<PAGE>   1
                                                                   EXHIBIT 10.21
                                ----------------
                                REDACTED VERSION
                                ----------------

                            ASSET PURCHASE AGREEMENT



                                     BETWEEN



                           INTERNATIONAL ISOTOPES INC.



                                       AND



                                NEORX CORPORATION







                              DATED: MARCH 20, 2001



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                                    CONTENTS

<TABLE>
<S>     <C>                                                                          <C>
1.      Definitions................................................................  1
2.      Purchase and Sale of Assets................................................  5
        2.1       Purchase and Sale................................................  5
                  2.1.1      Equipment.............................................  5
                  2.1.2      Equipment and Other Personal Property Leases..........  6
                  2.1.3      Inventory.............................................  6
                  2.1.4      Intellectual Property, Books and Manuals..............  6
                  2.1.5      Permits...............................................  7
                  2.1.6      Contract Rights.......................................  7
                  2.1.7      Purchased Real Property...............................  7
                  2.1.8      Insurance Proceeds....................................  7
        2.2       Excluded Assets..................................................  7
                  2.2.1      Tax Refunds...........................................  7
                  2.2.2      Cash and Equivalents..................................  7
                  2.2.3      Accounts Receivable...................................  7
                  2.2.4      Excluded Real Property................................  7
                  2.2.5      Excluded Contracts....................................  8
                  2.2.6      Other Excluded Assets.................................  8
        2.3       Assumption of Liabilities........................................  8
        2.4       Excluded Liabilities.............................................  8
                  2.4.1      Excluded Real Property................................  8
                  2.4.2      Taxes.................................................  8
                  2.4.3      Litigation............................................  8
                  2.4.4      Claims................................................  9
                  2.4.5      Warranties............................................  9
                  2.4.6      Environmental Liability...............................  9
                  2.4.7      Severance Costs.......................................  9
                  2.4.8      Employee Expenses.....................................  9
                  2.4.9      Accrued Liabilities and Payables......................  9
                  2.4.10     Other.................................................  10
        2.5       Instruments of Sale and Transfer.................................  10
        2.6       Further Assurances...............................................  10
3.      Purchase Price.............................................................  10
        3.1       Purchase Price...................................................  10
        3.2       Allocation of Purchase Price.....................................  11
4.      Closing....................................................................  11
        4.1       Closing Date.....................................................  11
        4.2       Closing Payments.................................................  11
5.      Representations and Warranties of Seller...................................  12
        5.1       Organization, Good Standing, etc.................................  12
        5.2       Corporate Authority..............................................  12
        5.3       No Conflict......................................................  12
        5.4       Consents and Approvals...........................................  13
        5.5       Financial Statements.............................................  13
</TABLE>

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<TABLE>
<S>     <C>                                                                          <C>
        5.6       Absence of Certain Changes or Events.............................  13
        5.7       Taxes............................................................  13
        5.8       Purchased Real Property..........................................  14
        5.9       Equipment........................................................  15
        5.10      Environmental and Safety Matters.................................  15
        5.11      Contracts........................................................  17
        5.12      Claims and Legal Proceedings.....................................  17
        5.13      Labor Matters....................................................  18
        5.14      Patents, Trademarks and Intellectual Property....................  18
        5.15      Licenses, Permits, Authorizations, etc...........................  20
        5.16      Compliance With Law..............................................  20
        5.17      Permits and Qualifications.......................................  20
        5.18      Insurance........................................................  20
        5.19      Employee Plans...................................................  20
        5.20      Excluded Assets..................................................  21
        5.21      Brokerage........................................................  21
        5.22      Accredited Investor..............................................  21
        5.23      Ongoing Business.................................................  22
        5.24      Full Disclosure..................................................  22
6.      Representations and Warranties of Buyer....................................  22
        6.1       Organization, Good Standing, Power, etc..........................  22
        6.2       Transaction Documents............................................  22
        6.3       No Conflict......................................................  22
        6.4       Claims and Local Proceedings.....................................  23
        6.5       Brokerage........................................................  23
        6.6       Warrant..........................................................  23
        6.7       Consents and Approvals...........................................  23
7.      Certain Covenants..........................................................  23
        7.1       Access...........................................................  23
        7.2       Assignment of Contracts..........................................  24
        7.3       Conduct of Business Prior to Closing.............................  25
                  7.3.1 ...........................................................  25
                  7.3.2 ...........................................................  25
        7.4       Covenants to Satisfy Conditions..................................  26
8.      Conditions Precedent to Obligations of Buyer...............................  26
        8.1       No Injunction or Litigation; Compliance with Laws................  26
        8.2       Representations, Warranties and Covenants........................  27
        8.3       No Adverse Changes...............................................  27
        8.4       Consents and Approvals...........................................  27
        8.5       Taxes............................................................  28
        8.6       Delivery of Documents............................................  28
        8.7       Legal Opinion....................................................  29
        8.8       Satisfaction of Conditions.......................................  29
        8.9       Employment and Noncompetition Arrangements.......................  29
        8.10      Agreement with Texas State Bank; Assumption of Bank Debt.........  29
        8.11      Opinion as to Environmental Matters..............................  29
</TABLE>

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<TABLE>
<S>     <C>                                                                          <C>
        8.12      Imagyn Lease Agreement...........................................  29
        8.13      University of North Texas Lease Agreement........................  30
        8.14      License to Background Intellectual Property......................  30
9.      Conditions Precedent to Obligations of Seller..............................  30
        9.1       No Injunction or Litigation......................................  30
        9.2       Representations, Warranties and Covenants........................  31
        9.3       Delivery of Documents............................................  31
        9.4       Legal Opinion....................................................  31
        9.5       Agreement with Texas State Bank; Assumption of Bank Debt.........  31
        9.5       Obligations to Unsecured Creditors...............................  31
        9.6       Imagyn Closing...................................................  31
        9.7       LINAC and Bracco Agreement.......................................  31
        9.9       University of North Texas Lease Agreement........................  32
        9.10      Satisfaction of Conditions.......................................  32
10.     Certain Post-Closing Covenants.............................................  32
        10.1      Further Assurances...............................................  32
        10.2      Books and Records................................................  32
        10.3      Post-Closing Cooperation.........................................  33
11.     Taxes and Costs; Apportionment.............................................  33
        11.1      Transfer Taxes...................................................  33
        11.2      Transaction Costs................................................  33
        11.3      Apportionment....................................................  33
12.     Bulk Sales.................................................................  33
13.     Covenants Not to Compete...................................................  33
        13.1      Covenants........................................................  33
        13.2      Minor Investments................................................  34
        13.3      Remedies.........................................................  34
14.     Survival and Indemnification...............................................  34
        14.1      Survival.........................................................  34
        14.2      Indemnification by Seller........................................  35
        14.3      Indemnification by Buyer.........................................  36
        14.4      Threshold and Time Limitations...................................  36
        14.5      Procedure........................................................  37
        14.6      Proportional Liability for Losses................................  38
        14.7      Election of Remedies.............................................  38
        14.8      Specific Performance.............................................  38
        14.9      Exclusive Remedies...............................................  39
15.     Termination................................................................  39
        15.1      Termination......................................................  39
        15.2      Effect of Termination............................................  39
16.     Miscellaneous..............................................................  40
        16.1      Confidentiality Obligations of Seller Following the Closing......  40
        16.2      Public Announcements.............................................  40
        16.3      Severability.....................................................  40
        16.4      Modification and Waiver..........................................  40
        16.5      Notices..........................................................  41
</TABLE>

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<TABLE>
<S>     <C>                                                                          <C>
        16.6      Assignment.......................................................  41
        16.7      Captions.........................................................  42
        16.8      Entire Agreement.................................................  42
        16.9      No Third-Party Rights............................................  42
        16.10     Counterparts.....................................................  42
        16.11     Governing Law....................................................  42
</TABLE>



Exhibit 2.5(a)    Bill of Sale and Assignment
Exhibit 2.5(b)    Assignment and Assumption Agreement
Exhibit 3.1       Form of Warrant
Exhibit 8.7       Opinion of Seller's Counsel
Exhibit 9.4       Opinion of Buyer's Counsel


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<PAGE>   6

                            ASSET PURCHASE AGREEMENT

        This Asset Purchase Agreement (this "Agreement") is made as of the 20th
day of March, 2001, by and between International Isotopes Inc., a Texas
corporation ("Seller"), and NeoRx Corporation, a Washington corporation
("Buyer").

                                    RECITALS

        A. Seller desires and intends to sell certain of its assets and other
rights relating to its operations, products, services and activities at or on
the Jim Christal Property, at the price and on the terms and conditions herein
set forth.

        B. Buyer desires and intends to purchase certain of Seller's assets and
other rights relating to Seller's operations, products, services and activities
at or on the Jim Christal Property and to assume certain of the liabilities
relating to such assets, at the price and on the terms and conditions herein set
forth.

                                    AGREEMENT

        NOW, THEREFORE, in consideration of the covenants and agreements set
forth herein, the parties hereby agree as follows:

1.    DEFINITIONS

        As used in this Agreement, the following capitalized terms shall have
the meanings set forth below:

        1.1 "Affiliate": of any person (the "Subject") means any other person
which, directly or indirectly, controls or is controlled by or is under common
control with the Subject and, without limiting the generality of the foregoing,
includes, in any event, (a) any person which beneficially owns or holds 25% or
more of any class of voting securities of the Subject or 25% or more of the
legal or beneficial interest in the Subject and (b) any person of which the
Subject beneficially owns or holds 25% or more of any class of voting securities
or 25% or more of the legal or beneficial interest; provided, however, that the
Preferred Shareholders of Seller and persons and entities not controlled by
Seller shall not be deemed "Affiliates" of the Seller for purposes of Section 13
of this Agreement. "Control" (including, with correlative meanings, the terms
"controlled by" and "under common control with"), as used with respect to any
person, means the possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of such person, whether
through the ownership of voting securities, by contract or otherwise.

        1.2 "Agreement": This Agreement and all Schedules and Exhibits hereto.

        1.3 "Assets": As defined in Section 2.1.

        1.4 "Assignment and Assumption Agreement": As defined in Section 2.5.

        1.5 "Assumed Liabilities": As defined in Section 2.3.


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        1.6 "Balance Sheet Date": As defined in Section 5.5.

        1.7 "Bill of Sale". As defined in Section 2.6.

        1.8 "Business". All operations, products, services and activities of
Seller at or on the Jim Christal Property. "Business" shall include the
operation of the Assets and the Facilities. Notwithstanding the foregoing,
"Business" does not include Seller's brachytherapy seed business, the business
of International Isotopes of Idaho, Inc., the linear accelerator operations of
Seller or the related operations conducted at Seller's Shady Oaks property in
Denton, Texas, or any operations of Seller conducted at Seller's property in
Waxahachie, Texas.

        1.9 "Claim": Any claim, demand, cause of action, suit, proceeding,
arbitration, hearing or investigation.

        1.10 "Closing": The consummation of the purchase and sale of the Assets
under this Agreement.

        1.11 "Closing Date": The date upon which the Closing becomes effective.

        1.12 "Code": The Internal Revenue Code of 1986, as amended, and all
regulations promulgated thereunder, as in effect from time to time.

        1.13 "Contract": As defined in Section 2.1.6.

        1.14 "Creditor Amount": As defined in Section 3.1.

        1.15 "Disclosure Memorandum": That certain Disclosure Memorandum dated
as of the date hereof and delivered by Seller to Buyer on the date hereof in
connection with this Agreement.

        1.16 "Employee Benefit Plans": All employee pension benefit plans, as
defined in Section 3(2) of ERISA, employee welfare benefit plans, as defined in
Section (3)(1) of ERISA, and any deferred compensation, performance, bonus,
incentive, vacation pay, holiday pay, severance, insurance, retirement, excess
benefit, fringe benefit or other plan, trust or arrangement, whether or not
covered by ERISA, whether written or oral, for the benefit of the Business
employees.

        1.17 "ERISA": The Employee Retirement Income Security Act of 1974, as
amended.

        1.18 "Encumbrance": Any security interest, mortgage, lien, charge,
option, easement, license, adverse claim or restriction of any kind, including,
but not limited to, any restriction on the use, transfer, voting, receipt of
income or other exercise of any attributes of ownership.

        1.19 "Environment": The air, ground (surface and subsurface) or water
(surface and groundwater).

        1.20 "Environmental and Safety Law": Any federal, state, local or other
law, statute, rule, ordinance or regulation or any common law (now or hereafter
in effect) pertaining to public or worker health, welfare or safety or the
Environment, including, but not limited to, the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, 42 U.S.C. Section 9601 et
seq., as amended by the Superfund Amendments and Reauthorization Act of 1986;
the


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Resource Conservation and Recovery Act of 1976, as amended, 42 U.S.C. Section
6901 et seq.; the Federal Clean Air Act, 42 U.S.C. Section 7401-7626; the
Federal Water Pollution Control Act and Federal Clean Water Act of 1977, as
amended, 33 U.S.C. Section 1251 et seq.; the Federal Insecticide, Fungicide and
Rodenticide Act, 7 U.S.C. Section 135 et seq.; the Federal Environmental
Pesticide Control Act, the Federal Toxic Substances Control Act, 15 U.S.C.
Section 2601 et seq.; the Federal Safe Drinking Water Act, 42 U.S.C. Section
300(f) et seq.; the Emergency Planning and Community Right-To-Know Act of 1986,
42 U.S.C. Section 11001 et seq.; the Occupational Safety and Health Act of 1970,
29 U.S.C. Section 651 et seq.; the Energy Reorganization Act of 1974, P.L.
93-438, 42 U.S.C. Sections 5801, et seq.; the Texas Department of Health, Bureau
of Radiation Control regulations, 25 TAC Section 289, et seq., under the
authority of Tex. Rev. Civ. Stat. Ann. Art. 4590f, et seq.; Federal Drug
Administration regulations, 21 C.F.R. Part 310, et seq., under the authority of
21 U.S.C. Sections 321 et seq. and 42 U.S.C. 216 et seq.; Texas Department of
Health, Drugs and Medical Devices Division regulations, 25 TAC Section 229 et
seq., under the authority of Tex. Health & Safety Code Chapter 431: Texas Food,
Drug, and Cosmetic Act; and the rules and regulations of the Texas Natural
Resources Conservation Commission.

        1.21 "Excluded Assets": As defined in Section 2.2.

        1.22 "Excluded Liabilities": As defined in Section 2.4.

        1.23 "Excluded Real Property": As defined in Section 2.2.4.

        1.24 "Facilities": The Jim Christal Property, and all plants, buildings,
structures and improvements located thereon, including the cyclotron building.

        1.25 "Financial Statements": As defined in Section 5.5.

        1.26 "Governmental Body": Any federal, state or other court or
governmental body, any subdivision, agency, commission or authority thereof, or
any quasi-governmental or private body exercising any regulatory or taxing
authority thereunder, domestic or foreign.

        1.27 "Hazardous Materials": Any hazardous or toxic substances, materials
and wastes, including, but not limited to, those substances included in the
definitions of "Hazardous Substances," "Hazardous Materials," "Toxic
Substances," "Hazardous Waste," "Solid Waste," "Pollutant," or "Contaminant" in
any Environmental and Safety Law and the Hazardous Material Transportation Act,
49 U.S.C. Section 1801 et seq., and in the regulations promulgated pursuant to
those laws; those substances listed in the United States Department of
Transportation Table (49 C.F.R. Section 172.101 and any amendments thereto);
such other substances, materials and wastes which now or hereafter are regulated
or are classified as hazardous or toxic by any Governmental Body; asbestos,
polychlorinated biphenyls and oil and petroleum products or by-products; and
radioactive waste, radioactive substances, radioactive products, pollutants,
wastes or contaminants.

        1.28 "Imagyn": Imagyn Medical Technologies, Inc.

        1.29 "Imagyn Lease Agreement": As defined in Section 8.13.

        1.30 "indemnified party": As defined in Section 14.5.

        1.31 "indemnifying party": As defined in Section 14.5.


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        1.32 "Intellectual Property": As defined in Section 2.1.4.

        1.33 "Inventory": The inventories of Seller described in Section 2.1.3.

        1.33.1 "Jim Christal Property": The real property situated at 3100 Jim
Christal Road, Denton, Texas, which real property is more particularly described
on Schedule 2.1.7.

        1.34 "Judgment": Any judgment, order, award, writ, injunction or decree
of any Governmental Body or arbitrator.

        1.35 "Loss": Any loss, damage, Judgment, debt, liability, obligation,
fine, penalty, cost or expense (including, but not limited to, any legal and
accounting fee or expense), whether or not relating to personal injury, property
damage, public or worker health, welfare or safety or the Environment and
whether or not relating to violations of or liability under Environmental and
Safety Law.

        1.36 "Material Adverse Effect"; "Material Adverse Change": Matters
concerning Seller, the Assets or the Business will be deemed to have a "Material
Adverse Effect" or to have resulted in a "Material Adverse Change" only if,
individually or in the aggregate, they would, or reasonably could be expected
to, materially decrease the value of the Assets in the hands of Buyer,
materially interfere with Buyer's ability to operate the Business following the
Closing, or result in material liability to Buyer that Buyer has not expressly
agreed to assume pursuant to this Agreement.

        1.37 "Note": As defined in Section 3.1.

        1.38 "1999 Balance Sheet": As defined in Section 5.5.

        1.39 "Operating Amount": As defined in Section 3.1.

        1.40 "Permit": Any permit, license, approval, certification, endorsement
or qualification of any Governmental Body or any other person or entity.

        1.40.1 "Permitted Encumbrance": An Encumbrance specifically agreed to by
Buyer and listed on Schedule 2.1.

        1.41 "Personal Property": As defined in Section 5.8.

        1.42 "Preferred Shareholders ": Holders of shares of Seller's Series A
Convertible Redeemable Preferred Stock and Series B 7% Convertibles Redeemable
Preferred Stock.

        1.43 "Purchase Price": As defined in Section 3.1.

        1.44 "Purchased Real Property": The real property described in Section
2.1.7.

        1.45 "Relevant Employees": As defined in Section 5.13.

        1.46 "Remedial Action": Any investigation, site assessment, monitoring
or other evaluation of conditions relating to the Environment at a site, or any
clean-up, treatment,


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containment, removal, restoration, corrective action or remedial work involving
any Hazardous Materials.

        1.47 "Restricted Activities": As defined in Section 13.1.

        1.48 "Tax" or "Taxes": All taxes, charges, fees, levies or other
assessments, including, without limitation, income, excise, gross receipts,
personal property, real property, sales, use, ad valorem, transfer, franchise,
profits, license, withholding, payroll, employment, severance, stamp,
occupation, windfall profits, social security and unemployment or other taxes
imposed by the United States or any agency or instrumentality thereof, any
state, county, local or foreign government, or any agency or instrumentality
thereof, and any interest or fines, and any and all penalties or additions
relating to such taxes, charges, fees, levies or other assessments.

        1.49 "Third-Party Claim": As defined in Section 14.5.

        1.50 "Threshold": As defined in Section 14.4.

        1.51 "Transaction Documents": Any and all of the agreements and
documents referenced in Sections 8 and 9, including, without limitation, the
Warrants.

        1.52 "Transfer": As defined in Section 2.1.

        1.53 "Transmitted Copies": As defined in Section 16.10.

        1.54 "TSB": Texas State Bank.

        1.55 "TSB Agreements": As defined in Section 8.10.

        1.56 "Warrants": As defined in Section 3.1.

2.    PURCHASE AND SALE OF ASSETS

        2.1 PURCHASE AND SALE

        Subject to the terms and conditions of this Agreement, at the Closing,
Seller shall sell, transfer, convey, assign and deliver (collectively,
"transfer"), or cause to be transferred, to Buyer, free and clear of all
Encumbrances, except Permitted Encumbrances specifically listed on Schedule 2.1,
and Buyer shall purchase and acquire, all of Seller's right, title and interest
in and to all of the assets and rights (collectively, the "Assets") of every
type and description, used in or relating to the Business, whether tangible or
intangible, real, personal or mixed, wherever located and whether or not
reflected on the books and records of Seller, including, but not limited to, the
following assets and rights (but excluding the Excluded Assets):

            2.1.1 EQUIPMENT

        All machinery, equipment, furniture, computer hardware, fixtures, motor
vehicles, tooling, leasehold improvements and other tangible personal property
owned by Seller and used in or relating to the Business as of the close of
business on the Closing Date, including, without limitation, the personal
property described in Schedule 2.1.1 to the Disclosure Memorandum and such
personal


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property and fixtures used in or relating to the Business even if located on the
Excluded Real Property.

