiscal year to date, and
     comparisons to the Annual Budget (as defined below) and to corresponding
     periods for prior fiscal years, in each case prepared in accordance with
     GAAP, consistently applied (other than for accompanying notes and subject
     to changes resulting from year-end audit adjustments).

The foregoing financial statements shall be prepared on a consolidated basis if
the Company then has any Subsidiaries.

     4.3 Negative Covenants of the Company. The Company agrees that it will not
take the following actions without the prior affirmative vote or prior written
consent of the holders of at least a majority of the then outstanding Shares:

          (a) Effect or permit any Change of Control.

          (b) Increase or decrease the maximum number of directors authorized on
     the Company's Board of Directors without the unanimous consent of all
     directors then serving on the Board of Directors.

          (c) Amend or repeal any provision of, or add any provision to, the
     Bylaws in a manner that adversely affects the Series A Preferred Stock or
     otherwise adversely alters or changes the rights, preferences or privileges
     of the Series A Preferred Stock or the holders thereof.

          (d) Amend or repeal any provision of, or add any provision to, the
     Articles, or file any certificate of designation thereunder.

          (e) Take any action that alters the rights, preferences or privileges
     of the Series A Preferred Stock or any other preferred stock of the
     Company.

          (f) Create, authorize, designate or issue any other class or series of
     capital stock with preferences, rights, privileges or powers superior to or
     on a parity with those of the Series A Preferred Stock.

                                       21

<PAGE>

          (g) Apply any of its assets to the redemption, retirement, purchase or
     acquisition, directly or indirectly, through Subsidiaries or otherwise, of
     any shares of its capital stock (except (i) repurchases of unvested shares
     at the original purchase price upon termination of employment of employees
     or consultants holding restricted stock, (ii) repurchases of shares
     pursuant to the express terms of any option plan approved by the Board of
     Directors, or (iii) repurchases pursuant to the Company's exercise of a
     right of first refusal contained in agreements approved by the Board of
     Directors).

          (h) Commence voluntary or involuntary liquidation, dissolution or
     winding up proceedings.

          (i) Increase or decrease the number of authorized shares of Common
     Stock or Preferred Stock.

          (j) Effect any recapitalization or reclassification of shares of
     outstanding capital stock.

          (k) Pay or declare any dividend or distribution on any shares of its
     capital stock (except stock dividends payable solely in shares of Common
     Stock).

          (l) Enter into any contract, agreement or understanding relating to
     the employment, separation or termination of any officer, employee or
     consultant of the Company calling for the payment of any sums or other
     benefits in connection with (or for periods after) the termination or
     separation of such officer's, employee's or consultant's relationship with
     the Company, in each case unless either (i) approved by a majority of the
     non-employee directors then serving on the Board of Directors, (ii)
     pursuant to an employment or separation policy approved by the Board of
     Directors and which applies to employees generally, or (iii) the total of
     all sums and other benefits payable pursuant to such contract, agreement or
     understanding does not exceed $20,000.

          (m) Amend any contract, agreement or understanding relating to the
     employment, separation or termination of any officer, employee or
     consultant of the Company in any material respect, in each case unless
     approved by a majority of the disinterested directors then serving on the
     Board of Directors, either (i) approved by a majority of the non-employee
     directors then serving on the Board of Directors, (ii) pursuant to an
     employment or separation policy approved by the Board of Directors and
     which applies to employees generally, or (iii) after such amendment the
     total of all sums and other benefits payable pursuant to such contract,
     agreement or understanding do not exceed $20,000.

          (n) Effect an initial public offering that is not a Qualified IPO.

          (o) Enter into any material contract, agreement or understanding with
     an affiliate of the Company (other than a wholly-owned subsidiary of the
     Company) or with an officer, director or shareholder of the Company (or any
     of their affiliates) unless (i) it relates to the employment, separation or
     termination of any officer, employee or consultant of the Company and is
     permitted (or approved) pursuant to the other terms of this Section 4.3, or
     (ii) is approved by the disinterested directors on the Board of

                                       22

<PAGE>

     Directors after disclosure to them of the potential conflict of interest
     and of the terms of such contract, agreement or understanding.

          (p) Incur or suffer to exist in excess of $4,000,000 of indebtedness
     for borrowed monies in the aggregate, at any given time, that is secured by
     any of the assets of the Company.

          (q) Make any commitment or binding obligation to take any action that
     would be prohibited under this Section 4.3.

          (r) Allow any Subsidiary to take any action (or make a commitment or
     binding obligation to take any action) that would be prohibited under this
     Section 4.3 if taken by the Company.

