Document:

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                          Aspect Medical Systems, Inc.
has requested that the marked portions of this agreement be granted confidential
  treatment pursuant to Rule 406 under the Securities Act of 1933, as amended.

                                                                    Exhibit 10.7

                          ASPECT MEDICAL SYSTEMS, INC.

                     OEM DEVELOPMENT AND PURCHASE AGREEMENT

         Agreement dated this Sixth day of August, 1999 , by and between Aspect
Medical Systems, Inc, a Delaware corporation with its principal offices located
at Two Vision Drive, Natick, Massachusetts ("Aspect") and Hewlett-Packard GmbH
("HP"), a German corporation with its principal offices located in Germany at
71034 Boblingen, Herrenberger Str. 110-140, for the purchase and/or license by
HP of products under the terms and conditions contained in this Agreement.

1.   BACKGROUND.

          (a)  Aspect is a developer, manufacturer and distributor of medical
               devices, equipment, accessories and related hardware, software
               and related products and accessories.

          (b)  HP is a manufacturer of medical equipment, in particular of
               multiparameter patient monitors.

          (c)  Aspect and HP intend to make available to HP customers a solution
               to integrate Aspect's BIS technology with HP's patient monitors.
               In a first phase of the cooperation Aspect and HP will develop
               appropriate components in a joint project (the "BIS Project").
               In the second phase of the cooperation, HP intends to purchase
               and/or license specified products for integration with its own
               systems and products. Aspect agrees to sell and/or license to HP
               the products described below, subject to the terms and conditions
               contained in this Agreement.

          (d)  It is the intention of both Parties to negotiate a separate,
               independent distribution agreement (the "Distribution Agreement")
               under which HP will also sell the Aspect 2000 BIS Monitor and
               Aspect BIS Sensors in certain geographies.

2.   DEFINITIONS.

          "Aspect's Bispectral Index" or "BIS" is Aspect's proprietary processed
          EEG parameter that measures the hypnotic effects of anesthetic and
          sedative agents on the brain during surgery.

          "HP Patient Monitors" means a family of multi-parameter modular
          patient monitoring systems manufactured by or for HP. When the HP BIS
          System is complete, HP Patient Monitors will display BIS data
          (waveforms, numerics, status info), and provide setup and operation
          information (user interface), alarming, and network connectivity.

          "HP BIS System" is the sum of all components involved in integrating
          the BIS with HP Patient Monitors.

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          "HP BIS Module" is a standard size parameter module for HP Patient
          Monitors to convert the data as delivered by the HP BIS Engine from
          the BIS Protocol to the HP Patient Monitor's internal format.

          "Module Cable" is a cable used to connect the HP BIS Engine to the HP
          BIS Module.

          "DSC Cable" is a cable used to connect the Digital Signal Converter to
          the HP BIS Engine.

          "HP BIS Engine" is the processing unit for deriving the BIS data from
          the raw EEG signal and consists of Aspect's "BIS Engine" board
          modified for HP and built into a housing with appropriate connectors
          to connect to the DSC Cable and the Module Cable.

          "Digital Signal Converter" (or "DSC") is used to amplify the analog
          EEG signals as acquired by the BIS sensors and convert it from analog
          to digital signals.

          "Aspect BIS Module Kit" means the bundle of all components of the HP
          BIS System that are developed and manufactured by Aspect and
          licensed/sold to HP under this Agreement: DSC, DSC Cable, HP BIS
          Engine, and Module Cable.

          "Aspect BIS Sensor" means a single use disposable sensor manufactured
          by Aspect for use with the Aspect A2000 BIS monitor or with the Aspect
          BIS Module Kit and that is required to generate Aspect's Bispectral
          Index.

          "Sensor Startup Kit" is a set of Aspect BIS Sensors that may be part
          of each HP BIS System sale by HP in selected geographies outside North
          America.

          "A2000" means Aspect's stand-alone BIS monitor for use with the Aspect
          BIS Sensor and that generates Aspect's Bispectral Index.

          "Aspect Products" means Aspect BIS Module Kits and any other product
          that can be ordered by HP as listed in Exhibit A (Aspect Products and
          Purchase Prices).

          "Software" means Aspect software programs in binary code form which
          are designed for use with the Aspect BIS Module Kit.

          "BIS Protocol" is Aspect's proprietary communication protocol provided
          for purposes of communication between the HP BIS Engine, the HP BIS
          Module and HP Patient Monitors

          "Documentation" means the BIS Engine Serial Interface Specification.

          "Territory" shall mean all countries in which HP is permitted under
          this Agreement to distribute Aspect Products.

          "Party" or "Parties" shall mean Aspect and HP each individually or
          jointly.

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

3.   BIS MODULE DEVELOPMENT PROJECT.

     3.1. PROJECT SCOPE

          (a)  Aspect and HP will be performing activities to develop a HP BIS
               System. Aspect will modify Aspect's standard BIS Engine product
               described in Exhibit B to create a HP BIS Engine. HP will develop
               a HP BIS Module to interface with Aspect's modified BIS Engine.

