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EXHIBIT 10.1

         SECOND AMENDED AND RESTATED LICENSE AND DISTRIBUTION AGREEMENT

         This Second Amended and Restated License and Distribution Agreement
(the "AGREEMENT" or "ARDA II") is entered into as of March 1, 1999 by and
between Mallinckrodt Inc., a Delaware corporation with an address at 675
McDonnell Boulevard, Post Office Box 5840, St. Louis, Missouri 63134
("MALLINCKRODT"), and Molecular Biosystems, Inc., a Delaware corporation with
an address at 10030 Barnes Canyon Road, San Diego, California 92121 ("MBI").
This Agreement is effective when signed by the parties, except as provided in
SECTION 16.13.

RECITALS

         A.    Mallinckrodt and MBI are parties to a Distribution Agreement
dated as of December 7, 1988, as amended by an Agreement dated November 7,
1989 (the "ORIGINAL DISTRIBUTION AGREEMENT", and as amended and restated by an
Agreement dated September 7, 1995 (as amended, "ARDA").

         B.    Mallinckrodt and MBI entered into an Amendment No. 1 to ARDA on
November 4, 1996 (the "NYCOMED TERRITORY AMENDMENT"), and an Amendment to the
Nycomed Territory Amendment on November 4, 1996 (the "SUPPLEMENTAL LETTER").

         C.    Under ARDA, as amended by the Nycomed Territory Amendment and
the Supplemental Letter, Mallinckrodt acted solely as a distributor of MBI's
products. The parties now desire that Mallinckrodt manufacture products
formerly supplied to it by MBI.

         D.    Mallinckrodt and MBI desire to amend and restate ARDA, as
amended by the Nycomed Territory Amendment and the Supplemental Letter, to
reflect this change in the commercial relationship between the parties through
this Agreement, which Agreement supercedes those prior agreements between the
parties.

         Now, therefore, in consideration of their mutual promises, the
parties agree as follows:

                                    ARTICLE 1

                                   DEFINITIONS

         As used in this Agreement, the following terms shall have the
meanings specified below:

         1.01 ADDITIONAL TERRITORY shall mean all of the countries of the
world except the countries included in the Territory , the Nycomed Territory
and the countries represented by the Shionogi Territory.

         1.02 AFFILIATE shall mean with respect to a corporation, association,
partnership, individual, trust or unincorporated organization, any other
corporation, association, partnership, individual, trust or unincorporated
organization that, directly or indirectly, controls, is controlled by or under
common control with such corporation, association, partnership, individual,
trust or unincorporated organization.

         1.03 AGGREGATE NET SALES, as used in SECTIONS 3.02F AND 4.02(b) of
this Agreement, means the sum of Mallinckrodt's Net Sales of each Separate
Product plus the net sales (calculated in the same manner as Mallinckrodt's
Net Sales) of the Separate Product in question by Mallinckrodt's Affiliates.

         1.04 AGREEMENT shall mean this Second Amended and Restated License
and Distribution Agreement ("ARDA II"), as amended from time to time.

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         1.05 ALBUNEX shall mean any product for medical applications,
including all modifications and improvements related thereto, that is an "in
vivo" contrast agent for ultrasound and echocardiography diagnostic imaging
and (a) that is covered by or described in, or manufactured in accordance with
a process covered by or described in, any patent or pending patent application
included in APPENDIX 2, (b) that is functionally similar to a product included
in (a) above and is currently in the possession or control (by license or
otherwise) of MBI, (c) that could be made pursuant to any process referred to
in (a) above, whether or not it is in fact made by that process, or (d) that
consists of microbubbles or hollow microspheres made of a biocompatible
material.

         The term "ALBUNEX" includes (but is not limited to) products
consisting of sonicated albumin microspheres containing a perfluorocarbon in
gaseous form and specifically includes the product consisting of sonicated
albumin microspheres containing perfluoropropane which MBI has code-named
"FS069" ("FS"), and which is being commercially sold under the trademark
"OPTISON"-Registered Trademark-.

         1.06 ALBUNEX PRODUCT means each vial size of ALBUNEX manufactured for
commercial sale for which the manufacturer assigns a separate identifying
number. Each vial size of ALBUNEX manufactured for commercial sale shall be
assigned a separate identifying number for each country in which vials of that
size are sold or to be offered for sale. If a particular vial size is labeled
in a manner that permits vials of that size to be sold in more than one
country, a single identifying number shall be assigned in respect of all such
countries.

         1.07 ASIAN TERRITORY means, collectively, the countries of Japan,
Korea and Taiwan.

         1.08 AVERAGE SELLING PRICE means, for each Albunex Product which is
sold during any calendar quarter, the quotient obtained by dividing (i) the
Net Sales of that Albunex Product during the quarter by (ii) the number of
vials of that Albunex Product shipped to purchasers during the quarter
(including vials given away in order to provide a discounted purchase price
and vials distributed as samples, but not including vials shipped at no charge
for preclinical and clinical trials). The Average Selling Price for each
Albunex Product which is labeled in a manner that permits vials of that
product to be sold in more than one country shall be determined on a
sales-weighted basis by taking into account the aggregate Net Sales of that
Albunex Product in all such countries during the quarter (i.e., the Average
Selling Price shall not be determined by averaging the Average Selling Price
for each such country).

         1.09 CLINICAL REVIEW is defined in SECTION 2.16(1).

         1.10 CONFIDENTIAL INFORMATION shall mean (a) any data or information
relating to ALBUNEX that is competitively sensitive material, and not
generally known to the public, such as, but not limited to, product planning
information, marketing strategies, sales estimates, business plans, and
internal performance results relating to ALBUNEX; (b) any scientific or
technical information, design, process, procedure, formula, or improvement
relating to ALBUNEX that is commercially valuable and secret in the sense that
its confidentiality affords the disclosing party a competitive advantage over
its competitors, including without limitation, the manufacturing techniques,
sources of raw material and composition of matter relating to ALBUNEX; and (c)
all confidential or proprietary concepts, inventions, and information relating
to ALBUNEX, including but not limited to know-how and trade secrets relating
to ALBUNEX. Confidential Information includes without limitation, all
documents, inventions, substances, engineering and laboratory notebooks,
drawings, specifications, bills of material, equipment, prototypes and models
relating to ALBUNEX, and any other tangible manifestation of the foregoing
which now exist or come into the control or possession of the party.

         1.11 CONTRACT RESEARCH ORGANIZATION OR CRO shall mean a person or
entity that assumes, as an independent contractor of a sponsor of a clinical
trial, one or more of the obligations of the sponsor, including but not
limited to, design of a protocol, selection of clinical sites, monitoring of
investigations, evaluation of reports and preparation of materials to be
submitted to the FDA or Foreign Equivalent Authorities.

         1.12 FIRST GENERATION PRODUCT means ALBUNEX with substantially the
same specifications and other characteristics first approved and released for
sale in the United States on October 17, 1994.

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         1.13 DR. FEINSTEIN means Steven B. Feinstein, M.D., or, as the
context may require, his designee for payments under the Feinstein License.

         1.14 EFFECTIVE DATE is defined in SECTION 16.13.

         1.15 FDA shall mean the United States Food and Drug Administration,
or any successor agency thereto.

         1.16 FEINSTEIN LICENSE means the License Agreement, dated as of
November 5, 1986, as Restated on June 1, 1989, between MBI and Dr. Feinstein,
and as amended by a letter agreement dated June 14, 1994 (relating to Dr.
Feinstein's designation of a different payee for MBI's payments).

         1.17 FILL OPERATIONS means the act of filling vials and packaging
OPTISON products.

         1.18 FORCE MAJEURE shall mean any act or occurrence beyond the
reasonable control of a party that prevents its performance of any covenant or
obligation under this Agreement including without limitation: (a) lightning,
storms, earthquakes, landslides, flood, washouts, or other acts of God; (b)
fires, explosions, or breakage of or accidents to plant, machinery, equipment,
or storage; (c) shortage of necessary labor, strikes, lockouts, or other labor
disturbances; (d) civil disturbances, sabotage, war, blockades, insurrections,
vandalism, riots, or epidemics; (e) acts of any governmental agency or
military authority; (f) unavailability of utilities or transportation; or, (g)
any other cause, whether enumerated herein or otherwise, that is not
reasonably within the control of the party claiming suspension, which by the
exercise of due diligence, such party is unable to overcome. Notwithstanding
the foregoing, the lack of finances for whatever reason shall in no event be,
or be deemed to be, a cause beyond the party's control.

         1.19 FORECAST is defined in SECTION 2.05(b).

         1.20 FOREIGN EQUIVALENT AUTHORITIES shall mean the organization,
body, or entity of any country outside the United States that performs
functions equivalent to the functions performed by the FDA in the United
States.

         1.21 INFOSON means ALBUNEX as developed by Nycomed as of the
Effective Date, having the specifications previously approved for sale in the
United Kingdom.

         1.22 JOINT STEERING COMMITTEE is defined in SECTION 2.16.

         1.23 KNOW-HOW shall mean complete information concerning ALBUNEX,
including but not limited to (a) all Confidential Information of a technical
nature relating to ALBUNEX, (b) all useful pre-clinical, clinical and other
data respecting the safety and efficacy of ALBUNEX, (c) all the records of
case histories of use, medical evaluations, submissions to and correspondence
with the FDA and corresponding foreign agencies relating to ALBUNEX, and (d)
all useful technical data and information, including but not limited to all
documents and prototypes and models actually provided to Mallinckrodt by MBI,
relating to formulas for and the manufacture, use or sale of ALBUNEX owned,
controlled or licensed by MBI which is necessary to or helpful to (i) enable
Mallinckrodt most efficiently to manufacture, use or sell ALBUNEX, or (ii)
obtain any governmental approval to sell ALBUNEX.

         1.24 LAUNCH DATE shall mean October 17, 1994, which was the date that
Mallinckrodt first released the First Generation Product to its sales force
for commercial sale after the FDA issued its initial approval letter for
ALBUNEX. (FOR HISTORICAL PURPOSES ONLY)

         1.25 LOSS shall mean any liability, loss, cost, damage, cost of
settlement in connection with any claim of settlement, or actual expense
reasonably incurred (including, without limitation, reasonable and appropriate
attorneys' fees) sustained by the indemnified party, together with any related
interest and penalties.

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         1.26 MALLINCKRODT shall mean Mallinckrodt Inc., a Delaware
corporation (which is the successor in interest to Mallinckrodt Medical, Inc.
as a party to this Agreement).

         1.27 MANUFACTURING OPERATIONS shall mean all activities which are
required to manufacture OPTISON so that it meets all legal requirements for
sale in the Territory, the Additional Territory, or the Nycomed Territory.

         1.28 MANUFACTURING REVIEW is defined in SECTION 2.16(3).

         1.29 MARKETING REVIEW is defined in SECTION 2.16(2).

         1.30 MBI shall mean Molecular Biosystems, Inc., a Delaware
corporation.

         1.31 MBI LICENSED PRODUCT shall mean any ultrasound contrast agent,
the manufacture, use or sale of which is covered by any issued claim or claims
of any unexpired patents within the Technology Rights as defined in Section
1.50.

         1.32 MBI'S MANUFACTURING OBLIGATIONS means MBI's manufacturing and
delivery obligations and covenants in SECTIONS 2.02, 2.03, 2.04(b), (c), (d)
AND (e), 2.06, 2.07, 2.09(c), 2.13 AND 6.02(i) AND (j).

         1.33 MBI TRADEMARKS shall mean the trademarks, including the
registrations and applications therefor listed in APPENDIX 1, together with
any other trademarks, registrations or applications similar to the
"ALBUNEX(R)" mark.

         1.34 NDA shall mean with respect to any formulation or indication of
ALBUNEX a New Drug Application as required to be filed with the FDA.

         1.35 NET SALES shall mean, for each Albunex Product, the aggregate
gross sales in money of that Albunex Product by Mallinckrodt or its Affiliates
to purchasers who are not Affiliates of Mallinckrodt, less the aggregate
related (i) allowances for spoiled, damaged, out-of-date (under SECTION
2.04(e)), out-of-specification (in respect of specifications required by this
Agreement), recalled or returned vials (if the spoilage, damage, being
out-of-date or out-of-specification, recall or return is due to the fault of
MBI during Phases 1 and 2), (ii) trade, quantity and cash discounts and
rebates allowed, (iii) all sales, use and excise taxes and duties paid, and
(iv) transportation and handling charges paid. For any Net Sales in a currency
other than United States dollars, the amount of such Net Sales shall be
computed using the average of the daily exchange rates for the month of sale,
as reported by Citibank or any other exchange rate reporting service or
commercial source selected by Mallinckrodt and approved by MBI (which shall
not unreasonably withhold its approval), provided that Mallinckrodt shall not
select another reporting service or commercial source arbitrarily or for the
purpose of gaining an exchange rate more favorable to it than the exchange
rate reported by the Citibank.

         1.36 NYCOMED means Nycomed AS or its successor in interest under the
Nycomed Agreement.

         1.37 NYCOMED AGREEMENT means the License and Cooperative Development
Agreement dated as of December 31, 1987, between MBI and Nycomed AS, as
amended by a Letter Agreement dated as of February 20, 1989, as amended by an
Amendment dated as of June 15, 1989, and as amended by an Amendment No. 3
dated as of October 24, 1995.

         1.38 NYCOMED LICENSE AMENDMENT means Amendment No. 3 to the License
and Cooperative Development Agreement, entered into by MBI and Nycomed AS as
of October 24, 1995, pursuant to which MBI reacquired substantially all of
Nycomed's ALBUNEX rights in the Nycomed Territory.

         1.39 NYCOMED TERRITORY means the "Territory" as defined in the
Nycomed Agreement and as listed in APPENDIX II to the Nycomed Agreement (as
APPENDIX II has been amended to include India).

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         1.40 NYCOMED TERRITORY AMENDMENT means that Amendment No. 1 to ARDA
entered into by Mallinckrodt Medical, Inc. and MBI on November 4, 1996.

         1.41 PHASE 1 for each country means the period beginning on the
effective date of ARDA II and ending when the Joint Steering Committee shall
determine, on a country-by-country basis, that Mallinckrodt's plant is
validated to perform Fill Operations as that term is defined in SECTION 1.17.

         1.42 PHASE 2 for each country means the period beginning when
Mallinckrodt's plant is validated to perform Fill Operations on a
country-by-country basis and ending when the Steering Committee shall
determine, on a country-by-country basis, that Mallinckrodt's plant is fully
validated to perform all Manufacturing Operations related to the manufacture
of OPTISON.

         1.43 PHASE 3 for each country means the period beginning when the
Joint Steering Committee shall determine, on a country-by-country basis, that
Mallinckrodt's plant is fully validated to perform all Manufacturing
Operations related to the manufacture of OPTISON and continuing so long as
Mallinckrodt has a right to manufacture ALBUNEX.

         1.44 PLAINTIFFS shall mean Alliance Pharmaceutical Corp., Bracco
International BV, DuPont Pharmaceuticals, ImaRx Pharmaceutical Corporation,
Nycomed, Sonus Pharmaceuticals, Inc. and Schering AG or any of their
Affiliates or partners.

         1.45 PMA shall mean with respect to any formulation or indication of
ALBUNEX a Pre-Market Approval submission as required to be filed with the FDA.

         1.46 PRODUCT LITERATURE shall mean the product literature for ALBUNEX
developed pursuant to SECTION 2.10.

         1.47 PRODUCT SPECIFICATIONS shall mean the specifications for ALBUNEX
to be supplied by MBI as in effect from time to time as provided in SECTION
2.02.

         1.48 SEPARATE PRODUCT is defined in SECTION 3.02D of the Nycomed
Territory Amendment.

         1.49 SHIONOGI TERRITORY is defined as Japan, The Republic of China
(Taiwan), and the Republic of South Korea, together with all their territories
and possessions.

         1.50 TECHNOLOGY RIGHTS licensed pursuant to this Agreement shall mean
all of the following:

         (a) Those patents and patent applications, if any, in the Territory,
the Additional Territory and the Nycomed Territory, as currently set forth in
APPENDIX 2, together with any patent which may be issued thereunder, and any
divisional, continuation or continuation-in-part applications based thereon,
and any patents resulting from any of said applications and any reissues,
reexaminations or extensions based on any of such patents, and any equivalent
patents and patent applications in countries of the Territory, the Additional
Territory and the Nycomed Territory;

         (b) Any other patents or patent applications in countries of the
Territory, the Additional Territory and the Nycomed Territory, or Know-how
presently owned, controlled or licensed by, being developed or subsequently
developed or acquired (under license or otherwise) by, MBI which relate
directly to ALBUNEX and its manufacture or use; and

         (c) Any FDA applications and approvals held or owned by MBI to which
Mallinckrodt is granted the right to reference pursuant to SECTION 2.01,
including but not limited to INDs, NDAs, PMAs and IDEs.

         1.51 TECHNOLOGY TRANSFER COSTS are defined in SECTION 2.03(a).

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         1.52 TECHNOLOGY TRANSFER PERIOD is defined in SECTION 2.03(a).

         1.53 TECHNOLOGY TRANSFER TEAM is defined in SECTION 2.03(A).

         1.54 TERRITORY shall mean all countries, territories and possessions
located in North America, Central America or South America, excluding
Greenland.

                                    ARTICLE 2

                             MANUFACTURE OF ALBUNEX

         2.01 REGULATORY MATTERS.

         (a) All applications submitted to the FDA (or Foreign Equivalent
Authorities) relating to ALBUNEX shall be in compliance with all FDA's (or
Foreign Equivalent Authorities') regulations and requirements. All activities
necessary for the commercialization of ALBUNEX under this ARTICLE 2, including
but not limited to pre-clinical and clinical trials, pre-marketing activities
and pre-production activities, shall be conducted in a commercially reasonable
manner and in accordance with accepted industry standards. Clinical trials and
other studies shall be conducted in accordance with applicable FDA (or Foreign
Equivalent Authorities') requirements and procedures, including but not
limited to Good Laboratory Practices and Good Clinical Practices (as those
terms are defined pursuant to industry standards).

         (b) Timing of the preparation and submission of all FDA (or foreign
equivalent) applications shall be as mutually agreed by Mallinckrodt and MBI.
Beginning on the Effective Date, Mallinckrodt will reimburse MBI for fees,
expenses and charges MBI incurs with respect to all FDA or foreign equivalent
applications for cardiac and radiological clinical trials for OPTISON. These
expenses may include, but are not limited to, external fees, internal
personnel costs and CRO costs ("CLINICAL EXPENSES"). Notwithstanding the
foregoing, all Clinical Expenses (i) must be budgeted by MBI and such budgets
must be reviewed and approved in advance by the Joint Steering Committee, (ii)
will be billed monthly and reviewed and paid by Mallinckrodt within 45 days of
receipt, and (iii) are subject to periodic audits by Mallinckrodt similar to
the audit right given to MBI by SECTION 2.14(c). In addition to the budget MBI
must prepare pursuant to SECTION 2.01(b)(i), MBI shall also prepare a 12 month
rolling forecast of Clinical Expenses and submit such forecast to Mallinckrodt
no later than the due date stated in Mallinckrodt's published forecast
schedule.

         (c) Notwithstanding the first sentence of SECTION 2.01(b) and
SECTIONS 2.01(d) AND (e), MBI shall, under the direction of the Joint Steering
Committee and working in conjunction with employees of Mallinckrodt:

                  (1) complete the initial Phase III of the Human Clinical
         Trials for the indication of ALBUNEX specified in APPENDIX 4 (the
         First Generation Product). MBI shall file with the FDA an NDA or PMA
         application relating to the First Generation Product as soon as
         practicable; and [FOR HISTORICAL PURPOSES ONLY]

                  (2) implement or conduct activities necessary to obtain FDA
         approvals for (i) all cardiac indications of OPTISON, and (ii) all
         radiological indications of OPTISON.

         All FDA or foreign equivalent activities under this SECTION 2.01(c)
are subject to the review and approval of the Joint Steering Committee. MBI
shall include Mallinckrodt as an alternative manufacturing site in all
relevant submissions and applications to the FDA. Mallinckrodt shall provide
reasonable assistance to MBI in connection with any application or submission
to the FDA by MBI pursuant to this SECTION 2.01(c), including but not limited
to, NDA or PMA application relating, but not limited to, the First Generation
Product. Mallinckrodt shall have the right to review and approve any
application or submission to the FDA by MBI pursuant to this SECTION 2.01(c),
including the NDA or PMA application or IDE ("INVESTIGATIONAL DEVICE
EXEMPTION") for any formulation of ALBUNEX, prior to submission to the FDA,
which approval shall not be unreasonably withheld or delayed. MBI shall also

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promptly take appropriate steps to enable Mallinckrodt to reference or
otherwise have the benefit of all approvals and applications that MBI obtains
or submits under this SECTION 2.01. Notwithstanding the foregoing,
Mallinckrodt shall not transfer INDs, NDAs, PMAs or IDEs related to
radiological indications to MBI. Following termination of this Agreement,
Mallinckrodt shall have the continued right to (i) reference the applications,
(ii) file supplemental applications and (iii) use the applications in any
other way that Mallinckrodt deems necessary, and MBI shall have the obligation
to maintain all NDAs, PMAs and IDEs, for so long as Mallinckrodt continues to
make or sell ALBUNEX.

         (d) Mallinckrodt shall be responsible for obtaining all FDA approvals
and conducting any activities related thereto, including but not limited to
pre-clinical and clinical trials, for any indication of ALBUNEX (other than
those which MBI has or undertakes responsibility for pursuant to SECTION
2.01(c)) which Mallinckrodt determines, in its judgment after consultation
with MBI, has a reasonable market opportunity to support the anticipated
expenses associated with obtaining the FDA regulatory approvals for such
indication. MBI shall provide reasonable assistance to Mallinckrodt in
connection with any application or submission to the FDA by Mallinckrodt
pursuant to this SECTION 2.01(d). MBI shall have the right to review and
approve any application or submission to the FDA by Mallinckrodt pursuant to
this SECTION 2.01(d) prior to submission to the FDA, which approval shall not
be unreasonably withheld or delayed. Mallinckrodt shall include MBI as an
alternative manufacturing site, as Mallinckrodt deems necessary or as
required, in all relevant submissions and applications to the FDA. At MBI's
request, Mallinckrodt shall also promptly take appropriate steps to enable MBI
to reference or otherwise have the benefit of all approvals and applications
that Mallinckrodt obtains or submits under this SECTION 2.01(d) in respect of
all ALBUNEX developed by MBI, or jointly by MBI and Mallinckrodt, if and when
MBI terminates this Agreement pursuant to SECTIONS 14.02(b), (d) OR (f).

