Document:

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                                                                   EXHIBIT 10.32

                                 [CONFIDENTIAL]

                              PUBLIC HEALTH SERVICE

                      PATENT LICENSE AGREEMENT-NONEXCLUSIVE

                                   COVER PAGE

For Office of Technology Transfer/NIH internal use only:
Patent License Number: L-052-98/0

Serial Numbers of Licensed Patents: 60/024,386

Licensee: Introgen Therapeutics, Inc., 301 Congress Avenue, Suite 1850, Austin,
TX 78701

CRADA Number (if applicable): None

Additional Remarks:

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This Patent License Agreement, hereinafter referred to as the "AGREEMENT,"
consists of this Cover Page, an attached agreement, a Signature Page, Appendix A
(Patent or Patent Application), Appendix B (Fields of Use and Territory),
Appendix C (Royalties), and Appendix D (Modifications). This Cover Page serves
to identify the Parties to this AGREEMENT as follows:

1.   The National Institutes of Health ("NIH") or the Centers for Disease
     Control ("CDC"), hereinafter singly or collectively referred to as "PHS,"
     agencies of the United States Public Health Service within the Department
     of Health and Human Services ("DHHS"); and

2.   The person, corporation, or institution identified above and/or on the
     Signature Page, having offices at the address indicated on the Signature
     Page, hereinafter referred to as "LICENSEE."

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                 PHS PATENT LICENSE AGREEMENT-NONEXCLUSIVE

PHS and LICENSEE agree as follows:

1.  BACKGROUND

    1.01   In the course of conducting biomedical and behavioral research, PHS
           investigators made inventions that may have commercial applicability.

    1.02   By assignment of rights from PHS employees and other inventors, DHHS,
           on behalf of the United States Government, owns intellectual property
           rights claimed in any United States and foreign patent applications
           or patents corresponding to the assigned inventions. DHHS also owns
           any tangible embodiments of these inventions actually reduced to
           practice by PHS.

    1.03   The Assistant Secretary for Health of DHHS has delegated to PHS the
           authority to enter into this AGREEMENT for the licensing of the
           rights to these inventions under 35 U.S.C. Sections 200-212, the
           Federal Technology Transfer Act of 1986, 15 U.S.C. Section 3710a,
           and/or the regulations governing the licensing of Government-owned
           inventions, 37 CFR Part 404.

    1.04   PHS desires to transfer these inventions to the private sector
           through commercialization licenses to facilitate the commercial
           development of products and processes for public use and benefit.

    1.05   LICENSEE desires to acquire commercialization rights to certain of
           these inventions in order to develop processes, methods, or
           marketable products for public use and benefit.

2.  DEFINITIONS

    2.01   "LICENSED PATENT RIGHTS" shall mean:

            a)  U.S. patent applications and patents listed in Appendix A, all
                divisions and continuations of these applications, all patents
                issuing from such applications, divisions, and continuations,
                and any reissues, reexaminations, and extensions of all such
                patents;

            b)  to the extent that the following contain one or more claims
                directed to the invention or inventions claimed in a) above: i)
                continuations-in-part of a) above; ii) all divisions and
                continuations of these continuations-in-part; iii) all patents
                issuing from such continuations-in-part, divisions, and
                continuations; and iv) any reissues, reexaminations, and
                extensions of all such patents;

            c)  to the extent that the following contain one or more claims
                directed to the invention or inventions claimed in a) above: all
                counterpart foreign applications and patents to a) and b) above,
                including those listed in Appendix A.

                LICENSED PATENT RIGHTS shall not include b) or c) above to the
                extent that they contain one or more claims directed to new
                matter which is not the subject matter of a claim in a) above.

    2.02   "LICENSED PRODUCT(S)" means tangible materials which, in the
           course of manufacture,

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           use, or sale would, in the absence of this AGREEMENT, infringe one or
           more claims of the LICENSED PATENT RIGHTS that have not been held
           invalid or unenforceable by an unappealed or unappealable judgement
           of a court of competent jurisdiction.

    2.03   "LICENSED PROCESS(ES)" means processes which, in the course of being
           practiced would, in the absence of this AGREEMENT, infringe one or
           more claims of the LICENSED PATENT RIGHTS that have not been held
           invalid or unenforceable by an unappealed or unappealable judgment of
           a court of competent jurisdiction.

    2.04   "LICENSED TERRITORY" means the geographical area identified in
           Appendix B.

    2.05   "NET SALES" means the total gross receipts for sales of LICENSED
           PRODUCTS or practice of Licensed Processes by or on behalf of
           LICENSEE and from leasing, renting, or otherwise making LICENSED
           PRODUCTS available to others without sale or other dispositions,
           whether invoiced or not, less returns and allowances actually
           granted, packing costs, insurance costs, freight out, taxes or excise
           duties imposed on the transaction (if separately invoiced), and
           wholesaler and cash discounts in amounts customary in the trade. No
           deductions shall be made for commissions paid to individuals, whether
           they be with independent sales agencies or regularly employed by
           LICENSEE and on its payroll, or for the cost of collections.

    2.06   "FIRST COMMERCIAL SALE" means the initial transfer by or on behalf of
           LICENSEE of LICENSED PRODUCTS or the initial practice of a LICENSED
           PROCESS in exchange for cash or some equivalent to which value can be
           assigned for the purpose of determining NET SALES.

    2.07   "GOVERNMENT" means the government of the United States of America.

    2.08   "LICENSED FIELDS OF USE" means the fields of use identified in
           Appendix B.

3.  GRANT OF RIGHTS

    3.01   PHS hereby grants and LICENSEE accepts, subject to the terms and
           conditions of this AGREEMENT, a nonexclusive license to LICENSEE
           under the LICENSED PATENT RIGHTS in the LICENSED TERRITORY to make
           and have made, to use and have used, and to sell and have sold any
           LICENSED PRODUCTS in the LICENSED FIELDS OF USE and to practice and
           have practiced any LICENSED PROCESSES in the LICENSED FIELDS OF USE.

    3.02   LICENSEE has no right to grant sublicenses.

    3.03   This AGREEMENT confers no license or rights by implication, estoppel,
           or otherwise under any patent applications or patents of PHS other
           than the LICENSED PATENT RIGHTS regardless of whether such patents
           are dominant or subordinate to LICENSED PATENT RIGHTS.

4.  STATUTORY AND PHS REQUIREMENTS AND RESERVED GOVERNMENT RIGHTS

    4.01   LICENSEE agrees that products used or sold in the United States
           embodying LICENSED PRODUCTS or produced through use of LICENSED
           PROCESSES shall be manufactured substantially in the United States,
           unless a written waiver is obtained in advance from PHS.

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5.  ROYALTIES AND REIMBURSEMENT

    5.01   LICENSEE agrees to pay to PHS a noncreditable, nonrefundable license
           issue royalty as set forth in Appendix C within thirty (30) days from
           the date that this AGREEMENT becomes effective.

    5.02   LICENSEE agrees to pay to PHS a nonrefundable minimum annual royalty
           as set forth in Appendix C. The minimum annual royalty is due and
           payable on January 1 of each calendar year [*]. The minimum annual
           royalty for the first calendar year of this AGREEMENT is due and
           payable within thirty (30) days from the effective date of this
           AGREEMENT and will be prorated according to the fraction of the
           calendar year remaining between the effective date of this AGREEMENT
           and the next subsequent January 1.

    5.03   LICENSEE agrees to pay PHS benchmark royalties as set forth in
           Appendix C.

    5.04   LICENSEE agrees to pay PHS earned royalties as set forth in Appendix
           C.

    5.05   A claim of a patent licensed under this AGREEMENT shall cease to fall
           within the LICENSED PATENT RIGHTS for the purpose of computing the
           minimum annual royalty and earned royalty payments in any given
           country on the earliest of the dates that a) the claim has been
           abandoned but not continued, b) the patent expires, c) the patent is
           no longer maintained by the Government, or d) all claims of the
           LICENSED PATENT RIGHTS have been held to be invalid or unenforceable
           by an unappealed or unappealable decision of a court of competent
           jurisdiction or administrative agency.

    5.06   No multiple royalties shall be payable because any LICENSED PRODUCTS
           or LICENSED PROCESSES are covered by more than one of the LICENSED
           PATENT RIGHTS.

    5.07   On sales of LICENSED PRODUCTS by LICENSEE in other than an
           arm's-length transaction, the value of the NET SALES attributed under
           this Article 5 to such a transaction shall be that which would have
           been received in an arm's-length transaction, based on sales of like
           quantity and quality products on or about the time of such
           transaction.

    5.08   As an additional royalty, LICENSEE agrees to pay PHS within (60) days
           of PHS's submission of a statement and request for payment, an amount
           equivalent to all patent expenses previously incurred by PHS in the
           preparation, filing, prosecution, and maintenance of LICENSED PATENT
           RIGHTS, to be divided equally among all nonexclusive
           commercialization licensees of record as of the date the statement
           and request for payment is sent by PHS to LICENSEE. LICENSEE further
           agrees to pay PHS annually, within sixty (60) days of PHS's
           submission of a statement and request for payment, a royalty amount
           equivalent to all such future patent expenses incurred during the
           previous calendar year divided equally among all nonexclusive
           commercialization licensees of record as of the date the statement
           and request for payment are sent by PHS to LICENSEE. [*] of the
           cumulative amount of the payments due under this Paragraph 5.07 may
           be credited against royalties due under Paragraph 5.03; however, the
           net royalty payment in any calendar year may not be lower than the
           minimum annual royalty specified in Appendix C. LICENSEE may elect to
           surrender its rights in any country of the LICENSED TERRITORY under
           any LICENSED PATENT RIGHTS upon sixty (60) days' written notice to
           PHS and owe no payment obligation under this Paragraph for subsequent
           patent-related expenses incurred in that country.

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                separately with the Commission. Confidential treatment has been
                requested with respect to the omitted portions.

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6.  RECORD KEEPING

    6.01   LICENSEE agrees to keep accurate and correct records of LICENSED
           PRODUCTS made, used, or sold and LICENSED PROCESSES practiced under
           this AGREEMENT appropriate to determine the amount of royalties due
           PHS. Such records shall be retained for at least five (5) years
           following a given reporting period. They shall be available during
           normal business hours for inspection at the expense of PHS by an
           accountant or other designated auditor selected by PHS for the sole
           purpose of verifying reports and payments hereunder. The accountant
           or auditor shall only disclose to PHS information relating to the
           accuracy of reports and payments made under this AGREEMENT. If an
           inspection shows an underreporting or underpayment in excess of five
           percent (5%) for any twelve (12) month period, then LICENSEE shall
           reimburse PHS for the cost of the inspection at the time LICENSEE
           pays the unreported royalties, including any late charges as required
           by Paragraph 7.06 of this AGREEMENT. All payments required under this
           Paragraph shall be due within thirty (30) days of the date PHS
           provides LICENSEE notice of the payment due.

7.  REPORTS ON PROGRESS, SALES, AND PAYMENTS

    7.01   Prior to signing this AGREEMENT, LICENSEE has provided to PHS a
           written commercialization plan ("COMMERCIAL DEVELOPMENT PLAN") under
           which LICENSEE intends to bring the subject matter of the LICENSED
           PATENT RIGHTS into commercial use. The COMMERCIAL DEVELOPMENT PLAN is
           hereby incorporated by reference into this AGREEMENT.

    7.02   LICENSEE shall provide written annual reports on its product
           development progress or efforts to commercialize under the COMMERCIAL
           DEVELOPMENT PLAN for each of the LICENSED FIELDS OF USE within sixty
           (60) days after December 31 of each calendar year. These progress
           reports shall include, but not be limited to: progress on research
           and development, status of applications for regulatory approvals,
           manufacturing, marketing, and sales during the preceding calendar
           year, as well as plans for the present calendar year. LICENSEE agrees
           to provide any additional data reasonably required by PHS to evaluate
           LICENSEE's performance.

    7.03   LICENSEE shall report to PHS the date of the FIRST COMMERCIAL SALE in
           each country in the LICENSED TERRITORY within thirty (30) days of
           such occurrence.

    7.04   LICENSEE shall submit to PHS within sixty (60) days after each
           calendar half-year ending June 30 and December 31 a royalty report
           setting forth for the preceding half-year period the amount of the
           LICENSED PRODUCTS sold or LICENSED PROCESSES practiced by or on
           behalf of LICENSEE in each country within the LICENSED TERRITORY, the
           NET SALES, and the amount of royalty accordingly due. With each such
           royalty report, LICENSEE shall submit payment of the earned royalties
           due. If no earned royalties are due to PHS for any reporting period,
           the written report shall so state. The royalty report shall be
           certified as correct by an authorized officer of LICENSEE and shall
           include a detailed listing of all deductions made under Paragraph
           2.05 to determine NET SALES made under Article 5 to determine
           royalties due.

    7.05   Royalties due under Article 5 shall be paid in U.S. dollars. For
           conversion of foreign currency to U.S. dollars, the conversion rate
           shall be the rate quoted in The Wall Street Journal on the day that
           the payment is due. All checks and bank drafts shall be drawn on
           United States banks and shall be payable to NIH/Patent Licensing at
           the address shown

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           on the Signature Page below. Any loss of exchange, value, taxes, or
           other expenses incurred in the transfer or conversion to U.S. dollars
           shall be paid entirely by LICENSEE. All royalty payments due under
           this AGREEMENT shall be mailed to the following address: NIH
           P.O. Box 360120, Pittsburgh, Pennsylvania 15251-6120. The royalty
           report required by paragraph 7.04 of this AGREEMENT shall accompany
           each such payment and a copy of such report shall also be mailed to
           PHS at its address for notices indicated on the Signature Page of
           this AGREEMENT.

    7.06   Late charges will be applied to any overdue payments as required by
           the U.S. Department of Treasury in the Treasury Fiscal Requirements
           Manual, Section 8025.40. The payment of such late charges shall not
           prevent PHS from exercising any other rights it may have as a
           consequence of the lateness of any payment.

    7.07   All plans and reports required by this Article 7 and marked
           "confidential" by LICENSEE shall be treated by PHS as commercial and
           financial information obtained from a person, and as privileged and
           confidential and, to the extent permitted by law, shall not be
           subject to disclosure under the Freedom of Information Act, 5 U.S.C.
           Section 552.

