<PAGE>
                                                                   EXHIBIT 10.22


[CONFIDENTIAL TREATMENT REQUESTED] /*/ INDICATES MATERIAL THAT HAS BEEN OMITTED
AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED
MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO
RULE 406 PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.

                                                                  EXECUTION COPY




             SUBSCRIPTION, JOINT DEVELOPMENT AND OPERATING AGREEMENT



                              ELAN CORPORATION, PLC
         (ACTING THROUGH ITS DIVISION ELAN PHARMACEUTICAL TECHNOLOGIES)


                        ELAN PHARMA INTERNATIONAL LIMITED


                        ELAN INTERNATIONAL SERVICES, LTD.


                                       AND


                                 ACUSPHERE, INC.



                                       AND


                              ACUSPHERE NEWCO, LTD.








<PAGE>

                                      INDEX

CLAUSE 1  DEFINITIONS

CLAUSE 2  BUSINESS AND SELECTION OF COMPOUNDS

CLAUSE 3  REPRESENTATIONS AND WARRANTIES

CLAUSE 4  AUTHORIZATION AND CLOSING

CLAUSE 5  DIRECTORS; MANAGEMENT AND R&D COMMITTEES

CLAUSE 6  THE BUSINESS PLAN AND REVIEWS

CLAUSE 7  RESEARCH AND DEVELOPMENT

CLAUSE 8  COMMERCIALIZATION

CLAUSE 9  OWNERSHIP OF INTELLECTUAL PROPERTY RIGHTS/NONCOMPETITION

CLAUSE 10 INTELLECTUAL PROPERTY RIGHTS

CLAUSE 11 CROSS LICENSING/EXPLOITATION OF PRODUCTS OUTSIDE FIELD

CLAUSE 12 REGULATORY

CLAUSE 13 MANUFACTURING

CLAUSE 14 TECHNICAL SERVICES AND ASSISTANCE

CLAUSE 15 AUDITORS, BANKERS, ACCOUNTING REFERENCE DATE; SECRETARY

CLAUSE 16 TRANSFER OF SHARES; RIGHTS OF FIRST OFFER; TAG ALONG RIGHTS

CLAUSE 17 MATTERS REQUIRING SHAREHOLDERS' APPROVAL

CLAUSE 18 DISPUTES

CLAUSE 19 TERMINATION

CLAUSE 20 SHARE RIGHTS



<PAGE>

CLAUSE 21 CONFIDENTIALITY

CLAUSE 22 COSTS

CLAUSE 23 GENERAL











<PAGE>




THIS SUBSCRIPTION, JOINT DEVELOPMENT AND OPERATING AGREEMENT made this 30th day
of June, 2000

BETWEEN:

(1)      ELAN CORPORATION, PLC, a public limited company incorporated under the
         laws of Ireland, acting through its division ELAN PHARMACEUTICAL
         TECHNOLOGIES, and having its registered office at Lincoln House,
         Lincoln Place, Dublin 2, Ireland ("ELAN, PLC");

(2)      ELAN INTERNATIONAL SERVICES, LTD., a Bermuda exempted limited liability
         company incorporated under the laws of Bermuda, and having its
         registered office at Clarendon House, 2 Church St., Hamilton, Bermuda
         ("EIS");

(3)      ELAN PHARMA INTERNATIONAL LIMITED a private limited company
         incorporated under the laws of Ireland, and having its registered
         office at WIL House, Shannon Business Park, Shannon, County Clare,
         Ireland ("EPIL");

(4)      ACUSPHERE, INC. a corporation duly incorporated and validly existing
         under the laws of Delaware and having its principal place of business
         at 38 Sidney Street, Cambridge, MA 02139 United States of America
         ("ACUSPHERE"); and

(5)      ACUSPHERE NEWCO LIMITED a Bermuda exempted limited liability company
         incorporated under the laws of Bermuda, and having its registered
         office at Clarendon House, 2 Church St., Hamilton, Bermuda ("NEWCO").

RECITALS:

A.       Newco desires to issue and sell to the Shareholders (as defined below),
         and the Shareholders desire to purchase from Newco, for aggregate
         consideration of $15,000,000, apportioned between them as set forth
         herein, (i) 6,000 shares of Newco's common shares, par value $1.00 per
         share (the "COMMON SHARES") to Acusphere, and (ii) 6,000 shares of
         Newco's preferred shares, par value $1.00 per share (the "PREFERRED
         SHARES") allocated 3,612 shares to Acusphere and 2,388 shares to EIS.

B.       As of the Closing Date, Elan, plc and EPIL, have entered into a license
         agreement with Newco, and Acusphere has entered into a license
         agreement with Newco, in connection with the license to Newco of the
         Elan Intellectual Property and the Acusphere Intellectual Property,
         respectively (each as defined below).

C.       Elan, plc, EPIL and Acusphere have agreed to co-operate in the
         research, development and commercialization of the Products (as defined
         below) based on their respective technologies.



                                       1

<PAGE>


D.       Elan, plc, EPIL and Acusphere have agreed to enter into this Agreement
         for the purpose of recording the terms and conditions regulating their
         relationship with each other, with respect to the Licensed Technologies
         and with Newco.


NOW IT IS HEREBY AGREED AS FOLLOWS:

                                    CLAUSE 1

                                   DEFINITIONS

1.1      In this Agreement, the following terms shall, where not inconsistent
         with the context, have the following meanings respectively.

         "ACUSPHERE DIRECTORS" has the meaning set forth in Clause 5.

         "ACUSPHERE IMPROVEMENTS" has the meaning assigned thereto in the
         Acusphere License Agreement.

         "ACUSPHERE INTELLECTUAL PROPERTY" has the meaning assigned thereto in
         the Acusphere License Agreement.

         "ACUSPHERE JV" shall mean an entity that Acusphere and a third party
         (i) establish or has established, (ii) take shareholdings in or have a
         right to take shareholdings in, and (iii) grant certain licenses in and
         to certain intellectual property rights for the purpose of implementing
         a strategic alliance.

         "ACUSPHERE KNOW-HOW" has the meaning assigned thereto in the Acusphere
         License Agreement.

         "ACUSPHERE LICENSE" has the meaning assigned thereto in the Acusphere
         License Agreement.

         "ACUSPHERE LICENSE AGREEMENT" shall mean the license agreement between
         Acusphere and Newco, of even date herewith, attached hereto in
         Schedule 2.

         "ACUSPHERE PATENTS" has the meaning assigned thereto in the Acusphere
         License Agreement.

         "ACUSPHERE SECURITIES PURCHASE AGREEMENT" shall mean that certain
         securities purchase agreement, of even date herewith, by and between
         Acusphere and EIS.


                                       2

<PAGE>

         "AFFILIATE" of any Person (in the case of a legal entity) shall mean
         any other Person controlling, controlled or under the common control of
         such first Person, as the case may be, excluding an Elan JV and an
         Acusphere JV. For the purposes of this definition, "control" shall mean
         direct or indirect ownership of [CONFIDENTIAL TREATMENT REQUESTED] /*/
         or more of the stock or shares entitled to vote for the election of
         directors and "controlling" and "controlled" shall be construed
         accordingly. For purposes of this Agreement, Newco is not an Affiliate
         of Elan or EIS.

         "AGREEMENT" shall mean this agreement (which expression shall be deemed
         to include the Recitals and the Schedules hereto).

         "BOARD" shall mean the board of directors of Newco.

         "BUSINESS" shall mean the business operated by Newco, as described in
         Clause 2.1 and as more fully specified in the Business Plan.

         "BUSINESS PLAN" shall have the meaning set forth in Clause 6 below.

         "CHARTER" shall mean the Amended and Restated Certificate of
         Incorporation of Acusphere, in the form attached as an Exhibit to the
         Securities Purchase Agreement.

         "CLOSING DATE" shall mean the date upon which the Definitive Documents
         are executed and delivered by the Parties and the transactions effected
         thereby are closed.

         "COMMERCIALIZATION" shall mean the manufacture, have manufactured,
         promotion, distribution, import, use, market, offer for sale and sale
         of the Products in accordance with the terms of this Agreement.

         "COMMON SHARE EQUIVALENTS" shall mean any options, warrants, rights or
         any other securities convertible, exercisable or exchangeable, in whole
         or in part, for or into Common Shares.

         "COMPOUNDS" shall mean [CONFIDENTIAL TREATMENT REQUESTED]/*/ and such
         other active ingredients for the Products as may be nominated by the
         Management Committee in accordance with Clause 2 below.

         "CONVERTIBLE NOTE" shall mean that certain convertible promissory note,
         of even date herewith, by and between Acusphere and EIS.

         "DEFINITIVE DOCUMENTS" shall mean this Agreement, the Elan License
         Agreement, the Acusphere License Agreement, the Convertible Note, the
         Acusphere Securities Purchase Agreement, the Investors Rights
         Agreements, the Charter and associated documentation of even date
         herewith, by and between Acusphere, Elan, EIS and Newco, as applicable.



                                       3

<PAGE>
         "DIRECTORS" shall mean, at any time, the directors of Newco.

         "EIS DIRECTOR" has the meaning set forth in Clause 5.

         "ELAN" shall mean Elan, plc and EPIL.

         "ELAN IMPROVEMENTS" has the meaning assigned thereto in the Elan
         License Agreement.

         "ELAN INTELLECTUAL PROPERTY" has the meaning assigned thereto in the
         Elan License Agreement.

         "ELAN JV" has the meaning assigned thereto in the Elan License
         Agreement.

         "ELAN KNOW-HOW" has the meaning assigned thereto in the Elan License
         Agreement.

         "ELAN LICENSE" has the meaning assigned thereto in the Elan License
         Agreement.

         "ELAN LICENSE AGREEMENT" shall mean the license agreement between Elan
         and Newco, of even date herewith, attached hereto in Schedule 1.

         "ELAN PATENTS" has the meaning assigned thereto in the Elan License
         Agreement.

         "ENCUMBRANCE" shall mean any liens, charges, encumbrances, equities,
         claims, options, proxies, pledges, security interests, or other similar
         rights of any nature.

         "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
         amended.

         "EXCHANGE AGREEMENT" shall mean the Exchange Agreement of even date
         herewith between EIS and Acusphere.

         "EXCHANGE RIGHT" has the meaning assigned to such term in the Exchange
         Agreement in effect on the Closing Date.

         "FDA" shall mean the United States Food and Drug Administration or any
         other successor agency in the USA.

         "FIELD" shall mean delivery of a specified Compound by a specific Mode
         of Administration in a specific device to treat a specific medical
         condition, as set


                                       4

<PAGE>

         forth in Clause 2.3 below with respect to [CONFIDENTIAL TREATMENT
         REQUESTED] /*/ and as further determined by the unanimous vote of the
         Management Committee in accordance with Clause 2 hereof.

         "FINANCIAL YEAR" shall mean each year commencing on January 1 (or in
         the case of the first Financial Year, the Closing Date) and expiring on
         December 31 of each year.

         "FULLY DILUTED COMMON SHARES" shall mean all of the issued and
         outstanding Common Shares, assuming the conversion, exercise or
         exchange of all outstanding Common Share Equivalents.

         "INVESTORS RIGHTS AGREEMENT" shall mean the Amended and Restated
         Investors Rights Agreement, of even date herewith, among Acusphere, EIS
         and other investors in Acusphere.

         "LICENSE AGREEMENTS" shall mean the Elan License Agreement and the
         Acusphere License Agreement.

         "LICENSED TECHNOLOGIES" shall mean, collectively, the Elan Intellectual
         Property and the Acusphere Intellectual Property.

         "LICENSES" shall mean the Elan License and the Acusphere License.

         "MANAGEMENT COMMITTEE" shall have the meaning set forth in Clause 5.2
         hereof.

         "MODE OF ADMINISTRATION" shall mean administration via the pulmonary
         route (a) for local or systemic effect and (b) by immediate or
         controlled release.

         "NEWCO INTELLECTUAL PROPERTY" shall mean all rights to patents,
         know-how and other intellectual property arising out of the conduct of
         the Project by any person, including any technology acquired by Newco
         from a third party, that relates to the Products and which is not (in
         the case of the Compound) or which cannot be segregated into (nor does
         it constitute) Elan Intellectual Property or Acusphere Intellectual
         Property.

         "NEWCO BYE-LAWS" shall mean the Memorandum of Association and Bye-Laws
         of Newco Limited.

