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                                                                   EXHIBIT 10.16


                                   JALATE,LTD.

                             STOCK PURCHASE WARRANT

              THE WARRANTS EVIDENCED HEREBY AND THE SHARES OF STOCK
          ISSUABLE UPON EXERCISE THEREOF HAVE NOT BEEN REGISTERED UNDER
             THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE
            OFFERED OR SOLD WITHOUT REGISTRATION UNLESS AN EXEMPTION
          FROM REGISTRATION IS AVAILABLE UNDER SUCH ACT OR THE RULES OR
                       REGULATIONS PROMULGATED THEREUNDER

               WARRANT TO PURCHASE 250,000 SHARES OF COMMON STOCK
                               AS DESCRIBED HEREIN

         Issue Date: January 27, 1998.        Series A Warrant No.  4
Expiration Date: January 27, 2003.
Sale Price: $.10 per Number of Shares.

      This certifies that, for value received, William M. DeArman, his permitted
successors and assigns ("HOLDER"), is entitled to purchase from Jalate, Ltd., a
California corporation (the "COMPANY"), up to and including 250,000 fully paid
and nonassessable shares (the "NUMBER OF SHARES") of the Common Stock, no par
value, of the Company (the "COMMON STOCK") on the terms set forth herein at an
exercise price of $1.625 per share (the "PURCHASE PRICE"). The Number of Shares
and the Purchase Price may be adjusted from time to time as described in this
Warrant.

1. EXERCISE.

        1.1 TIME FOR EXERCISE. This Warrant may be exercised in whole or in part
at any time, and from time to time, during the period commencing on the date of
this Warrant and expiring on January 27, 2003 (the "EXERCISE PERIOD").

        1.2 MANNER OF EXERCISE. This Warrant shall be exercised by delivering it
to the Company with the exercise form duly completed and signed, specifying (i)
the number of shares as to which the Warrant is being exercised at that time
(the "EXERCISE NUMBER"), and (ii) whether the exercise is being made by
"purchase" or "exchange".

               1.2.1 PURCHASE. If the Holder elects the purchase option, the
Holder shall simultaneously therewith deliver to the Company cash or a certified
check in an amount equal to the Exercise Number multiplied by the Purchase
Price, and the Holder shall be entitled to receive the full Exercise Number of
shares of Common Stock.

               1.2.2 EXCHANGE. If the Holder elects the exchange option, the
Holder shall be entitled (without cash payment) to receive that number of shares
of Common Stock having an aggregate Market Value on the date of exercise equal
to the difference



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between the Market Value of the Exercise Number of shares and the aggregate
Purchase Price thereof. "MARKET VALUE" for any security on any given date means
(i) the average closing price for the prior ten trading days for such security
on the principal stock exchange on which such security is traded or (ii) if not
so traded, the closing (or, if no closing price is available, the average of the
bid and asked prices) for such period on The Nasdaq Stock Market if such
security is quoted thereon or (iii) if not listed on any exchange or quoted on
The Nasdaq Stock Market, such value, determined without regard to the minority
shareholder position of the Holder, as may be determined in good faith by an
independent appraiser selected by the Company and the Holder, which
determination shall be conclusively binding on the parties. The costs of the
independent appraiser shall be divided equally between the Company and the
Holders.

      1.3 EFFECT OF EXERCISE. Promptly (but in any case within five business
days) after any exercise, the Company shall deliver to the Holder (i) duly
executed certificates in the name or names specified in the exercise notice
representing the aggregate number of shares issuable upon such exercise, and
(ii) if this Warrant is exercised only in part, a new Warrant of like tenor
representing the balance of the Number of Shares. Such certificates shall be
deemed to have been issued, and the person receiving them shall be deemed to be
a holder of record of such shares, as of the close of business on the date the
actions required in Section 1.2 shall have been completed or, if on that date
the stock transfer books of the Company are closed, as of the next business day
on which the stock transfer books of the Company are open.

2.  TRANSFER OF WARRANTS AND STOCK.

      2.1 TRANSFER RESTRICTIONS. Neither this Warrant nor the securities
issuable upon its exercise may be sold, transferred or pledged unless the
Company shall have been supplied with reasonably satisfactory evidence that such
transfer is not in violation of the Securities Act of 1933, as amended (the
"ACT"), and any applicable state securities laws. The Company may place a legend
to that effect on this Warrant, any replacement Warrant and each certificate
representing shares issuable upon exercise of this Warrant.

