Document:

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                          SUPPLEMENTAL INDENTURE NO. 2

                          Dated as of December 20, 2000

                                       to

                                    INDENTURE

                            Dated as of July 30, 1997

                                     between

                     Dura Pharmaceuticals, Inc., as Issuer,

                                       and

    Chase Manhattan Bank and Trust Company, National Association, as Trustee

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

                 3 1/2% Convertible Subordinated Notes due 2002

<PAGE>

     SUPPLEMENTAL INDENTURE NO. 2, dated as of December 20, 2000 (the
"Supplemental Indenture"), among Dura Pharmaceuticals, Inc., a Delaware
corporation (the "Company), and Chase Manhattan Bank and Trust Company, National
Association, as Trustee (the "Trustee"). Capitalized terms used herein but not
defined shall have the meanings assigned to them in the Indenture.

     WHEREAS, the Company has heretofore executed and delivered to the Trustee
an Indenture dated as of July 30, 1997, as supplemented by Supplemental
Indenture No. 1 between the Company and the Trustee, dated as of November 9,
2000 (the "Indenture"), providing for the issuance of its 3 1/2% Convertible
Subordinated Notes due 2002 (the "Notes"); and

     WHEREAS, Section 10.2 of the Indenture provides that, with the consent of
the Holders of not less than a majority in aggregate principal amount of the
Notes at the time outstanding, the Company, when authorized, and the Trustee,
may from time to time add any provision to or change in any manner or eliminate
any of the provisions of the Indenture; and

     WHEREAS, in accordance with Section 10.2 and as evidenced by Article VIII
of the Indenture, the Holders of at least a majority in aggregate principal
amount of outstanding Notes have delivered said consents to eliminate certain
provisions of the Indenture (the "Amendments"); and

     WHEREAS, pursuant to and as contemplated by Section 10.2 of the Indenture,
the parties hereto desire to execute and deliver this Supplemental Indenture for
the purpose of giving effect to the Amendments.

     NOW, THEREFORE, in consideration of the above premises, each party agrees,
for the benefit of the other and for the equal and ratable benefit of the
Holders of the Notes, as follows:

                                       I.

                                 THE AMENDMENTS

     Amendments.

     The Indenture is hereby amended as follows:

     1. Section 5.10 of the Indenture is hereby amended to delete the current
     language in its entirety and to replace it with the following:

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                                      -2-

     "Section 5.10 SEC Reports. The Company shall comply with Section 314(a) of
     the Trust Indenture Act to the extent applicable to it."

     2. Section 16.17 of the Indenture is hereby elimi- nated in its entirety
     and replaced with the words:

     "Section 16.17 [Intentionally omitted]."

                                      II.

                            MISCELLANEOUS PROVISIONS

     A. Indenture.

     Except as expressly amended by this Supplemental Indenture, the Indenture
is in all respects ratified and confirmed, and all the terms, conditions and
provisions thereof shall remain in full force and effect. All provisions of this
Supplemental Indenture shall be deemed to be incorporated in, and made a part
of, the Indenture and the Indenture, as supplemented by this Supplemental
Indenture, shall be read, taken and construed as one and the same instrument for
all purposes.

     B. Trustee Not Responsible for Recitals.

     The recitals contained herein shall be taken as the statements of the
Company, and the Trustee assumes no responsibility for their correctness, except
for the recital indicating the Trustee's approval of the form of this
Supplemental Indenture.

     C. Governing Law.

     THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE
AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAWS THEREOF.

     D. Duplicate Originals.

     This Supplemental Indenture may be executed in any number of counterparts,
each of which shall be an original, but such counterparts together constitute
but one and the same instrument.

<PAGE>

                                   SIGNATURES

     IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly signed, all as of the date first written above.

                                DURA PHARMACEUTICALS, INC.

                                By:  /s/ Mitchell R. Woodbury
                                     -------------------------------------------
                                         Name:  Mitchell R. Woodbury
                                         Title: Senior Vice President and
                                                  General Counsel

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                                      -2-

                                    Trustee:

                                    CHASE MANHATTAN BANK AND TRUST
                                    COMPANY, NATIONAL ASSOCIATION,
                                    not in its individual capacity but
                                    solely as Trustee

                                    By:  /s/ Rose Maravilla
                                         ---------------------------------------
                                             Name:  Rose Maravilla
                                             Title: Assistant Vice PresidentExhibit 10.1

***: Certain material has been omitted pursuant to request for confidential
     treatment. Such omitted material has been filed with the Securities and
     Exchange Commission.

                                License Agreement

This Agreement made and entered as of with effect from the 30th day of November
2000 (the "Effective Date"), by and between NDC, Netzler & Dahlgren Co AB
("NDC"), a corporation organized and existing under the laws of the Kingdom of
Sweden with its principal office in SE-429 80 Saro, Sweden and NDC Automation,
Inc. ("NDCA"), a corporation organized and existing under the laws of the state
of Delaware in the United States of America, with its principal office in 3101
Latrobe Drive, Charlotte, North Carolina 28211, USA.

