Sample Business Contracts


License Agreement - University of California and Digirad Corp.


                                LICENSE AGREEMENT

                                       FOR


                                    DETECTOR


                                     BETWEEN


                               DIGIRAD CORPORATION



                                       AND


                   THE REGENTS OF THE UNIVERSITY OF CALIFORNIA


                                   THROUGH THE


                             ERNEST ORLANDO LAWRENCE
                          BERKELEY NATIONAL LABORATORY



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                                TABLE OF CONTENTS

1.   BACKGROUND                                                           1

2.   DEFINITIONS                                                          1

3.   LICENSE GRANT                                                        3

4.   LICENSE ISSUE FEE                                                    4

5.   ROYALTIES AND PAYMENTS                                               4

6    PERFORMANCE REQUIREMENTS                                             6

7    PROGRESS AND ROYALTY REPORTS                                         7

8.   BOOKS AND RECORDS                                                    8

9.   LIFE OF THE AGREEMENT                                                8

10.  TERMINATION BY BERKELEY LAB                                          9

11.  TERMINATION BY DIGIRAD                                               9

12.  DISPOSITION OF LICENSED PRODUCTS                                     9

13.  USE OF NAMES AND TRADEMARKS AND NONDISCLOSURE OF AGREEMENT           9

14.  LIMITED WARRANTY                                                    10

15.  PATENT PROSECUTION AND MAINTENANCE                                  11

16.  PATENT INFRINGEMENT                                                 13

17   WAIVER                                                              13

18.  ASSIGNMENT                                                          13

19.  INDEMNIFICATION                                                     13

20.  LATE PAYMENTS                                                       15


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21.  NOTICES                                                             15

22.  U.S.  MANUFACTURE                                                   15

23.  PATENT MARKING                                                      16

24.  GOVERNMENT APPROVAL OR REGISTRATION                                 16

25.  EXPORT CONTROL LAWS                                                 16

26.  FORCE MAJEURE                                                       16

27   MISCELLANEOUS                                                       16


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                         LICENSE AGREEMENT FOR DETECTOR


This license agreement (the "Agreement") is entered into by The Regents of the
University of California ("The Regents"), Department of Energy
contract-operators of the Ernest Orlando Lawrence Berkeley National Laboratory,
1 Cyclotron Road, Berkeley, CA 94720, (jointly, "Berkeley Lab"), and Digirad
Corporation, ("Digirad") a Delaware corporation, having as its principle place
of business, 9350 Trade Place San Diego, California 92126-6330.

                                  1. BACKGROUND

1.1      A certain invention, ***
                              ***
         (the "Invention"), was made under U.S. Department of Energy contract
         DE-AC03-76SF00098 at the University of California, Ernest Orlando
         Lawrence Berkeley National Laboratory by Steven Edward Holland.

1.2      As DOE sponsored development of the Invention, this Agreement and the
         resulting license are subject to overriding obligations to the federal
         government pursuant to the provisions of the applicable law or
         regulations.

1.3      Berkeley Lab wants the Invention developed and used to the fullest
         extent so that the general public enjoys the benefits of the
         government-sponsored research.

1.4      Digirad wants to obtain certain rights from Berkeley Lab for the
         commercial development, manufacture, use, and sale of the Invention.

1.5      Digirad entered into an Option Agreement with Berkeley Lab to license
         the above referenced invention on June 3, 1998.

1.6      Digirad is a "small business firm" as defined at Section 2 of Public
         Law 85-536 (15 U.S.C. 632).

Therefore the parties agree as follows:

                                 2. DEFINITIONS

2.1      "Effective Date" means the date of execution by the last signing party.

2.2      "Field of Use" means the development, production and use ***
                                             ***
                                             ***
                                             ***. The Field of Use specifically
excludes the use for *** as well as *** of all kinds.

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2.3      "Highly Inflationary Currency" means the currency of any economy with a
         cumulative inflation rate of 100% or more over the most recent three
         calendar years, as measured by consumer price indices published by the
         International Monetary Fund (International Financial Statistics),
         Washington, D.C.

2.4      "Licensed Patents" means patent rights to any subject matter claimed in
         or covered by
                                                     ***
                                                     ***
         *** or any corresponding foreign patent application or patent, for
         which Digirad has met the requirements of Section 15.2 herein; any
         division, reexamination, continuation, continuation-in-part (excluding
         new matter contained and claimed in that continuation-in-part), or of
         which such application is a successor; any patents issuing on any of
         the foregoing, and all renewals, reissues and extensions thereof, or
         other equivalents of a renewal, reissues and extension thereof.

2.5      "Licensed Product" means any product, service or process that employs
         or is produced by the practice of any invention claimed in Licensed
         Patents and whose manufacture, use, practice, sale, or lease would
         constitute, but for the license Berkeley Lab grants to Digirad under
         this Agreement, an infringement of any claim in Licensed Patents.

2.6      "Selling Price" for the purpose of computing royalties means the price
         at which Digirad or its sublicensee sells the Licensed Product in an
         arms-length transaction, less the sum of the following deductions that
         are customary and actually taken: (i) cash, trade or quantity
         discounts; (ii) sales, use, tariff, import/export duties or other
         excise taxes imposed upon particular sales; and (iii) transportation
         (and insurance charges associated with transportation) and allowances
         or credits to customers because of rejections or returns. When a
         Licensed Product is not sold, but is otherwise disposed of, the Selling
         Price of that Licensed Product for the purposes of computing royalties
         is the selling price at which products of similar kind and quality,
         sold in similar quantities, are currently being offered for sale by
         Digirad. When such products are not currently being offered for sale by
         Digirad, the Selling Price of a Licensed Product otherwise disposed of,
         for the purpose of computing royalties, is the average selling price at
         which products of similar kind and quality, sold in similar quantities,
         are then currently being offered for sale by other manufacturers. When
         such products are not currently sold or offered for sale by Digirad or
         others, then the Selling Price, for the purpose of computing royalties,
         shall be Digirad's cost of manufacture, determined by generally
         accepted accounting procedures, plus Digirad's standard mark-up. For
         sales of Licensed Products to a Joint

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         Venture or Affiliate (as defined in Paragraphs 2.7 and 2.8
         below) that are provided by Digirad to the Joint Venture or
         Affiliate (directly or indirectly for resale by said Joint Venture
         or Affiliate) at a reduced price from that customarily charged to
         an unrelated third party, then the royalty paid to Berkeley Lab
         will be based on the Selling Price of Licensed Products of the
         Joint Venture or Affiliate to the Joint Venture's or Affiliate's
         customers and subject to payment under Article 5. For sales of
         Licensed Products to a Joint Venture or Affiliate (as defined in
         Paragraphs 2.7 and 2.8 below) that are provided directly or
         indirectly by Digirad to the Joint Venture or Affiliate as an end
         user at a reduced price from that customarily charged to an
         unrelated third party, then the royalty paid to Berkeley Lab will
         be based on the customary charge to an unrelated third party in an
         arms length transaction and subject to payment under Article 5.

2.7      "Affiliate(s)" of a party means any entity which, directly or
         indirectly, controls such party, is controlled by such party or is
         under common control with such party, "control" for these purposes
         being defined as the actual, present capacity to elect a majority of
         the directors of such Affiliate.

2.8      "Joint Venture" means any separate entity established pursuant to an
         agreement between a third party and Digirad to constitute a vehicle for
         a joint venture, which separate entity purchases, sells or acquires
         Licensed Products from Digirad at prices substantially different from
         those at which Digirad would have charged other purchasers that deal at
         arms length with Digirad. If such separate entity is established, then
         Berkeley Lab shall collect from Digirad royalties on the Selling Price
         of Licensed Products by the entity and shall not collect royalties on
         the Selling Price of Licensed Products by Digirad.