            2.1.2 EQUIPMENT AND OTHER PERSONAL PROPERTY LEASES

        All of Seller's right, title and interest in, to and under the leases
and rental agreements in respect of equipment or other tangible personal
property used in or relating to the Business as of the close of business on the
Closing Date, including, without limitation, those leases and agreements
described in Schedule 2.1.2 to the Disclosure Memorandum.

            2.1.3 INVENTORY

        All inventory, wherever located (including inventory located on the
Excluded Real Property), including raw materials, works-in-process, packaging,
finished goods, spare parts and shop and production supplies, used in or
relating to the Business as of the close of business on the Closing Date
("Inventory"), including, without limitation, the types of Inventory described
in Schedule 2.1.3 to the Disclosure Memorandum (which Schedule sets forth raw
materials, finished goods, packaging and other Inventory by location as of the
date indicated in such Schedule) and all rights of Seller to the warranties
received from suppliers and distributors and any related claims, credits, rights
of recovery and setoffs with respect to such Inventory.

            2.1.4 INTELLECTUAL PROPERTY, BOOKS AND MANUALS

        (a) All information (whether or not protectible by patent, copyright or
trade secret rights) and intellectual property rights possessed or owned by
Seller and used in or relating to the Business as now conducted or planned to be
conducted, and all right, title and interest of Seller in, to and under
licenses, sublicenses or like agreements providing Seller any right or
concession to use any information or intellectual property, and, in each case,
used in or relating to the Business as now conducted or planned to be conducted,
including all trade names, trademarks (including common-law trademarks), service
marks, art work, packaging, plates, emblems, logos, insignia and copyrights, and
their registrations and applications, and all goodwill associated therewith, all
domestic and foreign patents and patent applications, all technology, know-how,
show-how, trade secrets, manufacturing processes, formulae, drawings, designs,
systems, forms, technical manuals, data, computer programs, product information
and development work-in-progress and all documentary evidence of any of the
foregoing, including, without limitation, the trademarks, patents, patent
applications, other assets and related agreements; and (b) all books and records
(including all discs, tapes and other media storage data and information),
equipment maintenance records, warranty information, records of plant operations
and the source and disposition of materials used and produced in such plants,
standard forms of documents, manuals of operations or business procedures and
other similar procedures, including but not limited to written operating
procedures and good manufacturing practices, and all other information of Seller
used in or relating to the Business as now conducted or planned to be conducted
and, with respect to the Purchased Real Property, all soil test reports,
building inspection reports, building plans, blueprints, renderings and surveys,
including in the case of both (a) and (b) above those items described in
Schedule 2.1.4 to the Disclosure Memorandum (collectively, the "Intellectual
Property"); provided, however, that as to those standard operating procedures
that are specifically identified on Schedule 2.1.4 attached hereto as also
relating to other parts of Seller's business that are not being sold to Buyer
hereunder, Seller


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<PAGE>   12


shall retain equal and co-extensive ownership rights and may convey the same to
the purchasers of other parts of Seller's business to which such standard
operating procedures also relate.

            2.1.5 PERMITS

        All Permits used in or relating to the Business as of the close of
business on the Closing Date, to the extent actually assignable or transferable,
including, without limitation, those described in Schedule 2.1.5 to the
Disclosure Memorandum.

            2.1.6 CONTRACT RIGHTS

        All of Seller's right, title and interest in, to and under the contracts
and agreements described in Schedule 2.1.6 to the Disclosure Memorandum (the
"Contracts").

            2.1.7 PURCHASED REAL PROPERTY

        All real property, and rights thereto, owned by Seller and used in or
relating to the operation of the Business as of the close of business on the
Closing Date as described in Schedule 2.1.7 to the Disclosure Memorandum (the
"Purchased Real Property").

            2.1.8 INSURANCE PROCEEDS

        All insurance proceeds paid or payable to Seller in respect of any
damage to or destruction or loss of any assets or rights of Seller reflected on
the Schedules referred to in this Section 2.1, including any assets of Seller
that, as far as could reasonably be foreseen, would have been included in the
Assets but for such damage, destruction or loss.

            2.2 EXCLUDED ASSETS

        Seller and Buyer expressly understand and agree that Seller is not
transferring to Buyer pursuant to this Agreement any of the following assets or
rights of Seller (the "Excluded Assets"):

            2.2.1 TAX REFUNDS

        Seller's rights to refunds of Taxes paid with respect to the Business
for the periods on or prior to the Closing Date.

            2.2.2 CASH AND EQUIVALENTS

        Seller's cash, bank deposits or similar cash and cash equivalent items
existing as of the close of business on the Closing Date.

            2.2.3 ACCOUNTS RECEIVABLE

        Seller's accounts receivable existing as of the close of business on the
Closing Date.

            2.2.4 EXCLUDED REAL PROPERTY

        None of Seller's real property other than the Purchased Real Property,
or any of the rights and liabilities relating to such other real property (the
"Excluded Real Property").


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<PAGE>   13

            2.2.5 EXCLUDED CONTRACTS

        None of Seller's right, title or interest in, to or under any contracts
or agreements other than the Contracts described in Schedule 2.1.6 to the
Disclosure Memorandum.

            2.2.6 OTHER EXCLUDED ASSETS

        All other assets of Seller described in Schedule 2.2.6 to the Disclosure
Memorandum.

            2.3 ASSUMPTION OF LIABILITIES

        Upon the terms and subject to the conditions of this Agreement and
except for Excluded Liabilities, Buyer agrees, effective at the time of Closing,
to assume all obligations, contracts, and liabilities of Seller (the "Assumed
Liabilities") of any kind, character or description, relating to or arising out
of the Business from and after the Closing Date, including, without limitation,
the following:

        (a) All liabilities and obligations of Seller arising under the
Contracts and the leases and rental agreements covered by Section 2.1.2 from and
after the Closing Date;

        (b) Any liabilities and obligations relating to or arising out of any
products sold, or services rendered, by the Business from and after the Closing
Date; and

        (c) Any liabilities arising in connection with the Business or the
Assets under federal, state, local or foreign environmental or health laws from
and after the Closing Date.

        2.4 EXCLUDED LIABILITIES

        Buyer shall not assume any liabilities other than the Assumed
Liabilities, nor shall it assume any of the following obligations or
liabilities, which shall remain obligations and liabilities of Seller (all
obligations or liabilities not assumed by Buyer herein are called the "Excluded
Liabilities"):

            2.4.1 EXCLUDED REAL PROPERTY

        Any payables, claims, liabilities, fines, rents and contractual and
other obligations, contingent or otherwise, accruing or relating to the periods
on or prior to the Closing Date, in any way relating to the Excluded Real
Property.

            2.4.2 TAXES

        Except as otherwise provided in this Agreement, any liabilities for
Taxes either accruing or relating to the periods on or prior to the Closing
Date.

            2.4.3 LITIGATION

        Any claim, Judgment, penalty, settlement agreement or other obligation
to pay in respect of any Claim that is pending or threatened on or prior to the
Closing Date, including, but not limited to, those listed in Schedule 5.12 to
the Disclosure Memorandum.


                                      -8-
<PAGE>   14


            2.4.4 CLAIMS

        All claims, liabilities or other obligations that relate to injuries,
actions, omissions, conditions or events that occurred or existed on or prior to
the Closing Date, whether based on any act or omission of Seller, in connection
with the operation of the Business, including, without limitation, claims based
on workers' compensation, product liability, negligence, strict liability,
failure to warn or defective design.

            2.4.5 WARRANTIES

        Seller's liabilities and obligations pursuant to warranties (express or
implied) to customers for any products manufactured on or prior to the Closing
Date.

            2.4.6 ENVIRONMENTAL LIABILITY

        All claims and liabilities arising out of or relating to (a) the
treatment, storage or disposal on or prior to the Closing Date of Hazardous
Materials by Seller or any other person (including, without limitation, any
previous owner, lessor or sublessor) on or at the Purchased Real Property or any
other real property previously owned, leased, subleased or used by Seller in the
operation of the Business; (b) releases of Hazardous Materials on, at or from
any assets or properties, including, without limitation, the Purchased Real
Property, owned, leased, subleased or used by Seller in the operation of the
Business at any time such assets or properties were owned, leased, subleased or
used by Seller in the operation of the Business; (c) use, generation,
manufacture, shipment or transportation of Hazardous Materials by Seller in the
operation of the Business; and (d) releases of Hazardous Materials by any person
(including, without limitation, any previous owner, lessee or sublessee) on or
from the Purchased Real Property prior to Seller's ownership or use thereof.

            2.4.7 SEVERANCE COSTS

        All severance obligations and other costs of terminating employees
wherever located resulting from any termination or cessation of employment
occurring on or prior to the Closing Date, from whatever source such obligations
and costs arise, including, without limitation, contractual obligations, notices
to employees, employment manuals, course of dealings, past practices,
obligations relating to Section 2806 or 4999 of the Code, or otherwise.

            2.4.8 EMPLOYEE EXPENSES

        All liabilities and obligations with respect to either the continuation
or the termination by Seller of any Employee Benefit Plan for the benefit of the
Business's employees, except as otherwise provided by law, and all liabilities
with respect to accrued payroll, bonuses, hourly and salary vacation pay,
workers compensation liability, year-end profit sharing, state disability tax,
hourly and salary profit sharing, fringe benefits and other employee benefits
with respect to or that relate to periods of employment on or prior to the
Closing Date.

            2.4.9 ACCRUED LIABILITIES AND PAYABLES

        All liabilities accrued on or before the Closing Date, including,
without limitation, property taxes, sales and use taxes, utilities, freight
expense, inventory gain/loss and all other accrued liabilities, and any trade
payable or account payable (whether or not the same has become due and


                                      -9-
<PAGE>   15

payable), accrued expense, loan, note, advance, credit, intercompany borrowing,
liability or account allocation or other form of indebtedness of any kind or
nature incurred in connection with the Business on or prior to the Closing Date.

            2.4.10 OTHER

        All liabilities and obligations in respect of any Excluded Asset.

        2.5 INSTRUMENTS OF SALE AND TRANSFER

        On or prior to the Closing Date, Seller shall deliver to Buyer and Buyer
shall deliver to Seller, as the case may be, such instruments of sale and
assignment as shall, in the reasonable judgment of Buyer and Seller, be
effective to vest in Buyer on the Closing Date all of Seller's right, title and
interest in and to the Assets and to evidence the assumption of the Assumed
Liabilities by Buyer, including, without limitation, a Bill of Sale and
Assignment substantially in the form of Exhibit 2.5(a) (the "Bill of Sale") and
an Assignment and Assumption Agreement substantially in the form of Exhibit
2.5(b) (the "Assignment and Assumption Agreement"). Title to the Purchased Real
Property shall be conveyed by special warranty deed. Seller shall take all
reasonable additional steps as may be necessary to put Buyer in possession and
operating control of the Assets at the Closing, and Buyer shall take all
reasonable additional steps as may be necessary for it to assume the Assumed
Liabilities at the Closing.

        2.6 FURTHER ASSURANCES

        From time to time following the Closing, Buyer and Seller shall execute
and deliver, or cause to be executed and delivered, to the other such additional
instruments of conveyance and transfer and evidences of assumption as such party
may reasonably request or as may be otherwise necessary or desirable to carry
out the purposes of this Agreement.

3.    PURCHASE PRICE

        3.1 PURCHASE PRICE

        The aggregate purchase price for the Assets (the "Purchase Price") shall
be the following:

        (a) A $6 million note payable to TSB (the "Note), which Note shall
satisfy in full existing indebtedness of Seller to TSB with respect to the
Assets and the Business. The Note shall be on terms agreeable to Buyer and TSB;

        (b) Cash up to the amount of $3 million (the "Creditor Amount"), which
shall be used by Seller to pay unsecured creditors of Seller, including payment
to certain employees of Seller for accrued vacation and expense accounts as
described in Section 4.2(d);

        (c) Cash up to the amount of $3 million (the "Operating Amount"), which
shall be used by Seller to pay operating expenses of Seller, including payment
in full of all amounts owed by Seller to Buyer and TSB for operating funds
advanced to Seller as described in Section 4.2(c) below; and


                                      -10-
<PAGE>   16

        (d) Warrants to purchase 800,000 shares of Buyer's common stock (the
"Warrants"), on the terms and conditions set forth in the form of warrant
attached to this Agreement as Exhibit 3.1.

        The parties agree that for purposes of allocating the Purchase Price for
federal, state, local and other tax purposes, the fair market values of the
Assets are as set forth in Schedule 3.1 to the Disclosure Memorandum.

        3.2 ALLOCATION OF PURCHASE PRICE

        The parties agree to utilize the fair market values of the Assets on the
date of Closing, as set forth in Schedule 3.1 to the Disclosure Memorandum,
which Schedule shall be delivered at Closing, for the purpose of allocating the
Purchase Price paid hereunder for the Assets for federal, state, local and other
Tax purposes, which allocation is in accordance with Section 1060 of the Code.
Buyer and Seller shall each pay one-half of any sales and use taxes arising out
of the transfer of the Assets. Each party agrees to report the federal, state,
local and other Tax consequences of the transactions contemplated by this
Agreement and the Transaction Documents in a manner consistent with such
allocation and shall not take any position inconsistent therewith upon
examination of any Tax return, in any refund claim, or in any litigation,
investigation or otherwise. Each party shall cooperate with the other party in
the filing of Form 8594 with the U.S. Internal Revenue Service.

4.    CLOSING

        4.1 CLOSING DATE

        Subject to the terms and conditions of this Agreement, the Closing shall
take place on the earliest practicable business day (the "Closing Date") after
the satisfaction or waiver of the conditions set forth in Sections 8 and 9 at 10
a.m. local time at the offices of Locke Liddell & Sapp, LLP, 2200 Ross Avenue,
Suite 2200, Dallas, Texas, or such other date, time or location as Buyer and
Seller shall agree and shall be effective as of midnight of the Closing Date.

        4.2 CLOSING PAYMENTS

        (a) Subject to subparagraphs (b), (c) and (d) below, Buyer at Closing
shall pay to Seller the Creditor Amount and the Operating Amount set forth in
Section 3.1 by wire transfer of immediately available funds to such bank account
of Seller as it may designate in writing prior to the Closing. Buyer will
execute and deliver the Note to TSB and the Warrants to Seller at Closing.

        (b) If, prior to Closing, (i) Buyer and TSB enter into an intercreditor
agreement in a form acceptable to Buyer and (ii) Buyer is reasonably satisfied
that Imagyn is current in the payment of Imagyn's expenses in connection with
Seller's brachytherapy seed business, Buyer shall advance cash funds to Seller
on a weekly basis. The amounts of such weekly cash advances shall be determined
by Buyer in good faith after consultation with Seller.

        (c) Buyer agrees to satisfy the following obligations of Seller out of
the Operating Amount payable at Closing: (i) first, all amounts, including
interest thereon, owed to Buyer for operating funds advanced by Buyer to Seller
on and after December 4, 2000; and after satisfaction thereof (ii) then all
amounts, including interest thereon, owed by Seller to TSB for operating funds
advanced by TSB to Seller on and after January 10, 2001..


                                      -11-
<PAGE>   17

        (d) Buyer agrees to satisfy the following obligation of Seller out of
the Creditor Amount at Closing: $103,000 to be paid to certain employees of
Seller for vacation and expense accounts accrued as of February 28, 2001, as
adjusted for accruals thereafter to the date of Closing. The remainder of the
Creditor Amount shall be used to reduce accounts payable to unsecured creditors
as contemplated by Section 9.5 below.

        (e) Seller hereby authorizes Buyer, on Seller's behalf, to pay the
amounts set forth in clauses (c) and (d) directly to the affected parties at
Closing.

5.    REPRESENTATIONS AND WARRANTIES OF SELLER

        To induce Buyer to enter into and perform this Agreement, Seller
represents and warrants to Buyer (which representations and warranties shall
survive the Closing as provided in Section 14) all as follows in this Section 5:

        5.1 ORGANIZATION, GOOD STANDING, ETC.

        Seller is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation. Seller has all
requisite corporate power and authority to own, operate and lease the Assets and
its properties related to the operation of the Business and to carry on the
Business's business as now being conducted. Seller is duly qualified and
licensed as a foreign corporation to do business, and is in good standing in the
states required due to (a) the ownership or lease of real or personal property
for use in the operation of the Business's business or (b) the nature of the
Business conducted by the Business, except where the failure to be so qualified
or in good standing would not have a Material Adverse Effect.

        5.2 CORPORATE AUTHORITY

        Seller has full corporate power and authority to execute, deliver and
perform this Agreement and the Transaction Documents to which it is a party and
perform its obligations hereunder and thereunder. The execution and delivery by
Seller of this Agreement and the Transaction Documents to which it is a party,
the performance by Seller of its obligations hereunder and thereunder and the
consummation by Seller of the transactions contemplated hereby and thereby have
been duly authorized by all necessary corporate action of the Seller and its
officers, directors and shareholders. This Agreement constitutes a valid and
binding obligation of Seller, enforceable against Seller in accordance with its
terms, and the Transaction Documents to which Seller is a party, when executed
and delivered by Seller, will constitute valid and binding obligations of
Seller, enforceable against Seller in accordance with their respective terms.

        5.3 NO CONFLICT

        The execution, delivery and performance of this Agreement and the
Transaction Documents by Seller and the consummation of the transactions
contemplated hereby and thereby will not (a) violate, conflict with, or result
in any breach of, any provision of Seller's articles of incorporation or bylaws
(or equivalent documents); or (b) except as set forth in Schedule 5.3 (b),
violate, conflict with, result in any breach of, or constitute a default (or an
event that, with notice or lapse of time or both, would constitute a default)
under any Contract or Judgment to which Seller is a party or by which it is
bound or which relates to the Assets or the Business; or (c) result in the
creation of any Encumbrance on any of the Assets; or (d) violate any applicable
law, statute, rule, ordinance or

                                      -12-
<PAGE>   18


regulation of any Governmental Body; or (e) except as set forth in Schedule
5.3(e), violate or result in the suspension, revocation, modification,
invalidity or limitation of any Permits relating to the Assets or the Business;
or (f) except as set forth in Schedule 5.3(f), give any party with rights under
any Contract, Judgment or other restriction to which Seller is a party or by
which it is bound or which relates to the Assets or the Business, the right to
terminate, modify or accelerate any rights, obligations or performance under
such Contract, Judgment or restriction.

        5.4 CONSENTS AND APPROVALS

        Except as set forth in Schedule 5.4 to the Disclosure Memorandum, (a) no
consent, approval or authorization of, or declaration, filing or registration
with, any Governmental Body is required for the execution, delivery and
performance by Seller of this Agreement and the Transaction Documents to which
it is a party and for the consummation by Seller of the transactions
contemplated hereby and thereby and (b) no consent, approval or authorization of
any third party is required for the execution, delivery and performance by
Seller of this Agreement and the Transaction Documents to which it is a party
and the consummation by Seller of the transactions contemplated hereby and
thereby.

        5.5 FINANCIAL STATEMENTS

        Seller has delivered to Buyer the following financial statements of
Seller, (collectively, the "Financial Statements"): an audited balance sheet for
Seller (the "1999 Balance Sheet") as of December 31, 1999, (the "Balance Sheet
Date"), audited balance sheets for Seller and its subsidiaries as of December
31, 1998 and December 31, 1997, the related audited statements of income for
each of the years then ended, and the unaudited balance sheets for the quarters
ended March 31, June 30 and September 30, 2000. The Financial Statements were
prepared from the books and records kept by Seller and its subsidiaries and
fairly present the financial position of Seller and it subsidiaries as of their
respective dates and the results of operations of Seller and its subsidiaries
for the respective years or periods then ended, in accordance with generally
accepted accounting principles consistently applied. Each accrual reflected on
the Financial Statements is, to Seller's knowledge, adequate to meet the
liability underlying such accrual. The foregoing balance sheets reflect, as of
their respective dates, all properties and assets, real, personal or mixed, that
were used by Seller in the Business and were required to be reflected on such
balance sheets pursuant to generally accepted accounting principles consistently
applied.