WHEREAS, NDC, as licensor, and NDCA, as licensee, are parties to that certain
Restated Master License Agreement dated as of December 1, 1995 (the "MLA") which
conferred upon NDCA the exclusive right to incorporate NDC AGVS Control
Components and Equipment and NDC AGVS Control Know-How into Automated Guided
Vehicle Systems and to market and sell same to original equipment manufacturers
located within the Territory; and

WHEREAS, NDCA owed the aggregate amount of 5,714,473 SEK to NDC pursuant to
transactions which NDCA engaged in with NDC under the provisions of the MLA
prior to June 30, 2000; and

WHEREAS, by reason of NDCA's inability to pay said amount, NDC agreed, instead
of declaring a breach under the MLA, to restructure NDCA's obligation to pay
such amount pursuant to the terms of a promissory note dated June 30, 2000 which
NDCA made and issued to NDC (the "Note"); and

WHEREAS, by reason of NDCA's failure to satisfy certain payment obligations
imposed upon it pursuant to the MLA with respect to various AGVS Control
Components and Equipment purchased by NDCA from NDC under the MLA subsequent to
June 30, 2000 (the "Trade Indebtedness"), NDC, if it chose to do so, would be
entitled to give notice of NDCA's breach of the MLA, and to terminate the MLA if
NDCA would not cure such breach within 30 days after the giving of such notice;
and

WHEREAS, by reason of NDCA's failure to make payment of various installments due
under the Note when the same became due, NDC, if it chose to do so, would be
entitled to declare the entire principal amount of the Note, together with all
accrued interest thereunder, to be immediately due and payable; and

WHEREAS, NDCA desires to incorporate NDC AGVS Control Components and Equipment
and NDC AGVS Control Know-How into Automated Guided Vehicle Systems and market
and sell same to End Users, which it would be entitled to undertake pursuant to
the terms of the standard form of nonexclusive cooperation agreement that NDC
enters into with its various partners around the world, but which NDCA is not
presently authorized to undertake under the MLA; and

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WHEREAS, in order to assist NDCA to continue and restructure its business
operations, NDC is willing to (a) forebear from declaring a breach of the MLA;
(b) forebear from accelerating the maturity of the Note; (c) reduce the amount
owed by NDCA pursuant to the Note and restructure NDCA's payment obligations
thereunder; (d) waive payment of the substantial initial fee that it usually
charges when it enters into a nonexclusive cooperation agreement; (e) reduce the
amount of the Trade Indebtedness and restructure NDCA's payment obligations with
respect thereto; and (f) amend and restate the terms of its business
relationship with NDCA in the manner hereinbelow set forth,

NOW, THEREFORE, in consideration of these premises, the covenants herein
exchanged, and other good and valuable consideration, the parties agree as
follows:

1        Definitions

For the purposes of this Agreement, the following words and phrases shall have
the meanings indicated below:

         1.1  "AGVS" or "Automated Guided Vehicle System" shall mean a
              combination of material handling vehicles, on-board and stationary
              computers, and communication devices which work together to
              perform some or all of the following functions: dispatching,
              guiding, blocking, starting and stopping such vehicles, and
              communicating the status of each said function, the vehicle's
              load, and the vehicle's condition, so as to automatically move
              material on those vehicles throughout a designated area.

         1.2  "AGVS Control Components and Equipment" shall mean certain
              electronic control and guidance products (hardware and software)
              and equipment, as well as parts/components thereof, including
              replacement parts, used in automated guidance vehicles, carriers
              or systems, together with all modifications, improvements and
              derivations thereof, now or hereafter manufactured, assembled, or
              developed by or for NDC for the implementation, exploitation
              and/or development of NDC AGVS Control Know-How.

         1.3  "NDC AGVS Control Know-How" shall mean certain valuable,
              confidential and proprietary electronic guidance systems and
              processes and all know-how and technical information developed and
              owned by NDC which is related to the design, manufacture,
              installation and operation of Automated Guided Vehicle Systems.

         1.4  "Customized AGVS" shall mean an Automated Guidance Vehicle System
              comprised of NDC AGVS Control Components and Equipment and NDC
              AGVS Control Know-How which incorporates such engineering
              modifications therein as are necessary to comply with the unique
              requirements and specifications of the End User who is purchasing
              such system.

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         1.5  "End User" shall mean the organization or entity which acquires
              and utilizes a Customized AGVS or a vehicle equipped with a
              Lazerway(R) Teach-In System for its own use in connection with the
              operation of its business, and not for resale, leasing or
              licensing to others.

         1.6  "Lazerway Teach-In Control Components and Equipment" shall mean
              the NDC AGVS Control Components and Equipment which have been
              specifically designated by NDC for use in connection with Lazerway
              Teach-In System installations.

         1.7  "Lazerway Teach-In System" shall mean the combination of
              components manufactured and sold by NDC under the trade name
              "Lazerway Teach-In" consisting of certain Lazerway Teach-In
              Control Components and Equipment and Teach-In Software which is
              intended for installation in mass produced material handling
              vehicles, e.g., forklift trucks.

         1.8  "Teach-In Software" shall mean software specifically developed and
              manufactured by NDC for use in vehicles equipped with the Lazerway
              Teach-In System.

         1.9  "NDC Current or Future Systems" shall mean the NDC System Seven
              line of products and/or all future lines of NDC Automated Guidance
              Vehicle System products manufactured and distributed by NDC in
              addition to and/or in replacement of the NDC System Seven line of
              products, except that the current and any future Lazerway Teach-In
              System line of products including all Lazerway Teach-In Control
              Components and Equipment and all Teach-In Software, shall not be
              considered to be part of any NDC Current or Future Systems.

