Document:

<PAGE>

                                   AMENDMENT
                                     TO THE
                         1997 EQUITY PARTICIPATION PLAN
                                       OF
                              GUITAR CENTER, INC.

    Pursuant to the authority reserved to the Board of Directors (the "Board")
of Guitar Center, Inc., a corporation organized under the laws of State of
Delaware (the "Company"), under Section 10.2 of the 1997 Equity Participation
Plan of Guitar Center, Inc. (the "Plan"), the Board hereby amends the Plan as
follows.

    1.  The definition of "Award Limit" is amended to read in its entirety as
follows:

    "'Award Limit"' shall mean 250,000 shares of Common Stock.

    2.  The first sentence of the definition of "Option" is amended to read in
its entirety as follows:

    "'Option' shall mean a stock option granted under Article III or
    Article IIIA of this Plan."

    3.  The second sentence of Section 2.1(a) of the Plan is amended to read in
its entirety as follows: "The aggregate number of such shares which may be
issued upon exercise of such options or rights or upon any such awards under the
Plan shall not exceed two million, seven hundred twenty-five thousand
(2,725,000)."

    4.  Section 3.4(b) of the Plan is amended to read in its entirety as
follows:

    "(b) Upon the selection of a key Employee, consultant or Independent
    Director to be granted an Option, the Committee (or the Board, with respect
    to an Option granted to an Independent Director) shall instruct the
    Secretary of the Company to issue the Option and may impose such conditions
    on the grant of the Option as it deems appropriate. Without limiting the
    generality of the preceding sentence, (x) the Board may, in its discretion
    and on such terms as it deems appropriate, provide that an Option granted to
    any Independent Director shall be in addition or in lieu of an Option that
    may be or has been granted to such Independent Director pursuant to Section
    3.4(d) or Article IIIA hereof, or (y) the Committee (or the Board, with
    respect to an Option granted to an Independent Director) may, in its
    discretion and on such terms as it deems appropriate, require as a condition
    on the grant of an Option to an Employee, consultant or Independent Director
    that the Employee, consultant or Independent Director surrender for
    cancellation some or all of the unexercised Options, awards of Restricted
    Stock or Deferred Stock, Performance Awards, Stock Appreciation Rights,
    Dividend Equivalents or Stock Payments or other rights which have been
    previously granted to him under this Plan or otherwise. An Option, the grant
    of which is conditioned upon such surrender, may have an option price equal
    to, higher or lower than the exercise price of such surrendered Option or
    other award, may cover the same (or a lesser or greater) number of shares as
    such surrendered Option or other award, may contain such other terms as the
    Committee (or the Board, with respect to an Option granted to an Independent
    Director) deems appropriate, and shall be exercisable in accordance with its
    terms, without regard to the number of shares, exercise period or any other
    term or condition of such surrendered Option or other award."

    5.  The second sentence of Section 3.1 is hereby amended to read in its
entirety as follows:

    "Each Independent Director of the Company shall be eligible to be granted
    Options at the times and in the manner set forth in Section 3.4(a)(i),
    3.4(d) or Article IIIA."

                                      1
<PAGE>
    6.  Article IIIA is hereby added to the Plan to read in its entirety as
follows:

                                 "ARTICLE IIIA
                      INDEPENDENT DIRECTOR OPTION PROGRAM

    3.1A  GRANTING OF ADDITIONAL OPTIONS.

    (a) In addition to those Options referenced in Section 3.4(d), during each
12-month (or shorter) period commencing on the date of the Company's annual
stockholders' meeting (each, a "Plan Year") in which a person is an Independent
Director and is entitled to receive the Retainer (as defined below) during the
term of the Plan, each such Independent Director may elect to receive all or any
portion of his or her Retainer either (i) in cash or (ii) in the form of an
Option (an "Additional Option"), with the exercise price of such Option to be as
set forth in Section 3.2A, below (the "Election"). The number of shares of
Common Stock subject to such Additional Option shall be equal to a fraction
(rounded to the nearest whole number), with the numerator of such fraction equal
to the Retainer and denominator of such fraction equal to the product of
(i) fifteen one-hundredths (0.15) and (ii) the Fair Market Value of a share of
Common Stock as of the date of grant of such Additional Option. Each Additional
Option shall be granted in one or more installments on the same date(s) on which
all or any portion of the Retainer would otherwise have been paid if it were
paid in cash (with such date referred to as the "date of grant"). For purposes
of this Plan, "Retainer" shall mean the amount of compensation (including,
without limitation, annual Director fees, committee fees and meeting fees) set
by the Board from time to time as payable to a Director in each Plan Year.

    (b) The Election described in Section 3.1A(a) must be made by written notice
provided by the Independent Director to the Committee no later than the last day
of the Plan Year immediately preceding the Plan Year with respect to which such
Election is intended to be effective; PROVIDED, HOWEVER, that no Election shall
be effective with respect to any portion of the Retainer attributable to
services rendered prior to the date of filing of such Election. An Election
shall be irrevocable with respect to the Plan Year for which it is made, and
shall remain in effect for a subsequent Plan Year unless revoked by written
notice provided by the Independent Director to the Committee prior to the first
day of such subsequent Plan Year.

    3.2A  ADDITIONAL OPTION TERMS.  Notwithstanding anything in Article IV to
the contrary, with respect to any Additional Option granted pursuant to Section
3.1A, the exercise price of each share of Common Stock subject to such
Additional Option shall be equal to the product of (i) the Fair Market Value of
a share of Common Stock subject to such Additional Option (determined as of the
date of grant of such Additional Option) and (ii) eighty-five one-hundredths
(0.85); the term of such Additional Option shall be ten (10) years from the date
the Additional Option is granted, except as may be amended by the Committee in
its discretion; and such Additional Option shall be fully exercisable as of the
date the Additional Option is granted.

    7.  This Amendment shall be submitted for approval at the annual meeting of
stockholders of the Company scheduled to be held on May 2, 2000, or any
postponement or adjournment thereof. The provisions of this Amendment shall be
presented to the stockholders severally in such format as shall be approved by
the Secretary of the Corporation and may be considered and approved or
disapproved by the stockholders independently in the format approved by the
Secretary, except that paragraph 6 relating to the "Independent Director Option
Plan" shall not be deemed approved unless the increase in authorized shares
contemplated by paragraph 3 is approved.

                              * * * * * * * * * *

                                       2<PAGE>

                                                                   Exhibit 10.18

          Confidential Materials omitted and filed separately with the
         Securities and Exchange Commission. Asterisks denote omissions.

               DISTRIBUTION AND MARKETING COLLABORATION AGREEMENT

                                     between

                                   FOCAL, INC.

                                       and

                               GENZYME CORPORATION

                                October 21, 1999
<PAGE>

                                TABLE OF CONTENTS
<TABLE>
<CAPTION>

                                                                                                          PAGE

<S>           <C>     <C>                                                                                  <C>
ARTICLE 1       DEFINITIONS.................................................................................1

ARTICLE 2       COLLABORATION COMMITTEE.....................................................................8
        2.1     COLLABORATION COMMITTEE.....................................................................8
        2.2     MEETINGS....................................................................................8
        2.3     SPECIFIC RESPONSIBILITIES OF THE COLLABORATION
                COMMITTEE...................................................................................9
        2.4     QUORUM; VOTING..............................................................................9

ARTICLE 3       DISTRIBUTION...............................................................................10
        3.1     APPOINTMENT OF GENZYME AS EXCLUSIVE DISTRIBUTOR............................................10
        3.2     LICENSE TO USE TRADEMARKS..................................................................11
        3.3     ACCEPTANCE OF APPOINTMENT..................................................................11
        3.4     FOCAL RETAINED RIGHTS......................................................................11
        3.5     NO SALES OUTSIDE THE TERRITORY.............................................................12

ARTICLE 4       PROMOTION AND SALE.........................................................................12
        4.1     SALES AND PROMOTIONAL EFFORTS AND PERSONNEL................................................12
        4.2     ANNUAL SALES PLANS, SALES REPORTS AND ANNUAL
                SALES FORECASTS............................................................................13
        4.3     INTERNAL AND EXTERNAL TRAINING.............................................................14
        4.4     ADVERTISING AND PROMOTIONAL MATERIALS......................................................15
        4.5     SYSTEM PACKAGING...........................................................................16
        4.6     MEDICAL CONFERENCES........................................................................17
        4.7     MEDICAL INQUIRIES..........................................................................17
        4.8     SALES ADMINISTRATION.......................................................................17
        4.9     PROMOTION AND MARKETING EXPENSES...........................................................17

ARTICLE 5       PRODUCT RESEARCH AND DEVELOPMENT, MANUFACTURING
                AND SERVICING..............................................................................18
        5.1     COLLABORATION COMMITTEE ROLE...............................................................18
        5.2     RESEARCH AND DEVELOPMENT...................................................................18
        5.3     MANUFACTURING..............................................................................18
        5.4     SUPPLY SHORTAGES...........................................................................18
        5.5     PASS-THROUGH WARRANTY AND SERVICE FOR REUSABLE
                PRODUCTS...................................................................................21
        5.6     GENERAL COMMERCIALIZATION ACTIVITIES.......................................................21
        5.7     RESPONSIBILITIES OF GENZYME................................................................22

ARTICLE 6       PRODUCT SUPPLY, FORECASTS, PURCHASE PRICE AND
                SHIPMENT...................................................................................22
        6.1     SUPPLY OF THE PRODUCTS.....................................................................22

                                       i
<PAGE>

        6.2     DEMONSTRATION SYSTEMS......................................................................22
        6.3     ANNUAL SALES FORECASTS.....................................................................23
        6.4     PURCHASE MINIMUMS..........................................................................24
        6.5     PURCHASE ORDERS AND PROCEDURES.............................................................25
        6.6     PURCHASE PRICE.............................................................................25
        6.7     PAYMENT TERMS..............................................................................27
        6.8     FOCAL SHIPMENT.............................................................................28
        6.9     TITLE TO THE PRODUCTS......................................................................28
        6.10    TAXES......................................................................................28
        6.11    PRODUCT WARRANTY...........................................................................29
        6.12    QUALITY ASSURANCE; NONCONFORMING PRODUCTS..................................................30
        6.13    SPECIFICATIONS AND SYSTEM EXPIRATION.......................................................30
        6.14    RESALE PRICING.............................................................................31

ARTICLE 7       REGULATORY MATTERS.........................................................................31
        7.1     SYSTEM AND DISTRIBUTION APPROVALS..........................................................31
        7.2     POST MARKETING STUDIES.....................................................................31
        7.3     COMMUNICATION WITH REGULATORY AUTHORITIES..................................................31
        7.4     GOVERNMENTAL INSPECTIONS...................................................................32
        7.5     SYSTEM COMPLAINTS..........................................................................32
        7.6     POST MARKETING SURVEILLANCE................................................................32
        7.7     SYSTEM RECALLS.............................................................................32

ARTICLE 8       OWNERSHIP, CONFIDENTIALITY AND PUBLIC INFORMATION..........................................33
        8.1     OWNERSHIP..................................................................................33
        8.2     USE OF NON-CLINICAL AND CLINICAL DATA......................................................33
        8.3     CONFIDENTIALITY............................................................................33
        8.4     COVENANT NOT TO COMPETE....................................................................33
        8.5     PUBLIC DISCLOSURES.........................................................................34
        8.6     PUBLICATIONS...............................................................................34
        8.7     OTHER PARTIES..............................................................................34

ARTICLE 9       TRADEMARKS.................................................................................35
        9.1     TRADEMARK REGISTRATION.....................................................................35
        9.2     NO RIGHTS IN TRADEMARKS, TRADE NAMES, LOGOS OR
                DESIGNATIONS...............................................................................35
        9.3     TRADEMARKS AFTER TERMINATION OR EXPIRATION.................................................35

ARTICLE 10      PATENT AND TRADEMARK INDEMNIFICATION AND
                LITIGATION.................................................................................36
        10.1    PATENT AND TRADEMARK INDEMNITY.............................................................36
        10.2    LIMITATION OF INDEMNITY....................................................................36
        10.3    INFRINGEMENT BY THIRD PARTIES..............................................................37
        10.4    THIRD PARTY LICENSE AGREEMENTS.............................................................37

ARTICLE 11      TERM AND TERMINATION.......................................................................38
        11.1    INITIAL TERM...............................................................................38

                                       ii
<PAGE>

        11.2    EXTENSION TERM.............................................................................38
        11.3    TERMINATION BY EITHER PARTY................................................................38
        11.4    TERMINATION BY GENZYME.....................................................................39
        11.5    TERMINATION BY FOCAL.......................................................................39
        11.6    TERMINATION BY FOCAL AND GENZYME...........................................................40

ARTICLE 12      ARIGHTS AND DUTIES UPON TERMINATION OR EXPIRATION..........................................40
        12.1    MONIES PAID OR DUE.........................................................................40
        12.2    TERMINATION OF DISTRIBUTION RIGHTS.........................................................40
        12.3    REMAINING SYSTEMS..........................................................................40
        12.4    TRANSFER OF APPROVALS AND TRANSITION ASSISTANCE............................................40
        12.5    SURVIVAL OF RIGHTS.........................................................................41
        12.6    RIGHTS NOT EXCLUSIVE.......................................................................41

ARTICLE 13      REPRESENTATIONS AND WARRANTIES; COVENANTS..................................................41
        13.1    AUTHORIZATION..............................................................................41
        13.2    INTELLECTUAL PROPERTY RIGHTS...............................................................42
        13.3    COMPLIANCE WITH APPLICABLE LAWS............................................................42

ARTICLE 14      INDEMNIFICATION, LIMITATION OF LIABILITY AND
                INSURANCE..................................................................................42
        14.1    INDEMNIFICATION BY GENZYME.................................................................42
        14.2    INDEMNIFICATION BY FOCAL...................................................................42
        14.3    CONDITIONS TO INDEMNIFICATION..............................................................42
        14.4    SETTLEMENTS................................................................................43
        14.5    LIMITATION OF LIABILITY....................................................................43
        14.6    INSURANCE..................................................................................43

ARTICLE 15      IMPROVEMENT PRODUCTS.......................................................................44
        15.1    IMPROVEMENT PRODUCTS.......................................................................44

ARTICLE 16      MISCELLANEOUS..............................................................................44
        16.1    FORCE MAJEURE; OTHER EVENTS................................................................44
        16.2    GOVERNING LAW..............................................................................45
        16.3    GOVERNMENTAL APPROVALS AND MODIFICATION BY
                LEGISLATION................................................................................45
        16.4    INJUNCTIVE RELIEF..........................................................................45
        16.5    DISPUTE RESOLUTION.........................................................................45
        16.6    SEVERABILITY AND CLAIMS....................................................................46
        16.7    ENTIRE AGREEMENT...........................................................................46
        16.8    AMENDMENT..................................................................................47
        16.9    NOTICES....................................................................................47
        16.10   BINDING EFFECT AND ASSIGNMENT..............................................................48
        16.11   HEADINGS AND REFERENCES....................................................................48
        16.12   NO AGENCY..................................................................................48
        16.13   COUNTERPARTS...............................................................................48
</TABLE>

                                      iii
<PAGE>

               DISTRIBUTION AND MARKETING COLLABORATION AGREEMENT

         Distribution and Marketing Collaboration Agreement (this "Agreement")
made this 21st day of October, 1999, between Focal, Inc., a Delaware corporation
("Focal"), and Genzyme Corporation, a Massachusetts corporation ("Genzyme").

         WHEREAS, Focal develops, manufactures and markets synthetic,
absorbable, liquid surgical wound-closure sealants based on Focal's proprietary
polymer technology, including without limitation the FocalSeal(R)-L and
FocalSeal(R)-S products;

         WHEREAS, Genzyme Surgical Products ("GSP"), a tracking stock division
of Genzyme Corporation, is a leading medical products company with experience
and skills in promoting, marketing and selling products for use within the Field
(as hereafter defined), including biomaterials similar to the products
developed, manufactured and marketed by Focal;

         WHEREAS, Genzyme, acting through GSP, desires to market, sell and
distribute the Systems in the Territory for use in the Field following the
issuance of applicable Regulatory Approvals (each hereafter defined); and

         WHEREAS, Focal and Genzyme are prepared to enter into a distribution
and marketing collaboration agreement on the terms and conditions set forth
below.

         NOW, THEREFORE, in consideration of the covenants and obligations
expressed herein, and intending to be legally bound, the parties agree as
follows:

                                    ARTICLE 1

                                   DEFINITIONS

         1.1 "Affiliate" shall mean any corporation, limited liability company,
firm, partnership or other entity, whether de jure or de facto, which, at the
time in question, is directly or indirectly owned by or controlled by, or under
common control with, Focal or Genzyme, as the case may be. For the purposes of
this definition, a party shall be deemed to have "control" if such party (a)
owns, directly or indirectly, 50% or more of (i) the voting stock or
shareholders' equity of a corporation, (ii) the partnership interests in a
partnership, (iii) the membership interests in a limited liability company, or
(iv) in the case of any other entity, the right to receive 50% or more of either
the profits or the assets upon dissolution, or (b) possesses, directly or
indirectly, the power to direct or cause the direction of the management and
policies of the corporation or other entity or the power to elect more than 50%
of the members of the governing body of the corporation, limited liability
company or other entity.

         1.2 "Annual Sales Plan" shall have the meaning ascribed to it in
Section 4.2(a) of this Agreement.

         1.3 "Annual Sales Report" shall have the meaning ascribed to it in
Section 4.2(f) of this Agreement.
<PAGE>

         1.4 "Annual Sales Forecast" shall have the meaning ascribed to it in
Section 6.3(a) of this Agreement.

         1.5 "Applicators" shall mean the devices, other than Light Sources,
Light Wands and Lamp Modules, heretofore or hereafter used or developed for the
delivery of the Sealants and the Primers in the Field, including but not limited
to, syringes, syringe extensions, flow through brushes, plungers and other
components.

         1.6 "Average Net Sales Price" shall mean, with respect to sales of each
Product in a given country in the Territory during any applicable period, (i)
the aggregate gross invoice price for each Product actually sold by Genzyme to
Third Parties less, to the extent actually incurred, charged or credited to the
Third Party and identified on the invoice or other documentation related to the
sale, (ii) the sum of (a) trade or cash discounts, quantity discounts, rebates
and other price reductions, (b) Product returns; provided, that no charge may be
taken for the return by Third Parties of Obsolete Products without the approval
of the Collaboration Committee, (c) bad debt write-offs, (d) packaging, shipping
and other delivery charges (excluding any such charges included in Manufacturing
Costs), (e) sales, value added, excise and other direct taxes, and (f) any
losses or charges related to foreign currency exchange for Products purchased by
Genzyme from Focal in Dollars and sold by Genzyme in a foreign currency, and the
resulting difference between (i) and (ii) divided by (iii) the number of units
of the relevant Product sold during the period. Average Net Sales Price shall be
determined on a Product-by-Product basis and country-by-country basis. Average
Net Sales Price shall be calculated in Dollars and if any payments are made to
Genzyme by a Third Party in foreign currency, such payments shall be converted
to Dollars at the rate and pursuant to the procedures determined by the
Collaboration Committee.

         Average Net Sales Price shall not include sales between Genzyme and any
of its Affiliates intended for resale; in such cases, the resale by such
Affiliate shall be the sale included in the calculation of Average Net Sales
Price. If the sale of any Product is associated, by contract or course of
dealing, with the use or sale of one or more other products or services (a
"Multiple Products Sale"), the Average Net Sales Price shall be calculated by
the Collaboration Committee based upon a recommendation from Genzyme to the
Collaboration Committee, and shall equal a fair and equitable allocation of all
consideration received in connection with a Multiple Products Sale, considering
the nature and economic value of each Product in the Multiple Products Sale, but
the Average Net Sales Price shall not be less than the Average Net Sales Price
for the Product sold alone (in similar quantities) during the calendar quarter
during which such Multiple Product Sale occurs, and shall be subject to review
and approval by the Collaboration Committee. Notwithstanding the foregoing,
during the period commencing on the launch date of a System in a country within
the Territory and ending on the last day of the first full calendar quarter
following immediately thereafter, the Average Net Sales Price per unit shall
equal Genzyme's estimate of the Average Net Sales Price.

         1.7 "Collaboration Committee" shall have the meaning ascribed to it in
Section 2.1 of this Agreement.

         1.8 "Commercial Know-How" shall mean all commercial trade secret
information relating to commercialization of the Systems, and shall include
without limitation, customer lists, Annual Sales Plans, surveys, sales call
lists, market research, customer information, service information, marketing
strategy, training materials, sales and marketing materials prepared by or on
behalf of each party, and

                                       2
<PAGE>

such other information in the possession of each party or its agents relating to
advertising, marketing, promotion or commercial sale of the Systems.

         1.9 "Dollars" or "$" shall mean United States dollars.

         1.10 "Effective Date" shall mean the date as of which this Agreement is
effective and shall be the date of this Agreement as first written above.

         1.11 "Extension Term" shall mean the period or periods, if any, during
which the Initial Term is extended in accordance with Section 11.2 of this
Agreement.

         1.12 "FDA" shall mean the United States Food and Drug Administration,
and any successor agency with responsibilities comparable to the United States
Food and Drug Administration.

         1.13 "Field" shall mean all surgical sealing performed during
pulmonary, cardiovascular (including peripheral vascular), or gastrointestinal
human surgical procedures (including open procedures and minimally invasive
procedures, such as catheter based procedures) of air and fluid (including
without limitation blood) leaks.

         1.14 "Focal" shall mean Focal, Inc. and its Affiliates.

         1.15 "Focal Indemnified Party" shall have the meaning ascribed to it in
Section 14.1 of this Agreement.

         1.16 "Focal Patent Rights" shall mean all Patent Rights which are owned
or controlled by, in whole or in part, or licensed (with a right to sublicense)
to, Focal, and in which now or hereafter Focal has the right to grant licenses
or sublicenses, which generically or specifically claim (i) any Product or
System, (ii) the process for manufacturing any Product or System, (iii)
intermediates used in such manufacturing process for any Product or System, (iv)
methods to formulate or deliver any Product or System, (v) use of any Product or
System, or (vi) intermediates or any manufacturing process required or useful
for the production of any Products or System.

         1.17 "Genzyme" shall mean Genzyme Corporation and its Affiliates.

         1.18 "Genzyme Indemnified Party" shall have the meaning ascribed to it
in Section 14.2 of this Agreement.

         1.19 "GSP" shall mean Genzyme Surgical Products, a tracking stock
division of Genzyme Corporation.

