Document:

EXHIBIT 4.2

                             ABLEAUCTIONS.COM, Inc.

                             1999 STOCK OPTION PLAN

     This 1999 Stock Option Plan (the "Plan")  provides for the grant of options
to acquire shares of common stock with a par value of $0.001 (collectively,  the
"Common  Stock")  of   Ableauctions.com,   Inc.  (the   "Company"),   a  Florida
corporation. Stock options granted under the Plan that qualify under Section 422
of the Internal  Revenue Code of 1986, as amended (the "Code"),  are referred to
in the Plan as  "Incentive  Stock  Options."  Incentive  Stock Options and stock
options that do not qualify under Section 422 of the Code ("Non-Qualified  Stock
Options") granted under the Plan are referred to collectively as "Options."

1. PURPOSES

     The purposes of the Plan are:

(a)  to retain the  services  of valued key  employees  and  consultants  of the
     Company and other persons selected by the Plan  Administrator in accordance
     with Section 3 below;

(b)  to encourage those persons to acquire a greater proprietary interest in the
     Company, thereby strengthening their incentive to achieve the objectives of
     the  Company's  shareholders  and to serve as an aid and  inducement in the
     hiring of new employees; and

(c)  to provide an equity incentive to consultants and other persons selected by
     the Plan Administrator.

2. ADMINISTRATION

     The Plan will be administered initially by the Company's Board of Directors
(the  "Board"),  except  that the Board  may,  in its  discretion,  establish  a
committee (the "Committee")  composed of two or more members of the Board or two
or more other persons to administer the Plan. The Committee may be an executive,
compensation,  or other  committee,  including a separate  committee  especially
created for this purpose,  and will have the powers and authority  vested in the
Board hereunder (including the power and authority to interpret any provision of
the Plan or of any  Option).  The  members  of any  Committee  will serve at the
pleasure  of the  Board.  A  majority  of the  members  of  the  Committee  will
constitute  a  quorum,  and all  actions  of the  Committee  must be  taken by a
majority of the members present. Any action may be taken by a written instrument
signed by all of the  members of the  Committee  and any action so taken will be
fully  effective  as if it had  been  taken  at a  meeting.  The  Board  or,  if
applicable, the Committee is referred to herein as the "Plan Administrator."

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     The Plan will be administered by the Board or by the Committee  which,  for
the  purposes  hereof,  will be composed of two or more members of the Board who
are  "Non-Employee  Directors" (as defined  below) and, as  applicable,  outside
directors.  The term  "outside  director"  will have the meaning  assigned to it
under  Section  162(m)  of the  Code (as  amended  from  time to  time)  and the
regulations  (or any successor  regulations)  promulgated  thereunder  ("Section
162(m) of the Code").  The term  "Non-Employee  Director"  will have the meaning
assigned to it under Rule 16b-3 (as amended from time to time) promulgated under
the  Securities  Exchange Act of 1934,  as amended (the  "Exchange  Act") or any
successor rule or regulatory requirement.

     Subject to the  provisions  of the Plan,  and with a view to effecting  its
purpose,  the Plan  Administrator  will  have  sole  authority  in its  absolute
discretion to:

(a)  construe and interpret the Plan;

(b)  define the terms used in the Plan;

(c)  prescribe,  amend,  and rescind the rules and  regulations  relating to the
     Plan;

(d)  correct any defect,  supply any omission, or reconcile any inconsistency in
     the Plan;

(e)  grant Options under the Plan;

(f)  determine  the  individuals  to whom Options will be granted under the Plan
     and  whether the Option is an  Incentive  Stock  Option or a  Non-Qualified
     Stock Option;

(g)  determine  the time or times at which  Options  will be  granted  under the
     Plan;

(h)  determine the number of shares of Common Stock subject to each Option,  the
     exercise price of each Option, the duration of each Option and the times at
     which each Option will become exercisable;

(i)  determine all other terms and conditions of the Options; and

(j)  make all other  determinations and interpretations  necessary and advisable
     for the  administration  of the Plan.  All  decisions,  determinations  and
     interpretations  made  by  the  Plan  Administrator  will  be  binding  and
     conclusive   on  all   participants   in  the  Plan  and  on  their   legal
     representatives, heirs, and beneficiaries.

     The Board or, if  applicable,  the  Committee  may  delegate to one or more
executive  officers of the Company the authority to grant Options under the Plan
to  employees  of the  Company  who, on the Date of Grant (as defined in Section
5(b) of the  Plan),  are not  subject to  Section  16 of the  Exchange  Act with
respect to the Common Stock ("Non-Insiders"), and are not "covered employees" as
that term is defined for  purposes of Section  162(m) of the Code  ("Non-Covered
Employees"),  and in connection  therewith  the authority to determine:  (1) the
number of

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shares of Common Stock subject to those Options; (2) the duration of the Option;
(3) the  vesting  schedule  for  determining  the times at which the Option will
become exercisable; and (4) all other terms and conditions of those Options. The
exercise  price for any  Option  granted  by action of an  executive  officer or
officers  pursuant to a delegation  of authority  will not be less than the fair
market  value  per  share  of the  Common  Stock on the  Date of  Grant.  Unless
expressly  approved in advance by the Board or the  Committee,  a delegation  of
authority  will not include the  authority  to  accelerate  vesting,  extend the
period for exercise,  or otherwise alter the terms of outstanding  Options.  The
term "Plan  Administrator"  when used in any  provision  of this Plan other than
Sections  2,  5(f),  5(m),  and 11 will be  deemed  to refer to the Board or the
Committee,  as the case may be, and an executive officer who has been authorized
to grant Options pursuant thereto, insofar as these provisions may be applied to
persons that are Non-Insiders  and Non-Covered  Employees and Options granted to
those persons.

3.   ELIGIBILITY

     Incentive  Stock Options may be granted to any individual  who, at the time
the Option is granted,  is an employee of the Company or any Related Corporation
(as defined below) ("Employees").  Non-Qualified Stock Options may be granted to
Employees and to any other persons  (other than directors who are not Employees)
that  are  selected  by  the  Plan  Administrator.  Options  may be  granted  in
substitution for outstanding  Options of another  corporation in connection with
the  merger,   consolidation,   acquisition  of  property  or  stock,  or  other
reorganization  between that other corporation and the Company or any subsidiary
of the Company. Options also may be granted in exchange for outstanding Options.
Any person to whom an Option is granted  under  this Plan is  referred  to as an
"Optionee."  Any  person  who is the  owner of an  Option  is  referred  to as a
"Holder."

     As used in  this  Plan,  the  term  "Related  Corporation"  will  mean  any
corporation  (other  than the  Company)  that is a "Parent  Corporation"  of the
Company or "Subsidiary  Corporation" of the Company,  as those terms are defined
in  Sections  424(e) and  424(f),  respectively,  of the Code (or any  successor
provisions) and the regulations thereunder (as amended from time to time).

4.   STOCK

     The Plan  Administrator  is  authorized to grant Options to acquire up to a
total  of  3,000,000  shares  of  the  Company's  authorized  but  unissued,  or
reacquired, Common Stock. The number of shares with respect to which Options may
be  granted  hereunder  is subject to  adjustment  as set forth in Section  5(m)
hereof. If any outstanding  Option expires or is terminated for any reason,  the
shares of Common Stock allocable to the  unexercised  portion of that Option may
again be subject to an Option  granted to the same  Optionee  or to a  different
person  eligible  under  Section  3 of this  Plan;  provided  however,  that any
canceled  Options  will be counted  against  the  maximum  number of shares with
respect to which Options may be granted to any particular person as set forth in
Section 3 hereof.

<PAGE>

5.   TERMS AND CONDITIONS OF OPTIONS

     Each  Option  granted  under  this  Plan  will be  evidenced  by a  written
agreement approved by the Plan  Administrator (the "Agreement").  Agreements may
contain provisions, not inconsistent with this Plan, that the Plan Administrator
in its  discretion  deems  advisable.  All  Options  also will  comply  with the
following requirements:

(a)  Number of Shares and Type of Option

     Each  Agreement will state the number of shares of Common Stock to which it
pertains and whether the Option is intended to be an Incentive Stock Option or a
Non-Qualified Stock Option. In the absence of action to the contrary by the Plan
Administrator  in  connection  with the grant of an Option,  all Options will be
Non-Qualified Stock Options.  The aggregate fair market value (determined at the
Date of Grant,  as defined  below) of the stock with respect to which  Incentive
Stock  Options are  exercisable  for the first time by the  Optionee  during any
calendar  year  (granted  under this Plan and all other  Incentive  Stock Option
plans of the Company, a Related Corporation,  or a predecessor corporation) will
not exceed  $100,000 or any other limit that may be  prescribed  by the Code, as
amended  from time to time.  Any  portion of an Option  that  exceeds the annual
limit will not be void but rather will be a Non-Qualified Stock Option.

(b)  Date of Grant

     Each Agreement will state the date the Plan  Administrator has deemed to be
the  effective  date of the Option for the  purposes  of this Plan (the "Date of
Grant").

(c)  Option Price

     Each  Agreement  will state the price per share of Common Stock at which it
is exercisable.  The exercise price will be fixed by the Plan  Administrator  at
whatever  price the Plan  Administrator  determines  in the exercise of its sole
discretion;  provided that the per share exercise  price for an Incentive  Stock
Option or any Option  granted to a "covered  employee",  as that term is defined
for the purposes of Section 162(m) of the Code ("Covered Employee"), will not be
less than the fair  market  value per share of the  Common  Stock at the Date of
Grant as determined by the Plan  Administrator  in good faith;  provided further
that with respect to Incentive Stock Options granted to greater-than-ten percent
(> 10%)  shareholders  of the Company (as  determined  with reference to Section
424(d) of the Code),  the exercise price per share will not be less than 110% of
the fair  market  value  per share of the  Common  Stock at the Date of Grant as
determined by the Plan  Administrator in good faith;  and, provided further that
Options granted in substitution for outstanding  options of another  corporation
in connection with the merger, consolidation,  acquisition of property or stock,
or other reorganization  involving that other corporation and the Company or any
subsidiary  of the  Company may be granted  with an exercise  price equal to the
exercise price for the substituted option of the other  corporation,  subject to
any adjustment  consistent with the terms of the  transaction  pursuant to which
the substitution is to occur.

<PAGE>

(d)  Duration of Options

     At the  time of the  grant  of the  Option,  the  Plan  Administrator  will
designate, subject to paragraph 5(g) below, the expiry date of the Option, which
date  will  not be  later  than 10  years  from the Date of Grant in the case of
Incentive  Stock Options;  provided that the expiry date of any Incentive  Stock
Option granted to a greater-than-ten  percent (> 10%) shareholder of the Company
(as  determined  with reference to Section 424(d) of the Code) will not be later
than five years from the Date of Grant. In the absence of action to the contrary
by the Plan  Administrator  in connection with the grant of a particular  Option
and except in the case of  Incentive  Stock  Options  as  described  above,  all
Options  granted  under  this  Section 5 will  expire 10 years  from the Date of
Grant.

