Document:

06212001 8K EX10.40

Exhibit 10.40

 

REGISTRATION RIGHTS AGREEMENT

REGISTRATION RIGHTS AGREEMENT (this
"Agreement"), dated as of June 20,
2001, by and among SangStat Medical Corporation, a corporation organized
under the laws of the State of Delaware (the "Company"), and the
undersigned (together with their affiliates, the "Initial
Investors"). 

WHEREAS:

	In connection with the Securities Purchase Agreement of
even date herewith by and between the Company and the Initial Investors (the
"Securities Purchase Agreement"), the Company has agreed, upon the terms
and subject to the conditions contained therein, to issue and sell to the
Initial Investors shares of the Company's common stock, par value $.001 per
share (the "Common Stock").

	To induce the Initial Investors to execute and deliver
the Securities Purchase Agreement, the Company has agreed to provide certain
registration rights under the Securities Act of 1933, as amended, and the rules
and regulations thereunder, or any similar successor statute (collectively, the
"Securities Act"), and applicable state securities laws.

NOW, THEREFORE, in consideration of the premises and
the mutual covenants contained herein and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Company and
the Initial Investors hereby agree as follows:

	DEFINITIONS.

	As used in this Agreement, the following terms shall have
the following meanings:

	"Investors" means the Initial Investors and any
transferees or assignees who agree to become bound by the provisions of this
Agreement in accordance with Section 9 hereof.

	"register," "registered," and
"registration" refer to a registration effected by preparing and filing a
Registration Statement or Statements in compliance with the Securities Act and
pursuant to Rule 415 under the Securities Act or any successor rule providing
for offering securities on a continuous basis ("Rule 415"), and the
declaration or ordering of effectiveness of such Registration Statement by the
United States Securities and Exchange Commission (the "SEC").

	"Registrable Securities" means the Common Stock
purchased by the Initial Investors or their assignees at the Closing (as defined
in the Securities Purchase Agreement) or any shares of capital stock issued or
issuable, from time to time (with any adjustments), as a distribution on or in
exchange for or otherwise with respect to any of the foregoing, whether as
default payments or otherwise.

	"Registration Statement" means a registration
statement of the Company under the Securities Act.

	Capitalized terms used herein and not otherwise defined
herein shall have the respective meanings set forth in the Securities Purchase
Agreement.

	REGISTRATION.

	Mandatory Registration. The Company shall prepare
promptly and file with the SEC as soon as practicable, but in no event later
than thirty (30) days from the date hereof (the "Filing Date") (as such time may
be extended for the number of days during which any Investor fails to promptly
respond to reasonable written requests from the Company for information to be
included in such filing (which responsive information shall not be deemed to be
prompt in the event that a reasonable request for such information by the
Company is made to the Investors and the Investors do not provide the requested
information within three (3) business days of such request, a Registration
Statement on Form S-3 (or, if Form S-3 is not then available, on such
form of Registration Statement as is then available to effect a registration of
all of the Registrable Securities, subject to the consent, not to be
unreasonably withheld, of the Initial Investors) covering the resale of
1,363,635 Registrable Securities. The Registration Statement filed hereunder, to
the extent allowable under the Securities Act and the rules promulgated
thereunder (including Rule 416), shall state that such Registration Statement
also covers such indeterminate number of additional shares of Common Stock as
may become issuable to prevent dilution resulting from stock splits, stock
dividends or similar transactions. The Registrable Securities included in the
Registration Statement shall be allocated to the Investors as set forth in
Section 11(k) hereof. The Registration Statement (and each amendment or
supplement thereto, and each request for acceleration of effectiveness thereof)
shall be provided to (and subject to the approval of) the Initial Investors and
their counsel prior to its filing or other submission, not to be unreasonably
withheld or delayed.

	Underwritten Offering. If any offering pursuant to
the Registration Statement pursuant to Section 2(a) hereof involves an
underwritten offering, the Investors who hold a majority in interest of the
Registrable Securities subject to such underwritten offering, with the consent
of the Initial Investors if they are still holding Registrable Securities, shall
have the right to select one legal counsel to represent the Investors and an
investment banker or bankers and manager or managers to administer the offering,
which investment banker or bankers or manager or managers shall be reasonably
satisfactory to the Company. In the event that any Investors elect not to
participate in such underwritten offering, the Registration Statement covering
all of the Registrable Securities shall contain appropriate plans of
distribution reasonably satisfactory to the Investors participating in such
underwritten offering and the Investors electing not to participate in such
underwritten offering (including, without limitation, the ability of
nonparticipating Investors to sell from time to time and at any time during the
effectiveness of such Registration Statement). Notwithstanding the foregoing, if
the offering does not involve an underwritten offer, the Investors shall not be
entitled to require that the offering be underwritten.

	Payments by the Company. The Company shall use
commercially reasonable efforts to cause the Registration Statement required to
be filed pursuant to Section 2(a) hereof to become effective as soon as
practicable, but in no event later than the one hundred twentieth (120th) day
following the date hereof. At the time of effectiveness, the Company shall
ensure such Registration Statement covers at least 100% of the Registrable
Securities. If (i) the Registration Statement required to be filed by the
Company pursuant to Section 2(a) hereof is not filed with the SEC prior to the
Filing Date (except to the extent caused by the Investors or their counsel's
failure to reasonably timely respond pursuant to Section 2(a)) or (ii) such
Registration Statement covering all of the Registrable Securities is not
declared effective by the SEC on or before the one hundred twentieth
(120th) day from the date hereof, as extended for delays in excess of
three (3) business days for any Investor's failure to provide information or
approval of filings in a timely manner in accordance with Section 2(a) (the
"Registration Deadline"), then the Company will make payments to the
Investors in such amounts and at such times as shall be determined pursuant to
this Section 2(c) as partial relief for the damages to the Investors by reason
of any such delay in their ability to sell the Registrable Securities (which
remedy shall not be exclusive of any other remedies available at law or in
equity). The Company shall pay to the Investors $2,000 each day (which amount
shall be divided among the Investors on a pro rata basis based on the number of
shares of Common Stock purchased by each Investor pursuant to the Securities
Purchase Agreement) for a consecutive fifteen (15) days (the "Initial Penalty
Period") after the Filing Date and prior to the date the Registration
Statement is filed with the SEC pursuant to Section 2(a). For each thirty (30)
day period (or portion thereof) (each, a "Subsequent Penalty Period") (A)
after the Initial Penalty Period and prior to the date the Registration
Statement is filed with the SEC pursuant to Section 2(a), and (B) after the
Registration Deadline and prior to the date the Registration Statement covering
all of the Registrable Securities is declared effective by the SEC, the Company
shall pay to each Investor an amount equal to the product of (i) the aggregate
purchase price of the Common Stock purchased by such Investor which cannot be
sold under Rule 144 during this time period (the "Aggregate Share
Price"), multiplied by (ii) fifteen thousandths (.015); provided,
however, that there shall be excluded from any Initial Penalty Period or
Subsequent Penalty Period any delays which are solely attributable to changes
(other than corrections of Company mistakes with respect to information
previously provided by the Investors) required by the Investors in the
Registration Statement with respect to information relating to the Investors,
including, without limitation, changes to the plan of distribution, and,
provided further, in no event shall the Company be required to pay such amounts
with respect to both (A) and (B) above for the same period of time. (For
example, if the Registration Statement covering all of the Registrable
Securities is not effective by fifteen (15) days after the Registration
Deadline, in addition to the $30,000 the Company would pay during the Initial
Penalty Period, if applicable, the Company would pay $15,000 for each thirty
(30) day period thereafter with respect to each $1,000,000 of Aggregate Share
Price until the Registration Statement becomes effective.) Such amounts shall be
paid in cash upon demand by the Investors. Payments of cash pursuant hereto
shall be made on the demand of the Investors but in no event later than within
five (5) days after the end of each period that gives rise to such obligation,
provided that, if any such period extends for more than thirty (30) days,
interim payments shall be made for each such thirty (30) day
period. 