          (b)  The following specifications/documents will be created and agreed
               upon by both parties prior to completion of Phase 1 of the Module
               Development Project:

               -    Functional Technical Specification (FTS): This is a
                    specification that defines the interface between the HP BIS
                    Engine and the HP BIS Module. This document is an HP
                    specification that is derived principally from
                    specifications and materials from Aspect.

               -    System Hazard Analysis: To be performed in Phase 1 of the
                    project.

               -    External Specification: Specification describing the HP BIS
                    Module and the Aspect BIS Module Kit as a system from the
                    customer's viewpoint.

               -    Project Plan: The project plan will include a detailed
                    project schedule, detailed project description, and other
                    information not included in the FTS.

     3.2. PROJECT TIMING

The overall project duration is expected to be approximately [**]. The product
introduction is planned for [**]. The expected major project milestones are
described below:

[**]              [**]

     3.3. PROJECT PHASE DESCRIPTIONS

The following phases of the project closely correlate with the standard internal
project phases of the HP development process.

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

PHASE 1: PROJECT DEFINITION

Phase 1 defines the project at a high level.

The principal technical issues to resolve are the [**] requirements and the [**]
requirements for the [**].

At the end of Phase 1 the following documents are created: External
Specification (preliminary), Functional Technical Specification (preliminary),
an initial Hazard Analysis, and a detailed Project Schedule., In addition, HP
shall create internal Functional Plans, including a development plan,
verification and validation plan, manufacturing plan, marketing plan,and
regulatory plan.

PHASE 2A: SPECIFICATION

In Phase 2A the detailed design specifications are created: External
Specification (Final), Technical Specification (Final), Hazard Analysis (Final)
and definition of Aspect's Qualification Test Procedure (verification and
validation plan for all items identified under the Functional Technical
Specification).

PHASE 2B: DESIGN (IMPLEMENTATION)

The actual electrical, circuit schematics, and mechanical design and
implementation is performed in Phase 2B. The output of Phase 2B is a functional
prototype. This functional prototype is intended to be a faithful representation
of the product, including actual molded materials, electronics and software.
During this phase, the Outgoing Inspection Procedure from Aspect is also
defined.

PHASE 3: VERIFICATION

Design verification testing of software, electronics and mechanical components
is performed in Phase 3. Additionally EMI testing of the system is performed in
this phase of the project. Aspect will perform an [**] of the [**] as a [**]
with the BIS Module.

Clinical field trials are started in Phase 3. It is anticipated that field
trials of the BIS Module System will be conducted in [**] hospitals in Europe
and [**] hospitals in the US. The completion of field trials occurs by the end
of Phase 4.

During this phase, results of the Qualification Tests and Outgoing Inspection
will also be reviewed for all prototypes.

PHASE 4: VALIDATION

The following tasks are accomplished during Phase 4: Software Validation: Formal
validation testing of the BIS Module System.

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

Manufacturing Pilot Build: It is expected that [**] systems will be built, of
which [**] units will be required at the beginning of Phase 3 for clinical field
trials. The systems will be used for clinical trials, engineering test, and for
sales demos. Final Test Procedure: Used to 100% test the Aspect BIS Module Kit
and HP BIS Module as a final test in manufacturing.

     3.4 PROJECT MANAGEMENT.

          (a)  Each party shall appoint a "Project Manager" who oversees and
               manages the joint project on a day-to-day basis.

          (b)  The Project Managers shall meet regularly based on the project
               needs to assess the project status and discuss and resolve any
               issues or problems. These meetings may be held face-to-face or as
               telephone or video conferences.

          (c)  Both Parties' project teams shall conduct project meetings from
               time to time as deemed useful.

          (d)  Each Party shall bear its own communication and travel costs.

          (e)  All communication in conjunction with this Agreement shall be
               directed to the appropriate person and address as listed in
               Exhibit C (Contact Persons/Addresses).

     3.5. JOINT RESPONSIBILITIES.

          (a)  Both Parties will actively work together in performing a joint
               Hazard Analysis for the HP BIS System at the beginning of the BIS
               Project.

          (b)  Both Parties will generate a joint External Specification of the
               HP BIS System.

          (c)  The parties will jointly develop and agree on a Verification and
               Validation Plan for testing the performance and safety of the
               entire BIS System prior to its release to shipment.

          (d)  The verification and validation of the HP BIS System will be
               performed under HP's overall responsibility at HP's Boeblingen
               premises. Aspect agrees to support this effort as defined in the
               Verification and Validation Plan and as may be required in case
               of problems. Verification and validation of Aspect's BIS Module
               Kit will be performed by Aspect in Aspect's Natick facility.
               After successful validation by HP of the HP BIS System, Aspect
               will also validate the HP BIS System output and confirm in a
               written certificate that the BIS value as displayed on the HP
               Patient Monitor is equivalent to Aspect's BIS implementation.

          (e)  Both parties will inform each other of any planned change in its
               products that may affect compatibility of the HP BIS System
               components or the available regulatory approvals. The Change
               Notification Agreement Form (attached as Exhibit D) will be used
               for this purpose.

