Document:

HiENERGY TECHNOLOGIES, INC.

                      INTERNATIONAL DISTRIBUTION AGREEMENT

HiENERGY TECHNOLOGIES, INC.         PH:     949.757.0855
1601 ALTON PARKWAY, UNIT B          FAX:    949.757.1477
IRVINE, CA 92606

This AGREEMENT, dated as of the 25th day of July, 2003 , between HiENERGY
TECHNOLOGIES, INC., a Delaware USA corporation. (hereinafter called "Company")
and Electronic Equipment Marketing Company (EEMCO), a corporation duly
registered in Riyadh, Saudi Arabia (hereinafter called "Dealer").

This consideration of the mutual promises herein contained, it is agreed as
follows:

1. SCOPE OF AGREEMENT

Dealer agrees to act as a Dealer of Company on a exclusive basis and in that
capacity Dealer shall purchase for resale or arrange for the sale of car bomb
detection products and services provided by Company of a type listed as follows:
HiEnergy CarBomb Finder Beta-models 301, 302, and 303 (such products and
services hereinafter called the "Products"), within the territory described as
follows: Kingdom of Saudi Arabia Land Forces, Signal Corps, RSAF, Ministry of
Interior and Navy AND the Middle-East countries of Saudi Arabia, , Kuwait,
Qatar, Bahrain, Oman, UAE, Iraq, Yemen, Syria, Jordan, and Lebanon AND North
African countries including Sudan, Libya, Egypt, Morocco, Tunis, Algeria, and
Mauritania (hereinafter called the "Territory"), in accordance with the terms
and conditions set forth in this Agreement. Company will sell to Dealer, or on
Dealer's order as herein set forth.

2. DEALERS OBLIGATIONS

a. The Dealer agrees to promote the sale of the Products in the Territory
aggressively; to contact all potential users and customers and to sell as large
a quantity as possible; to avoid transactions which might call upon Company to
accept obligations inconsistent with Company's terms and conditions of sale or
at unreasonable prices; to refrain from representing, promoting, selling, or
arranging to sell products, accessories, or lines competitive with the Products
in the Territory within the term hereof; and to avoid any and all activity
inconsistent with the foregoing.

b. Dealer will maintain a sales organization, conduct promotional activities,
advertise and distribute promotional material as may be mutually agreed upon
from time to time.

c. Dealer will supply Company with the resale prices for the Territory and will
provide assistance in contract negotiations if and when orders are placed by
Dealer for direct contracting by Company with Dealer's customers.

d. Dealer agrees to actively work on and use all reasonable efforts in securing
the release of bid bonds, performance bonds, bank letters of guarantee and
customer holdbacks in connection with orders placed by Dealer, or directly by
customers with Company.

<PAGE>

In the event that the Dealer requires Company's assistance in securing the
releases of the above, Company will provide Dealer with reasonable support and
assistance in securing any such releases. In such event Dealer and Company with
mutually agree upon cost sharing for such assistance.

e. In situations where Company is selling directly to a foreign government or
government agency, Dealer will not represent Company unless Dealer warrants to
Company that neither Dealer nor any employee or sub-agent of Dealer holds an
official position with said government or government agency.

f. In order to further promote and support the sale of the Products, Company
may, from time to time, wish to provide technical, marketing, or other support
in the Territory to assist the Dealer organization in such activities. It is
envisioned that such support by Company shall be provided on a cost sharing
basis, to be mutually determined on a case-by-case basis.

g. In certain situations, in addition to the normal responsibilities set forth
above, Company may direct Dealer to perform additional services such as
assisting in market surveys; providing maintenance or technical services,
support and assistance; assisting Company personnel traveling in the Territory;
reviewing and editing sales literature for suitability in the Territory; and/or,
providing reasonable assistance to customers not within Dealer's Territory as
defined herein. Dealer agrees to provide such additional services or assistance,
for which Dealer may request reasonable compensation for such services or
assistance.

3. PRICES AND DISCOUNTS

a. Prices to Dealer shall be Company's suggested international list prices, less
international discounts, as may be established by Company from time to time.
Prices and discounts currently in effect have heretofore been conveyed to Dealer
(Appendix A),

b. For installation, or special products, services or projects where no
suggested list prices or discounts are available, Company shall quote to Dealer
the prices to be received by Company net of any discounts or allowances, and
such prices quoted to Dealer shall apply as between HiEnergy and Dealer
regardless of whether Company sells to Dealer, or receives an order directly
from a customer of Dealer, and regardless of the price quoted to, or agreed on
by contract with, such customer.

c. Dealer shall establish prices to customers and, in case of direct contract
between Company and a customer or Dealer, Company shall quote to Dealer's
customer the prices so established by Dealer. Dealer's discount shall be reduced
if prices to such customer are below Company's suggested international list
prices, it being understood that Dealer shall receive from any payments from the
customer only the excess over the net prices due to Company.

4. ORDERS AND ACCEPTANCE

All orders and contracts shall be forwarded to Company at its office in the
United States at the address specified herein. Company reserves the right in its
sole discretion to accept or reject any such order or contract, and normally
will not accept unless specifications, terms of payment, deliveries, terms and
conditions, credit and shipping arrangements are satisfactory to Company. Except
as otherwise agreed in writing, terms and conditions of sale, warranties,
express or implied, and provisions for damages shall be limited as set forth in
Company's Standard Terms and Conditions of Sale in effect at date of order
applicable to the Products.

                                     - 2 -
<PAGE>

5. PAYMENT

a. Payment of the price due Company shall be made in U.S. dollars by a letter of
credit acceptable to Company, payable in sixty (60) days from the date of
shipment against normal shipping documents at a United States bank. Advance
payments or letters of credit from Dealer's customer may be accepted if the
amount due Company or the full resale price is payable to Company, or to an
independent bank or escrow holder satisfactory to Company which guarantees
payment to Company upon its order of the net amount due Company. Any balance due
Dealer from Company or any such bank or escrow holder shall be remitted to
Dealer in accordance with the escrow agreement or as mutually agreed upon.

b. Company may hold back or retain payments due Dealer, or any portions of
Dealer's discount, in an amount necessary to offset Company's exposure for
bonds, guarantees, and customer payment retention which are outstanding.

c. Dealer will reimburse Company for all fees and expenses incurred by the
Company in the said Territory, including cable and confirmation fees incurred by
Company in connection with posting, filing, and maintenance of bonds and letters
of credit and letters of guarantee.

