Document:

Q1 2002 10Q Exhibit 10.5

		
			March 27, 2002

		 

		Mr. John Bishop

		40W785 Campton Meadow Drive

		Elburn, Illinois 60119

		Dear John,

		On behalf of the Board of Directors of Cepheid, I am pleased to extend to you an offer letter to become the Chief Executive Officer of Cepheid (the "Company" or "Cepheid"). We are assuming that you will commence employment on or about April 12, 2002. Your election as a director of the Board will become effective as of the date that you commence employment. Our offer consists of the following benefits, terms and conditions:

			Position:
				Upon commencement of your employment with the Company, you will become the Chief Executive Officer of the Company, responsible for leading and managing the Company in all regards. You will also be appointed as a member of the Board of Directors of the Company and shall be nominated to serve on the Company's Board as long as you serve as Chief Executive Officer. You will report directly to the Board of Directors of the Company.
				
	During the term of your employment, you will devote your full business efforts and time to the Company. During the term of your employment, without the prior written approval of the Company (which will not be unreasonably withheld), you will not render services in any capacity to any other person or entity and will not act as a sole proprietor, partner or managing member of any other person or entity or as a shareholder owning more than one percent of the stock of any other corporation. The foregoing, however, will not preclude you from engaging in reasonable community, school or charitable activities, or act as a director of any private company which does not compete with the Company with the permission of the Board of Directors of the Company which should not be unreasonably withheld.
			

			
	Salary: You will receive a base salary of $11,923 per pay period (equivalent to $310,000.00 per year), which will be reviewed annually. You will be paid bi-weekly, less payroll deductions and required withholdings, in accordance with the Company's regular payroll practices.
			
	Bonus: You will be eligible for a cash bonus up to 25% of your base salary on an annual basis. Achievement of goals and objectives as established by the Board of Directors shall be the determining feature in what percentage you will receive; however, for the first year of your employment, your cash bonus will be guaranteed. Therefore, for the fiscal/calendar year 2002, your bonus will be administered as a one-time guaranteed payment of $77,500 less payroll deductions and required withholdings, in accordance with the Company's regular payroll practices. You must be actively employed by Cepheid on December 31, 2002 to be eligible to receive this bonus; provided that if the Company terminates your employment without "Cause" or you terminate it for "Good Reason," both as defined below, you will receive this guaranteed payment. In future years, the % payout will be determined by the degree of achievement against the established goals and objectives.
			
	Vacation and Employee Benefits: Your paid personal time off (PTO) begins to accrue as of the first day of your employment. Initially you will accrue PTO at a rate of four weeks per year of employment. Your PTO accrual rate will increase by an additional five days per year after the completion of your fourth and tenth years, respectively. Your PTO, including maximum accrual, will otherwise be governed by current company policy.
			
	Business Expenses: During the term of your employment, you will be authorized to incur necessary and reasonable travel including entertainment and other business expenses in connection with your duties to Cepheid. The Company will reimburse you for such expenses upon presentation of an itemized account and appropriate supporting documentation, all in accordance with the Company's generally applicable policies.
			
	Moving Expenses: Through March 31, 2003, the Company will reimburse you for all reasonable commuting expenses between your family residence in Illinois and Cepheid locations in conjunction with Company business and provide you with a reasonable rental supplement for temporary living arrangements near Cepheid as shall be agreed upon by you and the Board. Should you decide to relocate your family to the vicinity of Cepheid, the Company will reimburse you for all reasonable and customary moving expenses incurred prior to June 30, 2003 or as shall be agreed upon by you and the Board.
			
	Stock Options: Subject to approval by the Board of Directors, upon commencement of your employment with Cepheid, you will be granted an option, to purchase 750,000 shares of the Company's Common Stock at an option price equal to the closing price of the Company's common stock on the date your employment commences. The option will be immediately exercisable subject to the right of repurchase and will be an incentive stock option to the maximum extent permitted by the Internal Revenue Code of 1986, as amended (the "Code"). The right of repurchase shall expire with respect to 25% of the total number of shares one year after the vesting base date, and with respect to an additional 1/48th of the total number of shares at the end of each month thereafter; so that the right of repurchase shall have expired with respect to all of the shares on and after four years after the vesting base date.
			
	No Conflicting Obligations: You represent and warrant to the Company that you are under no obligations or commitments, whether contractual or otherwise, that are inconsistent with your obligations under this Agreement other than those obligations and commitments set forth in Section 2(c) of the Confidentiality and Noncompetition Agreement attached hereto as Exhibit A.
			
	Termination Benefits:
				Provided the parties enter into a mutual general release, if you are involuntarily terminated by the Company without "Cause," or you terminate your employment upon written notice to the Board of Directors at any time for "Good Reason," both as defined below, the Company will provide you with (i) any accrued base salary, reimbursements, unused and unpaid PTO and other benefits earned through your date of termination, (ii) a single lump sum severance payment equal to twelve (12) months of your current annual base salary, (iii) a single lump sum payment equal to your prorated target cash bonus and (iv) the Company will immediately accelerate the vesting of 50% of all unvested stock options which will be exercisable for a period of three months following the date of such termination.
				
	In addition, regardless of the dates of termination referred to above, in the event of a termination by the company without Cause, or by you for Good Reason if you choose to continue the health care pursuant to COBRA for you and your eligible dependents, the Company will pay your COBRA premiums during such period of severance referred to above, provided you or your dependents remain eligible under the provisions of COBRA.
				
	For the purposes of this Offer, a termination for "Cause" will mean a termination initiated by the Company or a successor for any of the following reasons: (i) failure to perform any reasonable and lawful duty of your position after being given written notice of such failure by the Board of Directors and fifteen days in which to cure your performance, provided that such notice will be required only with respect to the first failure; (ii) an act committed by you which constitutes misconduct and which is injurious to the Company or any subsidiary or a successor; (iii) your being convicted of, or pleading "guilty" or "no contest" to, a felony under the laws of the United States or any state thereof; (iv) your committing an act of fraud against, or the misappropriation of property belonging to, the Company or any subsidiary or a successor; (v) an act of dishonesty committed by you in connection with your responsibilities as an employee and affecting the business or affairs of the Company; (vi) a breach of any confidentiality or proprietary information or other agreement between you and the Company or any subsidiary or any successor; or (vii) the failure or refusal by you to carry out the reasonable directives of the Company, if such failure continues for fifteen days or more after the Company has given written notice describing such failure, provided that such notice shall be required only with respect to the first failure.
				
	"Good Reason" means the occurrence of any of the following conditions, without your written consent: (i) a significant diminution in the nature or scope of your authority, title, function or duties; (ii) a 10 % reduction in your base annual salary or 25% reduction in your target bonus (in either case, unless such reduction is part of an officer-wide program to reduce expenses); (iii) any material breach of this letter agreement by the Company; (iv) the Company's requiring you to be based at any office or location more than 50 miles from the Company's current headquarters in Sunnyvale, California; or (v) failure of any successor to assume this agreement.
				