         "PARTICIPANT" shall mean Acusphere or Elan, as the case may be, and
         "PARTICIPANTS" shall mean both of the Participants together.

         "PARTY" shall mean Elan, Acusphere, or Newco, as the case may be, and
         "PARTIES" shall mean all such parties together.



                                       5

<PAGE>
         "PERSON" shall mean an individual, partnership, corporation, limited
         liability company, business trust, joint stock company, trust,
         unincorporated association, joint venture, governmental entity or
         authority or other entity of whatever nature.

         "PERMITTED TRANSFEREE" shall mean any Affiliate or subsidiary of Elan,
         EIS or Acusphere, to whom this Agreement may be assigned, in whole or
         in part, pursuant to the terms hereof or in the case of Elan and EIS, a
         special purpose financing entity created by Elan or EIS or their
         respective Affiliates.

         "PRODUCTS" shall mean formulations of the Compound(s) for use as a
         human therapeutic for a specified medical condition.

         "PROJECT" shall mean all activity as undertaken by or on behalf of
         Newco in order to develop the Products in accordance with the Business
         Plan.

         "R&D COMMITTEE" shall have the meaning set forth in Clause 5.2 hereof.

         "REGISTRATION RIGHTS AGREEMENTS" shall mean the Registration Rights
         Agreements of even date herewith relating to Newco and Acusphere,
         respectively.

         "REGULATORY APPLICATION" shall mean any regulatory application or any
         other application for marketing approval for a Product, which Newco
         will file in any country of the Territory, including any supplements or
         amendments thereto.

         "REGULATORY APPROVAL" shall mean the final approval to market a Product
         in any country of the Territory, and any other approval which is
         required to launch the Product in the normal course of business.

         "RHA" shall mean any relevant government health authority (or successor
         agency thereof) in any country of the Territory whose approval is
         necessary to market a Product in the relevant country of the Territory.

         "RESEARCH AND DEVELOPMENT PROGRAM" has the meaning set forth in Clause
         6.1.

         "RESEARCH AND DEVELOPMENT TERM" shall mean the research and development
         stage of the Business Plan, which stage shall be deemed terminated upon
         the first commercial launch of a Product by Newco.

         "SECURITIES ACT" shall mean the Securities Act of 1933, as amended.

         "SHARES" shall mean the shares of Common Shares and shares of Preferred
         Shares of Newco.



                                       6


<PAGE>
         "SHAREHOLDER" shall mean any of EIS, Acusphere, any Permitted
         Transferee or any other Person who subsequently becomes bound by this
         Agreement as a holder of the Shares, and "SHAREHOLDERS" shall mean all
         of the Shareholders together.

         "TECHNOLOGICAL COMPETITOR OF ELAN" shall have the meaning assigned
         thereto in the Elan License Agreement.

         "TERM" shall mean the term of this Agreement.

         "TERRITORY" shall mean all of the countries of the world.

         "UNITED STATES DOLLAR" and "US$" and "$" shall mean the lawful currency
         of the United States of America.

1.2      In addition, the following definitions have the meanings in the Clauses
         corresponding thereto, as set forth below.

         DEFINITION                                CLAUSE

         "AAA"                                      18.4
         "Closing"                                  4.3
         "Common Shares"                            Recital
         "Confidential Information"                 21.1
         "Co-sale Notice"                           16.4
         "Expert"                                   18.4
         "Management Committee"                     5.2.1
         "Notice of Exercise"                       16.3
         "Notice of Intention"                      16.3
         "Offered Shares"                           16.3
         "Offer Price"                              16.3
         "Preferred Shares"                         Recital
         "R&D Committee"                            5.2.2
         "Remaining Shareholders"                   16.4
         "Relevant Event"                           19.2
         "Selling Shareholder"                      16.3
         "Tag-Along Right"                          16.4
         "Transaction Proposal"                     16.3
         "Transfer"                                 16.1
         "Transferee Terms"                         16.4
         "Transferring Shareholder"                 16.4

1.3      Words importing the singular shall include the plural and vice versa.


                                       7

<PAGE>

1.4      Unless the context otherwise requires, reference to a recital, article,
         paragraph, provision, clause or schedule is to a recital, article,
         paragraph, provision, clause or schedule of or to this Agreement.

1.5      Reference to a statute or statutory provision includes a reference to
         it as from time to time amended, extended or re-enacted.

1.6      The headings in this Agreement are inserted for convenience only and do
         not affect its construction.

1.7      Unless the context or subject otherwise requires, references to words
         in one gender include references to the other genders.

1.8      Capitalized terms used but not defined herein shall have the meanings
         ascribed in the Definitive Documents, if defined therein.

                                    CLAUSE 2

                       BUSINESS AND SELECTION OF COMPOUNDS

2.1      The primary objective of the Agreement is to regulate the business of
         the development, testing, registration, manufacture, commercialization
         and licensing of Products in the Field in the Territory and to achieve
         the other objectives set out in this Agreement. The focus of the
         Business will be to develop the Products using the Elan Intellectual
         Property, the Acusphere Intellectual Property and the Newco
         Intellectual Property to agreed-upon specifications and timelines.

2.2      The central management and control of Newco shall be exercised in
         Bermuda and shall be vested in the Directors and such Persons as they
         may delegate the exercise of their powers in accordance with the Newco
         Bye-Laws. The Shareholders agree to conduct the Business in such a
         manner as to ensure that Newco is liable to taxation in Bermuda and not
         in any other jurisdiction. The Participants shall use their best
         endeavors to ensure that to the extent required the sole residence of
         Newco in Bermuda, that all meetings of the Directors are held in
         Bermuda or other jurisdictions outside the United States and generally
         to ensure that Newco is treated as resident for taxation purposes in
         Bermuda.

2.3      The Parties hereby nominate as a Compound [CONFIDENTIAL TREATMENT
         REQUESTED] /*/ for local effect and controlled release using a Mode of
         Administration (other than a [CONFIDENTIAL TREATMENT REQUESTED]/*/) to
         treat asthma [CONFIDENTIAL TREATMENT REQUESTED]/*/. Subject to Clauses
         2.4 and 2.5, the Management Committee shall, by unanimous agreement,
         nominate two other Compounds, in addition to [CONFIDENTIAL TREATMENT
         REQUESTED]/*/, for development as a


                                       8

<PAGE>


         Product in a specific device by a specific Mode of Administration to
         treat a specific medical condition having regard to the following
         criteria:

         2.3.1    development cost of each of the Compounds in such Field, as
                  estimated by the Management Committee;

         2.3.2    market potential of each of the Compounds in such Field, as
                  estimated by the Management Committee;

         2.3.3    results of regulatory and intellectual property due diligence
                  primarily focused on determining whether there are any
                  regulatory and third party intellectual property issues which
                  might impact the development and marketing of each of the
                  Compounds in such Field; and

         2.3.4    whether the nominated Compound is subject to contractual
                  obligations, existing at the date of nomination, of Elan or
                  Acusphere which would prevent the conduct of the research and
                  development program or from granting Newco the right to
                  Commercialize the nominated Compound or which may adversely
                  affect the scope and/or nature of the rights which could be
                  granted to Newco and thereby the potential commercial
                  viability of the nominated Compound.

         The Management Committee shall prioritize the research and development
         programs with respect to such additional Compounds. If the Management
         Committee unanimously determines that the research, development and
         Commercialization of a Product would require additional technology
         owned or licensed by Elan and/or Acusphere, as the case may be, then
         the Parties shall discuss in good faith in-licensing such additional
         technology, subject to among other things, third party contractual
         obligations. In such case, the Parties shall negotiate in good faith
         such amendments as are required to this Agreement.

2.4      The selection of the Compounds or any substitute Compounds shall be
         subject to, inter alia, the then existing contractual arrangements of
         Elan and Acusphere and such discussions as Elan or Acusphere are having
         with one or more third parties at the time of such selection.
         [CONFIDENTIAL TREATMENT REQUESTED]/*/ On the date of selection of a
         Compound by the Management Committee,

                  (a)      [CONFIDENTIAL TREATMENT REQUESTED]/*/; and

                  (b)      Acusphere shall confirm that the Acusphere
                           Intellectual Property as it relates to the selected
                           Compound is not subject to contractual obligations of
                           Acusphere to an unaffiliated third party; and

         provided, however, that if any such contractual obligation exists,
         Acusphere and/or


                                       9

<PAGE>

         Elan, as the case may be, shall prior to the date of selection of the
         Compound inform the other of the scope and extent of any such
         contractual obligation.

2.5      The Management Committee may determine, by unanimous agreement, that a
         Compound should be abandoned by Newco and accordingly deleted from the
         list of Compounds to be advanced in the Project where the results of
         the regulatory and intellectual property due diligence described in
         Clause 2.3.3 reveal regulatory or third party intellectual property
         issues which might materially impact the development and
         Commercialization of a Compound in the Field.

2.6      Should a Compound fail to meet agreed specifications, the Management
         Committee shall terminate the portion of the Project that relates to
         such Compound. The Parties shall review in good faith the possibility
         of developing one substitute compound, or in-licensing or acquiring the
         rights from one or more third parties to one substitute compound,
         unless Phase II (as such term is commonly used in connection with FDA
         applications) has been initiated with respect to the terminated
         Compound; provided that no more than one substituted compound is
         contemplated to be considered during the course of this Agreement.
         Alternatively, [CONFIDENTIAL TREATMENT REQUESTED]/*/. In either case,
         the Parties shall negotiate in good faith such amendments as are
         required to this Agreement, such as amending the provisions regulating
         non-competition.


                                    CLAUSE 3

                         REPRESENTATIONS AND WARRANTIES

3.1      REPRESENTATIONS AND WARRANTIES OF NEWCO: Newco hereby represents and
         warrants to each of the Shareholders as follows, as of the Closing
         Date:

         3.1.1    ORGANIZATION: Newco is an exempted company duly organized,
                  validly existing and in good standing under the laws of
                  Bermuda, and has all the requisite corporate power and
                  authority to own and lease its properties, to carry on its
                  business as presently conducted and as proposed to be
                  conducted.

         3.1.2    CAPITALIZATION: As of the Closing Date, the authorized capital
                  stock of Newco consists of 6,000 shares of Common Shares and
                  6,000 shares of Preferred Shares. Prior to the Closing Date,
                  no shares of capital stock of Newco have been issued.

         3.1.3    AUTHORIZATION: The execution, delivery and performance by
                  Newco of this Agreement, including the issuance of the Shares,
                  have been duly authorized by all requisite corporate actions;
                  this Agreement has been duly



                                       10

<PAGE>

                  executed and delivered by Newco and is the valid and binding
                  obligation of Newco, enforceable against it in accordance with
                  its terms except as limited by applicable bankruptcy,
                  insolvency, reorganization, moratorium and other laws of
                  general application affecting the enforcement of creditors'
                  rights generally, and except as enforcement of rights to
                  indemnity and contribution hereunder may be limited by United
                  States federal or state securities laws or principles of
                  public policy. The Shares, when issued as contemplated hereby,
                  will be validly issued and outstanding, fully paid and
                  non-assessable and not subject to pre-emptive or any other
                  similar rights of the Shareholders or others.

         3.1.4    NO CONFLICTS: The execution, delivery and performance by Newco
                  of this Agreement, the issuance, sale and delivery of the
                  Shares, and compliance with the provisions hereof by Newco,
                  will not:

                  (i)      violate any provision of applicable law, statute,
                           rule or regulation applicable to Newco or any ruling,
                           writ, injunction, order, judgment or decree of any
                           court, arbitrator, administrative agency or other
                           governmental body applicable to Newco or any of its
                           properties or assets;

                  (ii)     conflict with or result in any breach of any of the
                           terms, conditions or provisions of, or constitute
                           (with notice or lapse of time or both) a default (or
                           give rise to any right of termination, cancellation
                           or acceleration) under its charter or organizational
                           documents or any material contract to which Newco is
                           a party, except where such violation, conflict or
                           breach would not, individually or in the aggregate,
                           have a material adverse effect on Newco; or

                  (iii)    result in the creation of, any Encumbrance upon any
                           of the properties or assets of Newco.

         3.1.5    APPROVALS: As of the Closing Date, no permit, authorization,
                  consent or approval of or by, or any notification of or filing
                  with, any Person is required in connection with the execution,
                  delivery or performance of this Agreement by Newco. Newco has
                  full authority to conduct its business as contemplated in the
                  Business Plan and the Definitive Documents.