6. WARRANTY

Until otherwise stated, Product shall be sold as a beta-model and not be
warranted by Company unless defect occurs prior to delivery or can be determined
to be a preexisting fault particular to the single unit in question. This
warranty shall not apply to any defect, failure or damage caused by improper use
or improper or inadequate care. Company shall not be obligated to provide
service under this warranty if:

      a)    Damage has been caused by a failure to make a full and proper
            inspection of the Product (as described by the documentation
            enclosed with the Product at the time of shipment) on initial
            receipt of the Product following shipment;

      b)    Damage has been caused by the attempts of individuals, other than
            Company-certified staff, to repair or service the Product;

      c)    Damage has been caused by the improper use or a connection with
            incompatible equipment or product including software applications.

This limited warranty on defects shall remain valid for a period of twelve (12)
months beginning on the day of installation/acceptance of Product. Company shall
replace such defective equipment or parts at no cost to buyer, inclusive of
freight/customs, etc. Service and maintenance will be provided by the Dealer for
beta-models at the expense of the buyer, unless otherwise specified or agreed
upon at time of purchase or thereafter, given the proper amendment is made to
Company's Standard Terms and Conditions of Sale and agreed on by all parties.
Any disputes concerning the warranty shall be settled according to the
APPLICABLE LAW/DISPUTES subsection of this Agreement.

7. COSTS AND EXPENSES

Dealer shall bear all its own costs and expenses, including without limitation
all costs, fees, discounts, wages and salaries of any employees, agents,
sub-agents or experts, except as otherwise specifically authorized in advance in
writing by a duly authorized official of Company. Company's prices do not
include, and Dealer shall pay or cause to be paid, any and all expenses within
the territory related to sales taxes, any other local taxes, license or other
fees, assessments or other charges incident to sale of the Products or levied
against Company's products in Dealer's possession, whether or not title thereto
is in Dealer or Company.

                                     - 3 -
<PAGE>

8. SUB-DEALERS AND REPRESENTATIVES

Subject to Company's advance written approval which shall not be unreasonably
withheld, Dealer may appoint, sub-dealers or representatives within the
Territory provided that: (1) no such arrangement; or any consent of Company
thereto shall in any way modify this Agreement; (2) Dealer shall be fully
responsible for such sub-dealer or representatives, and any agreement between
them shall contain terms consistent with the terms hereof; and (3) Dealer shall
compensate them from its discounts without any cost or liability to Company. If
Dealer should authorize or direct Company to pay to any such sub-dealer any sums
due by Company to Dealer, Company shall deduct any such payment from the amounts
then due to Dealer.

9. REPORTS

Company will require Dealer to submit monthly written reports for each country
or other information with respect to Products sold in the Territory or other
relevant business information. Specifically, describe (1) the sales effort
during the month, (2) the potential buyers, and (3) those that were approached,
but were determined not to be potential buyers and the reasons why.

10. RESTRICTIONS ON EXCLUSIVITY

Dealer agrees that exclusivity shall be cancelled for any country, kingdom, or
other sovereign state within said Territory in which:

      1.    During year one (1) of Agreement, ending August 1, 2004, there is
            either:

            a.    No evident sales contact or effort within the first two (2)
                  months; or

            b.    No identifiable potential buyers with expressed interest
                  within the first six (6) months; or

            c.    No sales within year one (1).

                                       or;

      2.    During year two (2) of Agreement, ending August 1, 2005, there are
            less than 3 sales.

11. TERM AND TERMINATION

a. This Agreement shall commence on the date specified above and shall remain in
effect for a period of one (1) year, unless terminated earlier as provided
herein. After the first year this Agreement shall automatically renew for
successive one year periods, unless either party expresses in writing its
intention not to in advance of the renewal date.

                                     - 4 -
<PAGE>

b. This Agreement may be terminated at any time by either party, effective upon
sixty (60) days written notice by either party to the other. Furthermore, either
party may terminate this Agreement immediately in the event that the other party
has materially breached any of its obligations under the Agreement; or, has been
adjudged a bankrupt, has become insolvent by any test, has filed any petition in
any court of bankruptcy or equivalent court for receivership, reorganization,
bankruptcy, arrangement or relief from debts or creditors, or for any other
relief whatsoever, has had any such petition filed against it, or has made any
assignment for the benefit of creditors or has any substantial part of its
assets subjected to any involuntary lien which is not removed within thirty (30)
days after notice thereof.. In addition Company may terminate the Agreement
effective immediately in the event that Dealer's authorized representative
identified to Company as representing Dealer in the Territory ceases to
represent Dealer.

c. Company agrees to fill all Dealer's orders accepted by Company prior to
termination to the extent the payment provisions hereof can be fully complied
with and Dealer agrees to accept shipment and make payment for such orders, all
in accordance with the provisions of this Agreement; to the same extent as if
termination had not occurred. In the event of termination by reason of cessation
of employment of Dealer's authorized representative, Company shall have the
right to terminate any and all further obligations unless it receives assurances
satisfactory to Company that further obligations of Dealer will be performed.

d. The parties recognize, and acknowledge, that certain provisions contained
herein may conflict with or differ from the laws of the Territory. To the extent
that any provision contained herein is different from, or conflicts with, any
laws of the Territory, the parties hereby waive their rights with respect to
such laws, because it is the express intent of the parties to relay exclusively
on the contractual provisions bargained for and agreed to herein.