        5.6 ABSENCE OF CERTAIN CHANGES OR EVENTS

        Except as set forth in Schedule 5.6 to the Disclosure Memorandum, since
December 31, 2000, and through the Closing Date, Seller has not, with respect to
the Assets or the Business:

        (a) paid any intercompany dividends or made any intercompany
distributions; or

        (b) changed the compensation and terms of employment provided to
Seller's officers and principal employees, except for changes made with the
prior knowledge and consent of Buyer.

        5.7 TAXES

        Except as set forth in Schedule 5.7, all Tax obligations of Seller with
respect to the Assets and the Business have been timely paid or are being
contested in good faith, and, except as reflected



                                      -13-
<PAGE>   19

in the balance sheets included in the Financial Statements and in any balance
sheet hereafter delivered to Buyer, Seller has no liability for any Tax
obligations with respect to the Assets and the Business and no interest or
penalties have accrued or are accruing with respect thereto, whether state,
county, local or otherwise with respect to any periods prior to the Closing Date
except, in each case, any Tax obligations that, if not timely paid by Seller,
could not result in (a) an Encumbrance on any of the Assets or (b) the
commencement of a Claim against Buyer.

        5.8 PURCHASED REAL PROPERTY

        (a) Attached as Schedule 2.1.7 to the Disclosure Memorandum is a
complete and accurate list of all Purchased Real Property, and Seller has
provided to Buyer a complete and accurate list of all personal property (the
"Personal Property") owned, leased, rented or used in the Business. Seller has
delivered to Buyer true and complete copies of all leases, subleases, rental
agreements, contracts of sale, tenancies or licenses of any portion of the
Purchased Real Property and the Personal Property.

        (b) Except as specifically described in Schedule 5.8(b), Seller has good
and marketable title to all Purchased Real Property in fee simple, free and
clear of all Encumbrances, except Permitted Encumbrances specifically listed in
Schedule 2.1, and Seller has good and marketable title to all Personal Property,
or in the case of the equipment leases described in Schedule 2.1.2 to the
Disclosure Memorandum, has the rights with respect to the leased equipment
specified therein. The Encumbrances described in Schedule 5.8(b) and the
Permitted Encumbrances specifically listed in Schedule 2.1, do not impair or
reduce the value or utility of the Purchased Real Property or the Assets in any
respect that would have a Material Adverse Effect. Seller does not lease any
Real Property used in or related to the Business.

        (c) There are no applicable adverse zoning, building or land use codes
or rules, ordinances, regulations or other restrictions relating to zoning or
land use that currently or, to Seller's knowledge after due inquiry with
applicable authorities, may prospectively prevent, or cause the imposition of
material fines or penalties as the result of the use of all or any portion of
the Purchased Real Property. Seller has received all necessary approvals with
regard to occupancy and maintenance of the Purchased Real Property.

        (d) There are no existing leases, subleases, service contracts,
tenancies or licenses of any portion of the Purchased Real Property except for
those identified in Schedule 5.8(d) to the Disclosure Memorandum, true and
complete copies of which have been delivered to Buyer by Seller and the terms of
which have been approved by Buyer.

        (e) Except as set forth on Schedule 5.8(e) to the Disclosure Memorandum,
each lease of any portion of the Purchased Real Property, and each lease,
license, rental agreement, contract of sale or other agreement to which Personal
Property is subject, is valid and in good standing, Seller has performed all
material obligations imposed on it thereunder, and neither Seller nor, to the
knowledge of Seller, any other party thereto is in material default thereunder
in any material respect, nor is there any event that with notice or lapse of
time, or both, would constitute a default thereunder by Seller or, to the
knowledge of Seller, any other party thereto. Except as set forth on Schedule
5.8(e) to the Disclosure Memorandum, Seller has not received notice, and Seller
is not otherwise aware, that any party to any such lease, license, rental
agreement, contract of sale or other agreement intends to cancel, terminate or
refuse to renew the same or to exercise or decline to


                                      -14-
<PAGE>   20

exercise any option or other right thereunder. No Purchased Real Property or
Personal Property is subject to any lease, license, contract of sale or other
agreement that could reasonably be expected to have a Material Adverse Effect.

        (f) Except (i) for assessments for Taxes not yet due and payable, (ii)
for mechanics', materialmen's, carriers' and other similar liens securing
indebtedness that is in the aggregate less than $10,000, is not yet due and
payable, and was incurred in the ordinary course of business, and (iii) as set
forth in Schedule 5.8(f), the Personal Property is free and clear of all liens,
mortgages, pledges, deeds of trust, security interest, conditional sales
agreements, charges, encumbrances and other adverse claims or interests of any
kind, and, other than personal property leased by Seller for use in the
operation of the Business and so noted on the list supplied pursuant to Section
5.8(a), Seller has good and marketable title thereto.

        (g) Except as specifically set forth in Schedule 5.8(g) to the
Disclosure Memorandum, Seller has no knowledge of any physical defect in the
Purchased Real Property that would have a Material Adverse Effect. Seller is not
in default under any covenant, condition, restriction, easement, right-of-way or
governmental approval relating to the Purchased Real Property that would have a
Material Adverse Effect.

        5.9 EQUIPMENT

        Except as set forth in Schedule 5.9, the machinery, equipment, furniture
and other physical assets included in the Assets do not have any structural
defects known to Seller, are in good operating condition and repair and are
adequate for the conduct of the Business as heretofore conducted by Seller, and
they conform to and are free of any building, fire or other violations under all
applicable zoning, pollution, health and safety and other laws, statutes, rules,
ordinances and regulations that would have a Material Adverse Effect. During the
past three years there has not been any significant interruption in the
operation of the Facilities, due to the malfunctioning of any such Assets.

        5.10 ENVIRONMENTAL AND SAFETY MATTERS

        (a) Seller has given Buyer access to all of the following:

               (i)    all communications in Seller's possession or control with
                      the U.S. Environmental Protection Agency, the U.S.
                      Department of Labor, all applicable state and local
                      authorities, including but not limited to the Texas
                      Department of Health, Bureau of Radiation Control, and all
                      other Governmental Bodies having jurisdiction over or the
                      authorization to enforce any Environmental and Safety Law,
                      relating to the operation of the Business or the ownership
                      or operation of the Assets or the Facilities;

               (ii)   all written materials in Seller's possession or control
                      relating to waste handling, storage, disposal and
                      transport practices, groundwater monitoring, effluent
                      discharges and air emissions on, at, around, under, or
                      from the Assets or the Facilities or otherwise relating to
                      the operation of the Business; and

               (iii)  all manifests of all shipments of waste relating to the
                      operation of the Business or the ownership or operation of
                      the Assets or the Facilities.


                                      -15-
<PAGE>   21

        (b) Seller has delivered to Buyer, or given Buyer access to, all of the
following:

               (i)    copies of all written documentation in Seller's possession
                      or control indicating the presence of any Hazardous
                      Materials or the release or the threat of a release of any
                      Hazardous Materials into the Environment on, at, around or
                      under the Assets or the Facilities or other properties
                      used in or related to the Business, or properties
                      currently or previously owned or leased by Seller or by
                      any third party acting on Seller's behalf and used in or
                      related to the Business, or any other locations where
                      Hazardous Materials from the Assets or the Facilities or
                      any such properties were treated, handled, stored,
                      disposed of, transported or abandoned, or any other
                      locations to which Hazardous Materials from the Assets or
                      the Facilities or any such properties were emitted,
                      discharged, spilled, migrated, released, disposed of or
                      placed;

               (ii)   copies of all Permits, whether expired, suspended, revoked
                      or presently in force, issued by the U.S. Environmental
                      Protection Agency or any state or local authorities,
                      including the Texas Department of Health, Bureau of
                      Radiation Control, that authorize or relate to the
                      generation, treatment, storage, disposal, emission,
                      discharge or release of Hazardous Materials on, at,
                      around, under or from the Assets or the Facilities, and
                      copies of all applications for such permits;

               (iii)  copies of any notices of violation or alleged violation of
                      any Environmental and Safety Law relating to activities
                      conducted by Seller at the Assets or the Facilities; and

               (iv)   copies of any environmental, health or safety audits
                      performed by or at the request of Seller relating to
                      activities conducted at the Assets or the Facilities.

        (c) Schedule 5.10 to the Disclosure Memorandum describes any and all
Judgments, Contracts, Permit conditions and pending or, to Seller's knowledge,
threatened Claims (i) that require, provide for or seek damages, injunctive
relief or any other remedy, or could cause the incurrence of costs or expenses
or result in any liability under any Environmental and Safety Law, or (ii) that
require, provide for or seek any Remedial Action, or (iii) that require, provide
for or seek any change in the present condition of or any work, repairs,
construction or capital expenditures, in each case with respect to the Assets or
the Facilities or other properties used in or related to the conduct of the
Business, or properties currently or previously owned or leased by Seller or by
any third party acting on Seller's behalf and used in or related to the
Business, or any other locations where Hazardous Materials from the Assets or
the Facilities or any such properties were treated, handled, stored, disposed,
transported or abandoned, or any other locations to which Hazardous Materials
from the Assets or the Facilities or any such properties were emitted,
discharged, spilled, migrated, released, disposed or placed. To Seller's
knowledge, except as set forth in the environmental report contemplated by
Section 8.12, there are no conditions, circumstances, activities, practices,
events, plans or actions that could interfere with, or prevent the compliance or
continued compliance with, or result in any liability under, any Environmental
and Safety Laws, any notices or demands issued thereunder or any Judgments,
Contracts or Permit conditions, or otherwise form the basis under any
Environmental and Safety Laws of any past, present or future Claims (including,
but not limited to, any Claims of the nature described in the foregoing
sentence), based on or related to the


                                      -16-
<PAGE>   22

manufacture, generation, processing, distribution, use, treatment, handling,
storage, disposal, transport or abandoning of Hazardous Materials on, at, around
or under the Assets or the Facilities or any such properties or locations, or
the emission, discharge, spill, migration, release, disposal or placing of
Hazardous Materials, or the threat of the same, into the Environment on, at,
around or under the Assets or the Facilities or any such properties or
locations.

        (d) Except as set forth in Schedule 5.10 to the Disclosure Memorandum
and except as set forth in the environmental report contemplated by Section
8.12, (i) the Assets and the Facilities and properties currently or previously
owned or leased by Seller or by any third party acting on Seller's behalf and
related to the Business are not and were not used for the manufacture,
generation, processing, treatment, storage, distribution, handling, disposal or
removal of Hazardous Materials, and (ii) the manufacture, generation,
processing, treatment, storage, distribution, handling, disposal and removal of
all Hazardous Materials from the Assets and the Facilities and such properties
have been conducted in compliance with Environmental and Safety Laws, and have
not given rise to Claims of which Seller has notice, nor to Seller's knowledge
is there any basis for any such Claims. Schedule 5.10 to the Disclosure
Memorandum contains a correct and complete list of all Hazardous Materials
currently located on the Facilities. .

        (e) Except as set forth in this Section 5.10 or in Schedule 5.10 to the
Disclosure Memorandum or the documents referenced therein and, except as set
forth in the environmental report contemplated by Section 8.12, there are no
facts known to Seller that would be material to an evaluation by Buyer of the
status of the Business or the Assets or the Facilities with respect to
compliance with Environmental and Safety Laws, or conditions that now or in the
future may require Remedial Action to achieve such compliance.

        (f) Except as set forth in the environmental report contemplated by
Section 8.12, the conduct of the Business and the ownership or operation of the
Assets and the Facilities have not given rise to any material violation of any
Environmental and Safety Law, and no material expenditures are or would be
required in order to comply with any such Environmental and Safety Law.

        5.11 CONTRACTS

        Except as set forth in Schedule 5.11 to the Disclosure Memorandum, all
of the Contracts described in Schedule 2.1.6 to the Disclosure Memorandum are
valid and in full force and effect, Seller has performed all material
obligations imposed on it thereunder, and there are not, under any of such
Contracts, any defaults or events of default on the part of Seller or, to
Seller's knowledge, any other party thereto, that would materially adversely
affect the Business or the Assets or that could reasonably be expected to
materially adversely affect the Business or the Assets. Except as set forth in
Schedule 5.11 to the Disclosure Memorandum, Seller has not received notice, nor
is Seller otherwise aware, that any party to any such Contract intends to
cancel, terminate or refuse to renew such Contract or to exercise or decline to
exercise any option or right thereunder.

        5.12 CLAIMS AND LEGAL PROCEEDINGS

        Except as specifically set forth in Schedule 5.12 to the Disclosure
Memorandum, there are no Claims pending or, to Seller's knowledge, threatened
against Seller with respect to the Business or the Assets, before or by any
Governmental Body or nongovernmental department, commission,


                                      -17-
<PAGE>   23

board, bureau, agency or instrumentality or any other person. To Seller's
knowledge, there is no valid basis for any Claim, other than as specifically set
forth in Schedule 5.12 to the Disclosure Memorandum, adverse to the Business or
the Assets by or before any Governmental Body or nongovernmental department,
commission, board, bureau, agency or instrumentality, or any other person.
Except as set forth in Schedule 5.12 to the Disclosure Memorandum, there are no
outstanding or unsatisfied judgments, orders, decrees or stipulations to which
Seller with respect to the Business or the Assets is a party, that involve the
transactions contemplated herein or that would have a Material Adverse Effect.

        5.13 LABOR MATTERS

        There are no disputes, material employee grievances or material
disciplinary actions pending or, to Seller's knowledge, threatened between
Seller and any employees of Seller who either are employed at the Business or
have been offered employment by Buyer immediately following the Closing
(collectively, the "Relevant Employees"). Seller, with respect to the Relevant
Employees, has complied in all respects with all provisions of all laws relating
to the employment of labor, except where the failure to comply would not have a
Material Adverse Effect, and has no liability for any arrears of wages or Taxes
or penalties for failure to comply with any such laws. Seller has no knowledge
of any organizational efforts presently being made or threatened by or on behalf
of any labor union with respect to any Relevant Employees.

        Except as specifically set forth in Schedule 5.13 to the Disclosure
Memorandum, Seller, with respect to the Relevant Employees, is not a party to
any:

        (a) management, employment or other contract providing for the
employment or rendition of executive services;

        (b) employment contract that is not terminable without penalty by Seller
on 30 days' notice;

        (c) bonus, incentive, deferred compensation, severance pay, pension,
profit-sharing, retirement, stock purchase, stock option, employee benefit or
similar plan, agreement or arrangement;

        (d) collective bargaining agreement or other agreement with any labor
union or other employee organization (and no such agreement is currently being
requested by, or is under discussion by management with, any group of employees
or others); or

        (e) other employment contract or other compensation agreement or
arrangement, oral and written, affecting or relating to current or former
employees of the Business.

        Except as set forth in Schedule 5.13 to the Disclosure Memorandum, all
such contracts and other agreements and arrangements set forth in Schedule 5.13
to the Disclosure Memorandum are valid, in full force and effect, Seller has
performed all material obligations imposed on it thereunder, and there are,
under any of such contracts, agreements or arrangements, no defaults or events
of default by Seller or, to its knowledge, any other party thereto that would
have a Material Adverse Affect, or that would or reasonably could be expected to
materially adversely affect the relationship of Seller or Buyer with the
Business employees.


                                      -18-
<PAGE>   24

        Seller has not made, and will not through the date of Closing make, any
loans to any officer or employee of Seller employed in the business of the
Business.

        5.14 PATENTS, TRADEMARKS AND INTELLECTUAL PROPERTY

        (a) Seller is the sole and exclusive owner of the entire right, title
and interest in and to, and has the sole and exclusive right to use, free and
clear of any payment obligation or other Encumbrance, all the patents, trade
names, trademarks, service marks, copyrights and applications for any of the
foregoing, whether registered or not, that are used in or relate to the Business
or has valid and subsisting license to use, as they are currently used, any of
the same that are not owned by Seller. Schedule 2.1.4 to the Disclosure
Memorandum is an accurate and complete list of all such patents, trade names,
trademarks, service marks, copyrights, and applications for any of the
foregoing, reflecting dates of filing or dates of issuance, if applicable or
licenses therefor. No patents, trade names, trademarks, service marks,
copyrights or applications for any of the foregoing, other than those set forth
in Schedule 2.1.4 to the Disclosure Memorandum, are or have been used in, are
necessary in connection with, or are owned by Seller and relate to the Business.
All registrations listed in Schedule 2.1.4 to the Disclosure Memorandum owned by
Seller, or to Seller's knowledge, licensed to Seller, are in good standing,
valid, subsisting and in full force and effect in accordance with their terms.
The technical information and data and other intellectual property rights to be
transferred to Buyer hereunder include all of Seller's technical information and
data and other intellectual property rights (including, but not limited to,
those of the types referenced in Section 2.1.4) relating to or used in the
Business.

        (b) To the knowledge of Seller, none of the Intellectual Property or
Seller's rights thereto are being infringed or otherwise violated by any person
or entity.

        (c) The operation of the Business and use of the Intellectual Property
by Seller does not infringe or otherwise violate any rights of any person or
entity, and there has been and is no pending or, to the knowledge of Seller,
threatened Claim alleging any such infringement or violation. In addition, there
has been and is no pending or, to the knowledge of Seller, threatened Claim
alleging any defect in or invalidity, misuse or unenforceability of, or
challenging the operation of the Business or the ownership or use of or Seller's
rights with respect to, any of the Intellectual Property, and there is no basis
for any such Claim. Furthermore, there is no other Claim made by any person or
entity pertaining to the Intellectual Property. None of the Intellectual
Property is subject to any Judgment.

        (d) The consummation of the transactions contemplated by this Agreement
and the Transaction Documents will not alter or impair any of the Intellectual
Property, and the Intellectual Property may be transferred to Buyer hereunder
without the consent or approval of any other party or Governmental Body.

        (e) The Business does not involve the employment of any person in a
manner that violates any noncompetition or nondisclosure agreement known to
Seller that such person entered into in connection with his or her employment or
activities at any time prior to employment by Seller.

        (f) Seller is operating and has operated the Business in compliance with
all export control laws, statutes, rules, ordinances and regulations promulgated
by the U.S. Food and Drug


                                      -19-
<PAGE>   25

Administration (the "FDA"); the U.S. Department of Transportation; the U.S.
Environmental Protection Agency; the Texas Department of Health, Bureau of
Radiation Control; the Texas Natural Resources Conservation Commission; and the
Texas Department of Health, Bureau of Food, Drug and Medical Devices
(collectively, the "Designated Regulators") and, to Seller's knowledge, of any
other Governmental Body. Seller has not received any notice alleging that its
conduct of the Business violates any such laws, statutes, rules, ordinances or
regulations, nor is Seller aware of any basis for any Claim alleging the same.

        (g) The Business and the Facilities are in full technical compliance
with the current Good Manufacturing Practices regulations established by the
FDA.

        5.15 LICENSES, PERMITS, AUTHORIZATIONS, ETC.

        Seller has received all currently required governmental approvals,
authorizations, consents, licenses, orders, registrations and permits of all
agencies, whether federal, state, local or foreign, related to the operation of
the Business, except such approvals, authorizations, consents, licenses, orders,
registrations and permits the failure to obtain which will not have a Material
Adverse Effect.

        5.16 COMPLIANCE WITH LAW

        Seller is and has been in compliance with all laws, statutes, rules,
ordinances, regulations and judgments promulgated by the Designated Regulators,
and, except where the failure to comply with which would not have a Material
Adverse Effect, any other Governmental Body, applicable to the ownership or
operation of the Assets, the Facilities or the Business. Except as disclosed to
Buyer pursuant to Section 5.10(b)(iii), Seller has not received any notice of
any alleged violation (whether past or present and whether remedied or not), nor
is Seller aware of any basis for any claim of any such violation, of any such
law, statute, rule, ordinance, regulation or Judgment. To Seller's knowledge,
there is no law, statute, rule, ordinance or regulation promulgated by any
Governmental Body or any Judgment that would have a Material Adverse Affect.