(e)  Vesting Schedule

     No Option will be exercisable until it has vested. The vesting schedule for
each Option will be specified by the Plan  Administrator at the time of grant of
the Option  before the provision of services with respect to which the Option is
granted; provided that if no vesting schedule is specified at the time of grant,
the Option will vest according to the following schedule:

                 Number of Months                 Percentage of Total
              Following Date of Grant                 Option Vested
            ---------------------------        ---------------------------
                       3                                 12.5%
                       6                                 25%
                       9                                 37.5%
                      12                                 50%
                      15                                 62.5%
                      18                                 75%
                      21                                 87.5%
                      24                                100%

     The Plan  Administrator  may  specify  a  vesting  schedule  for all or any
portion  of an  Option  based  on  the  achievement  of  performance  objectives
established in advance of the Optionee's commencement of services related to the
achievement  of the  performance  objectives.  Performance  objectives  will  be
expressed in terms of one or more of the following:  return on equity, return on
assets,  share  price,  market  share,  sales,  earnings per share,  costs,  net
earnings, net worth, inventories, cash and cash equivalents, and gross margin or
the Company's  performance  relative to its internal business plan.  Performance
objectives  may be in  respect  of the  performance  of the  Company  as a whole
(whether on a consolidated or unconsolidated basis), a Related Corporation, or a
subdivision, operating unit, product or product line of either of the foregoing.
Performance objectives may be absolute or relative and may be expressed in terms
of a progression or a range.  An Option that is exercisable (in full or in part)
on the achievement of one or more  performance  objectives may be exercised only
following written notice to the

<PAGE>

Optionee  and  the  Company  by the  Plan  Administrator  that  the  performance
objective has been achieved.

(f)  Acceleration of Vesting

     The vesting of one or more  outstanding  Options may be  accelerated by the
Plan Administrator at the times and in the amounts that it will determine in its
sole discretion.

(g)  Term of Option

     Vested Options will terminate,  to the extent not previously exercised,  on
the occurrence of the first of the following events:

     (1)  the expiry of the Option,  as designated by the Plan  Administrator in
          accordance with Section 5(d) above;

     (2)  the date of an Optionee's  termination  of  employment or  contractual
          relationship with the Company or any Related Corporation for cause (as
          determined in the sole discretion of the Plan Administrator);

     (3)  the expiry of three months from the date of an Optionee's  termination
          of  employment  or  contractual  relationship  with the Company or any
          Related Corporation for any reason whatsoever other than cause, death,
          or  Disability  (as  defined  below),   unless,   in  the  case  of  a
          Non-Qualified  Stock  Option,  the exercise  period is extended by the
          Plan Administrator  until a date not later than the expiry date of the
          Option; or

     (4)  the expiry of one year from termination of an Optionee's employment or
          contractual  relationship by reason of death or Disability (as defined
          below),  unless,  in the case of a  Non-Qualified  Stock  Option,  the
          exercise period is extended by the Plan Administrator until a date not
          later than the expiry date of the Option.

     On the death of an Optionee, any vested Options held by the Optionee may be
exercisable  only by the person or persons to whom the  Optionee's  rights under
the  Options  pass  by  the  Optionee's  will  or by the  laws  of  descent  and
distribution  of the state or county of the  Optionee's  domicile at the time of
death and only until the Options  terminate as provided above.  For the purposes
of the Plan,  unless  otherwise  defined in the  Agreement,  "Disability"  means
medically  determinable physical or mental impairment which has lasted or can be
expected to last for a continuous  period of not less than 12 months or that can
be  expected to result in death  (within the meaning of Section  22(e)(3) of the
Code). The Plan  Administrator will determine whether an Optionee has incurred a
Disability   on  the  basis  of  medical   evidence   acceptable   to  the  Plan
Administrator.  On making a determination of Disability,  the Plan Administrator
will,  for the  purposes  of the  Plan,  determine  the  date  of an  Optionee's
termination of employment or contractual relationship.

<PAGE>

     Unless accelerated in accordance with Section 5(f) above,  unvested Options
will terminate  immediately  on termination of the Optionee's  employment by the
Company  for any  reason  whatsoever,  including  death or  Disability.  For the
purposes of this Plan,  transfer of employment  between or among the Company and
any  Related  Corporation  will not be deemed to  constitute  a  termination  of
employment with the Company or any Related Corporation. For the purposes of this
subsection,  employment  will be deemed to  continue  while the  Optionee  is on
military  leave,  sick leave, or other bona fide leave of absence (as determined
by the Plan Administrator). Despite the foregoing, employment will not be deemed
to  continue  beyond  the  first  90  days  of  leave,   unless  the  Optionee's
re-employment rights are guaranteed by statute or by contract.

(h)  Exercise of Options

     Options will be exercisable,  in full or in part, at any time after vesting
until termination. If less than all of the shares included in the vested portion
of any Option are  purchased,  the remainder may be purchased at any  subsequent
time  before the expiry of the  Option  term.  No portion of any Option for less
than 100 shares (as adjusted  pursuant to Section 5(m) below) may be  exercised;
provided  that if the vested  portion of any Option is less than 100 shares,  it
may be exercised  with respect to all shares for which it is vested.  Only whole
shares may be issued  pursuant  to an Option,  and to the extent  that an Option
covers less than one share, it is unexercisable.

     Options or portions  thereof may be exercised by giving  written  notice to
the Company,  which notice must specify the number of shares to be purchased and
must be accompanied by payment in the amount of the aggregate exercise price for
the Common Stock so purchased,  which  payment must be in the form  specified in
Section  5(i) below.  The  Company  will not be obliged to issue,  transfer,  or
deliver  a  certificate  of  Common  Stock to the  Holder  of any  Option  until
provision has been made by the Holder,  to the satisfaction of the Company,  for
the payment of the aggregate  exercise price for all shares for which the Option
has been  exercised  and for  satisfaction  of any tax  withholding  obligations
associated  with the  exercise.  During  an  Optionee's  lifetime,  Options  are
exercisable  only by the  Optionee  or,  in the  case of a  Non-Qualified  Stock
Option,  a transferee  who takes title to the Option in the manner  permitted by
subsection 5(k) hereof.

(i)  Payment on Exercise of Option

     On the exercise of any Option, the aggregate exercise price will be paid to
the Company in cash or by certified or cashier's cheque. In addition, the Holder
may pay for all or any portion of the aggregate exercise price by complying with
one or more of the following alternatives:

     (1)  by delivering to the Company shares of Common Stock previously held by
          the  Holder or by the  Company  withholding  shares  of  Common  Stock
          otherwise

<PAGE>

          deliverable pursuant to exercise of the Option, which shares of Common
          Stock  received or withheld  will have a fair market value at the date
          of exercise (as  determined  by the Plan  Administrator)  equal to the
          aggregate exercise price to be paid by the Optionee on exercise;

     (2)  by  delivering  a  properly   signed  exercise  notice  together  with
          irrevocable  instructions  to a broker  promptly  to sell or  margin a
          sufficient  portion of the shares and deliver  directly to the Company
          the amount of sale or margin loan proceeds to pay the exercise  price;
          or

     (3)  by complying  with any other  payment  mechanism  approved by the Plan
          Administrator at the time of exercise.

     Despite the  foregoing,  without  the Plan  Administrator's  prior  written
consent,  a Holder will not  surrender  or attest to the  ownership of shares of
Common  Stock in payment of the  exercise  price if that action  would cause the
Company to recognize  compensation expense (or additional  compensation expense)
with respect to any option for financial reporting purposes.

(j)  Rights as a Shareholder

     A Holder will have no rights as a  shareholder  with  respect to any shares
covered by an Option  until the Holder  becomes a record  holder of the  shares,
irrespective of whether the Holder has given notice of exercise.  No rights will
accrue to a Holder  and no  adjustments  will be made on  account  of  dividends
(ordinary or extraordinary,  whether in cash, securities,  or other property) or
distributions  or other rights  declared on, or created in, the Common Stock for
which the record  date is before  the date on which the Holder  becomes a record
holder of the shares of Common  Stock  covered by the  Option,  irrespective  of
whether the Holder has given notice of exercise.

(k)  Transfer of Option

     Options granted under this Plan and the rights and privileges  conferred by
this Plan may not be  transferred,  assigned,  pledged,  or  hypothecated in any
manner  (whether  by  operation  of law or  otherwise)  other  than by will,  by
applicable  laws of  descent  and  distribution,  or  (except  in the case of an
Incentive Stock Option)  pursuant to a qualified  domestic  relations order, and
will not be subject to  execution,  attachment,  or  similar  process;  provided
however  that  any  Agreement  may  provide  or be  amended  to  provide  that a
Non-Qualified  Stock Option to which it relates is transferable  without payment
of  consideration  to immediate  family  members of the Optionee or to trusts or
partnerships  or limited  liability  companies  established  exclusively for the
benefit of the Optionee and the  Optionee's  immediate  family  members.  On any
attempt to transfer,  assign, pledge,  hypothecate,  or otherwise dispose of any
Option or of any right or  privilege  conferred  by this  Plan  contrary  to the
provisions hereof, or on the sale, levy, or any attachment or similar process on
the rights and privileges  conferred by this Plan, the Option will terminate and
become null and void.

<PAGE>

(l)  Securities Regulation and Tax Withholding

     (1)  Shares  will not be  issued  with  respect  to an  Option  unless  the
          exercise  of the Option and the  issuance  and  delivery of the shares
          complies  with  all  relevant  provisions  of law,  including  without
          limitation Section 162(m) of the Code; any applicable state securities
          laws; the Securities Act of 1933, as amended; the Exchange Act and the
          rules and regulations  thereunder;  and the  requirements of any stock
          exchange or automated  inter-dealer  quotation  system of a registered
          national  securities  association  on  which  the  shares  may then be
          listed.  The share issuance will be further subject to the approval of
          counsel for the Company  with  respect to  compliance,  including  the
          availability  of an exemption from  registration  for the issuance and
          sale of the  shares.  The  Company's  inability  to  obtain  from  any
          regulatory  body the  authority  deemed by the Company to be necessary
          for the lawful issuance and sale of any shares under this Plan, or the
          unavailability  of an exemption from registration for the issuance and
          sale of any shares  under this Plan,  will  relieve the Company of any
          liability with respect to the non-issuance or sale of the shares.

          As a condition  to the exercise of an Option,  the Plan  Administrator
          may require the Holder to represent and warrant in writing at the time
          of exercise that the shares are being  purchased  only for  investment
          and without  any  then-present  intention  to sell or  distribute  the
          shares. At the option of the Plan Administrator, a stop-transfer order
          against the shares may be placed on the stock books and records of the
          Company  and a legend  indicating  that the stock may not be  pledged,
          sold,  or  otherwise  transferred  unless an  opinion  of  counsel  is
          provided  stating  that  the  transfer  is  not  in  violation  of any
          applicable  law or  regulation  may  be  stamped  on the  certificates
          representing the shares to assure an exemption from registration.  The
          Plan Administrator also may require other  documentation that may from
          time to time be necessary to comply with federal and state  securities
          laws.

     (2)  The Holder will pay to the Company by certified  or cashier's  cheque,
          promptly on  exercise of an Option or, if later,  on the date that the
          amount  of  the  obligations  becomes  determinable,   all  applicable
          federal,  state,  local, and foreign  withholding  taxes that the Plan
          Administrator, in its discretion,  determines to result on exercise of
          an Option or from a transfer or other  disposition of shares of Common
          Stock  acquired on exercise  of an Option or  otherwise  related to an
          Option or  shares  of Common  Stock  acquired  in  connection  with an
          Option.  On the Plan  Administrator's  approval,  a Holder may satisfy
          that  obligation  by  complying  with  one or  more  of the  following
          alternatives selected by the Plan Administrator:

          (A)  by  delivering to the Company  shares of Common Stock  previously
               held by the Holder or by the Company withholding shares of Common
               Stock  otherwise  deliverable  pursuant  to the  exercise  of the
               Option,  which shares of Common Stock  received or withheld  will
               have a fair market value at the

<PAGE>

               date of exercise (as determined by the Plan Administrator)  equal
               to any  withholding  tax  obligations  arising as a result of the
               exercise, transfer, or other disposition;

          (B)  by  signing  appropriate  loan  documents  approved  by the  Plan
               Administrator  by which the Holder borrows funds from the Company
               to pay any withholding taxes due under this Paragraph 2, with any
               repayment terms selected by the Plan Administrator; or

          (C)  by complying  with any other  payment  mechanism  approved by the
               Plan Administrator from time to time.