         (e) Mallinckrodt shall be responsible for obtaining all approvals of
any Foreign Equivalent Authorities in (i) any country in the Territory other
than the United States of America and (ii) any country in the Additional
Territory and the Nycomed Territory, and conducting any activities related
thereto, including but not limited to preclinical and clinical trials, for any
indication of ALBUNEX which Mallinckrodt determines, in its judgment after
consultation with MBI, has a reasonable market opportunity in such country to
support the anticipated expense associated with obtaining the applicable
regulatory approvals for such indication. Mallinckrodt shall not be required
to obtain any approval which Nycomed has obtained or which it is required to
obtain under the Nycomed Agreement, if (i) Mallinckrodt is permitted by the
applicable Foreign Equivalent Authorities to reference the approval or if it
otherwise has or acquires the benefit of the approval and (ii) where the
approval has not yet been obtained, Nycomed, is proceeding diligently to
obtain the approval (as determined by Mallinckrodt in its judgment, after
consultation with MBI). MBI shall provide reasonable assistance to
Mallinckrodt in connection with any applicable application or submission by
Mallinckrodt pursuant to this SECTION 2.01(e). MBI shall have the right to
review and approve any application or submission to Foreign Equivalent
Authorities by Mallinckrodt pursuant to this SECTION 2.01(e) prior to
submission to Foreign Equivalent Authorities, which approval shall not be
unreasonably withheld or delayed. Mallinckrodt shall include MBI as an
alternative manufacturing site, as Mallinckrodt deems necessary or as
required, in all relevant submissions and applications to Foreign Equivalent
Authorities. At MBI's request (unless Mallinckrodt is prohibited by the
Nycomed License Amendment), Mallinckrodt shall also promptly take appropriate
steps to enable MBI to reference or otherwise have the benefit of all
approvals that Mallinckrodt obtains or submits under this SECTION 2.01(e) in
respect of all ALBUNEX developed by MBI, or jointly by MBI and Mallinckrodt,
if and when MBI terminates this Agreement pursuant to SECTIONS 14.02(b), (d)
OR (f).

         (f) MBI and Mallinckrodt shall promptly make available to the other
all pharmacological, toxicological, and clinical data and reports, stability
data, and similar information relating to any formulation or indication of
ALBUNEX now or hereafter known to, or possessed, acquired or developed by MBI
or jointly developed by MBI and Mallinckrodt.

         (g) Mallinckrodt shall have the right to participate in, and assist
MBI with, all activities MBI is required to take under SECTION 2.01,
including, but not limited to, preclinical and clinical trials, and to attend
and participate in MBI meetings with the FDA.

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         (h) All FDA cardiac and radiological approval activities (as
delegated by the Joint Steering Committee) must be conducted under the
supervision of MBI's Executive Vice President, Howard Dittrich, M.D., or such
other persons acceptable to Mallinckrodt. Subject to Dr. Dittrich's oversight,
all FDA radiological approval activities (as delegated by the Joint Steering
Committee) shall be under the supervision of Rubin Sheng, M.D., or such other
persons acceptable to Mallinckrodt. MBI will oversee the regulatory matters
related to the clinical programs MBI is responsible to manage, for so long as
MBI is managing such clinical programs. All other regulatory matters (as
delegated by the Joint Steering Committee) shall be under the direction of
James E. Keller of Mallinckrodt's Medical/Regulatory group or such other
person as Mallinckrodt may designate, however, Mallinckrodt may, at its
option, delegate some of these responsibilities to MBI. If Dr. Dittrich does
not perform the responsibilities assigned to him by the Joint Steering
Committee, then the Committee reserves the right, at its option, to withdraw
such delegation of responsibilities and to reassign all such approval
activities.

         2.02 PRODUCTS. During Phases 1 and 2, the products to be manufactured
by MBI pursuant to this ARTICLE 2 may, from time to time, change as the
parties agree to additional formulations of ALBUNEX to be manufactured by MBI
pursuant to this ARTICLE 2, or as the parties agree to modify the
specifications of ALBUNEX then manufactured by MBI pursuant to this ARTICLE 2
(collectively, the "SPECIFICATION CHANGES"). MBI and Mallinckrodt may make
Specification Changes from time to time by both parties executing an amendment
to APPENDIX 5. APPENDIX 5 contains the current specifications for ALBUNEX to
be manufactured pursuant to this ARTICLE 2.

         2.03 MANUFACTURE. During Phases 1 and 2, and subject to SECTION
2.14(D), MBI shall manufacture ALBUNEX for, or supply ALBUNEX to, Mallinckrodt
under the terms and conditions of this Agreement.

         (a) TECHNOLOGY TRANSFER. Beginning on the Effective Date, MBI and
Mallinckrodt, through the Joint Steering Committee, will develop a plan to
transfer all OPTISON manufacturing to a location controlled by Mallinckrodt as
of an agreed date ("TECHNOLOGY TRANSFER PERIOD"). All costs of establishing
the manufacturing facility, including but not limited to equipment, licensing
and validation shall be borne by Mallinckrodt ("TECHNOLOGY TRANSFER COSTS").
MBI shall render reasonable assistance to Mallinckrodt in developing
Mallinckrodt's Manufacturing Operations pursuant to the license granted in
SECTION 7.01(a). MBI shall assist Mallinckrodt at the latter's request and
expense, including, but not limited to, reimbursement of MBI for travel
expenses, direct labor costs of MBI personnel, equipment and any other related
expenses that are approved through the budget process of the Joint Steering
Committee. The persons from Mallinckrodt and MBI who are responsible for the
transfer of technology from MBI to Mallinckrodt pursuant to this Section
("TECHNOLOGY TRANSFER TEAM") shall work closely together to establish
reasonable purchasing policies, procedures and supply agreements with raw
material vendors. All costs borne by Mallinckrodt pursuant to this Section,
including those reimbursed to MBI, shall be included in Technology Transfer
Costs and both parties shall keep appropriate records of such costs.

         (b) MBI MANUFACTURING EXPENSES. Beginning on the Effective Date and
continuing during Phases 1 and 2, Mallinckrodt will reimburse MBI for all
fully-allocated manufacturing expenses ("MBI MANUFACTURING EXPENSES"),
including but not limited to, overhead, depreciation, direct materials,
interest and technology support during the Technology Transfer Period. To
qualify for reimbursement, MBI Manufacturing Expenses must be (i) budgeted by
MBI and reviewed and approved in advance by the Joint Steering Committee, (ii)
determined pursuant to Generally Accepted Accounting Principles ("GAAP"), with
the exception that royalties paid and accelerated depreciation taken by MBI
that would normally be includable in fully-allocated manufacturing expenses
consistent with GAAP will not be reimbursed, (iii) incurred by MBI in
manufacturing OPTISON for Mallinckrodt, and (iv) subject to verification and
periodic audits by Mallinckrodt similar to the right of audit afforded MBI
under SECTION 2.14(c). For purposes of subsection (ii) of this section, the
amount of accelerated depreciation excluded from MBI Manufacturing Expenses
shall be equal to the difference between (1) the accelerated depreciation
actually taken by MBI pursuant to GAAP and (2) the normal depreciation MBI
would have taken pursuant to GAAP assuming MBI had not taken accelerated
depreciation. In addition to the budget prepared by MBI pursuant to SECTION
2.03(b)(i), MBI shall also prepare a 12 month rolling forecast of MBI
Manufacturing Expenses and submit such forecast to Mallinckrodt no later than
the due date stated in Mallinckrodt's published forecast schedule.

         (c) MBI MANUFACTURING DURING PHASES 1 AND 2; MALLINCKRODT
MANUFACTURING DURING PHASE 3.

<PAGE>

                  (1) PHASE 1. During Phase 1, MBI shall continue to
         manufacture OPTISON for Mallinckrodt for countries designated by the
         Joint Steering Committee and subject to the Product Specifications
         contained in APPENDIX 5.

                  (2) PHASE 2. During Phase 2, MBI shall manufacture OPTISON
         for Mallinckrodt for countries designated by the Joint Steering
         Committee and subject to the Product Specifications contained in
         APPENDIX 5, and shall ship it to Mallinckrodt in flex bags.
         Mallinckrodt shall perform Fill Operations.

                  (3) PHASE 3. During Phase 3, Mallinckrodt shall manufacture
         OPTISON subject to the limitations in SECTIONS 2.03(c)(1), (c)(2), (d)
         AND 2.05.

                  (4) CONCURRENT PHASES. Notwithstanding the foregoing, the
         phases noted in SECTIONS 2.03(c)(1)-(3) are only mutually exclusive
         within a particular country, as plant validation must be performed and
         market authorization must be secured on a country-by-country basis in
         the Territory, the Additional Territory and the Nycomed Territory.

         (d) MBI RETENTION OF MANUFACTURING RIGHTS. Mallinckrodt shall have
the exclusive right and license to manufacture OPTISON in the Territory, the
Additional Territory and the Nycomed Territory. Notwithstanding the foregoing,
during Phases 1 and 2, MBI shall have the co-exclusive right to manufacture
OPTISON in the Territory, the Additional Territory and the Nycomed Territory,
but such manufacturing right shall only be exercised in order to manufacture
for Mallinckrodt.

         (e) ALBUMIN. At Mallinckrodt's request after it becomes authorized to
manufacture any Albunex Product under SECTIONS 2.03(c)(3) AND 7.01(a), MBI
shall authorize its vendor to use a portion of the vendor's allocation of USP
Human Serum Albumin to MBI to sell to Mallinckrodt for Mallinckrodt to
manufacture the Albunex Product in question in the authorized quantities or to
manufacture ALBUNEX as reasonably required in connection with Mallinckrodt's
limited validated manufacturing.

         2.04 DUTIES OF MBI.  MBI shall:

         (a) Promptly inform Mallinckrodt of any clinical trials reasonably
related to ALBUNEX approval and the results thereof and any problems in
starting production, and subject to the consent of MBI, which consent shall
not be unreasonably withheld or delayed, Mallinckrodt shall have the right to
participate in and assist MBI with any MBI pre-production activities;

         (b) During Phases 1 and 2, establish and maintain, with
Mallinckrodt's assistance, current Good Manufacturing Practices with respect
to the manufacturing of ALBUNEX in compliance with the requirements of the FDA
(or Foreign Equivalent Authorities) as such requirements shall be in effect
from time to time;

         (c) During Phases 1 and 2, ship the quantities of Albunex Products
ordered for the first two calendar quarters of each Forecast that Mallinckrodt
provides to MBI pursuant to SECTION 2.05(b), for delivery during those
quarters in a manner to assure product stability. MBI shall use its best
efforts to deliver the quantities ordered during the particular months of each
of those quarters as specified in the Forecast (but in any event shall deliver
the quantities ordered for each such quarter no later than the last day of the
quarter). In addition, MBI shall use best efforts to deliver amounts ordered
prior to the first Forecast provided by Mallinckrodt;

         (d) During Phases 1 and 2, prepare and deliver to Mallinckrodt a
complete and accurate documentation package (including current Good
Manufacturing Practices documentation and copies of any filings with the FDA
or corresponding foreign agencies in the Territory relating to ALBUNEX or
MBI's facilities or processes used to manufacture ALBUNEX) concerning the
development and manufacturing of ALBUNEX, name Mallinckrodt as an alternative
manufacturing site in any and all appropriate submissions or applications, and
update such package whenever any changes occur;

<PAGE>

         (e) During Phases 1 and 2, provide with each shipment of ALBUNEX a
quality certification substantially in the form of APPENDIX 6 certifying,
among other things, the purity and quality of materials, compliance of ALBUNEX
with the Product Specifications and compliance of the manufacturing process
with current Good Manufacturing Practices. MBI shall also certify that all (i)
vials included in the shipment during Phase 1 will have a remaining
shelf-life, from the date of receipt by Mallinckrodt at the designated site
for delivery (I.E., Mallinckrodt's designated warehouse or such other location
as Mallinckrodt shall designate), at least equal to two-thirds of the
shelf-life allowed by the FDA (or Foreign Equivalent Authorities) before the
product is considered out-of-date and (ii) flex bags of each Albunex Product
included in the shipment during Phase 2 will have a remaining shelf-life, from
the date of receipt by Mallinckrodt at the designated site for delivery (I.E.,
Mallinckrodt's designated warehouse or such other location as Mallinckrodt
shall designate), that allows Mallinckrodt sufficient time to complete the
manufacturing process on the product in the flex bags;

         (f) Promptly forward to Mallinckrodt all inquiries and complaints it
receives from any person or entity for ALBUNEX and provide Mallinckrodt with
any reasonable assistance requested by Mallinckrodt in connection with
complaints, quality issues or product recalls. Mallinckrodt and MBI shall
establish procedures to provide MBI with the opportunity to obtain direct
clinical responses from Mallinckrodt's customers, in the presence of
Mallinckrodt representatives, regarding their satisfaction with ALBUNEX,
understanding of and training in its use, perception of its clinical utility,
and utilization rates. Mallinckrodt shall provide these opportunities to MBI
at a minimum of four times per year through (among other possible means, and
where considered appropriate by Mallinckrodt) attendance at meetings of
Mallinckrodt's medical advisory boards, presence at Mallinckrodt focus groups
and work in the field with Mallinckrodt sales or marketing representatives.
MBI shall not contact Mallinckrodt's ALBUNEX customers for any reason
whatsoever without the prior written consent of Mallinckrodt, except with
respect to (i) products or services not contemplated by this Agreement, (ii)
MBI's contacts with clinicians, experts and institutions in connection with
MBI's preclinical and clinical activities and (iii) MBI's market research
studies authorized under and subject to the limitations of this SECTION
2.04(f). In order to avoid potential confusion among customers about
Mallinckrodt's exclusive distributorship, MBI shall not be an exhibitor of
ALBUNEX at medical trade shows (for example, meetings of the American College
of Cardiology, American Heart Association, American Institute of Ultrasound
and Medicine, American Society of Echocardiography, and Radiological Society
of North America) or regional hospital/physician-sponsored meetings. MBI may
be an exhibitor of non-ALBUNEX products at these meetings (and its exhibit may
indicate that MBI is the developer of ALBUNEX and manufacturer of ALBUNEX for
Mallinckrodt to the extent MBI still manufactures for Mallinckrodt), and in
any case, MBI may attend these meetings and present papers. In addition, MBI
shall not conduct any advertising or promotional activities for ALBUNEX to
Mallinckrodt customers. Mallinckrodt is responsible for market research for
ALBUNEX, but MBI may undertake limited market research studies for the sole
purpose of identifying desirable additional indications of ALBUNEX for
clinical development. MBI may conduct such studies subject to the conditions
that (i) MBI provides Mallinckrodt with copies of all interim and final
reports and (ii) MBI does not single out known Mallinckrodt customers in
conducting such studies;

         (g) Undertake to keep Mallinckrodt regularly and promptly informed of
any and all significant medical, technical, legal, commercial or other matters
of which it shall gain knowledge in connection with the manufacture or use of
ALBUNEX or in connection with the sale of ALBUNEX in the Territory, the
Additional Territory and the Nycomed Territory. MBI shall meet with
Mallinckrodt periodically, but not less frequently than quarterly, to discuss
such matters as well as any other matters related to ALBUNEX or MBI as
reasonably requested by Mallinckrodt;

         (h) Provide Mallinckrodt (i) copies of all correspondence, reports
and other written documents received by or provided by MBI under the Feinstein
License, as amended, and (ii) prompt notice of any claim, controversy or
dispute arising under or related to such License. MBI shall provide
Mallinckrodt a copy of any proposed amendment or modification to the Feinstein
License not less than 30 days prior to its disclosure to or oral discussion
with Steven B. Feinstein, M.D., his attorneys or representatives. In the event
that Mallinckrodt notifies MBI within 10 working days after receipt of such
copy from MBI that Mallinckrodt, in its reasonable judgment, determines that
the proposed amendment or modification is detrimental to Mallinckrodt, then
MBI shall not amend or modify the Feinstein License without the prior written
consent of Mallinckrodt which consent shall not be unreasonably withheld. MBI
shall take all action necessary to preserve and maintain its rights and
license under the Feinstein License;
<PAGE>

         (i) Except after prior consultation with and the prior written consent
of Mallinckrodt, which consent shall not be unreasonably withheld, not (a) take
official or formal steps or make any public announcement to stop or suspend the
sale and distribution of ALBUNEX, or (b) cancel or cause to be cancelled any
necessary government authorizations regarding the use and distribution of
ALBUNEX, in the Territory, the Additional Territory and the Nycomed Territory;

         (j) Cause members of key management of MBI to devote all necessary time
and effort to the performance of MBI's obligations under this Agreement; and

         (k) Assist Mallinckrodt, upon its reasonable request, in complying with
applicable laws and government regulations affecting the manufacturing, sale,
use and distribution of ALBUNEX and which are not otherwise the responsibility
of MBI as provided herein, provided that Mallinckrodt shall reimburse MBI for
any fees paid to any governmental agency by MBI pursuant to a request under this
SECTION 2.04(k).

         2.05 DUTIES OF MALLINCKRODT.  Mallinckrodt shall:

         (a) Comply with applicable laws and governmental regulations affecting
the sale and distribution of ALBUNEX, with the assistance of MBI, if so
requested by Mallinckrodt;

         (b) During Phases 1 and 2, no later than the first business day of each
calendar quarter, prepare a written four-quarter forecast by month (a
"FORECAST") of Mallinckrodt's purchases of ALBUNEX during that calendar quarter
and the next three calendar quarters. Each Forecast shall specify the quantities
of each Albunex Product during Phase 1 and the quantities of flex bags of
OPTISON during Phase 2 that Mallinckrodt estimates it will purchase each quarter
of the Forecast, by month, and the Forecast for the first two calendar quarters
of each Forecast shall be a firm order for those quarters, for delivery by MBI
during those quarters in accordance with SECTION 2.04(c). In addition, no later
than the first business day of the second and third months of each calendar
quarter, Mallinckrodt shall prepare a written update of its forecast of
purchases of ALBUNEX for the next 12 months. All Forecasts and updates shall be
made in good faith and with due regard to known demand, market conditions and
competitive factors;

         (c) Except as permitted by SECTIONS 2.03 AND 7.01(a), neither
manufacture ALBUNEX nor purchase ALBUNEX from anyone other than MBI; provided
MBI can supply such ALBUNEX as Mallinckrodt may need; and

         (d) Promptly forward to MBI reasonably detailed notice of all
complaints that Mallinckrodt receives from its customers for ALBUNEX.

         2.06 SHIPMENT.

         (a) During Phases 1 and 2, MBI shall ship ALBUNEX in a commercially
reasonable manner to Mallinckrodt sites, warehouses and freight forwarders in
the United States of America and the possessions of the United States of America
within the Territory, and, if commercially reasonable, on an isolated basis
directly to Mallinckrodt customers, all as Mallinckrodt may from time to time
designate. Costs of freight shall be treated in the same way as other MBI
Manufacturing Expenses under SECTION 2.03(b).

         (b) During Phases 1 and 2, MBI shall not transport or ship any ALBUNEX
until (i) MBI and Mallinckrodt shall have each obtained all applicable
approvals, authorizations, and licenses of any required governmental agency or
instrumentality for shipment (including, without limitation, any export or
import licenses or approvals), and (ii) MBI and Mallinckrodt have complied with
all applicable laws and regulations regarding the export, import, shipment, and
labeling of ALBUNEX. Each party shall provide reasonable assistance to the other
party in obtaining the necessary approvals, authorizations and licenses.

<PAGE>

         2.07 F.O.B. During Phases 1 and 2, all shipments of ALBUNEX to
Mallinckrodt shall be F.O.B. destination.

         2.08 REJECTION. During Phases 1 and 2, if any shipment of ALBUNEX
manufactured by MBI is found by Mallinckrodt within a reasonable time after
delivery to be defective in material or workmanship or otherwise not in
conformity with the Product Specifications or other requirements hereof,
Mallinckrodt in addition to any other rights which it may have under any
warranties in this Agreement or otherwise, may reject and return such ALBUNEX at
MBI's expense, which goods shall not be replaced without Mallinckrodt's prior
written authorization. Mallinckrodt shall receive a credit against the payment
of MBI Manufacturing Expenses in an amount equal to the cost to Mallinckrodt to
produce the defective goods. Payment of MBI Manufacturing Expenses for the
ALBUNEX shall not constitute acceptance of the products. ALBUNEX rejected by
Mallinckrodt which utilizes any Mallinckrodt name, trade name, trademark,
insignia, symbol, decorative design or evidence of Mallinckrodt's purchase or
inspection shall have the same removed prior to any disposition by MBI. MBI
shall indemnify Mallinckrodt from any claim, loss or damage arising out of any
failure of MBI so to do.

         2.09 MALLINCKRODT TRADEMARKS.

         (a) MBI shall not have any right, title or interest in or to, and shall
not in any respect use, the Mallinckrodt name or logo.

         (b) Mallinckrodt shall have the right to market and sell ALBUNEX (i)
provided by MBI during Phases 1 and 2 , and (ii) manufactured by Mallinckrodt
during Phase 3, under any trademark which Mallinckrodt, in its discretion after
consultation with MBI, deems appropriate.

         (c) During Phase 1, the packaging for ALBUNEX provided by MBI to
Mallinckrodt pursuant to this ARTICLE 2 shall be consistent with the packaging
provided by MBI as of the Effective Date and shall include all product inserts.
Mallinckrodt shall be responsible for all costs of additional packaging or
re-packaging, if any, for shipment to customers.

         (d) All final packaging, including product inserts and labels, shall
make appropriate reference to MBI including when Mallinckrodt manufactures
ALBUNEX.

         2.10 PRODUCT LITERATURE. MBI shall provide to Mallinckrodt technical,
performance and testing information, and any other such information as may
reasonably be requested by Mallinckrodt to assist in the production of sales
material, product inserts, packaging, user instructions or other similar items
for ALBUNEX. Mallinckrodt shall provide MBI with representative samples of
product promotional and sales literature prior to release.

         2.11 INSURANCE.

         (a) Prior to the Launch Date, MBI shall take out and maintain
comprehensive general liability insurance, including products liability
insurance, with minimum limits of $5,000,000 combined for bodily injury and
property damage liabilities. Such insurance shall have both foreign and domestic
coverage with the coverage applying worldwide regardless of where a claim is
filed, except for the countries/territories of Cuba, Vietnam, Campuchea, Laos,
North Korea and Outer Mongolia. MBI shall have the option to self-insure its
obligations under this Agreement so long as MBI's net worth, as determined in
accordance with generally acceptable accounting principles consistently applied,
exceeds $50,000,000. MBI shall furnish a certificate of insurance or of
self-insurance to Mallinckrodt evidencing the foregoing coverage and required
limits of liability prior to the Launch Date. During Phases 1 and 2, in the
event that any raw materials inventory, work-in-process inventory or finished
goods inventory is destroyed prior to shipment from MBI's facilities,
Mallinckrodt shall be entitled to (i) the replacement of such destroyed
inventory or (ii) reimbursement of the MBI Manufacturing Expenses paid by
Mallinckrodt that are related to such destroyed inventory from any insurance
proceeds received by MBI.

