EMPLOYMENT AGREEMENT

              AGREEMENT  made as of the 25th day of April,  1997, by and between
Sheffield Medical  Technologies Inc., a Delaware  corporation with its principal
offices at 30  Rockefeller  Plaza,  Suite  4515,  New York,  New York 10112 (the
"Corporation"), and Loren G. Peterson residing at 1776 Stifel Lane Drive, Town &
Country, Missiouri 63017 ("Executive").

                              W I T N E S S E T H :
                              - - - - - - - - - -

              WHEREAS, the Corporation desires to employ and retain Executive as
its Chief  Executive  Officer,  upon the terms and subject to the  conditions of
this Agreement; and

              NOW,  THEREFORE,  in  consideration of the premises and the mutual
covenants hereinafter set forth, the parties hereto agree as follows:

              1.  EMPLOYMENT  OF  EXECUTIVE.   The  Corporation  hereby  employs
Executive  as  its  Chief   Executive   Officer,   to  perform  the  duties  and
responsibilities  traditionally incident to such office, subject at all times to
the control and direction of the Board of Directors of the Corporation.

              2. ACCEPTANCE OF EMPLOYMENT; OFFICES; TIME AND ATTENTION, ETC. (a)
Executive  hereby accepts such  employment and agrees that throughout the period
of his employment hereunder,  except as hereinafter provided, he will devote his
full business and  professional  time in utilizing his business and professional
expertise,  with proper attention,  knowledge and skills faithfully,  diligently
and to the best of his ability in furtherance of the business of the Corporation
and its  subsidiaries  and will  perform the duties  assigned to him pursuant to
Paragraph 1 hereof.  As Chief  Executive  Officer,  Executive shall also perform
such specific duties and shall exercise such specific  authority  related to the
management of the day-to-day  operations of the Corporation and its subsidiaries
as may be  reasonably  assigned to  Executive  from time to time by the Board of
Directors of the Corporation.

              (b) Executive  shall at all times be subject to, observe and carry
out such rules, regulations,  policies, directions and restrictions as the Board
of Directors of the Corporation  shall from time to time  establish.  During the
period of his employment hereunder, Executive shall not, directly or indirectly,
accept  employment or compensation  from, or perform services of any nature for,
any  business  enterprise  other  than  the  Corporation  and its  subsidiaries.
Notwithstanding  the  foregoing  in this  Paragraph  2,  Executive  shall not be
precluded from engaging in  recreational,  eleemosynary,  educational  and other
activities  which do not materially  interfere with his duties  hereunder during
vacations, holidays and other periods outside of business hours.

              (c) It is anticipated that the Corporation's  principal  executive
office (now located in New York City) shall be relocated


<PAGE>
to St. Louis,  Missouri but that Executive may be required to spend  substantial
amounts of time at locations in and outside of St. Louis,  Missouri  relating to
the business of the  Corporation  and its  subsidiaries.  It is understood  that
Executive  shall  continue to reside in the vicinity of St. Louis,  Missouri and
that the Corporation shall maintain an office in St. Louis,  Missouri,  which is
where  Executive  shall  maintain his  principal  office  until the  Corporation
relocates from New York City to St. Louis,  Missouri.  The Corporation agrees to
reimburse  Executive for his  reasonable  expenses,  including  hotel and travel
costs, associated with the Corporation's business. In addition, until completion
of  such   relocation,   it  is  understood   that  Executive  shall  visit  the
Corporation's  executive office in New York City on a regular basis for meetings
and to conduct  Corporation  business that is more appropriately  conducted from
such executive office.

              3.  TERM.  Except  as  otherwise  provided  herein,  the  term  of
Executive's  employment hereunder shall commence on the date of the consummation
of the  merger of  Camelot  Pharmacal,  L.L.C.,  a  Missouri  limited  liability
company,  with and into a  subsidiary  of the Company (the  "Merger")  and shall
continue  to and  including  April 25,  2002.  Notwithstanding  anything  to the
contrary contained in the Agreement,  this Agreement shall terminate and have no
force and effect in the event that the  Merger is not  consummated  on or before
June 6, 1997.  Unless  terminated  earlier in accordance  with the terms hereof,
this  Agreement  shall  automatically  be  extended  for one or more  additional
consecutive  one year terms  unless  either  party  notifies  the other party in
writing at least six months  before the end of the then current term  (including
the initial term) of its or his desire to terminate this Agreement. The last day
of the term of this Agreement  pursuant to this Paragraph 3 (including any early
termination  pursuant  to  the  terms  hereof)  is  referred  to  herein  as the
"Termination Date."