12. INDIRECT SALES INTO THE TERRITORY AND HEADQUARTERS ACCOUNTS

a. Notwithstanding any other provisions hereof, this agreement shall not apply
to: (1) sales of services, equipment or goods other than the Products; (2)
United States Government purchases from Company for reshipment into the
Territory; (3) governmentally sponsored or funded military or AID-type programs
conducted under the auspices and/or assistance of the United States Government
or other international agencies, except where Dealer is legally permitted to and
does at the request of Company participate in such programs but in such even
subject to all conditions and limitations thereof.

b. If sales of the Products are made into the Territory by dealers located
outside the Territory, or sales originate in the Territory for delivery outside
the Territory, or sales result front promotional activity of more than one
authorized Company dealer or representative, Company may in its sole discretion
allocate total discount, or other compensation, among one or more of the dealers
or representatives responsible in whole or in part for such sales or orders, but
in no event shall the total amount thereof reduce the company's net price after
discounts below that specified to be received by Company in connection with such
orders or sales.

13. LIABILITIES AND DAMAGES

Company shall not be liable to Dealer, or to any third party claiming through
Dealer for the failure of performance of any obligation under this Agreement
except as specifically set forth herein, or otherwise agreed to in writing.
Additionally, Company shall not, under any circumstances, be liable hereunder
for indirect, special, incidental or consequential damages resulting from its
failure of performance. Any failure to perform any obligation under this
Agreement except payment of monies due, shall be excused if such failure is
caused by acts of God, acts of public authorities, wars and war measures, fires,
casualties, labor difficulties and strikes, shortages of material or fuel,
failure or delays of suppliers or carriers, shortage of transportation, or other
causes beyond the failing party's control.

                                     - 5 -
<PAGE>

14. INSTALLATION AND SPECIAL PROJECTS

It is recognized that from time to time certain orders or projects may call for
installation, construction, facilities or services of a continuing nature within
the Territory, where more than a sale of Company's standard products may be
specified or standard terms of sale, F.O.B. U.S.A., may be applied. For such
special projects, upon Company's written request or pursuant to special written
contract, Dealer may furnish additional services or facilities, serve as a prime
contractor, engage in a protracted pre sales effort, or provide continuing
support during a prolonged performance period, all upon terms and conditions to
be mutually agreed upon.

15. COMPLIANCE WITH LAWS AND GOOD BUSINESS PRACTICES

a. It is expressly understood that this Agreement, and all obligations arising
hereunder, are subject to U.S. Government export control laws and regulations,
including without limitation, the requirement to obtain necessary approvals and
licenses prior to the acceptance of any orders, or the export of Products,
hereunder. Such shall also apply, by way of example only, to spare parts,
warranty items delivered by Company in connection with the Products and the
transfer or re-export of any such Products by Dealer or Dealer's customer
thereafter. During the term of this Agreement, and thereafter, any Products
purchased by or provided Dealer hereunder, including any technical data or
documentation pertaining thereto, shall not be sold, leased, released, assigned,
transferred, conveyed or in any manner disposed of, either directly or
indirectly, without the prior written approval of the United States Government,
in accordance with U.S. law.

b. Company agrees to use its best efforts to obtain all necessary U.S.
Government approvals or licenses for export of the Products hereunder. Dealer
agrees to use its best efforts to provide timely and accurate Non-transfer and
Use Certificates (including Form DSP-83 if necessary) to Company, as
appropriate, prior to Company's application for export license and submission of
this Agreement to the appropriate U.S. Government Department to secure the
appropriate export approval.

c. Company shall be excused from performance, and not be liable for damages,
including the assessment of late delivery penalties, for failure to deliver
Products hereunder resulting from the U.S. Government's denial or withdrawal of
approval to export Products to Dealer or Dealer's customers.

d. If Company has reason to believe that Dealer has misrepresented, or failed to
properly disclose, any fact with regard to end users to country of ultimate
destination, Company shall terminate this Agreement for default immediately and
discontinue all performance hereunder.

e. Dealer agrees to comply in all respects with the U.S. Foreign Corrupt
Practices Act of 1977 (FCPA), as amended, which provides generally that: under
no circumstances will foreign officials, representatives, political parties or
holders of public offices be offered, promised or paid any money, remuneration,
things of value, or provided any other benefit, direct or indirect, in
connection with obtaining or maintaining contracts or orders hereunder. When
sub-dealers, representatives or other individuals or organizations associated
with Dealer are required to perform any obligations related to or in connection
with this Agreement the substance of this provision shall be flowed-down and
included in any agreement between Dealer and any such sub-dealers and
representatives. The failure of Dealer to comply in all respects with the
provisions of the FCPA shall constitute a material breach by Dealer of its
obligations hereunder; and, shall entitle Company to terminate the Agreement
immediately.

                                     - 6 -
<PAGE>

16. SUBSIDIARIES OF COMPANY INCLUDED

For purposes of this Agreement the term "Company" shall include subsidiaries, if
any, of HiEnergy Technologies, Inc. which manufacture, sell, distribute, install
or service the Product.

17. APPLICABLE LAW/DISPUTES

This Agreement has been entered into and shall be governed in accordance with
the laws of the State of California, U.S.A. Any differences or disagreements
between the parties arising out of or in connection with the performance by
either party of its obligations under this Agreement will be resolved by mutual
agreement of the parties. Any such differences which cannot be resolved through
management intervention shall be deemed a dispute and be adjudicated by a court
of competent jurisdiction in the State of California. Venue shall lie in County
of Orange, California, and the parties shall submit to personal jurisdiction in
the State of California.

