Sample Business Contracts


Patent License Agreement - Massachusetts Institute of Technology and Cheung Laboratories Inc.


                     MASSACHUSETTS INSTITUTE OF TECHNOLOGY

                                       and
                            CHEUNG LABORATORIES, INC.
                            PATENT LICENSE AGREEMENT

                 M.I.T.'S OFFER TO CHEUNG LABORATORIES, INC. TO
              ENTER INTO THIS LICENSE AGREEMENT SHALL EXTEND UNTIL
                         NO LATER THAN OCTOBER 31, 1997
                                       ----------------
                                   (EXCLUSIVE)

                                       i

<PAGE>






S.

11-7-94
Patent Exclusive

                                TABLE OF CONTENTS
                                -----------------


table of contents........................................................ii

WITNESSETH ...............................................................3

   1  DEFINITIONS ........................................................4

   2    GRANT.............................................................7

   3    DUE DILIGENCE.....................................................9

   4    ROYALTIES........................................................11

   5  REPORTS AND RECORDS ...............................................13

   6  PATENT PROSECUTION ................................................14

   7  IINFRINGEMENT......................................................15

   8  PRODUCT LIABILITY .................................................16

   9  EXPORT CONTROLS ...................................................17

   10 NON-USE OF NAMES ..................................................17

   11 ASSIGNMENT.........................................................18

   12 DISPUTE RESOLUTION ................................................18

   13 TERMINATION........................................................18

   14 PAYMENTS, NOTICES..................................................20

   15 MISCELLANEOUS
      PROVISIONS.........................................................20

   APPENDIX A............................................................22

   APPENDIX B............................................................23

   APPENDIX C............................................................24

   ADDENDUM A ...........................................................25

   ATTACHMENT A .........................................................28

                                       ii
<PAGE>






                     MASSACHUSETTS INSTITUTE OF TECHNOLOGY

                                       and
                            CHEUNG LABORATORIES, INC.

                            PATENT LICENSE AGREEMENT
                            ------------------------

          This Agreement is made and entered into this 24th day of October 1997,
(the "EFFECTIVE DATE") by and between MASSACHUSETTS  INSTITUTE OF TECHNOLOGY,  a
corporation  duly organized and existing under the laws of the  Commonwealth  of
Massachusetts  and  having  its  principal  office at 77  Massachusetts  Avenue,
Cambridge,  Massachusetts 02139, U.S.A.  (hereinafter  referred to as "M.I.T."),
and CHEUNG  LABORATORIES,  INC., a corporation  duly organized under the laws of
Maryland and having its principal office at 10220-I Old Columbia Road, Columbia,
MD 21046-1705 (hereinafter referred to as "LICENSEE"),  and cancels,  supersedes
and replaces a previous  Agreement by and between M.I.T. and LICENSEE for M.I.T.
Case No.'s 5493L, 5672L, and 6512L dated June 12, 1996.

                                   WITNESSETH
                                   ----------

          WHEREAS,  M.I.T.  is the  owner of  certain  PATENT  RIGHTS  (as later
defined herein) relating to M.I.T.  Case No. 5493L,  U.S. Patent No.  5,251,645,
"Adaptive  Hyperthermia  System,"  by Alan  J.  Fenn;  M.I.T.  Case  No.  5672L,
"Non-Invasive  Monopole  Hyperthermia,  Array for Brain Tumor Heating by Alan J.
Fenn;  M.I.T. Case No. 6572L,  U.S. Patent No.  5,540,737,  "Minimally  Invasive
Monopole Phased Array Hyperthermia  Applicators for Treating Carcinoma," by Alan
J. Fenn; and M.I.T. Case No. 7615L,  "Adaptive Nulling And Focusing Hyperthermia
Phased Arrays For Activating  Thermosensitive Liposomes For Targeted Delivery Of
Drugs  To Deep  Human  Tissues,"  by Alan J.  Fenn  and has the  right  to grant
licencses  under said PATENT RIGHTS (as later defined  herein),  subject only to
royalty-free,nonexclusive  license  heretofore  granted  to  the  United  States
Government;

          WHEREAS,  M.I.T.  desires  to have the  PATENT  RIGHTS  developed  and
commercialized  to  benefit  the  public  and is  willing  to  grant  a  license
thereunder,

          WHEREAS,  M.I.T. is the owner of certain rights,  tite and interest in
the PROGRAM  (as later  defined  herein)  relating  to M.I.T.  Case No.  7299LS,
"NULLGSC," by Alan J. Fenn and M.I.T.  Case No.  7298LS,  "FOCUSGSC," by Alan J.
Fenn subject only to the royalty-free, nonexclusive license rights of the United
States  Government  pursuant to 48 CFR 52.227-14  (Civilian  Agencies) and DFARS
252.227-7013 (Defense Agencies), and has the right to grant licenses thereunder;

          WHEREAS,   M.I.T.   desires  to  have  the   PROGRAM   developed   and
commercialized  to  benefit  the  public  and is  willing  to  grant  a  license
thereunder;

                                       1
<PAGE>


          WHEREAS,  M.I.T. and LICENSEE had entered into a License Agreement for
M.I.T. Case No.'s 5493L,  5672L,  6512L,  7298LS and 7299LS dated June 12, 1996,
and now wish to terminate that Agreement and replace it with this Agreement; and

          WHEREAS, LICENSEE has represented to M.I.T., to induce M.I.T. to enter
into  this  Agreement,   that  LICENSEE  is  experienced  in  the   development,
production,  manufacture, marketing and sale of products similar to the LICENSED
PRODUCT(s) (as later defined herein) and/or the use of the LICENSED  PROCESS(es)
(as  later  defined  herein)  and that it shall  commit  itself  to a  thorough,
vigorous  and  diligent  program  of  exploiting  the  PATENT  RIGHTS,  and to a
thorough,  vigorous  and diligent  program of  exploiting  the PROGRAM,  so that
public  utilization shall result therefrom,  all in the manner  provided herein;
and

          WHEREAS,  LICENSEE desires to obtain a license under the PATENT RIGHTS
and also  desires  to  obtain a  license  to the  PROGRAM,  upon the  terms  and
conditions hereinafter set forth.

          NOW, THEREFORE, in consideration of the premises and the mutual terms,
conditions and covenants contained herein, the parties hereto agree as follows

                                 I - DEFINITIONS
                                 ---------------

          For the purposes of this  Agreement,   the following words and phrases
shall have the following meanings:

          1.1  "ADAPTATIONS"  shall  mean the   PROGRAM  as it maybe  adapted by
 LICENSEE for hardware other than the original M.I.T. Cray computer.

          1.2 "COPYRIGHT" shall mean M.I.T.'s copyrights in the PROGRAM.

          1.3  "DERIVATIVE  WORKS" shall  mean a  program that  uses the M.I.T'.
COPYRIGHTED  PROGRAM  and/or  and  ADAPTATION,  but which has  enhanced  and new
features  or  fewer  features.  LICENSEE  shall be  entitled  to  establish  all
proprietary  rights  for  itself in the  intellectual  property  represented  by
LICENSEE-created  enhancements and new features,  whether in the nature of trade
secrets, copyrights or patent rights or other rights M.I.T. shall be entitled to
establish  all  proprietary  rights  for  itself  in the  intellectual  property
represented M.I.T.-created  enhancements and new features, whether in the nature
of copyrights or patent rights or other rights.

          1.4  "END USER" shall mean a customer licensed or otherwise authorized
 by LICENSEE to use a single copy of the PROGRAM for internal  purposes only and
 not for further distribution.

          1.5  On the EFFECTIVE DATE, "EXCLUSIVE FIELDS OF USE" shall mean FIELD
 OF USE ONE,  FIELD OF USE TWO, and FIELD OF USE THREE.  This  definition may be
 modified according to paragraphs 3.6, 3.7 and 3.8.

          1.6 "FIELD OF USE ONE" shall mean Breast Hyperthermia.


                                       2
<PAGE>





I

          1.7 "FIELD OF USE TWO" shall mean Prostate Hyperthermia.

          1.8 "FIELD OF USE THREE" shall mean all other medical applications.

          1.9 "INTELLECTUAL PROPERTY RIGHTS" shall mean all of the PATENT RIGHTS
and COPYRIGHT.