      2.2 MANNER OF TRANSFER. Upon delivery of this Warrant to the Company with
the assignment form duly completed and signed, the Company will promptly (but in
any case within five business days) execute and deliver to each transferee and,
if applicable, the Holder, Warrants of like tenor evidencing the rights (i) of
the transferee(s) to purchase the Number of Shares specified for each in the
assignment forms, and (ii) of the Holder to purchase any untransferred portion,
which in the aggregate shall equal the Number of Shares of the original Warrant.
If this Warrant is properly assigned in compliance with this Section 2, it may
be exercised by an assignee without having a new Warrant issued.

      2.3 LOSS, DESTRUCTION OR MUTILATION OF WARRANT CERTIFICATES. Upon receipt
of (i) evidence reasonably satisfactory to the Company of the loss, theft,
destruction or mutilation of any Warrant and (ii) except in the case of
mutilation, an indemnity or security reasonably satisfactory to the Company, the
Company will promptly (but in any



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case within five business days) execute and deliver a replacement Warrant of
like tenor representing the right to purchase the same Number of Shares.

3. COST OF ISSUANCES. The Company shall pay all expenses, transfer taxes and
other charges payable in connection with the preparation, issuance and delivery
of stock certificates or replacement Warrants, except for any transfer tax or
other charge imposed as a result of (a) any issuance of certificates in any name
other than the name of the Holder, or (b) any transfer of the Warrant. The
Company shall not be required to issue or deliver any stock certificate or
Warrant until it receives reasonably satisfactory evidence that any such tax or
other charge has been paid by the Holder.

4. ANTI-DILUTION PROVISIONS. If any of the following events occur at any time
hereafter during the life of the Warrant, then the Warrant immediately prior to
such event shall be changed as described in order to prevent dilution:

             4.1 If at any time (i) the outstanding shares of Common Stock are
subdivided into a greater number of shares, then the Purchase Price will be
reduced proportionately and the Number of Shares will be increased
proportionately; conversely, (ii) if the outstanding shares of Common Stock are
consolidated into a smaller number of shares, then the Purchase Price will be
increased proportionately and the Number of Shares will be reduced
proportionately.

             4.2 Upon (i) any reorganization or reclassification of the Common
Stock, (ii) the dissolution or liquidation of the Company, (iii) a
reorganization, merger or consolidation of the Company with one or more
corporations as a result of which the Company is not the surviving corporation
or entity or becomes a subsidiary of another corporation or entity, or (iv) the
sale of substantially all the property or more than fifty percent (50%) of the
then outstanding stock of the Company to another corporation or entity (any such
occurrence shall be an "Event"), in which holders of Common Stock are entitled
to receive securities and/or assets as a result of their Common Stock ownership,
then upon exercise of this Warrant the Holder will have the right to receive the
shares of stock, securities or assets which it would have received if the
Warrant had been fully exercised as of the record date for such Event. The
Company will not effect any Event unless prior to or simultaneously with its
consummation the successor corporation or entity resulting from the
consolidation or merger (if other than the Company) or the Company's new
ultimate parent corporation or entity (if the Company becomes a subsidiary), or
the corporation purchasing the Company's assets or stock, assumes the
performance of the Company's obligations under this Warrant (as appropriately
adjusted to reflect such consolidation, merger or sale such that the Holder's
rights under this Warrant remain, as nearly as practicable, unchanged) by a
binding written instrument.

             4.3 If at any time the Company declares a dividend on the Common
Stock payable in shares of Common Stock or securities convertible into shares of
Common Stock, the Number of Shares shall be increased, as of the record date for
determining which holders of Common Stock shall be entitled to receive such
dividend,



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in proportion to the increase in the number of outstanding shares of Common
Stock as a result of such dividend. In the event any such securities convertible
into shares of Common Stock are not so converted by the time any such conversion
right expires, the Number of Shares shall be proportionately decreased, as of
such expiration date.

        4.4 Upon each computation of an adjustment under this Section 4, the
Purchase Price shall be computed to the nearest tenth of a cent and the Number
of Shares shall be calculated to the nearest whole share. However, the
fractional amount shall be used in calculating any future adjustments. No
fractional shares of stock shall be issued in connection with the exercise of
this Warrant, but the Company shall, in the case of the final exercise under
this Warrant, make a cash payment for any fractional shares based on the Market
Value of a share of Common Stock on the date of exercise (as defined in Section
1.2.2).