          Despite the foregoing,  without the Plan Administrator's prior written
          consent,  a Holder will not  surrender  or attest to the  ownership of
          shares of Common Stock in payment of the exercise price if that action
          would  cause  the  Company  to  recognize   compensation  expense  (or
          additional  compensation  expense)  with  respect  to any  option  for
          financial reporting purposes.

     (3)  The issuance,  transfer,  or delivery of  certificates of Common Stock
          pursuant  to the  exercise  of  Options  may be  delayed,  at the Plan
          Administrator's discretion,  until the Plan Administrator is satisfied
          that the applicable  requirements of the federal and state  securities
          laws and the withholding provisions of the Code have been met and that
          the  Holder  has  paid or  otherwise  satisfied  any  withholding  tax
          obligation as described in (2) above.

(m)  Stock Dividend or Reorganization.

     (1)  If:

          (A)  the  Company  at  any  time  becomes  involved  in a  transaction
               described  in  Section  424(a)  of the  Code  (or  any  successor
               provision)  or  any  "corporate  transaction"  described  in  the
               regulations thereunder;

          (B)  the  Company  declares a dividend  payable in, or  subdivides  or
               combines, its Common Stock; or

          (C)  any other event with substantially the same effect occurs,

          the Plan  Administrator  will, subject to applicable law, with respect
          to each  outstanding  Option,  proportionately  adjust  the  number of
          shares of Common  Stock  subject to that  Option  and/or the  exercise
          price per share to  preserve  the rights of the  Holder  substantially
          proportionate  to the rights of the Holder  before that event,  and to
          the extent that the adjustment includes an increase or decrease in the
          number of shares of Common Stock subject to outstanding  Options,  the
          number  of  shares  available  under  Section  4  of  this  Plan  will
          automatically be

<PAGE>

          increased or decreased, as the case may be,  proportionately,  without
          further action on the part of the Plan Administrator, the Company, the
          Company's shareholders, or any Holder.

     (2)  If the  presently  authorized  capital stock of the Company is changed
          into the same number of shares  with a different  par value or without
          par value,  the stock  resulting  from the change will be deemed to be
          Common  Stock  within the  meaning of the Plan,  and each  Option will
          apply to the same  number of shares of the new stock as it  applied to
          old shares immediately before the change.

     (3)  If the Company at any time  declares an  extraordinary  dividend  with
          respect  to the  Common  Stock,  whether  payable  in  cash  or  other
          property,  the Plan  Administrator  may, subject to applicable law, in
          the  exercise  of  its  sole  discretion  and  with  respect  to  each
          outstanding  Option,  proportionately  adjust  the number of shares of
          Common Stock subject to the Option  and/or  adjust the exercise  price
          per  share  to  preserve  the  rights  of  the  Holder   substantially
          proportionate to the rights of the Holder before the event, and to the
          extent  that the  adjustment  includes  an increase or decrease in the
          number of shares of Common Stock subject to outstanding  Options,  the
          number  of  shares  available  under  Section  4  of  this  Plan  will
          automatically  be  increased  or  decreased,   as  the  case  may  be,
          proportionately,  without  further  action  on the  part  of the  Plan
          Administrator, the Company, the Company's shareholders, or any Holder.

     (4)  The  foregoing  adjustments  in the shares  subject to Options will be
          made by the Plan Administrator,  or by any successor  administrator of
          this  Plan,  or  by  the   applicable   terms  of  any  assumption  or
          substitution document.

     (5)  The grant of an Option  will not  affect in any way the right or power
          of   the    Company    to   make    adjustments,    reclassifications,
          reorganizations,  or changes of its capital or business structure;  to
          merge,  consolidate,  or dissolve; to liquidate or to sell or transfer
          all or any part of its business or assets.

6.   EFFECTIVE DATE; TERM

Incentive  Stock Options may be granted by the Plan  Administrator  from time to
time on or after the date on which this Plan is adopted (the  "Effective  Date")
through the day  immediately  preceding  the 10th  anniversary  of the Effective
Date. Non-Qualified Stock Options may be granted by the Plan Administrator on or
after the  Effective  Date and until this Plan is terminated by the Board in its
sole discretion.  Termination of this Plan will not terminate any Option granted
before   termination.   Any  Incentive   Stock  Options   granted  by  the  Plan
Administrator  before  approval of this Plan by the  Company's  shareholders  in
accordance  with Section 422 of the Code will be granted subject to ratification
of the Plan by the  shareholders of the Company within 12 months before or after
the Effective Date. Any Option granted by the Plan  Administrator to any Covered
Employee  before  approval  of  this  Plan  by  the  Company's  shareholders  in
accordance  with Section 422 of the Code will be granted subject to ratification
of

<PAGE>

this Plan by the  shareholders  of the Company  within 12 months before or after
the Effective Date. If shareholder  ratification is sought and not obtained, all
Options  granted prior thereto and thereafter  will be considered  Non-Qualified
Stock Options and any Options granted to Covered  Employees will not be eligible
for the  exclusion  set forth in Section  162(m) of the Code with respect to the
deductibility by the Company of certain compensation.

7.   NO OBLIGATIONS TO EXERCISE OPTION

The grant of an Option will not impose an obligation on the Optionee to exercise
the Option.

8.   NO RIGHT TO OPTIONS OR TO EMPLOYMENT

Whether or not any Options are to be granted under this Plan will be exclusively
within the discretion of the Plan  Administrator,  and nothing contained in this
Plan will be construed as giving any person any right to participate  under this
Plan.  The grant of an Option will in no way constitute any form of agreement or
understanding  binding on the  Company or any  Related  Corporation,  express or
implied,  that the  Company or any Related  Corporation  will employ or contract
with an Optionee  for any length of time,  nor will it interfere in any way with
the Company's or, where applicable,  a Related  Corporation's right to terminate
an Optionee's employment at any time, which right is reserved.

9.   APPLICATION OF FUNDS

The proceeds received by the Company from the sale of Common Stock issued on the
exercise  of  Options  will be  used  for  general  corporate  purposes,  unless
otherwise directed by the Board.

10.  INDEMNIFICATION OF PLAN ADMINISTRATOR

In addition to all other rights of  indemnification  they may have as members of
the Board,  members of the Plan Administrator will be indemnified by the Company
for all reasonable  expenses and  liabilities  of any type or nature,  including
attorneys' fees, incurred in connection with any action,  suit, or proceeding to
which  they or any of them are a party by  reason of or in  connection  with the
Plan or any Option  granted under the Plan, and against all amounts paid by them
in settlement  thereof  (provided that the settlement is approved by independent
legal counsel selected by the Company), except to the extent that those expenses
relate to matters for which it is adjudged that the Plan Administrator member is
liable  for  willful  misconduct;  provided,  that  within  15  days  after  the
institution of any action,  suit or proceeding,  the Plan  Administrator  member
involved  therein must, in writing,  notify the Company of the action,  suit, or
proceeding so that the Company may make appropriate arrangements to prosecute or
defend it.

11.  AMENDMENT OF PLAN

The Plan Administrator may, at any time, modify, amend, or terminate the Plan or
modify or amend Options granted under the Plan, including without limitation any
modifications  or amendments  necessary to maintain  compliance  with applicable
statutes, rules, or regulations;

<PAGE>

provided  however that no amendment with respect to an  outstanding  Option that
has the effect of reducing the benefits afforded to the Holder will be made over
the objection of the Holder;  and further  provided  that the events  triggering
acceleration  of vesting of outstanding  Options may be modified,  expanded,  or
eliminated without the consent of Holders.  The Plan Administrator may condition
the effectiveness of any amendment on the receipt of shareholder approval at the
time and in the manner that the Plan Administrator  considers  necessary for the
Company to comply with or to avail the Company and the Optionees of the benefits
of any securities,  tax, market listing,  or other  administrative or regulatory
requirement.  Without  limiting  the  generality  of  the  foregoing,  the  Plan
Administrator  may modify grants to persons who are eligible to receive  Options
under this Plan who are foreign  nationals or employed outside the United States
to recognize differences in local law, tax policy, or custom.

Effective Date:  October 14, 1999

ABLEAUCTIONS.COM, INC.
Per:

/s/ Abdul Ladha
--------------------------------
PresidentEXHIBIT 10.70

                       LICENSE AND DISTRIBUTION AGREEMENT

This License and  Distribution  Agreement (the  "Agreement") is entered into and
effective this 21st day of December, 1999 ("Effective Date"), by and between

         BIOJECT INC.
         7620 S.W. Bridgeport Rd.
         Portland, Oregon 97224
                                                                     ("Bioject")

AND:

         SERONO LABORATORIES, INC.
         100 Longwater Circle
         Norwell, MA 02061

                                                                      ("Serono")
RECITALS:

A.   Bioject designs, develops, manufactures and markets proprietary needle-free
     drug delivery injection devices and related supplies; and

B.   Serono has  developed a  proprietary  human  growth  hormone and  possesses
     certain  know-how and expertise in the marketing,  selling and distributing
     medical products and supplies, including drug delivery systems; and

C.   Bioject and Serono desire to establish a  relationship  for the license and
     distribution of the needle-free drug delivery injection devices and related
     supplies specified herein, on the terms specified herein.

AGREEMENT:

In consideration of the mutual covenants  contained  herein,  and for other good
and  valuable  consideration,  the  receipt and  sufficiency  of which is hereby
acknowledged, the parties hereto agree as follows:

1.   Grant of  License:  License  Fee;  Option.  Subject to all of the terms and
     conditions set forth in this Agreement:

     1.1  License Grant.  Bioject hereby grants to Serono an exclusive right (as
          to Bioject and all other parties) and exclusive license (as to Bioject
          and all other  parties)  under the patents  listed in Schedule 2.1 and
          related technology,  know-how and technical information (collectively,
          the "Licensed  Technology")  during the term of this Agreement to use,
          have used,  sell,  have sold,  import  and have  imported  needle-free
          devices,  syringes  and  supplies  listed  on  Schedule  1.1  of  this
          Agreement (the "Products") for use in the Field (defined below) in the
          United  States,  its  territories  and  possessions  and  Canada  (the
          "Territory").   The  term   Products   shall   include  all  upgrades,
          improvements,  modifications  and  enhancements  to the Products  made
          during the term of this Agreement. The term Products shall not include
          needle-free devices materially

<PAGE>

          different  from the existing  Products in  significant  respects.  The
          specifications  for each Product are set forth on Schedule 1.1 of this
          Agreement (the "Specifications").  The Specifications shall be amended
          from  time  to  time  by  the  parties  for  upgrades,   improvements,
          enhancements  and  other  changes  to the  Products.  New  needle-free
          devices of Bioject that do not constitute Products shall be subject to
          the right of first offer in favor of Serono set forth in Section 21 of
          this Agreement.