	Piggy-Back Registrations. If at any time prior to
the expiration of the Registration Period (as hereinafter defined) and during a
period in which the Registration Statement required to be filed pursuant to
Section 2(a) is not effective, the Company shall file with the SEC a
Registration Statement relating to an offering for its own account or the
account of others under the Securities Act of any of its equity securities
(other than the amendment of a registration statement now on file or
registration statements on solely with respect to shares of common stock issued
or issuable in connection with an equity credit line or similar vehicle,
registration statements on Form S-4 or Form S-8 or their then equivalents
relating to equity securities to be issued solely in connection with any
acquisition of any entity or business or equity securities issuable in
connection with stock option or other employee benefit plans), the Company shall
send to each Investor written notice of such filing and, if within fifteen (15)
days after the date of such notice, such Investor shall so request in writing,
the Company shall include in such Registration Statement all or any part of the
Registrable Securities such Investor requests to be registered, except that if,
in connection with any underwritten public offering, the managing underwriter(s)
thereof shall impose a limitation on the number of shares of Common Stock which
may be included in the Registration Statement because, in such underwriter(s)'
judgment, marketing or other factors dictate such limitation is necessary to
facilitate public distribution, then the Company shall be obligated to include
in such Registration Statement only such limited portion of the Registrable
Securities with respect to which such Investor has requested inclusion hereunder
as the underwriter shall permit. Any exclusion of Registrable Securities shall
be made pro rata among the Investors seeking to include Registrable Securities,
in proportion to the number of Registrable Securities sought to be included by
such Investors; provided, however, that the Company shall not
exclude any Registrable Securities unless the Company has first excluded all
outstanding securities, the holders of which are not contractually entitled to
inclusion of such securities in such Registration Statement or are not
contractually entitled to pro rata inclusion with the Registrable Securities;
and provided, further, however, that, after giving effect
to the immediately preceding proviso, any exclusion of Registrable Securities
shall be made pro rata with holders of other securities having the contractual
right to include such securities in the Registration Statement other than
holders of securities contractually entitled to inclusion of their securities in
such Registration Statement by reason of demand registration rights.
Notwithstanding the foregoing, no such reduction shall reduce the amount of
Registrable Securities included in the registration below twenty-five (25%) of
the total amount of securities included in such registration. No right to
registration of Registrable Securities under this Section 2(d) shall be
construed to limit any registration required under Section 2(a) hereof. If an
offering in connection with which an Investor is entitled to registration under
this Section 2(d) is an underwritten offering, then each Investor whose
Registrable Securities are included in such Registration Statement shall, unless
otherwise agreed by the Company, offer and sell such Registrable Securities in
an underwritten offering using the same underwriter or underwriters and, subject
to the provisions of this Agreement, on the same terms and conditions as other
shares of Common Stock included in such underwritten offering. Notwithstanding
anything to the contrary contained herein, the Investors' rights set forth in
this Section 2(d) shall not apply with respect to any registration statement
filed pursuant to that certain Registration Rights Agreement, dated May 7, 1999,
by and between the Company and Abbott Laboratories.

	Eligibility for Form S-3. The Company represents
and warrants that it meets the requirements for the use of Form S-3 for
registration of the sale by the Initial Investors and any other Investor of the
Registrable Securities and the Company shall file all reports required to be
filed by the Company with the SEC in a timely manner so as to thereafter
maintain such eligibility for the use of Form S-3.

	Rule 416; Notice of Registration Trigger Date. The
Company and the Investors each acknowledge that an indeterminate number of
Registrable Securities shall be registered pursuant to Rule 416 under the
Securities Act so as to include in such Registration Statement any and all
Registrable Securities which may become issuable to prevent dilution resulting
from stock splits, stock dividends or similar transactions (collectively, the
"Rule 416 Securities"). In this regard, the Company agrees to take all
steps necessary to ensure that all Rule 416 Securities are registered pursuant
to Rule 416 under the Securities Act in the Registration Statement and, absent
guidance from the SEC or other definitive authority to the contrary, the Company
shall affirmatively support and not take any action adverse to the position that
the Registration Statements filed hereunder cover all of the Rule 416
Securities. If the Company determines that the Registration Statement(s) filed
hereunder do not cover all of the Rule 416 Securities, the Company shall
immediately provide to each Investor written notice (a "Rule 416 Notice")
setting forth the basis for the Company's position and the authority therefor.
In the event that a Registration Trigger Date (as defined below) occurs, the
Company shall provide each Investor written notice of such Registration Trigger
Date within three (3) business days thereafter. 