                                3. LICENSE GRANT

3.1      Subject to the limitations set forth in this Agreement, Berkeley Lab
         grants to Digirad a nontransferable (subject to Section 18.1), limited
         (by the terms of Sections 3.2 and 3.7) worldwide exclusive,
         royalty-bearing license, under Licensed Patents, only in the Field of
         Use, to develop, make, have made, use, practice, sell, have sold, and
         lease the Licensed Products.

3.2      Any license under this Agreement is subject to the following: (a) DOE's
         royalty-free license for federal government practice only, and (b)
         DOE's option to grant licenses either if reasonable steps to
         commercialize the Invention are not carried out or in order to meet
         federal regulations. Digirad shall use best efforts to commercialize
         Licensed Patents.

3.3      Berkeley Lab also grants to Digirad the right to issue royalty-bearing
         sublicenses only in the Field of Use to make, use, practice and sell
         Licensed Products, so long as Digirad has current exclusive rights in
         the Field of Use.

3.4      Any sublicense Digirad grants must be consistent with all the rights
         and obligations due Berkeley Lab and the United States Government under
         this Agreement, including, without limitation, the obligations under
         Section 3.2 above.

3.5      Digirad shall provide Berkeley Lab with a copy of each sublicense
         issued under this Agreement; collect payment of all royalties due
         Berkeley Lab from sublicensees; and summarize and deliver all reports
         due Berkeley Lab from sublicensees under Article 7 (PROGRESS AND
         ROYALTY REPORTS).

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3.6      If this Agreement terminates for any reason, Berkeley Lab, at its sole
         discretion, shall determine whether Digirad must cancel or assign to
         Berkeley Lab any or all sublicenses.

3.7      Berkeley Lab expressly reserves the right to use the Invention and
         associated technology for educational and research purposes subject to
         the limitations of Section 13.2.

                              4. LICENSE ISSUE FEE

4.1      Digirad shall pay Berkeley Lab a license issue fee of *** dollars
         ($***) of which *** dollars ($***) has been previously paid under the
         Option Agreement. The remaining *** dollars ($***) shall be paid in
         equal installments as follows: *** dollars ($***) within fifteen (15)
         days of the Effective Date and *** dollars ($***) on the first
         anniversary of this Agreement.

4.2      This fee is                        ***

                            5. ROYALTIES AND PAYMENTS

5.1        Digirad shall pay to Berkeley Lab an earned royalty ***
         *** of the Selling Price of each Licensed Product Digirad sells.

5.2      Under this Agreement a Licensed Product is considered to be sold when
         invoiced, or if not invoiced, when delivered to a third party. But when
         the last patent covering a Licensed Product expires or when the license
         terminates, any shipment made on or before the day of that expiration
         or termination that has not been billed out before is considered as
         sold (and therefore subject to royalty) unless returned to Digirad
         within ninety (90) days. Berkeley Lab shall credit royalties that
         Digirad pays on a Licensed Product that the customer does not accept or
         returns.

5.3      For each sublicense, Digirad shall pay Berkeley Lab the same royalties
         it would pay if Digirad was making, using, or selling Licensed Products
         under this Agreement. Royalties shall be calculated by applying the
         percentages due on the sale of Licensed Product (see Section 5.1.
         above) hereunder against the Selling Price for which the Sublicensee
         has sold Licensed Product. The royalties paid to Digirad may exceed the
         royalties paid to Berkeley Lab.

5.4      Digirad shall pay to Berkeley Lab by August 31 of each year the
         difference between the earned royalties for that calendar year Digirad
         has already paid to Berkeley Lab and the minimum annual royalty set
         forth in the following schedule. Berkeley Lab shall credit that
         minimum annual royalty paid against the earned royalty due and owing
         for the calendar year in which Digirad made the minimum payment

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              CALENDAR YEAR                            MINIMUM ANNUAL ROYALTY
              -------------                            ----------------------
                                                    
                  1999                                 $ ***
                  2000                                 $ ***
                  2001                                 $ ***
                  2002 and each year thereafter        $ ***


5.5      Digirad shall send payment for royalties accruing to Berkeley Lab
         quarterly together with its royalty report under paragraph 7.4. Digirad
         shall be entitled to credit interference and opposition expenses
         against the earned royalty income due Berkeley Lab so long as such
         expenses do not arise from any opposition or interference raised by
         Digirad, its Affiliates, or Joint Ventures or Joint Venture members.

5.6      Digirad shall make checks payable to "The Regents of the University of
         California (Berkeley Lab/L-99-1261.)" Digirad shall pay Berkeley Lab
         only in United States dollars. If a Licensed Product is sold for moneys
         other than United States dollars (not including Highly Inflationary
         Currency), Digirad shall first determine the earned royalties in the
         foreign currency of the country in which the Licensed Product was sold
         and then convert them into equivalent United States dollars at the
         closing exchange rate published by THE WALL STREET JOURNAL on the last
         business day of the reporting period. If a Licensed Product is sold for
         a Highly Inflationary Currency, Digirad shall convert the sales subject
         to royalties into equivalent United States funds using the closing
         exchange rates in effect on the date of invoicing (or if no invoicing,
         of delivery) as published by THE WALL STREET JOURNAL. Digirad shall
         quote the exchange rate in the Continental method (local currency per
         U.S. dollar).

5.7      Digirad may not reduce royalties payable by any value-added taxes,
         fees, or other charges imposed on the remittance of royalty income
         imposed by the government of any State of the United States or the
         government of any country. Digirad is also responsible for all bank
         transfer charges.

5.8      If Digirad cannot promptly remit any royalties for sales in any country
         where a Licensed Product is sold because of legal restrictions, Digirad
         may deposit in United States funds royalties due Berkeley Lab to
         Berkeley Lab's account in a bank or other depository in that country.
         If Digirad is not permitted to deposit those payments in U.S. funds
         under the laws of that country, Digirad may deposit those payments in
         the local currency to Berkeley Lab's account in a bank or other
         depository in that country.

5.9      If a court of competent jurisdiction and last resort holds invalid any
         patent or any of the patent claims within Licensed Patent in a final
         decision from which no appeal has or can be taken, Digirad's obligation
         to pay royalties based on that patent or claim will cease as of the
         date of that final decision. Digirad, however, shall pay any royalties
         that accrued before that decision or that are based on another patent
         or claim not involved in that decision.

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5.10     Digirad has no duty to pay Berkeley Lab royalties under this Agreement
         on a Licensed Product Digirad sells to the United States Government
         including any United States Government agency. Digirad shall reduce the
         amount charged for a Licensed Product sold to the United States
         Government by an amount equal to the royalty otherwise due Berkeley
         Lab. Such royalty otherwise due Berkeley Lab will count towards the
         minimum annual royalty payments per Section 5.4.

                           6. PERFORMANCE REQUIREMENTS

6.1      Digirad shall proceed with the development, manufacture and sale of
         Licensed Products and shall use diligent commercial efforts to endeavor
         to market them within a reasonable time after the Effective Date in
         quantities sufficient to meet the market demand.

6.2      Digirad shall use diligent commercial efforts to obtain all necessary
         governmental approvals for the manufacture, use and sale of Licensed
         Products.

6.3      Digirad is entitled to exercise prudent and reasonable business
         judgment in meeting its performance requirements under this Agreement.

6.4      If Digirad is unable to perform any of the following, then Berkeley Lab
         may either terminate this Agreement or reduce this limited exclusive
         license to a nonexclusive license:

                  6.4.1    complete marketing preparation and product
                           introduction of the Licensed Products to the
                           marketplace by June 30, 1999; or

                  6.4.2    at any time during the exclusive period of this
                           Agreement, reasonably fill the market demand for
                           Licensed Products following commencement of
                           marketing.