8.  PERFORMANCE

    8.01   LICENSEE shall use its reasonable best efforts to introduce the
           LICENSED PRODUCTS into the commercial market or apply the LICENSED
           PROCESSES to commercial use as soon as practicable. "Reasonable best
           efforts" for the purpose of this provision shall include, but not be
           limited to, adherence to the COMMERCIAL DEVELOPMENT PLAN.

    8.02   Upon the FIRST COMMERCIAL SALE, until the expiration of this
           AGREEMENT, LICENSEE shall use its reasonable best efforts to keep
           LICENSED PRODUCTS and LICENSED PROCESSES reasonably accessible to the
           public.

9.  INFRINGEMENT AND PATENT ENFORCEMENT

    9.01   PHS and LICENSEE agree to notify each other promptly of each
           infringement or possible infringement, as well as any facts which may
           affect the validity, scope, or enforceability of the LICENSED PATENT
           RIGHTS of which either Party becomes aware.

    9.02   If PHS has been unable to eliminate a substantial infringement within
           one (1) year of written notification to the Office of Technology
           Transfer from LICENSEE of the existence of a substantial infringement
           and has not instituted infringement litigation, LICENSEE shall be
           excused from [*]. Thereafter, when the substantial infringement has
           ceased or an infringement suit has been initiated, PHS shall so
           notify the LICENSEE in writing, at which time [*] shall resume as
           of the date of such notification.

    9.03   In the event that a declaratory judgment action alleging invalidity
           of any of the LICENSED PATENT RIGHTS shall be brought against PHS,
           PHS agrees to notify LICENSEE that an action alleging invalidity has
           been brought. PHS does not represent that it will commence legal
           action to defend against a declaratory action alleging invalidity.
           LICENSEE shall take no action to compel the GOVERNMENT either to
           initiate or to join in any such declaratory judgment action. Should
           the GOVERNMENT be made a party to any such suit by motion or

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                separately with the Commission. Confidential treatment has been
                requested with respect to the omitted portions.

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           any other action of LICENSEE, LICENSEE shall reimburse the GOVERNMENT
           for any costs, expenses, or fees which the GOVERNMENT incurs as a
           result of its defending against such motion or other action taken in
           response to the motion. Upon LICENSEE's payment of all costs incurred
           by the GOVERNMENT as a result of LICENSEE's joinder motion or other
           action, these actions by LICENSEE will not be considered a default in
           the performance of any material obligation under this AGREEMENT.

10. NEGATION OF WARRANTIES AND INDEMNIFICATION

    10.01  PHS offers no warranties other than those specified in Article 1.

    10.02  PHS does not warrant the validity of the LICENSED PATENT RIGHTS and
           makes no representations whatsoever with regard to the scope of the
           LICENSED PATENT RIGHTS, or that the LICENSED PATENT RIGHTS may be
           exploited without infringing other patents or other intellectual
           property rights of third parties.

    10.03  PHS MAKES NO WARRANTIES, EXPRESSED OR IMPLIED, OF MERCHANTABILITY OR
           FITNESS FOR A PARTICULAR PURPOSE OF ANY SUBJECT MATTER DEFINED BY THE
           CLAIMS OF THE LICENSED PATENT RIGHTS.

    10.04  PHS does not represent that it will commence legal actions against
           third parties infringing the LICENSED PATENT RIGHTS.

    10.05  LICENSEE shall indemnify and hold PHS, its employees, students,
           fellows, agents, and consultants harmless from and against all
           liability, demands, damages, expenses, and losses, including but not
           limited to death, personal injury, illness, or property damage in
           connection with or arising out of a) the use by or on behalf of
           LICENSEE, ALSO sublicensees or its directors, employees, or third
           parties of any LICENSED PATENT RIGHTS, or b) the design, manufacture,
           distribution, or use of any LICENSED PRODUCTS, LICENSED PROCESSES, or
           other products or processes developed in connection with or arising
           out of the LICENSED PATENT RIGHTS. LICENSEE agrees to maintain a
           liability insurance program consistent with sound business practice.

11. TERMINATION AND MODIFICATION OF RIGHTS

    11.01  This AGREEMENT is effective when signed by all parties and shall
           extend to the expiration of the last to expire of the LICENSED PATENT
           RIGHTS unless sooner terminated as provided in this Article 11.

    11.02  In the event that LICENSEE is in default in the performance of any
           material obligations under this AGREEMENT, and if the default has not
           been remedied within ninety (90) days after the date of notice in
           writing of such default, PHS may terminate this AGREEMENT by written
           notice.

    11.03  At least thirty (30) days prior to filing a petition in bankruptcy,
           LICENSEE must inform PHS in writing of its intention to file the
           petition in bankruptcy or of a third party's intention to file an
           involuntary petition in bankruptcy.

    11.04  In the event that LICENSEE becomes insolvent, files a petition in
           bankruptcy, has such a petition filed against it, determines to file
           a petition in bankruptcy, or receives notice of a

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           third party's intention to file an involuntary petition in
           bankruptcy, LICENSEE shall immediately notify PHS in writing.
           Furthermore, PHS shall have the right to terminate this AGREEMENT by
           giving LICENSEE written notice. Termination of this AGREEMENT is
           effective upon LICENSEE's receipt of the written notice.

    11.05  LICENSEE shall have a unilateral right to terminate this AGREEMENT
           and/or its rights in any country by giving PHS sixty (60) days'
           written notice to that effect.

    11.06  PHS shall specifically have the right to terminate or modify, at its
           option, this AGREEMENT, if PHS determines that the LICENSEE: 1) is
           not executing the COMMERCIAL DEVELOPMENT PLAN submitted with its
           request for a license and the LICENSEE cannot otherwise demonstrate
           to PHS's satisfaction that the LICENSEE has taken, or can be expected
           to take within a reasonable time, effective steps to achieve
           practical application of the LICENSED PRODUCTS or LICENSED PROCESSES;
           2) has willfully made a false statement of, or willfully omitted, a
           material fact in the license application or in any report required by
           the license agreement; 3) has committed a substantial breach of a
           covenant or agreement contained in the license; 4) is not keeping
           LICENSED PRODUCTS or LICENSED PROCESSES reasonably available to the
           public after commercial use commences; 5) cannot reasonably satisfy
           unmet health and safety needs; or 6) cannot reasonably justify a
           failure to comply with the domestic production requirement of
           Paragraph 4.01 unless waived. In making this determination, PHS will
           take into account the normal course of such commercial development
           programs conducted with sound and reasonable business practices and
           judgment and the annual reports submitted by LICENSEE under Paragraph
           7.02. Prior to invoking this right, PHS shall give written notice to
           LICENSEE providing LICENSEE specific notice of, and a ninety (90) day
           opportunity to respond to, PHS's concerns as to the previous items 1)
           to 6). If LICENSEE fails to alleviate PHS's concerns as to the
           previous items 1) to 6) or fails to initiate corrective action to
           PHS's satisfaction, PHS may terminate this AGREEMENT.

    11.07  PHS reserves the right according to 35 U.S.C. Section 209(f)(4) to
           terminate or modify this AGREEMENT if it is determined that such
           action is necessary to meet requirements for public use specified by
           Federal regulations issued after the date of the license and such
           requirements are not reasonably satisfied by LICENSEE.

    11.08  Within thirty (30) days of receipt of written notice of PHS's
           unilateral decision to terminate this AGREEMENT, LICENSEE may,
           consistent with the provisions of 37 CFR Section 404.11, appeal the
           decision by written submission to the Director of NIH or designee.
           The decision of the NIH Director or designee shall be the final
           agency decision. LICENSEE may thereafter exercise any and all
           administrative or judicial remedies that may be available.

    11.09  Within ninety (90) days of termination of this AGREEMENT under this
           Article 11 or expiration under Paragraph 11.01, a final report shall
           be submitted by LICENSEE. Any royalty payments and unreimbursed
           patent expenses due to PHS become immediately due and payable upon
           termination or expiration of this AGREEMENT, and LICENSEE shall
           return all LICENSED PRODUCTS or other materials included within the
           LICENSED PATENT RIGHTS to PHS or provide PHS with certification of
           their destruction.

    11.10  Paragraphs 6.01, 7.05-7.07, 10.01, 10.03, 10.05, and 11.08 of this
           AGREEMENT shall survive termination of this AGREEMENT.

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12. GENERAL PROVISIONS

    12.01  Neither Party may waive or release any of its rights or interests in
           this AGREEMENT except in writing. The failure of the GOVERNMENT to
           assert a right hereunder or to insist upon compliance with any term
           or condition of this AGREEMENT shall not constitute a waiver of that
           right by the GOVERNMENT or excuse a similar subsequent failure to
           perform any such term or condition by LICENSEE.

    12.02  This AGREEMENT constitutes the entire agreement between the Parties
           relating to the subject matter of the LICENSED PATENT RIGHTS, and all
           prior negotiations, representations, agreements, and understandings
           are merged into, extinguished by, and completely expressed by this
           AGREEMENT.

    12.03  The provisions of this AGREEMENT are severable, and in the event that
           any provision of this AGREEMENT shall be determined to be invalid or
           unenforceable under any controlling body of law, such determination
           shall not in any way affect the validity or enforceability of the
           remaining provisions of this AGREEMENT.

    12.04  If either Party desires a modification to this AGREEMENT, the Parties
           shall, upon reasonable notice of the proposed modification by the
           Party desiring the change, confer in good faith to determine the
           desirability of such modification. No modification will be effective
           until a written amendment is signed by the signatories to this
           AGREEMENT or their designees.

    12.05  The construction, validity, performance, and effect of this AGREEMENT
           shall be governed by Federal law as applied by the Federal courts in
           the District of Columbia.

    12.06  All notices required or permitted by this AGREEMENT shall be given by
           prepaid, first class, registered or certified mail properly addressed
           to the other Party at the address designated on the following
           Signature Page, or to such other address as may be designated in
           writing by such other Party, and shall be effective as of the date of
           the postmark of such notice.

    12.07  This AGREEMENT shall not be assigned by LICENSEE except a) with the
           prior written consent of PHS; or b) as part of a sale or transfer of
           substantially the entire business of LICENSEE relating to operations
           which concern this AGREEMENT. LICENSEE shall notify PHS within ten
           (10) days of any assignment of this AGREEMENT by LICENSEE.

    12.08  LICENSEE agrees in its use of any PHS-supplied materials to comply
           with all applicable statutes, regulations, and guidelines, including
           Public Health Service and National Institutes of Health regulations
           and guidelines. LICENSEE agrees not to use the materials for research
           involving human subjects or clinical trials in the United States
           without complying with 21 CFR Part 50 and 45 CFR Part 46. LICENSEE
           agrees not to use the materials for research involving human subjects
           or clinical trials outside of the United States without notifying
           PHS, in writing, of such research or trials and complying with the
           applicable regulations of the appropriate national control
           authorities. Written notification to PHS of research involving human
           subjects or clinical trials outside of the United States shall be
           given no later than sixty (60) days prior to commencement of such
           research or trials.

    12.09  LICENSEE acknowledges that it is subject to and agrees to abide by
           the United States laws and regulations (including the Export
           Administration Act of 1979 and Arms Export Control Act) controlling
           the export of technical data, computer software, laboratory

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           prototypes, biological material, and other commodities. The transfer
           of such items may require a license from the cognizant agency of the
           U.S. GOVERNMENT or written assurances by LICENSEE that it shall not
           export such items to certain foreign countries without prior approval
           of such agency. PHS neither represents that a license is or is not
           required or that, if required, it shall be issued.

    12.10  LICENSEE agrees to mark the LICENSED PRODUCTS or their packaging sold
           in the United States with all applicable U.S. patent numbers and
           similarly to indicate "Patent Pending" status. All LICENSED PRODUCTS
           manufactured in, shipped to, or sold in other countries shall be
           marked in such a manner as to preserve PHS patent rights in such
           countries.

    12.11  By entering into this AGREEMENT, PHS does not directly or indirectly
           endorse any product or service provided, or to be provided, by
           LICENSEE whether directly or indirectly related to this AGREEMENT.
           LICENSEE shall not state or imply that this AGREEMENT is an
           endorsement by the GOVERNMENT, PHS any other GOVERNMENT
           organizational unit, or any GOVERNMENT employee. Additionally,
           LICENSEE shall not use the names of PHS, NIH, or CDC or their
           employees in any advertising, promotional, or sales literature
           without the prior written consent of PHS.

    12.12  The Parties agree to attempt to settle amicably any controversy or
           claim arising under this AGREEMENT or a breach of this AGREEMENT,
           except for appeals of modification or termination decisions provided
           for in Article 11. LICENSEE agrees first to appeal any such unsettled
           claims or controversies to the Director of NIH, or designee, whose
           decision shall be considered the final agency decision. Thereafter,
           LICENSEE may exercise any administrative or judicial remedies that
           may be available.

    12.13  Nothing relating to the grant of a license, nor the grant itself,
           shall be construed to confer upon any person any immunity from or
           defenses under the antitrust laws or from a charge of patent misuse,
           and the acquisition and use of rights pursuant to 37 CFR Part 404
           shall not be immunized from the operation of state or Federal law by
           reason of the source of the grant.

                          SIGNATURES BEGIN ON NEXT PAGE

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<PAGE>   11

                    PHS PATENT LICENSE AGREEMENT-NONEXCLUSIVE

                                 SIGNATURE PAGE

FOR PHS

by:     /s/ JACK SPIEGEL                                8/17/98
    ------------------------------------            ------------------
Jack Spiegel, Ph.D.                           Date
Director, Division of Technology Development and Transfer
National Institutes of Health

Mailing Address for Notices:

Office of Technology Transfer
National Institutes of Health
6011 Executive Boulevard, Suite 325
Rockville, Maryland 20852

FOR LICENSEE (Upon information and belief, the undersigned expressly certifies
or affirms that the contents of any statements of LICENSEE made or referred to
in this document are truthful and accurate.):

INTROGEN THERAPEUTICS, INC.
----------------------------------------
LICENSEE

by: /s/ MAHENDRA G. SHAH                                7/27/98
   -------------------------------------            ------------------
Signature of Authorized Official              Date

MAHENDRA G. SHAH
----------------------------------------
Printed Name

V.P.
----------------------------------------
Title

Mailing Address for Notices:

301 Congress Avenue
----------------------------------------

Suite - 1850
----------------------------------------

Austin, Texas 78701
----------------------------------------

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<PAGE>   12

                     APPENDIX A-PATENT OR PATENT APPLICATION

PATENT OR PATENT APPLICATION:

U.S. Patent Application No. [*] entitled [*]

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                separately with the Commission. Confidential treatment has been
                requested with respect to the omitted portions.
<PAGE>   13

                 APPENDIX B-LICENSED FIELDS OF USE AND TERRITORY

LICENSED TERRITORY:

Worldwide

LICENSED FIELDS OF USE:

[*]

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<PAGE>   14

                              APPENDIX C-ROYALTIES

ROYALTIES:

LICENSEE agrees to pay to PHS a noncreditable, nonrefundable license issue
royalty in the amount of [*].