          1.10  "LICENSED  PROCESS"  shall mean any process  which is covered in
whole or in part by an issued,  unexpired  claim or a pending claim contained in
the PATENT RIGHTS, or by the COPYRIGHT,

          1.11 "LICENSED PRODUCT" shall mean LICENSEE's  hyperthermia machine or
part  thereof,  and  accessories,  including,  but  not  limited  to  disposable
accessories such as temperature probes and needles, which:

               (a)      is covered  in whole or in part by an issued,  unexpired
                        claim or a pending claim  contained in the PATENT RIGHTS
                        in the  country  in which any such  LICENSED  PRODUCT or
                        part thereof is made, used or sold; or

               (b)      is  manufactured  by using a process or is  employed  to
                        practice a process  which is covered in whole or in part
                        by  an  issued,  unexpired  claim  or  a  pending  claim
                        contained  in the PATENT  RIGHTS in the country in which
                        any LICENSED PROCESS is used or in which such product or
                        put thereof is used or sold.

               (c)      is covered in whole or in part by the COPYRIGHT.

          1.12 "LICENSED  SERVICE" shall mean any fee-bearing  service performed
by LICENSEE or any  SU13LICENSEE  or any MEDICAL  SERVICE  PROVIDER which uses a
LICENSED PRODUCT or practices a LICENSED PROCESS.

          1.13  "LICENSEE"  shall  mean  Cheung  Laboratories,  Inc.,  and shall
include a related  company of Cheung  Laboratories,  Inc.,  the voting  stock of
which is directly or indirectly at least fifty percent (50%) owned or controlled
by Cheung Laboratories, Inc.

          1.14.  "MEDICAL  SERVICE  PROVIDER" shall mean a customer or user of a
LICENSED  PRODUCT,  at a clinical  site,  licensed or  otherwise  authorized  to
practice a LICENSED PROCESS and/or perform a LICENSED SERVICE by LICENSEE, which
customer or user has  explicitly'  not been granted  rights by LICENSEE to make,
sell, or lease LICENSED PRODUCTS.

          1.15  "MILESTONE  PAYMENT"  shall mean a payment to LICENSEE from  any
third party due upon  achievement of an agreed upon  technical,  regulatory,  or
business milestone related to LICENSED PRODUCTS, LICENSED PROCESSES, or LICENSED
SERVICES.  Illustrative examples of such milestones include, but are not limited
to,  achieving a technical  result,  obtaining FDA  approval,  and meeting sales
targets.

          MILESTONE  PAYMENTS  shall not  include  (i) any  payments to LICENSEE
which are subject to royalties  under  paragraphs  4.1 (h), (i) or (j), (ii) any
advances  to  LICENSEE  pursuant  to  bank  loans  or  other  bona  fide  credit
arrangements,  and (iii) any payments to LICENSEE to acquire  LICENSEE's capital
stock at a price not exceeding the fair market value thereof.


                                       3
<PAGE>




          1. 16 "NET SALES" shall mean the sum of the following:

          a) LICENSEE's  and its  SUBLICENSEE'S  billings for LICENSED  PRODUCTS
(including, explicitly, the PROGRAM), LICENSED PROCESSES, and LICENSED SERVICES,
less the sum of the following  items,  providing that these items are payable by
LICENSEE (or by its  SUBLICENSEE ) or deductible  from  LICENSEE's  billings (or
from  SUBLICENSEE'S  billings) within sixty (60) days of receiving payments from
LICENSEE's (or SUBLICENSEE'S) customer(s):

               i.       discounts  allowed in amounts customary in the trade for
                        quantity  purchases,  cash  payments,  prompt  payments,
                        wholesalers and distributors;

               ii.      sales,  tariff duties and/or use taxes directly  imposed
                        and with reference to particular sales;

               iii.     outbound transportation prepaid or allowed;

               iv.      amounts allowed or credited on returns or refunds; and

               V.       allowance for bad debt,  not to exceed Five Percent (5%)
                        of NET SALES per calendar year.

          No other  deductions  shall be made for commissions paid to individual
whether  they be with  independent  sales  agencies  or  regularly  employed  by
LICENSEE and on its payroll, or for the cost of collections.  LICENSED PRODUCTS,
LICENSED PROCESSES, or LICENSED SERVICES shall be considered, "sold" ninety (90)
days after billing,  or invoicing,  or upon receipt of payment,  whichever comes
first,  provided,   however-that  LICENSED  PRODUCTS  are  actually  shipped  to
customers; plus

          b)      LICENSEE's  gross  receipts  from MEDICAL  SERVICE  PROVIDERS,
other than gross receipts from MEDICAL  SERVICE  PROVIDERS,  other than receipts
counted in paragraph 1. 16 (a) above.

          1.17 "OTHER  REVENUE"  shall mean  LICENSEE's  gross revenues from the
sale of its own services for consulting, research and development, and training,
in connection with:
              a.       the  sublicensing of the  INTELLECTUAL  PROPERTY  RIGHTS;
                       and/or

              b        the use or  sale,  lease or other  transfer  of  LICENSED
                       PRODUCTS, LICENSED PROCESSES and LICENSED SERVICES.

          1.18  "PATENT   RIGHTS"  shall  mean  all  of  the  following   M.I.T.
intellectual property:

              a.       the United States patents listed in Appendix A;

              b.       the United States patent  applications listed in Appendix
                       A,  and   divisionals,   continuations   and   claims  of
                       continuation-in-part applications which shall be directed
                       to subject matter  specifically  described in such patent
                       applications, and the resulting patents;'

              c.       any patents  resulting from reissues or reexaminations of
                       the United States patents described in a. and b. above;

                                       4
<PAGE>

               d.      the Foreign patents listed in Appendix A;

               e.      the Foreign parent applications listed in Appendix A, and
                       divisionals,      continuations     and     claims     of
                       continuation-in-part applications which shall be directed
                       to subject matter specifically  described in such Foreign
                       patent applications, and the resulting patents;

               f.      Foreign  patent  applications  filed after the  EFFECTIVE
                       DATE  in  the   countries   listed  in   Appendix  B  and
                       divisionals,  continuations  and  claims of  continuation
                       in-part  applications  which shall be directed to subject
                       matter    specifically    described    in   such   patent
                       applications, and the resulting patents; and

               9.      any Foreign  patents,  resulting from equivalent  Foreign
                       procedures to United States  reissues and  reexaminations
                       of the Foreign patents described in d., e. and f. above.

          1.19  "PROGRAM"  shall mean the  computer  program(s),  "NULLGSC"  and
"FOCUSGSC"   and  related   documentation,   if  any  described  in  Appendix  C
(hereinafter  the  "M.I.T.   COPYRIGHTED  PROGRAM"),   and  shall  also  include
ADAPTATIONS, DERIVATIVE WORKS and TRANSLATIONS. PROGRAM may be protected by both
PATENT RIGHTS and COPYRIGHTS,

          1.20 "SUBLICENSEE" shall mean an entity which has the right to i) make
or have  made and sell  LICENSED  PRODUCTS  or ii) make or have  made and  lease
LICENSED PRODUCTS.

          1.21  "TRANSLATION"  shall  mean a  translation  of the  PROGRAM  into
another language.

                                     2-GRANT
                                     -------


          2.1 M.I.T.  hereby  grants to LICENSEE the right and license for FIELD
OF USE ONE,  FIELD OF USE TWO,  and  FIELD OF USE  THREE to  practice  under the
PATENT RIGHTS and, to the extent not prohibited by. other patents, to make, Lave
made, use, lease, sell and import LICENSED PRODUCTS and to practice the LICENSED
PROCESSES,  and to perform LICENSED SERVICES until the expiration of the last to
expire of the, PATENT RIGHTS,  unless this Agreement shall be sooner  terminated
according to the terms hereof.
          2.2 M.I.T. hereby grants to LICENSEE the following rights and licenses
for FIELD OF USE ONE, FIELD OF USE TWO, and FIELD OF USE THREE to the end of the
term for which the COPYRIGHT  shall be granted,  unless this Agreement  shall be
sooner terminated:

              a.       to use and reproduce the PROGRAM;

              b.       to create DERIVATIVE WORKS; and

              c.       to  lease,   transfer  and   sublicense  the  PROGRAM  to
                       END-USERS  through the normal  channels of  distribution;
                       and

          2.3 In order to establish a period of exclusivity for LICENSEE, M.I.T.
hereby agrees that it shall not grant any other license to the PATENT RIGHTS for


                                       5
<PAGE>


the EXCLUSIVE  FIELDS OF USE, and also that it shall not grant any other license
to the COPYRIGHT for the EXCLUSIVE FIELDS OF USE, subject only to Paragraphs 2.5
and 2.6 and to the  royalty-free,  nonexclusive  license  rights  of the  United
States  Government  pursuant to 48 CFR 52.227-14  (Civilian  Agencies) and DFARS
252.227-7013  (Defense  Agencies)  during the period of time commencing with the
EFFECTIVE DATE and terminating with the first to occur of:

               (a)      the  expiration  of  ten  (10)  years  after  the  first
                        commercial   sale  of  a   LICENSED   PRODUCT  or  first
                        commercial  use  of a  LICENSED  PROCESS  or  the  first
                        commercial performance of a LICENSED SERVICE; or

               (b)      the  expiration of twelve (12) years after the EFFECTIVE
                        DATE of this Agreement.