	Delay Period. If, at any time prior to the
expiration of the Registration Period (as defined below), in the good faith
reasonable judgment of the Company's Board of Directors, the disposition of
Registrable Securities would require the premature disclosure of material non-public
information which may reasonably be expected to have an adverse effect on
the Company, then the Company shall not be required to maintain the
effectiveness of or amend or supplement the Registration Statement for a period
(a "Disclosure Delay Period") expiring upon the earlier to occur of (i)
the date on which such material information is disclosed to the public or ceases
to be material or (ii) up to ten (10) trading days after the date on which the
Company provides a notice to the Investors under Section 3(f) hereof stating
that the failure to disclose such non-public information causes the prospectus
included in the Registration Statement, as then in effect, to include an untrue
statement of a material fact or to omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading (each,
a "Disclosure Delay Period Notice"). For the avoidance of doubt, in no
event shall a Disclosure Delay Period exceed ten (10) trading days. The Company
will give prompt written notice, in the manner prescribed by Section 11 hereof,
to the Investors of each Disclosure Delay Period. If practicable, such notice
shall estimate the duration of such Disclosure Delay Period. Each Investor
agrees that, upon receipt of a Disclosure Delay Period Notice prior to
Investor's disposition of all such Registrable Securities, Investor will
forthwith discontinue disposition of such Registrable Securities pursuant to the
Registration Statement, and will not deliver any prospectus forming a part
thereof in connection with any sale of such Registrable Securities until the
expiration of such Disclosure Delay Period. In addition, the provisions of
Section 2(c) hereof shall not apply to the Disclosure Delay Periods.
Notwithstanding anything in this Section 2 to the contrary, the Company shall
not deliver more than two (2) Disclosure Delay Period Notices in any three
hundred sixty five (365) day period.

	OBLIGATIONS OF THE COMPANY.

In connection with the registration of the Registrable
Securities, the Company shall have the following obligations:

	The Company shall prepare and file with the SEC the
Registration Statement required by Section 2(a) (but in no event later than the
Filing Date), and cause such Registration Statement relating to Registrable
Securities to become effective as soon as practicable after such filing but in
no event later than the Registration Deadline), and keep such Registration
Statement effective pursuant to Rule 415 at all times until such date as is the
earlier of (i) the date on which all of the Registrable Securities have been
sold and (ii) the date on which all of the Registrable Securities (in the
reasonable opinion of counsel to the Initial Investors, which shall be sought
upon the reasonable request of the Company) may be immediately sold to the
public without registration or restriction pursuant to Rule 144(k) under the
Securities Act or any successor provision (the "Registration Period"),
which Registration Statement (including any amendments or supplements thereto
and prospectuses contained therein and all documents incorporated by reference
therein) shall not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein, or necessary to make the
statements therein not misleading, and (iii) shall comply in all material
respects with the requirements of the Securities Act and the rules and
regulations of the SEC promulgated thereunder. The financial statements of the
Company included in the Registration Statement or incorporated by reference
therein will comply as to form in all material respects with the applicable
accounting requirements and the published rules and regulations of the SEC
applicable with respect thereto. Such financial statements will be prepared in
accordance with U.S. generally accepted accounting principles, consistently
applied, during the periods involved (except (i) as may be otherwise indicated
in such financial statements or the notes thereto, or (ii) in the case of
unaudited interim statements, to the extent they may not include footnotes or
may be condensed on summary statements and fairly present in all material
respects the consolidated financial position of the Company and its consolidated
subsidiaries as of the dates thereof and the consolidated results of their
operations and cash flows for the periods then ended (subject, in the case of
unaudited statements, to immaterial year-end adjustments).

	The Company shall prepare and file with the SEC such
amendments (including post-effective amendments) and supplements to the
Registration Statement and the prospectus used in connection with the
Registration Statement as may be necessary to keep the Registration Statement
effective at all times during the Registration Period, and, during such period,
comply with the provisions of the Securities Act with respect to the disposition
of all Registrable Securities of the Company covered by the Registration
Statement until the earlier of (i) such time as all of such Registrable
Securities have been disposed of in accordance with the intended methods of
disposition by the seller or sellers thereof as set forth in the Registration
Statement or (ii) the expiration of the Registration Period.

	The Company shall furnish to each Investor whose
Registrable Securities are included in the Registration Statement and its legal
counsel (i) promptly after the same is prepared and publicly distributed, filed
with the SEC, or received by the Company, one copy of the Registration Statement
and any amendment thereto, each preliminary prospectus and prospectus and each
amendment or supplement thereto, and, in the case of the Registration Statement
referred to in Section 2(a), each letter written by or on behalf of the Company
to the SEC or the staff of the SEC (including, without limitation, any request
to accelerate the effectiveness of the Registration Statement or amendment
thereto), and each item of correspondence from the SEC or the staff of the SEC,
in each case relating to the Registration Statement (other than any portion, if
any, thereof which contains information for which the Company has sought
confidential treatment), (ii) on the date of effectiveness of the Registration
Statement or any amendment thereto, a notice stating that the Registration
Statement or amendment has been declared effective, and (iii) such number of
copies of a prospectus, including a preliminary prospectus, and all amendments
and supplements thereto and such other documents as such Investor may reasonably
request in order to facilitate the disposition of the Registrable Securities
owned by such Investor.

	The Company shall use reasonable commercial efforts to
(i) register and qualify the Registrable Securities covered by the Registration
Statement under such other securities or "blue sky" laws of such jurisdictions
in the United States as each Investor who holds Registrable Securities being
offered reasonably requests, (ii) prepare and file in those jurisdictions such
amendments (including post-effective amendments) and supplements to such
registrations and qualifications as may be necessary to maintain the
effectiveness thereof during the Registration Period, (iii) take such other
actions as may be necessary to maintain such registrations and qualifications in
effect at all times during the Registration Period, and (iv) take all other
actions reasonably necessary or advisable to qualify the Registrable Securities
for sale in such jurisdictions; provided, however, that the
Company shall not be required in connection therewith or as a condition thereto
to (a) qualify to do business in any jurisdiction where it would not otherwise
be required to qualify but for this Section 3(d), (b) subject itself to general
taxation in any such jurisdiction, (c) file a general consent to service of
process in any such jurisdiction, (d) provide any undertakings that cause the
Company undue expense or burden, or (e) make any change in its charter or
bylaws, which in each case the Board of Directors of the Company determines to
be contrary to the best interests of the Company and its stockholders.

	In the event the Investors who hold a majority in
interest of the Registrable Securities being offered in an offering select
underwriters for the offering, the Company shall enter into and perform its
obligations under an underwriting agreement, in usual and customary form,
including, without limitation, customary indemnification and contribution
obligations, with the underwriters of such offering.