        4.5 Officer's Certificate. Whenever the Number of Shares or the Purchase
Price shall be adjusted as required by the provisions of this Section 4, the
Company forthwith shall file in the custody of its secretary or an assistant
secretary, at its principal office, a certificate of the chief financial officer
of the Company showing the adjusted Number of Shares and the adjusted Purchase
Price and setting forth in reasonable detail the circumstances requiring the
adjustment. Each such officer's certificate shall be made available at all
reasonable times during reasonable hours for inspection by the Holder.

        Notwithstanding any changes in the Purchase Price or the Number of
Shares, this Warrant may continue to state the initial Purchase Price and the
initial Number of Shares. Alternatively, the Company may elect to issue a new
Warrant or Warrants of like tenor for the additional shares of Common Stock or,
upon surrender of the existing Warrant, to issue a replacement Warrant
evidencing all the Warrant Shares to which the Holder is entitled after such
adjustments.

5.  COVENANTS.  The Company agrees that:

        5.1 RESERVATION OF STOCK. During the period in which this Warrant may be
exercised, the Company will reserve sufficient authorized but unissued
securities (and, if applicable, property) to enable it to satisfy its
obligations on exercise of this Warrant. If at any time the Company's authorized
securities shall not be sufficient to allow the exercise of this Warrant, the
Company shall take such corporate action as may be necessary to increase its
authorized but unissued securities to be sufficient for such purpose.

        5.2 NO LIENS, ETC. All securities that may be issued upon exercise of
this Warrant will, upon issuance, be validly issued, fully paid, nonassessable
and free from all taxes, liens and charges with respect to the issue thereof,
and shall be listed on any exchanges on which that class of securities is
listed.

        5.3 NO DIMINUTION OF VALUE. The Company will not take any action to
terminate this Warrant or to diminish it in value.



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        5.4 FURNISH INFORMATION. The Company will promptly deliver to the Holder
copies of all financial statements, reports and proxy statements which the
Company shall have sent to its stockholders generally.

        5.5 STOCK AND WARRANT TRANSFER BOOKS. Except upon dissolution,
liquidation or winding up or for ordinary holidays and weekends, the Company
will not at any time close its stock or warrant transfer books so as to result
in preventing or delaying the exercise or transfer of this Warrant.

6.  STATUS OF HOLDER.

        6.1 NOT SHAREHOLDER. Unless the Holder exercises this Warrant in
writing, the Holder shall not be entitled to any rights (i) as a stockholder of
the Company with respect to the shares as to which the Warrant is exercisable
including, without limitation, the right to vote or receive dividends or other
distributions, or (ii) to receive any notice of any proceedings of the Company
except as otherwise provided in this Warrant.

      6.2 LIMITATION OF LIABILITY. Unless the Holder exercises this Warrant in
writing, the Holder's rights and privileges hereunder shall not give rise to any
liability for the Purchase Price or as a stockholder of the Company, whether to
the Company or its creditors.

7.  REGISTRATION RIGHTS.

      7.1 DEMAND REGISTRATION. This Warrant is one in a series of warrants
having the same terms and identified as "Series A" (the "SERIES A WARRANTS").
Upon the request of the holders of a majority of the shares issuable upon
exercise of the Series A Warrants made anytime during the Exercise Period, the
Company will use all reasonable efforts on one occasion to register for resale
in accordance with the Act, all shares of Common Stock issuable upon exercise of
the Warrant which do not qualify for an exemption from such registration under
Rule 144 under the Act or a comparable or successor exemption from registration
("REGISTRABLE SHARES"); provided that such registration must cover at least
one-half of the Number of Shares covered by the original Series A Warrants. The
Holder agrees to cooperate with the Company in all reasonable ways to effect
such registration. The Company will use all reasonable efforts to keep such
registration effective for one hundred eighty days or, if shorter, until all
Registrable Shares included in the registration statement have been disposed of.
The effectiveness period of the registration statement shall be subject to
customary and reasonable "black-out" periods in the event of any significant
corporate transactions (including material financings); provided, however, that
the one hundred eighty day effectiveness period shall be extended on a
day-for-day basis in connection with any such "black-out."

      The Purchase Price shall be decreased by $.10 per share (subject to
adjustment pursuant to Section 4.1 hereof) if the Company does not file the
registration statement with the Securities and Exchange Commission (the
"COMMISSION") within 90 days following the making of the demand and by an
additional $.10 per share (subject to



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adjustment pursuant to Section 4.1 hereof) for each subsequent 90-day period in
which the registration statement is not filed.