         1.10 "NDC Current or Future Systems Customized AGVS" shall mean an
              Automated Guidance Vehicle System comprised of NDC Current or
              Future Systems AGVS Control Components and Equipment and NDC AGVS
              Control Know-How, and which incorporates such engineering
              modifications therein as are necessary to comply with the unique
              requirements and specifications of the End User who is purchasing
              such system.

         1.11 "NDC System Seven" shall mean the lines of NDC Automated Guidance
              Vehicle Systems marketed by NDC as of and after the date of this
              Agreement under the trade name "NDC System Seven" including all
              AGVS Control Components and Equipment (other than Lazerway
              Teach-In Control Components and Equipment), all NDC AGVS Control
              Know-How and all other vehicle control and navigation software and
              hardware and stationary control software and hardware (other than
              Teach-In Software) incorporated therein, and all definition tools
              and equipment provided by NDC in connection therewith.

         1.12 "NDC Older Technologies" shall mean all NDC AGVS products,
              hardware and

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              software not included in, and which were distributed by NDC prior
              to, the NDC Current or Future Systems line of products.

         1.13 "Territory" shall mean the United States of America, Canada and
              Mexico.

         1.14 Contract Year" shall mean each twelve month period during the Term
              of this Agreement which commences on the Effective Date or an
              anniversary of the Effective Date, as the case may be.

2        Rights Granted to NDCA; Restrictions and Limitations Thereon.

         2.1  Manufacture and Sale of Customized AGVS. NDC hereby grants to NDCA
              during the Term of this Agreement a non-exclusive,
              non-transferable right and license, subject to the terms and
              conditions set forth herein:

              2.1.1   to design and manufacture within the Territory NDC Current
                      or Future Systems Customized AGVS and, in connection
                      therewith, to utilize all NDC AGVS Control Know-How and
                      incorporate therein all NDC Current or Future Systems AGVS
                      Control Components and Equipment;

              2.1.2   to sell, install and maintain NDC Current or Future
                      Systems Customized AGVS to End Users located anywhere in
                      the world; and

              2.1.3   to sell NDC Current or Future Systems Control Components
                      and Equipment and NDC AGVS Control Know-How to its NDCA's
                      sublicensees located within the Territory.

         2.2  Sublicense of Right to Manufacture and Sell Customized AGVS. NDC
              hereby grants to NDCA during the Term of this Agreement a
              non-exclusive, non-transferable right and license, subject to the
              terms and conditions set forth herein:

              2.2.1   to grant sublicenses to manufacture NDC Current or Future
                      Systems Customized AGVS within the Territory to any
                      business entity located within the Territory that is not a
                      manufacturer, distributor or reseller of mass produced
                      material handling vehicles, i.e., vehicles and other
                      devices used for the transportation of materials, e.g.,
                      forklift trucks; and

              2.2.2   to confer, as part of each such sublicense grant, the
                      sublicensee's right:

                      2.2.2.1   to employ in connection with the sublicensee's
                                manufacture of such NDC Current or Future
                                Systems Customized AGVS, all NDC AGVS Control
                                Know-How and to incorporate therein all NDC
                                Current or Future Systems AGVS Control
                                Components and Equipment; and

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                      2.2.2.2   to sell NDC Current or Future Systems Customized
                                AGVS to End Users located anywhere in the world.

         2.3  Upgrade of Lazerway Teach-In Equipped Vehicles. NDC hereby grants
              to NDCA during the Term of this Agreement a non-exclusive,
              non-transferable right and license, subject to the terms and
              conditions set forth herein:

              2.3.1   to upgrade, as and when requested to do so by an End User,
                      any Lazerway Teach-In Equipped Vehicle owned by such End
                      User by converting same to an NDC Current or Future
                      Systems Customized AGVS.

              2.3.2   to purchase any Lazerway Teach-In Equipped Vehicle from
                      the manufacturer thereof or one of its
                      dealers/distributors, to convert same to an NDC Current or
                      Future Systems Customized AGVS and resell same to an End
                      User.

         2.4  Maintenance, Upgrade and Support Services. NDC hereby grants to
              NDCA during the Term of this Agreement a non-exclusive,
              non-transferable right and license, subject to the terms and
              conditions set forth herein, to provide maintenance and support
              services for, sell spare parts for and upgrade all AGVS within the
              Territory equipped with NDC Current or Future Systems Customized
              AGVS or NDC Older Technologies.

         2.5  Conditions, Restrictions and Limitations Pertaining to the
              Licenses Granted Hereunder. The licenses granted to NDCA pursuant
              to this Article 2 are subject to the following conditions,
              restrictions and limitations:

              2.5.1   The rights granted to NDCA hereunder with respect to the
                      various technologies embodied in the NDC Control
                      Components and Equipment, the NDC AGVS Control Know-How,
                      the NDC Current or Future Systems and the Lazerway
                      Teach-In System are limited solely to the employment of
                      such technologies in connection with the activities
                      permitted by the provisions of Sections 2.1, 2.2, 2.3 and
                      2.4 hereof. Except for such permitted activities, NDCA
                      shall not have the right to (a) employ or make any other
                      use of any part or all of such technologies, or (b)
                      distribute, supply or otherwise transfer to any person or
                      entity, by sale, license or otherwise, any right, title,
                      interest or entitlement in all or any part of such
                      technologies.