18. GENERAL PROVISIONS

a. Neither party is authorized to act for or bind the other, except as expressly
provided herein. Dealer agrees not to represent itself as an employee, agent, or
commission representative of Company or that its relationship with the Company
is other than that of Dealer, or to enter into any agreement or contract in the
place of Company. Dealer may use Company sales literature and documents
applicable to the Products consistent with compliance with it identification as
a Dealer.

b. Notice and payment to either party shall be sent by cable or telex (confirmed
by registered airmail) addressed to the parties at their addresses above set
forth or at such other address as a party may from time to time designate by
written notice. Any notice shall be deemed to have been given when sent.

c. This Agreement is personal to the parties hereto and shall not be assignable
by either party without the prior written consent of the other.

d. This Agreement shall be governed in all respects by the laws of the State of
California, and any actions for the resolution of disputes arising hereunder
shall be brought in a court of competent jurisdiction located in the State of
California, U.S.A.

e. Dealer agrees to insure at its expense, for the benefit of the Company at the
full insurable value, all Products in Dealers possession, covering all insurable
hazards including without limitation, fire, flood, tornado, collision, riot and
other civil disturbances.

f. The name HiEnergy Technologies, Inc. or any derivative thereof, and any
trademarks or logos associated with the Products are the property of the Company
and may be used only as authorized by Company in writing.

g. The Dealer will not, during or following the terms of this Agreement,
disseminate, disclose or publish information relating to the design or
manufacturing techniques employed by the Company in the production of the
Products, or information relating to research, development, marketing or sales
of the Products of the Company.

                                     - 7 -
<PAGE>

h. Should any of the Products incorporate software or firmware belonging to
Company, Company hereby grants to Dealer a non-exclusive license to use any such
software/firmware with the Products, in accordance with Company's standard
license agreement then in effect. Pursuant to the terms of such standard license
terms, Dealer shall have the right to sub-license a customer of the Products in
the normal use of the software/firmware with the Products.

i. This Agreement cancels and supersedes all prior agreements, understandings,
representations, written or oral, and contains the entire understanding and
agreement of the parties with respect to its subject matter. It states Dealer's
total right to discounts, compensation and reimbursement applicable to any
purchase and resale by Dealer or direct sale by the Company to any customer. No
amendment, modification, waiver or release with respect to this Agreement shall
be effective unless it is in writing signed by a duly authorized representative
of each party and no failure to enforce to take advantage of any provision
hereof shall constitute a waiver.

IN WITNESS WHEREOF, the parties hereto have set their hands the day and year
written.

EEMCO                                      HiEnergy Technologies, Inc. by

By
   --------------------------              ---------------------
                                           Bogdan C. Maglich
                                           CEO

Date                                       Date
     -------------------------                  ----------------

*Please note that this Agreement must be approved by HiEnergy's Members of the
Board prior to its going into effect.

                                     - 8 -CONFIDENTIAL
        TREATMENT REQUESTED: Certain portions of this document have been omitted
        pursuant to a request for confidential treatment and, where applicable, have
        been marked with an asterisk (“[****]”)
        to
        denote where omissions have been made. Note that four pages of this exhibit
        contain omitted material pursuant to this request. The confidential material
        has
        been filed separately with the Securities and Exchange
        Commission.

    

    

      
        	
                genzyme

                 PHARMACEUTICALS

              	
                GENZYME
                  CORPORATION

                CNE
                  KENDALL SQUARE

                CAMBRIDGE,
                  MA 02139-1562, USA

                617-252-7500

                FAX
                  617-252-7772

                www.genzyme.com

              

      

    

     

    
      AMENDED
        AND RESTATED SUPPLY AGREEMENT

       

      THIS
        AMENDED AND RESTATED SUPPLY AGREEMENT (“Agreement”)
        dated as of October
        8, 2003,
        is
        by and between Genzyme Corporation, with principal offices located at One
        Kendall Square, Cambridge, Massachusetts 02139 ("Vendor") and Photogen
        Technologies, Inc., through its IMCOR Pharmaceutical Division, a Nevada
        corporation with its principal offices located at 6175 Lusk Boulevard, San
        Diego, California 92121 ("IMCOR").

       

      WHEREAS,
        Vendor entered into a Supply Agreement with Alliance Pharmaceutical Corp.
        dated
        as of May 16, 2000 (the "Original Supply Agreement");

       

      WHEREAS,
        Photogen Technologies, Inc. has acquired the business of Alliance Pharmaceutical
        Corp. to which the Original Supply Agreement relates;

       

      WHEREAS,
        IMCOR and Vendor now desire to modify the terms of their relationship and
        amend
        and restate the Original Supply Agreement as provided herein;

       

      WHEREAS,
        Vendor has by virtue of its proprietary technologies and know-how developed
        and
        manufactures or by virtue of its distribution relationship with the manufacturer
        has adequate access to the material described on Exhibit "A" attached hereto
        (the "Material"); and

       

      WHEREAS,
        IMCOR
        desires to secure a long-term supply of commercial quantities of
        the
        Material for its product described on Exhibit "A" (the "Product") if and
        when
        such Product
        is
        approved by the FDA and Vendor is willing to supply such quantities of its
        Material to IMCOR as IMCOR's exclusive supplier of the product.

       

      NOW,
        THEREFORE,
        in
        consideration of the mutual promises and covenants set forth herein, the
        parties
        agree as follows.

       

      1.   Supply.
        During
        the term of this Agreement, IMCOR shall purchase all of its requirements
        of
        Material for commercial manufacturing from Vendor and Vendor shall sell to
        IMCOR
        such quantities of the Material as ordered from time to time by IMCOR. Nothing
        herein shall limit Vendor's ability to supply Material to other
        customers.

       

      2.   Duration.
        This
        Agreement shall have effect upon execution and shall remain in effect for
        the
        initial term indicated on Exhibit "A" (the "Term") Thereafter, this Agreement
        shall be renewed automatically for successive two-year periods unless terminated
        by either party by written notice not later than eighteen months prior to
        expiration of the initial term or any renewal period.

       

      3.   Specification
        and Quality Control Standards; GMP Compliance.

       

      3.1   The
        quantities of the Material to be supplied hereunder shall be manufactured
        by
        Vendor in accordance with all applicable laws, rules and regulations, and
        in
conformity
        with the specification and quality control standards set forth in Exhibit
        "B"
        attached
        hereto
        (collectively, the "Specifications"). If IMCOR wishes to change the
        Specifications, Vendor shall use its reasonable endeavors to carry out such
        change subject to agreement on a reasonable change (increase or decrease)
        in
        price, if appropriate, to reflect any costs or savings consequent thereon.
        Vendor shall consult with and must obtain written consent from IMCOR reasonably
        in advance of making any changes in the Specifications, or other aspect of
        the
        production, storage, and transport of Material which would or
        might:

       

      
        
           

        

        
           

          
            

          

        

        
          
            [****]
              Represents material which has been redacted pursuant to a request for
              confidential treatment pursuant to Rule 24B-2 under the Securities
              Exchange Act
              of 1934, as amended. The confidential materials have been filed separately
              with
              the SEC.