          2.4 At the end of the exclusive period,  the license granted hereunder
shall become  nonexclusive  and shall extend to the end of the term or terms for
which any PATENT  RIGHTS or COPYRIGHT are granted,  unless sooner  terminated as
hereinafter provided. The period of exclusivity may be extended with the written
consent of M.I.T., on a field of use basis, which consent shall not unreasonably
be withheld,  provided  that LICENSEE is a licensee in good  standing,  owing no
fees,  royalties or any other monies to M.I.T., and having met all the diligence
milestones  pertaining to the  particular  field of use in which an extension of
the period of exclusivity is under consideration.
          2.5 M.I.T,  reserves the right to practice under the PATENT RIGHTS for
its own noncommercial research purposes.
          2.6 M.I.T.  reserves  the right to use the PROGRAM,  to use and create
DERIVATIVE WORKS of the PROGRAM and to distribute the PROGRAM and M.I.T.-created
DERIVATIVE WORKS to third parties for noncommercial research purposes.
          2.7 LICENSEE  agrees  that  LICENSED  PRODUCTS   leased or sold in the
United States shall be manufactured substantially in the United States.
          2.8 In order to encourage and facilitate  the  development of LICENSED
PRODUCTS,  LICENSED  PROCESSES,  and LICENSED SIERVICES M.I.T. agrees to perform
the work described in the Technology Transfer Agreement attached to this license
as ADDENDUM A.
          2.9 LICENSEE   shall  have  the  right  to  enter  into   sublicensing
agreements for the rights, privileges and licenses granted hereunder only during
the exclusive period of this Agreement, and with the following restrictions:

              a)        Such  sublicenses may extend past the expiration date of
                        the  exclusive  period  of this  Agreement,  or upon the
                        termination   of  LICENSEE's   exclusive   rights  in  a
                        particular  field of use,  pursuant to  paragraphs  3.6,
                        3.7, and 3.8, but any  exclusivity  of such  sublicenses
                        shall   expire  upon  the   expiration   of   LICENSEE's
                        exclusivity,

              b)        Upon any  termination of this  Agreement,  sublicensees'
                        rights shall also  terminate,  subject to Paragraph 13.6
                        hereof.



                                       6
<PAGE>



               c)       LICENSEE may not grant sublicenses which perrmit further
                        sublicensing of the INTELLECTUAL PROPERTY RIGHTS without
                        the express written permission of M.I.T.,

               d)       LICENSEE may not grant the rights to make, lease or sell
                        LICENSED PRODUCTS to MEDICAL SERVICES PROVIDERS.

          2.10  LICENSEE agrees that any sublicenses granted by it shall provide
that the  obligations to M.I.T. of Articles 2, 5, 7, 8, 9, 10, 12, 13, and 15 of
this  Agreement  shall be binding upon the  sublicensee as if it were a party to
this  Agreement.  LICENSEE  further agrees to attach copies of these Articles to
sublicense agreements.
          2.11 LICENSEE  agrees  to  forward  to  M.I.T.  a copy  of any and all
sublicense agreements promptly upon execution by the parties.
          2.12 LICENSEE shall not receive from SUBLICENSEES anything of value in
lieu of cash payments in consideration  for any sublicense under this Agreement,
without the express prior written permission of M.I.T.
          2.13 The license  granted  hereunder  shall not be construed to confer
any rights  upon  LICENSEE  by  implication,  estoppel  or  otherwise  as to any
technology not specifically set forth in Appendix A hereof

                                3 - DUE DILIGENCE
                                -----------------

           3.1 LICENSEE shall use its best efforts to bring one or more LICENSED
PRODUCTS, LICENSED PROCESSES, or LICENSED SERVICES to market through a thorough,
vigorous and diligent  program for  exploitation  of the  INTELLECTUAL  PROPERTY
RIGHTS  and to  continue  active,  diligent  marketing  efforts  for one or more
LICENSED PRODUCTS,  LICENSED PROCESSES or LICENSED SERVICES throughout the. life
of this Agreement.
           3.2  LICENSEE  shall  raise  a  minimum  of  (Confidential  Treatment
Requested)  Dollars  toward  the  development  of  LICENSED  PRODUCTS,  LICENSED
PROCESSES or LICENSED SERVICES according to the following schedule:

                (a)      (Confidential Treatment Requested) Dollars on or before
                         January 1, 1998.

                (b)      An additional(Confidential Treatment Requested) Dollars
                         on or before June 30, 1998.

                (c)      An additional(Confidential Treatment Requested) Dollars
                         on or before January 1, 2000.

           3.3 (a) In addition,  pertaining to FIELD OF USE ONE,  LICENSEE shall
adhere to the following milestone:

                         As soon as  possible,  but in all  events  on or before
                         June 30, 1999 LICENSEE shall apply for FDA approval for
                         commercial  sale of a LICENSED  PRODUCT in FIELD OF USE
                         ONE,  and/or for FDA approval for the commercial use of



                                       7
<PAGE>



                         a  LICENSED  PROCESS  or  commercial  performance  of a
                         LICENSED SERVICE in FIELD OF USE ONE.

                   (b) In  addition,  pertaining  to FIELD OF USE TWO,  LICENSEE
                   shall adhere to the following milestone:

                       As soon as possible,  but in all events on or before June
                       30,  2001  LICENSEE  shall  apply  for FDA  approval  for
                       commercial  sale of a  LICENSED  PRODUCT  in FIELD OF USE
                       TWO,  and/or for FDA approval for the commercial use of a
                       LICENSED PROCESS or commercial  performance of a LICENSED
                       SERVICE in FIELD OF USE TWO.

                   (c) In addition,  pertaining to FIELD OF USE THREE,  LICENSEE
                   shall adhere to the following milestone:

                       As soon as possible,  but in all events on or before June
                       30,  2002  LICENSEE  shall  apply  for FDA  approval  for
                       commercial  sale of a  LICENSED  PRODUCT  in FIELD OF USE
                       THREE,  and/or for FDA approval for the commercial use of
                       a  LICENSED  PROCESS  or  commercial   performance  of  a
                       LICENSED SERVICE in FIELD OF USE THREE.

          3.4 LICENSEE shall make sales of LICENSED PRODUCTS in FIELD OF USE ONE
according to the following schedule:

                      1998                                at least I unit
                      1999                                at least 5 units
                      2000                                at least (Confidential
                                                          Treatment   Requested)
                                                          units
                      2001 and each year there after      at least (Confidential
                                                          Treatment   Requested)
                                                          units


          3.5 Failure to comply with any of paragraphs 3.2 (a), (b) or (c) shall
be grounds for for M.I.T.  to terminate this license  pursuant to paragraph 13.3
hereof, M.I.T. to terminate this license pursuant to paragraph 13.3 hereof,
          3.6 Failure to comply with paragraph 3.3 (a) or paragraph 3.4 shall be
grounds to remove FIELD OF USE ONE from the  definition of "EXCLUSIVE  FIELDS OF
USE", thereby terminating LICENSEE's exclusive rights to FIELD OF USE ONE. Under
these circumstances,  LICENSEE explicitly retains  non-exclusive rights to FIELD
OF USE ONE.
          3.7  Failure  to comply  with  paragraph  3.3 (b) shall be  grounds to
remove  FIELD OF USE TWO from  the  definition  of  "EXCLUSIVE  FIELDS  OF USE",
thereby terminating LICENSEE's exclusive rights to FIELD OF USE TWO. Under these
circumstances,  LICENSEE explicitly retains non-exclusive rights to FIELD OF USE
TWO.
          3.8  Failure  to comply  with  paragraph  3.3 (c) shall be  grounds to
remove  FIELD OF USE THREE from the  definition  of  "EXCLUSIVE  FIELDS OF USE",
thereby  terminating  LICENSEE's  exclusive rights to FIELD OF USE THREE.  Under
these circumstances,  LICENSEE explicitly retains  non-exclusive rights to FIELD
OF USE THREE.