         It is the understanding of the parties hereto that any termination of
         the Agreement or reduction of this license to a nonexclusive license as
         a result of Digirad's failure to meet the specifications of Section
         6.4, shall be subject to the sixty (60) day cure period set forth in
         Section 10.1 below.

6.5      If Berkeley Lab grants a non-exclusive license to any other party upon
         royalty rates more favorable than those of this Agreement after
         reducing this license to a non-exclusive license, then Digirad is
         entitled to the benefit of the more favorable rates. Digirad must agree
         in writing to accept all terms of that third party license in whole and
         not in part in order to enjoy the benefit of the more favorable rates
         which shall commence upon delivery to Berkeley Lab of that written
         agreement.

6.6      Digirad and Berkeley Lab by mutual written consent may amend or extend
         the requirements of Sections 6.4.1-6.4.2 at the written request of
         Digirad in response to legitimate business reasons.

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                         7. PROGRESS AND ROYALTY REPORTS

7.1      Beginning June 1, 1999 and semi-annually thereafter, Digirad shall
         submit to Berkeley Lab a progress report covering Digirad's activities
         related to the development and testing of all Licensed Products and the
         obtaining of the governmental approvals necessary for marketing.
         Digirad shall make these progress reports for each Licensed Product
         until the first commercial sale of that Licensed Product occurs
         anywhere in the world.

7.2      The progress reports Digirad submits under Section 7.1 must include,
         but not be limited to, the following topics:

         7.2.1    summary of work completed related to the requirements of
                  Section 6.4;

         7.2.2    key scientific discoveries;

         7.2.3    summary of work in progress;

         7.2.4    current schedule of anticipated milestones;

         7.2.5    market plans for introduction of Licensed Products; and

         7.2.6    number of full-time equivalent (FTEs) employees or agents
                  working on the development of Licensed Products.

7.3      Digirad shall also report to Berkeley Lab in its immediately subsequent
         royalty report on the date of first commercial sale of each Licensed
         Product in the U.S. and in each other country.

7.4      After the first commercial sale of a Licensed Product anywhere in the
         world, Digirad shall make quarterly royalty reports to Berkeley Lab on
         or before February 28, May 31, August 31 and November 30 of each year.
         Each royalty report must cover the most recently completed calendar
         quarter and must show:

         7.4.1    the Selling Price of each type of Licensed Product sold by
                  Digirad;

         7.4.2    the number of each type of Licensed Product sold;

         7.4.3    the royalties, in U.S. dollars, payable under this Agreement
                  on those sales;

         7.4.4    the exchange rates used in calculating the royalty due;

         7.4.5    the royalties on government sales that otherwise would have
                  been due under Section 5.10; and

         7.4.6    for each sublicense, if any:

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                  7.4.6.1    the sublicensee;

                  7.4.6.2  the number, description, and aggregate Selling Prices
                           of Licensed Products that the sublicensee sold or
                           otherwise disposed of;

                  7.4.6.3  the exchange rates used in calculating the royalties
                           due Berkeley Lab from the sublicensee's sales.

7.5      If no sales of Licensed Products have been made during any reporting
         period, Digirad shall make a statement to this effect.

                              8. BOOKS AND RECORDS

8.1      Digirad shall keep books and records accurately showing all Licensed
         Products manufactured, used, or sold under the terms of this Agreement.
         Digirad shall preserve those books and records for at least five (5)
         years from the date of the royalty payment to which they pertain and
         shall open them to inspection by representatives or agents of Berkeley
         Lab at reasonable times. Digirad shall provide an audited statement to
         Berkeley Lab annually at such time as Digirad completes its corporate
         audited financial statements.

8.2      Berkeley Lab shall bear the fees and expenses of Berkeley Lab's
         representatives performing the examination of the books and records.
         But if the representatives discover an error resulting in a deficiency
         in royalties of more than *** of the total royalties due for any year,
         then Digirad shall bear the fees and expenses of these representatives
         and the difference between the earned royalties and the reported
         royalties (which shall be subject to the provisions of Article 20 (LATE
         PAYMENTS)).

                            9. LIFE OF THE AGREEMENT

9.1      Unless otherwise terminated by operation of law or by acts of the
         parties in accordance with the terms of this Agreement, this Agreement
         is in force from the Effective Date and expires concurrently with the
         last-to-expire Licensed Patent.

9.2      Any termination of this Agreement shall not affect the rights and
         obligations set forth in the following Articles:

                  Article 8         Books and Records

                  Article 12        Disposition of Licensed Products on Hand
                                    upon Termination

                  Article 13        Use of Names and Trademarks and
                                    Nondisclosure of Agreement

                  Article 14        Limited Warranty

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                  Article 19        Indemnification

                  Article 25        Export Control Laws

9.3      Termination does not affect in any manner any rights of Berkeley Lab or
         Digirad arising under this Agreement before the termination.

                         10. TERMINATION BY BERKELEY LAB

10.1     If Digirad violates or fails to perform any material term of this
         Agreement, then Berkeley Lab may give written notice of such default
         ("Default Notice") to Digirad. If Digirad fails to cure that default
         and provide Berkeley Lab with reasonable evidence of the cure within
         sixty (60) days of the Default Notice, Berkeley Lab may terminate this
         Agreement and the licenses granted by a second written notice
         ("Termination Notice") to Digirad. If Berkeley Lab sends a Termination
         Notice to Digirad, this Agreement automatically terminates on the
         effective date of the Termination Notice.

                           11. TERMINATION BY DIGIRAD

11.1     Digirad at any time may terminate this Agreement in whole or as to any
         portion of Licensed Patents by giving written notice to Berkeley Lab.
         Digirad's termination of this Agreement will be effective ninety (90)
         days after its notice. If that termination is without cause within
         three years of the Effective Date, Digirad shall pay Berkeley Lab as
         liquidated damages *** with the notice of termination before that
         notice is effective.

          12. DISPOSITION OF LICENSED PRODUCTS ON HAND UPON TERMINATION

12.1     Within forty-five (45) days of termination of this Agreement for any
         reason, Digirad shall provide Berkeley Lab with a written
         inventory of all Licensed Products in process of manufacture or in
         stock. Digirad shall make diligent efforts to dispose of those
         Licensed Products within one hundred twenty (120) days Licensed
         Product of termination. The sale of any Licensed Product within
         one hundred twenty (120) days is subject to the terms of this
         Agreement. Digirad shall cease sales of Licensed Product one hundred
         twenty (120) days after termination.

         13. USE OF NAMES AND TRADEMARKS AND NONDISCLOSURE OF AGREEMENT

13.1     In accordance with California Education Code Section 92000, Digirad
         shall not use in advertising, publicity or other promotional activities
         any name, trade name, trademark, or other designation of the University
         of California, nor shall Digirad so use "Berkeley Lab" (including any
         contraction, abbreviation, or simulation of any of the foregoing)
         without

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         Berkeley Lab's prior written consent. As the sole exception to the
         above prohibition, Digirad shall give appropriate credit to the
         inventor(s) and Berkeley Lab at scientific symposia, and in technical
         publications in scientific journals where the licensed technology is
         referenced. Berkeley Lab shall not use in advertising, publicity or
         other promotional activities any name, trade name, or other designation
         of Digirad without its prior written consent except as set forth in
         Section 13.2 below.

13.2     Neither party may disclose the terms or existence of this Agreement to
         a third patty without express written permission of the other party,
         except when required under either the California Public Records Act or
         other applicable law or court order or by Berkeley Lab's contracts with
         the DOE or any other Federal or State entity. Notwithstanding the
         foregoing, Berkeley Lab may disclose the existence of this Agreement
         and the extent of the grant in Article 3, but shall not otherwise
         disclose the terms of this Agreement, except to the DOE.