LICENSEE agrees to pay to PHS a nonrefundable minimum annual royalty in the
amount of [*].

LICENSEE agrees to pay PHS earned royalties on NET SALES:

[*] on NET SALES of LICENSED PRODUCTS in LICENSED TERRITORY.

LICENSEE agrees to pay PHS Benchmark Royalties for each LICENSED PRODUCT as
follows:

[*] for a LICENSED PRODUCT: [*]

Initiation of the first [*] Clinical Trials for a LICENSED PRODUCT:
[*]

Initiation of the first [*] Clinical Trials for a LICENSED PRODUCT:
[*]

Initiation of the first [*] Clinical Trials for a LICENSED PRODUCT:
[*]

Approval of the first [*] for a LICENSED PRODUCT:
[*]

The benchmark royalty amounts shall be reduced by [*] with respect to [*] to
meet such milestone. [*] For purposes of the foregoing benchmark payments,
a LICENSED PRODUCT shall be deemed to include all LICENSED PRODUCTS (as
defined in Paragraph 2.02) which incorporate the same gene.

LICENSEE agrees to pay PHS benchmark royalties for EACH SUBLICENSED PRODUCT as
follows:

In the event that LICENSEE grants a SUBLICENSE, which includes intellectual
property other than LICENSED PATENT RIGHTS, LICENSEE shall pay the following
percentage of SUBLICENSING payments based on the phase of development of all
LICENSED PRODUCTS:

[*] of the total SUBLICENSING FEE prior to [*].

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<PAGE>   15
[*] of the total SUBLICENSING FEE in the event the LICENSEE has initiated at
least one [*] study with respect to any LICENSED PRODUCT subject to the
SUBLICENSE arrangement.

[*] of the total SUBLICENSING FEE in the event the LICENSEE has initiated at
least one [*] study with respect to any LICENSED PRODUCT subject to the
SUBLICENSE arrangement.

[*] of the total SUBLICENSING FEE in the event the LICENSEE has initiated at
least one [*] study with respect to any LICENSED PRODUCT subject to the
SUBLICENSE arrangement.

For purposes of the foregoing payments, "SUBLICENSING FEE" shall mean all
up-front cash payments received by LICENSEE from a SUBLICENSEE for rights to the
LICENSED PATENTS, but excluding (i) amounts received in reimbursement for
research or development related to the LICENSED PATENTS, (ii) amounts received
as payment for marketing services, equity, or goods or products, and (iii)
amounts received in consideration for the sale of all or substantially all of
the business or assets of LICENSEE relating to this Agreement.

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                requested with respect to the omitted portions.
<PAGE>   16

                            APPENDIX D-MODIFICATIONS

PHS and LICENSEE agree to the following modifications to the Articles and
Paragraphs of this AGREEMENT:

2.05 "NET SALES" means the total gross receipts for sales of LICENSED PRODUCTS
or practice of LICENSED PROCESSES by or on behalf of LICENSEE or its
Sublicensees and from leasing, renting, or otherwise making LICENSED PRODUCTS
available to others without sale or other dispositions, whether invoiced or not,
less returns and allowances actually granted, packing costs, insurance costs,
freight out, taxes or excise duties imposed on the transaction (if separately
invoiced), and wholesaler and cash discounts in amounts customary in the trade.
No deductions shall be made for commissions paid to individuals, whether they be
with independent sales agencies or regularly employed by LICENSEE or its
Sublicensees and on its payroll, or for the cost of collections.

2.09 "Sublicensee" means any non-affiliate third party to whom LICENSEE has
granted the right to make and sell a LICENSED PRODUCT and/or practice a LICENSED
PROCESS, with respect to the LICENSED PRODUCTS made and sold or the LICENSED
PROCESSES practiced by such third party.

3.02 Upon written approval by PHS, which approval will not be unreasonably
withheld or delayed, Licensee has the right to grant sublicenses to the LICENSED
PATENT Rights to third parties. LICENSEE shall forward a copy of the executed
sublicense agreement within (60) days of its execution.

3.04 LICENSEE agrees that any sublicenses granted by it hereunder shall provide
that the obligations to PHS of Paragraphs 4.01, 6.01, 7.01, 7.03, 8.01, 8.02,
9.01, 9.02, 9.03, 10.05, and 11.06-11.08 of this Agreement shall be binding upon
the Sublicensee as if it were a party to this Agreement. LICENSEE further agrees
to attach copies of these Paragraphs to all such sublicense agreements.

3.05 Any sublicenses granted by LICENSEE shall provide for the termination of
the sublicense or the conversion to a license directly between such Sublicensees
and PHS on the applicable terms and conditions herein, at the option of the
Sublicensee, upon termination of this Agreement under Article 11. Such
conversion is subject and contingent upon acceptance by the Sublicensee of the
applicable provisions of this Agreement.

5.08 As an additional royalty, LICENSEE agrees to pay PHS within (60) days of
PHS's submission of a statement and request for payment, an amount equivalent to
all patent expenses previously incurred by PHS in the preparation, filing,
prosecution, and maintenance of LICENSED PATENT RIGHTS, to be divided equally
among all nonexclusive commercialization LICENSEES of record as of the date the
statement and request for payment is sent by PHS to LICENSEE. LICENSEE further
agrees to pay PHS annually, within sixty (60) days of PHS's submission of a
statement and request for payment, a royalty amount equivalent to all such
future patent expenses incurred during the previous calendar year divided
equally among all nonexclusive commercialization LICENSEES of record as of the
date the statement and request for payment are sent by PHS to LICENSEE. [*] of
the cumulative amount of the payments due under this Paragraph 5.08 may be
credited against royalties due under Paragraph 5.03; however, the net royalty
payment in any calendar year may not be lower than the minimum annual royalty
specified in Appendix C. LICENSEE may elect to surrender its rights in any
country of the LICENSED TERRITORY under any LICENSED PATENT RIGHTS upon sixty
(60) days' written notice to PHS and owe [*] under this Paragraph for subsequent
patent-related expenses incurred in that country.

5.09 LICENSEE agrees to pay PHS the sublicensing royalties as set forth in
Appendix C.

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                requested with respect to the omitted portions.
<PAGE>   17

10.05 LICENSEE shall indemnify and hold PHS, its employees, students, fellows,
agents, and consultants harmless from and against all liability, demands,
damages, expenses, and losses, including but not limited to death, personal
injury, illness, or property damage in connection with or arising out of a) the
use by or on behalf of LICENSEE its Sublicensees and their officers, directors,
employees, or third parties acting on their behalf of any LICENSED PATENT
RIGHTS, or b) the design, manufacture, distribution, or use of any LICENSED
PRODUCTS, LICENSED PROCESSES, or other products or processes developed in
connection with or arising out of the LICENSED PATENT RIGHTS hereunder; provided
that any party seeking indemnification under this Paragraph 10.5 shall: (i)
promptly notify LICENSEE in writing of any claim, suit or other proceeding with
respect to which the party intends to claim such indemnification: (ii) provide
LICENSEE the opportunity as is afforded by applicable laws, rules or regulations
to jointly control the defense and/or settlement of such claim suit or
proceeding: (iii) provide LICENSEE, at LICENSEE's request and expense, with
reasonable assistance and full information with respect to such claim, suit or
proceeding. LICENSEE agrees to maintain a liability insurance program consistent
with sound business practice.

11.03 [Delete]

11.04 PHS may terminate this Agreement on written notice to LICENSEE, if the
LICENSEE becomes the subject of a voluntary: Petition in bankruptcy, or any
proceeding relating to insolvency, receivership, liquidation, or composition for
the benefit of creditors, if that petition or proceeding is not dismissed with
prejudice within sixty (60) days after filing. Without limiting the foregoing,
LICENSEE shall promptly notify PHS upon the filing of any of the foregoing
petitions or proceedings.

12.07 This Agreement shall not be assigned by LICENSEE except a) with the prior
written consent of PHS, or b) as part of a sale or transfer of substantially the
entire business of LICENSEE relating to operations which concern this Agreement
or to a party that is an affiliate or subsidiary of LICENSEE at the time of the
assignment. LICENSEE shall notify PHS within ten (10) days of any assignment of
this Agreement by LICENSEE.

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                                                                     EXHIBIT 4.2

            AMENDED AND RESTATED STOCKHOLDERS AND RIGHTS AGREEMENT

                                 By and Among

                            Click Interactive, Inc.

                      The Stockholders, as defined herein

                                      and

                       The Investors, as defined herein

                           Dated as of July 9, 1999
<PAGE>

                               TABLE OF CONTENTS

<TABLE>
<S>                                                                                     <C>
ARTICLE I    DEFINITIONS..............................................................   2

     Section 1.1     Construction of Terms............................................   2
     Section 1.2     Number of Shares of Stock........................................   2
     Section 1.3     Defined Terms....................................................   2

ARTICLE II   RESTRICTIONS ON TRANSFER: RIGHTS OF ErRST REFUSAL; CO-SALE RIGHTS........   4

     Section 2.1     Restrictions on Transfer.........................................   4
     Section 2.2     Right of First Refusal...........................................   5
     Section 2.3     Co-Sale Option...................................................   7
     Section 2.4     Change in Control................................................   8
     Section 2.5     Sales to Competitors.............................................   9
     Section 2.6     Prohibited Transfers.............................................   9

ARTICLE III  RIGHTS TO PURCHASE.......................................................   9

     Section 3.1     Right to Participate in Certain Sales of Additional Securities...   9
     Section 3.2     Assignment of Rights.............................................  10

ARTICLE IV   REGISTRATION RIGHTS......................................................  10

     Section 4.1     Optional Registrations...........................................  10
     Section 4.2     Required Registrations...........................................  11
     Section 4.3     Further Obligations of the Company...............................  13
     Section 4.4     Indemnification; Contribution....................................  15
     Section 4.5     Rule 144 and Rule 144A Requirements..............................  17
     Section 4.6     Transferability of Registration Rights...........................  17
     Section 4.7     Rights Which May Be Granted to Subsequent Investors..............  17

ARTICLE V    MARKET STAND-OFF AGREEMENT...............................................  18

ARTICLE VI   ELECTION OF DIRECTORS; ACTIONS REQUIRING BOARD APPROVAL..................  18

     Section 6.1     Board Composition................................................  18
     Section 6.2     Committees of the Board..........................................  19
     Section 6.3     Actions Requiring Board Approval.................................  19
     Section 6.4     Assignment.......................................................  21

ARTICLE VII  GENERAL..................................................................  21

     Section 7.1     Amendments, Waivers and Consents.................................  21
     Section 7.2     Legend on Securities.............................................  22
</TABLE>

                                       i
<PAGE>

<TABLE>
     <S>                                                                                <C>
     Section 7.3     Governing Law....................................................  22
     Section 7.4     Section Headings.................................................  22
     Section 7.5     Counterparts.....................................................  23
     Section 7.6     Notices and Demands..............................................  23
     Section 7.7     Dispute Resolution...............................................  23
     Section 7.8     Remedies; Severability...........................................  24
     Section 7.9     Integration......................................................  25
     Section 7.10    Adjustment.......................................................  25
     Section 7.11    Term.............................................................  25
</TABLE>

EXHIBITS

Exhibit A - Form of Stockholder Joinder Agreement
Exhibit B - Form of Investor Joinder Agreement

                                      ii
<PAGE>

             AMENDED AND RESTATED STOCKHOLDERS AND RIGHTS AGREEMENT
             ------------------------------------------------------

     THIS AMENDED AND RESTATED STOCKHOLDERS AND RIGHTS AGREEMENT is made as of
this 9th day of July, 1999 by and among Click Interactive, Inc., a Delaware
corporation (together with any successor thereto, the "Company"), Michael W.
Ferro, Jr. (the "Founder"), Robert K. Markese (the "Management Stockholder"),
the investors identified on the signature pages hereto as the Series A Investors
(each, a "Series A Investor" and, collectively, the "Series A Investors"), the
investor identified on the signature pages hereto as the Series B Investor (the
"Series B Investor" and, together with the Series A Investors, the "Investors"),
for purposes of Article IV hereof, Robert K. Markese and any other stockholder,
warrantholder or optionholder who from time to time becomes a party to this
Agreement by execution of a Joinder Agreement in substantially the form attached
hereto as Exhibit A (collectively, the "Additional Stockholders").  The Founder
          ----------
and the Additional Stockholders are herein referred to collectively as the
"Stockholders" and individually as a "Stockholder."

     WHEREAS, the Founder holds shares of the Company's Common Stock (as defined
herein);

     WHEREAS, the Company and the Series A Investors have entered into a Stock
Purchase Agreement, dated as of June 17, 1999 (the "Series A Purchase
Agreement"), pursuant to which, among other things, the Series A Investors have
purchased, and have agreed to purchase additional shares of the Company's Series
A Convertible Participating Preferred Stock, $.001 par value per share (the
"Series A Preferred Stock") and a Stockholders and Rights Agreement dated as of
June 17, 1999 (the "Prior Stockholders Agreement");

     WHEREAS, the Company and the Series B Investor has entered into a Stock
Purchase Agreement, dated as of the date hereof (the "Series B Purchase
Agreement"), pursuant to which, among other things, the Series B Investor has
agreed to purchase shares of the Company's Series B Convertible Participating
Preferred Stock, $.001 par value per share (the "Series B Preferred Stock" and,
together with the Series A Preferred Stock, the "Preferred Stock");

     WHEREAS, the execution and delivery of this Agreement, which is intended to
amend and restate the Prior Stockholders Agreement, is a condition precedent to
the transactions contemplated by the Series B Purchase Agreement; and

     WHEREAS, the Company desires to grant to the Series A Investors, the Series
B Investor, the Founder and the Management Stockholder the rights contained
herein, and the parties hereto desire to agree upon the terms upon which the
outstanding securities of the Company, now or hereafter outstanding and held by
them, will be held, transferred and voted, in order to fulfill such condition.