     4.4 Foreign Registrations. If the Company elects to register or achieve a
public listing of the Common Stock outside the United States before its initial
public offering in the United States, the Holders of a majority of the
Registrable Securities may require the parties to appropriately adjust the terms
of this Agreement in good faith to provide the Holders with rights to register,
list and sell the Registrable Securities in such jurisdiction that are at least
as favorable as those contemplated in this Agreement. Without limiting the
generality of the foregoing, the restrictions under Section 3.11 as to when the
Holders may sell or otherwise transfer or dispose of any Registrable Securities
will, if appropriate, be shortened or eliminated taking into account the rules,
regulations and standard procedures of the jurisdiction and the applicable stock
exchange, and shall be subject to the written approval of Investors holding a
majority of the Registrable Securities (the "INVESTOR MAJORITY"). Any written
agreement of the Investor Majority and the Company as contemplated above shall
be binding on all Holders. Without limiting the generality of the foregoing, the
parties hereto acknowledge that in connection with any such written agreement
the Investor Majority may (but shall not be required to) condition their
approval upon the Company agreeing to take such steps, if any, as are necessary
or desirable to ensure that the Registrable Securities are freely tradable on
the foreign exchange after the applicable restricted period, if any, expires.

     4.5 Reincorporation Transaction. If at any time, in anticipation of a
registered initial public offering of Common Stock, an Investor Majority deems
it in the best interests of the Company and its shareholders to reincorporate
the Company as a Delaware corporation (including by means of a merger,
conversion, consolidation or other reorganization of the Company into or with a
Delaware corporation), each party hereto will take such steps to effect such
reincorporation, merger, conversion, consolidation or other reorganization as
may be requested by the Investor Majority, including transferring or tendering
such party's shares in the Company in exchange or consideration for shares of
capital stock of the Delaware corporation, provided that no party will be
required to take any steps which would have a material adverse effect on the
rights or economic interests of such party which are materially different from
the effects of such steps on other parties.

     4.6 Termination. All obligations of the Company under Sections 4.1, 4.2,
4.3, 4.4 and 4.5 shall terminate upon the earlier of the consummation of a
Qualified IPO or a Change of Control.

                                       23

<PAGE>

                                    SECTION 5

                                  MISCELLANEOUS

     5.1 Governing Law; Jurisdiction; Venue; No Jury Trial. This Agreement shall
be governed by and construed in accordance with the laws of the State of
Washington and the laws of the United States applicable therein (in each case
without giving effect to any choice or conflict of laws provision or rule that
would cause the application of the laws of any other jurisdiction) and shall be
treated in all respects as a Washington contract. Any action, suit or proceeding
arising out of or relating to this Agreement shall be brought in the state
courts of the State of Washington located in King County, or, if it has or can
acquire jurisdiction, any Federal court located in such State and County, and
EACH OF THE PARTIES HERETO, AFTER CONSULTING WITH OR HAVING HAD THE OPPORTUNITY
TO CONSULT WITH COUNSEL, HEREBY KNOWINGLY, VOLUNTARILY, INTENTIONALLY AND
IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF SUCH COURTS AND WAIVES
TRIAL BY JURY, IN EACH CASE IN CONNECTION WITH ANY ACTION, SUIT OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT. Each of the parties hereto hereby
irrevocably and unconditionally waives any objection to the laying of venue of
any action, suit or proceeding arising out of or relating to this Agreement or
the transactions contemplated hereby in the courts of the State of Washington or
the United States of America, in each case located in King County, and hereby
further irrevocably and unconditionally waives and agrees not to plead or claim
in any such court that any such matter brought in any such court has been
brought in an inconvenient forum.

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

     5.3 Entire Agreement; Amendment. This Agreement constitutes the full and
entire understanding and agreement between the parties with regard to the
subjects hereof. Neither this Agreement nor any term hereof may be amended,
discharged or terminated, except by a written instrument signed by the Company
and the holders of at least fifty percent (50%) of the Registrable Securities;
provided, that no such amendment shall increase the number of Shares required to
qualify as a "Major Holder" without the consent of each Major Holder that holds
fewer Shares than the proposed higher threshold. Any such amendment, discharge
or termination shall be binding on all the Holders, but in no event shall the
obligation of any Holder hereunder be materially increased, except upon the
written consent of such Holder.

     5.4 Notices. All notices, requests, consents, and other communications
under this Agreement shall be in writing and shall be deemed delivered (a) three
business days after being sent by registered or certified mail, return receipt
requested, postage prepaid, (b) one business day after being sent via a
reputable nationwide overnight courier service guaranteeing next business day
delivery or (c) upon delivery when sent by facsimile (with confirmation of
receipt), in each case to the intended recipient at the address indicated for
such party on the signature page or Schedules hereto, as applicable, or at such
other address as such party may designate by ten (10) days' advance written
notice to the other parties.