              2.5.2   NDC shall refrain from selling AGVS Control Components and
                      Equipment directly to any NDCA sublicensee unless NDC
                      determines, in its sole discretion, that NDCA has failed
                      or refused to perform the obligations that it owes to its
                      sublicensee. In the event that NDC makes such a
                      determination, NDC, in order to preserve and protect its
                      reputation and good will, reserves the right to make
                      direct sales of AGVS Control Components and Equipment

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                      directly to the affected sublicensee. Such sales
                      activities by NDC shall not be deemed to be an assumption
                      by NDC of NDCA's rights and obligations as sublicensor
                      pursuant to NDCA's sublicense agreement with such
                      sublicensee.

              2.5.3   The following terms, conditions, restrictions and
                      limitations shall apply to every sublicense granted by
                      NDCA pursuant to any of the provisions of Section 2.2
                      hereof:

                      2.5.3.1   NDCA shall not have the right to grant to any
                                person or entity any right to utilize Lazerway
                                Teach-In Systems or to sell vehicles equipped
                                with Lazerway Teach-In Systems.

                      2.5.3.2   NDCA shall pay a fee to NDC equal to ten percent
                                (10%) of any consideration given by the
                                sublicensee to NDCA as, or in substitution for,
                                a sublicense fee. Such fee shall be due and
                                payable 30 days after the receipt by NDCA of any
                                payment upon which such fee shall be based.

                      2.5.3.3   NDCA shall not grant any sublicense pursuant to
                                any of the provisions of this Agreement which
                                shall be for a term which ends later than the
                                last day of the Term of this Agreement.

              2.5.4   All sales of NDC Older Technologies spare parts made by
                      NDC to NDCA shall be made in accordance with NDC's
                      published prices for such spare parts in effect at the
                      time of its acceptance of any purchase order therefor
                      issued by NDCA or any sublicensee of NDCA.

              2.5.5   NDC's obligation to honor any order placed by NDCA or any
                      sublicensee of NDCA for NDC Older Technologies spare parts
                      shall be subject to the availability of such parts at the
                      time of receipt of such order. NDC shall have no
                      obligation to supply (by manufacturing or otherwise) any
                      NDC Older Technologies spare part which shall be out of
                      inventory at the time of NDC's receipt of a purchase order
                      pertaining thereto.

3        Assistance

It is the desire and intention of each of the parties that, without assistance
from NDC, NDCA shall commence the design, development, manufacture and
installation of NDC Current or Future Systems Customized AGVS as soon as
possible after the parties execute this Agreement. However, during the Term of
this Agreement NDC shall render such assistance as NDCA shall request. All of
such assistance shall be rendered by NDC, and shall be paid for by NDCA,
pursuant to NDC's published prices for consulting services in effect at the time
of each such request. Payment for such services shall become due and payable 30
days after NDCA's receipt of NDC's invoices pertaining thereto.

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4        Purchases of NDC AGVS Control Components and Equipment.

All sales of NDC Current or Future Systems AGVS Control Components and Equipment
shall be made in accordance with NDC's published prices for such components and
equipment in effect at the time of its acceptance of any purchase order therefor
issued by NDCA. NDC shall have the right to adjust its published prices not more
than once every 12 months during the Term of this Agreement by giving not less
than 60 days' notice of such adjustment in writing to NDCA.

         4.1  Discounts   NDCA shall be entitled to receive an OEM Discount with
              respect to its purchases of NDC Current or Future Systems AGVS
              Control Components and Equipment determined, as follows:

              4.1.1   During the first two Contract Years of the Term of this
                      Agreement, the OEM Discount shall be *** off the published
                      unit price of each item of AGVS Control Components and
                      Equipment.

              4.1.2   During the last 60 days of each Contract Year (except the
                      first Contract year and the last Contract year of the
                      Term), NDC shall determine, based upon the volume of
                      NDCA's purchases of NDC Current or Future Systems AGVS
                      Control Components and Equipment and such other factors as
                      NDC shall deem to be relevant, the OEM Discount to be
                      applicable to all purchases of NDC Current or Future
                      Systems AGVS Control Components and Equipment which NDCA
                      shall make during the immediately succeeding Contract
                      Year. NDC shall confer with NDCA's management in
                      connection with its determination of such OEM Discount
                      however, such determination shall be made solely by NDC in
                      the sole exercise of its discretion.

5        General Conditions

         5.1  Terms of Delivery   NDC shall use its best efforts to fill all
              orders for NDC Current or Future Systems AGVS Control Components
              and Equipment and all NDC Current or Future Systems and NDC Older
              Technologies spare parts in the order in which NDC issues
              confirmations of the purchase orders pertaining thereto. All
              shipments of NDC Current or Future Systems AGVS Control Components
              and Equipment and all NDC Current or Future Systems and NDC Older
              Technologies spare parts shall be delivered ex works Saro
              (Incoterms 2000) or such other shipping point as NDC shall
              designate in writing. For manpower and engineering activities, the
              terms of delivery shall be in accordance with the applicable
              quotation and order confirmation.

         5.2  Terms of Payment   Payment for all shipments of NDC Current or
              Future Systems AGVS Control Components and Equipment and all NDC
              Current or Future Systems and NDC Older Technologies spare parts
              shall be due and payable 60 days after the date of invoice.
              Interest shall accrue and shall be payable on all invoiced amounts
              not paid within such 60 day period at the rate of 1.5% per 30 day
              period calculated from the 61st day after the invoice date until
              the date when the unpaid amount clears NDC's

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              bank account. NDC will promptly correct any inaccuracies in its
              issued invoices. Unless NDCA gives notice to NDC of an alleged
              error in any invoice within 20 days of the issuance thereof, such
              invoice shall be presumed to be correct. All NDC Current or Future
              Systems AGVS Control Components and Equipment and all NDC Current
              or Future Systems and NDC Older Technologies spare parts shall
              remain the exclusive property of NDC until full payment has been
              received therefor.