     NOW THEREFORE, in consideration of the foregoing and the mutual covenants
and agreements hereinafter set forth, the parties hereto agree as follows:
<PAGE>

ARTICLE I  DEFINITIONS
---------  -----------

     Section 1.1 Construction of Terms.  As used herein, the masculine, feminine
     ----------- ---------------------
or neuter gender, and the singular or plural number, shall be deemed to be or to
include the other genders or number, as the case may be, whenever the context so
indicates or requires.

     Section 1.2 Number of Shares of Stock. Whenever any provision of this
     ----------- -------------------------
Agreement calls for any calculation based on a number of shares of Common Stock
held by the Founder or an Investor, the number of shares deemed to be held by
the Founder or an Investor shall be the total number of shares of Common Stock
then owned by the Founder or such Investor, plus the total number of shares of
Common Stock issuable upon conversion of any Preferred Stock or other
convertible securities or exercise of any vested options, warrants or
subscription rights then owned by the Founder or such Investor.

     Section 1.3 Defined Terms. The following capitalized terms, as used in this
     ----------- -------------
Agreement, shall have the meanings set forth below.

     An "Affiliate" of any Person means a Person that directly or indirectly,
through one or more intermediaries, controls, is controlled by or is under
common control with the first mentioned Person.  A Person shall be deemed to
control another Person if such first Person possesses directly or indirectly the
power to direct, or cause the direction of, the management and policies of the
second Person, whether through the ownership of voting securities, by contract
or otherwise.

     "Amended Charter" means the Company's Amended and Restated Certificate of
Incorporation in effect as of the date hereof.

     "Board of Directors" means the Board of Directors of the Company,

     "Commission" means the Securities and Exchange Commission.

     "Common Stock" means the Common Stock, $.001 par value per share, of the
Company and any other shares of stock issued or issuable with respect thereto
(whether by way of a stock dividend or stock split or in exchange for or in
replacement of or upon conversion of such shares or otherwise in connection with
a combination of shares, recapitalization, merger, consolidation or other
corporate reorganization).

     "Exchange Act" means the Securities Exchange Act of 1934, as amended from
time to time, and the rules and regulations promulgated thereunder.

     "Indebtedness" means with respect m any Person, (i) any liability,
contingent or otherwise, of such Person (A) for borrowed money (whether or not
recourse of the lender is to the whole of the assets of such Person or only to a
portion thereof), (B) evidenced by a note, debenture or similar instrument
(including a purchase money obligation) given in connection with the acquisition
of any property or assets, (C) for any letter of credit or performance bond in
favor of such Person, (D) for the payment of money relating to a capitalized
lease obligation, or (E) any liability, contingent or otherwise (excluding trade
payables to trade creditors in the ordinary course of business), of such Person
to any other Person for any purchase price

                                       2
<PAGE>

associated with any acquisition of assets, business or otherwise (including any
deferred purchase price, assumption of Indebtedness, noncompetition payments or
other forms of consideration); (ii) any liability of others of the kind
described in the preceding clause (i), which the Person has guaranteed or which
is otherwise its legal liability, contingent or otherwise; and (iii) any and all
deferrals, renewals, extensions or refinancing of, or amendments, modifications
of supplements to, any liability of the kind described in any of the preceding
clauses (i) or (ii).

     "Liens" means any interest in, or claim against, property relating to an
obligation owed to, or claim by, a Person other than the owner of the property,
whether such interest is based on the common law, statute or contract, and
including but not limited to any security interest lien arising from a mortgage,
encumbrance, pledge, conditional sale or trust receipt or a lease, consignment
or bailment for security purposes, any rights of first refusal, charges, claims,
liabilities, limitations, conditions, restrictions or other adverse claims.

     "Person" means an individual, a corporation, an association, a partnership,
a limited liability company, an estate, a trust, and any other entity or
organization, governmental or otherwise.

     "Purchaser Group" means, collectively, the Founder and the Investors.

     "Qualified Public Offering" means the Company's first underwritten public
offering on a firm commitment basis by a nationally recognized investment
banking organization or organizations, pursuant to an effective registration
statement under the Securities Act covering the offer and sale of shares of the
Company's Common Stock (i) in which the proceeds received by the Company (after
deduction of underwriter discounts and commissions) equal or exceed $20,000,000,
(ii) with respect to which such Common Stock is listed for trading on either the
New York Stock Exchange or the Nasdaq National Market and (iii) either (A) at a
price per share of Common Stock, after underwriter discounts and commissions, of
not less than $9.20 per share (appropriately adjusted for any stock split, stock
dividend, combination, recapitalization and the like), or (B) the pre-money
market value of the Company's Common Stock based upon the initial offering price
is equal to or in excess of $100,000,000.

     "Registrable Securities" means (i) any shares of Common Stock held by an
Investor, (ii) any shares of Common Stock subject to acquisition by an Investor
upon conversion of the shares of Preferred Stock (it being understood that if an
Investor owns Preferred Stock, the Investor may exercise its registration rights
hereunder by converting the shares to be sold under the relevant registration
statement into Common Stock as of the closing of the relevant offering and shall
not be required to cause such Preferred Stock to be converted to Common Stock
until and unless such closing occurs) (iii) any shares of Common Stock issuable
pursuant to the exercise of any vested warrants, options or other securities
convertible into Common Stock held by an Investor and (iv) any securities issued
and issuable with respect to any such shares described in clauses (i) or (ii)
above by way of a stock dividend or stock split or in connection with a
combination of shares, recapitalization, merger, consolidation or other
reorganization; provided, however, that notwithstanding anything to the contrary
                --------  -------
contained herein, "Registrable Securities" shall, for purposes of Section 4.1
only, include shares of Common Stock held by the Founder and the Management
Stockholder, including shares of Common Stock issuable pursuant to the exercise
of any vested warrants, options or other securities convertible into Common
Stock held

                                       3
<PAGE>

by such individuals and shall not include at any time securities (i) sold in a
registered sale pursuant to an effective registration statement under the
Securities Act, (ii) sold to the public pursuant to Rule 144 under the
Securities Act or (iii) which could then be sold in their entirety pursuant to
Rule 144(k) under the Securities Act without limitation or restriction.

     "Securities Act" means the Securities Act of 1933, as amended from time to
time, and the rules and regulations promulgated thereunder.

     "Subsidiary" means any corporation more than 50% of the outstanding voting
securities of which, or any partnership, joint venture or other entity more than
50% of the total equity interest of which, is directly or indirectly owned by
the Company or any other entity otherwise controlled by or under common control
with the Company.

     "Transfer" means any direct or indirect transfer, donation, sale,
assignment, pledge, hypothecation, grant of a security interest in or other
disposal or attempted disposal of all or any portion of a security or of any
rights.  "Transferred" means the accomplishment of a Transfer, and "Transferee"
means the recipient of a Transfer.

ARTICLE II   RESTRICTIONS ON TRANSFER: RIGHTS OF FIRST REFUSAL; CO-SALE RIGHTS
----------   -----------------------------------------------------------------

     Section 2.1 Restrictions on Transfer. Each Stockholder and Investor agrees
     ----------- ------------------------
that he, she or it will not Transfer all or any portion of the shares of capital
stock of the Company now owned or hereafter acquired by him, her or it, except
in connection with, and strictly in compliance with the conditions of, any of
the following:

          (a) Transfers effected pursuant to Sections 2.2, 2.3 or 2.4 hereof and
which are made strictly in accordance with the procedures set forth therein;

          (b) Transfers by such Stockholder or Investor to his or her spouse,
children, parents or grandchildren or to a trust of which he or she is the
settlor and a trustee for the benefit of his or her spouse, children, parents,
grandchildren or charitable foundations, provided that the Transferee of any
Stockholders shall have executed a Joinder Agreement in the form of Exhibit A
                                                                    ---------
attached hereto and the Transferee of any Investor shall have executed a Joinder
Agreement in the form of Exhibit B attached hereto;
                         ---------

          (c) Transfers upon the death of such Stockholder or Investor to his or
her heirs, executors or administrators or to a trust under his or her will or
Transfers between such Stockholder or Investor and his or her guardian or
conservator, provided that the Transferee of any Stockholder shall have executed
a Joinder Agreement in the form of Exhibit A attached hereto and the Transferee
                                   ---------
of any Investor shall have executed a Joinder Agreement in the form of Exhibit B
                                                                       ---------
attached hereto;

          (d) Transfers by such Investor (i) among its Affiliates; (ii) to any
current or retired partner, member or employee of such Investor or a general
partner or managing member of such Investor; (iii) to a liquidating trust
established for the benefit of any current or retired partners or members of
such Investor; or (iv) to any investment fund or other entity controlled or

                                       4
<PAGE>

managed by an Affiliate of such Investor, provided that, in each case, the
                                          --------
Transferee shall have executed a Joinder Agreement in the form of Exhibit B
                                                                  ---------
attached hereto;

          (e) Transfers by the Founder to the Company pursuant to, and strictly
in accordance with, the terms of Section 1.6 of the Series A Purchase Agreement;
and

          (f) Transfers by the Series B Investor in connection with a merger or
combination or sale of substantial assets of the Series B Investor with or into
or to any other entity, provided that the Transferee shall have executed a
                        --------
Joinder Agreement in the form of Exhibit B attached hereto.
                                 ---------

     Any permitted Transferee described in the preceding clauses (b), (c), (d)
or (f) shall be referred to herein as a "Permitted Transferee."  Notwithstanding
anything to the contrary in this Agreement or any failure to execute a Joinder
Agreement as contemplated hereby, Permitted Transferees shall take any shares so
Transferred subject to all provisions of this Agreement as if such shares were
still held by the transferor, whether or not they so agree with the transferor
and/or the Company.  Without limitation of the foregoing, in connection with any
otherwise permitted Transfer of shares of capital stock that are restricted
shares and are subject to any stock restriction agreement, any Transferee of any
such shares shall agree in writing to be bound by the terms of any such stock
restriction or similar agreement, including, without limitation, any repurchase
or similar right contained therein.

     Section 2.2 Right of First Refusal. In the event that any Stockholder or
     ----------- ----------------------
Investor or any of their Permitted Transferees (a "Transferring Stockholder")
desires to Transfer all or any portion of the shares of capital stock of the
Company held by such Transferring Stockholder, other than (i) to a Permitted
Transferee or pursuant to Section 2.1 hereof, or (ii) a Transfer of shares by
the Founder which constitutes a Change in Control (as hereinafter defined) which
is subject to Section 2.4 hereof, such Transferring Stockholder may, subject to
the provisions of Section 2.3 hereof, if applicable, Transfer such shares only
pursuant to and in accordance with the following provisions of this Section 2.2:

          (a) Such Transferring Stockholder shall deliver written notice (the
"Offer Notice") to the Company and to the Purchaser Group of its desire to sell
all or a portion of its capital stock and shall otherwise comply with the
provisions of this Section 2.2. The Offer Notice shall specify (i) the number of
shares that the Transferring Stockholder desires to sell (the "Offered Shares"),
(ii) the consideration per share that the Transferring Stockholder desires to be
paid for the Offered Shares and (iii) all other material terms and conditions
pursuant to which the Transferring Stockholder desires to sell the Offered
Shares. The Transferring Stockholder's Offer Notice shall constitute an
irrevocable offer to sell all such shares to the Company and the Purchaser Group
on the basis described below at a purchase price equal to the price contained
in, and on the same terms as set forth in, the Offer Notice.

          (b) The Company and the Purchaser Group shall have the right (the
"Right of First Refusal") to accept the offer to purchase the Offered Shares for
the consideration per share and on the terms and conditions specified in the
Offer Notice in the order of priority described below.

                                       5
<PAGE>

           (i) The Company shall have the first right to accept the offer to
     purchase all or any portion of the Offered Shares for the consideration per
     share and on the terms and conditions specified in the Offer Notice.  To
     exercise its Right of First Refusal, the Company shall, within twenty (20)
     days of receipt of the Offer Notice, communicate in writing such election
     to the Transferring Stockholder (with copies to the Purchaser Group).  Such
     written election to purchase shall constitute a valid, legally binding and
     enforceable agreement for the sale and purchase of the Offered Shares.

           (ii) In the event the Company does not exercise its Right of First
     Refusal with respect to all of the Offered Shares, the Company shall notify
     the Transferring Stockholder and the Purchaser Group in writing of such
     fact (such notice, the "Subsequent Offer Notice").  Each member of the
     Purchaser Group shall then have the right to accept the offer to purchase
     up to that number of remaining Offered Shares as shall be equal to the
     product obtained by multiplying (X) the total number of remaining Offered
     Shares by (Y) a fraction, the numerator of which is the total number of
     shares of Common Stock owned by such member on the date of the Subsequent
     Offer Notice (as determined in accordance with Section 1.2 hereof) and the
     denominator of which is the total number of shares of Common Stock then
     held by the Purchaser Group as a whole on the date of the Subsequent Offer
     Notice (as determined in accordance with Section 1.2 hereof), subject to
     increase as hereinafter provided.  The number of shares that each such
     member is entitled to purchase under this Section 2.2 shall be referred to
     as a "ROFR Fraction."  In the event any such member does not wish to
     purchase its ROFR Fraction, then all other members who so elect shall have
     the right to accept the offer to purchase, on a pro rata basis with all who
     so elect (as hereinafter provided), any ROFR Fraction not purchased by such
     member.  Each such other member's pro rata share shall be equal to the
     product obtained by multiplying (X) the ROFR Fraction of the member
     electing not to purchase shares under this Section 2.2 by (Y) a fraction,
     the numerator of which is the total number of shares of Common Stock owned
     by each such other member on the date of the Subsequent Offer Notice (as
     determined in accordance with Section 1.2 hereof) and the denominator of
     which is the total number of shares of Common Stock then held by the
     Purchaser Group, excluding the shares then held by the member electing not
     to purchase its ROFR Fraction.  Each member of the Purchaser Group shall
     have the right to accept the Proposed Transaction by giving notice of such
     acceptance to the Company within twenty (20) days after receipt of the
     Subsequent Offer Notice, which notice shall indicate the maximum number of
     shares subject thereto which such member is willing to purchase in the
     event fewer than all members of the Purchaser Group elect to purchase their
     ROFR Fractions.  In the event that the price set forth in the Offer Notice
     is stated in consideration other than cash or cash equivalents, the Board
     of Directors of the Company may determine the fair market value of such
     consideration, reasonably and in good faith, and the Purchaser Group may
     exercise their Right of First Refusal by payment of such fair market value
     in cash or cash equivalents.  The Company shall notify the Transferring
     Stockholder and the Purchaser Group promptly following any lapse of the
     Right of First Refusal without acceptance thereof or any rejection of the
     Right of First Refusal.