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          (f)  Both parties will provide each other reasonable engineering
               consultation free of charge.

          (g)  Aspect and HP will provide each other free of charge with certain
               number of prototypes and product samples for development,
               verification and validation, and getting regulatory approvals.

     3.6. HP RESPONSIBILITIES.

          (a)  HP shall develop the HP BIS Module according to the mutually
               agreed Functional Technical Specification and External
               Specification at HP's own cost.

          (b)  HP will take responsibility for the development, design and
               performance of the HP BIS Module and for the combination of the
               Aspect components (BIS Module Kit) with the HP components (HP BIS
               Module, HP Patient Monitor) of the HP BIS System.

     3.7. ASPECT RESPONSIBILITIES.

          (a)  Aspect shall develop the HP BIS Engine, the DSC Cable and the
               Module Cable according to the mutually agreed specifications at
               Aspect's own cost.

          (b)  Aspect will take responsibility for the development, design and
               performance of the Aspect BIS Module Kit.

          (c)  Aspect shall make available the BIS Protocol specification to HP
               for implementation into the HP BIS Module or otherwise into HP
               Patient Monitors.

          (d)  Aspect will undertake reasonable efforts to maintain backward
               compatibility for future versions of the BIS Protocol, however no
               guarantee is given.

          (e)  Aspect will inform HP of future changes to the BIS Protocol as
               early as possible and make available such changed BIS Protocol
               specification to HP. The Change Notification Agreement Form
               (attached as Exhibit D) will be used for this purpose.
               Notwithstanding anything to the contrary in the Change
               Notification Agreement Form, HP shall not withhold its approval
               of any future changes to the BIS Protocol as provided in Section
               3.7 (d).

4. PURCHASE AND SALE OBLIGATIONS; LICENSES.

          (a)  General. Subject to the terms and conditions of this Agreement,
               Aspect agrees to sell to HP the Aspect Products listed on Exhibit
               A (Aspect Products and Purchase Prices). For these products,
               Aspect grants to HP or HP's subdistributors a non-exclusive,
               worldwide distribution right for the term of this Agreement. HP
               represents and warrants that the components of the Aspect BIS
               Module Kits purchased from Aspect under this Agreement shall be
               used as components in, incorporated into, or integrated with,
               systems and products which HP sells or leases to third-party
               users in the regular course of business. HP further certifies
               that the components of the Aspect BIS Module Kits will only be
               resold, leased, rented, licensed or otherwise transferred to
               third parties for use as a part of an HP BIS System or as
               replacement parts used in HP BIS Systems.

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          (b)  BIS Sensors. Apart from section 4.a., Aspect hereby grants HP the
               right to distribute Aspect BIS Sensors solely to HP's customers
               outside North America and solely for use with HP BIS Systems.

          (c)  Sensor Startup Kit. Aspect hereby grants HP the right to sell the
               Sensor Startup Kit for use with the HP BIS System in geographies
               outside North America.

          (d)  Software License. Aspect hereby grants to HP a non-exclusive and
               non-transferable worldwide license, without the right to
               sublicense (except to purchasers of HP BIS Systems and to HP's
               subdistributors), during the term of the Agreement to use the
               Software and related Documentation provided by Aspect solely in
               connection with operation of the components of Aspect BIS Module
               Kit in the HP BIS System. Thereafter, Aspect grants to HP a right
               to use the Software and related Documentation used in conjunction
               with the HP BIS Systems being sold by HP on the date of
               termination with respect to service and support of installed HP
               BIS Systems for a period of 10 years, after termination of the
               Agreement. All rights granted to HP customers to use the HP BIS
               System shall be irrevocable as long as such customers are in
               compliance with the terms of use for such HP BIS Systems and does
               not cure such non-compliant use within 90 days of being notified.
               HP shall not disclose, furnish, transfer, distribute or otherwise
               make available the Software, the Documentation or any portion
               thereof in any form to any third party (other than to purchasers
               of HP BIS Systems and to HP's subdistributors) and shall not
               duplicate the Software, the Documentation or any part thereof
               (other than for HP's internal use). Title to and ownership of and
               all proprietary rights in or related to the Software, the
               Documentation and all partial or complete copies thereof shall at
               all times remain with Aspect or its licensor(s). This Agreement
               shall not be construed as a sale of any rights in the Software,
               the Documentation, any copies thereof or any part thereof. All
               references in this Agreement to sale, resale or purchase of the
               BIS Module Kits or the components thereof, or references or like
               effect, shall, with respect to the Software and the Documentation
               mean licenses or sublicenses of the Software and the
               Documentation pursuant to this Section 4. HP shall not
               disassemble, decompile or otherwise reverse engineer the Software
               or any part thereof, except if Aspect is required under
               applicable law to permit HP to reverse engineer any Software. In
               such event, HP may reverse engineer the Software but only to the
               extent Aspect is required to permit such reverse engineering. HP
               shall retain and shall not alter or obscure any notices, markings
               or other insignia which are affixed to the Software, the
               Documentation or any part thereof at the time it receives such
               Software or such Documentation.