              4. COMPENSATION.  (a) As compensation for his services  hereunder,
the  Corporation  shall pay to Executive (i) a base annual salary at the rate of
$175,000,  payable in equal  installments  in accordance with the normal payroll
practices of the Corporation but in no event less frequently than  semi-monthly,
and (ii)  such  incentive  compensation  and  bonuses,  if any,  as the Board of
Directors of the  Corporation in its absolute  discretion may determine to award
Executive  (it  being  understood  that  this  Agreement  shall  in no  event be
construed to require the payment to Executive of any incentive  compensation  or
bonuses),  it being  understood that Executive shall be entitled to receive such
incentive  compensation  and bonuses  determined  on a basis  comparable  to the
incentive compensation and/or bonuses awarded to other executive officers of the
Corporation.  All compensation paid to Executive shall be subject to withholding
and other employment taxes imposed by applicable law.

              (b)  During  the  period  of  Executive's   employment  hereunder,
Executive  shall not be entitled to any  additional  compensation  for rendering
employment services to subsidiaries of


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<PAGE>
the  Corporation  or for serving in any office of the  Corporation or any of its
subsidiaries to which he is elected or appointed.

              (c) In the event that  Executive  is elected to the  Corporation's
Board of  Directors,  Executive  will  receive  compensation  and  benefits as a
director  of the  Corporation  consistent  with the  compensation  and  benefits
received by the  Corporation's  other  directors  who are also  employees of the
Corporation.

              5. STOCK OPTIONS. (a) As additional  compensation for his services
hereunder,  the  Corporation  shall  grant to  Executive  an  option  under  the
Corporation's  1993 Stock Option Plan (the "Plan") to acquire a total of 400,000
shares of the Corporation's common stock at an exercise price per share equal to
the  closing  sale price of the  Corporation's  common  stock as reported by the
American Stock Exchange on the date hereof,  with the terms of such option to be
evidenced by (i) one option letter  agreement in the form annexed as Exhibit "A"
hereto  ("Option  Letter A-1") being  exercisable  for 100,000  shares of Common
Stock,  (ii) one option  letter  agreement in the form annexed as Exhibit  "A-2"
hereto  ("Option  Letter A-2") being  exercisable  for 150,000  shares of Common
Stock and (iii) one option  letter  agreement in the form annexed as Exhibit "B"
hereto ("Option Letter B") being  exercisable for 150,000 shares of Common Stock
(such option letters being referred to  collectively  herein as the "Plan Option
Letters").

              (b) The Company  represents and warrants that there are sufficient
shares of Common Stock currently available under the Company's 1993 Stock Option
Plan (the "1993 Plan") to cover the shares of Common Stock issuable to Executive
upon exercise of Option Letter A-1.

              (c) In the event that the Company's  stockholders fail at the next
annual  meeting  of  stockholders  of the  Corporation  to  approve  both (i) an
amendment  increasing the number of shares available for the issuance of options
under  the Plan to an  amount at least  sufficient  to cover  all the  shares of
Common Stock issuable upon exercise of Option Letter A-2 and Option Letter B and
(ii) appropriate amendments to the Plan specifically confirming the right of the
Corporation's  Board of  Directors,  in the issuance of stock  options under the
Plan,  to  determine  provisions  regarding  terms of the exercise of such stock
options  (including  without  limitation,  the period of exercisability of stock
options  under the Plan upon  termination  of  employment  for cause or  without
cause) and provisions  regarding forfeiture of stock options under the Plan upon
termination of employment,  the Company agrees, upon receipt of a written demand
from  Executive,  to promptly amend the Plan Option Letters to provide for three
non-qualified  options outside the Plan having  substantially the same terms and
provisions of the Plan Stock Options.