         1.20 "Improvement Product" shall mean any modification or variation of
a Product for use in the Field that is conceived or developed for any of the
following purposes or has any of the following consequences: (i) improves the
Product's overall performance; (ii) reduces the Product's cost of materials,
parts, production or manufacture; (iii) increases the Product's durability or
continuous performance characteristics; (iv) increases or enhances the Product's
marketability or commercial acceptance; (v) replaces or displaces the Product in
any commercial market; or (vi) any modification or variations of a Product that
competes or has the potential to compete with the related Product in the Field.

                                       3
<PAGE>

         1.21 "Initial Term" shall have the meaning ascribed to it in Section
11.1 of this Agreement.

         1.22 "Launch Plan" shall have the meaning ascribed to it in Section
4.2(a) of this Agreement.

         1.23 "Liability" shall have the meaning ascribed to it in Section 14.1
of this Agreement.

         1.24 "Lamp Modules" shall mean the device for use in the Field which is
described on EXHIBIT A to this Agreement and which is intended for insertion
into the Light Source.

         1.25 "Light Sources" shall mean the device for use in the Field
described on EXHIBIT A to this Agreement and which is intended to be the source
of light emission by the Light Wand.

         1.26 "Light Wands" shall mean the device for use in the Field described
on EXHIBIT A to this Agreement and which is intended to emit the light generated
by the Light Source for the purpose of illuminating the Sealant and completing
the sealing process.

         1.27 "MAA" shall mean a marketing authorization application filed with
the Regulatory Authority of a country within the Territory submitted to obtain
Regulatory Approval, including without limitation, a "Premarket Approval
Application" filed with the FDA.

         1.28 "Manufacturing Costs" shall mean the variable costs and fixed
costs incurred by Focal (or in the case of Section 5.4 of this Agreement, by
Genzyme) in manufacturing a Product and/or securing such Product from Third
Party suppliers. For purposes of this definition, "variable costs" shall include
the cost of labor directly involved in the production of a Product, raw
materials, supplies and other resources directly consumed in the manufacture,
manufacturing engineering, materials management, quality assurance, quality
control, packaging, labeling, storage, warehousing and shipping of a Product.
For purposes of this definition, "fixed costs" shall be deemed to include that
portion of the cost of manufacturing-associated labor, facilities, utilities,
insurance, equipment depreciation and other fixed costs directly related to the
manufacture, quality assurance, quality control, packaging, labeling, storage,
warehousing and shipping of a Product, allocated based upon the proportion of
such costs directly attributable to the support or performance of the applicable
activities or such other method of cost allocation as may be approved by the
Collaboration Committee. For purposes of this definition,
"manufacturing-associated labor" shall mean those persons directly providing
services as part of the Product manufacturing process within the functional
areas identified in the preceding sentence, and shall not include persons
indirectly supporting the manufacturing process, including without limitation,
persons working in the general management, finance, corporate development,
legal, human resources, accounting, marketing, sales and customer service, and
other similar areas.

         1.29 "Manufacturing Know-How" shall mean all information, techniques,
inventions, discoveries, improvements, practices, methods, knowledge, skill,
experience and other technology, whether or not patentable or copyrightable, and
any copyrights based thereon, owned or controlled by Focal, or licensed to Focal
(with a right to sublicense) relating to or necessary or useful for the
production, purification, packaging, storage and transportation of Products or
Systems, including without limitation specifications, acceptance criteria,
manufacturing batch records, standard operating procedures, engineering plans,
installation, operation and process qualification protocols for equipment,
validation records, master files submitted to Regulatory Authorities, process
validation reports, environmental monitoring processes, test data (including
pharmacological, toxicological and clinical test data), cost data and employee
training materials.

                                       4
<PAGE>

         1.30 "Manufacturing License" shall have the meaning ascribed to it in
Section 5.4(f) of this Agreement.

         1.31 "Monthly Sales Reports" shall have the meaning ascribed to it in
Section 4.2(c) of this Agreement.

         1.32 "Notified Party" shall have the meaning ascribed to it in Section
7.5 of this Agreement.

         1.33 "Notifying Party" shall have the meaning ascribed to it in Section
7.5 of this Agreement.

         1.34 "Obsolete Product" shall mean any Product that, at the time of
return or proposed return by a customer, has a remaining shelf life that is less
than 25% of the original shelf life of the Product as marked on the Product, or
otherwise stated on the label or accompanying packaging.

         1.35 "Patent Rights" shall mean all United States and foreign patents
and patent applications, and all continuations, continuations-in-part,
divisions, reissues, reexaminations, renewals or extensions thereof.

         1.36 "Post Marketing Surveillance" or "PMS" shall have the meaning
ascribed to it in Section 7.6 of this Agreement.

         1.37 "Primer" shall mean the synthetic, absorbable, surgical
biomaterial for use in the Field described in EXHIBIT A to this Agreement
heretofore or hereafter developed, manufactured and sold by Focal and which is
intended for use in conjunction with the Sealant as part of the sealing process.

         1.38 "Product" shall mean each of the following: (a) Applicators, Light
Sources, Lamp Modules, Light Wands, Primers and Sealants, (b) any other
biomaterial, device or instrument for use in the Field which is determined by
the Collaboration Committee to be a Product and to be subject to the terms of
this Agreement, and (c) any Improvement Products.

         1.39 "Promotional Materials Expenses" shall mean the out-of-pocket
expenditures paid by Focal and Genzyme to Third Parties for marketing and
promotional materials for a System in accordance with the Launch Plans and
Annual Sales Plans, but excluding training and educational materials utilized by
Focal in performing its training obligations under this Agreement.

         1.40 "Proprietary Information" shall mean all information, including
without limitation, proprietary information and materials (whether or not
patentable) regarding a party's technology, products, business information or
objectives, which is designated as confidential in writing by the disclosing
party, whether by letter or by the use of an appropriate stamp or legend, prior
to or at the time any such information is disclosed by the disclosing party to
the other party. Notwithstanding the foregoing, (a) all Focal Patent Rights and
Technology shall constitute Proprietary Information, (b) all tracings and other
information identifying persons or institutions to whom Genzyme sells Products
or Systems shall constitute Proprietary Information; and (c) information which
is orally, electronically or visually disclosed by a party, or is disclosed in
writing without an appropriate letter, stamp or legend, shall constitute
Proprietary Information of a party (i) if the disclosing party, within thirty
(30) days after such disclosure, delivers to the other party a written document
or documents describing the information and referencing the place and date of
such oral, visual, electronic or written disclosure and the names of the persons
to whom such disclosure was made, or (ii) such information is of the type that
is customarily

                                       5
<PAGE>

considered to be confidential information by persons engaged in activities that
are substantially similar to the activities being engaged in by the parties
pursuant to this Agreement.

         1.41 "Purchase Price" shall have the meaning ascribed to it in Section
6.6(a) of this Agreement.

         1.42 "Purchase Minimums" shall mean the Tier I Purchase Minimums and
Tier II Purchase Minimums, individually or together.

         1.43 "Quality Systems Regulations" or "QSR" shall mean the FDA's
Quality Systems Regulations, as promulgated under the United States Food, Drug
and Cosmetic Act, as amended, and in effect during the term of this Agreement.

         1.44 "Regulatory Approval" shall mean, with respect to each country of
the Territory and for a particular System, the final approval granted by a
Regulatory Authority that is required lawfully, or is deemed by the
Collaboration Committee to be necessary, to commercially sell a System for use
in the Field within such country. Regulatory Approval shall not include pricing
or reimbursement approval.

         1.45 "Regulatory Authority" shall mean, with respect to each country of
the Territory, the medical regulatory authority that is the functional
counterpart to the FDA and shall have the authority and jurisdiction to provide
Regulatory Approval for the Systems.

         1.46 "Research and Development" shall mean scientific studies,
pre-clinical, clinical and post-clinical research and development, including
without limitation any post Regulatory Approval studies required as a condition
to such Regulatory Approval, and other regulatory activities conducted in the
Field and in the Territory and relating to the Products or Systems.

         1.47 "Scientific Know-How" shall mean all information and expertise
known by Focal that relates to the Products or Systems, and shall include
without limitation all chemical, pharmacological, toxicological, clinical,
pharmacoeconomic data, assay, quality control and manufacturing data and any
other scientific information and reagents relating to the Systems and useful or
required for the Research and Development of the Systems that is known as of the
Effective Date of this Agreement or developed after the date of this Agreement
by Focal, and any item of scientific knowledge which is otherwise necessary or
useful to make, use or sell the Systems.

         1.48 "Sealant" shall mean the synthetic, absorbable, surgical
wound-closure sealant based upon and incorporating a hydrogel polymer in
membrane, liquid, gel or other form heretofore or hereafter developed,
manufactured and sold by Focal for use in the Field, currently known as the
FocalSeal -Registered Trademark- -L and FocalSeal -Registered Trademark- -S
Systems, as described more fully ON EXHIBit A.

         1.49 "Specifications" shall mean, with respect to any System, the
specifications for the Product or System approved by any Regulatory Authority as
part of the Regulatory Approval for the Product or System, as such
specifications may be modified or supplemented from time to time to reflect
modifications to such Regulatory Approvals. Such Specifications, and any
modifications or supplements thereto, shall become a part of this Agreement and
shall be attached as an exhibit hereof.

                                       6
<PAGE>

         1.50 "System" shall mean any single Product, or combination of
Products, including packaging and package inserts, sold by Genzyme to Third
Parties as a single product and as approved by the Collaboration Committee.

         1.51 "System Launch" shall mean the manufacturing, promotional,
training, marketing and sales activities conducted prior to and following
Regulatory Approval of a System in any country in the Territory in conjunction
with the initial commercial introduction of such System.

         1.52 "Technology" shall mean Manufacturing Know-How, Scientific
Know-How, Commercial Know-How and all other inventions, trade secrets,
copyrights, know-how, data and other intellectual property of any kind which is
necessary or useful to make, use or sell the Products or Systems, but not
including Focal Patent Rights.

         1.53 "Territory" shall mean, collectively, the countries of the United
States of America (including its territories and possessions), Canada and
Mexico.

         1.54 "Third Party" shall mean any person other than a party (including
its Affiliates) to this Agreement.

         1.55 "Tier I Purchase Minimums" and "Tier II Purchase Minimums" shall
have the meanings ascribed to each term in Section 6.4(a) and 6.4(b),
respectively, of this Agreement.

         1.56 "Trademark" means a trademark, including Focal -Registered
Trademark- and FocalSeal -Registered Trademark-, and any variation or
substitute mark thereof, proposed by Focal for use with the Systems in the
Territory, whether such mark is proposed, pending, allowed or registered;
provided, however, that using such variation or substitute mark shall be
subject to Genzyme's approval, which approval shall not be unreasonably
withheld. Notwithstanding the foregoing, "Trademarks" shall not under any
circumstances include trademarks of Genzyme used with the Systems in the
Territory.

         1.57 ADDITIONAL DEFINITIONS. Each of the following definitions is set
forth in the section of this Agreement indicated below:

<TABLE>
<CAPTION>
              DEFINITION                                  SECTION
              ----------                                  -------
              <S>                                         <C>
              "ADR"                                       16.5(c)
              "Agreement"                                 Preamble
              "Assumed Obligation"                        3.1(b)
              "Claim"                                     16.6(c)
              "Cure Quarter"                              5.4(d)
              "Election Notice"                           5.4(d)
              "Performance Suspension Event"              16.1(b)
              "Genzyme Royalty"                           5.4(g)
              "Plans"                                     4.2(a)

                                       7
<PAGE>

              "Provisional Payment"                       6.7(c)
              "Reduced Genzyme Royalty"                   5.4(h)(ii)
              "Reusable Products"                         5.5(a)
              "SOP"                                       7.7
              "Shortfall Products"                        5.4(c)
              "Shortfall Units"                           5.4(c)
              "Stock Purchase Agreement"                  11.5(a)
              "Suspension Request"                        16.1(b)
              "Third Party License Agreements"            10.4(a)
              "Transitional Costs"                        5.4(h)(i)
</TABLE>

                                   ARTICLE 2

                             COLLABORATION COMMITTEE

         2.1 COLLABORATION COMMITTEE. Promptly after the Effective Date, the
parties shall establish a committee with the duties and responsibilities set
forth in this Agreement that shall be comprised of personnel from Focal and
Genzyme (the "Collaboration Committee"). The Collaboration Committee shall
include four (4) voting members, two (2) of whom shall be appointed by Genzyme
and two (2) of whom shall be appointed by Focal. Each party shall make its
designation of its initial representatives not later than fifteen (15) days
after the Effective Date. Each party shall use reasonable efforts to designate
as its representatives, individuals that shall have the requisite experience and
knowledge to oversee the commercialization activities contemplated by this
Agreement. Vacancies on the Collaboration Committee shall be filled within ten
(10) days after the date such vacancy occurs. In addition, each party may
designate any number of additional persons to serve as advisors to the
Collaboration Committee. Each party shall designate its members to the
Collaboration Committee, and shall notify the other party in writing each time
it permanently replaces and appoints a new designated member. If a member of the
Collaboration Committee is unable to attend a meeting, the party that appointed
such member may designate a substitute to participate in lieu of the absent
member. One member of the Collaboration Committee shall be elected by the
Collaboration Committee to serve as its Chairman for any term approved by the
Collaboration Committee. The Chairman shall preside at all meetings of the
Collaboration Committee, shall prepare the agenda for each meeting, shall cause
minutes of each meeting to be taken and shall maintain the records of the
Collaboration Committee. There shall be no limit on the number of alternate or
successive terms that a member may serve as Chairman.

         2.2 MEETINGS. The Collaboration Committee shall meet periodically at
such times and places as it may select but, in any event, it shall meet (i)
within thirty (30) days after the Effective Date, and (ii) at least once each
quarter during each calendar year. If the Collaboration Committee does not
determine to meet elsewhere, its meetings shall alternate locations between the
offices of Focal in Lexington, MA and Genzyme in Cambridge, MA, with the first
meeting to be held at Focal's offices. The Collaboration

                                       8
<PAGE>

Committee may meet in person or by video- or tele- conferencing, and individual
members may participate in any of the foregoing ways. All costs of participation
by each member in the activities of the Collaboration Committee shall be borne
by the party appointing such member.

         2.3 SPECIFIC RESPONSIBILITIES OF THE COLLABORATION COMMITTEE. The
Collaboration Committee shall coordinate matters relating to the
commercialization of the Products and the activities of Focal and Genzyme in the
Territory, and in connection therewith the Collaboration Committee shall be
responsible for:

             (a) developing and approving an overall strategy for the marketing,
promotion and sale of the Systems in the Territory;

             (b) reviewing and approving the Launch Plans and Annual Sales Plans
submitted by Focal and Genzyme, approving the number of units of Products to be
furnished by Focal to Genzyme for demonstration purposes in connection with the
launch of a System and each year thereafter, and approving the plans for
representation of the Systems at major surgical conferences and meetings in the
Territory;

             (c) providing advice to Focal on its Research and Development
activities and its manufacturing activities,

             (d) reviewing and approving the methods of calculating
Manufacturing Costs and Average Net Sales Price, and based on such calculations
establishing the Purchase Price for the Products;

             (e) reviewing and approving Genzyme's calculation of the Genzyme
Royalty, the Reduced Genzyme Royalty and Transitional Costs (each as defined in
Section 5.4(g) or (h) of this Agreement);

             (f) reviewing and approving the Annual Sales Forecasts and the
Annual Purchase Minimums for each Product;

             (g) developing and approving procedures for the coordination of
activities among the parties to achieve efficient regulatory compliance
practices with respect to the Systems in the Territory;

             (h) reviewing and approving Genzyme's appointment of
sub-distributors for the Systems within the Territory;

             (i) at the request of either Party, determining whether a product
or potential product is an Improvement Product; and

             (j) performing such other functions as are specified in this
Agreement or as the parties may decide are appropriate to further the commercial
success of the Systems in the Territory and the purposes of this Agreement,
including the periodic evaluation of actual performance against performance
objectives.

         2.4 QUORUM; VOTING. The presence of all four (4) voting members, shall
constitute a quorum for purposes of consideration and action by the
Collaboration Committee. Each member (including the

                                       9
<PAGE>

Chairman) shall have one vote on all matters requiring a vote, and whenever
action is to be taken to approve any matter requiring the authorization or
approval of the Collaboration Committee, a unanimous vote of all four (4)
members of the Collaboration Committee shall be required to approve or authorize
such matters. The Collaboration Committee may take any action, including
providing its approval for any matter, by means of a written consent signed by
each of the four (4) members of the Collaboration Committee. For matters as to
which the Collaboration Committee is to review and provide advice (rather than
take action or make a determination), a quorum shall not be required and advice
shall be determined by a consensus of all participating members of the
Collaboration Committee, so long as at least one designee of each of Genzyme and
Focal shall be present and participating. If the Collaboration Committee is
unable to obtain the vote required to approve, or take other action on, any
matter requiring a vote, or if any member of the Collaboration Committee wishes
to contest a deadlock, then the matter may be approved or settled in accordance
with Section 16.5, and any requirement for approval by the Collaboration
Committee under this Agreement shall be satisfied by action in accordance with
Section 16.5. Meetings of the Collaboration Committee may be adjourned and
reconvened if a quorum is not present.

                                   ARTICLE 3

                                  DISTRIBUTION

         3.1 APPOINTMENT OF GENZYME AS EXCLUSIVE DISTRIBUTOR.

             (a) Focal hereby appoints Genzyme as its exclusive distributor
during the Initial Term (and any Extension Term) to promote, sell and distribute
the Systems for use in the Field within the Territory, subject to the
co-promotion rights retained by Focal in the Territory pursuant to Section 3.4
of this Agreement.

             (b) Genzyme shall be entitled to appoint Third Parties to act as
wholesalers or sub-distributors of the Systems to promote, market and sell the
Systems in the Territory; provided, that (i) any appointment shall be subject to
the approval of the Collaboration Committee, and (ii) Genzyme shall cause such
Third Party as a condition to such appointment to (A) assume as its direct
obligation the obligations of Genzyme as set forth in Sections 3.2 through 3.5
(inclusive), Sections 7.4 through 7.7 (inclusive), Article 8, Section 6.11,
Section 9.2, Article 14 (except Section 14.2) and Section 16.2, (the "Assumed
Obligations"), and (B) agree that Focal shall be a third party beneficiary of
the provisions relating to the Assumed Obligations and shall have the right to
enforce the Assumed Obligations directly against such Third Party. Genzyme shall
use reasonable commercial efforts to monitor and compel compliance by such Third
Party with such Assumed Obligations, and will provide to Focal prompt written
notice of any breach by such Third Party of an Assumed Obligation. Genzyme shall
thereafter use reasonable commercial efforts to compel such Third Party to cure
the breach of its Assumed Obligation(s) and if such breach is not cured within
thirty (30) days of the date Genzyme first provides written notice to Focal (or
such additional reasonable period of time if the breach is not capable of being
cured within thirty (30) days, which period shall in no event be longer than an
additional thirty (30) days), then Genzyme shall notify Focal of such failure to
cure. Focal shall then have the right to enforce the Assumed Obligations
directly against the Third Party. If Focal waives such right to enforce the
Assumed Obligations, then Genzyme will determine an appropriate further course
of action, which may include termination of the agreement or arrangement between
Genzyme and such Third Party. Focal shall not have any obligations to such Third
Parties except under Article 8 and Article 14 (except

                                       10
<PAGE>

Section 14.1). The foregoing provisions are not intended to relieve Genzyme of
its obligation to comply with the provisions encompassing the Assumed
Obligations in other parts of the Territory, nor shall any such appointment of a
wholesaler or sub-distributor relieve or modify any obligations (other than the
Assumed Obligations) of Genzyme under this Agreement, including but not limited
to its obligations under Sections 3.2, 3.3, 3.4, 3.5 and 6.4 hereof.

         3.2 LICENSE TO USE TRADEMARKS. Focal hereby grants a co-exclusive
license to Genzyme, with the right to grant a sublicense to Third Parties
pursuant to the terms of Section 3.1(b), to use the Trademarks solely for use in
connection with the promotion, marketing, sale and distribution of the Systems
in the Field and in the Territory during the term of this Agreement. Genzyme's
use (and each Third Party sublicensee's use) of the Trademarks shall be in a
manner reasonably approved by Focal, and limited to the extent necessary or
useful for the activities of Genzyme contemplated under this Agreement.

         3.3 ACCEPTANCE OF APPOINTMENT. Genzyme hereby agrees to serve as
Focal's exclusive distributor of the Systems in the Field within the Territory
during the Initial Term and any Extension Term, and to use its reasonable
commercial efforts to diligently promote, market, sell and distribute the
Systems throughout the Territory in accordance with the terms of this Agreement.

         3.4 FOCAL RETAINED RIGHTS.

             (a) Focal shall have the right to co-promote the Systems for use in
the Field and within the Territory. The co-promotion activities of the parties
shall be conducted in accordance with policies and procedures established by the
Collaboration Committee based upon the Co-Promotion Guidelines attached hereto
as EXHIBIT B; PROVIDED THAT the polices and procedures established by the
Collaboration Committee shall meet or exceed the guidelines for performance
criteria established in the Co-Promotion Guidelines. The Co-Promotion Guidelines
attached hereto as EXHIBIT B shall remain in effect until the Collaboration
Committee shall agree to revise or modify such Co-Promotion Guidelines and,
thereafter, the Co-Promotion Guidelines, as so amended or revised, shall remain
in effect until further amended or revised Co-Promotion Guidelines are adopted
by the Collaboration Committee. Any such amended or revised Co-Promotion
Guidelines adopted by the Collaboration Committee from time to time shall be
designated as such and shall be deemed to be attached as an exhibit to this
Agreement and made a part hereof. Notwithstanding the foregoing, no revision or
modification to the Co-Promotion Guidelines may be adopted that grants to Focal
the right to sell the Systems in the Field within the Territory unless each
party has received an opinion from legal counsel that the granting of such
rights is legally permissible within the Territory.

             (b) Except as specifically provided in this Agreement, no rights or
licenses with respect to the Patent Rights, Trademarks, Commercial Know-How,
Scientific Know-How or other technical information or other proprietary rights
are granted or deemed granted by Focal to Genzyme hereunder or in connection
herewith; provided, that the foregoing shall not affect Genzyme's right under
this Agreement to use, market and resell the Systems purchased from Focal.

             (c) Except as specifically provided in this Agreement, Focal and
Third Parties receiving grants of licenses or other rights from Focal with
respect to the Systems or Trademarks, retain all rights therein in the Territory
not expressly granted to Genzyme under this Agreement. In particular, (i)
notwithstanding the distribution rights granted to Genzyme under Section 3.1,
Focal and Third Parties

                                       11
<PAGE>

receiving grants of licenses or other rights from Focal with respect to the
Systems or Trademarks, shall retain both during and after the Initial Term and
any Extension Term, the right (A) to promote, market and sell the Products and
Systems (1) outside of the Field within the Territory and (2) outside and inside
the Field outside of the Territory, (B) to conduct Research and Development
activities, and (C) to otherwise examine and consider business opportunities
with respect to the Systems and (ii) Focal shall retain the right to research,
develop, market, distribute and sell any products outside the Field and both
outside and within the Territory for (A) the prophylaxis, treatment and/or
inhibition of restenosis and/or stenosis, (B) any intraoperative use of any
product for the prevention of surgical adhesions, (C) for the sealing of leaks
after either spinal or cranial neurosurgery and (D) the coating of medical
devices during or as part of their manufacture.