                                       24

<PAGE>

     5.5 Delays or Omissions; Waiver. No delay or omission to exercise any
right, power or remedy accruing to any Holder upon any breach or default of the
Company under this Agreement shall impair any such right, power or remedy of
such Holder, nor shall it be construed to be a waiver of any such breach or
default, or an acquiescence therein, or of or in any similar breach or default
thereafter occurring; nor shall any waiver of any single breach or default be
deemed a waiver of any other breach or default theretofore or thereafter
occurring. Any waiver, permit, consent or approval of any kind or character on
the part of any Holder or the Company of any breach or default under this
Agreement or any waiver on the part of the Company or any Holder of any
provisions or conditions of this Agreement must be made in writing and shall be
effective only to the extent specifically set forth in such writing. All
remedies, either under this Agreement or by law or otherwise afforded to any
Holder or the Company, shall be cumulative and not alternative.

     5.6 Rights; Separability. Unless otherwise expressly provided herein, a
Holder's rights hereunder are several rights, not rights jointly held with any
of the other Holders. In case any provision of the Agreement shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.

     5.7 Information Confidential. Notwithstanding anything to the contrary in
this Agreement (i) no Holder by reason of this Agreement shall have access to
any classified information of the Company, (ii) no Holder by reason of this
Agreement shall have access to any trade secrets of the Company unless such
Holder executes a confidentiality agreement in form and substance reasonably
acceptable to the Company, and (iii) notwithstanding the preceding clause (ii)
the Company shall not be required to provide confidential or proprietary
information (or access thereto) pursuant to this Agreement to any Holder whom
the Company's Board of Directors reasonably determines to be a competitor of the
Company (it being agreed that a financial investor, including Johnson & Johnson
Development Corporation ("JJDC"), shall not be deemed a competitor if it has an
investment in a competitor representing not more than 50% of such competitor's
outstanding voting securities, regardless of whether such investor has one or
more seats on such competitor's board of directors). Notwithstanding anything to
the contrary herein, JJDC covenants and agrees that it will not provide any
confidential or proprietary information to any affiliate of JJDC. Each Holder
acknowledges that the information received by it pursuant hereto may be
confidential and for such Holder's use only, and such Holder will not use such
confidential information in violation of the Exchange Act or reproduce, disclose
or disseminate such information to any other person (other than its employees,
directors, affiliates, or agents having a need to know the contents of such
information, and its attorneys), except in connection with the exercise of
rights under this Agreement, unless the Company has made such information
available to the public generally or such Holder is required to disclose such
information by a governmental body. The Holders' obligations under this Section
5.7 shall survive the termination of this Agreement.

     5.8 Titles and Subtitles. The titles of the paragraphs and subparagraphs of
this Agreement are for convenience of reference only and are not to be
considered in construing or interpreting this Agreement.

                                       25

<PAGE>

     5.9 Aggregation of Stock. All shares of Registrable Securities held or
acquired by Holders and its transferees, if any, shall be aggregated together
for the purpose of determining the availability of any rights under the
Agreement.

     5.10 Counterparts. This Agreement may be executed in any number
counterparts, including by facsimile copy, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]

                                       26

<PAGE>

     IN WITNESS WHEREOF, the parties hereto have executed this Investors Rights
Agreement effective as of the Effective Date.

THE COMPANY:                            LIGHT SCIENCES ONCOLOGY, INC.

                                        By: /s/ Llew Keltner
                                            ------------------------------------
                                        Its: President and Chief Executive
                                             Officer

                                        Address:
                                                 -------------------------------
                                        Fax No:
                                                --------------------------------

FOUNDERS:

                                        LIGHT SCIENCES CORPORATION

                                        By: /s/ Albert Luderer
                                            ------------------------------------
                                        Its: CEO

INVESTORS:

                                        ESSEX WOODLANDS HEALTH VENTURES FUND VI,
                                        L.P.

                                        By: Essex Woodlands Health Ventures VI,
                                            L.P.
                                        Its: General Partner

                                        By: Essex Woodlands Health Ventures VI,
                                            L.L.C.
                                        Its: General Partner

                                        By: /s/ Jeff Himawan
                                            ------------------------------------
                                            Dr. Jeff Himawan, Managing Director

<PAGE>

                                   SCHEDULE I

                                    FOUNDERS

<TABLE>
<CAPTION>
Founder Name and Address     Shares of Common Stock Held
------------------------     ---------------------------
<S>                          <C>
Light Sciences Corporation            7,743,040
                                      ---------
TOTAL                                 7,743,040
                                      =========
</TABLE>

<PAGE>

                                   SCHEDULE II

                                    INVESTORS

<TABLE>
<CAPTION>
Investor Name and Address                      Series A Shares Held
-------------------------                      --------------------
<S>                                            <C>
ESSEX WOODLANDS HEALTH VENTURE FUND VI, L.P.         3,200,000
CRAIG WATJEN                                         1,424,989
ADAMS STREET V, L.P.                                 1,000,000
CHINA DEVELOPMENT INDUSTRIAL BANK, INC.                400,000
EDWARD AVEDISIAN                                       200,000
HSIU-CHUAN LEE                                          20,000
JOHNSON & JOHNSON DEVELOPMENT CORPORATION              800,000
                                                     ---------
TOTAL                                                7,044,989
                                                     =========
</TABLE>

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