          (e)  BIS Protocol License. Aspect hereby grants to HP a non-exclusive,
               worldwide, irrevocable, royalty-free license to implement
               Aspect's proprietary BIS Protocol and sell it to HP's end
               customers as part of its products for use solely with the Aspect
               BIS Module Kit.

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

5. ROYALTIES.

          (a)  For each BIS Module Kit that HP is purchasing from Aspect HP
               shall pay a purchase price for the BIS Module Kit and a royalty
               fee as specified in Exhibit A (Aspect Products and Purchase
               Prices).

          (b)  Within 30 days after the Effective Date, HP shall pay Aspect an
               amount of [**] US$ as prepaid royalties, which will be credited
               against the actual royalty component of the purchase price that
               is due for the sale of the first [**] Aspect BIS Module Kits. It
               is understood that [**] of this amount to [**] in connection with
               the [**].

          (c)  In the event that the Agreement is terminated by HP because
               Aspect is unable to deliver a HP BIS Engine before October
               31st,[**](in accordance with Section 23.2, paragraph b), or in
               the event Aspect fails to deliver the first [**] Aspect BIS
               Module Kits for whatever reason, excluding breach by HP or
               failure to order then Aspect shall refund HP according to the
               following rules:

               (i)  Aspect shall refund to HP that part of the prepayment that
                    is not yet consumed by unit royalties, however not more than
                    [**] US$.

               (ii) Aspect shall [**] of the [**] that is [**] for the [**]. For
                    purposes of [**] it is [**].

          (d)  Aspect agrees to [**] a [**] in accordance with the terms
               outlined in [**] in accordance with Section 5 (c) in the event
               that [**] as determined on a [**] and [**] following the [**] of
               [**]. HP agrees to [**] for [**] in connection with [**]. At such
               time as Aspect completes an initial public offering of its common
               stock, the requirement to [**] will terminate.

6. SCOPE OF DELIVERY

          (a)  Purchase Orders. Purchase orders (via Fax, e-mail, other
               electronic transmission or paper) for Aspect Products to be
               purchased under this Agreement (the "Orders") must be received by
               Aspect during the term of this Agreement and must specify a
               delivery date in accordance with the lead-time schedule outlined
               below under Section 6, paragraph e) All HP Purchase Orders will
               make reference to the appropriate engineering drawing or
               manufacturing reference numbers.

          (b)  Order Acknowledgements. HP purchase orders will be acknowledged
               by Aspect within 5 days after receipt of the order, provided that
               the order is technically correct and that the requested delivery
               time is within the agreed lead time and that the latest forecast
               provided by HP is not exceeded by more than [**] and the quantity
               ordered does not exceed by more than [**] the quantity ordered in
               the preceding month. If the requested delivery time is lower than
               the agreed lead time, or if HP's latest forecast is exceeded by
               more than [**], Aspect shall use reasonable efforts to complete
               the order requirements and to acknowledge the order within 10
               days of its receipt. Order acknowledgements shall not be
               unreasonably withheld.

          (c)  Forecasts. HP shall furnish to Aspect a non-binding monthly
               forecast during the term of this Agreement with the number and
               type of Aspect Products for which HP expects to submit orders for
               the following twelve months. Existing open purchase orders are
               not usually reflected in these forecast numbers.

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

          (d)  Cancellation Charges. In the event of the cancellation of any
               Order by HP, HP shall be liable for the payment of cancellation
               charges based on the number of days prior to scheduled delivery
               that written notice of cancellation is received by Aspect, as
               outlined below:
<TABLE>
<CAPTION>
<S>                                                          <C>
    > 10 weeks prior to acknowledged delivery                [**]
    6 - 10 weeks prior to acknowledged delivery              [**] of order value
    4 - 6 weeks prior to acknowledged delivery               [**] of order value
    2 - 4 weeks prior to acknowledged delivery               [**] of order value
    < 2 weeks prior to acknowledged delivery                 [**] of order value
</TABLE>

          (e)  Lead Times. Lead times for the Aspect BIS Module Kit are expected
               to be 12 weeks.

7. PRICES.

          (a)  Purchase Prices. The prices of Aspect Products purchased by HP
               hereunder (the "Purchase Prices") which are ordered during the
               term of the Agreement shall be as set forth in Exhibit A (Aspect
               Products and Purchase Prices).

          (b)  Purchase Price Changes. In consideration of the market situation
               and after consultation with HP, the Purchase Prices set forth in
               Exhibit A (Aspect Products and Purchase Prices) will be reviewed
               12 months after first delivery of production units and annually
               thereafter. Any price increase will become effective only after
               mutual agreement between both Parties, subject to the following:

               (i)  In the event the materials cost for the Aspect BIS Module
                    Kit increases by more than [**]. Aspect shall have the right
                    no more than once per year during the term of this Agreement
                    to increase the Purchase Price of the Aspect BIS Module Kit
                    by an equivalent amount by giving HP written notice of such
                    increase not less than [**] days prior to the date upon
                    which the increased Purchase Price is to become effective.
                    No Purchase Price increase shall apply to Orders for Aspect
                    Products accepted by Aspect prior to or during such [**] -
                    day period which are to be delivered within [**] days of the
                    date of such notice.