	If your employment is terminated by the Company or a successor for "Cause" or if you leave voluntarily without "Good Reason," you will be paid your base salary and all unused and unpaid PTO earned through your date of termination, but no other benefits. In such event, all stock vesting and benefits will cease on your date of termination.
				
	If you are involuntarily terminated by the Company without "Cause" or you terminate your employment upon written notice to the Board of Directors at any time for "Good Reason," with such termination occurring within one year of a Change of Control, the Company will provide you with (i) any accrued base salary, reimbursements, unused and unpaid PTO and other benefits earned through your date of termination of employment; (ii) a single lump sum severance payment equal to eighteen (18) months of your current annual base salary; (iii) a single lump sum payment equal to your target cash bonus you would have earned pursuant to Section 3 above; (iv) full immediate acceleration of the vesting and exercisability of your outstanding stock options, and (v) continued health care pursuant to COBRA for you and your eligible dependents paid for by the Company for a period of eighteen (18) months after such termination.
				
	If your employment is terminated due to your death or disability, you will be paid your base salary and all unused and unpaid PTO earned through your date of termination, but no other benefits except benefits pursuant to relevant insurance coverage. In such event, all stock vesting and benefits will cease on your date of termination. (Under the Company's stock option plan you have six months to exercise vested options after termination due to disability, and your representative, heir or devisee will have 12 months after termination due to death.)
				
	"Change of Control" means (i) any "person" of the Securities Exchange Act of 1934, as amended, "the Exchange Act", other than a trustee or other fiduciary holding securities of the Company under an employee benefit plan of the Company, becomes the "beneficial owner" (as defined in Rule 13d-3 promulgated under the Exchange Act), directly or indirectly, of securities of the Company representing 50% or more of (A) the outstanding shares of common stock of the Company or (B) the combined voting power of the Company's then outstanding securities, (ii) the Company is party to a merger or consolidation which results in the holders of voting securities of the Company outstanding immediately prior thereto failing to continue to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) at least 50% of the combined voting power of the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation, (iii) the sale or disposition of all or substantially all of the Company's assets (or consummation of any transaction having similar effect, (iv) the dissolution or liquidation of the Company.
				
	If your severance and other benefits provided for in this Offer Letter constitute "parachute payments" within the meaning of the Code, but for this subsection, would be subject to the excise tax imposed by Section 4999 of the Code, then your severance and other benefits under this Offer Letter will be payable, at your election, either in full or in such lesser amount as would result, after taking into account the applicable federal, state and local income taxes and the excise tax imposed bye Section 4999 of the Code, in your receipt on an after-tax basis of the greatest amount of severance and other benefits.
			

			
	Term: Unless your employment with Cepheid is earlier terminated, the provisions of this letter agreement shall govern the first 4 years of your employment. Assuming you remain employed by Cepheid, the parties will enter into negotiations for a new arrangement prior to expiration of the 4- year period to cover future periods. You agree to resign immediately upon request of the Company from your directorship upon termination of your employment for any reason.
			
	Miscellaneous:
				Benefits: You will be entitled to participate in the Company's standard benefit plans as a full-time employee to the extent set forth in such plans.
				
	Proprietary Information: You will be required to sign Cepheid's standard proprietary information and inventions agreement (attached hereto as Exhibit B).
				
	Final Agreement: The employment terms in this letter and the proprietary information and inventions agreement constitute the complete, final and exclusive embodiment of the entire agreement between you and Cepheid with respect to the terms and conditions of your employment. These terms supersede any other agreements or promises made to you by anyone, whether oral or written. This agreement is governed by California law and, except as set forth herein, shall be binding on the Company's successors and assigns.
				
	At-will Employment: California is an "at-will" employment state, and Cepheid is an at-will employer. This means that either you or the Company or any successor has the right to terminate the employment relationship at any time with or without cause. This is the full and final agreement between you and the Company or any successor on these terms. Although your job duties, title, compensation and benefits, and the personnel policies and procedures may change from time-to-time, the at-will nature of your employment may only be changed in a document signed by you and the Chairman of the Board of Directors.
				
	Authorization to Work: As required by law, this offer is subject to satisfactory proof of your identification and right to work in the United States of America.
			

		

		John, we are very excited about you joining the Cepheid team and look forward to a mutually rewarding relationship. We are convinced that your experience and commitment to develop a great company is an excellent match for both you and Cepheid. This offer will remain open to you until April 1, 2002. If you wish to accept employment at Cepheid under the terms described above, please sign, date and return a copy of this letter to signify your approval.

		I look forward to your favorable reply and to a productive and enjoyable working relationship with you.

		Sincerely,

		 

		 

		Thomas L. Gutshall

		CEO & Chairman

		Cepheid

		Accepted:

		 

		___________________________________  Date: ____________________

		John Bishop       

		cc: Board of Directors, CepheidEXHIBIT 10.14

                    SECOND DEVELOPMENT AND LICENSE AGREEMENT

         THIS SECOND DEVELOPMENT AND LICENSE AGREEMENT (the "Agreement") is
effective April 12, 2002 (hereinafter Effective Date) made by and between TYCO
HEALTHCARE GROUP LP, a Delaware Partnership having an office at 15 Hampshire
Street, Mansfield, Massachusetts 02048 (hereinafter "Kendall") and SAFETY
SYRINGE CORPORATION (hereinafter "SSC"), a corporation of the State of Utah and
wholly owned subsidiary of Specialized Health Products International, Inc.
("SHPI") having an office at 585 West 500 South, Bountiful, Utah 84010. Kendall
and SSC shall from time to time be referred individually as a Party or
collectively as the Parties.

                              W I T N E S S E T H:
         WHEREAS the First Development and License Agreement (as defined herein)
was made effective on March 29, 2000 by the Parties whereby certain rights to
the patent rights and technical information owned by SSC were assigned to
Kendall subject to a license for Blood Collection Products to Johnson & Johnson;

         WHEREAS Johnson & Johnson's license has been terminated and Kendall
desires to obtain rights to Blood Collection Products

         WHEREAS, Kendall wishes to fund and desires that the Parties jointly
continue to undertake the development of commercially viable Safety Syringe
Products and now develop Blood Collection Products as described herein;

         WHEREAS, SSC and Kendall desire that such Safety Syringe Products and
Blood Collection Products be made available to the commercial markets; and

         WHEREAS Kendall and SSC wish to amend, in part, the First Development
and License Agreement in accordance with the terms of this Agreement.

         NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, the Parties hereto agree as follows:

                             ARTICLE 1 - DEFINITIONS

         Where used in this Agreement, the following terms shall have the
meanings attributed to them herein:

         1.1 The term "Affiliate" of a Party, shall mean any company or other
legal entity, other than the Party, in whatever country organized, controlling,
controlled by, or under common control with the Party. The term "control" means
the possession of the power to direct or cause the direction of the management
and policies of an entity, whether through the ownership of voting securities,
by contract, or otherwise, and the term "entity" includes a corporation or other
entity.

