EXHIBIT 10.20


                          INTELLECTUAL PROPERTY RIGHTS
                                LICENSE AGREEMENT
                                     between
                                SURGX CORPORATION
                                   (LICENSOR)
                                       and
                              MCGRAW-EDISON COMPANY
                                   (LICENSEE)
                                Dated July_, 1996




<PAGE>


                 INTELLECTUAL PROPERTY RIGHTS LICENSE AGREEMENT

                  THIS  AGREEMENT,  is  made  on  July  ~  1996,  between  SurgX
Corporation, a Delaware corporation having its principal office at 47341 Bayside
Parkway,  Fremont,  California 94538 (hereinafter  "Licensor") and McGraw-Edison
Company, a Delaware corporation having a principal office at 114 Old State Road,
Ellisville, Missouri 63178 (hereinafter "Licensee").

                  WHEREAS,  Licensor  has been  engaged  in the  development  of
products,  with  respect  to which it is  possessed  of  proprietary  rights and
engineering  production  knowledge essential to or helpful in the manufacture of
the  Licensed  Products  as defined  herein,  and owns or has the right to grant
licenses with respect to certain  inventions,  copyrights,  and other industrial
and intellectual  property,  technical and production data, and other secret and
confidential  information  relating to the manufacture of the Licensed Products;
and

                  WHEREAS,  Licensee  desires to obtain  from  Licensor  certain
patent rights,  technical  assistance,  technical and production  know-how,  and
services  of  technical  representatives,   including  drawings,   designs,  and
specifications,  formulae, data, information and engineering assistance relating
to Licensed  Products,  to the extent the same is  possessed  by  Licensor,  and
Licensor has the right to grant the same,  to assist  Licensee in  manufacturing
and selling the Licensed Products as hereinafter set forth; and

                  WHEREAS,  Licensor  is willing to  provide  Licensee  with the
technical  assistance,  technical  and  production  know-how,  and  services  of
technical  representatives,  in  connection  with  the  manufacture  and sale of
Licensed  Products  hereunder,  to the extent and upon the terms and  conditions
hereinafter set forth.

                  NOW,  THEREFORE,  in  consideration  of the  premises  and the
mutual covenants hereinafter contained, Licensor and Licensee covenant and agree
as follows:

1. DEFINED TERMS.

                   1.1 "Affiliate" means any person  controlling,  controlled by
(either  directly  or  indirectly)  or under  common  control  with  Licensee or
Licensor as applicable.

                   1.2  "Agreement"  means  this  Intellectual  Property  Rights
License Agreement between Licensee and Licensor.

                   1.3  "Confidential  Information" has the meaning set forth in
Section 12.1.

                   1.4  "Disclosing  Party"  shall mean a Party  that  discloses
Confidential Information to the other Party.

                                                
1
                   1.5  "Gross  Profit"  means  under  United  States  generally
accepted accounting  principles:  (i) the aggregate sum of revenue recognized by
Licensee, its Affiliates and any sublicensee from sales or other dispositions of
Licensed Products to unaffiliated  third parties net of freight out, returns and
credits allowed and taken ("Net Sales");  (ii) minus Licensee's cost of sales at
standard  costs  including  direct  and  indirect  labor and  associated  fringe
benefits,  scrap, perishable tooling,  supplies and maintenance on machinery and
equipment (only costs associated with the manufacture of Licensed  Products will
be included in standard  costs);  (iii) plus or minus, as applicable,  operating
variances from standard costs of sales; (iv) minus  semi-variable costs equal to
5~o of Net Sales for  selling  commissions  and  distribution  costs;  (v) minus
amortization  associated  with  incremental  machinery and equipment used in the
manufacture  of the Licensed  Products  (using a 10 year useful life);  and (vi)
minus  amortization  associated with development  costs incurred by Licensor and
reimbursed  by  Licensee  as  described  in Section  3.3  hereof  using a 5-year
amortization period.

                   1.6  "Improvements"  shall mean those  supplements,  changes,
revisions,  updates,   advancements,   corrections,  and  modifications  to  the
Technical   Information  or  Licensed  Intellectual  Property  Rights  including
manufacturing  process improvements made during the term of this Agreement which
are necessary or useful for the manufacture, use or sale of Licensed Products.

                   1.7 "Licensee Components" means the materials, components and
processes  of  Licensee  which  are not  covered  by the  Licensed  Intellectual
Property Rights and which, in combination with the Liquid Polymer Material, form
the Licensed Products.

                   1.8 "Licensed  Intellectual Property Rights" means Licensor's
interest  in  any  patents,  patent  applications,   inventions  (including  the
inventions  and patent  applications  listed on Attachment  1.5),  the "Surging"
trademark  and  trade  name,   Technical   Information  and  copyrights   owned,
controlled, applied for or obtained by Licensor at any time before or during the
term of this  Agreement to the extent such rights are necessary or essential for
the manufacture,  use and sale of the Licensed  Products.  Wherever used in this
Agreement,  Licensed  Intellectual  Property  Rights  includes  any such  rights
relating to Improvements of Licensor.

                   1.9  "Licensed   Products"  means  discrete   components  and
connector  products  described  on  Attachment  1.6 which  utilize the  Licensed
Intellectual Property Rights and incorporate the Liquid Polymer Material.

                   1.10 "Liquid Polymer Material" means a polymeric  provided in
a solvated liquid form that can be used to provide  electrical  overstress (EOS)
or electrostatic  discharge (ESD) protection for integrated circuits (IC's). The
Liquid Polymer material can be applied between signal lines and the ground plane
of an electrical board assembly, a connector and other applications where it can
be positioned between signal lines and ground. The Liquid Polymer material has a
high impedance, and low leakage state during normal circuit operation. During an
EOS or an ESD event,  the Liquid Polymer material has a low impedance state that
shunts the offending  charge to the ground plane. The capacitance of the devices
using Liquid Polymer Material is typically less than 1 picofarad. The mechanical
flexibility  and  the  semiconducting  characteristics  of  the  Liquid  Polymer
material  allow for a wide variety of packaging  concepts,  including  arrays in
which a common ground is used with  multiple  signal  lines.  Specifically,  the
Liquid  Polymer  material  is  covered  by the  patent  applications  listed  on
Attachment  1.5. The Liquid Polymer  material shall  specifically  exclude other
SurgX products,  such as, without limitation,  the family of products identified
by Licensor as SurgTape, SurgX Epoxy Packages, or custom SurgX applications such
as a layer in a panted  circuit  board and  novel  packaging,  including  hybrid
designs and multichip modules.

                   1.11 "Minimum Annual Royalties" has the meaning set forth in 
Section 5.2.

                   1.12 "Parties" shall mean McGraw-Edison Company and SurgX 
Corporation.

                   1.13 "Receiving Party" has the meaning set forth in Section 
12.2.

                   1.14  "Royalty  Year"  means a period  of 12  months  used to
measure the royalties  payable to Licensor.  The "First  Royalty Year" is the 12
month period which commences on the first day of the month in which the Licensee
makes its initial sale of the Licensed  Products,  the "Second  Royalty Year" is
the 12 month period which immediately follows the "First Royalty Year", etc.

                   1.15 "Technical  Assistance"  means providing the appropriate
Licensor  personnel to assist  personnel of Licensee in becoming  trained in the
use of Technical Information to be delivered or provided hereunder to the extent
such Technical Information is necessary or essential for the manufacture, use or
sale of Licensed Products and Improvements thereto.

                   1.16 "Technical  Information" means trade secrets,  know-how,
drawings,  designs,  specifications  and  industrial,  commercial and scientific
information  controlled  by  Licensor  and  disclosed  to  Licensee  under  this
Agreement.  Whenever used in this Agreement,  Technical Information includes any
information relating to Improvements of Licensor.

                   1.17 "Territory" means worldwide.

2. GRANT OF LICENSE.

                  2.1  Licensor  grants  to  Licensee  a  license,   within  the
Territory,  to use (i) the Licensed  Intellectual  Property Rights; and (ii) the
Technical  Information  solely to manufacture,  use, and sell Licensed Products;
provided, however, that, except as provided in Section 11 hereof,  Licensee
shall have no right to  manufacture  the Liquid Polymer Material.

                  2.2  Subject to Section 5.2  hereof,  the  license  granted to
Licensee under the terms of this Agreement is an exclusive  license with respect
to the manufacture,  use and sale of Licensed  Products for a period of 10 years
commencing  on the first day of the month in which  Licensee  makes its  initial
sale of the Licensed  Products,  but in no event shall the period of exclusivity
extend  beyond  a date  which  is 12 years  after  the  date of this  Agreement.
Thereafter  the  license  granted to  Licensee  hereunder  shall  continue  on a
nonexclusive basis. Notwithstanding the foregoing, Licensee will permit Licensor
to grant a nonexclusive license to Iriso Electronics  Company,  Ltd., a Japanese
corporation  ("Iriso")  allowing  Iriso  to  manufacture,  use and sell in Japan
products  incorporating the Licensed Intellectual Property Rights and to utilize
the Technical  Information,  provided that Iriso shall have no right to sell any
such products (a) outside of Japan or (b) to a  distributor  that would sell any
such products outside of Japan.  However,  Licensor may grant Iriso the right to
sell any such  products to an  original  equipment  manufacturer  or to an added
value reseller in Japan that may  incorporate  any such products into goods that
are sold outside of Japan.

                  2.3 Licensee is not  authorized  to grant a sublicense  to any
third party without Licensor's prior written consent;  provided,  however,  that
Licensee may grant a sublicense to any of its  Affiliates  without prior written
consent. No Affiliate or sublicensee may be granted a sublicense pursuant to the
terms of this  Agreement  unless it shall  first agree in writing to be bound by
all of the terms of this  Agreement.  The revenues and costs of any Affiliate or
sublicensee,  directly related to any sublicense  granted  hereunder and falling
within the definition of Gross Profit, shall be aggregated with the revenues and
costs of  Licensee  for the  purpose of  determining  the  royalties  payable to
Licensor pursuant to Section 5.1 hereof.

3. DEVELOPMENT AND COMMERCIALIZATION OF THE LICENSED PRODUCTS AND PRODUCT 
   MODIFICATIONS.

                  3.1 In  consideration  for  granting  the  license to Licensee
hereunder and the development of the Licensed Products and product modifications
and  enhancements  as described in this Section 3, Licensee has previously  paid
Licensor  $100,000.  In  addition,  Licensee  shall pay  Licensor an  additional
$650,000 by check delivered by courier next day delivery  contemporaneously with
the execution and delivery of this Agreement by both Parties.