          (c)  Aspect may reduce the Purchase Price of any Aspect Product at any
               time. Such reduction shall be applicable to all Aspect Products
               not shipped at the time of the reduction.

          (d)  [**] the Purchases Prices [**] the [**] for [**] and based on
               similar terms and conditions [**] that has entered into a [**]
               the date of this agreement.

          (e)  Taxes. All prices for Aspect Products are exclusive of all
               federal, state and local taxes, levies and assessments, and HP
               shall be responsible for the payment of all such taxes, levies
               and/or assessments imposed on Aspect Products purchased and/or
               licensed by HP hereunder, excluding taxes based on Aspect's net
               income

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              from the transaction. HP shall be responsible for providing in a
              timely manner all documentation, in the nature of exemption
              certificates or otherwise, necessary to allow Aspect to refrain
              from collections, such as sales tax, which it would otherwise be
              obligated to make

8. TERMS OF PAYMENT.

          (a)  Invoices. HP shall pay to Aspect the Purchase Price of all Aspect
               Products shipped hereunder within 30 days after the receipt of
               Aspect's invoice. Nothing herein shall affect Aspect's right to
               withhold shipment or otherwise exercise its rights under Section
               24 (Termination) hereof in the event of HP's failure to make
               payment when due for Aspect Products delivered to HP. Aspect's
               invoices to HP for Aspect Products purchased under this Agreement
               shall be addressed to:

                  Hewlett-Packard GmbH
                  Department ASC-AP
                  Postfach 1430
                  D-71004 Boeblingen
                  Germany

                  Late Payment Charge. Subject to applicable law, service and/or
                  interest charges not exceeding the lesser of 1-1/2% per month
                  or the highest amount permitted by law may, at the election of
                  Aspect, be assessed on amounts past due more than 30 days.

9. SHIPMENT AND DELIVERY.

          (a)  Delivery Location. Each shipment must indicate the exact address
               of the recipient on the outside of the packaging as follows:

               Hewlett-Packard GmbH
               HSG-E Healthcare Solution Group Europe
               c/o Js. Mueller Spedition GmbH
               Eugen Zeyer Str. 1
               D-75382 Althengstett
               Germany

          (b)  All shipments hereunder shall be freight collect, F.C.A. point of
               origin (Incoterms 1990). All Aspect Products shall be deemed
               delivered and subject to HP's dominion and control when placed in
               the possession of the carrier, packed and ready for shipment to
               HP.. Aspect shall cooperate with HP in the documentation and
               proof of loss claims promptly presented by HP to the appropriate
               carrier and/or insurer.

          (c)  Delivery and Packaging Instructions Delivery and Packaging
               requirements will need to conform to the standards outlined in
               the HP Delivery and Packaging Standard (attached as Exhibit E)

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

          (d)  Delivery Date and Date of Dispatch. The requested delivery date
               will be specified on the HP Purchase Order. Aspect will utilize
               reasonable efforts to ensure that the order is delivered in
               accordance with Aspect's order acknowledgement and that the the
               date of dispatch is 10 days prior to the delivery date.

10. ACCEPTANCE.

Any Aspect Product shipped hereunder may be subjected to inspection and
performance testing by HP, in accordance with applicable product specifications
in effect at the time of delivery of such Aspect Products to HP. HP shall
provide written notice to Aspect of the rejection of any such Aspect Product
within [**] days of the date of receipt of any Aspect Product; if more than
[**]% of Aspect Products received in any single shipment do not pass HP's
inspection or performance testing HP may reject the entire shipment lot. Aspect
shall have [**] days from receipt of a notice from HP rejecting an Aspect
Product either, at its option, to make any necessary repairs to the defective
Aspect Product or to replace it. If Aspect replaces an Aspect Product, HP shall
dispose of the replaced Aspect Product in accordance with Aspect's instructions
and at Aspect's expense. HP's sole remedy for rejected Aspect Products shall be
limited to repair or replacement of such Aspect Products.

11. WARRANTY.

          (a)  General. Aspect warrants solely to HP that Aspect Products
               (including Software) delivered hereunder shall perform
               substantially in accordance with the specifications in Exhibit B
               (Aspect's Standard Module Kit) or other applicable product
               specifications as published by Aspect in effect at the time of
               delivery of such Aspect Product (including Software), and shall
               be free from defects in materials and workmanship, when given
               normal, proper and intended usage, for twelve months from the
               date of installation of the HP BIS System at HP's end customer
               site, or eighteen months from the date of shipment by Aspect to
               HP, whichever is less . Aspect agrees, during the applicable
               warranty period, to repair or replace (at Aspect's option) all
               defective Aspect Products within 30 days after date of return to
               Aspect and without cost to HP. This warranty shall not apply to
               expendable components and supply items, such as, but not limited
               to, cables (except for failures occurring within 180 days of
               receipt of shipment), fuses and bulbs (or disposable items such
               as an Aspect BIS Sensor after the expiration date marked on the
               Sensor packaging); nor shall Aspect have any obligation under
               this Agreement to make repairs or replacements which are required
               by normal wear and tear, or which result, in whole or in part,
               from catastrophe, fault or negligence of HP, or anyone claiming
               through or on behalf of HP, or from improper or unauthorized use
               of Aspect Products, or use of Aspect Products in a manner for
               which they were not designed, or by causes external to Aspect
               Products such as, but not limited to, power or air conditioning
               failure.