	As promptly as practicable after becoming aware of such
event, the Company shall notify each Investor by telephone and facsimile of the
happening of any event, of which the Company has knowledge, as a result of which
the prospectus included in the Registration Statement, as then in effect,
includes an untrue statement of a material fact or omission to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading, and, use commercially reasonable efforts promptly to prepare a
supplement or amendment to the Registration Statement to correct such untrue
statement or omission, and deliver such number of copies of such supplement or
amendment to each Investor as such Investor may reasonably request.

	The Company shall use commercially reasonable efforts (i)
to prevent the issuance of any stop order or other suspension of effectiveness
of a Registration Statement, and, if such an order is issued, to obtain the
withdrawal of such order at the earliest practicable moment (including in each
case by amending or supplementing such Registration Statement) and (ii) to
notify each Investor who holds Registrable Securities being sold (or, in the
event of an underwritten offering, the managing underwriters) of the issuance of
such order and the resolution thereof (and if such Registration Statement is
supplemented or amended, deliver such number of copies of such supplement or
amendment to each Investor as such Investor may reasonably
request). 

	The Company shall permit a single firm of counsel
designated by the Initial Investors to review the Registration Statement and all
amendments and supplements thereto a reasonable period of time prior to its
filing with the SEC, and not file any document in a form to which such counsel
reasonably objects.

	The Company shall make generally available to its
security holders as soon as practical, but not later than ninety (90) days after
the close of the period covered thereby, an earnings statement (in form
complying with the provisions of Rule 158 under the Securities Act) covering a
twelve-month period beginning not later than the first day of the Company's
fiscal quarter next following the effective date of the Registration
Statement.

	At the request of any Investor in the case of an
underwritten public offering, the Company shall furnish, on the date of
effectiveness of the Registration Statement (i) an opinion, dated as of such
date, from counsel representing the Company addressed to the Investors and in
form, scope and substance as is customarily given in an underwritten public
offering and (ii) a letter, dated such date, from the Company's independent
certified public accountants in form and substance as is customarily given by
independent certified public accountants to underwriters in an underwritten
public offering, addressed to the underwriters, if any, and the
Investors.

	The Company shall make available for inspection by (i)
any Investor, (ii) any underwriter participating in any disposition pursuant to
the Registration Statement, (iii) one firm of attorneys and one firm of
accountants or other agents retained by the Investors, and (iv) one firm of
attorneys retained by all such underwriters (collectively, the
"Inspectors") all pertinent financial and other records, and pertinent
corporate documents and properties of the Company (collectively, the
"Records"), as shall be reasonably deemed necessary by each Inspector to
enable each Inspector to exercise its due diligence responsibility, and cause
the Company's officers, directors and employees to supply all information which
any Inspector may reasonably request for purposes of such due diligence;
provided, however, that each Inspector shall hold in confidence
and shall not make any disclosure (except to an Investor) of any Record or other
information which the Company determines in good faith to be confidential, and
of which determination the Inspectors are so notified, unless (a) the disclosure
of such Records is necessary to avoid or correct a misstatement or omission in
any Registration Statement (a final determination of which shall be based upon
an opinion of outside counsel to the Company), (b) the release of such Records
is ordered pursuant to a subpoena or other order from a court or government body
of competent jurisdiction, or (c) the information in such Records has been made
generally available to the public other than by disclosure in violation of this
or any other agreement. The Company shall not be required to disclose any
confidential information in such Records to any Inspector until and unless such
Inspector shall have entered into confidentiality agreements (in form and
substance satisfactory to the Company) with the Company with respect thereto,
substantially in the form of this Section 3(k). Each Investor agrees that it
shall, upon learning that disclosure of such Records is sought in or by a court
or governmental body of competent jurisdiction or through other means, give
prompt notice to the Company and allow the Company, at its expense, to undertake
appropriate action to prevent disclosure of, or to obtain a protective order
for, the Records deemed confidential. Nothing herein shall be deemed to limit
the Investors' ability to sell Registrable Securities in a manner which is
otherwise consistent with applicable laws and regulations. 

	The Company shall hold in confidence and not make any
disclosure of information concerning an Investor provided to the Company which
was clearly indicated in writing as "confidential" at the time of its delivery
unless (i) disclosure of such information is necessary to comply with federal or
state securities laws, (ii) the disclosure of such information is necessary to
avoid or correct a misstatement or omission in any Registration Statement, (iii)
the release of such information is ordered pursuant to a subpoena or other order
from a court or governmental body of competent jurisdiction, (iv) such
information has been made generally available to the public other than by
disclosure in violation of this or any other agreement, or (v) such Investor
consents to the form and content of any such disclosure. The Company agrees that
it shall, upon learning that disclosure of such information concerning an
Investor is sought in or by a court or governmental body of competent
jurisdiction or through other means, give prompt notice to such Investor prior
to making such disclosure, and allow the Investor, at its expense, to undertake
appropriate action to prevent disclosure of, or to obtain a protective order
for, such information.

	The Company shall use commercially reasonable efforts to
promptly either (i) cause all of the Registrable Securities covered by the
Registration Statement to be listed on the NNM, NYSE or the AMEX or another
national securities exchange and on each additional national securities exchange
on which securities of the same class or series issued by the Company are then
listed, if any, if the listing of such Registrable Securities is then permitted
under the rules of such exchange, or (ii) secure the designation and quotation
of all of the Registrable Securities covered by the Registration Statement on
the NNM or SmallCap and, without limiting the generality of the foregoing, to
arrange for or maintain at least two market makers to register with the National
Association of Securities Dealers, Inc. ("NASD") as such with respect to
such Registrable Securities.

	The Company shall provide a transfer agent and registrar,
which may be a single entity, for the Registrable Securities not later than the
effective date of the Registration Statement.

	The Company shall cooperate with the Investors who hold
Registrable Securities being offered and the managing underwriter or
underwriters, if any, to facilitate the timely preparation and delivery of
certificates (not bearing any restrictive legends) representing Registrable
Securities to be offered pursuant to the Registration Statement and enable such
certificates to be in such denominations or amounts, as the case may be, as the
managing underwriter or underwriters, if any, or the Investors may reasonably
request and registered in such names as the managing underwriter or
underwriters, if any, or the Investors may request, and, within three (3)
business days after the Registration Statement which includes Registrable
Securities is ordered effective by the SEC, the Company shall deliver, and shall
cause legal counsel selected by the Company to deliver, to the transfer agent
for the Registrable Securities (with copies to the Investors whose Registrable
Securities are included in such Registration Statement), an opinion of such
counsel in the form attached hereto as Exhibit 1. 