         3.5 NO SALES OUTSIDE THE TERRITORY. Genzyme expressly agrees not to
make sales of the Systems outside the Territory. Genzyme shall not sell the
Systems to a Third Party which it knows is actively soliciting resale of the
Systems outside the Territory. In the event that a Focal licensee or distributor
for an area outside the Territory is selling the Systems for use in the Field in
the Territory, Focal shall use its reasonable commercial efforts, consistent
with applicable law, to stop such licensee or distributor from selling the
Systems for use in the Field in the Territory. Focal warrants that no
distributor (other than Genzyme) or licensee is entitled to sell the Systems for
use in the Field in the Territory.

                                   ARTICLE 4

                               PROMOTION AND SALE

         4.1 SALES AND PROMOTIONAL EFFORTS AND PERSONNEL.

             (a) Genzyme shall establish the promotion and sale of the Systems,
and Focal shall establish the promotion of the Systems, as important corporate
priorities of GSP and Focal, respectively, and unless otherwise specified in
this Agreement, each party shall at their expense devote appropriate resources
and shall use their reasonable commercial efforts to diligently promote sales of
the Systems for use in the Field throughout the Territory.

             (b) Genzyme and Focal agree, subject to and to the extent permitted
by Regulatory Authorities and subject to Focal's obtaining the required
Regulatory Approvals, to commence in all material respects activities relating
to the promotion and sale of Systems in accordance with this Agreement
immediately after the Effective Date. Focal shall make available to Genzyme
quantities of the Products in accordance with Sections 6.1 and 6.2 of this
Agreement to support such activities.

             (c) To fulfill their respective obligations under this Agreement,
Genzyme and Focal shall each establish and maintain a sales and promotional
group (in the case of Genzyme) and promotional group (in the case of Focal),
which may include Third Parties as permitted under this Agreement, for the
promotion and selling of the Systems in the Territory sufficient to perform
their respective obligations under this Agreement and to carry out their
respective responsibilities under the Annual Sales Plans as approved by the
Collaboration Committee. Genzyme and Focal shall each dedicate on a full or
part-time basis not less than the number of sales representatives (in the case
of Genzyme), product specialists (in the case of Focal) and other marketing,
promotion, sales, administrative, repair and Systems support personnel
identified in the Co-Promotion Guidelines or the

                                       12
<PAGE>

Annual Sales Plans to the promotion and sale of the Systems. Each party shall be
solely responsible for the hiring, compensation, management, supervision and
evaluation of its personnel.

             (d) If either party believes that the other party is not promoting
the Systems in accordance with the Annual Sales Plans approved by the
Collaboration Committee or the terms of this Agreement (including, in
particular, the provisions of this Article 4), such party shall bring such
concerns to the Collaboration Committee, and any disputes with respect to
efforts of the other party shall be resolved by the Collaboration Committee,
and, if not resolved to the reasonable satisfaction of Focal and Genzyme in that
forum, in accordance with Section 16.5 hereof.

         4.2 ANNUAL SALES PLANS, SALES REPORTS AND ANNUAL SALES FORECASTS.

             (a) Focal and Genzyme shall jointly prepare and submit to the
Collaboration Committee (i) within 90 days after the Effective Date of this
Agreement a detailed plan for promotional, marketing and sales activities to be
conducted for the System Launch of the FocalSeal(R)-L System in the United
States (the System Launch plan for the FocalSeal(R)-L System in the United
States, and the System Launch plan for any other System in any country within
the Territory, a "Launch Plan") in accordance with the Co-Promotion Guidelines
attached hereto as EXHIBIT B, as subsequently amended or revised from time to
time in accordance with Section 3.4(a) hereof, and (ii) prior to September 30th
of each calendar year during the Initial Term and any Extension Term a
reasonably detailed marketing and sales plan (the "Annual Sales Plan") for the
following year for all Systems that have received Regulatory Approval, including
as part of the Annual Sales Plan, one or more Launch Plans for any System for
which Regulatory Approval is reasonably anticipated to be received during the
following year (the Annual Sales Plans and the Launch Plans, collectively, the
"Plans"). Each Annual Sales Plan shall be designed to optimize commercialization
of the System for use in the Field within the Territory, and among other
provisions, shall include (i) a detailed report of the prior year's promotion
and marketing activities and sales results, including annualized information
with respect to the data furnished in the Monthly Sales Reports described in
Section 4.2(c), (ii) information concerning promotional, training and marketing
activities planned for the next year, (iii) the Annual Sales Forecasts for the
next year as described in Section 6.3(a), (iv) a detailed budget for the next
year that includes an estimate of the aggregate and per unit Manufacturing Costs
for each Product and the estimated promotional and selling expenses for each of
the Systems, and the aggregate amount of Promotional Materials Expenses
projected for each party, and (v) a description of specific responsibilities and
duties to be performed by Focal and Genzyme during the next year in addition to
the activities required under this Agreement.

             (b) The Collaboration Committee shall review the Plans and shall
provide comments and suggestions to Focal and Genzyme. If either party does not
agree with or accept the comments or suggestions of the Collaboration Committee,
such party may request a meeting of the Collaboration Committee to discuss such
objections. When the parties and the Collaboration Committee have reached
agreement, the Plans shall be relied upon as the guidelines for the marketing,
sale and development of the Systems in the Territory during the applicable year.
Until the parties and the Collaboration Committee reach an agreement on a Plan,
the Plan submitted by Focal and Genzyme to the Collaboration Committee for the
previous year shall be relied upon for the applicable year.

             (c) Not later than the 20th day of each month in which sales occur,
Genzyme shall submit to the Collaboration Committee a monthly report for the
preceding month period (the "Monthly Sales Reports"). The Monthly Sales Reports,
which shall be stated in Dollars, shall include the

                                       13
<PAGE>

following information with respect to the preceding month: (i) the unit volumes
and the Dollar amount of purchases of each of the Products purchased by Genzyme
from Focal, (ii) the unit volumes and the aggregate Dollar amount of resales of
each of the Systems sold by Genzyme to Third Parties in each of the countries
within the Territory, and (iii) the identity of Third Parties that purchased the
Systems and the amount of such purchases, sorted in a manner reasonably
determined by the Collaboration Committee. Not later than the 15th day of each
month in which sales occur, Focal shall provide Genzyme with a report regarding
its promotional activities during the preceding month containing such
information as Genzyme shall reasonably request. To the extent appropriate,
Genzyme shall incorporate such information into the Monthly Sales Reports.

             (d) The Monthly Sales Report submitted to the Collaboration
Committee in January, April, July and October of each calendar year shall
include a calculation of the Average Net Sales Price for the preceding calendar
quarter in accordance with Section 6.6(b) of this Agreement.

             (e) The Monthly Sales Report submitted to the Collaboration
Committee in September of each calendar year shall include the proposed Annual
Sales Forecast for the next calendar year in accordance with Section 6.3(a) of
this Agreement.

             (f) Not later than January 30th of each calendar year, Genzyme and
Focal shall submit to the Collaboration Committee an annual report for the
preceding 12 month period (each referred to as the "Annual Sales Report"). Each
Annual Sales Report shall include the following information with respect to the
preceding twelve (12) month period: (i) the unit volumes and the Dollar amount
of purchases of each of the Products purchased by Genzyme from Focal, (ii) the
unit volumes and the Dollar amount of resales of each of the Systems sold by
Genzyme to Third Parties in each of the countries within the Territory, (iii)
the unit volumes and the Dollar amount of inventory levels of Products
maintained by Genzyme as of December 31st of the preceding year, (iv) the
Average Net Sales Price for each of the Products in each of the countries of the
Territory, (v) a comparison of the actual Manufacturing Costs, promotional and
selling expenses and Promotional Materials Expenses to the estimates of the same
contained in the Annual Sales Plan and (vi) customer payment history on an
account-by-account basis. In addition, the Annual Sales Report shall contain
such other information concerning the promotional and marketing activities of
Focal and Genzyme as may be reasonably requested by the Collaboration Committee.

         4.3 INTERNAL AND EXTERNAL TRAINING.

             (a) Genzyme and Focal at all times shall ensure that their
respective sales and promotion groups and other employees or contractors who may
be involved in meeting their respective obligations under this Agreement are
fully trained with respect to the Systems. To satisfy this requirement, and
subject to review by the Collaboration Committee, Genzyme and Focal, at their
cost and expense (unless otherwise provided in Section 4.3), shall develop and
provide, from time to time, general sales and promotion training, Field specific
sales and promotion training and System-specific sales and promotion training to
their sales and promotion groups and other employees or contractors who may be
involved in meeting their respective obligations under this Agreement.

             (b) In connection with the System Launch of the FocalSeal
-Registeres Trademark- -L System in the United States and in addition to the
training to be furnished by Focal under Section 4.3(c) of this Agreement,
Focal, at its sole cost and expense, shall provide System-specific training
at dates and times reasonably

                                       14
<PAGE>

          CONFIDENTIAL MATERIALS OMITTED AND FILED SEPARATELY WITH THE
        SECURITIES AND EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.

requested by Genzyme to Genzyme's sales representatives at the offices of Focal
in Lexington, MA and at the offices of Genzyme in Cambridge, Framingham or Fall
River, MA. All of Genzyme's out-of-pocket expenses in sending its sales
representatives to participate in Focal assisted training (including
transportation, lodging, food and translation costs) shall be borne by Genzyme.

             (c) During each calendar year following the System Launch of the
FocalSeal -Registered Trademark- -L System in the United States, Focal shall
provide System-specific training at dates and times reasonably requested by
Genzyme to Genzyme's sales representatives and to Third Parties at locations
other than the Focal offices in Lexington, MA or Genzyme's offices in
Cambridge, Framingham or Fall River, MA. Focal shall be responsible for the
aggregate cost of providing knowledgeable and experienced trainers to conduct
such training for up to [**] days each calendar year, and for eligible
out-of-pocket expenses incurred in furnishing such training up to [**] each
calendar year. Genzyme shall be obligated to reimburse Focal for the
reasonable cost of trainers and eligible out-of-pocket expenses in excess of
such amounts. "Eligible out-of-pocket expenses" shall be expenses incurred
and actually paid in conformance with travel and entertainment policies
reasonably established by Genzyme and generally applicable to the Genzyme
sales force.

             (d) As part of such training assistance, Focal shall supply, at its
cost, the sample Systems used during such training and reasonable quantities of
System training materials. Focal shall provide Genzyme with a copy of all
training materials for review and comment prior to use, and Focal shall
accommodate all reasonable comments suggested by Genzyme in a timely manner.
Genzyme may copy any training materials or methods provided or utilized by Focal
for future training programs to be conducted by Genzyme. In addition to
participating in training programs, Focal shall assist Genzyme in continuing
medical education programs for Third Party users of the Systems by providing to
Genzyme appropriate medical, clinical and scientific information as it becomes
available to Focal.

         4.4 ADVERTISING AND PROMOTIONAL MATERIALS.

             (a) Genzyme shall be responsible for the form and content of all
marketing and promotional materials related to the Systems for use in the
Territory; provided, that all marketing and promotional materials shall be
reviewed in advance and approved by Focal for purposes of determining compliance
with the requirements of the applicable Regulatory Authorities. To the extent
reasonably requested by Genzyme, Focal shall (i) create, design, develop and
prepare such materials ("design activities"), and (ii) produce and deliver to
Genzyme a sufficient supply of promotional materials for use within the
Territory to meet Genzyme's reasonable promotional needs ("production
activities"). Prior to commencing any design activities or production activities
for materials to be used in the Territory, Focal shall present such plans or
materials to Genzyme for review and approval. To the extent permitted under its
agreements with Third Parties, Focal agrees to furnish to Genzyme copies of all
marketing and promotional materials for the Systems prepared by Focal or by
Third Parties selling the Systems outside of the Territory, and to permit
Genzyme to adopt and use such marketing and promotional materials within the
Territory.

             (b) With respect to written and visual promotional or educational
materials, Focal shall be presented and described as the party that developed
and manufactured the Systems, and with

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equal size and prominence Genzyme shall be presented and described as the
exclusive distributor of the Systems in the Field and within the Territory. As
permitted by applicable laws and regulations, all documentary information,
promotional material and oral presentations (where practical) promoting the
Systems in the Territory shall display the trade names, logos and trade dress of
the Systems in a manner that promotes the Systems and each of the parties in an
appropriate manner in accordance with this Agreement. Focal agrees to provide
Genzyme with promotional materials in English, French and Spanish for use in the
Territory.

             (c) Subject to Section 4.4(d) of this Agreement, aggregate
Promotional Materials Expenses for design activities up to [**] incurred
by Focal in connection with the System Launch of the FocalSeal -Registered
Trademark- -L System in the United States shall be borne solely by Focal. All
Promotional Materials Expenses for design activities related to the System
Launch of the FocalSeal(R)-L System in the United States in excess of [**]
shall be allocated among the parties based upon a determination to be made by
the Collaboration Committee. For each year commencing with the calendar year
immediately following the year the FocalSeal -Registered Trademark- -L System
is launched in the United States, Focal shall be responsible for up to the
first [**] (as adjusted to reflect changes in the U.S. Producer Price Index
or other similar measure of price increases in the United States) of
aggregate Promotional Materials Expenses incurred by the parties for design
activities. All Promotional Materials Expenses for design activities in
excess of such annual limit shall be allocated among the parties based upon a
determination to be made by the Collaboration Committee. For all Promotional
Materials Expenses incurred by the parties for production activities in
connection with the System Launch of the FocalSeal -Registered Trademark- -L
System in the United States and thereafter during each year following the
System Launch, Focal shall be responsible for [**] and Genzyme shall be
responsible for [**] of the aggregate Promotional Materials Expenses.

             (d) Estimates of the projected annual Promotional Materials
Expenses shall be included in the Annual Sales Plan. If Genzyme elects to obtain
some or all of the promotional materials from Third Parties, subject to approval
by the Collaboration Committee, which approval shall not be unreasonably
withheld, each party shall reimburse the other party to the extent necessary in
accordance with the allocations set forth in Section 4.4(c) of this Agreement.
Notwithstanding anything to the contrary contained in this Agreement,
Promotional Materials Expenses incurred by either party in excess of 110% of the
amounts projected for such party as set forth in the Launch Plan or any Annual
Sales Plan, or as otherwise permitted by action of the Collaboration Committee,
shall not be eligible for reimbursement and shall be borne solely by the party
incurring such excess expenses.

         4.5 SYSTEM PACKAGING. The System shall be promoted, marketed and
sold under brand names selected by Genzyme and approved by the Collaboration
Committee (including without limitation the FocalSeal -Registered Trademark-
-L and FocalSeal -Registered Trademark- -S brand names), which approval shall
not be unreasonably withheld or delayed, PROVIDED THAT any incremental
expenses associated with the use of a brand name other than FocalSeal
-Registered Trademark- -L and FocalSeal -Registered Trademark- -S shall be
borne by Genzyme. The packaging and inserts, and all sales and promotional
materials, for the Systems shall identify both parties with equal prominence,
and shall bear both the Focal name, trademarks and logo and the Genzyme name,
trademark and logo in equal size and prominence, designating Focal as the
developer and manufacturer of the Systems and Genzyme as the exclusive
distributor of the Systems in the Territory in the Field. Focal agrees that
it will not create a

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trade dress for any Systems intended for sale outside of the Territory that is
not, at its cost and expense, easily distinguishable at first glance from
Systems intended for sale within the Territory.

         4.6 MEDICAL CONFERENCES. Focal and Genzyme shall participate annually
at all major pulmonary, cardiovascular, gastrointestinal and other medical
conferences, meetings, symposia and trade shows within the Field and held within
the Territory reasonably determined by the Collaboration Committee to be
important to the promotion and sale of the Systems including, but not limited
to, the regular meetings of the American Association of Thoracic Surgeons, the
Society of Thoracic Surgeons, the American College of Surgeons, the General
Thoracic Surgical Club and the American Society of Colorectal Surgery, and other
similar meetings. As reasonably determined by the Collaboration Committee,
participation by Focal at such meetings shall include, but shall not be limited
to, making available to Genzyme experienced and knowledgeable Focal
representatives trained with respect to the Systems who shall work within
Genzyme's exhibition space for a substantial portion of such meetings to promote
the Systems. Focal shall not charge Genzyme for the cost of its representatives
attending and participating at such meetings and the time expended by Focal's
representatives shall not be considered a training activity under Section 4.3 of
this Agreement. Focal shall be entitled to receive reimbursement for reasonable
out-of-pocket expenses incurred by its representatives who attend such meetings
solely to provide assistance to Genzyme within its exhibition space.

         4.7 MEDICAL INQUIRIES. Genzyme shall have responsibility for the
preparation and distribution of correspondence and information to physicians in
the Territory relating to the Systems in the Field; provided, that upon the
reasonable request of Genzyme, Focal shall, at its own cost and expense, provide
assistance to Genzyme in meeting this obligation. Genzyme will keep such records
as shall be necessary to document physician inquiries in compliance with
applicable regulatory requirements. Except in the case of medical emergency,
Genzyme will refer all questions relating to the Systems raised by physicians in
the Territory to Focal for its response. Genzyme shall have the right to refer
medical inquiries to Focal if Genzyme does not have the requisite
Systems-related medical expertise to respond to such inquiries. In such event,
Focal shall be responsible for responding to such inquiries and Focal personnel
shall have direct access to the inquiring physicians. At the request of Genzyme,
Focal shall cooperate with Genzyme to develop jointly form response letters
which contain information responding to the most frequent or routine questions
received regarding the Systems.

         4.8 SALES ADMINISTRATION. Genzyme, at its cost and expense, shall be
responsible for handling all matters directly related to System sales
administration, including without limitation, originating and confirming System
orders, working with Focal to track the status of System shipments, preparing
and delivering System invoices, processing and collecting outstanding
receivables on System sales to Third Parties, answering System inquiries and
otherwise performing clerical and bookkeeping functions associated with such
activities. Focal shall cooperate with Genzyme in carrying out these duties, and
upon Genzyme's request, shall provide such assistance as may be reasonably
requested.

         4.9 PROMOTION AND MARKETING EXPENSES. Except as otherwise provided in
this Agreement, all costs and expenses incurred by Focal or Genzyme in
distributing, promoting and, solely in the case of Genzyme, selling a System in
the Territory in accordance with the terms of this Agreement shall be borne by
the party incurring such expenses.

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                                   ARTICLE 5

                        PRODUCT RESEARCH AND DEVELOPMENT,
                           MANUFACTURING AND SERVICING

         5.1 COLLABORATION COMMITTEE ROLE. At least once each calendar quarter
during the term of this Agreement, Focal shall present a report to the
Collaboration Committee regarding Research and Development and Product
manufacturing and warranty servicing that may have an effect on the
commercialization of the Systems for use in the Field within the Territory. The
views, if any, expressed by members of the Collaboration Committee shall be
advisory, and Focal shall be under no obligation to consider or to act on such
views, except with respect to action that is taken by the Collaboration
Committee on matters expressly within the authority granted to the Collaboration
Committee under this Agreement.

         5.2 RESEARCH AND DEVELOPMENT. Focal shall be responsible for conducting
any Research and Development activities that it determines, in its sole
discretion acting in good faith, to be necessary or advisable to commercialize
the Systems for sale for use in the Field in the Territory as contemplated by
this Agreement, including without limitation any Research and Development
activities that it determines are necessary or advisable to develop product
enhancements or improvements necessary to maintain the competitiveness of the
Systems in the Territory. Although Focal shall have the sole responsibility for
conducting such activities, Focal shall give adequate and due consideration to
Genzyme's concerns in connection with such process. The parties acknowledge that
Focal shall have the right, subject to the limitations set forth in this
Agreement, to conduct any and all additional Research and Development
activities, including clinical studies, relating to the Systems or other
products that Focal desires to conduct for uses outside the Field and/or outside
of the Territory.

         5.3 MANUFACTURING. Focal shall manufacture, or shall obtain from Third
Party suppliers, the Products for sale to Genzyme and for subsequent resale by
Genzyme to Third Parties exclusively in the Territory. All Products sold to
Genzyme shall be supplied in a finished form and shall be incorporated into
packaging that is suitable for delivery to Third Parties.

         5.4 SUPPLY SHORTAGES.

             (a) COLLABORATION COMMITTEE ATTENTION. If at any time Focal becomes
unable to meet the Annual Sales Forecast for any Product or becomes aware that
it will be unable to meet such Annual Sales Forecast for any Products, Focal
shall immediately bring such problem to the attention of the Collaboration
Committee. The Collaboration Committee shall work with Focal to identify methods
of increasing production or to locate alternative providers. Focal shall
consider the recommendations of the Collaboration Committee and shall implement
such remedial actions as it determines are appropriate, but in any event Focal
shall respond to the supply shortage with speed and diligence commensurate with
the severity of the current or potential supply shortage.

             (b) EQUITABLE SUPPLY. If Focal is unable to meet the world-wide
requirements of any Product, Focal shall not supply such Products to any other
distributor in a preferred manner to Genzyme. To the contrary, Focal shall
allocate among such other distributors and Genzyme those quantities of Products
that Focal has in its inventory and that Focal is able to produce or obtain on a
fair and equitable basis taking into consideration on a relative basis with
respect to each distributor and Genzyme, the sales

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of the Product for the preceding calendar year and reasonable projections of
Product sales during the anticipated period of the supply shortage.

             (c) SUPPLY MINIMUMS. If Focal is [**] to supply one or more
Products to Genzyme in amounts at least equal to meet (i) [**] of the
quantities for such quarters set forth in the applicable Annual Sales
Forecast for the Light Source, Light Wand or Lamp Module, or (ii) [**] of the
quantities for such quarters set forth in the applicable Annual Sales
Forecast for the Sealant, Primer or Applicators (for purposes of this Section
5.4, a "Triggering Event"), then, Genzyme shall, subject to Genzyme's notice
obligations and Focal's cure rights as set forth below, be entitled to
exercise the rights set forth in subsection (d) with respect to the
Product(s) related to the Triggering Event (the "Shortfall Product(s)"). The
number of units of Products which Focal was obligated, but failed, to supply
to Genzyme to meet the applicable [**] or [**] requirements set forth in this
Section 5.4(c) are referred to herein as the "Shortfall Units".