                  3.2 Upon  execution  of the  Agreement  both  Parties will use
their good faith reasonable  efforts to develop the Licensed  Products and bring
them to commercialization as soon as feasible. In connection therewith, Licensor
will provide Licensee with the following:

                           3.2.1  During the term of this  Agreement,  Training,
Technical  Information  and Technical  Assistance  required to allow Licensee to
manufacture the Licensed Products in its facilities;

                           3.2.2 As soon as reasonably  possible, a final report
documenting all processing requirements and procedures necessary for Licensee to
manufacture the Licensed Products; and

                           3.2.3 As soon as reasonably possible,  the technology
necessary to improve the Licensed  Products for broader  product  application as
follows:

                                            (a) Trigger voltage = 200 V.
                                            (b) Clamping voltage = 25 V.

- 3.3 To the extent that Licensor  specifically  undertakes any Licensed Product
modifications  or  enhancements  at Licensee's  written  request (other than-the
product  modifications  and enhancements  described in Section 3.2.3 above which
will be undertaken by Licensor at its sole expense),  Licensee  shall  reimburse
Licensor  for its  development  costs  as  described  below in  conducting  such
modifications or enhancements,  including any additional  capital equipment that
Licensee  requires  to  perform  such   modifications   and  enhancements.   The
development  costs  incurred  by  Licensor to be  reimbursed  by Licensee  shall
consist  of  direct  and  indirect  labor  and  associated  fringe  benefits  of
Licensor's  employees and  independent  contractors as allocated to the project,
scrap,  perishable  tooling,  supplies,  maintenance on machinery and equipment,
capital equipment costs,  material costs and travel costs. The development costs
incurred  by  Licensor  will be  amortized  over a period of 5 years and capital
equipment  cost incurred by Licensee will be amortized over a period of 10 years
and the  annual  amortization  will be  included  in the cost  structure  of the
Licensed Products for the purpose of determining annual royalties based on Gross
Profits (or if annual  royalties are based on net sales,  the royalties based on
net sales  will be  reduced by an  equivalent  amount to account  for the annual
amortization).

                  3.4 All inventions or other intellectual property conceived or
reduced to practice  jointly by the employees or independent  contractors of the
Parties,  as a  result  of  this  collaboration  and  during  the  term  of this
Agreement,  shall be jointly  owned by the  Parties and shall be included in the
license  without  charge to Licensee.  Licensee  shall not grant a sublicense in
such jointly owned inventions or intellectual property without the prior written
consent of Licensor.

                  3.5 Licensee  shall  utilize the SurgX trade name or trademark
in connection with the sale and promotion of the Licensed Products. Licensee may
also utilize its trade names or trademarks in  conjunction  with the SurgX trade
name or  trademark  in  connection  with the sale and  promotion of the Licensed
Products.  Licensor and Licensee shall enter into a Trademark  License Agreement
in the form attached hereto as Attachment 3.5.

4. DISCLOSURE OF TECHNICAL INFORMATION.

                  4.1  Licensor  shall  disclose  and  furnish to  Licensee  all
Technical  Information  necessary or essential for the  incorporation and use of
Liquid  Polymer  Material  in the  manufacture,  use and  sale  of the  Licensed
Products.  Disclosure  of Technical  Information,  to the extent such  Technical
Information is in documentary or fixed form,  shall be by delivery of two copies
of the most recent versions thereof.  Delivery of Technical Information shall be
completed in compliance with the schedule of Attachment 4.1.

                  4.2 To the extent that Technical  Information is not available
in  documentary  or fixed form,  disclosure  shall be made by  Licensor,  at its
expense,  providing  Technical  Assistance to Licensee,  including  training and
consultation  normally  sufficient  to  demonstrate  the  practical  use  of the
Technical Information, and to communicate information applicable thereto in such
detail as to reasonably  permit Licensee to understand and make full use thereof
in the  establishment  and  operation  of a production  capability  for Licensed
Products, and to exercise the rights and licenses granted herein. Such Technical
Assistance  will be performed at the request of  Licensee,  consistent  with the
Technical Information delivery schedule of Attachment 4.1, by qualified Licensor
technical personnel,  at Licensee's  manufacturing plants and locations.  During
such visits,  Licensor personnel shall observe such rules and regulations as are
applicable to employees of Licensee,  and Licensor shall indemnify Licensee from
any liability which might be asserted or claimed against  Licensee,  arising out
of said visits by Licensor's personnel, including personal injury to or property
damage caused by such personnel.  Licensee will provide, at no cost to Licensor,
reasonable  facilities  for such  training and Technical  Assistance,  including
access to office  space,  secretarial  support and local phone use for  Licensor
personnel  engaged in such  training and Technical  Assistance.  Notwithstanding
Section 2.3 hereof,  Licensee may not  sublicense  the rights  contained in this
Section 4.2 without the specific prior written approval of Licensor.

                  4.3  By  arrangement  with  Licensor,  Licensee  may,  at  its
expense,  send qualified personnel to Licensor's  establishment for training for
the purpose of enabling  Licensor to  demonstrate  and  Licensee's  employees to
observe,  the manufacturing  and engineering  operations and the application and
use of Technical Information  pertaining to the Licensed Products.  The identity
and number of any such  personnel,  and the date and duration of each such visit
shall be such as Licensor  and  Licensee  mutually  agree.  During such  visits,
Licensee's  personnel shall observe such rules and regulations as are applicable
to  employees  of  Licensor,  and Licensee  shall  indemnify  Licensor  from any
liability  which might be asserted or claimed  against  Licensor  arising out of
said visits by Licensee's  personnel,  including  personal injury to or property
damage caused by such personnel.  Licensor will provide, at no cost to Licensee,
reasonable  facilities  for such  training,  including  access to office  space,
secretarial support and local phone use for Licensee's personnel engaged in such
training.

                  4.4 After  delivery of the Technical  Information  pursuant to
Attachment  4.1,  Licensee's  personnel may direct  correspondence  or telephone
inquiries to Licensor's

personnel  requesting  reasonable  amounts  of  Technical  Assistance  and  oral
explanation concerning Licensor's method of manufacturing, Technical Information
or operation of the Licensed  Products,  and Licensor agrees to promptly respond
to such  inquiries  and to supply  such  assistance  to the  extent it is in the
possession of, or known to, Licensor,  and at the place and times upon which the
Parties may mutually agree.

                  4.5 Licensor  agrees to promptly notify Licensee of any defect
or error discovered in the Technical Information,  and of any corrective action,
revisions or customer notice made by Licensor with regard thereto.

                  4.6 During the term of this Agreement, Licensor shall promptly
disclose  and  deliver to  Licensee  any  Improvements  conceived  or reduced to
practice  in whole or in part by  Licensor.  Licensor  also  agrees to  promptly
deliver   sufficient   information  to  allow   Licensee  to  incorporate   such
Improvements  into the  Licensed  Products.  During the term of this  Agreement,
Licensee  shall  promptly  deliver to Licensor  any  Improvements  conceived  or
reduced to practice  in whole or in part by  Licensee.  Licensee  also agrees to
promptly  deliver  sufficient  information to allow Licensor to incorporate such
Improvements into the Licensed Products.

5. ROYALTIES.

                  5.1 Commencing with the First Royalty Year, Licensee shall pay
to Licensor an annual royalty for the license granted herein equal to 25% of the
Gross Profit  recognized by Licensee,  its Affiliates and any sublicensee on the
sale of  Licensed  Products  during  the  relevant  Royalty  Year.  The  Parties
acknowledge  that it is their  desire to  ultimately  convert  this royalty to a
royalty based upon net sales of the Licensed  Products (instead of Gross Profit)
but  they  do  not  have  sufficient   experience  to  currently  calculate  the
appropriate royalty rate. Therefore, the Parties agree that after two years from
the date of this  Agreement,  they shall  discuss  in good faith a royalty  rate
based on net sales which provides the same economic  allocation as that intended
by the royalty  based on Gross  Profit.  Unless both  Parties  execute a written
amendment to this Agreement  setting forth the terms of the royalty based on net
sales,  any promises,  agreements or  understandings  made by the Parties during
their  discussions and negotiations  will not be binding on the Parties.  If the
Parties do not execute a written  amendment to this Agreement  setting forth the
terms of the royalty  based on net sales,  then Licensee  shall  continue to pay
Licensor an annual royalty based on Gross Profit as described above.

                  5.2 In order to maintain the  exclusive  nature of the license
for the 10 year  exclusivity  period  described in Section 2.2,  Licensee  shall
insure  that the  annual  royalties  payable  to  Licensor  are no less than the
following amounts ("Minimum Annual Royalties"):

Royalty Year                                    Minimum Annual Royalties
1st                                                       $0
2nd                                                 $200,000
3rd                                                 $500,000
4th-5th                                           $1,000,000 (each Royalty Year)
6th-lOth                                          $2,500,000 (each Royalty Year)

If in any Royalty Year,  the royalties  based on Gross Profit (or net sales,  if
applicable) are less than the Minimum Annual Royalties, Licensee, at its option,
has the  right to pay up the  difference  to a total  equalling  the  respective
year's Minimum Annual  Royalty.  If Licensee elects not to pay up the difference
to a total  equalling the respective  year's Minimum  Annual  Royalty,  then the
license granted hereunder shall become a non-exclusive license for the remaining
term of this  Agreement  subject to the rights of the Licensor to terminate this
Agreement as set forth in Section  14.4.  In the event the license  reverts to a
nonexclusive  license  because  Licensee  elects not to pay the  Minimum  Annual
Royalties,  the Licensee shall no longer be liable for payment of Minimum Annual
Royalties  but shall  continue  to be liable  for  royalties  based on the Gross
Profit (or net sales, if applicable) of Licensed Products sold.

                  5.3 As a matter of convenience, to protect Licensor's Licensed
Intellectual  Property  Rights and as an  acknowledgment  that  Licensee  is not
currently in the business of producing any  resettable  electrostatic  discharge
protection  products  or products  incorporating  any  resettable  electrostatic
discharge  protection  products,  Licensee  agrees that the  royalty  under this
Section  5 shall  apply to all  resettable  electrostatic  discharge  protection
products which are covered by (a) the Licensed  Intellectual  Property Rights or
(b) Improvements of Licensee.

                  5.4 Subject to Section 5.3, nothing in this Agreement shall be
deemed to prohibit Licensee from conceiving,  reducing to practice,  developing,
making,  using,  marketing  or  otherwise  distributing  or  promoting  products
competitive  with  the  Licensed  Products  produced  hereunder,  provided  that
Licensee  does not breach any  provision of Section 12 or disparage the Licensed
Products produced hereunder in doing so.

6. PAYMENTS.

                  6.1 Royalties (including Minimum Annual Royalties) are due and
payable for each  quarter of each Royalty Year within 45 days after each quarter
of each such Royalty Year.

                  6.2 All payments payable by Licensee to Licensor shall be paid
in U.S. dollars to Licensor at the address set out in Section 19.

