Document:

Bernd Thomas Herrmann

EXHIBIT 10.25

Bernd Thomas Herrmann

371 Avenue des Papalins

MC -98000 Monaco

Personal Undertaking ("Undertaking")

towards

Integrated Surgical Systems, Inc.

1850 Research Park Drive

Davis, CA 95616

USA

WHEREAS, the undersigned has purchased a warrant to purchase 2.925.000 shares of Common Stock of Integrated Surgical Systems, Inc., Davis, CA, USA ("ISS") on December 14,1999 (the "Warrant"); and

WHEREAS, in view of the fact that the undersigned has declined to participate in the next round of financing in ISS; and

WHEREAS, the undersigned intends to resign from the Board of ISS effective June 10, 2000 and will reduce his personal attention and contributions to ISS to that of a mere financial investor;

NOW, THEREFORE, the undersigned herewith irrevocably makes the following Undertaking:

1. The undersigned herewith irrevocably and unconditionally waives any rights and claims

he may have under the Warrant with regard to the purchase of an aggregate of 1.425.000 shares of Common Stock of ISS. The undersigned directs ISS to cancel the Warrant delivered with this Undertaking as to 1.425.000 shares and to reissue to the
undersigned until June 30, 2000 at the latest, new warrants ("New Warrants") to purchase the remaining 1.5 million shares as follows:

one warrant to purchase 1 million shares;

four warrants, each to purchase 125.000 shares.

The New Warrants shall have the same terms and conditions as the Warrant except as

set forth in para 2. below.

2. The undersigned further irrevocably undertakes to exercise his right to purchase the following amount of shares of Common Stock of ISS under the New Warrants at any time prior to the respective following dates at a purchase price of 1.02656 USD
provided, that the quoted 5-day-average NASDAQ stock price for ISS Common Stock is at least 1.03 USD per share of Common Stock prior to exercise of the New Warrants:

By not later than September 5, 2000 - 125.000 shares of Common Stock

By not later than October 5,2000 - an additional 125.000 shares of Common Stock

By not later than November 5, 2000 - an additional 125.000 shares of Common Stock 

By not later than December 5, 2000 - an additional 125.000 shares of Common Stock.

Any New Warrants that are to be exercised as above shall automatically expire in case they are not exercised upon the respective above dates.

With regard to the balance of 1.000.000 shares of Common Stock of ISS the terms and conditions of the New Warrants shall fully apply and the undersigned shall not be subject to any further restrictions or obligations except those set forth in the New
Warrants.

3. This Undertaking shall be subject to Californian law without regard to its conflict of laws provisions. Exclusive place of jurisdiction shall be Zurich, Switzerland. This Undertaking constitutes the entire Undertaking of the undersigned regarding
the subject matter hereof.

Monaco, May l6, 2000

Bernd Thomas HerrmannPRIVATE EQUITY LINE OF CREDIT AGREEMENT

EXHIBIT 10.26

PRIVATE EQUITY LINE OF CREDIT AGREEMENT

between

Integrated Surgical Systems, Inc.

and

Triton West Group, Inc.

PRIVATE EQUITY LINE OF CREDIT AGREEMENT dated as of September 15,
2000 (the "Agreement"), between Integrated Surgical Systems, Inc., a
corporation organized and existing under the laws of the State of Delaware (the
"Company"), and Triton West Group, Inc., a corporation organized and
existing under the laws of the Cayman Islands (the "Investor").

WHEREAS, the Investor desires to purchase from the
Company, and the Company is willing to sell to the Investor, from time to time,
up to $12,000,000 (the "Aggregate Purchase Price") of the Company's
common stock, par value $.01 per share (the "Common Stock"), on the
terms and subject to the conditions set forth in this Agreement; 

WHEREAS, such investments will be made by the Investor
as a statutory underwriter of a registered indirect primary offering of such
Common Stock by the Company; 

NOW, THEREFORE, the parties hereto agree as
follows:

ARTICLE I

Certain Definitions

Section 1.1"Bid Price" shall mean
the closing bid price (as reported by Bloomberg L.P.) of the Common Stock on the
Principal Market.

Section 1.2"Capital Shares" shall mean
the Common Stock and any shares of any other class of common stock whether now
or hereafter authorized, having the right to participate in the distribution of
earnings and assets of the Company.

Section 1.3"Capital Shares Equivalents"
shall mean any securities, rights, or obligations that are convertible into or
exchangeable for or give any right to subscribe for any Capital Shares of the
Company or any warrants, options or other rights to subscribe for or purchase
Capital Shares or any such convertible or exchangeable securities.

Section 1.4"Closing" shall mean one of
the closings of a purchase and sale of the Common Stock pursuant to Section
2.1.

Section 1.5"Closing Date" shall mean,
with respect to a Closing, the seventh Trading Day following the Put Date
related to such Closing, provided all conditions to such Closing have been
satisfied on or before such Trading Day.

Section 1.6"Commitment Amount" shall
mean the $12,000,000 up to which the Investor has agreed to provide to the
Company in order to purchase the Put Shares pursuant to the terms and conditions
of this Agreement.

Section 1.7"Commitment Period" shall
mean the period commencing on the Effective Date and expiring on the earliest to
occur of (x) the date on which the Investor shall have purchased Put Shares
pursuant to this Agreement for an aggregate Purchase Price of $12,000,000, (y)
the date this Agreement is terminated pursuant to Section 2.4, or (z) the date
occurring three years from the date of commencement of the Commitment
Period.

Section 1.8 "Common Stock" shall mean
the Company's common stock, par value $.01 per share.

Section 1.9 "Condition Satisfaction
Date" shall have the meaning set forth in Section 7.2.

Section 1.10 "Effective Date" shall mean the
date on which the SEC first declares effective a Registration Statement
registering the sale by the Company and resale by the Investor of the
Registrable Securities as set forth in Section 7.2(e).

Section 1.11 "Escrow Agent" shall mean the
escrow agent designated in the Escrow Agreement.

Section 1.12 "Escrow Agreement" shall mean
the escrow agreement in the form attached hereto as Exhibit A.

Section 1.13"Exchange Act" shall mean the
Securities Exchange Act of 1934, as amended, and the rules and regulations
promulgated thereunder.

Section 1.14 "Investment Amount" shall mean
the total dollar amount to be invested by the Investor to purchase Put Shares
with respect to any Put Date as notified by the Company to the Investor, all in
accordance with Section 2.2 hereof.

Section 1.15 "Market Price" on any given
date shall mean the lowest Bid Price (as reported by Bloomberg L.P.) of the
Common Stock during the Valuation Period relating to such date.

Section 1.16 "Material Adverse Effect" shall
mean any effect on the business, operations, properties, prospects, or financial
condition of the Company that is material and adverse to the Company and its
subsidiaries and affiliates, taken as a whole, and/or any condition,
circumstance, or situation that would prohibit or otherwise interfere with the
ability of the Company to enter into and perform any of its obligations under
this Agreement, the Registration Rights Agreement or the Escrow Agreement in any
material respect.

Section 1.17 "Maximum Put Amount" shall mean
the amount indicated by the following table:

	

Stock Bid Price
	
15,000-50,000 Avg. 30 Trading Day
Volume
	
50,001-100,000 Avg. 30 Trading Day
Volume
	
100,001-150,000 Avg. 30 Trading Day
Volume
	
150,001-Above Avg. 30 Trading Day
Volume

	
 $0.50-1.00   
	
$400,000
	
$400,000
	
$600,000
	
$600,000

	
1.00-3.00
	
$500,000
	
$500,000
	
$750,000
	
$750,000

	
3.01-4.50
	
$500,000
	
$750,000
	
$750,000
	
$1,000,000

	
4.51-6.00
	
$750,000
	
$750,000
	
$1,000,000
	
$1,000,000

	
6.01-7.50
	
$750,000
	
$1,000,000
	
$1,000,000
	
$1,250,000

	
7.51-9.00
	
$1,000,000
	
$1,000,000
	
$1,250,000
	
$1,250,000

	
9.01-Above
	
$1,000,000
	
$1,250,000
	
$1,250,000
	
$1,500,000

If the Bid Price or the thirty-day average trading volumes
shall be less than the parameters set forth in the foregoing table, the Maximum
Put Amount shall be $250,000.

Section 1.18 "NASD" shall mean the National
Association of Securities Dealers, Inc.

Section 1.19 "Outstanding" when used with
reference to shares of Common Stock or Capital Shares (collectively the
"Shares"), shall mean, at any date as of which the number of such
Shares is to be determined, all issued and outstanding Shares, and shall include
all such Shares issuable in respect of outstanding scrip or any certificates
representing fractional interests in such Shares; provided,
however, that "Outstanding" shall not mean any such Shares then
directly or indirectly owned or held by or for the account of the Company.

Section 1.20 "Person" shall mean an
individual, a corporation, a partnership, an association, a trust or other
entity or organization, including a government or political subdivision or an
agency or instrumentality thereof.

Section 1.21 "Principal Market" shall mean
the NASDAQ National Market, the NASDAQ SmallCap Market, the American Stock
Exchange, the New York Stock Exchange or the OTC Bulletin Board, whichever is at
the time the principal trading exchange or market for the Common Stock.

Section 1.22 "Purchase Price" shall mean
with respect to Put Shares, eight-eight percent (88%) of the Market Price for
the Valuation Period applicable to a Put Date (or such other date on which the
Purchase Price is calculated in accordance with the terms and conditions of this
Agreement). 

Section 1.23 "Put" shall mean each occasion
the Company elects to exercise its right to tender a Put Notice requiring the
Investor to purchase shares of Common Stock, subject to the terms of this
Agreement.

Section 1.24 "Put Date" shall mean the
Trading Day during the Commitment Period that a Put Notice to sell Common Stock
to the Investor is deemed delivered pursuant to Section 2.2(b) hereof.

Section 1.25 "Put Notice" shall mean a
written notice to the Investor setting forth the Investment Amount that the
Company intends to sell to the Investor in the form attached hereto as Exhibit
B.

Section 1.26 "Put Shares" shall mean all
shares of Common Stock or other securities issued or issuable pursuant to a Put
that has occurred or may occur in accordance with the terms and conditions of
this Agreement.

Section 1.27 "Registrable Securities" shall
mean the Put Shares and Warrant Shares  until (i) all Put Shares and Warrant
Shares have been disposed of pursuant to the Registration Statement, (ii) all
Put Shares and Warrant Shares have been sold under circumstances under which all
of the applicable conditions of Rule 144 (or any similar provision then in
force) under the Securities Act ("Rule 144") are met, (iii) all Put
Shares and Warrant Shares have been otherwise transferred to persons who may
trade such shares without restriction under the Securities Act, and the Company
has delivered a new certificate or other evidence of ownership for such
securities not bearing a restrictive legend or (iv) such time as, in the opinion
of counsel to the Company, all Put Shares and Warrant Shares may be sold without
any time, volume or manner limitations pursuant to Rule 144(k) (or any similar
provision then in effect) under the Securities Act.

Section 1.28 "Registration Rights
Agreement" shall mean the registration rights Agreement between the
Company and the Investor in the form of Exhibit D attached hereto.

Section 1.29"Registration Statement"
shall mean the Company's registration statement on Form SB-2, and any subsequent
Form SB-2 (if use of such form is then available to the Company pursuant to the
rules of the SEC and, if not, on such other form promulgated by the SEC, for
which the Company then qualifies and which counsel for the Company shall deem
appropriate, and which form shall be available for the resale by the Investor of
the Registrable Securities to be registered thereunder in accordance with the
provisions of this Agreement, and in accordance with the intended method of
distribution of such securities), for the registration of the resale by the
Investor of the Registrable Securities under the Securities Act.

Section 1.30   "SEC" shall mean the
Securities and Exchange Commission.

Section 1.31"Securities Act" shall have
the meaning set forth in the recitals of this Agreement.

Section 1.32  "SEC Documents" shall mean the
Company's latest Form 10-K or 10-KSB as of the time in question, all
Forms 10-Q or 10-QSB and 8-K filed thereafter, and the Proxy Statement for
its latest fiscal year as of the time in question until such time as the Company
no longer has an obligation to maintain the effectiveness of a Registration
Statement.

Section 1.33  Trading Cushion" shall mean the
mandatory fifteen (15) Trading Days between Put Dates.

Section 1.34  "Trading Day" shall mean any
day during which the Principal Market shall be open for business.

Section 1.35  "Valuation Event" shall mean an event in which
the Company at any time after the date of this Agreement and prior to the end of
the Commitment Period takes any of the following actions:

	subdivides or combines its Common Stock;

	pays a dividend in its Capital Stock or makes any other
distribution of its Capital Shares;

	issues any additional Capital Shares ("Additional
Capital Shares"), otherwise than as provided in the foregoing Subsections
(a) and (b) above or (d) and (e) below, at a price per share less, or for other
consideration lower, than the Bid Price in effect immediately prior to such
issuance, or without consideration (other than pursuant to this
Agreement);

	issues any warrants, options or other rights to subscribe
for or purchase any Additional Capital Shares and the price per share for which
Additional Capital Shares may at any time thereafter be issuable pursuant to
such warrants, options or other rights shall be less than the Bid Price in
effect immediately prior to such issuance;

	issues any securities convertible into or exchangeable
for Capital Shares and the consideration per share for which Additional Capital
Shares may at any time thereafter be issuable pursuant to the terms of such
convertible or exchangeable securities shall be less than the Bid Price in
effect immediately prior to such issuance;

	makes a distribution of its assets or evidences of
indebtedness to the holders of its Capital Shares as a dividend in liquidation
or by way of return of capital or other than as a dividend payable out of
earnings or surplus legally available for dividends under applicable law or any
distribution to such holders made in respect of the sale of all or substantially
all of the Company's assets (other than under the circumstances provided for in
the foregoing subsections (a) through (e); or

	takes any action affecting the number of Outstanding
Capital Shares, other than an action described in any of the foregoing
Subsections (a) through (f) hereof, inclusive, which in the opinion of the
Company's Board of Directors, determined in good faith, would have a Material
Adverse Effect upon the rights of the Investor at the time of a
Put.

Section 1.36 "Valuation Period" shall mean
the period of nine (9) Trading Days during which the Purchase Price of the
Common Stock is valued, which period shall be with respect to the Purchase Price
on any Put Date, the two (2) Trading Days immediately preceding and the six (6)
Trading Days following the Trading Day on which a Put Notice is deemed to be
delivered, as well as the Trading Day on which such notice is deemed to be
delivered; provided, however, that if a Valuation Event occurs during a
Valuation Period, a new Valuation Period shall begin on the Trading Day
immediately after the occurrence of such Valuation Event and end on the sixth
Trading Day thereafter.

Section 1.37"Warrants" shall mean
warrants to purchase up to 35,000 shares of Common Stock to be issued to Triton
upon execution of this Agreement, in the form of Exhibit D hereto.  The Warrants
shall be exercisable for a period of three years commencing six months after the
date of this Agreement at an initial exercise price equal to 125% of the Market
Price determined as of the date of this Agreement.

Section 1.38 "Warrant Shares"  shall
mean the shares of Common Stock issuable upon exercise of the Warrants.

ARTICLE II

Purchase and Sale of Common Stock

	Investments.

	Puts.  Upon the terms and conditions set forth
herein (including, without limitation, the provisions of Article VII hereof), on
any Put Date the Company may make a Put by the delivery of a Put Notice. The
number of Put Shares that the Investor shall purchase pursuant to such Put shall
be determined by dividing the Investment Amount specified in the Put Notice by
the Purchase Price on such Put Date, which amount shall not exceed the Maximum
Put Amount on such date.  

	Maximum Aggregate Amount of Puts.  Anything in
this Agreement to the contrary notwithstanding, (i) at no time will the Company
request a Put which would result in the issuance of an aggregate number of
shares of Common Stock pursuant to this Agreement which exceeds 19.9% of the
number of shares of Common Stock issued and outstanding on any Closing Date
without obtaining stockholder approval of such excess issuance, and (ii) the
Company may not make a Put to the extent that, after such purchase by the
Investor, the sum of the number of shares of Common Stock and Warrants
beneficially owned by the Investor and its affiliates would result in beneficial
ownership by such Investor and its affiliates of more than 4.9% of the then
outstanding shares of Common Stock.  For purposes of the immediately preceding
sentence, beneficial ownership shall be determined in accordance with
Section 13(d) of the Exchange Act.

	Mechanics. 

	Put Notice.  At any time during the Commitment
Period, the Company may deliver a Put Notice to the Investor, subject to the
conditions set forth in Section 7.2; provided, however, that the Investment
Amount for each Put as designated by the Company in the applicable Put Notice
shall be neither less than $100,000 nor more than the Maximum Put
Amount.

	Date of Delivery of Put Notice.  A Put Notice
shall be deemed delivered on (i) the Trading Day it is received by facsimile or
otherwise by the Investor if such notice is received prior to 12:00 noon Eastern
Time, or (ii) the immediately succeeding Trading Day if it is received by
facsimile or otherwise after 12:00 noon Eastern Time on a Trading Day or at any
time on a day which is not a Trading Day.  No Put Notice may be deemed delivered
on a day that is not a Trading Day.