             (d) NOTICE AND CURE. Within twenty (20) days after the occurrence
of a Triggering Event, Genzyme may give notice to Focal of such event. Focal may
cure the supply deficiency by supplying to Genzyme, in the quarter immediately
following the [**] consecutive quarter period during which such Triggering Event
has occurred (the "Cure Quarter"), the quantity of those Products identified in
the Genzyme notice equal to (i) all Shortfall Units plus (ii) the lesser of (A)
a number of units of the Shortfall Product at least equal to the percentages of
the quantities set forth for the applicable Shortfall Product (i.e. [**] for the
Light Source, Light Wand or Lamp Module and [**] for the Sealant, Primer or
Applicators) for the Cure Quarter set forth in the applicable Annual Sales
Forecast, or (B) the number of units of the Shortfall Product which Genzyme has
ordered for delivery in the Cure Quarter. If Genzyme delivers this notice and
Focal fails to cure the supply deficiency for any Shortfall Product as provided
in the preceding sentence, then Genzyme may elect by giving notice to Focal,
within twenty (20) days after the end of the Cure Quarter, to either (i)
terminate this Agreement in accordance with Section 11.4(c), (ii) obtain its
future supply requirements of the Shortfall Products from Third Party suppliers
in accordance with Section 5.4(e), (iii) manufacture its supply requirements of
the Shortfall Products in accordance with Section 5.4(f), or (iv) to exercise
any combination of the remedies described in clauses (ii) or (iii) of this
Section 5.4(d) (the "Election Notice").

             (e) THIRD PARTY SUPPLIERS. If Genzyme elects to obtain some or all
of the Shortfall Products from Third Parties, Genzyme agrees that the Shortfall
Products supplied by the Third Party shall comply with the requirements of any
applicable Regulatory Approval. A Shortfall Product obtained from a Third Party
supplier shall not be subject to, or included in the calculation of, the
Purchase Minimums unless such Shortfall Product is to be incorporated into and
sold in combination with another Product supplied by Focal. In such event, the
Collaboration Committee shall, to the extent required, equitably adjust the
Purchase Minimums for the applicable combination Product which incorporates
Shortfall Products that are thereafter supplied by Third Parties.

             (f) MANUFACTURING. Upon the delivery of an Election Notice under
Section 5.4(d)(iii) or (iv), Focal shall automatically be deemed to have granted
to Genzyme an irrevocable, exclusive, royalty bearing license under the Focal
Patent Rights and the Trademarks (with a right to sublicense) (the
"Manufacturing License"), solely for Genzyme to make, have made, use and have
used, and import

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the Shortfall Products for distribution and sale within the Field in the
Territory. The term of the Manufacturing License shall commence on the date of
delivery of the Exercise Notice under Section 5.4(d)(iii) or (iv) and shall
continue, as applicable, during the Initial Term or any Extension Term, PROVIDED
THAT if the Exercise Notice is delivered more than [**] years after the
commencement of the Initial Term, the term of the Manufacturing License shall
end [**] years after the date of delivery of the Exercise Notice, but only
if the Agreement is extended for the final Extension Term by Genzyme pursuant to
Section 11.2. Upon and after activation of the Manufacturing License under the
terms hereof, Focal, at its cost and expense, shall (A) furnish to Genzyme
within sixty (60) days after the Election Notice all Manufacturing Know-How
necessary to allow Genzyme to scale up full manufacturing of the Shortfall
Products, (B) render to Genzyme such technical, administrative, engineering and
other assistance reasonably requested by Genzyme to facilitate the orderly,
efficient and expeditious transition of the Shortfall Product manufacturing to
Genzyme, (C) execute and deliver any agreements, notices, assignments and other
instruments mutually agreed upon by Genzyme and Focal to be necessary to
consummate such transition and (D) provide to Genzyme, or its designees, such
additional records and information relating to this Agreement that does not
constitute Focal Proprietary Information.

             (g) ROYALTY PAYMENT. With respect to each of the Shortfall Products
for which Genzyme has submitted an Election Notice under Section 5.4(d)(ii),
(iii) or (iv), Genzyme shall pay to Focal, within 45 days after the end of each
calendar quarter, a royalty equal to [**] of the difference between (x) the
Average Net Sales Price of each unit of Shortfall Product multiplied by the
number of Shortfall Units sold in each country of the Territory during the
preceding calendar quarter, and (y) the Manufacturing Costs of each unit of such
Shortfall Product multiplied by the number of Shortfall Units sold in each
country of the Territory (the "Genzyme Royalty"), subject to adjustment under
subsection (h) below.

             (h) TRANSITIONAL COST RECAPTURE.

             (i) As used in this Section, "Transitional Costs" shall mean the
actual incremental costs incurred by Genzyme in connection with the commencement
of the manufacturing process for the Shortfall Products for which Genzyme has
obtained a Manufacturing License, including, but not limited to technology
transfer, manufacturing scale-up and validation, regulatory compliance, quality
control and quality assurance.

             (ii) In order to permit Genzyme to recapture the Transitional
Costs, notwithstanding the provisions of subsection (g) relating to the Genzyme
Royalty, the Genzyme Royalty shall be reduced to [**] of the difference between
(x) the Average Net Sales Price of each unit of Shortfall Product multiplied by
the number of Shortfall Units sold in each country of the Territory during the
preceding calendar quarter, and (y) the Manufacturing Costs of each unit of such
Shortfall Product multiplied by the number of Shortfall Units sold in each
country of the Territory (the "Reduced Genzyme Royalty"). The Reduced Genzyme
Royalty shall be applicable until such time as the cumulative aggregate amount
of the Reduced Genzyme Royalty paid by Genzyme to Focal is equal to the
Transitional Costs, at which time the Genzyme Royalty set forth in subsection
(g) shall apply.

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             (iii) The parties acknowledge that Transitional Costs could include
costs that would also constitute Manufacturing Costs (such as amortization of
capital facility expenses). To the extent that Genzyme has recaptured
Transitional Costs pursuant to subsection (ii) above, all costs included in such
recaptured Transitional Costs shall be excluded from the Manufacturing Costs for
purposes of calculating the Genzyme Royalty or the Reduced Genzyme Royalty.

             (i) WARRANTY ON SHORTFALL PRODUCTS. Focal shall warrant to Genzyme
that all Shortfall Products which are thereafter manufactured by Genzyme
pursuant to Section 5.4(f) or that Genzyme elects to have supplied by Third
Parties pursuant to Section 5.4(e), shall, assuming that such Shortfall Products
are manufactured in accordance with, and conform to, the applicable
Specifications, be free from material defects in design (the parties hereby
acknowledging that such warranty shall be the only warranty that shall be made
by Focal to Genzyme regarding the Shortfall Products), subject to the provisions
of Section 6.11(b) and (c).

         5.5 PASS-THROUGH WARRANTY AND SERVICE FOR REUSABLE PRODUCTS.

             (a) In addition to the warranties provided by Focal to Genzyme
pursuant to Section 6.11, Focal shall pass-through to any Third Party end-user
of Light Sources, Lamp Modules and other instruments or devices (other than the
Light Wands) that are reusable and shall be packaged and sold as part of a
System (the "Reusable Products") the warranties provided to Focal by suppliers
of such Reusable Products. The terms of such warranties as they exist as of the
Effective Date are set forth in EXHIBIT C attached hereto. Focal shall not allow
the reduction or modification in any material respect of such warranties without
the approval of the Collaboration Committee, which approval shall not be
unreasonably withheld in the event of any change in warranty by any supplier of
Reusable Products.

             (b) Focal shall have responsibility for all interaction with the
suppliers of Reusable Products (subject to Genzyme's rights under Section 5.4)
including, but not limited to, the obligation, consistent with industry
standards, to inspect all deliveries of Reusable Products for conformity with
all applicable warranties.

             (c) Focal, at its cost and expense, shall be responsible for
performing, either directly or indirectly, all repair, replacement and other
after-sale support services for the Reusable Products. Such services shall
include repair and replacement services during and after the expiration of the
applicable warranty. Focal shall cause such services to be performed in
accordance with the requirements of the applicable Regulatory Authorities. Focal
may charge Third Party end-users reasonable fees and expenses as approved by the
Collaboration Committee for repair and replacement services furnished after the
expiration of the warranty period or otherwise outside the coverage of the
warranty, PROVIDED THAT if the Collaboration Committee cannot agree on a fee,
Focal shall establish a reasonable and customary fee for such services.

         5.6 GENERAL COMMERCIALIZATION ACTIVITIES.

             (a) Except for those duties or responsibilities specifically
assigned to Genzyme under this Agreement, or as specifically assumed by Genzyme
under any approved Launch Plan, Annual Sales Plan or under Section 5.4, Focal
shall be responsible for all aspects of the commercialization of the Systems in
the Territory, including without limitation, testing, packaging, labeling,
storing, shipping, supplying and customer support for the Systems but
specifically excluding sales of the Systems.

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             (b) Focal shall not have any right to sell, or to represent to any
Third Party that it has the authority or power to commit Genzyme to make a sale,
of the Systems in the Field within the Territory. All sales that may arise as a
indirect consequence of promotional activities conducted by Focal shall be sales
completed by Genzyme, and all payments received from Third Party purchasers
shall be recognized as revenue of Genzyme.

             (c) The parties acknowledge that Focal shall have the right,
subject to the limitations set forth in this Agreement, to manufacture, package,
label, ship and supply the Systems for use outside the Field and/or for sale
outside of the Territory.

         5.7 RESPONSIBILITIES OF GENZYME.

             (a) Genzyme shall cooperate with and render to Focal research,
technical and engineering consultation, including making its personnel available
at reasonable times, for reasonable periods and at reasonable fees, to
facilitate Research and Development activities and to assist in Product
manufacturing upon the reasonable request of the Collaboration Committee.

             (b) The parties acknowledge that Genzyme shall have the right,
subject to the limitations set forth in this Agreement, including, but not
limited to, the provisions of Section 8.4, to conduct research, development and
commercialization activities, and to promote, market and sell products for use,
within the Field and/or for sale within the Territory.

                                   ARTICLE 6

             PRODUCT SUPPLY, FORECASTS, PURCHASE PRICE AND SHIPMENT

         6.1 SUPPLY OF THE PRODUCTS. Focal shall supply Genzyme with all of
Genzyme's purchase requirements for the Products in the Territory for use in the
Field. Genzyme shall purchase all such purchase requirements exclusively from
Focal, except to the extent otherwise permitted pursuant to Section 5.4 of this
Agreement. Focal shall not be obligated to supply in any calendar quarter a
number of units of each Product that is greater than [**] of the number of units
of such Product specified in the applicable Annual Sales Forecast.

         6.2 DEMONSTRATION SYSTEMS. Each Launch Plan and each Annual Sales Plan
shall establish the number of units of sample Products that each party
anticipates will be necessary during each calendar quarter to achieve the
promotional and sale objectives of the relevant Plan. Focal shall supply samples
in accordance with the Plans, which samples shall be in a sterile condition
(unless the Product is sold in a non-sterile condition), and shall be deemed to
have a price equal to their Manufacturing Costs. The aggregate price of samples
supplied by Focal shall be shared equally by Genzyme and Focal; provided that
(a) each party shall bear the full cost of Light Sources and Light Wands for its
respective sales/promotional activities, and (b) if either party uses in excess
of [**] of the number of units of samples of Products (other than Light Sources
and Light Wands) projected for such party in the Launch Plan (through the end of
the launch period) or Annual Sales Plan (for the calendar year covered by the

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Annual Sales Plan), the party using the excess samples shall be solely
responsible for the cost of the number of units of samples in excess of [**].
Genzyme shall pay for samples that it orders from Focal at a price equal to [**]
of the Manufacturing Costs within forty-five (45) days after the date of the
related invoice provided, that at such time as Genzyme's sample orders for a
Product exceed [**] of its projected annual samples, Genzyme shall pay Focal
[**] of the Manufacturing Costs for any units in excess of [**] of such amount.
Further, within twenty (20) days after the end of each calendar quarter, Focal
shall deliver to Genzyme a statement of the number of units of Products (other
than Light Sources and Light Wands) used by Focal as sample Products during the
preceding calendar quarter. Within forty-five (45) days after receipt of such
statement, Genzyme shall pay Focal [**] of the Manufacturing Costs of the
samples identified in the statement; provided that at such time as the samples
of a Product used by Focal exceed [**] of its projected annual samples, Genzyme
shall not be obligated to pay Focal any portion of the Manufacturing Costs for
such excess samples. Sample units of Products shall be used solely for
demonstration and training purposes and not for resale, and shall not be counted
for the purposes of calculating the achievement by Genzyme of the Purchase
Minimums.

         6.3 ANNUAL SALES FORECASTS.

             (a) ANNUAL SALES FORECASTS. Attached hereto as Exhibit D is a
proposed forecast, broken down on a quarterly basis, of Genzyme's projected
sales in units for each of the Products in the Territory commencing January
1, 2000, and ending December 31, 2000. Within 30 days after the System Launch
of the FocalSeal -Registeres Trademark- -L System in the United States, the
Collaboration Committee shall make such adjustments to this estimate as it
deems advisable (including prorating the forecast to reflect that portion of
the calendar year that remains available for System sales after the System
Launch), and shall adopt such forecast as the forecast for calendar year
2000; provided, that if the Collaboration Committee is not able to reach
agreement on the Annual Sales Forecast for calendar year 2000 within such 30
day period, the forecast set forth as EXHIBIT D shall become the Annual Sales
Forecast for calendar year 2000, appropriately prorated from the date of
first commercial sale in the United States of the FocalSeal -Registered
Trademark- -L System. Thereafter, annually together with the September
Monthly Sales Report, Genzyme shall provide to the Collaboration Committee a
proposed twelve (12) month forecast for the next calendar year broken down on
a quarterly basis of Genzyme's projected sales in units for each of the
Systems in the Territory which shall be subject to review and approval of the
Collaboration Committee as described in Section 6.3(b) of this Agreement (the
initial and subsequent forecasts, collectively, the "Annual Sales Forecasts").

             (b) ANNUAL PURCHASE OBJECTIVES AND REVISED SALES FORECASTS. The
Collaboration Committee shall review each proposed Annual Sales Forecast with
Genzyme, and in conjunction with its approval of the Annual Sales Plan and
subject to any revisions that may be reasonably required by the Collaboration
Committee, shall approve the Annual Sales Forecast as submitted or with such
modifications thereto as the Collaboration Committee may deem appropriate, and
such approved Annual Sales Forecast shall serve as Genzyme's purchase objectives
for the following year. Genzyme shall submit to the Collaboration Committee a
revised sales forecast for any calendar quarter during which Genzyme's sales for
such calendar quarter are projected to exceed by more than twenty-five percent
(25%) the quarterly forecast set forth in the Annual Sales Forecast previously
approved by the Collaboration Committee, which revised quarterly forecast shall
be submitted solely for the purpose of

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enabling Focal to plan its manufacturing production for such period and shall
not be used for purposes of determining whether Genzyme has satisfied the
Purchase Minimums set forth in Section 6.4(a) of this Agreement or for purposes
of determining whether a Triggering Event under Section 5.4 has occurred.
Subject to the terms of this Agreement, Genzyme shall not be obligated to
satisfy the purchase objectives, but Genzyme shall use reasonable commercial
efforts to do so.

             (c) DISAGREEMENT REGARDING THE ANNUAL SALES FORECASTS. If the
Collaboration Committee is unable to reach agreement to approve any Annual Sales
Forecast, Focal and Genzyme agree to negotiate the Annual Sales Forecast in good
faith. If Focal and Genzyme are unable to reach agreement within thirty (30)
days after either party furnishes notice to the other that it believes a
deadlock exists, then the Annual Sales Forecast and Purchase Minimums shall be
determined in accordance with the procedures set forth in Section 16.5 of this
Agreement, except that a deadlock with respect to establishing the Annual Sales
Forecast for 2000 shall be resolved as set forth in Section 6.3(a). During the
period that the parties are seeking to reach agreement on the Annual Sales
Forecast, the Annual Sales Forecast and Purchase Minimums in effect during the
immediately preceding calendar year, appropriately prorated with respect to any
period which is less than a full calendar year in a manner consistent with the
pro-ration method used for the commencement of the Annual Sales Forecast for
calendar year 2000, shall apply, subject to retroactive adjustment to reflect
the revised Annual Sales Forecast determined in accordance with Section 16.5 of
this Agreement.

         6.4 PURCHASE MINIMUMS.

             (a) TIER I PURCHASE MINIMUMS. Except as provided in subsection
6.4(c) below, commencing with the calendar year during which Regulatory
Approval in the United States for the FocalSeal -Registered Trademark- -L
System is first received and in each calendar year thereafter, Genzyme agrees
to purchase from Focal in accordance with the provisions of this Agreement
not less than [**] of the Annual Sales Forecast for each Product projected
for each calendar quarter of the applicable calendar year or partial year, as
the case may be ( the "Tier I Purchase Minimums"). If Genzyme fails to
satisfy a Tier I Purchase Minimum for a Product within ten (10) days after
the receipt of notice from Focal regarding such failure, Genzyme shall be
entitled to notify Focal of its intent to cure such deficiency by purchasing
sufficient quantities of the relevant Product to achieve the Tier I Purchase
Minimum; PROVIDED THAT Focal may refuse to allow such cure if Genzyme has
cured a Tier I Purchase Minimum for the relevant Product at any time during
the preceding [**] year period.

             (b) TIER II PURCHASE MINIMUMS. Except as provided in subsection
6.4(c) below, commencing with the calendar year during which Regulatory
Approval in the United States for the FocalSeal -Registered Trademark- -L
System is first received and in each calendar year thereafter, Genzyme agrees
to purchase from Focal in accordance with the provisions of this Agreement,
not less than [**] of the Annual Sales Forecast for each Product projected
for each calendar quarter of the applicable calendar year or partial year, as
the case may be ( the "Tier II Purchase Minimums"). If Genzyme fails to
satisfy a Tier II Purchase Minimum for a Product, within ten (10) days after
the receipt of notice from Focal regarding such failure Genzyme shall be
entitled to notify Focal of its intent to cure such deficiency by purchasing
sufficient quantities of the relevant Product to achieve the Tier II Purchase
Minimum; provided that

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          CONFIDENTIAL MATERIALS OMITTED AND FILED SEPERATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.

Focal may refuse to allow such cure if Genzyme has cured a Tier II Purchase
Minimum for the relevant Product at any time during the preceding two (2) year
period.

             (c) LIMITATION OF PURCHASE MINIMUMS. Notwithstanding anything
herein to the contrary, no Purchase Minimum shall be established for, and
Genzyme shall have no minimum purchase obligation with respect to, Light
Sources, Light Wands and Lamp Modules.

             (d) CURE OF PURCHASE MINIMUM DEFICIENCIES. Unless Focal determines
that Genzyme does not have the right to cure a Purchase Minimum pursuant to the
proviso contained in the last sentence of each of subsections 6.4(a) and 6.4(b)
above, upon receipt of a Genzyme cure notice, Focal shall not be entitled to
terminate this Agreement pursuant to Section 11.5(b) of this Agreement if
Genzyme purchases and pays for a sufficient number of units of Products to
satisfy the Purchase Minimum deficiency within ninety (90) days after the date
of the Genzyme cure notice.

         6.5 PURCHASE ORDERS AND PROCEDURES. Genzyme shall place orders for the
Products pursuant to written or oral purchase orders in accordance with purchase
procedures mutually acceptable to the parties (which shall include, among other
things, the procedures for Focal's written acceptance of any purchase order).
The purchase procedures shall provide for the delivery of written purchase
orders by mail, overnight courier or facsimile, and for the delivery of oral
purchase orders if a written purchase order confirming the oral purchase order
is received within five (5) days after the oral purchase order. The quantities
and dates of delivery established by the purchase order or procedure shall be
binding upon Genzyme and Focal. Upon request, Focal will acknowledge and confirm
to Genzyme in writing its obligation to satisfy the supply requirements set
forth in the Genzyme purchase order. Focal shall not be deemed in default for a
delay in fulfilling any purchase order if the Products are shipped in full
satisfaction of the purchase order within four (4) business days from the time
of Focal's receipt of the purchase order, PROVIDED THAT, if the Annual Sales
Forecast is revised to increase the quantity of the Products which Focal is
required to ship to Genzyme, then the time period in which Focal is required to
fulfill any purchase order for such Products shall be increased from four (4)
business days to such commercially reasonable number of days as is agreed to by
the Collaboration Committee, and FURTHER PROVIDED that the aggregate quantities
of such Product ordered for such calendar quarter are not in excess of [**] of
the Annual Sales Forecast for that Product for such calendar quarter.

         6.6 PURCHASE PRICE.

             (a) PURCHASE PRICE. The purchase price per unit for each of the
Products sold by Focal to Genzyme (the "Purchase Price") shall be established
for each country in the Territory, shall be determined by the Collaboration
Committee based upon its review and approval of the methods of calculating
Manufacturing Costs and Average Net Sales Price pursuant to Section 2.3(d), and
shall be an amount equal to:

             (i) in the case of Lamp Modules, Light Sources and Light Wands, (A)
the Manufacturing Costs of each unit of a Product, PLUS (B) [**] of the
difference between (1) the Average Net Sales Price of each unit of a Product
sold in each country of the Territory during the preceding calendar quarter, and
(2) the Manufacturing Costs of each unit of such Product; and

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          CONFIDENTIAL MATERIALS OMITTED AND FILED SEPERATELY WITH THE
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             (ii) in the case of the Sealants, Primers and Applicators, the
greater of:

                   (A) (1) the Manufacturing Costs of each unit of Sealant,
Primers and Applicators, PLUS (2) [**] of the difference between (x) the [**]
of each unit of Sealant, Primers and Applicators sold in each country of the
Territory during the preceding calendar quarter and (y) the [**] of each unit
of Sealant, Primer and Applicator; and

                   (B) The [**] of each unit of Sealant, Primer and
Applicator multiplied by:

                       (1)  A factor of [**], for any calendar year in which the
                            number of units of Sealant shipped by Focal to
                            Genzyme is less than [**] units; or

                       (2)  A factor of [**], for any calendar year in which (x)
                            the number of units of Sealant shipped by Focal to
                            Genzyme is [**] or more but less than [**] units and
                            (y) the per unit Manufacturing Costs of Sealant,
                            Primers and Applicators, taken together, at such
                            time have decreased an aggregate of no less than
                            [**] from the Manufacturing Costs of such Products,
                            taken together, in effect at the time of the first
                            sale of such Products by Focal to Genzyme; or

                       (3)  A factor of [**], for any calendar year in which (x)
                            the number of units of Sealant shipped by Focal to
                            Genzyme is [**] or more but less than [**] units and
                            (y) the per unit Manufacturing Costs of Sealant,
                            Primers and Applicators, taken together, at such
                            time have decreased an aggregate of no less than
                            [**] from the Manufacturing Costs of such Products,
                            taken together, in effect at the time of the first
                            sale of such Products by Focal to Genzyme; or

                       (4)  A factor of [**] in any calendar year in which (x)
                            the number of units of Sealant shipped by Focal to
                            Genzyme is [**] units or more and (y) the per unit
                            Manufacturing Costs of Sealant, Primers and
                            Applicators, taken together, at such time have
                            decreased an aggregate of not less than [**] from
                            the Manufacturing Costs of such Products, taken
                            together, in effect at the time of the first sale of
                            such Products by Focal to Genzyme.