     The closing for any purchase of shares by the Purchaser Group hereunder
shall take place within thirty (30) days after the expiration of the twenty (20)
day period following the receipt of the Subsequent Offer Notice by the Purchaser
Group.

                                       6
<PAGE>

     In the event that the Company and the Purchaser Group do not elect to
exercise the Right of First Refusal with respect to all of the Offered Shares,
the Transferring Stockholder may sell the remaining Offered Shares to a Person
(a "Proposed Transferee") on terms and conditions not less favorable to the
Transferring Stockholder than those set forth in the Offer Notice.  If the
Transferring Stockholder's Transfer to the Proposed Transferee is not
consummated in accordance with the terms and conditions contained in the Offer
Notice within the later of (i) ninety (90) days after the expiration of the
later of the Purchaser Group's Right of First Refusal and the Co-Sale Option set
forth in Section 2.3, if applicable, and (ii) the satisfaction of all
governmental approval or filing requirements, the proposed sale of the Offered
Shares to the Proposed Transferee shall be deemed to lapse, and any Transfers of
Offered Shares shall be deemed to be in violation of the provisions of this
Agreement unless the Company and the Purchaser Group are once again afforded the
Right of First Refusal provided for herein with respect to such Offered Shares.

     Section 2.3 Co-Sale Option. In the event that the Founder wishes to sell
     ----------- --------------
all or a portion of his shares of capital stock of the Company pursuant to
Section 2.2 hereof in a transaction involving aggregate net proceeds in excess
of $1,000,000 which does not constitute a Change in Control, and the Rights of
First Refusal are not exercised with respect to all of the Offered Shares
proposed to be so sold, the Founder may Transfer such Offered Shares only
pursuant to add in accordance with the following provisions of this Section 2.3:

          (a) The Investors shall have the right to participate in the sale of
such Offered Shares on the terms and conditions herein stated (the "Co-Sale
Option"), which right shall be exercisable upon written notice (the "Acceptance
Notice") to the Founder within twenty (20) days after the Founder notifies the
Investors in writing that the Company and the Purchaser Group have not elected
to exercise their Rights of First Refusal with respect to all of such Offered
Shares. The Acceptance Notice shall indicate the maximum number of shares of
capital stock that each Investor wishes to sell (including the number of shares
it would sell if one or more Investors do not elect to participate in the sale)
on the terms and conditions stated in the Offer Notice.

          (b) Each Investor shall have the right to exercise its Co-Sale Option
and sell a portion of its capital stock which is equal to or less than the
product obtained by multiplying (i) the total number of Offered Shares that were
proposed to be sold by the Founder pursuant to Section 2.2 (less any shares
being purchased pursuant to a Right of First Refusal) by (ii) a fraction, the
numerator of which is the total number of shares of Common Stock held by such
Investor on the date of the Acceptance Notice (as determined in accordance with
Section 1.2 hereof) and the denominator of which is the total number of shares
of Common Stock then held by the Founder plus the total number of shares then
deemed to be held by the Investors desiring to participate on the date of the
Acceptance Notice (as determined in accordance with Section 1.2 hereof). To the
extent that one or more Investors elect to not exercise their Co-Sale Option,
then the rights of the other Investors (who exercise their Co-Sale Option) to
sell shares pursuant to their Co-Sale Option shall be increased proportionately
by the full amount of shares which the non-electing Investors were entitled to
sell pursuant to this Section 2.3.

          (c) Within ten (10) days after the date by which the Investors were
first required to notify the Founder of their intent to exercise their Co-Sale
Option, the Founder shall

                                       7
<PAGE>

notify each participating Investor of the number of shares held by such Investor
that will be included in the sale and the date on which such sale will be
consummated, which shall be no later than the later of (i) ninety (90) days
after the date by which the Investors were required to notify the Founder of
their intent to exercise the Co-Sale Option and (ii) the satisfaction of any
governmental approval or filing requirements, if any.

          (d) Each Investor participating in a sale under this Section 2.3 may
effect its participation in such sale hereunder by delivery to the Proposed
Transferee, or to the Founder for delivery to the Proposed Transferee, of one or
more instruments or certificates, properly endorsed for transfer, representing
the shares of capital stock it elects to sell therein, provided that no such
Investor shall be required to make any representations or warranties or provide
any indemnities in connection therewith other than with respect to its ownership
of the shares of capital stock being conveyed. At the time of consummation of
the sale, the Proposed Transferee shall remit directly to each such Investor
that portion of the net sale proceeds to which each such Investor is entitled by
reason of its participation therein (less any adjustments due to the conversion
of any convertible securities or the exercise of any exercisable securities).

          (e) So long as the Proposed Transferee is neither a party, nor an
Affiliate of a party, to this Agreement, such Proposed Transferee shall take the
shares so Transferred free and clear of any further restrictions of this Article
II. In the event that the sale is not consummated within the period required by
subsection (c) hereof or the Proposed Transferee fails to timely remit to each
Investor its portion of the sale proceeds, such sale shall be deemed to lapse,
and any Transfers of shares of capital stock pursuant to such sale shall be
deemed to be in violation of the provisions of this Agreement unless the Founder
once again complies with the provisions of Sections 2.2 and/or 2.3 hereof with
respect to such Offered Shares.

     Section 2.4  Change in Control.
     -----------  -----------------

          (a) If the Founder determines to sell or exchange (in a business
combination or otherwise) in one or a series of bona fide arms-length
transactions to an unaffiliated third party all of the shares held by him and,
in connection with such transaction or transactions, the implied equity value of
the Company, on a fully-diluted basis, shall be no less than $125,000,000 (a
"Change in Control"), then upon thirty (30) days written notice from the Founder
to the Stockholders and the Investors, winch notice shall specify all material
terms and conditions, including the consideration to be received, of such
proposed Change in Control, each other Stockholder and each Investor shall be
obligated to, and shall (i) sell, Transfer and deliver or cause to be sold,
Transferred and delivered, to such third party, all of its or his shares in the
same Change in Control transaction at the closing thereof (and will deliver
certificates for all of its or his shares at the closing, free and clear of all
claims, liens and encumbrances), and each such Stockholder and Investor shall
receive the same consideration per share of Common Stock upon such sale as to be
received by the Founder and (ii) if stockholder approval of the transaction is
required, vote its or his shares in favor thereof.

          (b) The provisions of this Section 2.4 shall not apply to any Transfer
(i) pursuant to a Qualified Public Offering, or (ii) to a Permitted Transferee
pursuant to Section 2.1 hereof; provided, however, that any such Permitted
                                --------  -------
Transferee shall be subject to and bound by

                                       8
<PAGE>

the terms of this Section 2.4. A Change in Control transaction subject to this
Section 2.4 shall not be subject to the provisions of Section 2.2 or 2.3.

     Section 2.5 Sales to Competitors. Each Stockholder and Investor hereby
     ----------- --------------------
agrees not to directly or indirectly Transfer any shares of Common Stock or
other securities of the Company or options in respect thereof to any Person
whose activities, products or services are competitive with activities, products
or services of the Company as reasonably determined by the Board of Directors,
as of the date of the proposed Transfer; provided, that the foregoing shall not
                                         --------
restrict public sales registered under the Securities Act or pursuant to
Rule 144 thereunder unless the relevant transferor has knowledge that the buyer
or buyers are such competitors. The Company may impose stop transfer
instructions with its transfer agent in order to enforce the foregoing covenant.

     Section 2.6  Prohibited Transfers. If any Transfer is made or attempted
     -----------  --------------------
contrary to the provisions of this Agreement, such purported Transfer shall be
void ab initio; the Company, the Investors and the Stockholders shall have, in
addition to any other legal or equitable remedies which they may have, the right
to enforce the provisions of this Agreement by actions for specific performance
(to the extent permitted by law); and the Company shall have the right to refuse
to recognize any Transferee as one of its stockholders for any purpose. Without
limitation to the foregoing, each of the Investors and the Stockholders further
agrees that the provisions of Section 7.8 shall apply in the event of any
violation or threatened violation of this Agreement.

ARTICLE III    RIGHTS TO PURCHASE
-----------    ------------------

       Section 3.1  Right to Participate in Certain Sales of Additional
       -----------  ---------------------------------------------------
Securities. The Company agrees that it will not sell or issue any shares of
----------
capital stock of the Company, or other securities convertible into or
exchangeable for capital stock of the Company, or options, warrants or rights
carrying any rights to purchase capital stock of the Company unless the Company
first submits written notice to the Purchaser Group identifying the terms of the
proposed sale (including price, number or aggregate principal mount of
securities and all other material terms), and offers to each member of the
Purchaser Group the opportunity to purchase its Pro Rata Allotment (as
hereinafter defined) of the securities (subject to increase for over-allotment
if any member of the Purchaser Group does not fully exercise its rights) on
terms and conditions, including price, not less favorable than those on which
the Company proposes to sell such securities to a third party or parties. The
Company's offer to the Purchaser Group shall remain open and irrevocable for a
period of thirty (30) days during which time each member of the Purchaser Group
may accept such offer by written notice to the Company Setting forth the maximum
number of shares or other securities to be purchased by any such member,
including the number of shares or securities which such member would purchase if
other members of the Purchaser Group do not elect to purchase, with the rights
of electing members to purchase such additional shares or securities to be based
on the relative holdings of shares of Common Stock of such electing members (as
determined in accordance with Section 1.2 hereof). Any securities so offered
which are not purchased by the Purchaser Group pursuant to such offer may be
sold by the Company, but only on the terms and conditions set forth in the
initial offer to the Purchaser Group, at any time within 120 days following the
termination of the above-referenced 30-day period. For purposes of this Section
3.1, the "Pro Rata Allotment" of securities for each member of the Purchaser
Group shall be based on the ratio (as determined in accordance with Section 1.2

                                       9
<PAGE>

hereof) which the shares of Common Stock held by it bears to all of the then
issued and outstanding shares of Common Stock, calculated on a fully-diluted
basis, as of the date of such written offer.

     Notwithstanding the foregoing, the right to purchase shall be inapplicable
with respect to any issuance by the Company of (i) shares of Common Stock or
options to purchase shares of Common Stock to its employees, directors and
consultants pursuant to stock and option plans approved by the Board of
Directors (including the Series A Investor Nominee and the Series B Investor
Nominee), (ii) Common Stock upon conversion of the Preferred Stock, (iii)
securities as a result of any stock split, stock dividend, reclassification or
reorganization of the Company's Common Stock, and (iv) shares of Common Stock to
be issued in connection with strategic acquisitions approved by a majority of
the members of the Board of Directors (subject to any required consent of a
Series A Investor Nominee (as hereinafter defined) or Series B Investor Nominee
(as hereinafter defined) pursuant to Section 6.3(i) hereof).

     Section 3.2  Assignment of Rights. The rights of the Purchaser Group set
     -----------  --------------------
forth in this Article III are transferable to each Transferee of shares of
capital stock of the Company hereunder. Each such subsequent holder of such
shares must consent in writing to be bound by the terms and conditions of this
Agreement in order to acquire the rights granted hereunder.

ARTICLE IV   REGISTRATION RIGHTS
----------   -------------------

     Section 4.1  Optional Registrations.  If at any time or times after the
     -----------  ----------------------
date hereof the Company shall seek to register any shares of its Common Stock
under the Securities Act for sale to the public (except with respect to
registration statements on Form S-4, S-8 or another form not available for
registering the Registrable Securities for sale to the public), the Company will
promptly give written notice thereof to all holders of Registrable Securities
(the "Holders") and the Founder and, with respect only to the initial public
offering of the Company, the Management Stockholder (collectively referred to
herein as the "Other Holders"). If within thirty (30) days after their receipt
of such notice one or more Holders or Other Holders request the inclusion of
some or all of the Registrable Securities owned by them in such registration,
the Company will use its best efforts to effect the registration under the
Securities Act of such Registrable Securities. In the case of the registration
of shares of capital stock by the Company in connection with any underwritten
public offering, if the underwriter(s) determines that marketing factors require
a limitation on the number of Registrable Securities to be offered, subject to
the following sentence, the Company shall not be required to register
Registrable Securities of the Holders or Other Holders in excess of the amount,
if any, of shares of the capital stock which the principal underwriter of such
underwritten offering shall reasonably and in good faith agree to include in
such offering in addition to any amount to be registered for the account of the
Company. If any limitation of the number of shares of Registrable Securities to
be registered by the Holders or Other Holders is required pursuant to this
Section 4.1, the number of shares to be excluded shall be determined in the
following sequence: (i) first, securities held by any Persons not having any
contractual, incidental "piggyback" rights, (ii) second, securities held by any
Persons (other than the Holders or Other Holders) having contractual, incidental
"piggyback" rights pursuant to an agreement which is not this Agreement and
(iii) third, Registrable Securities sought to be included by the Holders or
Other Holders under this Section 4.1 as determined on a pro rata basis (based
upon the respective holdings of securities by such

                                       10
<PAGE>

Holders or Other Holders); provided, however, that the Registrable Securities
                           --------  -------
sought to be included by the Holders shall not be excluded hereunder unless and
until they have received net proceeds from the sale of Registrable Securities
equal to or in excess of the aggregate purchase price paid by such Holders under
the Series A Purchase Agreement and Series B Purchase Agreement, as applicable;
provided, further, however, that (i) Registrable Securities held by the Founder
--------  -------  -------
in the Company's initial public offering shall be reduced on an equal basis with
Registrable Securities held by the Holders and (ii) the Management Stockholder
shall be subject to any cutbacks determined by the managing underwriter for such
initial public offering.