                                       8
<PAGE>

                                  4 - ROYALTIES
                                  -------------

          4.1 For the rights, privileges and license granted hereunder, LICENSEE
          shall pay royalties to M.I.T.  in the manner  hereinafter  provided to
          the end of the term of the PATENT RIGHTS or until this Agreement shall
          be terminated:

              (a)      License  Maintenance  Fees  of  (Confidential   Treatment
                       Requested)  Dollars  per year  payable on January 1, 1998
                       and on January 1, 1999; provided,  however,  that Running
                       Royalties  subsequently  due on NET  SALES  for each said
                       year,  if any,  shall be  creditable  against the License
                       Maintenance Fee for said year.  License  Maintenance Fees
                       paid  in  excess  of  Running,  Royalties  shall  not  be
                       creditable to Running Royalties for future years.

              (b)      License  Maintenance  Fees  of  (Confidential   Treatment
                       Requested)  Dollars  per year  payable on January 1, 2000
                       and on January 1, 2001  provided,  however,  that Running
                       Royalties  subsequently  due on NET  SALES  for each said
                       year,  if any,  shall be  creditable  against the License
                       Maintenance Fee for said year,  License  Maintenance Fees
                       paid  in  excess  of  Running   Royalties  shall  not  be
                       creditable to Running Royalties for future years.

              (c)      License  Maintenance  Fees  of  (Confidential   Treatment
                       Requested)  Dollars  per year  payable on January 1, 2002
                       and on  January  1 of  each  year  thereafter;  provided,
                       however,"  License  Maintenance  Fees may be  credited to
                       Running Royalties  subsequently due on NET SALES for each
                       said  year,  if any.  License  Maintenance  Fees  paid in
                       excess of Running  Royalties  shall not be  creditable to
                       Running Royalties for future years.

              (d)      (i) Running Royalties in an amount equal to (Confidential
                       Treatment Requested) percent of NET SALES of the LICENSED
                       PRODUCTS,  leased or sold by and/or for  LICENSEE  and/or
                       its SUBLICENSEES  for LICENSED  PRODUCTS which are either
                       made or leased or sold in a country  in which  there is a
                       valid,  issued  claim of a  patent  described  in  either
                       APPENDICES A or B.

                       (ii)   Running   Royalties   in  an   amount   equal   to
                       (Confidential  Treatment  Requested) percent of NET SALES
                       of LICENSED  SERVICES  performed  by and/or for  LICENSEE
                       and/or  its  SUBLICENSEES   and/or  'authorized   MEDICAL
                       SERVICE PROVIDERS,  utilizing LICENSED PRODUCTS which are
                       either made or leased or sold in a country in which there
                       is a valid, issued claim of. a patent described in either
                       APPENDICES A,or B.

              (e)      (i) Running Royalties in an amount equal to (Confidential
                       Treatment Requested) percent of NET SALES of the LICENSED
                       PRODUCTS,  leased or sold by and/or for  LICENSEE  and/or
                       its SUBLICENSEES for LICENSED  PRODUCTS which are neither
                       made nor leased nor sold in a country in which there is a
                       valid,  issued  claim of a  patent  described  in  either
                       APPENDICES A or B, but which utilize the COPYRIGHT and/or
                       practice or ran the PROGRAM, as described in APPENDIX C.

                       (ii)   Running   Royalties   in  an   amount   equal   to
                       (Confidential  Treatment  Requested) percent of NET SALES
                       of LICENSED  SERVICES  performed  by and/or for  LICENSEE
                       and/or its SUBLICENSEES and/or authorized MEDICAL SERVICE
                       PROVIDERS,  Utilizing LICENSED PRODUCTS which are neither
                       made nor leased nor sold in a country in which there is a
                       valid,  issued  claim of a  patent  described  in  either
                       APPENDICES A or B, but which utilize the COPYRIGHT and/or
                       practice or run the PROGRAM, as described in APPENDIX C.

                                       9
<PAGE>

               (f)     Running  Royalties  in an amount  equal to  (Confidential
                       Treatment  Requested) percent of NET SALES of the PROGRAM
                       delivered to END-USERS if the PROGRAM is sold  separately
                       from the LICENSED PRODUCTS.

               (g)     (Confidential  Treatment  Requested) Percent of MILESTONE
                       PAYMENTS received by LICENSEE.

               (h)     (Confidential  Treatment  Requested)  Percent of lump sum
                       type payments  received by LICENSEE from its SUBLICENSEES
                       in consideration for a grant by LICENSEE to a SUBLICENSEE
                       to  practice  under  the  INTELLECTUAL  PROPERTY  RIGHTS,
                       including, explicitly, the right to make, sell, and lease
                       LICENSED PRODUCTS,  without a substantial and essentially
                       simultaneous  grant by  LICENSEE  to the  SUBLICENSEE  of
                       LICENSEE-owned technology.

               (i)     (Confidential  Treatment  Requested)  Percent of lump sum
                       type payments  received by LICENSEE from its SUBLICENSEES
                       in consideration for a grant by LICENSEE to a SUBLICENSEE
                       to  practice  under  the  INTELLECTUAL  PROPERTY  RIGHTS,
                       including, explicitly, the right to make, sell, and lease
                       LICENSED  PRODUCTS,  with a substantial  and  essentially
                       simultaneous  grant by  LICENSEE  to the  SUBLICENSEE  of
                       LICENSEE-owned technology.

               (j)     (Confidential  Treatment  Requested)  Percent of lump sum
                       type  payments  received  by  LICENSEE  from its  MEDICAL
                       SERVICE  PROVIDERS in  consideration  for a fully paid up
                       license  and/or   authorization   to  practice   LICENSED
                       PROCESSES and perform LICENSED SERVICES,  with no further
                       reporting  required from the MEDICAL SERVICE  PROVIDER to
                       LICENSEE concerning its practice of LICENSED PROCESSES or
                       performance of LICENSED SERVICES.

               (k)     If OTHER REVENUE is greater than NET SALES,  then Running
                       Royalties in an amount equal to  (Confidential  Treatment
                       Requested) percent of OTHER REVENUE.

               (l)     If OTHER  REVENUE  is less than NET SALES,  then  Running
                       Royalties in an amount equal to  (Confidential  Treatment
                       Requested) percent of OTHER REVENUE.

          4.2  All  payments  due  hereunder  shall  be paid  in  full,  without
deduction  of taxes or other fees which may be  imposed by any  governrnent  and
which shall be paid by LICENSEE.
          4.3 No  multiple  royalties  shall be  payable  because  any  LICENSED
PRODUCT,  its  manufacture,  use,  lease or sale are or shall be covered by more
than one PATENT RIGHTS patent  application  or COPYRIGHT or PATENT RIGHTS patent
licensed under this Agreement.
          4.4 No  multiple  royalties  shall be  payable  because  any  LICENSED
PROCESS of LICENSED  SERVICE,  its use,  practice,  or performance is covered by
more than one PATENT  RIGHTS  patent  application  or COPYRIGHT or PATENT RIGHTS
patent licensed under this Agreement.
          4.5  Royalty  payments  shall  be paid in  United  States  dollars  in
Cambridge,  Massachusetts,  or at such  other  place as  M.I.T.  may  reasonably
designate  consistent with the laws and  regulations  controlling in any foreign
country.  If any currency  conversion  shall be required in connection  with the
payment  of  royalties  hereunder,  such  conversion  shall be made by using the

                                       10
<PAGE>


I

exchange rate prevailing at the Chase Manhattan Bank (N.A.) on the last business
day of the calendar  quarterly  reporting  period to which such royalty payments
relate.