	Closings.  On or before each Closing Date for
a Put (i) the Company shall arrange for its transfer agent to deliver the Put
Shares to be purchased by the Investor pursuant to Section 2.1 herein to the
Depository Trust Company ("DTC") brokerage account specified by the
Investor if the Company has been notified in writing that the Investment Amount
is held by the Escrow Agent and (ii) the Investor shall deliver the Investment
Amount specified in the Put Notice by wire transfer of immediately available
funds to the Escrow Agent on or before the Closing Date.  In addition, on or
prior to each Closing Date, each of the Company and the Investor shall deliver
to the Escrow Agent all documents, instruments and writings required to be
delivered or reasonably requested by either of them pursuant to this Agreement
in order to implement and effect the transactions contemplated herein. Payment
of funds to the Company shall occur out of escrow in accordance with the Escrow
Agreement; provided, however, that to the extent the Company has not paid the
fees, expenses, and disbursements of the Investor's counsel in accordance with
Section 14.7, the amount of such fees, expenses, and disbursements shall be paid
in immediately available funds, at the direction of the Investor, to Investor's
counsel with no reduction in the number of Put Shares issuable to the Investor
on such Closing Date.

	Termination of Investment Obligation.  The
obligation of the Investor to purchase shares of Common Stock shall terminate
permanently (including with respect to a Closing Date that has not yet occurred)
in the event that (i) there shall occur any stop order or suspension of the
effectiveness of the Registration Statement for an aggregate of twenty (20)
Trading Days during the Commitment Period, for any reason other than deferrals
or suspensions in accordance with the Registration Rights Agreement as a result
of corporate developments subsequent to the Effective Date that would require
such Registration Statement to be amended to reflect such event in order to
maintain its compliance with the disclosure requirements of the Securities Act
or (ii) the Company shall at any time fail to comply with the requirements of
Section 6.3, 6.4 or 6.6.

	Additional Shares.  In the event that (a)
within five Trading Days of any Closing Date, the Company gives notice to the
Investor of an impending "blackout period" during which the use of the
Registration Statement is not permitted due to the Company's non-disclosure of
material information, and  (b) the Bid Price on the Trading Day immediately
preceding such "blackout period" (the "Old Bid Price") is
greater than the Bid Price on the first Trading Day following such
"blackout period" (the "New Bid Price") the Company shall
issue to the Investor a number of additional shares (the "Blackout
Shares") equal to the difference between (y) the product of the number of
Registrable Securities held by the Investor during such "blackout
period" that are not otherwise freely tradable during such "blackout
period" and the Old Bid Price, divided by the New Bid Price and (z) the
number of Registrable Securities held by the Investor during such "blackout
period" that are not otherwise freely tradable during such "blackout
period".  If any such issuance would result in the issuance of a number of
shares which exceeds the number set forth in Section 2.1(b), then in lieu of
such issuance, the Company shall pay the Investor the closing bid price of the
Blackout Shares on the first Trading Day following the end of the blackout
period in cash within five Trading Days.

ARTICLE III

Representations and Warranties of Investor

The Investor represents and warrants to the Company
that:

	Intent.  The Investor is entering into this
Agreement for its own account and the Investor has no present arrangement
(whether or not legally binding) at any time to sell the Common Stock to or
through any person or entity; provided, however, that by making the
representations herein, the Investor does not agree to hold the Common Stock for
any minimum or other specific term and reserves the right to dispose of the
Common Stock at any time in accordance with federal and state securities laws
applicable to such disposition.

	Sophisticated Investor.  The Investor is a
sophisticated investor (as described in Rule 506(b)(2)(ii) of Regulation D) and
an accredited investor (as defined in Rule 501 of Regulation D), and Investor
has such experience in business and financial matters that it has the capacity
to protect its own interests in connection with this transaction and is capable
of evaluating the merits and risks of an investment in Common Stock.  The
Investor acknowledges that an investment in the Common Stock is speculative and
involves a high degree of risk. 

	Authority.  This Agreement has been duly
authorized and validly executed and delivered by the Investor and is a valid and
binding agreement of the Investor enforceable against it in accordance with its
terms, subject to applicable bankruptcy, insolvency, or similar laws relating
to, or affecting generally the enforcement of, creditors' rights and remedies or
by other equitable principles of general application. 

	Not an Affiliate.  Investor is not an officer,
director or "affiliate" (as that term is defined in Rule 405 of the
Securities Act) of the Company.

	Organization and Standing.  Investor is a
corporation duly organized, validly existing, and in good standing under the
laws of its jurisdiction of incorporation.

	Absence of Conflicts.  The execution and
delivery of this Agreement and any other document or instrument executed in
connection herewith, and the consummation of the transactions contemplated
thereby, and compliance with the requirements thereof, will not violate any law,
rule, regulation, order, writ, judgment, injunction, decree or award binding on
Investor, or, to the Investor's knowledge, (a) violate any provision of any
indenture, instrument or agreement to which Investor is a party or is subject,
or by which Investor or any of its assets is bound; (b) conflict with or
constitute a material default thereunder; (c) result in the creation or
imposition of any lien pursuant to the terms of any such indenture, instrument
or agreement, or constitute a breach of any fiduciary duty owed by Investor to
any third party; or (d) require the approval of any third-party (which has not
been obtained) pursuant to any material contract, agreement, instrument,
relationship or legal obligation to which Investor is subject or to which any of
its assets, operations or management may be subject.

	Disclosure; Access to Information.  Investor
has received and reviewed all documents, records, books and other publicly
available information pertaining to Investor's investment in the Company that
have been requested by Investor. The Company is subject to the periodic
reporting requirements of the Exchange Act, and Investor has reviewed copies of
any such reports that have been requested by it. 

	Manner of Sale.  At no time was Investor
presented with or solicited by or through any leaflet, public promotional
meeting, television advertisement or any other form of general solicitation or
advertising. 

	Financial Capacity.  Investor currently has
the financial capacity to meet its obligations to the Company hereunder, and the
Investor has no present knowledge of any circumstances which could cause it to
become unable to meet such obligations in the future.

	Underwriter Liability.  Investor understands that
it is the position of the SEC that the Investor is an underwriter within the
meaning of Section 2(11) of the Securities Act and that the Investor will be
identified as an underwriter of the Put Shares in the Registration
Statement.

ARTICLE IV

Representations and Warranties of the Company

The Company represents and warrants to the Investor that,
except as set forth on the Schedule of Exceptions attached hereto:

	Organization of the Company.  The Company is a
corporation duly incorporated and existing in good standing under the laws of
the State of Delaware and has all requisite corporate authority to own its
properties and to carry on its business as now being conducted.  The Company
does not have any subsidiaries and does not own more that fifty percent (50%) of
or control any other business entity, except as set forth in the SEC Documents.
The Company is duly qualified and is in good standing as a foreign corporation
to do business in every jurisdiction in which the nature of the business
conducted or property owned by it makes such qualification necessary, other than
those in which the failure so to qualify would not have a Material Adverse
Effect.

	Authority.  (i) The Company has the requisite
corporate power and corporate authority to enter into and perform its
obligations under this Agreement, the Registration Rights Agreement, the
Warrants and the Escrow Agreement and to issue the Put Shares, the Warrant and
the Warrant Shares, (ii) the execution, issuance and delivery of this Agreement,
the Registration Rights Agreement, the Warrants and the Escrow Agreement and the
consummation by it of the transactions contemplated hereby have been duly
authorized by all necessary corporate action and no further consent or
authorization of the Company or its Board of Directors or stockholders is
required (except as provided in Section 2.1(b)), and (iii) this Agreement, the
Registration Rights Agreement, the Warrants and the Escrow Agreement have been
duly executed and delivered by the Company and constitute valid and binding
obligations of the Company enforceable against the Company in accordance with
their terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, or similar laws relating to, or affecting generally the
enforcement of, creditors' rights and remedies or by other equitable principles
of general application.  The Company has duly and validly authorized and
reserved for issuance shares of Common Stock sufficient in number for the
issuance of the Put Shares at the Floor Price.  The Company understands and
acknowledges the potentially dilutive effect to the Common Stock of the issuance
of the Put Shares.

	Capitalization. The authorized capital stock
of the Company consists of 50,000,000 shares of Common Stock, $.01 par value per
share, and 987,930 shares of preferred stock, par value $.01 per share, 2,000 of
which have been designated as Series F Convertible Preferred Stock, 1,800 of
which have been designated as Series G Convertible Preferred Stock and 1,200
have been designated as Series H Convertible Preferred Stock.  As of August 18,
2000, 17,559,040 shares of Common Stock and 3,188 shares of preferred stock were
issued and outstanding.  Except as set forth in the Schedule of Exceptions or in
the SEC Documents, there are no outstanding Capital Shares Equivalents nor any
agreement or understandings pursuant to which any Capital Shares Equivalents may
become outstanding.  Except as set forth in the Schedule of Exceptions, the
Company is not a party to any agreement granting registration or anti-dilution
rights to any person with respect to any of its equity or debt securities.  All
of the outstanding shares of Common Stock of the Company have been duly and
validly authorized and issued and are fully paid and non-assessable. 

	Common Stock.  The Company has registered its
Common Stock pursuant to Section 12(b) or (g) of the Exchange Act and is in full
compliance with all reporting requirements of the Exchange Act.  As of the date
of this Agreement, the Common Stock is quoted on the Nasdaq SmallCap
Market.

	SEC Documents.  The Company has delivered or
made available to the Investor true and complete copies of the SEC Documents.
The Company has not provided to the Investor any information that, according to
applicable law, rule or regulation, should have been disclosed publicly prior to
the date hereof by the Company, but which has not been so disclosed. As of their
respective dates, the SEC Documents complied in all material respects with the
requirements of the Exchange Act, and rules and regulations of the SEC
promulgated thereunder and the SEC Documents did not contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading.  The financial
statements of the Company included in the SEC Documents complied in all material
respects with applicable accounting requirements and the published rules and
regulations of the SEC or other applicable rules and regulations with respect
thereto at the time of such inclusion. Such financial statements have been
prepared in accordance with generally accepted accounting principles applied on
a consistent basis during the periods involved (except (i) as may be otherwise
indicated in such financial statements or the notes thereto or (ii) in the case
of unaudited interim statements, to the extent they exclude footnotes or may be
condensed or summary statements) and fairly present in all material respects the
financial position of the Company as of the dates thereof and the results of
operations and cash flows for the periods then ended (subject, in the case of
unaudited interim statements, to normal year-end audit adjustments).  Neither
the Company nor any of its subsidiaries has any material indebtedness,
obligations or liabilities of any kind (whether accrued, absolute, contingent or
otherwise, and whether due or to become due) that would have been required to be
reflected in, reserved against or otherwise described in the financial
statements or in the notes thereto in accordance with GAAP, which was not fully
reflected in, reserved against or otherwise described in the financial
statements or the notes thereto included in the SEC Documents or was not
incurred in the ordinary course of business consistent with the Company's past
practices since the last date of such financial statements.

	Valid Issuances.  When issued and paid for in
accordance with a Put, the Put Shares will be registered for sale to the
Investor by the Company and by the Investor to the public, and will be duly and
validly issued, fully paid, and non-assessable. When issued and paid for upon
exercise of the Warrants, the Warrant Shares will be registered for sale to the
Investor by the Company and will be duly and validly issued, fully paid, and
non-assessable. Neither the sales of the Put Shares nor the Company's
performance of its obligations under this Agreement, the Registration Rights
Agreement, the Warrants or the Escrow Agreement will (i) result in the creation
or imposition by the Company of any liens, charges, claims or other encumbrances
upon the Put Shares or Warrant Shares or, except as contemplated herein, any of
the assets of the Company, or (ii) entitle the holders of Outstanding Capital
Shares to preemptive or other rights to subscribe to or acquire the Capital
Shares or other securities of the Company. The Put Shares, the Warrants and the
Warrant Shares shall not subject the Investor to personal liability to the
Company or its creditors by reason of the possession thereof.

	No Conflicts.  The execution, delivery and
performance of this Agreement by the Company and the consummation by the Company
of the transactions contemplated hereby, including without limitation the
issuance of the Put Shares, the Warrants or the Warrant Shares, do not and will
not (i) result in a violation of the Company's Restated Certificate of
Incorporation or By-Laws, each as amended as of the date of this Agreement, or
(ii) conflict with, or constitute a material default (or an event that with
notice or lapse of time or both would become a default) under, or give to others
any rights of termination, amendment, acceleration or cancellation of, any
material agreement, indenture or instrument, or any "lock-up" or
similar provision of any underwriting or similar agreement to which the Company
is a party, or (iii) result in a violation of any federal, state or local law,
rule, regulation, order, judgment or decree (including federal and state
securities laws and regulations) applicable to the Company or by which any
material property or asset of the Company is bound or affected, nor is the
Company otherwise in violation of, conflict with or default under any of the
foregoing (except in each case for such conflicts, defaults, terminations,
amendments, accelerations, cancellations and violations as would not have,
individually or in the aggregate, a Material Adverse Effect). The business of
the Company is not being conducted in violation of any law, ordinance or
regulation of any governmental entity, except for possible violations that
either singly or in the aggregate would not have a Material Adverse Effect. The
Company is not required under federal, state or local law, rule or regulation to
obtain any consent, authorization or order of, or make any filing or
registration with, any court or governmental agency in order for it to execute,
deliver or perform any of its obligations under this Agreement or issue and sell
the Put Shares, the Warrants or the Warrant Shares in accordance with the terms
hereof (other than any SEC, Nasdaq or state securities filings that may be
required to be made by the Company subsequent to Closing, any registration
statement that may be filed pursuant hereto, and any shareholder approval
required by the rules applicable to companies whose common stock trades on the
Nasdaq Stock Market); provided that, for purposes of the representation made in
this sentence, the Company is assuming and relying upon the accuracy of the
relevant representations and agreements of the Investor herein.

	No Material Adverse Change.  Since December
31, 1999, no Material Adverse Effect has occurred or exists with respect to the
Company, except as disclosed in the SEC Documents.  

	No Undisclosed Events or Circumstances.  Since
December 31, 1999, no event or circumstance has occurred or exists with respect
to the Company or its businesses, properties, prospects, operations or financial
condition, that, under applicable law, rule or regulation, requires public
disclosure or announcement prior to the date hereof by the Company but which has
not been so publicly announced or disclosed in the SEC Documents. 

	Litigation and Other Proceedings.  Except as
disclosed in the SEC Documents, there are no lawsuits or proceedings pending or,
to the knowledge of the Company, threatened, against the Company, nor has the
Company received any written or oral notice of any such action, suit, proceeding
or investigation, which could reasonably be expected to have a Material Adverse
Effect.  Except as set forth in the SEC Documents, no judgment, order, writ,
injunction or decree or award has been issued by or, to the knowledge of the
Company, requested of any court, arbitrator or governmental agency which could
result in a Material Adverse Effect.

	No Misleading or Untrue Communication.  The
Company and, to the knowledge of the Company, any person representing the
Company, or any other person selling or offering to sell the Put Shares or the
Warrants in connection with the transaction contemplated by this Agreement, have
not made, at any time, any oral communication in connection with the offer or
sale of the same which contained any untrue statement of a material fact or
omitted to state any material fact necessary in order to make the statements, in
the light of the circumstances under which they were made, not
misleading.

	Material Non-Public Information.  The Company has
not disclosed to the Investor any material non-public information that (i) if
disclosed, would reasonably be expected to have a material effect on the price
of the Common Stock or (ii) according to applicable law, rule or regulation,
should have been disclosed publicly by the Company prior to the date hereof but
which has not been so disclosed.

	Insurance.  The Company maintains property and
casualty, general liability, workers' compensation, environmental hazard,
personal injury and other similar types of insurance with financially sound and
reputable insurers that is adequate, consistent with industry standards and the
Company's historical claims experience.  The Company has not received notice
from, and has no knowledge of any threat by, any insurer (that has issued any
insurance policy to the Company) that such insurer intends to deny coverage
under or cancel, discontinue or not renew any insurance policy presently in
force.

	Tax Matters.

	The Company has filed all Tax Returns which it is
required to file under applicable laws, or has requested extensions for filing
such Tax Returns; all such Tax Returns are true and accurate and have been
prepared in compliance with all applicable laws; the Company has paid all Taxes
due and owing by it (whether or not such Taxes are required to be shown on a Tax
Return) and have withheld and paid over to the appropriate taxing authorities
all Taxes which it is required to withhold from amounts paid or owing to any
employee, stockholder, creditor or other third parties; and since December 31,
1999, the charges, accruals and reserves for Taxes with respect to the Company
(including any provisions for deferred income taxes) reflected on the books of
the Company are adequate to cover any Tax liabilities of the Company if its
current tax year were treated as ending on the date hereof.

	No claim has been made by a taxing authority in a
jurisdiction where the Company does not file tax returns that such corporation
is or may be subject to taxation by that jurisdiction.  There are no foreign,
federal, state or local tax audits or administrative or judicial proceedings
pending or being conducted with respect to the Company; no information related
to Tax matters has been requested by any foreign, federal, state or local taxing
authority; and, except as disclosed above, no written notice indicating an
intent to open an audit or other review has been received by the Company from
any foreign, federal, state or local taxing authority.  There are no material
unresolved questions or claims concerning the Company's Tax liability.  The
Company (A) has not executed or entered into a closing agreement pursuant to
7121 of the Internal Revenue Code or any predecessor provision thereof or any
similar provision of state, local or foreign law; or (B) has not agreed to or is
required to make any adjustments pursuant to   481 (a) of the Internal Revenue
Code or any similar provision of state, local or foreign law by reason of a
change in accounting method initiated by the Company or any of its subsidiaries
or has any knowledge that the IRS has proposed any such adjustment or change in
accounting method, or has any application pending with any taxing authority
requesting permission for any changes in accounting methods that relate to the
business or operations of the Company.  The Company has not been a United States
real property holding corporation within the  meaning of  897(c)(2) of the
Internal Revenue Code during the applicable period specified in
 897(c)(1)(A)(ii) of the Internal Revenue Code.