7. RECORDS. REPORTS AND INSPECTION.

                  7.1  Licensee  shall at all times  keep  complete  and  proper
records of all Licensed  Products  manufactured,  used or sold by Licensee,  its
Affiliates and any sublicensee.

Sales or dispositions  shall be considered as made on the date of the invoice or
shipment, whichever occurs first.

                  7.2  Within 45 days after each  quarter of each  Royalty  Year
during  the term of this  Agreement,  Licensee  shall  send to  Licensor  a full
statement in writing  identifying  separately the total number of pieces in each
product category of Licensed  Products sold by Licensee,  its Affiliates and any
sublicensee  during the preceding quarter of such Royalty Year,  together with a
computation of royalties due Licensor.

                  7.3  Licensor  shall have the right,  upon  giving at least 30
days' advance  notice,  at any time during normal  business  hours, to audit the
records of Licensee,  any  sublicensee  and any Affiliate to which  Licensee has
granted a  sublicense  by having an  independent  auditor  examine the books and
records of Licensee,  any  sublicensee  and any Affiliate to which  Licensee has
granted a sublicense  relating to the  computation  of royalties on the Licensed
Products.  Licensee,  any  sublicensee  and any Affiliate to which  Licensee has
granted a sublicense  shall keep the records  available for inspection for three
years after expiration of the Royalty Year in which they are made and Licensor's
right to audit the records of Licensee,  any  sublicensee  and any  Affiliate to
which Licensee has granted a sublicense  shall not extend beyond such three year
period. Licensor shall, and shall cause its independent auditor to, maintain the
confidentiality  of all  information,  books and  records  examined  during such
audit.  Licensor  will bear the expense of any such audit unless the audit shows
an  underpayment  of more  than 5% for the  applicable  period,  in  which  case
Licensee shall bear the expense of the audit.

8. WARRANTY.

                  8.1  Licensor  warrants  that it has the  right to  grant  the
rights  licensed  hereunder and there are no  outstanding  assignments,  grants,
licenses, encumbrances or obligations inconsistent with this Agreement.

                  8.2 To the knowledge of Licensor and its Affiliates,  Licensor
warrants that the Licensed  Intellectual  Property Rights do not interfere with,
infringe  upon,  misappropriate  or  otherwise  conflict  with any  intellectual
property  rights of third  parties and  Licensor and its  Affiliates  have never
received any charge, complaint,  claim or notice alleging any such interference,
infringement,  misappropriation  or violation.  To the knowledge of Licensor and
its   Affiliates,   no  third  party  has  interfered   with,   infringed  upon,
misappropriated  or  otherwise  come  into  conflict  with  any of the  Licensed
Intellectual Property Rights.

9 INDEMNIFICATION.

                   9.1  Licensor  agrees  to  indemnify  Licensee,  its  agents,
employees,  officers,  directors  and  representatives  (the  "Licensee  Group")
against  any and all losses  and  expenses  arising  from any  claims,  demands,
actions, suits, or prosecution  (collectively,  a "Claim") that may be initiated
against  the  Licensee  Group  by  an  unaffiliated   third  party  relating  to
infringement  claims  (specifically  including  claims  that may arise  from the
patents  described in Attachment  9.1 hereof) which are the result of the Liquid
Polymer  Material or the  incorporation  or  combination  of the Liquid  Polymer
Material with Licensee Components in the Licensed Products manufactured, used or
sold by  Licensee  in the  Territory  pursuant  to the terms of this  Agreement.
Licensor  will have no such  obligation  (i) unless it is  promptly  notified by
Licensee  of any Claim or threat of a Claim  provided,  however,  that  delay or
failure to so notify  shall not relieve  Licensor of its  indemnity  obligations
unless  and  to the  extent  Licensor  is  thereby  damaged,  (ii)  unless  upon
Licensor's  request and  expense,  Licensee  cooperates  reasonably  in any such
Claim,  (iii) to the  extent  the  Claim  involves  specifications  provided  by
Licensee  or  any  change  or  addition  to or  modification  of  such  Licensed
Intellectual  Property Rights or any use or application  thereof  different from
the  commercial  uses  and  applications  of  Licensor  as of the  date  of this
Agreement  or (iv) for any  settlement  Licensor  does not approve in advance in
writing.  Licensee,  at its sole cost and expense, may elect to join Licensor to
defend such Claim so long as Licensee is an exclusive licensee hereunder. If any
resolution  of such a Claim results in the payment of a royalty by Licensee to a
third party as necessary to make, use, or sell Licensed  Products,  such royalty
shall be allocated  to Gross  Profit to the extent such  royalty  accrues on the
manufacture,  use or sale of the Licensed Products (or if royalties are based on
net sales rather than Gross Profit,  25% of such third party  royalties shall be
deducted from and credited against any royalties otherwise due to Licensor under
this Agreement).

                  9.2  Licensee  agrees  to  indemnify  Licensor,   its  agents,
employees,  officers,  directors  and  representatives  (the  "Licensor  Group")
against  any and all losses  and  expenses  arising  from any  claims,  demands,
actions,  suits or prosecution  (collectively,  a "Claim") that may be initiated
against  the  Licensor  Group  by  an  unaffiliated   third  party  relating  to
infringement  claims  which  are the  result  of the  use or  sale  of  Licensee
Components which are incorporated in the Licensed Products manufactured, used or
sold by  Licensee  in the  Territory  pursuant  to the terms of this  Agreement.
Licensee  will have no such  obligation  (i) unless it is  promptly  notified by
Licensor  of any Claim or threat of a Claim  provided,  however,  that  delay or
failure to so notify  shall not relieve  Licensee of its  indemnity  obligations
unless  and  to the  extent  Licensee  is  thereby  damaged,  (ii)  unless  upon
Licensee's request and expense Licensor cooperates  reasonably in any such Claim
and (iii) for any  settlement  Licensee  does not approve in advance in writing.
Licensor,  at its sole cost and  expense,  may elect to join  Licensee to defend
such  Claim.  If any  resolution  of such a Claim  results  in the  payment of a
royalty by Licensor to a third party as necessary to make,  use or sell Licensed
Products (other than the patent rights specified in Attachment 1.5 to the extent
such patent  rights are  incorporated  in the Licensed  Products),  such royalty
shall be allocated  to Gross  Profit to the extent such  royalty  accrues on the
manufacture,  use or sale of the Licensed Products (or if royalties are based on
net sales rather than Gross Profit,  25% of such third party  royalties shall be
deducted from and credited against any royalties otherwise due to Licensor under
this Agreement).

10. IMPROVEMENTS.

                   10.1 Licensor agrees to disclose to Licensee any Improvements
made  by  Licensor  relating  to  the  Licensed   Intellectual  Property  Rights
developed,  conceived or reduced to practice by Licensor during the term of this
Agreement  and to  grant  Licensee  the  right  to use the  Improvements  in the
manufacture,  use and sale of the Licensed  Products at no additional cost under
the same terms and conditions of this Agreement for the term of this Agreement.

                   10.2 Licensee agrees to disclose to Licensor any Improvements
made by Licensee,  its  Affiliates or any  sublicensee  relating to the Licensed
Intellectual  Property  Rights  developed,  conceived  or reduced to practice by
Licensee  during the term of this  Agreement and to grant  Licensor a worldwide,
royalty-free license to any such Improvements for the term of this Agreement. To
the extent that any such  Improvement  as made by  Licensee  can only be used or
sold with reference to the Licensed Products or such Improvement  constitutes an
enhancement or improvement to the Liquid Polymer  Material,  Licensor shall have
the full right to sublicense  such  Improvement.  Conversely,  to the extent any
such Improvement has uses both with reference to the Licensed Products and other
products of Licensee,  Licensor shall have no right to sublicense  such Licensee
Improvement without the prior written consent of Licensee.

11. MANUFACTURE AND SUPPLY OF LIQUID POLYMER MATERIAL.

                   11.1  Pursuant  to the  terms  of a  Supply  Agreement  to be
negotiated and entered into by the Parties, Licensor shall manufacture,  or have
manufactured  for it, and shall sell to Licensee  all of  Licensee's  forecasted
requirements for the Liquid Polymer Material at a price equal to Licensor's cost
for such  material as defined on  Attachment  11.1. In the event the Parties are
unable in good faith to negotiate and enter into a Supply  Agreement,  the terms
and conditions of the supply arrangement will be governed by this Section 11. At
least four months prior to each delivery date, Licensee shall deliver a forecast
to Licensor of Licensee's quantity requirements for the Liquid Polymer Material.
Licensee shall act in a  commercially  reasonable  manner to schedule  orders to
avoid creating  production  capacity  problems for Licensor.  The Liquid Polymer
Material delivered to Licensee shall be F.O.B. Licensee's manufacturing facility
in the  Continental  United States.  Licensor  shall use  reasonable  commercial
efforts to deliver the Liquid Polymer Material by the applicable  delivery date.
All customs, duties, costs, taxes, insurance premiums and other expenses related
to transportation and delivery shall be at Licensee's  expense.  Licensor agrees
to deliver Liquid  Polymer  Material to Licensee in conformity  with  Licensee's
forecast,  free of material  and  workmanship  defects and meeting the  Parties'
mutually agreed upon quality control requirements.

11.2  Licensee  shall have the right,  upon  giving at least  thirty  (30) days'
advance notice,  at any time during normal  business hours, to audit  Licensor's
records  by having an  independent  auditor  examine  the books and  records  of
Licensor  relating to the cost of the Liquid  Polymer  Material.  Licensor shall
keep the records  available  for  inspection  for three years after each date of
delivery of the Liquid Polymer Material and Licensee's right to audit Licensor's
records  shall not extend  beyond such three year period.  Licensee  shall,  and
shall cause its  independent  auditor to,  maintain the  confidentiality  of all
information,  books and records examined during such audit.  Licensee shall bear
the expense of any such audit unless the audit shows an overpayment of more than
5% for the applicable  period, in which case Licensor shall bear the cost of the
audit.