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

          (b)  Warranty Procedures. HP shall notify Aspect of any Aspect
               Products which it believes to be defective during the applicable
               warranty period and which are covered by the warranties set forth
               in paragraph (a). At Aspect's option, such Aspect Products shall
               be returned by HP to Aspect's designated facility for examination
               and testing, or may be repaired on site by Aspect. Aspect shall
               either repair or replace, within 30 days of receipt by Aspect,
               any such Aspect Product found to be so defective and promptly
               return such Aspect Products to HP. Transportation and insurance
               costs, and/or risk of loss or damage during shipments, shall be
               borne by Aspect. Should Aspect's examination and testing not
               disclose any defect covered by the foregoing warranty, Aspect
               shall so advise HP and dispose of or return the Aspect Product in
               accordance with HP's instructions and at HP's sole expense.

          (c)  Repair Warranty. Aspect warrants its repair work and/or
               replacement parts for the duration of the original warranty
               period as set forth in paragraph (a) or at least 6 months
               whichever is longer.

          (d)  LIMITATION. THE PROVISIONS OF THE FOREGOING WARRANTIES ARE IN
               LIEU OF ANY OTHER WARRANTY, WHETHER EXPRESS OR IMPLIED, WRITTEN
               OR ORAL (INCLUDING ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR
               A PARTICULAR PURPOSE). THE FOREGOING WARRANTIES EXTEND TO HP ONLY
               AND SHALL NOT BE APPLICABLE TO ANY OTHER PERSON OR ENTITY
               INCLUDING, WITHOUT LIMITATION, CUSTOMERS OF HP.

12. SERVICE AND SUPPORT.

          (a)  Service and Support. HP shall be responsible for providing
               installation, customer training, service and support (including
               repair) to its end customers for the Aspect Products sold
               hereunder and HP shall bear all related costs incurred for labor,
               parts, or travel to perform such service.

          (b)  Central Repair Service. For the term of this Agreement, Aspect
               agrees to provide central repair service to HP for Aspect
               Products sold hereunder at a charge and as further detailed in
               Exhibit F (Service/Repair).

          (c)  Excessive Failure Rate. If the Annual Failure Rate of Aspect's
               BIS Module Kit excluding out-of-box failures and cables exceeds
               the value as specified in Exhibit B (Aspect's Standard Module
               Kit) by more than [**] then Aspect shall reimburse HP for any
               additional cost (including material and labor, ) incurred by HP
               for repairing the units in excess of the above limit.

          (d)  Service Period. For a period of [**] following the last delivery
               to HP of the applicable Aspect Product ordered by HP hereunder,
               Aspect shall make available repair service (or at Aspect's sole
               discretion, exchange units for the Aspect Products) for purchase
               by HP and third party users of the Aspect products at

                                       12

<PAGE>   13

               Confidential Materials omitted and filed separately with the
               Securities and Exchange Commission. Asterisks denote omissions.
               Aspect's then-current prices for such repair services and
               exchange units. After expiry of this [**] period, Aspect may, in
               its sole discretion, continue to supply repair services (and/or
               exchange units for the Aspect Products) subject to the mutual
               written agreement of the Parties.

          (e)  Service Reporting. Aspect shall maintain a complete record of all
               repair activities performed on any Aspect products received for
               repair, and will provide HP with a monthly report on all service
               actions including failure and repair statistics at a sub-
               assembly levelas laid down in Exhibit F (Service/Repair). Service
               Reports for each product shall be sent electronically by email to
               responsible procurement and technical marketing engineer (Contact
               Persons shown in Exhibit C, Contact Persons / Addresses).
               Rootcause analysis is to be performed and reported by Aspect in
               case of abnormal failures, incidents and malfunctions.

13. QUALITY ASSURANCE.

          (a)  Both parties agree to maintain ISO900x, EN460x, European
               directive 93/42/EEC Annex II ("MDD AX-II") certification status
               and compliance with the U.S. Food and Drug Administration's
               ("FDA") Quality System Regulation ("QSR"), the European Medical
               Device Directive ("MDD"), and other appropriate regulations
               pertinent to the development, manufacturing and marketing of this
               kind of medical product.

          (b)  All Products developed under this Agreement shall fully comply
               with the above quality requirements and guidelines (MDD AX-II,
               FDA QSR, etc.)

          (c)  If the actual Annual Failure Rate ("AFR") of the BIS Module Kit
               or subcomponents thereof exceeds the expected value specified in
               Exhibit B (Aspect's Standard Module Kit) by more than [**] then
               Aspect agrees to investigate the root cause of the problem and
               take the appropriate corrective actions to bring the AFR back
               into the specified range.