        5.17 PERMITS AND QUALIFICATIONS

        All Permits issued by the Designated Regulators, and, to Seller's
knowledge, by any other Governmental Body, that are required for the ownership
or operation of the Assets or the Facilities or the operation of the Business
have been obtained by Seller, are in full force and effect. All material Permits
issued by the Designated Regulators are listed in Schedule 2.1.5 to the
Disclosure Memorandum, with their expiration dates, if any. Seller is and has
been in compliance with all such Permits, except as would not have a Material
Adverse Effect, and Seller has not received any notice of any alleged violation
(whether past or present and whether remedied or not) of, nor any threat of the
suspension, revocation, modification, invalidity or limitation of, any such
Permit, nor is Seller aware of any basis for any claim of any such violation or
any such threat. All such Permits that are transferable will be effectively
assigned to Buyer without additional liability to Buyer upon the Closing, or
upon compliance after the Closing with applicable recording, registration or
filing procedures set forth in Schedule 5.4 to the Disclosure Memorandum.


                                      -20-
<PAGE>   26

        5.18 INSURANCE

        Seller has, with respect to the Business and the Assets, maintained
adequate insurance protection against all liabilities, Claims and risks against
which it is customary for corporations engaged in the same or a similar business
similarly situated to insure.

        5.19 EMPLOYEE PLANS

        Seller maintains for the benefit of current or former employees of the
Business only those Employee Benefit Plans listed on Schedule 5.19 to the
Disclosure Memorandum. Seller is not now a contributing employer to any
"multi-employer plan" as described in Section 4001(a)(3) of ERISA with respect
to any employees of the Business. Seller has not been a contributing employer to
any "multi-employer" plan with respect to employees of the Business in the past
five years. Each and every pension plan (as defined in Section 3(1) of ERISA)
maintained by Seller for the benefit of the employees of the Business has been
issued a favorable determination letter with respect to its qualified status
under Section 401(a) of the Code by the U.S. Internal Revenue Service, or an
application for such a determination letter has been filed with the U.S.
Internal Revenue Service within the requisite time period to allow Seller to
make remedial amendments for such qualification purposes. With respect to
employees of the Business, Seller is in compliance with the healthcare
continuation coverage requirements of the Consolidated Omnibus Budget
Reconciliation Act of 1985, Section 4980B of the Code, and proposed regulations
issued by the U.S. Internal Revenue Service.

        5.20 EXCLUDED ASSETS

        None of the Excluded Assets is related to or used in the Business for
any purpose. All assets associated with the Business are included in the Assets.

        5.21 BROKERAGE

        Seller has not retained any broker or finder in connection with the
transactions contemplated by this Agreement. Any brokerage or finder's fee due
to any broker or finder in violation of the foregoing representation shall be
paid by Seller.

        5.22 ACCREDITED INVESTOR

        (a) Seller has received all the information it considers necessary or
appropriate for deciding whether to acquire the Warrants. Seller further
represents that it has had an opportunity to ask questions of and receive
answers from Buyer regarding the terms and conditions of the offering of the
Warrants and the shares of common stock of Buyer to be received upon exercise of
the Warrants (the "Buyer Common Stock," the Warrants and the Buyer Common Stock
together being referred to herein as the "Securities") and the business,
properties, prospects and financial condition of Buyer.

        (b) Seller is an "accredited investor" within the meaning of Rule 501 of
Regulation D promulgated under the Securities Act of 1933, as amended (the
"Securities Act").

        (c) Seller understands that the Securities have not been registered
under the Securities Act, by reason of a specific exemption from the
registration provisions of the Securities Act which


                                      -21-
<PAGE>   27


depends upon, among other things, the bona fide nature of the investment or
non-distributive intent and the accuracy of Seller's representations as
expressed herein. Seller understands that the Securities are characterized as
"restricted securities" under applicable U.S. federal and state securities laws
and that, pursuant to these laws, Seller must hold the Securities indefinitely
unless subsequently registered with the Securities and Exchange Commission and
qualified by state authorities, or an exemption from such registration and
qualification requirements is available. Other than as contained in the
applicable Transaction Documents, Seller acknowledges that Buyer has no
obligation to register or qualify the Securities for resale.

        5.23 ONGOING BUSINESS

        Seller will continue to engage in one or more lines of business after
Closing and will apply a portion of the Purchase Price into its continuing
business.

        5.24 FULL DISCLOSURE

        Seller has disclosed to Buyer in writing all material facts and
information relating to the Assets and the Business. No information furnished by
Seller to Buyer in connection with this Agreement (including, but not limited
to, the Financial Statements and all information in the Schedules to the
Disclosure Memorandum) is false or misleading in any material respect. In
connection with such information and with this Agreement and the transactions
contemplated hereby, Seller has not made any untrue statement of a material fact
or omitted to state a material fact necessary in order to make the statements
made or information delivered, in the light of the circumstances under which
they were made, not misleading.

6.    REPRESENTATIONS AND WARRANTIES OF BUYER

        To induce Seller to enter into this Agreement, Buyer represents and
warrants to Seller (which representations and warranties shall survive the
Closing as provided in Section 14) all as follows in this Section 6:

        6.1 ORGANIZATION, GOOD STANDING, POWER, ETC.

        Buyer is a corporation duly organized, validly existing and in good
standing under the laws of the State of Washington. Buyer has all requisite
power and authority to own or lease and operate its assets and to carry on its
business as it is now conducted.

        6.2 TRANSACTION DOCUMENTS

        Buyer has full corporate power and authority to execute, deliver and
perform this Agreement and the Transaction Documents to which it is a party and
perform its obligations hereunder and thereunder. The execution and delivery by
Buyer of this Agreement and the Transaction Documents to which it is a party,
the performance by Buyer of its obligations hereunder and thereunder and the
consummation by Buyer of the transactions contemplated hereby and thereby have
been duly authorized by all necessary corporate action of Buyer and its
officers, directors and shareholders. This Agreement constitutes a valid and
binding obligation of Buyer, enforceable against Buyer in accordance with its
terms, and the Transaction Documents to which Buyer is a party, when executed
and delivered by Buyer, will constitute valid and binding obligations of Buyer,
enforceable against Buyer in accordance with their terms.


                                      -22-
<PAGE>   28


        6.3 NO CONFLICT

        Neither the execution and delivery by Buyer of this Agreement or the
Transaction Documents to which Buyer is a party, the performance by Buyer of its
obligations hereunder or thereunder, nor the consummation of the transactions
contemplated hereby or thereby will (a) violate, conflict with or result in any
breach of any provision of Buyer's articles of incorporation or bylaws; or (b)
violate, conflict with, result in any breach of, or constitute a default (or an
event that, with notice or lapse of time or both, would constitute a default)
under any Contract or Judgment to which Buyer is party or by which it is bound;
or (c) violate any applicable law, statute, rule, ordinance or regulation of any
Governmental Body.

        6.4 CLAIMS AND LOCAL PROCEEDINGS

        There are no Claims pending or, to the knowledge of Buyer, threatened
against Buyer, before or by any Governmental Body or nongovernmental department,
commission, board, bureau, agency or instrumentality, or any other person, and
there are no outstanding or unsatisfied Judgments or stipulations to which Buyer
is a party that involve the transactions contemplated herein or that would alone
or in the aggregate have a material adverse effect on the business, business
prospects, assets or financial condition of Buyer.

        6.5 BROKERAGE

        Except for Bay City Capital, Buyer has not retained any broker or finder
in connection with the transactions contemplated by this Agreement. Any
brokerage or finder's fee due to [Bay City Capital and] any broker or finder in
violation of the foregoing representation shall be paid by Buyer.

        6.6 WARRANT

        (a) The Warrants, when issued, sold and delivered in accordance with the
terms of this Agreement and the Transaction Documents will be duly and validly
issued, fully paid, and nonassessable, and will be free of restrictions on
transfer other than restrictions on transfer under the Transaction Documents and
under applicable state and federal securities laws.

        (b) The Buyer Common Stock issuable upon exercise of the Warrants
purchased under this Agreement have been duly and validly reserved for issuance
and, upon issuance in accordance with the terms of the Warrants and for the
consideration stated therein, will be duly and validly issued, fully paid and
non-assessable and will be free of restrictions on transfer other than
restrictions on transfer arising (i) under the terms of the Warrant, this
Agreement and the other Transaction Documents and (ii) under federal and state
securities laws.

        6.7 CONSENTS AND APPROVALS

        Except as contemplated in Section 8 below, (a) no consent, approval or
authorization of, or declaration, filing or registration with, any Governmental
Body is required for the execution, delivery and performance by Buyer of this
Agreement and the Transaction Documents to which it is a party and for the
consummation by Buyer of the transactions contemplated hereby and thereby and
(b) no consent, approval or authorization of any third party is required for the
execution, delivery and performance by Buyer of this Agreement and the
Transaction Documents to which it is a party and the consummation by Buyer of
the transactions contemplated hereby and thereby.


                                      -23-
<PAGE>   29

7.    CERTAIN COVENANTS

        7.1 ACCESS

        (a) Prior to the Closing Date, Seller shall (i) give Buyer and its
accounting, legal, business, environmental, engineering, intellectual property
and other authorized representatives and advisors full access, during normal
business hours, to all plants, offices, warehouses and other facilities and
properties of Seller relating to the Assets and the Business, (ii) furnish Buyer
and its authorized representatives and advisors with all documents and
information relating to the Assets and the Business as may be reasonably
requested by Buyer and its authorized representatives and advisors, (iii) permit
Buyer and its authorized representatives and advisors to review all books,
records and Contracts relating to the Assets and the Business as may be
reasonably requested by Buyer and its authorized representatives and advisors,
and make copies thereof, (iv) make available Seller's employees and advisors,
including those responsible for the management of the Business, and cause
Seller's employees and advisors to furnish Buyer and its authorized
representatives and advisors with data and other information with respect to the
Assets and the Business as may be reasonably requested by Buyer and its
authorized representatives and advisors, and discuss with Buyer and its
authorized representatives and advisors the affairs of the Business, and (v)
fully cooperate with Buyer and its authorized representatives and advisors in
their investigation and examination of the Assets and the affairs of the
Business. Except as provided in Sections 14.2 and 14.9, no investigation, or
receipt of information provided by or on behalf of Seller or review thereof by
Buyer or its representatives or advisors shall diminish or obviate, or relieve
Seller from, or affect Buyer's ability or right to rely on, any of the
representations, warranties, covenants and agreements of Seller contained in
this Agreement and the Transaction Documents.

        (b) In the event that the Closing under this Agreement shall not occur,
in addition to the obligations of the parties set out in Section 15.2, Buyer
shall keep confidential and not use or disclose to any party any confidential
information acquired by Buyer from Seller pursuant to this Section 7.1 or
otherwise disclosed in connection with the negotiation of this Agreement, unless
Seller shall give its written consent to the contrary; provided, however, that
the foregoing obligations of confidentiality and non-use shall not apply to any
information which (i) at the time of disclosure is, or thereafter becomes,
available to the public through no breach of this Agreement by Buyer; or (ii)
was known to, or otherwise in the possession of, Buyer or its Affiliates prior
to the receipt of such information from Seller; or (iii) is obtained by Buyer
from a source other than Seller and other than one who would be breaching a
commitment of confidentiality to Seller by disclosing the information to Buyer;
or (iv) is developed by Buyer or its Affiliates independently of Seller's
confidential information; or (v) is required to be disclosed by Buyer in
connection with a pending Claim; and provided further that in the event Buyer
becomes required in connection with a pending Claim to disclose any of the
information acquired from Seller in connection with this Agreement, then Buyer
shall provide Seller with reasonable notice so that Seller may seek a court
order protecting against or limiting such disclosure or any other appropriate
remedy; and in the event such protective order or other remedy is not sought, or
is sought but not obtained, Buyer shall furnish only that portion of the
information which is required and shall endeavor, at Seller's expense, to obtain
a protective order or other assurance that the portion of the information
furnished by Buyer will be accorded confidential treatment. The obligations of
Buyer set forth in this Section 7.1(b) shall be in effect for a period of five
years from the date of this Agreement.


                                      -24-
<PAGE>   30

        7.2 ASSIGNMENT OF CONTRACTS

        (a) Subject to the terms and conditions of this Agreement, as of the
Closing Date, Seller shall assign to Buyer all of the right, title and interest
of Seller in and under all Contracts that constitute any of the Assets, and
Buyer shall assume the liabilities and obligations of Seller arising under such
Contracts after the Closing Date; provided, however, that Buyer shall not
succeed to or assume, and Seller shall be responsible for, any liability or
obligation arising out of any or all of the following: (i) any breach by Seller
of any such Contract or any failure by Seller to discharge or perform any
liability or obligation arising on or prior to the Closing Date under any such
Contract; (ii) any Claim based on claims relating to products manufactured,
shipped or sold by Seller on or prior to the Closing Date; (iii) any Claim
resulting from any act or omission of Seller on or prior to the Closing Date;
and (iv) any Claim relating to any Excluded Contract.

        (b) If any Contract constituting any of the Assets is not assignable by
Seller to Buyer without the consent of a third party, or will not continue in
effect after the Closing and such assignment without the consent of a third
party, then Seller shall use its best efforts to provide Buyer with such
third-party consent prior to the Closing Date to the satisfaction of Buyer (but
if Seller's assignment or attempted assignment of any such Contract prior to
obtaining the third-party consent would constitute a breach of such Contract,
then such assignment or attempted assignment shall not be or be deemed effective
unless and until the third-party consent is obtained). Buyer shall render such
cooperation as is reasonably required to assist Seller in obtaining such
third-party consent.

        7.3 CONDUCT OF BUSINESS PRIOR TO CLOSING

            7.3.1

        Except for actions taken with the prior written consent of Buyer, from
the date of this Agreement until the Closing Date, and except to the extent
Seller acting in good faith is precluded from doing so by lack of funding and in
writing so advises Buyer with reasonable specificity, and Seller shall:

        (a) maintain the Business and the Assets intact;

        (b) maintain the Transferred Real Property, plants, buildings,
structures and other improvements and machinery and equipment constituting any
of the Assets in good operating condition and repair;

        (c) make payments and filings required to continue the Intellectual
Property and continue to prosecute and maintain all pending applications
therefor in all jurisdictions in which such applications are pending; and

        (d) comply with all Judgments, all laws, statutes, rules, ordinances and
regulations promulgated by any Governmental Body and all Permits applicable to
the operation the Business or the ownership or operation of the Assets or the
Facilities, and maintain, and prosecute applications for, such Permits and pay
all Taxes, assessments and other charges applicable thereto.


                                      -25-
<PAGE>   31

            7.3.2

        Except for actions taken with the prior consent of Buyer, from the date
of this Agreement until the Closing Date, Seller shall not take or permit to
exist any action or condition specified in Section 5.6, and Seller shall:

        (a) promptly advise Buyer in writing of any Material Adverse Change,
including prompt notification in writing of any outstanding or threatened
claims, legal, administrative or other proceedings involving Seller or its
personnel that could have a Material Adverse Effect;

        (b) use its best efforts not take any action, or omit to take any
action, that would result in any of Seller's representations and warranties made
herein being inaccurate at the time of such action or omission as if made at and
as of such time;

        (c) give written notice to Buyer promptly upon becoming aware of any
inaccuracy in any material respect of any of Seller's representations or
warranties made herein or in the Disclosure Memorandum or of any event or state
of facts that would result in any such representation or warranty being
inaccurate in any material respect at the time of such event or state of facts
as if made at and as of such time (any such notice to describe such inaccuracy,
event or state of facts in reasonable detail); and

        (d) not solicit, approach or furnish information to any prospective
buyer, or negotiate with any third party concerning the sale or transfer of the
Assets, the Business or any part thereof, whether any of such actions are taken
directly or indirectly, through a representative or otherwise.

        7.4 COVENANTS TO SATISFY CONDITIONS

        Each party shall proceed with all reasonable diligence and use its best
efforts to satisfy or cause to be satisfied all of the conditions precedent to
the other party's obligation to purchase or sell the Assets that are set forth
in Section 8 or 9, as the case may be, insofar as such matters are within the
control of such party; provided, however, that this provision shall not impose
upon Buyer or Seller any obligation to incur unreasonable expenses under the
circumstances in order to fulfill any condition contained in such Sections, and,
in the case of Seller acting in good faith and with prior written notice to
Buyer, is subject to the availability of funds therefor.

8.    CONDITIONS PRECEDENT TO OBLIGATIONS OF BUYER

        The obligation of Buyer to purchase the Assets at the Closing shall be
subject to the satisfaction at or prior to the Closing of each of the following
conditions, any one or more of which may be waived by Buyer:

        8.1 NO INJUNCTION OR LITIGATION; COMPLIANCE WITH LAWS

        (a) As of the Closing Date, there shall not be any Claim or Judgment of
any nature or type threatened, pending or made by or before any Governmental
Body that questions or challenges the lawfulness of the transactions
contemplated by this Agreement or the Transaction Documents under any law or
regulation or seeks to delay, restrain or prevent such transactions.


                                      -26-
<PAGE>   32

        (b) The consummation of the transactions contemplated by this Agreement
and the Transaction Documents and the performance by Buyer of its obligations
pursuant to this Agreement and the Transaction Documents shall be legally
permitted by all laws and regulations to which Buyer is subject.

        8.2 REPRESENTATIONS, WARRANTIES AND COVENANTS

        (a) The representations and warranties of Seller made in this Agreement,
the Transaction Documents and any certificate furnished pursuant hereto or
thereto shall be true, complete and correct on and as of the Closing Date with
the same force and effect as though made on and as of the Closing Date;

        (b) Seller shall have performed and complied with the covenants and
agreements required by this Agreement to be performed and complied with by it on
or prior to the Closing Date; and

        (c) Seller shall have delivered to Buyer a certificate dated the Closing
Date to the foregoing effects, signed by a duly authorized executive officer of
Seller.

        Provided that Seller has at all times acted in good faith and with
reasonable diligence, the conditions of this Section 8.2 shall be deem satisfied
unless any failures of such representations and warranties of Seller to be true,
complete and correct on and as of the Closing Date (ignoring for such purpose
any materiality or knowledge qualifications contained in any particular
representation or warranty), and any failures to perform and comply with such
covenants and agreements, would, taken in the aggregate, have a Material Adverse
Effect.

        8.3 NO ADVERSE CHANGES

        From the date of this Agreement to the Closing Date, there shall not
have been any Material Adverse Change, and Seller shall have no knowledge of any
Material Adverse Change which is threatened (other than threatened solely as a
result of Seller's lack of funding for future operations); and Seller shall have
delivered to Buyer a certificate dated the Closing Date to the foregoing effects
signed by a duly authorized executive officer of Seller.

        8.4 CONSENTS AND APPROVALS

        (a) The principal terms of this Agreement and the Transaction Documents,
and all transactions contemplated hereby and thereby shall have been approved by
Seller's shareholders to the extent required by Seller's Articles of
Incorporation and applicable law.