     Section 4.2  Required Registrations.
     -----------  ----------------------

          (a) Demand Registration.  At any time that is six (6) months after the
              -------------------
initial public offering of Common Stock by the Company pursuant to an effective
registration statement under the Securities Act, (i) on not more than two (2)
occasions, the Holders of at least 20% of the Series A Preferred Stock then
issued and outstanding may request that the Company register under the
Securities Act all or a portion of the Registrable Securities held by such
Holders having an aggregate value of at least $7,500,000 (based on the then
current market price) and (ii) on not more than two (2) occasions, the Holders
of at least 20% of the Series B Preferred Stock then issued and outstanding may
request that the Company register under the Securities Act all or a portion of
the Registrable Securities held by such Holders having an aggregate value of at
least $7,500,000 (based on the then current market price).

          (b) Form S-3. After the Company's initial public offering of Common
              --------
Stock registered under the Securities Act, the Company shall use its best
efforts to qualify and remain qualified to register securities on Form S-3 (or
any successor form) under the Securities Act. So long as the Company is
qualified to register securities on Form S-3 (or any successor form), the
Holders of Series A Preferred Stock and the Holders of Series B Preferred Stock,
each acting independently, shall have the right to request, on not more than two
(2) occasions in any consecutive twelve (12) month period, registration on Form
S-3 (or any successor form) for the Registrable Securities held by such
requesting Holders representing no less than 2% of the Company's then
outstanding shares of Common Stock, including registrations for the sale of such
Registrable Securities on a delayed or continuous basis pursuant to Rule 415
under the Securities Act. Such requests shall be in writing and shall state the
number of shares of Registrable Securities to be disposed of and the intended
method of disposition of such shares by such Holder.

          (c) Registration Requirements. Following a request pursuant to Section
              -------------------------
4.2(a) or (b) above, the Company will notify all of the other Holders of
Registrable Securities and such Holders shall then have thirty (30) days to
notify the Company of their desire to participate in the registration.
Thereupon, the Company will use its reasonable best efforts to cause such of the
Registrable Securities as may be requested by such Holders to be registered
under the Securities Act in accordance with the terms of this Section 4.2. If
the request for registration contemplates an underwritten public offering, the
Company shall state such in the written notice and in such event the right of
any Person to participate in such registration shall be conditioned upon their
participation in such underwritten public offering and the inclusion of their
securities in the underwritten public offering to the extent provided herein.

                                       11
<PAGE>

          (d) Underwritten Offering.  If a requested registration involves an
              ---------------------
underwritten public offering and the managing underwriter of such offering
determines in good faith that the number of securities sought to be offered
should be limited due to market conditions, then the number of securities to be
included in such underwritten public offering shall be reduced to a number
deemed satisfactory by such managing underwriter, provided that the shares to be
excluded shall be determined in the following sequence: (i) first, securities
held by any Persons not having any contractual, incidental "piggyback" fights,
(ii) second, securities held by any other Persons (other than the Holders)
having contractual, incidental "piggy back" rights, (iii) third, Registrable
Securities of Holders who did not make the original request for registration and
(iv) fourth, Registrable Securities of Holders who requested such registration.
If there is a reduction of the number of Registrable Securities pursuant to
clauses (iii) or (iv) such reduction shall be made on a pro rata basis (based
upon the aggregate number of shares of Registrable Securities held by each such
Holder).  With respect to a request for registration pursuant to Section 4.2(a)
or (b) which is for an underwritten public offering, the managing underwriter
shall be chosen by the Board of Directors of the Company, subject to the consent
of a majority-in-interest of the Holders of Registrable Securities requesting
such registration, which consent will not be unreasonably withheld.  If the
managing underwriter has not limited the number of Registrable Securities or
other securities to be underwritten, the Company may include securities for its
own account in such registration if the managing underwriter so agrees and if
the number of Registrable Securities and other securities which would otherwise
have been included in such registration and underwriting will not thereby be
limited.

          (e) Postponement. The Company may postpone the filing of any
              ------------
registration statement required hereunder for a reasonable period of time, not
to exceed one hundred and twenty (120) days in the aggregate during any twelve-
month period, if the Company has been advised by legal counsel that such filing
would require a special audit or the disclosure of material nonpublic
information or a material impending transaction or other matter and the
Company's Board of Directors determines reasonably and in good faith that such
disclosure would be inappropriate or inadvisable. The Company may not cause any
other registration of securities for sale for its own account (other than a
registration effected solely to implement an employee benefit plan or a
transaction to which Rule 145 or any other similar rule under the Securities Act
is applicable) to become effective within one hundred eighty (180) days
following the effective date of any registration required pursuant to this
Article IV or such lesser period as may be consented to by the managing
underwriter. The Company shall not be required to cause a registration statement
requested pursuant to this Article IV to become effective prior to ninety (90)
days following the effective date of a registration statement initiated by the
Company (or 180 days in the case of the Company's initial public offering of
Common Stock), if the request for registration has been received by the Company
subsequent to the giving of written notice by the Company, made in good faith,
to Holders entitled to request demand registrations under this Article IV that
the Company is commencing to prepare a Company-initiated registration statement
(other than a registration effected solely to implement an employee benefit plan
or a transaction to which Rule 145 or any other similar rule under the
Securities Act is applicable); provided, however, that the Company shall use its
                               --------  -------
best efforts to achieve such effectiveness promptly following such period. A
registration will not count as a requested registration under Section 4.2(a)
hereof until the registration statement relating to such registration has been
declared effective by the Commission at the request of the initiating Holders;
provided, however, that if a majority-in-interest of the participating Holders
--------  -------
of Registrable Securities shall request, in

                                       12
<PAGE>

writing, that the Company withdraw a registration statement which has been filed
under Section 4.2(a) hereof but not yet been declared effective, a majority-in-
interest of such Holders may thereafter request the Company to reinstate such
registration statement, if permitted under the Securities Act, or to file
another registration statement, in accordance with the procedures set forth
herein, in which case, the incremental fees and expenses incurred by the Company
in connection with such reinstatement or filing shall be borne by the Holders.

     Section 4.3 Further Obligations of the Company. Whenever the Company is
     ----------- ----------------------------------
required hereunder to register any Registrable Securities, it agrees that it
shall also do the following:

          (a) Pay all expenses of such registrations and offerings (exclusive of
underwriting discounts and commissions) and the reasonable fees and expenses
(not to exceed $20,000) of not more than one independent counsel for the Holders
(selected by a majority-in-interest of the Holders who participate in the
registration) in connection with any registrations hereunder;

          (b) Use its reasonable best efforts to prepare and file with the
Commission a registration statement and such amendments and supplements to said
registration statement and the prospectus used in connection therewith as may be
necessary to keep said registration statement effective until the Holder or
Holders have completed the distribution described in the registration statement
relating thereto (but for no more than 180 days or such other lesser period
until all such Registrable Securities have been sold) and to comply with the
provisions of the Securities Act with respect to the sale of securities covered
by said registration statement for such period;

          (c) Furnish to each selling Holder such copies of each preliminary and
final prospectus and such other documents as such Holder may reasonably request
to facilitate the public offering of its Registrable Securities;

          (d) Enter into any reasonable underwriting agreement required by the
proposed underwriter, if any, in such form and containing such terms as are
customary; provided, however, that no Holder shall be required to make any
           --------  -------
representations or warranties other than with respect to its title to the
Registrable Securities and with respect to any written information provided by
the Holder to the Company, and if the underwriter requires that representations
or warranties be made and that indemnification be provided, the Company shall
make all such representations and warranties and provide all such indemnities,
including, without limitation, in respect of the Company's business, operations
and financial information and the disclosures relating thereto in the
prospectus;

          (e) Use its best efforts to register or qualify the securities covered
by said registration statement under the securities or "blue sky" laws of such
jurisdictions as any selling Holder may reasonably request; provided, that the
                                                            --------
Company shall not be required to register or qualify the securities in any
jurisdictions in which such registration or qualification would require it to
qualify to do business therein;

                                       13
<PAGE>

          (f) Immediately notify each selling Holder, at any time when a
prospectus relating to his, her or its Registrable Securities is required to be
delivered under the Securities Act, of the happening of any event as a result of
which such prospectus contains an untrue statement of a material fact or omits
any material fact necessary to make the statements therein not misleading, and,
at the request of any such selling Holder, prepare a supplement or amendment to
such prospectus so that, as thereafter delivered to the purchasers of such
Registrable Securities, such prospectus will not contain any untrue statement of
a material fact or omit to state any material fact necessary to make the
statements therein not misleading;

          (g) Cause all such Registrable Securities to be listed on each
securities exchange or quotation system on which similar securities issued by
the Company are then listed or quoted;

          (h) Otherwise use its best efforts to comply with the securities laws
of the United States and other applicable jurisdiction and all applicable rules
and regulations of the Commission and comparable governmental agencies in other
applicable jurisdictions and make generally available to its holders, in each
case as soon as practicable, but not later than 45 days after the close of the
period covered thereby, an earnings statement of the Company which will satisfy
the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder
(or any comparable successor provisions);

          (i) Make available to each selling Holder and any attorney, accountant
or other agent or representative retained by any such Holder all financial and
other records, pertinent corporate documents and properties of the Company as
shall be reasonably necessary to enable them to exercise their due diligence
responsibility, and cause the Company's officers, directors and employees to
supply all information so requested in connection with such registration
statement subject, in each case, to such confidentiality agreements as the
Company shall reasonably request;

          (j) Furnish to each selling Holder a signed counterpart, addressed to
such Holder, if and to the extent permitted by applicable professional
standards, a "comfort" letter signed by the independent public accountants who
have certified the Company's financial statements included in the registration
statement, covering substantially the same matters with respect to the
registration statement (and the prospectus included therein) and (in the case of
the accountants' letter) with respect to events subsequent to the date of the
financial statements, as are customarily covered (at the time of such
registration) in accountants' letters delivered to the underwriters in
underwritten public offerings of securities; and

          (k) Otherwise cooperate with the underwriter or underwriters, the
Commission and other regulatory agencies and take all actions and execute and
deliver or cause to be executed and delivered all documents necessary to effect
the registration of any Registrable Securities under this Article IV.

     Section 4.4  Indemnification; Contribution.
     -----------  -----------------------------

          (a) Incident to any registration of any Registrable Securities under
the Securities Act pursuant to this Agreement, the Company will indemnify and
hold harmless each

                                       14
<PAGE>

underwriter, each Holder or Other Holder who offers or sells any such
Registrable Securities in connection with such registration statement (including
its partners (including partners of partners and stockholders of any such
partners), and directors, officers, employees and agents of any of them (a
"Selling Holder"), and each person who controls any of them within the meaning
of Section 15 of the Securities Act or Section 20 of the Exchange Act (a
"Controlling Person")), from and against any and all losses, claims, damages,
expenses and liabilities, joint or several (including any investigation, legal
and other expenses incurred in connection with, and any amount paid in
settlement of, any action, suit or proceeding or any claim asserted, as the same
are incurred), to which they, or any of them, may become subject under the
Securities Act, the Exchange Act or other federal or state statutory law or
regulation, at common law or otherwise, insofar as such losses, claims, damages
or liabilities arise out of or are based on (i) any untrue statement or alleged
untrue statement of a material fact contained in such registration statement
(including any related preliminary or definitive prospectus, or any amendment or
supplement to such registration statement or prospectus), (ii) any omission or
alleged omission to state in such document a material fact required to be stated
in it or necessary to make the statements in it not misleading, or (iii) any
violation by the Company of the Securities Act, any state securities or "blue
sky" laws or any rule or regulation thereunder in connection with such
registration; provided, however, that the Company will not be liable to the
              --------  -------
extent that such loss, claim, damage, expense or liability arises from and is
based on an untrue statement or omission or alleged untrue statement or omission
made in reliance on and in conformity with information furnished in writing to
the Company by such underwriter, Selling Holder or Controlling Person expressly
for use in such registration statement.  With respect to such untrue statement
or omission or alleged untrue statement or omission in the information furnished
in writing to the Company by such Selling Holder expressly for use in such
registration statement, such Selling Holder will indemnify and hold harmless
each underwriter, the Company (including its directors, officers, employees and
agents), each other Holder (including its partners (including partners of
partners and stockholders of such partners) and directors, officers, employees
and agents of any of them, and each person who controls any of them within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act),
from and against any and all losses, claims, damages, expenses and liabilities,
joint or several, to which they, or any of them, may become subject under the
Securities Act, the Exchange Act or other federal or state statutory law or
regulation, at common law or otherwise to the same extent provided in the
immediately preceding sentence; provided, however, that no Selling Holder shall
                                --------  -------
be required to indemnify any Person against any liability arising from any
untrue or misleading statement or omission contained in any preliminary
prospectus if such deficiency is corrected in the final prospectus or for any
liability which arises out of the failure of any Person to deliver a prospectus
as required by the Securities Act.  In no event, however, shall the liability of
a Selling Holder for indemnification under this Section 4.4(a) exceed the lesser
of (i) such Selling Holder's pro rata share of the total of such losses, claims,
damages or liabilities or (ii) the proceeds received by such Selling Holder from
its sale of Registrable Securities under such registration statement.

          (b) If the indemnification provided for in Section 4.4(a) above for
any reason is held by a court of competent jurisdiction to be unavailable to an
indemnified party in respect of any losses, claims, damages, expenses or
liabilities referred to therein, then each indemnifying party under this Section
4.4, in lieu of indemnifying such indemnified party thereunder, shall contribute
to the amount paid or payable by such indemnified party as a result of such
losses, claims, damages, expenses or liabilities (i) in such proportion as is
appropriate to reflect the

                                       15
<PAGE>

relative benefits received by the Company, the other Selling Holders and the
underwriters from the offering of the Registrable Securities or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company, the
other Selling Holders and the underwriters in connection with the statements or
omissions which resulted in such losses, claims, damages, expenses or
liabilities, as well as any other relevant equitable considerations; provided,
however, that in the event of a registration statement filed in response to a
demand under Section 4.2 and in which the Company does not register any shares
of capital stock, the proportion of contribution by the Company, the other
Selling Holders and the underwriters shall in all cases be governed by clause
(ii) above. The relative benefits received by the Company, the Selling Holders
and the underwriters shall be deemed to be in the same respective proportions
that the net proceeds from the offering (before deducting expenses) received by
the Company and the Selling Holders and the underwriting discount received by
the underwriters, in each case as set forth in the table on the cover page of
the applicable prospectus, bear to the aggregate public offering price of the
Registrable Securities. The relative fault of the Company, the Selling Holders
and the underwriters 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, the Selling Holders or the underwriters and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.