	At the request of any Investor, the Company shall prepare
and file with the SEC such amendments (including post-effective amendments) and
supplements to a Registration Statement and the prospectus used in connection
with such Registration Statement as may be necessary in order to change the plan
of distribution set forth in such Registration Statement.

	The Company shall comply with all applicable laws related
to a Registration Statement and offering and sale of securities and all
applicable rules and regulations of governmental authorities in connection
therewith (including, without limitation, the Securities Act and the Securities
Exchange Act of 1934, as amended, and the rules and regulations promulgated by
the SEC.)

	From and after the date of this Agreement, the Company
shall not, and shall not agree to, allow the holders of any securities of the
Company to include any of their securities which are not Registrable Securities
in the Registration Statement under Section 2(a) hereof or any amendment or
supplement thereto under Section 3(b) hereof without the consent of the holders
of a majority in interest of the Registrable Securities.

	OBLIGATIONS OF THE INVESTORS.

In connection with the registration of the Registrable
Securities, the Investors shall have the following obligations:

	It shall be a condition precedent to the obligations of
the Company to complete the registration pursuant to this Agreement with respect
to the Registrable Securities of a particular Investor that such Investor shall
furnish to the Company such information regarding itself, the Registrable
Securities held by it and the intended method of disposition of the Registrable
Securities held by it as shall be reasonably required to effect the registration
of such Registrable Securities and shall execute such documents in connection
with such registration as the Company may reasonably request. At least five
trading days prior to the first anticipated filing date of the Registration
Statement, the Company shall notify each Investor of the information the Company
requires from each such Investor. 

	Each Investor, by such Investor's acceptance of the
Registrable Securities, agrees to cooperate with the Company as reasonably
requested by the Company in connection with the preparation and filing of the
Registration Statement hereunder, unless such Investor has notified the Company
in writing of such Investor's election to exclude all of such Investor's
Registrable Securities from such Registration Statement.

	In the event Investors holding a majority in interest of
the Registrable Securities being offered determine to engage the services of an
underwriter, each Investor agrees to enter into and perform such Investor's
obligations under an underwriting agreement, in usual and customary form,
including, without limitation, customary indemnification and contribution
obligations, with the underwriter(s) of such offering and the Company and take
such other actions as are reasonably required in order to expedite or facilitate
the disposition of the Registrable Securities, unless such Investor has notified
the Company in writing of such Investor's election not to participate in such
underwritten distribution.

	Each Investor agrees that, upon receipt of any notice
from the Company of the happening of any event of the kind described in Sections
3(f) or 3(g), such Investor will immediately discontinue disposition of
Registrable Securities pursuant to the Registration Statement covering such
Registrable Securities until such Investor's receipt of the copies of the
supplemented or amended prospectus contemplated by Sections 3(f) or 3(g) and, if
so directed by the Company, such Investor shall deliver to the Company (at the
expense of the Company) or destroy (and deliver to the Company a certificate of
destruction) all copies in such Investor's possession, of the prospectus
covering such Registrable Securities current at the time of receipt of such
notice.

	No Investor may participate in any underwritten
distribution hereunder unless such Investor (i) agrees to sell such Investor's
Registrable Securities on the basis provided in any underwriting arrangements in
usual and customary form entered into by the Company, (ii) completes and
executes all questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents reasonably required under the terms of such
underwriting arrangements, (iii) agrees to pay its pro rata share of all
underwriting discounts and commissions and any expenses in excess of those
payable by the Company pursuant to Section 5 below, and (iv) complies with all
applicable laws in connection therewith. Notwithstanding anything in this
Section 4(e) to the contrary, this Section 4(e) is not intended to limit an
Investor's rights under Sections 2(a) or 3(b) hereof.

	EXPENSES OF REGISTRATION. All reasonable expenses
incurred by the Company or the Investors in connection with registrations,
filings or qualifications pursuant to Sections 2 and 3 above, including, without
limitation, all registration, listing and qualifications fees, printers and
accounting fees, the fees and disbursements of counsel for the Company and the
reasonably incurred fees and disbursements of one counsel selected by the
Investors (not to exceed $7,500) shall be borne by the Company. In addition, the
Company shall pay all of the Investors' costs and expenses (including legal
fees) incurred in connection with the enforcement of the rights of the Investors
hereunder.

	INDEMNIFICATION. In the event any Registrable
Securities are included in a Registration Statement under this
Agreement:

	To the extent permitted by law, the Company will
indemnify, hold harmless and defend (i) each Investor who holds such Registrable
Securities, and (ii) the directors, officers, partners, members, employees
and agents of such Investor and each person who controls any Investor within the
meaning of Section 15 of the Securities Act or Section 20 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), if any, (each, an
"Indemnified Person"), against any joint or several losses, claims,
damages, liabilities or expenses (collectively, together with actions,
proceedings or inquiries by any regulatory or self-regulatory organization,
whether commenced or threatened, in respect thereof, "Claims") to which
any of them may become subject insofar as such Claims arise out of or are based
upon: (i) any untrue statement or alleged untrue statement of a material fact in
a Registration Statement or the omission or alleged omission to state therein a
material fact required to be stated or necessary to make the statements therein
not misleading, (ii) any untrue statement or alleged untrue statement of a
material fact contained in any preliminary prospectus if used prior to the
effective date of such Registration Statement, or contained in the final
prospectus (as amended or supplemented, if the Company files any amendment
thereof or supplement thereto with the SEC) or the omission or alleged omission
to state therein any material fact necessary to make the statements made
therein, in light of the circumstances under which the statements therein were
made, not misleading, or (iii) any violation or alleged violation by the Company
of the Securities Act, the Exchange Act, any other law, including, without
limitation, any state securities law, or any rule or regulation thereunder
relating to the offer or sale of the Registrable Securities (the matters in the
foregoing clauses (i) through (iii) being, collectively, "Violations").
Subject to the restrictions set forth in Section 6(c) with respect to the number
of legal counsel, the Company shall reimburse the Investors and each other
Indemnified Person, promptly as such expenses are incurred and are due and
payable, for any reasonable legal fees or other reasonable expenses incurred by
them in connection with investigating or defending any such Claim.
Notwithstanding anything to the contrary contained herein, the indemnification
agreement contained in this Section 6(a): (i) shall not apply to a Claim arising
out of or based upon a Violation which occurs in reliance upon and in conformity
with information furnished in writing to the Company by such Indemnified Person
expressly for use in the Registration Statement or any such amendment thereof or
supplement thereto; (ii) shall not apply to amounts paid in settlement of any
Claim if such settlement is effected without the prior written consent of the
Company, which consent shall not be unreasonably withheld; and (iii) with
respect to any preliminary prospectus, shall not inure to the benefit of any
Indemnified Person if the untrue statement or omission of material fact
contained in the preliminary prospectus was corrected on a timely basis in the
prospectus, as then amended or supplemented, if such corrected prospectus was
timely made available by the Company pursuant to Section 3(c) hereof, and the
Indemnified Person was promptly advised in writing not to use the incorrect
prospectus prior to the use giving rise to a Violation and such Indemnified
Person, notwithstanding such advice, used it. Such indemnity shall remain in
full force and effect regardless of any investigation made by or on behalf of
the Indemnified Person and shall survive the transfer of the Registrable
Securities by the Investors pursuant to Section 9 hereof.