        (b) All consents, approvals or authorizations of, or declarations,
filings or registrations with, all Governmental Bodies required for the
consummation of the transactions contemplated by this Agreement and the
Transaction Documents shall have been obtained or made on terms satisfactory to
Buyer and shall be in full force and effect. Without limiting the generality of
the foregoing, all consents, approvals and authorizations necessary for the
transfer to Buyer of all Permits of all Governmental Bodies held by Seller with
respect to the Business, as listed in Schedule 2.1.5 to the Disclosure
Memorandum, shall have been obtained and such consents, approvals and
authorizations shall be in full force and effect or shall, in Buyer's reasonable
judgment, be obtainable after the Closing Date upon compliance with applicable
recording, registration or


                                      -27-
<PAGE>   33

filing procedures and without additional liability to Buyer. Buyer shall have
been granted all Permits of all Governmental Bodies substantially equivalent to
those held by Seller with respect to the Business, as listed in Schedule 2.1.5
to the Disclosure Memorandum, without having to accept any significantly more
burdensome conditions than are now imposed on Seller under such Permits or such
Permits shall, in Buyer's reasonable judgment, be obtainable after the Closing
Date upon such terms. Furthermore all consents, approvals or authorizations of
any other third parties required for the consummation of the transactions
contemplated by this Agreement and the Transaction Documents, including, but not
limited to, all consents of any third parties required for the assignment to
Buyer of any Contracts that constitute any of the Assets and the continuation in
effect of such Contracts following the Closing and such assignment, and all
Permits of any Governmental Bodies (including but not limited to all
certifications, endorsements and qualifications required by the state and
federal radiation regulatory authorities and the FDA) required in connection
with the conduct by Buyer of the Business following the Closing in the manner
heretofore conducted by Seller, shall have been obtained to the satisfaction of
Buyer and shall be in full force and effect or shall, in Buyer's reasonable
judgment, be obtainable after the Closing Date upon compliance with applicable
recording, registration or filing procedures and without additional liability to
Buyer. In addition, the originals of all the consents, approvals, authorizations
and Permits referenced in this Section 8.4 shall have been delivered to Buyer.

        8.5 TAXES

        All Taxes and other assessments applicable to the Assets that are due
and owing as of the Closing Date shall have been paid, except for Taxes and
assessments to be apportioned between the parties as of the Closing pursuant to
Section 11.3 or paid pursuant to Section 11.1.

        8.6 DELIVERY OF DOCUMENTS

        Seller shall deliver the following documents, agreements and supporting
papers to Buyer at the Closing, and the delivery of each shall be a condition to
Buyer's performance of its obligations to be performed at the Closing:

        (a) an executed Bill of Sale;

        (b) a counterpart of the Assignment and Assumption Agreement executed by
Seller;

        (c) an executed and acknowledged special warranty deed conveying title
to the Purchased Real Property in due form for recordation with the appropriate
Governmental Body, and all other instruments necessary to record such deed,
together with a certified check for all applicable recording fees and Seller's
share of any transfer taxes;

        (d) policies of title insurance from a title insurance company selected
by Buyer, dated as of the Closing Date, insuring that Buyer has fee simple title
to each parcel of the Purchased Real Property, with face values equal to the
values allocated to the Purchased Real Property under Section 3.1, together
with, an endorsement as to no Encumbrances (other than Permitted Encumbrances
specifically listed in Schedule 2.1) and such other endorsements as are
reasonably required by Buyer and are available in the State of Texas, as the
case may be;


                                      -28-
<PAGE>   34

        (e) executed certificates, affidavits or other documents relating to
transfer taxes, or excise taxes, documentary stamp taxes or gains taxes imposed
by a Governmental Body due to transfer of the Purchased Real Property;

        (f) an executed nonforeign certificate in accordance with Section 1445
of the Code and the regulations issued thereunder;

        (g) any and all certificates of title relating to Personal Property
included within the Assets;

        (h) written consent to assignment (in form and substance reasonably
satisfactory to Buyer) of all agreements listed on Schedule 5.3(b) to the
Disclosure Memorandum; and

        (i) UCC-3 lien releases and other required certificates, documents and
filing terminating all security interests on the Assets.

        8.7 LEGAL OPINION

        Seller shall have delivered to Buyer the opinion of Seller's counsel,
Locke Liddell & Sapp, LLP, dated the Closing Date, substantially in the form of
Exhibit 8.7 hereto.

        8.8 SATISFACTION OF CONDITIONS

        All agreements and other documents required to be delivered by Seller
hereunder on or prior to the Closing Date shall be satisfactory in the
reasonable judgment of Buyer and its counsel. Buyer shall have received such
other agreements, documents and information as it may reasonably request in
order to establish satisfaction of the conditions set forth in this Section 8.

        8.9 EMPLOYMENT AND NONCOMPETITION ARRANGEMENTS

        Each of the employees listed on Schedule 8.9 shall have executed a
letter agreement, in form satisfactory to Buyer and shall have executed Buyer's
standard form of Confidentiality, Noncompetition and Invention Assignment
Agreement and each such letter and agreement shall remain in full force and
effect on the Closing Date.

        8.10 AGREEMENT WITH TEXAS STATE BANK; ASSUMPTION OF BANK DEBT

        TSB, Seller and Buyer shall have executed, prior to the Closing, a
written agreement or agreements (the "TSB Agreements"), providing for, among
other things, restructuring of $6,000,000 of Seller's existing debt to TSB on
terms and conditions acceptable to Buyer and delivery of the Note to TSB. TSB
and Seller shall have fulfilled their respective obligations under the TSB
Agreements to be performed at or prior to Closing.

        8.11 OPINION AS TO ENVIRONMENTAL MATTERS

        Buyer shall have received a report of an outside engineering firm
assessing environmental compliance, potential risks, hazards and liabilities in
connection with the Real Property, and the contents and findings of such report
shall be satisfactory to Buyer in its sole discretion.


                                      -29-
<PAGE>   35


        8.12 IMAGYN LEASE AGREEMENT

        Prior to the Closing, Buyer and Imagyn shall have executed a lease
agreement on terms acceptable to Buyer in its sole discretion (the "Imagyn Lease
Agreement").

        8.13 UNIVERSITY OF NORTH TEXAS LEASE AGREEMENT

        Prior to the Closing, Buyer and the University of North Texas shall have
executed a lease agreement on terms acceptable to Buyer in its sole discretion,
for the 42 MeV cyclotron and all appurtenances related thereto (the "Cyclotron
Lease Agreement").

        8.14 LICENSE TO BACKGROUND INTELLECTUAL PROPERTY

        (a) Immediately prior to the Closing, Seller shall have granted to Buyer
and its subsidiaries and affiliates (now or hereafter existing) a royalty-free,
fully paid-up, perpetual, worldwide, nonexclusive license (with right to
sublicense) to all Background Intellectual Property (as hereafter defined) for
use in the fields of nuclear medicine, nuclear research, radioisotopes,
pharmaceuticals, diagnostics and medical devices. For purposes hereof,
"Background Intellectual Property" shall mean all information and intellectual
property rights owned or controlled by Seller as of the date of this Agreement
or acquired after the date of this Agreement and prior to Closing that are not
included in the definition of Intellectual Property that is to be transferred to
Buyer pursuant to Section 2 and that are not Excluded Assets listed in Schedule
2.2.6(c).

        (b) Immediately prior to the Closing, Seller shall have granted to Buyer
and its subsidiaries and affiliates (now or hereafter existing) a royalty-free,
fully paid-up, perpetual, worldwide, nonexclusive license (with right to
sublicense) under U.S. Patent application [*] and including all (i)
continuation, continuation in-part, divisional or substitute applications
thereof, (ii) patents that issue thereon and any reissues, and (iii) foreign
counterparts of such applications and patents for use in the fields of nuclear
medicine, nuclear research, radioisotopes, pharmaceuticals, diagnostics and
medical devices.

        (c) Immediately prior to the Closing, Seller shall have granted to Buyer
and its subsidiaries and affiliates (now or hereafter existing) a royalty-free,
fully paid-up, perpetual, worldwide, nonexclusive license (with right to
sublicense) under U.S. Patent application [*] and including all (i)
continuation, continuation in-part, divisional or substitute applications
thereof, (ii) patents that issue thereon and any reissues, and (iii) foreign
counterparts of such applications and patents for use in the fields of nuclear
medicine, nuclear research, radioisotopes, pharmaceuticals, diagnostics and
medical devices.

     [*] DESIGNATES PORTIONS OF THIS DOCUMENT THAT HAVE BEEN OMITTED PURSUANT TO
         A REQUEST FOR CONFIDENTIAL TREATMENT FILED SEPARATELY WITH THE
         COMMISSION.

9.    CONDITIONS PRECEDENT TO OBLIGATIONS OF SELLER

        The obligation of Seller to sell the Assets to Buyer at the Closing
shall be subject to the satisfaction at or prior to the Closing of each of the
following conditions, any one or more of which may be waived by Seller:


                                      -30-
<PAGE>   36


        9.1 NO INJUNCTION OR LITIGATION

        As of the Closing Date, there shall not be any Claim or Judgment of any
nature or type threatened, pending or made by or before any Governmental Body
that questions or challenges the lawfulness of the transactions contemplated by
this Agreement or the Transaction Documents under any law or regulation or seeks
to delay, restrain or prevent such transactions.

        9.2 REPRESENTATIONS, WARRANTIES AND COVENANTS

        (a) The representations and warranties of Buyer made in this Agreement
or in the Transaction Documents or any certificate furnished pursuant hereto or
thereto shall be true, complete and correct on and as of the Closing Date with
the same force and effect as though made on and as of the Closing Date;

        (b) Buyer shall have performed and complied with the covenants and
agreements required by this Agreement to be performed and complied with by it on
or prior to the Closing Date; and

        (c) Buyer shall have delivered to Seller a certificate dated the Closing
Date to the foregoing effects signed by a duly authorized executive officer of
Buyer.

        9.3 DELIVERY OF DOCUMENTS

        Buyer shall have executed and delivered to Seller the Assignment and
Assumption Agreement relating to Contracts, substantially in the form of Exhibit
2.5(b) hereto, and the Warrant.

        9.4 LEGAL OPINION

        Buyer shall have delivered to Seller the opinion of Buyer's counsel,
Perkins Coie LLP, dated the Closing Date, substantially in the form of Exhibit
9.4 hereto.

        9.5 AGREEMENT WITH TEXAS STATE BANK; ASSUMPTION OF BANK DEBT

        TSB, Seller and Buyer shall have executed, prior to the Closing, the TSB
Agreements, providing for, among other things, restructuring of $6,000,000 of
Seller's existing debt to TSB on terms and conditions acceptable to Buyer and
delivery of the Note to TSB. TSB and Buyer shall have fulfilled their respective
obligations under the TSB Agreements concurrent with the Closing.

        9.5 OBLIGATIONS TO UNSECURED CREDITORS

        Accounts payable to unsecured creditors of Seller, including, without
limitation, William Nicholson, Lon Morgan and Carl Seidel, shall have been
reduced to not more than $500,000 in the aggregate.

        9.6 IMAGYN CLOSING

        The sale of certain assets of Seller's brachytherapy seed business to
Imagyn contemplated by the Asset Purchase Agreement dated March 20, 2001 between
Seller and Imagyn shall have been


                                      -31-
<PAGE>   37

consummated, and Seller shall have received cash in an amount not less than
$5,000,000, plus or minus the adjustments provided for in section 2.04 of such
agreement, as a result thereof.

        9.7 LINAC AND BRACCO AGREEMENT

        Seller shall not have reasonable cause to believe (i) that the Shady
Oaks property and the linear accelerator ("LINAC") will not be able to be
purchased by Antich Medical Imaging Inc. ("AMII") for at least $8,000,000 or
(ii) that Seller will not be relieved of its obligations under the Manufacturing
and Distribution Agreement dated May 14, 1998 between Seller and Bracco in
connection with such purchase by AMII.

        9.8 TSB AGREEMENT

        TSB shall have entered into an agreement with Seller, upon terms and
conditions reasonably satisfactory to Seller, (i) to provide a line of credit
agreement to Seller from and after the Closing; (ii) to provide Seller a
$500,000 draw loan, for a period of not less than nine months after Closing, to
be used solely to keep the LINAC facility and equipment operationally viable and
to pay reasonable and necessary salary and expenses of a third party retained by
Seller to sell the LINAC facility and equipment; (iii) to renew and extend, for
a period of not less than nine months after Closing, up to $7,225,000 of
Seller's pre-January 10, 2001 debt, all upon the terms and conditions
contemplated by the letter dated February 21, 2001 from counsel for TSB to
counsel for Seller.

        9.9 UNIVERSITY OF NORTH TEXAS LEASE AGREEMENT

        Prior to the Closing, Buyer and the University of North Texas shall have
executed the "Cyclotron Lease Agreement."

        9.10 SATISFACTION OF CONDITIONS

        All agreements and other documents required to be delivered by Buyer
hereunder on or prior to the Closing Date shall be satisfactory in the
reasonable judgment of Seller and its counsel. Seller shall have received such
other agreements, documents and information as it may reasonably request in
order to establish satisfaction of the conditions set forth in this Section 9.

10.   CERTAIN POST-CLOSING COVENANTS

        10.1 FURTHER ASSURANCES

        After the Closing Date, Seller shall from time to time at Buyer's
request execute and deliver, or cause to be executed and delivered, such further
instruments of conveyance, assignment and transfer or other documents, and
perform such further acts and obtain such further consents, approvals and
authorizations, as Buyer may reasonably require in order to fully effect the
conveyance and transfer to Buyer of, or perfect Buyer's right, title and
interest in, any of the Assets, to assist Buyer in obtaining possession of any
of the Assets, or to otherwise comply with the provisions of this Agreement and
consummate the transactions contemplated by this Agreement and the Transaction
Documents.

        After the Closing Date, Buyer shall from time to time at Seller's
request execute and deliver, or cause to be executed and delivered, such further
instruments of assumption or other documents,


                                      -32-
<PAGE>   38


and perform such further acts and obtain such further consents, approvals and
authorizations, as Seller may reasonably require in order to fully effect the
assumption by Buyer of the Assumed Liabilities, or to otherwise comply with the
provisions of this Agreement and consummate the transactions contemplated by
this Agreement and the Transaction Documents.

        10.2 BOOKS AND RECORDS

        Not later than 15 days after the Closing Date, Seller shall deliver to
Buyer (a) all of the technical information and data and other intellectual
property rights to be transferred hereunder (including all of the Assets
referenced in Section 2.1.4) which have been reduced to writing, (b) all of the
original Contracts referenced in Section 2.1.6, and (c) all of the books,
records, information and materials referenced in Section 2.1.4(b).

        10.3 POST-CLOSING COOPERATION

        After the Closing Date, each party shall provide the other party with
such reasonable assistance (without charge) as may be requested by the other
party in connection with any Claim or audit of any kind or nature whatsoever or
the preparation of any response, demand, inquiry, filing, disclosure or the like
(including, but not limited to, any tax return or form) relating to the Assets
or the Business.

11.   TAXES AND COSTS; APPORTIONMENT

        11.1 TRANSFER TAXES

        Seller shall be responsible for the payment of all transfer, sales and
use and documentary taxes, filing and recordation fees (including fees for the
recordation of the deeds to the Purchased Real Property included in the Assets)
and similar charges relating to the sale or transfer of the Assets hereunder.
Buyer shall furnish Seller with any necessary certificates of Tax exemption.

        11.2 TRANSACTION COSTS

        Each party shall be responsible for its own costs and expenses incurred
in connection with the preparation, negotiation and delivery of this Agreement
and the Transaction Documents, including but not limited to attorneys' and
accountants' fees and expenses. The title insurance policy referenced in Section
8.6(d) shall be obtained at Buyer's expense.

        11.3 APPORTIONMENT

        Any and all real property taxes, personal property taxes, assessments,
lease rentals, fuel, and other charges applicable to the Assets will be
pro-rated to the Closing Date, and such taxes and other charges shall be
allocated between the parties by adjustment at the Closing, or as soon
thereafter as the parties may agree. All such taxes shall be allocated on the
basis of the fiscal year of the tax jurisdiction in question.

12.   BULK SALES

        Buyer waives compliance with bulk sales laws, if any, applicable to the
transactions contemplated by this Agreement and the Transaction Documents.


                                      -33-
<PAGE>   39


13.   COVENANTS NOT TO COMPETE

        13.1 COVENANTS

        In consideration of the payment of $50,000 allocated from the Purchase
Price by Buyer to Seller at the Closing, Seller covenants and agrees as follows:

        (a) During the three-year period commencing on the Closing Date, neither
Seller nor any of Seller's Affiliates shall engage in any Restricted Activities
(as such term is defined below), whether directly or indirectly, for its account
or otherwise, or as a shareholder, owner, partner, principal, agent, joint
venturer, consultant, advisor, franchiser or franchisee, independent contractor
or otherwise, in, with or of any person or entity that engages directly or
indirectly in any Restricted Activities. As used herein, "Restricted Activities"
shall mean the development, manufacture or sale of any radioactive or
nonradioactive pharmaceuticals or medical devices, either therapeutic or
diagnostic, anywhere in North America, excluding brachytherapy seeds.
"Restricted Activities" shall not include the development, manufacture or sale
of radioactive materials not subject to approval by the FDA.

        (b) During the two-year period commencing on the Closing Date, neither
Seller nor any of its Affiliates shall, directly or indirectly, hire, or solicit
or encourage to leave the employment of Buyer or any of its Affiliates, any
former employee of the Business hired by Buyer or its Affiliates or any employee
of Buyer or its Affiliates engaged in any Restricted Activities or have any
arrangement (financial, consulting or otherwise) with any such individual.

        13.2 MINOR INVESTMENTS

        Notwithstanding the provisions of Section 13.1(a) above, Seller and its
Affiliates may at any time own in the aggregate, directly or indirectly, for
investment purposes only, 1% or less of any class of securities of any entity
traded on any national securities exchange or quoted on the Nasdaq National
Market.

        13.3 REMEDIES

        Seller acknowledges that compliance with the provisions of this Section
13 is necessary and proper to preserve and protect the Assets acquired by Buyer
under this Agreement and to assure that the parties receive the benefits
intended to be conveyed pursuant to this Section 13. Seller agrees that any
failure by Seller or any of its Affiliates to comply with the provisions of this
Section 13 shall entitle Buyer and its Affiliates, in addition to such other
relief and remedies as may be available, to equitable relief, including, but not
limited to, the remedy of injunction. Resort to any remedy shall not prevent the
concurrent or subsequent employment of any other remedy, or preclude the
recovery by Buyer and its Affiliates of monetary damages and compensation.

14.   SURVIVAL AND INDEMNIFICATION

        14.1 SURVIVAL

        All representations and warranties of Seller and Buyer contained in this
Agreement or in the Transaction Documents or in any certificate delivered
pursuant hereto or thereto and Claims for indemnification shall survive the
Closing for a period of one year after the Closing, except that (a)


                                      -34-
<PAGE>   40

Claims with respect to the matters covered by the representations and warranties
in Section 5.10 (Environmental and Safety Matters) and (b) Claims by Buyer
arising under Section 14.2(e), each shall survive for a period of two years
after the Closing. The covenants and agreements of Seller and Buyer contained in
this Agreement or in the Transaction Documents shall survive the Closing and
shall continue until all obligations with respect thereto shall have been
performed or satisfied or shall have been terminated in accordance with their
terms.