         If the [**] decreases outlined above are not achieved at the
corresponding volume levels, then the factor to be used in calculating the
Purchase Price under this Section 6.6(a)(ii)(B) shall be the factor in effect
at the next lowest volume level.

             (b) PURCHASE PRICE CALCULATION. The Collaboration Committee shall
determine the Purchase Price based upon information furnished by the parties.
Within twenty (20) days after the end of each calendar quarter (i) Focal shall
deliver a report to the Collaboration Committee setting forth in reasonable
detail the Manufacturing Costs of each Product on a per unit basis during the
preceding

                                       26
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              CONFIDENTIAL MATERIALS OMITTED AND FILED WITH THE
         SECURITIES AND EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.

calendar quarter, and (ii) Genzyme shall deliver a report to the Collaboration
Committee setting forth in reasonable detail its calculation of the Average Net
Sales Price for each Product in each country of the Territory during the
preceding calendar quarter. The Collaboration Committee, in its reasonable
discretion, may require either party to submit additional data or information to
substantiate the calculations contained in the reports. Based on these reports,
which shall be subject to Collaboration Committee approval, the Collaboration
Committee shall establish the Purchase Price for the current calendar quarter
(without retroactive effect). If, for any reason, the Collaboration Committee is
not able to establish the Purchase Price for any Product within ten (10) days
after the receipt by the Collaboration Committee of the last report or the
receipt of additional information if requested by the Collaboration Committee,
the Purchase Price in effect during the preceding calendar quarter shall
continue until such time as the Collaboration Committee makes a final
determination.

             (c) Notwithstanding anything herein to the contrary, the
Manufacturing Costs of any Light Sources, Light Wands and Lamp Modules that
Genzyme, with the approval of the Collaboration Committee, provided free of
charge to end-user customers (excluding Light Sources and Light Wands for
sales/promotional activities which are the subject of the provision in Section
6.2) shall be shared equally by Focal and Genzyme.

         6.7 PAYMENT TERMS.

             (a) INVOICES AND PAYMENT TERMS. Focal shall invoice Genzyme for
the Purchase Price no sooner than the date of Product shipment. The invoices
shall require provisional payments in accordance with Section 6.7(c). Payment
of any invoice is due [**] days after the date of the invoice. All payments
hereunder to be made by Genzyme shall be in Dollars. No part of any amount
payable by Genzyme may be reduced due to any counterclaim, set-off,
adjustment or other right which Genzyme may have against Focal, except with
respect to Products that are returned to Focal in accordance with Section
6.12 of this Agreement.

             (b) METHOD AND PLACE OF PAYMENT; LATE PAYMENT INTEREST. All
payments to be made under this Agreement shall be paid by check or wire transfer
as selected by Genzyme, and shall be delivered to such address or wired to such
account or accounts as Focal shall designate from time to time in writing to
Genzyme. Any such payment shall be deemed to have been paid when received by
Focal with respect to check payments or when recorded in the proper account with
respect to wire transfer payments. Any invoice not paid prior to the due date
shall bear interest from the due date until the date payment is received in full
by Focal at a rate equal to the lesser of one percent (1.0%) per month or at the
maximum per annum rate allowed by applicable law.

             (c) PROVISIONAL PAYMENTS. The Purchase Price cannot be determined
until the Average Net Sales Price, Manufacturing Costs and the number of units
of Product purchased for the relevant Product are known or established. For this
reason, the invoice submitted by Focal at the time of Product shipment shall
require a provisional payment for each unit of Product purchased (the
"Provisional Payment"). The Provisional Payment shall be subject to adjustment
and reconciliation in accordance with Section 6.7(d). The Provisional Payment
shall be established by the Collaboration Committee prior to March 15th of each
calendar year, and shall apply for one (1) year commencing April 1 and ending
March 31. The Provisional Payment shall be calculated in the same manner as the
Purchase Price is calculated under Section 6.6(a) on the basis of the following
assumptions: (i) Manufacturing Costs shall be deemed to equal Focal's estimate
of Manufacturing Costs assuming that

                                       27
<PAGE>

the number of units of Product manufactured equals the aggregate Annual Sales
Forecast for the Product; (ii) the Average Net Sales Price shall equal the
Average Net Sales Price for the immediately preceding year, and (iii) the number
of units of Product purchased by Genzyme shall equal the aggregate Annual Sales
Forecast for the Product for the relevant year.

             (d) PAYMENT RECONCILIATION. Prior to March 15th of each calendar
year, based upon information furnished by the parties, the Collaboration
Committee (i) shall calculate the Purchase Price for the immediately preceding
year in accordance with Section 6.6(a), and (ii) shall compare the Purchase
Price against the Provisional Payment actually paid by Genzyme for each unit of
Product during the preceding year. On the basis of such calculation and
comparison, any overpayment or underpayment of the Purchase Price for all of the
units of Product sold during the preceding year (i) shall be paid by Genzyme to
Focal prior to April 1 with respect to any underpayment, and (ii) shall be
credited and applied by Focal until exhaustion against any payments for Products
that shall become payable by Genzyme to Focal after April 1 with respect to any
overpayment. Prior to March 15th, the Collaboration Committee shall prepare and
submit to each party a written report that shall explain the calculations and
reconciliations performed by the Collaboration Committee.

             (e) COLLECTION OF DELINQUENT ACCOUNTS. Genzyme shall be responsible
for the collection of all amounts due from Third Parties resulting from the sale
of the Systems by Genzyme.

         6.8 FOCAL SHIPMENT. In accordance with guidelines established by the
Collaboration Committee, Focal shall ship the Systems pursuant to Genzyme's
written delivery instructions by a carrier mutually acceptable to the parties
C.I.P. (E. G. "Carriage and Insurance Paid To" under Incoterms 1990) to (i)
Genzyme facilities located within the Territory as reasonably designated by
Genzyme but not to exceed three (3) different locations within the Territory, or
(ii) to any number of shipping destinations within the Territory designated by
Third Parties that purchase the Systems from Genzyme as specified in the
associated purchase order. Genzyme may change the shipment destinations to its
facilities at any time by written notice to Focal. Other terms and conditions
related to System shipments, including but not limited to, the shipping
container form, minimum shipment size, import and export administration and
other details relating to order fulfillment and shipment shall be subject to
guidelines reasonably established by the Collaboration Committee. Genzyme and
Focal acknowledge the intention to bill Third Party purchasers of the Systems
for all shipping charges.

         6.9 TITLE TO THE PRODUCTS. Title to the Products sold hereunder, and
risk of loss with respect to such Products, shall pass to Genzyme upon delivery
of the Products to the carrier for shipment to the destinations designated by
Genzyme or Third Party pursuant to Section 6.8 of this Agreement. Upon the
passage of title, Focal's liability for risk of loss shall cease, and Genzyme
shall be the owner of such Products for all purposes. Except as otherwise
provided in this Agreement, the Products sold to Genzyme under this Agreement
are non-returnable, including without limitation, Systems that have become
obsolete as a result of an expired shelf life; provided, that Focal has complied
with the requirements of Section 6.13(ii) of this Agreement.

         6.10 TAXES. The party receiving any payments pursuant to this Agreement
shall pay any and all taxes levied on such payments. If laws or regulations
require that taxes be withheld on any payment, the remitting party will (i)
deduct those taxes from the payment, (ii) pay the taxes to the proper taxing

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<PAGE>

authority, and (iii) send evidence of the obligation together with proof of
payment to the other party within sixty (60) days following that payment.

         6.11 PRODUCT WARRANTY.

             (a) PRODUCT WARRANTY. All Products supplied by Focal under this
Agreement will be manufactured in accordance with the Specifications and in
accordance with QSR requirements and Regulatory Approvals. Focal warrants that
all the Products supplied by Focal under this Agreement (other than the Reusable
Products), at the time of shipment and for the shelf life of the Products when
stored and handled in accordance with the Specifications: (i) shall meet all
Specifications, (ii) shall be free from material defects in design,
construction, material and workmanship, and (iii) shall not be adulterated or
misbranded at the time of shipment. Focal warrants to Genzyme that all Reusable
Products provided to Genzyme will be free from material defects in design.

             (b) THE FOREGOING WARRANTIES ARE IN LIEU OF ALL OTHER
REPRESENTATIONS OR WARRANTIES, WHETHER EXPRESS OR IMPLIED, INCLUDING WITHOUT
LIMITATION ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE WITH RESPECT TO SUPPLY OF THE PRODUCTS HEREUNDER TO GENZYME. NO IMPLIED
WARRANTY ARISING BY USAGE, COURSE OF DEALING OR COURSE OF PERFORMANCE IS GIVEN
OR MADE BY FOCAL OR SHALL ARISE BY OR IN CONNECTION WITH ANY SALE OF THE SYSTEMS
BY GENZYME. GENZYME IS NOT AUTHORIZED TO GIVE OR MAKE ANY OTHER REPRESENTATION
OR WARRANTY OR TO MODIFY THE FOREGOING WARRANTY IN ANY MANNER.

             (c) The limited warranty set forth in this Section 6.11 does not
apply to any non-conformity of any Products resulting from (i) alteration or
repair by any party other than Focal or its agents, (ii) misuse, negligence,
abuse, accident, mishandling or storage in an improper environment by any party
other than Focal or its agents, or (iii) use, handling, storage or maintenance
by any party other than Focal or its agents other than in accordance with
instructions or recommendations provided by Focal.

             (d) Except for Genzyme's rights under Section 11.4 of this
Agreement, Focal's obligations to Genzyme with respect to Products that do not
meet the warranty contained herein is limited to replacement of such Product(s);
provided, that such Products are returned to Focal accompanied by a reasonably
detailed statement of the claimed defect or non-conformity and proof of date of
purchase, and packed and shipped according to instructions provided by Focal,
and only if, upon examination by Focal, the Products are determined to have been
defective under the terms of this Agreement. FOCAL'S LIABILITY TO GENZYME, AND
THE EXCLUSIVE REMEDY AVAILABLE TO GENZYME IN CONNECTION WITH PRODUCTS THAT FAIL
TO MEET THIS WARRANTY (WHETHER SUCH LIABILITY IS BASED ON CLAIMS ALLEGING
CONTRACT, NEGLIGENCE, BREACH OF WARRANTY, STRICT LIABILITY OR ANY OTHER LEGAL
THEORY) SHALL BE STRICTLY LIMITED TO FOCAL'S OBLIGATIONS AS SPECIFICALLY AND
EXPRESSLY SET FORTH IN THIS SECTION 6.11 AND IN SECTION 11.4 OF THIS AGREEMENT.

                                       29
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         6.12 QUALITY ASSURANCE; NONCONFORMING PRODUCTS.

             (a) INSPECTIONS. For the purpose of monitoring compliance with
QSRs, other Regulatory Authority requirements and the terms of this Agreement,
Focal and Genzyme shall each have the right on an annual basis and at such other
times as are reasonably established by the Collaboration Committee, and upon
reasonable notice and during normal business hours, to inspect (i) the
facilities used by the other party to manufacture, store and handle the
Products, and (ii) the other party's records relating to manufacture, adverse
events and complaint investigations with respect to the Products.

             (b) FAILURE TO MEET WARRANTY. Any claim by Genzyme that the
Products when shipped did not meet Specifications or the terms of the related
warranty must be made in writing to Focal within forty-five (45) days of receipt
of shipment by Genzyme if such defect is reasonably discoverable by Genzyme
within such period, or otherwise, as promptly as practicable after such defect
is discovered by Genzyme, and such writing shall indicate the specific
nonconforming characteristics of the Products. Genzyme shall have the right to
perform analytical testing on the Products. The Products which Genzyme claims
fail to meet the Specifications or the related warranty shall be returned by
Genzyme to Focal at Focal's expense, and if Focal agrees with Genzyme's claim of
nonconformance, then, at Genzyme's direction, Focal shall (i) replace as
promptly as possible such Products with Products meeting the Specifications and
warranty, and (ii) shall make such adjustment to the Purchase Minimum for the
applicable year to reflect Focal's failure or delay in supplying conforming
Products. If Focal does not agree in good faith with Genzyme's claim of
nonconformance, then the parties agree to submit the Products in question to an
independent party which has the capability of testing the Product to determine
whether or not it complies with the Specifications or warranty. In the event the
parties cannot agree upon such independent party, or in the event it is not
possible to acquire the services of such an independent party at a reasonable
cost, then such dispute shall be resolved by the Collaboration Committee, or if
the Collaboration Committee cannot resolve such dispute, then pursuant to
Section 16.5. Except as described in this Section 6.12, no shipment or portion
of a shipment of any quantity of the Products shall be returned to Focal for
replacement without Focal's prior written consent. If no claim of
non-conformance is made by Genzyme in accordance with this Section 6.12, Genzyme
shall be deemed to have accepted the Products. Notwithstanding the foregoing,
acceptance of any Product by Genzyme shall not affect Focal's obligation to
defend, indemnify and hold harmless Genzyme in accordance with Section 14 of
this Agreement.

         6.13 SPECIFICATIONS AND SYSTEM EXPIRATION. Any change in Specifications
that would materially and adversely affect the marketing of the Systems in any
country in the Territory (in Genzyme's reasonable judgment, and if Focal
disagrees, then the issue will be resolved by the Collaboration Committee or, if
necessary, pursuant to Section 16.5), except changes due to court order or
unilateral regulatory action, will require the prior review and consent of the
Collaboration Committee, which consent shall not be unreasonably withheld.
Genzyme shall be entitled to return to Focal at Focal's expense any Systems
previously accepted by Genzyme which the parties reasonably agree cannot or
should not be sold due to a failure to conform to the Specifications or to a
change in Specifications. Genzyme shall not be obligated to accept delivery of
the Systems unless (i) the Systems meet the Specifications and any related
warranty, and (ii) on the date of receipt the remaining shelf life

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          CONFIDENTIAL MATERIALS OMITTED AND FILED SEPERATELY WITH THE
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of the Systems is not less than [**] of the original shelf life of the Systems
as set forth in the Specifications.

         6.14 RESALE PRICING. As part of the Launch Plans and the Annual Sales
Plans, Focal shall provide an analysis of the factors affecting the resale
pricing of the Systems including a discussion of competitive products,
reimbursement policies and practices, current market conditions, anticipated
Manufacturing Costs and promotional and selling expenses, distribution issues,
market and economic trends and other factors that may influence the amount that
may be charged to Third Parties for the Systems, and shall include a non-binding
recommendation concerning suggested resale pricing. The Launch Plans and the
Annual Sales Plans shall include suggested resale prices for the Systems in all
relevant markets and sub-markets. Notwithstanding the suggested resale pricing
in the Plans, Genzyme shall have the right, exercisable in its sole discretion,
to establish the resale price for any System purchased from Focal under this
Agreement, and to accept any price paid by any Third Party for such System.

                                   ARTICLE 7

                               REGULATORY MATTERS

         7.1 SYSTEM AND DISTRIBUTION APPROVALS. Focal, at its sole cost and
expense, shall be responsible for preparing and submitting the MAA in each
country within the Territory and for obtaining and maintaining Regulatory
Approvals for the Systems in the Territory. Genzyme, at its sole cost and
expense, shall be responsible for seeking, obtaining and maintaining all
licenses, registrations and permits required to be obtained by Genzyme to enable
Genzyme to act as the exclusive distributor of the Systems in the Field in the
Territory pursuant to this Agreement. Each of the parties shall cooperate in
good faith with the other in making and maintaining all regulatory filings that
may be necessary or desirable in connection with the execution, delivery and
performance of this Agreement. Notwithstanding the foregoing, the parties
acknowledge that in accordance with the regulatory scheme in Mexico, it is
anticipated that the MAA will be prepared and submitted by a sub-distributor
appointed by Genzyme, and approved by the Collaboration Committee in accordance
with Section 3.1(b) of this Agreement, to promote and sell the Systems in
Mexico. Focal shall undertake to take such actions as shall be necessary or
appropriate to facilitate the efforts of such sub-distributor to attain and
maintain all Regulatory Approvals required in Mexico.

         7.2 POST MARKETING STUDIES. Focal, at its sole cost and expense, shall
be responsible for conducting all post marketing studies of the Systems required
by Regulatory Authorities as a condition to the issuance, continuation or
maintenance of a Regulatory Approval, or in connection with any other related
regulatory matter.

         7.3 COMMUNICATION WITH REGULATORY AUTHORITIES. Focal shall have
responsibility for all communications with Regulatory Authorities relating to
Regulatory Approvals for the Systems. Except as set forth above, the
Collaboration Committee shall determine from time to time which party shall have
responsibility for communications with various other government agencies and
shall divide those responsibilities as it sees fit. Each party shall promptly
advise the other party of material developments and events relating to its
respective regulatory responsibilities.

                                       31
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         7.4 GOVERNMENTAL INSPECTIONS. Each party shall advise the other party
of any governmental visits to, or written or oral inquires about, any facilities
or procedures for the manufacture, storage, or handling of the Systems, or the
marketing, selling, promotion or distribution of the Systems promptly (but in no
event later than two (2) business days) after notice of such visit or inquiry.
Each party shall furnish to the other party any report or correspondence issued
by or provided to the governmental authority in connection with such visit or
inquiry.

         7.5 SYSTEM COMPLAINTS. Focal shall have responsibility for maintaining
System complaint information and the assessment and submission of appropriate
reports to the relevant Regulatory Authorities in accordance with applicable
regulatory requirements. If at any time either party (the "Notifying Party")
receives notice of a System complaint (which shall mean any written, electronic
or oral communication that alleges deficiencies related to the identity,
quality, durability, reliability, safety, effectiveness or performance of the
Systems), the Notifying Party shall notify the other party (the "Notified
Party") in a timely manner (which, in the case of a notification by Genzyme,
shall not be later three (3) days), by telephone, confirmed in writing, to the
person designated as the Notified Party's contact for such purposes. In addition
to the foregoing, the parties shall develop mutually acceptable guidelines and
procedures to govern the sharing of System complaint information. Upon request
from Genzyme, Focal shall provide summary information to Genzyme in such detail
as Focal shall determine is appropriate regarding System complaints that have
occurred world-wide with respect to the Systems to the extent Focal is able to
assemble such information and to the extent permitted by applicable law or
regulation and other agreements with Third Parties.

         7.6 POST MARKETING SURVEILLANCE. Focal, at its sole cost and expense,
shall have the responsibility of conducting Post Marketing Surveillance ("PMS")
for the Systems sold by Genzyme in the Territory. Genzyme shall fully cooperate
with Focal in its efforts to conduct PMS and will provide to Focal such
assistance as may be necessary for Focal to fully satisfy its PMS obligations,
including the collection of System related information and the preparation of
reports with respect to such information. The scope and details of such
cooperation by Genzyme shall be mutually agreed upon by the parties.

         7.7 SYSTEM RECALLS. Focal, with the advice of Genzyme, shall prepare
and maintain a written Standard Operating Procedure ("SOP") to handle any
recalls of the Systems in the Territory. In the event that (i) any governmental
agency or authority issues a request or directive or orders that the Systems be
recalled or retrieved; (ii) a court of competent jurisdiction orders that the
Systems be recalled or retrieved; or (iii) Focal and Genzyme reasonably and
mutually determine, after consultation, that the Systems should be recalled,
retrieved or a "dear doctor" letter is required relating to restrictions on use
of the Systems, then Focal shall conduct such activity and the parties shall
take all appropriate corrective actions and shall execute the steps detailed in
the SOP; provided, that in the event that Focal and Genzyme are not able to
agree on the course of action to be taken, the final determination of the
appropriate course of action shall be made by Focal. In the event such action
results from the breach of Focal's warranties or covenants under this Agreement
or from side effects alleged to be caused in whole or in part by the Systems, or
Focal's (or Focal's agent's) negligence or willful misconduct, Focal shall, in
addition to any obligations under Section 14.2 and Section 6.11, be responsible
for the expenses thereof. In the event such action results from Genzyme's
negligence or willful misconduct, Genzyme shall, in addition to any obligations
under Section 14.1, be responsible for the expenses thereof. In all other
circumstances where neither the actions or omissions of Focal nor Genzyme is
responsible for the System recall or other activity agreed upon by the parties,
Focal and Genzyme shall share equally the expenses of notification and System
return, and the costs of destruction, repair or replacement and

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          CONFIDENTIAL MATERIALS OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.

distribution of System as authorized by Focal or required by the applicable
Regulatory Authorities. Genzyme and Focal shall cooperate fully with one another
in conducting any such action and shall use their respective reasonable efforts,
consistent with normal business practice, to minimize the cost of such action.
Genzyme shall destroy Systems lawfully recalled only upon Focal's (or any
governmental authority's) written instruction to destroy such Systems.
Otherwise, Genzyme may return the recalled Systems to Focal within thirty (30)
days after completion of the action.

                                   ARTICLE 8

                OWNERSHIP, CONFIDENTIALITY AND PUBLIC INFORMATION

         8.1 OWNERSHIP. Nothing herein shall be interpreted or construed to
grant to Genzyme any rights or interest in the Focal Patent Rights, Trademarks,
Technology or other business or commercial rights associated with the Products
(other than the distribution and manufacturing rights for the Systems and the
license rights to the Trademarks granted hereunder) owned by Focal or to which
Focal is otherwise entitled under this Agreement or otherwise.

         8.2 USE OF NON-CLINICAL AND CLINICAL DATA. Focal agrees to provide
Genzyme with data relevant to the promotion and sale of the Systems for use in
the Field in the Territory derived from any non-clinical and clinical studies of
the Systems obtained in connection with Research and Development for which
disclosure is not otherwise barred by contract, and shall permit Genzyme to use
it for the promotion of the Systems in the Territory.