         1.2 The term "Blood Collection Products" shall mean blood collection
needles and blood collection needle/holder combinations that would, but for the
assignment made herein, infringe any Valid Claim (defined below) of an issued
patent included in the Patent Rights (defined below).

         1.3 The term "Effective Date" shall mean the date first set forth
above.

         1.4 The term "Excluded Products" shall mean the products listed in
Exhibit 1.3, under "Excluded Product Categories" that would, but for the license
granted herein infringe any Valid Claim of an issued patent included in the
Patent Rights.

                                     Page 1
<PAGE>

         1.5 The term "First Blood Collection Commercial Sale Date" shall mean
the date when Kendall sells commercial quantities (at least 250,000 product
units) of Blood Collection Products or January 1, 2003, which ever occurs first.

         1.6 The term "First Development and License Agreement" shall mean the
agreement made effective on March 29, 2000 between Kendall and SSC whereby
certain rights to the patent rights were assigned to Kendall subject to a
license for Blood Collection Products to Johnson & Johnson.

         1.7 The term "First Minimum Annual Royalty" shall have the meaning as
set forth in Section 3.2.

         1.8 The term "First Safety Syringe Commercial Sale Date" shall mean the
date when either: (i) Kendall sells commercial quantities (at least 8,000,000
product units) of Safety Syringe Products (defined below); or (ii) September 29,
2002 (being thirty (30) months from March 29, 2000) which ever occurs first.

         1.9 The term "Included Products" shall mean Safety Syringe Products and
Blood Collection Products.

         1.10 The term "Initial Equipment" shall have the mean set forth in
Section 12.1.

         1.11 The term "Licensed Products" shall mean: (i) Safety Syringe
Products; (ii) Blood Collection Products; and/or (iii) any syringe product that
would, but for the assignment made herein, infringe any Valid Claim of an issued
patent included in Patent Rights.

         1.12 The term "Net Sales" shall mean the revenue received by Kendall, a
sublicensee or an Affiliate from the sale of Licensed Products to independent
third parties less the following amounts: (i) reasonable discounts, including
cash discounts, or rebates actually allowed or granted, (ii) credits or
allowances actually granted upon claims or returns regardless of the Party
requesting the return, (iii) freight charges paid for delivery, and (iv) taxes
or other governmental charges levied on or measured by the invoice amount
whether absorbed by the billing or the billed Party.

         1.13 The term "Patent Rights" shall mean all patent applications filed
in any country which claim the benefit of the filing date of any of the patents
or applications listed on Exhibit 1.2 including all continuing, divisional, and
renewal applications thereof, all patent applications, all patents which may be
granted thereon, and all reissues, re-examinations and extensions thereof, and
including all patents and patent applications which later issue into patents
that are owned, licensed currently or at some future time become controlled by
SSC having at least one Valid Claim which covers a Licensed Products.

         1.14 Reasonable Commercial efforts shall have the meaning set forth in
Section 12.2.

         1.15 The term "Safety Syringe Products" shall mean any hypodermic
needle, hypodermic needle/syringe combination, insulin/TB syringe, spinal
needles, epidural needle, filtered needle, medication transfer needle, biopsy
needle/kit, arterial blood gas needle/syringe, needles for plastic pre-filled
syringe applications and dialysis kits (listed in Exhibit 1.3) that would, but
for the assignment made herein, infringe any Valid Claim of an issued patent
included in Patent Rights

         1.16 "Second Minimum Annual Royalty" shall have the meaning as set
forth in Section 3.2.

         1.17 The term "Technical Information" shall mean inventions, know-how,
and trade secrets relating to Licensed Products that are currently or at some
future time become owned, licensed or controlled by SSC as well as improvements
thereof.

                                     Page 2
<PAGE>

         1.18 The term "Term" of the Agreement shall mean the period of time
commencing on the Effective Date and ending on the date of the expiration of the
last of the issued patents to expire included in the Patent Rights, unless
earlier terminated in accordance with Article 12.

         1.19 The term "Valid Claim" shall mean a claim of an issued patent
which has not lapsed or become abandoned and which claim has not been declared
invalid or unenforceable by a final non-appealable decision or judgment of a
court of competent jurisdiction.

                       ARTICLE 2 - ASSIGNMENT AND LICENSE

         2.1 Concurrent with the payment of the ** dollars ($**) pursuant to
Section 3.1 a), SSC shall execute an assignment using a copy of the forms
attached hereto as Exhibit 2.1, irrevocably transferring to Kendall all rights
title and interest to patents and patent applications listed in Exhibit 1.2 B.
The Parties acknowledge that monies paid and obligations met by Kendall prior to
the Effective Date pursuant to the First Development and License Agreement were
in consideration for the patents and patent applications listed in Exhibit 1.2 A
that were assigned to Kendall prior to the Effective Date.

         2.2 Kendall agrees to grant and hereby does grant to SSC, and any SSC
Affiliate designated in writing by SSC, an exclusive, royalty free, worldwide
license, with the right to sublicense others, to make, have made, use and sell
Excluded Products. In the event Kendall decides to develop any Excluded
Products, Kendall will notify SSC of its intent in writing and Kendall will be
given the right to negotiate in good faith an expansion of the rights granted
herein to cover such product, assuming SSC has the rights to grant.

         2.3 In the event that Kendall decides to license Patent Rights to third
parties for any reason other than to sell the all or part of Safety or Blood
collection products business or supply Kendall with components or finished
Licensed Products, Kendall will notify SSC in writing of its intent and SSC will
be given a first option to negotiate for an exclusive or non-exclusive license
on terms to be negotiated in good faith to commercially use the Patent Rights
for Safety Syringe Product and/or Blood Collection Products. In the event the
Parties have not agreed on terms for such a license within ninety (90) days of
said receipt by SSC, Kendall may thereafter be free to offer a license to any
independent third party.

---------------
The "**" marks the location of information that has been omitted and filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.

                                     Page 3
<PAGE>

                               ARTICLE 3 - PAYMENT

         3.1 Kendall shall pay SSC:

                  a) ** dollars ($**) within ten (10) days of the Effective
         Date;

                  b) one million five hundred thousand dollars ($1,500,000)
         within thirty days (30) of the First Safety Syringe Commercial Sale
         Date; ** dollars ($**) within ten (10) days of the date when the
         assignment of the rights to the 510k clearance relating to Blood
         Collection Products are executed and transferred to Kendall; ** dollars
         ($**) within thirty days (30) of the date of the First Blood Collection
         Commercial Sale Date;

                  e) five hundred thousand dollars ($500,000) of the fee paid
         pursuant to Section 3.1 b) will be credited toward annual royalty
         payment owed pursuant to Section 3.1f);

                  b) f) an annual royalty payment in the amount of ** percent
         (**%) on Net Sales of Licensed Products by Kendall and its Affiliates
         and licensees.