        14.2 INDEMNIFICATION BY SELLER

        From and after the Closing Date, Seller shall indemnify and hold Buyer
and its Affiliates harmless from and against, and shall reimburse Buyer and its
Affiliates for, any and all Losses arising out of or in connection with:

        (a) any inaccuracy in any representation or warranty made by Seller in
this Agreement or in the Transaction Documents or in any certificate delivered
pursuant hereto or thereto;

        (b) any failure by Seller to perform or comply with any covenant or
agreement in this Agreement or in the Transaction Documents;

        (c) any claim by any person or entity for brokerage or finder's fees or
commissions or similar payments based upon any agreement or understanding
alleged to have been made by such person or entity directly or indirectly with
Seller or any of its officers, directors or employees in connection with any of
the transactions contemplated by this Agreement or the Transaction Documents;

        (d) the conduct of the Business, the ownership or operation of the
Assets or the Facilities on or prior to the Closing Date, including, but not
limited to, any Losses arising out of or in connection with any Claims and
Judgments relating to the Business, the Assets or the Facilities which are
pending or entered on or prior to the Closing Date or as to which Seller has
received notice on or prior to the Closing Date;

        (e) (i) the manufacture, generation, processing, distribution, use,
treatment, handling, storage, disposal, transport or abandoning of any material
(including but not limited to any Hazardous Materials) on, at, around or under
the Assets or the Facilities, or properties currently or previously owned or
leased by Seller or by any third party acting on Seller's behalf and related to
the Business, or the emission, discharge, spill, migration, release, disposal or
placing of any material (including but not limited to any Hazardous Materials),
or the threat of the same, into the Environment on, at, around or under the
Assets or the Facilities or such properties, (ii) the treatment, handling,
storage, disposal, transport or abandoning of any material (including, but not
limited to, any Hazardous Materials) from the Assets or the Facilities or such
properties to, on, at, around or under any other locations, (iii) the emission,
discharge, spill, migration, release, disposal or placing of any material
(including, but not limited to, any Hazardous Materials) from the Assets or the
Facilities or such properties, or the threat of the same, into the Environment
on, at, around or under any other locations, or (iv) the conduct of the
Business, the ownership or operation of the Assets or the Facilities, and which
Losses are related to public or worker health, welfare or safety or the
Environment and based on conditions existing on the Closing Date or which arise
after the Closing Date on account of events, acts or omissions occurring on or
prior to the Closing Date; any Losses referenced in this Section 14.2(e) may
include any Losses (including, but not limited to, any costs,


                                      -35-
<PAGE>   41

liabilities or obligations relating to contractors or consultants' fees, or
negotiations, administration, oversight, operation, maintenance or capital
expenditures) associated with any Remedial Action which is performed in
connection with any Claim brought by any Governmental Body or any other person
or entity (including, but not limited to, any threatened enforcement action or
any action under any Environmental and Safety Law), or any Remedial Action which
is performed by or on behalf of Buyer or its Affiliates in the absence of a
Claim brought by any Governmental Body or any other person or entity; or

        (f) any failure to comply with any applicable bulk sales laws in
connection with the transactions contemplated by this Agreement or the
Transaction Documents; or

        (g) any Claim relating to any business or assets of Seller or its
Affiliates not acquired by Buyer hereunder, or any obligations or liabilities of
Seller or its Affiliates not assumed by Buyer hereunder.

        Notwithstanding any other provision in this Agreement, Seller shall have
no liability for, and no obligation to indemnify Buyer with respect to, any
inaccuracy in or breach of any representation or warranty contained in this
Agreement or any Transaction Document or any failure (other than a willful
failure) by Seller to perform or comply with any covenant or agreement in this
Agreement or the Transaction Documents, if Seller provided Buyer written notice
describing with reasonable specificity such inaccuracy, breach or failure prior
to the Closing and Buyer elected to consummate the transactions contemplated
hereby after receipt of such written notice.

        14.3 INDEMNIFICATION BY BUYER

        From and after the Closing Date, Buyer shall indemnify and hold harmless
Seller and its Affiliates from and against, and shall reimburse Seller and its
Affiliates for, any and all Losses arising out of or in connection with:

        (a) any inaccuracy in any representation or warranty made by Buyer in
this Agreement or in the Transaction Documents or in any certificate delivered
pursuant hereto or thereto;

        (b) any failure by Buyer to perform or comply with any covenant or
agreement in this Agreement or the Transaction Documents;

        (c) the conduct of the Business, the ownership or operation of the
Assets or the Facilities after the Closing Date, except as to those matters as
to which Seller is obligated to indemnify Buyer pursuant to Section 14.2 hereof;
and

        (d) any Claim by any person or entity for brokerage or finders' fees or
commissions or similar payments based upon any agreement or understanding
alleged to have been made by such person or entity directly or indirectly with
Buyer or any of its officers, directors or employees in connection with any of
the transactions contemplated by the Agreement or the Transaction Documents.

        14.4 THRESHOLD AND TIME LIMITATIONS

        Neither party or its Affiliates shall be entitled to receive any
indemnification payment with respect to Claims for indemnification made under
Section 14.2 or 14.3, as the case may be, until the


                                      -36-
<PAGE>   42


aggregate Losses that such party and its Affiliates would be otherwise entitled
to receive as indemnification with respect to the Claims exceed one hundred
thousand dollars ($100,000) (the "Threshold"), in which case such party and its
Affiliates shall be entitled to receive indemnification payment only for the
amount of aggregate Losses in excess of the Threshold. Furthermore, neither
party or its Affiliates shall be entitled to assert any right of indemnification
with respect to any Claim of which neither such party or its Affiliates have
given written notice to the other party on or prior to the end of the applicable
survival period set forth in Section 14.1 above, except that if such party or
its Affiliates have given written notice setting out such Claim with reasonable
specificity to the other party on or prior to the end of such survival period,
then they shall continue to have the right to be indemnified with respect to
such pending Claim, notwithstanding the expiration of such survival period.

        14.5 PROCEDURE

        (a) Any party hereto or any of its Affiliates seeking indemnification
hereunder (in this context, the "indemnified party") shall notify the other
party (in this context, the "indemnifying party") in writing reasonably promptly
after the assertion against the indemnified party of any Claim by a third party
(a "Third-Party Claim") in respect of which the indemnified party intends to
base a Claim for indemnification hereunder, but the failure or delay so to
notify the indemnifying party shall not relieve it of any obligation or
liability that it may have to the indemnified party except to the extent that
the indemnifying party demonstrates that its ability to defend or resolve such
Third Party Claim is adversely affected thereby.

        (b) (i) Subject to the provisions of Sections 14.5(f) below, the
indemnifying party shall have the right, upon written notice given to the
indemnified party within 30 days after receipt of the notice from the
indemnified party of any Third Party Claim, to assume the defense or handling of
such Third Party Claim, at the indemnifying party's sole expense, in which case
the provisions of Section 14.5(b)(ii) below shall govern. (ii) The indemnifying
party shall select counsel reasonably acceptable to the indemnified party in
connection with conducting the defense or handling of such Third Party Claim,
and the indemnifying party shall defend or handle the same in consultation with
the indemnified party, and shall keep the indemnified party timely apprised of
the status of such Third Party Claim. The indemnifying party shall not, without
the prior written consent of the indemnified party, which consent shall not be
unreasonably withheld, agree to a settlement of any Third Party Claim The
indemnified party shall cooperate with the indemnifying party and shall be
entitled to participate in the defense or handling of such Third Party Claim
with its own counsel and at its own expense.

        (c) (i) If the indemnifying party does not give written notice to the
indemnified party, within 30 days after receipt of the notice from the
indemnified party of any Third Party Claim, of the indemnifying party's election
to assume the defense or handling of such Third Party Claim, the provisions of
Section 14(c)(ii) below shall govern. (ii) The indemnified party may, at the
indemnifying party's expense, select counsel in connection with conducting the
defense or handling of such Third Party Claim and defend or handle such Third
Party Claim in such manner as it may deem appropriate, provided, however, that
the indemnified party shall keep the indemnifying party timely apprised of the
status of such Third Party Claim and shall not settle such Third Party Claim
without the prior written consent of the indemnifying party, which consent shall
not be unreasonably withheld. If the indemnified party defends or handles such
Third Party Claim, the indemnifying



                                      -37-
<PAGE>   43

party shall cooperate with the indemnified party and shall be entitled to
participate in the defense or handling of such Third Party Claim with its own
counsel and at its own expense.

        (d) If the indemnified party intends to seek indemnification hereunder,
other than for a Third Party Claim, then it shall notify the indemnifying party
in writing within sixty (60) days after its discovery of facts upon which it
intends to base its Claim for indemnification hereunder, but the failure or
delay so to notify the indemnifying party shall not relieve the indemnifying
party of any obligation or liability that the indemnifying party may have to the
indemnified party except to the extent that the indemnifying party demonstrates
that the indemnifying party's ability to defend or resolve such Claim is
adversely affected thereby.

        (e) The indemnified party may notify the indemnifying party with respect
to a Claim even though the amount thereof plus the amount of other Claims
previously notified by the indemnified party aggregate less than the Threshold.

        (f) Notwithstanding anything in this Agreement to the contrary, in
connection with any Remedial Action, the Losses with respect to which are
covered in Section 14.2(e), Buyer and its Affiliates shall have the right, at
their election, and regardless of whether a Third Party Claim is involved or
not, to manage, administer, direct and regulate all activities relating to the
Remedial Action, including, but not limited to, the right to select and direct
the activities of contractors, consultants and counsel, to communicate directly,
lead discussions and make final agreements with any Governmental Body or any
other person or entity, to design and implement the Remedial Action and to
defend or handle any Claims relating to the Remedial Action in such manner as
they may deem appropriate, in each case with such advice and consultation as
Seller may provide, and Buyer and its Affiliates shall give good faith
consideration to such advice and consultation. If Buyer or its Affiliates elect
to manage the activities relating to the Remedial Action, they shall keep Seller
timely apprised of any material event relating to the Remedial Action to allow
Seller the opportunity for informed and meaningful participation in the Remedial
Action process, and Seller shall be entitled to participate in the activities
arising out of the Remedial Action with its own counsel and at its own expense.
Each party and its Affiliates shall cooperate with the other party and its
Affiliates in good faith in connection with the Remedial Action. Any costs and
expenses incurred by Buyer or its Affiliates in connection with the Remedial
Action shall be promptly reimbursed by Seller upon demand, or promptly paid by
Seller directly, at the option of Buyer or its Affiliates.

        14.6 PROPORTIONAL LIABILITY FOR LOSSES

        In the event any Losses referred to in this Section 14 are attributable
to or arise out of or in connection with the conduct of the Business in part
both before and after the Closing Date, each party shall indemnify the other
party and its Affiliates against such Losses in proportion to the extent to
which the Losses resulted from such pre-Closing or post-Closing activities.

        14.7 ELECTION OF REMEDIES

        In the event that any party or any of its Affiliates alleges that it is
entitled to indemnification hereunder, and that its Claim is covered under more
than one provision of this Section 14, such party or Affiliate shall be entitled
to elect the provision or provisions under which it may bring a claim for
indemnification.



                                      -38-
<PAGE>   44

        14.8 SPECIFIC PERFORMANCE

        The parties to this Agreement acknowledge that it may be impossible to
measure in money the damages that a party would incur if any covenant or
agreement contained in this Agreement were not performed in accordance with its
terms and agree that each of the parties hereto shall be entitled to obtain an
injunction to require specific performance of, and prevent any violation of the
terms of, this Agreement, in addition to any other remedy available hereunder.
In any such action specifically to enforce any provision of this Agreement, each
party hereby waives any claim or defense therein that an adequate remedy at law
or in damages exists.

        14.9 EXCLUSIVE REMEDIES

        Except with respect to claims based on knowing and willful acts of
either party, , the indemnification and specific performance remedies set forth
under this Section 14 shall constitute the sole and exclusive remedies of the
parties with respect to any matters arising under or relating to this Agreement.

15.   TERMINATION

        15.1 TERMINATION

        This Agreement may be terminated at any time before the Closing:

        (a) by Seller, by giving written notice to Buyer at any time, if any of
the conditions set forth in Section 9 is not satisfied at the time at which the
Closing (as it may be deferred pursuant to Section 4) would otherwise occur, or
if the satisfaction of any such condition is or becomes impossible;

        (b) by Buyer, by giving written notice to Seller at any time, if any of
the conditions set forth in Section 8 is not satisfied at the time at which the
Closing (as it may be deferred pursuant to Section 4) would otherwise occur, or
if the satisfaction of any such condition is or becomes impossible;

        (c) by Seller, by giving written notice to Buyer at any time, if Buyer
materially has breached any representation, warranty, covenant or agreement
contained in this Agreement and such breach is not cured within 5 calendar days
of the date of such written notice;

        (d) by Buyer, by giving written notice to Seller at any time, if Seller
materially has breached any representation, warranty, covenant or agreement
contained in this Agreement and such breach is not cured within 5 calendar days
of the date of such written notice;

        (e) by mutual written agreement of Seller and Buyer; and

        (f) by either party, by giving written notice to the other party, at any
time after April 30, 2001.



                                      -39-
<PAGE>   45

        15.2 EFFECT OF TERMINATION

        In the event of the termination of this Agreement pursuant to Section
15.1 above, (a) each party shall return or destroy all documents containing
confidential information of the other party (and, upon request, certify as to
the destruction thereof), and (b) no party hereto shall have any liability or
further obligation to the other party hereunder, except for obligations of
confidentiality and non-use with respect to the other party's confidential
information, which shall survive the termination of this Agreement, and except
for liabilities or obligations relating to any willful and material breach of
any party of any representation, warranty, covenant or agreement set forth
herein.

16.   MISCELLANEOUS

        16.1 CONFIDENTIALITY OBLIGATIONS OF SELLER FOLLOWING THE CLOSING

        From and after the Closing, Seller shall keep confidential and not use
or disclose to any party any confidential information relating to the assets,
business or affairs of Buyer or the Assets or the Business. The confidentiality
and non-use obligations set forth in this Section 16.1 shall not apply to any
information which is available to the public through no breach of this Agreement
by Seller, or is disclosed to Seller by third parties who are not under any duty
of confidentiality with respect thereto, or is required to be disclosed by
Seller in connection with pending litigation or investigation; provided,
however, that in the event Seller becomes required in connection with pending
litigation or investigation to disclose any of the confidential information
relating to the assets, business or affairs of Buyer or the Assets or the
Business, then Seller shall provide Buyer with reasonable notice so that Buyer
may seek a court order protecting against or limiting such disclosure or any
other appropriate remedy; and in the event such protective order or other remedy
is not sought, or is sought but not obtained, Seller shall furnish only that
portion of the information that is required and shall endeavor, at Buyer's
expense, to obtain a protective order or other assurance that the portion of the
information furnished by Seller will be accorded confidential treatment.

        16.2 PUBLIC ANNOUNCEMENTS

        Each party agrees not to make any public announcement in regard to the
transactions contemplated by this Agreement and the Transaction Documents
without the other party's prior consent, except as may be required be law, in
which case the parties shall use reasonable efforts to coordinate with each
other with respect to the timing, form and content of such required disclosures.

        16.3 SEVERABILITY

        If any court determines that any part or provision of this Agreement is
invalid or unenforceable, the remainder of this Agreement shall not be affected
thereby and shall be given full force and effect and remain binding upon the
parties. Furthermore the court shall have the power to replace the invalid or
unenforceable part or provision with a provision that accomplishes, to the
extent possible, the original business purpose of such part or provision in a
valid and enforceable manner. Such replacement shall apply only with respect to
the particular jurisdiction in which the adjudication is made. Without in any
way limiting the generality of the foregoing, it is understood and agreed that
this Section 16.3 shall apply to the provisions of Section 13 and that the
provisions of Section 13, as they relate to each jurisdiction within their
geographical scope, constitute separate and distinct covenants.


                                      -40-
<PAGE>   46


        16.4 MODIFICATION AND WAIVER

        This Agreement may not be amended or modified in any manner, except by
an instrument in writing signed by each of the parties hereto. The failure of
any party to enforce at any time any of the provisions of this Agreement shall
in no way be construed to be a waiver of any such provision, or in any way
affect the right of such party thereafter to enforce each and every such
provision. No waiver of any breach of this Agreement shall be deemed to be a
waiver of any other or subsequent breach.

        16.5 NOTICES

        All notices and other communications required or permitted to be given
under this Agreement shall be in writing and shall be sent by facsimile
transmission, or mailed postage prepaid by first-class certified or registered
mail, or mailed by a nationally recognized express courier service, or
hand-delivered

        TO BUYER:          NeoRx Corporation
                           410 West Harrison Street
                           Seattle, Washington 98119-4007
                           Fax: (206) 284-7112
                           Attention:  Paul G. Abrams, Chief Executive Officer
        with a copy to:    Perkins Coie LLP
                           1201 Third Avenue, 48th Floor
                           Seattle, Washington 98101-3099
                           Fax: (206) 583-8500
                           Attention:     Faith M. Wilson
        TO SELLER:         International Isotopes Inc.
                           1500 Spencer Road
                           Denton, Texas   76205
                           Fax: (940) 323-2613
                           Attention:  David Camp, Chief Executive Officer
        with a copy to:    Locke Liddell & Sapp, LLC
                           100 Congress Avenue, Suite 300
                           Austin, Texas   78701-4800
                           Fax: (512) 305-4800
                           Attention:  Curtis R. Ashmos

        Either party may change the persons or addresses to which any notices or
other communications to it should be addressed by notifying the other party as
provided above. Any notice or other communication, if addressed and sent, mailed
or delivered as provided above, shall be deemed given or received three days
after the date of mailing as indicated on the certified or registered mail
receipt, or on the next business day if mailed by express courier service, or on
the date of delivery or transmission if hand-delivered or sent by facsimile
transmission, provided that confirmation of delivery is given by such express
courier or confirmation of transmission of such facsimile transmission is
received by the sending party.


                                      -41-
<PAGE>   47


        16.6 ASSIGNMENT

        Neither Seller nor Buyer may assign any of its rights or obligations
hereunder without the prior written consent of the other party. Notwithstanding
the foregoing, Buyer may assign its rights and obligations under this Agreement
to any Affiliate of Buyer, and furthermore Buyer may assign its rights and
obligations hereunder to any successor of Buyer in the conduct of the Business
after the Closing and Seller may allow the grant of a security interest herein
pursuant to its agreements with TSB; provided, however, that any such assignment
by Buyer or Seller shall not relieve Buyer or Seller from its obligations
hereunder. This Agreement shall be binding upon and inure to the benefit of the
parties and their respective successors and assigns.

        16.7 CAPTIONS

        The captions and headings used in this Agreement have been inserted for
convenience of reference only and shall not be considered part of this Agreement
or be used in the interpretation thereof.

        16.8 ENTIRE AGREEMENT

        This Agreement (together with the Transaction Documents) constitutes the
entire agreement and understanding between the parties with respect to the
subject matter hereof and supersedes all prior agreements, understandings,
negotiations, representations and statements, whether oral, written, implied or
expressed, relating to such subject matter.

        16.9 NO THIRD-PARTY RIGHTS

        Nothing in this Agreement is intended, nor shall be construed, to confer
upon any person or entity other than Buyer and Seller (and only to the extent
expressly provided herein, their respective Affiliates) any right or remedy
under or by reason of this Agreement.

        16.10 COUNTERPARTS

        This Agreement may be executed and delivered (including by facsimile
transmission) in one or more counterparts, and by the different parties hereto
in separate counterparts, each of which when executed and delivered shall be
deemed to be an original but all of which taken together shall constitute one
and the same agreement. To expedite the process of entering into this Agreement,
the parties acknowledge that Transmitted Copies of this Agreement will be
equivalent to original documents until such time as original documents are
completely executed and delivered. "Transmitted Copies" will mean copies that
are reproduced or transmitted via photocopy, facsimile or other process of
complete and accurate reproduction and transmission.

        16.11 GOVERNING LAW

        This Agreement shall be governed by, and construed in accordance with,
the laws of the State of Washington.

        [Signatures follow on next page]


                                      -42-
<PAGE>   48


        IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed by their respective representatives hereunto authorized as of the day
and year first above written.

                                      INTERNATIONAL ISOTOPES INC.


                                      By________________________________________
                                      Title_____________________________________

                                      NEORX CORPORATION


                                      By________________________________________
                                      Title_____________________________________


                                      -43-
<PAGE>   49


                                                                  Exhibit 2.5(a)
                                                     to Asset Purchase Agreement


                           BILL OF SALE AND ASSIGNMENT


        KNOW ALL MEN BY THESE PRESENTS, that International Isotopes Inc., a
Texas corporation ("Seller"), for good and valuable consideration, the receipt
and adequacy of which are hereby acknowledged by it, does hereby sell, transfer,
convey, assign and deliver to NeoRx Corporation, a Washington corporation
("Buyer"), all of Seller's right, title and interest in and to the Assets, as
defined in the Asset Purchase Agreement (the "Agreement") between Seller and
Buyer dated March ___, 2001, which is incorporated herein by reference.

        Seller warrants that it has good, valid and marketable title to the
Assets, free and clear of any lien or encumbrance, except as otherwise provided
in the Agreement.

        This Bill of Sale and Assignment is being delivered in connection with
the Agreement and is subject to, and is entitled to the benefits in respect of,
the Agreement.

        This Bill of Sale and Assignment shall be binding upon and inure to the
benefit of Buyer and Seller and their respective successors and assigns.