        7.2 "PIGGYBACK" REGISTRATION. If at any time the Company proposes to
file a registration statement under the Act with respect to an offering of its
Common Stock (other than a registration statement on Form S-4 or Form S-8 or any
successor or similar forms), whether or not for sale for its own account, then
the Company each such time shall give the Holder ten (10) business days written
notice before the filing thereof, which such notice shall offer the Holder the
opportunity to register such Holder's Registrable Shares. The Company shall
include in such registration statement all of the Holder's Registrable Shares
with respect to which the Company has received written request for inclusion
within ten (10) business days after notice has been duly given by the Company.
Notwithstanding the foregoing, the Company shall not be required to include the
Holder's Registrable Shares if the managing underwriter or underwriters of such
offering determine and advise the Company that inclusion of the Registrable
Shares and any other shares having "piggyback" registration rights (the "OTHER
SHARES") would likely adversely affect such offering. If the managing
underwriter or underwriters determine that a portion of the Registrable Shares
and Other Shares may be included in the offering, the Registrable Shares and the
Other Shares shall be included in the registration on a pro rata basis (in
relation to the number of such Registrable Shares and Other Shares so requested
to be included in the offering).

        7.3 REGISTRATION EXPENSES. Except as otherwise required by state
securities laws or the rules and regulations promulgated thereunder, all
expenses, disbursements and fees incurred by the Company in connection with
carrying out its obligations under this Section 7 shall be borne by the Company;
provided, however, that the Holder shall pay (i) all costs and expenses of
counsel, accounting or financing professionals retained by such Holder, (ii) all
underwriting discounts, commissions, fees and expenses and all transfer taxes
with respect to the shares sold by such Holder, and (iii) all other expenses
incurred by such Holder and incidental to the sale and delivery of the shares to
be sold by such Holder.

        7.4 CONDITIONS TO HOLDER'S RIGHTS. It shall be a condition of the
Holder's rights under this Section 7 that:

             7.4.1 Cooperation. Such Holder shall cooperate with the Company by
supplying information and executing documents relating to such Holder or the
securities of the Company owned by such Holder in connection with such
registration which are customary for offerings of this type or is required by
applicable laws or regulations (including agreeing to sell such Holder's
Registrable Securities on the basis provided in any underwriting arrangements
containing customary terms reasonably satisfactory to such Holder); and

             7.4.2 Undertakings. Such Holder shall enter into any undertakings
and take such other action relating to the conduct of the proposed offering
which the Company or the underwriters may reasonably request as being necessary
to insure



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compliance with federal and state securities laws and the rules or other
requirements of the National Association of Securities Dealers, Inc., The Nasdaq
Stock Market or which the Company or the underwriters may reasonably request to
otherwise effectuate the offering.

      7.5 Registration Procedures. If and whenever the Company is required to
use its reasonable efforts to effect the registration of any Registrable Shares
under the Act as provided in this Section 7, the Company will, as expeditiously
as practicable:

             (i) notify the Holder of the Commission's requests for amending or
        supplementing of the registration statement and the prospectus, and
        prepare and file with the Commission such amendments and supplements to
        such registration statement and the prospectus used in connection
        therewith as may be necessary to keep such registration statement
        effective and to comply with the provisions of the Act with respect to
        the disposition of all Registrable Shares covered by such registration
        statement;

             (ii) furnish to the Holder such number of conformed copies of such
        registration statement and of each such amendment and supplement thereto
        (in each case including all exhibits), such number of copies of the
        prospectus contained in such registration statement (including each
        preliminary prospectus and any summary prospectus) and any other
        prospectus filed under Rule 424 under the Act, in conformity with the
        requirements of the Act, and such other documents, as the Holder may
        reasonably request;

             (iii) use its reasonable efforts (x) to register or qualify all
        Registrable Shares covered by such registration statement under such
        other securities or blue sky laws of such States of the United States of
        America where an exemption is not available and as the Holder shall
        reasonably request, (y) to keep such registration or qualification in
        effect for so long as such registration statement remains in effect, and
        (z) to take any other action which may be reasonably necessary or
        advisable to enable the Holder to consummate the disposition in such
        jurisdictions of the Registrable Shares to be sold by the Holder, except
        that the Company shall not for any such purpose be required to qualify
        generally to do business as a foreign corporation in any jurisdiction
        wherein it would not but for the requirements of this subdivision (iii)
        be obligated to be so qualified or to consent to general service of
        process or become subject to general taxation in any such jurisdiction;