     1.2  Changes  to  Products.  Bioject  shall make  changes  to the  Products
          reasonably  requested  by Serono,  provided  that Serono shall pay the
          cost of  engineering  any change to Products  requested by it. Bioject
          shall  promptly  provide  Serono  with an  estimate  of such costs and
          receive  Serono's  approval of such estimate  before  undertaking  any
          change to the  Products.  Bioject  shall not make any other changes to
          the Products without Serono's prior written approval,  which shall not
          be unreasonably withheld or delayed.  Serono may withhold its approval
          in all cases where the  requested  change would impact its  regulatory
          commitments  or  approvals  with  respect to human  growth  hormone or
          delivery of human growth hormone using the Products.

     1.3  Sub-distributors.   Serono   shall   have   the   right   to   appoint
          sub-distributors to assist in the marketing,  sale and distribution of
          the  Products in the  Territory  for use in the Field,  provided  that
          Serono shall be  responsible  for ensuring that such  sub-distributors
          conduct  their  activities  with respect to the Products in compliance
          with Serono's obligations under this Agreement.

     1.4  Definition of Field. "Field" means the use of a needle-free  injection
          device and syringe to administer  human growth hormone to humans,  but
          specifically excluding treatment of AIDS-wasting.

     1.5  No Rights by  Implication.  No rights or licenses  with respect to the
          Products or the  Licensed  Technology  are  granted or deemed  granted
          hereunder  or in  connection  herewith,  other  than  those  rights or
          licenses expressly granted in this Agreement.

     1.6  Option for  Extended  Territory.  Bioject  hereby  grants to Serono an
          option to extend the  Territory to all  countries  of the world.  This
          option may be  exercised  by written  notice of exercise to Bioject at
          any time before ***.  Prior to  expiration of this option and in order
          to preserve  the benefit of this option to Serono,  Bioject  shall not
          market,  distribute  or sell or  permit  any other  person to  market,
          distribute  or sell the Products for use in the Field  anywhere in the
          world. Serono shall pay Bioject $*** for extension of the Territory to
          ***. The first $*** of such payment shall be made upon exercise of the
          option.  The remaining  $*** shall be paid *** (***) days after Serono
          and Bioject shall have secured all regulatory  approvals necessary for
          Serono to market and sell human growth  hormone for delivery  with the
          Products in Japan or all countries of the European Union. Such payment
          shall be in addition to any other amounts due

                                      -2-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.

<PAGE>

          to Bioject  under this  Agreement.  If this  option is  exercised  and
          payment is made as described in this Section 1.6,  after  exercise and
          payment the term "Territory" shall mean all countries of the world. If
          Serono for itself or one of its  Affiliates  exercises  this option to
          extend the  Territory,  the parties  will  negotiate in good faith any
          necessary  amendments to this Agreement to comply with  applicable law
          and regulatory requirements and, at the request of Serono, one or more
          separate  agreements  between  one or more  Affiliates  of Serono  and
          Bioject covering the extension  Territory which shall be substantially
          the same as this Agreement.

     1.7  Affiliates of Serono.  This Agreement shall be made for the benefit of
          Serono and its  Affiliates.  Serono may  designate  one or more of its
          Affiliates to exercise its rights, receive its benefits or perform its
          obligations  under this  Agreement in whole or in part,  provided that
          Serono shall remain responsible for all obligations  assigned by it to
          its Affiliates  under this Agreement.  For purposes of this Agreement,
          "Affiliate"  of a party shall mean any  corporation  or other business
          entity controlled by,  controlling,  or under common control with such
          party.

2.   Regulatory Matters.

     2.1  Product  Approvals in the United  States and Canada.  Bioject shall be
          responsible for obtaining and maintaining all approvals,  licenses and
          permits  necessary  for  manufacture  of the Products  and  marketing,
          selling and using the  Products to  administer  Serono's  human growth
          hormone product in the United States and Canada,  provided that Serono
          shall be responsible for all approvals that relate to its human growth
          hormone product generally. Bioject shall diligently pursue and provide
          Serono with copies of the approval of its 510K  application(s) for the
          Products and all other regulatory approvals for the Products issued by
          regulatory authorities in the United States and Canada.

     2.2  Foreign  Regulatory  Approvals.  After any  exercise  by Serono of its
          option  pursuant  to  Section  1.6  to  extend  the  Territory  to all
          countries of the world,  Bioject shall diligently  obtain and maintain
          all  approvals,   licenses  and  permits  necessary  for  the  import,
          marketing,  sale and use of  Products  to  administer  Serono's  human
          growth hormone product in all countries of the European  Union,  Japan
          and such additional  countries as designated by *** from time to time,
          provided  that Serono  shall be  responsible  for all  approvals  that
          relate to its human growth hormone product generally.

     2.3  Regulatory  Assistance  by Serono.  Serono  will use all  commercially
          reasonable  efforts to assist Bioject in obtaining and maintaining all
          necessary regulatory approvals with respect to marketing, sale and use
          of the Products to administer  Serono's human growth hormone  products
          in the Territory.

     2.4  Regulatory  Approvals for Serono's Human Growth Hormone.  Serono shall
          be responsible for obtaining and maintaining all necessary

                                      -3-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.
<PAGE>

          regulatory approvals for the manufacture,  market, sale and use of its
          human growth hormone product,  including by means of delivery with the
          Products,  in the United States and Canada and, if the option pursuant
          to Section 1.6 is exercised,  in Japan,  all countries of the European
          Union and all other  countries in which Serono  requests  that Bioject
          pursue regulatory approval for the Products.

     2.5  Regulatory  Assistance by Bioject.  Bioject will use all  commercially
          reasonable  efforts to assist Serono in obtaining and  maintaining all
          necessary regulatory approvals with respect to marketing, sale and use
          of human growth  hormone with the Products in the  Territory.  Without
          limiting  the  foregoing,  Bioject  will  provide  Serono  with  (a) a
          reasonable quantity of Products (but not less than ***) for use in any
          required clinical trials at no charge (other than shipping costs), and
          (b)  reasonable  access at no charge to Bioject's  (i) records,  study
          results,  research and other information and materials relating to the
          Products and (ii) personnel for consultation. Bioject will also assist
          Serono  in the  completion  of all  initial  and  periodic  regulatory
          filings  relating to  marketing,  sale or use of human growth  hormone
          with the Products and make its  facilities  and records  available for
          inspection by the United States Food and Drug  Administration  ("FDA")
          and international regulatory agencies.

     2.6  Facility Inspections. Serono shall, upon reasonable notice to Bioject,
          have the right to inspect the  facilities  in which the  Products  are
          manufactured,  tested or stored  at any time  during  the term of this
          Agreement  and to observe the  manufacture  of the  Products.  Bioject
          shall  consult  with Serono  prior to any response to the FDA or other
          regulatory  authority relating to the Products,  this Agreement or the
          manufacture  of the Products.  Bioject will promptly  notify Serono of
          any  FDA or  other  regulatory  inspection  related  to the  Products.
          Bioject  will  promptly  notify  Serono  of the  results  of any  such
          inspection  and furnish  Serono with a written  description of actions
          taken, if any, to remedy conditions cited in any such inspection.

     2.7  Adverse  Reactions  and  Reports.  Bioject  will  be  responsible  for
          completion  and  submission  to the FDA of any form with respect to an
          adverse  reaction or event  involving a Product sold  hereunder or any
          complaint that would require a field alert and all periodic and annual
          reports, as and when appropriate, unless Serono is under any statutory
          or  regulatory  obligation  to make such or similar  report or filing.
          Each party will forward to the other, simultaneously with filing such,
          a copy of each completed  form with respect to an adverse  reaction or
          event or  similar  report or filing  with  respect  to a Product  sold
          hereunder.

3.   Appointment  as Exclusive  Distributor.  Subject to the  provisions of this
     Agreement, Bioject hereby grants Serono the exclusive right to market, sell
     and distribute the Products in the Field within the Territory  directly and
     indirectly,  including through  wholesalers and  sub-distributors.  Bioject
     agrees that,

                                      -4-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.
<PAGE>

     during the term of this Agreement,  it will not market,  distribute or sell
     or permit any other  person to market,  sell or resell the Products for use
     in the Field in the Territory  and that Bioject will take all  commercially
     reasonable actions to give full effect to the intention of this Section.

4.   Purchase of Products by Serono.

     4.1  Purchase and Sale.  Subject to Section 4.2, Bioject agrees to sell the
          Products to Serono in  accordance  with purchase  orders  submitted by
          Serono,  and Serono  agrees to  purchase  the  Products  from  Bioject
          subject to the provisions of this Agreement.

     4.2  Forecasts; Orders. On or before the *** (***) day of the months of ***
          during the term of this Agreement,  Serono will provide Bioject with a
          written  good-faith,  non-binding  *** (***)  calendar  month  rolling
          forecast of the *** that  Serono  expects to *** of the next *** (***)
          calendar  months.  The first *** (***) calendar months of each rolling
          forecast  shall be binding.  Serono  will  provide  Bioject  with firm
          purchase  orders from time to time setting  forth the  quantities  and
          forms of Products  ordered and  required  delivery  dates (a "Purchase
          Order").  The  quantities  ordered in Purchase  Orders will be no more
          than *** (***) of the amount  covered in  Serono's  binding  forecast.
          Bioject will use its reasonable  commercial efforts to supply Products
          in excess of such amount.  Subject to the  provisions  of this Section
          with respect to orders in excess of *** of Serono's forecast,  Bioject
          shall meet fully the  requirements  of each  Purchase  Order placed by
          Serono  hereunder.  To the degree  that  either or both of the parties
          find it convenient to employ their standard forms of purchase order or
          acknowledgment  of order in administering the terms of this Agreement,
          it or they may do so but none of the terms and  conditions  printed or
          otherwise  appearing on such forms shall be  applicable  except to the
          extent that it specifies information,  such as quantities and delivery
          dates,   required  to  be  furnished   by  either   party   hereunder.
          Notwithstanding  the  foregoing  or anything in this  Agreement to the
          contrary, the parties agree that Serono shall submit its first rolling
          forecast after  approval by the FDA of Bioject's  510K  application(s)
          for the Products and that Bioject shall have a period of up to 90 days
          to fill the  first  order  for  Products  submitted  by  Serono  after
          approval by the FDA of Bioject's 510K application(s) for the Products.

          The terms and  conditions  set  forth in this  Agreement  shall be the
          exclusive  contract terms between the parties with respect to Serono's
          purchase of the Products.

     4.3  Return.  Serono  may not  return  any  Products  ordered by it without
          Bioject's express written consent.  Such consent shall not be withheld
          for return of  defective  Products or Products  being  returned  under
          Warranty  provisions  set forth in Section 12 (each,  a  "Pre-approved
          Return").  Provision by Bioject of a return goods authorization number
          ("RGA#") to Serono shall constitute express written consent to return

                                      -5-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.
<PAGE>

          Products but only for the Products and in the quantities and serial or
          lot numbers specified by such RGA#.  Except for Pre-approved  Returns,
          Products  returned  for  credit are  subject  to a minimum  restocking
          charge of 20% of the original purchase price.  Except for Pre-approved
          Returns,  used,  opened or customer  damaged products are not eligible
          for credit.

     4.4  Not a Requirements Contract.  Serono has no obligation to purchase all
          of its requirements of needle-free drug delivery  injection devices or
          related supplies from Bioject. Without limiting the foregoing,  Serono
          may qualify  other  sources of supply for  needle-free  drug  delivery
          injection  devices and related  supplies,  purchase  such  devices and
          related  supplies from others and/or  produce such devices and related
          supplies for itself.