<PAGE>

         (b) Prior to the Launch Date, Mallinckrodt shall maintain comprehensive
general liability insurance, including products liability insurance, with
minimum limits of $5,000,000 combined for bodily injury and property damage
liabilities. Such insurance shall have both foreign and domestic coverage with
the coverage applying worldwide regardless of where a claim is filed, except for
the countries/territories of Cuba, Vietnam, Campuchea, Laos, North Korea and
Outer Mongolia. Mallinckrodt shall have the option to self-insure its
obligations under this Agreement. Mallinckrodt shall furnish a certificate of
insurance or of self-insurance to MBI evidencing the foregoing coverage and
required limits of liability prior to the Launch Date.

         2.12 INSPECTION AND PAYMENT FOR SAMPLES AND RESEARCH AND TRIAL
QUANTITIES.

         (a) During Phases 1 and 2, Mallinckrodt shall have the right during
normal business hours to inspect (i) upon not less than 10 business days prior
notice, MBI's business and financial records relating to the manufacture, use or
sale of ALBUNEX in the Territory, the Additional Territory and the Nycomed
Territory or any other obligation of MBI under this Agreement, and (ii) upon not
less than 2 business days prior notice, MBI's facilities and operations, and any
other scientific data and information relating to ALBUNEX, or the manufacture,
use or sale of ALBUNEX in the Territory, the Additional Territory and the
Nycomed Territory, in order to insure that ALBUNEX is being manufactured in
compliance with current Good Manufacturing Practices and that the other terms
and conditions of this Agreement are being met, provided, however, Mallinckrodt
shall have the right to conduct such inspection without prior notice to MBI no
more frequently than once per calendar quarter. Mallinckrodt's right of
inspection shall not extend to MBI's business and financial records relating to
the Nycomed Agreement.

         (b) During Phases 1 and 2, Mallinckrodt may, but shall not be obligated
to, sample any shipment of ALBUNEX to verify the accuracy of MBI's certificate
described in SECTION 2.04(e). During Phases 1, 2 and 3, in connection with the
marketing and promotion of ALBUNEX, Mallinckrodt may, but shall not be obligated
to, provide samples of ALBUNEX to customers or potential customers free of
charge.

         (c) Mallinckrodt shall be obligated to pay MBI for any sample of
ALBUNEX used for the purposes described in SECTION 2.12(b) on the same basis as
any other ALBUNEX sold to Mallinckrodt under this Agreement.

         (d) Mallinckrodt may provide MBI with ALBUNEX during Phase 3 as
approved by and on such terms as the Joint Steering Committee shall determine.

         2.13 ANALYSIS, QUALITY CONTROL, TESTING AND RELEASE. During Phase 1,
MBI shall perform the final quality control testing, further processing,
labeling of final containers, and final release on ALBUNEX. During Phase 2, MBI
shall perform the final quality control testing, further processing, and
labeling of flex bags of ALBUNEX. During Phase 2, Mallinckrodt shall perform
labeling of final containers and final release on ALBUNEX. During Phase 3,
Mallinckrodt shall perform the final quality control testing, further
processing, labeling of final containers, and final release on ALBUNEX.

         2.14 REPORTS; PRICE/ROYALTY; AUDIT RIGHTS; FOREIGN CURRENCY; INTEREST
ON LATE PAYMENTS.

         (a) Mallinckrodt shall deliver to MBI, within 45 days after the start
of each calendar quarter, a true and accurate report of the Average Selling
Price of each Albunex Product sold during the preceding calendar quarter. This
report shall include all relevant details, including gross sales, all
adjustments used to derive Net Sales and number of vials shipped to purchasers.
In addition, Mallinckrodt shall provide MBI with monthly sales reports no later
than 30 days after the end of each month. Each monthly sales report shall
include, by Albunex Product, (i) the total number of vials sold by package
configuration, and (ii) the amount of all Net Sales by month.

         (b) With respect to any calendar quarter, Mallinckrodt shall pay to MBI
a royalty equal to the amount determined by multiplying the number of vials of
each MBI Licensed Product sold by Mallinckrodt by of the Average Selling Price
for such MBI Licensed Product during the calendar quarter in which the Product
was sold. Mallinckrodt's royalty obligation under this SECTION 2.14(b) shall
apply only to those MBI Licensed Products

<PAGE>

manufactured by MBI or Mallinckrodt under the terms of this Agreement (ARDA II),
and shall continue through the expiration date of the last patent relating to
ALBUNEX, on a country-by-country basis. Royalty payments shall be made in United
States dollars and shall be due no later than 45 days following the end of the
calendar quarter in which the sale was made. In the event that Mallinckrodt does
not receive distributor sales data within 45 days of the end of the quarter,
then Mallinckrodt will pay an estimated royalty based on its historical
experience and will include an adjustment in the following quarterly payment to
true-up such estimate.

         (c) Mallinckrodt shall keep full, true and accurate books of account
containing all particulars which may be necessary for the purpose of determining
the amount to be paid under this Agreement. Mallinckrodt agrees, at the request
of MBI and at MBI's expense, to permit an independent certified accountant
selected by MBI and reasonably acceptable to Mallinckrodt, access upon at least
10 business days prior notice and no more than once a calendar quarter to such
books of account for the purpose of verifying the reports described in SECTIONS
2.03(a) AND 2.14(a). Such accountant shall not be entitled to disclose any
information relating to the business of Mallinckrodt except that which should be
properly contained in any statement required in SECTIONS 2.03(a) AND 2.14(a).

         (d) Mallinckrodt shall inform MBI of Mallinckrodt's proposed initial
pricing of each new Albunex Product. If the proposed initial price of any new
Albunex Product is less than , or if the Average Selling Price of any existing
Albunex Product is less than for two consecutive calendar quarters, Mallinckrodt
may (i) if the Albunex Product in question is a new product, cancel or postpone
launch of the commercial sale of that product, and (ii) if the Albunex Product
in question is an existing product, cancel or suspend the commercial sale of
that Albunex Product (in either case without being in breach or default under
this Agreement or losing exclusivity as a result).

         (e) If any payment due under this Agreement is not paid in full when
due, interest shall accrue on the unpaid amount from the date due until paid at
a fluctuating rate equal at all times to the rate 2.0% above the rate the First
National Bank of Chicago/BankOne publishes or announces as its prime or
equivalent rate of interest.

         (f) Only one royalty shall be payable hereunder as to any particular
MBI Licensed Product sold by Mallinckrodt or its Affiliates.

         2.15 FUNDING OF FURTHER ALBUNEX DEVELOPMENT.

         (a) Mallinckrodt shall pay MBI $20 million for the further development
of ALBUNEX, as follows:

                  (1) $1 million on the first day of each of the four quarters
         (each of three calendar months), beginning with the quarter starting on
         the first day of the first calendar month beginning after the effective
         date of ARDA;

                  (2) $1.25 million on the first day of each of the next eight
         quarters, beginning with the quarter starting on the first anniversary
         of the first day of the first calendar month beginning after the
         effective date of ARDA; and

                  (3) $1.5 million on the first day of each of the next four
         quarters, beginning with the quarter starting on the third anniversary
         of the first day of the first calendar month beginning after the
         effective date of ARDA.

Consistent with the guiding principles described in SECTION 2.16(b), the Joint
Steering Committee, by a unanimous vote of its members and written notice to
Mallinckrodt, may direct the acceleration of these payments at any time by
increasing the amount of the next payment or payments that Mallinckrodt is
required to make and reducing the last payment that Mallinckrodt is otherwise
required to make by the same amount as the aggregate increase (and if the
aggregate increase exceeds the amount of the last payment that Mallinckrodt is
required to make, reducing the amount of each prior payment in turn, beginning
with the next-to-last payment that Mallinckrodt is required to make and
proceeding in reverse chronological order, until the aggregate reductions equal
the aggregate increase). Payment shall be made by wire transfer to an account
designated by MBI. Mallinckrodt representatives on the Joint

<PAGE>

Steering Committee shall not be required to (but may) vote in favor of any
acceleration proposed by the MBI representatives on the Committee.

         (b) Mallinckrodt shall fund the clinical trials and research to be
performed pursuant to SECTION 2.01, subject to the review and approval of the
Joint Steering Committee. Mallinckrodt shall not provide any additional funds to
MBI over and above the $20 million previously paid pursuant to SECTION 2.15(a)
until MBI has included the new funds in a budget and such budgets have been
approved by the Joint Steering Committee.

         (c) MBI shall keep true and accurate records of its expenditures
described in SECTIONS 2.01, 2.03 AND 2.15(a) AND (b). Mallinckrodt shall have a
right of audit regarding these expenditures similar in frequency and scope to
the right of audit afforded MBI by SECTION 2.14(c).

         (d) MBI acknowledges that Mallinckrodt has previously made all of the
payments that Mallinckrodt was required to make under SECTION 2.15(a).
Mallinckrodt acknowledges that MBI has: (i) exhausted all amounts previously
paid by Mallinckrodt under SECTION 2.15(a) and (ii) properly accounted for the
expenditure of the amounts paid under SECTION 2.15(a) to Mallinckrodt's
satisfaction.

         2.16 JOINT STEERING COMMITTEE. MBI and Mallinckrodt shall establish a
joint steering committee (the "JOINT STEERING COMMITTEE"), which shall have
three functions:

                  (1) to review, on a quarterly basis (or more frequently as
         requested by either party), clinical trial programs relating to the
         development and regulatory approval of ALBUNEX, with a particular
         emphasis on reviewing the budgeting, design, implementation and
         expenditures related to clinical trials and any Investigational Device
         Exemption or Investigational New Drug applications to the FDA
         (including related amendments and other ancillary filings) and
         corresponding filings with Foreign Equivalent Authorities ("CLINICAL
         REVIEW");

                  (2) to review, on a quarterly basis (or more frequently as
         requested by either party), the development and implementation of
         marketing plans, strategies and budgets in the Territory, the
         Additional Territory and the Nycomed Territory ("MARKETING REVIEW");
         and

                  (3) during Phases 1 and 2 only, to review, on a quarterly
         basis (or more frequently as requested by either party), the operation,
         development and implementation of Mallinckrodt's Manufacturing
         Operations and to review budgets and expenditures related to MBI
         Manufacturing Expenses ("MANUFACTURING REVIEW").

         In respect of Clinical Review, the Committee is intended to provide a
mechanism to enable the parties to share their expertise and concerns relating
to clinical programs, regulatory affairs and cost-effectiveness and
reimbursement issues, and shall have significant authority and flexibility in
determining the staffing, task assignments, objectives, number, design and other
features of clinical trials, with a view to maximizing the return on development
costs and expediting commercialization. In respect of Marketing Review, the
Committee is intended to provide a mechanism to enable the parties, consistent
with the other provisions of this Agreement, to gather and share marketing and
other information that will enable them to plan and implement marketing
strategies designed to accomplish their mutual goals of (i) obtaining market
leadership and maximizing distribution of ALBUNEX in the Territory, the
Additional Territory and the Nycomed Territory, and in particular countries
within each territory, and (ii) obtaining a superior return on their respective
investments while balancing the expenses of marketing, advertising, selling and
distribution against expected increases in sales and profits. In this regard,
the parties recognize that market conditions in each territory, and in
particular

<PAGE>

countries within each territory, are constantly changing, and that Marketing
Review is intended to be a dynamic and continuing process. In respect of
Manufacturing Review, the Committee is intended to provide a mechanism to
monitor the progress and address any needs that may arise during the Technology
Transfer Period and to ensure the cost effectiveness of MBI Manufacturing
Expenses during Phases 1 and 2.

         The Committee shall consist of whatever number of MBI representatives
and Mallinckrodt representatives are required to properly execute the duties of
the Committee. Regardless of the number of members of the Committee, MBI and
Mallinckrodt shall each have three votes on all matters, Four votes are
sufficient to approve any action of the Committee. The parties shall give prompt
written notice to one another of any changes in their respective representatives
on the Committee, and representatives may designate an alternate representative
to act in their capacity during their absence.

         The Committee has formerly adopted procedures to govern its activities
substantially in the form described in APPENDIX 7. At the earliest possible
date, the Committee shall prepare a charter to formalize and govern the duties,
responsibilities and activities of the Committee and its members (the
"CHARTER"). Until such time as the Charter is adopted, the procedures in
APPENDIX 7 shall govern the Committee's activities. The Charter will be based on
the procedures currently included in APPENDIX 7, but will be a living document
separate and apart from this Agreement and consistent with its principles, and
such Charter may be amended or modified from time to time at the Committee's
discretion.

         (a) The Joint Steering Committee shall have the broad authority to
specify the clinical trials and other activities required to be performed under
SECTION 2.01(c), and MBI shall not make any expenditure under that Section
without the Committee's prior authorization. In connection with the quarterly
review process performed pursuant to SECTION 2.16(1), wherein the Joint Steering
Committee reviews and assesses the progress of the clinical trials, the
Committee shall have the right to amend or modify previously approved budgets or
to completely withdraw funding for any clinical trials, if it appears to the
Committee that such clinical trials are likely to result in an unfavorable
outcome.

         (b) The Joint Steering Committee's decisions shall be guided by the
following principles, emphasizing both quality and speed:

                  (1) it is very important to bring a product to market in the
         shortest possible time consistent with the prevailing regulatory
         climate (but the quality of the clinical program, including clinical
         utility and cost-effectiveness, is equally important);

                  (2) it is important that clinical studies are conducted and
         their results presented in a thorough, well-organized and professional
         manner;

                  (3) the Committee's decisions should be made with a sense of
         urgency consistent with the prevailing regulatory climate, applying the
         standard of a prudent businessman who has a lead over his competitors
         and wants to maintain that lead, and with a view towards operating by
         consensus and in a manner intended to emphasize partnership and a
         commonality of interests; and

                  (4) it is important to achieve the broadest possible market
         penetration in each significant market at the earliest possible date,
         consistent with a responsibly conducted product launch. However, the
         cost of market penetration must be balanced against potential near term
         and long term sales and revenues.

         (c) In the event of a dispute over a matter for which the parties have
an equal number of votes, MBI and Mallinckrodt shall attempt to resolve the
dispute informally in light of the guiding principles in SECTION 2.16(b). If MBI
and Mallinckrodt are unable to resolve the dispute, they shall each designate as
a referee an unaffiliated person with senior-level credentials in the medical,
scientific, clinical and administrative areas relevant to the Committee's
activities, and the two referees shall attempt to resolve the dispute. If they
are unable to do so within a

<PAGE>

reasonable period, they shall jointly appoint a third person with similar
qualifications to act as an arbitrator. In reaching a decision, the arbitrator
shall take into account such matters as he considers appropriate, and may
require the parties to provide a written statement or oral presentation in
support of their respective positions. The arbitrator's decision shall be
binding on MBI and Mallinckrodt. During the pendency of the dispute,
Mallinckrodt shall not withhold (and neither the referees nor any arbitrator
appointed by them shall have authority to excuse or delay) any payments due from
Mallinckrodt to MBI under this Agreement. MBI and Mallinckrodt shall each pay
the fees and expenses of its own referee and one-half of the fees and expenses
of any arbitrator that the two referees appoint.

         (d) In the event of a dispute over a matter relating to Marketing
Review that cannot be resolved by the Committee, MBI and Mallinckrodt shall
attempt to resolve the dispute informally in light of the guiding principles in
SECTION 2.16(b).

         (e) The authority of the Joint Steering Committee in respect of
Clinical Review shall continue indefinitely but shall cease upon 30 days' prior
written notice from Mallinckrodt or MBI to the other given at any time after the
latest of: (i) the date that ALBUNEX is approved for sale in both the United
States and in the European Union for an intravenous myocardial perfusion
indication; (ii) the date that ALBUNEX is approved for sale in the United States
and in the European Union for a radiology indication or (iii) the date that
Mallinckrodt ceases to be the exclusive distributor, sales representative and
licensee for ALBUNEX sold in and throughout any territory (except for
sub-distributors appointed by Mallinckrodt or an Affiliate of Mallinckrodt). The
authority of the Joint Steering Committee in respect of Marketing Review shall
continue indefinitely but shall cease in respect of Marketing Review for any
territory on the date that Mallinckrodt ceases to be the exclusive distributor
and sales representative for ALBUNEX sold in and throughout that territory
(except for sub-distributors appointed by Mallinckrodt or an Affiliate of
Mallinckrodt). The authority of the Joint Steering Committee in respect of
Manufacturing Review shall cease, on a territory by territory basis, at the time
the manufacturing for such territory enters Phase 3.

         2.17 ADDITIONAL PAYMENTS. Mallinckrodt shall make the following
payments to MBI:

         (a) $3 million on the date when the Nycomed Territory Amendment becomes
effective, and MBI acknowledges that Mallinckrodt has previously made this
payment; and

         (b) $4 million upon the first commercial sale of ALBUNEX in Germany by
Mallinckrodt or an Affiliate of Mallinckrodt for an approved intravenous
myocardial perfusion indication, and in this regard, Mallinckrodt shall take all
necessary and appropriate steps to achieve approval at the earliest possible
date for the sale in Germany of ALBUNEX for such an indication; provided,
however, that Mallinckrodt retains the right, based on commercially reasonable
factors, to determine, in a commercially reasonable manner, the appropriate
launch date for ALBUNEX in Germany.

                                    ARTICLE 3

                               DISTRIBUTION RIGHTS

         3.01 APPOINTMENT AS DISTRIBUTOR AND SALES REPRESENTATIVE. MBI hereby
appoints Mallinckrodt, and Mallinckrodt hereby accepts appointment as the
exclusive distributor and exclusive sales representative for ALBUNEX to be sold
in and throughout the Territory, the Additional Territory and the Nycomed
Territory. Subject to SECTION 14.03, the appointment pursuant to this SECTION
3.01 is non-cancelable during the term of this Agreement.

         3.02 NYCOMED TERRITORY AMENDMENT.

         3.02A IDENTIFICATION. This Section constitutes the "Nycomed Territory
Amendment" as that term is defined in SECTION 1.40. As of the November 4, 1996,
Mallinckrodt's appointment in SECTION 3.01 as the exclusive distributor and
exclusive sales representative for ALBUNEX to be sold in and throughout the
Nycomed Territory,

<PAGE>

and all of the other provisions relating to the parties' respective rights and
duties in the Nycomed Territory, were effective.

         3.02B UPFRONT PAYMENT. Pursuant to SECTION 3.1 of the Nycomed License
Amendment, MBI paid $700,000 to Nycomed upon the parties' execution of the
Nycomed License Amendment, and pursuant to SECTION 3.2 of the Nycomed License
Amendment, MBI paid an additional $2 million to Nycomed on or about March 31,
1996. On December 17, 1996, Mallinckrodt paid $2.7 million to MBI by wire
transfer.

         3.02C MILESTONE PAYMENTS. SECTIONS 3.02C(a) AND (b) provide that
Mallinckrodt shall pay to MBI "$3 million on the date when the Nycomed Territory
Amendment [I.E., this Amendment] becomes effective" and "$4 million upon the
first commercial sale of ALBUNEX in Germany by Mallinckrodt ... for an approved
intravenous myocardial perfusion indication ...." SECTION 3.3 of the Nycomed
License Amendment provides that MBI shall pay to Nycomed "45 % of any amounts in
excess of $2,700,000 received by MBI in either up-front, milestone or similar
payments from third parties" in consideration for MBI's grant of ALBUNEX rights
in the Nycomed Territory. The payments that Mallinckrodt is required to make
pursuant to SECTIONS 3.02C(a) AND (b) will constitute "amounts in excess of
$2,700,000" for purposes of SECTION 3.3 of the Nycomed License Amendment.
Accordingly:

                  (a) on December 17, 1996, Mallinckrodt shall pay $3 million to
         MBI by wire transfer, pursuant to SECTION 2.17(a);

                  (b) on or before January 16, 1997, Mallinckrodt shall pay
         $1.35 million (or 45% of $3 million) to Nycomed in satisfaction of
         Nycomed's claims under SECTION 3.3 of the Nycomed License Amendment in
         respect of Mallinckrodt's payment of $3 million to MBI pursuant to
         SECTION 2.17(a);

                  (c) within five days after the date of the first commercial
         sale of ALBUNEX in Germany by Mallinckrodt or an Affiliate of
         Mallinckrodt which is specifically approved for an intravenous
         myocardial perfusion indication, Mallinckrodt shall pay $4 million to
         MBI pursuant to SECTION 2.17(b); and

                  (d) within 30 days after the date of the first commercial sale
         of ALBUNEX in Germany by Mallinckrodt or an Affiliate of Mallinckrodt
         for an approved intravenous myocardial perfusion indication,
         Mallinckrodt shall pay $1.8 million (or 45% of $4 million) to Nycomed
         in satisfaction of Nycomed's claims under SECTION 3.3 of the Nycomed
         License Amendment in respect of Mallinckrodt's payment of $4 million to
         MBI pursuant to SECTION 2.17(b); provided, however, that Mallinckrodt
         retains the right, based on commercially reasonable factors, to
         determine the appropriate launch date for ALBUNEX in Germany.

MBI acknowledges that Mallinckrodt has previously made the payments that
Mallinckrodt was required to make under SECTIONS 3.02C(a) AND (b).

         3.02D ROYALTIES TO NYCOMED. SECTION 3.5 of the Nycomed License
Amendment provides that, for the remaining term of the Nycomed License
Amendment, MBI shall pay Nycomed a royalty of 2.5% on the first $30 million of
the Net Selling Price of Licensed Products sold in the Nycomed Territory each
year and 3.5% on the Net Selling Price of Licensed Products on sales in excess
of $30 million each year (as "Net Selling Price" is defined in SECTION 3.5.1 of
the Nycomed License Amendment and "Licensed Product" is defined in SECTION I.B
of the Nycomed Agreement). SECTION 3.5 of the Nycomed License Amendment also
provides that "[a] separate royalty shall be payable in respect of each Licensed
Product." For purposes of this Amendment, the following products shall be
considered separate Licensed Products ("SEPARATE PRODUCTS"): (i) Infoson; (ii)
the First Generation Product and any substantially similar formulation; (iii) FS
and any substantially similar formulation; and (iv) any other formulation of
ALBUNEX which is not substantially similar to Infoson, the First Generation
Product or FS. Mallinckrodt shall pay to MBI, for payment to Nycomed, the
following royalty on Net Sales of ALBUNEX in the Nycomed Territory:

                  (a) a royalty of 1.5% (= 2.5% x 0.60) on the first $30 million
         of Net Sales of each Separate Product each calendar year; and

<PAGE>

                  (b) a royalty of 2.1% (= 3.5% x 0.60) on Net Sales of each
         Separate Product each calendar year in excess of $30 million.

Royalties payable under this SECTION 3.02D shall be paid pursuant to the
procedures in SECTION 2.14.