	In connection with any Registration Statement in which an
Investor is participating, each such Investor agrees severally and not jointly
to indemnify, hold harmless and defend, to the same extent and in the same
manner set forth in Section 6(a), the Company, each of its directors, each of
its officers who signs the Registration Statement, its employees, agents and
each person, if any, who controls the Company within the meaning of Section 15
of the Securities Act or Section 20 of the Exchange Act, and any other
stockholder selling securities pursuant to the Registration Statement or any of
its directors or officers or any person who controls such stockholder within the
meaning of the Securities Act or the Exchange Act (collectively and together
with an Indemnified Person, an "Indemnified Party"), against any Claim to
which any of them may become subject, under the Securities Act, the Exchange Act
or otherwise, insofar as such Claim arises out of or is based upon any
Violation, in each case to the extent (and only to the extent) that such
Violation occurs in reliance upon and in conformity with written information
furnished to the Company by such Investor expressly for use in connection with
such Registration Statement; and subject to Section 6(c) such Investor will
reimburse any legal or other expenses (promptly as such expenses are incurred
and are due and payable) reasonably incurred by them in connection with
investigating or defending any such Claim; provided, however, that the
indemnity agreement contained in this Section 6(b) shall not apply to amounts
paid in settlement of any Claim if such settlement is effected without the prior
written consent of such Investor, which consent shall not be unreasonably
withheld; provided, further, however, that the Investor
shall be liable under this Agreement (including this Section 6(b) and Section 7)
for only that amount as does not exceed the net proceeds actually received by
such Investor as a result of the sale of Registrable Securities pursuant to such
Registration Statement. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of such Indemnified Party
and shall survive the transfer of the Registrable Securities by the Investors
pursuant to Section 9 hereof. Notwithstanding anything to the contrary contained
herein, the indemnification agreement contained in this Section 6(b) with
respect to any preliminary prospectus shall not inure to the benefit of any
Indemnified Party if the untrue statement or omission of material fact contained
in the preliminary prospectus was corrected on a timely basis in the prospectus,
as then amended or supplemented.

	Promptly after receipt by an Indemnified Person or
Indemnified Party under this Section 6 of notice of the commencement of any
action (including any governmental action), such Indemnified Person or
Indemnified Party shall, if a Claim in respect thereof is to made against any
indemnifying party under this Section 6, deliver to the indemnifying party a
written notice of the commencement thereof, and the indemnifying party shall
have the right to participate in, and, to the extent the indemnifying party so
desires, jointly with any other indemnifying party similarly noticed, to assume
control of the defense thereof with counsel mutually satisfactory to the
indemnifying party and the Indemnified Person or the Indemnified Party, as the
case may be; provided, however, that such indemnifying party shall
not be entitled to assume such defense and an Indemnified Person or Indemnified
Party shall have the right to retain its own counsel with the fees and expenses
to be paid by the indemnifying party, if, in the reasonable opinion of counsel
retained by the indemnifying party, the representation by such counsel of the
Indemnified Person or Indemnified Party and the indemnifying party would be
inappropriate due to actual or potential conflicts of interest between such
Indemnified Person or Indemnified Party and any other party represented by such
counsel in such proceeding or the actual or potential defendants in, or targets
of, any such action include both the Indemnified Person or the Indemnified Party
and the indemnifying party and any such Indemnified Person or Indemnified Party
reasonably determines that there may be legal defenses available to such
Indemnified Person or Indemnified Party which are in conflict with those
available to such indemnifying party. The indemnifying party shall pay for only
one separate legal counsel for the Indemnified Person or the Indemnified
Parties, as applicable, and such legal counsel shall be selected by Investors
holding a majority-in-interest of the Registrable Securities included in the
Registration Statement to which the Claim relates (with the approval of the
Initial Investor if it holds Registrable Securities included in such
Registration Statement), if the Investors are entitled to indemnification
hereunder, or by the Company, if the Company is entitled to indemnification
hereunder, as applicable. The failure to deliver written notice to the
indemnifying party within a reasonable time of the commencement of any such
action shall not relieve such indemnifying party of any liability to the
Indemnified Person or Indemnified Party under this Section 6, except to the
extent that the indemnifying party is actually prejudiced in its ability to
defend such action. The indemnification required by this Section 6 shall be made
by periodic payments of the amount thereof during the course of the
investigation or defense, as such expense, loss, damage or liability is incurred
and is due and payable.

	CONTRIBUTION. To the extent any indemnification by
an indemnifying party is prohibited or limited by law, the indemnifying party
agrees to make the maximum contribution with respect to any amounts for which it
would otherwise be liable under Section 6 to the fullest extent permitted by law
as is appropriate to reflect the relative fault of the indemnifying party, on
the one hand, and the Indemnified Person or Indemnified Party, as the case may
be, on the other hand, with respect to the Violation giving rise to the
applicable Claim; provided, however, that (i) no contribution
shall be made under circumstances where the maker would not have been liable for
indemnification under the fault standards set forth in Section 6, (ii) no person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any seller of
Registrable Securities who was not guilty of such fraudulent misrepresentation,
and (iii) contribution (together with any indemnification or other obligations
under this Agreement) by any seller of Registrable Securities shall be limited
in amount to the net amount of proceeds received by such seller from the sale of
such Registrable Securities.