                   11.3 Licensee  shall have the right to  self-manufacture  the
Liquid  Polymer  Material  i(pound) (i) Licensor  fails to meet its  obligations
under the Supply  Agreement,  or under this  Section 11 if the Parties  have not
entered into a Supply-Agreement, with regard to delivering Licensee's forecasted
requirements  for the Liquid Polymer  Material under the terms and conditions of
the Supply  Agreement,  or under this Section 11 if the Parties have not entered
into a  Supply  Agreement  (unless  such  failure  is a result  of a  breach  or
anticipatory  breach of this Agreement by Licensee),  and such failure continues
for a period of 60 days  after  written  notice  thereof  to  Licensor,  or (ii)
Licensor becomes insolvent, or a case or proceeding under bankruptcy, insolvency
or similar law is commenced by or against  Licensor and is not dismissed  within
45 days or Licensor makes an general assignment for the benefit of creditors. If
Licensee has the right to self-manufacture  the Liquid Polymer Material pursuant
to  Section  11.3(i)  or (ii)  hereof,  Licensee  shall  exercise  its  right to
self-manufacture the Liquid Polymer Material by giving written notice thereof to
Licensor and  immediately  upon receipt of such notice  Licensor  shall  provide
Licensee with any and all  Technical  Information  and  Technical  Assistance to
allow Licensee to manufacture the Liquid Polymer Material. If any event of force
majeure  disrupts  the  supply of Liquid  Polymer  Material  to  Licensee  which
disruption  continues  for a period of 60 days,  then,  notwithstanding  Section
22.2,  Licensor  shall find an  alternate  source to supply  the Liquid  Polymer
Material  to Licensee or shall  allow  Licensee to  self-manufacture  the Liquid
Polymer Material;  provided, however, that the foregoing shall apply only during
the time period that the disruption in the supply of Liquid Polymer  Material as
a result of an event of force majeure continues.

                   11.4 Upon  execution of this  Agreement,  as a  precautionary
measure to insure all  information  relating  to the  manufacture  of the Liquid
Polymer  Material is available to Licensee in the event  Licensee  exercises its
right to  self-manufacture  the Liquid Polymer Material,  Licensor shall deliver
all of the documents  relating to the manufacture of the Liquid Polymer Material
that are necessary for Licensee to self-manufacture  the Liquid Polymer Material
to an escrow agent  mutually  agreed to by the  parties.  The escrow agent shall
hold  all of such  documents  in  escrow  pursuant  to the  terms  of an  Escrow
Agreement  between the  parties.  The Escrow  Agreement  shall  provide that the
escrow  agent will not  disclose  such  documents  to Licensee  unless and until
Licensee issues its written notice to both Licensor and the escrow agent that it
is exercising  its right to  self-manufacture  the Liquid  Polymer  Material and
Licensor  has not  provided  the  escrow  agent  with  notice  within  ten  days
thereafter that it is disputing  Licensee's right to self-manufacture the Liquid
Polymer Material.  Licensor and Licensee shall enter into an Escrow Agreement in
the form attached hereto as Attachment 11.4.

12. NONDISCLOSURE.

                   12.1  Prior to and  during  the term of this  Agreement,  the
Parties  have made and will make  certain  disclosures  to each other  regarding
information  which is proprietary and  confidential to them in their  businesses
(the   "Confidential   Information").   In  order  to  constitute   Confidential
Information, information being disclosed must either be in writing and marked as
being  proprietary or  confidential  or, if given orally,  must be identified as
proprietary  when stated and  confirmed in writing to be  proprietary  within 30
days of the original oral disclosure. In particular Licensee recognizes that the
Licensed  Intellectual Property Rights (and the confidential nature thereof) are
critical to the business of Licensor and that Licensor would not enter into this
Agreement  without  assurance that such technology and information and the value
thereof will be  protected as provided in this Section 12 and  elsewhere in this
Agreement. Accordingly, each party agrees as follows:

                   12.2 The party  receiving such  information  (the  "Receiving
Party") agrees (i) to hold the Disclosing  Party's  Confidential  Information in
confidence and to take all reasonable  precautions to protect such  Confidential
Information (including,  without limitation, all precautions the Receiving Party
employs with  respect to its  confidential  materials),  (ii) not to divulge any
such Confidential  Information or any information derived therefrom to any third
person,  (iii) not to make any use  whatsoever at any time of such  Confidential
Information  except as expressly  authorized in this Agreement,  and (iv) not to
remove or export  from the  United  States or  re-export  any such  Confidential
Information or any direct product thereof (e.g.,  Licensed  Products by whomever
made) to Afghanistan,  the Peoples' Republic of China or any Group Q, S, W, Y or
Z country (as  specified in Supplement  No. 1 to Section 770 of the U.S.  Export
Administration  Regulations,  or a  successor  thereto) or  otherwise  except in
compliance  with and with all licenses and approvals  required under  applicable
export laws and regulations,  including  without  limitation,  those of the U.S.
Department  of  Commerce.  Any employee  given  access to any such  Confidential
Information  must have a legitimate  "need to know" and shall have  executed the
standard form of the confidentiality  agreement of the Receiving Party.  Without
granting any right or license,  the  Disclosing  Party agrees that the foregoing
clauses  (i),  (ii) and (iii) shall not apply with  respect to  information  the
Receiving  Party  can  document  (i) is in or  (through  no  improper  action or
inaction  by  the  Receiving  Party  or any  Affiliate,  sublicensee,  agent  or
employee) enters the public domain,  or (ii) was rightfully in its possession or
known by it prior to receipt from the Disclosing  Party, or (iii) was rightfully
disclosed to it by another person without restriction, (iv) was disclosed by the
Disclosing Party to a third party on an unrestricted  nonconfidential  basis, or
(v) was independently developed by the Receiving Party by persons without access
to such  information  and without  use of any  Confidential  Information  of the
Disclosing  Party.  If the  Receiving  Party  believes that  information  that a
Disclosing  Party  has  identified  as  Confidential  Information  is no  longer
Confidential  Information due to the circumstances in the immediately  preceding
sentence,  the  Receiving  Party shall  establish  same by clear and  convincing
evidence  prior  to  making  a  disclosure  of such  information.  Each  party's
obligations  under this  Section  12.2  (except  under  clause (iv) of the first
sentence)  shall  terminate  five  (5)  years  after  the  termination  of  this
Agreement.

                   12.3  Immediately  upon any  termination or expiration of the
Receiving  Party's  license under Section 13, the Receiving Party will turn over
to the Disclosing Party all Confidential Information of the Disclosing Party and
all documents or media containing any such Confidential  Information and any and
all copies or extracts thereo(pound)

                   12.4  Licensor  recognizes  that  Licensee may have a need to
furnish  Technical  Information  received  hereunder  to  third  parties  in the
exercise of rights granted hereunder, and to customers (e.g., OEM) incorporating
Licensed  Products into other  equipment.  Licensee may disclose such  Technical
Information  to any such third  party for its use in the  exercise of the rights
granted by Licensor hereunder, solely for the benefit of Licensee, provided such
disclosure is made to such third parties  under a written  agreement  containing
restrictions on disclosure and use equivalent to those contained in this Section
12.

13. TERM.  This  Agreement  shall begin on the date first above  written.  This-
Agreement shall remain in effect,  unless terminated at an earlier date pursuant
to Section 14 herein,  for a period of 15 years or until the  expiration  of the
last issuing patent which is included in Licensed  Intellectual Property Rights,
whichever is greater.  Notwithstanding  the  foregoing,  Licensee shall have the
option to extend the term of this Agreement on a year-to-year basis by providing
written  notice of its  election  to extend the term within 60 days prior to the
expiration  of the initial  term or any  extended  term.  Any  extension of this
Agreement  shall be subject to all terms and  conditions  herein,  provided that
Licensee  shall be obligated to pay only 75% of the royalties that it would have
been obligated to pay during the initial term of this Agreement.

14. TERMINATION.

                   14.1 This  Agreement  may be  terminated at any time prior to
the  expiration  of its  normal  term by the  mutual  written  agreement  of the
Parties.

                   14.2  This  Agreement  may be  terminated  by  Licensor  upon
written  notice to  Licensee  if  Licensee  fails to make any  payment  when due
hereunder  and such payment is not remedied  within 30 days from written  notice
thereof.  However,  the Licensor may not  terminate  the Agreement to the extent
there is a bona fide  dispute as to the amount of  royalties  due  provided  the
amount of royalties  not in dispute are paid by Licensee  within the 30 day cure
period.

                   14.3 This  Agreement  may be  terminated by either party upon
written notice to the other party:

                           14.3.1 immediately, if the other party defaults under
or breaches any of the terms of this Agreement and such default or breach is not
remedied within a period of 60 days after written  notification  thereof (except
breach of the payment obligation, as set out above); or
14.3.2 immediately, if a material provision of this Agreement is held invalid or
unenforceable by the determination of a court of competent jurisdiction.

                  14.4 This  Agreement  may be  terminated  by Licensor  upon 30
days' prior notice to Licensee  given within the one-year  period  following the
applicable Royalty Year and the payment of $750,000 to Licensee in the event:

                           14.4.1  Licensee has failed to pay the Minimum Annual
Royalties  applicable  to the  Second  or Third  Royalty  Year and has not cured
within the 30 day notice period; or

                           14.4.2  Licensee  has  failed  to  pay a  minimum  of
$1,000,000 in royalties to Licensor each year during the Fourth  through  Tenth,
inclusive,  Royalty Year and has not cured such default within the 30 day notice
period.
                   14.5 If this Agreement is terminated pursuant to Section 14.4
above,  the  Licensee  shall retain a license to  manufacture,  use and sell the
Licensed  Products under the Licensed  Intellectual  Property  Rights,  but such
license shall be limited to the manufacture,  use and sale of Licensed  Products
to those customers of Licensee who have previously  purchased  Licensed Products
(such customers to be derived by a  customer/product  sales history and Licensee
may sell to any  such  existing  customer  only  those  pieces  in each  product
category of the Licensed Products that such customer had purchased from Licensee
prior to the  termination  of this  Agreement).  During the term of such limited
license and until the expiration of the term of this Agreement  under Section 13
hereof:  (i) Licensee  shall continue to pay Licensor  royalties  based on Gross
Profit (or net sales,  if  applicable)  as  provided  in Section  5.1;  and (ii)
Licensee may continue to obtain Liquid Polymer  Material  according to the terms
of Section 11.

15. RIGHTS AFTER TERMINATION OR EXPIRATION.

                 15.1 Except to the extent  necessary  for  Licensee to exercise
its rights under Section 14.5,  upon the  termination  of this  Agreement  under
Sections 14.1,  14.2, 14.3 or 14.4,  Licensee shall:  (i) immediately  cease all
further use of Technical  Information and manufacture of Licensed Products,  but
shall be allowed to continue to use or sell Licensed Products manufactured prior
to the date of termination of this Agreement provided, Licensee continues to pay
Licensor any royalties  relating to such use or sales; (ii) Licensee shall cease
all use of the Licensed Intellectual Property Rights; (iii) Licensee will return
to Licensor or destroy and  provide  Licensor a complete  list of all  Technical
Information, including all specifications and drawings, and all copies thereof.

<PAGE>


                   15.2  Termination  or expiration of this  Agreement (i) shall
not  release  Licensee  from  its  obligation  to  make  payment  in full of all
royalties  which have  accrued to that date,  (ii) shall not relieve the Parties
from all other  obligations or liabilities  under this Agreement which expressly
extend beyond the  termination or expiration and (iii) shall not be construed as
a waiver of any rights,  claims (including  claims for damages),  or obligations
that have accrued up to and including the date of termination or expiration.  In
particular,  it is  understood  that Sections 3.4, 5, 6, 7, 9, 12, 15, 16 and 20
hereof shall survive any termination or expiration of this Agreement.