         3.1.6    DISCLOSURE: This Agreement does not contain any untrue
                  statement of a material fact or omit to state any material
                  fact necessary to make the statements contained herein not
                  misleading. Newco is not aware of any material contingency,
                  event or circumstance relating to its business or prospects,
                  which could have a material adverse effect thereon, in order
                  for the disclosure herein relating to Newco not to be
                  misleading in any material respect.


                                       11


<PAGE>
         3.1.7    NO BUSINESS; NO LIABILITIES: Newco has not conducted any
                  business or incurred any liabilities or obligations prior to
                  the Closing Date, except solely in connection with its
                  organization and formation.

3.2      REPRESENTATIONS AND WARRANTIES OF THE SHAREHOLDERS: Each of the
         Shareholders hereby severally represents and warrants to Newco as
         follows as of the Closing Date:

         3.2.1    ORGANIZATION: Such Shareholder is a corporation duly organized
                  and validly existing under the laws of its jurisdiction of
                  organization and has all the requisite corporate power and
                  authority to own and lease its respective properties, to carry
                  on its respective business as presently conducted and as
                  proposed to be conducted and to carry out the transactions
                  contemplated hereby.

         3.2.2    AUTHORITY: Such Shareholder has full legal right, power and
                  authority to enter into this Agreement and to perform its
                  obligations hereunder, which have been duly authorized by all
                  requisite corporate action. This Agreement is the valid and
                  binding obligation of such Shareholder, enforceable against it
                  in accordance with its terms except as limited by applicable
                  bankruptcy, insolvency, reorganization, moratorium and other
                  laws of general application affecting the enforcement of
                  creditors' rights generally, and except as enforcement of
                  rights to indemnity and contribution hereunder may be limited
                  by United States federal or state securities laws or
                  principles of public policy.

         3.2.3    NO CONFLICTS: The execution, delivery and performance by such
                  Shareholder of this Agreement, purchase of the Shares, and
                  compliance with the provisions hereof by such Shareholder will
                  not:

                  (i)      violate any provision of applicable law, statute,
                           rule or regulation known by and applicable to such
                           Shareholder or any ruling, writ, injunction, order,
                           judgment or decree of any court, arbitrator,
                           administrative agency or other governmental body
                           applicable to such Shareholder or any of its
                           properties or assets;

                  (ii)     conflict with or result in any breach of any of the
                           terms, conditions or provisions of, or constitute
                           (with notice or lapse of time or both) a default (or
                           give rise to any right of termination, cancellation
                           or acceleration) under the charter or organizational
                           documents of such Shareholder or any material
                           contract to which such Shareholder is a



                                       12

<PAGE>
                           party, except where such violation, conflict or
                           breach would not, individually or in the aggregate,
                           have a material adverse effect on such Shareholder;
                           or

                  (iii)    result in the creation of, any Encumbrance upon any
                           of the properties or assets of such Shareholder.

         3.2.4    APPROVALS: As of the Closing Date, no permit, authorization,
                  consent or approval of or by, or any notification of or filing
                  with, any Person is required in connection with the execution,
                  delivery or performance of this Agreement by such Shareholder.

         3.2.5    INVESTMENT REPRESENTATIONS: Such Shareholder is sophisticated
                  in transactions of this type and capable of evaluating the
                  merits and risks of its investment in Newco. Such Shareholder
                  has not been formed solely for the purpose of making this
                  investment and such Shareholder is acquiring the Common Shares
                  and Preferred Shares for investment for its own account, not
                  as a nominee or agent, and not with the view to, or for resale
                  in connection with, any distribution of any part thereof. Such
                  Shareholder understands that the Shares have not been
                  registered under the Securities Act or applicable state and
                  foreign securities laws by reason of a specific exemption from
                  the registration provisions of the Securities Act and
                  applicable state and foreign securities laws, the availability
                  of which depends upon, among other things, the bona fide
                  nature of the investment intent and the accuracy of such
                  Shareholders' representations as expressed herein. Such
                  Shareholder understands that no public market now exists for
                  any of the Shares and that there is no assurance that a public
                  market will ever exist for such Shares.

                                    CLAUSE 4

                            AUTHORIZATION AND CLOSING

4.1      Newco has authorized the issuance to (i) EIS of 2,388 shares of
         Preferred Shares and (ii) Acusphere of 6,000 shares of Common Shares
         and 3,612 shares of Preferred Shares, issuable as provided in Clause
         4.3 hereof.

4.2      Acusphere and EIS hereby subscribe for the number of Shares set forth
         in Clause 4.1 and shall pay to Newco in consideration therefor, by wire
         transfer of immediately available funds (to a bank account established
         by Newco in connection with Completion) the subscription amounts each
         as provided in Clause 4.4.1.



                                       13


<PAGE>

4.3      The closing (the "CLOSING") shall take place at the offices of Cahill
         Gordon & Reindel, 80 Pine Street, New York, New York 10005 on the
         Closing Date or such other places if any, as the Parties may agree and
         shall occur contemporaneously with the closing under the Acusphere
         Securities Purchase Agreement.

4.4      At the Closing, each of the Shareholders shall take or (to the extent
         within its powers) cause to be taken the following steps at directors
         and shareholder meetings of Newco, or such other meetings or locations,
         as appropriate:

         4.4.1    Newco shall issue and sell to EIS, and EIS shall purchase from
                  Newco, upon the terms and subject to the conditions set forth
                  herein, 2,388 shares of Preferred Shares for an aggregate
                  purchase price of $2,985,000;

                  Newco shall issue and sell to Acusphere, and Acusphere shall
                  purchase from Newco, upon the terms and conditions set forth
                  herein, (i) 6,000 shares of Common Shares for an aggregate
                  purchase price of $4,515,000 and (ii) 3,612 shares of
                  Preferred Shares for an aggregate purchase price of
                  $7,500,000;

         4.4.2    the Parties shall execute and deliver to each other, as
                  applicable, certificates in respect of the Common Shares and
                  Preferred Shares described above and any other certificates,
                  resolutions or documents which the Parties shall reasonably
                  require;

         4.4.3.   the adoption by Newco of Newco Bye-Laws;

         4.4.4.   the appointment of Kevin Insley, Sherri Oberg, Howard
                  Bernstein, Steven Delaney, Stephen J. Rossiter, and Dawn
                  Griffiths as Directors of Newco;

         4.4.5.   the resignation of all directors and the secretary of Newco
                  holding office prior to the execution of this Agreement and
                  delivery of written confirmation under seal by each Person so
                  resigning that he has no claim or right of action against
                  Newco and that Newco is not in any way obligated or indebted
                  to him; and

         4.4.6.   the transfer to Newco of the share register.

4.5      EXEMPTION FROM REGISTRATION:

         The Shares will be issued under an exemption or exemptions from
         registration under the Securities Act. Accordingly, the certificates
         evidencing the Shares shall, upon issuance, contain the following
         legend:



                                       14


<PAGE>

         THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
         SECURITIES ACT OF 1933, AS AMENDED, OR ANY SECURITIES LAWS OF A STATE
         OR OTHER JURISDICTION AND MAY NOT UNDER ANY CIRCUMSTANCES BE SOLD,
         TRANSFERRED, OR OTHERWISE DISPOSED OF (OTHER THAN TO AN AFFILIATE OF
         THE ORIGINAL HOLDER OR AS OTHERWISE PERMITTED IN THE AGREEMENT PURSUANT
         TO WHICH THEY WERE ISSUED) EXCEPT PURSUANT TO (I) AN EFFECTIVE
         REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND ANY APPLICABLE
         STATE SECURITIES OR BLUE SKY LAWS, OR (II) TO THE EXTENT APPLICABLE,
         RULE 144 UNDER THE SECURITIES ACT (OR ANY SIMILAR RULE UNDER THE
         SECURITIES ACT RELATING TO THE DISPOSITION OF SECURITIES) TOGETHER WITH
         AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE CORPORATION THAT
         REGISTRATION IS NOT REQUIRED UNDER SUCH ACT OR APPLICABLE STATE
         SECURITIES LAWS.

4.6.     Newco shall use reasonable efforts to file any documents that require
         filing with the Registrar of Companies in Bermuda within the prescribed
         time limits. EIS and Acusphere shall provide all reasonable
         co-operation to Newco in relation to the matters set forth in this
         Clause 4.6.

4.7.     In the event that EIS exercises the Exchange Right, Newco shall,
         immediately upon such exercise, take all necessary steps to ensure that
         EIS is duly and validly issued and has full legal right, title and
         interest in and to the shares of Preferred Shares covered thereby.

                                    CLAUSE 5

                    DIRECTORS; MANAGEMENT AND R&D COMMITTEES

5.1.     DIRECTORS:

         5.1.1    Prior to the exercise of the Exchange Right, the Board shall
                  be composed of five Directors.

                  Acusphere shall have the right to nominate four directors of
                  Newco, ("ACUSPHERE DIRECTORS") and EIS shall have the right to
                  nominate one Director of Newco ("EIS DIRECTOR") which
                  Director, save as further provided herein, shall only be
                  entitled to 15% of the votes of the Board.



                                       15

<PAGE>
                  In the event that the Exchange Right is exercised by EIS
                  within (2) years following the Closing Date, the EIS Director
                  shall only be entitled to 15% of the votes of the Board until
                  the expiry of (2) years from the Closing Date.

                  In the event that the Exchange Right is exercised by EIS at
                  any time after years following the Closing Date or upon the
                  expiry of (2) years following the Closing Date where the
                  Exchange Right has been exercised by EIS within two (2) years
                  following the Closing Date, each of Acusphere, and EIS shall
                  cause the Board to be reconfigured so that an equal number of
                  Directors are designated by EIS and Acusphere and that each of
                  the Directors has equal voting power.

         5.1.2    If EIS removes the EIS Director, or Acusphere removes any of
                  the Acusphere Directors, EIS or Acusphere, as the case may be,
                  shall indemnify the other Shareholder against any claim by
                  such removed Director arising from such removal.

         5.1.3    The Directors shall meet not less than three times in each
                  Financial Year and all Board meetings shall be held in
                  Bermuda.

         5.1.4    At any such meeting, the presence of the EIS Director and at
                  least three of the Acusphere Directors shall be required to
                  constitute a quorum and, subject to Clause 17 hereof, the
                  affirmative vote of a majority of the Directors present at a
                  meeting at which such a quorum is present shall constitute an
                  action of the Directors. In the event of any meeting being
                  inquorate, the meeting shall be adjourned for a period of
                  seven days. A notice shall be sent to the EIS Director and the
                  Acusphere Directors specifying the date, time and place where
                  such adjourned meeting is to be held and reconvened.

         5.1.5    On the Closing Date, Acusphere may appoint one of the
                  Acusphere Directors to be the chairman of Newco. Such chairman
                  of Newco shall hold office until:

                  (i)      the first meeting of the Board following the exercise
                           by EIS of the Exchange Right, where the Exchange
                           Right has been exercised by EIS after two years
                           following the Closing Date; or

                  (ii)     the first meeting of the Board following the expiry
                           of (2) years following the Closing Date where the
                           Exchange Right has been exercised by EIS within 2
                           years following the Closing Date

                  (in each case the "CHAIRMAN STATUS BOARD MEETING").



                                       16

<PAGE>

                  After the Chairman Status Board Meeting, each of EIS and
                  Acusphere, beginning with EIS at the Chairman Status Board
                  Meeting, shall have the right, exercisable alternatively, of
                  nominating one Director to be chairman of Newco for a term of
                  one year.

                  If the chairman is unable to attend any meeting of the Board
                  held prior to the Chairman Status Board Meeting, the Acusphere
                  Directors shall be entitled to appoint another Acusphere
                  Director to act as chairman in his place at the meeting.

                  If the chairman of Newco is unable to attend any meeting of
                  the Board held after the Chairman Status Board Meeting, the
                  Directors shall be entitled to appoint another Director to act
                  as chairman of Newco in his place at the meeting.

         5.1.6    In case of an equality of votes at a meeting of the Board, the
                  chairman of Newco shall not be entitled to a second or casting
                  vote. In the event of continued deadlock, the Board shall
                  resolve the deadlock pursuant to the provisions set forth in
                  Clause 18.