14. REGULATORY MATTERS.

          (a)  Aspect shall assume full regulatory responsibility for the Aspect
               Products, including obtaining and maintaining all applicable
               governmental authorizations and regulatory approvals required to
               distribute the BIS Module Kit. Both Parties will work together to
               develop a regulatory plan during phase 1 of the Project which
               defines precisely what these regulatory and localization
               requirements are for all countries where the HP BIS System is
               intended to be sold. In particular, Aspect shall be responsible
               for generating its own Device Master Record for the BIS Module
               Kit and obtaining the CE-mark. It is understood that the BIS
               Module Kit will be a component of the HP BIS System for which HP
               assumes full regulatory responsibility as provided in Section 14
               (c).

                                       13

<PAGE>   14

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

          (b)  HP shall assume full regulatory responsibility for the HP
               Products, including obtaining and maintaining all applicable
               governmental authorizations and regulatory approvals required to
               distribute the HP Patient Monitors and the HP BIS Module in all
               countries in the Territory.

          (c)  HP shall assume the regulatory responsibility for the combination
               of the Aspect and HP components in the HP BIS System. Aspect
               shall fully support HP as required in the process of obtaining
               regulatory approvals by making available to HP any required
               information, data, certificates, or technical files in the
               requested formats.

          (d)  For bringing the Aspect Products into the market in countries
               affected by the European Medical Device Directive ("MDD"), Aspect
               is the legally responsible manufacturer under the MDD as named in
               detail in Exhibit C (Contact Persons/Addresses). The Aspect
               Products shall be marked accordingly.

          (e)  HP and Aspect shall inform each other in writing immediately
               about any event that may require incident reporting in any
               country of the Territory.

          (f)  In the event of any recall of an Aspect Product required by a
               governmental agency for safety or efficacy reasons, or requested
               by Aspect at its sole discretion, which is the result of Aspect's
               failure to supply Aspect Products that (1) conform in all
               material respects to the applicable published specifications
               (including the specifications set forth in Exhibit B (Aspect's
               Standard Module Kit)) or (2) are free from defects in material
               and workmanship (when given normal, proper and intended usage),
               Aspect agrees to repair or replace at its own costs all Aspect
               Products subject to the recall and previously delivered to HP.
               Aspect also agrees to consult with HP to establish a reasonable
               process for managing the recall and Aspect shall be [**]
               (including, but not limited to [**] that are consistent with the
               recall process agreed to by the Parties. In the event the recall
               is not required by a governmental agency for safety or efficacy
               reasons, but is instead requested by Aspect at its sole
               discretion, Aspect will be responsible for determining the scope
               of the recall, including the number of units, timeframe for the
               recall, and criteria for completion. HP agrees to maintain all
               necessary sales records to facilitate the recall.

          (g)  HP may at its sole discretion delegate some of the obligations
               under this Section 14 to its subdistributors.

          (h)  For the purpose of facilitating product traceability, all
               Products purchased from Aspect by HP will require identification
               of an internal order number and tracking code.

15. PRODUCT CHANGES; DISCONTINUED PRODUCTS; FUTURE PRODUCTS; CONTINUED SUPPLY.

          (a)  Product Changes. Aspect shall have the right, at any time and
               from time to time, to make substitutions and modifications to
               Aspect Products, provided that such substitutions or
               modifications will not materially affect form, fit or function of
               Aspect

                                       14

<PAGE>   15

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

          Products. In the event that any proposed substitution or modification
          affects, in Aspect's reasonable judgment, the form, fit or function of
          a Aspect Product, Aspect shall give HP written notice of such proposed
          substitution or modification at least [**] days prior to its taking
          effect and HP shall have the right, during such [**] -day period and
          for [**] days thereafter, to order Aspect Products without such
          substitution or modification for delivery within [**] days after such
          substitution or modification takes effect. Aspect shall give written
          notice of any proposed change to the Aspect Products using the
          Supplier Change Notification Agreement Form (attached as Exhibit D)
          and provide the appropriate verification and validation information
          evaluating the affect on the HP BIS System. Notwithstanding anything
          to the contrary in the Change Notification Agreement Form, HP shall
          not unreasonably withhold its approval of any such changes.

     (b)  Discontinued Products. Aspect agrees to notify HP in writing not less
          than [**] in advance of the discontinuance of any Aspect Product. HP
          shall be able to place orders for at least [**] after receipt of the
          written notice in any case. In addition, HP shall be entitled to
          determine its lifetime-buy quantities and place a corresponding last
          purchase order.

     (c)  Future Products. The Aspect Products are designed for use in measuring
          the effects of anesthetic and sedative agents on the brain during
          surgery. In the event that Aspect develops a product involving a
          different type of index, patient sensor, or application, Aspect and HP
          agree to discuss a new agreement for the purchase of such new product
          or products by HP.