         3.02E    SHIPMENT. During Phase 1, MBI shall ship ALBUNEX for sale
in the Nycomed Territory in a commercially reasonable manner from MBI's
warehouse to any one site in the Nycomed Territory designated by
Mallinckrodt. Costs of shipping and labeling shall be treated in the same way
as other MBI Manufacturing Expenses under SECTION 2.03(b). Title to the
product shipped shall pass to Mallinckrodt upon shipment from MBI's
warehouse, however, Mallinckrodt retains the right to reject any shipment
after receipt that does not conform to Product Specifications.

         3.02F    SURVIVAL OF ROYALTY AND OTHER OBLIGATIONS.

         (a) If MBI exercises its rights under SECTIONS 9.01(a) OR (b):

                  (l) Mallinckrodt's royalty obligation to MBI pursuant to
         SECTION 3.02D shall be considered modified to provide for a payment to
         MBI, in respect of each Separate Product, of a percentage of the
         royalty due to Nycomed under Section 3.5 of the Nycomed License
         Amendment in respect of that Separate Product. This percentage shall be
         equal to the product of (i) the quotient obtained by dividing
         Mallinckrodt's Net Sales of the Separate Product by the Aggregate Net
         Sales of the Separate Product multiplied by (ii) 100. The parties shall
         report their respective portions of the Aggregate Net Sales of each
         Separate Product to one another for purposes of calculating the
         applicable percentage under this SECTION 3.02F(a)(1).

                  (2) Mallinckrodt's royalty obligation to MBI pursuant to
         SECTION 4.03(c), shall survive and continue, for as long as a royalty
         remains payable by MBI under Section 5.2 of the Feinstein License,
         except that Mallinckrodt's payments to MBI shall be the entire amount
         of the royalty due to Dr. Feinstein under SECTION 5.2(b) of the
         Feinstein License in respect of Licensed Products (as "Licensed
         Products" defined in SECTION 1.2 of the Feinstein License) manufactured
         and sold by Mallinckrodt in the Nycomed Territory.

         (b) If this Agreement terminates following notice from Mallinckrodt
pursuant to SECTIONS 14.02(b), (c), OR (e), then in addition to the other
effects described in SECTION 14.03:

                  (1) Mallinckrodt's royalty obligation to MBI pursuant to
         SECTION 3.02D shall survive and continue, for as long as a royalty
         remains payable by MBI under Section 3.5 of the Nycomed License
         Amendment, except that until the latest of (i) or (ii) termination of
         this Agreement, the royalty payable by Mallinckrodt on Net Sales of
         ALBUNEX in the Nycomed Territory shall be:

                           (a) 1.5% on the first $30 million of Net Sales of
                  each Separate Product for each calendar year; and

                           (b) 2.1% on Net Sales of each Separate Product for
                  each calendar year in excess of $30 million.

         After such date, Mallinckrodt shall pay MBI a percentage of the royalty
         due to Nycomed under Section 3.5 of the Nycomed License Amendment in
         respect of each Separate Product. For each Separate Product, this
         percentage shall be equal to the product of (i) the quotient obtained
         by dividing Mallinckrodt's Net Sales of the Separate Product by the
         Aggregate Net Sales of the Separate Product multiplied by (ii) 100. The
         parties shall report their respective portions of the Aggregate Net
         Sales of each Separate Product to one another for purposes of
         calculating the applicable percentage under this Section.

<PAGE>

                  (2) Mallinckrodt's royalty obligation to MBI pursuant to
         SECTION 4.03(c), shall survive and continue, for as long as a royalty
         remains payable by MBI under Section 5.2 of the Feinstein License,
         except that Mallinckrodt's payments to MBI shall be the entire amount
         of the royalty due to Dr. Feinstein under 5.2(b) of the Feinstein
         License in respect of Licensed Products (as "Licensed Products" defined
         in Section 1.2 of the Feinstein License) manufactured and sold by
         Mallinckrodt in the Nycomed Territory.

         (c) If this Agreement terminates following notice from MBI pursuant to
Sections 14.02(b), (d), OR (f), then in addition to the other effects described
in SECTION 14.03:

                  (1) Mallinckrodt's royalty obligation to MBI pursuant to
         SECTION 3.02D shall survive and continue, for as long as a royalty
         remains payable by MBI under Section 3.5 of the Nycomed License
         Amendment, except that Mallinckrodt's payments to MBI shall be a
         percentage of the royalty due to Nycomed under Section 3.5 of the
         Nycomed License Amendment in respect of each Separate Product. For each
         Separate Product, this percentage shall be equal to the product of (i)
         the quotient obtained by dividing Mallinckrodt's Net Sales of the
         Separate Product by the Aggregate Net Sales of the Separate Product
         multiplied by (ii) 100. The parties shall report their respective
         portions of the Aggregate Net Sales of each Separate Product to one
         another for purposes of calculating the applicable percentage under
         this Section.

                  (2) Mallinckrodt's royalty obligation to MBI pursuant to
         SECTION 4.03(c) shall survive and continue, for as long as a royalty
         remains payable by MBI under Section 5.2 of the Feinstein License,
         except that Mallinckrodt's payments to MBI shall be the entire amount
         of the royalty due to Dr. Feinstein under 5.2(b) of the Feinstein
         License in respect of Licensed Products (as "Licensed Products" is
         defined in Section 1.2 of the Feinstein License) manufactured and sold
         by Mallinckrodt in the Nycomed Territory.

         3.02G    MAINTENANCE OF NYCOMED LICENSE AMENDMENT. MBI shall take
such actions as are necessary and advisable to maintain the Nycomed License
Amendment in force, including, but not limited to, paying all royalties and
other sums due to Nycomed. MBI shall give Mallinckrodt 10 business days'
prior written notice of any proposed amendment or modification of the Nycomed
License Amendment and shall not enter into any such amendment or modification
that adversely affects Mallinckrodt without Mallinckrodt's prior written
consent.

         3.02H    EXCLUSIVITY IN NYCOMED TERRITORY. (FOR HISTORICAL PURPOSES
ONLY.)

         (a) Beginning on the date that MBI enters into the Nycomed License
Amendment and continuing for a period of one year from the date that MBI gives
Mallinckrodt written notice that MBI has done so, MBI shall not (i) directly, or
through an Affiliate of MBI, sell ALBUNEX for its own account in the Nycomed
Territory or (ii) license any third party to sell or distribute ALBUNEX in the
Nycomed Territory.

         (b) In no event shall Mallinckrodt negotiate with Nycomed for a
sublicense of any kind under the Nycomed Agreement or for an assignment of all
or any part of Nycomed's interest under the Nycomed Agreement.

         3.03     DUTIES OF MBI. In addition to its other duties hereunder,
MBI shall:

         (a) Use reasonable efforts to assist in Mallinckrodt's promotion of
ALBUNEX throughout the Territory, the Additional Territory and the Nycomed
Territory in support of Mallinckrodt's respective marketing plans for those
territories;

         (b) Provide such technical assistance to Mallinckrodt in the marketing,
sale and distribution of ALBUNEX in the Territory, the Additional Territory and
the Nycomed Territory, as Mallinckrodt requests, including the dedication at any
given time of up to a maximum of 10 MBI employees as technical sales
specialists. Each such request shall specify the nature and extent of the
assistance required, and shall be reasonable in respect of the type of
assistance requested and the resources, time and cost required to render that
assistance. MBI shall advise

<PAGE>

Mallinckrodt if MBI considers Mallinckrodt's request unreasonable, and the
parties shall attempt in good faith to resolve their differences.
Notwithstanding anything to the contrary in this Agreement, MBI's expenses under
this Section shall not be reimbursed by Mallinckrodt;

         (c) Provide assistance as reasonably requested by Mallinckrodt with
respect to customer service activities including technical support services and
sales administrative support services; and

         (d) Provide support and assistance in establishing efficient
communications between Mallinckrodt and MBI for shipping information, invoicing,
complaints and customer relations information including support of computer
communications systems for information flow.

         3.04  DUTIES OF MALLINCKRODT. In addition to its other duties
hereunder, Mallinckrodt shall:

         (a)   Treat OPTISON as an important contrast product in the same manner
Mallinckrodt traditionally markets its important contrast line of products for
purposes of Mallinckrodt's premarketing, marketing, sales and distribution
efforts and expenditures. Mallinckrodt's marketing, sales and distribution
efforts regarding OPTISON shall place emphasis on all relevant clinical
indications of OPTISON, market segments and appropriate geographical regions in
the Territory, the Additional Territory and the Nycomed Territory, and the
recruitment of medical and scientific opinion leaders. Notwithstanding the
immediately preceding sentence, MBI and Mallinckrodt acknowledge that
Mallinckrodt has fulfilled this duty to date. In carrying out its future
obligations under this paragraph, Mallinckrodt has the right to balance such
future investments and efforts against historical and potential product
profitability and, in so doing, reach any commercially reasonable judgment it
deems necessary regarding its marketing, sales and distribution efforts and
expenditures relative to OPTISON;

         (b) Subject to the provisions of SECTION 3.04(a), provide an adequate
sales organization and facilities to assure adequate sales representation,
prompt handling of inquiries and orders, and attention to customer service
requirements for OPTISON in support of the activities described in SECTION
3.04(a);

         (c) Comply with applicable laws and governmental regulations affecting
the sale and distribution of OPTISON in the Territory, the Additional Territory
and the Nycomed Territory, with the assistance of MBI, if so requested by
Mallinckrodt;

         (d) Provide support and assistance in establishing efficient
communications between Mallinckrodt and MBI for shipping information, invoicing,
complaints and customer relations information including support of computer
communication systems for information flow;

         (e) Provide sales order entry and technical assistance including
customer service; and

         (f) Provide such technical assistance to MBI in the development of
OPTISON as MBI requests. Each such request shall specify the nature and extent
of the assistance required, and shall be reasonable in respect of the type of
assistance requested and the resources, time and cost required to render that
assistance. Mallinckrodt shall advise MBI if Mallinckrodt considers MBI's
request unreasonable, and the parties shall attempt in good faith to resolve
their differences.

         3.05  MARKETING.

         (a) Promptly after Mallinckrodt's annual marketing and sales plan for
ALBUNEX is approved internally each year, Mallinckrodt shall provide MBI with an
appropriately detailed summary of the plan for MBI's internal use.

         (b) Mallinckrodt shall, from time to time and in its sole discretion,
establish the prices at which ALBUNEX shall be sold by it or its Affiliates.
Terms of all sales, including but not limited to credit, billing and shipments,
shall be established by Mallinckrodt in its sole discretion.

<PAGE>

                                    ARTICLE 4

                                    PAYMENTS

         4.01 MILESTONE PAYMENTS. Subject to the limitations, terms and
conditions contained in this Agreement, Mallinckrodt shall pay to MBI (i) the
sum of $6,000,000 United States dollars by cashier's check or by wire transfer
in immediately available funds upon execution of this Agreement and (ii) the
following amounts by cashiers' check or by wire transfer in immediately
available funds if, and only if, the particular stated milestone is achieved by
MBI:

         (a) PHASE III OF HUMAN CLINICAL TRIALS. $3,333,000 due in 4 successive
quarterly installments of $833,250 each, with the first quarterly installment
payable 30 days after the date MBI provides Mallinckrodt written notice
accompanied by supporting documentation that MBI has commenced the initial Phase
III of the first Human Clinical Trials for ALBUNEX with an indication as set
forth in APPENDIX 4;

         (b) FDA APPLICATION. $3,333,000 due in 4 successive quarterly
installments of $833,250 each, with the first quarterly installment payable 30
days after the date MBI provides Mallinckrodt written notice accompanied by
supporting documentation that MBI has submitted to the FDA either its initial
PMA application or its initial NDA application for ALBUNEX;

         (c) FDA ACCEPTANCE OF APPLICATION. $3,334,000 due in 4 successive
quarterly installments of $833,500 each, with the first quarterly installment
payable 30 days after the date MBI provides Mallinckrodt written notice
accompanied by supporting documentation that the FDA has accepted either MBI's
initial PMA application or initial NDA application for ALBUNEX;

         (d) FDA APPROVAL. $8,000,000 due in 4 successive quarterly installments
of $2,000,000 each, with the first quarterly installment payable 30 days after
the date MBI provides Mallinckrodt written notice accompanied by a copy of the
FDA initial approval letter that the FDA has issued its initial approval letter
for ALBUNEX with an indication as set forth in APPENDIX 4; and

         (e) FIRST COMMERCIAL SHIPMENT. $3,000,000 due in 4 successive
quarterly installments of $750,000 each, with the first quarterly installment
payable 30 days after the date Mallinckrodt accepts MBI's first commercial
shipment of ALBUNEX under ARTICLE 2.

In no event shall Mallinckrodt be obligated to make payments except with respect
to the first instance in which a particular milestone is achieved. MBI
acknowledges that Mallinckrodt has previously made all of the payments that
Mallinckrodt was required to make under SECTION 4.01.

         4.02 INITIAL MARKETING PAYMENT.

         (a) In addition to the other amounts due under ARTICLE 4, Mallinckrodt
shall pay MBI an amount of United States dollars equal to the amount of Net
Sales of ALBUNEX in the Territory for the 365-day period commencing on the
Launch Date.

         (b) Mallinckrodt shall deliver to MBI within 60 days after the end of
such 365-day period, as the case may be, a true and accurate report, covering
such period in sufficient detail to accurately account for gross sales and all
adjustments used to derive Aggregate Net Sales subject to this SECTION 4.02.

         (c) Simultaneously with the delivery of the report described in SECTION
4.02(b), Mallinckrodt shall pay MBI the amount described in SECTION 4.02(a) for
such period covered by the report. The payment shall be made in United States
dollars.

<PAGE>

         (d) Notwithstanding anything in this SECTION 4.02 to the contrary,
Mallinckrodt shall not be obligated to pay in excess of $30,000,000 pursuant to
this SECTION 4.02 regardless of the amount of Net Sales during the 365-day
period commencing on the Launch Date.

         (e) MBI acknowledges that Mallinckrodt has previously made all of the
payments that Mallinckrodt was required to make under SECTION 4.02.

         4.03 FEINSTEIN ROYALTIES.

         (a) Provided that MBI has timely made all prior royalty payments to Dr.
Stephen B. Feinstein pursuant to the Feinstein License, Mallinckrodt shall pay
to MBI in trust for further payment by MBI to Dr. Stephen B. Feinstein an amount
equal to one-half of MBI's royalty obligations to Dr. Stephen B. Feinstein
pursuant to the Feinstein License attributable to Net Sales of ALBUNEX, up to a
maximum of 3% of Net Sales of ALBUNEX; provided, however, that Mallinckrodt
shall pay to MBI for MBI's account a royalty of 3% on the first $66,666,666.67
of Net Sales of ALBUNEX in the United States, and shall pay to MBI a royalty of
3% on the next $33,333,333.33 of Net Sales of ALBUNEX in the United States, of
which MBI shall pay one-half to Dr. Stephen B. Feinstein and the other one-half
shall be for MBI's account. As of the date that Mallinckrodt begins to
manufacture ALBUNEX for commercial sale following the earlier of (i) termination
of this Agreement pursuant to which the licenses granted in this Agreement by
MBI to Mallinckrodt survive such termination pursuant to SECTION 14.03 or (ii)
the exercise by MBI of its rights pursuant to Sections 9.01(a) OR (b) and the
satisfaction of the conditions contained in SECTIONS 9.01(c) AND 9.03,
Mallinckrodt's obligation to pay MBI pursuant to the foregoing sentence shall
increase (in the case of (ii), in respect of the affected territory only) to an
amount equal to the total of MBI's royalty obligation pursuant to the Feinstein
License attributable to Net Sales of ALBUNEX, up to a maximum of 6% of Net Sales
of ALBUNEX. All payments to MBI pursuant to this SECTION 4.03(a) (i) shall be
made not later than 5 business days prior to the due date of the payment by MBI
to Dr. Steven B. Feinstein under the Feinstein License, (ii) to the extent
payable to Dr. Steven B. Feinstein, shall be held by MBI in a segregated trust
account held for the benefit of Dr. Steven B. Feinstein, and (iii) shall be
remitted by MBI from such trust account to Dr. Steven B. Feinstein on or before
the due date of such payment under the Feinstein License.

         (b) MBI understands that Mallinckrodt may wish to approach Dr. Steven
B. Feinstein and discuss with him the possibility of a direct license to
Mallinckrodt in the event there is a termination of the Feinstein License.
Mallinckrodt shall advise MBI in advance if it desires to hold such discussions
with Dr. Steven B. Feinstein and MBI shall be permitted to participate in such
discussions, provided, however, MBI shall not be obligated to pay any additional
consideration to Dr. Steven B. Feinstein or to undertake any other additional
financial obligation.

         (c) SECTION 5.2 of the Feinstein License requires MBI to pay Dr.
Feinstein a royalty of 1.25% of the Net Selling Price of Licensed Products sold
by sublicensees of MBI or by an affiliate of any such sublicensee in any country
other than the United States (as "Net Selling Price" and "Licensed Products" are
defined in SECTIONS 1.4 AND 1.2, respectively, of the Feinstein License).
Subject to SECTION 3.02F of this Agreement, Mallinckrodt shall pay to MBI, for
payment to Dr. Feinstein, a royalty of 0.75% (= 1.25% x 0.60) on Net Sales of
ALBUNEX in the Nycomed Territory. Royalties payable under this SECTION 4.03(c)
shall be paid pursuant to the procedures in SECTION 2.14.

                                    ARTICLE 5

                                 CONFIDENTIALITY

         5.01 GENERAL. At all times during the term of this Agreement and
thereafter, MBI and Mallinckrodt shall keep confidential, not use and not
disclose to third parties any and all of the Confidential Information of the
other party (Mallinckrodt Confidential Information in MBI's case and MBI
Confidential Information in Mallinckrodt's case), except as expressly authorized
by prior written consent of the other party or as provided in this Agreement,

<PAGE>

and except to those of its employees as necessary for the performance of this
Agreement so long as such employee has signed a confidentiality and non-use
agreement with terms no less restrictive than set out herein.

         5.02 EXCEPTIONS TO CONFIDENTIALITY. The obligation of confidentiality
and restriction on use imposed by ARTICLE 5 shall not apply to any Confidential
Information that:

         (a) Was in the public domain prior to the date of this Agreement or
subsequently came into the public domain through no fault of such party; or

         (b) Was lawfully received by such party from a third party free of any
obligation of confidence to such third party; or

         (c) Was already in the possession of such party prior to receipt
thereof, directly or indirectly, from the other party; or

         (d) Is required to be disclosed in a judicial or administrative
proceeding after all reasonable legal remedies for maintaining such information
in confidence have been exhausted; or

         (e) Is subsequently and independently developed by employees,
consultants or agents of the disclosing party without reference to the
Confidential Information disclosed.

         5.03 REGULATORY. MBI and Mallinckrodt are permitted to provide to
governmental personnel and agencies, including but not limited to the FDA, all
materials required by such personnel or agency in conjunction with an inspection
of MBI's or Mallinckrodt's facilities, or any governmental submission, report,
license, application or similar item, by MBI or Mallinckrodt, including but not
limited to all documentation and test results relating to ALBUNEX, and samples
of ALBUNEX.

         5.04 CONSULTANTS OR LABORATORIES. MBI or Mallinckrodt may employ the
services of consultants or laboratories as part of the goods and services to be
provided pursuant to this Agreement if each such consultant or laboratory signs
a confidentiality agreement no less restrictive than the confidentiality and
non-use provisions in this Agreement. MBI and Mallinckrodt may disclose the
terms of this Agreement to their respective attorneys, accountants, lenders,
insurance brokers and underwriters, and investment bankers, or as required by
law.

         5.05 PUBLICATIONS. Each party (the Disclosing Party) shall submit to
the other (the "RECEIVING PARTY") at least 90 days prior to submission or
disclosure to any third party, all manuscripts, abstracts, articles, memorandum
or other similar documents relating to ALBUNEX proposed to be published,
disclosed or discussed in any scientific, trade, industry or other publication,
meeting or forum. The Reviewing Party shall notify the Disclosing Party if, in
the reasonable judgment of the Reviewing Party, the proposed disclosure would
violate the terms of this ARTICLE 5. Thereafter, the Disclosing Party shall not
disclose, publish or otherwise make public, the proposed disclosure and shall
take all reasonable steps to prevent such disclosure or publication.

                                    ARTICLE 6

                    REPRESENTATIONS, WARRANTIES AND COVENANTS

         6.01 REPRESENTATIONS, WARRANTIES AND COVENANTS OF MALLINCKRODT.
Mallinckrodt hereby covenants, represents and warrants to MBI that:

         (a) Neither the execution and delivery by it of this Agreement nor the
consummation of the transactions contemplated hereby will violate any law or
regulation, or conflict with or result in a breach of or default under any
agreement, license, instrument, judgment, decree or order to which it is a party
or by which it is bound.

<PAGE>

         (b) No approval or consent of any governmental agency or
instrumentality is required for the authorization, execution, or delivery by it
of this Agreement.

         (c) Neither this Agreement nor any document or certificate furnished to
MBI by Mallinckrodt pursuant to this Agreement contains any untrue statement of
a material fact or omits to state a material fact necessary in order to make the
statements contained herein and therein not misleading.

         (d) The execution and delivery of this Agreement and the performance by
Mallinckrodt of its obligations hereunder are within Mallinckrodt's corporate
power, have been duly authorized by proper corporate action on the part of
Mallinckrodt and are not in violation of the Certificate of Incorporation or
By-Laws of Mallinckrodt.

         (e) During Phase 3, all ALBUNEX manufactured by Mallinckrodt pursuant
to ARTICLE 2 will be manufactured or produced in a good and workmanlike manner,
in compliance with then-current FDA Good Manufacturing Practices, and shall be
merchantable, and be fit for the purposes for which it was produced.

         (f) During Phase 3, all ALBUNEX manufactured by Mallinckrodt pursuant
to ARTICLE 2: (i) will be manufactured or produced in compliance with the
Occupational Safety and Health Act, as amended, and the Fair Labor Standards
Act, as amended; (ii) will not be adulterated or misbranded within the meaning
of the Federal Food Drug & Cosmetic Act, and will not be articles which may not,
under the provisions of Sections 404 or 505 of such Act, or any similar state or
local laws, be introduced into interstate commerce; (iii) will comply with all
other applicable standards which are necessary for the manufacture, use or sale
of ALBUNEX including, but not limited to, all rights in patents, trademarks, FDA
approvals, registrations or permits, and all other regulatory permits, approvals
and licenses necessary for the manufacture, use or sale of ALBUNEX; and (iv) use
only USP Human Serum Albumin that is 100% tested and certified AIDS and
Hepatitis B free.

         6.02 REPRESENTATIONS, WARRANTIES AND COVENANTS OF MBI. MBI covenants,
represents and warrants to Mallinckrodt that:

         (a) Neither the execution and delivery by it of this Agreement nor the
consummation of the transactions contemplated hereby will violate any law or
regulation, or conflict with or result in a breach of or default under any
agreement, license, instrument, judgment, decree or order to which it is a party
or by which it is bound.