5.2      MANAGEMENT AND R&D COMMITTEES:

                  5.2.1 Newco's board of directors shall appoint a management
                  committee (the "MANAGEMENT COMMITTEE") to consist initially of
                  four members, two of whom shall be nominated by Elan and two
                  of whom shall be nominated by Acusphere, and each of whom
                  shall be entitled to one vote, whether or not present at any
                  Management Committee meeting. Decisions of the Management
                  Committee shall require approval of at least one Elan nominee
                  on the Management Committee and one Acusphere nominee on the
                  Management Committee.

                  Each of Elan and Acusphere shall be entitled to remove any of
                  their nominees to the Management Committee and appoint a
                  replacement in place of any nominees so removed. The number of
                  members of the Management Committee may be altered if agreed
                  to by a majority of the directors of Newco; provided that,
                  each of Elan and Acusphere shall be entitled to appoint an
                  equal number of members to the Management Committee. The
                  Management Committee shall be responsible for, inter alia,
                  devising, implementing and reviewing strategy for the Project.

                  5.2.2    The Management Committee shall appoint a research and
                           development committee (the "R&D COMMITTEE"), which
                           shall initially be comprised of four members, two of
                           whom shall be nominated by Elan and two of whom




                                       17


<PAGE>

                           shall be nominated by Acusphere, and each of whom
                           shall have one vote, whether or not present at an R&D
                           Committee meeting during which research and
                           development issues are discussed. Decisions of the
                           R&D Committee shall require approval of at least one
                           Elan nominee on the R&D Committee and one Acusphere
                           nominee on the R&D Committee.

                           Each of Elan and Acusphere shall be entitled to
                           remove any of their nominees to the R&D Committee and
                           appoint a replacement in place of any nominees so
                           removed. The number of members of the R&D Committee
                           may be altered if agreed to by a majority of the
                           directors of Newco provided that each of Elan and
                           Acusphere shall be entitled to appoint an equal
                           number of members to the R&D Committee.

                  5.2.3    The R&D Committee shall be responsible for:

                           (a)      designing the Research and Development
                                    Program for consideration by the Management
                                    Committee;

                           (b)      if deemed advisable, establishing a joint
                                    Project team consisting of an equal number
                                    of team members from Elan and Acusphere,
                                    including one Project leader from each of
                                    Elan and Acusphere; and

                           (c)      implementing the Research and Development
                                    Program as approved by the Management
                                    Committee.

                  5.2.4    In the event of any dispute amongst the R&D
                           Committee, the R&D Committee shall refer such dispute
                           to the Management Committee whose decision on the
                           dispute shall be binding on the R&D Committee.

                           If the Management Committee cannot resolve the
                           matter, the dispute will be referred to a designated
                           senior officer of each of Elan and Acusphere, and
                           thereafter, in the event of continued deadlock,
                           pursuant to the deadlock provisions to be set forth
                           in Clause 18. This process shall also apply to any
                           dispute within the Management Committee.

                                    CLAUSE 6

                          THE BUSINESS PLAN AND REVIEWS

6.1      The Directors shall meet together as soon as reasonably practicable
         after the Closing Date and shall agree upon and approve the Business
         Plan for the current Financial Year within 180 days of the Closing
         Date. The Business Plan shall contain, among other things, a research
         and development program (the "RESEARCH AND DEVELOPMENT PROGRAM") which
         shall include to the extent practicable, the



                                       18

<PAGE>

         research and development objectives, desired Product specifications,
         clinical indications, preliminary clinical trial designs (Phase I/II),
         development timelines, budgeted costs and the relative responsibilities
         of Acusphere and Elan as it relates to the implementation of the
         Research and Development Program.

6.2.     The Business Plan shall be subject to ongoing review by the Directors
         and the approval of the EIS Director and the Acusphere Directors on a
         quarterly basis.

6.3.     Neither Participant shall be obliged to provide subsequent funding to
         Newco in the absence of quarterly approval of the Business Plan and a
         determination by each Participant, in its sole discretion
         (notwithstanding Clause 17.2 below), that Development Funding (as such
         term is defined in the Securities Purchase Agreement) shall be provided
         for the development of the Products in accordance with the terms of the
         Securities Purchase Agreement.


                                    CLAUSE 7

                          RESEARCH AND DEVELOPMENT WORK

7.1      Subject to the provisions of Clause 6.3, Acusphere and Elan shall
         provide at their respective discretion such research and development
         services as is requested by Newco and as articulated in the Business
         Plan. Newco shall pay Acusphere and Elan for any research and
         development work carried out by them on behalf of Newco [CONFIDENTIAL
         TREATMENT REQUESTED]/*/ during the Research and Development Program
         developed by the R&D Committee and approved by the Management
         Committee, subject to the proper vouching of research and development
         work and expenses. An invoice shall be issued to Newco by Acusphere or
         Elan, as applicable, [CONFIDENTIAL TREATMENT REQUESTED]/*/ following
         the [CONFIDENTIAL TREATMENT REQUESTED]/*/ in which work was performed.
         The payments by Newco to Acusphere or Elan in carrying out such
         research and development work shall be calculated by reference to the
         fully allocated costs thereof incurred by Acusphere and Elan calculated
         in accordance with generally accepted accounting principles
         consistently applied plus [CONFIDENTIAL TREATMENT REQUESTED]/*/, or
         [CONFIDENTIAL TREATMENT REQUESTED]/*/ FTE rate agreed to by the
         unanimous vote of the Management Committee. Research and development
         activities that are outsourced to third party providers shall be
         charged to Newco at fully burdened actual costs.

7.2      Elan and Acusphere shall permit Newco or its duly authorized
         representative on reasonable notice and at any reasonable time during
         normal business hours to have access to inspect and audit the accounts
         and records of Elan or Acusphere and any other book, record, voucher,
         receipt or invoice relating to the calculation or the




                                       19

<PAGE>
         cost of the Research and Development Program and to the accuracy of the
         reports which accompanied them. Any such inspection of Elan's or
         Acusphere's records, as the case may be, shall be at the expense of
         Newco, except that if such inspection reveals an overpayment in the
         amount paid to Elan or Acusphere, as the case may be, for the Research
         and Development Program hereunder in any Financial Year of 5% or more
         of the amount due to Elan or Acusphere, as the case may be, then the
         expense of such inspection shall be borne solely by Elan or Acusphere,
         as the case may be, instead of by Newco. Any surplus over the sum
         properly payable by Newco to Elan or Acusphere, as the case may be,
         shall be paid promptly by Elan or Acusphere, as the case may be, to
         Newco. If such inspection reveals a deficit in the amount of the sum
         properly payable to Elan or Acusphere, as the case may be, by Newco,
         Newco shall pay the deficit to Elan or Acusphere, as the case may be.


                                    CLAUSE 8

                                COMMERCIALIZATION

8.1      Newco shall diligently pursue the research, development, prosecution
         and Commercialization of the Products as provided in the Business Plan.

         At such time as Newco notifies Elan in writing that Newco in good faith
         intends to Commercialize a Product (other than to manufacture or have
         manufactured the Product which is the subject of Clause 13 below),
         Elan, plc or any Affiliate of Elan shall have a first option to
         negotiate the terms of any agreement for the Commercialization of such
         Product (the "ELAN OPTION PRODUCT"), which option shall be exercised
         within [CONFIDENTIAL TREATMENT REQUESTED/*/ of Elan's receipt of such
         written notification from Newco (the "ELAN/NEWCO OPTION"). If Elan
         elects to enter into such negotiations, the Participants shall
         negotiate in good faith the terms of an applicable agreement that would
         grant Elan such Commercialization rights.

         If, despite good faith negotiations, Elan, plc or the relevant
         Affiliate and Newco do not reach agreement within [CONFIDENTIAL
         TREATMENT REQUESTED]/*/ from Elan's exercise of the Elan/Newco Option
         (the "PERIOD OF NEGOTIATION"), then Newco shall be free to enter into
         negotiations with a third party (other than a Technological Competitor
         Of Elan) to agree terms upon which such third party would Commercialize
         the relevant Product in the Territory, which terms when taken as a
         whole, are not more favorable to the third party than the principal
         terms of the last written proposal offered by Newco to Elan, plc or the
         relevant Affiliate or by Elan, plc or the relevant Affiliate to Newco,
         as the case may be. The definitive agreement between Newco and such
         third party to Commercialize the relevant Product in the Territory
         shall be subject to the written approval of the



                                       20

<PAGE>
         Participants, which approval shall not to be unreasonably withheld or
         delayed, and which approval shall be further subject to the last
         paragraph of this Clause 8.1.

         Acusphere, acting on behalf of Newco, shall have the right to initiate
         negotiations with a third party (other than a Technological Competitor
         Of Elan) during the Period of Negotiation but Newco may not enter into
         an agreement for Commercialization until such Period of Negotiation has
         terminated.

         If (i) the Product that is the subject of such Elan/Newco Option
         relates to a therapeutic area in which Elan, plc and/or its Affiliates
         have a marketing or sales presence and (ii) Newco has not entered into
         an agreement with a third party within [CONFIDENTIAL TREATMENT
         REQUESTED]/*/ from the expiration of the Period of Negotiation, then
         the Elan/Newco Option shall be deemed to have re-commenced upon the
         same terms as set forth herein but with a [CONFIDENTIAL TREATMENT
         REQUESTED]/*/ option period as opposed to the initial [CONFIDENTIAL
         TREATMENT REQUESTED]/*/ Period of Negotiation.

         Newco and the Acusphere Directors and EIS Director shall use their
         respective good faith and reasonable business judgement in the best
         interest of Newco when negotiating, agreeing and approving terms for
         the Commercialization of the Products.

                                    CLAUSE 9

            OWNERSHIP OF INTELLECTUAL PROPERTY RIGHTS/NON-COMPETITION

9.1.     The Parties acknowledge and agree to be bound by the provisions of
         Clause 3 of the Elan License Agreement and Clause 3 of the Acusphere
         License Agreement which set forth the agreement between the parties
         thereto in relation to the ownership of the Elan Intellectual Property,
         the Acusphere Intellectual Property and the Newco Intellectual property
         respectively.

9.2      The Parties acknowledge and agree to be bound by the provisions of
         Clause 4 of the Elan License Agreement and the provisions of Clause 4
         of the Acusphere License Agreement which set forth the agreement
         between the parties thereto in relation to the non-competition
         obligations of Elan and Acusphere, respectively.

                                    CLAUSE 10

                          INTELLECTUAL PROPERTY RIGHTS

10.1     Elan, [CONFIDENTIAL TREATMENT REQUESTED]/*/ sole discretion
         [CONFIDENTIAL TREATMENT REQUESTED]/*/ (i) secure the grant of any
         patent applications within the Elan Patents that relate to the Field;
         (ii) file and


                                       21


<PAGE>
         prosecute patent applications on patentable inventions and discoveries
         within the Elan Improvements that relate to the Field; (iii) defend all
         such applications against third party oppositions; and (iv) maintain in
         force any issued letters patent within the Elan Patents that relate to
         the Field (including any letters patent that may issue covering any
         such Elan Improvements that relate to the Field). Elan shall have the
         right in its sole discretion to control such filing, prosecution,
         defense and maintenance provided that Newco and Acusphere at their
         request shall be provided with copies of all documents relating to such
         filing, prosecution, defense and maintenance in sufficient time to
         review such documents and comment thereon prior to filing.

10.2     Acusphere, [CONFIDENTIAL TREATMENT REQUESTED]/*/ and sole discretion,
         [CONFIDENTIAL TREATMENT REQUESTED]/*/ (i) secure the grant of any
         patent applications within the Acusphere Patents that relate to the
         Field; (ii) file and prosecute patent applications on patentable
         inventions and discoveries within the Acusphere Improvements that
         relate to the Field; (iii) defend all such applications against third
         party oppositions; and (iv) maintain in force any issued letters patent
         within the Acusphere Patents that relate to the Field (including any
         letters patent that may issue covering any such Acusphere Improvements
         that relate to the Field). Acusphere shall have the right in its sole
         discretion to control such filing, prosecution, defense and maintenance
         provided that Elan and Newco at their request shall be provided with
         copies of all documents relating to such filing, prosecution, defense
         and maintenance in sufficient time to review such documents and comment
         thereon prior to filing.