16. LITIGATION AND FILING MATTERS.

                   16.1 Licensor  retains the sole right and  discretion to file
and prosecute patent  applications,  maintain patents and apply for intellectual
property rights in the Territory relating to the Licensed  Intellectual Property
Rights or any  Improvements.  At Licensee's  request while  Licensee  remains an
exclusive  licensee  hereunder,  Licensor  will  discuss  its  decision on these
matters with  Licensee,  but Licensee  will not attempt to file or prosecute any
such patent applications or maintain any such patent (i) except as Licensor may,
in its sole  discretion,  approve in writing and (ii) except that  Licensee  may
continue  maintenance  of licensed  patents  issued in the Territory if Licensor
elects  not  to  do  so.   Licensor's   existing  relevant  patents  and  patent
applications in the Territory are listed on Attachment 1.5.

                   16.2 If Licensee  becomes aware of any product or activity of
any  third  party  that  involves  infringement  or  violation  of any  Licensed
Intellectual  Property  Right in the  Territory,  then Licensee  shall  promptly
notify Licensor in writing of such  infringement  or violation.  Licensor may in
its discretion take or not take whatever  action it believes is appropriate;  if
Licensor elects to take action,  Licensee will reasonably cooperate therewith at
Licensor's expense. Licensor will indemnify Licensee for any damages,  expenses,
costs and fees in connection with Licensor's actions under this Section 16.2.

If Licensor does not,  within 90 days after receipt of such a notice of a patent
infringement  within the scope of Licensee's license hereunder,  commence action
directed towards restraining or enjoining such patent infringement, Licensee, so
long as it is an exclusive licensee hereunder, may take such legally permissible
action as it deems necessary or appropriate to enforce  Licensor's patent rights
and restrain such infringement.  Licensor agrees to cooperate  reasonably in any
such action  initiated by Licensee  including  supplying  essential  documentary
evidence and making essential witnesses then in Licensor's employment available.
As part of such cooperation,  Licensee may join Licensor as a party, if the need
arises, although such joinder shall be entirely at Licensee's expense.  Licensee
will indemnify Licensor for any damages,  expenses, costs and fees in connection
with  Licensee's  actions  under this  Section 16.2 Nothing in this Section 16.2
allows  Licensee or requires  Licensor to  disclose  the  Licensed  Intellectual
Property Rights except the patent rights set forth in Attachment 1.5.

                   If  Licensor  solely  initiates  and  prosecutes  any such an
action under this Section  16.2,  all legal expense  (including  court costs and
attorneys' fees) shall be for Licensor's account and it shall be entitled to all
amounts awarded by way of judgment, settlement or compromise.

                   Licensee  may  join,  solely  at its own  expense,  an action
prosecuted  by  Licensor  and any amounts  awarded by way of  judgment  shall be
allocated  between Licensor and Licensee as the court shall determine each party
has been damaged.

                   In the event  Licensor  elects  not to  initiate  suit and if
Licensee  solely  initiates and  prosecutes  such an action,  all legal expenses
(including court costs and attorneys' fees) shall be for Licensee's  account and
it shall be entitled to all amounts awarded by way of judgment,  settlement,  or
compromise.

                   16.3  Licensee  understands  that  Licensor has not conducted
comprehensive patent searches in all of the countries in the Territory.

                   16.4 INCIDENTAL AND CONSEQUENTIAL DAMAGES. NEITHER PARTY WILL
BE LIABLE UNDER ANY CONTRACT,  NEGLIGENCE,  STRICT LIABILITY OR OTHER THEORY FOR
ANY  INCIDENTAL OR  CONSEQUENTIAL  DAMAGES WITH RESPECT TO ANY SUBJECT MATTER OF
THIS  AGREEMENT  EXCEPT A BREACH OF SECTION 12.  NOTWITHSTANDING  THE FOREGOING,
THIS SECTION 16.4 SHALL NOT LIMIT THE INDEMNITY  OBLIGATION OF THE PARTIES UNDER
SECTION 9 WITH RESPECT TO CLAIMS OF THIRD PARTIES.

                 16.5 LIMITATION OF OBLIGATIONS AND LIABILITY. LICENSOR

WILL NOT BE LIABLE WITH RESPECT TO ANY SUBJECT  MATTER OF THIS  AGREEMENT  UNDER
ANY  CONTRACT,  NEGLIGENCE,  STRICT  LIABILITY  OR  OTHER  THEORY  FOR  COST  OF
PROCUREMENT  OF  SUBSTITUTE  GOODS,  SERVICES,  TECHNOLOGY  OR RIGHTS OR FOR ANY
AMOUNTS AGGREGATING IN EXCESS OF AMOUNTS PAID TO IT HEREUNDER.

17.  WAIVER OF DEFAULT.  The  failure of either  party at any time to enforce or
require  performance of any of the provisions of this Agreement,  or to exercise
any right or option herein provided, shall in no way be construed to be a waiver
of that or any other  provision of this Agreement or to affect the right of such
party thereafter to enforce each and every such provision.  All waivers shall be
in writing and signed by the  waiving  party.  No waiver by either  party of any
default  of the  other  party  shall  be held to be a  waiver  of any  other  or
subsequent default.

18.  RELATIONSHIP  OF PARTIES.  It is agreed  that the  Parties are  independent
contractors and not partners,  joint venturers or otherwise affiliated.  Neither
party has any right or  authority  to assume,  create or incur any  liability or
obligation  of any kind,  express  or  implied,  against,  in the name of, or on
behalf of the other party.

19. NOTICE.  Any notice pursuant to this Agreement shall be in writing and shall
be deemed given (i) when  delivered by hand or mail,  (ii) when  transmitted  by
telecopier,  with confirmation of receipt; provided that a copy is sent at about
the same time by registered or certified  mail,  return  receipt  requested,  or
(iii)  three days after  being sent by Express  Mail,  Federal  Express or other
express  delivery  service,  to the  addressee  at the  following  addresses  or
telecopier numbers (or to such other address or telecopier number as a party may
specify from time to time by notice):

 If to Licensor:           SurgX Corporation -
                           Attention: President
                           47341 Bayside Parkway
                           Fremont, CA 94538
                           Facsimile: (510) 249-1150
 if to Licensee:           Bussmann Division of McGraw-Edison Company
                           Attention: President
                           114 Old State Road
                           Ellisville, MO 63178
                           Facsimile: (314) 527-1497
 with copy to:             Cooper Industries, Inc.
                           Attention: General Counsel
                           P.O. Box 4446
                           Houston, Texas 77210 USA
                           Facsimile: (713) 209-8991

20.  Dispute  RESOLUTION.  Any dispute or claim arising out of, or in connection
with,  this  Agreement  which is not settled to the mutual  satisfaction  of the
Parties within thirty (30) days (or such longer period as may be mutually agreed
upon) from the date that either  party  informs  the other in writing  that such
dispute or disagreement  exists,  shall be submitted to mediation conducted by a
mediator  mutually  acceptable to the Parties.  In the event the Parties  cannot
resolve the dispute or claim through mediation,  then the claim or dispute shall
be finally settled by binding arbitration in the counties of Alameda,  San Mateo
or  Santa  Clara,  California  in  accordance  with the  rules  of the  American
Arbitration  Association by three (3)  arbitrators  appointed in accordance with
said rules in effect on the date that such notice is given.  The decision of the
arbitrators  shall be final and binding upon the Parties and  judgment  upon any
award  rendered  by all or a majority of the  arbitrators  may be entered in any
court of competent jurisdiction. Each party shall bear the cost of preparing its
case.  The cost of the  arbitration,  including  the fees  and  expenses  of the
arbitrators, will be shared equally by the Parties unless the arbitrators' award
otherwise  provides.  The Parties agree that,  any  provision of applicable  law
notwithstanding,  they  will not  request,  and the  arbitrators  shall not have
authority to award punitive  damages against any party or Parties.  Either party
may request a court to provide interim or provisional  relief and such a request
shall not be deemed  incompatible with the agreement to arbitrate or as a waiver
of that agreement.

21.  ASSIGNMENT.  This  Agreement  shall be binding  upon the  Parties and their
permitted  successors  and  assigns.  Licensor may assign or delegate any of its
rights or  obligations  under this  Agreement  to an  Affiliate  with  notice to
Licensee  provided the Licensor  remains liable for its  performance  under this
Agreement.  Licensee  may assign or  delegate  any of its rights or  obligations
under this Agreement to an Affiliate with notice to Licensor  provided  Licensee
remains liable for its performance under this Agreement.  Except for assignments
to Affiliates as described above,  neither party may assign any of its rights or
obligations  to a third  party  without the prior  written  consent of the other
party which consent shall not be unreasonably withheld or delayed.

22. MISCELLANEOUS.

                  22.1 Governing  Law. This  Agreement  shall be governed by and
construed in  accordance  with the  substantive  laws of Delaware and the United
States without regard to conflicts of laws provisions thereof and without regard
to the United  Nations  Convention  on Contracts for the  International  Sale of
Goods. Subject to Section 20 and unless otherwise elected by Licensor in writing
for the  particular  instance  (which  Licensor may do at its option),  the sole
jurisdiction and venue for actions related to the subject matter hereof shall be
the U.S.  federal  courts  having  within  their  jurisdiction  the  location of
Licensor's principal place of business. Both parties consent to the jurisdiction
of such  courts and agree  that  process  may be served in the  manner  provided
herein for giving of notices or  otherwise as allowed by  California  or federal
law. In any action or proceeding  to enforce  rights under this  Agreement,  the
prevailing party shall be entitled to recover costs and attorneys' fees.

                  22.2 Force Majeure.  Neither party hereto shall be responsible
for any  failure to perform its  obligations  under this  Agreement  (other than
obligations  to pay money or  obligations  under  Sections  9, 12 or 16) if such
failure is caused by acts of God, war, strikes,  revolutions, lack or failure of
transportation  facilities,  laws or  governmental  regulations  or other causes
which are beyond the reasonable  control of such party.  Obligations  hereunder,
however,  shall in no event be  excused  but shall be  suspended  only until the
cessation  of any cause of such  failure.  In the event that such force  majeure
should  obstruct  performance  of this Agreement for more than three (3) months,
the parties  hereto  shall  consult  with each other to  determine  whether this
Agreement  should be modified.  The party facing an event of force majeure shall
use its best  endeavors in order to remedy that situation as well as to minimize
its  effects.  A case of force  majeure  shall be notified to the other party by
telex or  telefax  within  five (5)  days  after  its  occurrence  and  shall be
confirmed by a letter.