         (b) No approval or consent of any governmental agency or
instrumentality is required for the authorization, execution, or delivery by it
of this Agreement.

         (c) Neither this Agreement nor any document or certificate furnished to
Mallinckrodt by MBI pursuant to this Agreement contains any untrue statement of
a material fact or omits to state a material fact necessary in order to make the
statements contained herein and therein not misleading. All product and testing
data, and all Know-how and other data and information supplied by MBI with
respect to or in connection with ALBUNEX is and will be accurate and does not
and will not contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make it not misleading.

         (d) The execution and delivery of this Agreement and the performance by
MBI of its obligations hereunder are within MBI's corporate power, have been
duly authorized by proper corporate action on the part of MBI and are not in
violation of the Certificate of Incorporation or By-Laws of MBI.

         (e) Except as provided in SECTION 2.03(d), (i) Mallinckrodt shall have
the exclusive non-cancelable right and license to manufacture, use and sell
ALBUNEX in the Territory, the Additional Territory and the Nycomed Territory,
and (ii) MBI has not appointed, and will not appoint any other distributor,
representative or agent to sell or distribute ALBUNEX in the Territory, the
Additional Territory and the Nycomed Territory (except for Nycomed in the
Nycomed Territory).

<PAGE>

         (f) To the best of MBI's knowledge, ALBUNEX can now and hereafter be
manufactured, used and sold in the Territory, the Additional Territory and the
Nycomed Territory without substantial risk of infringement of any right,
interest, or patent of any third party.

         (g) MBI owns or controls the Technology Rights and, to the best of
MBI's knowledge, the patents and patent applications now contained in the
Technology Rights are of sufficient scope to protect ALBUNEX, its production,
use and sale, and any patents, including patents issuing on any of such patent
applications, are, or will be upon issuance, reasonably enforceable.

         (h) There is no claim, suit, proceeding or other investigation pending
or, except as set forth in SCHEDULE 6.02(h), threatened against MBI in
connection with the research, development, manufacture, sale, use or
distribution of ALBUNEX, or which would prevent the performance of this
Agreement.

         (i) During Phases 1 and 2, all ALBUNEX sold by MBI to Mallinckrodt
pursuant to ARTICLE 2 will be manufactured or produced in a good and workmanlike
manner, in compliance with then-current FDA Good Manufacturing Practices, and
shall be merchantable, and be fit for the purposes for which it was produced.

         (j) During Phases 1 and 2, all ALBUNEX sold by MBI to Mallinckrodt
pursuant to ARTICLE 2: (i) will be manufactured or produced in compliance with
the Occupational Safety and Health Act, as amended, and the Fair Labor Standards
Act, as amended; (ii) will not be adulterated or misbranded within the meaning
of the Federal Food Drug & Cosmetic Act, and will not be articles which may not,
under the provisions of Sections 404 or 505 of such Act, or any similar state or
local laws, be introduced into interstate commerce; (iii) will comply with all
other applicable standards which are necessary for the manufacture, use or sale
of ALBUNEX including, but not limited to, all rights in patents, trademarks, FDA
approvals, registrations or permits, and all other regulatory permits, approvals
and licenses necessary for the manufacture, use or sale of ALBUNEX; and (iv) use
only USP Human Serum Albumin that is 100% tested and certified AIDS and
Hepatitis B free.

         (k) MBI has spent at least $10 million on clinical trials to support
regulatory filings in the United States for cardiac indications of ALBUNEX and
the related compilation, analysis and presentation of clinical results and other
ancillary activities, as directed by the Joint Steering Committee.

         (l) MBI has spent at least $10 million on ALBUNEX development,
including, but not limited to, the development of new ALBUNEX indications,
products and processes, related preclinical and clinical studies and trials,
intellectual property protection, ALBUNEX manufacturing maintenance and
development (including manufacturing overhead) and compliance with FDA and state
regulatory requirements (including required filings and submissions and
necessary validations, qualifications and over approvals and proceedings).

                                    ARTICLE 7

                              LICENSE OF TECHNOLOGY

         7.01 TECHNOLOGY RIGHTS.

         (a) MBI hereby grants to Mallinckrodt a license of, including the right
to sublicense others under, the Technology Rights and Know-how, in order to
test, evaluate and develop ALBUNEX covered thereby, and to make, use, promote,
sell, offer to sell and otherwise commercialize ALBUNEX in the Territory, the
Additional Territory and the Nycomed Territory. Subject only to the limitations
contained in SECTIONS 9.01(a) AND (b), AND 14.03(b) and MBI's utilization of the
Technology Rights and Know-how to perform its obligations pursuant to this
Agreement (including MBI's right to manufacture ALBUNEX), this license from MBI
is exclusive, perpetual and non-cancelable:

                  (1) in the Territory;

<PAGE>

                  (2) in the Additional Territory; and

                  (3) in the Nycomed Territory, subject to (A) Nycomed's rights
         in the Nycomed Territory under the Nycomed Agreement, as amended by the
         Nycomed License Amendment, and (B) the terms of the Nycomed Territory
         Amendment.

         (b) MBI hereby grants to Mallinckrodt and to its Affiliates and
sublicensees the right to grant irrevocable licenses to end users of ALBUNEX, to
use ALBUNEX obtained directly or indirectly from Mallinckrodt, its Affiliates or
its sublicensees for any purpose within the Technology Rights or the Know-how.
Subject only to (i) the limitations contained in SECTIONS 9.01, 9.02 AND
14.03(b), (ii) MBI's utilization of the Technology Rights and Know-how to
perform its obligations pursuant to this Agreement (including MBI's right to
manufacture ALBUNEX) and (iii) the same limitations in SECTIONS 7.01(a)(2)-(3),
this license from MBI is exclusive, perpetual and non-cancelable.

         7.02 MBI TRADEMARKS.

         (a) MBI hereby grants to Mallinckrodt and to its Affiliates and
sublicensees a royalty-free right and license in perpetuity to use any MBI
Trademark on or in connection with the manufacture, advertising, distribution,
or sale of ALBUNEX made by or on behalf of Mallinckrodt, its Affiliates or
sublicensees in the Territory, the Additional Territory and the Nycomed
Territory. Prior to the exercise by MBI of its rights under SECTIONS 9.01(a) OR
(b), and subject to the limitations of SECTION 14.03, this license is
non-cancelable and is exclusive with respect to all others including MBI.

         (b) Mallinckrodt undertakes that the quality of goods sold and offered
for sale under the MBI Trademarks or trademarks licensed by Mallinckrodt from
MBI pursuant to SECTION 7.02(a) (collectively the "TRADEMARKS") shall conform to
the standards approved by the appropriate regulatory authorities in the
Territory, the Additional Territory and the Nycomed Territory, respectively.
Mallinckrodt undertakes to use all reasonable efforts to ensure that the said
standards conform to the standards of quality for said goods approved in writing
by the other party.

         (c) MBI shall have the right of access through a duly authorized agent
to Mallinckrodt's business premises at reasonable intervals and during ordinary
business hours for the purpose of inspecting and/or testing the goods sold or
offered for sale under the Trademarks upon written request to Mallinckrodt by
MBI.

         (d) The Trademarks shall be used only in accordance with generally
accepted trademark practices. Any usage by Mallinckrodt in advertising,
promotional materials or otherwise shall be submitted to MBI for informational
purposes. Mallinckrodt will take into account the comments of MBI.

         (e) Mallinckrodt agrees to notify MBI in writing of any conflicting
uses of and applications for registration of the Trademarks or of any acts of
infringement or of unfair competition involving the Trademarks promptly after
such matters are brought to its attention or it has knowledge thereof.

         7.03 TECHNOLOGY TRANSFER AND IMPROVEMENTS.

         (a) MBI shall from time to time provide, or cause to be provided, to
Mallinckrodt copies of all pharmacological, toxicological, and clinical data and
reports, stability data, manufacturing, quality control, and other information,
Know-how, technology and discoveries of Know-how relating to ALBUNEX now or
hereafter known to, or possessed, acquired or developed by MBI which are needed
or helpful to manufacture, have manufactured, use or sell ALBUNEX in the
Territory, the Additional Territory and the Nycomed Territory. All such items
known to, possessed, acquired or developed by MBI, regardless if transferred to
Mallinckrodt, shall be deemed to be included in the licenses granted pursuant to
SECTION 7.01 without any further action required by MBI. All information
described in this SECTION 7.03(a) shall be regarded as Confidential Information.

<PAGE>

         (b) MBI shall promptly notify and make available to Mallinckrodt all of
MBI's improvements to ALBUNEX (including additional indications), its method of
use and its method of manufacture, and all of such improvements, regardless if
transferred to Mallinckrodt, shall be deemed to be included in the licenses
granted pursuant to SECTION 7.01 without any further action required by MBI.

         7.04 ANCILLARY DEVICES. Mallinckrodt and MBI agree that any device,
tool or similar item related to or helpful in the sale, use or application of
ALBUNEX that is not covered by the Technology Rights or Know-how that is now or
hereinafter owned or controlled by either of them (an Ancillary Devices) shall
be discussed with the other party. Prior to disclosure or discussion with third
parties, each agrees to negotiate in good faith with the other the opportunity
of marketing the Ancillary Device in connection with the sale of ALBUNEX and the
possibility of an economic arrangement similar to that for ALBUNEX established
pursuant to this Agreement.

         7.05 COMPETING PRODUCTS.

         (a) Mallinckrodt shall promptly notify MBI of an opportunity for
Mallinckrodt to acquire, purchase, or license from a third party any technology
relating to products described in SECTIONS 1.05, and which is not covered by any
Technology Rights, or which does not incorporate, is not covered by or is not
made by the use of Know-how (the "MALLINCKRODT PURCHASED COMPETING TECHNOLOGY").
Mallinckrodt shall license its rights to the Purchased Competing Technology to
MBI upon MBI's satisfactory undertaking of 40% of all past, present and future
costs and expenses (including future royalties or other payments) incurred or to
be incurred by Mallinckrodt in connection with or arising out of the
acquisition, purchase or license of the Mallinckrodt Purchased Competing
Technology. Such license shall provide for an economic arrangement similar to
that for ALBUNEX established pursuant to this Agreement. If MBI does not
satisfactorily undertake within a reasonable time to pay 40% of all such costs
and expenses, Mallinckrodt may utilize its rights to the Mallinckrodt Purchased
Competing Technology in any manner whatsoever free and clear of any restraints
or obligations imposed by this Agreement; without limitation, it may manufacture
or purchase from others any products made by using the Mallinckrodt Purchased
Competing Technology.

         (b) MBI shall promptly notify Mallinckrodt of an opportunity for MBI to
acquire, purchase, or license from a third party of any technology relating to
products described in SECTIONS 1.05, and which is not covered by any Technology
Rights, or which does not incorporate, is not covered by or is not made by the
use of Know-how (the "MBI PURCHASED COMPETING TECHNOLOGY"). MBI shall license
its rights to the MBI Purchased Competing Technology to Mallinckrodt upon
Mallinckrodt's satisfactory undertaking of 60% of all past, present and future
costs and expenses (including future royalties or other payments) incurred or to
be incurred by MBI in connection with or arising out of the acquisition,
purchase or license of the MBI Purchased Competing Technology. Such license
shall provide for an economic arrangement similar to that for ALBUNEX
established pursuant to this Agreement. If Mallinckrodt does not satisfactorily
undertake within a reasonable time to pay 60% of all such costs and expenses,
MBI may utilize its rights to the MBI Purchased Competing Technology in any
manner whatsoever free and clear of any restraints or obligations imposed by
this Agreement; without limitation, it may manufacture or purchase from others
any products made by using the MBI Purchased Competing Technology.

         (c) Notwithstanding the foregoing, Mallinckrodt shall have no
obligation under this SECTION 7.05 if Mallinckrodt does not use or plan to use
the Mallinckrodt Purchased Competing Technology, or if MBI does not use or plan
to use the MBI Purchased Competing Technology, to compete with ALBUNEX in the
market for in vivo contrast agents for ultrasound and echocardiography
diagnostic imaging.

<PAGE>

                                    ARTICLE 8

                                     PATENTS

         8.01 PATENT EXPENSES.

         (a) Mallinckrodt shall be responsible for the expenses of the
maintenance of (i) U.S. Patent No. 4,572,203 entitled "Contact (sic) Agents for
Ultrasonic Imaging" issued February 25, 1986, (ii) U.S. Patent No. 4,718,433
entitled "Contrast Agents for Ultrasonic Imaging" issued January 12, 1988, a
continuation-in-part of U.S. Patent No. 4,572,203, (iii) U.S. Patent No.
4,774,958 entitled "Ultrasonic Imaging Agent and Method of Preparation" issued
October 4, 1988, a continuation-in-part of U.S. Patent No. 4,718,433, and any
current continuing applications or future applications thereof in the United
States of America or Canada, and of the continuation and maintenance of the 3
U.S. pending patent applications of Dr. Kenneth Widder assigned to MBI in the
United States of America or Canada.

         (b) With respect to any other patent filings, Mallinckrodt and MBI
shall notify the other of any potentially patentable invention relating to
ALBUNEX covering any portion of the Know-how or Technology Rights. The parties
thereafter shall meet and discuss the appropriateness and strategy of filing
patent applications in any country of the Territory, the Additional Territory
and the Nycomed Territory.

         (c) If MBI, in its reasonable discretion, determines to file any patent
application in the Territory, the Additional Territory or the Nycomed Territory
covering any portion of the Know-how or Technology Rights, MBI shall be
responsible for prosecution and maintenance of the patent application, but
Mallinckrodt shall be responsible for the payment of all maintenance fees for
the resulting patent (if issued). (If a third party is contractually required by
an agreement with MBI to pay any such maintenance fees, however, Mallinckrodt
shall have no obligation to pay them unless MBI gives Mallinckrodt written
notice at least 30 days before payment is due that the third party has not yet
paid them, in which case Mallinckrodt shall pay the maintenance fees on or
before the date due if MBI requests (unless, in the meanwhile, the third party
pays them).

         (d) If MBI does not file a particular patent application in the
Territory, the Additional Territory or the Nycomed Territory covering any
portion of the Know-how or Technology Rights, Mallinckrodt may request MBI to do
so, and if MBI declines Mallinckrodt's request (either by informing Mallinckrodt
to that effect or by failing to respond to Mallinckrodt's request within 30 days
after receipt of the request), Mallinckrodt may file, prosecute and maintain
that patent application. MBI shall provide Mallinckrodt with sufficient
information (to the extent in MBI's possession or under its control) and other
cooperation (including necessary signatures of MBI employees) to permit
Mallinckrodt to do so. If Mallinckrodt does so, it shall be responsible for the
payment of all maintenance fees of the resulting patent (if issued).

         (e) MBI and Mallinckrodt shall each cooperate and render reasonable
assistance to the other in connection with the activities contemplated by this
SECTION 8.01.

         8.02 PATENT INFRINGEMENT.

         (a) MALLINCKRODT'S RIGHT TO ENFORCE. Mallinckrodt shall have the right,
with respect to any injury or loss suffered or threatened to be suffered by
Mallinckrodt as a result of the infringement or threatened infringement of MBI's
patents relating to ALBUNEX in the Territory, the Additional Territory or the
Nycomed Territory, to enforce MBI's affected patents and prosecute infringers,
if MBI elects not to bring suit covering such injury or loss within 3 months
after the earlier of (i) the date that MBI learns of any such patent
infringement other than by written notice from Mallinckrodt or (ii) the date
that Mallinckrodt gives MBI written notice of any such patent infringement.

         (b) COOPERATION. In the event either party hereto shall initiate or
carry on legal proceedings to enforce patents against an alleged infringer, the
other party hereto shall fully cooperate with the party initiating or carrying
on-such proceedings.

<PAGE>

         (c) LITIGATION PROCEDURES. Either party shall have the right during
the time that this Agreement is in effect, and subject to its terms
(including, but not limited to, SECTIONS 8.01 AND 8.02(a)), to sue infringers
of patents and either party shall permit the use of its name in all such
suits, shall sign all necessary papers, take all rightful oaths, and upon
reasonable request shall assist the other party in such suits at its own
expense.

         (d) LITIGATION BY MALLINCKRODT. In the event Mallinckrodt shall
institute suit or legal proceedings to enforce any patent, MBI shall be
entitled to be represented by counsel of its own choosing, at its sole
expense. From any recovery awarded or settlement reached as a result of such
suit or legal proceedings, Mallinckrodt (i) may deduct the full amount of its
expenses of prosecuting the same (including attorneys' fees and court costs);
(ii) shall pay to MBI, to the extent possible after payment of (i) above, the
full amount of MBI's cost of participating in the same; (iii) shall pay to
MBI, after full payment of (i) and (ii) above, 50% of any remainder to the
extent the recovery or settlement relates to any period in which
Mallinckrodt's licenses under this Agreement had not terminated under SECTION
14.03(b) (with the exception in either case that to the extent that the
recovery or settlement is in respect of Mallinckrodt's injuries or losses
regarding ALBUNEX manufactured by Mallinckrodt, the amount payable to MBI
under this SECTION 8.02(d) (iii) shall be a percentage of the remainder
determined in a manner consistent with the royalty payable by Mallinckrodt in
respect of Net Sales of such ALBUNEX, as the case may be); and (iv) may retain
the balance. Mallinckrodt shall not discontinue or settle any such suit or
other legal proceedings brought by it without obtaining the prior concurrence
of MBI, which shall not be unreasonably withheld and giving MBI a timely
opportunity to continue such proceedings in its own name, under its sole
control at its sole expense, provided that Mallinckrodt's reasonable
litigation expenses (including attorneys fees and court costs) shall be
reimbursed by MBI.

         (e) LITIGATION BY MBI. In the event MBI shall institute suit or legal
proceedings to enforce any patent and the suit or legal proceedings are, in
whole or in part, in respect of any injury or loss suffered or threatened to
be suffered by Mallinckrodt as a result of the infringement or threatened
infringement of MBI's patents relating to ALBUNEX in the Territory, the
Additional Territory or the Nycomed Territory, Mallinckrodt shall be entitled
to be represented by counsel of its own choosing, at its sole expense. From
any recovery awarded or settlement reached as a result of such suit or legal
proceedings, MBI (i) may deduct the full amount of its expenses of prosecuting
the same (including attorneys' fees and court costs); (ii) shall pay to
Mallinckrodt, to the extent possible after payment of (i) above, the full
amount of Mallinckrodt's cost of participating in the same; (iii) shall pay to
Mallinckrodt, after full payment of (i) and (ii) above, 50% of any remainder
to the extent the recovery or settlement relates to any period thereafter in
which Mallinckrodt's licenses under this Agreement had not terminated under
SECTION 14.03(b) and is in respect of Mallinckrodt's injuries or losses (with
the exception in either case that to the extent that the recovery or
settlement is in respect of Mallinckrodt's injuries or losses regarding
ALBUNEX manufactured by Mallinckrodt, the amount payable to Mallinckrodt under
this SECTION 8.02(e) (iii) shall be the remainder less a percentage of the
remainder determined in a manner consistent with the royalty payable by
Mallinckrodt in respect of Net Sales of such ALBUNEX, as the case may be); and
(iv) may retain the balance. MBI shall not discontinue or settle any such suit
or other legal proceedings brought by it without obtaining the prior
concurrence of Mallinckrodt, which shall not be unreasonably withheld, and
giving Mallinckrodt a timely opportunity to continue such proceedings in its
own name, under its sole control, and at its sole expense, provided that MBI's
reasonable litigation expenses (including attorneys fees and court costs)
shall be reimbursed by Mallinckrodt.

         8.03 PATENT INDEMNIFICATION.

         (a) MBI shall indemnify and hold harmless Mallinckrodt against any
and all Losses based on and resulting from any claim of infringement of any
patent of a third party in the United States of America, Canada, any of the
countries of Western Europe (as that term is commonly understood), Japan,
Australia or New Zealand and which claim arises from Mallinckrodt's
manufacture, use or sale of ALBUNEX pursuant to this Agreement.

         (b) With respect to any other Losses based on and resulting from any
claim of infringement of any patent in a country in the Territory, the
Additional Territory or the Nycomed Territory (other than a country named or
referred to SECTION 8.03(a)) and which claim arose from Mallinckrodt's
manufacture, use or sale of ALBUNEX pursuant to this Agreement, Mallinckrodt
shall be responsible for 60% of any such Loss and MBI shall be responsible for
40% of any such Loss (with the exception that if any such Loss is in respect
of ALBUNEX manufactured by Mallinckrodt, MBI shall be responsible for a
percentage of the Loss determined in a manner

<PAGE>

consistent with the royalty payable by Mallinckrodt in respect of Net Sales of
such ALBUNEX, as the case may be and Mallinckrodt shall be responsible for the
remainder of the Loss).

         (c) In the event any third party asserts any claim with respect to
any matter as to which the indemnities in this SECTION 8.03 relate, the party
against whom the claim is asserted shall give prompt notice to the other
party. The party who has the responsibility to pay the entire potential Loss
or the greatest share of the potential Loss, as the case may be (the
"INDEMNIFYING PARTY"), shall have the right at its election to take over the
defense or settlement of the third party claim at its own expense by giving
prompt notice to the other party (the "INDEMNIFIED PARTY"). If the
Indemnifying Party does not give such notice and does not proceed diligently
so to defend the third party claim within 30 days after receipt of the notice
of the third party claim, the Indemnifying Party shall be bound by any defense
or settlement that the Indemnified Party may make as to those claims, and
shall reimburse the Indemnified Party for its Losses and expenses related to
the defense or settlement of the third party claim. The Indemnifying Party
shall be bound by any settlement that the Indemnified Party may make, however,
only if the Indemnified Party gives the Indemnifying Party at least 15 days
prior written notice of the settlement and either (i) the Indemnifying Party
does not object to the proposed settlement by written notice to the
Indemnified Party within 10 days after receipt of the Indemnified Party's
notice or (ii) if the Indemnifying Party does timely object to the proposed
settlement, the Indemnifying Party does not at the same time agree to (A)
undertake the further defense of the third party claim, (B) indemnify the
Indemnified Party for any Loss in excess of its proposed settlement and (C)
reimburse the Indemnified Party for its reasonable expenses related to the
defense of the third party claim. Upon request of the Indemnified Party, the
Indemnified Party shall be consulted from time to time and be informed of the
status of the third party claim. The parties shall cooperate in defending
against any asserted third party claims. For purposes of this SECTION 8.03,
the indemnification of the Indemnified Party shall also include the
indemnification of the Indemnified Party's employees, agents, Affiliates, and
third parties performing services for the Indemnified Party.

                                    ARTICLE 9

                            RIGHTS TO ACQUIRE ALBUNEX

         9.01 NEGOTIATIONS TO ACQUIRE ALBUNEX. For a period (the "EXCLUSIVE
PERIOD") commencing with the execution of this Agreement, MBI shall not sell
or otherwise dispose of (by license or otherwise) any of its rights, assets or
technology relating to ALBUNEX or MBI's interest in any Technology Rights or
Know-How. During the Exclusive Period either MBI or Mallinckrodt may initiate
good faith discussions regarding the acquisition by Mallinckrodt of any of the
foregoing.