         8.3 CONFIDENTIALITY. Each party agrees that all Proprietary Information
it obtains from the other is the confidential property of the disclosing party.
Except as expressly allowed in this Agreement and except for disclosures made in
connection with regulatory matters or as otherwise required by law (provided
that the parties shall confer in advance and mutually agree on the extent of
such disclosures), the receiving party for a period ending five (5) years from
the date of expiration or termination of this Agreement shall hold in confidence
and not use or disclose any Proprietary Information of the disclosing party and
shall similarly bind its employees in writing. The receiving party shall not be
obligated under this Section 8.3 with respect to information the receiving party
can document:

             (i) is or has become publicly available through no fault of the
receiving party or its employees or agents;

             (ii) is received from a Third Party lawfully in possession of such
information and lawfully empowered to disclose such information and provided the
receiving party abides by all restrictions imposed by such Third Party;

             (iii) was rightfully in the possession of the receiving party prior
to its disclosure by the other party provided the receiving party abides by all
restrictions imposed on its possession of such information; or

             (iv) is or was developed independently of the information provided
by the disclosing party.

         8.4 COVENANT NOT TO COMPETE. During the term of this Agreement, [**]
year after the expiration of this Agreement or the termination of this
Agreement by Focal pursuant to Section 11.3

                                       33
<PAGE>

or Section 11.5 of this Agreement, Genzyme agrees that it will not directly or
indirectly distribute, market or sell in the Territory any products which
directly compete with the Systems in the Field for uses that are included within
the Regulatory Approval(s) for the Systems, except that Genzyme may promote,
market and sell in the Territory (i) products of any kind whatsoever (including
drugs or devices) to produce hemostasis by accelerating the clotting process of
blood, and (ii) other products that may be distributed, marketed or sold for use
in the Field in procedures that may involve surgical repair so long as the
promotion, advertising and sale of such products does not materially interfere
with the promotion, marketing and sale of the Systems in the Territory as
reasonably determined by the Collaboration Committee. The Collaboration
Committee shall be responsible for determining if a product competes, or has the
potential to compete, with the Systems during the term of this Agreement;
thereafter, the parties shall mutually agree upon the competitiveness of any
product. If, at any time, Genzyme requests a waiver, exception or release from
the restrictions of this covenant, Focal agrees that it will consider, and it
will act upon, such request in good faith; provided, that Focal shall be under
no obligation to satisfy any such request.

         8.5 PUBLIC DISCLOSURES.

             (a) Focal and Genzyme shall agree on the timing, content and form
of the initial press release announcing this transaction to be issued by each
party, or jointly, as the parties may agree; provided, that the initial press
release shall be issued within one (1) business day after the Effective Date.

             (b) Focal and Genzyme may disclose the terms and conditions of this
Agreement to the extent that such disclosure is required by law, including
without limitation the securities and antitrust laws of the United States. The
parties acknowledge and agree that the determination that a disclosure is
required by law shall be made in the sole, but reasonably exercised, discretion
of the party making such disclosure.

             (c) If reasonably required in connection with the conduct of their
respective businesses, Focal and Genzyme may disclose the existence or terms of
this Agreement to bankers, other business associates and potential investors if
such persons have agreed in writing to keep the information confidential. Upon
the request of either party, the other party shall identify those Third Parties
to whom such disclosure has been made.

         8.6 PUBLICATIONS. Focal and Genzyme shall not submit for written or
oral publication any manuscript, abstract or the like which includes data or
other information related to the Systems that may materially and adversely
effect the promotion, marketing and sale of the Systems in the Territory without
providing in advance to the Collaboration Committee a copy of such submission
for review and comment. With respect to a manuscript, the manuscript shall be
provided by Focal or Genzyme to the Collaboration Committee a minimum of thirty
(30) days in advance, and with respect to an abstract, the abstract shall be
provided by Focal or Genzyme to the Collaboration Committee a minimum of
fourteen (14) days in advance. It is specifically understood that neither Focal
nor Genzyme has control of any publication made by Third Party physicians unless
such publication is based on data supplied by Focal or Genzyme.

         8.7 OTHER PARTIES. Notwithstanding anything to the contrary contained
in this Agreement, Focal and Genzyme shall use reasonable efforts to each cause
any of its Affiliates and any Third Party

                                       34
<PAGE>

contractors, scientists and other persons working with them who may have access
to Proprietary Information, or who may be in a position to publish on matters
relevant to this Agreement, to enter into one or more agreements with such
persons to cause them to be bound by the confidentiality and publication
restrictions of this Article 8.

                                   ARTICLE 9

                                   TRADEMARKS

         9.1 TRADEMARK REGISTRATION. The Trademarks for the Products will be
owned by Focal, and shall be registered and maintained by Focal at its sole
expense. Focal represents that the registration of the Focal -Registered
Trademark- and FocalSeal -Registered Trademark- Trademarks and the Trademark
depicting the Company's tear drop logo (each as prepared by Focal to be used
with the Systems) has been granted, or has been applied for and is pending,
in each of the countries of the Territory, as of the Effective Date. Focal
agrees to continue to use its best efforts to pursue registration of the
Trademarks, including any other trademarks proposed by Focal to be used with
the Systems after the Effective Date in each of the countries of the
Territory where such Trademarks are pending. In the event the Trademarks are
not available in any country in the Territory, Focal shall develop new
trademarks for identifying the Systems in such country. In accordance with
Focal's guidelines, Genzyme shall utilize the Trademarks in connection with
the commercialization of the Systems, including without limitation, all
product packaging and promotional materials. Genzyme shall be permitted to
use its own trademarks in combination with the Trademarks, and with respect
to each such joint use, the Genzyme trademarks and the Trademarks shall be
displayed with equal prominence on the article, package or promotional
material. Genzyme shall submit exemplars of all packaging, promotional or
advertising material which includes the proposed form of use of the
Trademarks, including any Genzyme trademarks to be employed with the
Trademarks, to Focal for prior review and approval, which approval shall not
be unreasonably withheld or delayed. Focal shall be identified as the owner
of its Trademarks on all Genzyme packaging and promotional material. Genzyme
agrees to cooperate with Focal at Focal's expense to pursue and maintain
Trademark registrations in the Territory.

         9.2 NO RIGHTS IN TRADEMARKS, TRADE NAMES, LOGOS OR DESIGNATIONS. Each
of Genzyme and Focal acknowledges that it has paid no consideration for the use
of the trademarks, trade names, logos and designations belong to the other
party, and except as described in this Agreement, nothing contained in this
Agreement shall give Genzyme or Focal any right, title or interest in or to any
of the trademarks, trade names, logos or designations belong to the other party.
Each of Genzyme and Focal acknowledges that the other party owns and retains all
proprietary rights in trademarks, trade names, logos and designations belonging
to the other party, and agrees that it will not at any time during or after the
term of this Agreement assert or claim any interest or do anything that might
adversely affect the validity or enforceability of any trademark, trade names,
logo or designations belonging to the other party. Each of Genzyme and Focal
agrees that it will not affix any trademarks belonging to the other party to any
product other than the Systems, and agrees that it will use the trademark
belonging to the other party solely in connection with the Systems.

         9.3 TRADEMARKS AFTER TERMINATION OR EXPIRATION. Upon expiration or
termination of this Agreement, Genzyme and Focal will each cease all display,
advertising and use of the trademarks, trade names, logos and designations of
the other party, and Genzyme will not thereafter use, advertise or display any
name, mark or logo that is, or any part of which is, similar to any such
designation

                                       35
<PAGE>

associated with the Systems, except to the extent necessary for Genzyme to sell
any Systems remaining in its inventory after termination of this Agreement in
accordance with Section 12.3 of this Agreement; provided, further, that the use
of the Trademarks, trade names, logos and designations by Genzyme after
expiration or termination is otherwise in accordance with this Agreement.

                                   ARTICLE 10

               PATENT AND TRADEMARK INDEMNIFICATION AND LITIGATION

         10.1 PATENT AND TRADEMARK INDEMNITY. If Genzyme receives written notice
of a claim that any of the Products, Systems or Trademarks infringe upon a
patent, trademark or other intellectual property rights of a Third Party in the
Territory, or Genzyme becomes aware of a Third Party threat to sue or bring an
action for intellectual property infringement in the Territory, or if Genzyme
becomes aware of Third Party intellectual property rights in the Territory that
may give rise to a claim of infringement, Genzyme will notify Focal promptly in
writing and give Focal all necessary information and assistance. Focal shall
have the exclusive authority to evaluate, defend and settle any such claim as it
deems appropriate. Focal, at its own expense and option, may then (i) settle or
defend against such claim, (ii) procure ownership of or a license to the rights
alleged to be infringed, (iii) replace or modify the Products or Systems to
avoid infringement, provided, that Focal shall use reasonable commercial efforts
to assure that such replacements or modifications do not materially affect the
sales prospects of the Systems, (iv) require Genzyme to recall the Systems from
the Territory after consideration and consultation with Genzyme of the actions
described in the preceding clauses (i), (ii) and (iii), or (v) do any
combination of the foregoing; provided, however, that Focal hereby agrees to use
reasonable efforts to minimize the impact of its actions on Genzyme's ability to
market, sell and distribute the Systems. Provided such timely notice has been
given by Genzyme, Focal shall fully indemnify Genzyme from any expenses, costs
or losses resulting from such infringement in accordance with Section 14.2;
provided, however, that failure by Genzyme to provide timely notice shall
relieve Focal of its obligation to Genzyme under this Section 10.1 only to the
extent that such failure materially prejudices Focal's ability to defend such
action. Notwithstanding any decision by Focal to take one or more of the actions
described above, if a claim that any of the Products, Systems or Trademarks
infringe upon a patent, trademark or other intellectual property rights of a
Third Party materially and adversely affects Genzyme's distribution of the
Systems in the Territory, Genzyme shall be relieved of its obligation to satisfy
the Purchase Minimums in an amount reasonably determined to be attributable to
such claim.

         10.2 LIMITATION OF INDEMNITY. The indemnity in Section 10.1 shall not
apply to (i) any claim arising out of a modification by Genzyme of the Products
or Systems after delivery by Focal, (ii) any infringement occurring after (a)
Genzyme has been offered the opportunity to discuss with Focal the alleged
infringement of, and Genzyme has received notice from Focal to terminate the
promotion or sale of, Systems that include, in Focal's reasonable judgment, the
Product or System which is the subject of the infringement, and (b) Genzyme does
not, in a commercially reasonable period of time, terminate such promotion or
sale, (iii) Genzyme's use of the Systems after Focal has informed Genzyme of
modifications or changes in the Products or Systems required to avoid such
claims (which modifications or changes do not materially affect the sales
prospects of the Systems) and Focal has offered to implement those modifications
or changes, if such claim would have been avoided by implementation thereof, and
Genzyme fails to have such modifications or changes implemented, (iv) any claim
is found to be based upon the recklessness or willful action or inaction of
Genzyme, (v) any claim if Genzyme fails to give Focal reasonably prompt notice
of such claim to the extent such failure materially

                                       36
<PAGE>

prejudices Focal, (vi) any claims of infringement of any patent, copyright or
trade secrets in which Genzyme or its Affiliates has an interest or license, or
(vii) the settlement of any claim if Focal is not given the prior opportunity to
approve in writing such settlement.

         10.3 INFRINGEMENT BY THIRD PARTIES. Focal shall have the sole right and
option, at its sole and absolute discretion, to file and maintain lawsuits in
its own name for infringement by Third Parties of any Patent Rights, Trademarks
or other proprietary rights relating to the Products or Systems that occur
within the Territory. Genzyme shall, at the request and expense of Focal, give
Focal all reasonable assistance and cooperation in any such proceedings at
Focal's expense. Notwithstanding any decision or action by Focal arising out of
any Third Party infringement, or the results or outcomes thereof, Genzyme's
obligation to make payments to Focal under this Agreement shall be unaffected
and, in the event that Genzyme's distribution of the Systems is adversely
affected by such Third Party infringement, Focal shall not be obligated to
offset any payments made hereunder. Notwithstanding any decision on the part of
Focal to forgo bringing or continuing to prosecute any suit, claim or
litigation, even if permitted under law, Genzyme shall not have the right to
bring, file or litigate any claim for infringement by Third Parties of any
proprietary rights held by Focal occurring in the Territory without Focal's
prior written consent, which consent shall not be unreasonably withheld. If such
consent is granted, Focal shall cooperate with Genzyme, and shall assign to
Genzyme such rights as are reasonably determined by Focal to be necessary to
bring, file or litigate such claim. Any recovery realized by either party as a
result of any infringement litigation pursuant to this Section 10.3 (whether by
way of settlement or otherwise) shall be first allocated to reimbursement of
legal fees and expenses incurred by the party initiating the proceeding, then,
if applicable, toward reimbursement of the other party's legal fees and
expenses, and then the remainder shall be divided between the parties as
follows: seventy-five percent (75%) to the party initiating such proceedings and
twenty-five percent (25%) to the other party.

         10.4 THIRD PARTY LICENSE AGREEMENTS.

             (a) Focal shall, at its own expense, take all such actions and
shall participate in such proceedings as shall be reasonably necessary to ensure
that Focal's rights under any agreements with Third Parties pursuant to which
Focal has in-licensed Focal Patent Rights or Scientific Know-How ("Third Party
License Agreements"), shall remain in full force and effect. If Focal fails to
take any such actions and participate in such proceedings and the Collaboration
Committee determines that such Third Party License Agreement is material to the
development and commercialization of any Product or System in the Field in the
Territory, then Genzyme shall have the right to require that Focal take, and
Focal agrees to use its reasonable best efforts to take, all such actions as
Genzyme shall reasonably deem necessary or desirable to ensure that such Third
Party License Agreements remain in force and effect and that Focal's rights
under such Third Party License Agreements remain in full force and effect,
including, but not limited to, the execution and filing of any court-related
filings and documents, the pursuit of injunctive proceedings, and the taking of
any other similar measures.

             (b) Focal shall, within five business days after notice thereof,
provide written notice to Genzyme of any challenges or claims with respect to
any Third Party License Agreements, or alleged breaches under any Third Party
License Agreements.

             (c) Focal shall not allow or agree to any amendment, waiver or
modification to any Third Party License Agreements, which amendment, waiver or
modification restricts, modifies or limits in any way Genzyme's rights under
this Agreement, without the prior written consent of Genzyme.

                                       37
<PAGE>

          CONFIDENTIAL MATERIALS OMITTED AND FILED SEPERATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.

                                   ARTICLE 11

                              TERM AND TERMINATION

         11.1 INITIAL TERM. This Agreement shall commence as of the Effective
Date and, unless otherwise earlier terminated pursuant to this Article 11,
this Agreement shall expire on that date which is [**] after the date the
FocalSeal -Registered Trademark- -L System receives Regulatory Approval in
the United States (the "Initial Term").

         11.2 EXTENSION TERM. The term of this Agreement may be extended (i)
by Genzyme, at its option, for up to [**] successive [**] periods (each [**]
period, an "Extension Term") if Genzyme satisfies the Purchase Minimums
during the last two full calendar years of the Initial Term or any Extension
Term immediately preceding such renewal, as applicable, by providing written
notice to Focal of such election not later than six (6) months prior to the
expiration of the Initial Term or any Extension Term, as the case may be, or
(ii) by Focal and Genzyme, jointly, for up to three successive Extension
Terms by joining in a written confirmation of such election not later than
six (6) months prior to the expiration of the Initial Term or any Extension
Term, as the case may be.

         11.3 TERMINATION BY EITHER PARTY. This Agreement may be terminated
unilaterally by either party upon written notice to the other party in the event
of any of the following:

             (a) nonpayment of all or any portion of any properly due and
payable amount that is (i) continuing for twenty (20) business days after the
defaulting party has received notice from the non- defaulting party of such
nonpayment, and (ii) not the subject of a good faith dispute between the
parties, in which case such dispute shall be resolved pursuant to the terms of
Section 16.5 of this Agreement;

             (b) material breach by the other party of any provision herein
(other than as specified in Sections 11.3(a), 11.4 and 11.5 of this Agreement)
and (i) for a breach that can be reasonably cured within thirty (30) days, such
breach is continuing thirty (30) days after the non-defaulting party gives the
defaulting party notice of such breach specifying in reasonable detail the
particulars of the alleged breach, or (ii) for a breach that by its nature can
not be reasonably cured by the defaulting party within thirty (30) days, such
breach is continuing and either (x) no material steps have been taken by the
defaulting party to cure such breach during the thirty (30) day period following
receipt of the non-defaulting party's notice, or (y) the breach has not been
cured within a reasonable period of time as determined by the non-defaulting
party, which period shall in no event be longer than ninety (90) days;

             (c) the other party becomes insolvent, or voluntary or involuntary
proceedings are instituted by or against the other party, which proceedings are
not stayed or dismissed against the party within thirty (30) days, or a receiver
or custodian is appointed for such party's business, or a substantial portion of
such party's business is subject to attachment or similar process, or the other
party is unable to satisfy its financial obligations as they become due, enters
into any compromise or arrangement with its creditors or enters into
liquidation;

             (d) upon sixty (60) days prior written notice if a force majeure
event (as described in Section 16.1 of this Agreement) excusing non-performance
hereunder continues for a period of three (3) consecutive months;

                                       38
<PAGE>

             (e) upon sixty (60) days prior written notice upon the occurrence
of any event under Section 16.6(a) of this Agreement.

             (f) upon prior written notice provided on or before March 1,
2002 in the event that Regulatory Approval of the FocalSeal -Registered
Trademark- -S System in the United States is not received on or before
December 31, 2001.

         11.4 TERMINATION BY GENZYME. Genzyme may terminate this Agreement upon
thirty (30) days written notice to Focal in the event that:

             (a) there is a material change in the frequency or severity of
adverse System-related events or there is a recall of any System for any reason
related to safety, which events require additional or modified warnings in
System labeling, and as a result the distribution of the Systems is
significantly and adversely affected during each of three (3) consecutive months
as determined in good faith by Genzyme;

             (b) Genzyme is prohibited from selling any System in the United
States as a result of the denial of any required governmental approval, or as a
result of a court decision (or the receipt of a legal opinion from counsel
reasonably acceptable to both parties) that such System infringes upon a Third
Party's patent, trademark or other intellectual property rights;

             (c) Focal fails to meet the supply minimums established in Section
5.4 and (i) no force majeure condition existed that had a material adverse
effect on Focal's ability to meet such supply minimums, and (ii) after Genzyme
has given proper notice to Focal pursuant to Section 5.4, Focal has not cured
such deficiencies in accordance with Section 5.4; or

             (d) If a Performance Suspension Event (as defined herein) has
occurred.

         11.5 TERMINATION BY FOCAL. Focal may terminate this Agreement in the
event that:

             (a) if, notwithstanding the satisfaction by Focal of all conditions
to Genzyme's obligations to purchase Shares pursuant to the Stock Purchase
Agreement dated as of the date hereof between the parties (the "Stock Purchase
Agreement"), Genzyme fails to purchase all or any portion of such Shares
required to be purchased by Genzyme at any Closing pursuant to the Stock
Purchase Agreement and such failure is continuing thirty (30) days after the
receipt by Genzyme of written notice to such effect. The term "Shares" and
"Closing" shall be as defined in the Stock Purchase Agreement.

             (b) Genzyme does not actively commence the promotion, marketing
and sale of the FocalSeal -Registered Trademark- -L System in accordance with
this Agreement within ninety (90) days after the date the FocalSeal
-Registered Trademark- -L System receives Regulatory Approval in the United
States; provided, that Focal furnishes a notice of termination within thirty
(30) days after the end of such ninety (90) day period; or

             (c) Genzyme fails to satisfy a Tier I Purchase Minimum for three
(3) consecutive calendar quarters or fails to satisfy a Tier II Purchase Minimum
for any calendar quarter, and (i) no force majeure condition existed that had a
material adverse effect on Genzyme's ability to meet such Purchase Minimums;
(ii) Focal met its supply obligations under this Agreement in all material
respects during the affected period and for 60 days immediately prior to such
affected period, (iii) no recall or other Regulatory Authority action occurred
that had a material adverse effect on Genzyme's ability to meet

                                       39
<PAGE>

such Purchase Minimums; (iv) no claim of infringement by a Third Party with
respect to any Products had a material adverse effect on Genzyme's ability to
meet such Purchase Minimums; (v) Genzyme was able to lawfully sell all of the
Systems for use in the Field in the Territory during the affected period and for
90 days immediately prior to such affected period; or (vi) Genzyme has not cured
the failure in accordance with, and to the extent permitted by, Section 6.4 of
this Agreement; and, provided further, that Focal furnishes a notice of
termination prior to the later of (x) sixty (60) days after such failure occurs,
or (ii) sixty (60) days after Genzyme's failure to successfully cure a Purchase
Minimum deficiency after giving notice of its intent to do so under Section 6.4
of this Agreement.

         11.6 TERMINATION BY FOCAL AND GENZYME. Focal and Genzyme may elect at
any time to terminate this Agreement upon mutual written agreement.

                                   ARTICLE 12

                 RIGHTS AND DUTIES UPON TERMINATION OR EXPIRATION

         12.1 MONIES PAID OR DUE. Upon the termination of this Agreement prior
to its expiration under Article 11 of this Agreement, Focal shall have the right
to retain all payments received from Genzyme pursuant to this Agreement, and
each party shall pay to the other all sums accrued hereunder which are then due.

         12.2 TERMINATION OF DISTRIBUTION RIGHTS. Subject to Section 12.3, upon
expiration or termination of this Agreement, Genzyme's rights to market and sell
the Systems in the Territory shall immediately terminate. Upon such expiration
or termination, all promotional materials related to Systems that contain
Genzyme's name shall no longer be used to promote, market and sell the Systems.

         12.3 REMAINING SYSTEMS. Upon expiration or termination of this
Agreement, Genzyme shall notify Focal of the amounts of the Systems that Genzyme
then has on hand, and Focal, in its sole discretion, with respect to all or any
specified portion of such amounts, may, within twenty (20) days after the
receipt of such notice, elect (i) to permit Genzyme and its sub-distributors to
sell the remaining amounts of the Systems for a period following the expiration
or termination of this Agreement not to exceed eighteen (18) months, (ii) to
repurchase the Systems from Genzyme at the actual Purchase Price paid by Genzyme
for the Systems, or (iii) to do a combination of the foregoing; provided,
however, in the event of termination by Genzyme pursuant to Sections 11.3 or
11.4, the foregoing election shall be made by Genzyme. In the event that either
party elects the option set forth in clause (i) above, Focal and Genzyme shall
cooperate to market and sell the Systems, and Focal shall have no obligation to
accept from Genzyme the amounts of the Systems that Genzyme has on hand at the
end of the post-termination sale period.

         12.4 TRANSFER OF APPROVALS AND TRANSITION ASSISTANCE.

             (a) Upon expiration or termination of this Agreement, Genzyme shall
take such reasonable steps as shall be required to cause the transfer to Focal
(or Focal's designated Affiliate) of any Regulatory Approvals, if any, issued in
the name of Genzyme or a Genzyme Affiliate, to the extent permitted by
applicable law and to the extent they are transferable pursuant to the terms
thereof. Any out-of-pocket fees and similar expenses incurred by Genzyme to
effect such transfer shall be borne by Focal.