         3.2 Kendall shall have the following minimum annual royalty
obligations:

                  a) relative to Safety Syringe Products, Kendall shall have a
         minimum annual royalty obligation of five hundred thousand dollars
         ($500,000) payable for year one (1) on the first anniversary of the
         First Safety Syringe Commercial Sale Date and one million dollars per
         year ($1,000,000) payable on the second and third anniversary dates of
         the subsequent two years (hereinafter "First Minimum Annual Royalty");
         and

                  b) relative to Blood Collection Products, Kendall shall have a
         minimum annual royalty obligation of ** dollars ($**) payable for year
         one (1) on the first anniversary of the First Blood Collection
         Commercial Sale Date and ** dollars per year ($**) payable on the
         second and third anniversaries of the subsequent two years regards to
         Blood Collection Products (hereinafter "Second Minimum Annual
         Royalty").

         3.3 Except as provided in Article 10, in any year in which the royalty
that is required in Section 3.1 f) does not meet or exceed the amount of the
minimum royalty due under Section 3.2, Kendall shall, with the payment made for
that year, pay an amount as additional royalty sufficient to bring the total
royalties payable for such year up to an amount equal to the minimum royalty
required hereby. Any payments pursuant to Section 3.2 or this Section 3.3, shall
be made within sixty (60) days of the date the payment is due.

         3.4 No royalty shall be payable on sales of any Licensed Products
between Kendall and any Affiliate or licensee, and only one (1) royalty shall be
payable hereunder with respect to the sale of any one (1) Licensed Products no
matter how many patents or claims may cover the Licensed Products.

         3.5 Kendall's obligation to pay royalties in any given country with
respect to the sale of Licensed Products shall terminate upon expiration of the
last patent to expire included in the Patent Rights covering such Licensed
Products in a given country.

---------------
The "**" marks the location of information that has been omitted and filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.

                                     Page 4
<PAGE>

         3.6 Kendall shall keep accurate books and records of sales of Licensed
Products and of all payments due SSC hereunder for one year after the Term of
the Agreement. Kendall shall contractually obligate all Kendall licensees to
keep accurate books and records of Net Sales of Licensed Products and of all
data necessary for the computation of royalties hereunder for the relevant sale
period. Kendall shall deliver to SSC written reports of Net Sales of Licensed
Products for the calendar quarter in which the Licensed Products was sold, on or
before the sixtieth (60th) day following the end of the calendar quarter. Such
reports shall include a calculation of the royalties due and be accompanied by
payment of the monies due. For avoidance of doubt the calendar quarters end on
March 31, June 30, September 30 and December 31.

         3.7 SSC shall have the right to nominate an independent accountant
acceptable to and approved by Kendall who shall have access to Kendall and/or
its Affiliates' and/or its sublicensees records during reasonable business
hours, upon executing an appropriate confidentiality agreement, for the purpose
of verifying the royalty payable as provided for in this Agreement for the two
(2) preceding years, but this right may not be exercised more than once in any
year, and the accountant shall disclose to SSC only information relating solely
to the accuracy of the royalty report and the royalty payments made in
accordance with this Agreement. Kendall shall impose similar contractual
obligations on its sublicensees to allow an independent public accountant to
inspect the sublicensee's books and records to verify payments under such
sublicense.

         3.8 Royalty payments under this Agreement shall be made in United
States dollars.

         3.9 Any sum required under United States tax laws, or the tax laws of
any other country, to be withheld by Kendall from payments shall be promptly
paid by Kendall to the appropriate tax authorities, and Kendall shall furnish
SSC with official tax receipts or other appropriate evidence issued by the
appropriate tax authorities sufficient to enable SSC to support a claim for
income tax credit in respect of any sum so withheld.

         3.10 Except for the circumstances relating to infringement outlined in
Sections 10.2 and 10.4, Kendall guarantees to pay SSC nine hundred and ten
thousand dollars ($910,000) for the milestone payments for Blood Collection
Products pursuant to Section 3.1 c), and d) and the annual minimum royalties for
Blood Collection Products pursuant to Section 3.2 b) (payments itemized below)
within the time frame specified in the appropriate Sections, regardless of
whether this Agreement is terminated pursuant to Article 12.1 b). In the event
Kendall terminates pursuant to 12.1.b), the payment pursuant to 3.1 c) and d)
($** + $** = $**), listed below, will become due within ninety (90) days from
the date Kendall mails a notice of termination to SSC. Subsequent payments (also
listed below) for only the first three years of the Second Minimum Annual
Royalty (Year 1, Year 2 and Year 3) will become due within ninety (90) days from
January 1, 2003 ($**), January 1, 2004 ($**) and January 1, 2005 ($**),

---------------
The "**" marks the location of information that has been omitted and filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.

                                     Page 5
<PAGE>

respectively. However, said payments will not be made for Blood Collection
Products: (i) if payment already has been paid pursuant to Sections 3.1 and/or
3.2 before the date of termination; (ii) if the Agreement is terminated due to
material breach by SSC; (iii) if Kendall terminates due to court order
preventing the sale of Blood Collection Products; or (iv) if Kendall terminates
due to settlement or court order related to patent infringement requiring the
payment for damages and/or monies to a third party.

                                                            Blood Collection
                                                          -------------------
3.1 c) Milestone (510K Clearance)                                  $**
3.1 d) Milestone (First Blood Collection...Sale)                   $**
3.2 Second Minimum Annual Royalty (Year 1)                         $**
3.2 Second Minimum Annual Royalty (Year 2)                         $**
3.2 Second Minimum Annual Royalty (Year 3)                         $**
                                                          -------------------
TOTAL                                                           $910,000

                      ARTICLE 4 - RESEARCH AND DEVELOPMENT

         4.1 During the Term of this Agreement, SSC and Kendall shall each use
reasonable commercial efforts to develop the Licensed Products consistent with
the project funding, product requirement documents, the development schedule and
projected product launch dates found in Exhibits 1.3, 4.1, 4.2 and 4.3 or such
other specifications as may be mutually approved by the Parties. Kendall shall
fund SSC for its development of the Licensed Products relative to FlexLoc(R) and
ReLoc(TM) syringes up to a maximum amount of ** dollars ($**) in accordance with
the development schedule and key project milestones found in Exhibit 4.1. At
Kendall's option, Kendall shall fund SSC for its development of the Licensed
Products relative to Blood Collection Products to a maximum amount of ** dollars
($**) in accordance with the development schedule and key project milestones.
The Parties agree that the development funding may be amended by the mutual
written agreement of the Parties. Development costs exceeding the maximum
amounts identified above shall be approved in writing by the Parties before
commencing such work. Kendall agrees to keep SSC apprised of its development and
marketing efforts.

         4.2 SSC shall perform and be responsible for the design and development
of FlexLoc(R)and ReLoc(TM)products as described in the development schedule in
Exhibit 4.3 through the design input and design output phases of the project.
Kendall shall be responsible for design verification, design validation,
regulatory submissions and activities and bringing the product to market. SSC,
at Kendall's expense, shall assist and cooperate with Kendall through the design
verification, design validation, regulatory submission and activities and
bringing the products to market. It is recognized that the product funding and
project development schedules set forth in Exhibit 4.1 and 4.3

---------------
The "**" marks the location of information that has been omitted and filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.