           If, at the end of the Exclusive Period, Mallinckrodt and MBI have
not agreed to such an acquisition, MBI shall have the following options
separately as to each of the Territory, the Additional Territory and the
Nycomed Territory:

         (a) Subject to the right of Mallinckrodt to continue to make, use,
distribute and sell ALBUNEX in the same territory pursuant to the licenses
granted in ARTICLE 7, MBI may co-market and distribute ALBUNEX in a particular
territory under the MBI label and for its own account and may do so in the
same manner (including, but not limited to, the use of distributors or sales
representatives), on a country-by-country basis, as Mallinckrodt from time to
time may market and distribute ALBUNEX in that territory;

         (b) Subject to (i) the right of Mallinckrodt to continue to make,
use, distribute and sell ALBUNEX in the same territory pursuant to this
Agreement, (ii) Mallinckrodt's right of first refusal under SECTION 9.02 and
(iii) the restrictions set forth in SECTIONS 9.01(d), (e) AND (f), MBI may
sell or dispose of (by license or otherwise) to a single transferee, other
than pursuant to an assignment permitted in ARTICLE 16.02(d), in a single
transaction, all but not less than all, of MBI's rights, assets and technology
relating to ALBUNEX in a particular territory and all, but not less than all,
of MBI's interest in any Technology Rights or Know-how as it relates to that
territory, and such

<PAGE>

transferee shall not be subject to the any of the limitations and restrictions
on MBI under SECTION 9.01, except for the restrictions in SECTION 9.01(e), or
to Mallinckrodt's right of first refusal under SECTION 9.02; or

         (c) MBI may continue its existing relationship with Mallinckrodt
pursuant to the terms of this Agreement in a particular territory, subject to
MBI's option to exercise its rights under SECTIONS 9.01(a) OR (b) at a later
time. The exercise of option (a) by MBI at any time in respect of a particular
territory shall not preclude MBI from exercising option (b) at a later time in
respect of that territory.

         (d) If MBI exercises any of its options under SECTIONS 9.01(a) AND
(b) in respect of any territory, Mallinckrodt may manufacture ALBUNEX in any
quantities for sale in that territory and shall be payable to MBI in respect
of Net Sales in that territory of ALBUNEX manufactured after MBI's exercise of
the option in question.

         (e) MBI or any of its licensees exercising their rights under
SECTIONS 9.01(a) OR (b) must purchase all ALBUNEX only from Mallinckrodt.

         (f) If, at any time, MBI elects to exercise any of its rights under
SECTIONS 9.01(a) OR (b), MBI or whoever performs the services

         9.02 MALLINCKRODT'S RIGHT OF FIRST REFUSAL. MBI grants Mallinckrodt a
right of first refusal to purchase MBI's rights, assets and technology
relating to ALBUNEX in each of the Territory, the Additional Territory, the
Nycomed Territory and the Asian Territory, and MBI's interest in any
Technology Rights or Know-how (collectively, in respect of any particular
territory, the "ASSETS"), as follows:

         (a) If MBI proposes to sell the Assets, MBI shall give Mallinckrodt
written notice of MBI's intention (the "SALES NOTICE"), providing all relevant
details and copies of all relevant documents, including but not limited to any
letter of intent and any draft or executory sales agreement.

         (b) Mallinckrodt shall have 45 days from the date it receives MBI's
Sales Notice in which to exercise its right of first refusal to purchase the
Assets specified in the Sales Notice, at the purchase price and on the terms
specified in the Sales Notice, by giving MBI written notice to that effect. If
Mallinckrodt notifies MBI that Mallinckrodt declines to exercise its right of
first refusal, or if Mallinckrodt fails to exercise its right of first refusal
in a timely manner, MBI may proceed to sell the Assets to the purchaser
identified in the Sales Notice but only at a purchase price and on terms at
least as favorable to MBI as those specified in the Sales Notice. If MBI fails
to consummate such sale within 75 days of the Sales Notice, then the
provisions of this SECTION 9.02 shall thereafter apply to any subsequent
proposed disposition of the Assets.

         (c) If the purchase price specified in the Sales Notice includes any
property other than money, MBI and Mallinckrodt shall jointly determine the
value of this other property. If they are unable to agree on its value within
45 days from the date Mallinckrodt receives MBI's Sales Notice, they shall
each promptly select a nationally or regionally recognized investment banking
firm or consulting firm, and these 2 firms shall select a third such firm (the
"VALUATION FIRM") to determine the value of this other property. The Valuation
Firm's determination shall be conclusive. MBI and Mallinckrodt shall use their
best efforts to ensure that the Valuation Firm makes its determination not
later than 5 business days after its selection. The period in which
Mallinckrodt may exercise its right of first refusal shall be extended to 5
business days after the Valuation Firm's determination. MBI and Mallinckrodt
shall each pay the fees of the firm that it selects and one-half of the fees
of the Valuation Firm.

         (d) In the case of a proposed sale of the Assets relating to the
Territory, Mallinckrodt shall have a credit against the purchase price
specified in MBI's Sales Notice equal to:

                  (1) the sum of the payments by Mallinckrodt pursuant to
         SECTIONS 4.01 AND 4.02 less

                  (2) an amount equal to of Net Sales in the Territory prior to
         the date of Mallinckrodt's receipt of the Sales Notice (if such
         difference is less than zero, there shall be no credit).

<PAGE>

         (e) In the case of a proposed sale of the Assets relating to the
Nycomed Territory, Mallinckrodt shall have a credit against the purchase price
specified in MBI's Sales Notice equal to:

                  (1) the sum of the payments by Mallinckrodt pursuant to
         SECTIONS 3.02C(a) AND (b) less

                  (2) an amount equal to of Net Sales in the Nycomed Territory
         prior to the date of Mallinckrodt's receipt of the Sales Notice (if
         such difference is less than zero, there shall be no credit).

         (f) In the case of a proposed sale of the Assets relating to the
Asian Territory, Mallinckrodt shall have a credit against the purchase price
specified in MBI's Sales Notice equal to:

                  (1) the sum of the payments by Mallinckrodt to acquire any
         rights in any of the Asian Territories less

                  (2) an amount equal to of Net Sales in the Asian Territory
         prior to the date of Mallinckrodt's receipt of the Sales Notice (if
         such difference is less than zero, there shall be no credit).

         (g) If Mallinckrodt exercises its right of first refusal, closing of
its purchase shall take place on the date and at the location that the parties
agree on, but no later than 75 days after the date of Mallinckrodt's notice to
MBI exercising Mallinckrodt's right of first refusal. If Mallinckrodt does not
exercise its right of first refusal, any sale is subject to Mallinckrodt's
rights under this Agreement.

         9.03 MALLINCKRODT ABANDONMENT OF ALBUNEX, EXCLUDING INFOSON AND FIRST
GENERATION PRODUCT.

         (a) Other than Infoson and the First Generation Product, Mallinckrodt
shall be deemed to have abandoned ALBUNEX if all of the following conditions
occur after the Launch Date:

                  (1) ALBUNEX may be lawfully sold in the United States of
         America in interstate commerce, without any threat of infringement
         upon any third party rights, any threat of any action by any
         regulatory agency, including but not limited to the FDA, or any
         threat of product recall, or any danger to the safety of the users of
         ALBUNEX or the public generally;

                  (2) MBI has supplied and continues to offer to supply,
         ALBUNEX in sufficient quantities to Mallinckrodt conforming to the
         Product Specifications during Phases 1 and 2; and

                  (3) Mallinckrodt has failed to offer at least one Albunex
         Product, other than Infoson and the First Generation Product, for sale
         in the ordinary course of business for a continuous period of not less
         than 180 days.

         (b) Upon satisfaction of all the conditions described in SECTION
9.02(a) and receipt by Mallinckrodt of the following:

                  (1) Payment by cashier's check or by wire transfer in
         immediately available funds an amount equal to the sums previously
         paid by Mallinckrodt to MBI pursuant to SECTIONS 4.01 AND 4.02; and

                  (2) An Unconditional Waiver and Release pursuant to which MBI
         waives any and all rights, claims, damages or other remedies against
         Mallinckrodt relating to or out of this Agreement, in a form
         satisfactory to counsel for Mallinckrodt;

this Agreement shall terminate.

         9.04 MALLINCKRODT FAILURE TO EXPEND ADEQUATE RESOURCES. (FOR
HISTORICAL PURPOSES ONLY)

<PAGE>

         (a) Mallinckrodt shall be deemed to have failed to commit adequate
resources to the marketing, sale or distribution of ALBUNEX if all of the
following conditions occur:

                  (1) Prior to the Launch Date Mallinckrodt fails to spend at
         least $500,000 in out of pocket costs in the pre-marketing, marketing,
         sales, distribution, or promotion of ALBUNEX, including but not
         limited to advertising, marketing literature, symposia, focus groups,
         product promotion, trade and industry shows, and the recruitment of
         medical and scientific opinion leaders;

                  (2) During the first year following the Launch Date
         Mallinckrodt fails to spend at least $500,000 in out of pocket costs
         in the marketing, sales, distribution, or promotion of ALBUNEX,
         including but not limited to advertising, marketing literature,
         symposia, focus groups, product promotion, trade and industry shows,
         and the recruitment of medical and scientific opinion leaders; and

                  (3) Mallinckrodt fails to spend such amounts within the 180
         day period beginning on the date MBI notifies Mallinckrodt in writing
         that Mallinckrodt has failed to spend the such amounts.

         (b) Upon satisfaction of all the conditions described in SECTION
9.03(a) and receipt by Mallinckrodt of payment by cashier's check or by wire
transfer in immediately available funds in an amount equal to one-half of the
sums previously paid by Mallinckrodt to MBI pursuant to SECTIONS 4.01 AND
4.02, subject to the right of Mallinckrodt to continue to distribute and sell
ALBUNEX in the Territory pursuant to this Agreement, the provisions of ARTICLE
2 shall terminate and MBI may co-market and distribute ALBUNEX in the
Territory under the MBI label and for its own account and may do so in the
same manner (including, but not limited to, the use of distributors or sales
representatives), on a country-by-country basis, as Mallinckrodt from time to
time may market and distribute ALBUNEX in the Territory.

         (c) MBI acknowledges that Mallinckrodt has not failed to commit
adequate resources to the marketing, sale or distribution of ALBUNEX, as
described in SECTION 9.03(a).

                                   ARTICLE 10

            PAYMENTS TO KEY EMPLOYEES (FOR HISTORICAL PURPOSES ONLY)

         10.01    KEY EMPLOYEE PAYMENTS.

         (a) Subject to the terms and conditions of this SECTION 10.01, during
the 2 year period commencing on the Launch Date of ALBUNEX by Mallinckrodt if
the first commercial sale of ALBUNEX after the Launch Date actually occurs,
Mallinckrodt shall, at times to be agreed to by the parties, pay to MBI an
aggregate of $2,500,000 upon accomplishment of the milestones described in
SECTION 10.01(b). Mallinckrodt and MBI agree that a minimum payment shall be
due by the due date of MBI's tax return for MBI's tax year in which the first
commercial sale of ALBUNEX after the Launch Date actually occurs (including
extensions thereof as are actually obtained by MBI) of an amount equal to that
which is certified by MBI's independent public accountants to be the increase
in MBI's actual federal and state income tax liability, if any, due on such
date as a result of MBI's accrual into income of the full amount to be paid by
Mallinckrodt under this SECTION 10.01 provided that no such minimum payment
shall be due prior to the first actual commercial Salem ALBUNEX after the
Launch Date. MBI shall advise Mallinckrodt of this amount no later than 30
days prior to the filing of MBI's return and shall afford Mallinckrodt a
reasonable opportunity to verify the accuracy of such amount. The amounts paid
by Mallinckrodt to MBI shall be distributed by MBI to such employees of MBI as
shall be mutually agreed to by MBI and Mallinckrodt.

         (b) The portion of the $2,500,000 attributable to the accomplishment
of the applicable milestone shall be determined as follows:

<TABLE>
<CAPTION>

          AMOUNT                                                           MILESTONE

<PAGE>
         <S>                                         <C>
         $400,000                                    Commencement of initial Phase III of the first Human
                                                     Clinical Trials for ALBUNEX as described in APPENDIX 4
                                                     [SECTION 4.01(a)].

         $400,000                                    MBI's submission to the FDA either its initial PMA
                                                     application or its initial ADA application for ALBUNEX
                                                     [SECTION 4.01(b)].

         $400,000                                    FDA's acceptance of either MBI's initial PMA application or
                                                     initial NDA application for ALBUNEX [SECTION 4.01(c)]

         $950,000                                    FDA's issuance of its initial approval letter for ALBUNEX
                                                     with the specifications at least equal to those set forth
                                                     in APPENDIX 4 [SECTION 4.01(c)].

         $350,000                                    Mallinckrodt's acceptance of MBI's first commercial
                                                     shipment of ALBUNEX under ARTICLE 2 [SECTION 4.01(c)].

</TABLE>

The foregoing amounts relating to any particular milestone shall be due and
payable so long as the stated milestone is achieved by MBI and the first
commercial sale of ALBUNEX after the Launch Date actually occurs. If any
particular milestone is not achieved, then Mallinckrodt shall have no
obligation to pay the amount related to such milestone. In no event shall
Mallinckrodt be obligated to make payments except with respect to the first
instance in which a particular milestone is achieved and then only if the
first commercial sale of ALBUNEX after the Launch Date actually occurs.

         (c) As each milestone is achieved by MBI, the amount related to such
milestone will accrue and bear interest at the from time to time prime rate of
interest of Citibank, N.A. commencing on the date the related payment under
SECTION 4.01 is due until the amount is paid. Notwithstanding anything in this
SECTION 10.01 to the contrary, Mallinckrodt shall have no obligation to make
any payments under this SECTION 10.01, including interest, unless and until
Mallinckrodt or its Affiliates makes its first commercial sale of ALBUNEX
after the Launch Date.

         (d) Notwithstanding anything to the contrary in this SECTION 10.01,
no MBI employee shall be a third party beneficiary to this SECTION 10.01 and
shall not be entitled to bring suit to enforce this SECTION 10.01.

         10.02 PAYMENTS. MBI acknowledges that Mallinckrodt has previously
made all of the payments that Mallinckrodt was required to make under SECTION
10.01.

                                   ARTICLE 11

                              COMMERCIAL VIABILITY

         11.01 DETERMINATION OF COMMERCIAL VIABILITY. If the commercial
viability of ALBUNEX is seriously jeopardized such that the continued
development of ALBUNEX will not result in a commercially viable product to
Mallinckrodt, then Mallinckrodt shall initiate good faith discussions with MBI
to terminate this Agreement effective with the date such discussions are
initiated, provided however, that if such discussions do not result in
resolution of the matter, they shall be subject to arbitration under ARTICLE
12 to determine if the commercial viability of ALBUNEX is seriously
jeopardized such that the continued development of ALBUNEX will not result in
a commercially viable product to Mallinckrodt. If such arbitrators determine
that the commercial viability of ALBUNEX is so jeopardized, then Mallinckrodt
shall have the immediate right to terminate this Agreement effective with the
date such discussions were initiated. This SECTION 11.01 shall be effective
until the FDA permits the marketing of ALBUNEX for (i) intravenous myocardial
profusion indication and (ii) radiological indications.

<PAGE>

                                   ARTICLE 12

                               DISPUTE RESOLUTION

         12.01 BINDING ARBITRATION. Except as otherwise provided in SECTION
12.02, any claim, dispute, question or controversy arising out of or relating
to this Agreement or any amendment or modification hereto, or breach thereof
(undisputed), shall be resolved by arbitration in accordance with the
procedures specified in this Section, which shall be the sole and exclusive
procedures for the resolution of any such disputes; PROVIDED, HOWEVER, that a
party, without prejudice to the procedures specified herein, may institute
litigation for the limited purposes of tolling any applicable statute of
limitations or to seek a temporary restraining order, preliminary injunction
or other provisional judicial relief, if in its sole judgement such action is
necessary to avoid irreparable damage or to preserve the STATUS QUO. Despite
such action, the parties will continue to participate in good faith in the
procedures specified in this Section.

         The arbitration shall be conducted in accordance with the then
current AAA rules for commercial disputes by three independent and impartial
arbitrators from a list provided by AAA and selected as provided herein. The
Expedited Rules of the AAA shall apply. Each party shall select an arbitrator
and, then, the two selected arbitrators shall select a third arbitrator. The
arbitration shall be binding and shall be governed by the United States
Arbitration Act, 9 U.S.C. Sections 1-16, and judgment upon the award rendered
by the arbitrators maY be entered by any court having jurisdiction thereof.
The place of arbitration shall be St. Louis County, Missouri. The arbitrators
are empowered to award attorneys fees and expenses in the arbitration. The
award of the arbitrators shall be in writing, and shall state the reasoning on
which the award is based.

         Any arbitration shall be confidential. No arbitrator may testify or
produce materials, or be compelled to testify or to produce materials, in any
proceeding related to any dispute.

         All applicable statutes of limitation and defenses based upon the
passage of time shall be tolled while the procedures specified in the Section
are pending. The parties will take such action, if any, required to effectuate
such tolling. This Section is an essential part of this Agreement, is legally
binding upon the parties and may be enforced in any court having jurisdiction
thereof.

         12.02 INJUNCTIONS. The parties recognize and agree that arbitration
is inadequate to enforce (a) the confidential restrictions contained in
ARTICLE 5 and the provisions in ARTICLES 2 OR 6 regarding compliance with
governmental health and safety laws and regulations a breach of which would
pose an imminent danger to public health and safety, (b) the provisions
requiring arbitration, or (c) the sale of ALBUNEX by Mallinckrodt in the
continents of Europe, Asia, Africa or Australia other than as and when
permitted by this Agreement (each singularly, an "EVENT"), a violation of any
will cause irreparable harm and unascertainable damages. The parties agree
that an aggrieved party shall be entitled as a matter of right to an
injunction from a court of competent jurisdiction restraining any actual or
threatened Event. The right to injunctive relief shall be in addition to, and
not in lieu of, all other rights and remedies of the aggrieved party under
this Agreement, by statute, at law, in equity or otherwise (such as the right
to arbitrate Disputes, requiring an accounting and repayment of all profits,
compensation, remuneration or other benefits realized in violation of this
Agreement).

         12.03 COSTS AND MISSOURI COURTS. The fees and expenses of the
arbitrators shall be shared equally by Mallinckrodt and MBI. Mallinckrodt and
MBI consent to the jurisdiction of the United States District Court for the

<PAGE>

Eastern District of Missouri, and if such District Court shall not have
jurisdiction in the matter for any reason, to the jurisdiction of the Circuit
Court of the State of Missouri for the 21st Judicial Circuit, for all purposes
in connection with this Agreement, including entry of judgment relating to any
award of the arbitrators. The arbitration and any award rendered pursuant
thereto shall be governed by, construed and enforced in accordance with the
laws of the State of Missouri.

         12.04 REMEDIES CUMULATIVE. All rights and remedies granted in this
Agreement or available under applicable law shall be deemed concurrent and
cumulative, and not alternative or exclusive remedies, to the full extent
permitted by law and this Agreement. Any party may proceed with any number of
remedies at the same time or in any order. The exercise of any one right or
remedy shall not be deemed a waiver or release of any other right or remedy.

                                   ARTICLE 13

                                 INDEMNIFICATION

         13.01 INDEMNIFICATION BY MBI. MBI shall indemnify and hold harmless
Mallinckrodt against any and all Losses based on or resulting from (i) any
breach of the representations and warranties of MBI contained herein; (ii) any
breach of any warranty by MBI (express or implied) relating to ALBUNEX; (iii)
any or all claims arising from the use of ALBUNEX provided by MBI to
Mallinckrodt pursuant to ARTICLE 2, including, but not limited to, any claim
for death or personal injury or damage or loss of property which shall have
been caused or alleged to have been caused by any negligence on the part of
MBI or its agents, any defect in design, materials or workmanship used in
ALBUNEX or any claim under a theory of strict liability; (iv) any inaccuracies
contained in the Product Literature based on information provided by MBI or
any other information supplied by MBI with ALBUNEX; (v) any governmental
recall of ALBUNEX due to or arising out of an act or omission of MBI, or, (vi)
in the event that ALBUNEX (other than ALBUNEX manufactured by a party other
than MBI or an Affiliate of MBI) is found not to comply with any governmental
regulations, for any costs or expenses incurred by Mallinckrodt to bring
ALBUNEX into compliance with such regulations after consultation with MBI,
including, but not limited, any costs and expenses of securing any required
governmental permits.

         13.02 INDEMNIFICATION BY MALLINCKRODT. Mallinckrodt shall indemnify
and hold harmless MBI against any and all Losses sustained by MBI resulting
from, arising out of or connected with (i) any inaccuracy in, breach of or
nonfulfillment of, any representation, warranty, covenant or agreement made
by, or other obligation of, Mallinckrodt contained in this Agreement or (ii)
any or all claims arising from the use of ALBUNEX manufactured by Mallinckrodt
or acquired by Mallinckrodt from a third party (E.G., Hafslund Nycomed AS),
including, but not limited to, any claim for death or personal injury or
damage or loss of property which shall have been caused or alleged to have
been caused (with respect to ALBUNEX so manufactured or acquired) by (A) any
negligence on the part of Mallinckrodt, its agents or supplier or suppliers of
ALBUNEX, (B) any defect in design, materials or workmanship used in such
ALBUNEX or (C) any claim under a theory of strict liability. Notwithstanding
the foregoing, if Mallinckrodt breaches one of the representations or
warranties set forth in SECTION 6.02 concerning manufacturing pursuant to
SECTION 13.02(i), Mallinckrodt shall not be liable for lost profits.

         13.03 PROCEDURES. In the event any third party asserts any claim with
respect to any matter as to which the indemnities in this Agreement relate,
the party against whom the claim is asserted (the Indemnified Party) shall
give prompt notice to the other party (the Indemnifying Party), and the
Indemnifying Party shall have the right at its election to take over the
defense or settlement of the third party claim at its own expense by giving
prompt notice to the Indemnified Party. If the Indemnifying Party does not
give such notice and does not proceed diligently so to defend the third party
claim within 30 days after receipt of the notice of the third party claim, the
Indemnifying Party shall be bound by any defense or settlement that the
Indemnified Party may make as to those claims and shall reimburse the
Indemnified Party for its Losses and expenses related to the defense or
settlement of the third party claim. The parties shall cooperate in defending
against any asserted third party claims. For purposes of this ARTICLE 13, the
indemnification of the Indemnified Party shall also include the
indemnification of the Indemnified Party's

<PAGE>

employees, agents, Affiliates, and third parties performing services for the
Indemnified Party, and the reference to this Agreement includes any
certificate, schedule, list, summary or other information provided or
delivered to a party by the Indemnifying Party or its agents and Affiliates in
connection with this Agreement.