13.3     The Proprietary Information Exchange Agreement between Digirad and the
         Regents of the University of California as Managers of the Lawrence
         Berkeley National Laboratory, as attached hereto as Exhibit A, shall
         remain in effect through the term outlined in the Proprietary
         Information Exchange Agreement.

                              14. LIMITED WARRANTY

14.1     Berkeley Lab warrants to Digirad that it has the lawful right to grant
         this license.

14.2     Except as set forth above, this license and the associated Invention(s)
         are provided WITHOUT WARRANTY OF MERCHANTABILITY OR FITNESS FOR A
         PARTICULAR PURPOSE OR ANY OTHER WARRANTY, EXPRESS OR IMPLIED. BERKELEY
         LAB MAKES NO REPRESENTATION OR WARRANTY THAT LICENSED PRODUCTS WILL NOT
         INFRINGE ANY PATENT OR OTHER PROPRIETARY RIGHT.

14.3     IN NO EVENT WILL BERKELEY LAB OR DIGIRAD BE LIABLE FOR ANY INCIDENTAL,
         SPECIAL OR CONSEQUENTIAL DAMAGES INCURRED BY THE OTHER PARTY HERETO
         RESULTING FROM EXERCISE OF THIS LICENSE OR THE USE OF THE INVENTION(S)
         OR LICENSED PRODUCTS UNDER THIS AGREEMENT. THIS PROVISION, 14.3, DOES
         NOT APPLY TO INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES AWARDED IN A
         JUDGEMENT FOR A THIRD PARTY AGAINST A PARTY OR THE PARTIES HERETO.

14.4     Except as set forth above, nothing in this Agreement may be construed
         as:

         14.4.1   a warranty or representation by Berkeley Lab as to the
                  validity or scope of any of Berkeley Lab's rights in Licensed
                  Patents;


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         14.4.2   a warranty or representation that anything made, used, sold or
                  otherwise disposed of under any license granted in this
                  Agreement is or will be free from infringement of patents of
                  third parties;

         14.4.3   an obligation to bring or prosecute actions or suits against
                  third parties for patent infringement, except as specifically
                  provided for in Article 16 (Patent Infringement);

         14.4.4   a grant by implication, estoppel or otherwise of any license
                  or rights under any patents of Berkeley Lab other than
                  Licensed Patents, regardless of whether such patents are
                  dominant or subordinate to Licensed Patents; or

         14.4.5   an obligation to furnish any know-how not provided in Licensed
                  Patents.

                     15. PATENT PROSECUTION AND MAINTENANCE

15.1     Berkeley Lab shall diligently maintain the United States patents for
         Licensed Patents (including any future patent rights provided for in
         Section 2.4) using counsel of its choice that is reasonably acceptable
         to Digirad. Berkeley Lab shall bear the cost of pre-paring, filing,
         prosecuting and maintaining any United States patent covered by this
         Agreement.

15.2     Berkeley Lab has filed foreign patent applications corresponding to the
         PCT Application referred to in Section 2.4 (namely US 97/20173) as
         follows:

(a)    European Patent Office (EPO), designating

(i) Austria

(ii) Belgium

(iii) Switzerland

(iv) Germany

(v) Denmark

(vi) Spain

(vii) France

(viii) United Kingdom

(ix) Ireland

(x) Italy

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(xi) Netherlands

(xii) Sweden

(b) Japan.

Berkeley Lab has no obligation to take action to file or prosecute foreign
patent applications on behalf of Digirad until the following occurs:

         15.2.1   (With the exception of the three countries listed in 15.3
                  below) Digirad makes that request in writing to Berkeley Lab
                  within thirty (30) days after the Effective Date. The absence
                  of the required notice from Digirad to Berkeley Lab acts as
                  an election not to proceed on protecting foreign rights.

         15.2.2   That notice also identifies the countries Digirad desires.

         15.2.3   Digirad pays Berkeley Lab the foreign license fee as set forth
                  in paragraph 15.4

15.3     Digirad agrees to pay Berkeley Lab *** dollars ($***), upon the day
         of execution of this Agreement, for the foreign patent counterparts
         to the U.S. application for the following countries: Germany, France
         and Japan.

15.4     The foreign license fee for each foreign counterpart in addition to
         those listed in Section 15.3 to a United States patent application
         shall be *** dollars ($***) for each national filing or for each
         country designated in the PCT filing for entry into the national
         phase, European Patent Convention ("EPC") filing, or similar regional
         filing.

15.5     Berkeley Lab shall bear the expense of preparing, filing, prosecuting
         and securing all foreign patent applications that Berkeley Lab files at
         Digirad's request (pursuant to 15.2 above). Digirad shall bear the
         expense of any interference or oppositions and maintaining all
         resulting patents. Berkeley Lab will hold those patents in its name and
         obtain them using counsel of its choice that is reasonably acceptable
         to Digirad.

15.6     Berkeley Lab shall promptly provide Digirad with copies of all relevant
         documentation so that Digirad is informed of the continuing prosecution
         of Licensed Patents and any foreign patent applications Berkeley Lab
         files under Section 15.2. Additionally, Berkeley Lab shall provide
         Digirad a quarterly report at the end of March, June, September, and
         December of each year summarizing the status of the Licensed Patents
         and any foreign patent applications Berkeley Lab files under Section
         15.2. Digirad shall keep this documentation confidential. Berkeley Lab
         shall use all reasonable efforts to amend any patent application to
         include claims reasonably requested by Digirad to protect the products
         contemplated to be sold under this Agreement.

*** Portions of this page have been omitted pursuant to a request for
    Confidential Treatment and filed separately with the Commission.


                                    12 of 17
<Page>

                             16. PATENT INFRINGEMENT

16.1     If either party learns of the substantial infringement of any of
         Licensed Patents, the party shall so inform the other party in writing
         and shall provide the other party with reasonable evidence of the
         infringement. During the period and in a jurisdiction where Digirad has
         exclusive rights under this Agreement, neither party may notify a third
         party of the infringement of any of Licensed Patents without first
         obtaining written consent of the other party, which consent shall not
         be unreasonably denied or delayed. Both parties shall use their best
         efforts in cooperation with each other to terminate such infringement
         without litigation.

16.2     Digirad may request that Berkeley Lab take legal action against the
         infringement of Licensed Patents. Digirad shall make that request in
         writing and include reasonable evidence of the infringement and damages
         to Digirad. If the infringing activity has not been abated within
         ninety (90) days of that request, Berkeley Lab may elect to: (a)
         commence suit on its own account; or (b) refuse to participate in the
         suit. Berkeley Lab shall give written notice of its election to Digirad
         by the end of the ninetieth (90th) day after receiving notice of the
         request from Digirad. Digirad may thereafter bring suit for patent
         infringement only if Berkeley Lab elects not to commence suit (other
         than as nominal party plaintiff) and if the infringement occurred
         during the period and in a jurisdiction where Digirad has exclusive
         rights under this Agreement. In such event, Digirad shall have the sole
         control and sole decision making authority with respect to defending
         and enforcing the Licensed Patents solely in connection with such suit
         and further provided that Berkeley Lab does not thereafter join such
         suit. If, however, Digirad elects to bring suit in accordance with this
         paragraph, Berkeley Lab may thereafter join such suit at its own
         expense.

16.3     Such legal action as is decided upon must be at the expense of the
         party on account of whom suit is brought and all consequent recoveries
         belong to that party. But if Berkeley Lab and Digirad jointly bring
         legal action and fully participate in it, the parties must jointly
         share both the expense and all recoveries in proportion to the share of
         expense each party pays.

16.4     Each party shall cooperate with the other in litigation proceedings,
         including without limitation, signing and arranging for the signature
         on documents, joining actions as nominal party and similar actions,
         instituted under this Agreement but at the expense of the party on
         account of whom suit is brought. The party bringing the suit will
         control that litigation, except that Berkeley Lab may elect to be
         represented by counsel of its choice, at its sole expense, in any suit
         brought by Digirad.