                 22.3 Export  Control.  Each party hereby  agrees to comply with
all export laws and  restrictions  and regulations of the Department of Commerce
or other  United  States or foreign  agency or  authority,  and not to knowingly
export, or allow the export or re-export of any Licensed  Intellectual  Property
Rights or Licensed Products or derivative of the Licensed  Intellectual Property
Rights or the Licensed  Products or any direct  product  thereof in violation of
any such  restrictions,  laws or regulations,  or, without all required licenses
and authorizations,  to Afghanistan, the Peoples' Republic of China or any Group
Q, S, W, Y or Z  country  specified  in the  then  current  Supplement  No. 1 to
Section 770 of the U.S.  Export  Administration  Regulations  (or any  successor
supplement or regulations).

                  22.4 Severabilitv.  If any provision of this Agreement is held
illegal,  invalid or  unenforceable by a court of competent  jurisdiction,  that
provision will be limited or eliminated to the minimum extent  necessary so that
this Agreement shall otherwise remain in full force and effect and enforceable.

                 22.5 Entire  Agreement.  This Agreement  constitutes the entire
agreement between the Parties and supersedes all prior agreements,  negotiations
or discussions between them regarding the subject matter.
 
                 22.6 No Third-Party  Beneficiaries.  This  Agreement  shall not
confer any rights or remedies  upon any person or entity  other than the Parties
and their respective successors and permitted assigns.
                  22.7  Headings.   The  section  headings   contained  in  this
Agreement and in the attachments are inserted for convenience only and shall not
affect the meaning or interpretation of this Agreement.

                  22.8 Amendments and Waivers.  No amendment of any provision of
this Agreement or any Attachments  hereto shall be valid unless it is in writing
and signed by each party.

                  22.9  Severabilitv.  Any provision of this  Agreement  that is
invalid or unenforceable  in any situation in any jurisdiction  shall not affect
the validity or  enforceability  of the remaining  provisions or the validity or
enforceability of the offending provision in any other situation or in any other
jurisdiction.

                  22.10 Incorporation of Schedules.  The attachments  identified
in  this  Agreement  are  incorporated  by  reference  and  made a part  of this
Agreement.

                  22.11  Counterparts.  This  Agreement  may be  executed in any
number  of  counterparts  with  the same  effect  as if the  signatures  to each
counterpart were upon a single  instrument,  and all such counterparts  together
shall be deemed an original of this Agreement.

                  On the date first above  written,  each party by an authorized
representative  executes  this  Agreement in  duplicate,  each of which shall be
considered an original.

 SURGX CORPORATION
/s/Karen Shrier
Name: Karen Shrier
Title: V.P.Operations

McGRAW-EDISON COMPANY

Name:
Title:


<PAGE>






                                                   ATTACHMENT 1.5
                                        Invention: Licensed Polymer Material

The  inventions  constituting  the Liquid  Polymer  Material  are covered by the
following patent applications and any continuations,  divisionals, continuations
in part, as well as foreign  counterparts which may be assigned to Licensor,  it
being understood that these patents and applications  cover inventions which may
be broader than those used solely in the Liquid Polymer Material:

 Patent Application             File Date
 020327-002                     07/14/94                   SurgX Devices
 020327-003                     07/14/94                   SurgX Manufacturing- 
                                                           and ESD Devices

 020327-005                     01/22/96                  Printed Circuit Board 
                                                          Designs for ESD


                                 ATTACHMENT 1.6

The term  "Licensed  Products"  shall mean:  Discrete  products to be mounted on
printed  circuit  boards for the  purpose of  providing  ESD  protection,  which
discrete  products are  manufactured by depositing  Liquid Polymer Material on a
rigid  substrate  such as a FR-4 printed  circuit board or a ceramic  substrate.
Examples of such  discrete  products  include  1206,  0805,  0603 surface  mount
packages and board mounted network array packages.  Such discrete products shall
also  include  discrete  arrays for  placement on or in  connectors  such as RJ,
D-subminiature and other connectors.

Licensed  Products shall not include any other SurgX products,  such as, without
limitation,  the family of products  identified by SurgX as SurgTape  (including
discrete  components  and  connector  arrays  made from  SurgTape),  SurgX Epoxy
Packages,  or custom  SurgX  applications  such as a layer in a printed  circuit
board and novel packaging, including hybrid designs and multichip modules.



                                 ATTACHMENT 3.5
                          Trademark License Agreement


                           TRADEMARK LICENSE AGREEMENT

         This Trademark License Agreement  ("Agreement") is effective as of this
_ day of  June,  1996  ("Effective  Date"),  by and  between  SurgX  Corporation
("Licensor"),  a Delaware corporation,  having offices at 47341 Bayside Parkway,
Fremont,  California 94538, and McGraw-Edison Company  ("Licensee"),  a Delaware
corporation, having offices at 114 Old State Road, Ellisville, Missouri 63178. -

         In consideration of the mutual covenants and promises contained herein,
the parties hereto agree as follows:

1. Definitions.

The following terms shall have the meanings set forth below:

         a.  "Affiliate"  means any person  controlling,  controlled  by (either
directly or indirectly) or under common control with Licensee.

         b. "License  Agreement"  shall mean the  Intellectual  Property  Rights
License Agreement, of even date herewith, entered into by the parties hereto.

         c. "Licensed Mark" shall mean solely the trademark SurgX(R);  provided,
however,  that the appearance  and/or style of the SurgX(R) mark may change from
time to time in  Licensor's  sole  discretion.  As of the  Effective  Date,  the
Licensed  Mark is the  subject  of the  following  trademark  registrations  and
pending applications: 74/461054

         d.  "Product"  shall  mean the  "Licensed  Products"  as defined in the
License Agreement.

         e. "Territory" shall mean the world.

2. License Right Granted.

          a. In  partial  consideration  of the  consideration  set forth in the
License  Agreement,  Licensor hereby grants to Licensee,  and Licensee  accepts,
upon  the   terms   and   conditions   set  forth   herein,   a   non-exclusive,
non-transferable  (subject to Section 9 herein),  non-sublicensable  (subject to
Section  9  herein),  royalty-free  license  to use  the  Licensed  Mark  in the
Territory solely in connection with the Product.

b. Licensee  hereby  acknowledges  and agrees that,  except as set forth herein,
Licensee has no rights,  title or interest in or to the  Licensed  Mark and that
all use of the Licensed Mark by Licensee shall inure to the benefit of Licensor.
Licensee  shall not have the  right to use the  Licensed  Mark as a trade  name,
company name, trade style or fictitious business name.

         c. Licensee  understands  and agrees that it does not have the right to
use the Licensed Mark in any manner that  conflicts with the rights of any third
party. If, in Licensor's sole determination, Licensee's use of the Licensed Mark
infringes the rights of any third party or weakens or impairs  Licensor's rights
in the Licensed Mark,  then Licensee  agrees to immediately  terminate or modify
such use in accordance with Licensor's instructions. In the event Licensee fails
to terminate or modify such use as directed by Licensor,  Licensor may terminate
this Agreement.

         d. Licensee  acknowledges  that it is often difficult,  particularly in
foreign countries, to obtain clear, registered title to trademarks. Accordingly,
Licensee  agrees that the rights  granted  herein  exist only to the extent that
Licensor owns such rights,  and (except as  specifically  set forth herein or in
the License  Agreement)  no warranty,  express or implied,  is made with respect
thereto  or to the  Licensed  Mark or with  respect  to the  rights of any third
parties that may conflict  with the rights  granted  herein.  If the laws of any
country  included in the Territory  require that a trademark be registered prior
to use in order to fully protect the owner of the trademark, the license granted
herein with respect to the Licensed  Mark shall not extend to such country until
the  Licensed  Mark  has  been  registered  there at  Licensor's  expense  under
appropriate  classes  relating  to the  Product.  Licensor  and  Licensee  shall
cooperate in  constituting  Licensee as a registered user (or its equivalent) of
the Licensed  Mark in each of the  countries  comprising  the Territory in which
such  Licensed  Mark is  registered  or may be  registered,  and in  which  such
registered  user is  required.  Any  expenses  for  constituting  Licensee  as a
registered user in any country shall be borne by Licensee.

         e. Licensor agrees to defend, indemnify and hold Licensee harmless from
any  and  all  costs  and  expenses  (including   reasonable  attorneys'  fees),
liabilities, damages or other loss resulting from or relating to an infringement
by the  Licensed  Mark of any  trademark,  service mark or trade name right of a
third  party,  provided  that (i)  Licensor is promptly  notified of any and all
threats,  claims and proceedings  related thereto,  provided,  however,  that no
delay on the part of Licensee to notify Licensor shall relieve Licensor from its
indemnity  obligations  hereunder  unless  (and then  solely to the  extent) the
Licensor is thereby damaged (ii) Licensor shall have sole control of the defense
and/or settlement thereof,  (iii) upon Licensor's request and expense,  Licensee
immediately ceases use of the Licensed Mark and (iv) upon Licensor's request and
expense,  Licensee provides Licensor with reasonable  assistance and information
available to Licensee for such  defense.  The  foregoing  obligation of Licensor
does not apply to the extent any liabilities,  costs or expenses result from (a)
Licensee  continuing  the allegedly  infringing  activity  after being  notified
thereof or after being  informed of  modifications  that would have  avoided the
alleged  infringement or (b) Licensee's use of the Licensed Mark is not strictly
in accordance with the terms and provisions of this Agreement.

3. Quality Standards.

         a. Licensor  shall have the right to control the quality of the Product
sold under the Licensed Mark solely as provided  herein.  Licensee shall furnish
to Licensor, at no expense to Licensor, pre-production samples of the Product in
the form that Licensee  intends to manufacture  and sell under the Licensed Mark
to allow  Licensor  to review the  quality of the  Product,  which shall be of a
quality at least equal to that of Licensee's  other fuse products in production.
Thereafter,  upon the request of Licensor, Licensee shall furnish, at no expense
to Licensor,  production  samples of the Product  Licensee intends to sell under
the Licensed Mark to allow Licensor to monitor the quality of the Product.

         b.  Licensee  agrees  to adopt  the  level of  quality  as set forth in
Section  3(a) hereof for the Product  manufactured  and sold under the  Licensed
Mark as the minimum standard of quality for the Product.

         c.  Licensor  shall  have the  right to  request  Licensee  to make any
changes  and/or  corrections  to the Product  manufactured  and sold by Licensee
under the  Licensed  Mark as may be required to  maintain  the quality  standard
prescribed  by Licensor in Section 3(a) above,  and Licensee  agrees to make and
incorporate said changes or corrections at Licensee's sole cost and expense.

         d. Licensee shall utilize the Licensed Mark in accordance  with Section
3.5 of the License Agreement. Upon Licensor's request, Licensee shall furnish to
Licensor,  at no expense to Licensor,  samples of all  literature  and materials
containing the Licensed Mark that Licensee distributes or intends to distribute.
Licensor shall have the right to control the quality of all marketing  materials
bearing the Licensed  Mark and  Licensee's  use of the  Licensed  Mark solely as
provided herein.  If Licensor believes that the Licensed Mark is being used in a
manner that could  diminish  Licensor's  rights in or protection of the Licensed
Mark,  Licensee  agrees,  at Licensee's sole cost and expense,  to make whatever
reasonable  changes and/or  corrections  Licensor deems necessary to protect the
Licensed Mark.

         e. Licensee  agrees that it shall not engage,  participate or otherwise
become  involved  in any  activity or course of action  that  diminishes  and/or
tarnishes the image and/or reputation of the Licensed Mark.