        IN WITNESS WHEREOF, Seller has caused its duly authorized representative
to execute this Bill of Sale and Assignment as of this ____ day of March, 2001.



                                      International Isotopes Inc.

                                      By________________________________________

                                      Title_____________________________________


                                      -44-
<PAGE>   50

                                                                  Exhibit 2.5(b)
                                                     to Asset Purchase Agreement



                       ASSIGNMENT AND ASSUMPTION AGREEMENT

        Assignment and Assumption Agreement dated as of this ____ day of March,
2001, by and between International Isotopes Inc., a Texas corporation
("Seller"), and NeoRx Corporation, a Washington corporation ("Buyer").

        WHEREAS, Seller and Buyer have entered into an Asset Purchase Agreement
dated as of March __, 2001 (the "Agreement");

        NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged by the parties, the parties hereby
agree as follows:

        All capitalized terms used but not otherwise defined herein shall have
the meanings ascribed to them in the Agreement.

        Subject to the terms and conditions of the Agreement, Seller hereby
assigns to Buyer as of the Closing Date all of the right, title and interest of
Seller in and under the Contracts listed in SCHEDULE 2.1.6 to the Disclosure
Memorandum and all Personal Property leases and agreements relating to the
Assets and the Business, including but not limited to the Personal Property
leases and agreements described in SECTION 2.1.7 to the Disclosure Memorandum.
Subject to the terms and conditions of the Agreement, Buyer hereby assumes as of
the Closing Date the liabilities and obligations of Seller arising under the
Contracts and such Personal Property leases and agreements after the Closing
Date; provided, however, that Buyer shall not succeed to or assume, and Seller
shall be responsible for, any liability or obligation arising out of any or all
of the following: (i) any breach by Seller of any such Contract or Personal
Property lease or agreement or any failure by Seller to discharge or perform any
liability or obligation arising on or prior to the Closing Date under any such
Contract or Personal Property lease or agreement, (ii) any Claim based on
products sold or services rendered by the Business on or prior to the Closing
Date, (iii) any Claim resulting from any act or omission of Seller on or prior
to the Closing Date, and (iv) the Excluded Assets, including but not limited to,
the Excluded Contracts.

        This Assignment and Assumption Agreement is being delivered in
connection with the Agreement and is subject to, and is entitled to the benefits
in respect of, the Agreement.

        This Assignment and Assumption Agreement shall be binding upon and inure
to the benefit of Buyer and Seller and their respective successors and assigns.

        This Assignment and Assumption Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which shall
constitute one agreement.

        IN WITNESS WHEREOF, the parties have caused their duly authorized
representatives to execute this Assignment and Assumption Agreement as of the
date first written above.


                                      -45-
<PAGE>   51


                                      INTERNATIONAL ISOTOPES INC.


                                      By________________________________________

                                      Title_____________________________________



                                      NEORX CORPORATION



                                      By________________________________________

                                      Title_____________________________________


                                      -46-
<PAGE>   52


                                                                     Exhibit 3.1
                                                     to Asset Purchase Agreement



THE SECURITIES EVIDENCED BY THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE OR FOREIGN SECURITIES
LAWS, AND NO INTEREST MAY BE SOLD, DISTRIBUTED, ASSIGNED, OFFERED, PLEDGED OR
OTHERWISE TRANSFERRED UNLESS (A) THERE IS AN EFFECTIVE REGISTRATION STATEMENT
UNDER SUCH ACT AND APPLICABLE STATE OR FOREIGN SECURITIES LAWS COVERING ANY SUCH
TRANSACTION INVOLVING SAID SECURITIES, (B) THE COMPANY RECEIVES AN OPINION OF
LEGAL COUNSEL FOR THE HOLDER OF THE SECURITIES SATISFACTORY TO THE COMPANY
STATING THAT SUCH TRANSACTION IS EXEMPT FROM REGISTRATION, (C) SUCH TRANSACTION
IS IN COMPLIANCE WITH RULE 144 OF THE ACT, OR (D) THE COMPANY OTHERWISE
SATISFIES ITSELF THAT SUCH TRANSACTION IS EXEMPT FROM REGISTRATION.

No. W-1
Issued:  March  ___, 2001                       Warrant to Purchase Common Stock
Void After March ___, 2004


                                NEORX CORPORATION

                                     WARRANT

        THIS IS TO CERTIFY that, for value received and subject to the terms and
conditions hereinafter set forth, International Isotopes Inc., a Texas
corporation, or such person to whom this Warrant is transferred (the "HOLDER"),
is entitled to exercise this Warrant to purchase from NeoRx Corporation, a
Washington corporation (the "COMPANY"), 800,000 fully paid and nonassessable
shares of common stock of the Company, par value $.02 per share (the "WARRANT
SHARES"), at a price per share of $10.00 (the "EXERCISE PRICE") (such number of
shares, type of security and the Exercise Price being subject to adjustment as
provided below).

1.      CASH EXERCISE

        1.1 OPTIONAL EXERCISE

        This Warrant may be exercised by the Holder, at any time until March
___, 2004 (the "EXERCISE PERIOD"), in whole or in part, by delivering to the
Company at 410 West Harrison Street, Seattle, WA 98119 (or such other office or
agency of the Company as it may designate by notice in writing to the Holder at
the address of the Holder appearing on the books of the Company) (a) this
Warrant certificate, (b) a certified or cashier's check payable to the Company
or a wire transfer in the amount of the Exercise Price multiplied by the number
of shares for which this Warrant is being


                                      -47-
<PAGE>   53

exercised (the "PURCHASE PRICE"), and (c) the Notice of Cash Exercise attached
as EXHIBIT A duly completed and executed by the Holder.

        1.2 COMPANY CALL

        (a) Notwithstanding the provisions of Section 1.1, if at any time during
the Exercise Period the Closing Price, as defined below, equals or exceeds
$20.00 per share, the Company at any time thereafter shall have the right to
acquire all or any portion of the Warrant Shares issuable upon exercise of this
Warrant at a purchase price equal to $.01 per share (the "CALL PURCHASE PRICE")
(such right to acquire the Warrant Shares referred to as the "COMPANY CALL").
The Company will notify the Holder of its election to exercise the Company Call
(the "CALL NOTICE"), which Call Notice will contain the Company's notice of
election to purchase the Warrant Shares subject to the Company Call and the date
on or after which the Company may consummate the purchase and sale (the
"CANCELLATION DATE"). The Call Notice, if issued, shall be issued not less than
fifteen (15) days before the Cancellation Date. Delivery of the Call Notice
shall not obligate the Company to consummate a purchase and sale of the Warrant
Shares on any specific date, if at all.

        "CLOSING PRICE" shall mean, with respect to the Common Stock, the
following: (a) if the Common Stock is traded on an exchange or is quoted on the
Nasdaq National Market (the "NASDAQ NATIONAL MARKET"), the average of the
closing or last sale prices reported for the twenty (20) business days
immediately preceding the date of calculation of such Closing Price, or (b) if
the Common Stock is not traded on an exchange or quoted on the Nasdaq National
Market, but is traded in the over-the-counter market, the average of the closing
bid and asked prices reported for the twenty (20) business days immediately
preceding the date of calculation of such Closing Price.

        (b) Upon the consummation of a purchase and sale pursuant to Section
1.2(a) hereof:

               (i)    the Company will cancel the Warrant and will duly reflect
                      such cancellation on the books and in the records of the
                      Company; and

               (ii)   the Company will deliver to the Holder an amount in cash
                      equal to the Call Purchase Price times the number of
                      Warrant Shares purchased in the Company Call.

2.      DELIVERY OF STOCK CERTIFICATES; NO FRACTIONAL SHARES

        2.1 Within ten (10) business days after the payment of the Purchase
Price following the exercise of this Warrant (in whole or in part), the Company
at its expense shall issue in the name of and deliver to the Holder (a) a
certificate or certificates for the number of fully paid and nonassessable
Warrant Shares to which the Holder shall be entitled upon such exercise, and (b)
a new Warrant of like tenor to purchase up to that number of Warrant Shares, if
any, as to which this Warrant has not been exercised if this Warrant has not
expired. The Holder shall for all purposes be deemed to have become the holder
of record of such Warrant Shares on the date this Warrant was exercised (the
date the Holder has fully complied with the requirements of Section 1.1 or 1.2),
irrespective of the date of delivery of the certificate or certificates
representing the Warrant Shares; provided that, if the date such exercise is
made is a date when the stock transfer books of the Company are closed, such
person shall be deemed to have become the holder of record of such


                                      -48-
<PAGE>   54

Warrant Shares at the close of business on the next succeeding date on which the
stock transfer books are open.

        2.2 No fractional shares shall be issued upon the exercise of this
Warrant. In lieu of fractional shares, the Company shall pay the Holder a sum in
cash equal to the Daily Price (as defined below) of the fractional share on the
date of exercise.

        "DAILY PRICE" of a Warrant Share shall mean:

        (a) If the Company's Common Stock is listed and traded on an exchange or
is quoted on the Nasdaq National Market, the closing or last sale price on such
day;

        (b) If the Company's Common Stock is not traded on and exchange or
quoted on the Nasdaq National Market, but is traded in the over-the-counter
market, the average of the closing bid and asked prices reported on such day;
and

        (c) If none of the above is applicable, the Daily Price shall be the
fair market value of the Common Stock as determined in good faith by the
Company's Board of Directors.

3.      ADJUSTMENTS UPON CERTAIN EVENTS

        3.1 EFFECT OF REORGANIZATION

            (a) REORGANIZATION--NO CHANGE OF CONTROL

        Upon a merger, consolidation, acquisition of all or substantially all of
the property or securities, liquidation or other reorganization of the Company
(collectively, a "REORGANIZATION") during the Exercise Period, as a result of
which the shareholders of the Company receive cash, securities or other property
in exchange for their shares of Common Stock and the holders of the Company's
voting equity securities immediately prior to such Reorganization together own a
majority interest of the voting equity securities of the successor corporation
following such Reorganization, lawful provision shall be made so that the Holder
shall thereafter be entitled to receive, upon exercise of this Warrant, the
number and type of securities of the successor corporation resulting from such
Reorganization (and cash and other property), to which a holder of the Warrant
Shares issuable upon exercise of this Warrant would have been entitled in such
Reorganization if this Warrant had been exercised immediately prior to such
Reorganization. In any such case, appropriate adjustment (as determined in good
faith by the Company's Board of Directors) shall be made in the application of
the provisions of this Warrant with respect to the rights and interest of the
Holder after the Reorganization to the end that the provisions of this Warrant
(including adjustments of the Exercise Price and the number and type of
securities purchasable and cash and other property deliverable pursuant to the
terms of this Warrant) shall be applicable after that event, as near as
reasonably may be, in relation to any securities, cash or other property
deliverable after that event upon the exercise of this Warrant.

            (b) REORGANIZATION--CHANGE OF CONTROL; TERMINATION OF WARRANT

        Upon a Reorganization prior to or during the Exercise Period, as a
result of which the shareholders of the Company receive cash, securities or
other property in exchange for their shares of Common Stock and the holders of
the Company's voting equity securities immediately prior to such


                                      -49-
<PAGE>   55

Reorganization together own less than a majority interest of the voting equity
securities of any successor corporation following such Reorganization, the
Holder shall be given notice at least ten (10) days prior to the effectiveness
thereof. Notwithstanding any other provision hereof, this Warrant shall become
immediately exercisable in full upon such notice to the Holder, subject to the
effectiveness of the Reorganization, provided, however, that such acceleration
of exercisability will not occur if, in the opinion of the Company's outside
accountants, such acceleration would render unavailable "pooling of interests"
accounting treatment for any Reorganization for which pooling of interests
accounting treatment is sought by the Company (in which event, lawful provision
shall be made so that the Holder shall thereafter be entitled to receive, upon
exercise of this Warrant during the remainder of the Exercise Period, the number
and type of securities of the successor corporation resulting from such
Reorganization (and cash and other property) to which a holder of the Warrant
Stock issuable upon exercise of this Warrant would have been entitled in such
Reorganization if this Warrant had been exercised immediately prior to such
Reorganization). The Holder shall have five (5) days from the receipt of such
notice to give notice to the Company whether it intends to conditionally
exercise this Warrant, in whole or in part. Notwithstanding any other provision
hereof, this Warrant shall become forever null and void to the extent not
conditionally exercised on or before 5:00 p.m., Pacific time, on the fifth day
following the receipt by the Holder of notice of the proposed Reorganization
(unless the acceleration of exercisability is denied by the Company in order to
preserve "pooling of interests" accounting treatment as set forth above).

        3.2 ADJUSTMENTS FOR STOCK SPLITS, DIVIDENDS

        If the Company shall issue any shares of the same class as the Warrant
Stock as a stock dividend or subdivide the number of outstanding shares of the
same class as the Warrant Shares into a greater number of shares, then, in
either such case, the Exercise Price in effect before such dividend or
subdivision shall be proportionately reduced and the number of Warrant Shares at
that time issuable pursuant to the exercise of this Warrant shall be
proportionately increased; and, conversely, if the Company shall contract the
number of outstanding shares of the same class as the Warrant Shares by
combining such shares into a smaller number of shares, then the Exercise Price
in effect before such combination shall be proportionately increased and the
number of Warrant Shares at that time issuable pursuant to the exercise or
conversion of this Warrant shall be proportionately decreased. Each adjustment
in the number of Warrant Shares issuable shall be to the nearest whole share.

        3.3 CERTIFICATE AS TO ADJUSTMENTS

        In the case of any adjustment in the Exercise Price or number and type
of securities issuable and cash or other property deliverable upon exercise of
this Warrant, the Company will promptly give written notice to the Holder in the
form of a certificate, certified and confirmed by an officer of the Company,
setting forth the adjustment in reasonable detail.

4.      SECURITIES LAWS RESTRICTIONS; LEGEND ON WARRANT SHARES

        4.1 This Warrant and, subject to satisfaction of Section 7.2, the
securities issuable upon exercise of this Warrant, have not been registered
under the Securities Act of 1933, as amended (the "SECURITIES ACT") or
applicable state securities laws, and no interest may be sold, distributed,
assigned, offered, pledged or otherwise transferred to any entity other than a
subsidiary of the Holder unless (a) there is an effective registration statement
under the Securities Act and applicable state


                                      -50-
<PAGE>   56


securities laws covering any such transaction involving said securities, (b) the
Company receives an opinion of legal counsel for the Holder satisfactory to the
Company stating that such transaction is exempt from registration, (c) such
transaction is in compliance with Rule 144A or Rule 144 of the Securities Act,
or (d) the Company otherwise satisfies itself that such transaction is exempt
from registration.

        4.2 A legend setting forth or referring to the above restrictions shall
be placed on this Warrant, any replacement and any certificate representing the
Warrant Shares, and a stop transfer order shall be placed on the books of the
Company and with any transfer agent until such securities may be legally sold or
otherwise transferred.

5.      EXCHANGE OF WARRANT; LOST OR DAMAGED WARRANT CERTIFICATE

        This Warrant is exchangeable upon its surrender by the Holder at the
office of the Company. Upon receipt by the Company of satisfactory evidence of
the loss, theft, destruction or damage of this Warrant and either (in the case
of loss, theft or destruction) reasonable indemnification or (in the case of
damage) the surrender of this Warrant for cancellation, the Company will execute
and deliver to the Holder, without charge, a new Warrant of like denomination.

6.      REPRESENTATIONS AND WARRANTIES OF THE HOLDER AND THE COMPANY

        The Holder hereby represents and warrants to the Company as follows:

        (a) The Holder is an accredited investor as defined in Rule 501(a) of
Regulation D promulgated under the Securities Act.

        (b) The Holder is aware of the Company's business affairs and financial
condition and has acquired sufficient information about the Company to reach an
informed and knowledgeable decision to acquire this Warrant and the Warrant
Shares. The Holder is acquiring this Warrant and the Warrant Shares issuable
upon exercise hereof for its own account and not with a view to or for sale in
connection with any distribution thereof in violation of the Securities Act and
the General Rules and Regulations promulgated thereunder. The Holder shall not
make any sale, transfer or other disposition of this Warrant or any Warrant
Shares issuable upon exercise thereof in violation of the Securities Act by the
U.S. Securities and Exchange Commission (the "COMMISSION") or in violation of
any applicable state or foreign securities law.

        (c) The Holder has been advised that this Warrant, and the Warrant
Shares issuable upon exercise hereof, have not been registered under the
Securities Act or state or foreign securities laws in reliance upon an exemption
from registration, and that reliance by the Company on such exemptions is
predicated in part on Holder's representations set forth herein.

        (d) The Holder has been informed that under the Securities Act, this
Warrant and the Warrant Shares issuable upon conversion hereof must be held
indefinitely unless subsequently registered under the Securities Act or unless
an exemption from such registration (such as Rule 144) is available with respect
to any proposed transfer or disposition by the Holder. The Holder further agrees
that the Company may refuse to permit the Holder to sell, transfer or dispose of
this Warrant, and the Warrant Shares issuable upon conversion hereof (except as
permitted under Rule 144), unless there is in effect a registration statement
under the Securities Act and any applicable state or


                                      -51-
<PAGE>   57

foreign securities laws covering such transfer, or unless the Holder furnishes
an opinion of counsel reasonably satisfactory to counsel for the Company, to the
effect that such registration is not required.

        The Company hereby represents and warrants to the Holder that this
Warrant, when issued, sold and delivered in accordance with the terms of the
Agreement and the Transaction Documents (as those terms are defined in the Asset
Purchase Agreement between NeoRx Corporation and International Isotopes Inc.
dated as of March 20, 2001) will be duly and validly issued, fully paid, and
nonassessable, and will be free of restrictions on transfer, other than
restrictions on transfer arising (a) under federal and state securities law, (b)
not by or through the Company, or (c) by agreement between the Company and the
Holder or its successors..

7.      COVENANTS AS TO WARRANT SHARES

        7.1 RESERVATION OF SHARES

        The Company covenants that at all times during the Exercise Period there
shall be reserved for issuance and delivery upon exercise of this Warrant such
number of Warrant Shares as is necessary for exercise in full of this Warrant
and, from time to time, it will take all steps necessary to provide sufficient
reserves of Warrant Shares. All shares of Warrant Stock issued pursuant to the
exercise of this Warrant will, upon their issuance, be validly issued, fully
paid and nonassessable, free and clear of all liens and other encumbrances or
restrictions on sale and free and clear of all preemptive rights, except
restriction arising (a) under federal and state securities law, (b) not by or
through the Company, or (c) by agreement between the Company and the Holder or
its successors.