          

        

      

       

      
        	 	
                (a)

              	
                Cause
                  a potential change in the Material purity
                  profile;

              

      

       

      
        	 	
                (b)

              	
                Require
                  IMCOR to revalidate its own process or
                  methods;

              

      

       

      
        	 	
                (c)

              	
                Require
                  IMCOR to re-audit Vendor,

              

      

       

      
        	 	
                (d)

              	
                Require
                  IMCOR or Vendor to submit or resubmit any documentation to the
                  FDA.

              

      

       

      Subject
        to the foregoing, Vendor may otherwise alter the Specifications upon sixty
        days
        prior written notice to IMCOR.

       

      3.2   Vendor
        shall make available to IMCOR such data and information in relation to Material
        as is reasonably necessary to ascertain compliance with this Agreement and
        to
        qualify the use of Material in the Product with appropriate regulatory
        authorities. However, nothing
        here shall be construed as placing Vendor under an obligation to disclose
        to
        IMCOR any
        data
        relating to the actual production or purification of the Material except
        as
        Vendor deems appropriate for IMCOR to satisfy itself regarding the security
        or
        quality of supply of the Material or unless IMCOR is required to supply any
        such
        data to any appropriate regulatory authorities,
        in which case Vendor shall provide such information to IMCOR or arrange for
        direct
        disclosure to such regulatory authorities at IMCOR's expense. IMCOR may visit
        and inspect Vendor's facilities used in the Manufacture and testing of the
        Material once per year with reasonable prior notice.

       

      3.3   Vendor
        shall carry out the production and purification of the Material to be supplied
        hereunder in accordance with the U.S. Food and Drug Administration ("FDA")
        and
        Good Manufacturing Practice ("GMP") regulations and shall allow inspection
        of
        Vendor facilities by U.S. or foreign regulatory authority representatives
        to
        enable the said representatives to verify Vendor's compliance with GMP and
        all
        other relevant regulations. Vendor may altar the production and purification
        processes for the Material upon prior written notice to IMCOR but only if
        Vendor
        follows all appropriate regulatory procedures and obtains any relevant
        regulatory approvals and there is no change to the specification and quality
        control standards for the Material.

       

      4.   Estimates
        and Orders.
        As soon
        as practical after the effective date of this Agreement, and within the last
        [****]
        days of
        each calendar quarter thereafter, IMCOR shall deliver to
        vendor
        a [****] month
        rolling Forecast (the "Forecast") of the quantity of material to be purchased
        by IMCOR. The [****]
        of such
        Forecast will be considered a firm
        commitment for production quantities and the remainder of the Forecast shall
        be
        advisory only.
        Accordingly, the [****]
        quantity
        in each subsequent Forecast shall be identical to the [****] quantity
        in the previous "Forecast" unless the parties otherwise agree in
        writing.
        Within
[****]
        days of
        delivery of each Forecast, IMCOR shall submit to Vendor a written delivery
        "Order" for the Material which shall represent the [****]
        firm
        commitment as illustrated by the Forecast.

       

      
        
           

        

        
           

          
            

          

        

        
          
            [****]
              Represents material which has been redacted pursuant to a request for
              confidential treatment pursuant to Rule 24B-2 under the Securities
              Exchange Act
              of 1934, as amended. The confidential materials have been filed separately
              with
              the SEC.

          

        

         

      

      5.   Delivery.
        The
        Material shall be supplied D.D.U. San Diego, California with any and all
        freight
        and packaging expenses being prepaid by Vendor and added to Vendor's invoice
        to
        IMCOR for payment by IMCOR. Title to and risk of loss of the Material shall
        pass
        to IMCOR at the time of delivery to a carrier designated by IMCOR or, if
        not
        delivered but stored by Vendor at IMCOR's request, at the time such Material
        is
        actually segregated and stored in facilities reasonably designed and maintained
        for storage of the materials. All shipments shall meet the specifications
        set
        forth in Exhibit "B" and be accompanied by a Certificate of Analysis. Material
        Orders shall be delivered to IMCOR in accordance with a delivery schedule
        provided by IMCOR in the Order, provided that no delivery be required to
        be made
        within one hundred and twenty (120) days of such Order.

       

      6.   Prices
        and Payment.

       

      6.1   IMCOR
        shall pay the prices specified in Exhibit "C" for the Material delivered
        by
        Vendor.

       

      6.2   The
        price
        does not include sales, use, excise or any other similar taxes imposed by
        Federal, state or local governments, and accordingly such taxes shall be
        paid by
        IMCOR.

       

      6.3   Invoices
        for Material shall be sent to IMCOR on or after the date of shipment of
        Material. Payment shall be made by IMCOR as follows: (1) [****]
        of the
        payment for the Material in the Order (the "Order Payment") shall be paid
        upon
        submission of the Order pursuant to Section 4 hereof, (2) [****]
        of the
        Order Payment shall be due upon delivery of the Material and (3) [****]
        of the
        Order Payment shall be due within [****]
        days
        from the date of invoice, net of any and all invoice fees or other fees or
        charges, other than those specified in this Agreement.

       

      6.4   IMCOR
        shall pay Vendor a fee of [****]
        United
        States dollars [****] per
        calendar quarter (the "Regulatory Fee") for costs incurred by Vendor that
        are
        associated with the filing and maintenance of the Drug Master File (DMF)
        and all
        supporting documentation. The first quarterly Regulatory Fee shall be due
        upon
        execution and delivery of this
        Agreement and the remaining quarterly Regulatory Fees shall be due on the
        first
        day of each calendar
        quarter thereafter;
        provided
        however, that
        if
        IMCOR's total Orders in any calendar year
        exceed
[****]
        United
        States dollars [****],
        IMCOR's
        obligation to pay the Regulatory Fee as set forth in this Section 6.4 shall
        terminate.