                             5 - REPORTS AND RECORDS
                             -----------------------

          5.1  LICENSEE  shall keep  full,  true and  accurate  books of account
containing all particulars  that may be necessary for the purpose of showing the
amounts  payable to M.I.T.  hereunder.  Said  books of account  shall be kept at
LICENSEE's  principal  place of business or the   principal place of business of
the appropriate division of LICENSEE to which this Agreement relates. Said books
and the supporting data shall be open at all reasonable times for five (5) years
following the end of the calendar year to which they pertain,  to the inspection
of  M.I.T.  or its  agents  for the  purpose  of  verifying  LICENSEE's  royalty
statement or  compliance  in other  respects  with this  Agreement,  Should such
inspection  lead  to  the  discovery  of a  greater  than  Ten  Perceric  (107o)
discrepancy  in  reporting  to M.I.T.'s  detriment,  LICENSEE  agrees to pay die
reasonable cost of such inspection.
          5.2 LICENSEE shall deliver to M.I.T. true and accurate reports, giving
such  particulars  of the business  conducted  by LICENSEE and its  sublicensees
under this  Agreement as shall be pertinent  to  diligence  under  Article 3 and
royalty accounting hereunder.

              a.       before the first commercial sale of a LICENSED PRODUCT or
                       LICENSED SERVICE,  annually,  on January 31 of each year;
                       and

              b.       after the first  commercial sale of a LICENSED PRODUCT or
                       LICENSED SERVICE, quarterly, within sixty (60) days after
                       March 31, June 30,  September 30 and December 31, of each
                       year.

          These reports shall include at least the following

              a.       money raised pursuant to paragraph 3.2.

              b.       number of LICENSED PRODUCTS manufactured, leased and sold
                       by and/or for LICENSEE and all SUBLICENSEES;

              c        accounting  for all LICENSED  SERVICES sold by and/or for
                       LICENSEE  and all  SUBLICENSEES  and all MEDICAL  SERVICE
                       PROVIDERS;

              d        accounting  for NET  SALES,  noting  the  deductions  and
                       credits  applicable  as provided in  Paragraphs 1.16  and
                       6.3, accounting for OTHER REVENUE;

              e        Running  Royalties due  under Paragraph 4.1 (d), (e), and
                       (f);

              f.       payments on MILESTONE  PAYMENTS due under  Paragraph  4.1
                       (g);

              g.       Share of lump sum type payment received from SUBLICENSEES
                       and from MEDICAL  SERVICE  PROVIDERS due under  Paragraph
                       4.1 (h), (i) and (j);

              h        payments on OTHER  REVENUE due under  paragraphs  4.1 (k)
                       and (1);


                                       11
<PAGE>

              i.        total royalties due; and

              j.        names and addresses of all SUBLICENSEES  of LICENSEE and
                        of all authorized MEDICAL SERVICE PROVIDERS.

          5.3 With each such report submitted,  LICENSEE shall pay to M.I.T. the
royalties due and payable under this  Agreement.  If no royalties  shall be due,
LICENSEE shall so report.
          5.4 On or before  the  ninetieth  (90th)  day  following  the close of
LICENSEE's fiscal year, LICENSEE shall provide M.I.T. with LICENSEE's  certified
financial  statements for the preceding fiscal year including,  at a minimum,  a
Balance Sheet and an Operating Statement.
          5.5 The royalty  payments set forth in this  Agreement and amounts due
under Article 6 shall,  if overdue,  bear interest  until payment at a per annum
rate two percent (2%) above the prime rate in effect at the Chase Manhattan Bank
(N.A.) on the due date. The payment of such interest shall not foreclose  M.I.T.
from exercising any other rights it may have as a consequence of the lateness of
any payment.

                             6 - PATENT PROSECUTION
                             ----------------------

          6.1 M.I.T. have the  administrative  responsibility to apply for, seek
prompt  issuance of, and maintain  during the term of this  Agreement the PATENT
RIGHTS in the United States and in the foreign  countries listed in Appendices A
and B hereto.  Appendix B may be amended by verbal  agreement  of both  parties,
such agreement to be confirmed in writing within ten (10) days. The prosecution,
filing and  maintenance of all PATENT RIGHTS patents and  applications  shall be
the primary  responsibility of M.I.T.;  provided,  however,  LICENSEE shall have
reasonable  opportunities  to advise M.I.T.  and shall  cooperate with M.I.T. in
such prosecution, filing and maintenance. ng and maintenance.
          6.2 Payment of all fees and costs relating to the filing, prosecution,
and  maintenance of the PATENT RIGHTS  incurred after the date of this Agreement
shall be the  responsibility of LICENSEE.  M.I.T. is not financially  obliged to
maintain and prosecute patents.
          6.3 M.I.T.  agrees that LICENSEE may take a cumulative life of license
credit  for  expenditures  on the  PATENT  RIGHTS,  such  credit  not to  exceed
(Confidential  Treatment  Requested)  Dollars and to be taken  according  to the
following schedule:


               a)       LICENSEE  may  credit  their  above  referenced   patent
                        prosecution and maintenance  expenditures  incurred in a
                        given  calendar  year  against up to one half of License
                        Maintenance  Fees  due  the  following  January  1 under
                        paragraphs, 4.1 (a), (b), and (c).

               b)       In the event that Running  Royalties  exceed the License
                        Maintenance  Fee for a given  year,  and  LICENSEE  owes
                        M.I.T.  Running  Royalties  in  addition  to the License
                        Maintenance  Fee already  paid,  then  LICENSEE  may use
                        their patent  prosecution and maintenance credit against
                        up to one half of the Running  Royalties due  paragraphs
                        4.1 (d), (e) and (f).

                                       12
<PAGE>



                                7 - INFRINGEMENT
                                ----------------

         7.1  LICENSEE  shall inform  M.I.T.  promptly in writing of any alleged
infringement  of the  INTELLECTUAL  PROPERTY RIGHTS by a third party of which it
becomes  aware  and of any  available  evidence  thereof.  M.I.T.  shall  inform
LICENSEE  promptly in writing of any alleged  infringement  of the  INTELLECTUAL
PROPERTY  RIGHTS by a third party of which it becomes aware and of any available
evidence thereof. Within ten (10) business days of such notice the parties shall
confer to determine how best to proceed.
         7.2  During the term of this  Agreement,  M.I.T.  shall have the right,
but shall not be obligated,  to prosecute at its own expense all infringementsof
the  INTTELLECTUAL  PROPERTY RIGHTS and, in furtherance of such right,  LICENSEE
hereby agrees that M.I.T. may include  LICENSEE as a party plaintiff in any such
suit,  without  expense to  LICENSEE.  The total  cost of any such  infringement
action  commenced  or  defended  solely by M.I.T.  shall be borne by M.I.T.  and
M.I.T.  shall  keep  any  recovery  or  damages  for past  infringement  derived
therefrom.
         7.3  If within six (6) months after having been notified of any alleged
infringement,  M.I.T.  shall have been  unsuccessful  in persuading  the alleged
infringer  to  desist  and shall not have  brought  and shall not be  diligently
prosecuting an infringement  action,  or if M.I.T.  shall notify LICENSEE at any
time  prior  thereto of its  intention  not to bring suit  against  any  alleged
infringer  for the  EXCLUSIVE  FIELDS OF USE,  then,  and in those  events only,
LICENSEE shall have the right,  but shall not be obligated,  to prosecute at its
own  expense  any  infringement  of the  INTELLECTUAL  PROPERTY  RIGHTS  for the
EXCLUSIVE  FIELDS OF USE, and LICENSEE may, for such  purposes,  use the name of
M.I.T. as party plaintiff;  provided,  however, that such right to bring such an
infringement  action  shall  remain  in effect  only for so long as the  license
granted  herein remains  exclusive.  No  settlement,  consent  judgment or other
voluntary final  disposition of the suit may be entered into without the consent
of M.I.T.,  which consent shall not  unreasonably  be withheld.  LICENSEE  shall
indemnify M.I.T.  against any order for costs that may be made against M.I.T. in
such proceedings.
          7.4 In the event that LICENSEE shall undertake the enforcement  and/or
defense of the INTELLECTUAL PROPERTY RIGHTS by litigation, LICENSEE may withhold
up to  (Confidential  Treatment  Requested)  percent of the  payments  otherwise
thereafter  due  M.I.T.  under  Article 4  hereunder  and apply the same  toward
reimbursement  of  up to  half  of  LICENSEE's  expenses,  including  reasonable
attorneys'  fees, in connection  therewith.  Any recovery of damages by LICENSEE
for each such suit shall be applied first in  satisfaction  of any  unreimbursed
expenses  and legal fees of  LICENSEE  relating  to such suit,  and next  toward
reimbursement  of M.I.T.  for any payments  under Article 4 past due or withheld
and applied  pursuant to this  Article 7. The  balance  remaining  from any such
recovery shall be divided so that the  percentage of the recovery due M.I.T.  is
calculated by creating a fraction,

                                       13
<PAGE>



the numerator of witch is the amount of royalties  withheld,  and denominator of
which is the cost of litigation paid by LICENSEE, but in no event shall such sum
be less than (Confidential Treatment Requested) Percent  of the net recovery.
          7.5 In  the  event  that  a  declaratory    judgment  action  alleging
invalidity or noninfringement  of any of the INTELLECTUAL  PROPERTY RIGHTS shall
be brought against LICENSEE, M.I.T., at its option, shall have the right, within
thirty (30) days after  commencement of such action,  to intervene and take over
the sole defense of the action at its own expense.
          7.6 1n any infringement  suit as either party may institute to enforce
the PATENT RIGHTS pursuant to this  Agreement,  the other party hereto shall, at
the request and expense of the party  initiating,  such suit,  cooperate  in all
respects and, to the extent possible,  have its employees testify when requested
and make available relevant records, papers,  information,  samples,  specimens,
and the like.
          7.7 LICENSEE,  during the exclusive  period of this  Agreement,  shall
have the sole  right in  accordance  with the  terms  and  conditions  herein to
sublicense any alleged  infringer for the EXCLUSIVE FIELDS OF USE for future use
of the  INTELLECTUAL  PROPERTY  RIGHTS.  Any  upfront  fees  as  part  of such a
sublicense shall be shared equally between LICENSEE and M.I.T.;  other royalties
shall be treated per Article 4.