	The Company has not made an election under   341(f) of
the Internal Revenue Code.  The Company is not liable for the Taxes of another
person that is not a subsidiary of the Company under (A) Treas. Reg.   1.1502-6
(or comparable provisions of state, local or foreign law), (B) as a transferee
or successor, (C) by contract or indemnity or (D) otherwise.  The Company is not
a party to any tax sharing agreement.  The Company has not made any payments, is
obligated to make payments or is a party to an agreement that could obligate it
to make any payments that would not be deductible under   280G of the Internal
Revenue Code.

	For purposes of this Section 4.14:

"IRS" means the United States Internal Revenue
Service.

"Tax" or "Taxes" means federal, state,
county, local, foreign, or other income, gross receipts, ad valorem, franchise,
profits, sales or use, transfer, registration, excise, utility, environmental,
communications, real or personal property, capital stock, license, payroll, wage
or other withholding, employment, social security, severance, stamp, occupation,
alternative or add-on minimum, estimated and other taxes of any kind whatsoever
(including, without limitation, deficiencies, penalties, additions to tax, and
interest attributable thereto) whether disputed or not.

"Tax Return" means any return, information report
or filing with respect to Taxes, including any schedules attached thereto and
including any amendment thereof.

	Property.  Neither the Company nor any of its
subsidiaries owns any real property except as set forth in the SEC Documents.
Each of the Company and its subsidiaries has good and marketable title to all
personal property owned by it, free and clear of all liens, encumbrances and
defects except such as do not materially affect the value of such property and
do not materially interfere with the use made and proposed to be made of such
property by the Company; and to the Company's knowledge any real property and
buildings held under lease by the Company as tenant are held by it under valid,
subsisting and enforceable leases with such exceptions as are not material and
do not interfere with the use made and intended to be made of such property and
buildings by the Company.

	Licensing and Permits.  The Company holds all
necessary licenses and permits for the conduct of its business. All of such
licenses and permits are in good standing and the Company is not in material
default of any of the conditions thereof.

	Intellectual Property.  Each of the Company and
its subsidiaries owns or possesses adequate and enforceable rights to use all
patents, patent applications, trademarks, trademark applications, trade names,
service marks, copyrights, copyright applications, licenses, know-how (including
trade secrets and other unpatented and/or unpatentable proprietary or
confidential information, systems or procedures) and other similar rights and
proprietary knowledge (collectively, "Intangibles") necessary for the
conduct of its business as now being conducted.  To the Company's knowledge,
except as disclosed in the SEC Documents neither the Company nor any of its
subsidiaries is infringing upon or in conflict with any right of any other
person with respect to any Intangibles.  Except as disclosed in the SEC
Documents, no claims have been asserted by any person to the ownership or use of
any Intangibles and the Company has no knowledge of any basis for such
claim.

	Internal Controls and Procedures.  The Company
maintains books and records and internal accounting controls which provide
reasonable assurance that (i) all transactions to which the Company is a party
or by which its properties are bound are executed with management's
authorization; (ii) the recorded accounting of the Company's assets is compared
with existing assets at regular intervals; (iii) access to the Company's assets
is permitted only in accordance with management's authorization; and (iv) all
transactions to which the Company is a party or by which its properties are
bound are recorded as necessary to permit preparation of the financial
statements of the Company in accordance with U.S. generally accepted accounting
principles.

	Payments and Contributions.  Neither the Company
nor any of its directors, officers or, to its knowledge, other employees has (i)
used any Company funds for any unlawful contribution, endorsement, gift,
entertainment or other unlawful expense relating to political activity; (ii)
made any direct or indirect unlawful payment of Company funds to any foreign or
domestic government official or employee; (iii) violated or is in violation of
any provision of the Foreign Corrupt Practices Act of 1977, as amended; or (iv)
made any bribe, rebate, payoff, influence payment, kickback or other similar
payment to any person with respect to Company matters.

	No Misrepresentation.  Except as set forth in the
Disclosure Schedule, the representations and warranties of the Company contained
in this Agreement, any schedule, annex or exhibit hereto and any agreement,
instrument or certificate furnished by the Company to the Investor pursuant to
this Agreement, do not contain any untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading.

ARTICLE V

Covenants of the Investor

Investor covenants with the Company that:

	Compliance with Law.  The Investor's trading
activities with respect to shares of the Company's Common Stock will be in
compliance with all applicable state and federal securities laws, rules and
regulations and rules and regulations of the Principal Market on which the
Company's Common Stock is listed.  Without limiting the generality of the
foregoing, the Investor agrees that it will, whenever required by federal
securities laws, deliver the prospectus included in the Registration Statement
to any purchaser of Put Shares from the Investor.

	Short Sales.  The Investor and its affiliates
shall not engage in short sales of the Company's Common Stock; provided,
however, that the Investor may enter into any short sale or other hedging or
similar arrangement it deems appropriate (collectively, a "short
sale") with respect to the Put Shares, so long as such Shares or
arrangements do not involve more than the number of such Put Shares (determined
as of the date of such Put Notice) and are otherwise in compliance with
Regulation M under the Securities Act.  

ARTICLE VI

Covenants of the Company

	Registration Rights.  The Company shall
cause the Registration Statement  to become and then remain effective throughout
the term of this Agreement, or until all shares of Common Stock registered
thereunder have been sold, in which event the Company shall file a further
Registration Statement permitting the sale of additional Put Shares and the
Warrant Shares, which such additional Registration Statement shall be effective
within one hundred twenty (120) days of the termination or withdrawal of the
present Registration Statement, or the Investor's obligations under this
Agreement shall terminate.

	Reservation of Common Stock.  As of the date
hereof, the Company has reserved and the Company shall continue to reserve and
keep available at all times, free of preemptive rights, shares of Common Stock
for the purpose of enabling the Company issue the Put Shares.  The number of
shares so reserved from time to time, as theretofore increased or reduced as
hereinafter provided, may be reduced by the number of shares actually delivered
hereunder. 

	Listing of Common Stock.  The Company hereby
agrees to maintain the listing of the Common Stock on a Principal Market, and as
soon as practicable (but in any event prior to the commencement of the
Commitment Period) to list the Put Shares and the Warrant Shares. The Company
further agrees, if the Company applies to have the Common Stock traded on any
other Principal Market, it will include in such application the Put Shares and
the Warrant Shares and will take such other action as is necessary or desirable
in the opinion of the Investor to cause the Common Stock to be listed on such
other Principal Market as promptly as possible. The Company will take all action
to continue the listing and trading of its Common Stock on the Principal Market
(including, without limitation, maintaining sufficient net tangible assets) and
will comply in all respects with the Company's reporting, filing and other
obligations under the bylaws or rules of the Principal Market and shall provide
the Investor with copies of any correspondence to or from such Principal Market
which questions or threatens delisting of the Common Stock, within one Trading
Day of the Company's receipt thereof.

	Exchange Act Registration.  The Company will
cause its Common Stock to continue to be registered under Section 12(g) or 12(b)
of the Exchange Act, will use its best efforts to comply in all respects with
its reporting and filing obligations under the Exchange Act, and will not take
any action or file any document (whether or not permitted by Exchange Act or the
rules thereunder) to terminate or suspend such registration or to terminate or
suspend its reporting and filing obligations under said Act.

	Legends.  The certificates evidencing the
Common Stock to be sold to the Investor shall be free of restrictive
legends.

	Corporate Existence.  The Company will take
all steps necessary to preserve and continue the corporate existence of the
Company.

	.Notice of Certain Events Affecting Registration;
Suspension of Right to Make a Put.  The Company will immediately notify the
Investor upon the occurrence of any of the following events in respect of a
registration statement or related prospectus in respect of an offering of
Registrable Securities: (i) receipt of any request for additional information
from the SEC or any other federal or state governmental authority during the
period of effectiveness of the Registration Statement the response to which
would require any amendments or supplements to the registration statement or
related prospectus; (ii) the issuance by the SEC or any other federal or state
governmental authority of any stop order suspending the effectiveness of the
Registration Statement or the initiation of any proceedings for that purpose;
(iii) receipt of any notification with respect to the suspension of the
qualification or exemption from qualification of any of the Registrable
Securities for sale in any jurisdiction or the initiation or threatening of any
proceeding for such purpose; (iv) the happening of any event that makes any
statement made in the Registration Statement or related prospectus or any
document incorporated or deemed to be incorporated therein by reference untrue
in any material respect or that requires the making of any changes in the
Registration Statement, related prospectus or documents so that, in the case of
the Registration Statement, it will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading, and that in the case
of the related prospectus, it will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading; and (v) the Company's reasonable
determination that a post-effective amendment to the Registration Statement
would be appropriate; and the Company will promptly make available to the
Investor any such supplement or amendment to the related prospectus. The Company
shall not deliver to the Investor any Put Notice during the continuation of any
of the foregoing events.

	Expectations Regarding Put Notices.  Within
ten (10) days after the commencement of each calendar quarter occurring
subsequent to the commencement of the Commitment Period, the Company must notify
the Investor, in writing, as to its reasonable expectations as to the dollar
amount it intends to raise during such calendar quarter, if any, through the
issuance of Put Notices. Such notification shall constitute only the Company's
good faith estimate and shall in no way obligate the Company to raise such
amount, or any amount, or otherwise limit its ability to deliver Put Notices.
The failure by the Company to comply with this provision can be cured by the
Company's notifying the Investor, in writing, at any time as to its reasonable
expectations with respect to the current calendar quarter.

	Consolidation; Merger.  The Company shall not,
at any time after the date hereof, effect any merger or consolidation of the
Company with or into, or a transfer of all or substantially all of the assets of
the Company to, another entity (a "Consolidation Event") unless the
resulting successor or acquiring entity (if not the Company) assumes by written
instrument or by operation of law the obligation to deliver to the Investor such
shares of stock and/or securities as the Investor is entitled to receive
pursuant to this Agreement.

	Minimum Issuance of Put Shares.  The Company shall
issue Put Notices in the minimum amount of $100,000 during the Commitment
Period.  

	Limitation on Similar Financing.  The Company
agrees that it will not enter into any other equity line of credit type of
agreement or other private financing at a price below the then-current bid price
of the Common Stock during the Commitment Period without the prior written
consent of the Investor. 

ARTICLE VII

Conditions to Delivery of Puts

and Conditions to Closing

	Conditions Precedent to the Obligation of the
Company to Issue and Sell Common Stock.  The obligation hereunder of the
Company to issue and sell the Put Shares to the Investor incident to each
Closing is subject to the satisfaction, at or before each such Closing, of each
of the conditions set forth below.

	Accuracy of the Investor; Representation and
Warranties. The representations and warranties of the Investor shall be true
and correct in all material respects as of the date of this Agreement and as of
the date of each such Closing as though made at each such time.

	Performance by the Investor. The Investor shall
have performed, satisfied and complied in all material respects with all
covenants, agreements and conditions required by this Agreement to be performed,
satisfied or complied with by the Investor at or prior to such
Closing.

	Conditions Precedent to the Right of the Company
to Deliver a Put Notice and the Obligation of the Investor to Purchase Put
Shares.  The right of the Company to deliver a Put Notice and the obligation
of the Investor to acquire and pay for the Put Shares incident to a Closing is
subject to the satisfaction, on both (i) the date of delivery of such Put Notice
and (ii) the applicable Closing Date (each a "Condition Satisfaction
Date"), of each of the following conditions:

	Closing Certificate.  All representations and
warranties of the Company contained herein shall remain true and correct as of
the Closing Date as though made as of such date (other than warranties which
speak as of a specific date) and the Company shall have delivered into escrow an
Officer's Certificate signed by its Chief Executive Officer certifying that all
of the Company's representations and warranties herein remain true and correct
as of the Closing Date and that the Company has performed all covenants and
satisfied all conditions to be performed or satisfied by the Company prior to
such Closing; 

	Blue Sky.  The Company shall have obtained all
permits and qualifications required by any state for the offer and sale of the
Common Stock to the Investor and by the Investor as set forth in the
Registration Rights Agreement or shall have the availability of exemptions
therefrom; 

	Delivery of Put Shares and Warrants.  Delivery to
the Depository Trust Company DWAC account specified by the Investor of the Put
Shares;

	Opinion of Counsel.  Receipt by the Investor of an
opinion of counsel to the Company, in the form of Exhibit E attached hereto;
and

	Registration of the Common Stock with the SEC. The
Registration Statement shall remain effective (or, if a further Registration
Statement shall be necessary, shall have previously become effective) and shall
be available for making resales of the Put Shares by the Investor on each
Condition Satisfaction Date and (i) neither the Company nor the Investor shall
have received notice that the SEC has issued or intends to issue a stop order
with respect to the Registration Statement or that the SEC otherwise has
suspended or withdrawn the effectiveness of the Registration Statement, either
temporarily or permanently, or intends or has threatened to do so (unless the
SEC's concerns have been addressed and the Investor is reasonably satisfied that
the SEC no longer is considering or intends to take such action), and (ii) no
other suspension of the use or withdrawal of the effectiveness of the
Registration Statement or related prospectus shall exist.  

	Authority. The Company will satisfy all laws and
regulations pertaining to the sale and issuance of the Put Shares.

	Performance by the Company. The Company shall have
performed, satisfied and complied in all material respects with all covenants,
agreements and conditions required by this Agreement, the Registration Rights
Agreement and the Escrow Agreement to be performed, satisfied or complied with
by the Company at or prior to each Condition Satisfaction Date. 

	No Injunction. No statute, rule, regulation,
executive order, decree, ruling or injunction shall have been enacted, entered,
promulgated or endorsed by any court or governmental authority of competent
jurisdiction that prohibits or directly and adversely affects any of the
transactions contemplated by this Agreement, and no proceeding shall have been
commenced that may have the effect of prohibiting or adversely affecting any of
the transactions contemplated by this Agreement.

	Adverse Changes. Since the date of filing of the
Company's most recent SEC Document, no event that had or is reasonably likely to
have a Material Adverse Effect has occurred.

	No Suspension of Trading In and Continued Listing or
Quotation of Common Stock. The trading of the Common Stock (including,
without limitation, the Put Shares) is not suspended by the SEC or the Principal
Market, and the Common Stock (including, without limitation, the Put Shares)
shall have been approved for listing or quotation on and shall continue to be
listed on a Principal Market. The issuance of shares of Common Stock with
respect to the applicable Closing, if any, shall not violate the shareholder
approval requirements of the Principal Market.

	No Knowledge. The Company has no knowledge of any
event more likely than not to have the effect of causing such Registration
Statement to be suspended or otherwise ineffective (which event is reasonably
likely to occur within the thirty (30) Trading Days following the Trading Day on
which such Notice is deemed delivered).

	Trading Cushion. The Trading Cushion shall have
elapsed since the next preceding Put Date.  

	Other. On each Condition Satisfaction Date, the
Investor shall have received and been reasonably satisfied with such other
certificates and documents as shall have been reasonably requested by the
Investor in order for the Investor to confirm the Company's satisfaction of the
conditions set forth in this Section 7.2.

ARTICLE VIII

Due Diligence Review; Non-Disclosure of Non-Public Information.

	Due Diligence Review.  The Company shall
make available for inspection and review by the Investor, advisors to and
representatives of the Investor (who may or may not be affiliated with the
Investor and who are reasonably acceptable to the Company), any underwriter
participating in any disposition of the Registrable Securities on behalf of the
Investor pursuant to the Registration Statement, any such registration statement
or amendment or supplement thereto or any blue sky, NASD or other filing, all
SEC Documents and other filings with the SEC, and all other publicly available
corporate documents and properties of the Company as may be reasonably necessary
for the purpose of such review, and cause the Company's officers, directors and
employees to supply all such publicly available information reasonably requested
by the Investor or any such representative, advisor or underwriter in connection
with such Registration Statement (including, without limitation, in response to
all questions and other inquiries reasonably made or submitted by any of them),
prior to and from time to time after the filing and effectiveness of the
Registration Statement for the sole purpose of enabling the Investor and such
representatives, advisors and underwriters and their respective accountants and
attorneys to conduct initial and ongoing due diligence with respect to the
Company and the accuracy of the Registration Statement. 

	Non-Disclosure of Non-Public
Information.

	The Company shall not disclose non-public information to
the Investor, advisors to or representatives of the Investor unless prior to
disclosure of such information the Company identifies such information as being
non-public information and provides the Investor, such advisors and
representatives with the opportunity to accept or refuse to accept such non-
public information for review. The Company may, as a condition to disclosing any
non-public information hereunder, require the Investor's advisors and
representatives to enter into a confidentiality agreement in form reasonably
satisfactory to the Company and the Investor.

	The Company represents that it does not disseminate non-
public information to any investors who purchase stock in the Company in a
public offering, to money managers or to securities analysts, provided, however,
that notwithstanding anything herein to the contrary, the Company will, as
hereinabove provided, immediately notify the advisors and representatives of the
Investors and, if any, underwriters, of any event or the existence of any
circumstance (without any obligation to disclose the specific event or
circumstance) of which it becomes aware, constituting non-public information
(whether or not requested of the Company specifically or generally during the
course of due diligence by such persons or entities), which, if not disclosed in
the prospectus included in the Registration Statement would cause such
prospectus to include a material misstatement or to omit a material fact
required to be stated therein in order to make the statements, therein in light
of the circumstances in which they were made, not misleading. Nothing contained
in this Section 8.2 shall be construed to mean that such persons or entities
other than the Investor (without the written consent of the Investor prior to
disclosure of such information) may not obtain non-public information in the
course of conducting due diligence in accordance with the terms of this
Agreement and nothing herein shall prevent any such persons or entities from
notifying the Company of their opinion that based on such due diligence by such
persons or entities, that the Registration Statement contains an untrue
statement of a material fact or omits a material fact required to be stated in
the Registration Statement or necessary to make the  statements contained
therein, in light of the circumstances in which they were made, not
misleading.