         (pound)  Licensee  agrees to comply with all applicable  local,  state,
federal and foreign laws and, at all times, to conduct its activities under this
Agreement in a lawful manner.

         g. Licensee agrees to use the Licensed Mark in accordance with and only
on or in connection with the Product. 

4. Use and Display of Licensed Mark.

         a. Licensee  acknowledges and agrees that the presentation and image of
the Licensed Mark should be uniform and consistent with respect to all services,
activities and products associated with the Licensed Mark. Accordingly, Licensee
agrees to use the  Licensed  Mark  solely in the  manner  which  Licensor  shall
specify from time to time in Licensor's sole discretion.

         b. All  usage by  Licensee  of the  Licensed  Mark  shall  include  the
registered  trademark symbol and shall be in the following form, as appropriate:
SurgX(R).  All  marketing  materials  printed,   distributed  or  electronically
transmitted  by Licensee  and  containing  the Licensed  Mark shall  include the
following notice:

SurgX(R) is a registered trademark of SurgX Corporation.

5. Term and Termination.

         a.  This  Agreement  shall  commence  on the  Effective  Date and shall
continue  in  effect  for a period  coterminous  with  the  term of the  License
Agreement, unless earlier terminated in accordance with the terms and conditions
set forth herein.

         b. This Agreement shall  automatically  terminate upon termination (for
whatever  reason)  of the  License  Agreement.  If under the  License  Agreement
Licensor  extends to Licensee a sell-off period within which to sell the Product
to certain  existing  customers  of Licensee,  Licensee  shall have the right to
continue  using  the  Licensed  Mark  in  connection   with  its  marketing  and
distribution  efforts  only for such  products and only for the duration of such
sell-off period.

         c. This  Agreement and the license  granted herein may be terminated by
Licensor if Licensee  fails to perform or comply  with a material  provision  of
this Agreement and such breach or default is not cured by Licensee within thirty
(30) days after written notice of termination is received by Licensee.

         d. Except as expressly set forth in Section S(b) above,  Licensee shall
immediately cease all use of the Licensed Mark upon expiration or termination of
this Agreement.

6. Cooperation and Protection.

         a. Licensee agrees to reasonably  cooperate with and assist Licensor in
protecting and defending the Licensed Mark and shall promptly notify Licensor in
writing of any  infringements,  claims or actions by others  (which  come to the
attention of Licensee) in derogation of the Licensed  Mark;  provided,  however,
that Licensor shall have the sole right to determine whether any action shall be
taken on account of any such infringement,  claim or action.  Licensee shall not
take any action on account of any such infringement, claim or action without the
prior written consent of Licensor.

         b. Licensee  agrees not to apply for  registration of the Licensed Mark
(or any mark confusingly  similar thereto)  anywhere in the Territory.  Licensor
may  elect  to apply  for  registration  of the  Licensed  Mark in a  particular
country(ies)  within the  Territory  at its  expense,  and, in such event and if
applicable,  Licensee agrees to reasonably assist and cooperate with Licensor in
connection therewith.

7. Indemnification.

         Licensee  agrees to defend,  indemnify and hold Licensor  harmless from
and  against any and all costs and  expenses  (including  reasonable  attorneys'
fees),  liabilities,  damages or other loss arising out of Licensee's actions or
omission to act under this  Agreement or  Licensee's  organization,  business or
activities.

8. Independent Contractors.

         The parties hereto are  independent  contractors  and are not partners,
joint  venturers or  otherwise  affiliated,  and neither  party has any right or
authority to bind the other in any way.

9. Assignment.

         Licensee  may  not  assign  this  Agreement  or any of  its  rights  or
obligations  under this Agreement without the prior written consent of Licensor,
provided,  however,  Licensee  may  assign  or  delegate  any of its  rights  or
obligations  under this  Agreement to an Affiliate  with notice to Licensor (and
without   Licensor's   consent),   provided  Licensee  remains  liable  for  its
performance under this Agreement.

10. Notice.

         Any notice  pursuant to this Agreement shall be in writing and shall be
deemed  given  (i) when  delivered  by hand or mail,  (ii) when  transmitted  by
telecopier,  with confirmation of receipt; provided that a copy is sent at about
the same time by registered or certified  mail,  return  receipt  requested,  or
(iii)  three days after  being sent by Express  Mail,  Federal  Express or other
express  delivery  service,  to the  addressee  at the  following  addresses  or
telecopier numbers (or to such other address or telecopier number as a party may
specify from time to time by notice):

 If to Licensor:            SurgX Corporation
                            Attention: President
                            47341 Bayside Parkway
                            Fremont, CA 94538
                            Facsimile: (510) 249-1150

 if to Licensee:            Bussmann Division of McGraw-Edison
                            Company
                            Attention: President
                            114 Old State Road
                            Ellisville, MO 63178
                            Facsimile: (314) 527-1497

with copy to:              Cooper Industries, Inc.
                           Attention: General Counsel
                           P.O. Box 4446
                           Houston, Texas 77210 USA
                           Facsimile: (713) 209-8991
11.      General.

          a. Amendment.  Modification and Waiver. The failure of either party to
enforce its rights or to require  performance  by the other party of any term or
condition of this Agreement shall not be construed as a waiver of such rights or
of its  right to  require  future  performance  of that term or  condition.  Any
amendment or  modification  of this Agreement or any waiver of any breach of any
term or condition of this  Agreement must be in a writing signed by both parties
in order to be effective, and any such waiver shall not be construed as a waiver
of any  continuing or succeeding  breach of such term or condition,  a waiver of
the term or condition itself or a waiver of any right under this Agreement.

         b.  Governing  Law. This  Agreement  shall be governed and  interpreted
under the laws of the State of  Delaware  without  regard  to the  conflicts  of
interest provisions thereo(pound)

         c.  Headings.  Headings and captions are for  convenience  of reference
only and shall not be deemed to interpret, supersede or modify any provisions of
this Agreement.

          d.  Severabilitv.  In the event that any  provision of this  Agreement
shall be  determined  to be illegal or  unenforceable,  that  provision  will be
limited or eliminated  to the minimum  extent  necessary so that this  Agreement
shall otherwise remain in full force and effect and enforceable.

          e. Entire  Agreement.  Upon execution by both parties,  this Agreement
shall  constitute the entire  agreement  between the parties with respect to the
subject matter hereof and supersedes all discussions,  negotiations,  agreements
and past dealings, either oral or written, between or among the parties relating
to the subject matter hereof.

         f.  Dispute  Resolution.  Any  dispute or claim  arising  out of, or in
connection with, this Agreement which is not settled to the mutual  satisfaction
of the parties within thirty (30) days (or such longer period as may be mutually
agreed upon) from the date that either  party  informs the other in writing that
such dispute or disagreement  exists,  shall be submitted to mediation conducted
by a mediator  mutually  acceptable  to the  parties.  In the event the  parties
cannot resolve the dispute or claim through mediation, then the claim or dispute
shall be finally settled by binding arbitration in the counties of Alameda,  San
Mateo or Santa Clara,  California in  accordance  with the rules of the American
Arbitration  Association by three (3)  arbitrators  appointed in accordance with
said rules in effect on the date that such notice is given.  The decision of the
arbitrators  shall be final and binding upon the parties and  judgment  upon any
award  rendered  by all or a majority of the  arbitrators  may be entered in any
court of competent jurisdiction. Each party shall bear the cost of preparing its
case.  The cost of the  arbitration,  including  the fees  and  expenses  of the
arbitrators, will be shared equally by the parties unless the arbitrators' award
otherwise  provides.  The parties agree that,  any  provision of applicable  law
notwithstanding,  they  will not  request,  and the  arbitrators  shall not have
authority to award punitive  damages against any party or parties.  Either party
may request a court to provide interim or provisional  relief and such a request
shall not be deemed  incompatible with the agreement to arbitrate or as a waiver
of that agreement.

         g. Survival. Sections 2(e), 5(b), 6(b), 7, 11(b) and 11(f) hereof shall
survive the termination of this Agreement.

         h.  Counterparts.  This  Agreement  may be  executed  in any  number of
counterparts  with the same effect as if the signatures to each counterpart were
upon a single instrument, and all such counterparts together shall be deemed an
original of this Agreement.

         IN WITNESS WHEREOF,  the parties hereto have each caused this Agreement
to be executed by their  authorized  representatives  as of the date first above
written.

 SURGX CORPORATION                                 McGRAW-EDISON COMPANY
 By:                                               By:
 Printed Name                                      Printed Name
 Title                                             Title




<PAGE>




                                             ATTACHMENT 4.1

                                         Delivery Schedule for
                                         Technical Information

 1.      SurgX Specification and Manufacturing Procedures Control Documents
 2.      R5-11 Environmental Test Results
 3.      SurgX ESD QC Test Procedure

All items to be delivered on or before July 22, 1996.



<PAGE>




                                           ATTACHMENT 11.1

Licensor's cost of the Liquid Polymer Material shall equal  Licensor's  standard
costs for the Liquid Polymer  Material  including  direct and indirect labor and
associated fringe benefits, scrap, perishable tooling, supplies, and maintenance
on machinery and equipment.  Only costs directly associated with the manufacture
of Liquid Polymer Material will be included in standard costs.


                                           ATTACHMENT 11.4
                                          Escrow Agreement



<PAGE>


                                          ESCROW AGREEMENT
                                               BETWEEN

                                          SURGX CORPORATION
                                             (Licensor)

                                                 AND

                                        MCGRAW-EDISON COMPANY
                                             (Licensee)

                                                 AND

                                   BURNS, DONE, SVVECKER & MATHIS
                                           (Escrow Agent)

                                                AS OF

                                            JULY 12, 1996







                                          ESCROW AGREEMENT
                                          Table of Contents

Page

  1. Deposits
1
  2. Representations of Licensor to Licensee
2
  3. Notice of Default
2
  4. Disputes
2
  5. Payment to Escrow Agent
3
  6. Termination
3
  7. Waiver, Amendment or Modification; Severability
3
  8. Notices
3

  9. Limitation on Escrow Agent's Responsibility and Liability ........   3
  10. Counterparts .--------...........................................   4

Schedule A Description of Materials  Containing the Escrow  Information
Relating to the Manufacture of the Liquid Polymer Material . i


                                                  ESCROW AGREEMENT

         ESCROW  AGREEMENT  dated  as of  July  12,  1996  by  and  among  SurgX
Corporation,  having its principal  offices at 47341 Bayside  Parkway,  Fremont,
California  (hereinafter  the  "Licensor");  McGraw-Edison  Company,  a Delaware
corporation  having its  principal  offices  at 114 Old State  Road  Ellisville,
Missouri (hereinafter the "Licensee");  and Burns, Doane, Swecker & Mathis, LLP,
a law firm having an office at 3000 Sand Hill Road, Building 4, Suite 160, Menlo
Park, California (hereinafter the "Escrow Agent").