              (d) In the event that (i) the Corporation is required to amend the
Plan Option Letters pursuant to Paragraph 5(c) or (ii) Executive's employment by
the Corporation is terminated (x) by the


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<PAGE>
Corporation for any reason other than for Cause, (y) by Executive as a result of
an  Employer  Breach or (z) by the  Corporation  by  reason  of the  Executive's
disability or death prior to the expiration of the options evidenced by the Plan
Option  Letters  and  Executive  is  required  after  such event to pay any U.S.
federal or state income and  withholding tax  (collectively,  "Income Taxes") on
any  income  recognized  by  Executive  arising  upon any  exercise  of  options
evidenced  by the Plan  Option  Letters,  the  Corporation  agrees to  reimburse
Executive the difference  between (A) the amount of Income Taxes Executive would
have been  required  to pay had the  income  recognized  on such  exercise  been
treated as a long term capital  gain and (B) the amount of Income Taxes  payable
by Executive in respect of such  exercise (the amount of such  difference  being
referred to as the "Tax  Difference" in respect of such exercise).  In computing
the Tax Difference, the amount of taxes payable by Executive shall be determined
by assuming that the income  recognized as a result of such exercise is taxed at
the highest  marginal  federal and state income tax rates applicable to ordinary
income. In addition,  the Corporation shall pay Executive an amount equal to the
Tax Difference arising in respect of such exercise multiplied by a fraction, the
numerator of which is 1 and the denominator of which is equal to 1 minus (i) the
highest marginal federal income tax rate (currently  39.6%) and (ii) the highest
marginal state income tax rate applicable to Executive,  in each case in respect
of ordinary income, in effect at the time of such exercise. Such amount shall be
paid by the  Corporation  within  ninety  (90)  days  after  any such  exercise.
Notwithstanding  anything to the  contrary in this  Agreement or the Plan Option
Letters, the Corporation shall have no obligation to pay Executive any amount in
excess of $250,000 in the  aggregate  in respect of its  obligations  under this
subparagraph.

              6.  ADDITIONAL  BENEFITS;  VACATION.  (a) In addition to such base
salary, Executive shall receive and be entitled to participate, to the extent he
is  eligible  under the terms and  conditions  thereof,  in any profit  sharing,
pension, retirement, hospitalization,  disability, medical service, insurance or
other employee benefit plan generally available to the executive officers of the
Corporation  that may be in  effect  from  time to time  during  the  period  of
Executive's  employment  hereunder.  The  Corporation  agrees to cover Executive
under  any  directors'  and  officers'   liability  policy   maintained  by  the
Corporation.

              (b)  Executive  shall be entitled to four (4) weeks' paid vacation
in respect of each 12-month period during the term of his employment  hereunder,
such vacation to be taken at times mutually agreeable to Executive and the Board
of Directors of the Corporation.

              (c) Executive  shall be entitled to recognize as holidays all days
recognized as such by the Corporation.

              7.  REIMBURSEMENT  OF EXPENSES.  The  Corporation  shall reimburse
Executive in accordance  with  applicable  policies of the  Corporation  for all
expenses reasonably incurred by him in


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<PAGE>
connection with the performance of his duties  hereunder and the business of the
Corporation,  upon the submission to the Corporation of appropriate  receipts or
vouchers.

              8. RESTRICTIVE COVENANT. (a) In consideration of the Corporation's
entering  into this  Agreement,  Executive  agrees that during the period of his
employment  hereunder  and, in the event of termination of this Agreement (i) by
the  Corporation  upon Executive  becoming  Disabled (as that term is defined in
Paragraph 13 hereof), (ii) by the Corporation for Cause (as that term is defined
in Paragraph 14 hereof) or (iii) by Executive otherwise than for Employer Breach
(as that term is defined in  Paragraph 15 hereof),  for a further  period of six
months thereafter,  he will not (x) directly or indirectly own, manage, operate,
join,  control,  participate  in,  invest in,  whether as an officer,  director,
employee, partner, investor or otherwise, any business entity that is engaged in
a  directly  competitive  business  (as  hereinafter  defined)  to  that  of the
Corporation or any of its subsidiaries within the United States of America,  (y)
for  himself  or on behalf  of any other  person,  partnership,  corporation  or
entity,  call on any customer of the Corporation or any of its  subsidiaries for
the purpose of soliciting  away,  diverting or taking away any customer from the
Corporation  or its  subsidiaries,  or (z) solicit any person then engaged as an
employee,  representative,  agent,  independent  contractor  or otherwise by the
Corporation  or any of its  subsidiaries,  to terminate his or her  relationship
with the Corporation or any of its subsidiaries. For purposes of this Agreement,
the term "directly  competitive  business"  shall mean any business that is then
involved in the research, development, manufacturing or commercialization in any
way of any  product,  compound,  device or method  that  acts or  functions  by,
through or on the same active,  binding or receptor  site,  mechanism of action,
signaling pathway or channel as any product,  compound, device or method that is
or becomes a part of the  Corporation's  business or the  business of any of its
subsidiaries  during  Executive's  employment by the  Corporation  or any of its
subsidiaries.  Nothing  contained in this Agreement  shall be deemed to prohibit
Executive  from investing his funds in securities of an issuer if the securities
of such issuer are listed for trading on a national  securities  exchange or are
traded in the over-the-counter market and Executive's holdings therein represent
less  than  10% of the  total  number  of  shares  or  principal  amount  of the
securities of such issuer outstanding.