             (iv) use its reasonable efforts to cause all Registrable Shares
        covered by such registration statement to be registered with or approved
        by such other federal or state governmental agencies or authorities as
        may be necessary in the opinion of counsel to the Company and counsel to
        the Holder to consummate the disposition of such Registrable Shares;

               (v)   furnish to the Holder a signed counterpart of



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                        (x) an opinion of counsel for the Company, and

                        (y) a "comfort" letter signed by the independent public
                accountants who have certified the Company's financial
                statements included or incorporated by reference in such
                registration statement,

        covering substantially the same matters with respect to such
        registration statement (and the prospectus included therein) and, in the
        case of the accountant's comfort letter, with respect to events
        subsequent to the date of such financial statements, as are customarily
        covered in opinions of issuer's counsel and in accountants' comfort
        letters delivered to the underwriters in underwritten public offerings
        of securities (and dated the dates such opinions and comfort letters are
        customarily dated) and, in the case of the accountant's comfort letter,
        such other financial matters, and in the case of the legal opinion, such
        other legal matters, as the Holder or the underwriters may reasonably
        request;

             (vi) notify the Holder at any time when a prospectus relating
        thereto is required to be delivered under the Act, upon discovery that,
        or upon the happening of any event as a result of which, the prospectus
        included in such registration statement, as then in effect, includes an
        untrue statement of a material fact or omits to state any material fact
        required to be stated therein or necessary to make the statements
        therein not misleading, in the light of the circumstances under which
        they were made, and at the request of the Holder promptly prepare and
        furnish to him a reasonable number of copies of a supplement to or an
        amendment of such prospectus as may be necessary so that, as thereafter
        delivered to the purchasers of such securities, such prospectus shall
        not include an untrue statement of a material fact or omit to state a
        material fact required to be stated therein or necessary to make the
        statements therein not misleading in the light of the circumstances
        under which they were made; and

               (vii) otherwise use its reasonable efforts to comply with all
        applicable rules and regulations of the Commission.

      The Holder agrees by acquisition of such Registrable Shares that upon
receipt of any written notice from the Company of the happening of any event of
the kind described in subdivision (vi) of this Section 7.5 the Holder will
forthwith discontinue its disposition of Registrable Shares pursuant to the
registration statement relating to such Registrable Shares until the Holder's
receipt of the copies of the supplemented or amended prospectus contemplated by
subdivision (vi) of this Section 7.5 and, if so directed by the Company, will
deliver to the Company (at the Company's expense) all copies, other than
permanent file copies, then in the Holder's possession, of the prospectus
relating to such Registrable Shares current at the time of receipt of such
notice.

        Nothing contained in this Section 7.5 shall require or obligate the
Company to cause any registration statement pursuant to which the Holder has
exercised its



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"piggyback" registration rights pursuant to Section 7.2 hereof to become
effective or, if declared effective, to maintain the effectiveness of such
registration statement.

        7.6    Indemnification.

      (a) Indemnification by the Company. In the event of any registration of
any Registrable Shares under the Act, the Company will, and it hereby does,
indemnify and hold harmless, to the full extent permitted by law, the Holder,
its directors, officers, partners, heirs, personal representatives, agents and
affiliates and each other person, if any, who controls the Holder within the
meaning of the Act, against any and all losses, claims, damages or liabilities
(or actions or proceedings, whether commenced or threatened, in respect thereof)
which arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in any registration statement under
which such securities were registered under the Act, any preliminary prospectus,
final prospectus or summary prospectus contained therein, or any amendment or
supplement thereto, or any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein in light of the circumstances in which they were made not misleading,
and the Company will reimburse the Holder and each such director, officer,
partner, heir, personal representative, agent or affiliate, and controlling
person for any legal or any other expenses reasonably incurred by them in
connection with investigating or defending any such loss, claim, liability,
action or proceeding; provided, however, that the Company shall not be liable in
any such case to the extent that any such loss, claim, damage, liability (or
action or proceeding in respect thereof) or expense arises out of or is based
upon an untrue statement or alleged untrue statement or omission or alleged
omission made in such registration statement, any such preliminary prospectus,
final prospectus, summary prospectus, amendment or supplement (i) in reliance
upon and in conformity with written information furnished to the Company through
an instrument duly executed by or on behalf of the Holder, specifically stating
that it is for use in the preparation thereof or (ii) which is corrected in an
amendment or supplement or final prospectus (or amendment or supplement thereto)
provided to the indemnified person and such amended, supplemented or final
prospectus (or amendment or supplement thereto) was not given by or on behalf of
such indemnified person to the person who purchased the Registrable Securities,
if such is required by law at or prior to the written confirmation of the sale
of the Registrable Securities to such person; and provided, further, that the
Company shall not be liable to any person to the extent that any such loss,
claim, damage, liability (or action or proceeding in respect thereof) or expense
arises out of or is based upon any violation by such person of the Act or the
Securities Exchange Act of 1934, as amended. Such indemnity shall remain in full
force regardless of any investigation made by or on behalf of the Holder or any
such director, officer, partner, heir, personal representative, agent or
affiliate or controlling person and shall survive the transfer of such
securities by the Holder.

