THE CORPORATE LIBRARY

Related Party Transactions and Outside Related Director Information

VNUS Medical Technologies, Inc. (VNUS)

4/14/2006 Proxy Information

The Company has entered into an agreement with former holders of the Company’s preferred stock, including entities affiliated with some of the directors and holders of 5% or more of the Company’s voting securities, whereby the Company has granted them registration rights with respect to their shares of Common Stock that were issued upon conversion of their preferred stock. In particular, beginning in April 2005, certain holders of approximately 6,700,000 shares of Common Stock or their transferees, including the holders of shares of Common Stock issuable upon the exercise of outstanding warrants, will have the right to require the Company to effect a registration under the Securities Act of 1933, as amended, with respect to shares of registrable securities having an expected aggregate offering price of at least $10 million. Within 10 days of the receipt of such request for registration, the Company is required to notify all of the holders of registrable securities and allow them the chance to participate in the registration. Generally, these registration rights include the following:

• Two demand registration rights, which require the Company to register sales of such holders’ shares so long as such shares have an expected aggregate offering price of at least $10 million, subject to the discretion of the Board of Directors to delay the registration for up to 120 days not more than once in any 12-month period and subject to the Company’s right to refuse the registration request if the Company has effected a registration statement within the last three months.

• An unlimited number of piggyback registration rights, which requires the Company to register sales of a holder’s shares when the Company undertakes a public offering other than in connection with (a) a registration relating solely to employee benefit plans, (b) a registration relating to a Rule 145 transaction or (c) the investors’ demand registration rights noted above. However, the managing underwriter, if any, of any such offering has the right to limit the number of the registrable securities proposed to be included in such registration. The managing underwriter will not have the right, however, to limit the number of such holders’ registrable securities to less than 25% of the total number of securities proposed to be included in such registration.

• Following the Company’s eligibility to register shares on Form S-3, holders of registration rights may require the Company to register sales of shares on Form S-3 up to two times if the holders request registration of the sale of more than $1 million of Common Stock, subject to the discretion of the Board of Directors to delay the registration for a period not to exceed 90 days not more than once in any 12-month period.

The Company will bear all registration expenses if these registration rights are exercised, other than underwriting discounts and commissions.