              (b) Executive acknowledges that the provisions of this Paragraph 8
are  reasonable and necessary for the  protection of the  Corporation,  and that
each provision,  and the period or periods of time,  geographic  areas and types
and scope of  restrictions  on the  activities  specified  herein  are,  and are
intended to be, divisible.  In the event that any provision of this Paragraph 8,
including any sentence,  clause or part hereof,  shall be deemed contrary to law
or invalid or unenforceable in any respect by a court of competent jurisdiction,
the  remaining  provisions  shall not be  affected,  but  shall,  subject to the
discretion of such court, remain in full force and effect.


                                       5
<PAGE>
              9. CONFIDENTIAL INFORMATION.

                 (a)  Executive  shall  hold  in a  fiduciary  capacity  for the
benefit of the Corporation and its subsidiaries  all  confidential  information,
knowledge and data relating to or concerned with its operations, sales, business
and affairs,  and he shall not, at any time during his employment  hereunder and
for two  years  thereafter,  use,  disclose  or  divulge  any such  information,
knowledge  or  data  to any  person,  firm  or  corporation  other  than  to the
Corporation and its subsidiaries or their respective  designees or except as may
otherwise be reasonably  required or desirable in  connection  with the business
and affairs of the Corporation and its subsidiaries.

                 (b) Notwithstanding  anything to the contrary contained herein,
Executive's  obligations  under  Paragraph  9(a)  hereof  shall not apply to any
information which:

              (i) becomes  rightfully known to Executive  subsequent or prior to
     his employment by the Corporation;

              (ii) is or becomes  available to the public other than as a result
     of wrongful disclosure by Executive;

              (iii) becomes available to Executive  subsequent to his employment
     by the Corporation on a nonconfidential  basis from a source other than the
     Corporation  or its  agents  which  source  has a right  to  disclose  such
     information; or

              (iv)  results  from  research and  development  and/or  commercial
     operations  at any time by or on behalf  of any  person,  company  or other
     entity with which or with whom  Executive  shall  become  associated  (in a
     manner  consistent  with the  terms of this  Agreement)  subsequent  to his
     employment by the  Corporation or its agents totally  independent  from any
     disclosure from the Corporation or its agents.

                   (c)  Notwithstanding   anything  to  the  contrary  contained
herein,  in the event that Executive  becomes legally  compelled to disclose any
confidential  information,  Executive will provide the  Corporation  with prompt
notice so that the Corporation may seek a protective order or other  appropriate
remedy. In the event that such protective order or other remedy is not obtained,
Executive  shall  furnish only such  confidential  information  which is legally
required to be disclosed.

              10. INTELLECTUAL  PROPERTY.  Any idea, invention,  design, written
material,  manual,  system,  procedure,  improvement,  development  or discovery
conceived,  developed, created or made by Executive alone or with others, during
the period of his  employment  hereunder  and  applicable to the business of the
Corporation  or  any  of  its   subsidiaries,   whether  or  not  patentable  or
registrable,  shall become the sole and exclusive property of the Corporation or
such  subsidiary.  Executive  shall disclose the same promptly and completely to
the Corporation and shall, during the period of his


                                       6
<PAGE>
employment  hereunder and at any time and from time to time hereafter at no cost
to Executive (i) execute all documents  reasonably  requested by the Corporation
for vesting in the  Corporation  or any of its  subsidiaries  the entire  right,
title and  interest in and to the same,  (ii) execute all  documents  reasonably
requested by the Corporation for filing and prosecuting  such  applications  for
patents, trademarks,  service marks and/or copyrights as the Corporation, in its
sole  discretion,  may desire to prosecute,  and (iii) give the  Corporation all
assistance  it  reasonably  requires,  including  the giving of testimony in any
suit,  action or  proceeding,  in order to  obtain,  maintain  and  protect  the
Corporation's right therein and thereto.