5.   License Fees and Quotas.  Serono  agrees to pay to Bioject the license fees
     set forth in  Schedule  5.  Serono  agrees to  purchase  from  Bioject  the
     quantities  of  Product  described  in  Schedule  5 in  order  to  maintain
     exclusivity for the Territory.  If Serono *** at the ***, Serono may *** by
     making *** to Bioject in accordance with the ***.

6.   Prices and Discounts.

     6.1  Prices. Serono shall purchase Products F.O.B. Bioject's factory at the
          prices set forth in Schedule  6.1, plus any  applicable  insurance and
          taxes.  Bioject shall ship and insure Products with transportation and
          insurance  carriers  selected  by  Serono.  Freight  costs,  handling,
          insurance,  sales or  other  taxes  and  export  or  import  fees,  as
          applicable,  will be prepaid by Bioject and added to the invoice to be
          paid by Serono.  Bioject's *** at the option of Bioject upon *** (***)
          days'  written  notice to Serono but not before the *** of the date of
          this  Agreement  or more often than *** in any *** (***) month  period
          thereafter. Any price increase shall not exceed ***.

     6.2  Most Favored Customer. The prices for Products charged to Serono under
          this Agreement shall at all times be equal to or lower than the prices
          for similar  products  charged to any other  customer who  purchases a
          similar or lesser volume of Products from Bioject  taking into account
          any price concessions reasonably resulting from such other purchaser's
          payment  of a  higher  license  fee  to  Bioject,  including,  without
          limitation,  any wholesaler or distributor.  If Bioject shall enter in
          arrangements with any other customer who purchases a similar or lesser
          volume of Products  from Bioject  providing  for a lower price for any
          similar products taking into account any price concessions  reasonably
          resulting from such other purchaser's  payment of a higher license fee
          to Bioject,  then this Agreement  shall thereupon be deemed amended to
          provide  the same price to Serono,  and notice  thereof and any credit
          due shall promptly be given to Serono by Bioject.  All other terms and
          conditions  of sale to  Serono,  including  warranty  provisions  with
          respect to the  Products,  shall at all times be at least as favorable
          to Serono as those terms offered to any other customer with respect to
          similar  products,  including any  wholesaler or  distributor.  In the
          event of any shortages or capacity  limitations,  Bioject shall supply
          Products  to Serono to the best of its ability and shall not favor any
          other customer over Serono.

     6.3  Customer Prices and Terms.  Serono shall be solely responsible for the
          prices  and other  terms  and  conditions  upon  which it  resells  or
          otherwise

                                      -6-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.
<PAGE>

          disposes of the Products,  and Serono hereby acknowledges that Bioject
          has no control  whatsoever with respect to such resale prices or other
          terms and  conditions  of resale  but  Bioject  reserves  the right to
          advertise its list prices for similar products from time to time.

7.   Payment for Products.

     7.1  Product  Purchase  Price.  The full  price of all  Products  including
          applicable  shipping,  insurance  and taxes along with payment for any
          other items for which Serono owes payment to Bioject  shall be paid in
          U.S. Dollars no later than 45 days after Serono's receipt of Bioject's
          invoice or on such other terms  agreed to in writing by the parties in
          advance of the obligation  for such payments.  Bioject shall not issue
          any invoice  prior to  performing  the service  billed or shipping the
          Products billed.

     7.2  Late  Charge.  Any  amount  not paid when  within 45 days of  Serono's
          receipt of Bioject's invoice shall accrue a late payment charge at the
          rate of one percent (1%) per month  thereafter,  provided that the fee
          charged shall not exceed the highest rate permitted  under  applicable
          law.   The  late   payment   charge   shall  be   payable   by  Serono
          notwithstanding  any  other  remedy  elected  by  Bioject  under  this
          Agreement,  including without limitation  termination of the Agreement
          in accordance with Section 20.4, below.

8.   Delivery, Shipment and Inspection.

     8.1  Delivery; Shipment. Delivery of the Products purchased by Serono shall
          be made F.O.B. Bioject's factory in the continental United States, and
          Bioject  will give  Serono firm  shipment  dates of all  shipments  in
          accordance  with  Serono's  Purchase  Orders.  Products at the time of
          delivery  will be in good  condition  and  packaged  for  shipment  in
          accordance with standard commercial  practices and Serono's reasonable
          instructions.  Serono  shall  take  title to the  Products  upon  such
          delivery  and all risks of loss and  expenses in  connection  with the
          Product  shall   thereafter  rest  upon  Serono   including,   without
          limitation,  all risks and expenses  incurred in the storage,  cartage
          and  transportation of the Products,  as well as all insurance,  fees,
          charges, taxes, customs, duties and governmental charges or levies and
          all other  charges and expenses  whatsoever  thereafter  incurred with
          respect to the  Products.  At the  request of Serono,  but at the sole
          expense  of Serono,  Bioject  shall  procure  insurance  coverage  for
          shipments of the Products.

     8.2  Inspection.   Serono  shall  promptly   perform  an  external   visual
          inspection of shipping cartons containing  Products following receipt.
          Serono shall also perform quality assurance testing on a sample basis.
          Serono  shall notify  Bioject in writing  within sixty (60) days after
          arrival  of any  packing  shortages  or of any  other  failure  of the
          Products to conform to this  Agreement  based on its  external  visual
          inspection of the shipping

                                      -7-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.
<PAGE>

          cartons  and  actual  sample  testing.  Subject  to Section 12 hereof,
          Serono  further shall notify  Bioject in writing of any other failures
          of the  Product  to conform to the  Agreement  within  sixty (60) days
          after the date of Serono's actual discovery thereof. All notifications
          shall be  accompanied  by packing  slips,  inspection  reports and all
          other documents supporting Serono claims.

     8.3  Partial  Shipments.  Bioject shall,  if requested by Serono,  have the
          right to make partial shipments; each partial shipment shall be deemed
          a separate sale and payment  therefore  shall become due in accordance
          with the provisions of this Agreement.

9.   Assistance and Training.  Bioject shall, as reasonably requested by Serono,
     render advice to Serono in  connection  with  Serono's  soliciting  orders,
     familiarize  Serono  with  the  operation  of  the  Products,   and  render
     assistance  to Serono in training  Serono's  employees in  connection  with
     soliciting orders for the Products.

     Any training and assistance  requested by Serono which necessitates  travel
     or other  additional  out-of-pocket  costs to Bioject  shall be at Serono's
     expense and shall be due and payable within 45 days of invoicing.

10.  Additional Obligations of Serono.

     10.1 Personnel.  Serono  shall  engage  qualified  representatives  who are
          familiar with the Products and their uses to sell the Products.

     10.2 Promotions.  Serono shall  refrain from false or  misleading  sales or
          promotions concerning the Products.

     10.3 Territory.  Serono shall refrain from  establishing or maintaining any
          branch, warehouse or distribution facility for the Products outside of
          the  Territory.   Serono  shall  not  engage  in  any  advertising  or
          promotional  activities relating to the Products directed primarily to
          customers  outside the  Territory.  Serono  shall not  solicit  orders
          directly from any  prospective  purchaser with its principal  place of
          business located outside the Territory.

          If  Serono  receives  any order  from a  prospective  purchaser  whose
          principal  place of business is known to Serono to be located  outside
          the  Territory,  Serono  shall  promptly  refer that order to Bioject.
          Serono  shall not  knowingly  accept any such  orders.  Serono may not
          deliver or tender (or cause to be delivered  or tendered)  any Product
          outside of the Territory.

     10.5 Compliance  With  Laws.   Serono  shall  comply  with  all  applicable
          requirements of law, including without limitation  requirements of the
          FDA and of any similar non-U.S. government agency; shall obtain at its
          own  expense  all  licenses,   permits,   certificates  or  regulatory
          clearances

                                      -8-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.
<PAGE>

          which are required under applicable law to conduct its business and to
          resell the Products as contemplated  herein; and shall comply with all
          other laws, rules and regulations applicable to such business.

     10.6 Customer  Complaints.  Serono shall provide,  upon Bioject's  request,
          copies  of  customer  complaints  received  by Serono  concerning  the
          Products.  Serono shall  cooperate  fully with Bioject in dealing with
          customer  complaints  concerning the Products and shall,  at Bioject's
          cost and expense,  take such action as Bioject  reasonably may request
          to resolve such complaints.

     10.7 Training.  Serono also shall provide ongoing training  services to its
          customers who are medical professionals  administering  Serono's human
          growth  hormone  product with the Products to the extent  necessary to
          assure  that such  personnel  are  adequately  trained to utilize  the
          Products.

     10.8 Inventory.   Serono  shall  have  the  system  capabilities  to  trace
          shipments  of Products by customer  via product  code and lot.  Serono
          agrees to maintain  inventory levels of Bioject  Products  appropriate
          for the Field and the Territory.

11.  Advertising, Demonstration and Training Materials.

     11.1 Materials.  Bioject will furnish to Serono, at its own cost, copies of
          all  sales  and  promotional   materials  such  as  sales  literature,
          technical data,  instruction  manuals,  technical journal reprints and
          training videos, with respect to the Products as Serono may reasonably
          request from time to time. All such materials shall be in such formats
          as Serono may  reasonably  request to permit Serono to develop its own
          custom version of the materials for use in marketing the Products as a
          delivery  system for Serono's  human growth hormone  product.  Bioject
          shall cooperate with Serono to produce versions of Bioject's  standard
          materials  which are  appropriate  for use by Serono in marketing  the
          Products  as a  delivery  system for  Serono's  human  growth  hormone
          product.  Any  materials  loaned to Serono such as film or artwork for
          the purpose of Serono  preparing its own promotional  material must be
          promptly  returned  to  Bioject no later  than the date  specified  in
          writing  by Bioject  or, if not  specified,  30 days after  being made
          available by Bioject for such use.  Should  Serono fail to return such
          items to Bioject after written  request,  Bioject will invoice  Serono
          for the  replacement  cost of such items and  Serono  will pay for the
          cost of such items in accordance with Section 7.1 of this Agreement.

     11.2 Translation.  Serono shall translate, at its own expense, all user and
          technical manuals, and advertising and marketing information, into the
          languages  of its  customers  accurately.  Serono  agrees  to  provide
          Bioject  with  copies  of  such  materials   prior  to  their  use  or
          dissemination by

                                      -9-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.
<PAGE>

          Serono.  Serono further agrees to provide  Bioject with advance copies
          of  any  other  promotional  and  technical  materials  regarding  the
          Products  prepared by Serono for review and approval by Bioject,  such
          approval not to be unreasonably withheld or delayed.

     11.3 Demonstration Units. Bioject agrees to furnish to Serono, at Bioject's
          own  cost,  a  reasonable  number of  Products  necessary  to  provide
          demonstrations  to interested,  potential  customers.  The quantity of
          Products  supplied  by Bioject to Serono  for  demonstration  purposes
          shall  be  not  less  than  ***  needle-free  devices  and  associated
          supplies. As of the date of this Agreement,  *** demonstration devices
          have been delivered by Bioject to Serono.

12.  Warranties,   Limitation   and  Disclaimer  of  Warranties  and  Limitation
     Remedies.

     12.1 Warranty.  Bioject  represents  and  warrants  to  Serono  (and to its
          distributors,  customers and users of the Products)  that the Products
          shall be free from defects in materials and  workmanship  for a period
          of  eighteen  (18)  months  from the date of delivery by Serono or its
          distributors  or  wholesalers  to  the  end  user.   Serono  shall  be
          responsible for providing  reasonable proof of the shipment date. This
          Warranty does not apply to Products which have been altered,  used for
          a purpose other than one for which they were manufactured,  or used in
          any manner inconsistent with Bioject's written instructions.