	REPORTS UNDER THE EXCHANGE ACT. With a view to
making available to the Investors the benefits of Rule 144 promulgated under the
Securities Act or any other similar rule or regulation of the SEC that may at
any time permit the Investors to sell securities of the Company to the public
without registration ("Rule 144"), the Company agrees to:

	file with the SEC in a timely manner and make and keep
available all reports and other documents required of the Company under the
Securities Act and the Exchange Act so long as the Company remains subject to
such requirements (it being understood that nothing herein shall limit the
Company's obligations under Section 4(c) of the Securities Purchase Agreement)
and the filing and availability of such reports and other documents is required
for the applicable provisions of Rule 144; and

	furnish to each Investor so long as such Investor owns
Shares or Registrable Securities, promptly upon request, (i) a written statement
by the Company that it has complied with the reporting requirements of Rule 144,
the Securities Act and the Exchange Act, (ii) a copy of the most recent annual
or quarterly report of the Company and such other reports and documents so filed
by the Company, and (iii) such other information as may be reasonably requested
to permit the Investors to sell such securities under Rule 144 without
registration.

	ASSIGNMENT OF REGISTRATION RIGHTS. The rights of
the Investors hereunder, including the right to have the Company register
Registrable Securities pursuant to this Agreement, shall be automatically
assignable by each Investor to any transferee of 100,000 or more of the Shares
(as adjusted for any stock split, stock dividend, recapitalization,
reorganization or otherwise) the Registrable Securities, or any assignee of the
Securities Purchase Agreement if: (i) the Investor agrees in writing with the
transferee or assignee to assign such rights, and a copy of such agreement is
furnished to the Company after such assignment, (ii) the Company is furnished
with written notice of (a) the name and address of such transferee or assignee,
and (b) the securities with respect to which such registration rights are being
transferred or assigned, (iii) following such transfer or assignment, the
further disposition of such securities by the transferee or assignee is
restricted under the Securities Act and applicable state securities laws, (iv)
the transferee or assignee agrees in writing for the benefit of the Company to
be bound by all of the provisions contained herein, and (v) such transfer shall
have been made in accordance with the applicable requirements of the Securities
Purchase Agreement. In addition, and notwithstanding anything to the contrary
contained in this Agreement, the Shares may be pledged, and all rights of the
Investors under this Agreement or any other agreement or document related to the
transactions contemplated hereby may be assigned, without further consent of the
Company, to a bona fide pledgee in connection with an Investor's margin or
brokerage account.

	AMENDMENT OF REGISTRATION RIGHTS. Provisions of
this Agreement may be amended and the observance thereof may be waived (either
generally or in a particular instance and either retroactively or
prospectively), only with written consent of the Company and Investors who hold
a majority in interest of the Registrable Securities or, in the case of a
waiver, with the written consent of the party charged with the enforcement of
any such provision; provided, however, that no consideration shall
be paid to an Investor by the Company in connection with an amendment hereto
unless each Investor similarly affected by such amendment receives a pro-rata
amount of consideration from the Company. Unless an Investor otherwise agrees,
each amendment hereto must similarly affect each Investor. Any amendment or
waiver effected in accordance with this Section 10 shall be binding upon each
Investor and the Company.

	MISCELLANEOUS.

	A person or entity is deemed to be a holder of
Registrable Securities whenever such person or entity owns of record such
Registrable Securities. If the Company receives conflicting instructions,
notices or elections from two or more persons or entities with respect to the
same Registrable Securities, the Company shall act upon the basis of
instructions, notice or election received from the registered owner of such
Registrable Securities.

	Any notices required or permitted to be given under the
terms of this Agreement shall be sent by certified or registered mail (return
receipt requested) or delivered personally or by courier or by confirmed
telecopy, and shall be effective five (5) days after being placed in the mail,
if mailed, or upon receipt or refusal of receipt, if delivered personally or by
courier or confirmed telecopy, in each case addressed to a party. The addresses
for such communications shall be:

	
If to the Company:

	
 

	
SangStat Medical Corporation

                   6300 Dumbarton Circle

                   Fremont, California  94555

                   Facsimile:  (510)-789-4493

                   Attn:  General Counsel

	
with a copy simultaneously transmitted by like means to:

	
 

	
Gray Cary Ware & Friedenrich

                   4365 Executive Drive, Suite 1600

                   San Diego, California  92121

                  Facsimile:  (858) 677-1477

                   Attn:  Paul B. Johnson, Esquire

and if to any Investor, at such address as such Investor
shall have provided in writing to the Company, or at such other address as each
such party furnishes by notice given in accordance with this Section 11(b).

	Failure of any party to exercise any right or remedy
under this Agreement or otherwise, or delay by a party in exercising such right
or remedy, shall not operate as a waiver thereof.

	This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware applicable to contracts made
and to be performed in the State of Delaware. The Company and each Investor
irrevocably consents to the jurisdiction of the United States federal courts and
the state courts located in the State of Delaware in any suit or proceeding
based on or arising under this Agreement and irrevocably agrees that all claims
in respect of such suit or proceeding may be determined in such courts. The
Company and each Investor irrevocably waives the defense of an inconvenient
forum to the maintenance of such suit or proceeding. The parties further agree
that service of process upon the other party, mailed by first class mail shall
be deemed in every respect effective service of process upon such party in any
such suit or proceeding. Nothing herein shall affect the parties' right to serve
process in any other manner permitted by law. Each party agrees that a final
non-appealable judgment in any such suit or proceeding shall be conclusive and
may be enforced in other jurisdictions by suit on such judgment or in any other
lawful manner.

	This Agreement and the Securities Purchase Agreement
(including all schedules and exhibits thereto) constitute the entire agreement
among the parties hereto with respect to the subject matter hereof and thereof.
There are no restrictions, promises, warranties or undertakings, other than
those set forth or referred to herein and therein. This Agreement and the
Securities Purchase Agreement supersede all prior agreements and understandings
among the parties hereto with respect to the subject matter hereof and
thereof.

	Subject to the requirements of Section 9 hereof, this
Agreement shall inure to the benefit of and be binding upon the successors and
assigns of each of the parties hereto.

	The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning
hereof.

	This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of which shall
constitute one and the same agreement. This Agreement, once executed by a party,
may be delivered to the other party hereto by facsimile transmission of a copy
of this Agreement bearing the signature of the party so delivering this
Agreement.