              11.  EQUITABLE  RELIEF.   The  parties  hereto   acknowledge  that
Executive's  services  are  unique  and  that,  in the  event of a  breach  or a
threatened  breach by Executive of any of his obligations  under Paragraphs 8, 9
or 10 this Agreement,  the Corporation shall not have an adequate remedy at law.
Accordingly,  in the event of any such breach or threatened breach by Executive,
the Corporation shall be entitled to such equitable and injunctive relief as may
be  available  to  restrain  Executive  and  any  business,  firm,  partnership,
individual,  corporation  or entity  participating  in such breach or threatened
breach from the  violation  of the  provisions  of  Paragraph 8, 9 or 10 hereof.
Nothing herein shall be construed as prohibiting the  Corporation  from pursuing
any other  remedies  available at law or in equity for such breach or threatened
breach,  including the recovery of damages and the immediate  termination of the
employment of Executive hereunder, if and to the extent permitted hereunder.

              12.   TERMINATION   OF  AGREEMENT;   TERMINATION   OF  EMPLOYMENT;
SEVERANCE;  SURVIVAL.  (a) This Agreement and Executive's  employment  hereunder
shall terminate upon the first to occur of the following: (i) Executive becoming
Disabled  (as that term is defined in  Paragraph  13 hereof);  (ii)  Executive's
death; (iii) termination of Executive's  employment by the Corporation for Cause
or pursuant to  subparagraph  (b) of this  Paragraph  12;  (iv)  termination  of
Executive's  employment  for  Employer  Breach and (v) the  termination  of this
Agreement  at the end of the  term of this  Agreement  on the  Termination  Date
pursuant to Paragraph 3.

                   (b)  Notwithstanding  anything to the  contrary  contained in
this Agreement, in the event of the termination of the Executive's employment by
the Corporation for any reason (other than for Cause), Executive shall be paid a
severance  payment equal to 75% of  Executive's  then current annual base salary
payable in nine equal monthly  installments,  with the first  installment  being
payable on the date  falling  two weeks after the date of such  termination  and
each  additional  installment  being paid every month after such date until such
severance is paid in full. In the event of such  termination of the  Executive's
employment by the Corporation (other than for Cause), the Corporation shall have
no further  obligation  to the  Executive  under this  Agreement  other than the
Corporation's  obligation  (i) to make such  severance  payment to the Executive
(ii) to pay Executive's COBRA premium payments for


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<PAGE>
hospitalization  and medical insurance  coverage provided by the Corporation and
to pay  Executive's  premiums on any death  and/or  disability  insurance  being
maintained by the Corporation for Executive at the time of such termination,  in
each case until the payment in full of such severance payments

                   (c)  Paragraph  5(c)  of this  Agreement  shall  survive  the
termination of Executive's  employment  hereunder  until the earlier to occur of
Executive's exercise of all of the stock options granted pursuant to paragraph 5
and the  expiration  of all such  stock  options  pursuant  to the Stock  Option
Letters.  Paragraphs 7, 8, 9, 10, 11 and 26 of this Agreement  shall survive the
termination  of  Executive's  employment  hereunder,   except  in  the  case  of
termination pursuant to Paragraph 15.