          This  Warranty  expires  absolutely at the end of eighteen (18) months
          following  sale of the  Products  by  Serono  or its  distributors  or
          wholesalers  to the end user. No defects  discovered  after the end of
          such period are covered by this Warranty.

          The Warranty set forth in Section 12.1 herein applies to demonstration
          Products only so long as they are used as  demonstration  Products and
          shall  terminate  upon the earlier of 18 months from the date of first
          use or the time of the first use for other than demonstration purpose.

     12.2 Claim for Breach of Warranty. Serono (or its distributor,  customer or
          any end user)  shall  notify  Bioject in writing of any defect  within
          sixty (60) days following the time  prescribed in Section 12.1 and, at
          Bioject's  request,  shall  send  the  part  or  item  believed  to be
          defective  to  Bioject,   F.O.B.  Bioject's  designated  facility  for
          examination and inspection.  Serono (or its  distributor,  customer or
          any end user) shall  furnish in writing the serial number of each such
          Product and a description of the alleged defect.  Bioject shall not be
          responsible  for any defect due to  alteration  or improper use of the
          Products.  Bioject  will return any repaired or  replacement  items to
          Serono  (or  its  distributor,  customer  or  any  end  user),  F.O.B.
          Bioject's facility.  Bioject will provide  reimbursement or credit for
          shipping costs with respect to Products found to have a defect covered
          by this Warranty. With respect to Products that are defective,  but do
          not cause personal injury, death or a

                                      -10-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.
<PAGE>

          recall and  provided  that the defects are not so frequent or numerous
          so as to  constitute  a  substantial  failure  to supply  Products  in
          accordance with Serono's  forecasts and Purchase Orders, the exclusive
          remedy  for  breach  of  Bioject's  Warranty  hereunder  shall  be, at
          Bioject's option, repair or replacement of the units of Products which
          were not as  warranted  or refund of the  purchase  price with respect
          thereto.

     12.3 Product  Meets   Specifications  and  cGMPs.  Bioject  represents  and
          warrants that all Products  delivered to Serono  hereunder  shall: (i)
          have been manufactured in accordance with this Agreement, current Good
          Manufacturing  Practices  and all  applicable  laws,  regulations  and
          rules,  all as in  effect  from  time  to  time;  and  (ii)  meet  the
          Specifications for the Products and all commitments made in regulatory
          filings for the Products. Bioject further represents and warrants that
          no Product shall be  adulterated or misbranded as those terms are used
          under the Federal Food, Drug and Cosmetic Act, as amended,  due to any
          action or omission of Bioject.

     12.4 Product Approvals; Licensing. Bioject has secured (or will secure) and
          will maintain in effect all approvals,  licenses and permits necessary
          for  the  manufacture,  marketing,  sale  and use of the  Products  to
          administer  Serono's human growth hormone product in the United States
          and  Canada  and,  after and  exercise  of the  option  to extend  the
          Territory to all countries of the world, in Japan and all countries of
          the European Union and such other foreign countries  requested by ***.
          Bioject represents and warrants that it has obtained and will maintain
          on a current  basis and will  comply  with all  licenses,  permits and
          approvals of applicable  governmental  agencies as may be required for
          its facilities and the  manufacture of the Products and to perform its
          obligations hereunder. Bioject represents and warrants that it has not
          received any notice of adverse findings or similar  regulatory letters
          from  regulatory  agencies  with  respect to the  Products  or similar
          products or the facilities in which the Products will be manufactured.
          Bioject has disclosed to Serono all information relevant to the safety
          and efficacy of the Products and similar products in its possession as
          of the date  hereof,  and will  disclose to Serono  promptly  and on a
          continuous  basis all  additional  such  information  obtained  in the
          future.

     12.5 Compliance  with Laws.  Bioject  represents and warrants that it shall
          comply in all  respects  with all  federal,  state,  and  local  laws,
          regulations and other requirements  applicable to the Products and the
          performance of Bioject's obligations under this Agreement.

     12.6 DISCLAIMER  OF  WARRANTY.  EXCEPT AS  EXPRESSLY  PROVIDED IN THE ABOVE
          WARRANTY,  BIOJECT  MAKES NO  REPRESENTATION  OR WARRANTY OF ANY KIND,
          EXPRESS  OR  IMPLIED,  WITH  RESPECT  TO THE  PRODUCTS,  WHETHER AS TO
          MERCHANTABILITY,  FITNESS  FOR A  PARTICULAR  PURPOSE,  OR  ANY  OTHER
          MATTER.  NO AGENT,  EMPLOYEE  OR  REPRESENTATIVE  OF  BIOJECT  HAS ANY
          AUTHORITY

                                      -11-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.
<PAGE>

          TO BIND BIOJECT TO ANY AFFIRMATION, REPRESENTATION OR WARRANTY, EXCEPT
          AS STATED HEREIN.

     12.7 Maximum Liability. The maximum liability of one party to the other for
          economic losses under this Agreement, including with respect to claims
          under Section 13  (Indemnification),  shall be $***.  This  limitation
          shall not apply to  recalls  of a  Product,  claims,  costs and losses
          arising from personal injury or death caused by use of the Products or
          Serono's growth hormone  product,  or any breach of Sections 1.6, 3 or
          17.

     12.8 Warranties  of  Serono.  Any  warranties  or  representations,  or any
          remedies for breach thereof, which Serono may provide to its customers
          which are different from or in addition to the warranties and remedies
          provided  by  Bioject  under  this  Agreement   shall  be  solely  the
          responsibility  of Serono,  and Bioject  shall not be bound thereby in
          any manner whatsoever.

13.  Indemnification.

     13.1 Definition of Claims.  For purposes of this Agreement,  "Claims" shall
          mean  any and all  claims,  demands,  losses,  liabilities,  lawsuits,
          proceedings,  damages,  settlement  amounts  and costs  and  expenses,
          including, without limitation, attorneys' fees and costs.

     13.2 Indemnification by Bioject. Bioject shall indemnify,  defend, and hold
          Serono,  its wholesalers and distributors and their Affiliates and the
          officers,   directors,    employees,   agents,   representatives   and
          independent contractors of each of them, harmless from and against any
          and all Claims arising from or related to: (i) injury,  death or other
          loss  caused by use of the  Products;  or (ii)  Bioject's  negligence,
          willful  misconduct  or breach of this  Agreement or any  undertaking,
          covenant,  representation  or warrant  contained  herein.  The Parties
          acknowledge  and agree  that  acceptance  by Serono of any  Product or
          expiration  of any  warranty  set forth in Section 12 shall not affect
          its rights to indemnification hereunder.

     13.3 Indemnification  by Serono.  Except with respect to any matter covered
          by Section  13.1  above,  Serono  shall  indemnify,  defend,  and hold
          Bioject and its  Affiliates and the  directors,  officers,  employees,
          agents,  representatives and independent  contractors or each of them,
          harmless  from and against any and all Claims  arising from or related
          to: (i) injury,  death or other loss  caused by use of Serono's  human
          growth  hormone  product;   or  (ii)  Serono's   negligence,   willful
          misconduct or breach of this Agreement or any  undertaking,  covenant,
          representation or warranty contained herein.

     13.4 Procedures.   Any  party  seeking   indemnification   hereunder   (the
          "Indemnified  Party")  shall give the other  party (the  "Indemnifying
          Party") prompt written notice of the Claims for which  indemnification
          is sought.

                                      -12-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.
<PAGE>

          Failure of an  Indemnified  Party to provide  notice of a Claim to the
          Indemnifying  Party  shall  affect the  Indemnified  Party's  right to
          indemnity  only to the  extent  such  failure  shall  have a  material
          adverse effect on the  Indemnifying  Party's  ability to defend or the
          nature  or  amount  of  liability.  Claims  shall be  defended  by the
          Indemnifying  Party with counsel selected by it. The Indemnified Party
          shall have the right to be represented  by advisory  counsel and other
          representatives, at its own expense. The Indemnifying Party shall keep
          the  Indemnified  Party  reasonably  informed  as to the status of the
          Claim.  The Parties shall render to each other such  assistance as may
          be reasonably required for the proper and adequate defense of a Claim.
          Except as otherwise  provided in Section 13.4, the Indemnifying  Party
          shall not make any settlement of any Claim without the written consent
          of the  Indemnified  Party,  which consent  shall not be  unreasonably
          withheld or delayed.  Notwithstanding the foregoing,  the Indemnifying
          Party may make any  settlement  which  solely  involves the payment of
          money and which the Indemnifying Party actually pays.

14.  Mandatory Insurance.

     14.1 By Bioject.

          (a) During  the term of this  Agreement,  Bioject  shall  procure  and
     maintain in full force and effect,  at its own cost and expense,  insurance
     against the risks  specified in this Agreement in amounts not less than the
     amounts specified in (b), below.

          (b) Bioject  shall  maintain  the  following  minimum  coverages  with
     respect to the matters covered by this Agreement:

               (1)  Worker's  Compensation  insurance  in  compliance  with  the
               Worker's  Compensation  laws of the  state  or  states  in  which
               Bioject has employees  performing work under this Agreement,  and
               employer's  liability  insurance  with respect to such  employees
               with a minimum limit of $100,000/occurrence.

               (2) Commercial general liability  insurance  including  premises,
               broad  form  property  damage,  contractual,   products/completed
               operations  coverage,  with a minimum  limit of  $5,000,000  each
               occurrence.

          (c) Terms of such  coverage  shall be  evidenced  by  certificates  of
     insurance  issued by a  recognized  insurer  rated by A.M.  Best  A-(XV) or
     better,  to be  furnished  by  Bioject to Serono at the  inception  of this
     Agreement and as may be reasonably requested thereafter.  Such certificates
     shall  name  Serono  and its  Affiliates  or  their  agents,  employees  or
     directors,  as  additional  insured,  as their  interests  may appear,  and
     provide  that thirty  (30) days'  written  notice  shall be given to Serono
     prior to  cancellation,  modification  or expiration of any of the terms of
     coverage of any policy.

                                      -13-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.
<PAGE>

     14.2 By Serono.

          (a)  During  the  Term of this  Agreement  Serono  shall  procure  and
     maintain in full force and effect,  at its own cost and expense,  insurance
     against the risks  specified in this Agreement in amounts not less than the
     amounts specified in (b), below.

          (b) Serono shall maintain the following minimum coverages with respect
     to the matters covered by this Agreement:

               (1)  Workers'  Compensation  insurance  in  compliance  with  the
               Worker's Compensation laws of the state or states in which Serono
               has  employees   performing  work  under  this   Agreement,   and
               employer's  liability  insurance  with respect to such  employees
               with a minimum limit $100,000/occurrence.

               (2) Commercial general liability  insurance  including  premises,
               broad  form  property  damage,  contractual,   products/completed
               operations  coverage,  with a minimum  limit of  $5,000,000  each
               occurrence.

          (c) Terms of such  coverage  shall be  evidenced  by  certificates  of
     insurance  issued by a  recognized  insurer  rated by A.M.  Best  A-(XV) or
     better,  to be  furnished  by Serono to  Bioject at the  inception  of this
     Agreement and as may be reasonably requested thereafter.  Such certificates
     shall name  Bioject  and its  Affiliates,  or their  agents,  employees  or
     directors as an additional  insured,  as their  interests  may appear,  and
     provide  that thirty (30) days'  written  notice  shall be given to Bioject
     prior to  cancellation,  modification  or expiration of any of the terms of
     coverage of any policy.