                                PRODUCT LIABILITY
                                -----------------

          8.1 LICENSEE  shall at all times during the term of this Agreement and
thereafter,   indemnify,  defend  and  hold  M.I.T.,  its  trustees,  directors,
officers, employees and affiliates,  harmless against all clairns,  proceedings,
demands and  abilities  of any kind  whatsoever,  including  legal  expenses and
reasonable  attoneys' fees,  arising out of the death of or injury to any person
or persons  or out of any damage to  property,  resulting  from the  production,
manufacture,  sale, use,  lease,  consumption or  advertisement  of the LICENSED
PRODUCT(s)  and/or  LICENSED  PROCESS  (es) or arising  from any  obligation  of
LICENSEE hereunder.

          8.2  LICENSEE  shall  obtain  and  carry  in full  force  and  effect.
commercial  general liability  insurance which shall protect LICENSEE and M.I.T.
with respect to events covered by Paragraph 8.1 above.  Such insurance  shall be
written by a  reputable  insurance  company  authorized  to do  business  in the
Commonwealth of Massachusetts, shall list M.I.T. as an additional named inssured
thereunder,  shall be endorsed to include product  liability  coverage and shall
require  thirty  (30) days  written  notice  to be given to M.I.T.  prior to any
cancellation  or al change  thereof.  The limits of such insurance  shall not be
less than  (Confidential  Treatment  Requested)  Dollars per occurrence  with an
aggregate of (Confidential  Treatment  Requested) Dollars for personal injury or
death, and  (Confidential  Treatment  Requested)  Dollars per occurrence with an
aggregate of  (Confidential  Treatment  Requested)  Dollars for property damage.
LICENSEE  shall provide M.I.T.  with  Certificates  of Insurance  evidencing the
same.

                                       14
<PAGE>



          8.3 EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, M.I.T.,
ITS  TRUSTEES,   DIRECTORS,   OFFICERS,   EMPLOYEES,   AND  AFFILIATES  MAKE  NO
REPRESENTATIONS AND EXTEND NO WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED,
INCLUDING  BUT NOT  LIMITED TO  WARRANTIES  OF  MERCHANTABILITY,  FITNESS  FOR A
PARTICULAR PURPOSE,  VALIDITY OF PATENT RIGHTS CLAIMS, ISSUED OR PENDING, AND TO
THE  COPYRIGHT  AND THE  ABSENCE  OF LATENT  OR OTHER  DEFECTS,  WHETHER  OR NOT
DISCOVERABLE.  NOTHING IN THIS AGREEMENT SHALL BE CONSTRUED AS A  REPRESENTATION
MADE OR WARRANTY  GIVEN BY M.I.T.  THAT THE  PRACTICE BY LICENSEE OF THE LICENSE
GRANTED  HEREUNDER  SHALL NOT INFRINGE THE PATENT RIGHTS OR THE COPYRIGHT OF ANY
THIRD  PARTY.  IN NO EVENT SHALL  M.I.T.,  ITS  TRUSTEES,  DIRECTORS,  OFFICERS,
EMPLOYEES AND  AFFILIATES BE LIABLE FOR INCIDENTAL OR  CONSEQUENTIAL  DAMAGES OF
ANY KIND,  INCLUDING  ECONOMIC  DAMAGE OR INJURY TO PROPERTY  AND LOST  PROFITS,
REGARDLESS OF WHETHER M.I.T. SHALL BE ADVISED,  SHALL HAVE OTHER REASON TO KNOW,
OR IN FACT SHALL KNOW OF THE POSSIBILITY OF TIM FOREGOING.

                               9 - EXPORT CONTROL
                               ------------------

          LICENSEE  acknowledges  that it is subject to United  States  laws and
regulations  controlling  the  export  of  technical  data,  computer  software,
laboratory  prototypes and other commodities  (including the Arms Export Control
Act,  as  amended  and  the  United  States   Department   of  Commerce   Export
Administration  Regulations).  The  transfer of such items may require a license
from the  cognizant  agency  of the  United  States  Government  and/or  written
assurances  by LICENSEE that LICENSEE  shall not export data or  commodities  to
certain foreign countries without prior approval of such agency.  M.I.T. neither
represents that a license shall riot be required nor that, if required, it shall
be issued.

                             10 - NON-USE OF NAMES.
                             ----------------------

          LICENSEE  shall not use the names or trademarks  of the  Massachusetts
Institute of Technology or Lincoln Laboratory,  nor any adaptation thereof,  nor
the names of any of their employees,  in any  advertising,  promotional or sales
literature without prior written consent obtained from M.I.T., or said employee,
in each case, except that LICENSEE may state that it is licensed by M.I.T. under
one or more of the patents and/or applications comprising the PATENT RIGHTS, and
that is has a license to the COPYRIGHT.


                                       15
<PAGE>


                                 11 - ASSIGNMENT
                                 ---------------

          This  Agreement  is not  assignable  and any attempt to do so shall be
          void.

                             12 - DISPUTE RESOLUTION
                             -----------------------

          12.1  Except  for the  right  of  either  party to apply to a court of
competent   jurisdiction  for  a  temporary  restraining  order,  a  preliminary
injunction,  or other  equitable  relief to  preserve  the status quo or prevent
irreparable harm, any and all claims,  disputes or controversies  arising under,
out of, or in connection with the Agreement,  including any dispute  relating to
patent  validity or  infringement,  which the parties shall be unable to resolve
within sixty (60) days shall be mediated in good faith.  The party  raising such
dispute  shall  promptly  advise  the  other  party of such  claim,  dispute  or
controversy in a writing which describes in reasonable detail the nature of such
dispute.  By not later  than five (5)  business  days  after the  recipient  has
received  such notice of dispute,  each party shall have  selected  for itself a
representative  who  shall  have the  authority  to bind such  party,  and shall
additionally  have  advised  the other party in writing of the name and title of
such representative.  By not later than ten (10) business days after the date of
such  notice of dispute,  the parry  against  whom   harm the  dispute  shall be
raised shall select a mediation firm in the Boston area and such representatives
shall schedule a date with such firm for a mediation hearing,  The parties shall
enter  into good  faith  mediation  and shall  share the costs  equally.  If the
representatives  of the parties have not been able to resolve the dispute within
fifteen  (15)  business  days after  such  mediation  hearing,  then any and all
claims,  disputes or controversies arising, under, out of, or in connection with
this   Agreement,   including  any  dispute   relating  to  patent  validity  or
infringement,  shall be  resolved by final and  binding  arbitration  in Boston,
Massachusetts under the rules of the American  Arbitration  Association,  or the
Patent  Arbitration  Rules if applicable, then obtaining. The arbitrators  shall
have no power to add to, subtract from or  modify any of the terms or conditions
of this Agreement,  nor to award punitive  damages.   Any award rendered in such
arbitration  may be  enforced  by  either  party in  either  the  courts  of the
Commonwealth  of  Massachusetts  or in the United States  District Court for the
District of  Massachusetts,  to whose  jurisdiction for such purposes M.I.T. and
LICENSEE each hereby irrevocably consents and submits.
          12.2  Notwithstanding the foregoing,  nothing in this Article shall be
construed to waive any rights or timely performance of any obligations  existing
under this Agreement.