         5.3  Post-Termination Support of End Users   In the event that this
              Agreement shall be terminated pursuant to the provisions of
              Section 5.14 or 5.15 hereof, (a) NDC shall provide such support as
              may be necessary to any affected End User who shall have purchased
              or contracted for the purchase of any NDC Current or Future
              Systems Customized AGVS or Lazerway Teach-In System from; and (b)
              the parties agree to negotiate in good faith to consummate a
              binding agreement for the provision of warranty and spare part
              supply service and support to all then existing End Users of NDC
              Current or Future Systems Customized AGVS or Lazerway Teach-In
              Systems installed by NDCA, any NDCA Subsidiary or any sublicensee
              of NDCA or a NDCA Subsidiary.

         5.4  Incorporation of Terms By Reference   All provisions of the
              General Conditions for the Supply of Plant and Machinery for
              Export ECE 188 promulgated by the UNECE (March 1953) as amended
              and supplemented by the 1992 Addendum thereto which do not
              conflict with the provisions of this Agreement shall be
              incorporated into and made a part of each purchase of NDC Current
              or Future Systems AGVS Control Components and Equipment made by
              NDCA hereunder.

         5.5  Warranties - General   NDC warrants that each item of NDC Current
              or Future Systems AGVS Control Components and Equipment purchased
              by NDCA hereunder shall:

              5.5.1   be of good and merchantable quality and suitable for the
                      purpose specified by NDC in writing;

              5.5.2   conform in all respects to the specifications established
                      for such item by NDC;

              5.5.3   be free of any defect in workmanship or materials for a
                      period of 18 months after the date of shipment of such
                      item by NDC.

         5.6  Obligation to Repair or Replace   NDC shall:

              5.6.1   repair or replace, at NDC's option, free of charge to
                      NDCA, any item of NDC Current or Future Systems AGVS
                      Control Components found to be defective during the
                      above-stated warranty period which NDCA returns at its own
                      expense to NDC;

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<PAGE>

              5.6.2   bear all freight, packaging and insurance costs of sending
                      to NDCA a repaired or replaced item found to be defective
                      by NDC, provided, that, NDCA shall bear all costs with
                      respect to items that NDC in good faith shall determine
                      not to be covered within any of the warranty provisions
                      set forth above, in which event NDC shall provide NDCA
                      with an estimate of the cost to repair, and after
                      approval, return to NDCA the repaired item.

              5.6.3   not be obligated to repair or replace any item of NDC
                      Current or Future Systems AGVS Control Components and
                      Equipment that has been modified or installed in an
                      Automated Guidance Vehicle System which has been
                      configured with components which are not authorized by NDC
                      for use with its NDC Current or Future Systems AGVS
                      Control Components and Equipment.

         5.7  Warranties - Intellectual Property   Except as otherwise provided
              in Section 5.8 hereof, NDC warrants that no unit, item or
              component of NDC Current or Future Systems AGVS Control Components
              and Equipment or NDC AGVS Control Know-How acquired by NDCA
              hereunder shall infringe upon the intellectual property rights of
              any third party, including without limitation, claims of copyright
              infringement, trademark infringement, false designation of origin,
              disparagement, violation of patent or shop rights, piracy or
              plagiarism.

         5.8  Warranties - Software   Except to the extent that NDC may
              otherwise provide pursuant to its then current standard terms and
              conditions of sale, all software residing or incorporated in any
              NDC Current or Future Systems AGVS Control Components and
              Equipment shall be licensed or sold "as is" without any warranty
              as to performance, merchantability or fitness for a particular
              purpose; and the entire risk as to performance shall be assumed by
              the licensee or purchaser thereof.

         5.9  Limitation of Liability   NDC's liability for damages resulting
              from shipment of defective items, late shipment or failure to
              ship, shall be limited to the purchase price of defective, late or
              unavailable items. In no event shall NDC be liable for
              consequential, incidental or remote damages, tardiness or failure
              to ship. NDCA acknowledges that (a) the AGVS Control Components
              and Equipment, NDC AGVS Control Know-How and all software residing
              or incorporated therein have been designed to function with one
              another; (b) any combination or attempted combination of AGVS
              Control Components and Equipment, NDC AGVS Control Know-How and/or
              the software residing or incorporated therein with other control
              know-how, control components and equipment and/or software may
              result in incompatibilities which will hinder, prevent or degrade
              the performance thereof; and (c) any such combination or attempted
              combination shall void all warranties made by NDC hereunder.

         5.10 Spare Parts

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<PAGE>

              5.10.1  NDC will supply NDC Current or Future Systems spare parts
                      or compatible replacement parts for not less than the
                      number of years published from time to time in the NDC
                      Buyers Guide for the part or parts in question.

              5.10.2  NDC will not actively promote direct spare part sales to
                      End Users, and if contacted by an End User, NDC will refer
                      the End User to NDCA, provided, however, that:

                      5.10.2.1  if NDC shall be obligated by applicable law to
                                respond to an End User's request for delivery of
                                a spare part if such part is a standard NDC
                                product, listed in its published price-list
                                and/or it is a hardware product without any
                                specific application software, NDC shall comply
                                with such request.