15.  Recall of Product.

     15.1 Notice.  In the event  either  party has  reason to  believe  that any
          Product should be recalled or withdrawn from  distribution  such party
          shall   immediately   inform  the  other  in  writing  in  a  factual,
          non-judgmental manner.

     15.2 Decision.  The  decision as to whether or not to initiate a recall may
          be made by  Serono  after  consultation  with  Bioject.  Serono  shall
          conduct any recall.

     15.3 Bioject's Liability.  If such recall is required because of failure of
          a Product  to conform  to the  warranties  in Section 12 or due to any
          other defect relating to the Products,  then the costs and expenses of
          such recall  shall be paid or  reimbursed  by Bioject and, at Serono's
          option, Bioject shall replace such recalled Products or issue a credit
          in favor of Serono  or  refund  the  purchase  price of such  recalled
          Products.

                                      -14-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.
<PAGE>

     15.4 Serono's Liability.  If such recall is required because of a negligent
          act or omission by Serono in the handling,  storage or distribution of
          a Product,  then such recall  shall be conducted by Serono at its sole
          cost and expense and Serono shall not be entitled to any such credits,
          replacements or refunds from Bioject.

16.  Independent  Contractor.  This Agreement does not designate either party as
     an  agent,  employee,   joint  venturer,   partner,   franchisee  or  legal
     representative of the other party for any purpose whatsoever. Neither party
     is  granted,  and at no time shall  imply or claim that it  possesses,  any
     right or authority to assume or create any obligation or  responsibility on
     behalf  or in the  name of the  other  party  or to  bind it in any  manner
     whatsoever.  The Products purchased by Serono shall be owned by Serono, and
     Serono  shall  handle  the  same at its own  risk,  assuming  directly  all
     responsibility for its costs and expenses related to this Agreement and all
     contingencies  of profit and loss with  respect to its  performance  of its
     responsibilities  and duties  under this  Agreement,  Serono shall have the
     sole right to control the manner in which it performs its  responsibilities
     and duties under this Agreement, subject to no control by Bioject except as
     otherwise expressly provided in this Agreement and shall not be entitled to
     any assistance  from Bioject with respect to the performance of such duties
     except as otherwise expressly provided in this Agreement.  Serono is solely
     responsible  for  making,   and  represents  that  it  has  made,  its  own
     determination  concerning the  availability of a market for the Product and
     acknowledges that Bioject has made no claims, representations or statements
     to the  effect  (a) that  there is a market  for the  Products;  (ii)  that
     Bioject will locate customers for Serono;  or (iii) that Serono will earn a
     profit in the business of  distributing  the  Products.  Serono and Bioject
     shall each  indemnify  and save each other  harmless  from and  against all
     claims,  damages,  losses,  liabilities,   expenses  and  costs  (including
     reasonable  attorneys'  fees)  related to or  arising  out of any action of
     conduct, or failure to act, of or by Serono and Bioject, their employees or
     agent,  including those purported but not actually authorized in writing by
     any authorized officer of Bioject or Serono.

17.  Protection of Confidential Information and Trademarks.

     17.1 Information. Serono and Bioject acknowledge that they may acquire from
          the other, certain trade secrets and confidential information relating
          to  know-how,  technical  data,  service,  promotion  and  sale of the
          Products or human growth  hormone,  and the identity of customers  and
          potential customers. Serono and Bioject agree that the foregoing is of
          substantial  value in their  respective  businesses and each agrees to
          keep the same confidential and not to disclose it to any person during
          or after  the term  hereof.  Notwithstanding  the  foregoing,  Bioject
          acknowledges that Serono possesses  substantial  information regarding
          the  market,   customers  and   potential   customers  for  and  other
          information  about  human  growth  hormone  and human  growth  hormone
          delivery  systems.  All  of  this  existing   information,   including
          additional  information  obtained or  developed  by Serono  during the
          course of this Agreement,

                                      -15-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.
<PAGE>

          shall be the confidential  information of Serono and Bioject shall not
          acquire any interest therein.

     17.2 Exceptions to Mutual  Confidentiality  Obligations.  The obligation to
          maintain in confidence all confidential  information shall survive the
          termination of this Agreement, but shall not apply to any information:
          (a) which was known to the receiving  party at or prior to the time of
          its disclosure by the  disclosing  party as evidenced by the receiving
          party's  written  records;  (b) which  becomes  lawfully  known to the
          receiving party without any obligation of  confidentiality at any time
          through  a  third   party  not  in   breach   of  an   obligation   of
          confidentiality;  (c) which is or becomes known to the general  public
          through no fault of the receiving  party;  (d) which is  independently
          developed by the receiving  party;  (e) which the  receiving  party is
          required by law to disclose,  provided notice of such disclosure shall
          be  given  promptly  to the  disclosing  party  so  that  it may  take
          reasonable   actions  to  avoid  and   minimize  the  extent  of  such
          disclosure.

     17.3 Regulatory Exception of Serono. Serono shall be entitled to submit and
          disclose to any regulatory authority and in any regulatory application
          any  and  all  information,   including  confidential  information  of
          Bioject,  required by law or regulation or deemed  necessary by Serono
          to  obtain  approvals  for the  marketing,  sale and use of its  human
          growth hormone product with the Products in the Territory.

     17.4 Bioject's   Trademarks.   Bioject  hereby  authorizes  Serono  to  use
          Bioject's  trademarks  and  trade  names  for the  Products  solely in
          connection  with  advertising,  promoting,  selling,  or servicing the
          Products  during  the term of this  Agreement.  Serono may not use the
          name  "Bioject"  in its  corporate or business  name,  or in any other
          manner which Bioject deems adverse to its interest.

     17.5 Serono's  Trademarks.  The Products  shall be  "private-labeled"  with
          tradenames and trademarks  designated by Serono.  Serono shall own and
          have  the  exclusive  right,  title  and  interest  in and to all such
          tradenames and trademarks during and after the term of this Agreement.
          Bioject  shall  have no  right to use such  tradenames  or  trademarks
          except as directed by Serono during the term of this Agreement.

     17.6 Termination.  The  authorization  to use names,  trademarks  and trade
          names owned by Bioject shall terminate  effective upon  termination of
          this Agreement for any reason,  and Serono  thereupon  shall cease all
          use of names,  trademarks,  or trade  names  owned or used by Bioject,
          except for a Product already owned by Serono.

     17.7 Patent  Prosecution  and  Infringement.  Bioject  shall,  at its cost,
          prepare and  diligently  prosecute  patent  applications  covering the
          Products in the

                                      -16-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.
<PAGE>

          Territory and continuations, divisions, renewals and reissues thereof.
          Bioject shall diligently enforce its patent rights.

18.  Inventions and Indemnitees.

     18.1 Inventions,   Modifications,   and  Improvements  in  the  Field.  New
          techniques,  inventions,  processes,  and know-how  (hereinafter  "New
          Developments")  relating to the Products or the Field may be developed
          by  Serono,  Bioject  or by Serono  and  Bioject  jointly  during  the
          performance of this Agreement.  Serono shall own any New  Developments
          which are developed solely by Serono.  To the extent that any such New
          Developments  are created by Bioject or jointly by Bioject and Serono,
          in either  case,  at the  direction  or expense of Serono  pursuant to
          Section 1.2, then Serono shall have ownership of such New Developments
          and   Bioject   shall   have   a   non-transferable,    non-exclusive,
          royalty-free,  worldwide,  perpetual  license  to make and use the New
          Developments  as long as Bioject's  use does not  compromise  Serono's
          proprietary or confidential information.  Notwithstanding the grant of
          such  license,  Bioject  shall  not use any  such New  Development  to
          compete,  or assist third parties to compete,  directly or indirectly,
          with Serono in the sale of human  growth  hormone for any  therapeutic
          use.  Bioject agrees to cooperate in the filing and prosecution of all
          New Development  patent  applications  owned by Serono and to take all
          other  actions  requested  by  Serono  to  vest  ownership  of all New
          Developments in Serono.

     18.2 Indemnity by Bioject. Bioject shall indemnify, defend and hold Serono,
          its Affiliates and their respective officers,  directors and employees
          from  and  against  any  damages,  liabilities,   costs  and  expenses
          (including  reasonable attorneys' fees and court costs) (collectively,
          "Damages")  arising out of claims  that proper use of the  Products in
          the  Field,  in  accordance  with  its  instructions  infringe  on the
          intellectual  property  rights of third  parties;  provided,  however,
          that:  (a) Serono shall have  promptly  provided  Bioject with written
          notice thereof and reasonable cooperation, information, and assistance
          in connection  therewith;  and (b) Bioject shall have sole control and
          authority  with  respect to the  defense,  settlement,  or  compromise
          thereof;  provided,  however,  that any settlement or compromise  that
          would impose  liability on Serono shall require Serono's prior written
          consent.

     18.3 Indemnity by Serono. Serono shall indemnify,  defend and hold Bioject,
          its Affiliates and their respective officers,  directors and employees
          from  and  against  any  damages,  liabilities,   costs  and  expenses
          (including  reasonable attorneys' fees and court costs) (collectively,
          "Damages")  arising out of claims that proper use of any human  growth
          hormone,   in  accordance  with  its  instructions   infringe  on  the
          intellectual  property  rights of third  parties;  provided,  however,
          that:  (a) Bioject  shall have promptly  provided  Serono with written
          notice thereof and reasonable cooperation, information, and assistance
          in  connection  therewith;  and

                                      -17-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.
<PAGE>

          (b) Serono shall have sole control and  authority  with respect to the
          defense,  settlement, or compromise thereof;  provided,  however, that
          any  settlement or compromise  that would impose  liability on Bioject
          shall require Bioject's prior written consent.

     18.4 Notification   of  Suit.  Each   indemnified   party  shall  give  the
          indemnifying  party written notice of any suit or action  described in
          Section 18.2 or 18.3 wherein  indemnification is claimed.  Such notice
          shall be given  within 30 days after  acquiring  such  knowledge or at
          least  five days prior to the  expiration  of time in which a response
          must be filed with a court or other judicial body,  whichever is first
          to occur.

19.  Initial Term and Renewal. Unless sooner terminated as hereinafter provided,
     this  Agreement  shall continue in force for three years from the Effective
     Date.  Thereafter,  this Agreement may be renewed only by written agreement
     of the parties.

20.  Termination. This Agreement may be terminated as set forth below.

     20.1 Mutual Termination. This Agreement may be terminated by mutual written
          agreement executed by both parties.

     20.2 Termination by Serono.  Serono may terminate  this  Agreement  without
          cause or reason at any time upon 90 days notice to Bioject.

     20.3 Delay  in  Regulatory  Approval.   Either  party  may  terminate  this
          Agreement  at any time  after *** if  Bioject  shall not have  secured
          approval from the FDA of the  marketing,  sale and use of the Products
          as a delivery system for Serono's human growth hormone.

     20.4 Breach.   Either  Serono  or  Bioject  may  terminate  this  Agreement
          effective upon sending  written notice to the other,  if a party fails
          to pay the other any amount  when due or commits  any other  breach or
          default  hereunder or otherwise  fails to perform any of its duties or
          responsibilities hereunder;  provided that such failure to pay or such
          other breach,  default or  nonperformance  shall have  continued for a
          period of thirty (30) business days following  receipt by a party of a
          written notice from the other specifying the nature of such failure to
          pay or such other breach,  default or nonperformance.  Notwithstanding
          such termination,  Serono shall continue to be obligated to accept and
          pay for any of the Product  ordered by Serono  prior to the sending of
          such notice.  Similarly, any late payment charges accruing pursuant to
          Section 7.3 above, survive such termination.