	Each party shall do and perform, or cause to be done and
performed, all such further acts and things, and shall execute and deliver all
such other agreements, certificates, instruments and documents, as the other
party may reasonably request in order to carry out the intent and accomplish the
purposes of this Agreement and the consummation of the transactions contemplated
hereby.

	All consents, approvals and other determinations to be
made by the Investors pursuant to this Agreement shall be made by the Investors
holding a majority in interest of the Registrable Securities held by all
Investors.

	The initial number of Registrable Securities included on
any Registration Statement and each increase to the number of Registrable
Securities included thereon shall be allocated pro rata among the Investors
based on the number of Registrable Securities held by each Investor at the time
of such establishment or increase, as the case may be. In the event an Investor
shall sell or otherwise transfer any of such holder's Registrable Securities,
each transferee shall be allocated a pro rata portion of the number of
Registrable Securities included on a Registration Statement for such transferor.
Any shares of Common Stock included on a Registration Statement and which remain
allocated to any person or entity which does not hold any Registrable Securities
shall be allocated to the remaining Investors pro rata based on the number of
shares of Registrable Securities then held by such Investors.

	Each party to this Agreement has participated in the
negotiation and drafting of this Agreement. As such, the language used herein
shall be deemed to be the language chosen by the parties hereto to express their
mutual intent, and no rule of strict construction will be applied against any
party to this Agreement.

	For purposes of this Agreement, the term "business day"
means any day other than a Saturday or Sunday or a day on which banking
institutions in the State of New York are authorized or obligated by law,
regulation or executive order to close, and the term "trading day" means any day
on which NASDAQ or, if the Common Stock is not then traded on NASDAQ, the
principal securities exchange or trading market where the Common Stock is then
listed or traded, is open for trading. 

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

SANGSTAT MEDICAL CORPORATION

By: /s/ Jean-Jacques Bienaimé

Name:Jean-Jacques Bienaimé

Its:Chairman, CEO & President

PURCHASERS:

NARRAGANSETT I, LP

 

By: /s/ Joseph L. Dowling III

Name: Joseph L. Dowling III

Its: Managing Member

NARRAGANSETT OFFSHORE, LTD.

 

By: /s/ Joseph L. Dowling III

Name: Joseph L. Dowling III

Its: Managing Member

ROYAL BANK OF CANADA

by its agent RBC Dominion Securities Corporation

 

By:/s/ Mark A. Standish

Name:Mark A. Standish

Its:Managing Director

 

By:/s/ Steven C. Miller

Name:Steven C. Miller

Its:Managing Director

S.A.C. CAPITAL ASSOCIATES, LLC

by S.A.C. Capital Advisors, LLC

By:/s/ Peter Nussbaum

Name:Peter Nussbaum

Its:General Counsel 

SOCIÉTÉ GÉNÉRALE

 

 

 

By:______________________________

Name: Guillaume Pollet

Title: Managing Director

[Date]

[Name and address

of transfer agent]

RE:SANGSTAT MEDICAL CORPORATION

Ladies and Gentlemen:

We are counsel to SangStat Medical Corporation, a corporation
organized under the laws of the State of Delaware (the "Company"), and we
understand that [Name of Investor] (the "Holder") has purchased from the
Company shares of the Company's Common Stock. Pursuant to a Registration Rights
Agreement, dated as of June     , 2001, by and
among the Company and the signatories thereto (the "Registration Rights
Agreement"), the Company agreed with the Holder, among other things, to
register the Registrable Securities (as that term is defined in the Registration
Rights Agreement) under the Securities Act of 1933, as amended (the
"Securities Act"), upon the terms provided in the Registration Rights
Agreement. In connection with the Company's obligations under the Registration
Rights Agreement, on __________, 200_, the Company filed a Registration
Statement on Form S-___ (File No. 333- _____________) (the "Registration
Statement") with the Securities and Exchange Commission (the "SEC")
relating to the Registrable Securities, which names the Holder as a selling
stockholder thereunder. The Registration Statement was declared effective by the
SEC on _____________, 200_.

[Other customary introductory and scope of examination
language to be inserted]

Based on the foregoing, we are of the opinion that the
Registrable Securities have been registered under the Securities Act.

[Other customary language to be included.]
Very truly yours,

 

 

cc:[Name of Investor]<PAGE>   1

                                                                  EXHIBIT 10.35

                                                AMENDMENT NO. 1 dated as of
                                       March 1, 2001 (this "Amendment") to the
                                       PLEDGE AGREEMENT dated as of May 31,
                                       2000, (the "Original Agreement"), among
                                       PLIANT CORPORATION, a Utah corporation
                                       f/k/a Huntsman Packaging Corporation (the
                                       "Company") and RICHARD P. DURHAM (the
                                       "Pledgor").

         By executing and by delivering this Amendment, the undersigned hereby
agree as set forth below. Capitalized terms used but not defined herein shall
have the respective meanings ascribed to them in the Original Agreement.

1.1      AMENDMENTS.

         The Original Agreement is hereby amended to add the following new
section:

         "Section 13.  Exclusive Remedies.

                  Notwithstanding anything to the contrary contained herein, the
                  Company's sole recourse with respect to the obligations under
                  the Note shall be pursuant to its rights hereunder and the
                  Company shall have no recourse against the Executive
                  personally for any deficiency under the Note which remains
                  after the exercise of all of its rights hereunder and
                  application of the proceeds of any sale or disposition
                  pursuant to the terms of this Agreement."

1.2      NO OTHER AMENDMENTS OR WAIVERS.

         Except as modified by this Amendment, the Original Agreement shall
remain in full force and effect, enforceable in accordance with its terms.

1.3      COUNTERPARTS.

         This Amendment may be executed in any number of counterparts, and each
such counterpart shall be deemed to be an original instrument, but all such
counterparts together shall constitute one agreement.

1.4      GOVERNING LAW.

         This Amendment shall be governed by and construed and enforced in
accordance with the laws of the State of Utah without giving effect to any
choice or conflict of law provision or rule (whether in the State of Utah or any
other jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of Utah.

                                     *******
<PAGE>   2
         IN WITNESS WHEREOF, the parties have duly executed this Amendment No.1
to the Pledge Agreement as of the date first above written.

                                PLIANT CORPORATION

                                By:   /s/ Richard P. Durham
                                   ------------------------------------
                                       Name:  Richard P. Durham
                                       Title:    Chairman of the Board

                                   /s/ Richard P. Durham
                                ---------------------------------------
                                Richard P. Durham

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