                                     Page 6
<PAGE>

are for ** needle sizes for each of FlexLoc(R) and ReLoc(TM) syringe needles.
This includes preparation of all applications to the United States Food and Drug
Administration, whether by application for premarket approval or 510(k)
notification, or otherwise.

         4.3 In the event Kendall requests SSC to perform Blood Collection
Products development , SSC shall perform and be responsible for the design and
development of Blood Collection Products pursuant to a mutually agreed upon
development schedule through the design input and design output phases of the
project. Kendall shall be responsible for design verification, design
validation, regulatory submissions and activities and bringing the product to
market. SSC, at Kendall's expense, shall assist and cooperate with Kendall
through the design verification, design validation, regulatory submission and
activities and bringing the products to market. This includes preparation of all
applications to the United States Food and Drug Administration, whether by
application for premarket approval or 510(k) notification, or otherwise.

         4.4 Projected product launch dates for other Included Products are set
forth in Exhibit 1.3. In the event an Included Products is not launched within
one year of the projected launch date listed in Exhibit 1.3, then such product
shall become an Excluded Products unless otherwise agreed in writing by the
Parties.

         4.5 When ReLoc(TM)is launched, Kendall agrees to provide **.

         4.6 The Parties shall attempt in good faith to resolve any dispute
relating to the development effort by negotiations between executives who have
authority to settle the controversy. Any Party may give the other Party written
notice of any dispute not resolved in the normal course of business together
with a request that the Parties meet and confer. Within twenty (20) days after
delivery of the notice of dispute, executives of both Parties shall meet at a
mutually acceptable time and place, and thereafter as often as they reasonably
deem necessary, to exchange relevant information and to attempt to resolve the
dispute. If the matter has not been resolved within sixty (60) days after
delivery of the notice of dispute, either Party may seek remedies at law.

                       ARTICLE 5 - FUNDING OF DEVELOPMENT

         5.1 Funding under the development of the Licensed Products shall be
paid for by Kendall within forty five (45) days of the date Kendall has
reasonably determined that SSC has met the monthly milestones objectives set
forth in Exhibit 4.1 and has been invoiced by SSC or has otherwise been mutually
agreed to by the Parties in writing.

         5.2 Changes to the development schedule found in Exhibit 4.3 or the key
project milestones and funding schedule found in Exhibit 4.1 shall be proposed
in writing by either Party and adopted as an amendment to the respective
Exhibits only after receipt of written approval by both Parties.

---------------
The "**" marks the location of information that has been omitted and filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.

                                     Page 7
<PAGE>

                   ARTICLE 6 - RESEARCH REPORTS AND OVERSIGHT

         6.1 The Parties shall each furnish to the other written monthly
informal reports on the progress of the development of the Licensed Products.
6.2 The Parties shall each name a key research and development and marketing
contact through which day-to-day contact and decision-making may be made and to
facilitate communication between the Parties. Each Party will make reasonable
effort to timely respond to all questions and requests from the other Party. A
key contact person may be changed from time-to-time by notifying the other Party
of the change in its key contact person.

                       ARTICLE 7 - PROPRIETARY INFORMATION

         All proprietary information of any Party to this Agreement disclosed to
another Party in connection with the development of the Licensed Products and
identified in writing and marked by the disclosing Party as confidential will be
treated by the receiving Party and its employees as confidential throughout the
Term of this Agreement and for an additional five (5) years. The above-mentioned
obligation of confidentiality shall not apply to information which: (i) at the
time of the disclosure was known to the receiving Party as evidenced by written
records and was not previously subject to any obligation of confidentiality; or
(ii) was generally available to the public or otherwise part of the public
domain at the time of its disclosure; or (iii) becomes generally available to
the public or otherwise part of the public domain after its disclosure other
than through an act of omission or commission of the receiving Party in breach
of this Agreement; or (iv) becomes known to the receiving Party by disclosure of
a third party under no obligation of confidentiality to the disclosing Party; or
(v) was independently developed by a Party, its agent or Affiliate without
reliance on the disclosed proprietary information.

        ARTICLE 8 - OWNERSHIP OF PATENT RIGHTS AND TECHNICAL INFORMATION

         8.1 Each Party will jointly own title to any and all technical
information and inventions first conceived jointly or discovered jointly by
Kendall's employees and SSC's employees or personnel during the Term, which
falls outside the scope of the Patent Rights and/or Technical Information. SSC
agrees to promptly assign to Kendall all right, title and interest to any joint
inventions, which fall within the scope of Patent Rights and Technical
Information. For those inventions outside of the scope of Patent Rights and
Technical Information, SSC agrees to grant to Kendall an option to an exclusive
worldwide license on all rights to such jointly conceived inventions on terms to
be negotiated in good faith. Kendall agrees to grant to SSC an option to an
exclusive worldwide license on all rights to such jointly conceived inventions,
outside the scope of the Patent Rights and Technical Information, on terms to be
negotiated in good faith.

         8.2 Each Party who retains the services of a consultant to provide
technical services in accordance with the development effort should require
their consultants to execute agreements protecting the proprietary information
of the other Party and assign all rights to intellectual property in accordance
with the terms of this Agreement.

                                     Page 8
<PAGE>

                           ARTICLE 9 - PATENT FILINGS

         9.1 Unless otherwise agreed, Kendall shall pay the patent filing,
prosecution and maintenance costs in the jurisdictions identified in Exhibit
9.1. SSC shall identify those additional jurisdictions outside the United States
where it would like Kendall to file, prosecute and maintain patent protection
with regard to patents and patent applications that are not listed in Exhibit
9.1. If Kendall plans to sell Licensed Products in such jurisdictions, then
Kendall shall pay all patent filings, prosecution and maintenance costs in those
foreign jurisdictions. Such applications shall be filed and prosecuted utilizing
patent counsel selected by Kendall. Should Kendall elect not to file such patent
application or applications in jurisdictions other than those identified in
Exhibit 9.1, SSC may elect to have Kendall file and prosecute such patent
application or applications in Kendall's name wherein SSC will reimburse Kendall
for all related costs.

         9.2 With respect to all patent applications referred to above, the
Parties shall provide each other with reasonable opportunity to advise the other
and shall cooperate with each other in the prosecution of all patent
applications and claims relating thereto.

                            ARTICLE 10 - INFRINGEMENT

         10.1 In the event that there is infringement of the Patent Rights or
Technical Information assigned to Kendall, the Parties shall notify each other
in writing to that effect. During the ninety (90) day period after such notice,
Kendall will have the right, but not the obligation to bring suit against the
alleged infringer. Kendall shall bear the expenses of any suit brought by it and
shall retain all damages or other monies awarded or received in settlement of
such suit. Kendall shall have the final decision on all matters relating to
litigation and any settlement discussions. SSC will use reasonable efforts to
cooperate with Kendall in any such suit and shall have the right to consult with
Kendall and be represented by its own counsel at its own expense. All reasonable
costs incurred by SSC associated with providing such cooperation to Kendall will
be paid by Kendall.