      (b) Indemnification by the Holder. As a condition to including any
Registrable Shares in any registration statement, the Company shall have
received an undertaking reasonably satisfactory to it from each Holder, to
indemnify and hold



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harmless (in the same manner and to the same extent as set forth in subdivision
(a) of this Section 7.6) the Company, its directors, officers, agents and
affiliates and each other person, if any, who controls the Company within the
meaning of the Act, with respect to any statement or alleged statement in or
omission or alleged omission from such registration statement, any preliminary
prospectus, final prospectus or summary prospectus contained therein, or any
amendment or supplement thereto, if such statement or alleged statement or
omission or alleged omission (i) was made in reliance upon and in conformity
with written information furnished to the Company through an instrument duly
executed by the Holder specifically stating that it is for the use in the
preparation of such registration statement, preliminary prospectus, final
prospectus, summary prospectus, amendment or supplement or (ii) is corrected in
an amendment or supplement or final prospectus (or amendment or supplement
thereto) provided to the indemnifying person and such amended, supplemented or
final prospectus (or amendment or supplement thereto) was not given by or on
behalf of such indemnifying person to the person who purchased the Registrable
Securities, if such is required by law at or prior to the written confirmation
of the sale of the Registrable Securities to such person; provided, however,
that the liability of such indemnifying party under this Section 7.6(b) shall be
limited to the amount of proceeds received by the Holder in the offering giving
rise to such liability. Such indemnity shall remain in full force and effect,
regardless of any investigation made by or on behalf of the Company or any such
director, officer or controlling person and shall survive the transfer of such
securities by the Holder.

      (c) Notices of Claims, etc. Promptly after receipt by an indemnified party
hereunder of written notice of the commencement of any action or proceeding
involving a claim referred to in the preceding subdivisions of this Section 7.6,
such indemnified party will , if a claim in respect thereof is to be made
against an indemnifying party, give written notice to the latter of the
commencement of such action; provided, however, that the failure of any
indemnified party to give notice as provided herein shall not relieve the
indemnifying party of its obligations under the preceding subdivisions of this
Section 7.6, except to the extent that the indemnifying party is actually
prejudiced by such failure to give notice. In case any such claim or action is
brought against an indemnified party, the indemnifying party shall be entitled
to participate in and, unless representation of such indemnified party and any
such indemnifying party by the same counsel would be inappropriate under
applicable standards of professional conduct (whether or not such representation
by the same counsel has been proposed) due to actual or potential differing
interests between them, to assume the defense thereof, jointly with any other
indemnifying party similarly notified to the extent that it may wish, with
counsel reasonably satisfactory to such indemnified party, and after notice from
the indemnifying party to such indemnified party of its election so to assume
the defense thereof, the indemnifying party shall not be liable to such
indemnified party for any legal or other expenses subsequently incurred by the
latter in connection with the defense thereof other than reasonable costs of
investigation. No indemnifying party shall be liable for any settlement of any
action or proceeding effected without its written consent. No indemnifying party
shall, without the consent of the indemnified party, consent to entry of any
judgment or enter into any settlement which does not include as an unconditional
term thereof the giving by the claimant or plaintiff to such indemnified party
of a release



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from all liability in respect to such claim or litigation. An indemnifying party
who is not entitled to, or elects not to, assume the defense of a claim will not
be obligated to pay the fees and expenses of more than one counsel for all
parties indemnified by an indemnifying party with respect to such claim, unless
representation of such indemnified parties by the same counsel would be
inappropriate under applicable standards of professional conduct (whether or not
such representation by the same counsel has been proposed) due to actual or
potential differing interests between them with respect to such claim, in which
event the indemnifying party shall be obligated to pay the fees and expenses of
such additional counsel or counsels.