ARTICLE IX

Transfer Agent Instructions 

	Transfer Agent Instructions. Upon each
Closing, the Company will issue to the transfer agent for its Common Stock (and
to any substitute or replacement transfer agent for its Common Stock upon the
Company's appointment of any such substitute or replacement transfer agent)
instructions to deliver the Put Shares without restrictive legends to the DTC
DWAC account specified by the Investor. 

	No Legend or Stock Transfer Restrictions. No
legend shall be placed on the share certificates representing the Put Shares and
no instructions or "stop transfer orders," so called, "stock
transfer restrictions," or other restrictions have been or shall be given
to the Company's transfer agent with respect thereto.

	Investor's Compliance. Nothing in this Article
shall affect in any way the Investor's obligations under any agreement to comply
with all applicable securities laws upon resale of the Put Shares.

ARTICLE X

Indemnification

	 Survival.  The
representations, warranties and covenants made by each of the Company and the
Investor in this Agreement, the schedules and exhibits hereto and in each
instrument, agreement and certificate entered into and delivered by them
pursuant to this Agreement, shall survive each Closing and the consummation of
the transactions contemplated hereby until the expiration of one year from the
date of the Put to which such claim applies.  In the event of a breach or
violation of any of such representations, warranties or covenants, the party to
whom such representations, warranties or covenants have been made shall have all
rights and remedies for such breach or violation available to it under the
provisions of this Agreement, irrespective of any investigation made by or on
behalf of such party on or prior to the Closing Date.

	 General Indemnity.
The Company agrees to indemnify and hold harmless the Investor (and its
directors, officers, affiliates, agents, successors and assigns) from and
against any and all losses, liabilities, deficiencies, costs, damages and
expenses (including, without limitation, reasonable attorney's fees, charges and
disbursements) incurred by the Investor to any third party as a result of any
inaccuracy in or breach of the representations, warranties or covenants made by
the Company herein.  The Investor agrees to indemnify and hold harmless the
Company and its directors, officers, affiliates, agents, successors and assigns
from and against any and all losses, liabilities, deficiencies, costs, damages
and expenses (including, without limitation, reasonable attorneys fees, charges
and disbursements) incurred by the Company to any third party as result of any
inaccuracy in or breach of the representations, warranties or covenants made by
the Investor herein.  The indemnification against such third-party claims shall
survive any expiration of this Agreement.

	 Securities Law Indemnity. 

	The Company agrees to indemnify and hold harmless the
Investor and each person, if any, who controls the Investor within the meaning
of the Securities Act ("Distributing Investor") against any losses,
claims, damages or liabilities, joint or several (which shall, for all purposes
of this Agreement, include, but not be limited to, all reasonable costs of
defense and investigation and all reasonable attorneys' fees), to which the
Distributing Investor may become subject, under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the Registration Statement, or any
related preliminary prospectus, final prospectus or amendment or supplement
thereto, or arise out of or are based upon 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; provided, however, that the Company will
not be liable in any such case to the extent that any such loss, claim, damage
or liability arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in the Registration
Statement, preliminary prospectus, final prospectus or amendment  or supplement
thereto in reliance upon, and in conformity with, written information furnished
to the Company by the Distributing Investor, specifically for use in the
preparation thereof. This Section 10.3(a) shall not inure to the benefit of any
Distributing Investor with respect to any person asserting such loss, claim,
damage or liability who purchased the Registrable Securities which are the
subject thereof if the Distributing Investor failed to send or give (in
violation of the Securities Act or the rules and regulations promulgated
thereunder) a copy of the prospectus contained in such Registration Statement to
such person at or prior to the written confirmation to such person of the sale
of such Registrable Securities, where the Distributing Investor were obligated
to do so under the Securities Act or the rules and regulations promulgated
thereunder.  This indemnity agreement will be in addition to any liability which
the Company may otherwise have. 

	Each Distributing Investor agrees that it will indemnify
and hold harmless the Company, and each officer, director of the Company or
person, if any, who controls the Company within the meaning of the Securities
Act, against any losses, claims, damages or liabilities (which shall, for all
purposes of this Agreement, include, but not be limited to, all reasonable costs
of defense and investigation and all reasonable attorneys' fees) to which the
Company or any such officer, director or controlling person may become subject
under the Securities Act or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of any material fact contained
in the Registration Statement, or any related preliminary prospectus, final
prospectus or amendment or supplement thereto, or arise out of or are based upon
the omission or the alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
but in each case only to the extent that such untrue statement or alleged untrue
statement or omission or alleged omission was made in the Registration
Statement, preliminary prospectus, final prospectus or amendment or supplement
thereto in reliance upon, and in conformity with, written information furnished
to the Company by such Distributing Investor, specifically for use in the
preparation thereof. This indemnity agreement will be in addition to any
liability which the Distributing Investor may otherwise have.

	 Indemnification
Procedure.  Any party entitled to indemnification under this Article X
(an "indemnified party") will give written notice to the indemnifying party of
any matters giving rise to a claim for indemnification; provided, that the
failure of any party entitled to indemnification hereunder to give notice as
provided herein shall not relieve the indemnifying party of its obligations
under this Article X except to the extent that the indemnifying party is
actually prejudiced by such failure to give notice.  In case any action,
proceeding or claim is brought against an indemnified party in respect of which
indemnification is sought hereunder, the indemnifying party shall be entitled to
participate in and, unless in the reasonable judgment of counsel to the
indemnified party a conflict of interest between it and the indemnifying party
may exist with respect of such action, proceeding or claim, to assume the
defense thereof with counsel reasonably satisfactory to the indemnified party.
In the event that the indemnifying party advises an indemnified party that it
will contest such a claim for indemnification hereunder, or fails, within thirty
(30) days of receipt of any indemnification notice to notify, in writing, such
person of its election to defend, settle or compromise, at its sole cost and
expense, any action, proceeding or claim (or discontinues its defense at any
time after it commences such defense), then the indemnified party may, at its
option, defend, settle or otherwise compromise or pay such action or claim.  In
any event, unless and until the indemnifying party elects in writing to assume
and does so assume the defense of any such claim, proceeding or action, the
indemnified party's costs and expenses arising out of the defense, settlement or
compromise of any such action, claim or proceeding shall be losses subject to
indemnification hereunder.  The indemnified party shall cooperate fully with the
indemnifying party in connection with any settlement negotiations or defense of
any such action or claim by the indemnifying party and shall furnish to the
indemnifying party all information reasonably available to the indemnified party
which relates to such action or claim.  The indemnifying party shall keep the
indemnified party fully apprised at all times as to the status of the defense or
any settlement negotiations with respect thereto.  If the indemnifying party
elects to defend any such action or claim, then the indemnified party shall be
entitled to participate in such defense with counsel of its choice at its sole
cost and expense.  The indemnifying party shall not be liable for any settlement
of any action, claim or proceeding effected without its prior written consent.
Notwithstanding anything in this Article X to the contrary, the indemnifying
party shall not, without the indemnified party's prior written consent, settle
or compromise any claim or consent to entry of any judgment in respect thereof
which imposes any future obligation on the indemnified party or which does not
include, as an unconditional term thereof, the giving by the claimant or the
plaintiff to the indemnified party of a release from all liability in respect of
such claim.  The indemnification required by this Article X shall be made by
periodic payments of the amount thereof during the course of investigation or
defense, as and when bills are received or expense, loss, damage or liability is
incurred, so long as the indemnified party irrevocably agrees to refund such
moneys if it is ultimately determined by a court of competent jurisdiction that
such party was not entitled to indemnification.  The indemnity agreements
contained herein shall be in addition to (a) any cause of action or similar
rights of the indemnified party against the indemnifying party or others, and
(b) any liabilities the indemnifying party may be subject to.

	Contribution.  In order to provide for just and
equitable contribution under the Securities Act in any case in which (i) the
indemnified party makes a claim for indemnification pursuant to Section 10.4
hereof but is judicially determined (by the entry of a final judgment or decree
by a court of competent jurisdiction and the expiration of time to appeal or the
denial of the last right of appeal) that such indemnification may not be
enforced in such case notwithstanding the fact that the express provisions of
Section 10.4 hereof provide for indemnification in such case, or (ii)
contribution under the Securities Act may be required on the part of any
indemnified party, then the Company and the applicable Distributing Investor
shall contribute to the aggregate losses, claims, damages or liabilities to
which they may be subject (which shall, for all purposes of this Agreement,
include, but not be limited to, all reasonable costs of defense and
investigation and all reasonable attorneys' fees), in either such case (after
contribution from others) on the basis of relative fault as well as any other
relevant equitable considerations.  The relative fault shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company on the one hand or the applicable
Distributing Investor on the other hand, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.   The Company and the Investor agree that it would not be
just and equitable if contribution pursuant to this Section 10.5 were determined
by pro rata allocation or by any other method of allocation which does not take
account of the equitable considerations referred to in this Section 10.5.  The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to above
in this Section 10.5 shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.

Notwithstanding any other provision of this Section 10.5,
in no event shall any (i) Investor be required to undertake liability to any
person under this Section 10.5 for any amounts in excess of the dollar amount of
the net proceeds to be received by such Investor from the sale of such
Investor's Registrable Securities (after deducting any fees, discounts and
commissions applicable thereto) pursuant to any Registration Statement under
which such Registrable Securities are to be registered under the Securities Act
and (ii) underwriter be required to undertake liability to any person hereunder
for any amounts in excess of the aggregate discount, commission or other
compensation payable to such underwriter with respect to the Registrable
Securities underwritten by it and distributed pursuant to the Registration
Statement.

ARTICLE XI

Choice of Law

	Governing Law/Arbitration. This Agreement
shall be governed by and construed in accordance with the laws of the State of
New York applicable to contracts made in New York by persons domiciled in New
York City and without regard to its principles of conflicts of laws.   Any
dispute under this Agreement or any Exhibit attached hereto shall be submitted
to arbitration under the American Arbitration Association (the "AAA")
in New York City, New York, and shall be finally and conclusively determined by
the decision of a board of arbitration consisting of three (3) members
(hereinafter referred to as the "Board of Arbitration") selected as
according to the rules governing the AAA.  The Board of Arbitration shall meet
on consecutive business days in New York City, New York, and shall reach and
render a decision in writing (concurred in by a majority of the members of the
Board of Arbitration) with respect to the amount, if any, which the losing party
is required to pay to the other party in respect of a claim filed.  In
connection with rendering its decisions, the Board of Arbitration shall adopt
and follow the laws of the State of New York.  To the extent practical,
decisions of the Board of Arbitration shall be rendered no more than thirty (30)
calendar days following commencement of proceedings with respect thereto.  The
Board of Arbitration shall cause its written decision to be delivered to all
parties involved in the dispute. The Board of Arbitration shall be authorized
and is directed to enter  a default judgment against any party refusing to
participate in the arbitration proceeding within thirty days of any deadline for
such participation. Any decision made by the Board of Arbitration (either prior
to or after the expiration of such thirty (30) calendar day period) shall be
final, binding and conclusive on the parties to the dispute, and entitled to be
enforced to the fullest extent permitted by law and entered in any court of
competent jurisdiction.  The prevailing party shall be awarded its attorney's
fees from the non-prevailing party as part of the arbitration award.  Any party
shall have the right to seek injunctive relief from any court of competent
jurisdiction in any case where such relief is available, and the prevailing
party shall be entitled to reasonable attorneys' fees incurred in connection
with any such injunctive proceeding.

ARTICLE XII

Assignment

	Assignment.  Neither this Agreement nor any
rights of the Investor or the Company hereunder may be assigned by either party
to any other person. Notwithstanding the foregoing, (a) the provisions of this
Agreement shall inure to the benefit of, and be enforceable by, any transferee
of any of the Common Stock purchased or acquired by the Investor hereunder with
respect to the Common Stock held by such person, and (b) upon the prior written
consent of the Company, which consent shall not unreasonably be withheld or
delayed in the case of an assignment to an affiliate of the Investor, an
Investor's interest in this Agreement may be assigned at any time, in whole or
in part, to any other person or entity (including any affiliate of the Investor)
who agrees to make the representations and warranties contained in Article III
and who agrees to be bound hereby; provided, that the Investor shall not assign
its rights to any person known to the Investor to be in a business competitive
with that of the Company.

ARTICLE XIII

Notices

	Notices.  All notices, demands, requests,
consents, approvals, and other communications required or permitted hereunder
shall be in writing and, unless otherwise specified herein, shall be (i)
personally served, (ii) deposited in the mail, registered or certified, return
receipt requested, postage prepaid, (iii) delivered by reputable air courier
service with charges prepaid, or (iv) transmitted by hand delivery, telegram, or
facsimile, addressed as set forth below or to such other address as such party
shall have specified most recently by written notice.  Any notice or other
communication required or permitted to be given hereunder shall be deemed
effective (a) upon hand delivery or delivery by facsimile, with accurate
confirmation generated by the transmitting facsimile machine, at the address or
number designated below (if delivered on a business day during normal business
hours where such notice is to be received), or the first business day following
such delivery (if delivered other than on a business day during normal business
hours where such notice is to be received) or (b) on the second business
day following the date of mailing by reputable courier service, fully prepaid,
addressed to such address, or upon actual receipt of such mailing, whichever
shall first occur.  The addresses for such communications shall
be:

If to the Company:

Dr. Ramesh C. Trivedi, Chief Executive Officer

Integrated Surgical Systems, Inc.

1850 Research Park Drive

Davis, CA  95616-4884

Telephone: (530) 792-2600

Facsimile:  (530) 792-2690

with a copy to:Jack Becker, Esq.

(which shall notSnow Becker Krauss P.C.

constitute notice)605 Third Avenue

New York, NY  10158-0125

Telephone: (212) 687-3860

Facsimile:  (212) 949-7052 

if to the Investor:Triton West Group, Inc.

c/o CFS Ltd.

Harbor Centre, 4th floor

PO Box 613 GT

Georgetown, Grand Cayman

Attention: Ian Goodall 

Telephone: (345) 949-4244

Facsimile: (345) 949-8635

with a copy to:Robert Charron, Esq.

(which shall notEpstein Becker & Green, P.C.

constitute notice)250 Park Avenue

New York, New York

Telephone: (212) 351-4500

Facsimile: (212) 661-0989

Either party hereto may from time to time change its address
or facsimile number for notices under this Section 13.1 by giving at least ten
(10) days' prior written notice of such changed address or facsimile number
to the other party hereto.

ARTICLE XIV

Miscellaneous

	Counterparts/ Facsimile/Amendments. This
Agreement may be executed in multiple counterparts, each of which may be
executed by less than all of the parties and shall be deemed to be an original
instrument which shall be enforceable against the parties actually executing
such counterparts and all of which together shall constitute one and the same
instrument.  Except as otherwise stated herein, in lieu of the original
documents, a facsimile transmission or copy of the original documents shall be
as effective and enforceable as the original.  This Agreement may be amended
only by a writing executed by all parties.

	Entire Agreement. This Agreement, the Exhibits
hereto, which include, but are not limited to the Escrow Agreement, the Warrants
and the Registration Rights Agreement, set forth the entire agreement and
understanding of the parties relating to the subject matter hereof and
supersedes all prior and contemporaneous agreements (including, without
limitation, the Private Equity Line of Credit Agreement dated as of April 17,
2000, which shall terminate upon execution of this Agreement), negotiations and
understandings between the parties, both oral and written relating to the
subject matter hereof. The terms and conditions of all Exhibits to this
Agreement are incorporated herein by this reference and shall constitute part of
this Agreement as is fully set forth herein.

	Survival; Severability. The representations,
warranties, covenants and agreements of the parties hereto shall survive each
Closing hereunder for a period of three years. In the event that any provision
of this Agreement becomes or is declared by a court of competent jurisdiction to
be illegal, unenforceable or void, this Agreement shall continue in full force
and effect without said provision; provided that such severability shall be
ineffective if it materially changes the economic benefit of this Agreement to
any party.

	Title and Subtitles. The titles and subtitles used
in this Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement. 

	Reporting Entity for the Common Stock. The
reporting entity relied upon for the determination of the trading price or
trading volume of the Common Stock on any given Trading Day for the purposes of
this Agreement shall be Bloomberg, L.P. or any successor thereto. The written
mutual consent of the Investor and the Company shall be required to employ any
other reporting entity.

	Replacement of Certificates. Upon (i) receipt of
evidence reasonably satisfactory to the Company of the loss, theft, destruction
or mutilation of a certificate representing the Put Shares and (ii) in the case
of any such loss, theft or destruction of such certificate, upon delivery of an
indemnity agreement or security reasonably satisfactory in form and amount to
the Company (which shall not exceed that required by the Company's transfer
agent in the ordinary course) or (iii) in the case of any such mutilation, on
surrender and cancellation of such certificate, the Company at its expense will
execute and deliver, in lieu thereof, a new certificate of like tenor.

	Fees and Expenses. Each of the Company and the
Investor agrees to pay its own expenses incident to the performance of its
obligations hereunder, except that the Company shall pay the fees, expenses and
disbursements of Investor's counsel in the amount of $16,000, plus $1,000 per
Closing of a Put.