         If, after the expiration of said ninety (90) days from the date of such
notice, Kendall has not brought suit against a third party infringer, then SSC
shall have the right after such ninety (90) day notice period, but not the
obligation, to bring suit against such infringer and join Kendall as a party
plaintiff provided that SSC shall bear all expenses of such suit. SSC shall
retain all damages or other monies awarded or received in settlement of such
suit. Kendall will reasonably attempt to cooperate with SSC in any suit for
infringement of the subject patent brought by SSC against a third party and
shall have the right to consult with SSC and to participate in and be
represented by independent counsel in such litigation at its own expense. All
reasonable costs incurred by Kendall associated with providing cooperation to
SSC shall be paid by SSC. Where it is necessary for SSC to have standing to file
the suit, Kendall shall assign limited concurrent rights to the licensed Patent
Rights for the terms of the suit.

         10.2 In the event SSC has decided to bring suit against an infringer,
it shall use reasonable commercial efforts to abate such infringement. It is
understood that the reasonable commercial efforts under this Section 10.2 shall
include the filing for injunctive relief and all other actions, which could
bring about an early abatement of the infringing activity. Notwithstanding
foregoing, SSC shall not enter into any settlement agreement, or take any
position in litigation, which adversely impacts Kendall's rights under this
Agreement without written consent by Kendall.

         During the period commencing with Kendall's filing of a complaint for
infringement of the Patent Rights or Technical Information and ending on a
court's issuance of a final non-appealable decision or other termination of the

                                     Page 9
<PAGE>

proceeding, Kendall's royalty obligation under Section 3.1f) shall be reduced by
fifty percent (50%) and Kendall's obligation to pay a minimum annual royalty
under Section 3.2 shall be suspended. Notwithstanding the foregoing, Kendall's
obligation to pay minimum royalties and any reduction in the royalty obligation
shall not be effective until and unless Kendall has determined in its sole
discretion and in good faith that it's ability to market and sell Licensed
Product is materially affected by the alleged infringement.

         10.3 In the event Kendall is charged with infringement by a third party
for the manufacture, use or sale of Licensed Product, Kendall shall have the
right to defend against such charge of infringement, and during the period in
which such litigation is pending, Kendall shall have the right to withold up to
fifty percent (50%) of the royalties due SSC on sales of the allegedly
infringing Licensed Products and apply it against all its litigation expenses.
If, as a result of judgment in the litigation or settlement with a third party
with or without litigation, Kendall is required to pay royalty and/or other
monies to such third party, Kendall may thereafter deduct from the amount of
royalties due SSC on unit sales of the Licensed Product charged to infringe, an
amount which is the lesser of all royalties and/or other monies paid by Kendall
to such third party, or fifty percent (50%) of all royalty payments otherwise
payable to SSC on the Net Sales of such Licensed Product during Term.

         10.4 With respect to SSC, nothing in this Agreement shall be construed
as:

                  (a) A warranty or representation that any Patent Rights in the
         form of patent applications filed or that may be filed disclosing and
         claiming any aspect of the Included Products will mature into issued
         patents; or

                  (b) An obligation to bring, defend or prosecute actions or
         suits against third parties for infringement of any Patent Rights.

         10.5 Except for a breach of SSC's representation and warranties, in the
event a complaint for patent infringement is filed against Kendall, Kendall's
remedies against SSC shall be limited to those remedies expressly set forth in
this Article 10.

         10.6 In the event there is any dispute as to whether a particular
product falls under the designations listed in Exhibit 1.3 as "Included Products
" or "Excluded Products ", the Parties agree to attempt to resolve such disputes
by negotiations between executives who have authority to settle the matter. Any
Party may give the other Party written notice of any dispute not resolved in the
normal course of business together with a request that the Parties meet and
confer. Within twenty (20) days after delivery of the notice of dispute,
executives of both Parties shall meet at a mutually acceptable time and place,
and thereafter as often as they reasonably deem necessary, to exchange relevant
information and to attempt to resolve the dispute. If the matter has not been
resolved within sixty (60) days after delivery of the notice of dispute, either
Party may seek remedies at law.

                          ARTICLE 11 - INDEMNIFICATION

         11.1 SSC agrees to indemnify Kendall, for all costs associated with any
claims, liabilities, suits or judgments arising out of sublicenses to Excluded
Products granted by SSC pursuant to the First Development and License Agreement
and this Agreement.

                                    Page 10
<PAGE>

         11.2 Kendall agrees to indemnify SSC, for all costs associated with any
claims, liabilities, suits or judgments arising out of Kendall's use of Patent
Rights and Technical Information.

         11.3 Kendall assumes complete liability for and will indemnify and hold
SSC and its Affiliates harmless against all liabilities, demands, damages,
expenses, or losses, including, without limitation, reasonable fees for
attorneys, expert witnesses and litigation costs, and including costs incurred
in the settlement or avoidance of any such claim, which result from or are in
connection with any claims of or in connection with any bodily injury (including
death) or property damage, by whomsoever such claim is made, arising out of any
manufacture, use, sale, or other disposition by Kendall or its sublicensees or
its Affiliates of Included Products or use of processes to make the Included
Products.

         11.4 The indemnification and assumptions of liability contained in
Sections 11.1 and 11.2 shall continue in full force and effect after the
termination of this Agreement for a time period specified by the laws of the
State of Delaware.

                            ARTICLE 12 - TERMINATION

         12.1 This Agreement shall commence on the Effective Date and shall
continue thereafter for the Term, unless sooner terminated in accordance with
the provisions of Article 12. Kendall may terminate this Agreement:

                  a) in relation to Safety Syringe Products, at will with
         fifteen (15) days prior written notice to SSC; and/or

                  b) in relation to Blood Collection Products, at will with four
         and half (41/2) months prior written notice to SSC.

                  (c) i. In the event Kendall terminates this Agreement as it
         relates to Safety Syringe Products , without cause, Kendall shall grant
         SSC the right to a worldwide royalty-free exclusive license to Safety
         Syringe Products.

                           ii. In the event Kendall terminates this Agreement as
                  it relates to Blood Collection Products, without cause,
                  Kendall will grant to SSC the right to a worldwide royalty
                  free exclusive license to Blood Collection Products, but only
                  if SSC purchases the Initial Equipment (as defined below) and
                  510K rights from Kendall for ** dollars ($**). The Parties
                  agree that the term "Initial Equipment" shall constitute the
                  Blood Collection manufacturing equipment Kendall purchased
                  from ** for a sum of approximately ** dollars ($**).

---------------
The "**" marks the location of information that has been omitted and filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.

                                    Page 11
<PAGE>

                           iii. In the event Kendall terminates the Agreement as
                  it relates to both Blood Collection Products and Safety
                  Syringe Products, without cause, then Section 12.1 (c) i and
                  ii shall both apply.