     The Company, the Selling Holders, and the underwriters agree that it would
not be just and equitable if contribution pursuant to this Section 4.4(b) were
determined by pro rata or per capita allocation or by any other method of
allocation which does not take account of the equitable considerations referred
to in the immediately preceding paragraph.  In no event, however, shall a
Selling Holder be required to contribute any amount under this Section 4.4(b) in
excess of the lesser of (i) such Selling Holder's pro rata share of the total of
such losses, claims, damages or liabilities or (ii) the proceeds received by
such Selling Holder from its sale of Registrable Securities under such
registration statement.  No person found 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 found guilty of such fraudulent
misrepresentation.

          (c) The amount paid by an indemnifying party), or payable to an
indemnified party as a result of the losses, claims, damages and liabilities
referred to in this Section 4.4 shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending any such
action or claim, payable as the same are incurred. The indemnification and
contribution provided for in this Section 4.4 will remain in full force and
effect regardless of any investigation made by or on behalf of the indemnified
parties or any officer, director, employee, agent or controlling person of the
indemnified parties. No indemnifying party, in the defense of any such claim or
litigation, shall enter into a consent of entry of any judgment or enter into a
settlement without the consent of the indemnified party, which consent will not
be unreasonably withheld.

     Section 4.5  Rule 144 and Rule 144A Requirements. In the event that the
     -----------  -----------------------------------
Company becomes subject to Section 13 or Section 15(d) of the Exchange Act, the
Company shall use its best efforts to take all action as may be required as a
condition to the availability of Rule 144 or Rule 144A under the Securities Act
(or any successor or similar exemptive rules hereafter in

                                       16
<PAGE>

effect). The Company shall furnish to any Holder, within 15 days of a written
request, a written statement executed by the Company as to the steps it has
taken to comply with the current public information requirement of Rule 144 or
Rule 144A or such successor rules. After the occurrence of the first
underwritten public offering of Common Stock pursuant to an offering registered
under the Securities Act on Form S-1 or Form SB-1 (or any comparable successor
forms), the Company shall use its reasonable best efforts to facilitate and
expedite transfers of Registrable Securities pursuant to Rule 144 under the
Securities Act, which efforts shall include timely notice to its transfer agent
to expedite such transfers of Registrable Securities.

     Section 4.6  Transferability of Registration Rights. The registration
     -----------  --------------------------------------
rights set forth in this Agreement are transferable (i) subject to Sections 2.1
and 2.2 hereof, to each Transferee of Registrable Securities who receives at
least 50,000 shares of Registrable Securities (appropriately adjusted for any
stock split, stock dividend, combination, recapitalization and the like) or (ii)
to any Permitted Transferee. Each subsequent holder of Registrable Securities
must consent in writing to be bound by the terms and conditions of this
Agreement in order to acquire the rights granted pursuant to this Agreement.

     Section 4.7  Rights Which May Be Granted to Subsequent Investors. Other
     -----------  ---------------------------------------------------
than permitted transferees of Registrable Securities under Section 4.6 hereof,
the Company shall not, without the prior written consent of the holders of not
less than a majority of the outstanding Registrable Securities, (i) permit
purchasers of the Company's securities to become a party to this Agreement or
(ii) grant any other registration rights to any third parties other than
subordinate piggyback registration rights.

ARTICLE V  MARKET STAND-OFF AGREEMENT. In connection with any public offering
---------  --------------------------
by the Company of its Common Stock, each of the Stockholders, the Investors and
the Management Stockholder if requested in good faith by the Company and the
managing underwriter of the Company's securities, shall agree not to, directly
or indirectly, offer, sell, pledge, contract to sell (including any short sale),
grant any option to purchase or otherwise dispose of any securities of the
Company held by him, her or it (except for any securities sold pursuant to such
registration statement) or enter into any Hedging Transaction (as defined below)
relating to any securities of the Company for a period not to exceed 90 days (or
180 days in the case of the Company's initial public offering) following the
effective date of the applicable registration statement as agreed to by such
parties. For purposes of this Article V, "Hedging Transaction" means any short
sale (whether or not against the box) or any purchase, sate or grant of any
right (including without limitation, any put or call option) with respect to any
security (other than a broad-based market basket or index) that includes,
relates to or derives any significant part of its value from the Company's
Common Stock.

ARTICLE VI   ELECTION OF DIRECTORS; ACTIONS REQUIRING BOARD APPROVAL.
----------   -------------------------------------------------------

     Section 6.1  Board Composition.
     -----------  -----------------

          (a) Subject to Section 6.1(b) hereof, each Investor and each
Stockholder (including any Permitted Transferees) agrees to vote all of his, her
or its shares of the Company's capital stock having voting power (and any other
shares over which it exercises voting control)

                                       17
<PAGE>

in connection with the election of directors of the Company and to take such
other actions as are necessary so as to fix the number of members of the Board
of Directors at five (5) and to elect and continue in Office as directors the
following:

               (i)   three (3) individuals nominated by the Founder (so long as
     he owns at least 30% of the issued and outstanding shares of capital stock
     of the Company) and thereafter by the Stockholders holding not less than a
     majority of the outstanding shares of Common Stock then held by the
     Stockholders, at least one of whom shall be the Chief Executive Officer of
     the Company and another of whom shall not be employed by, or be an
     Affiliate of, the Company, any Investor or any Stockholder, which
     individuals shall initially be the Founder, Randy Gray and Michael W.
     Ferro, Sr.; and

               (ii)  one (1) individual nominated by the holders of not less
     than a majority of the outstanding shares of Series A Preferred Stock, who
     shall initially be Jerry Murdock (the "Series A Investor Nominee"); and

               (iii) one (1) individual nominated by the holders of not less
     than a majority of the outstanding shares of Series B Preferred Stock, who
     shall initially be Steve Mahoney (the "Series B Investor Nominee").

          (b) The Company will ensure that meetings of the Board of Directors
are held at least four (4) times each year at intervals of not more than four
(4) months. The Company shall reimburse each Director for his or her reasonable
travel and other reasonable expenses incurred in connection with attending
meetings of the Board of Directors or otherwise in connection with his or her
service as a member of the Board of Directors. The Amended Charter and By-laws
of the Company will provide for exculpation and indemnification of the Directors
and limitations on the liability of the Directors to the fullest extent
permitted under applicable state law, and the Company shall obtain and maintain
reasonable and customary directors' and officers' liability insurance coverage
of at least $3,000,000 and otherwise, on terms reasonably satisfactory to the
Investors.

     Section 6.2 Committees of the Board. The Company and each Investor and
     ----------- -----------------------
Stockholder agree to take such action necessary to establish and maintain an
Audit Committee and a Compensation Committee of the Board of Directors. The
Company and each Investor and Stockholder agree that (i) the Audit Committee
shall be charged with reviewing the Company's financial statements and
accounting practices and (ii) the Compensation Committee shall make all
determinations regarding salary, bonus and other compensation of the officers
and employees of the Company and the determination of any options, restricted
stock or other equity compensation to be granted to employees, officers,
directors, consultants, advisors or independent contractors, at prices
determined in good faith by the Compensation Committee, and otherwise on such
terms as the Compensation Committee shall determine. The composition of each
such committee shall consist of three (3) Directors, one (1) of whom will be the
Series A Investor Nominee and one (1) of whom will be the Series B Investor
Nominee. Each of the Compensation and Audit Committees shall act by majority
resolution of their members.

     Section 6.3  Actions Requiring Board Approval. The Company (which term
     -----------  --------------------------------
shall be deemed to include, for purposes of this Section 6.3, all Subsidiaries
of the Company existing as

                                       18
<PAGE>

of, and formed after, the date of this Agreement) shall not, without first
having obtained the affirmative vote or written consent of a majority of the
members of the Board of Directors, which majority shall include the Series A
Investor Nominee and the Series B Investor Nominee:

          (a) amend, alter, repeal or waive any provision of, or add any
provision to, the Amended Charter or the Company's By-laws (other than in
connection with a QPO or the merger or acquisition of the Company approved by a
majority of the members of the Board of Directors, subject to any consent of the
Series A Investor Nominee and Series B Investor Nominee pursuant to this Section
6.3);

          (b) recapitalize or reclassify any class or series of its capital
stock;

          (c) take any action or enter into any agreement to authorize, sell or
issue any equity securities other than at fair market value or options, warrants
or other securities convertible into or exchangeable for equity securities of
the Company; provided, however, that the Company may issue shares of Common
             --------  -------
Stock or options to purchase shares of Common Stock to employees, directors and
consultants of the Company pursuant to stock and option plans approved by the
Compensation Committee;

          (d) directly or indirectly, through subsidiaries or otherwise, redeem,
purchase or otherwise acquire for consideration any shares of its Common Stock
or any other class of its capital stock, except for (i) the redemption of the
Preferred Stock pursuant to and as provided in the Amended Charter, (ii) the
repurchase of shares of Common Stock at the original purchase price thereof from
employees, directors or consultants of the Company, other than shares of Common
Stock owned by Michael W. Ferro, Jr., Richard Weingarten and John T. Garber, II,
pursuant to agreements under which the Company has the option or obligation to
repurchase such shares upon the occurrence of certain events, including
termination of employment and (iii) the redemption of shares of Common Stock
from the Founder and the certain additional stockholders of the Company in
accordance with Section 1.6 of the Series A Purchase Agreement;

          (e) declare or pay any dividends or make any distributions of cash,
property or securities of the Company with respect to any shares of its Common
Stock or any other class of its capital stock (other than dividends payable by
the Company solely in shares of Common Stock);

          (f) liquidate, dissolve or wind up the Company or sell, lease, convey,
exchange, transfer or otherwise dispose of the assets of the Company outside the
ordinary course of business or facilitate the sale of all or a majority of the
outstanding capital stock of the Company (whether in one or a series of related
transactions), other than a Change in Control transaction in which the Founder
exercises his rights under Section 2.4 hereof and in connection with such
transaction the equity value of the Company, on a fully-diluted basis, shall be
no less than $125,000,000;

          (g) merge or consolidate with any other corporation, other than a
Change in Control transaction in which the Founder exercises his rights under
Section 2.4 hereof and in

                                       19
<PAGE>

connection with such transaction the equity value of the Company, on a fully -
diluted basis, shall be no less than $125,000,000;

          (h) effect any transaction or series of related transactions in which
more than fifty percent (50%) of the voting power of the Company is disposed of,
in connection with such transaction the equity value of the Company, on a fully-
diluted basis, shall be no less than $125,000,000;

          (i) acquire any other corporation or business concern whether by
acquisition of assets, capital stock or otherwise, and whether in consideration
of the payment of cash, the issuance of capital stock or otherwise, or make any
investment in another business entity or any joint venture or similar
arrangement in one transaction or a series of related transactions (A) in which
the value of any such transaction or transactions exceeds $2,000,000 or (B) if
the activities performed by such corporation or business concern are unrelated
to those performed by the Corporation;

          (j) increase the size of the Board of Directors to more than five (5);

          (k) make any expenditures in excess of $500,000 which were not
otherwise included in the Company's annual operating budget presented to the
Board of Directors;

          (l) make any change in the Company's independent certified public
accountants or change, adopt or modify any accounting method or policy or tax
policy (other than as required under generally accepted accounting principles);

          (m) make any material change in the strategic direction or nature of
the Company's business as carried out on the date of this Agreement except to
the extent contemplated in the Company's draft business plan dated November 30,
1998 as updated and revised from time to time as approved by a majority of the
Board of Directors (including the Series A Investor Nominee and the Series B
Investor Nominee);

          (n) incur, create, assume, become or be liable in any manner with
respect to, any long-term Indebtedness for money borrowed, except (i)
Indebtedness incurred in the normal course of the Company's business, including
for working capital needs, improvements and expansion so long as such
Indebtedness does not exceed $250,000 at any one time or (ii) Indebtedness
incurred for purchase money obligations and capitalized lease obligations, so
long as: (x) the pertinent assets are acquired for use in the ordinary course of
the Company's business, (y) the Indebtedness secured thereby does not exceed the
fair market value of such assets and (z) the aggregate mount of such
Indebtedness does not exceed $250,000 at any one time;

          (o) pledge or grant a security interest in any of its assets
(including any leasehold interests in property used by the Company) or ownership
interests now or hereafter owned, other than as collateral for Indebtedness
permitted under Section 6.3(n) above; and

          (p) amend any employment agreement with the Founder or change the
compensation paid thereunder in any material respect.

                                       20
<PAGE>

     Section 6.4  Assignment. Each Investor and each Stockholder agrees, as a
     -----------  ----------
condition to any Transfer of his, her or its shares, to cause the Transferee to
agree to the provisions of this Article VI, whereupon such Transferee shall be
subject to the provisions hereof.

ARTICLE VII   GENERAL
-----------   -------

     Section 7.1  Amendments, Waivers and Consents. For the purposes of this
     -----------  --------------------------------
Agreement, no course of dealing between or among any of the parties hereto and
no delay on the part of any party hereto in exercising any rights hereunder
shall operate as a waiver of the rights hereof. This Agreement may not be
amended or modified or any provision hereof waived without the joint written
consent of the Company, the Stockholders holding not less than a majority of the
outstanding shares of Common Stock then held by the Stockholders and the holders
of not less than a majority of the outstanding shares of Series A Preferred
Stock and the holders of not less than a majority of the outstanding shares of
Series B Preferred Stock, each voting separately as a class, provided, that any
party may waive any provision hereof intended for its benefit by written
consent; and provided, further, that (i) the provisions contained in Article II
             --------  -------
may be amended, modified or waived by the written consent of the Company, the
Founder, the holders of not less than a majority of the outstanding shares of
Series A Preferred Stock and the holders of not less than a majority of the
outstanding shares of Series B Preferred Stock, each voting separately as a
class, provided that any such amendment, modification or waiver that
disproportionately and adversely affects any Stockholder shall require the prior
written consent of such Stockholder, (ii) the provisions contained in Article
III may be amended, modified or waived by the written consent of the Company,
the Founder, the holders of not less than a minority of the outstanding shares
of Series A Preferred Stock and the holders of not less than a majority of the
outstanding shares of Series B Preferred Stock, each voting separately as a
class, and (iii) the provisions contained in Article IV and Section 6.3 may be
amended, modified or waived by the written consent of the Company, the holders
of not less than a majority of the outstanding shares of Series A Preferred
Stock and the holders of not less than a majority of the outstanding shares of
Series B Preferred Stock, each voting separately as a class.