	Brokerage. Each of the parties hereto represents
that it has had no dealings in connection with this transaction with any finder
or broker who will demand payment of any fee or commission from the other party
except as set forth on the Schedule of Exceptions, whose fee shall be paid by
the Company. The Company on the one hand, and the Investor, on the other hand,
agree to indemnify the other against and hold the other harmless from any and
all liabilities to any person claiming brokerage commissions or finder's fees on
account of services purported to have been rendered on behalf of the
indemnifying party in connection with this Agreement or the transactions
contemplated hereby.

	Effectiveness of Agreement. This Agreement shall
become effective only upon satisfaction of the conditions precedent to the
Initial Closing set forth in Article I of the Escrow Agreement.

 

 

[THIS PAGE IS INTENTIONALLY LEFT BLANK]

IN WITNESS WHEREOF, the parties hereto have caused this
Private Equity Line of Credit Agreement to be executed by the undersigned,
thereunto duly authorized, as of the date first set forth above.
Integrated Surgical Systems, Inc.

By: __________________________

Louis Kirchner

Chief Financial Officer

Triton West Group, Inc.

By:___________________________ 

E. Edward Jung

Managing Director

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

S:\MO\ISS\EQUITYLN\FRMPRC2B.DOC

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EXHIBIT A

ESCROW AGREEMENT

ESCROW AGREEMENT (this "Agreement") is made as of September
15, 2000, by and among Integrated Surgical Systems, Inc., a corporation
incorporated under the laws of the State of Delaware (the "Company"), Triton
West Group, Inc., a corporation incorporated under the laws of the Cayman
Islands ("Triton" or the "Investor"),  and Epstein Becker & Green,
P.C., having an address at 250 Park Avenue, New York, NY 10177 (the "Escrow
Agent").  Capitalized terms used but not defined herein shall have the meanings
set forth in the Private Equity Line of Credit Agreement referred to in the
first recital.

W I T N E S S E T H:

WHEREAS, the Investor will from time to time as requested by
the Company, purchase shares of the Company's Common Stock from the Company as
set forth in that certain Private Equity Line of Credit Agreement (the "Purchase
Agreement") dated the date hereof between the Investor and the Company, which
will be issued as per the terms and conditions contained herein and in the
Purchase Agreement; 

WHEREAS, the Company and the Investor have requested that the
Escrow Agent hold in escrow and then distribute the initial documents and
certain funds which are conditions precedent to the effectiveness of the
Purchase Agreement, and have further requested that upon each exercise of a Put,
the Escrow Agent hold the relevant documents and the applicable purchase price
pending receipt of certificates representing the securities issuable upon such
Put; and

NOW, THEREFORE, in consideration of the covenants and mutual
promises contained herein and other good and valuable consideration, the receipt
and legal sufficiency of which are hereby acknowledged and intending to be
legally bound hereby, the parties agree as follows:

ARTICLE 1

TERMS OF THE ORIGINAL ESCROW

1.1The parties hereby agree to establish an escrow
account with the Escrow Agent whereby the Escrow Agent shall hold the funds and
documents which are referenced in Section 7.2 of the Purchase Agreement.

1.2Upon the execution of the Purchase Agreement, the
Company shall deliver to the Escrow Agent:

(i)the original executed Registration Rights Agreement in
the form of Exhibit C to the Purchase Agreement;

 

(ii)the original executed opinion of Snow Becker Krauss
P.C., in the form of Exhibit E to the Purchase Agreement;

(iii)the sum of $16,000;

(iv)the original executed Company counterpart of this
Escrow Agreement; 

	the original executed Company counterpart of the Purchase
Agreement; and

	the original executed Warrant in the form of Exhibit D to
the Purchase Agreement.

 

The Company also shall issue to Triton West Group, Inc. 5,000
shares of Common Stock.

1.3Upon receipt of the foregoing, and receipt of executed
counterparts from Investor of the Purchase Agreement, the Registration Rights
Agreement and this Escrow Agreement, the Escrow Agent shall immediately transfer
the sum of  sixteen thousand dollars ($16,000) to Epstein Becker & Green,
P.C. ("EB&G"), 250 Park Avenue, New York, New York 10177 for the Investor's
legal and administrative costs and the Escrow Agent shall then arrange to have
the Purchase Agreement, this Escrow Agreement, the Registration Rights
Agreement, the Warrant and the opinion of counsel delivered to the appropriate
parties.

ARTICLE 2

TERMS OF THE ESCROW FOR EACH PUT

2.1(a)Each time the Company shall send a Put Notice
to the Investor as provided in the Purchase Agreement, it shall send a copy, by
facsimile, to the Escrow Agent.

(b)Each time the Investor shall purchase shares
pursuant to a Put, the Investor shall send the applicable Investment Amount of
the Put Shares to the Escrow Agent.  The Company shall promptly, but no later
than seven (7) Trading Days after delivery of the Put Notice to the Investor,
send to the account designated by the Investor via the DWAC system the Put
Shares.  In the event that the certificates representing the Put Shares are not
in an Investor's possession within seven (7) Trading Days of the date of the
Company's Put Notice, then Investor shall have the right to demand, by notice,
the return of the Investment Amount, and the Put Notice shall be deemed
cancelled.  In the event the certificates representing such Put Shares are
timely received by the Investor, the Escrow Agent shall within one (1) Trading
Day wire the Investment Amount per the written instructions of the Company, net
of:

 

	an advisory fee equal to three percent (3%) of the
Investment Amount of each Put to Triton; 

	an advisory fee equal to one-third of one percent
(0.333%) of the Commitment Amount, as to the first six Closings only, to be
allocated to Triton; and

 (ii)One Thousand Dollars ($1,000) as escrow expenses to
the Escrow Agent.

The Escrow Agent shall remit the  advisory fees to Triton in
accordance with wire instructions that will be sent to the Escrow Agent from
Triton.

ARTICLE 3

MISCELLANEOUS

3.1No waiver or any breach of any covenant or provision
herein contained shall be deemed a waiver of any preceding or succeeding breach
thereof, or of any other covenant or provision herein contained.  No extension
of time for performance of any obligation or act shall be deemed an extension of
the time for performance of any other obligation or act.  All notices or other
communications required or permitted hereunder shall be in writing, and shall be
sent as set forth in the Purchase Agreement, and if sent to 

Escrow Agent, to:

Epstein Becker & Green, P.C.

250 Park Avenue

New York, NY 10177

Attn: Robert Charron, Esq.

Telephone:(212) 351-4500

Facsimile:(212) 661-0989

 

3.2This Escrow Agreement shall be binding upon and shall
inure to the benefit of the permitted successors and permitted assigns of the
parties hereto.

 

3.3This Escrow Agreement is the final expression of, and
contains the entire agreement between, the parties with respect to the subject
matter hereof and supersedes all prior understandings with respect thereto.
This Escrow Agreement may not be modified, changed, supplemented or terminated,
nor may any obligations hereunder be waived, except by written instrument signed
by the parties to be charged or by their respective agents duly authorized in
writing or as otherwise expressly permitted herein.

3.4Whenever required by the context of this Escrow
Agreement, the singular shall include the plural and masculine shall include the
feminine.  This Escrow Agreement shall not be construed as if it had been
prepared by one of the parties, but rather as if both parties had prepared the
same.  Unless otherwise indicated, all references to Articles are to this Escrow
Agreement.

3.5The parties hereto expressly agree that this Escrow
Agreement shall be governed by, interpreted under and construed and enforced in
accordance with the laws of the State of New York.  Except as expressly set
forth herein, any action to enforce, arising out of, or relating in any way to,
any provisions of this Escrow Agreement shall brought through the American
Arbitration Association at the designated locale of New York, New York as is
more fully set forth in the Purchase Agreement.

3.6The Escrow Agent's duties hereunder may be altered,
amended, modified or revoked only by a writing signed by the Company, the
Investor and the Escrow Agent.

3.7The Escrow Agent shall be obligated only for the
performance of such duties as are specifically set forth herein and may rely and
shall be protected in relying or refraining from acting on any instrument
reasonably believed by the Escrow Agent to be genuine and to have been signed or
presented by the proper party or parties.  The Escrow Agent shall not be
personally liable for any act the Escrow Agent may do or omit to do hereunder as
the Escrow Agent while acting in good faith, excepting only its own gross
negligence or willful misconduct, and any act done or omitted by the Escrow
Agent pursuant to the advice of the Escrow Agent's attorneys-at-law (other than
Escrow Agent itself) shall be conclusive evidence of such good faith.

3.8The Escrow Agent is hereby expressly authorized to
disregard any and all warnings given by any of the parties hereto or by any
other person or corporation, excepting only orders or process of courts of law
and is hereby expressly authorized to comply with and obey orders, judgments or
decrees of any court.  In case the Escrow Agent obeys or complies with any such
order, judgment or decree, the Escrow Agent shall not be liable to any of the
parties hereto or to any other person, firm or corporation by reason of such
decree being subsequently reversed, modified, annulled, set aside, vacated or
found to have been entered without jurisdiction.

3.9The Escrow Agent shall not be liable in any respect on
account of the identity, authorization or rights of the parties executing or
delivering or purporting to 

execute or deliver the Purchase Agreement or any documents or
papers deposited or called for thereunder or hereunder.

 

3.10The Escrow Agent shall be entitled to employ such
legal counsel and other experts as the Escrow Agent may deem necessary properly
to advise the Escrow Agent in connection with the Escrow Agent's duties
hereunder, may rely upon the advice of such counsel, and may pay such counsel
reasonable compensation therefor.  The Escrow Agent has acted as legal
counsel for the Investor, and may continue to act as legal counsel for the
Investor, from time to time, notwithstanding its duties as the Escrow Agent
hereunder.  The Company consents to the Escrow Agent in such capacity as legal
counsel for the Investor and waives any claim that such representation
represents a conflict of interest on the part of the Escrow Agent.  The Company
understands that the Investor and the Escrow Agent are relying explicitly on the
foregoing provision in entering into this Escrow Agreement.

3.11The Escrow Agent's responsibilities as escrow agent
hereunder shall terminate if the Escrow Agent shall resign by written notice to
the Company and the Investor.  In the event of any such resignation, the
Investor and the Company shall appoint a successor Escrow Agent.

3.12If the Escrow Agent reasonably requires other or
further instruments in connection with this Escrow Agreement or obligations in
respect hereto, the necessary parties hereto shall join in furnishing such
instruments.

3.13It is understood and agreed that should any dispute
arise with respect to the delivery and/or ownership or right of possession of
the documents or the escrow funds held by the Escrow Agent hereunder, the Escrow
Agent is authorized and directed in the Escrow Agent's sole discretion (1) to
retain in the Escrow Agent's possession without liability to anyone all or any
part of said documents or the escrow funds until such disputes shall have been
settled either by mutual written agreement of the parties concerned by a final
order, decree or judgment or a court of competent jurisdiction after the time
for appeal has expired and no appeal has been perfected, but the Escrow Agent
shall be under no duty whatsoever to institute or defend any such proceedings or
(2) to deliver the escrow funds and any other property and documents held by the
Escrow Agent hereunder to a state or federal court having competent subject
matter jurisdiction and located in the State and City of New York in accordance
with the applicable procedure therefor.

3.14The Company and the Investor agree jointly and
severally to indemnify and hold harmless the Escrow Agent and its partners,
employees, agents and representatives from any and all claims, liabilities,
costs or expenses in any way arising from or relating to the duties or
performance of the Escrow Agent hereunder or the transactions contemplated
hereby or by the Purchase Agreement other than any such claim, liability, cost
or expense to the extent the same shall have been determined by 

final, unappealable judgment of a court of competent
jurisdiction to have resulted from the gross negligence or willful misconduct of
the Escrow Agent.

 

 

IN WITNESS WHEREOF, the parties hereto have executed this
Escrow Agreement as of the date first set forth above.

 
Integrated Surgical Systems, Inc.

By:________________________

	Louis Kirchner

	Chief Financial Officer

 

 

 
Triton West Group, Inc.:

 

By:__________________________

      Name:  E. Edward Jung

      Title:    Managing Director

 
ESCROW AGENT:

EPSTEIN BECKER & GREEN, P.C.

By:____________________________

      Name:

      Title:

 

 

 

EXHIBIT B

 

 

PUT NOTICE/COMPLIANCE CERTIFICATE

Integrated Surgical Systems, Inc.

The undersigned hereby certifies, with respect to shares
of Common Stock of Integrated Surgical Systems, Inc. (the "Company")
issuable in connection with this Put Notice and Compliance Certificate dated
_____________ (the "Notice"), delivered pursuant to Article II of the
Private Equity Line of Credit Agreement dated as of September 15, 2000 (the
"Agreement"), as follows:

1. The undersigned is the duly appointed Chief Executive
Officer of the Company.

2. The representations and warranties of the Company set
forth in the Agreement are true and correct in all material respects as though
made on and as of the date hereof and all SEC Documents are as represented in
Section 4.5 of the Agreement.

3. The Company has performed in all material respects all
covenants and agreements to be performed by the Company on or prior to the date
of this Put Notice and has complied in all material respects with all
obligations and conditions contained in the Agreement. 

4.The Investment Amount is $___________.

 

The undersigned has executed this Certificate this ____ day
of ________, _____.

 
Integrated Surgical Systems, Inc.

 

____________________

Louis Kirchner

Chief Financial Officer

 

 

 

 

 

 

 

EXHIBIT C

REGISTRATION RIGHTS AGREEMENT

THIS REGISTRATION RIGHTS AGREEMENT, dated as of September 15,
2000, among Integrated Surgical Systems, a corporation incorporated under the
laws of the State of Delaware (the "Company") and Triton West Group,
Inc., a corporation incorporated under the laws of the Cayman Islands
("Triton" or the "Investor").

WHEREAS, simultaneously with the execution and delivery of
this Agreement, pursuant to a Private Equity Line of Credit Agreement dated the
date hereof (the "Purchase Agreement") the Investor has committed to
purchase up to $12,000,000 worth of the Company's Common Stock (terms not
defined herein shall have the meanings ascribed to them in the Purchase
Agreement); and

WHEREAS, the Company desires to grant to the Investor the
registration rights set forth herein with respect to the Put Shares and the
Blackout Shares issuable upon exercise of the Company's  Put rights from time to
time and the Warrant Shares (hereinafter referred to as the "Stock" or
"Securities" of the Company).

NOW, THEREFORE, the parties hereto mutually agree as
follows:

Section 1. Registrable Securities.  As used herein the
term "Registrable Security" means the Securities until (i) all Put
Shares and Warrant Shares have been disposed of pursuant to the Registration
Statement, (ii) all Put Shares and Warrant Shares have been sold under
circumstances under which all of the applicable conditions of Rule 144 (or any
similar provision then in force) under the Securities Act ("Rule 144")
are met, (iii) all Put Shares and Warrant Shares have been otherwise transferred
to persons who may trade such Securities without restriction under the
Securities Act, and the Company has delivered a new certificate or other
evidence of ownership for such Put Shares and/or Warrant Shares not bearing a
restrictive legend or (iv) such time as, in the opinion of counsel to the
Company, all Put Shares and Warrant Shares may be sold without any time, volume
or manner limitations pursuant to Rule 144(k) (or any similar provision then in
effect) under the Securities Act. The term "Registrable Securities"
means any and/or all of the securities falling within the foregoing definition
of a "Registrable Security".  In the event of any merger,
reorganization, consolidation, recapitalization or other change in corporate
structure affecting the Common Stock, such adjustment shall be deemed to be made
in the definition of "Registrable Security" as is appropriate in order
to prevent any dilution or enlargement of the rights granted pursuant to this
Agreement.

Section 2. Restrictions on Transfer.  The Investor
acknowledges and understands that in the absence of an effective Registration
Statement authorizing the resale of the Securities as provided herein, the
Securities are "restricted securities" as defined in Rule 144
promulgated under the Act.  The Investor understands that no disposition or
transfer of the Securities  may be made by Investor in the absence of (i) an
opinion of counsel to the Investor, in form and substance reasonably
satisfactory to the Company, that such transfer may be made without registration
under the Securities Act or (ii) such registration.

With a view to making available to the Investor the benefits
of Rule 144 under the Securities Act or any other similar rule or regulation of
the Commission that may at any time permit the Investor to sell securities of
the Company to the public without registration ("Rule 144"), the
Company agrees to:

(a)comply with the provisions of paragraph (c)(1) of Rule
144; and

(b)file with the Commission in a timely manner all
reports and other documents required to be filed by the Company pursuant to
Section 13 or 15(d) under the Exchange Act; and, if at any time it is not
required to file such reports but in the past had been required to or did file
such reports, it will, upon the request of any Investor, make available other
information as required by, and so long as necessary to permit sales of its
Registrable Securities pursuant to, Rule 144.

Section 3. Registration Rights With Respect to the
Securities.

(a)The Company agrees that it will prepare and file with
the Securities and Exchange Commission ("Commission"), within forty-
five days (45) days after the date hereof, a registration statement (on Form SB-
2, or other appropriate form of registration statement) under the Securities Act
(the "Registration Statement"), at the sole expense of the Company
(except as provided in Section 3(c) hereof), in respect of all permitted holders
of Securities, so as to permit a public offering and resale of the Securities
under the Act by Investor.