                                   17. WAIVER

17.1     The waiver of any breach of any term of this Agreement does not waive
         any other breach of that or any other term.

                                 18. ASSIGNMENT

18.1     This Agreement is binding upon and shall inure to the benefit of
         Berkeley Lab, its successors and assigns. Upon written notice to
         Berkeley Lab, Digirad may assign this Agreement to a Digirad wholly
         owned subsidiary or to a purchaser or acquirer of all or substantially
         all of the business or assets of Digirad. Any other attempt by Digirad
         to assign this Agreement is void unless Digirad obtains the prior
         written consent of Berkeley Lab. Berkeley Lab shall not unreasonably
         withhold or delay that consent.

                               19. INDEMNIFICATION

19.1     Digirad shall indemnify, hold harmless and defend Berkeley Lab and the
         U.S. Government and their officers, employees, and agents; the sponsors
         of the research that led to the Invention; and the inventors of the
         patents and patent applications in Licensed Patents against any and all
         claims, suits, losses, damage, costs, fees, and expenses resulting from
         or arising out of exercise of this license or any sublicense. Berkeley
         Lab shall promptly notify Digirad in writing of any claim or suit
         brought against Berkeley Lab in respect of which Berkeley Lab intends
         to invoke the provisions of this Article 19

                                    13 of 17
<Page>


         (INDEMNIFICATION). No settlement of any claim, suit or perceived
         threat thereof received by Berkeley Lab shall be made without the
         approval of Digirad if indemnification is sought by Berkeley Lab
         hereunder unless require by final decree of a court of competent
         jurisdiction. Digirad shall pay all reasonable costs incurred by
         Berkeley Lab in enforcing this indemnification, including
         reasonable attorney fees.

19.2     Digirad, at its sole expense, shall insure its activities in connection
         with the work under this Agreement and obtain and keep in force
         Comprehensive or Commercial Form General Liability Insurance
         (contractual liability and products liability included) or equivalent
         program of self-insurance with limits as follows:

         19.2.1   Each Occurrence                                     $1,000,000
         19.2.2   Products/Completed Operations Aggregate             $5,000,000
         19.2.3   Personal and Advertising Injury                     $1,000,000
         19.2.4   General Aggregate (commercial form only)            $5,000,000

19.3     The coverages and limits referred to in this Article 19 do not in any
         way limit the liability of Digirad. Digirad shall furnish Berkeley Lab
         with certificates of insurance, including renewals, evidencing
         compliance with all requirements at least thirty (30) days prior to
         the first commercial sale, use, practice or distribution of a Licensed
         Product.

         19.3.1   If such insurance is written on a claims-made form, coverage
                  shall provide for a retroactive date of placement on or before
                  the Effective Date.

         19.3.2   Digirad shall maintain the general liability insurance
                  specified during: (a) the period that the Licensed Product is
                  being commercially distributed or sold (other than for the
                  purpose of obtaining regulatory approvals) by Digirad or by a
                  sublicensee or agent of Digirad, and (b) a reasonable period
                  thereafter, but in no event less than five years.

19.4     The insurance coverage of Section 19.2 must:

         19.4.1   Provide for thirty (30) day advance written notice to
                  Berkeley Lab of any modification of any such coverage and
                  provide immediate notice of cancellation of such coverage.

         19.4.2   Indicate that DOE and "The Regents of the University of
                  California" are endorsed as additional insureds, but only with
                  respect to the subject matter of this Agreement.

         19.4.3   Include a provision that the coverages are primary and do not
                  participate with, nor are excess over, any valid and
                  collectible insurance or program of self-insurance carried or
                  maintained by Berkeley Lab.

                                    14 of 17
<Page>

                                20. LATE PAYMENTS

20.1     Excepting issues arising from Section 26.1, if Digirad does not make a
         payment to Berkeley Lab when due, Digirad shall pay to Berkeley Lab
         such reasonable administrative fees and interest as Berkeley Lab
         generally charges third parties on overdue accounts, such interest not
         to exceed eight percent (8%) simple interest per annum.

                                   21. NOTICES

21.1     Any payment, notice or other communication this Agreement requires or
         permits either party to give must be in writing to the appropriate
         address given below, or to such other address as one party designates
         by written notice to the other party. The parties deem payment, notice
         or other communication to have been properly given and to be effective
         (a) on the date of delivery if delivered in person; (b) on the fourth
         day after mailing if mailed by first-class mail, postage paid; (c) on
         the second day after delivery to an overnight courier service such as
         Federal Express, if sent by such a service; or (d) upon confirmed
         transmission by telecopier. The parties addresses are as follows:

         For payments to Berkeley Lab:       For all other notices to
                                             Berkeley Lab:

         Ernest Orlando Lawrence             Ernest Orlando Lawrence
         Berkeley National Laboratory        Berkeley National Laboratory
         Accounting/Financial Management     Technology Transfer Department
         P.O. Box 528                        Mailstop 90-1070
         Berkeley, California 94701          One Cyclotron Road
         Attention: Licensing Accountant     Berkeley, California 94720
         Fax: 510/486-5995                   Attention: Licensing Manager
         Telephone: 510/486-7113             Fax: 510/486-6457
                                             Telephone: 510/486-6467

         In the case of Digirad:

         Digirad Corporation
         9350 Trade Place
         San Diego, California 92126-6334
         Attention:  President
         Fax:  619-549-7714
         Telephone:  619-578-5300

                              22. U.S. MANUFACTURE

22.1     Digirad shall have Licensed Products produced for sale in the United
         States manufactured substantially in the United States so long as
         Digirad has current exclusive rights in the Field of Use.

                                    15 of 17
<Page>

                               23. PATENT MARKING

23.1     Digirad shall mark all Licensed Products made, used or sold under this
         Agreement, or their containers, in accordance with the applicable
         patent marking laws.

                     24. GOVERNMENT APPROVAL OR REGISTRATION

24.1     If the law of any nation requires that any governmental agency either
         approve or register this Agreement or any associated transaction,
         Digirad shall assume all legal obligations to do so. Digirad shall
         notify Berkeley Lab if it becomes aware that this Agreement is subject
         to a U.S. or foreign government reporting or approval requirement.
         Digirad shall make all necessary filings and pay all costs, including
         fees, penalties, and all other costs associated with such reporting or
         approval process. Berkeley Lab shall fully cooperate with Digirad, to
         the extent it is able to do so within the law and established Berkeley
         Lab policy, to provide documentation and testimony to obtain such
         approval or registration, at Digirad's sole expense.

                             25. EXPORT CONTROL LAWS

25.1     Digirad shall observe all applicable United States and foreign laws and
         regulations with respect to the transfer of Licensed Products and
         related technical data, including, with-out limitation, the
         International Traffic in Arms Regulations (ITAR) and the Export
         Administration Regulations.

                                26. FORCE MAJEURE

26.1     If a party's performance required under this Agreement is rendered
         impossible or unfeasible due to any catastrophes or other major events
         beyond its reasonable control, including, without limitation, the
         following, the parties are excused from performance, war, riot, and
         insurrection; laws, proclamations, edicts, ordinances or regulations;
         strikes, lockouts or other serious labor disputes; and floods, fires,
         explosions, or other natural disasters. When such events abate, the
         parties' respective obligations under this Agreement must resume.

                                27. MISCELLANEOUS

27.1     The headings of the several sections are inserted for convenience of
         reference only and are not intended to be a part of or to affect the
         meaning or interpretation of this Agreement.

27.2     This Agreement is not binding upon the parties until it is signed below
         on behalf of each party.

27.3     No amendment or modification hereof shall be valid or binding upon the
         parties unless made in writing and signed on behalf of each party.