                                13 - TERMINATION
                                ----------------

          13.1 If LICENSEE shall cease to carry on its business,  this Agreement
shall  terminate  upon notice by M.I.T.
                                       16
<PAGE>

          13.2 Should  LICENSEE  fail to make  any  payment  whatsoever  due and
payable  to M.I.T.  hereunder,  M.I.T,  shall have the right to  terminate  this
Agreement effective on thirty (30) days' notice,  unless LICENSEE shall make all
such payments to M.I.T.  within said thirty (30) day period. Upon the expiration
of the thirty (30) day period, if LICENSEE shall not have made all such payments
to  M.I.T.,   the  rights,   privileges  and  license  granted  hereunder  shall
automatically terminate.
          13.3 Upon any material breach or default of this Agreement by LICENSEE
(including,  but not limited to, breach or default under Paragraph  3.3),  other
than those  occurrences set out in Paragraphs 13.1 and 13.2  hereinabove,  which
shall always take  precedence in that order over any material  breach or default
referred to in this  Paragraph  13.3,  M.I.T.  shall have the right to terminate
this  Agreement  and  the  rights,  privileges  and  license  granted  hereunder
effective on ninety (90) days' notice to LICENSEE. Such termination shall become
automatically  effective  unless  LICENSEE  shall have  cured any such  material
breach or default prior to the expiration of the ninety (90) day period.
          13.4 LICENSEE  shall have the right to terminate this Agreement at any
time on six (6) months'  notice to M.I.T.,  and upon  payment of all amounts due
M.I.T. through the effective date of the termination.
          13.5 Upon termination of this Agreement for any reason, nothing herein
shall be construed  to release  either  party from any  obligation  that matured
prior to the effective date of such  termination;  and Articles 1, 8, 9, 10, 12,
13.5,  13.6,  and 15  shall  survive  any  such  termination.  LICENSEE  and any
SUBLICENSEE thereof may, however,  after the effective date of such termination,
sell all LICENSED  PRODUCTS,  and complete  LICENSED  PRODUCTS in the process of
manufacture  at the time of such  termination  and sell the same,  provided that
LICENSEE  shall make the  payments  to M.I.T.  as  required by Article 4 of this
Agreement and shall submit the reports required by Article 5 hereof.
          13.6 Upon termination of this agreement for any reason:

              a.       LICENSEE shall provide M.I.T. with written assurance that
                       the   original   and  all  copies  of  the   PROGRAM  and
                       DERIVATIVE,  WORKS in its possession or control have been
                       destroyed,  except that, upon prior written authorization
                       from  M.I.T.,  LICENSEE  may  retain a copy for  archival
                       purposes; and

              b.       the  rights  of  END-USERS  to  use  the  PROGRAM   shall
                       continue,   provided   that  any   END-USER   leasing  or
                       sublicensing  the PROGRAM  and not then in default  shall
                       obtain a lease or sublicense  directly from M.I.T.  under
                       reasonable  terms  and  conditions,  which  shall,  at  a
                       minimum, include,  indemnification of M.I.T. and proof of
                       adequate insurance.
          13.7 Upon   termination  of  this  Agreement  for  any  reason,    any
SUBLICENSEE  not then in  default  shall  have the right to seek a license  from
M.I.T.  M.I.T.  agrees to negotiate such licenses in good faith under reasonable
terms and conditions,  which,  shall, at a minimum,  include  indemnification of
M.I.T and proof of adequate insurance.


                                       17
<PAGE>



          13.8 Upon  termination of this  Agreement for any reason,  any MEDICAL
SERVICE  PROVIDER shall have the right to seek a license from M.I.T. to continue
practicing  the LICENSED  PROCESSES  and or  performing  the LICENSED  SERVICES.
M.I.T.  agrees to negotiate such licenses in good faith under  reasonable  terms
and conditions, which shall, at a minimum, include indemnification of M.I.T. and
proof of adequate insurance.

                             14 - PAYMENTS, NOTICES
                             ----------------------
                             & OTHER COMMUNICATIONS
                             ----------------------

       Any payment,  notice or other  communication  pursuant to this  Agreement
shall be sufficiently made or given on the date of mailing if sent to such party
by  certified  first class mail,  return  receipt  requested,  postage  prepaid,
addressed to it at its address below or as it shall designate, by written notice
given to the other party:

       In the case of M.I.T.:

         Director
         Technology Licensing Office
         Massachusetts Institute of Technology
         Room E32-300
         Cambridge, Massachusetts 02139

       In the case of LICENSEE:
         John Mon
         General Manager
         Cheung Laboratories
         10220-1 Old Columbia Road
         Columbia, NO 21046-1705


                           15-MISCELLANEOUS PROVISIONS
                           ---------------------------

          15.1 All disputes arising out of or related to this Agreement,  or the
performance,  enforcement,  breach  or  termination  hereof,  and  any  remedies
relating  thereato,  shall be construed,  governed,  interpreted  and applied in
accordance  with the laws of the  Commonwealth of  Massachusetts,U.S.A.,  except
that questions  affecting the  construction  and effect or any  patent shall  be
determined  by the law of the  country  in which  the  patent  shall  have  been
granted.
          15.2 The parties hereto acknowledge that this Agreement sets forth the
entire  Agreement,  and  understanding  of the parties  hereto as to the subject
matter hereof, and shall not be subject to  any change or modification except by
the execution of a written instrument signed by the parties.
          15.3 The provisions of this Agreement are severable,  and in the event
that any  provisions  Of this  Agreement  shall be  determined  to be invalid or
unenforceable  under  any  controlling  body  of the  law,  such  invalidity  or
unenforceability  shall not in any way affect the validity or  enforceability of
the remaining provisions hereof.

                                       18
<PAGE>


          15.4 LICENSEE agrees to mark the LICENSED  PRODUCTS sold in the United
States with all applicable  United States patent numbers.  All LICENSED PRODUCTS
shipped  to or sold in other  countries  shall be  marked in such a manner as to
conform with the parent laws and practice of the country of manufacture or sale.
          15.5 The  failure of either  party to assert a right  hereunder  or to
insist upon  compliance  with any term or condition of this Agreement  shall not
constitute  a waiver of that  right or excuse a similar  subsequent  failure  to
perform any such term or condition by the other party.

          IN WITNESS WHEREOF,  the parties have duly executed this Agreement the
day and year Set forth below.

MASSACHUSETTS INSTITUTE OF                   CHEUNG LABORATORIES, INC.
TECHNOLOGY
By /s/Lita Nelsen                            By /s/Augustine Y. Cheung
   ----------------------------                 ----------------------------
   Name    Lita L. Nelsen                       Name   Augustine Y. Cheung

   Title   Director Technology                  Title  Chairman
           Licensing Office
   Date    October 17, 1997                     Date   October 24,1997


                                       19
<PAGE>

                                   APPENDIX A
                                   ----------

PATENT RIGHTS ON THE  EFFECTIVE DATE
------------------------------------

UNITED STATES PATENT RIGHTS
---------------------------

M.I.T. Case No. 5493L
U.S. Patent No. 5,251,645, Issued October 12, 1993
"Adaptive Nulling Hyperthermia Array"
By Alan Fenn

M.I.T.  Case No. 5672L
U.S.  Patent  Number  5,441,532,  Issued  August 15, 1995
"Adaptive  Focusing and Nulling  Hyperthermia  Annular and Monopole Phased Array
Applicators"
By Alan Fenn

M.I.T. Case No. 6512L
U.S.P.N. 5,540,737, Issued July 30, 1996
"Minimally  Invasive Monopole Phased Array Hyperthemia  Applicators For Treating
Breast Carcinomas"
By Alan Fenn

M.I.T. Case No. 7615L
"Adaptive Nulling And Focusing, Hyperthermia Phased Arrays
For Activating Thermosensitive, Liposomes For Targeted Delivery Of Drugs To Deep
Human Tissues"
by Alan J. Fenn

FOREIGN PATENT RIGHT5
---------------------

M.I.T. CaseNo. 7615L
Pending Applications in Great Britain, Germany and Canada
"Minimally Invasive Monopole Phased Array Hyperthermia  Applicators For Treating
Breast Carcinomas
By Alan Fenn


                                       20
<PAGE>

                                   APPENDIX C
                                   ----------

M.I.T. COPYRIGHTED SOFTWARE
-------------------------

MIT. Case No. 7299LS
"NULLGSC"
By Alan Fenn

MIT. Case No. 7298LS
"FOCUSGSC"
By Alan Fenn

                                       21
<PAGE>



                                   ADDENDUM A
                                   ----------
                      MASSACHUSETTS INSTITUTE OF TECHNOLOGY
                      -------------------------------------
                          TECHNOLOGY TRANSFER AGREEMENT
                          -----------------------------