The Company shall use its best efforts to cause the
Registration Statement to become effective within one hundred and twenty (120)
days from the date hereof, or, if earlier, within ten (10) days of SEC clearance
to request acceleration of effectiveness.  In the event that the SEC decides to
review the Company's Registration Statement, the Company shall have an
additional thirty (30) days to amend and cause such registration to become
effective. If the Registration Statement is not declared effective by January
30, 2001, this Agreement and the Purchase Agreement shall terminate and the
Company shall pay Investor the sum of $25,000 as liquidated damages. The number
of shares designated in the Registration Statement to be registered shall be
24,035,000 and shall include appropriate language regarding reliance upon Rule
416 to the extent permitted by the Commission. The number of shares may be
increased following receipt of stockholder approval of the transactions
contemplated hereby pursuant to the rules of the Principal Market. The Company
will notify the Investor of the effectiveness of the Registration Statement
within one Trading Day of such event.

(b)The Company will maintain the Registration Statement
or post-effective amendment filed under this Section 3 hereof effective under
the Securities Act until the earlier of (i) the date that none of the Securities
are or may become issued and outstanding, (ii) the date that all of the
Securities have been sold pursuant to the Registration Statement, (iii) the date
the holders thereof receive an opinion of counsel to the Company, which counsel
shall be reasonably acceptable to the Investor, that the Securities may be sold
under the provisions of Rule 144 without limitation as to volume, (iv) all
Securities have been otherwise transferred to persons who may trade such shares
without restriction under the Securities Act, and the Company has delivered a
new certificate or other evidence of ownership for such securities not bearing a
restrictive legend, or (v) all Securities may be sold without any time, volume
or manner limitations pursuant to Rule 144(k) or any similar provision then in
effect under the Securities Act in the opinion of counsel to the Company, which
counsel shall be reasonably acceptable to the Investor (the "Effectiveness
Period").

(c)All fees, disbursements and out-of-pocket expenses and
costs incurred by the Company in connection with the preparation and filing of
the Registration Statement under subparagraph 3(a) and in complying with
applicable securities and Blue Sky laws (including, without limitation, all
attorneys' fees of the Company) shall be borne by the Company.  The Investor
shall bear the cost of underwriting and/or brokerage discounts, fees and
commissions, if any, applicable to the Securities being registered and the fees
and expenses of its counsel. The Investor and its counsel shall have a
reasonable period, not to exceed ten (10) Trading Days, to review the proposed
Registration Statement or any amendment thereto, prior to filing with the
Commission, and the Company shall provide the Investor with copies of any
comment letters received from the Commission with respect thereto within two (2)
Trading Days of receipt thereof.  The Company shall make reasonably available
for inspection by the Investor, any underwriter participating in any disposition
pursuant to the Registration Statement, and any attorney, accountant or other
agent retained by the Investor or any such underwriter all relevant financial
and other records, pertinent corporate documents and properties of the Company
and its subsidiaries, and cause the Company's officers, directors and employees
to supply all information reasonably requested by the Investor or any such
underwriter, attorney, accountant or agent in connection with the Registration
Statement, in each case, as is customary for similar due diligence examinations;
provided, however, that all records, information and documents that are
designated in writing by the Company, in good faith, as confidential,
proprietary or containing any material non-public information shall be kept
confidential by the Investor and any such underwriter, attorney, accountant or
agent (pursuant to an appropriate confidentiality agreement in the case of any
such Investor or agent), unless such disclosure is made pursuant to judicial
process in a court proceeding (after first giving the Company an opportunity
promptly to seek a protective order or otherwise limit the scope of the
information sought to be disclosed) or is required by law, or such records,
information or documents become available to the public generally or through a
third party not in violation of an accompanying obligation of confidentiality;
and provided further that, if the foregoing inspection and information gathering
would otherwise disrupt the Company's conduct of its business, such inspection
and information gathering shall, to the maximum extent possible, be coordinated
on behalf of the Investors and the other parties entitled thereto by one firm of
counsel designed by and on behalf of the majority in interest of the Investor
and other parties.  The Company shall qualify any of the securities for sale in
such states as the Investor reasonably designate and shall furnish
indemnification in the manner provided in Section 6 hereof.  However, the
Company shall not be required to qualify in any state which will require an
escrow or other restriction relating to the Company and/or the sellers, or which
will require the Company to qualify to do business in such state or require the
Company to file therein any general consent to service of process.  The Company
at its expense will supply the Investor with copies of the Registration
Statement and the prospectus included therein and other related documents in
such quantities as may be reasonably requested by the Investor.

(d)The Company shall not be required by this Section 3 to
include  Investor's Securities in any Registration Statement which is to be
filed if, in the opinion of counsel for both the Investor and the Company (or,
should they not agree, in the opinion of another counsel experienced in
securities law matters acceptable to counsel for the Investors and the Company)
the proposed offering or other transfer as to which such registration is
requested is exempt from applicable federal and state securities laws and would
result in all purchasers or transferees obtaining securities which are not
"restricted securities", as defined in Rule 144 under the Securities
Act.

(e)If at any time or from time to time after the
effective date of the Registration Statement, the Company notifies the Investor
in writing of the existence of a Potential Material Event (as defined in Section
3(f) below), the Investor shall not offer or sell any Securities or engage in
any other transaction involving or relating to Securities, from the time of the
giving of notice with respect to a Potential Material Event until the Investor
receive written notice from the Company that such Potential Material Event
either has been disclosed to the public or no longer constitutes a Potential
Material Event; provided, however, that if the Company so suspends the right to
such holders of Securities for more than thirty (30) days in the aggregate
during any twelve month period, during the periods the Registration Statement is
required to be in effect such excess periods shall be a Registration Default,
and shall entitle the Investor to receive Blackout Shares as provided in the
Purchase Agreement.  If a Potential Material Event shall occur prior to the date
the Registration Statement is filed, then the Company's obligation to file the
Registration Statement shall be delayed without penalty for not more than thirty
(30) days.  The Company must give the Investor notice in writing at least two
(2) Trading Days prior to the first day of the blackout period, if lawful to do
so.

(f)"Potential Material Event" means any of the
following: (a) the possession by the Company of material information that is not
ripe for disclosure in a registration statement, as determined in good faith by
the Chief Executive Officer or the Board of Directors of the Company or that
disclosure of such information in the Registration Statement would be
detrimental to the business and affairs of the Company; or (b) any material
engagement or activity by the Company which would, in the good faith
determination of the Chief Executive Officer or the Board of Directors of the
Company, be adversely affected by disclosure in a registration statement at such
time, which determination shall be accompanied by a good faith determination by
the Chief Executive Officer or the Board of Directors of the Company that the
Registration Statement would be materially misleading absent the inclusion of
such information.

Section 4. Cooperation with Company.  The Investor
will cooperate with the Company in all respects in connection with this
Agreement, including timely supplying all information reasonably requested by
the Company (which shall include all information regarding the Investor and
proposed manner of sale of the Registrable Securities required to be disclosed
in the Registration Statement) and executing and returning all documents
reasonably requested in connection with the registration and sale of the
Registrable Securities. The Investor shall consent to be named as an underwriter
in the Registration Statement.

Section 5. Registration Procedures.     If and
whenever the Company is required by any of the provisions of this Agreement to
effect the registration of any of the Registrable Securities under the Act, the
Company shall (except as otherwise provided in this Agreement), as expeditiously
as possible, subject to the Investor's assistance and cooperation as reasonably
required:

(a)prepare and file with the Commission such amendments
and supplements to the Registration Statement and the prospectus used in
connection therewith as may be necessary to keep such registration statement
effective and to comply with the provisions of the Act with respect to the sale
or other disposition of all securities covered by such registration statement
whenever the Investor of such Registrable Securities shall desire to sell or
otherwise dispose of the same (including prospectus supplements with respect to
the sales of securities from time to time in connection with a registration
statement pursuant to Rule 415 promulgated under the Act) and (ii) take all
lawful action such that each of (A) the Registration Statement and any amendment
thereto does not, when it becomes effective, contain 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 and (B) the Prospectus
forming part of the Registration Statement, and any amendment or supplement
thereto, does not at any time during the Registration Period 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, in light of the
circumstances under which they were made, not misleading.

 (b)prior to the filing with the Commission of any
Registration Statement (including any amendments thereto) and the distribution
or delivery of any prospectus (including any supplements thereto), provide draft
copies thereof to the Investor and reflect in such documents all such comments
as the Investor (and its counsel) reasonably may propose and (ii) furnish to the
Investor such numbers of copies of a prospectus including a preliminary
prospectus or any amendment or supplement to any prospectus, as applicable, in
conformity with the requirements of the Act, and such other documents, as the
Investor may reasonably request in order to facilitate the public sale or other
disposition of the securities owned by the Investor;

(c)register and qualify the Registrable Securities
covered by the Registration Statement under such other securities or blue sky
laws of such jurisdictions as the Investor shall reasonably request (subject to
the limitations set forth in Section 3(d) above), and do any and all other acts
and things which may be necessary or advisable to enable the Investor to
consummate the public sale or other disposition in such jurisdiction of the
securities owned by the Investor, except that the Company shall not for any such
purpose be required to qualify to do business as a foreign corporation in any
jurisdiction wherein it is not so qualified or to file therein any general
consent to service of process;

(d)list such Registrable Securities on the Principal
Market, and any other exchange on which the Common Stock of the Company is then
listed, if the listing of such Registrable Securities is then permitted under
the rules of such exchange or Nasdaq;

(e)notify the Investor at any time when a prospectus
relating thereto covered  by the Registration Statement is required to be
delivered under the Act, of the happening of any event of which it has knowledge
as a result of which the prospectus included in the 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 in the light of  the circumstances then
existing, and the Company shall prepare and file a curative amendment under
Section 5(a) as quickly as commercially possible;

(f)as promptly as practicable after becoming aware of
such event, notify the Investor who holds Registrable Securities being sold (or,
in the event of an underwritten offering, the managing underwriters) of the
issuance by the Commission or any state authority of any stop order or other
suspension of the effectiveness of the Registration Statement at the earliest
possible time and take all lawful action to effect the withdrawal, recession or
removal of such stop order or other suspension;

(g)cooperate with the Investor to facilitate the
timely preparation and delivery of certificates for the Registrable Securities
to be offered pursuant to the Registration Statement and enable such
certificates for the Registrable Securities to be in such denominations or
amounts, as the case may be, as the Investor reasonably may request and
registered in such names as the Investor may request; and, within three Trading
Days after a Registration Statement which includes Registrable Securities is
declared effective by the Commission, deliver and cause legal counsel selected
by the Company to deliver to the transfer agent for the Registrable Securities
(with a copy to the Investor) an appropriate instruction and, to the extent
necessary, an opinion of such counsel;

(h)take all such other lawful actions reasonably
necessary to expedite and facilitate the disposition by the Investor of the
Registrable Securities in accordance with the intended methods therefor provided
in the prospectus which are customary for issuers to perform under the
circumstances;

(i)in the event of an underwritten offering, promptly
include or incorporate in a Prospectus supplement or post-effective amendment to
the Registration Statement such information as the managers reasonably agree
should be included therein and to which the Company does not reasonably object
and make all required filings of such Prospectus supplement or post-effective
amendment as soon as practicable after it is notified of the matters to be
included or incorporated in such Prospectus supplement or post-effective
amendment; and

(j)maintain a transfer agent and registrar for its
Common Stock.

 

Section 6.  Indemnification. 

(a)The Company agrees to indemnify and hold harmless the
Investor and each  person, if any, who controls the Investor within the meaning
of the Securities Act ("Distributing Investor") against any losses,
claims, damages or liabilities, joint or several (which shall, for all purposes
of this Agreement, include, but not be limited to, all reasonable costs of
defense and investigation and all reasonable attorneys' fees), to which the
Distributing Investor may become subject, under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the Registration Statement, or any
related preliminary prospectus, final prospectus or amendment or supplement
thereto, or arise out of or are based upon 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; provided, however, that the Company will
not be liable in any such case to the extent that any such loss, claim, damage
or liability arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in the Registration
Statement, preliminary prospectus, final prospectus or amendment  or supplement
thereto in reliance upon, and in conformity with, written information furnished
to the Company by the Distributing Investor, specifically for use in the
preparation thereof. This Section 6(a) shall not inure to the benefit of any
Distributing Investor with respect to any person asserting such loss, claim,
damage or liability who purchased the Registrable Securities which are the
subject thereof if the Distributing Investor failed to send or give (in
violation of the Securities Act or the rules and regulations promulgated
thereunder) a copy of the prospectus contained in such Registration Statement to
such person at or prior to the written confirmation to such person of the sale
of such Registrable Securities, where the Distributing Investor was obligated to
do so under the Securities Act or the rules and regulations promulgated
thereunder.  This indemnity agreement will be in addition to any liability which
the Company may otherwise have.

	Each  Distributing Investor agrees that it will indemnify
and hold harmless the Company, and each officer, director of the Company or
person, if any, who controls the Company within the meaning of the Securities
Act, against any losses, claims, damages or liabilities (which shall, for all
purposes of this Agreement, include, but not be limited to, all reasonable costs
of defense and investigation and all reasonable attorneys' fees) to which the
Company or any such officer, director or controlling person may become subject
under the Securities Act or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of any material fact contained
in the Registration Statement, or any related preliminary prospectus, final
prospectus or amendment or supplement thereto, or arise out of or are based upon
the omission or the alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
but in each case only to the extent that such untrue statement or alleged untrue
statement or omission or alleged omission was made in the Registration
Statement, preliminary prospectus, final prospectus or amendment or supplement
thereto in reliance upon, and in conformity with, written information furnished
to the Company by such Distributing Investor, specifically for use in the
preparation thereof. This indemnity agreement will be in addition to any
liability which the Distributing Investor may otherwise have.

(c)Promptly after receipt by an indemnified party under
this Section 6 of notice of the commencement of any action, such indemnified
party will, if a claim in respect thereof is to be made against the indemnifying
party under this Section 6, notify the indemnifying party of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
the indemnifying party from any liability which it may have to any indemnified
party except to the extent of actual prejudice demonstrated by the indemnifying
party.  In case any such action is brought against any indemnified party, and it
notifies the indemnifying party of the commencement thereof, the indemnifying
party will be entitled to participate in, and, to the extent that it may wish,
jointly with any other indemnifying party similarly notified, assume the defense
thereof, subject to the provisions herein stated and after notice from the
indemnifying party to such indemnified party of its election so to assume the
defense thereof, the indemnifying party will not be liable to such indemnified
party under this Section 6 for any legal or other expenses subsequently incurred
by such indemnified party in connection with the defense thereof other than
reasonable costs of investigation, unless the indemnifying party shall not
pursue the action to its final conclusion.  The indemnified party shall have the
right to employ separate counsel in any such action and to participate in the
defense thereof, but the fees and expenses of such counsel shall not be at the
expense of the indemnifying party if the indemnifying party has assumed the
defense of the action with counsel reasonably satisfactory to the indemnified
party; provided that if the indemnified party is the Distributing Investor, the
fees and expenses of such counsel shall be at the expense of the indemnifying
party if (i) the employment of such counsel has been specifically authorized in
writing by the indemnifying party, or (ii) the named parties to any such action
(including any impleaded parties) include both the Distributing Investor and the
indemnifying party and the Distributing Investor shall have been advised by such
counsel that there may be one or more legal defenses available to the
indemnifying party different from or in conflict with any legal defenses which
may be available to the Distributing Investor (in which case the indemnifying
party shall not have the right to assume the defense of such action on behalf of
the Distributing Investor, it being understood, however, that the indemnifying
party shall, in connection with any one such action or separate but
substantially similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances, be liable only for the reasonable
fees and expenses of one separate firm of attorneys for the Distributing
Investor, which firm shall be designated in writing by the Distributing
Investor).  No settlement of any action against an indemnified party shall be
made without the prior written consent of the indemnified party, which consent
shall not be unreasonably withheld.

 

Section 7. Contribution.    In order to provide for
just and equitable contribution under the Securities Act in any case in which
(i) the indemnified party makes a claim for indemnification pursuant to Section
6 hereof but is judicially determined (by the entry of a final judgment or
decree by a court of competent jurisdiction and the expiration of time to appeal
or the denial of the last right of appeal) that such indemnification may not be
enforced in such case notwithstanding the fact that the express provisions of
Section 6 hereof provide for indemnification in such case, or (ii) contribution
under the Securities Act may be required on the part of any indemnified party,
then the Company and the applicable Distributing Investor shall contribute to
the aggregate losses, claims, damages or liabilities to which they may be
subject (which shall, for all purposes of this Agreement, include, but not be
limited to, all reasonable costs of defense and investigation and all reasonable
attorneys' fees), in either such case (after contribution from others) on the
basis of relative fault as well as any other relevant equitable considerations.
The relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company on the one hand or the applicable Distributing Investor
on the other hand, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and the Distributing Investor agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in this Section 7.  The amount paid or
payable by an indemnified party as a result of the losses, claims, damages or
liabilities (or actions in respect thereof) referred to above in this Section 7
shall be deemed to include any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending any such
action or claim. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.

Notwithstanding any other provision of this Section 7, in no
event shall any (i) Investor be required to undertake liability to any person
under this Section 7 for any amounts in excess of the dollar amount of the net
proceeds to be received by such Investor from the sale of such Investor's
Registrable Securities (after deducting any fees, discounts and commissions
applicable thereto) pursuant to any Registration Statement under which such
Registrable Securities are to be registered under the Securities Act and (ii)
underwriter be required to undertake liability to any person hereunder for any
amounts in excess of the aggregate discount, commission or other compensation
payable to such underwriter with respect to the Registrable Securities
underwritten by it and distributed pursuant to the Registration
Statement.