                                    16 of 17
<Page>

27.4     This Agreement embodies the entire and final understanding of the
         parties on this subject. It supersedes any previous representations,
         agreements, or understandings, whether oral or written.

27.5     If a court of competent jurisdiction holds any provision of this
         Agreement invalid, illegal or unenforceable in any respect, this
         Agreement must be construed as if that invalid or illegal or
         unenforceable provision is severed from the Agreement, provided,
         however, that the parties shall negotiate in good faith substitute
         enforceable provisions that most nearly effect the parties' intent in
         entering into this Agreement.

27.6     This Agreement must be interpreted under California law without regard
         to principles of conflicts of laws.

Berkeley Lab and Digirad execute this Agreement in duplicate originals through
their duly authorized respective officers in one or more counterparts, that
taken together, are but one instrument.

THE REGENTS OF THE UNIVERSITY               DIGIRAD CORPORATION
OF CALIFORNIA, THROUGH THE
ERNEST ORLANDO LAWRENCE
BERKELEY NATIONAL LABORATORY

By    /S/ PIERMARIA T. ODDONE             By       /S/ SCOTT HUENNEKENS
   -----------------------------             ---------------------------------
                  (signature)                          (signature)

By      PIERMARIA T.  ODDONE              By         SCOTT HUENNEKENS
   ------------------------------            ---------------------------------
            (Please Print)                            (Please Print)

Title    DEPUTY DIRECTOR                  Title    PERS. & COO
      ---------------------------                -----------------------------

Date     MAY 16, 1999                     Date     5-19, 1999
     ----------------------------              -------------------------------




Approved as to form


         /S/ GLENN R. WOODS
----------------------------------------
GLENN R. WOODS
LAWRENCE BERKELEY NATIONAL LABORATORY


                                    17 of 17
<Page>

                         Exhibit A to License Agreement

                   PROPRIETARY INFORMATION EXCHANGE AGREEMENT

         This AGREEMENT made and entered into as of this 23rd day of April 1,
1999 by and between DIGIRAD, a Delaware corporation, whose address is 9350 Trade
Place, San Diego, California 92126-6334 and The Regents of the University of
California as Managers of the Lawrence Berkeley National Laboratory, whose
address is 1 Cyclotron Road, Berkeley, CA 94720.

         WHEREAS, the parties hereto are undertaking negotiations towards the
development of a license agreement between them, and

         WHEREAS, in furtherance of such license, each undersigned party (the
"Receiving Party") understands that the other party (the "Disclosing Party") has
disclosed or may disclose information relating to the Disclosing Party's
business and/or intellectual property (including, without limitation, chemical
formulas, computer programs, software, technical drawings, names and expertise
of employees and consultants, know-how, formulas processes, ideas, inventions
(whether patentable or not), schematics and other technical business, financial,
customer and product development plans, forecasts, strategies and information,
and any and all information, technical or otherwise related to describing
Digirad's ***
                                            ***
                                            ***
sub-assemblies and related assemblies for use in medical imaging systems and
other applications), information which to the extent previously, presently, or
subsequently disclosed to the Receiving Party is hereinafter referred to as
"Proprietary Information" of the Disclosing Party.

         NOW, THEREFORE, in consideration of the parties' discussions and any
access the Receiving Party may have to Proprietary Information of the Disclosing
Party, the parties agree that any information received by one party from the
other shall be governed by the following terms and conditions:

Definition:

         "Proprietary Information" shall not include information which:

         (a)      was rightfully in possession of or known to the Receiving
Party prior to receiving it from the Disclosing Party; or

         (b)      is or becomes part of the public knowledge or literature by
acts other than those of the Receiving Party and without fault of the receiving
Party; or

         (c)      was rightfully disclosed to the Receiving Party by a third
party provided the Receiving Party complies with restrictions imposed by the
third party; or

         (d)      is transmitted after the expiration of this Agreement; or

*** Portions of this page have been omitted pursuant to a request for
    Confidential Treatment and filed separately with the Commission.


                                     1 of 4
<Page>

         (e)      is disclosed by the Receiving Party under a valid order
created by a court or government agency, provided that the Receiving Party
provides prior written notice to the Disclosing Party of such obligation and the
opportunity to oppose such disclosure.

         (f)      the Receiving Party develops independently, subsequent to
receipt of Proprietary Information and for which Receiving Party can demonstrate
by written records that independent development occurred without knowledge or
use of Proprietary Information.

HANDLING OF PROPRIETARY INFORMATION:

         The Receiving Party agrees to (i) hold the Disclosing Party's
Proprietary Information in strict confidence as a fiduciary and to take
reasonable precautions to protect such Proprietary Information and (ii) handle
the Proprietary Information in the same manner that it handles its own
proprietary information of like importance, but with at least reasonable degree
of care, for a period of five (5) years after the date of disclosure.

LIMITATION ON DISCLOSURE:

         The Receiving Party shall not disclose, in whole or in part, such
Proprietary Information to any third party without the prior written consent of
the Disclosing Party for the period that such information is to be handled as
proprietary. The Receiving Party may disclose Proprietary Information only to
those of its employees who would require knowledge of such Proprietary
Information for the purposes contemplated by this Agreement and who is similarly
bound in writing.

LIMITATION OF USE:

         The Receiving Party shall make no use, in whole or in part, of any such
Proprietary Information other than in furtherance of the purpose of this
Agreement without the prior written consent of the Disclosing Party.

         If the purpose of the information exchange is the preparation of a
proposal to the United States Government, Proprietary Information of either
party may be incorporated into the proposal to the United States Government,
provided that the proposal document bears the restrictive legend contained in
Federal Acquisition Regulation 52.215-12 or a substantially similar successor
provision.

TERM:

         This Agreement shall expire one (1) year from the date recited in the
first paragraph of this Agreement. With the exception of information disclosed
in accordance with the provisions of the License Agreement for Detector between
Digirad Corporation and the Regents of the University of California through the
Ernest Orlando Lawrence Berkeley Laboratory, immediately upon a request by the
Disclosing Party at any time (which will be effective if actually received or
three days after mailed first class postage prepaid to the Receiving Party's
address herein), the Receiving Party will turn over to the Disclosing Party all
Proprietary Information of the Disclosing Party and all documents or media
containing any such Proprietary Information and any and all copies or extracts
thereof. The Receiving Party understands that


                                     2 of 4
<Page>

nothing herein (i) requires the disclosure of any Proprietary Information of the
Disclosing Party, which shall be disclosed if at all solely at the option of the
Disclosing Party (in particular, but without limitation, any disclosure is
subject to compliance with expert control laws and regulations), or (ii)
requires the Disclosing Party to proceed with any proposed transaction or
relationship in connection with which Proprietary Information may be disclosed.
The party's obligations with respect to Proprietary Information disclosed to it
prior to expiration/termination shall survive expiration/termination.

RELATIONSHIP OF PARTIES:

         This Agreement is intended to provide only for the handling and
protection of Proprietary Information exchanged or disclosed hereunder, and
shall not be construed as a Teaming, Joint Venture, Partnership, or other
similar arrangement. Specifically, this Agreement shall not be construed in any
manner to be an obligation to enter into a contract, nor shall it result in any
claim whatsoever for reimbursement of costs.

NO LICENSE:

         Neither the execution of this agreement nor the furnishing of any
Proprietary Information hereunder shall be construed as granting either
expressly, by implication, estoppel or otherwise, any license other than as
expressly set forth herein under any invention, patent, copyright, trade secret,
mask work right, or any other intellectual property right, now or hereafter
owned or controlled by the party furnishing same.

U.S.  GOVERNMENT REGULATIONS:

         A party receiving Proprietary Information shall comply with all
relevant United States Government regulations, including the International
Traffic in Arms Regulations and the Export Administration Act.