         12.2 After the third anniversary of the First Blood Collection Sale
Date as defined in Section 3.2 (b), upon receipt by Kendall of written notice by
SSC that Kendall has not put forth Reasonable Commercial Efforts (as defined
herein), to market Blood Collection Products, the Parties shall meet within
thirty (30) days of receipt of such notice to discuss the issue. Both Parties
agree that "Reasonable Commercial Efforts" means maintaining a level of sales
and marketing commensurate with similar Kendall products generating the same
level of sales as those relating to the Blood Collection Products being sold by
Kendall and stocking a sufficient level of inventory to support such sales.
After said meeting, if SSC does not see that Kendall is maintaining a level of
sales and marketing commensurate with similar Kendall products generating the
same level of sales as those relating to Blood Collection Products being sold by
Kendall and has stocked a sufficient level of inventory to support such sales
then, SSC shall provide a second written notice to Kendall and Kendall will have
ninety days (90) to cure from the date of receipt of said second written notice.
In the event Kendall has not cured by the end of the ninety (90) day period
Kendall will grant SSC the right to a worldwide royalty-free exclusive license
to Blood Collection Products, but only if SSC purchases the Initial Equipment
and the relevant 510K rights from Kendall for ** dollars ($**).

         12.3 Upon the date of receipt of notice of termination for the Blood
Collection Products by SSC pursuant to Section 12.1, SSC will be given a first
option to purchase all of the remaining equipment being used in the manufacture
of the Blood Collection Products at market value on terms to be negotiated in
good faith. In the event the Parties have not agreed on terms for such a
purchase within ninety (90) days of said receipt by SSC, Kendall may thereafter
be free to sell said equipment to any independent third party.

         12.4 Upon the conclusion of the ninety (90) day cure period pursuant to
Section 12.2, SSC will be given a first option to purchase all of the remaining
equipment being used in the manufacture of the Blood Collection Products at
market value on terms to be negotiated in good faith. In the event the Parties
have not agreed on terms for such a purchase within ninety (90) days of said
receipt by SSC, Kendall may thereafter be free to sell said equipment to any
independent third party.

         12.5 Except with respect to cure periods otherwise specified, any
material breach of or material default under this Agreement by either Party, the
other Party, with sixty (60) day written notice, may pursue legal action against
the other Party unless during such sixty (60) day period the breaching Party has
cured such breach or default. In the event a Party pursues legal action, the
Agreement shall terminate only upon a final non-appealable decision by a court
wherein the breaching Party is found to have materially breached said Agreement.

---------------
The "**" marks the location of information that has been omitted and filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.

                                    Page 12
<PAGE>

         12.6 Failure to terminate this Agreement following breach shall not
constitute a waiver of the Party's defenses, rights or causes of action arising
from such or any future breach or non-compliance.

         12.7 The provisions hereof relating to the Parties' obligation of
confidentiality shall survive the termination of this Agreement by five years.

         12.8 The Parties acknowledge that Kendall's assigned rights to the
Patent Rights and Technical Information are irrevocable except as provided in
Section 12.1.

                               ARTICLE 13 - NOTICE

         Any notices given under this Agreement shall be in writing and shall be
deemed delivered and effectively made as of the delivery date if hand-delivered,
or it by telecopy or over night airmail, courier the business day the sender has
written confirmation such telecopy or overnight package was received, or when
sent by First Class mail, postage prepaid, addressed to the Parties as follows
(or at such other addresses as the Parties may notify each other in writing four
business days following deposit in the mail:

                  To Kendall
                        Tyco Healthcare Group LP
                        Attn: Vice President Intellectual Property
                        15 Hampshire Street
                        Mansfield, MA  02048

                  To SSC
                        Safety Syringe Corporation
                        Attn: President
                        585 West 500 South
                        Bountiful, Utah 84101

                              ARTICLE 14 - GENERAL

         14.1 No Party to this Agreement shall employ or use the name of the
other Party in any promotional materials or advertising without the prior
express written permission of such other Party. Nothing herein, however, shall
limit the Parties' right to disclose material information or to make such
disclosures as are required by applicable law.

         14.2 SSC and Kendall each for all purposes related to this Agreement,
shall be deemed an independent contractor of the other, and nothing in this
Agreement shall be deemed to create a relationship of employment or agency, or
to constitute SSC and Kendall as partners or joint ventures.

         14.3 Each Party hereto acknowledges and agrees: (i) that no
representation or promise not expressly contained in this Agreement has been
made by the other Party hereto or by any of its agents, employees,
representatives or attorneys concerning the subject matter of this Agreement;
(ii) that this Agreement is not being entered into on the basis of or in
reliance on, any promise or representation, express or implied, covering the
subject matter hereof other than those which are set forth expressly in this

                                    Page 13
<PAGE>

Agreement; and (iii) that each Party has had the opportunity to be represented
by counsel of its own choice in this matter, including during the negotiations
which preceded the execution of this Agreement.

         14.4 SSC warrants and represents that is has the full right and power
to make the promises and grant the assignments set forth in this Agreement, and
that there are no outstanding agreements, assignments or encumbrances in
existence inconsistent with the provisions of this Agreement. SSC further
warrants and represents that, to the best of its knowledge, the Patent Rights
are valid and SSC has followed all material and applicable patent rules,
procedures and laws in countries where one or more of the Patent Rights have
been filed or have issued.

         14.5 Kendall warrants and represents that it has the full right and
power to make the promises set forth in this Agreement, and that there are no
outstanding agreements, assignments or encumbrances in existence inconsistent
with the provisions of this Agreement.

         14.6 No Party shall be liable for any failure to perform as required by
this Agreement, to the extent such failure to perform is caused by any reason
beyond the Party's control, or by reason of any of the following: labor
disturbances or disputes of any kind, accidents, failure of any required
governmental approval, civil disorders, acts of aggression, acts of God, energy
or other conversation measures, failure of utilities, mechanical breakdowns,
material shortages, disease, or similar occurrences.

         14.7 No Party hereto shall assign this Agreement to any other person
without the prior written consent of the other Party, and any purported
assignment without such consent shall be void; provided, however, that either
party may assign this Agreement to a successor in ownership of all or
substantially all of its business assets related to Blood Collection Products
and/or Safety Syringe Products whether by sale of assets, merger, consolidation
or otherwise.

         14.8 In the event that a court of competent jurisdiction holds any
provision of this Agreement to be invalid, such holding shall have no effect on
the remaining provisions of this Agreement, and they shall continue in full
force and effect.

         14.9 This Agreement, as it amends the First Development and License
Agreement, and the Exhibits hereto contain the entire agreement between the
Parties. No amendments or modifications to this Agreement or the attached
Exhibits shall be effective unless made in writing and signed by an authorized
representative of both parties.

         14.10 This Agreement shall be governed by and construed in accordance
with the laws of the State of Delaware.

         IN WITNESS WHEREOF, the Parties hereto have executed this Agreement by
their duly authorized officers or representatives.