Section 8. Notices.    All notices, demands, requests,
consents, approvals, and other communications required or permitted hereunder
shall be in writing and, unless otherwise specified herein, shall be delivered
as set forth in the Purchase Agreement. Either party hereto may from time to
time change its address or facsimile number for notices under this Section 8 by
giving at least ten (10) days  prior written notice of such changed address
or facsimile number to the other party hereto.

 

Section 9.  Assignment.

 Neither this Agreement nor any rights of the Investor or the
Company hereunder may be assigned by either party to any other person.
Notwithstanding the foregoing, (a) the provisions of this Agreement shall inure
to the benefit of, and be enforceable by, any transferee of any of the Common
Stock purchased by the Investor pursuant to the Purchase Agreement, and (b) upon
the prior written consent of the Company, which consent shall not be
unreasonably withheld or delayed in the case of an assignment to an affiliate of
an Investor, the Investor's interest in this Agreement may be assigned at any
time, in whole or in part, to any other person or entity (including any
affiliate of the Investor) who agrees to be bound hereby.

 

Section 10.  Additional Covenants of the Company.

The Company agrees that at such time as it meets all the
requirements for the use of Securities Act Registration Statement on Form S-3 it
shall file all reports and information required to be filed by it with the
Commission in a timely manner and take all such other action so as to maintain
such eligibility for the use of such form.

 

Section 11.  Counterparts/Facsimile.  This Agreement
may be executed in two or more counterparts, each of which shall constitute an
original, but all of which, when together shall constitute but one and the same
instrument, and shall become effective when one or more counterparts have been
signed by each party hereto and delivered to the other party.  In lieu of the
original, a facsimile transmission or copy of the original shall be as effective
and enforceable as the original.

 

Section 12.  Remedies. 

 The remedies provided in this Agreement are cumulative and
not exclusive of any remedies provided by law.  If any term, provision, covenant
or restriction of this Agreement is held by a court of competent jurisdiction to
be invalid, illegal, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions set forth herein shall remain in full
force and effect and shall in no way be affected, impaired or invalidated, and
the parties hereto shall use their best efforts to find and employ an
alternative means to achieve the same or substantially the same result as that
contemplated by such term, provision, covenant or restriction.  It is hereby
stipulated and declared to be the intention of the parties that they would have
executed the remaining terms, provisions, covenants and restrictions without
including any of such that may be hereafter declared invalid, illegal, void or
unenforceable.

 

Section 13.  Conflicting Agreements.    The Company
shall not enter into any agreement with respect to its securities that is
inconsistent with the rights granted to the holders of Registrable Securities in
this Agreement or otherwise prevents the Company from complying with all of its
obligations hereunder.

 

Section 14.  Headings.    The headings in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.

 

Section 15.  Governing Law, Arbitration. 

 This Agreement shall be governed by and construed in
accordance with the laws of the State of New York applicable to contracts made
in New York by persons domiciled in New York City and without regard to its
principles of conflicts of laws.  Any dispute under this Agreement shall be
submitted to arbitration under the American Arbitration Association (the
"AAA") in New York City, New York, and shall be finally and
conclusively determined by the decision of a board of arbitration consisting of
three (3) members (hereinafter referred to as the "Board of
Arbitration") selected as according to the rules governing the AAA.  The
Board of Arbitration shall meet on consecutive business days in New York City,
New York, and shall reach and render a decision in writing (concurred in by a
majority of the members of the Board of Arbitration) with respect to the amount,
if any, which the losing party is required to pay to the other party in respect
of a claim filed.  In connection with rendering its decisions, the Board of
Arbitration shall adopt and follow the laws of the State of New York.  To the
extent practical, decisions of the Board of Arbitration shall be rendered no
more than thirty (30) calendar days following commencement of proceedings with
respect thereto. The Board of Arbitration shall cause its written decision to be
delivered to all parties involved in the dispute. The Board of Arbitration shall
be authorized and is directed to enter a default judgment against any party
refusing to participate in the arbitration proceeding with thirty days of any
deadline for such participation. Any decision made by the Board of Arbitration
(either prior to or after the expiration of such thirty (30) calendar day
period) shall be final, binding and conclusive on the parties to the dispute,
and entitled to be enforced to the fullest extent permitted by law and entered
in any court of competent jurisdiction.  The non-prevailing party to any
arbitration (as determined by the Board of Arbitration) shall pay the expenses
of the prevailing party, including reasonable attorneys' fees, in connection
with such arbitration.  Any party shall have the right to seek injunctive relief
from any court of competent jurisdiction in any case where such relief is
available, and the prevailing party shall be entitled to recover its costs,
including reasonable attorneys' fees, in connection therewith.

 

Section 16.  Severability.    If any provision of this
Agreement shall for any reason be held invalid or unenforceable, such invalidity
or unenforceability shall not affect any other provision hereof and this
Agreement shall be construed as if such invalid or unenforceable provision had
never been contained herein.  Terms not otherwise defined herein shall be
defined in accordance with the Agreement.

 

IN WITNESS WHEREOF, the parties hereto have caused this
Registration Rights Agreement to be duly executed, on the day and year first
above written.

Integrated Surgical Systems, Inc.

By:_________________________

Louis Kirchner

Chief Financial Officer 

 
Triton West Group, Inc.

By: _________________________

Name:  E. Edward Jung
Title:     Managing Director

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EXHIBIT D

NEITHER THIS WARRANT NOR THE SHARES ISSUABLE UPON
EXERCISE HEREOF HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT") OR ANY OTHER APPLICABLE SECURITIES LAWS
IN RELIANCE UPON AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND SUCH OTHER SECURITIES LAWS.  NEITHER THIS WARRANT NOR THE
SHARES ISSUABLE UPON EXERCISE HEREOF MAY BE SOLD, PLEDGED, TRANSFERRED,
ENCUMBERED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OR IN A TRANSACTION WHICH IS EXEMPT FROM
REGISTRATION UNDER THE PROVISIONS OF THE SECURITIES ACT. 

STOCK PURCHASE WARRANT

 

To Purchase 35,000 Shares of Common Stock of

Integrated Surgical Systems, Inc.

THIS CERTIFIES that, for value received, Triton West Group,
Inc. (the "Holder"), is entitled, upon the terms and subject to the
conditions hereinafter set forth, at any time on or after March 15, 2001 (the
"Initial Exercise Date") and on or prior to the close of business on
September 14, 2003 (the "Termination Date"), but not thereafter, to
subscribe for and purchase from Integrated Surgical Systems, Inc., a corporation
incorporated in Delaware (the "Company"), up to Thirty-Five Thousand
(35,000) shares (the "Warrant Shares") of common stock, $.01 par
value, of the Company (the "Common Stock").  The purchase price of one
share of Common Stock (the "Exercise Price") under this Warrant shall
be $0.859 [125% of the Market Price determined as of the date of the Purchase
Agreement.] The Exercise Price and the number of shares for which the Warrant is
exercisable shall be subject to adjustment as provided herein. In the event of
any conflict between the terms of this Warrant and the Private Equity Line of
Credit Agreement dated as of September 15, 2000 pursuant to which this Warrant
has been issued (the "Purchase Agreement"), the Purchase Agreement
shall control. Capitalized terms used and not otherwise defined herein shall
have the meanings set forth for such terms in the Purchase Agreement.

 

1.Title to Warrant.  Prior to the Termination Date
and subject to compliance with applicable laws, this Warrant and all rights
hereunder are transferable, in whole or in part, at the office or agency of the
Company by the holder hereof in person or by duly authorized attorney, upon
surrender of this Warrant together with the Assignment Form annexed hereto
properly endorsed.

2.Authorization of Shares.  The Company covenants
that all shares of Common Stock which may be issued upon the exercise of rights
represented by this Warrant will, upon exercise of the rights represented by
this Warrant, be duly authorized, validly issued, fully paid and nonassessable
and free from all taxes, liens and charges in respect of the issue thereof
(other than taxes in respect of any transfer occurring contemporaneously with
such issue).

3.Exercise of Warrant.  Except as provided in
Section 4 herein, exercise of the purchase rights represented by this Warrant
may be made at any time or times on or after the Initial Exercise Date, and
before the close of business on the Termination Date by the surrender of this
Warrant and the Notice of Exercise Form annexed hereto duly executed, at the
office of the Company (or such other office or agency of the Company as it may
designate by notice in writing to the registered holder hereof at the address of
such holder appearing on the books of the Company) and upon payment of the
Exercise Price of the shares thereby purchased by wire transfer or cashier's
check drawn on a United States bank, the holder of this Warrant shall be
entitled to receive a certificate for the number of shares of Common Stock so
purchased. Certificates for shares purchased hereunder shall be delivered to the
holder hereof within three (3) Trading Days after the date on which this Warrant
shall have been exercised as aforesaid. This Warrant shall be deemed to have
been exercised and such certificate or certificates shall be deemed to have been
issued, and Holder or any other person so designated to be named therein shall
be deemed to have become a holder of record of such shares for all purposes, as
of the date the Warrant has been exercised by payment to the Company of the
Exercise Price and all taxes required to be paid by Holder, if any, pursuant to
Section 5 prior to the issuance of such shares, have been paid.  If this Warrant
shall have been exercised in part, the Company shall, at the time of delivery of
the certificate or certificates representing Warrant Shares, deliver to Holder a
new Warrant evidencing the rights of Holder to purchase the unpurchased shares
of Common Stock called for by this Warrant, which new Warrant shall in all other
respects be identical with this Warrant. If no registration statement is
effective permitting the resale of the shares of Common Stock issued upon
exercise of this Warrant at any time commencing one year after the issuance date
hereof, then this Warrant shall also be exercisable by means of a "cashless
exercise" in which the holder shall be entitled to receive a certificate
for the number of shares equal to the quotient obtained by dividing [(A-B) (X)]
by (A), where:

(A) = the average of the high and low trading prices per
share of Common Stock  on the Trading Day preceding the date of such
election;

(B) =  the Exercise Price of the Warrants; and 

(X) = the number of shares issuable upon exercise of the
Warrants in accordance with the terms of this Warrant.

4.No Fractional Shares or Scrip.  No fractional
shares or scrip representing fractional shares shall be issued upon the exercise
of this Warrant.  As to any fraction of a share which Holder would otherwise be
entitled to purchase upon such exercise, the Company shall pay a cash adjustment
in respect of such final fraction in an amount equal to the Exercise Price.

5.Charges, Taxes and Expenses.  Issuance of
certificates for shares of Common Stock upon the exercise of this Warrant shall
be made without charge to the holder hereof for any issue or transfer tax or
other incidental expense in respect of the issuance of such certificate, all of
which taxes and expenses shall be paid by the Company, and such certificates
shall be issued in the name of the holder of this Warrant or in such name or
names as may be directed by the holder of this Warrant; provided, however, that
in the event certificates for shares of Common Stock are to be issued in a name
other than the name of the holder of this Warrant, this Warrant when surrendered
for exercise shall be accompanied by the Assignment Form attached hereto duly
executed by the holder hereof; and the Company may require, as a condition
thereto, the payment of a sum sufficient to reimburse it for any transfer tax
incidental thereto.

6.Closing of Books.  The Company will not close
its shareholder books or records in any manner which prevents the timely
exercise of this Warrant.

7.Transfer, Division and Combination.  (a) Subject
to compliance with any applicable securities laws, transfer of this Warrant and
all rights hereunder, in whole or in part, shall be registered on the books of
the Company to be maintained for such purpose, upon surrender of this Warrant at
the principal office of the Company, together with a written assignment of this
Warrant substantially in the form attached hereto duly executed by Holder or its
agent or attorney and funds sufficient to pay any transfer taxes payable upon
the making of such transfer.  Upon such surrender and, if required, such
payment, the Company shall execute and deliver a new Warrant or Warrants in the
name of the assignee or assignees and in the denomination or denominations
specified in such instrument of assignment, and shall issue to the assignor a
new Warrant evidencing the portion of this Warrant not so assigned, and this
Warrant shall promptly be cancelled.  A Warrant, if properly assigned, may be
exercised by a new holder for the purchase of shares of Common Stock without
having a new Warrant issued.

(b)This Warrant may be divided or combined
with other Warrants upon presentation hereof at the aforesaid office of the
Company, together with a written notice specifying the names and denominations
in which new Warrants are to be issued, signed by Holder or its agent or
attorney.  Subject to compliance with Section 7(a), as to any transfer which may
be involved in such division or combination, the Company shall execute and
deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be
divided or combined in accordance with such notice.

(c)The Company shall prepare, issue and
deliver at its own expense (other than transfer taxes) the new Warrant or
Warrants under this Section 7.

(d)The Company agrees to maintain, at its
aforesaid office, books for the registration and the registration of transfer of
the Warrants.

8.No Rights as Shareholder until Exercise.  This
Warrant does not entitle the holder hereof to any voting rights or other rights
as a shareholder of the Company prior to the exercise hereof.  Upon the
surrender of this Warrant and the payment of the aggregate Exercise Price, the
Warrant Shares so purchased shall be and be deemed to be issued to such holder
as the record owner of such shares as of the close of business on the later of
the date of such surrender or payment. 

9.Loss, Theft, Destruction or Mutilation of
Warrant.  The Company covenants that upon receipt by the Company of evidence
reasonably satisfactory to it of the loss, theft, destruction or mutilation of
this Warrant certificate or any stock certificate relating to the Warrant
Shares, and in case of loss, theft or destruction, of indemnity or security
reasonably satisfactory to it (which shall not include the posting of any bond),
and upon surrender and cancellation of such Warrant or stock certificate, if
mutilated, the Company will make and deliver a new Warrant or stock certificate
of like tenor and dated as of such cancellation, in lieu of such Warrant or
stock certificate.

10.Saturdays, Sundays, Holidays, etc.  If the last
or appointed day for the taking of any action or the expiration of any right
required or granted herein shall be a Saturday, Sunday or a legal holiday, then
such action may be taken or such right may be exercised on the next succeeding
day not a Saturday, Sunday or legal holiday.

11.Adjustments of Exercise Price and Number of Warrant
Shares.  (a) Stock Splits, etc. The number and kind of securities
purchasable upon the exercise of this Warrant and the Exercise Price shall be
subject to adjustment from time to time upon the happening of any of the
following.  In case the Company shall (i) pay a dividend in shares of Common
Stock or make a distribution in shares of Common Stock to holders of its
outstanding Common Stock, (ii) subdivide its outstanding shares of Common Stock
into a greater number of shares of Common Stock, (iii) combine its outstanding
shares of Common Stock into a smaller number of shares of Common Stock or (iv)
issue any shares of its capital stock in a reclassification of the Common Stock,
then the number of Warrant Shares purchasable upon exercise of this Warrant
immediately prior thereto shall be adjusted so that the holder of this Warrant
shall be entitled to receive the kind and number of Warrant Shares or other
securities of the Company which he would have owned or have been entitled to
receive had such Warrant been exercised in advance thereof.  Upon each such
adjustment of the kind and number of Warrant Shares or other securities of the
Company which are purchasable hereunder, the holder of this Warrant shall
thereafter be entitled to purchase the number of Warrant Shares or other
securities resulting from such adjustment at an Exercise Price per Warrant Share
or other security obtained by multiplying the Exercise Price in effect
immediately prior to such adjustment by the number of Warrant Shares purchasable
pursuant hereto immediately prior to such adjustment and dividing by the number
of Warrant Shares or other securities of the Company resulting from such
adjustment.  An adjustment made pursuant to this paragraph shall become
effective immediately after the effective date of such event retroactive to the
record date, if any, for such event.  

(b)Reorganization, Reclassification, Merger,
Consolidation or Disposition of Assets.  In case the Company shall
reorganize its capital, reclassify its capital stock, consolidate or merge with
or into another corporation (where the Company is not the surviving corporation
or where there is a change in or distribution with respect to the Common Stock
of the Company), or sell, transfer or otherwise dispose of all or substantially
all its property, assets or business to another corporation and, pursuant to the
terms of such reorganization, reclassification, merger, consolidation or
disposition of assets, shares of common stock of the successor or acquiring
corporation, or any cash, shares of stock or other securities or property of any
nature whatsoever (including warrants or other subscription or purchase rights)
in addition to or in lieu of common stock of the successor or acquiring
corporation ("Other Property"), are to be received by or distributed
to the holders of Common Stock of the Company, then Holder shall have the right
thereafter to receive, upon exercise of this Warrant, the number of shares of
common stock of the successor or acquiring corporation or of the Company, if it
is the surviving corporation, and Other Property receivable upon or as a result
of such reorganization, reclassification, merger, consolidation or disposition
of assets by a holder of the number of shares of Common Stock for which this
Warrant is exercisable immediately prior to such event.  In case of any such
reorganization, reclassification, merger, consolidation or disposition of
assets, the successor or acquiring corporation (if other than the Company) shall
expressly assume the due and punctual observance and performance of each and
every covenant and condition of this Warrant to be performed and observed by the
Company and all the obligations and liabilities hereunder, subject to such
modifications as may be deemed appropriate (as determined in good faith by
resolution of the Board of Directors of the Company) in order to provide for
adjustments of shares of Common Stock for which this Warrant is exercisable
which shall be as nearly equivalent as practicable to the adjustments provided
for in this Section 11.  For purposes of this Section 11, "common stock of
the successor or acquiring corporation" shall include stock of such
corporation of any class which is not preferred as to dividends or assets over
any other class of stock of such corporation and which is not subject to
redemption and shall also include any evidences of indebtedness, shares of stock
or other securities which are convertible into or exchangeable for any such
stock, either immediately or upon the arrival of a specified date or the
happening of a specified event and any warrants or other rights to subscribe for
or purchase any such stock.  The foregoing provisions of this Section 11 shall
similarly apply to successive reorganizations, reclassifications, mergers,
consolidations or disposition of assets.