10.3     In the event that Elan does not intend to file for patent protection on
         patentable inventions or discoveries within the Elan Intellectual
         Property that relates to the Field in one or more countries in the
         Territory after providing written notice to Newco and Acusphere, Newco
         shall have the option [CONFIDENTIAL TREATMENT REQUESTED]/*/, upon the
         prior written approval of Elan which approval shall not be unreasonably
         withheld, to request Elan to file and prosecute such patent
         application(s) jointly on behalf of Newco and Acusphere. Upon such
         written request from Newco, Elan shall be responsible for preparing and
         prosecuting and otherwise seeking patent protection for such Elan
         Intellectual Property described in this Clause 10.3. Any such Elan
         Intellectual Property shall be owned by Elan but Elan shall grant to
         Newco a royalty free exclusive license to such Elan Intellectual
         Property in the Field. The Parties shall have the right to remove their
         confidential information from any such patent application.

10.4     In the event that Acusphere does not intend to file for patent
         protection on patentable inventions or discoveries within the Acusphere
         Intellectual Property that relates to the Field in one or more
         countries in the Territory after providing written notice to Newco and
         Elan, Newco shall have the option [CONFIDENTIAL TREATMENT
         REQUESTED]/*/, upon the prior written approval of Acusphere



                                       22


<PAGE>

         which approval shall not be unreasonably withheld, to request Acusphere
         to file and prosecute such patent application(s) jointly on behalf of
         Newco and Elan. Upon such written request from Newco, Acusphere shall
         be responsible for preparing and prosecuting and otherwise seeking
         patent protection for such Acusphere Intellectual Property described in
         this Clause 10.4. Any such Acusphere Intellectual Property shall be
         owned by Acusphere but Acusphere shall grant a royalty free exclusive
         license to Newco to such Acusphere Intellectual Property in the Field.
         The Parties shall have the right to remove their confidential
         information from any such patent application.

10.5     Newco [CONFIDENTIAL TREATMENT REQUESTED]/*/ shall have the right but
         shall not be obligated (i) to file and prosecute patent applications on
         patentable inventions and discoveries within the Newco Intellectual
         Property; (ii) to defend all such applications against third party
         oppositions; and (iii) to maintain in force any issued letters patent
         within the Newco Patents (including any patents that issue on
         patentable inventions and discoveries within the Newco Intellectual
         Property). Newco shall have the right to control such filing,
         prosecution, defense and maintenance provided that the other Parties
         shall be provided with copies of all documents relating to such filing,
         prosecution, defense, and maintenance in sufficient time to review such
         documents and comment thereon prior to filing. The Parties shall have
         the right to remove their confidential information from any such patent
         application.

10.6     In the event that Newco informs both Elan and Acusphere that it does
         not intend to file an application on the Newco Intellectual Property in
         or outside the Field, Elan shall have the right to file and prosecute
         such patent applications on inventions that Elan invents solely or
         which relate predominantly to the Elan Intellectual Property, and
         Acusphere shall have the right to file and prosecute such patent
         applications on inventions which Acusphere invents solely or which
         relate predominantly to the Acusphere Intellectual Property, and Elan
         and Acusphere agree to negotiate in good faith on the course of action
         to be taken with respect to Newco inventions that relate to both the
         Elan and Acusphere Intellectual Property. The Parties shall have the
         right to remove their confidential information from any such patent
         application.

10.7     The Parties shall promptly inform each other in writing of any actual
         or alleged unauthorized use of any Elan Intellectual Property, the
         Acusphere Intellectual Property or the Newco Intellectual Property by a
         third party of which it becomes aware and provide the others with any
         available evidence of such unauthorized use.

10.8     At its option, as the case may be, Elan or Acusphere shall have the
         first option to enforce [CONFIDENTIAL TREATMENT REQUESTED]/*/ for its
         own benefit any unauthorized use of its respective Intellectual
         Property (the Elan Intellectual



                                       23

<PAGE>

         Property or the Acusphere Intellectual Property as the case may be) in
         the Field. At the enforcing party's request, the other Parties shall
         cooperate with such action. Should Elan or Acusphere decide not to
         enforce the Elan Intellectual Property or the Acusphere Intellectual
         Property respectively, against such unauthorized use in the Field,
         within a reasonable period but in any event within twenty (20) days
         after receiving written notice of such actual or alleged unauthorized
         use, Newco may in its discretion initiate such proceedings in its own
         name, [CONFIDENTIAL TREATMENT REQUESTED]/*/ for its own benefit, and at
         such Party's request, Elan and Acusphere shall cooperate with such
         action. Any recovery remaining after the deduction by Newco
         [CONFIDENTIAL TREATMENT REQUESTED]/*/ shall belong to Newco.
         Alternatively, the Parties may agree to institute such proceedings in
         their joint names and shall reach agreement as to the proportion in
         which they shall share the proceeds of any such proceedings
         [CONFIDENTIAL TREATMENT REQUESTED]/*/.

10.9     Newco shall have the first right but not the obligation to bring suit
         or otherwise take action against any unauthorized use of the Newco
         Intellectual Property. If any such alleged use occurs that gives rise
         to a cause of action both inside and outside the Field, Newco, in
         consultation with the other Parties, shall determine the course of
         action to be taken. In the event that Newco takes such action, Newco
         shall do so [CONFIDENTIAL TREATMENT REQUESTED]/*/ and all damages and
         monetary award recovered in or with respect to such action shall be the
         property of Newco. Newco shall keep Elan and Acusphere informed of any
         action in a timely manner so as to enable Acusphere and Elan to provide
         input in any such action and Newco shall reasonably take into
         consideration any such input. At Newco's request, the Parties shall
         cooperate with any such action [CONFIDENTIAL TREATMENT REQUESTED]/*/.

10.10    In the event that Newco does not bring suit or otherwise take action
         against any unauthorized use of the Newco Intellectual Property (i) if
         only one Participant determines to pursue such suit or take such action
         [CONFIDENTIAL TREATMENT REQUESTED]/*/, it shall be entitled to all
         damages and monetary award recovered in or with respect to such action
         [CONFIDENTIAL TREATMENT REQUESTED]/*/. At the Participant's request,
         Newco shall cooperate with any such action [CONFIDENTIAL TREATMENT
         REQUESTED]/*/.

10.11    In the event that a claim or proceeding is brought against Newco by a
         third party alleging that the sale, distribution or use of a Product in
         the Territory constitutes the unauthorized use of the intellectual
         property rights of such Party, Newco shall promptly advise the other
         Parties of such threat or suit.

10.12    Save in respect of claims by Newco against either Party or by a third
         party against Newco where there has been a breach of representation or
         warranty under Clause 7



                                       24


<PAGE>
         of either of the License Agreements by Elan or Acusphere, as the case
         may be, Newco shall indemnify, defend and hold harmless Elan or
         Acusphere, as the case may be, against all actions, losses, claims,
         demands, damages, costs and liabilities (including reasonable attorneys
         fees) relating directly or indirectly to all such claims or proceedings
         referred to in Clause 10.11, provided that Elan or Acusphere, as the
         case may be, shall not acknowledge to the third party or to any other
         person or entity the validity of any claims of such a third party, and
         shall not compromise or settle any claim or proceedings relating
         thereto without the prior written consent to Newco, not to be
         unreasonably withheld or delayed. [CONFIDENTIAL TREATMENT
         REQUESTED]/*/.

                                    CLAUSE 11

           CROSS LICENSING/EXPLOITATION OF PRODUCTS OUTSIDE THE FIELD

11.1     Solely for the purpose of and insofar as is necessary, in each case,
         for Elan to conduct research and development work on behalf of Newco,
         Newco hereby grants to Elan a non-exclusive, worldwide, royalty-free,
         fully paid-up license for the term of the Licenses:

         11.1.1   to use the Newco Intellectual Property in the Field, and

         11.1.2   subject to the terms and conditions of the Acusphere License,
                  a sublicense to use the Acusphere Intellectual Property in the
                  Field.

11.2     Solely for the purpose of and insofar as is necessary, in each case,
         for Acusphere to conduct research and development work on behalf of
         Newco, Newco hereby grants to Acusphere a non-exclusive, worldwide,
         royalty-free, fully paid-up license for the term of the Licenses:

         11.2.1   to use the Newco Intellectual Property in the Field, and

         11.2.2   subject to the terms and conditions of the Elan License, a
                  sublicense to use the Elan Intellectual Property in the Field.

11.3     Elan and Acusphere, as the case may be, shall be entitled to exploit
         the Newco Intellectual Property outside the Field subject to the
         Parties negotiating a license agreement in good faith (including all
         material provisions thereof, including as to whether the license should
         be exclusive or non-exclusive), pursuant to which Newco will grant Elan
         or Acusphere, as the case may be, a license under the Newco
         Intellectual Property outside the Field. The financial terms of the
         said license agreement shall have regard, inter alia, to:


                                       25

<PAGE>

         11.3.1   the amount of monies expended by Newco in developing the Newco
                  Intellectual Property;

         11.3.2   the materiality of the contribution of the Newco Intellectual
                  Property by comparison to the further research and development
                  work to be conducted, and of the Elan Intellectual Property
                  and the Acusphere Intellectual Property; and

         11.3.3   the financial return likely to be earned by Elan or Acusphere,
                  as the case may be, from the proposed exploitation outside the
                  Field; and

         11.3.4   the impact of the proposed exploitation of the Newco
                  Intellectual Property outside the Field on the exploitation of
                  the Newco Intellectual Property within the Field.

                                    CLAUSE 12

                                   REGULATORY

12.1     Newco shall keep the other Parties promptly and fully advised of
         Newco's regulatory activities, progress and procedures. Newco shall
         inform the other Parties of any dealings it shall have with an RHA, and
         shall furnish the other Parties with copies of all correspondence
         relating to the Products. The Parties shall collaborate to obtain any
         required Regulatory Approval of the RHA to market the Products.

12.2     Newco shall, at its own cost, file, prosecute and maintain any and all
         Regulatory Applications for the Products in the Territory in accordance
         with the Business Plan.

12.3     Subject to Clauses 12.5 and 12.6, any and all Regulatory Approvals
         obtained hereunder for any Product shall remain the property of Newco,
         provided that Newco shall allow Elan and Acusphere access thereto to
         enable Elan and Acusphere to fulfill their respective obligations and
         exercise their respective rights under this Agreement. Newco shall
         maintain such Regulatory Approvals at its own cost.

12.4     It is hereby acknowledged that there are inherent uncertainties
         involved in the registration of pharmaceutical products with the RHA's
         insofar as obtaining approval is concerned and such uncertainties form
         part of the business risk involved in undertaking the form of
         commercial collaboration as set forth in this Agreement.



                                       26

<PAGE>
12.5     All regulatory approvals and the DMF (Drug Master File) relating to
         [CONFIDENTIAL TREATMENT REQUESTED]/*/ shall be processed by and be the
         property of Elan and at all times held in Elan's sole name. Elan will
         authorize Newco to reference Elan's DMF, as described herein, with the
         FDA to the extent necessary for Newco's regulatory purposes.

12.6     All regulatory approvals and the DMF (Drug Master File) relating to
         [CONFIDENTIAL TREATMENT REQUESTED]/*/ shall be processed by and be the
         property of Acusphere and at all times held in Acusphere's sole name.
         Acusphere will authorize Newco to reference Acusphere's DMF, as
         described herein, with the FDA to the extent necessary for Newco's
         regulatory purposes.

                                    CLAUSE 13

                                  MANUFACTURING

13.1     Subject to Clause 13.2, Newco shall be responsible for manufacturing,
         or having manufactured, all quantities of Products required for the
         development and Commercialization of Products for use in the Field.

13.2     Notwithstanding the provisions of Clause 13.1, it is the expectation of
         the Parties that Newco shall enter into a supply agreement with Elan or
         Acusphere or a third party (other than a Technological Competitor of
         Elan), as the case may be, to allow for the commercial production of
         the Products on behalf of Newco, provided however, that Elan shall have
         the first right to manufacture and supply, and/or subcontract the
         manufacture and supply, of [CONFIDENTIAL TREATMENT REQUESTED]/*/ which
         are incorporated in the Products. In determining which of Elan or
         Acusphere or a third party shall provide such services, the Management
         Committee shall, in good faith, consider the respective infrastructure
         and experience of Elan, Acusphere and the relevant third parties.

13.3     The terms of the said supply agreements shall be on normal commercial
         terms, and shall be negotiated in good faith by the Parties thereto.