MISCELLANEOUS:

         Each party shall perform its respective obligations hereunder without
charge to the other.

         Except to the extent permitted by the License Agreement for Detector
between Digirad Corporation and the Regents of the University of California
through the Ernest Orlando Lawrence Berkeley Laboratory, neither party will
refer to this Agreement or use the other party's name in any form of publicity
or advertising directly or indirectly, without the prior written consent of the
party whose name is proposed for use.

         Except as to a sale of the business to which this Agreement relates or
transfer of the management of the Ernest Orlando Lawrence Berkley Laboratory,
the rights and obligations of each party under this Agreement may not be
assigned or transferred to any person, firm or corporation, without the express
prior written consent of the other party, which consent will not be unreasonably
withheld.

         Neither party makes any representations regarding the accuracy,
completeness, or freedom from defects of the information disclosed, or with
respect to infringement of the rights of others.


                                     3 of 4
<Page>

         The Receiving Party acknowledges and agrees that due to the unique
nature of the Disclosing Party's Proprietary Information, there may be no
adequate remedy at law for any breach of its obligations hereunder, that any
such breach may allow the Receiving Party or third parties to unfairly compete
with the Disclosing Party resulting in irreparable harm to the Disclosing Party,
and therefore, that upon any such breach or any threat thereof, the Disclosing
Party may be entitled to appropriate equitable relief in addition to whatever
remedies it might have at law. The Receiving Party will notify the Disclosing
Party in writing immediately upon the occurrence of any such unauthorized
release or other breach of which it is aware. In the event that any of the
provisions of this Agreement shall be held by a court or other tribunal of
competent jurisdiction to be illegal, invalid or unenforceable, such provisions
shall be limited or eliminated to the minimum extent necessary so that this
Agreement shall otherwise remain in full force and effect.

ENTIRE AGREEMENT:

         This Agreement represents the entire agreement of the parties
pertaining to the subject matter of the Agreement, and supersedes any and all
prior oral discussions and/or written correspondence or agreements between the
parties with respect thereto.

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in duplicate original copies by their respective duly authorized
representatives.

DIGIRAD                                  The Regents of the University of
                                         California Acting as Manager of the
                                         Lawrence Berkeley Laboratory


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

Name:                                    Name:
      ----------------------------             ---------------------------

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

Date:                                    Date:
      ----------------------------             ---------------------------


                                     4 of 4
<Page>


                                  AMENDMENT #1
                                       TO
                         LICENSE AGREEMENT FOR DETECTOR

This Amendment (the "Amendment"), effective as of the signing date of the last
party to sign below, is entered into by The Regents of the University of
California ("The Regents"), Department of Energy contract-operators of the
Ernest Orlando Lawrence Berkeley National Laboratory ("LBNL"), 1 Cyclotron Road,
Berkeley, CA 94720, (jointly, "Berkeley Lab"), and Digirad Corporation
("Digirad"), a Delaware corporation having its principal place of business at
9350 Trade Place, San Diego, CA 92126-6330.

         THE PARTIES ENTERED INTO A LICENSE AGREEMENT FOR DETECTOR, REFERENCE
         NUMBER L-90-1261 (THE "AGREEMENT"), EFFECTIVE DATE OF MAY 19, 1999. THE
         PARTIES NOW DESIRE TO AMEND THE AGREEMENT BY EXPANDING THE LICENSE TO
         INCLUDE A NON-EXCLUSIVE FIELD OF USE (AS DEFINED BELOW) PURSUANT TO THE
         TERMS AND CONDITIONS HEREIN. CAPITALIZED TERMS HEREIN SHALL HAVE THE
         MEANING AS SET FORTH IN THE AGREEMENT EXCEPT AS OTHERWISE DEFINED IN
         THIS AMENDMENT.


The parties agree as follows:

1.       Section 2.2 of the Agreement is hereby deleted in its entirety and
         replaced with the following:

         2.2      "Field of Use" and "Non-Exclusive Field of Use":

                  2.2.1    "Field of Use" means the development, production and
                           use of ***
                                                              ***
                                                              ***
                           The Field of Use specifically excludes the use of
                           ***, the Non-Exclusive Field of Use and all other
                           kinds of ***.

                  2.2.2    "Non-Exclusive Field of Use" means the development,
                           production and use of ***. Non-Exclusive Field
                           of Use specifically excludes the Field of Use, the
                           use of ***, as well as all kinds of *** other
                           than ***.

2.       Section 2.4 of the Agreement is hereby deleted in its entirety and
         replaced with the following:

         2.4      "Licensed Patents" means patent rights to any subject matter
                  claimed in or covered by any of the following:

                  2.4.1    US Patent Number ***
                                                              ***
                                                              ***

                  2.4.2    Any resulting patent issued in Germany or France
                           arising from European Patent Convention Application
                           ***

*** Portions of this page have been omitted pursuant to a request for
    Confidential Treatment and filed separately with the Commission.


                                                                            pg 1
<Page>

                                                              ***
                                                              ***

                  2.4.3    Japan Patent Application  ***
                                                              ***
                                                              ***

                  2.4.4    with respect to Sections 2.4.1 to 2.4.3, any
                           division, reexamination, continuation,
                           continuation-in-part (excluding new matter contained
                           and claimed in that continuation-in-part), or of
                           which such application is a successor; any patents
                           issuing on any of the foregoing, and all renewals,
                           reissues and extensions thereof, or other equivalents
                           of a renewal, reissues, and extensions thereof.

3.       Section 3.1 of the Agreement is hereby deleted in its entirety and
         replaced with the following:

         3.1      Subject to the limitations set forth in this Agreement,
                  Berkeley Lab grants to Digirad:

                  3.1.1    a nontransferable (subject to Section 18.1), limited
                           (by the terms of Sections 3.2 and 3.7) worldwide
                           exclusive, royalty-bearing license, under Licensed
                           Patents, only in the Field of Use, to develop, make,
                           have made, use, practice, sell, have sold, and lease
                           the Licensed Products.

                  3.1.2    a nontransferable (subject to Section 18.1),
                           nonexclusive worldwide, royalty-bearing license,
                           under Licensed Patents, only within the Non-Exclusive
                           Field of Use, to develop, make, have made, use,
                           practice, sell, and lease the Licensed Products.

4.       Section 4.1 of the Agreement is hereby deleted in its entirety and
         replaced with the following:

         4.1      As consideration for the licenses granted hereunder:

                  4.1.1    within the Field of Use, Digirad shall pay Berkeley
                           Lab a license issue fee of ***
                           dollars ($***) of which *** dollars
                           ($***) has been previously paid under the Option
                           Agreement, and the remaining *** dollars
                           ($***) has been paid to Berkeley Lab under this
                           Agreement.

                  4.1.2    within the Non-Exclusive Field of Use, Digirad shall
                           pay Berkeley Lab a license issue fee of ***
                           dollars ($***) of which ***
                           dollars ($***) shall be payable within fifteen
                           (15) days of the effective date of this Amendment,
                           and the remaining *** dollars ($***)
                           shall be paid within one year of the effective date
                           of this Amendment.

*** Portions of this page have been omitted pursuant to a request for
    Confidential Treatment and filed separately with the Commission.