                                       40
<PAGE>

             (b) Upon expiration of this Agreement or termination of this
Agreement pursuant to Section 11.3, 11.4 or 11.5 herein, Genzyme shall, at
Focal's cost and expense, render commercially reasonable assistance to
facilitate the transition to Focal of those promotional, marketing, sales and
sales administration activities performed by Genzyme under this Agreement.
Genzyme shall undertake to help Focal effect such transition efficiently and
quickly, and will provide to Focal, or its designees, such records and
information relating to this Agreement that does not constitute Genzyme
Proprietary Information; provided that, Genzyme shall permit Focal to retain and
use the Genzyme Proprietary Information set forth in Section 4.2(c)(iii) unless
such termination is pursuant to a material breach by Focal pursuant to Section
11.3(a), (b) or (c) or 11.4(d) of the Agreement. In addition, Genzyme shall
execute and deliver any agreements, notices, assignments and other instruments
mutually agree upon by Genzyme and Focal to be necessary to consummate such
transition.

         12.5 SURVIVAL OF RIGHTS. Upon expiration or termination of this
Agreement, all rights and obligations of the parties under this Agreement shall
terminate, except those described in the following Articles:

<TABLE>
<CAPTION>
                  ARTICLE           SURVIVING SECTIONS
                  -------           ------------------
                  <S>               <C>
                  Article 6         Section 6.11
                  Article 8         All Sections
                  Article 9         Section 9.3
                  Article 10        All Sections (except Section 10.4)
                  Article 12        All Sections
                  Article 13        All Sections
                  Article 14        All Sections
</TABLE>

         In addition, any other provision which by its terms is stated to
survive this Agreement, and any other provision required to interpret and
enforce the parties' rights and obligations under this Agreement (including
without limitation Article 1 Definitions and Article 16 - Miscellaneous), shall
survive to the extent required for the full observation and performance of this
Agreement by the parties hereto.

         12.6 RIGHTS NOT EXCLUSIVE. All rights to terminate, and rights upon
termination, provided to either party in this Agreement are in addition to other
remedies in law or equity which may be available to either party, including
without limitation, and notwithstanding any other provision of this Agreement,
the right of either party to seek the return of any monies paid to the other
party under this Agreement.

                                   ARTICLE 13

                    REPRESENTATIONS AND WARRANTIES; COVENANTS

         13.1 AUTHORIZATION. Focal and Genzyme each represents and warrants to
the other that (i) it has the legal authority and right to enter into and
perform this Agreement, (ii) this Agreement has been duly executed and delivered
and is a valid and binding agreement enforceable against such party in
accordance with its terms, (iii) no authorization, consent or approval of, or
any filing or registration with, any governmental authority or regulatory body
(other than as contemplated by this Agreement) or Third Party is required for
the execution, delivery and performance of this Agreement by such party, (iv)
the execution, delivery and performance of this Agreement will not conflict in
any material fashion with the terms of any other agreement to which it is or
becomes a party or by which it is or becomes bound,

                                       41
<PAGE>

and (v) each Party has not made and will not make any commitments to others in
conflict with or in derogation of the rights conferred to the other party under
this Agreement.

         13.2 INTELLECTUAL PROPERTY RIGHTS. Focal hereby represents and warrants
that, as of the Effective Date, (i) Focal possesses the right, title and
interest in or to, or has exclusive licence rights to (with the right to
sublicense) the Focal Patent Rights and the Technology, (ii) the Focal Patent
Rights and the Technology are free and clear of any lien or other encumbrance
that would interfere with the rights granted to Genzyme pursuant to this
Agreement or interfere with the promotion, marketing and sale of the Systems in
the Territory, and (iii) Focal is not aware of any valid patent, trade secret or
similar proprietary rights of a Third Party in the Territory that would be
infringed or misappropriated by the promotion, distribution or sale of the
Systems by Genzyme, or by the use of the Systems by Third Parties that purchase
the Systems from Genzyme.

         13.3 COMPLIANCE WITH APPLICABLE LAWS. Focal and Genzyme each covenants
to the other that it will comply fully with all laws applicable to it and its
activities under this Agreement.

                                   ARTICLE 14

             INDEMNIFICATION, LIMITATION OF LIABILITY AND INSURANCE

         14.1 INDEMNIFICATION BY GENZYME. Genzyme shall indemnify, defend and
hold harmless Focal and its Affiliates, employees, officers and directors, and
each of their respective successors and assigns (each, a "Focal Indemnified
Party") from and against any and all liability, loss, damage, cost, and expense
(including reasonable attorneys' fees), subject to the limitations in Section
14.5 (collectively, a "Liability"), which the Focal Indemnified Party may incur,
suffer or be required to pay resulting from or arising in connection with a
claim by a Third Party relating to (a) the breach by Genzyme of any covenant,
representation or warranty contained in this Agreement, (b) any negligent or
willful act or omission by Genzyme in connection with Genzyme's manufacture,
promotion, marketing, distribution or sale of the Systems, or (c) interactions
and communications by Genzyme with governmental authorities in connection with
such promotion and advertising.

         14.2 INDEMNIFICATION BY FOCAL. Focal shall indemnify, defend and hold
harmless Genzyme and its Affiliates, employees, officers and directors, and each
of their respective successors and assigns (each, a "Genzyme Indemnified Party")
from and against any and all Liability, which the Genzyme Indemnified Party may
incur, suffer or be required to pay resulting from or arising in connection with
a claim by a Third Party relating to (i) the breach by Focal of any covenant,
representation or warranty contained in this Agreement, (ii) the development,
manufacture, promotion or marketing of the Systems or any other activity
conducted by Focal under this Agreement which is or is alleged to be the
proximate cause of injury, death or property damage to a Third Party, (iii) any
negligent or willful act or omission by Focal in connection with the promotion
and advertising of the Systems, or (iv) interactions and communications by Focal
with governmental authorities in connection with such promotion and advertising.

         14.3 CONDITIONS TO INDEMNIFICATION. The obligations of the indemnifying
party under Sections 14.1 and 14.2 are conditioned upon the delivery of written
notice to the indemnifying party of any potential Liability promptly after the
Indemnified Party receives written notice of such potential Liability. The
indemnifying party shall have the right to assume the defense of any suit or
claim related

                                       42
<PAGE>

to the Liability if it has assumed responsibility for the suit or claim in
writing; however, if in the reasonable judgment of the Indemnified Party such
suit or claim involves an issue or matter which could have a materially adverse
effect on the business, operations or assets of the Indemnified Party, the
Indemnified Party may waive its rights to indemnity under this Agreement and
control the defense or settlement thereof, provided, that such waiver shall
constitute a waiver of any indemnification rights such Indemnified Party may
assert at law or in equity against the indemnifying party. If the indemnifying
party defends the suit or claim, the Indemnified Party may participate in (but
not control) the defense thereof at its sole cost and expense.

         14.4 SETTLEMENTS. Neither party may settle a claim or action related to
a Liability without the consent of the other party, if such settlement would
impose any monetary obligation on the other party or require the other party to
submit to an injunction. Any payment made by a party to settle any such claim or
action shall be at its own cost and expense.

         14.5 LIMITATION OF LIABILITY. FOCAL AND GENZYME AGREE THAT NO PARTY
SHALL BE LIABLE TO ANOTHER PARTY FOR ANY SPECIAL, CONSEQUENTIAL, EXEMPLARY OR
INCIDENTAL DAMAGES (INCLUDING LOST OR ANTICIPATED REVENUES OR PROFITS RELATING
TO THE SAME), ARISING FROM ANY CLAIM RELATING TO THE PRODUCTS OR UNDER THIS
AGREEMENT, WHETHER SUCH CLAIM IS BASED ON CONTRACT, TORT (INCLUDING NEGLIGENCE)
OR OTHERWISE, EVEN IF AN AUTHORIZED REPRESENTATIVE OF SUCH PARTY IS ADVISED OF
THE POSSIBILITY OR LIKELIHOOD OF SUCH RECOVERY.

         14.6 INSURANCE.

             (a) Genzyme and Focal shall each maintain at their own cost product
liability, comprehensive general liability, property and transit insurance
coverage in amounts reasonably determined by the Collaboration Committee from
time to time from a reputable insurance carrier (or by means of self-insurance
if approved by the Collaboration Committee). The insurance obtained by each
party shall (a) name the other party (including their respective officers,
directors, employees, Affiliates, agents, successors and assigns) as additional
insureds with respect to matters arising from this Agreement, and (b) provide
that underwriters and insurance companies of the insured may not have any right
of subrogation against the other party (including its respective officers,
directors, employees, servants, Affiliates, agents, successors and assigns),
except in the event a claim results from Genzyme or Focal's respective gross
negligence or willful misconduct.

             (b) Upon reasonable advance request, each Party shall furnish the
other Party with one or more certificates from a reputable insurance carrier
showing all insurance obtained in accordance with this Section. The certificates
shall include the following statement: "The insurance certified hereunder is
applicable to all contracts between [Focal] [Genzyme] and the Insured. This
insurance may be canceled or altered only after ten (10) days' written notice to
[Genzyme] [Focal] and the Insured."

             (c) The Collaboration Committee shall review the adequacy of the
insurance described above on an annual basis and the Collaboration Committee
shall have the authority to reasonably direct the modification of such
insurance.

                                       43
<PAGE>

                                   ARTICLE 15

                              IMPROVEMENT PRODUCTS

         15.1 IMPROVEMENT PRODUCTS. Any Improvement Products developed by Focal
shall be subject to the terms and conditions of this Agreement, including
without limitation, the authority of the Collaboration Committee. To the extent
the promotion, marketing and sale of Improvement Products is inconsistent with
the specific terms and conditions of this Agreement or the overall scheme of the
arrangement contemplated by this Agreement, the parties agree to modify and
conform this Agreement on terms and conditions mutually acceptable to the
parties. If the Collaboration Committee is unable to reach agreement on any
matter related to the integration of Improvement Products into this Agreement,
such dispute shall be resolved in accordance with Section 16.5 of this
Agreement.

                                   ARTICLE 16

                                  MISCELLANEOUS

         16.1 FORCE MAJEURE; OTHER EVENTS.

             (a) If the performance (other than payment obligations) of any part
of this Agreement by either party is prevented, restricted, interfered with or
delayed by reason of any cause beyond the reasonable control of the party liable
to perform, including acts of God, acts of civil or military authority, fires,
floods, epidemics, quarantine restrictions, war, armed hostilities, riots and
transportation delays directly resulting from a broadly based industry-wide
strike or work stoppage, unless conclusive evidence to the contrary is provided,
the party so affected shall, upon giving written notice to the other party, be
excused from such performance to the extent of such prevention, restriction,
interference or delay, provided that the affected party shall use its reasonable
efforts to avoid or remove such causes of non-performance and shall continue
performance with the utmost dispatch whenever such causes are removed. When such
circumstances arise, the parties shall discuss what, if any, modification of the
terms of this Agreement may be required in order to arrive at an equitable
solution.

             (b) For purposes of Section 11.4(d) of this Agreement, a
"PERFORMANCE SUSPENSION EVENT" shall be deemed to have occurred if, on or before
April 30, 2001, a Third Party has made or filed with a court or arbitrator a
written request (a "SUSPENSION REQUEST") seeking to prohibit, restrain or enjoin
the performance by the Company or Genzyme of their respective obligations under
this Agreement which Suspension Request is based upon or arises out of a claim
which, if substantiated, would constitute a breach by Focal of its
representations and warranties set forth in clause (iv) or clause (v) of Section
13.1 of this Agreement and (i) on or before April 30, 2001, such court or
arbitrator has granted an award, order, injunction or decision enforcing such
Suspension Request and such award, order, injunction or decision continues to be
in effect and is binding upon the parties on April 30, 2001; or (ii) as of April
30, 2001, such Suspension Request has been pending for a period of not less than
one hundred thirty-five (135) days and has not been denied or dismissed with
prejudice, or (iii) as of April 30, 2001, such Suspension Request has been
pending for a period of less than one hundred thirty-five (135) days and a court
or arbitrator subsequently grants an award, order, injunction or decision
enforcing such Suspension Request.

                                       44
<PAGE>

         16.2 GOVERNING LAW. This Agreement shall be deemed to have been made in
the Commonwealth of Massachusetts and its form, execution, validity,
construction and effect shall be determined in accordance with the laws of the
Commonwealth of Massachusetts, without giving effect to the principles of
conflicts of law thereof.

         16.3 GOVERNMENTAL APPROVALS AND MODIFICATION BY LEGISLATION.

             (a) In addition to the obligations of the parties as set forth in
Section 7.1, the parties acknowledge that the approval of some portions of this
Agreement may be required by other governmental authorities or agencies. If such
approval is required, the parties will use their best efforts to obtain such
approval. If such approval is denied, the parties, in good faith, shall review
those portions of the Agreement that have not been approved, shall modify such
portions of the Agreement as may be reasonably appropriate to meet the
objections consistent with the business interests of the parties, and shall
otherwise take all steps that may be reasonably required to continue the
distribution of the Systems as contemplated by this Agreement.

             (b) If, at any time during the term of this Agreement, any
provision, term, condition or object of this Agreement is in conflict with any
law, statute, court judgment or regulation, including applicable anti-trust
laws, of any country in the Territory, the parties will use their best efforts
to modify the applicable provision in a manner that is in conformity with such
law, statute, court judgment or regulation, and appropriate modifications to
this Agreement shall be made by the parties to avoid such conflict and to ensure
lawful performance of this Agreement.

         16.4 INJUNCTIVE RELIEF. The parties acknowledge that damages at law may
be an inadequate remedy for the breach of any of the duties and obligations of
the parties contained in this Agreement; accordingly, to the extent permitted
under, and in accordance with, Section 16.5(d), each party shall be entitled,
without the need of establishing actual damages, to such injunctive relief as
may be necessary to prevent, or to enjoin the continuation of, any such breach.

         16.5 DISPUTE RESOLUTION.

             (a) Any matter or dispute that cannot be resolved by the required
vote of the Collaboration Committee, and any other dispute, controversy or claim
arising out of or relating to this Agreement, or the breach, termination, or
invalidity of this Agreement, shall be submitted in the first instance to the
most senior officer of the Focal and Genzyme business unit responsible for the
performance of each party's obligations under this Agreement.

             (b) If the matter or dispute cannot be resolved by the senior
officers of the relevant business units pursuant to Section 16.5(a) within
twenty (20) days after submission, either party may submit such matter or
dispute to the Chief Executive Officer of Focal and the Chief Executive Officer
of Genzyme.

             (c) If the matter or dispute cannot be resolved by the individuals
designated in Section 16.5(b) within thirty (30) days after such submission,
either party may initiate an Alternative Dispute Resolution ("ADR") proceeding
in accordance with the procedures set forth in EXHIBIT E attached hereto.

                                       45
<PAGE>

             (d) The arbitration decision shall be binding upon the parties. The
decision of the arbitrators shall be executory, and the prevailing party may
enter such decision in any court having competent jurisdiction. Each party shall
have the right to institute judicial proceedings against the other party or
anyone acting by, through or under such other party (including the right to seek
and to obtain injunctive relief) solely to enforce the instituting party's
arbitration rights or the decision of the arbitrators or to enforce, protect
and/or preserve the instituting party's intellectual property rights.

         16.6 SEVERABILITY AND CLAIMS.

             (a) If any provision of this Agreement is held by a court of
competent jurisdiction to be invalid or unenforceable, it shall be modified, if
possible, to the minimum extent necessary to make it valid and enforceable or,
if such modification is not possible, it shall be stricken and the remaining
provisions shall remain in full force and effect; provided, however, that if a
provision is stricken so as to significantly alter the economic arrangements of
this Agreement, the party adversely affected may terminate this Agreement upon
sixty (60) days' prior written notice to the other party.

             (b) If any of the material terms or provisions of this Agreement is
in conflict with any applicable statute or rule of law in any jurisdiction, then
such term or provision shall be deemed inoperative in such jurisdiction to the
extent of such conflict and the parties will renegotiate the affected terms and
conditions of this Agreement to resolve any inequities.

             (c) If any Third Party threatens or initiates any claim, action,
suit, arbitration or proceeding (a "Claim") relating to or arising out of (i)
the execution, delivery or performance of this Agreement, (ii) the right by
Focal to grant to Genzyme the rights conferred under this Agreement, or (iii)
the conflict of the terms of this Agreement with any other agreement, commitment
or arrangement to which Focal is bound, Focal shall promptly furnish notice to
Genzyme of the existence of the Claim. Focal agrees to vigorously contest any
Claim, including without limitation, taking such actions as may be reasonably
required under the circumstances to defend against the imposition of any form of
injunctive relief that could adversely affect the ability of Focal to perform
its obligations under this Agreement pending the final judgement, determination
or resolution of such Claim. Focal shall select reputable, appropriately
qualified counsel to defend such Claim and shall consult with Genzyme and give
due consideration to Genzyme's concerns with respect to such decision. Focal
shall furnish sufficient information to Genzyme on a periodic basis regarding
the status of the Claim so as to enable Genzyme to make a determination as to
the likely outcome of such Claim. In addition, Focal shall not settle,
compromise, consent to the entry of any judgement or accept any arbitration
decision relating to a Claim that could cause the termination, novation or
substantial revision of all or any part of this Agreement, or otherwise could
materially and adversely affect Genzyme's ability to enjoy the financial
benefits of this Agreement, without Genzyme's prior written consent, which
consent shall not be unreasonably withheld.

         16.7 ENTIRE AGREEMENT. This Agreement constitutes the entire Agreement
between the parties relating to the distribution of the Systems. All previous
writings and understandings, whether oral or written, heretofore made are
expressly merged in and made a part of this Agreement, including without
limitation (i) the Confidential Non-Disclosure Agreement, dated January 21,
1999, between the parties, and (ii) the Genzyme letter, dated August 23, 1999,
and accepted by Focal on August 25, 1999, setting forth the proposal for this
collaboration. The parties acknowledge the existence of a Stock Purchase
Agreement and a Registration Rights Agreement, dated the date hereof, relating
to the acquisition by

                                       46
<PAGE>

Genzyme of Focal common stock. In the event of any inconsistency between this
Agreement and the Stock Purchase Agreement, the Registration Rights Agreement,
or any ancillary agreement or document contemplated by this Agreement or the
Stock Purchase Agreement, the terms of this Agreement shall govern.

         16.8 AMENDMENT. This Agreement may not be amended, supplemented or
otherwise modified except by an instrument in writing signed by both parties
that specifically refers to this Agreement.

         16.9 NOTICES. Any notice required or permitted under this Agreement be
sent by certified mail or courier service, charges pre-paid, or by facsimile
transmission, to the address or facsimile number specified below:

                  If to Focal:      Focal, Inc.
                                    4 Maguire Road
                                    Lexington, Massachusetts  02173
                                    Attn:  Chief Executive Officer

                                    Telephone:        781-280-7800
                                    Fax:              781-280-7802

                  With a copy to:   Hale and Dorr LLP

                                    60 State Street
                                    Boston, Massachusetts 02109
                                    Attn:  Steven D. Singer

                                    Telephone:        617-526-6000
                                    Fax:              617-526-5000

                  If to Genzyme:    Genzyme Corporation
                                    One Kendall Square
                                    Cambridge, Massachusetts 02139
                                    Attn:  Earl M. Collier, Jr.
                                    President, Genzyme Surgical Products

                                    Telephone:        617-252-7863
                                    Fax:              617-761-8918

                  With a copy to:   Genzyme Corporation
                                    One Kendall Square
                                    Cambridge, Massachusetts  02139
                                    Attn:  Chief Corporate Counsel

                                    Telephone:        617-252-7560
                                    Fax:              617-252-7553

                                    and

                                       47
<PAGE>

                                    Palmer & Dodge
                                    One Beacon Street
                                    Boston, Massachusetts  02108
                                    Attn:  Paul M. Kinsella, Esq.

                                    Telephone:        617-573-0513
                                    Fax:              617-227-4420

or to such other address or facsimile number as the person may specify in a
notice duly given to the sender as provided herein. A notice will be deemed to
have been given as of the date that is five (5) business days after it is
deposited in the United States mail or the date it is delivered by a an
overnight or same day courier service or, in the case of facsimile transmission,
when received.

         16.10 BINDING EFFECT AND ASSIGNMENT. This Agreement shall be binding
upon and inure to the benefit of the successors and assigns of the parties
hereto. This Agreement may not be assigned or otherwise transferred by either
Party without the consent of the other party; provided, however, that either
Genzyme or Focal may, without such consent, assign its rights and obligations
under this Agreement (i) to any Affiliate in connection with a corporate
reorganization, or (ii) to a Third Party in connection with a merger,
consolidation or sale of all or substantially all of such party's assets;
provided, however, that with respect to clause (i) the Affiliate shall continue
to be directly or indirectly owned or controlled by the party assigning this
Agreement or by the person who directly or indirectly owns or controls such
party ("control" to be defined as set forth in Section 1.1), and, with respect
to either clause (i) or clause (ii), such party's rights and obligations under
this Agreement shall be assumed by its successor in interest in any such
transaction and shall not be transferred separate from all or substantially all
of its other business assets, including those business assets that are the
subject of this Agreement. Any purported assignment in violation of the
preceding sentence shall be void. Any permitted assignee shall assume in writing
all obligations of its assignor under this Agreement.

         16.11 HEADINGS AND REFERENCES. All section headings contained in this
Agreement are for convenience of reference only and shall not affect the meaning
or interpretation of this Agreement. Unless the context requires otherwise, all
references in this Agreement to any article or section shall be deemed and
construed as references to an article or section of this Agreement.

         16.12 NO AGENCY. It is understood and agreed that each party shall have
the status of an independent contractor under this Agreement and that nothing in
this Agreement shall be construed as authorization for either party to act as
agent for the other. Members of the Collaboration Committee shall remain
employees of Genzyme or Focal, as the case may be.

         16.13 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute but one and the same instrument. A facsimile
transmission of the signed Agreement shall be legal and binding on all parties.

                  [Remainder of page intentionally left blank]

                                       48
<PAGE>

         IN WITNESS WHEREOF, the parties, through their authorized officers,
have duly executed this Agreement intending it to be effective and binding as of
the date first written above.

                                  FOCAL, INC.

                                  By: /s/ David M. Clapper
                                      -----------------------------------------
                                       Name:    David M. Clapper
                                       Title:   President

                                  GENZYME CORPORATION

                                  By: /s/ Earl M. Collier, Jr.
                                      -----------------------------------------
                                       Name:    Earl M. Collier, Jr.
                                       Title:   Executive Vice President

                                       49
<PAGE>

                                    EXHIBIT A

                                    PRODUCTS

I.       APPLICATORS

         The Sealant product is applied to tissue via a delivery system
(depicted in the drawing below) consisting of separate applicators for the
primer and sealant solutions.