                                    CLAUSE 14

                        TECHNICAL SERVICES AND ASSISTANCE

14.1     Whenever commercially and technically feasible, Newco shall contract
         with Acusphere or Elan, as the case may be, to perform such other
         services as Newco may require, other than those specifically dealt with
         hereunder or in the License Agreements. In determining which Party
         should provide such services, the Management Committee shall take into
         account the respective infrastructure, capabilities and experience of
         Elan and Acusphere. There shall be no obligation upon either of
         Acusphere or Elan to perform such services.


                                       27

<PAGE>
14.2     Newco shall, if the Participants so agree, conclude an administrative
         support agreement with Elan and/or Acusphere on such terms as the
         Parties thereto shall in good faith negotiate. Such service agreement
         shall include, among other things, a right of Newco or its duly
         authorized representative on reasonable notice and at any reasonable
         time during normal business hours to have access to inspect and audit
         the books and records of Elan or Acusphere, as applicable, relating to
         such administrative services provided on behalf of Newco. Any such
         inspection of Elan's or Acusphere's records, as the case may be, shall
         be [CONFIDENTIAL TREATMENT REQUESTED]/*/. The administrative services
         shall include one or more of the following administrative services as
         requested by Newco:

         14.2.1   accounting, financial and other services;

         14.2.2   tax services;

         14.2.3   insurance services;

         14.2.4   human resources services;

         14.2.5   legal and company secretarial services;

         14.2.6   patent and related intellectual property services; and

         14.2.7   all such other services consistent with and of the same type
                  as those services to be provided pursuant to this Agreement,
                  as may be required.

         The foregoing list of services shall not be deemed exhaustive and may
         be changed from time to time upon written request by Newco.

14.3.    The Parties agree that each Party shall effect and maintain
         comprehensive general liability insurance in respect of all clinical
         trials and other activities performed by them on behalf of Newco. The
         Participants and Newco shall ensure that the industry standard
         insurance policies shall be in place for all activities to be carried
         out by Newco.

14.4     If Elan or Acusphere so requires, Acusphere or Elan, as the case may
         be, shall receive, at times and for periods mutually acceptable to the
         Parties, employees of the other Party (such employees to be acceptable
         to the receiving Party in the matter of qualification and competence)
         for instruction in respect of the Elan Intellectual Property or the
         Acusphere Intellectual Property, as the case may be, as necessary to
         further the Project.



                                       28

<PAGE>

14.5     The employees received by Elan or Acusphere, as the case may be, shall
         be subject to obligations of confidentiality no less stringent than
         those set out in Clause 21 and such employees shall observe the rules,
         regulations and systems adopted by the Party receiving the said
         employees for its own employees or visitors.

                                    CLAUSE 15

             AUDITORS, BANKERS, ACCOUNTING REFERENCE DATE; SECRETARY

15.1     Unless otherwise agreed by the Participants and save as may be provided
         to the contrary herein:

         15.1.1   the auditors of Newco shall be KMPG Peat Marwick of Vallis
                  Building, Hamilton, Bermuda;

         15.1.2   the Participants shall have the right of access for each
                  Participant's authorized auditors (reasonably acceptable to
                  the other Participant and subject to the confidentiality
                  undertakings hereunder) to audit the books and records of
                  Newco during regular business hours and upon reasonable prior
                  written notice;

         15.1.3   the bankers of Newco shall be Bank of Bermuda or such other
                  bank as may be mutually agreed from time to time;

         15.1.4   the accounting reference date of Newco shall be December 31st
                  in each Financial Year; and

         15.1.5   the secretary of Newco shall be I.S. Outerbridge or such other
                  Person as may be appointed by the Directors from time to time.

                                    CLAUSE 16

                              TRANSFERS OF SHARES;
                     RIGHT OF FIRST OFFER; TAG ALONG RIGHTS

GENERAL:

16.1.    Until such time as the Common Shares shall be registered pursuant to
         the Exchange Act and be publicly traded in an established securities
         market, no Shareholder shall, directly or indirectly, sell or otherwise
         transfer (each, a "TRANSFER") any Shares held by it except in as
         expressly permitted by and accordance with the terms of this Agreement.
         Newco shall not, and shall not permit any transfer agent or registrar
         for any Shares to, transfer upon the books of


                                       29

<PAGE>

         Newco any Shares from any Shareholder to any transferee, in any manner,
         except in accordance with this Agreement, and any purported transfer
         not in compliance with this Agreement shall be void.

         During the Research and Development Term, no Shareholder shall,
         directly or indirectly, sell or otherwise Transfer any of its legal
         and/or beneficial interest in the Shares held by it to any other
         Person. After completion of the Research and Development Term, a
         Shareholder may Transfer Shares provided such Shareholder complies with
         the provisions of Clauses 16.2, 16.3 and 16.4.

         Notwithstanding anything contained herein to the contrary, at all
         times, EIS and/or Acusphere shall have the right to Transfer any Shares
         to a Permitted Transferee of such Party, provided, however, that such
         Transfer does not result in adverse tax consequences for any other
         Parties and that such Permitted Transferee to which such legal and/or
         beneficial interest in the Shares have been transferred shall agree to
         be expressly subject to and bound by all the limitations and provisions
         which are embodied in this Agreement.

16.2     No Shareholder shall, except with the prior written consent of the
         other Shareholder, create or permit to subsist any Encumbrance in all
         or any of the Shares held by it (other than by a Transfer of such
         Shares in accordance with the provisions of this Agreement).

16.3     RIGHTS OF FIRST OFFER:

         If at any time after the end of the Research and Development Term a
         Shareholder shall desire to Transfer any Shares owned by it (a "SELLING
         SHAREHOLDER"), in any transaction or series of related transactions
         other than a Transfer to a Permitted Transferee, then such Selling
         Shareholder shall deliver prior written notice of its desire to
         Transfer (a "NOTICE OF INTENTION") (i) to Newco and (ii) to the
         Shareholders who are not the Selling Shareholder (and any transferee
         thereof permitted hereunder, if any), as applicable, setting forth such
         Selling Shareholder's desire to make such Transfer, the number of
         Shares proposed to be transferred (the "OFFERED SHARES") and the
         proposed form of transaction (the "TRANSACTION PROPOSAL"), together
         with any available documentation relating thereto, if any, and the
         price at which such Selling Shareholder proposes to Transfer the
         Offered Shares (the "OFFER PRICE"). The "Right of First Offer" provided
         for in this Clause 16 shall be subject to any "Tag Along Right"
         benefiting a Shareholder which may be provided for by Clause 16.4,
         subject to the exceptions set forth therein.

         Upon receipt of the Notice of Intention, the Shareholders who are not
         the Selling Shareholder shall have the right to purchase at the Offer
         Price the Offered Shares, exercisable by the delivery of notice to the
         Selling Shareholder (the "NOTICE OF EXERCISE"), with a copy to Newco,
         within 10 business days from the date of receipt



                                       30

<PAGE>

         of the Notice of Intention. If no such Notice of Exercise has been
         delivered by the Shareholders who are not the Selling Shareholder
         within such 10-business day period, or such Notice of Exercise does not
         relate to all of the Offered Shares covered by the Notice of Intention,
         then the Selling Shareholder shall be entitled to Transfer all of the
         Offered Shares to the intended transferee. In the event that all of the
         Offered Shares are not purchased by the non-selling Shareholders, the
         Selling Shareholder shall sell the available Offered Shares within 30
         days after the delivery of such Notice of Intention on terms no more
         favorable to a third party than those presented to the non-selling
         Shareholders. If such sale does not occur, the Offered Shares shall
         again be subject to the Right of First Offer set forth in Clause 16.3.

         In the event that any of the Shareholders who are not the Selling
         Shareholder exercises their right to purchase all of the Offered Shares
         (in accordance with this Clause 16), then the Selling Shareholder shall
         sell all of the Offered Shares to such Shareholder(s), in the amounts
         set forth in the Notice of Intention, after not less than 10 business
         days and not more than 25 business days from the date of the delivery
         of the Notice of Exercise. In the event that more than one of the
         Shareholders who are not the Selling Shareholders wish to purchase the
         Offered Shares, the Offered Shares shall be allocated to such
         Shareholders on the basis of their pro rata equity interests in Newco.

         The rights and obligations of each of the Shareholders pursuant to the
         Right of First Offer provided herein shall terminate upon the date that
         the Common Shares is registered under Section 12(b) or 12(g) of the
         Exchange Act.

         At the closing of the purchase of all of the Offered Shares by the
         Shareholders who are not the Selling Shareholder (scheduled in
         accordance with Clause 16), the Selling Shareholder shall deliver
         certificates evidencing the Offered Shares being sold, duly endorsed,
         or accompanied by written instruments of transfer in form reasonably
         satisfactory to the Shareholders who are not the Selling Shareholder,
         duly executed by the Selling Shareholder, free and clear of any adverse
         claims, against payment of the purchase price therefor in cash, and
         such other customary documents as shall be necessary in connection
         therewith.

16.4     TAG ALONG RIGHTS:

         Subject to Clause 16.3, a Shareholder (the "TRANSFERRING SHAREHOLDER")
         shall not Transfer (either directly or indirectly), in any one
         transaction or series of related transactions, to any Person or group
         of Persons, any Shares, unless the terms and conditions of such
         Transfer shall include an offer to the other Shareholders (the
         "REMAINING SHAREHOLDERS"), to sell Shares at the same price and on the
         same terms and conditions as the Transferring Shareholder has agreed to
         sell its Shares (the "TAG ALONG Right").


                                       31

<PAGE>

         In the event a Transferring Shareholder proposes to Transfer any Shares
         in a transaction subject to this Clause 16.4, it shall notify, or cause
         to be notified, the Remaining Shareholders in writing of each such
         proposed Transfer. Such notice shall set forth: (i) the name of the
         transferee and the amount of Shares proposed to be transferred, (ii)
         the proposed amount and form of consideration and terms and conditions
         of payment offered by the transferee (the "TRANSFEREE TERMS") and (iii)
         that the transferee has been informed of the Tag Along Right provided
         for in this Clause 16, if such right is applicable, and the total
         number of Shares the transferee has agreed to purchase from the
         Shareholders in accordance with the terms hereof.

         The Tag Along Right may be exercised by each of the Remaining
         Shareholders by delivery of a written notice to the Transferring
         Shareholder (the "CO-SALE NOTICE") within 10 business days following
         receipt of the notice specified in the preceding subsection. The
         Co-sale Notice shall state the number of Shares owned by such Remaining
         Shareholder which the Remaining Shareholder wishes to include in such
         Transfer; provided, however, that without the written consent of the
         Transferring Shareholder, the amount of such securities belonging to
         the Remaining Shareholder included in such Transfer may not be greater
         than such Remaining Shareholder's percentage beneficial ownership of
         Common Share Equivalents multiplied by the total number of shares of
         Common Share Equivalents to be sold by both the Transferring
         Shareholder and all Remaining Shareholders. Upon receipt of a Co-sale
         Notice, the Transferring Shareholder shall be obligated to transfer at
         least the entire number of Shares set forth in the Co-sale Notice to
         the transferee on the Transferee Terms; provided, however, that the
         Transferring Shareholder shall not consummate the purchase and sale of
         any Shares hereunder if the transferee does not purchase all such
         Shares specified in all Co-sale Notices. If no Co-sale Notice has been
         delivered to the Transferring Shareholder prior to the expiration of
         the 10 business day period referred to above and if the provisions of
         this Section have been complied with in all respects, the Transferring
         Shareholder shall have the right for a 45 day calendar day period to
         Transfer Shares to the transferee on the Transferee Terms without
         further notice to any other party, but after such 45-day period, no
         such Transfer may be made without again giving notice to the Remaining
         Shareholders of the proposed Transfer and complying with the
         requirements of this Clause 16.

         At the closing of any Transfer of Shares subject to this Clause 16, the
         Transferring Shareholder, and the Remaining Shareholder, in the event
         such Tag Along Right is exercised, shall deliver certificates
         evidencing such securities as have been Transferred by each, duly
         endorsed, or accompanied by written instruments of transfer in form
         reasonably satisfactory to the transferee, free and clear of any
         adverse claim, against payment of the purchase price therefor.


                                       32

<PAGE>

         Notwithstanding the foregoing, this Clause 16 shall not apply to any
         sale of Common Shares pursuant to an effective registration statement
         under the Securities Act in a bona fide public offering.