        7.2 REGISTRATION OF WARRANT SHARES

        The Company agrees:

               (a)    to use its best efforts to as soon as practicable, but not
                      more than ten (10) business days after the later of (i)
                      receipt and acceptance by the Company of EXHIBIT C,
                      properly completed and executed, reflecting the assignment
                      of the Warrant, or portions thereof, to the preferred
                      shareholders of International Isotopes Inc. (the"I3
                      PREFERRED SHAREHOLDERS") or (ii) receipt and acceptance by
                      the Company of EXHIBITS B AND D, properly completed and
                      executed, from individual I3 Preferred Shareholders in the
                      aggregate constituting at least 85% of the total number of
                      I3 Preferred Shareholders, to prepare and file with the
                      Commission a registration statement (the "REGISTRATION
                      STATEMENT") relating to the sale of the Warrant Shares by
                      the Holder from time to time on the Nasdaq National Market
                      (or the facilities of any national securities exchange on
                      which the Company's Common Stock is then traded) or in
                      privately negotiated transactions;

               (b)    to use its best efforts, subject to receipt of necessary
                      information from the Holder, to cause the Commission to
                      notify the Company of the Commission's willingness to
                      declare the Registration Statement effective within ninety
                      (90) days after the Registration Statement is filed with
                      the Commission;


                                      -52-
<PAGE>   58


               (c)    to use its best efforts to prepare and file with the
                      Commission such amendments and supplements to the
                      Registration Statement and the Prospectus filed as part
                      thereof and take such other action, if any, as may be
                      necessary to keep the Registration Statement effective
                      until the earlier of (i) two years after the effective
                      date of the Registration Statement, (ii) the date on which
                      the Warrant Shares may be resold by the Holder without
                      registration or without regard to any volume limitations
                      by reason of Rule 144 under the Securities Act or any
                      other rule of similar effect, or (iii) all of the Warrant
                      Shares have been sold pursuant to the Registration
                      Statement or Rule 144 under the Securities Act or any
                      other rule of similar effect;

               (d)    to furnish to the Holder with respect to the Warrant
                      Shares registered under the Registration Statement such
                      reasonable number of copies of the Prospectus, including
                      any supplements to or amendments of the Prospectus, in
                      order to facilitate the public sale or other disposition
                      of all or any of the Warrant Shares by the Holder;
                      provided however, that the obligation of the Company to
                      deliver copies of the Prospectus to the Purchaser shall be
                      subject to the receipt by the Company of reasonable
                      assurances from the Holder that the Holder will comply
                      with the applicable provisions of the Securities Act and
                      of such other securities or blue sky laws as may be
                      applicable in connection with any use of the Prospectus;

               (e)    during the period when copies of the Prospectus are
                      required to be delivered under the Securities Act or the
                      Securities Exchange Act of 1934, as amended (the "EXCHANGE
                      ACT"), to file all documents required to be filed with the
                      Commission pursuant to Section 13, 14 or 15 of the
                      Exchange Act within the time periods required by the
                      Exchange Act and the rules and regulations promulgated
                      thereunder;

               (f)    to use its best efforts to file documents required of the
                      Company for customary Blue Sky clearance in states
                      specified in writing by the Holder; provided, however,
                      that the Company shall not be required to qualify to do
                      business or consent to service of process in any
                      jurisdiction in which it is not now so qualified or has
                      not so consented, and to file the documents necessary to
                      list the Warrant Shares on the Nasdaq Stock Market;

               (g)    to bear all expenses in connection with the procedures in
                      paragraphs (a) through (f) of this Section 7.2 and the
                      registration of the Warrant Shares pursuant to the
                      Registration Statement, other than any fees and expenses
                      of counsel or other advisers to the Holder, brokerage fees
                      and commissions incurred by the Holder;

               (h)    to comply with the provisions of the Securities Act with
                      respect to the disposition of all Warrant Shares covered
                      by the Registration Statement in accordance with the
                      intended methods of distribution by the Holder as set
                      forth in the Registration Statement;


                                      -53-
<PAGE>   59

               (i)    to notify the Holder, if the Holder has registered Warrant
                      Shares in the Registration Statement which remain unsold,
                      (i) when a prospectus or any prospectus supplement or
                      post-effective amendment has been filed, and, with respect
                      to the Registration Statement or any post-effective
                      amendment, when the same has become effective, (ii) of any
                      request by the Commission or any other federal or state
                      governmental authority during the period of effectiveness
                      of the Registration Statement for amendments or
                      supplements to the Registration Statement or related
                      prospectus or for additional information relating to the
                      Registration Statement, (iii) of the issuance by the
                      Commission or any other federal or state governmental
                      authority of any stop order suspending the effectiveness
                      of the Registration Statement or the initiation of any
                      proceedings for that purpose, (iv) of the receipt by the
                      Company of any notification with respect to the suspension
                      of the qualification or exemption from qualification of
                      any of the Warrant Shares for sale in any jurisdiction or
                      the initiation of any proceeding for such purpose, (v) of
                      the happening of any event which makes any statement made
                      in the Registration Statement or related prospectus or any
                      document incorporated or deemed to be incorporated therein
                      by reference untrue in any material respect or which
                      requires the making of any changes in the Registration
                      Statement or prospectus so that, in the case of the
                      Registration Statement, it will not contain any untrue
                      statement of a material fact or omit to state any material
                      fact required to be stated therein or under which such
                      statement was made, not misleading, and (vi) of the
                      Company's reasonable determination that a post-effective
                      amendment to the Registration Statement would be
                      appropriate;

               (j)    to use commercially reasonable efforts to obtain the
                      withdrawal of any order suspending the effectiveness of
                      the Registration Statement, or the lifting of any
                      suspension of the qualification (or exemption from
                      qualification) of any of the Warrant Shares for sale in
                      any jurisdiction; and

               (k)    upon the occurrence of any event contemplated by Section
                      7.2(i)(v) or 7.2(i)(vi) above, to prepare a supplement or
                      post-effective amendment to the Registration Statement or
                      a supplement to the related prospectus or any document
                      incorporated therein by reference or file any other
                      required document so that, as thereafter delivered to the
                      purchasers of the Warrant Shares being sold thereunder,
                      such prospectus will not contain an untrue statement of
                      material fact or omit to state a material fact required to
                      be stated therein or necessary to make the statements
                      therein, in light of the circumstances under which they
                      were made, not misleading.

        7.3 RESALE OF WARRANT SHARES

        (a) The Holder hereby covenants with the Company not to make any sale of
the Warrant Shares without satisfying the requirements of the Securities Act and
the Rules and Regulations promulgated thereunder, including, in the event of any
resale under the Registration Statement, the prospectus delivery requirements
under the Securities Act, and the Holder acknowledges and agrees that such
Warrant Shares are not transferable on the books of the Company pursuant to a
resale under


                                      -54-
<PAGE>   60

the Registration Statement unless the certificate submitted to the transfer
agent evidencing the Warrant Shares is accompanied by a separate certificate in
the form acceptable to the Company to the effect that (i) the Warrant Shares
have been sold in accordance with the Registration Statement and (ii) the
requirement of delivering a current prospectus has been satisfied.

        (b) The Holder acknowledges that there may occasionally be times when
the Company determines the use of the Prospectus forming a part of the
Registration Statement should be suspended until such time as an amendment or
supplement to the Registration Statement or the Prospectus has been filed by the
Company and any such amendment to the Registration Statement is declared
effective by the Commission, or until such time as the Company has filed an
appropriate report with the Commission pursuant to the Exchange Act. The Holder
hereby covenants that it will not sell any Warrant Shares pursuant to the
Prospectus during the period commencing at the time at which the Company gives
the Holder written notice of the suspension of the use of the Prospectus and
ending at the time the Company gives the Holder written notice that the Holder
may thereafter effect sales pursuant to the Prospectus. The Company may, upon
written notice to the Holder, suspend the use of the Prospectus for two 60-day
periods in any 365-day period based on the reasonable determination of the
Company's Board of Directors that there is a significant business purpose for
such determination, such as pending corporate developments, public filings with
the Commission or similar events. The Company shall in no event be required to
disclose the business purpose for which it has suspended the use of the
Prospectus if the Company determines in its good faith judgment that the
business purpose should remain confidential.

        (c) The Holder further covenants to notify the Company promptly of the
sale of any of its Warrant Shares.

8.      INDEMNIFICATION

        (a) The Company agrees to indemnify and hold harmless the Holder and
each person, if any, who controls the Holder within the meaning of the
Securities Act, against any losses, claims, damages, liabilities or expenses,
joint or several, to which the Holder or such controlling person may become
subject, under the Securities Act, the Exchange Act, or any other federal or
state statutory law or regulation, or at common law or otherwise (including in
settlement of any litigation, if such settlement is effected with the written
consent of the Company, which consent shall not be unreasonably withheld),
insofar as such losses, claims, damages, liabilities or expenses (or actions in
respect thereof as contemplated below) arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact contained in the
Registration Statement, including the Prospectus, financial statements and
schedules, and all other documents filed as a part thereof, as amended at the
time of effectiveness of the Registration Statement, including any information
deemed to be a part thereof as of the time of effectiveness pursuant to
paragraph (b) of Rule 430A or pursuant to Rule 434 under the Securities Act, or
the Prospectus, in the form first filed with the Commission pursuant to Rule
424(b) of the under the Securities Act, or filed as part of the Registration
Statement at the time of effectiveness if no Rule 424(b) filing is required (the
"PROSPECTUS"), or any amendment or supplement thereto, or arise out of or are
based upon the omission or alleged omission to state in any of them a material
fact required to be stated therein or necessary to make the statements in any of
them, in light of the circumstances under which they were made, not misleading,
or arise out of or are based in whole or in part on any inaccuracy in the
representations and warranties of the Company contained in this Warrant, or any
failure of the Company to perform its obligations under this Warrant or under
law, and will reimburse the Holder


                                      -55-
<PAGE>   61

and each such controlling person for any legal and other expenses as such
expenses are reasonably incurred by the Holder or such controlling person in
connection with investigating, defending, settling, compromising or paying any
such loss, claim, damage, liability, expense or action; provided, however, that
the Company will not be liable in any such case to the extent that any such
loss, claim, damage, liability or expense arises out of or is based upon (i) an
untrue statement or alleged untrue statement or omission or alleged omission
made in the Registration Statement, the Prospectus or any amendment or
supplement of the Registration Statement or Prospectus in reliance upon and in
conformity with written information furnished to the Holder by or on behalf of
the Holder expressly for use in the Registration Statement or the Prospectus, or
(ii) the failure of the Holder to comply with the covenants and agreements
contained in Sections 6 and 7 of this Warrant respecting resale of the Shares,
or (iii) the inaccuracy of any representations made by the Holder in this
Warrant or (iv) any untrue statement or omission of a material fact required to
make such statement not misleading in any Prospectus that is corrected in any
subsequent Prospectus that was delivered to the Holder before the pertinent sale
or sales by the Holder.

        (b) The Holder will indemnify and hold harmless the Company, each of its
directors, each of its officers who signed the Registration Statement and each
person, if any, who controls the Company within the meaning of the Securities
Act, against any losses, claims, damages, liabilities or expenses to which the
Company, each of its directors, each of its officers who signed the Registration
Statement or controlling person may become subject, under the Securities Act,
the Exchange Act, or any other federal or state statutory law or regulation, or
at common law or otherwise (including in settlement of any litigation, if such
settlement is effected with the written consent of the Holder, which consent
shall not be unreasonably withheld) insofar as such losses, claims, damages,
liabilities or expenses (or actions in respect thereof as contemplated below)
arise out of or are based upon (i) any failure to comply with the covenants and
agreements contained in Sections 7.2 of this Warrant respecting the sale of the
Warrant Shares or (ii) the inaccuracy of any representation made by the Holder
in this Warrant or (iii) any untrue or alleged untrue statement of any material
fact contained in the Registration Statement, the Prospectus, or any amendment
or supplement to the Registration Statement or Prospectus, or arise out of or
are based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was made
in the Registration Statement, the Prospectus, or any amendment or supplement
thereto, in reliance upon and in conformity with written information furnished
to the Company by or on behalf of the Holder expressly for use therein, and the
Holder will reimburse the Company, each of its directors, each of its officers
who signed the Registration Statement or controlling person for any legal and
other expense reasonably incurred by the Company, each of its directors, each of
its officers who signed the Registration Statement or controlling person in
connection with investigating, defending, settling, compromising or paying any
such loss, claim, damage, liability, expense or action.

        (c) Promptly after receipt by an indemnified party under this Section 8
of notice of the threat or commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against an indemnifying party
under this Section 8, promptly notify the indemnifying party in writing of the
claim; but the omission so to notify the indemnifying party will not relieve it
from any liability which it may have to any indemnified party for contribution
or otherwise than under the indemnity agreement contained in this Section 8 or
to the extent it is not prejudiced as a result of such failure.


                                      -56-
<PAGE>   62

        (d) In case any such action is brought against any indemnified party and
such indemnified party seeks or intends to seek indemnity from an indemnifying
party, the indemnifying party will be entitled to participate in, and, to the
extent that it may wish, jointly with all other indemnifying parties similarly
notified, to assume the defense thereof with counsel reasonably satisfactory to
such indemnified party; provided, however, if the defendants in any such action
include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be a conflict
between the positions of the indemnifying party and the indemnified party in
conducting the defense of any such action or that there may be legal defenses
available to it or other indemnified parties that are different from or
additional to those available to the indemnifying party, the indemnified party
or parties shall have the right to select separate counsel to assume such legal
defenses and to otherwise participate in the defense of such action on behalf of
such indemnified party or parties. Upon receipt of notice from the indemnifying
party to such indemnified party of its election so to assume the defense of such
action and approval by the indemnified party of counsel, the indemnifying party
will not be liable to such indemnified party under this Section 8 for any legal
or other expenses subsequently incurred by such indemnified party in connection
with the defense thereof unless:

               (i)    the indemnified party shall have employed such counsel in
                      connection with the assumption of legal defenses in
                      accordance with the proviso to the preceding sentence (it
                      being understood, however, that the indemnifying party
                      shall not be liable for the expenses of more than one
                      separate counsel, approved by such indemnifying party in
                      the case of Section 8(c), representing all of the
                      indemnified parties who are parties to such action), or

               (ii)   the indemnifying party shall not have employed counsel
                      reasonably satisfactory to the indemnified party to
                      represent the indemnified party within a reasonable time
                      after notice of commencement of action, in each of which
                      cases the reasonable fees and expenses of counsel shall be
                      at the expense of the indemnifying party.

        (e) If the indemnification provided for in this Section 8 is required by
its terms but is for any reason held to be unavailable to or otherwise
insufficient to hold harmless an indemnified party under this Section 8 in
respect to any losses, claims, damages, liabilities or expenses referred to in
this Agreement, then each applicable indemnifying party shall contribute to the
amount paid or payable by such indemnified party as a result of any losses,
claims, damages, liabilities or expenses referred to in this Agreement

               (i)    in such proportion as is appropriate to reflect the
                      relative benefits received by the Company and the Holder
                      from the placement of the Warrant Shares or

               (ii)   if the allocation provided by clause (e)(i) above is not
                      permitted by applicable law, in such proportion as is
                      appropriate to reflect not only the relative benefits
                      referred to in clause (e)(i) above but the relative fault
                      of the Company and the Holder in connection with the
                      statements or omissions or inaccuracies in the
                      representations and warranties in this Warrant resulted in
                      such losses, claims, damages, liabilities or expenses, as
                      well as any other relevant equitable considerations.


                                      -57-
<PAGE>   63

        The respective relative benefits received by the Company on the one hand
and the Holder on the other shall be deemed to be in the same proportion as the
amount paid by the Holder to the Company pursuant to this Warrant for the
Warrant Shares purchased by the Holder that were sold pursuant to the
Registration Statement bears to the difference (the "DIFFERENCE") between the
amount the Holder paid for the Shares that were sold pursuant to the
Registration Statement and the amount received by the Holder from such sale. The
relative fault of the Company and the Holder shall be determined by reference
to, among other things, whether the untrue or alleged statement of a material
fact or the omission or alleged omission to state a material fact or the
inaccurate or the alleged inaccurate representation or warranty relates to
information supplied by the Company or by the Holder and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The amount paid or payable by a party as a result of
the losses, claims, damages, liabilities and expenses referred to above shall be
deemed to include, subject to the limitations set forth in Sections 8(c) and
(d), any legal or other fees or expenses reasonably incurred by such party in
connection with investigating or defending any action or claim. The provisions
set forth in Sections 8(c) and (d) with respect to the notice of the threat or
commencement of any threat or action shall apply if a claim for contribution is
to be made under this Section 8(e); provided, however, that no additional notice
shall be required with respect to any threat or action for which notice has been
given under Section 8 for purposes of indemnification. The Company and the
Holder agree that it would not be just and equitable if contribution pursuant to
this Section 8 were determined solely by pro rata allocation or by any other
method of allocation which does not take account of the equitable considerations
referred to in this paragraph. Notwithstanding the provisions of this Section 8,
the Holder shall not be required to contribute any amount in excess of the
amount by which the Difference exceeds the amount of any damages that the Holder
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.

        (f) For the purpose of this Section 8, the term "Registration Statement"
shall include any preliminary or final prospectus, exhibit, supplement or
amendment included in or relating to the Registration Statement referred to in
Section 8(a) above.

9.      MISCELLANEOUS

        9.1 HOLDER AS OWNER

        The Company may deem and treat the holder of record of this Warrant as
the absolute owner for all purposes regardless of any notice to the contrary.

        9.2 NO SHAREHOLDER RIGHTS

        This Warrant shall not entitle the Holder to any voting rights or any
other rights as a shareholder of the Company or to any other rights except the
rights stated herein; and no dividend or interest shall be payable or shall
accrue in respect of this Warrant or the Warrant Shares, until this Warrant is
exercised.

        9.3 NOTICES


                                      -58-
<PAGE>   64

        Unless otherwise provided, any notice under this Warrant shall be given
in writing and shall be deemed effectively given (a) upon personal delivery to
the party to be notified, (b) upon confirmation of receipt by fax by the party
to be notified, (c) two business days after deposit with a reputable overnight
courier, prepaid for overnight delivery and addressed as set forth in (d), or
(d) five days after deposit with the United States Post Office or any foreign
postal service, postage prepaid, registered or certified with return receipt
requested and addressed to the party to be notified at the address indicated
below, or at such other address as such party may designate by ten (10) days'
advance written notice to the other party given in the foregoing manner.


       If to the Holder:           To the address last furnished
                                   in writing to the Company by
                                   the Holder

       If to the Company:          NeoRx Corporation
                                   410 West Harrison Street
                                   Seattle, WA  98119
                                   Attn:  Chief  Financial Officer
                                   Telephone: (206) 281-7001
                                   Facsimile:  (206) 298-9442

        9.4 AMENDMENTS AND WAIVERS

        Any term of this Warrant may be amended and the observance of any term
may be waived (either generally or in a particular instance and either
retroactively or prospectively) only with the written consent of the Company and
the Holder. Any amendment or waiver effected in accordance with this Section 9.4
shall be binding on each future Holder and the Company.

        9.5 GOVERNING LAW

        This Warrant shall be governed by and construed under the laws of the
state of Washington without regard to principles of conflict of laws. The
parties irrevocably consent to the jurisdiction and venue of the state and
federal courts located in King County, Washington in connection with any action
relating to this Warrant.

        9.6 SUCCESSORS AND ASSIGNS; TRANSFER

        The terms and conditions of this Warrant shall inure to the benefit of
and be binding on the respective successors and assigns of the parties. This
Warrant may not be transferred or assigned without the consent of the Company.
Notwithstanding Sections 4.1 and 6(d), upon delivery by I3 to the Company of (a)
an assignment for each I3 Preferred Shareholder in the form attached hereto as
EXHIBIT C, (b) a letter of each I3 Preferred Shareholder in the form attached
hereto as EXHIBIT D, (c) an EXHIBIT B properly completed by each I3 Preferred
Shareholder, (d) written certification by I3, in form satisfactory to the
Company, that I3 has complied, in both the offer and sale of the Warrants, with
all notice, filing and registration requirements of federal and state securities
laws as set forth in a Memorandum of Law satisfactory in form and substance to
the Company prepared by counsel


                                      -59-
<PAGE>   65


satisfactory to the Company, and (e) such other information as the Company shall
reasonably request, the Company shall consent to the transfer or assignment of
this Warrant to the I3 Preferred Shareholders.

10.     MODIFICATION; AMENDMENT

        This Warrant may not be modified or amended except pursuant to an
instrument in writing signed by the Company and the Holder.

11.     SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS.

        Notwithstanding any investigation made by the Holder or the Company, all
covenants, agreements, representations and warranties made by the Company and
the Holder in this Agreement and in the certificates for the Warrant Shares
delivered pursuant to this Warrant shall survive the execution of this Warrant,
the delivery to the Holder of the Warrant and the Warrant Shares and the payment
therefor.

12.     HEADINGS

        The headings of the various sections of this Warrant have been inserted
for convenience of reference only and shall not be deemed to be part of this
Warrant.

13.     ENTIRE AGREEMENT; COUNTERPARTS

        This Warrant constitutes the entire agreement between the parties about
its subject and supersedes all prior agreements.

        [Signature page follows.]


                                      -60-
<PAGE>   66

        IN WITNESS WHEREOF, the parties have executed this Warrant as of the
date first written above.

                                     NeoRx Corporation



                                     By:________________________________________
                                        Paul G. Abrams, Chief Executive Officer



ACCEPTED AND AGREED:

International Isotopes Inc.



By____________________________________
Its___________________________________


                                      -61-