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

13.Notice of Adjustment.  Whenever the number of
Warrant Shares or number or kind of securities or other property purchasable
upon the exercise of this Warrant or the Exercise Price is adjusted, as herein
provided, the Company shall promptly mail by registered or certified mail,
return receipt requested, to the holder of this Warrant notice of such
adjustment or adjustments setting forth the number of Warrant Shares (and other
securities or property) purchasable upon the exercise of this Warrant and the
Exercise Price of such Warrant Shares (and other securities or property) after
such adjustment, setting forth a brief statement of the facts requiring such
adjustment and setting forth the computation by which such adjustment was made.
Such notice, in the absence of manifest error, shall be conclusive evidence of
the correctness of such adjustment.

14.Notice of Corporate Action.  If at any
time:

(a)the Company shall take a record of the
holders of its Common Stock for the purpose of entitling them to receive a
dividend or other distribution, or any right to subscribe for or purchase any
evidences of its indebtedness, any shares of stock of any class or any other
securities or property, or to receive any other right, or

(b)there shall be any capital reorganization
of the Company, any reclassification or recapitalization of the capital stock of
the Company or any consolidation or merger of the Company with, or any sale,
transfer or other disposition of all or substantially all the property, assets
or business of the Company to, another corporation or,

(c)there shall be a voluntary or involuntary
dissolution, liquidation or winding up of the Company;

then, in any one or more of such cases, the Company shall
give to Holder (i) at least 30 days' prior written notice of the date on which a
record date shall be selected for such dividend, distribution or right or for
determining rights to vote in respect of any such reorganization,
reclassification, merger, consolidation, sale, transfer, disposition,
liquidation or winding up, and (ii) in the case of any such reorganization,
reclassification, merger, consolidation, sale, transfer, disposition,
dissolution, liquidation or winding up, at least 30 days' prior written notice
of the date when the same shall take place.  Such notice in accordance with the
foregoing clause also shall specify (i) the date on which any such record is to
be taken for the purpose of such dividend, distribution or right, the date on
which the holders of Common Stock shall be entitled to any such dividend,
distribution or right, and the amount and character thereof, and (ii) the date
on which any such reorganization, reclassification, merger, consolidation, sale,
transfer, disposition, dissolution, liquidation or winding up is to take place
and the time, if any such time is to be fixed, as of which the holders of Common
Stock shall be entitled to exchange their shares of Common Stock for securities
or other property deliverable upon such disposition, dissolution, liquidation or
winding up.  Each such written notice shall be sufficiently given if addressed
to Holder at the last address of Holder appearing on the books of the Company
and delivered in accordance with Section 16(d).

15.Authorized Shares.  The Company covenants that
during the period the Warrant is outstanding, it will reserve from its
authorized and unissued Common Stock a sufficient number of shares to provide
for the issuance of the Warrant Shares upon the exercise of any purchase rights
under this Warrant.  The Company further covenants that its issuance of this
Warrant shall constitute full authority to its officers who are charged with the
duty of executing stock certificates to execute and issue the necessary
certificates for the Warrant Shares upon the exercise of the purchase rights
under this Warrant.  The Company will take all such reasonable action as may be
necessary to assure that such Warrant Shares may be issued as provided herein
without violation of any applicable law or regulation, or of any requirements of
the Principal Market upon which the Common Stock may be listed. 

The Company shall not by any action, including,
without limitation, amending its certificate of incorporation or through any
reorganization, transfer of assets, consolidation, merger, dissolution, issue or
sale of securities or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms of this Warrant, but will at all
times in good faith assist in the carrying out of all such terms and in the
taking of all such actions as may be necessary or appropriate to protect the
rights of Holder against impairment.  Without limiting the generality of the
foregoing, the Company will (a) not increase the par value of any shares of
Common Stock receivable upon the exercise of this Warrant above the amount
payable therefor upon such exercise immediately prior to such increase in par
value, (b) take all such action as may be necessary or appropriate in order that
the Company may validly and legally issue fully paid and nonassessable shares of
Common Stock upon the exercise of this Warrant, and (c) use its best efforts to
obtain all such authorizations, exemptions or consents from any public
regulatory body having jurisdiction thereof as may be necessary to enable the
Company to perform its obligations under this Warrant.

Upon the request of Holder, the Company will at
any time during the period this Warrant is outstanding acknowledge in writing,
in form reasonably satisfactory to Holder, the continuing validity of this
Warrant and the obligations of the Company hereunder.

Before taking any action which would cause an
adjustment reducing the current Exercise Price below the then par value, if any,
of the shares of Common Stock issuable upon exercise of the Warrants, the
Company shall take any corporate action which may be necessary in order that the
Company may validly and legally issue fully paid and non-assessable shares of
such Common Stock at such adjusted Exercise Price.

Before taking any action which would result in an
adjustment in the number of shares of Common Stock for which this Warrant is
exercisable or in the Exercise Price, the Company shall obtain all such
authorizations or exemptions thereof, or consents thereto, as may be necessary
from any public regulatory body or bodies having jurisdiction thereof.

16.Miscellaneous.

(a)Jurisdiction. This Warrant shall be binding
upon any successors or assigns of the Company.  This Warrant shall constitute a
contract under the laws of New York  without regard to its conflict of law,
principles or rules, and be subject to arbitration pursuant to the terms set
forth in the Purchase Agreement.

(b)Restrictions.  The holder hereof acknowledges
that the Warrant Shares acquired upon the exercise of this Warrant, if not
registered, will have restrictions upon resale imposed by state and federal
securities laws.

(c)Nonwaiver and Expenses.  No course of dealing
or any delay or failure to exercise any right hereunder on the part of Holder
shall operate as a waiver of such right or otherwise prejudice Holder's rights,
powers or remedies, notwithstanding all rights hereunder terminate on the
Termination Date.  If the Company fails to comply with any  provision of this
Warrant, the Company shall pay to Holder such amounts as shall be sufficient to
cover any costs and expenses including, but not limited to, reasonable
attorneys' fees, including those of appellate proceedings, incurred by Holder in
collecting any amounts due pursuant hereto or in otherwise enforcing any of its
rights, powers or remedies hereunder.

(d)Notices.  Any notice, request or other document
required or permitted to be given or delivered to the holder hereof by the
Company shall be delivered in accordance with the notice provisions of the
Purchase Agreement.

(e)Limitation of Liability.  No provision hereof,
in the absence of affirmative action by Holder to purchase shares of Common
Stock, and no enumeration herein of the rights or privileges of Holder hereof,
shall give rise to any liability of Holder for the purchase price of any Common
Stock or as a stockholder of the Company, whether such liability is asserted by
the Company or by creditors of the Company.

(f)Remedies.  Holder, in addition to being
entitled to exercise all rights granted by law, including recovery of damages,
will be entitled to specific performance of its rights under this Warrant.  The
Company agrees that monetary damages would not be adequate compensation for any
loss incurred by reason of a breach by it of the provisions of this Warrant and
hereby agrees to waive the defense in any action for specific performance that a
remedy at law would be adequate.

(g)Successors and Assigns.  Subject to applicable
securities laws, this Warrant and the rights and obligations evidenced hereby
shall inure to the benefit of and be binding upon the successors of the Company
and the successors and permitted assigns of Holder.  The provisions of this
Warrant are intended to be for the benefit of all Holders from time to time of
this Warrant and shall be enforceable by any such Holder or holder of Warrant
Shares.

(h)Indemnification.  The Company agrees to
indemnify and hold harmless Holder from and against any liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, claims,
costs, attorneys' fees, expenses and disbursements of any kind which may be
imposed upon, incurred by or asserted against Holder in any manner relating to
or arising out of any failure by the Company to perform or observe in any
material respect any of its covenants, agreements, undertakings or obligations
set forth in this Warrant; provided, however, that the Company
will not be liable hereunder to the extent that any liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, claims, costs, attorneys'
fees, expenses or disbursements are found in a final non-appealable judgment by
a court to have resulted from Holder's negligence, bad faith or willful
misconduct in its capacity as a stockholder or warrantholder of the Company.

(i)Amendment.  This Warrant may be modified or
amended or the provisions hereof waived with the written consent of the Company
and the Holder.

(j)Severability.  Wherever possible, each
provision of this Warrant shall be interpreted in such manner as to be effective
and valid under applicable law, but if any provision of this Warrant shall be
prohibited by or invalid under applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provisions or the remaining provisions of
this Warrant.

(k)Headings.  The headings used in this Warrant
are for the convenience of reference only and shall not, for any purpose, be
deemed a part of this Warrant.

IN WITNESS WHEREOF, the Company has caused this Warrant to be
executed by its officer thereunto duly authorized.

Dated: September 15, 2000

Integrated Surgical Systems, Inc.

 

 

By:

Louis Kirchner
Chief Financial Officer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOTICE OF EXERCISE

 

 

To:Integrated Surgical Systems, Inc.

 

	The undersigned hereby elects to purchase ________ shares
of Common Stock (the "Common Stock"), of Integrated Surgical Systems,
Inc. pursuant to the terms of the attached Warrant, and tenders herewith
payment of the exercise price in full, together with all applicable transfer
taxes, if any.

	Please issue a certificate or certificates representing
said shares of Common Stock in the name of the undersigned or in such other name
as is specified below:

_______________________________

(Name)

_______________________________

(Address)

_______________________________

 

 

 

Dated:

 

______________________________

Signature

 

 

 

ASSIGNMENT FORM

(To assign the foregoing warrant, execute

this form and supply required information. 

Do not use this form to exercise the warrant.)

 

 

FOR VALUE RECEIVED, the foregoing Warrant and all rights
evidenced thereby are hereby assigned to

_______________________________________________ whose address
is

_______________________________________________________________.

 

 

_______________________________________________________________<
/P>

Dated:  ______________,
_______

 

Holder's
Signature:_____________________________

Holder's
Address:_____________________________

_____________________________

 

 

Signature Guaranteed:
___________________________________________

 

 

 

NOTE:  The signature to this Assignment Form must correspond
with the name as it appears on the face of the Warrant, without alteration or
enlargement or any change whatsoever, and must be guaranteed by a bank or trust
company.  Officers of corporations and those acting in an fiduciary or other
representative capacity should file proper evidence of authority to assign the
foregoing Warrant.

 

 

 

 

 

 

 

 

 

EXHIBIT E

September 15, 2000

Triton West Group, Inc.

C/o CFS Ltd.

P.O.  Box 613 GT

Georgetown, Grand Cayman

Attention:Ian Goodall

Ladies and Gentlemen:

This opinion is furnished to you pursuant to the Private
Equity Line of Credit Agreement by and between Integrated Surgical Systems,
Inc., a Delaware corporation (the "Company"), and the Triton West Group, Inc.
(the "Investor"), dated as of September 15, 2000 (the "Purchase
Agreement"), which provides for the issuance and sale by the Company of  up to
$12,000,000 of the Company's common stock, par value $.01 per share (the
"Common Stock").  All capitalized terms used but not defined herein
shall have the meanings assigned to them in the Purchase Agreement.

We have acted as counsel to the Company in connection with
the negotiation of the Purchase Agreement,  the Registration Rights Agreement
and the Escrow Agreement, (collectively,  the "Agreements").  As such counsel,
we have made such legal and factual examinations and inquiries as we have deemed
advisable or necessary for the purpose of rendering this opinion.  In addition,
we have examined, among other things, originals or copies of such corporate
records of the Company, certificates of public officials and such other
documents and questions of law that we consider necessary or advisable for the
purpose of rendering this opinion.  In such examination we have assumed the
genuineness of all signatures on original documents, the authenticity and
completeness of all documents submitted to us as originals, the conformity to
original documents of all copies submitted to us as copies thereof, the legal
capacity of natural persons, and the due execution and delivery of all documents
(except as to due execution and delivery by the Company) where due execution and
delivery are a prerequisite to the effectiveness thereof.  As to the matters of
fact, we have relied upon certificates or other written statements of public
authorities and certificates or other written statements of officers and
directors of the Company.  The phrases "to our knowledge" or
"known to us" when used herein mean that with respect to the factual
matter covered thereby, we have undertaken no independent investigation or
verification of such matters, but have relied solely upon the representations
and warranties of the Company contained in the Agreements and have obtained
certificates from the officers and directors of the Company as to such factual
matters, and nothing has come to the attention of those attorneys in our office
who directly participated in this engagement that (x) would give them actual
knowledge or actual notice that such representation or warranty is not accurate
or complete, or (y) any information set forth in any of the foregoing documents,
certificates and information on which they have relied is not accurate or
complete.  In addition, we have assumed that any certificate of a public
authority on which we have relied that was given or dated earlier than the date
of this opinion continues to remain accurate, insofar as relevant to such
opinion, from such earlier date through and including the date of this
opinion.

For purposes of this opinion, we have assumed that the
Investor has all requisite power and authority, and has taken any and all
necessary corporate action, to execute and deliver the Agreements, and we are
assuming that the representations and warranties made by the Investor in the
Agreements and pursuant thereto are true and correct.

Based upon and subject to the foregoing, we are of the
opinion that:

1.The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and has
all requisite corporate power and authority to carry on its business and to own,
lease and operate its properties and assets as described in the Company's SEC
Documents.  To our knowledge, the Company does not have any subsidiaries and
does not own more than fifty percent (50%) of the outstanding capital stock of
or control any other business entity other than as disclosed in the SEC
Documents.  The Company is duly qualified as a foreign corporation to do
business and is in good standing in every jurisdiction in which the Company owns
or leases property, other than those in which the failure so to qualify would
not have a Material Adverse Effect.

2.The Company has the requisite corporate power and
authority to enter into and perform its obligations under the Agreements and to
issue the  Put Shares, the Warrants and the Warrant Shares.  The execution and
delivery of the Agreements by the Company and the consummation by it of the
transactions contemplated thereby have been duly authorized by all necessary
corporate action and no further consent or authorization of the Company or its
Board of Directors or stockholders is required, except as may be required under
the rules of the Nasdaq Stock Market, Inc. (the "Nasdaq Restriction").
Each of the Agreements has been duly executed and delivered and the  Put Shares
and the Warrants *
 have each been duly executed, issued and delivered by the Company and each of
the Agreements and the Warrants *
 constitute  valid and binding obligations of the Company enforceable against
the Company in accordance with their respective terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency, or similar
laws relating to, or affecting generally the enforcement of, creditors' rights
and remedies or by other equitable principles of general application.

3.The execution, delivery and performance of the
Agreements by the Company and the consummation by the Company of the
transactions contemplated thereby, including, without limitation, the issuance
of the Put Shares,  the Warrants *
 and the Warrant Shares *
, do not and will not (i) result in a violation of the Company's Restated
Certificate of Incorporation or By-Laws, each as amended as of the date hereof;
(ii) to our knowledge, conflict with, or constitute a material default (or an
event that with notice or lapse of time or both would become a default) under,
or give to others any rights of termination, amendment, acceleration or
cancellation of, any material agreement, indenture, instrument or any "lock-up"
or similar provision of any underwriting or similar agreement to which the
Company is a party; or (iii) result in a violation of any federal or state law,
rule or regulation applicable to the Company or by which any property or asset
of the Company is bound or affected, except for such violations as would not,
individually or in the aggregate, have a Material Adverse Effect.  To our
knowledge, the Company is not in violation of any terms of its Restated
Certificate of Incorporation or Bylaws, each as amended as of the date
hereof.

4.When so issued, the Put Shares and the Warrant Shares
will be duly and validly issued, fully paid and nonassessable, and free of any
liens, encumbrances and preemptive or similar rights contained in the Company's
Restated Certificate of Incorporation or Bylaws, each as amended as of the date
hereof, or, to our knowledge, in any agreement to which the Company is
party.

5.To our knowledge, there are no claims, actions, suits,
proceedings or investigations that are pending against the Company or its
properties, or against any officer or director of the Company in his or her
capacity as such, nor has the Company received any written threat of any such
claims, actions, suits, proceedings, or investigations which could reasonably be
expected to have a Material Adverse Effect.  To our knowledge, the Company is
not a party to or subject to the provisions of any order, writ, injunction,
judgment or decree of any court or government agency or instrumentality.

*    Only upon signing of Purchase Agreement.

6.To our knowledge, there are no outstanding options,
warrants, calls or commitments of any character whatsoever relating to, or
securities, rights or obligations convertible into or exchangeable for, or
giving any right to subscribe for or acquire any shares of Common Stock or
contracts, commitments, understandings, or arrangements by which the Company is
or may become bound to issue additional shares of Common Stock, or securities or
rights convertible or exchangeable into shares of Common Stock, except as
described in the SEC Documents or the Schedule of Exceptions.

7.Subject to compliance with the Nasdaq Restriction if
and when the same shall apply, the issuance of the  Put Shares and the Warrant
Shares *
 will not violate the applicable listing agreement between the Company and any
securities exchange or market on which the Company's securities are listed or
quoted.

This opinion is limited to the Federal laws of the United
States, the laws of the State of New York and the Delaware General Corporation
Law.  No opinion is expressed with respect to the laws, rules or regulations of
any other jurisdiction, whether U.S. or foreign.

This opinion is furnished to the Investor solely for its
benefit in connection with the transactions described above and may not be
relied upon by any other person or for any other purpose without our prior
written consent.

Very truly yours,

SNOW BECKER KRAUSS P.C.

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