     Section 7.2  Legend on Securities. The Company, each of the Investors and
     -----------  --------------------
each of the Stockholders acknowledge and agree that a legend in substantially
the following form shall be typed on each certificate evidencing any of the
securities issued hereunder held at any time by an Investor or a Stockholder:

     THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 (THE "ACT"), OR ANY STATE SECURITIES OR BLUE SKY LAWS AND
MAY NOT BE OFFERED, SOLD, TRANSFERRED, HYPOTHECATED OR OTHERWISE ASSIGNED EXCEPT
(1) PURSUANT TO A REGISTRATION STATEMENT WITH RESPECT TO SUCH SECURITIES WHICH
IS EFFECTIVE UNDER THE ACT OR (2) PURSUANT TO AN AVAILABLE EXEMPTION FROM
REGISTRATION UNDER THE ACT RELATING TO THE DISPOSITION OF SECURITIES AND (3) IN
ACCORDANCE WITH APPLICABLE STATE SECURITIES AND BLUE SKY LAWS.

     THE SECURITIES REPRESENTED HEREBY ARE SUBJECT TO THE PROVISIONS OF A
STOCKHOLDERS AND RIGHTS AGREEMENT DATED AS OF JULY 9, 1999,

                                       21
<PAGE>

INCLUDING THEREIN CERTAIN RESTRICTIONS ON TRANSFER. A COMPLETE AND CORRECT COPY
OF THIS AGREEMENT IS AVAILABLE FOR INSPECTION AT THE PRINCIPAL OFFICE OF THE
COMPANY AND WILL BE FURNISHED UPON WRITTEN REQUEST AND WITHOUT CHARGE.

     Section 7.3  Governing Law. This Agreement shall be deemed to be a contract
     -----------  -------------
made under, and shall be construed in accordance with, the laws of The State of
Delaware, without giving effect to conflict of laws principles thereof.

     Section 7.4  Section Headings. The descriptive headings in this Agreement
     -----------  ----------------
have been inserted for convenience only and shall not be deemed to limit or
otherwise affect the construction of any provision thereof or hereof.

     Section 7.5  Counterparts. This Agreement may be executed simultaneously in
     -----------  ------------
any number of counterparts, each of which when so executed and delivered shall
be taken to be an original; but such counterparts shall together constitute but
one and the same document. This Agreement may be executed and delivered by
exchange of facsimile copies showing the signatures of the parties hereto, and
those signatures need not be affixed to the same copy. The facsimile copies
showing the signatures of the parties will constitute originally signed copies
of the same agreement requiring no further execution.

     Section 7.6  Notices and Demands. Any notice or demand which is required or
     -----------  -------------------
provided to be given under this Agreement shall be deemed to have been
sufficiently given and received for all purposes when delivered by hand,
telecopy, telex or other method of facsimile, or five days after being sent by
certified or registered mail, postage and charges prepaid, return receipt
requested, or two days after being sent by overnight delivery providing receipt
of delivery, to the following addresses: if to the Company or the Founder, at
the addresses set forth on the signature pages hereto, or at any other address
designated by the Company or the Founder, respectively, to the Investors and the
other parties hereto in writing; if to the Investors, at the address set forth
on the signature pages hereto or at any other address designated by an Investor
to the Company in writing; and if to any other Stockholder, at the mailing
address for notice as set forth in the books and records of the Company.

     Section 7.7  Dispute Resolution.
     -----------  ------------------

          (a)  All disputes, claims, or controversies arising out of or relating
to this Agreement or any other agreement executed and delivered pursuant to this
Agreement or the negotiation, validity or performance hereof and thereof or the
transactions contemplated hereby and thereby that are not resolved by mutual
agreement shall be resolved solely and exclusively by binding arbitration to be
conducted in accordance with this Section 7.7. The arbitration shall be held in
New York, New York before a single arbitrator (who shall possess experience in
corporate transaction litigation) and shall be conducted in accordance with the
rules and regulations for large complex litigation promulgated by but not under
the auspices of the American Arbitration Association (the "AAA"), unless
specifically modified herein.

     The parties covenant and agree that the arbitration shall commence within
one hundred eighty (180) days of the date on which a written demand for
arbitration is filed by any party

                                      22
<PAGE>

hereto. In connection with the arbitration proceeding, the arbitrator shall have
the power to order the production of documents by each party and any third-party
witnesses. In addition, each party may take up to three depositions as of right,
and the arbitrator may in his or her discretion allow additional depositions
upon good cause shown by the moving party. However, the arbitrator shall not
have the power to order the answering of interrogatories or the response to
requests for admission. In connection with any arbitration, each party shall
provide to the other, no later than seven (7) business days before the date of
the arbitration, the identity of all persons that may testify at the arbitration
and a copy of all documents that may be introduced at the arbitration or
considered or used by a party's witness or expert. The arbitrator's decision and
award shall be made and delivered as soon as possible, but in no event later
than six (6) months of the selection of the arbitrator. The arbitrator's
decision shall set forth a reasoned basis for any award of damages or finding of
liability. The arbitrator shall not have power to award damages in excess of
actual compensatory damages and shall not multiply actual damages or award
punitive damages or any other damages that are specifically excluded under this
Agreement, and each party hereby irrevocably waives any claim to such damages.

     The parties covenant and agree that they will participate in the
arbitration in good faith and that they will share equally its costs, except as
otherwise provided herein.  The arbitrator may in his or her discretion assess
costs and expenses (including the reasonable legal fees and expenses of the
prevailing party) against any party to a proceeding.  Any party unsuccessfully
refusing to comply with an order of the arbitrators shall be liable for costs
and expenses, including attorneys' fees, incurred by the other party in
enforcing the award.  This Section 7.7 applies equally to requests for
temporary, preliminary or permanent injunctive relief, except that in the case
of temporary or preliminary injunctive relief any party may proceed in court
without prior arbitration for the limited purpose of avoiding immediate and
irreparable harm.  The provisions of this Section 7.7 shall be enforceable in
any court of competent jurisdiction.

     The parties shall bear their own attorneys' fees, costs and expenses in
connection with the arbitration.  The parties will share equally in the fees and
expenses charged by the arbitrator.

          (b) Each of the parties hereto irrevocably and unconditionally
consents to the provisions of this Section 7.7 to resolve all disputes, claims
or controversies arising out of or relating to this Agreement or any other
agreement executed and delivered pursuant to this Agreement or the negotiation,
validity or performance hereof and thereof or the transactions contemplated
hereby and thereby and further consents to the jurisdiction of the courts of the
State of New York for the purposes of enforcing the arbitration provisions of
Section 7.7(a) hereof. Each party further irrevocably waives any objection to
proceeding in the manner set forth in this Section 7.7 based upon lack of
personal jurisdiction or to the laying of venue and further irrevocably and
unconditionally waives and agrees not to make a claim in any court that
arbitration conducted in accordance with this Section 7.7 has been brought in an
inconvenient forum. Each of the parties hereto hereby consents to service of
process by registered mail at the address to which notices are to be given. Each
of the parties hereto agrees that its or his submission to jurisdiction and its
or his consent to service of process by mail is made for the express benefit of
the other parties hereto.

     Section 7.8  Remedies; Severability. Notwithstanding Section 7.7 hereof, is
     -----------  ----------------------
specifically understood and agreed that any breach of the provisions of this
Agreement by any

                                      23
<PAGE>

Person subject hereto may result in irreparable injury to the other parties
hereto, that the remedy at law alone may be an inadequate remedy for such
breach, and that, in addition to any other remedies which they may have, such
other parties may enforce their respective rights by actions for specific
performance (to the extent permitted by law). The Company may refuse to
recognize any unauthorized transferee as one of its stockholders for any
purpose, including, without limitation, for purposes of dividend and voting
rights, until the relevant party or parties have complied with all applicable
provisions of this Agreement. Whenever possible, each provision of this
Agreement shall be interpreted in such a manner as to be effective and valid
under applicable law, but if any provision of this Agreement shall be deemed
prohibited or invalid under such applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity, and such
prohibition or invalidity shall not invali date the remainder of such provision
or the other provisions of this Agreement.

     Section 7.9  Integration. This Agreement, including the exhibits, documents
     -----------  -----------
and instruments referred to herein, constitutes the entire agreement, and
supersedes all other prior agreements and understandings, both written and oral,
among the parties with respect to the subject matter hereof, including, without
limitation, the letter of intent between the Company and the Series A Investors,
dated May 6, 1999 and the letter of intent dated June 16, 1999 between the
Company and the Series B Investor. The Company and the Management Stockholder
agree that Article IV of this Agreement shall constitute the entire agreement,
and supercede all other prior agreements and understandings, both written and
oral, with respect to the subject matter thereof, including the Employment
Agreement dated as of June 1, 1999 between the Company and the Management
Stockholder.

     Section 7.10  Adjustment. All references to share amounts and prices herein
     ------------  ----------
shall be equitably adjusted to reflect any stock split, combination,
reorganization, recapitalization, reclassification, stock distribution, stock
dividend or similar event affecting the capital stock of the Company.

     Section 7.11  Term. The provisions contained in Articles II, III and VI
     ------------  ----
will remain in effect only until the closing by the Company of a Qualified
Public Offering. The remaining provisions will survive after a Qualified Public
Offering.

                           [SIGNATURE PAGE FOLLOWS]

                                      24
<PAGE>

     IN WITNESS WHEREOF, the parties have executed this Amended and Restated
Stockholders and Rights Agreement as of the date first above written.

                                    COMPANY:

                                         CLICK INTERACTIVE, INC.

                                    By:  /s/ Michael W. Ferro
                                       ------------------------------------
                                         Michael W. Ferro, Jr., President

                                         Address:
                                         919 North Michigan Avenue
                                         Chicago, Illinois  60611
<PAGE>

     IN WITNESS WHEREOF, the parties have executed this Amended and Restated
Stockholders and Rights Agreement as of the date first above written.

                                    FOUNDER:

                                    By:  /s/ Michael W. Ferro
                                         ----------------------------------
                                         Michael W. Ferro, Jr., President

                                         Address:
                                         2816 Osprey Cove Place, #101
                                         Kissimee, FL  34746
<PAGE>

     IN WITNESS WHEREOF, the parties have executed this Amended and Restated
Stockholders and Rights Agreement as of the date first above written.

                                         SERIES A INVESTORS:
                                         ------------------

                                         INSIGHT CAPITAL PARTNERS III, L.P.

                                         By: Insight Venture Associates III,
                                             L.L.C., its general partner

                                         By:  /s/ Jerry Murdock
                                            -----------------------------
                                            Name: Jerry Murdock
                                            Title: Partner

                                         INSIGHT CAPITAL PARTNERS III
                                         --COINVESTORS, L.P.

                                         By: Insight Venture Associates III,
                                             L.L.C., its general partner

                                         By:  /s/ Jerry Murdock
                                            -----------------------------
                                            Name: Jerry Murdock
                                            Title: Partner

                                         INSIGHT CAPITAL PARTNERS
                                         (CAYMAN) III, L.P.

                                         By: Insight Venture Associates III,
                                             L.L.C., its general partner

                                         By:  /s/ Jerry Murdock
                                            -----------------------------
                                            Name: Jerry Murdock
                                            Title: Partner

                                         Address for Investors:
                                            c/o Insight Capital Partners
                                            122 East 42nd Street, Suite 2400
                                            New York, New York 10168
<PAGE>

     IN WITNESS WHEREOF, the parties have executed this Amended and Restated
Stockholders and Rights Agreement as of the date first above written.

                                         SERIES B INVESTOR:
                                         -----------------

                                    COMPAQ COMPUTER CORPORATION

                                    By:  /s/ Stephen Mahoney
                                         -----------------------------
                                         Address:  40 Old Bolton Road
                                                   Stow, Massachusetts  01775
<PAGE>

     IN WITNESS WHEREOF, the parties have executed this Amended and Restated
Stockholders and Rights Agreement as of the date first above written.

                                    MANAGEMENT STOCKHOLDER:

                                    By:  /s/ Robert J. Markese
                                         ---------------------------------
                                         Robert J. Markese
                                         155 North Montclair Avenue
                                         Glen Ellyn, IL  60137
<PAGE>

                                   EXHIBIT A

                     Form of Stockholder Joinder Agreement
                     -------------------------------------

     The undersigned hereby agrees, effective as of the date hereof, to become a
party to that certain Amended and restated Stockholders and Rights Agreement
(the "Agreement") dated as of July ___, 1999 by and among Click Interactive,
Inc. (the "Company") and the other parties named therein and for all purposes of
the Agreement, the undersigned shall be included within the term Stockholder
(each as defined in the Agreement),  The address and facsimile number to which
notices may be sent to the undersigned is as follows:

________________________________________________________________________________

Facsimile No._________________.

                                        ________________________________________
                                        [NAME OF UNDERSIGNED]
<PAGE>

     IN WITNESS WHEREOF, the parties have executed this Amended and Restated
Stockholders and Rights Agreement as of the date first above written.

                                         SERIES A INVESTORS:
                                         ------------------

                                         INSIGHT CAPITAL PARTNERS III, L.P.

                                         By: Insight Venture Associates III,
                                             L.L.C., its general partner

                                         By:  /s/ Jerry Murdock
                                            -----------------------------
                                            Name: Jerry Murdock
                                            Title: Partner

                                         INSIGHT CAPITAL PARTNERS III
                                         --COINVESTORS, L.P.

                                         By: Insight Venture Associates III,
                                             L.L.C., its general partner

                                         By:  /s/ Jerry Murdock
                                            -----------------------------
                                            Name: Jerry Murdock
                                            Title: Partner

                                         INSIGHT CAPITAL PARTNERS
                                         (CAYMAN) III, L.P.

                                         By: Insight Venture Associates III,
                                             L.L.C., its general partner

                                         By:  /s/ Jerry Murdock
                                            -----------------------------
                                            Name: Jerry Murdock
                                            Title: Partner

                                         Address for Investors:
                                            c/o Insight Capital Partners
                                            122 East 42nd Street, Suite 2400
                                            New York, New York 10168

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