                      5.10.2.2  if NDC determines, in its sole discretion, that
                                NDCA has failed or refused to perform the
                                obligations that it owes to its End User, NDC,
                                in order to preserve and protect its reputation
                                and good will, reserves the right to make direct
                                sales of spare parts directly to the affected
                                End User.

         5.11 Exchange of Information   During the Term of this Agreement, NDC
              shall furnish to NDCA all relevant information on any
              improvements, inventions or experience relating to the application
              of any NDC AGVS Control Know-How or NDC AGVS Control Components
              and Equipment to Automatic Guided Vehicle Systems whenever such
              information shall be, in NDC's judgment, relevant and useful to
              NDCA, provided that the disclosure of such information by NDC
              shall not violate any obligation of confidentiality which NDC may
              have to another party. During the term of this Agreement, NDCA
              shall furnish to NDC all information which may be relevant to the
              development or improvement of NDC AGVS Control Know-How" or NDC
              AGVS Control Components and Equipment.

         5.12 Preservation of Confidentiality   During the Term of this
              Agreement and for a five year period after its expiration:

              5.12.1  NDCA agrees to preserve in secrecy all of the detailed
                      information, including but not limited to NDC AGVS Control
                      Know-How supplied to NDCA by NDC, and any other
                      information, however acquired, relating to NDC's
                      manufacturing and assembly procedures, trade secrets,
                      practices, techniques and processes, and agrees to take
                      all reasonable steps which may be necessary or desirable
                      to assure NDC that the employees of NDCA and others who
                      may have access to NDCA's business affairs will maintain
                      the foregoing in secrecy. NDC hereby authorizes NDCA to
                      make disclosures of detailed information supplied to it by
                      NDC only to the extent necessary and appropriate to
                      satisfy the legitimate business needs of End Users who
                      purchase Customized NDC Current or Future Systems AGVS or
                      Lazerway

                                       10
<PAGE>

                      Teach-In Systems from NDCA, provided, however, that such
                      information shall continue to be considered confidential
                      and such disclosure shall in no way waive NDC's right to
                      prevent unauthorized disclosure thereof. The foregoing
                      obligation of NDCA shall not apply to any such detailed
                      information, trade secrets, practices, techniques or
                      processes which have been introduced into and have become
                      a part of the public domain, provided, that such
                      introduction shall not have occurred by reason of a
                      violation of the terms of this Agreement by NDCA, or any
                      officer, director or employee of NDCA. The actions of NDC
                      in supplying information pursuant to this Agreement or any
                      other agreement containing a similar preservation of
                      secrecy clause shall not be deemed to constitute an
                      introduction of such information into public domain.

              5.12.2  NDC agrees to preserve in secrecy information relating to
                      NDCA's manufacturing and assembly procedures, trade
                      secrets, practices, techniques and processes related to
                      the employment of NDC AGVS Control Know-How by NDCA, and
                      agrees to take all reasonable steps which may be necessary
                      or desirable to assure NDCA that the employees of NDC and
                      others who may have access to NDC's business affairs will
                      maintain the foregoing in secrecy.

         5.13 Term   This Agreement shall be valid and shall continue in full
              force and effect for an initial term of 10 years from the
              Effective Date hereof (the " Initial Term"), unless sooner
              terminated in accordance with the provisions of this Section or
              Sections 5.14 or 5.15. After the expiration of the Initial Term,
              this Agreement shall be renewed for additional successive one year
              terms (each, a "Renewal Term" and all considered together with the
              Initial Term, the "Term"), unless either party notifies the other
              in writing of its intent not to renew the Agreement or unless it
              is otherwise terminated. To be effective, notification of
              non-renewal must be sent to a party at least six months prior to
              the end of the then current Initial Term or Renewal Term.

         5.14 Termination   This Agreement may be terminated at any time prior
              to the expiration of its then current term by an agreement in
              writing between the parties; or

              5.14.1  Termination by NDC   NDC may terminate this Agreement
                      immediately or upon the giving of notice as hereinbelow
                      provided upon occurrence of any of the following specified
                      events:

                      5.14.1.1  Failure of NDCA to pay any amount due to NDC
                                within the time provided for such payment by the
                                applicable provision of this Agreement.

                      5.14.1.2  a breach of any of the provisions of this
                                Agreement, or failure to perform any of the
                                obligations imposed, under this Agreement upon
                                NDCA.

                                       11
<PAGE>

                      5.14.1.3  In the event that any warranty or representation
                                made by NDCA in or pursuant to this Agreement
                                proves false or misleading in any material
                                respect.

                      5.14.1.4  In the event a petition in bankruptcy is filed
                                by or against NDCA or an assignment of its
                                assets is made for the benefit of creditors, and
                                such petition is not dismissed, or such
                                assignment is not cancelled within 60 days
                                thereafter.

                      5.14.1.5  In the event that NDCA shall assign, or attempt
                                to assign its interest in this Agreement in
                                violation of Section 5.21 hereof, NDC shall be
                                entitled to terminate this Agreement immediately
                                upon giving notice of such termination to NDCA.