         Each applicator consists of a disposable syringe, an extension that
contains a lumen for material delivery and a flow-through brush to allow
dispensing and spreading of the primer or sealant on the tissue surface. The
syringe attaches to the extension via a luer-lock hub. The applicators and
associated brushes are supplied sterile in a tray and are intended for single
use.

         PRIMER APPLICATOR

         -    Single-use, disposable, sterile packaged in procedural kit

         -    Accepts a Focal-specified 5 cc syringe with luer-lock tip

         -    Shaft length is nominal 17 cm from luer hub to tip

         -    Distal end has nominal 45[degree] bent tip to facilitate use in
              thoracic cavity

         -    Non-removable flow-through brush

         -    Atraumatic brush with synthetic bristles

         -    Smooth external surfaces which prevent damage to tissue or
              surgical gloves

         -    Allows comfortable input forces to dispense primer

         -    EtO sterilized

         SEALANT APPLICATOR

         -    Single-use, disposable, sterile packaged in procedural kit

         -    Accepts a custom Focal red 10 cc syringe with luer-lock tip

         -    Shaft length is nominal 17 cm from luer hub to tip

         -    Distal end has nominal 45[degree] bent tip to facilitate use in
              thoracic cavity

         -    Includes removable, positive lock flow-through brush

         -    Atraumatic brush with synthetic bristles

                                      A-1
<PAGE>

         -    Allows comfortable input forces to dispense sealant

         -    EtO sterilized

                                      A-2
<PAGE>

II. LAMP MODULES

         -    Customer replaceable, self-aligning Xenon arc lamp

         -    Lamp life of 300 hours

                                      A-3
<PAGE>

III. LIGHT SOURCES

         -    Source of visible light using a self-regulating power supply
              capable of operating at 110 volts/60 Hz or 220 volts/50 Hz.

         -    Portable (not to exceed 10 kg).

         -    Noise level [less than] TBD dB at TBD meters on all sides.

         -    Provides visible light (470-520 nm wavelength range) at 400
              milliwatts minimum output bandwidth at factory set duration of 40
              seconds.

         -    Maximum delay of 0.1 seconds between pulses.

         -    Surgeon control allows mid-cycle light shut-off.

         -    Customer Replaceable, self-aligning lamp.

         -    Target Cost of Goods with overhead: [less than or equal to]$3,258
              each (assuming > 300 units/year).

         -    Optical/electrical connector is easy to inert and remove, but
              difficult to inadvertently remove.

         -    The light source is packaged non-sterile.

         -    Passes EN60601 ISO standard for earth ground and leakage current.

                                      A-4
<PAGE>

IV. LIGHT WANDS

         -    Re-usable; 1 year expected life.

         -    Hand-held, ambidextrous grip with finger activation of light
              switch.

         -    Nominal 5 mm diameter x 15 cm shaft length with curved tip
              (nominal 45[degree]) for access to thoracic cavity.

         -    Atraumtic external surfaces to prevent damage to tissue or
              surgical gloves.

         -    Flexible, low friction, cable housing optical fiber(s) and
              electrical conductors (3.5 m length).

         -    Entire assembly is sealed for submersion in fluids.

         -    External surfaces resistant to common cleaning alcohols,
              disinfecting detergents.

         -    Steam resterilizable for > 300 cycles.

         -    75% Transmission efficiency (minimum).

         -    Passes EN60601 ISO standard for earth ground and leakage current.

                                      A-5
<PAGE>

PRIMER AND SEALANT

         The Sealant product is delivered as a two-component system (depicted in
the drawing below) consisting of a lower viscosity primer and a higher viscosity
sealant. The materials are polymerized using a custom visible light source. The
materials hydrolyze and are absorbed by the body.

         The sealant system consists of 4 sub-systems:

         -    Primer and Sealant formulations

         -    Separate applicators for applying primer and sealant

         -    Light Wand to provide directed light energy to the application
              site

         -    Light Source

PRIMER AND SEALANT

         The primer and sealant formulations will be shipped and stored frozen
as part of a procedural kit with an initial shelf-life of 15 months. It is
anticipated that by one year after commercial introduction, the shelf-life can
be increase to 24 months. Storage, handling, and/or mixing requirements will be
within the capabilities of the hospital staff and infrastructure.

The system will require no more than 10 minutes to prepare for use.

         The primer will be packaged as a 2-component system to yield at least 5
cc in a specified single-use, clear syringe that is compatible with the primer
applicator. The liquid component will be frozen in a clear vial. The second
component will be lyophilized and frozen in a clear vial. The outer surface of
the two primer vials will be sterilized by ETO following placement in a sealed
tray.

         The thawed contents of the sealant syringe is ready to use once
attached to its applicator. In the sterile field, the thawed contents of the
liquid vial will be transferred into the lyophilized vial with the included
needle and primer syringe, mixed and drawn back into the syringe for use.

         The sealant will be aseptially filled and packaged to yield at least 8
cc in a light-protected single-use syringe compatible with the sealant
applicator. The unfilled sealant syringe will be rendered sterile by ETO.

                                      A-6
<PAGE>

                                    EXHIBIT B

                             CO-PROMOTION GUIDELINES

         These Co-Promotion Guidelines set forth the policies and protocols
that Genzyme Surgical Products, a division of Genzyme Corporation ("GSP") and
Focal, Inc. ("Focal") have agreed to implement under the Distribution and
Marketing Collaboration Agreement dated as of October 21, 1999 to maximize
market penetration of the FocalSeal -Registered Trademark- -L product. These
Guidelines are subject to revision or supplement by the Collaboration
Committee. To maximize market penetration in an efficient and effective
manner, GSP and Focal agree to the following:

         -    Overall promotional, marketing and sales strategy and direction
              will be the responsibility of the Collaboration Committee.

         -    GSP will employ a cardiac sales group of at least twenty (20)
              individuals in the US market that will sell FocalSeal -Registered
              Trademark- -L product as one of its primary products. Focal will
              employ a dedicated thoracic promotional group of at least eight
              (8) individuals to co-promote the same product within a
              reasonable time after System Launch.

         -    Each sales/promotional group will be separately managed by their
              respective organizations and will have separate and specifically
              assigned hospital accounts for which they are primarily
              responsible to ensure accountability and to accurately measure
              performance.

         -    GSP, with the approval of the Collaboration Committee, will
              determine the assignment of hospital accounts to the respective
              sales/promotional groups. Given the unique strengths of each
              organization, GSP and Focal agree to assign primary responsibility
              for major cardiovascular accounts to GSP and major pulmonary
              accounts to Focal to the extent possible.

         -    Focal product specialists shall not be authorized to commit or
              finalize Product sales. All sales shall be subject to approval and
              acceptance by GSP. All sales to end-users will be recognized as
              sales by GSP and, accordingly, will be recorded as revenue by GSP
              regardless of which organization generated the order.

         -    Focal will be responsible for the design and implementation of
              promotional and sales training. GSP agrees that its sales force
              will meet or exceed the product knowledge standards as determined
              by Focal that are necessary to properly sell the Products.
              Additionally, Focal will provide appropriate training support at
              national and regional sales meetings, conventions and surgeon
              training sessions as provided for in the Agreement.

         -    To develop a consistent approach to end-users, the sales
              management of both organizations will implement compatible field
              organization policies.

                                      B-1
<PAGE>

         Recognizing the importance of the Product representatives to the market
penetration goal, GSP will assist Focal to recruit candidates that have skills,
expertise and qualifications that are consistent with existing GSP sales
representatives.

         -    The Collaboration Committee will on a quarterly basis review the
              effectiveness and efficiency of all policies and procedures.

                                      B-2
<PAGE>

                                    EXHIBIT C

                            REUSABLE PRODUCT WARRANTY

         The following sets forth the terms of the Third Party warranty as
currently in effect with respect to the Light Sources and Lamp Modules (with
capitalized terms having the meanings set forth in that certain Supply Agreement
between Focal and ILC):

WARRANTIES AND INDEMNIFICATION

         1.1 WARRANTIES

             (a) Materials, Workmanship. ILC warrants the Light Sources and
Replacement Lamp Modules to be free from defective material and workmanship and
agrees to promptly remedy any such defect or to promptly (but in no event, in no
more than fifteen (15) days) furnish a new part in exchange for any part of any
unit of its manufacture which, under normal installation, use, and service
discloses such defect, provided the unit is delivered to ILC intact, for
examination with all transportation charges prepaid for the following periods:
(a) the duration of the warranty for the Light Sources shall be the lesser of
eighteen (18) months after delivery to Focal or twelve (12) months after
delivery to end users of the Light Sources; (b) the duration of the warranty for
the Replacement Light Module shall be as stated in the Specifications. In the
event the returned units are defective, ILC shall promptly return the repaired
or replaced unit to Focal or Focal's designee, at ILC's expense. ILC shall not
be obligated to pay the expenses of transporting the Light Sources or
Replacement Lamp Modules to ILC. Notwithstanding the foregoing, the warranty in
this Section 5.1.1 does not extend to any Light Source or Replacement Lamp
Module (i) which has been subjected to misuse, neglect, accident, incorrect
wiring not installed by ILC, improper installation, or to use in violation of
instructions furnished in writing by ILC with the Light Source customer
documentation, (ii) which has been repaired or altered other than by ILC, (iii)
the serial number of which has been removed, defaced or changed, or (iv) which
has been used with accessories not manufactured or recommended by ILC or Focal.

         1.2 OTHER WARRANTIES. ILC further covenants, represents and warrants to
Focal that (i) all Light Sources old by ILC to Focal hereunder will comply in
all material respects with the Specifications, conform with the information
shown on the Q.A. Data Sheet provided for the particular shipment and not
contain any Latent Defects; (ii) all of the Light Sources sold hereunder shall
have been manufactured, package, stored and shipped in conformance with all
applicable current Good Manufacturing Practices which are in force or
hereinafter adopted by the FDA or any other analogous foreign government agency
with jurisdiction over the Light Sources; (iii) title to all Light Sources sold
hereunder shall pass to Focal as provided herein free and clear of any security
interest, lien, or other encumbrance; (iv) ILC has not previously granted and
will not grant any rights to use and sell the Light Sources to any third party,
which rights are inconsistent with the rights granted to Focal herein; and (v)
neither the manufacture, use nor sale of the Light Sources will infringe any
United States patent, trademark, or other intellectual property right or
misappropriate any trade secret of any third party in the U.S., or to ILC's
knowledge as of the Effective Date, infringe any patent, trademark or other
intellectual property right or misappropriated any trade secret of any third
party outside the U.S.

         1.3 DISCLAIMER. EXCEPT AS EXPRESSLY PROVIDED HEREIN, ILC MAKES NO
REPRESENTATION OR WARRANTY AS TO THE LIGHT SOURCES, AND ILC HEREBY

                                      C-1
<PAGE>

EXPRESSLY DISCLAIMS ANY AND ALL IMPLIED OR STATUTORY WARRANTIES, INCLUDING
WITHOUT LIMITATION, WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE, OR NONINFRINGEMENT, OR WARRANTIES ARISING OUT OF COURSE OF DEALING OR
INDUSTRY PRACTICE.

         1.4 LIMITATION OF LIABILITY. THE FEES RECEIVED BY ILC UNDER THIS
AGREEMENT DO NOT INCLUDE ANY ASSUMPTION BY ILC OF ANY RISK OF FOCAL OR ANY OTHER
PERSON OR ENTITY, OF ANY CONSEQUENTIAL DAMAGES, INCLUDING WITHOUT LIMITATION,
ANY LOSS OF PROFITS, OR OTHERWISE. ACCORDINGLY, ILC SHALL NOT BE LIABLE TO FOCAL
FOR ANY LOSS OF USE, DATA OR PROFITS, BUSINESS INTERRUPTION OR ANY SPECIAL,
INCIDENTAL, INDIRECT, CONSEQUENTIAL, EXEMPLARY, OR RELIANCE DAMAGES HOWEVER
CAUSED IN ANY WAY OUT OF THIS AGREEMENT, EVEN IF ADVISED OF THE POSSIBILITY OF
SUCH DAMAGE AND NOTWITHSTANDING THE FAILURE OF THE ESSENTIAL PURPOSE OF ANY
REMEDY.

                                      C-2
<PAGE>

          CONFIDENTIAL MATERIALS OMITTED AND FILED SEPERATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.

                                    EXHIBIT D

                              Annual Sales Forecast

                                 SALES FORECAST
                      JANUARY 1, 2000 TO DECEMBER 31, 2000

        The table set forth below contains the Annual Sales Forecast for
calendar year 2000 as referenced in Section 6.3(a) of this Agreement.

         This Annual Sales Forecast is stated in units of Products, and
assumes the Product Launch for the FocalSeal -Registered Trademark- -L System
will take place on or before April 1, 2000. If the Product Launch takes place
before April 1, 2000, the Annual Sales Forecast shall remain as stated. If
the Product Launch takes place after April 1, 2000, the Annual Sales Forecast
shall be adjusted as follows: (i) if the Product Launch occurs on or before
the 15th day of the month, then such month shall be deemed to constitute
"April 2000" under the Annual Sales Forecast and the Annual Sales Forecast
for each succeeding month shall apply in accordance with the table, and (ii)
if the Product Launch occurs after the 15th day of the month, then the next
month shall be deemed to constitute "April 2000" under the Annual Sales
Forecast and the Annual Sales Forecast for each succeeding month shall apply
in accordance with the table.

         For the purpose of calculating the Purchase Minimums for which Genzyme
is responsible in 2000 under Section 6.4, the units of Products set forth below
in the Table shall be reduced by [**]. For example, if during the 2nd quarter of
2000, the Tier 1 Purchase Minimum, as defined under Section 6.4(a) is [**] units
(forecast of [**] Sealant units x [**] x [**]) and the Genzyme sales
representatives generated orders totaling [**] units during the 2nd quarter, an
additional [**] units would be required to be purchased by Genzyme.

<TABLE>
<CAPTION>
                        1ST QUARTER             2ND QUARTER             3RD QUARTER          4TH QUARTER
                    -------------------   --------------------    --------------------    -------------------
                    JAN.   FEB.    MAR.   APRIL   MAY     JUNE    JULY    AUG.    SEPT.   OCT.   NOV.    DEC.
                    ----   ----    ----   -----   ---     ----    ----    ----    -----   ----   ----    ----
<S>                 <C>    <C>     <C>    <C>     <C>     <C>     <C>     <C>     <C>     <C>    <C>     <C>
   SEALANT KITS     [**]   [**]    [**]   [**]    [**]    [**]    [**]    [**]    [**]    [**]   [**]    [**]
 APPLICATOR KITS    [**]   [**]    [**]   [**]    [**]    [**]    [**]    [**]    [**]    [**]   [**]    [**]
LIGHT SOURCES (A)   [**]   [**]    [**]   [**]    [**]    [**]    [**]    [**]    [**]    [**]   [**]    [**]
   LIGHT WANDS      [**]   [**]    [**]   [**]    [**]    [**]    [**]    [**]    [**]    [**]   [**]    [**]
 LAMP MODULES (B)   [**]   [**]    [**]   [**]    [**]    [**]    [**]    [**]    [**]    [**]   [**]    [**]
</TABLE>

(a) The lead time for ordering Light Sources is currently 4+ months.

(b) It is recommended that one spare Lamp Module be purchased with each Light
    Source.

                                      D-1
<PAGE>

                                    EXHIBIT E

                                 ADR PROCEDURES

         1. To begin an ADR proceeding, a Party shall provide written notice to
the other Party of the issues to be resolved by ADR. Within fourteen (14) days
after its receipt of such notice, the other Party may, by written notice to the
Party initiating the ADR, add additional issues subject to ADR pursuant to
Section 16.5 to be resolved within the same ADR.

         2. Within twenty-one (21) days following receipt of the original ADR
notice, the Parties shall select a mutually acceptable neutral party to preside
in the resolution of any disputes in this ADR proceeding. If the Parties are
unable to agree on a mutually acceptable neutral party within such period, a
Party may request the President of the CPR Institute for Dispute Resolution
("CPR"), 366 Madison Avenue, 14th Floor, New York, New York 10017, to select a
neutral party pursuant to the following procedures:

             (a) The CPR shall submit to the Parties a list of not less than
five (5) candidates within fourteen (14) days after receipt of the request,
along with a Curriculum Vitae for each candidate. No candidate shall be an
employee, director or shareholder of a Party or any of their Affiliates.

             (b) Such list shall include a statement of disclosure by each
candidate of any circumstances likely to affect his or her impartiality.

             (c) Each Party shall number the candidates in order of preference
(with the number one (1) signifying the greatest preference) and shall deliver
the list to the CPR within seven (7) days following receipt of the list of
candidates. If a Party believes a conflict of interest exists regarding any of
the candidates, that Party shall provide a written explanation of the conflict
to the CPR along with its list showing its order of preference for the
candidates. Any Party failing to return a list of preferences on time shall be
deemed to have no order of preference.

             (d) If the Parties collectively have identified fewer than three
(3) candidates deemed to have conflicts, the CPR immediately shall designate as
the neutral party the candidate for whom Focal on the one hand, and Genzyme on
the other hand, have indicated the greatest preference. If a tie should result
between two candidates, the CPR may designate either candidate. If the Parties
collectively have identified three (3) or more candidates deemed to have
conflicts, the CPR shall review the explanations regarding conflicts and, in its
sole discretion, may either (i) immediately designate as the neutral party the
candidate for whom the Parties collectively have indicated the greatest
preference, or (ii) issue a new list of not less than five (5) candidates, in
which case the procedures set forth in subsection 2(a)-(d) shall be repeated.

         3. No earlier than twenty-eight (28) days or later than fifty-six (56)
days after selection, the neutral party shall hold a hearing to resolve each of
the issues identified by the Parties. The ADR proceeding shall take place at a
location agreed upon by the Parties. If the Parties cannot agree, the neutral
party shall designate a location other than the principal place of business of
either Party or any of their Affiliates.

                                      E-1
<PAGE>

         4. At least seven (7) days prior to the hearing, each Party shall
submit the following to the other Party and the neutral party:

             (a) a copy of all exhibits on which such Party intends to rely in
any oral or written presentation to the neutral party;

             (b) a list of any witnesses such Party intends to call at the
hearing, and a short summary of the anticipated testimony of each witness;

             (c) a proposed ruling on each issue to be resolved, together with a
request for a specific damage award or other remedy for each issue. The proposed
rulings and remedies shall not contain any recitation of the facts or any legal
arguments and shall not exceed one (1) page per issue.

             (d) a brief in support of such Party's proposed rulings and
remedies, provided that the brief shall not exceed twenty (20) pages. This page
limitation shall apply regardless of the number of issues raised in the ADR
proceeding.

         5. Consistent with subsections 4(a)-(d), the neutral party shall
establish the rules for and resolve any disputes concerning, any discovery to be
conducted prior to the ADR hearing, including but not limited to depositions,
interrogatories, requests for admissions, or production of documents.

         6. The hearing shall be conducted on two (2) consecutive days and shall
be governed by the following rules:

             (a) Each Party shall be entitled to five (5) hours of hearing time
to present its case. The neutral party shall determine whether each Party has
had the five (5) hours to which it is entitled.

             (b) Each Party shall be entitled, but not required, to make an
opening statement, to present regular and rebuttal testimony, documents or other
evidence, to cross-examine witnesses, and to make a closing argument.
Cross-examination of witnesses shall occur immediately after their direct
testimony (unless a witness affiliated with a party has been called by the other
party in that party's case, in which event the party with which the witness is
affiliated may examine the witness either immediately after the direct
examination or as part of that party's case), and cross-examination time shall
be charged against the party conducting the cross-examination.

             (c) The Party initiating the ADR shall begin the hearing and, if it
chooses to make an opening statement, shall address not only issues it raised
but also any issues raised by the responding Party. The responding Party, if it
chooses to make an opening statement, also shall address all issues raised in
the ADR. Thereafter, the presentation of regular and rebuttal testimony and
documents, other evidence, and closing arguments shall proceed in the same
sequence.

             (d) Settlement negotiations, including any statements made therein,
shall not be admitted or referenced to in the ADR hearing under any
circumstances. Affidavits prepared

                                      E-2
<PAGE>

for purposes of the ADR hearing also shall not be admissible. As to all other
matters, the neutral party shall have sole discretion regarding the
admissibility of any evidence.

         7. Within seven (7) days following completion of the hearing, each
Party may submit to the other Party and the neutral party a post-hearing brief
in support of its proposed rulings and remedies, provided that such brief shall
not contain or discuss any new evidence and shall not exceed ten (10) pages.
This page limitation shall apply regardless of the number of issues raised in
the ADR proceeding.

         8. The neutral party shall rule on each disputed issue within fourteen
(14) days following completion of the hearing. In making his/her ruling, the
neutral party shall apply the governing law provisions of the Agreement. Such
ruling shall adopt in its entirety the proposed ruling and remedy of one of the
Parties on each disputed issue but may adopt one Party's proposed rulings and
remedies on some issues and the other Party's proposed rulings and remedies on
other issues. The neutral party may, but need not, issue a written opinion or
otherwise explain the basis of the ruling.

         9. The neutral party shall be paid a reasonable fee plus expenses.
These fees and expenses, along with the reasonable legal fees and expenses of
the prevailing Party (including all reasonable expert witness fees and
expenses), the fees and expenses of a court reporter, if any, and any expenses
for a hearing room, shall be paid as follows:

             (a) If the neutral party rules in favor of one Party on all
disputed issues in the ADR, the losing Party shall pay 100% of such fees and
expenses.

             (b) If the neutral party rules in favor of one Party on some issues
and the other Party on other issues, the neutral party shall issue with the
rulings a written determination as to how such fees and expenses shall be
allocated between the parties. The neutral party shall allocate fees and
expenses in a way that bears a reasonable relationship to the outcome of the
ADR, with the Party prevailing on more issues, or on issues of greater value or
gravity, recovering a relatively larger share of its legal fees and expenses.

         10. The rulings of the neutral party and the allocation of fees and
expenses shall be binding, non-reviewable, and non-appealable, and may be
entered as a final judgment in any court having jurisdiction.

         11. Except as provided in subsection (i) or as required by law, the
existence of the dispute, any settlement negotiations, the ADR hearing, any
submissions (including exhibits, testimony, proposed rulings, and briefs), and
the rulings and any written opinion of the neutral party shall be deemed
Confidential Information. The neutral party shall have the authority to impose
sanctions for unauthorized disclosure of Proprietary Information.

         12. No ADR proceeding between the Parties shall include, by
consolidation, joint or otherwise, any third party, without the consent of both
Parties.

                                      E-3

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