              13.  DISABILITY.  In  the  event  that  during  the  term  of  his
employment by the  Corporation  Executive shall become Disabled (as that term is
hereinafter  defined)  he shall  continue to receive the full amount of the base
salary to which he was theretofore  entitled for a period of six months after he
shall be deemed to have become Disabled (the "First Disability Payment Period").
If the First Disability  Payment Period shall end prior to the Termination Date,
Executive thereafter shall be entitled to receive salary at an annual rate equal
to 80% of his then  current  base  salary  for a  further  period  ending on the
earlier of (i) six months  thereafter or (ii) the Termination  Date (the "Second
Disability  Payment  Period").  Upon the  expiration  of the  Second  Disability
Payment Period,  Executive shall not be entitled to receive any further payments
on account of his base salary until he shall cease to be Disabled and shall have
resumed his duties  hereunder and provided that the  Corporation  shall not have
theretofore  terminated this Agreement as hereinafter provided.  The Corporation
may terminate  Executive's  employment  hereunder at any time after Executive is
Disabled, upon at least 10 days' prior written notice;  PROVIDED,  HOWEVER, that
such  termination  shall not relieve the Corporation from its obligation to make
the payments to Executive described above in this Paragraph 13. For the purposes
of this Agreement, Executive shall be deemed to have become Disabled when (x) by
reason of physical or mental  incapacity,  Executive  is not able to perform his
duties  hereunder  for a period  of 90  consecutive  days or for 120 days in any
consecutive  180-day  period or (y) when  Executive's  physician  or a physician
designated by the Corporation  shall have determined that Executive shall not be
able,  by reason of  physical  or mental  incapacity,  to perform a  substantial
portion of his duties  hereunder.  In the event that Executive shall dispute any
determination of his disability pursuant to clauses (x) or (y) above, the matter
shall be resolved by the determination of three physicians qualified to practice
medicine  in the United  States of  America,  one to be  selected by each of the
Corporation  and  Executive  and the  third  to be  selected  by the  designated
physicians.  If Executive  shall receive  benefits under any  disability  policy
maintained by the Corporation,  the Corporation  shall be entitled to deduct the
amount  equal to the  benefits  so received  from base salary that it  otherwise
would have been required to pay to Executive as provided above.


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<PAGE>
              14.  TERMINATION  FOR CAUSE.  The Corporation may at any time upon
written notice to Executive  terminate  Executive's  employment  for Cause.  For
purposes of this  Agreement,  the  following  shall  constitute  Cause:  (i) the
willful  and  repeated  failure of  Executive  to perform  any  material  duties
hereunder or gross  negligence of Executive in the  performance  of such duties,
and if such failure or gross negligence is susceptible to cure by Executive, the
failure to effect such cure within twenty (20) days after written notice of such
failure or gross  negligence  is given to  Executive;  (ii) except as  permitted
hereunder,  unexplained,  willful and regular  absences  of  Executive  from the
Corporation;  (iii) excessive use of alcohol or illegal drugs,  interfering with
the performance of Executives duties  hereunder;  (iv) indictment for a crime of
theft, embezzlement,  fraud, misappropriation of funds, other acts of dishonesty
or the violation of any law or ethical rule relating to Executive's  employment;
(v) indicted for any other felony or other crime  involving  moral  turpitude by
Executive;  or  (vi)  the  breach  by  Executive  of any of  the  provisions  of
paragraphs  8, 9 or 10 and if such breach is  susceptible  of cure by Executive,
the failure to effect such cure within twenty (20) days after written  notice of
such breach is given to  Executive.  For purposes of this  Agreement,  an action
shall  be  considered  "willful"  if  it is  done  intentionally,  purposely  or
knowingly,   distinguished  from  an  act  done  carelessly,   thoughtlessly  or
inadvertently.  In any such  event,  Executive  shall be entitled to receive his
base salary to and including the date of termination.

              15.  TERMINATION FOR EMPLOYER  BREACH.  Executive may upon written
notice to the Corporation  terminate this Agreement (including  paragraphs 8, 9,
10 and  11) in the  event  of the  breach  by the  Corporation  of any  material
provision of this  Agreement,  and if such breach is  susceptible  of cure,  the
failure to effect such cure within 20 days after  written  notice of such breach
is  given  to the  Corporation  (an  "Employer  Breach").  Executive's  right to
terminate  this  Agreement  under this  Paragraph 15 shall be in addition to any
other remedies  Executive may have under law or equity.  Paragraphs  2(d), 7 and
12(b) of this  Agreement  shall  survive the  termination  of this  Agreement by
Executive pursuant to this Paragraph 15.

              16. INSURANCE POLICIES.  The Corporation shall have the right from
time to time to purchase,  increase,  modify or terminate  insurance policies on
the life of Executive for the benefit of the Corporation, in such amounts as the
Corporation  shall determine in its sole  discretion.  In connection  therewith,
Executive  shall,  at such  time or times  and at such  place or  places  as the
Corporation may reasonably direct,  submit himself to such physical examinations
and execute and deliver such documents as the  Corporation  may reasonably  deem
necessary or desirable.