                                   ARTICLE 14

                              TERM AND TERMINATION

         14.01 TERM. Unless sooner terminated pursuant to the provisions of
this Agreement, the term of this Agreement shall continue until the last
patent licensed in SECTION 7.01 expires.

         14.02 TERMINATION. This Agreement may be terminated:

         (a) At any time by mutual written consent of MBI and Mallinckrodt; or

         (b) By either party by notice to the other in the event such other
party shall dissolve, cease active business operations or liquidate unless
this Agreement shall have been assigned to a successor or transferee pursuant
to SECTION 16.02, or in the event such other party shall have been determined
to be insolvent by a court of competent jurisdiction, or insolvency or
reorganization proceedings shall have been commenced by such other party, or
such proceedings shall have been brought against such other party and remained
undismissed for a period of 60 days or such other party shall have made a
general assignment for the benefit of creditors, or a receiver of all or
substantially all of such other party's assets shall have been appointed and
not discharged within 60 days; or

         (c) By Mallinckrodt, if MBI shall fail to timely make any payment
required by this Agreement and such payment shall not have been made within 30
days after receipt of written demand therefore from Mallinckrodt unless MBI
is, in good faith, contesting or disputing its obligation to make any such
payment or disputing the amount thereof; or

         (d) By MBI, if Mallinckrodt shall fail to timely make any payment
required by this Agreement and such payment shall not have been made within 30
days after receipt of written demand therefore from MBI unless Mallinckrodt
is, in good faith, contesting or disputing its obligation to make any such
payment or disputing the amount thereof; or

         (e) By Mallinckrodt by notice to MBI in the event of a breach or
default by MBI of any material obligation, covenant, agreement, condition,
representation or warranty in this Agreement (other than (i) a breach or
default covered by SECTION 14.02(c) or (ii) a breach or default of any of
MBI's Manufacturing Obligations) if Mallinckrodt shall have given written
notice to MBI of such breach or default and such breach or default shall not
have been remedied within 60 days after receipt of such written notice and, if
not remedied by MBI within the 60 day period, reasonable steps shall not have
been undertaken to remedy such breach or default within such period and shall
not have been diligently pursued thereafter; or

         (f) By MBI by notice to Mallinckrodt in the event of a breach or
default by Mallinckrodt of any material obligation, covenant or agreement in
this Agreement (other than (i) a breach or default covered by SECTION
14.02(d), or (ii) a breach or default under SECTION 2.14(b)) if MBI shall have
given written notice to Mallinckrodt of such breach or default and such breach
or default shall not have been remedied within 60 days after receipt of such
written notice and, if not remedied by Mallinckrodt with the 60 day period,
reasonable steps shall not have been undertaken to remedy such breach or
default within such period and shall not have been diligently pursued
thereafter.

         (g) Notwithstanding Mallinckrodt's continuing authority to
manufacture under SECTION 14.03, if MBI has terminated this Agreement pursuant
to SECTIONS 14.02(b), (d) OR (f) and if Mallinckrodt fails to make any
undisputed royalty payment due to MBI under this Agreement when due (and does
not cure its default within 30 days), the manufacturing license granted to
Mallinckrodt under SECTION 14.03 shall automatically terminate.

<PAGE>

         14.03 SURVIVAL OF MALLINCKRODT LICENSES AND RIGHT OF FIRST REFUSAL.

         (a) If this Agreement terminates by the expiration of its term under
SECTION 14.01, the licenses granted to Mallinckrodt by MBI under this
Agreement shall survive and continue as .

         (b) If this Agreement terminates by the written consent of the
parties pursuant to SECTION 14.02(a), the licenses granted to Mallinckrodt by
MBI under this Agreement, Mallinckrodt's royalty obligations under SECTION
14.03(d)(3), Mallinckrodt's right of first refusal under SECTION 9.02, and the
other provisions of this Agreement shall survive as MBI and Mallinckrodt may
agree.

         (c) If this Agreement terminates following notice from Mallinckrodt
pursuant to SECTIONS 14.02(b), (c) OR (e):

                  (1) the licenses granted to Mallinckrodt by MBI under this
         Agreement shall survive and continue as perpetual and irrevocable
         paid-up royalty free licenses but shall become nonexclusive on the
         earlier of (i) the fifth anniversary of the date that the FDA approves
         an intravenous myocardial perfusion indication of ALBUNEX for sale in
         the United States or (ii) the date this Agreement would otherwise
         terminate under the provisions of SECTION 14.01;

                  (2) Mallinckrodt's right of first refusal under SECTION 9.02
         shall survive; and

                  (3) During Phases 1 and 2, Mallinckrodt may recover damages
         resulting from any breach or default of MBI's manufacturing
         obligations which occasions the termination of the Agreement. For
         purposes of this SECTION 14.03(c)(3), damages means actual damages
         and does not include incidental, consequential or punitive damages,
         but (notwithstanding this limitation) does include lost profits on
         sales of ALBUNEX for the period beginning with the occasion of the
         breach and ending with the time Mallinckrodt is lawfully permitted to
         operate an ALBUNEX manufacturing facility capable of producing the
         Albunex Product in question to meet Mallinckrodt's requirements, but
         in no event beyond five years after the date this Agreement is
         executed.

         (d) If this Agreement terminates following notice from MBI pursuant
to SECTIONS 14.02(b), (d), (f) or (g):

                  (1) the licenses granted to Mallinckrodt by MBI under this
         Agreement shall survive and continue as perpetual and irrevocable
         licenses but shall become non-exclusive;

                  (2) Mallinckrodt's right of first refusal under SECTION 9.02
         shall terminate; and

                  (3) Mallinckrodt may continue to manufacture MBI Licensed
         Products in any quantities. With respect to the exercise of such
         right, Mallinckrodt shall pay to MBI after the date of termination a
         royalty at the rate of 10% of the Net Sales of such products.
         Mallinckrodt's royalty obligation under this Section shall continue
         until the last patent licensed in SECTION 7.01 expires.

         14.04 EFFECT OF TERMINATION. Warranty, confidentiality and
indemnification obligations of the parties shall survive termination.

                                   ARTICLE 15

                                  FORCE MAJEURE

         The obligations of each party to perform under this Agreement shall
be subject to any delays caused by Force Majeure, if and only if the party
affected shall have used reasonable efforts to avoid such Force Majeure and to
remedy it promptly if it shall have occurred.

<PAGE>

                                   ARTICLE 16

                                  MISCELLANEOUS

         16.01 RELATIONSHIP OF THE PARTIES. The relationship hereby
established between Mallinckrodt and MBI is solely that of independent
contractors and this Agreement shall not create an agency, partnership, joint
venture or employer/employee relationship, and nothing hereunder shall be
deemed to authorize party to act for, represent or bind the other or any of
its Affiliates except as expressly provided in this Agreement.

         16.02 ASSIGNMENT. This Agreement shall be assignable by either party
only with the written consent of the other party which shall not be
unreasonably withheld, except that (a) either party may assign this Agreement,
without such consent, to the purchaser or transferee of all its assets, or of
all the assets of its business to which this Agreement relates subject to the
limitations on transfer of MBI assets described in ARTICLE 9, (b) Mallinckrodt
may assign this Agreement to an Affiliate with a net worth of not less than
$10,000,000 without the consent of MBI, (c) if permitted by the substantive
laws of the State of Missouri, Mallinckrodt may assign a limited interest in
this Agreement, or a part of this Agreement, as it relates to one or more
countries in any territory, to an Affiliate organized under the laws of the
country or one of the countries in question, and (d) MBI may assign this
Agreement to a subsidiary all of whose stock is owned by MBI. No assignment
pursuant to clauses (b), (c) or (d) shall relieve the assignor from any
liability under this Agreement, and the assignor shall guarantee the
assignee's full and prompt performance of all of its obligations. MBI shall
not subcontract or delegate performance of all or any part of the work called
for under this Agreement without the express prior written consent of
Mallinckrodt which consent shall not be unreasonably withheld except that it
may subcontract its manufacturing obligations under ARTICLE 2 to Mallinckrodt.

         16.03 NOTICE. All notices, communications, demands and payments
required or permitted to be given or made hereunder or pursuant hereto shall
be in writing and sent by receipt by certified or registered mail, postage
prepaid, overnight messenger service, telecopier or personal delivery as
follows:

         If to Mallinckrodt:

                  Mallinckrodt Inc.
                  675 McDonnell Blvd.
                  St. Louis, Missouri 63134
                  Attention: President - Mallinckrodt Imaging Group
                  Telecopier: (314) 654-3107

         with a copy to:

                  Mallinckrodt Inc.
                  675 McDonnell Blvd.
                  St. Louis, Missouri 63134
                  Attention: Vice President and General Counsel
                  Telecopier: (314) 654-5366

         If to MBI:

                  Molecular Biosystems, Inc.
                  10030 Barnes Canyon Road
                  San Diego, California 92121
                  Attention: Chief Operating Officer
                  Telecopier: (619) 452-6187

<PAGE>

         with a copy to:

                  Craig P. Colmar, Esq.
                  Johnson and Colmar
                  Suite 1000
                  300 South Wacker Drive
                  Chicago, Illinois 60606
                  Telecopier: (312) 922-9283

All notices sent by certified or registered mail shall be considered to have
been given two business days after being deposited in the mail. All notices
sent by overnight messenger service, telecopier or personal delivery shall be
considered to have been given when actually received by the intended
recipient. Either party may change the address designated by notifying the
other party in writing.

         16.04 GOVERNING LAW. This Agreement is deemed to have been entered
into in the State of Missouri, and its interpretation, construction, and the
remedies for its enforcement or breach are to be applied pursuant to and in
accordance with the substantive laws of the State of Missouri.

         16.05 VALIDITY OF AGREEMENT. If any provision of this Agreement is,
becomes, or is deemed invalid or unenforceable in any jurisdiction, such
provision shall be deemed amended to conform to applicable law so as to be
valid, legal and enforceable in such jurisdiction so deeming. The validity,
legality and enforceability of such provision shall not in any way be affected
or impaired thereby in any other jurisdiction. If such provision cannot be so
amended without materially altering the intention of the parties, it shall be
stricken in the jurisdiction so deeming, and the remainder of this Agreement
shall remain in full force and effect.

         16.06 WAIVER. No waiver of any right under this Agreement shall be
deemed effective unless contained in a writing signed by the party charged
with such waiver, and no waiver of any right arising from any breach or
failure to perform shall be deemed to be a waiver of any future such right or
of any other right arising under this Agreement. No failure on the part of any
party to exercise, and no delay in exercising, any right, power or remedy
hereunder shall operate as a waiver thereof, nor shall an single or partial
exercise of any such right, power or remedy by a party preclude any other or
further exercise thereof or the exercise of any other right, power or remedy.
All remedies hereunder are cumulative and are not exclusive of any other
remedies provided by law.

         16.07 ENTIRE AGREEMENT. This Agreement together with (i) the
Investment Agreement dated as of December 7, 1988 between MBI and Mallinckrodt
Medical, Inc. and (ii) the 1995 Investment Agreement set forth and constitute
the entire agreement between the parties hereto with respect to the subject
matter hereof, and supersedes any and all prior agreements, promises,
understandings, promises and representations made by either party to the other
concerning the subject matter hereof and the terms applicable hereto.
Mallinckrodt shall not be bound by and expressly objects to any provisions
additional to or at variance with the terms hereof that may appear in MBI's
quotation, acknowledgement, confirmation, invoice or in any other prior or
later communication from MBI to Mallinckrodt unless such provision is
expressly agreed to in writing by Mallinckrodt referring to this SECTION 16.07
signed by the Chief Executive Officer or a Vice President of Mallinckrodt. MBI
shall not be bound by and expressly objects to any provisions additional to or
at variance with the terms hereof that may appear in Mallinckrodt's quotation,
acknowledgement, confirmation, invoice or in any other prior or later
communication from Mallinckrodt to MBI unless such provision is expressly
agreed to in writing by MBI referring to this SECTION 16.07 signed by the
President of MBI.

         16.08 HEADINGS AND REFERENCES; INCORPORATION OF EXHIBITS. In general,
the headings contained in this Agreement are inserted for convenience of
reference only and shall not be a part, control or affect the meaning hereof,
with the exception of the heading "For Historical Purposes Only", which shall
mean that the applicable Section is not an effective part of the Agreement,
but rather, that the Section is included only for its value as an historical
reference. All references herein to Articles and Sections are to the Articles
and Sections of this Agreement. All references herein to Appendices are to the
Appendices hereto, each of which shall be incorporated into and deemed a part
of this Agreement.

<PAGE>

         16.09 COUNTERPARTS. This Agreement may be executed in counterparts,
each of which shall be deemed to be an original, but which together shall
constitute one and the same instrument.

         16.10 SETOFF. If within 30 days after receipt of written demand any
amount required to be paid hereunder is not paid and unless the payer is, in
good faith, contesting or disputing its obligation to make any such payment or
disputing the amount thereof, the payee may set-off any and all amounts owed
by the payee to the payor against any and all amounts owed by the payer to the
payee.

         16.11 PAYMENT FOR EQUIPMENT, SUPPLIES, AND INVENTORY. Mallinckrodt
shall purchase from MBI at fair market value all manufacturing equipment and
supplies that it deems necessary, desirable or useful in establishing
Mallinckrodt's Manufacturing Operations. Mallinckrodt will purchase from MBI
at cost all inventories that are useful to Mallinckrodt in manufacturing and
marketing OPTISON, so long as Mallinckrodt was involved in the decision to
purchase such inventories.

         16.12 HSR FILINGS. MBI and Mallinckrodt shall each comply with the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the
"HART-SCOTT-RODINO ACT"), by filing a pre-merger notification with the U.S.
Department of Justice and the U.S. Federal Trade Commission as promptly as
practicable after signing this Agreement, and shall respond promptly to any
inquires from the Department of Justice or the Federal Trade Commission as a
result of these filings. [FOR HISTORICAL PURPOSES ONLY]

         16.13 EFFECTIVE DATE. To the extent that this Agreement is a
restatement of :

         (a) the Original Distribution Agreement, this Agreement shall be
deemed to have been effective since December 7, 1988;

         (b) ARDA, this Agreement shall be deemed to have been effective since:

                  (1) December 7, 1988, if such provision was restated by ARDA,
                  (2) September 7, 1995, for SECTION 16.12, or
                  (3) the expiration or termination of the applicable waiting
         periods under the Hart-Scott-Rodino Act, if such provision was changed
         by ARDA;

         (c) the Nycomed Territory Amendment and the Supplemental Letter, this
Agreement shall be deemed to have been effective since November 6, 1996.

         To the extent that this Agreement is an amendment of ARDA, as amended
by the Nycomed Territory Amendment and the Supplemental Letter, all changes
shall be effective as of the date that this Agreement is signed.

         16.14 RESEARCH QUANTITIES. MBI has received requests from researchers
and clinicians for samples of the First Generation Product. MBI may (but shall
not be required to) fill these requests if doing so is legally permissible as
long as the quantities provided are minimal and intended only for non-clinical
basic research. MBI shall keep Mallinckrodt promptly and fully informed of
MBI's activities in this regard.

         16.15 As of the Effective Date, the Agreement between MBI and
Mallinckrodt will be

         16.16 EFFECT OF ARBITRATION ON TERMINATION. This Agreement shall not
be deemed terminated by a party pursuant to SECTIONS 14.02(b), (c), (d), (e),
(f) OR (g) if the other party is disputing the propriety of termination
(including but not limited to whether a cure has been effected or reasonable
steps have been taken to cure and have been diligently pursued, where
applicable) and such party has timely filed or served the appropriate
instrument to invoke an arbitration proceeding under SECTION 12.01 of this
Agreement. Such filing or service shall be deemed timely if it takes place (i)
in the case of a SECTION 14.02(b) termination, within 30 days of the notice
described in the first clause of that Section, or (ii) in the case of a
SECTION 14.02(c), (d), (e) OR (f) termination, prior to the expiration of the
applicable remedial period. In the case of a SECTION 14.02(b) termination in
which the arbitrators rule in favor of the party seeking termination, if the
termination is based on dissolution, ceasing business operations, or

<PAGE>

liquidation, the agreement shall be deemed terminated; if the termination is
based on any other termination event described in that Section, the
unsuccessful party shall have 60 days to dismiss the proceeding or discharge
the assignee, as the case may be. In the case of a SECTION 14.02(c), (d), (e),
OR (f) termination, the unsuccessful party shall have the full applicable
remedial period from the date of the arbitrators' decision to effect a cure,
provided that any additional arbitration over whether the cure is effective in
such case shall stay termination for no more than 30 days unless the
arbitrators rule otherwise before that period of time expires. In the case of
a SECTION 14.02(c) OR (d) termination, following the arbitrators' decision the
unsuccessful party may not further forestall termination by claiming a good
faith dispute.

         16.17 MALLINCKRODT'S RIGHT TO LEASE OR OPERATE MBI'S FACILITIES. Upon
the Effective Date of this Agreement, Mallinckrodt shall have the immediate
and non-cancelable right to lease any MBI facilities it deems necessary during
Phases 1 and 2 upon commercially reasonable terms to be agreed upon by the
parties. Mallinckrodt shall have the right to ensure that the MBI's
manufacturing facility is staffed and operated in the most cost-effective
manner for producing OPTISON for Mallinckrodt.

         16.18 SEVERABILITY. If any Section (or part thereof) of this
Agreement is found by a court of competent jurisdiction to be contrary to,
prohibited by or invalid under any applicable law, such court may modify such
Section (or part thereof) so, as modified, such Section (or part thereof) will
be enforceable and will to the maximum extent possible comply with the
apparent intent of the parties in drafting such Section (or part thereof). If
no such modification is possible, such Section (or part thereof) shall be
deemed omitted, without invalidating the remaining provisions hereof. No such
modification or omission of a Section (or part thereof) shall in any way
affect or impair such Section (or part thereof) in any other jurisdiction.

         16.19 UNDERTAKING REGARDING SCHEDULES AND APPENDICES. MBI agrees to
provide correct copies of Schedule 6.02(h) and all Appendices to this
Agreement to Mallinckrodt on or prior to October 7, 1999. If such documents
are not delivered to Mallinckrodt by such date, Mallinckrodt may withhold any
money due MBI until such documents have been provided.

                              [signature page next]

<PAGE>

IN WITNESS WHEREOF, the parties hereunto have executed this Agreement as to be
effective as described in the foregoing paragraph.

THIS CONTRACT CONTAINS A BINDING ARBITRATION PROVISION WHICH MAY BE ENFORCED
BY THE PARTIES.

                                   MOLECULAR BIOSYSTEMS, INC.

                                   By:
                                      -----------------------------------------

                                   Name:   Bobba Venkatadri
                                         ----------------------------------

                                   Title:  President & CEO
                                         ----------------------------------

                                   Date:   September 30, 1999
                                         ----------------------------------

                                   MALLINCKRODT INC.

                                   By:
                                      -----------------------------------------

                                   Name:   Parker B. Condie, Jr.
                                         --------------------------------------

                                   Title:  Business Director, Ultrasound
                                         --------------------------------------

                                   Date:   September 30, 1999
                                         --------------------------------------

                                   MALLINCKRODT INC.

                                   By:
                                      -----------------------------------------

                                   Name:   Bradley J. Fercho
                                         --------------------------------------

                                   Title:  President Imaging Group
                                         --------------------------------------

                                   Date:   September 30, 1999
                                         --------------------------------------<PAGE>
                                                                    EXHIBIT 4.1

  UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO WORLDCOM, INC. (THE
"COMPANY") OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

  THIS CERTIFICATE IS ONE OF THE GLOBAL SECURITIES REFERRED TO IN THE INDENTURE
DESCRIBED HEREIN. UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR
SECURITIES IN DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A
WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE
DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE
DEPOSITARY OR ANY NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF ANY
SUCCESSOR DEPOSITARY.

                                 WORLDCOM, INC.
                           FLOATING RATE NOTE DUE 2001

PRINCIPAL AMOUNT                                                         NO. R-_
________________                                             CUSIP   98157D AA 4
                                                          ISIN NO.: US98157DAA46

  WORLDCOM, INC., a corporation duly organized and existing under the laws of
the State of Georgia (herein called the "Company," which term includes any
successor corporation under the Indenture referred to below), for value
received, hereby promises to pay to CEDE & CO., or registered assigns, the
principal sum of ___________________ DOLLARS on November 26, 2001 (the "Stated
Maturity"), and to pay interest thereon from and including the most recent
Interest Payment Date to which interest has been paid or duly provided for, or,
if no interest has been paid, from and including May 24, 2000, payable in
arrears on February 24, May 24, August 24 and November 24 and at Maturity (each,
an "Interest Payment Date"), commencing on August 24, 2000. The rate of interest
payable from time to time in respect of the Notes (the "Rate of Interest") will
be a floating rate subject to adjustment on a quarterly basis and determined by
reference to LIBOR for three-month U.S. dollar deposits, determined as described
below, plus a spread of 0.23% per annum. The interest so payable, and paid or
duly provided for, on any Interest Payment Date shall, as provided in the
Indenture, be paid to the Person in whose name this Note (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest, which shall be the fifteenth calendar day
(whether or not a Business Day) next preceding such Interest Payment Date at the
office or agency of the Trustee maintained for such purpose in the City of New
York, New York; provided, that interest payable at Maturity will be payable to
the registered Noteholder to whom principal is payable.

  Except as otherwise provided in the Indenture, any such interest not so paid
or duly provided for shall forthwith cease to be payable to the Holder on the
related Regular Record Date and may either be paid to the Person in whose name
this Note (or one or more Predecessor Securities) is registered at the close of
business on a Special Record Date for the payment of such Defaulted Interest to
be fixed by the Trustee, notice whereof shall be given to Holders of Notes (as
defined below) not less than 10 days prior to such Special Record Date, or be
paid at any time in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Notes may be listed, and
upon such notice as may be required by such exchange, all as more fully provided
in the Indenture.

  If any Interest Payment Date, any Redemption Date, the Stated Maturity or the
Maturity shall not be a Business Day (as hereinafter defined), payment of the
amount due on this Note on such date may be made on the next succeeding Business
Day; and, if such payment is made or duly provided for on such

<PAGE>

Business Day, no interest shall accrue on such amounts for the period from and
after such Interest Payment Date, such Redemption Date, the Stated Maturity, or
the Maturity as the case may be, to such Business Day.