       

      7.   Confidentiality.
        Each
        party hereto (a "Recipient") recognizes that the other party hereto and its
        subsidiaries and affiliated corporations (a "Discloser") own or have licensed
        certain confidential information, including but not limited to secret or
        confidential data, proprietary information, trade secrets, technology, formulae,
        processes, procedures, scientific studies, regulatory submissions, business
        plans, information and the like, whether all of the same be in writing or
        not,
        and that Discloser has disclosed or may disclose to Recipient portions of
        such
        confidential information (all of
        which
        is referred to as "Confidential
        Information"). Use of the
        Confidential Information shall
        be
        solely for the purposes of complying
        with
        this
        Agreement. Recipient agrees to maintain the confidential status of such
        Confidential Information and not to disclose the same to persons not authorized
        herein or otherwise authorized in writing by Discloser to receive such
        Confidential Information. Confidential Information shall not include information
        that was (4)
        in the
        public domain prior to the time of its disclosure under this Agreement;
(5)
        entered
        the public domain after the time of its disclosure under this Agreement through
        means other than an unauthorized disclosure resulting from an act or omission
        by
        the receiving party; (6)
        was
        independently developed or discovered by the receiving party prior to the
        time
        of its disclosure under this Agreement; (7)
        is or
        was disclosed to the receiving party at any time, whether prior to or after
        the
        time of its disclosure under this Agreement, by a third party having no
        fiduciary relationship with the disclosing party and having no obligation
        of
confidentiality
        with respect to
        such Confidential
        Information; or (8)
        is
        required to be
        disclosed to
        comply
        with applicable laws or regulations, or with a court or administrative order,
        provided that the disclosing party receives prior written notice of such
        disclosure and that the receiving party takes all reasonable and lawful actions
        to obtain confidential treatment for such disclosure and, if possible, to
        minimize the extent of such disclosure

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      8.   Termination
        / Breach.
        Notwithstanding any other provisions of this Agreement, either party, at
        its
        option, may terminate this Agreement;

       

      8.1   Should
        the other commit an act of bankruptcy, be declared bankrupt, voluntarily
        file or
        have voluntarily filed against it, a petition for bankruptcy or reorganization
        unless such petition is dismissed within 60 days of filing, enter into an
        arrangement for benefit or creditors, enter into a procedure of winding up
        or
        dissolution or should a Trustee or Receiver be appointed for its business,
        assets or operations; or

       

      8.2   Unless
        excused pursuant to Section 14 of this Agreement, upon 120 days written
        notice, should the other fail to comply with or to perform any of its
        obligations under this Agreement
        unless such failure or non-performance is corrected within the 120 day period
        following notification, or such extended period as shall be agreed between
        parties.

       

      8.3   If
        the
        FDA and all applicable foreign agencies fail to approve the Product or
        subsequently rescind the approval of the Product, by giving written notice
        thereof to the other party.

       

      8.4   Notwithstanding
        the foregoing, if Vendor fails to provide the material in accordance with
        this
        Agreement and the Order more that two times, IMCOR may by providing sixty
        (60)
        days written notice, change this Agreement into a nonexclusive purchase
        agreement. If Vendor is able to provide Material within the 60-day notice
        period
        set forth herein, this Agreement shall retain its exclusivity
        provision.

       

      9.   Limited
        Warranty.
        Vendor
        warrants that the Material shall be manufactured in accordance with all
        applicable laws, rules and regulations, according to cGMPs, and in conformity
        with Specifications. This warranty is in lieu of, and VENDOR SPECIFICALLY
        DISCLAIMS AND EXCLUDES, ALL OTHER WARRANTIES, EXPRESS, IMPLIED OR STATORY,
        INCLUDING THE WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR
        PURPOSE.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      10.   Limitation
        of Liability.
        Vendor
        will not under any circumstances be liable to IMCOR for incidental, special
        or
        consequential damages (including, but not limited to, loss of profits, revenue
        or business) resulting from or in any way related to a breach of any
        representation or warranty hereunder. This limitation does not apply to claims
        for personal injury by a third party.

       

      11.   Inspection.
        IMCOR
        shall stole Material under appropriate conditions and not later
        than 45 days after receipt of each consignment of the Material sold hereunder,
        IMCOR shall
        examine
        such consignments of the Material for compliance with the Specifications
        and
        shall notify Vendor of any non-compliance without delay within such 45 day
        period. In the event of any dispute as to the compliance of the Material
        with
        the Specifications, representative samples of the Material will be provided
        to
        an independent testing service (the "Testing Service) that shall
        be
        identified by mutual agreement within ninety (90) days of the date hereof,
        and
        the results
        provided
        by the Testing Service shall be finally determinative. The incorrect party
        shall
        be responsible for all costs incurred by the Testing Service. In no event
        shall
        acceptance relieve Vendor from any obligations under warranties, unless
        non-conformity should reasonably have been detected by IMCOR using reasonable
        diligence. Vendor shall replace any delivery of the Material that the Testing
        Service deems to be non-conforming as soon as possible, but in any event,
        within
        120 days of the date of receipt of notice thereof.

       

      12.   Indemnity.

       

      12.1   IMCOR
        shall indemnify, defend and hold harmless Vendor and its affiliates and each
        of
        their respective directors, officers, employees and agents against all claims,
        losses, damages and expenses, including attorneys' fees (collectively "Losses")
        relating to (9)
        any
        death or personal injury arising from use of the Product containing Material
        purchased hereunder, except those arising as a result of Vendor's negligence
        or
        a breach of Vendor's agreements, and warranties hereunder and (10)
        a breach
        of the terms of this Agreement by IMCOR. Vendor shall notify IMCOR of any
        such
        claim received by Vendor and IMCOR shall have the right to control the conduct
        of the defense or settlement of the claim. IMCOR shall at its own expense
        keep
        in force during the term of this Agreement as well as for a period of ten
        years
        thereafter adequately funded self-insurance or policies of insurance. Such
        insurance should provide coverage to the extent required by local laws and
        pharmaceutical industry practice. IMCOR shall upon the request of Vendor
        provide
        Vendor with a certificate of insurance or other documentation as proof of
        the
        insurance requirement herein.