                      5.14.1.6  In the event that NDCA shall undergo a "change
                                of control," NDC shall be entitled to terminate
                                this Agreement immediately upon giving notice of
                                such termination to NDCA. For purposes of this
                                Agreement, the term "change of control" shall
                                mean a sale or transfer out of the ordinary
                                course of NDCA's business of all or
                                substantially all of its assets without having
                                received NDC's prior written consent thereto, or
                                the acquisition of ownership of or the right to
                                vote a block of voting securities of NDCA by a
                                single person, an entity or a group of persons
                                or entities acting in concert, in a single
                                transaction or related series of transactions,
                                which block of voting securities is equal to or
                                greater than the block of voting securities
                                owned or voted, directly or indirectly, by the
                                following persons, their successors or assigns:
                                Dr. Goran Netzler, Jan Jutander, Anders Dahlgren
                                and Arne Nilsson.

                      5.14.1.7  In the event that NDCA shall fail for any reason
                                to timely pay any amount which it shall owe to
                                NDC pursuant to the terms of Sections 5.25
                                and/or 5.26 hereof, NDC shall be entitled to
                                terminate this Agreement on the fifth day after
                                giving notice of such termination to NDCA,
                                unless the entire amount then due and owing
                                shall be paid within such five day period.

              5.14.2  Prior to termination of this Agreement by reason of an
                      event specified in Section 5.14.1.1 - 5.14.1.4 or
                      5.14.1.7, NDC shall send a written notice to NDCA,
                      specifying the event of default and indicating its
                      intention to terminate this Agreement. NDCA shall have 30
                      days (five days in the case of an event specified in
                      Section 5.14.1.7) from the date said notice is properly
                      given to NDCA within which to cure any such default. In
                      the event NDCA fails to cure any such default within said
                      thirty days period, this Agreement shall terminate upon
                      the expiration of said thirty days.

                                       12
<PAGE>

              5.14.3  NDC's exercise of any right of termination under this
                      Section does not constitute a waiver of other right and
                      remedies available to it.

         5.15 Termination by NDCA   NDCA shall have the right to terminate this
              Agreement upon the occurrence of any of the following events:

              (a)     In the event any warranty or representation made by NDC in
                      this Agreement proves false or misleading in any material
                      respect.

              (b)     NDC's breach of any of the provisions of, or failure to
                      perform any of the obligations imposed upon it under this
                      Agreement.

              5.15.1  Prior to termination of this Agreement by reason of an
                      event specified in this paragraph, NDCA shall send a
                      written notice to NDC, specifying the event of default and
                      indicating its intention to terminate this Agreement. NDC
                      shall have thirty days from the date said notice is
                      properly given to NDC, within which to cure any such
                      default. In the event NDC fails to cure any such defect
                      within said thirty days period, this Agreement shall
                      terminate upon the expiration of said thirty days.

         5.16 Notice to the Parties   Any notice required to be delivered under
              this Agreement shall be delivered by guaranteed overnight delivery
              service (e.g., Fed Ex), facsimile transmission (with confirmed
              answer-back) or e-mail addressed to the parties at their
              respective addresses first above-written, or to such other address
              as either party may designate by notice given to the other in
              accordance with the provisions of this Section. Such notice will
              be effective on the date upon which it is sent if it is delivered
              by facsimile or by e-mail, and on the date of receipt, if
              delivered by overnight delivery service.

         5.17 Arbitration   Any dispute, controversy, or claim arising out of or
              relating to this Co-operation Agreement, or breach thereof, either
              directly or indirectly, which cannot be settled amicably between
              the parties, shall be finally decided by arbitration. The
              arbitration shall be conducted in accordance with the rules of
              conciliation and arbitration of the International Chamber of
              Commerce. The arbitration hearing shall take place in London. The
              costs of the arbitration shall be borne equally by the parties,
              provided that each party shall pay its own counsel and expert
              witness fees.

         5.18 Modifications, Improvements, Etc. to Intellectual Property   All
              modifications and improvements to, and all derivations of any NDC
              AGVS Control Components and Equipment and the NDC AGVS Control
              Know-How shall remain or become the sole and exclusive property of
              NDC, whether made or discovered by NDC or NDCA. NDCA shall have
              the right to utilize all such modifications, improvements and
              derivations within the scope of and during the Term of this
              Agreement.

                                       13
<PAGE>

         5.19 Force Majeure   All transactions between the parties are subject
              to fire, strikes, lockouts, accidents, inability or delays in
              transportation, any national or local law affecting importation of
              any item. Acts of God, or causes above and beyond the reasonable
              control of either party shall absolve the performing party of any
              liability to the other or any of their respective customers.

         5.20 Agency   This Agreement shall not be construed to give rise to any
              agency relationship between NDC and NDCA.

         5.21 Assignment   This Agreement shall be binding upon the parties
              hereto and their respective successors and assigns; however,
              neither party may assign this Agreement without the prior express
              written consent of the other party and any such purported
              assignment in violation of this Section shall be null and void.

         5.22 Severability   If any provision of this Agreement is held illegal,
              invalid, or unenforceable, that provision shall be severed from
              the whole and will not affect the legality or enforceability of
              the remainder of the Agreement.

         5.23 Governing Law   This Agreement shall be governed by and in
              accordance with the laws of the State of North Carolina, United
              States of America pertaining to the enforcement of contracts
              executed within and to be performed in said jurisdiction.

         5.24 Entire Agreement; Supersession of Prior Agreements   This
              Agreement contains the entire and complete understanding of the
              parties and is intended to be the final statement of all terms and
              conditions herein contained. This Agreement replaces all prior
              agreements, courses of dealing, statements and representations
              made by or between the parties including, but not limited to the
              Restated Master License Agreement between the parties dated as of
              December 1, 1995. Any provision, modification, or amendment to
              this Agreement must specify with certain particularity each
              addition, change, or modification and be a duly authorized
              representative of each party hereto.