        (d) Contribution. If the indemnification provided for in this Section
7.6 shall for any reason be held by a court to be unavailable to an indemnified
party under subparagraph (a) or (b) hereof in respect of any loss, claim, damage
or liability, or any action in respect thereof, then, in lieu of the amount paid
or payable under subparagraph (a) or (b) hereof, the indemnified party and the
indemnifying party under subparagraph (a) or (b) hereof shall contribute to the
aggregate losses, claims, damages and liabilities (including legal or other
expenses reasonably incurred in connection with investigation of the same), (i)
in such proportion as is appropriate to reflect the relative fault of the
Company and the Holder with respect to the acts, statements or omissions which
resulted in such loss, claim, damage or liability, or action in respect thereof,
as well as any other relevant equitable considerations or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as shall be appropriate to reflect the relative benefits received by
the Company and the Holder from the offering of the securities covered by such
registration statement. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11 (f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. In addition,
no person shall be obligated to contribute hereunder any amounts in payment for
any settlement of any action or claim effected without such person's consent,
which consent shall not be unreasonably withheld.

        (e) Other Indemnification. Indemnification and contribution similar to
that specified in the preceding subdivisions of this Section 7.6 (with
appropriate modifications) shall be given by the Company and the Holder with
respect to any required registration or other qualification of securities under
any federal or state law or regulation of any governmental authority other than
the Act.

        (f) Indemnification Payments. The indemnification and contribution
required by this Section 7.6 shall be made by periodic payments of the amount
thereof during the course of the investigation or defense, as and when bills are
received or expense, loss, damage or liability is incurred.

8.      GENERAL PROVISIONS.

        8.1 COMPLETE AGREEMENT; MODIFICATIONS. This Warrant and any documents
referred to herein or executed contemporaneously herewith constitute the
parties' entire agreement with respect to the subject matter hereof and
supersede all agreements,



                                      -11-

<PAGE>   12

representations, warranties, statements, promises and understandings, whether
oral or written, with respect to the subject matter hereof. This Warrant may not
be amended, altered or modified except by a writing signed by the parties.

        8.2 ADDITIONAL DOCUMENTS. Each party hereto agrees to execute any and
all further documents and writings and to perform such other actions which may
be or become necessary or expedient to effectuate and carry out this Warrant.

        8.3 NOTICES. All notices under this Warrant shall be in writing and
shall be delivered by personal service or telecopy or certified mail, postage
prepaid, to such address as may be designated from time to time by the relevant
party, and which shall initially be:

                                   Jalate, Ltd.
                                   6557 Flotilla Street
                                   City of Commerce, California 90040
                                   Fax: (213) 728-3752
                                   Attn: Frederick A. Findley
                                         Vice President-Finance and
                                         Chief Financial Officer

                                   William M. DeArman
                                   5420 Huckleberry Lane
                                   Houston, Texas 77056
                                   Fax: (713) 552-1505

        Any notice sent by certified mail shall be deemed to have been given
five (5) business days after the date on which it is mailed. All other notices
shall be deemed given when received. No objection may be made to the manner of
delivery of any notice actually received in writing by an authorized agent of a
party.

        8.4 NO THIRD-PARTY BENEFITS; SUCCESSORS AND ASSIGNS. None of the
provisions of this Warrant shall be for the benefit of, or enforceable by, any
third-party beneficiary. Except as provided herein to the contrary, this Warrant
shall be binding up-on and inure to the benefit of the parties, their respective
successors and permitted assigns.

        8.5  DISPUTES.

             8.5.1 GOVERNING LAW; JURISDICTION. This Warrant concerns a
California business and all questions with respect to the Warrant and the rights
and liabilities of the parties will be governed by the laws of California in all
respects, including matters of construction, validity, enforcement and
performance, regardless of the choice of law provisions of California or any
other jurisdiction. Any and all disputes between the parties which may arise
pursuant to this Warrant and not resolved by them will be heard and determined
before an appropriate federal or state court located in Houston, Texas.



                                     - 12 -

<PAGE>   13

The parties hereto acknowledge that such courts have the jurisdiction to
interpret and enforce the provisions of this Warrant and the parties waive any
and all objections that they may have as to personal jurisdiction or venue in
any of the above courts.