                                    CLAUSE 17

                    MATTERS REQUIRING SHAREHOLDERS' APPROVAL

17.1     In consideration of Acusphere and Elan agreeing to enter into the
         License Agreements, the Parties hereby agree that Newco shall not
         without the prior approval of the EIS Director and the Acusphere
         Directors:

         17.1.1.  make a material Newco determination outside the ordinary
                  course of business, including, among other things,
                  acquisitions or dispositions of intellectual property and
                  licenses or sublicenses as they relate to the Licensed
                  Technologies, enter into joint ventures and similar
                  arrangements as they relate to the Licensed Technologies;

         17.1.2.  issue any unissued Shares or unissued Common Share
                  Equivalents, or create or issue any new shares (including a
                  split of the Shares) or Common Share Equivalents, except as
                  expressly permitted by the Newco Bye-Laws;

         17.1.3.  alter any rights attaching to any class of share in the
                  capital of Newco or alter the Newco Bye-Laws;

         17.1.4.  consolidate, sub-divide or convert any of Newco's share
                  capital or in any way alter the rights attaching thereto;

         17.1.5.  dispose of all or substantially all of the assets of Newco;

         17.1.6.  do or permit or suffer to be done any act or thing whereby
                  Newco may be wound up (whether voluntarily or compulsorily),
                  save as otherwise expressly provided for in this Agreement;

         17.1.7.  enter into any contract or transaction except in the ordinary
                  and proper course of the Business on arm's length terms;

         17.1.8.  subject to Clause 23.13, assign, license or sub-license any of
                  the Elan Intellectual Property, Acusphere Intellectual
                  Property, Newco Intellectual Property, except in connection
                  with a commercialization agreement or manufacturing agreement
                  adopted in accordance with the provisions of the Agreement;


                                       33

<PAGE>

         17.1.9.  amend or vary the terms of the Acusphere License Agreement or
                  the Elan License Agreement;

         17.1.10  permit a person other than Newco to own a regulatory approval
                  relating to the Product(s);

         17.1.11  amend or vary the Business Plan or the Newco budget as they
                  relate to the Licensed Technologies;

         17.1.12  alter the number of Directors

         17.1.13  change the domicile of Newco from, or discontinue Newco out
                  of, Bermuda;

         17.1.14  register any Shares of Newco for public trading with any
                  governmental authority for public trading in any securities
                  market; and

         17.1.15  declare or pay any dividend or make any distribution, directly
                  or indirectly, with respect to its capital stock; or issue,
                  sell, exchange, deliver, redeem, purchase or otherwise acquire
                  or dispose of any shares of its capital stock or other
                  securities.

17.2     [CONFIDENTIAL TREATMENT REQUESTED]/*/





                                    CLAUSE 18

                                    DISPUTES

18.1     Should any dispute or difference arise between Elan and Acusphere, or
         between Elan or Acusphere and Newco or among the Newco Directors or
         Management Committee such that a majority or (if required) unanimous
         decision cannot be made, during the period that this Agreement is in
         force, then any Party may forthwith give notice to the other Parties
         that it wishes such dispute or difference to be referred to a
         designated senior officer of each of Elan and Acusphere.

18.2     In any event of a notice being served in accordance with Clause 18.1,
         each of the Participants shall within 14 days of the service of such
         notice prepare and circulate to the designated senior officer of each
         of Elan and Acusphere a memorandum or



                                       34

<PAGE>
         other form of statement setting out its position on the matter in
         dispute and its reasons for adopting that position. Each memorandum or
         statement shall be considered by the designated senior officers of each
         of Elan and Acusphere who shall endeavor to resolve the dispute using
         good faith and diligent efforts. If designated senior officers of each
         of Elan and Acusphere agree upon a resolution or disposition of the
         matter, they shall each sign a statement which sets out the terms of
         their agreement. The Participants agree that they shall exercise the
         voting rights and other powers available to them in relation to Newco
         to procure that the agreed terms are fully and promptly carried into
         effect.

18.3     In the event the designated senior officers of each of Elan and
         Acusphere are unable to resolve a dispute or difference when it is
         referred to them under Clause 18.1, within sixty (60) days, the
         following procedures shall apply:

         18.3.1   If the dispute relates to (i) the interpretation of this
                  Agreement or any other Definitive Document or the compliance
                  of the Parties with their legal obligations thereunder, (ii)
                  the interpretation or application of law, or (iii) the
                  ownership of any intellectual property, then the provisions of
                  Clause 23.8 shall govern.

         18.3.2   If the dispute does not relate to the matters described in
                  Clause 18.3.1, then the provisions of Clause 18.4 shall
                  govern.

18.4     The designated senior officers of each of Elan and Acusphere shall, if
         they are unable to resolve a dispute or difference when it is referred
         to them under Clause 18.1, within sixty (60) days of such referral,
         refer the matter to an independent expert in pharmaceutical product
         development and marketing (including clinical development and
         regulatory affairs) jointly selected by the designated senior officers
         of each of Elan and Acusphere (the "EXPERT").

         In the event the designated senior officers of each of Elan and
         Acusphere cannot agree upon the designation of the Expert, the
         Participants shall request the American Arbitration Association
         ("AAA"), sitting in the City of New York to select the Expert. In each
         case, the Expert shall be selected having regard to his suitability to
         determine the particular dispute or difference on which the Expert is
         being requested to determine. Unless otherwise agreed between the
         designated senior officers of each of Elan and Acusphere, the following
         rules shall apply to the appointment of the Expert. The fees of the AAA
         and the Expert shall be shared equally by the Participants. The Expert
         shall be entitled to inspect and examine all documentation and any
         other material which the Expert may consider to be relevant to the
         dispute. The Expert shall afford each Party a reasonable opportunity
         (in writing or orally) of stating reasons in support of such
         contentions as each Party may wish to make relative to the matters
         under consideration. The Expert shall give notice in writing of his
         determination to the Parties within such time as may


                                       35


<PAGE>

         be stipulated in his terms of appointment or in the absence of such
         stipulation as soon as practicable but in any event within four weeks
         from the reference of the dispute or difference to him.

18.5     Any determination by the Expert of a dispute or difference shall not be
         binding on the Parties.

                                    CLAUSE 19

                                   TERMINATION

19.1     This Agreement shall govern the operation and existence of Newco until

         19.1.1   terminated by written agreement of all Parties hereto; or

         19.1.2   otherwise terminated in accordance with this Clause 19.

19.2     For the purpose of this Clause 19, a "RELEVANT EVENT" is committed or
         suffered by a Participant if:

         19.2.1   it commits a breach of its material obligations under this
                  Agreement or the applicable License Agreement and fails to
                  cure it within 60 days of being specifically required in
                  writing to do so by the other Participant; provided, however,
                  that if the breaching Participant has proposed a course of
                  action to cure the breach and is acting in good faith to cure
                  same but has not cured the breach by the 60th day, such period
                  shall be extended by such period as is reasonably necessary to
                  permit the breach to be cured, provided that such period shall
                  not be extended by more than 90 days, unless otherwise agreed
                  in writing by the Participants; or

         19.2.2   a distress, execution, sequestration or other process is
                  levied or enforced upon or sued out against a material part of
                  its property which is not discharged or challenged within 30
                  days; or

         19.2.3   it is unable to pay its debts in the normal course of
                  business; or

         19.2.4   it ceases wholly or substantially to carry on its business,
                  otherwise than for the purpose of a reconstruction or
                  amalgamation, without the prior written consent of the other
                  Participant (such consent not to be unreasonably withheld); or

         19.2.5   the appointment of a liquidator, receiver, administrator,
                  examiner, trustee or similar officer of such Participant or
                  over all or substantially all of its


                                       36

<PAGE>

                  assets under the law of any applicable jurisdiction, including
                  without limitation, the United States of America, Bermuda or
                  Ireland; or

         19.2.6   an application or petition for bankruptcy, corporate
                  re-organization, composition, administration, examination,
                  arrangement or any other procedure similar to any of the
                  foregoing under the law of any applicable jurisdiction,
                  including without limitation, the United States of America,
                  Bermuda or Ireland, is filed, and is not discharged within 60
                  days, or a Participant applies for or consents to the
                  appointment of a receiver, administrator, examiner or similar
                  officer of it or of all or a material part of its assets,
                  rights or revenues or the assets and/or the business of a
                  Participant are for any reason seized, confiscated or
                  condemned.

19.3     If either Participant commits or suffers a Relevant Event, the other
         Participant shall have in addition to all other legal and equitable
         rights and remedies hereunder, the right to terminate this Agreement
         upon 30 days' written notice.

19.4     In the event of a termination of the Elan License Agreement and/or the
         Acusphere License Agreement, both parties will negotiate in good faith
         to determine whether this Agreement should be terminated and if so,
         which provisions should survive termination.

19.5     The provisions of Clauses 1 (Definitions), 3 (Representations), 9
         (Ownership of Intellectual Property), 10.11 and 10.12 (Intellectual
         Property Rights), 11.3, 12.3, 12.5, 12.6 (Regulatory Approval), 16
         (Transfer Restrictions), 17 (Shareholders' Veto Rights), 18 (Disputes),
         19 (Termination), 20 (Share Rights), 21 (Confidentiality), 22.2 (Costs)
         and 23 (General) shall survive the termination of this Agreement under
         this Clause 19; all other terms and provisions of this Agreement shall
         cease to have effect and be null and void upon the termination of this
         Agreement.

                                    CLAUSE 20

                                  SHARE RIGHTS

The provisions regulating the rights and obligations attaching to the Common
Shares and the Preferred Shares are set out in the Newco Bye-laws.

                                    CLAUSE 21

                                 CONFIDENTIALITY

21.1     The Parties and/or Newco acknowledge and agree that it may be
         necessary, from time to time, to disclose to each other confidential
         and/or proprietary information,


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<PAGE>
         including without limitation, inventions, works of authorship, trade
         secrets, specifications, designs, data, know-how and other information,
         relating to the Field, the Products, present or future products, the
         Newco Intellectual Property, the Elan Intellectual Property or the
         Acusphere Intellectual Property, as the case may be, methods,
         compounds, research projects, work in process, services, sales
         suppliers, customers, employees and/or business of the disclosing
         Party, whether in oral, written, graphic or electronic form
         (collectively "CONFIDENTIAL INFORMATION").

21.2     Any Confidential Information revealed by a Party to another Party shall
         be maintained as confidential and shall be used by the receiving Party
         exclusively for the purposes of fulfilling the receiving Party's rights
         and obligations under this Agreement, and for no other purpose.
         Confidential Information shall not include:

         21.2.1   information that is generally available to the public;

         21.2.2   information that is made public by the disclosing Party;

         21.2.3   information that is independently developed by the receiving
                  Party, as evidenced by such Party's records, without the aid,
                  application or use of the disclosing Party's Confidential
                  Information;

         21.2.4   information that is published or otherwise becomes part of the
                  public domain without any disclosure by the receiving Party,
                  or on the part of the receiving Party's directors, officers,
                  agents, representatives or employees;

         21.2.5   information that becomes available to the receiving Party on a
                  non-confidential basis, whether directly or indirectly, from a
                  source other than the disclosing Party, which source did not
                  acquire this information on a confidential basis; or

         21.2.6   information which was already in the possession of the
                  receiving Party at the time of receiving such information, as
                  evidenced by its records, provided such information was not
                  previously provided to the receiving party from a source which
                  was under an obligation to keep such information confidential;
                  or

         21.2.7   information that is the subject of a written permission to
                  disclose, without restriction or limitation, by the disclosing
                  Party.

21.3     The receiving Party will be entitled to disclose Confidential
         Information which the receiving Party is required to disclose pursuant
         to:


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<PAGE>
         21.3.1   a valid order of a court or other governmental body or any
                  political subdivision thereof or as otherwise required by law,
                  rule or regulation; or; or

         21.3.2   any other requirement of law;

                  provided, however, that if the receiving Party becomes legally
                  required to disclose any Confidential Information, the
                  receiving Party shall give the disclosing Party prompt notice
                  of such fact so that the disclosing Party may obtain a
                  protective order or confidential treatment or other
                  appropriate remedy concerning any such disclosure. The
                  receiving Party shall fully co-operate with the disclosing
                  Party in connection with the disclosing Party's efforts to
                  obtain any such order or other remedy. If any such order or
                  other remedy does not fully preclude disclosure, the receiving
                  Party shall make such disclosure only to the extent that such
                  disclosure is legally required.