  Payment of the principal of (and premium, if any) and interest on this Note at
Maturity shall be made upon presentation hereof at the office or agency of the
Company, one of which will be maintained in Pittsburgh, Pennsylvania (which
initially will be the Corporate Trust Office of Chase Manhattan Trust Company,
National Association, in Pittsburgh, Pennsylvania) or at such other office or
agency permitted under the Indenture, including the office or agency of the
Company maintained for such purpose in the City of New York, New York. Payment
of the principal of (and premium, if any) and interest on this Note shall be
payable in immediately available funds; provided however, that payment of
interest may be made at the option of the Company by check mailed to the address
of the Person entitled thereto as such address shall appear in the Security
Register. Payment of the principal of (and premium, if any) and interest, if
any, on this Note, as aforesaid, shall be made in such coin or currency of the
United States of America as at the time of payment shall be legal tender for the
payment of public and private debts. Interest payable on any Interest Payment
Date will be paid to DTC, Euroclear and/or CEDEL, as the case may be, with
respect to the portion of this Note held for its account by Cede & Co. or a
successor depositary, as the case may be, for the purpose of permitting such
party to credit the interest received by it in respect of this Note to the
accounts of the beneficial owners hereof.

  This Note is one of a duly authorized issue of unsecured senior debt
securities of the Company known as the Company's Floating Rate Notes Due 2001,
initially in the aggregate principal amount of $1,500,000,000 (herein called the
"Notes" or the "Securities"), issued under an Indenture dated as of May 15, 2000
(such Indenture as originally executed and delivered and as hereafter
supplemented or amended, together with the Board Resolution setting forth
certain terms of the Notes adopted on May 19, 2000 and delivered to the Trustee
by the Company pursuant to Section 301 of such Indenture, being herein called
the "Indenture") from the Company to Chase Manhattan Trust Company, National
Association, as trustee (herein called the "Trustee," which term includes any
other successor trustees under the Indenture), to which Indenture, all
indentures supplemental thereto and all Board Resolutions relating thereto
reference is hereby made for a statement of the respective rights, limitations
of rights, duties and immunities thereunder of the Company, the Trustee and the
Holders of the Notes and of the terms upon which the Notes are, and are to be,
authenticated and delivered. The acceptance of this Note shall be deemed to
constitute the consent and agreement of the Holder hereof to all of the terms
and provisions of the Indenture. All capitalized terms used in this Note which
are not defined herein shall have the meaning assigned to them in the Indenture.

  The Notes do not have the benefit of any sinking fund obligations.

  If an Event of Default with respect to the Notes shall occur and be
continuing, the principal of all Notes may be declared due and payable in the
manner and with the effect provided in the Indenture.

  The Company's obligations under this Note and under the covenants provided in
the Indenture are subject to defeasance and discharge as provided in the
Indenture.

  Reference is made to the further provisions of this Note set forth on the
reverse hereof, which provisions shall for all purposes have the same effect as
if set forth at this place.

  Unless the certificate of authentication hereon has been executed by the
Trustee by manual signature, this Note shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose.

                        --------------------------------

                                       2
<PAGE>

  IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed
under its corporate seal.

                                          WORLDCOM, INC.

Attested:
________________________                  By:__________________________
    Secretary                                     President and
                                                      Chief Executive Officer

This is one of the Securities of the series designated therein referred to in
the within-mentioned Indenture.

Dated: May 24, 2000                       CHASE MANHATTAN TRUST COMPANY,
                                               NATIONAL  ASSOCIATION, as Trustee
                                               By:__________________________
                                               Authorized Representative

                                       3
<PAGE>

                                 WORLDCOM, INC.
                           FLOATING RATE NOTE DUE 2001

  The Rate of Interest shall be determined in accordance with the following
provisions:

    (i) At approximately 11:00 a.m. (London time) on the second day on which
  commercial banks are open for business, including dealings in deposits in U.S.
  dollars in London (or, for purposes of paragraph (iii)(B) below, New York),
  prior to the commencement of the Interest Period (defined below) for which
  such rate will apply (each such day an "Interest Determination Date") The
  Chase Manhattan Trust Company, National Association, as the calculation agent,
  or its successors in this capacity (the "Calculation Agent") will calculate
  the rate of interest (the "Rate of Interest") for such Interest Period as,
  subject to the provisions described below, the rate per annum equal to 0.23%
  above the rate appearing on the Dow Jones Telerate Page 3750 (or such other
  page as may replace that page on the Dow Jones Telerate Service) for
  three-month U.S. dollar deposits in the London inter-bank market on such
  Interest Determination Date. The period beginning on, and including, May 24,
  2000, and ending on, but excluding, the first Interest Payment Date and each
  successive period beginning on, and including, an Interest Payment Date and
  ending on, but excluding, the next succeeding Interest Payment Date is herein
  called an "Interest Period".

    (ii) If on any Interest Determination Date an appropriate rate cannot be
  determined from the Dow Jones Telerate Service, the Rate of Interest for the
  next Interest Period shall, subject to the provisions described below, be the
  rate per annum that the Calculation Agent certifies to be 0.23% per annum
  above the arithmetic mean of the offered quotations, as communicated to and at
  the request of the Calculation Agent by not less than two major banks in
  London selected by the Calculation Agent (the "Reference Banks," which term
  shall include any successors nominated by the Calculation Agent), to leading
  banks in London by the principal London offices of the Reference Banks for
  three-month U.S. dollar deposits in the London inter-bank market as at 11:00
  a.m. (London time) on such Interest Determination Date.

    (iii) If on any Interest Determination Date fewer than two of such offered
  rates are available, the Rate of Interest for the next Interest Period shall
  be whichever is the higher of:

      (A) The Rate of Interest in effect for the last preceding Interest Period
    to which (i) or (ii) above shall have applied; and

      (B) The Reserve Interest Rate. The "Reserve Interest Rate" shall be the
    rate per annum which the Calculation Agent determines to be 0.23% per annum
    above either (i) the arithmetic mean of the U.S. dollar offered rates which
    at least two New York City banks selected by the Calculation Agent are or
    were quoting, on the relevant Interest Determination Date, for three-month
    deposits to the Reference Banks or those of them (being at least two in
    number) to which such quotations are or were, in the opinion of the
    Calculation Agent, being so made, or (ii) in the event that the Calculation
    Agent can determine no such arithmetic mean, the arithmetic mean of the U.S.
    dollar offered rates which at least two New York City banks selected by the
    Calculation Agent are or were quoting on such Interest Determination Date to
    leading European banks for a period of three months; provided, however, that
    if the banks selected as aforesaid by the Calculation Agent are not quoting
    as mentioned above, the Rate of Interest shall be the Rate of Interest
    specified in (A) above.

  The Calculation Agent shall, as soon as practicable after 11:00 a.m. (London
time) on each interest Determination Date, determine the Rate of Interest and
calculate the amount of interest payable in respect of the following Interest
Period (the "Interest Amount"). The Interest Amount shall be calculated by
applying the Rate of Interest to the principal amount of each Floating Rate Note
outstanding at the commencement of the Interest Period, multiplying each such
amount by the actual number of days in the Interest Period concerned (which
actual number of days shall include the first day but exclude the last day

                                       4
<PAGE>

of such Interest Period) divided by 360 and rounding the resultant figure
upwards to the nearest cent. The determination of the Rate of Interest and the
Interest Amount by the Calculation Agent shall (in the absence of willful
default, bad faith or manifest error) be final and binding on all parties.
Notwithstanding anything herein to the contrary, the rate of interest on the
Floating Rate Notes shall in no event be higher than the maximum rate permitted
by New York law, as the same may be modified by United States law of general
application.

  The Company shall provide that, so long as any of the Floating Rate Notes
remain outstanding, there shall at all times be a Calculation Agent for the
purpose of the Floating Rate Notes. In the event of the Calculation Agent being
unable or unwilling to continue to act as the Calculation Agent or in the case
of the Calculation Agent failing duly to establish the Rate of Interest for any
Interest Period, the Company shall appoint another leading bank engaged in the
London inter-bank market to act as such in its place. The Calculation Agent may
not resign its duties without a successor having been appointed as aforesaid.

  All certificates, communications, opinions, determinations, calculations,
quotations and decisions given, expressed, made or obtained for the purposes of
the provisions relating to the payment and calculation of interest on the
Floating Rate Notes, whether by the Reference Banks (or any of them) or the
Calculation Agent, shall (in the absence of willful default, bad faith or
manifest error) be binding on the Company, the Calculation Agent and all of the
Holders and no liability shall (in the absence of willful default, bad faith or
manifest error) attach to the Calculation Agent in connection with the exercise
or non-exercise by it of its powers, duties and discretions.

  Interest shall cease to accrue on any Note on Maturity unless, upon
presentation of such Note, payment of principal is improperly withheld or
refused, in which case, interest shall continue to accrue.

         PAYMENT OF ADDITIONAL AMOUNTS. The Company will, subject to certain
exceptions and limitations set forth below, pay such Additional Amounts to the
beneficial owner of this Note who is a Non-U.S. Holder (as defined below) as may
be necessary in order that every net payment of principal of and interest on
such Note and any other amounts payable on such Note, after withholding for or
on account of any present or future tax, assessment or governmental charge
imposed upon or as a result of such payment by the United States (or any
political subdivision or taxing authority thereof or therein), will not be less
than the amount provided for in this Note to be then due and payable. The
Company will not, however, be required to make any such payment of Additional
Amounts to any beneficial owner for or on account of:

                  (a) any such tax, assessment or other governmental charge that
         would not have been so imposed or withheld but for the existence of any
         present or former connection between such beneficial owner (or between
         a fiduciary, settlor, beneficiary, member or shareholder of such
         beneficial owner, if such beneficial owner is an estate, a trust, a
         partnership or a corporation) and the United States and its
         possessions, including, without limitation, such beneficial owner (or
         such fiduciary, settlor, beneficiary, member or shareholder) being or
         having been a citizen or resident thereof or being or having been
         engaged in a trade or business or present therein or having, or having
         had, a permanent establishment therein;

                  (b) any estate, inheritance, gift, sales, transfer or personal
         property tax or any similar tax, assessment or governmental charge;

                  (c) any tax, assessment or other governmental charge imposed
         or withheld by reason of such beneficial owner's past or present status
         as a personal holding company or foreign personal holding company or
         controlled foreign corporation or passive foreign investment company
         with respect to the United States or as a corporation that accumulates
         earnings to avoid United States federal income tax;

                                       5
<PAGE>

                  (d) any tax, assessment or other governmental charge that is
         payable otherwise than by withholding from payments on or in respect of
         this Note;

                  (e) any tax, assessment or other governmental charge that
         would not have been imposed or withheld but for the failure to comply
         with certification, information or other reporting requirements
         concerning the nationality, residence or identity of the beneficial
         owner of this Note, if such compliance is required by statute or by
         regulation of the United States or of any political subdivision or
         taxing authority thereof or therein or by an applicable income tax
         treaty to which the United States is a party as a precondition to
         relief or exemption from such tax, assessment or other governmental
         charge;

                  (f) any tax, assessment or other governmental charge imposed
         or withheld by reason of such beneficial owner's past or present status
         as the actual or constructive owner of 10% or more of the total
         combined voting power of all classes of the Company's stock entitled to
         vote or as a controlled foreign corporation that is related directly or
         indirectly to the Company through stock ownership;

                  (g) to the extent applicable, any tax, assessment or
         governmental charge that is imposed or withheld solely because of a
         change in law, regulation, or administrative or judicial interpretation
         that becomes effective more than 15 days after the payment becomes due
         or is duly provided for, whichever occurs later;

                  (h) any tax, assessment or governmental charge any Paying
         Agent must withhold from any payment of principal of or interest on any
         note, if such payment can be made without such withholding by any other
         Paying Agent; or

                  (i) any combination of clauses (a) through (h) above.

     Such Additional Amounts shall also not be paid with respect to any payment
on this Note to a Non-U.S. Holder who is a fiduciary or partnership or other
than the sole beneficial owner of such payment to the extent such payment would
be required by the laws of the United States (or any political subdivision
thereof) to be included in the income, for tax purposes, of a beneficiary or
settlor with respect to such fiduciary or a member of such partnership or a
beneficial owner who would not have been entitled to such Additional Amounts had
such beneficiary, settlor, member or beneficial owner, as the case may be, held
its interest in this Note directly.

     The term "Non-U.S. Holder" means any person that is, for United States
federal income tax purposes, (i) an individual that is not a citizen or resident
of the U.S., (ii) a corporation organized or created under non-U.S. law, (iii)
an estate or trust that is not subject to U.S. federal income tax on its
worldwide income, or (iv) a foreign partnership to the extent that one or more
of its members is a foreign corporation, a nonresident alien individual or a
nonresident alien fiduciary of a foreign estate or trust.

         TAX REDEMPTION. This Note may be redeemed as a whole, at the Company's
option at any time prior to maturity, upon the giving of a notice of redemption
as described below, if (a) the Company determines that, as a result of any
change in or amendment to the laws (or any regulations or rulings promulgated
thereunder) of the United States or of any political subdivision or taxing
authority thereof or therein, or any change in official position regarding the
application or interpretation of such laws, regulations or rulings, which change
or amendment becomes effective on or after May 19, 2000, the Company has or will
become obligated to pay Additional Amounts as described in the preceding Section
entitled "Payment of Additional Amounts" or (b) a taxing authority of the United
States takes an action on or after May 19, 2000 whether or not with respect to
the Company or any of its Affiliates (as defined in the Indenture) that results
in a substantial probability that the Company will or may be required to pay
such Additional Amounts, in either case, with respect to this Note for reasons
outside its control and after

                                       6
<PAGE>

taking reasonable measures to avoid such obligation. The Note will be redeemed
at a redemption price equal to 100% of the principal amount thereof, together
with accrued interest to the date fixed for redemption. Prior to the giving of
any notice of redemption pursuant to this paragraph, the Company will deliver to
the Trustee:

         (a) an Officer's Certificate (as defined in the Indenture) stating that
   the Company is entitled to effect such redemption and setting forth a
   statement of facts showing that the conditions precedent to its right to so
   redeem have occurred, and

         (b) an Opinion of Counsel (as defined in the Indenture) who is
   independent satisfactory to the Trustee to the effect that the Company has or
   will become obligated or there is a substantial probability that the Company
   will or may be required to pay such Additional Amounts for the reasons
   described above;

   PROVIDED THAT no such notice of redemption pursuant to this paragraph
   entitled "Tax Redemption" shall be given earlier than 60 days prior to the
   earliest date on which the Company would be obligated to pay such Additional
   Amounts if a payment in respect of the Note were then due.

     Notice of redemption pursuant to the preceding paragraph entitled "Tax
Redemption" will be given not less than 30 nor more than 60 days prior to the
date fixed for redemption, which date and the applicable redemption price will
be specified in the notice.

  The Indenture permits, with certain exceptions as thereby provided, the
Trustee to enter into one or more supplemental indentures for the purpose of
adding any provisions to, or changing in any manner or eliminating any of the
provisions of, the Indenture or of modifying in any manner the rights of the
Holders of Securities, in any such case, with the consent of the Holders of not
less than majority in aggregate principal amount of all Outstanding Securities
affected by such supplemental indenture; provided, however, that no such
supplemental indenture shall, without the consent of the Holder of each of the
Outstanding Securities affected thereby, affect certain rights of such Holders
as more fully described in the Indenture.

  The Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities then Outstanding, on behalf of
the Holders of all Securities affected thereby, to waive certain past defaults
of the Company under the Indenture and their consequences. In addition, without
the consent of any Holder of a Security, the Indenture and the Securities may be
amended and supplemented to cure any defect, ambiguity or inconsistency, make
other changes which will not adversely affect in any material respect the rights
of the Holders or certain other matters specified in the Indenture. Any such
consent or waiver by the Holder of this Note shall be conclusive and binding
upon such Holder and upon all future Holders of this Note and of any Note issued
upon the registration of transfer hereof or in exchange herefor or in lieu
hereof, whether or not notation of such consent or waiver is made upon this
Note.

  As provided in and subject to the provisions of the Indenture, the Holder of
this Note shall not have the right to institute any proceeding with respect to
the Indenture or for the appointment of a receiver or trustee, or for any other
remedy thereunder, unless such Holder shall have previously given the Trustee
written notice of a continuing Event of Default with respect to the Notes, the
Holders of not less than 25 percent in principal amount of the Notes Outstanding
shall have made written request to the Trustee to institute proceedings in
respect of such Event of Default as Trustee and offered the Trustee reasonable
indemnity and the Trustee shall not have received from the Holders of a majority
in principal amount of the Notes Outstanding a direction inconsistent with such
request, and shall have failed to institute any such proceeding, for 60 days
after receipt of such notice, request and offer of indemnity. The foregoing
shall not apply to certain suits described in the Indenture, including any suit
instituted by the Holder of

                                       7
<PAGE>

this Note for the enforcement of any payment of principal hereof or any premium
or interest hereon on or after the respective due dates expressed herein.

  No reference herein to the Indenture and no provision of this Note or of the
Indenture shall alter or impair the obligation of the Company, which is absolute
and unconditional, to pay the principal of (and premium, if any) and interest,
if any, on this Note at the times, place and rate, in the coin or currency, and
in the manner, herein prescribed.

  The Notes are issuable only in registered form, without coupons, in
denominations of $1,000 and any integral multiple of $1,000, and in book-entry
form. The Notes may be represented by one or more global Notes deposited with
DTC and registered in the name of the nominee of DTC, with certain limited
exceptions. So long as DTC or any successor depository or its nominee is the
registered Holder of a global Note, DTC, such depository or such nominee, as the
case may be, will be considered to be the sole Holder of the Notes for all
purposes of the Indenture. Except as provided below, an owner of a beneficial
interest in a global Note will not be entitled to have Notes represented by such
global Note registered in such owner's name, will not receive or be entitled to
receive physical delivery of the Notes in certificated form and will not be
considered the owner or Holder thereof under the Indenture. Each person owning a
beneficial interest in a global Note must rely on DTC's procedures and, if such
person is not a participant, on the procedures of the participant through which
such person owns its interest, to exercise any rights of a Holder under the
Indenture. If the Company requests any action of Holders or if an owner of a
beneficial interest in a global Note desires to take any action that a Holder is
entitled to take under the Indenture, DTC will authorize the participants
holding the relevant beneficial interests to give or take such action, and such
participants will otherwise act upon the instructions of beneficial owners
holding through them.

   If at any time DTC notifies the Company that it is unwilling or unable to
continue as depository for the global Note or Notes or if at any time DTC ceases
to be a clearing agency registered under the Securities Exchange Act of 1934, as
amended, if so required by applicable law or regulation, the Company shall
appoint a successor depository with respect to such global Note or Notes. If (x)
a successor depository for such global Note or Notes is not appointed by the
Company within 90 days after the Company receives such notice or becomes aware
of such unwillingness, inability or ineligibility, (y) an Event of Default has
occurred and is continuing and the beneficial owners representing a majority in
principal amount of the Notes represented by such global Note or Notes advise
DTC to cease acting as depository for such global Note or Notes or (z) the
Company, in its sole discretion, determines at any time that all Outstanding
Notes (but not less than all) issued or issuable in the form of one or more
global Notes shall no longer be represented by such global Notes, then the
Company shall execute, and the Trustee shall authenticate and deliver,
definitive Notes of like series, rank, tenor and terms in definitive form in an
aggregate principal amount equal to the principal amount of such global Note or
Notes. If any beneficial owner of an interest in a permanent global Note is
otherwise entitled to exchange such interest for Notes of such series and of
like tenor and principal amount of another authorized form and denomination, as
contemplated by the Indenture and provided that any applicable notice provided
in the permanent global Note shall have been given, then without unnecessary
delay but in any event not later than the earliest date on which such interest
may be so exchanged, the Company shall execute, and the Trustee shall
authenticate and deliver, definitive Notes in aggregate principal amount equal
to the principal amount of such beneficial owner's interest in such permanent
global Note. On or after the earliest date on which such interests may be so
exchanged, such permanent global Note shall be surrendered for exchange by DTC
or such other depository as the Company shall specify to the Trustee; PROVIDED,
HOWEVER, that no such exchanges may occur during a period beginning at the
opening of business 15 days before any selection of Notes to be redeemed and
ending on the relevant Redemption Date if the Note for which exchange is
requested may be among those selected for redemption.

                                       8
<PAGE>

   Initially, the Trustee will be the Security Registrar and the Paying Agent
for this Note, and Kredietbank S.A. Luxembourgeoise will be the Luxembourg
Paying Agent and Transfer Agent. The Company reserves the rights at any time to
remove any Paying Agent, Transfer Agent or Security Registrar without notice, to
appoint additional or other Paying Agents, other Transfer Agents and other
Security Registrars without notice and to approve any change in the office
through which any Paying Agent, Transfer Agent or Security Registrar acts;
provided, however, that as long as the Notes are listed on the Luxembourg Stock
Exchange, the Company will maintain a Paying Agent and Transfer Agent in
Luxembourg, and any change in the Luxembourg Paying Agent and Transfer Agent
will be published in Luxembourg. None of the Company, the Trustee, any Paying
Agent or the Security Registrar will have any responsibility or liability for
any aspect of the records relating to or payments made on account of beneficial
ownership interests in this Note in global form or for maintaining, supervising
or reviewing any records relating to such beneficial ownership interests.
Notwithstanding the foregoing, nothing herein shall prevent the Company, the
Trustee, or any agent of the Company or the Trustee, from giving effect to any
written certification, proxy or other authorization furnished by any depository,
as a Holder, with respect to this Note in global form or impair, as between such
depository and owners of beneficial interests in such global Note, the operation
of customary practices governing the exercise of the rights of such depository
(or its nominee) as Holder of such global Note.

  THE INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS
OF LAW PRINCIPLES THEREOF.

  As used herein, "Business Day," when used with respect to any Place of Payment
or any other particular location referred to in this Note or in the Indenture,
means any day, other than a Saturday or Sunday, that is neither a legal holiday
nor a day on which banking institutions are authorized or required by law or
regulation to close in the City of New York or in the place of presentation.

  The Company may cause CUSIP or ISIN numbers to be printed on the Notes as a
convenience to Holders of Notes. No representation is made as to the accuracy of
such numbers as printed on the Notes, and reliance may be placed only on the
other identification numbers printed thereon.

  This Note shall not be entitled to any benefit under the Indenture or be valid
or obligatory until the Trustee or authenticating agent signs the certificate of
authenticity on the Notes.

  No recourse shall be had for the payment of the principal of (or premium, if
any) or interest, if any, or Additional Amounts, if any, on this Note, or any
part hereof, or for any claim based hereon or otherwise in respect hereof, or of
the indebtedness represented hereby, or upon any obligation, covenant or
agreement under the Indenture, against, and no personal liability whatsoever
shall attach to, or be incurred by, any incorporator, shareholder, officer or
director, as such, past, present or future, of (i) the Company or (ii) any
predecessor or successor corporation (either directly or through the Company or
a predecessor or successor corporation), whether by virtue of any constitutional
provision, statute or rule of law, or by the enforcement of any assessment or
penalty or otherwise; it being expressly agreed and understood that the
Indenture and all of the Notes are solely corporate obligations and that any
such personal liability is hereby expressly waived and released as a condition
of, and as part of the consideration for, the execution of the Indenture and the
issuance of the Notes.

                                       9

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