             8.5.2 ATTORNEYS' FEES. Should any litigation be commenced
(including any proceedings in a bankruptcy court) between the parties hereto or
their representatives concerning any provisions of this Warrant or the rights
and duties of any person or entity hereunder, the party or parties prevailing in
such proceeding shall be entitled, in addition to such other relief as may be
granted, to the reasonable attorneys' fees and court costs incurred by reason of
such litigation.

      8.6 WAIVERS STRICTLY CONSTRUED. With regard to any power, remedy or right
provided herein or otherwise available to any party hereunder (i) no waiver or
extension of time shall be effective unless expressly contained in a writing
signed by the waiving party; and (ii) no alteration, modification or impairment
shall be implied by reason of any previous waiver, extension of time, delay or
omission in exercise, or other indulgence.

        8.7  RULES OF CONSTRUCTION.

             8.7.1 HEADINGS. The Article and Section headings in this Warrant
are inserted only as a matter of convenience, and in no way define, limit, or
extend or interpret the scope of this Warrant or of any particular Article or
Section.

             8.7.2 TENSE AND CASE. Throughout this Warrant, as the context may
require, references to any word used in one tense or case shall include all
other appropriate tenses or cases.

             8.7.3 SEVERABILITY. The validity, legality or enforceability of the
remainder of this Warrant will not be affected even if one or more of the
provisions of this Warrant are held to be invalid, illegal or unenforceable in
any respect.

             8.7.4 WARRANT NEGOTIATED. The parties hereto are sophisticated and
have been represented throughout this transaction by lawyers who have carefully
negotiated the provisions hereof. As a consequence, the parties do not believe
that the presumptions of any laws or rules relating to the interpretation of
contracts against the drafter of any particular clause should be applied in this
case and therefore waive their effects.



                                     - 13 -

<PAGE>   14



      IN WITNESS WHEREOF, the Company has caused this Warrant to be duly
executed effective as of January 27, 1998.


                                        JALATE, LTD., a California
                                        corporation


                                        By:  /s/ FREDERICK A. FINLEY
                                           ---------------------------------
                                             Frederick A. Finley
                                             Vice President and Chief
                                             Financial Officer



                                      -14-

<PAGE>   15

                                 ASSIGNMENT FORM

        FOR VALUE RECEIVED,______________________________________ hereby sells,
assigns and transfers to the transferee named below [the rights to purchase
______________ of the Number of Shares under] this Warrant, together with all
rights, title and interest therein. [The rights to purchase the remaining Number
of Shares shall remain the property of the undersigned.] This includes a
transfer of the registration rights in the Warrant; provided, however, that in
the case of a partial assignment of this Warrant, both the Holder and the
transferee shall have the registration rights set forth in Section 7 of the
Warrant.

Dated:____________________
                                        [NAME OF HOLDER]

                                        By______________________________________
                                             Signature


                                        Name:___________________________________
                                                   (Please Print)


                                        Address:________________________________
                                                ________________________________
                                                ________________________________

                                        Employer Identification Number,
                                        Social Security Number or other
                                        identifying number:_____________________



TRANSFEREE:

Name:______________________________
        (Please Print)

Address:___________________________
        ___________________________
        ___________________________

Employer Identification Number,
Social Security Number or other
identifying number:________________



                                      -15-

<PAGE>   16

                                  EXERCISE FORM

                                 To Be Executed
                            Upon Exercise of Warrant

      The undersigned hereby exercises the Warrant with regard to _____________
shares of Common Stock and herewith [makes payment of the purchase price in
full] [or requests that the Company exchange the Warrant as provided in Section
1.2.2 of the Warrant]. The undersigned requests that certificate(s) for such
shares [and the Warrant for the unexercised portion of this Warrant] be issued
[to the Holder] [in the name set forth below].

Dated:_____________________
                                        [NAME OF HOLDER]

                                        By______________________________________
                                             Signature

                                        Name:___________________________________
                                                  (Please Print)


                                        Address:________________________________
                                                ________________________________
                                                ________________________________

                                        Employer Identification Number,
                                        Social Security Number or other
                                        identifying number:_____________________


[TRANSFEREE:

Name:______________________________
        (Please Print)

Address:___________________________
        ___________________________
        ___________________________


Employer Identification Number,
Social Security Number or other
identifying number:________________]



                                      -16-