21.4     Each Party agrees to disclose Confidential Information of another Party
         only to those employees, representatives and agents requiring knowledge
         thereof in connection with their duties directly related to the
         fulfilling of the Party's obligations under this Agreement, so long as
         such persons are under an obligation of confidentiality no less
         stringent than as set forth herein. Each Party further agrees to inform
         all such employees, representatives and agents of the confidentiality
         terms and provisions of this Agreement and their duties hereunder and
         to obtain their consent hereto as a condition of receiving Confidential
         Information. Each Party agrees that it will exercise the same degree of
         care and protection to preserve the proprietary and confidential nature
         of the Confidential Information disclosed by a Party, as the receiving
         Party would exercise to preserve its own Confidential Information. Each
         Party agrees that it will, upon request of another Party, return all
         documents and any copies thereof containing Confidential Information
         belonging to or disclosed by such other Party (except to the extent
         such Confidential Information is required to exercise a Party's rights
         under this Agreement or License Agreements). Each Party shall promptly
         notify the other Parties upon discovery of any unauthorized use or
         disclosure of the other Parties' Confidential Information.

21.5     Notwithstanding the above, each Party may use or disclose Confidential
         Information disclosed to it by another Party to the extent such use or
         disclosure is reasonably necessary in filing or prosecuting patent
         applications, prosecuting or defending litigation, complying with
         patent applications, prosecuting or defending litigation, complying
         with applicable governmental regulations or otherwise submitting
         information to tax or other governmental authorities, conducting
         clinical trials, or granting a permitted sub-license or otherwise
         exercising its rights hereunder; provided, that if a Party is required
         to make any such disclosure of the other Party's Confidential
         Information, other than pursuant to a confidentiality



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<PAGE>

         agreement, such Party shall inform the third party recipient of the
         terms and provisions of this Agreement and their duties hereunder and
         shall obtain their consent hereto as a condition of releasing to the
         third party recipient the Confidential Information.

21.6     Any breach of this Clause 21 by any employee, representative or agent
         of a Party is considered a breach by the Party itself.

21.7     The provisions relating to confidentiality in this Clause 21 shall
         remain in effect during the Term and for a period of seven years
         following the termination of this Agreement.

21.8     The Parties agree that the obligations of this Clause 21 are necessary
         and reasonable in order to protect the Parties' respective businesses,
         and each Party expressly agrees that monetary damages would be
         inadequate to compensate a Party for any breach by the other Party of
         its covenants and agreements set forth herein. Accordingly, the Parties
         agree and acknowledge that any such violation or threatened violation
         will cause irreparable injury to a Party and that, in addition to any
         other remedies that may be available, in law or in equity or otherwise,
         any Party shall be entitled to obtain injunctive relief against the
         threatened breach of the provisions of this Clause 21, or a
         continuation of any such breach by the other Party, specific
         performance and other equitable relief to redress such breach together
         with its damages and reasonable counsel fees and expenses to enforce
         its rights hereunder, without the necessity of proving actual or
         express damages.

                                    CLAUSE 22

                                      COSTS

22.1     Each Shareholder shall bear its own legal and other costs incurred in
         relation to preparing and concluding this Agreement and the Definitive
         Documents.

22.2     All other costs, legal fees, registration fees and other expenses
         relating to the incorporation of Newco, shall be borne by Newco.

                                    CLAUSE 23

                                     GENERAL

23.1     GOOD FAITH:

         Each of the Parties hereto undertakes with the others to do all things
         reasonably within its power that are necessary or desirable to give
         effect to the spirit and intent of this Agreement.


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<PAGE>

23.2     FURTHER ASSURANCE:

         At the request of any of the Parties, the other Party or Parties shall
         (and shall use reasonable efforts to procure that any other necessary
         parties shall) execute and perform all such documents, acts and things
         as may reasonably be required subsequent to the signing of this
         Agreement for assuring to or vesting in the requesting Party the full
         benefit of the terms hereof.

23.3     NO REPRESENTATION:

         Each of the Parties hereto hereby acknowledges that in entering into
         this Agreement it has not relied on any representation or warranty
         except as expressly set forth herein or in any document referred to
         herein.

23.4     FORCE MAJEURE:

         Neither Party to this Agreement shall be liable for delay in the
         performance of any of its obligations hereunder if such delay is caused
         by or results from causes beyond its reasonable control, including
         without limitation, acts of God, fires, strikes, acts of war (whether
         war be declared or not), insurrections, riots, civil commotions,
         strikes, lockouts or other labor disturbances or intervention of any
         relevant government authority, but any such delay or failure shall be
         remedied by such Party as soon as practicable.

23.5     RELATIONSHIP OF THE PARTIES:

         Nothing contained in this Agreement is intended or is to be construed
         to constitute Elan/EIS and Acusphere as partners, or Elan/EIS as an
         employee or agent of Acusphere, or Acusphere as an employee or agent of
         Elan/EIS.

         No Party hereto shall have any express or implied right or authority to
         assume or create any obligations on behalf of or in the name of another
         Party or to bind another Party to any contract, agreement or
         undertaking with any third party.

23.6     COUNTERPARTS:

         This Agreement may be executed in any number of counterparts, each of
         which when so executed shall be deemed to be an original and all of
         which when taken together shall constitute this Agreement.



                                       41


<PAGE>

23.7     NOTICES:

         Any notice to be given under this Agreement shall be sent in writing by
         registered or recorded delivery post or reputable overnight courier
         such as Federal Express or telecopied to:

         Elan at:

         Lincoln House, Lincoln Place
         Dublin 2, Ireland
         Attention:        Vice President & General Counsel
                           Elan Pharmaceutical Technologies,
                           a division of Elan Corporation, plc

         Telephone:        353-1-709-4000
         Fax:              353-1-709-4124

         and

         Elan International Services, Ltd.
         102 St. James Court
         Flatts, Smiths FL04
         Bermuda
         Attention:        President

         Telephone:        441-292-9169
         Fax:              441-292-2224

         Acusphere at:
         38 Sidney Street
         Cambridge, MA 02139-4169
         Attn: Chief Executive Officer

         Telephone         617-577-8800
         Fax:              617-577-0233

         with a copy to:

         Lawrence S. Wittenberg
         Testa, Hurwitz & Thibeault, LLP
         123 High Street
         Boston, Massachusetts 02110

         Telephone:        617-248-7000
         Fax:              617-248-7100



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<PAGE>

         Newco at:

         Clarendon House,
         2 Church St.,
         Hamilton,
         Bermuda
         Attention:        Secretary
         Telephone:        441 292 9169
         Fax:              441 292 2224

         with a copy to EIS if the notice is served by Acusphere and a copy to
         Acusphere if a notice is served by EIS or Elan,

         or to such other address(es) as may from time to time be notified by
         any Party to the others hereunder.

         Any notice sent by mail shall be deemed to have been delivered within
         three Business Days after dispatch or delivery to the relevant courier
         and any notice sent by telecopy shall be deemed to have been delivered
         upon confirmation of receipt. Notices of change of address shall be
         effective upon receipt. Notices by telecopy shall also be sent by
         another method permitted hereunder.


23.8     GOVERNING LAW; [CONFIDENTIAL TREATMENT REQUESTED]/*/

         23.8.1.  This Agreement shall be governed by and construed in
                  accordance with the laws of the State of New York.

         23.8.2   In the event that a dispute regarding the matters described in
                  Clause 18.3.1 is not resolved pursuant to the provisions of
                  Clause 18.1, the Parties agree to consider other dispute
                  resolution mechanisms including mediation.

         23.8.3   In the event that the Parties fail to agree on a mutually
                  acceptable dispute resolution mechanism under Clause 23.8.2,
                  or in the event that the dispute is not resolved pursuant to
                  any dispute resolution mechanism agreed by the Parties under
                  Clause 23.8.2 within 6 months, the dispute shall be finally
                  settled by the courts of competent jurisdiction. For the
                  purposes of this Agreement the parties submit to the
                  [CONFIDENTIAL TREATMENT REQUESTED]/*/ jurisdiction of the
                  courts of the State of New York.

23.9     SEVERABILITY:

         If any provision in this Agreement is agreed by the Parties to be,
         deemed to be or becomes invalid, illegal, void or unenforceable under
         any law that is applicable



                                       43


<PAGE>
         hereto, such provision will be deemed amended to conform to applicable
         laws so as to be valid and enforceable or, if it cannot be so amended
         without materially altering the intention of the Parties, it will be
         deleted, with effect from the date of such agreement or such earlier
         date as the Parties may agree, and the validity, legality and
         enforceability of the remaining provisions of this Agreement shall not
         be impaired or affected in any way.

23.10    AMENDMENTS:

         No amendment, modification or addition hereto shall be effective or
         binding on any Party unless set forth in writing and executed by a duly
         authorized representative of all Parties.

23.11    WAIVER:

         No waiver of any right under this Agreement shall be deemed effective
         unless contained in a written document signed by the Party charged with
         such waiver, and no waiver of any breach or failure to perform shall be
         deemed to be a waiver of any future breach or failure to perform or of
         any other right arising under this Agreement.



23.12    ASSIGNMENT:

         None of the Parties shall be permitted to assign its rights or
         obligations hereunder without the prior written consent of the other
         Parties except as follows:

         23.12.1   Elan, EIS and/or Acusphere shall have the right to assign
                   their rights and obligations hereunder to their Affiliates
                   provided, however, that such assignment does not result in
                   adverse tax consequences for any other Parties.

         23.12.2   Elan and EIS shall have the right to assign their rights and
                   obligations hereunder to a special purpose financing or
                   similar entity established by Elan or EIS.

23.13    ASSIGNMENT OF NEWCO INTELLECTUAL PROPERTY:

         Upon one month's prior notice in writing from Elan to Newco and
         Acusphere, Newco shall assign the Newco Intellectual Property from
         Newco to a wholly-owned subsidiary of Newco to be incorporated in
         Ireland, which company shall be newly incorporated by Elan to
         facilitate such assignment.


                                       44

<PAGE>
23.14    WHOLE AGREEMENT/NO EFFECT ON OTHER AGREEMENTS:

         This Agreement (including the Schedules attached hereto) and the
         Definitive Documents set forth all of the agreements and understandings
         between the Parties with respect to the subject matter hereof, and
         supersedes and terminates all prior agreements and understandings
         between the Parties with respect to the subject matter hereof. There
         are no agreements or understandings with respect to the subject matter
         hereof, either oral or written, between the Parties other than as set
         forth in this Agreement and the Definitive Documents.

         In the event of any ambiguity or conflict arising between the terms of
         this Agreement and those of the Newco Bye-Laws the terms of this
         Agreement shall prevail, except with respect to the rights and
         obligations attaching to the Common Shares and the Preferred Shares in
         which respect the Newco Bye-Laws shall prevail.

















                                       45

<PAGE>


         No provision of this Agreement shall be construed so as to negate,
         modify or affect in any way the provisions of any other agreement
         between any of the Parties unless specifically referred to, and solely
         to the extent provided herein. In the event of a conflict between the
         provisions of this Agreement and the provisions of the License
         Agreements, the terms of this Agreement shall prevail unless this
         Agreement specifically provide otherwise.

23.15    SUCCESSORS:

         This Agreement shall be binding upon and inure to the benefit of the
         Parties hereto, their successors and permitted assigns.














                                       46

<PAGE>

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the day
first set forth above.

                                    SIGNED

                                    BY: /s/ illegible signature
                                        ---------------------------------------
                                    for and on behalf of
                                    ELAN CORPORATION, PLC
                                    (acting through its division
                                    Elan Pharmaceutical Technologies)

                                    SIGNED

                                    BY: /s/ illegible signature
                                        ---------------------------------------
                                    for and on behalf of
                                    ELAN PHARMA INTERNATIONAL LIMITED


                                    SIGNED

                                    BY: /s/ illegible signature
                                        ---------------------------------------
                                    for and on behalf of
                                    ELAN INTERNATIONAL SERVICES, LTD.


                                    SIGNED

                                    BY: /s/ Sherri Oberg
                                        ---------------------------------------
                                    for and on behalf of
                                    ACUSPHERE, INC.


                                    SIGNED

                                    BY: /s/ illegible signature
                                        ---------------------------------------
                                    for and on behalf of
                                    ACUSPHERE NEWCO, LTD.

                                       47

<PAGE>




                                   SCHEDULE 1

                             ELAN LICENSE AGREEMENT






















                                       48



<PAGE>

                                   SCHEDULE 2



                           ACUSPHERE LICENSE AGREEMENT





















                                       49