     20.5 Insolvency.  If  (a) a  party  becomes  insolvent;  or a  petition  in
          bankruptcy  is  filed  by or  against  a  party;  or a party  makes an
          assignment for the benefit of its creditors;  or a receiver or trustee
          is appointed  for any of a party's  property;  or (b) a party fails to
          cure or  remedy  any  breach,  default  or  non-performance  for which
          written 30-day notice has been sent by a

                                      -18-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.
<PAGE>

          party,  then  the  other  party  may  (i)  terminate  this  Agreement,
          effective upon the sending of written notice of such termination; (ii)
          suspend its  performance  hereunder and stop any shipments in transit;
          (iii)  declare  all  amounts  unpaid  hereunder  to be due and payable
          immediately;  or (iv) exercise any and all other remedies  provided by
          applicable law.

21.  New Needle Free Devices.  Bioject shall inform Serono on a quarterly  basis
     of  each  needle-free  device  that  Bioject  or any of its  Affiliates  is
     developing or has acquired rights. If Serono *** to *** to the *** pursuant
     to Section *** then,  thereafter,  as Bioject *** in or to *** which is not
     *** and which could be ***, Bioject shall promptly provide Serono with ***.
     The *** shall propose terms on which Serono may *** to *** and *** for ***,
     and,  alternatively,  ***. Upon receipt of a ***,  Serono shall have *** to
     either  *** of *** in the *** for the *** or provide a *** to  Bioject.  If
     Serono *** of the *** for the ***, the parties shall prepare and execute an
     agreement  reflecting the terms of their arrangement.  If Serono provides a
     ***,  Bioject shall *** and *** for a *** to establish  ***. If Serono does
     not accept the terms of Bioject's *** and the parties do not agree on terms
     pursuant  to  which  Serono  could  ***,  then  Bioject  may,  at any  time
     thereafter,  grant *** with respect to *** to *** on ***. Bioject shall not
     discuss or negotiate for the *** with respect to a *** for *** until it has
     provided any *** to Serono and the applicable time periods have expired.

22.  Remedies Cumulative.  The remedies provided herein to Bioject and to Serono
     shall be  cumulative  and in  addition to all other  remedies  which it may
     exercise in equity or at law,  and its  exercise of any one or more of such
     remedies, or a waiver of its right to exercise any other remedy or remedies
     at the same time or at any other time shall not be deemed to be a waiver of
     any other remedy of Bioject or Serono.

23.  Duties  Upon  Termination.  Upon  termination,  at the  request  of Serono,
     Bioject shall fill all of Serono's  orders for the Products as set forth in
     the binding  portion of its rolling  forecast and Serono shall purchase and
     pay for all Products  subject to such  orders.  Serono may continue to sell
     Products until it has disposed of its inventory.

24.  Survival.   Termination  shall  not  affect  the  continued   operation  or
     enforcement of the following Sections of this Agreement:  12, 13, 15, 17.1,
     17.2, 17.5, 18, 22, 23, 25, 27, 29, 30 and 31.

25.  Nonliability  for  Termination.   If  either  party  shall  terminate  this
     Agreement in accordance with the terms hereof,  then such terminating party
     shall not be  liable  to the  terminated  party  for any  losses,  damages,
     expenditures,  investments or  commitments  made by such  terminated  party
     pursuant to or in connection with this  Agreement,  whether related to such
     terminated party's lost business, lost profits, lost goodwill or otherwise.

26.  Force  Majeure.  Neither  party  shall be deemed to be in breach  hereof or
     liable to other  party or any other  person in any manner on account of any
     delay in  delivery or other  performance  caused in whole or in part by, or
     otherwise

                                      -19-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.
<PAGE>

     materially related to the occurrence of any contingency beyond such party's
     reasonable  control,  including  without  limitation,  fire,  flood,  riot,
     hostilities,   strikes  or  other  labor  disputes,  freight  embargoes  or
     transportation delays; shortage of labor; inability to secure fuel, energy,
     materials,  supplies or power at reasonable  prices from regular sources or
     on account of shortages thereof;  delays or failures of any of such party's
     suppliers to deliver;  acts of God or of a public enemy; or any existing or
     future laws,  acts or  regulations  of the Federal or of any state or local
     government (including specifically but not exclusively any orders, rules or
     regulations issued by an official,  court or agency of any such government)
     affecting the conduct of such party's  business  with which such party,  in
     its  judgment  and  discretion,  deems it  advisable to comply as its legal
     duty.

27.  Entire Agreement;  Modification and Waiver.  This Agreement,  together with
     the Schedules  attached hereto,  constitute the complete  understanding and
     contract with respect to the subject  matter  hereof.  Neither  Bioject nor
     Serono shall be bound by any purported rescission,  addition, modification,
     or waiver of any provision  hereof,  or any purported waiver, or any breach
     hereof  unless such  rescission,  addition,  modification  or waiver is set
     forth in a writing  signed by an  authorized  agent of  either  Bioject  or
     Serono, respectively.

28.  Nonassignment. Except as provided in Section 1.7, neither party may assign,
     transfer  or sell  all or any part of its  right,  benefits  or  privileges
     hereunder  without the other party's prior written consent.  Any attempt to
     do so without such prior consent shall be wholly void.  This Agreement will
     be transferred  and assigned on all legal  successors of Bioject and Serono
     and (i) any successor to Serono's  business of selling human growth hormone
     for the treatment of growth deficiencies or (ii) any successor to Bioject's
     business of selling needle-free devices.

29.  Public  Announcements.  Neither  Serono  nor  Bioject  will  originate  any
     publicity, news release, or other public announcement or comments,  written
     or oral, whether to the press,  stockholders or otherwise,  related to this
     Agreement without the consent of the other party, except as may be required
     by law. The party making any announcement  which it reasonably  believes to
     be required by law will first give the other party an opportunity to review
     the form and content of any such announcement and comment upon it before it
     is made.

30.  Notices.  Any notice  required or  permitted to be made or given under this
     Agreement  shall be in writing and transmitted by hand,  prepaid  certified
     mail,  air courier or telecopier  addressed to the party to whom the notice
     is given at its address or  telecopier  number shown below or at such other
     address as the addressee shall have theretofore furnished in writing to the
     other party.

                                      -20-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.
<PAGE>

     Until changed, the address of Bioject shall be as follows:

              Bioject, Inc.
              7620 S.W. Bridgeport Road
              Portland, Oregon 97224
              Attention:  President
              Telecopier:  (503) 624-9002

         with a copy to:

              Michael Redmond
              Bioject Inc.
              7620 S.W. Bridgeport Road
              Portland, Oregon   97224
              Telecopier:  (503) 624-9002

         Until changed, the address of Serono shall be:

              Serono Laboratories, Inc.
              100 Longwater Circle
              Norwell, MA 02001
              Attention:  President
              Telecopier:  (781) 982-9478

         with a copy to:

              Serono Laboratories, Inc.
              100 Longwater Circle
              Norwell, MA 02001
              Attention:  General Counsel
              Telecopier:  (781) 878-6954

     Notices or written communications shall be deemed to have been sufficiently
made or  given  (i) if by  in-hand  delivery  or by  telecopier  with  confirmed
transmission,  when  performed,  (ii) if  mailed,  five  (5)  days  after  being
deposited in the mail, postage prepaid; or (iii) if by air courier,  one (1) day
after delivery to the air courier company.

31.  Construction of Agreement,  Controlling  Law. This  Agreement,  which is in
     English,  shall be interpreted in accordance  with the commonly  understood
     meaning of the words and  phrases  hereof in the United  States of America,
     and it and  performance  of the  parties  hereto  shall  be  construed  and
     governed  according  to the laws of the  State of New  York  applicable  to
     contracts made to be fully performed therein.

SCHEDULES  1.1  (Specifications)  2.1  (Patents),  5 (License  Fees and Purchase
Quotes) AND 6.1 (Product  Pricing)  ATTACHED  HERETO ARE A MATERIAL PART OF THIS
AGREEMENT AND ARE INCORPORATED HEREIN BY THIS REFERENCE.

                                      -21-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.
<PAGE>

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
in the manner appropriate to each, effective as of the date entered on the first
page hereof.

BIOJECT, INC.                                 SERONO LABORATORIES, INC.

By: ----------------------------              By: ------------------------------

Title: -------------------------              Title: ---------------------------

                                      -22-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.

<PAGE>

                                  SCHEDULE 1.1

                                 SPECIFICATIONS

Description:                             ***.
Weight:                                  ***
Size:                                    ***
Dosage Range:                            ***
Dosage Scale Graduation:                 ***
Duration of Injection:                   ***
Jet Nozzle Sizes:                        ***
Jet Pressure Setting:                    ***

                                      -23-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.

<PAGE>

                                  SCHEDULE 2.1

                                LICENSED PATENTS

United States Patent No. 5,782,802

     Any other U.S. or foreign  patents  applicable  to the Products  held by or
     licensed to Bioject.

                                      -24-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.

<PAGE>

                                   SCHEDULE 5

                        LICENSE FEES AND PURCHASE QUOTAS

License Fees

o    Serono  shall pay Bioject a one-time  $***  license  fee for the  exclusive
     license and distribution  right of the Products for the Field in the United
     States,  its  territories and possessions and Canada upon execution of this
     agreement.

o    Serono  shall pay  Bioject a one-time  $***  additional  license fee in two
     installments  pursuant to Section 1.6 if it elects to extend the  exclusive
     license in the Field to all countries of the world.

Annual Purchase Quotes

o    For  each  twelve  month  period  after  FDA  approval  of  Bioject's  510K
     application  for  marketing,  sale and use of the  Products  as a  delivery
     system for Serono's human growth  hormone,  Serono shall make the following
     purchases of Products in order to maintain exclusivity in the United States
     and Canada:

           ***
           ***
           ***
           ***
           ***

     Notwithstanding the foregoing,  if Serono's purchase of Products during any
such twelve month period is less than the quota, Serono may make a payment equal
to one-half of the shortfall and maintain exclusivity.

     Serono shall purchase $*** of Products within *** after written notice from
Bioject that Bioject has received FDA approval of its 510K  application  for the
marketing,  sale and use of the Products as a delivery system for Serono's human
growth hormone product.

o    For each twelve month period after the first anniversary of any exercise by
     Serono of its option to extend the  Territory to all countries of the world
     and approval of Bioject's  application  for marketing,  sale and use of the
     Products as a delivery  system for Serono's  human growth hormone in either
     Japan  or all  countries  of the  European  Union,  Serono  shall  make the
     following  purchases  of Products in order to maintain  exclusivity  in all
     countries of the world (including the United States and Canada):

           ***
           ***
           ***
           ***
           ***

                                      -25-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.
<PAGE>

     Notwithstanding  the  foregoing,  if  Serono's  ***  during any *** is ***,
Serono  may *** to ***.  The ***  shall be *** of the *** the *** and the *** by
Serono  during  the  applicable  period.  Bioject  shall  have  ***  to  ***  in
consideration of *** because the purpose of *** is to *** for *** to ***.

                                      -26-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.

<PAGE>

                                  SCHEDULE 6.1

                                 PRODUCT PRICING

           Product                   Price

             ***                     $***

          Supplies                   Price

***                           $***
***                           $***

                                                              Serono: ----------
                                                             Bioject: ----------
                                                                Date: ----------

                                      -27-

***Confidential  portions omitted and submitted separately to the Securities and
Exchange  Commission.   An  application  for  confidential  treatment  has  been
submitted  pursuant to Rule 24b-2 under the Securities  Exchange Act of 1934, as
amended.

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