         5.25 Reduction and Restructuring of Note   NDC hereby agrees to reduce
              NDCA's aggregate indebtedness under the Note from 5,714,473 SEK to
              4,523,957 SEK (the "Restructured Principal"). Such Restructured
              Principal, together with interest thereon computed on the unpaid
              balance thereof at the rate of 4.5% per annum between the date of
              this Agreement and March 31, 2001, and thereafter at the rate of
              9.0% per annum, shall be paid by NDCA in 16 monthly installments
              of principal and interest, as set forth in Schedule A annexed
              hereto. In the event that NDCA shall fail for any reason to pay
              any installment of Restructured Principal and/or interest when the
              same shall become due, (a) the entire unpaid balance of
              Restructured Principal, together with all accrued but unpaid
              interest thereon, shall become immediately due and payable five
              days after NDC gives notice of its election to accelerate the
              maturity of

                                       14
<PAGE>

              such indebtedness; and (b) NDCA shall be obligated to pay the
              reasonable counsel fees incurred by NDC in connection with any
              action or proceeding that NDC shall commence to collect or
              otherwise enforce its rights with respect to such indebtedness.

         5.26 Repurchase of Inventory and Extension of Time for Payment of Trade
              Indebtedness   NDC hereby agrees to repurchase up to 500,000 SEK
              of NDCA's inventory of NDC AGVS Control Components and Equipment.
              The actual items of inventory which shall be repurchased by NDC
              shall be determined by mutual negotiation between the parties.
              NDCA owes NDC the aggregate amount of 1,176,739 SEK (the "Trade
              Debt") with respect to purchases of NDC AGVS Control Components
              and Equipment which it made subsequent to June 30, 2000, of which
              390,283 SEK is past due as of November 6, 2000. NDC hereby agrees
              to reduce the total amount of the Trade Debt by the aggregate
              amount of the repurchased inventory, and to restructure NDCA's
              obligation to pay such reduced Trade Debt, as follows: the entire
              amount of the Trade Debt, as reduced by the amount of the
              repurchased inventory, shall be due and payable without interest
              on April 1, 2001. In the event that NDCA fails to pay such amount
              in full on or before said date, interest shall accrue on, and
              shall be due and payable with respect to, the unpaid balance
              thereof at the rate of 18% per annum from April 1, 2001 through
              the date of full payment of such unpaid balance and accrued
              interest.

         5.27 Extension of Term of Letter of Credit   NDCA has advised NDC that
              Summit Business Capital Corp. ("Summit") has given notice to NDCA
              that the $450,000 working capital line of credit loan granted by
              Summit's predecessor in interest (the "Loan") will not be renewed,
              and that the Loan shall terminate on January 31, 2001. Said Loan
              is collateralized by a $450,000 letter of credit issued on behalf
              of NDC by Merita-Nordenbanken Group (the "Bank") for the benefit
              of Summit (the "Letter of Credit"). NDC has been advised that NDCA
              is attempting to secure a three month extension of the Loan
              through April 30, 2001. In the event that Summit is willing to
              grant such extension if the Letter of Credit is extended through
              said date, NDC shall cause the Bank to amend the Letter of Credit
              to provide for such extension.

          [the balance of this page has been left blank intentionally]

                                       15
<PAGE>

         5.28 Limitation on Rights Granted to NDCA Hereunder The only rights
              which NDCA may exercise hereunder are those that have been
              expressly granted to it pursuant to the terms and conditions of
              this Agreement. All other rights have been expressly reserved by,
              and may only be exercised by, NDC.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement by the
signatures of their respective duly authorized officers or representatives as of
and with effect from, the Effective Date.

                                  NDC, Netzler & Dahlgren Co AB

                                  By:               /s/ Jan Jutander
                                     -------------------------------------------

                                  NDC Automation, Inc.

                                  By:               /s/ Claude Imbleau
                                     -------------------------------------------

<PAGE>
                                   Schedule A

                    Payment of Restructured Note Indebtedness
<TABLE>
<CAPTION>
                     Amount of Restructured     Amount of Interest        Total Amount
 Installment           Principal Included     Included in Installment    of Installment
Payment Date       In Installment (in SEK)            (in SEK)              (in SEK)
------------       ------------------------   -----------------------  -----------------
<S>                        <C>                       <C>              <C>
April 1, 2001              952,412                   163,785               1,116,197
April 30, 2001             238,103                    26,787                 264,890
May 31, 2001               238,103                    25,001                 263,104
June 30, 2001              238,103                    23,989                 262,092
July 31, 2001              238,103                    22,144                 260,247
August 31, 2001            238,103                    19,644                 257,747
September 30, 2001         238,103                    17,858                 255,961
October 31, 2001           238,103                    16,072                 254,175
November 30, 2001          238,103                    14,286                 252,389
December 31, 2001          238,103                    12,500                 250,603
January 31, 2002           238,103                    10,715                 248,818
February 28, 2002          238,103                     8,334                 246,437
March 31, 2002             238,103                     7,143                 245,246
April 30, 2002             238,103                     5,357                 243,460
May 31, 2002               238,103                     3,572                 241,675
June 30, 2002              238,103                     1,786                 239,889
TOTALS                   4,523,957                   378,973               4,902,930
</TABLE>

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