SAFETY SYRINGE CORPORATION           TYCO HEALTHCARE GROUP LP
By  /s/ Jeffrey M. Soinski           By  /s/ Kevin Gould
  ----------------------------         -----------------------------------------
Its: President                       Its: President of Tyco Healthcare Group LP
Date April 24, 2002                  Date April 24, 2002

                                    Page 14
<PAGE>
<TABLE>
<CAPTION>
                                                  EXHIBIT 1.2 A
                                     (Assigned to Tyco Healthcare Group LP)

--------------- ----------------------- ------------- -------------------- ------------ -------------- ---------------
SHPI            Title                   Filing Date   App. No.             Issue Date   Patent No.     Family/Notes
Ref. No.
--------------- ----------------------- ------------- -------------------- ------------ -------------- ---------------
<S>             <C>                     <C>           <C>                  <C>          <C>            <C>
**              Medical Needle Safety   9/10/97       08/927,053           10/20/98     5,823,997      **
                Apparatus and Methods                 EP 1011759
                                                      WO 99/12592
--------------- ----------------------- ------------- -------------------- ------------ -------------- ---------------
**              **                      **            **                   **           **             **
--------------- ----------------------- ------------- -------------------- ------------ -------------- ---------------
</TABLE>

---------------
The "**" marks the location of information that has been omitted and filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.

<PAGE>
<TABLE>
<CAPTION>
                                                  EXHIBIT 1.2 B
                                   (NOT assigned to Tyco Healthcare Group LP)

--------------- ----------------------- ------------- -------------------- ------------ -------------- ---------------
SHPI            Title                   Filing Date   App. No.             Issue Date   Patent No.     Family/Notes
Ref. No.
--------------- ----------------------- ------------- -------------------- ------------ -------------- ---------------
<S>             <C>                     <C>           <C>                  <C>          <C>            <C>
**              **                      **            **                   **           **             **
--------------- ----------------------- ------------- -------------------- ------------ -------------- ---------------
</TABLE>

**
---------------
The "**" marks the location of information that has been omitted and filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.

<PAGE>

                                   EXHIBIT 1.3

Included Product Types

**
Included Product Categories                          Product Launch Date

**
Included Trademarks
o        FlexLoc(R)
o        ReLoc(TM)

Excluded Products include, but are not limited to, the following list of
products that are specifically excluded from Licensed Products:

Excluded Product Categories

**

---------------
The "**" marks the location of information that has been omitted and filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.

<PAGE>

                                  EXHIBIT 2.1

                                   ASSIGNMENT

         SAFETY SYRINGE CORPORATION (the Assignor), a corporation of the State
of Utah and wholly owned subsidiary of Specialized Health Products
International, Inc. having an office at 585 West 500 South, Bountiful, Utah
84010 currently is assigned the entire right, title and interest to MEDICAL
NEEDLE SAFETY APPARATUS AND METHODS, U.S. Patent Number 5,823,997, Issued
October 20, 1999, hereinafter called the "invention."

         TYCO HEALTHCARE GROUP LP (the Assignee), a Delaware Partnership having
an office at 15 Hampshire Street, Mansfield, Massachusetts 02048, desires to
secure the entire right, title and interest in said invention.

         In consideration of $1.00 and other goods and valuable considerations
paid to the Assignor by the Assignee, the receipt and sufficiency of which is
hereby acknowledged, IT IS HEREBY ASSIGNED TO THE ASSIGNEE:

         The entire right, title and interest in said invention and in the
above-identified United States Patent, and reissues or extension of Letters
Patent or Patents granted thereon, and in all corresponding applications filed
in countries foreign to the United States, and in all patents issuing thereon in
the United States and foreign countries.

         It is hereby authorized and requested that the United States
Commissioner of Patents and such Patent Office Officials in foreign countries as
are duly authorized by their patent laws to issue patents, to issue any and all
patents of said invention to the Assignee as the owner of the entire interest,
for the sole use and behoof of the said Assignee, its successors, assigns and
legal representatives.

         This assignment and agreement shall be binding upon the heirs and legal
representatives of the Assignor.

                                          Signed _________________________(L.S.)

STATE OF ___________________  )
                              : ss.
COUNTY OF __________________  )

         On __________, 19____, before me personally appeared
________________________ known to me to be the person described and who signed
the annexed assignment in my presence and acknowledge under oath before me that
he has read the same and knows the contents thereof and that he executed the
same as his free act and deed and for the purposes set forth therein.

(SEAL)                                          ________________________________
                                                 Notary Public

<PAGE>

                                   ASSIGNMENT

         SAFETY SYRINGE CORPORATION (the Assignor), a corporation of the State
of Utah and wholly owned subsidiary of Specialized Health Products
International, Inc. having an office at 585 West 500 South, Bountiful, Utah
84010 currently is assigned the entire right, title and interest to MEDICAL
NEEDLE SAFETY APPARATUS AND METHODS, hereinafter called the "invention."

         Preferred embodiments of said invention are disclosed in a United
States patent application heretofore executed, now identified as U.S. Patent
Application Number 09/118,624, filed July 17, 1998, and which was allowed
February 3, 1999 with issue fees having been duly in full paid April 5, 1999.

         TYCO HEALTHCARE GROUP LP (the Assignee), a Delaware Partnership having
an office at 15 Hampshire Street, Mansfield, Massachusetts 02048, desire to
secure the entire right, title and interest in said invention.

         In consideration of $1.00 and other goods and valuable considerations
paid to the Assignor by the Assignee, the receipt and sufficiency of which is
hereby acknowledged, IT IS HEREBY ASSIGNED TO THE ASSIGNEE:

         The entire right, title and interest in said invention and in the
         above-identified United States Patent application, and reissues or
         extension of Letters Patent or Patents granted thereon, and in all
         corresponding applications filed in countries foreign to the United
         States, and in all patents issuing thereon in the United States and
         foreign countries.

         It is hereby authorized and requested that the United States
Commissioner of Patents and such Patent Office Officials in foreign countries as
are duly authorized by their patent laws to issue patents, to issue any and all
patents of said invention to the Assignee as the owner of the entire interest,
for the sole use and behoof of the said Assignee, its successors, assigns and
legal representatives.

         This assignment and agreement shall be binding upon the heirs and legal
representatives of the Assignor.

                                          Signed _________________________(L.S.)

STATE OF ___________________  )
                              : ss.
COUNTY OF __________________  )

         On __________, 19____, before me personally appeared
________________________ known to me to be the person described and who signed
the annexed assignment in my presence and acknowledge under oath before me that
he has read the same and knows the contents thereof and that he executed the
same as his free act and deed and for the purposes set forth therein.

(SEAL)                                      ________________________________
                                            Notary Public

<PAGE>

                                   EXHIBIT 4.1

**

---------------
The "**" marks the location of information that has been omitted and filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.

<PAGE>

                                   EXHIBIT 4.2

**

---------------
The "**" marks the location of information that has been omitted and filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.

<PAGE>

                                   EXHIBIT 4.3

**

---------------
The "**" marks the location of information that has been omitted and filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.

<PAGE>

                                   EXHIBIT 9.1

**

---------------
The "**" marks the location of information that has been omitted and filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.

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