W I T N E S S E T H:

         WHEREAS, the Licensor and the Licensee have entered into a Intellectual
Property  Rights  License  ("License  Agreement"),  a copy of which is  appended
hereto and made a part  hereof,  pursuant  to which the  Licensor  has agreed to
license to the Licensee patents,  patent applications,  information,  technology
and rights  relating to Licensed  Products which  incorporate the Liquid Polymer
Material; and

         WHEREAS,  it is  the  policy  of  the  Licensor  not  to  disclose  the
information  to allow  another  party to  self-manufacture  the  Liquid  Polymer
Material  including  technical  and  production  know-how,   drawings,  designs,
specifications,  formulas, data, trade secrets and other information relating to
the manufacture of the Liquid Polymer Material ("Escrow  Information") except as
provided in an applicable Escrow Agreement; and

         WHEREAS,  Licensor  and  Licensee  agree  that upon the  occurrence  of
certain events  described in Section 3(a) hereof,  the Licensee shall be able to
obtain the Escrow Information for the Liquid Polymer Material,  and accordingly,
the Licensor agrees to deliver said Escrow Information to the Escrow Agent; and

         WHEREAS,  capitalized terms not otherwise defined herein shall have the
meaning set forth in the License Agreement;

         NOW,  THEREFORE,  in consideration  of the mutual  covenants  contained
herein and for other valuable  consideration,  the adequacy and receipt of which
are hereby acknowledged,  the Licensor, the Licensee and the Escrow Agent hereby
act and agree as follows:

1. Deposits

         The  Escrow  Agent  agrees  to  accept  from the  Licensor  the  Escrow
Information (as more fully described in Schedule A hereto) and revisions thereof
as provided in Section 2 hereof.  The Escrow  Agent will issue to the Licensor a
receipt for the Escrow Information upon delivery. The Escrow Information held by
the Escrow Agent shall remain the exclusive  property of the  Licensor,  and the
Escrow  Agent shall not use the Escrow  Information  or disclose the same to any
third party except as  specifically  provided for herein.  The Escrow Agent will
hold the Escrow Information in safekeeping at its offices hereinabove  indicated
unless and until the Escrow Agent receives  notice pursuant to the terms of this
Agreement  that the  Escrow  Agent  is to  deliver  the  Escrow  Information  to
Licensee, in which case the Escrow Agent shall deliver the Escrow Information to
Licensee, subject, however, to the provisions of this Escrow Agreement.

2. Representations of Licensor to Licensee

         Licensor  represents  and  warrants  to Licensee  that:  (i) the Escrow
Information  constitutes all of the information  necessary to allow a reasonably
skilled  engineer,  without  reference to any other  material or the help of any
other person to manufacture the Liquid Polymer Material;  and (ii) Licensor will
promptly  supplement  the  Escrow  Information   delivered  hereunder  with  all
Improvements  thereof  developed by Licensor  from time to time  pursuant to the
License  Agreement so that the Escrow  Information  constitutes the most current
information  available  relating  to  the  manufacture  of  the  Liquid  Polymer
Material.

3. Notice of Default

         (a)  The   Licensor   shall  be  deemed  to  be  in   default   of  its
responsibilities  to Licensee  for  purposes of this  Escrow  Agreement  if: (i)
Licensor  fails to meet the  obligations  referred to in Section  11.3(i) of the
License  Agreement;  (ii) Licensor  becomes  insolvent,  or a case or proceeding
under bankruptcy,  insolvency or similar law is commenced by or against Licensor
and is not dismissed  within 45 days or Licensor makes a general  assignment for
the benefit of creditors;  or (iii) if any event of force  majeure  disrupts the
supply of Liquid Polymer Material to Licensee which  disruption  continues for a
period of 60 days and Licensor  fails to find an alternate  source to supply the
Liquid Polymer  Material to Licensee or allow Licensee to  self-manufacture  the
Liquid Polymer  Material.  Licensee shall give a sworn statement (the "Notice of
Default")  to Licensor of any such  default by the  Licensor  stating  that such
default has not been cured with a copy of such notice to the Escrow Agent.

         (b) If the  Licensor  desires to dispute  the  Notice of  Default,  the
Licensor  shall,  within ten business (10) days after the receipt of the copy of
the Notice of Default from the Licensee,  deliver to Licensee a sworn  statement
(the  "Affidavit")  saying that no default has occurred or such default has been
cured and Licensor  shall provide a copy of such  Affidavit to the Escrow Agent,
whereupon  the  provisions  of Section 4 hereof will become  applicable.  If the
Escrow Agent  receives the  Affidavit  within said ten (10) business  days,  the
Escrow Agent shall continue to hold the Escrow  Information  in accordance  with
this Escrow Agreement. If the Escrow Agent does not receive the Affidavit within
said ten (10)  business  days,  the Escrow Agent is  authorized  and directed to
deliver the Escrow Information to the Licensee. ~.

         (c)  Following  a release  of the Escrow  Information  as  provided  in
Section 3,  Licensee  shall  have the  non-exclusive  right to use the  released
material  as and only as  authorized  by  Section 11 of the  License  Agreement.
Additionally,  Licensee shall be required to maintain the confidentiality of the
related  materials and  technology  in accordance  with the terms of the License
Agreement.

4. Disputes

         (a) In the event  that  Licensor  files the  Affidavit  with the Escrow
Agent in the manner and within the time period set forth in Section 3(b) hereof,
the Escrow Agent shall not release the Escrow  Information to Licensee except in
accordance with (i) a final decision of the

Escrow Agreement
                                                       - 2 -

arbitration panel as hereinafter  provided, or (ii) receipt of an agreement with
notarized  signatures of both Licensor and Licensee,  authorizing the release of
the Escrow Information to Licensee.

         (b) Disputes arising under this Agreement shall be referred immediately
to, and finally  settled by, binding  arbitration  pursuant to the provisions of
Section 20 of the License  Agreement.  The Escrow Agent shall give prompt effect
to any  authenticated  arbitration  award.  This  agreement to  arbitrate  shall
survive termination of this Agreement.

5. Payment to Escrow Agent

         As payment for its services hereunder, the Licensor shall reimburse the
Escrow Agent for its reasonable  out-of-pocket  expenses  incurred in connection
with the discharge by the Escrow Agent of its duties and responsibilities  under
this Escrow Agreement.

6; Termination

         This Escrow Agreement shall terminate on the termination of the License
Agreement or upon the mutual written agreement of Licensor and Licensee.

7. Waiver. Amendment or Modification: Severabilitv

         This Escrow Agreement shall not be waived,  amended, or modified except
by the written agreement of all the parties hereto. Any invalidity,  in whole or
in part, of any provision of this Escrow Agreement shall not affect the validity
of any other of its provisions.

8. Notices

         All  notices  required  to be given  hereunder  shall be in writing and
shall be deemed given if delivered personally (upon recipient's actual receipt),
if mailed by certified or registered  mail,  return receipt  requested (upon the
date of delivery to recipient), or if by nationally recognized air courier which
confirms  delivery (upon date of delivery to the  recipient),  to the parties at
their  respective  addresses  hereinabove  written,  or at such other address as
shall be specified hereinabove in writing to all other parties.

9. Limitation on Escrow Agent's Responsibility and Liability

         (a) The Escrow Agent shall  maintain the Escrow  Information  in a safe
and shall  provide  the same  degree of care for the  Escrow  Information  as it
maintains for its valuable  documents  and those of its customers  lodged in the
same location.

         (b) The Escrow  Agent  shall be  protected  in acting  upon any written
notice, request,  waiver, consent,  receipt or other paper or document furnished
to it, not only in assuming its due execution and the validity and effectiveness
of its provisions but also as to the truth and  acceptability of any information
therein  contained,  which it in good faith  believes  to be genuine and what it
purports to be.

Escrow Agreement
                                                       - 3 -

         (c) In no event shall the Escrow Agent be liable for any act or failure
to act under the provisions of this Escrow  Agreement  except where its acts are
the result of its gross negligence or willful misconduct. The Escrow Agent shall
have no duties except those which are  expressly set forth herein,  and it shall
not be bound by any notice of a claim,  or demand with respect  thereto,  or any
waiver,  notification,  amendment,  termination  or  rescission  of this  Escrow
Agreement,  unless in writing  received by it, and, if its duties are  affected,
unless it shall have given its prior written consent thereto.

         (d) The Licensor and Licensee hereby agree,  jointly and severally,  to
indemnify  the Escrow Agent against any loss,  liability,  or damage (other than
any caused by the gross  negligence or willful  misconduct of the Escrow Agent),
including  reasonable costs of litigation and counsel fees,  arising from and in
connection with the performance of its duties under this Agreement. The Licensor
and Licensee  will not bring a suit or file a claim against the Escrow Agent for
any act or failure to act under the provisions of this Escrow  Agreement  except
where its acts are the result of its gross negligence or willful misconduct.

10. Counterparts

         This Escrow  Agreement  may be  executed in any number of  counterparts
with the same effect as if the signatures to each counterpart were upon a single
instrument,  and all such  counterparts  together shall be deemed an original of
this Escrow Agreement.

         IN  WITNESS  WHEREOF,  the  parties  hereto  have  caused  this  Escrow
Agreement to be duly executed as of the year and date first above written.

SURGX CORPORATION ("Licensor")

 Attest:                                                 By: /s/Karen Shrier

MCGRAW-EDISON COMPANY ("Licensee")

Attest:

By:

BURNS, DOANE, SWECKER & MATHIS

("Escrow Agent")

Attest:

                                                         By:


Escrow Agreement


                                   SCHEDULE A

Description of Materials  Containing the Escrow Information and related
Documentation:

               On the date first above  written,  each party by an authorized
representative  executes  this  Agreement in  duplicate,  each of which shall be
considered an original.

SURGX CORPORATION

/s/ Karen Shrier
Name:  Karen Shrier
Title:  V.P. Operations

McGRAW-EDISON COMPANY

/s/ Thomas J. Guzak
Name: Thomas J. Guzak
Title: V.P. Product & Market Development