       

      12.2    Vendor
        hereby agrees to
        indemnify, defend and hold harmless IMCOR and its affiliates, and each of
        their
        respective directors, officers and employees and agents, from and against
        any
        and all Losses incurred by IMCOR, based on or arising out of Vendor's breach
        of
        the limited warranty as set forth in Section 10 herein or Vendor's negligence.
        Vendor agrees to
        maintain in effect for the term of this Agreement and ten years thereafter
        adequately funded self-insurance or policies of insurance providing coverage
        to
        the extent required by local law and pharmaceutical industry
        practice.

       

      13.   Generic
        Drug Enforcement Act of 1992.
        Vendor
        represents that it and its employees have never been (11)
        debarred
        or (12)
        convicted of a crime for which a person can be debarred, under Section 306(a)
        or
        306(b) of the Generic Drug Enforcement Action of 1992. Vendor represents
        that it
        has never been and, to the best of its knowledge after due inquiry, none
        of its
        employees, affiliates or agents has ever been (a) threatened to be debarred
        or
        (b) indicted for a crime or otherwise engaged in conduct for which a person
        can
        be debarred, under Section 306(a) or (b). Vendor agrees that it will promptly
        notify IMCOR in the event of any such debarment, conviction, threat or
        indictment.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

         

      

      14.   Force
        Majeure.
        If the
        performance by any party of any obligation under this Agreement
        other than the payment of money, is prevented or impaired by Force Majeure
        for
        any
        cause
        beyond the reasonable control of the defaulting party, such party shall be
        excused from performing so long as such situation continues to prevent or
        impair
        performance; provided the party
        claiming such excuse shall have promptly notified the other party of the
        existence, nature, duration
        and other details of such cause and shall at all times use its reasonable
        effort
        to resume a complete
        performance. If any party anticipates that a Force Majeure may occur that
        party
        shall
        notify
        the other immediately and explain the nature, details and expected duration
        thereof. The affected party will advise the other from time to time as to
        the
        progress in remedying the situation and as to the time when the affected
        party
        expects to resume its obligations and shall notify the others as to the
        expiration of any Force Majeure as soon as the affected party knows the
        date
        thereof. "Force Majeure" shall mean an event beyond the reasonable control
        of a
        party including,
        but not limited to, fire, flood, sabotage, shipwreck, embargo, explosion,
        accident, riot,
        act of
        governmental authority (including, without limitation, acts relating to raw
        material or product allocation), acts of God and acts of war.

       

      15.   Records.
        All
        records relating to the manufacture of Material shall be retained for a period
        of not less than five years from the date of manufacture of Material or six
        months from the expiration of the final released Material, whichever is later.
        Prior to the destruction of any record, written notice shall be provided
        to
        IMCOR and IMCOR shall have the right to request and retain said
        records.

       

      16.   Notices.
        Any
        notice required or permitted to be given or made under this Agreement
shall
        be
        in
        writing and sent by telefax or registered letter or by recognized overnight
        courier (i.e. Federal Express) to the other party at its address indicated
        on
        the first page of this Agreement, or to such other address as the addressee
        shall have furnished in writing. Notice shall be deemed received three days
        after deposit in the mail or, if sent by courier or facsimile, upon
        receipt.

       

      17.   Entire
        Agreement.
        The
        terms and provisions contained in this Agreement, constitute the entire
        Agreement between the parties with respect to the transactions contemplated
        hereby and shall supersede all previous communications. Representations,
        agreements or understandings, either oral or written, between the parties
        hereto
        with respect to the subject matter hereof, and no agreement or understanding
        varying or extending this Agreement will be binding upon either party hereto,
        unless in writing and signed by both parties.

       

      18.   Non-Waiver.
        Failure
        to terminate this Agreement following breach or failure to comply with this
        Agreement, shall not constitute a waiver of a party's defenses, rights or
        causes
        of action arising from such or any further breach or non-compliance. Any
        waiver
        must be expressly in writing. The waiver by any of the parties to this Agreement
        of any breach of any provision hereof by the other party or parties shall
        not be
        construed to be a waiver of a succeeding breach of such provisions or a waiver
        of the provision itself.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

         

      

      19.   Severability
        and Survival.
        If and
        to the extent that any court, arbitrator or tribunal of
        competent jurisdiction holds any of the terms, provisions or conditions or
        parts
        thereof of this Agreement
        or the application hereof to any circumstances, to be invalid or to be
        unenforceable in a
        final
        non-appealable order, the remainder of this Agreement and the
        application of such terms, provisions
        or conditions or parts thereof to circumstances other than those as to which
        it
        is held
        invalid
        or unenforceable shall not be affected thereby, and each of the other terms,
        provisions and conditions of this Agreement shall be valid and enforceable
        to
        the fullest extent of the law. Sections 7, 10 and 12 shall survive and
        termination of this Agreement.

       

      20.   Assignment.
        Neither
        party shall at any time, without the prior written consent of the other party
        assign or otherwise transfer its rights or obligations under this Agreement
        in
        whole or in part to any other party whatsoever, provided that either party
        may
        assign or transfer its rights and obligations hereunder to a third party
        as part
        of a divestment or licensing of all or substantially all of the business
        to
        which this Agreement pertains and has the resources to comply with the terms
        of
        this agreement.

       

      21.   Controlling
        Provisions.
        In
        ordering and delivering supplies of the Material the parties may employ their
        standard forms; however, nothing contained on such forms shall be construed
        to modify, amend, add to or delete the terms of this Agreement and in the
        event
        of any
        conflict
        between them, the terms of this Agreement shall prevail.