              17. ENTIRE AGREEMENT;  AMENDMENT.  This Agreement  constitutes the
entire  agreement of the parties  hereto,  and any prior  agreement  between the
Corporation  and  Executive  is  hereby  superseded  and  terminated   effective
immediately  and shall be without  further  force or  effect.  No  amendment  or
modification


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<PAGE>
himself shall be valid or binding unless made in writing and signed by the party
against whom enforcement thereof is sought.

              18. NOTICES. Any notice required, permitted or desired to be given
pursuant to any of the provisions of this Agreement shall be delivered in person
or sent by responsible  overnight  delivery  service or sent by certified  mail,
return receipt requested,  postage and fees prepaid,  if to the Corporation,  at
its  address  set  forth  above  to the  attention  of the  Corporation's  Chief
Financial Officer and, if to Executive,  at his address set forth above.  Either
of the  parties  hereto may at any time and from time to time change the address
to which notice shall be sent hereunder by notice to the other party given under
this Paragraph 18. Notices shall be deemed effective upon receipt.

              19. NO ASSIGNMENT; BINDING EFFECT. Neither this Agreement, nor the
right to receive any payments hereunder, may be assigned by either party without
the other party's prior written  consent.  This Agreement  shall be binding upon
Executive, his heirs, executors and administrators and upon the Corporation, its
successors and assigns.

              20.  WAIVERS.  No course of  dealing  nor any delay on the part of
either party in exercising any rights hereunder shall operate as a waiver of any
such  rights.  No waiver of any  default  or breach of this  Agreement  shall be
deemed a continuing waiver or a waiver of any other breach or default.

              21.  GOVERNING  LAW.  This  Agreement  shall  be  governed  by and
construed in accordance with the laws of the State of New York, except that body
of law relating to choice of laws.

              22. INVALIDITY. If any clause, paragraph,  section or part of this
Agreement  shall be held or  declared to be void,  invalid or  illegal,  for any
reason,  by any  court  of  competent  jurisdiction,  such  provision  shall  be
ineffective  but shall not in any way  invalidate  or affect  any other  clause,
paragraph, section or part of this Agreement.

              23.  FURTHER  ASSURANCES.  Each of the parties  shall execute such
documents  and take such other  actions as may be  reasonably  requested  by the
other  party to carry out the  provisions  and  purposes  of this  Agreement  in
accordance with its terms.

              24. HEADINGS.  The headings  contained in this Agreement have been
inserted  for  convenience  only and shall not affect in any way the  meaning or
interpretation of this Agreement.

              25. PUBLICITY.  The Corporation and Executive agree that they will
not make any press  releases or other  announcements  prior to or at the time of
execution  of this  Agreement  with  respect to the terms  contemplated  hereby,
except as required by applicable  law,  without the prior  approval of the other
party, which approval will not be unreasonably withheld.


                                       10
<PAGE>
              26.  ARBITRATION.  Any disputes arising under this Agreement shall
be  submitted  to and  determined  by  arbitration  in New York City,  New York;
PROVIDED, HOWEVER, that such arbitration shall be held in St. Louis, Missouri in
the event that the Company's  principal executive offices is located at the time
of such dispute in St. Louis,  Missouri.  Such arbitration shall be conducted in
accordance with the rules of the American Arbitration Association.  Any award or
decision  of the  arbitration  shall be  conclusive  in the absence of fraud and
judgment thereon may be entered in any court having  jurisdiction  thereof.  The
costs  of such  arbitration  shall  be paid by the  non-prevailing  party to the
extent directed by the arbitrator(s).

THIS AGREEMENT CONTAINS BINDING ARBITRATION  PROVISIONS WHICH MAY BE ENFORCED BY
THE PARTIES.


                                       11
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              IN WITNESS WHEREOF,  the parties hereto have caused this Agreement
to be duly executed as of the day and year first above written.

                                   SHEFFIELD MEDICAL TECHNOLOGIES INC.


                                   By: /s/ George Lombardi
                                       -------------------------------
                                       George Lombardi
                                       Vice President and Chief
                                       Financial Officer


                                       /s/ Loren G. Peterson
                                       -------------------------------
                                       Loren G. Peterson