                                                                            pg 2
<Page>

5.       Section 5.1 of the Agreement is hereby deleted in its entirety and
         replaced with the following:

         5.1      Digirad shall pay to Berkeley Lab an earned royalty of:

                  5.1.1    *** of the Selling Price of each Licensed Product
                           Digirad sells within the Field of Use;

                  5.1.2    *** of the Selling Price of each Licensed Product
                           Digirad sells within the Non-Exclusive Field of Use;

6.       Section 5.4 of the Agreement is hereby deleted in its entirety and
         replaced with the following:

         5.4      Digirad shall pay to Berkeley Lab by August 31 of each year
                  the difference between the earned royalties for that
                  calendar year Digirad has already paid to Berkeley Lab
                  for the Field of Use and Non-Exclusive Field of Use and
                  the minimum annual royalty set forth in the following
                  schedules for the Field of Use and Non-Exclusive Field
                  of Use. Berkeley Lab shall credit that minimum annual
                  royalty paid against the earned royalty due and owing
                  for the calendar year in which Digirad made the minimum
                  payment; provided that the earned royalties and minimum
                  annual royalties for the Field of Use shall be treated
                  separately from and independent of the earned royalties
                  and minimum annual royalties for the Non-Exclusive Field
                  of Use.



      ------------------------------------ ----------------------------------- -------------------------------
                 CALENDAR YEAR             MINIMUM ANNUAL ROVALTY FOR FIELD     MINIMUM ANNUAL ROYALTY FOR
                                                         OF USE                  NON-EXCLUSIVE FIELD OF USE
      ------------------------------------ ----------------------------------- -------------------------------
                                                                          
                     1999                                 *** (paid)                              N/A
      ------------------------------------ ----------------------------------- -------------------------------
                     2000                                 *** (paid)                              N/A
      ------------------------------------ ----------------------------------- -------------------------------
                     2001                                 ***                               ***
      ------------------------------------ ----------------------------------- -------------------------------
                     2002                                 ***                               ***
      ------------------------------------ ----------------------------------- -------------------------------
                     2003                                 ***                               ***
      ------------------------------------ ----------------------------------- -------------------------------
                     2004                                 ***                               ***
      ------------------------------------ ----------------------------------- -------------------------------
      2005 and each year thereafter                       ***                               ***
      ------------------------------------ ----------------------------------- -------------------------------


7.       Sections 6.4 and 6.5 of the Agreement are hereby deleted in their
         entirety and replaced with the following:

         6.4      If Digirad is unable to perform any of the following, then
                  Berkeley Lab may either terminate this Agreement or reduce the
                  limited exclusive license within the Field of Use to a
                  non-exclusive license within the Field of Use:

                  6.4.1    With regard to the Field of Use:

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    Confidential Treatment and filed separately with the Commission.


                                                                            pg 3
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                           6.4.1.1  complete market preparation and product
                                    introduction of the Licensed Products to the
                                    marketplace by *** (done); or

                           6.4.1.2  at any time during the exclusive period of
                                    this Agreement, reasonably fill the market
                                    demand for Licensed Products following
                                    commencement of marketing.

                  6.4.2    With regard to the Non-Exclusive Field of Use:

                           6.4.2.1  complete design of prototype photodiode(s)
                                    by ***;

                           6.4.2.2  fabricate prototype photodiode(s) by ***;

                           6.4.2.3  complete design of production photodiode by
                                    ***;

                           6.4.2.4  fabricate production photodiode by ***;

                           6.4.2.5  complete assembly of production module of
                                    Licensed Product by ***; or

                           6.4.2.6  complete market preparation and product
                                    introduction of the Licensed Products to the
                                    marketplace by ***;

                  It is the understanding of the parties hereto that any
                  termination of the Agreement or reduction of this license to a
                  non-exclusive license as a result of Digirad's failure to meet
                  the specifications of Section 6.4 shall be subject to the
                  sixty (60) day cure period set forth in Section 10.1 below.

         6.5      If Berkeley Lab grants a non-exclusive license to any other
                  party within the Field of Use upon royalty rates more
                  favorable than those of this Agreement after reducing the this
                  license within the Field of Use to a non-exclusive license
                  within the Field of Use, then Digirad is entitled to the
                  benefit of the more favorable rates. Digirad must agree in
                  writing to accept all terms of that third party license in
                  whole and not in part in order to enjoy the benefit of the
                  more favorable rates which shall commence upon delivery to
                  Berkeley Lab of that written agreement.

8.       The reporting obligations of Section 7 shall apply to both the Field
         of Use and Non-Exclusive Field of Use, separately and independently.
         Beginning December 1, 2001 and semi-annually thereafter, Digirad
         shall submit to Berkeley Lab a progress reports covering Digirad's
         activities related to the development and testing of all Licensed
         Products within the Non-Exclusive Field of Use and obtaining of the
         government approvals necessary for marketing as required pursuant to
         Section 7.1 ET. SEQ.

9.       Section 11.1 of the Agreement is hereby deleted in its entirety and
         replaced with the following:

         11.1     Digirad at any time may terminate this Agreement in whole or
                  as to any portion of Licensed Patents by giving written notice
                  to Berkeley Lab. Digirad's termination

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                                                                            pg 4
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                  of this Agreement will be effective ninety (90) days after
                  its notice. If that termination pertains to the Field of Use
                  and is without cause within three (3) years of the Effective
                  Date, Digirad shall pay Berkeley Lab as liquidated damages
                  *** dollars ($***) with the notice of termination before that
                  notice is effective.

10.      Section 15.2 of the Agreement is hereby deleted in its entirety.

11.      Section 15.5 of the Agreement is hereby deleted in its entirety and
         replaced with the following:

         15.5     Berkeley Lab shall bear the expense of preparing, filing,
                  prosecuting and securing all foreign patent applications that
                  Berkeley Lab files at Digirad's request (pursuant to Section
                  15.3 above). Digirad shall bear the expense of any
                  interference or oppositions and maintaining all resulting
                  patents. Berkeley Lab will hold these patents in its name and
                  obtain them using counsel of its choice that is reasonably
                  acceptable to Digirad.

12.      Section 15.6 of the Agreement is hereby deleted in its entirety and
         replaced with the following:

         15.6     Berkeley Lab shall promptly provide Digirad with copies of all
                  relevant documentation so that Digirad is informed of the
                  continuing prosecution of Licensed Patents. Additionally, upon
                  Digirad's request but no more than quarterly, Berkeley Lab
                  shall provide Digirad with a report summarizing the
                  status of the Licensed Patents. Digirad shall keep this
                  documentation confidential. Berkeley Lab shall use all
                  reasonable efforts to amend any patent application to
                  include claims reasonably requested by Digirad to
                  protect the products contemplated to be sold under this
                  Agreement.

13.      Digirad acknowledges and agrees that Section 16 applies, other than the
         first sentence of Section 16.1, only to jurisdictions in which Digirad
         has exclusive rights under the Agreement. Thus, except for that first
         sentence of Section 16.1, the entirety of Section 16 will not apply to
         the Licensed Products insofar as they are within the Non-Exclusive
         Field of Use.

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                                                                            pg 5
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14.      Except as specifically amended herein, the Agreement is hereby ratified
         and confirmed.

Berkeley Lab and Digirad execute this Agreement in duplicate originals through
their authorized respective officers in one or more counterparts that, taken
together, are but one instrument.


THE REGENTS OF THE UNIVERSITY                 DIGIRAD CORPORATION
OF CALIFORNIA, THROUGH THE
ERNEST ORLANDO LAWRENCE
BERKELEY NATIONAL LABORATORY

By   /S/ PIERMARIA ODDONE                     By    /S/ SCOTT HUENNEKENS
  -----------------------------------            ---------------------------
          (Signature)                                    (Signature)

By    PIERMARIA ODDONE                        By    SCOTT HUENNEKENS
  -----------------------------------             --------------------
Title    DEPUTY LABORATORY DIRECTOR           Title    PRESIDENT AND CEO
     --------------------------------                ---------------------
Date    5-24-01                               Date    5-11-01
    ---------------------------------               -----------


Approved as to form


/S/ GLENN R. WOODS
-------------------------------------
GLENN R. WOODS
LAWRENCE BERKELEY NATIONAL LABORATORY


                                                                            pg 6


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