       

      22.   Arbitration
        and Governing Law.

       

      22.1   In
        the
        event that any dispute arises out of this Agreement, the parties shall endeavor
        to settle such dispute amicably between themselves. In the event that the
        parties fail to achieve
        an amicable settlement of any such dispute, that dispute shall be submitted
        to
        arbitration under
        the
        commercial arbitration rules of the American Arbitration Association and
        the
        award or
        decision
        made in such arbitration shall be final and binding upon the
        parties.

       

      22.2   This
        Agreement shall be governed by and construed and interpreted in accordance
        with
        the laws of the State of New York, with disregard to its conflicts of law
        rules.

       

      23.   Relationship
        of Parties.
        The
        relationship of parties under this Agreement is that of independent contractors.
        No party shall be deemed to be the partner or agent of the other, and no
        party
        is authorized to take any action binding upon the other.

       

      IN
        WITNESS WHEREOF, Vendor and IMCOR have caused this Agreement to be executed
        by
        their duly authorized officers as of the day and year first written
        above.

       

      
        	
                IMCOR,
                  A DIVISION OF PHOTOGEN

                TECHNOLOGIES,
                  INC.

                JACK
                  DEFRANCO

                 

                By:
                  /s/ Jack DeFranco

                Title:
                  Senior Vice President

              	
                GENZYME
                  CORPORATION

                DANIEL
                  O’NEIL HAYDEN

                 

                 

                By:
                  /s/ Daniel O’Neil Hayden

                Title:
                  Senior Vice President & General
                  Manager

              

      

      
        
           

        

        
           

          
            

          

        

        
          
            [****]
              Represents material which has been redacted pursuant to a request for
              confidential treatment pursuant to Rule 24B-2 under the Securities
              Exchange Act
              of 1934, as amended. The confidential materials have been filed separately
              with
              the SEC.

          

        

      

      Exhibit
        "A"

      to
        Supply
        Agreement

      between
        IMCOR, a Division of Photogen Technologies, Inc.

      and

      Genzyme
        Corporation

      

      
        	
                 

                1.

              	
                 

                Vendor
                  Material:

              	
                 

                1,2-Dimyristoyl-sn-glycero-3-phosphocholine,
                  Genzyme product code # LP-04-058, DMPC

              
	 	 	 
	
                2.

              	
                IMCOR
                  Product:

              	
                IMAGENT
                  ® perflexane lipid microspheres

              
	 	 	 
	
                3.

              	
                Contract
                  Term:

              	
                [****]
                  years

              
	 	 	 
	
                4.

              	
                Pricing:

              	
                A.
                  See Exhibit "C"

                 

                B.
                  If government regulations or similar mandatory requirements cause
                  the
                  cost to Vendor or raw materials to vary substantially, the
                  parties
                  shall meet to agree to a corresponding variation in the price of
                  the
                  Material.

              
	 	 	 
	
                5.

              	
                Primary
                  Contact:

              	
                A.
                  IMCOR

                 

                A
                  Division of Photogen Technologies, Inc.

                Address:
                  6175 Lusk
                  Boulevard, San Diego, CA 92121

                Phone:
                  (858) 410-5601

                Fax:
                  (858) 410-5602

                 

                B.
                  Vendor Genzyme Corporation

                Name:
                  William DeVroom

                Address:
                  One Kendall Square, Cambridge, MA 02139 

                Phone:
                  (800) 868-8208

                Fax:
                  (617) 252-7772

              

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      Exhibit
        "B"

      to
        Supply
        Agreement

      between
        IMCOR, a Division of Photogen Technologies, Inc.

      and

      Genzyme
        Corporation

      

      SPECIFICATIONS
        AND QUALITY CONTROL STANDARDS

       

      See
        attachment "Component Purchase Specifications"

       

      
        
           

        

        
           

          
            

          

        

        
          
            [****]
              Represents material which has been redacted pursuant to a request for
              confidential treatment pursuant to Rule 24B-2 under the Securities
              Exchange Act
              of 1934, as amended. The confidential materials have been filed separately
              with
              the SEC.

          

        

      

      Exhibit
        "C"

      to
        Supply
        Agreement

      between
        IMCOR, a Division of Photogen Technologies, Inc.

      and

      Genzyme
        Corporation

      

      (SUBJECT
        TO MODIFICATION]

       

      PRICING

       

      Increments
        purchased shall be aggregated with all purchases in the same year, with the
        total amount purchased reset to 0 on each January 1 during the term, and
        priced
        according to the schedule
        below. For example, if [****]
        kg was
        purchased in a calendar year, the first [****]
        kg would
        be
        priced
        at [****]
        and the
        additional [****]
        kg would
        be priced at [****]
        per
        kg.

       

      
        	
                Product

                 

              	
                Amount
                  Purchased (kg)

                 

              	
                Price
                  per kg ($)

                 

              
	
                1,2-Dimyristoyl-sn-

                glycero-3-phosphocholine,

                Genzyme
                  product code #

                LP-04-058,
                  DMPC

                 

              	
                [****]

                 

              	
                [****]

                 

              
	
                1,2-Dimyristoyl-sn-

                glycero-3-phosphocholine,

                Genzyme
                  product code #

                12-04-058,
                  DMPC

                 

              	
                greater
                  than [****]
                  kg
                  and less

                than
                  or equal to [****]
                  kg

                 

              	
                [****]

                 

              
	
                1,2-Dimyristoyl-sn-

                glycero-3-phosphocholine,

                Genzyme
                  product code #

                LP-04-058,
                  DMPC

                 

              	
                greater
                  than [****]
                  kg
                  and less

                than
                  or equal to [****] kg

                 

              	
                [****]

                 

              
	
                1,2-Dimyristoyl-sn-

                glycero-3-phosphocholine,

                Genzyme
                  product code #

                LP-04-058,
                  DMPC

                 

              	
                Greater
                  than [****]
                  kg

                 

              	
                [****]

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