          This  Agreement  is made and  entered  into this 24th day of  October,
1997,  (the  "Effective  Date") by and  between  CHEUNG  LABORATORIES,  INC.,  a
corporation  duly organized  under the laws of Maryland and having its principal
office at 10220-I  Old  Columbia  Road,  Columbia,  MD  21046-1705  (hereinafter
referred to as  "LICENSEE")  and the  MASSACHUSETTS  INSTITUE OF  TECHNOLOGY,  a
corporation  duly organized and existing under the laws of the  Commonwealth  of
Massachusetts  and  having  its  principal  office at 77  Massachusetts  Avenue,
Cambridge,  Massachusetts 02139, U.S.A.  (hereinafter  referred to as "M.I.T."),
and relates to the transfer of existing technology in conjunction with a license
granted by M.I.T.  to LICENSEE  on the 24th day of October,  1997 for the Patent
Rights to M.I.T.  Case No.  5493L,  "Adaptive  Hyperthermia  System," by Alan J.
Penn, and M.I.T. Case No, 5672L,  "Non-Invasive  Monopole Hyperthermia Array for
Brain Tumor  Heating," by Alan J. Fenn,  and M.I.T.  Case No.  6512L  "Minimally
Invasive Monopole Phased Array Hyperthermia Applicators for Treating Carcinoma,"
by Alan J. Fenn and  M.I.T.  Case No.  7615L,  "Adaptive  Nulling  And  Focusing
Hyperthermia Phased Arrays For Activating Thermosensitive Liposomes For Targeted
Delivery  Of Drugs To Deep  Human  Tissues,"  by Alan 1. Fenn  (hereinafter  the
"Rights Granted").

          WHEREAS,  M.I.T. and LICENSEE recognize that the effective development
of the licensed  Rights Granted  requires the INVENTOR (as later defined herein)
to provide  technical  assistance to the LICENSEE to facilitate  the transfer of
existing licensed technology; and

          WHEREAS,  this Agreement  defines the terms and conditions under which
Alan J. Fenn (hereinafter referred to as the "INVENTOR"),  a researcher employed
by M.I.T.  and the INVENTOR of M.I.T.  Case Numbers  5493L,  5672L,  6512L,  and
M.I.T. Case No. 7615L,  shall provide technical  assistance to LICENSEE relating
to said M.I.T. Cases (hereinafter referred to as the "TRANSFER PROGRAM").

                   NOW, THEREFORE, the parties hereto agree as follows:

          1.       FIELD AND  SCOPE OF THE  TRANSFER  PROGRAM:
                   -------------------------------------------
                   The field of the  TRANSFER  PROGRAM  is  defined  by the Work
                   Statement  attached  hereto  as  Attachment  A. The  TRANSFER
                   PROGRAM may include site visits to LICENSEE's facilities, and
                   consultation  by telephone.  M.I.T.  agrees to use reasonable
                   efforts  to  make   available  to  the   LICENSEE   technical
                   assistance by the INVENTOR.


                                       22
<PAGE>




   2.              DURATION
                   ---------
                   The TRANSFER  PROGRAM shall begin on the  Effective  Date and
                   terminate  one  (1)  year  later  on  _______  unless  sooner
                   terminated at will by LICENSEE  notifying  M.I.T.  in writing
                   Thirty (30) days before it wishes to  terminate  the TRANSFER
                   PROGRAM.   M.I.T.  may  terminate  the  TRANSFER  PROGRAM  if
                   circumstances   beyond   M.I.T.'s   control  shall   preclude
                   continuation.  The TRANSFER PROGRAM may be extended by mutual
                   written  consent.  The  scheduling of days shall be by mutual
                   agreement between LICENSEE and the INVENTOR with the schedule
                   designed  to  minimize  impact  on other  Lincoln  Laboratory
                   commitments.  The total number of days shall be at LICENSEE's
                   request, within the limits for each INVENTOR listed below.

INVENTOR           SCHEDULED TIME AVAILABLE
--------           ------------------------

Alan Fenn          Not more than Ten (10) days  within  Twelve  (12) months from
                   the Effective Date.

3.       REIMBURSEMENT:
         --------------
          The LICENSEE agrees to reimburse M.I.T. for:

          (a)      each work day or part thereof  spent  traveling to or from or
                   working  on the  TRANSFER  PROGRAM  either  at M.I.T  Lincoln
                   Laboratory or at LICENSEE's  facilities,  in accordance  with
                   the following per them schedule:

          INVENTOR      PER DIEM                          THEREAFTER
          --------      --------                          ----------
          Alan Fenn    (Confidential Treatment            Increased by amount of
                       Requested)                         all  pay  raises  and
                       subject to change                  overhead increases.

          (b)      the  traveling  expense of the  INVENTOR in  accordance  with
                   normal M.I.T. Lincoln Laboratory Travel rules; and

          (c)      an administrative fee of (Confidential  Treatment  Requested)
                   percent of the above reimbursable costs.

4,        PAYMENT:
          --------
          Payments shall be made to M.I.T. within thirty (30) days of LICENSEE's
          receipt of invoice.

5.        NON-USE OF NAMES
          ----------------
          LICENSEE  shall not use the names or trademarks  of the  Massachusetts
          Institute of Technology,  nor any adaptation thereof, nor the names of
          any of  its  employees,  in  any  advertising,  promotional  or  sales
          literature  without prior written  consent  obtained from M.I.T.,  and
          said employee,  in each case, except that LICENSE may state that it is
          licensed by M.I.T. under one or more of the patents and/or
          applications comprising the PATENT RIGHTS.

6.        LIMITATION OF LIABILITY
          -----------------------
          LICENSEE  AGREES  THAT ALL  TECHNICAL  ASSISTANCE  PROVIDED  UNDER THE
          TRANSFER  PROGRAM  IS MADE  WITHOUT  WARRANTY  OF ANY KIND  EXPRESS OR
          IMPLIED.  Neither  M.I.T.  nor any INVENTOR  shall have any  liability
          whatsoever  to LICENSEE  or any third party in regard to the  TRANSFER
          PROGRAM,  including,  but not limited to,  technical  assistance,  and
          know-  how,  and  LICENSEE  shall  indemnify  M.I.T.  for  any and all
          liability of any kind which M.I.T. may incur in regard thereto.

                                       23
<PAGE>

7.        NOTICES:
          --------
          Any payment,  notice or other communication pursuant to this Agreement
          shall be sufficiently  made or given on the date of mailing if sent to
          such party by certified first class mail,  postage prepaid,  addressed
          to it at its address below or as it shall  designate by written notice
          given to the other party:

                       In the case of M.I.T,:

                                     Director
                                     Technology Licensing Office
                                     Massachusetts Institute of Technology
                                     Room E32-300
                                     Cambridge, Massachusetts 02139

              In the case of LICENSEE:          John Mon
                                                Cheung Laboratories, Inc.
                           please advise        10220-1 Old Columbia Road
                                                Columbia, ,41D 21046-1705

Agreed to for;

    MASSACHUSETTS INSTITUTE                   CHEUNG LABORATORIES, INC.
       OF TECHNOLOGY

By:    /s/Lita L. Nelsen                     By:     /s/Augustine Y. Cheung
       ---------------------------                   ----------------------
Name:  LITA L. NELSEN. DIRECTOR              Name:   Augustine Y. Cheung
Title: TECHNOLOGY LICENSING OFFICE           Title:  Chairman
Date:  Oct. 17, 1997                         Date:   Oct. 24, 1997



                                       24
<PAGE>


                                  ATTACHMENT A
                                  ------------

                                 WORK STATEMENT

Alan Fenn will assist Cheung Laboratories with technical questions and assist in
any  engineering  aspects of  clinical  trials  including  visits to sites where
clinical trials are being conducted.

Agreed to for;

    MASSACHUSETTS INSTITUTE                   CHEUNG LABORATORIES, INC.
       OF TECHNOLOGY

By:    /s/Lita L. Nelsen                     By:    /s/Augustine Y. Cheung
       -----------------                            ----------------------
Name:  LITA L. NELSEN. DIRECTOR              Name:  Augustine Y. Cheung
Title: TECHNOLOGY LICENSING OFFICE           Title: Chairman
Date:  Oct. 17, 1997                         Date:  Oct. 24, 1997


                                       25



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