     (d)  Continued Supply. In the event that (a) Aspect makes an assignment for
          the benefit of creditors, or a receiver, trustee in bankruptcy or
          similar officer is appointed to take charge of any or all of Aspect's
          property, or Aspect files a voluntary petition under federal
          bankruptcy laws or similar state statutes or such a petition is filed
          against Aspect and is not dismissed within sixty (60) days, and (b)
          Aspect fails to deliver Aspect Products ordered by HP under this
          Agreement within [**] of the delivery date specified on a purchase
          order complying with Section 4 and accepted by Aspect in accordance
          with Section 4, upon request of HP, Aspect shall grant to HP, a
          nonexclusive license to use the Manufacturing Materials to make and
          have made the Aspect Products for use in the HP BIS System, until [**]
          after Aspect is ready and able to deliver Aspect Products to HP under
          the terms of this Agreement and has notified HP thereof. This includes
          a non-exclusive license to use any tools, design documentation, or any
          other manufacturing materials which may be necessary. The
          manufacturing materials supplied by Aspect shall include a list of the
          Aspect suppliers of parts for Aspect Products. Upon exercise by HP of
          the manufacturing license set forth above, HP shall pay Aspect a
          "Manufacturing License Fee" equal to the royalty specified on Exhibit
          A (Aspect's Products and Purchase Prices).

                                       15

<PAGE>   16

16. OWNERSHIP AND PROTECTION OF RESULTS.

     (a)  It is expressly agreed that neither Aspect nor HP will transfer to any
          Party any patent rights, copyrights or intellectual property of any
          kind that either Party owns at the effective date of this agreement.

     (b)  Aspect shall retain the title to and possession of any models,
          patterns, dies, molds, jigs, fixtures, and other tools made for or
          obtained in connection with this Agreement and solely related to the
          Aspect Products, even if made for, obtained by or paid for by HP.

     (c)  If there are developments (including patentable inventions) conceived,
          created or reduced to practice as part of the joint development
          project then the rights to such developments shall be retained (a) by
          Aspect if conceived, created or reduced to practice solely by Aspect,
          or (b) by HP, if solely conceived, created or reduced to practice by
          HP, or (c) jointly by HP and Aspect (without any duty to account to
          the other) if jointly developed by HP and Aspect provided that:

          HP shall assign to Aspect all rights to any development relating to
          Aspect's BIS Module Kit

          and Aspect shall assign to HP all rights to any development relating
          to the HP Patient Monitor or HP BIS Module subject to Aspect's
          retained rights to the BIS Protocol.

17. DOCUMENTATION AND TRAINING.

         Aspect agrees to provide HP with such product literature, operations
and maintenance manuals, other information and training (including training to
avoid possible misrepresentation of Aspect's Bispectral Index) as is mutually
agreed, to enable HP properly to sell and maintain Aspect Products, provided
that in no event shall the source code or source listings of Aspect Software be
required to be disclosed or provided by Aspect to HP pursuant to this Section 17
or otherwise. Such training needs to begin at least three months prior to
introduction of the HP BIS System and will be defined as part of the Project's
marketing plan.

18. CONFIDENTIALITY.

         No confidential information disclosed by either party to the other in
connection with this Agreement shall be disclosed to any person or entity other
than the recipient party's employees and contractors directly involved with the
recipient party's use of such information who are bound by written agreement to
protect the confidentiality of such information, and such information shall
otherwise be protected by the recipient party from disclosure to others with the
same degree of care accorded to its own confidential information of like
importance. In addition, each party and its representatives shall use the
confidential information only for the purposes specified under this Agreement
and such information shall not be used for any other purpose without the prior
written consent of the disclosing party. To be subject to this provision,
information must be delivered in writing and designated as proprietary or, if
initially delivered orally, must be confirmed

                                       16

<PAGE>   17

in writing as confidential within 30 days after the oral disclosure. Information
will not be subject to this provision if it is or becomes a matter of public
knowledge without the fault of the recipient party, if it was a matter of
written record in the recipient party's files prior to disclosure to it by the
other party, or if it was or is received by the recipient party from a third
person under circumstances permitting its unrestricted disclosure by the
recipient party. Upon termination of this Agreement, each party shall promptly
deliver to the other all confidential information of the other party in the
possession or control of such party and all copies thereof, provided that each
party may retain a copy thereof for archival purposes. The obligations under
this Section 18 shall continue for both parties for a period of 10 years after
delivery by Aspect to HP of the last Aspect Product under this Agreement. HP is
entitled to transmit confidential information of Aspect to Hewlett-Packard
Company and to its subsidiaries and affiliated companies. In this case these
companies may only use such information to the same extent as HP is entitled to
under this Agreement. HP will be responsible that these companies comply with
the confidentiality provisions of this Agreement.

19. INDEMNITIES.

     19.1. INDEMNITIES BY ASPECT.

          (a)  Except as provided below, Aspect shall defend and indemnify HP
               from and against any damages, liabilities, costs and expenses
               (including reasonable attorneys' fees and court costs) arising
               out of any claim that Aspect Products purchased and/or licensed
               hereunder infringe any patent or copyright or misappropriate a
               trade secret of a third party, provided that (i) HP shall have
               promptly provided Aspect written notice thereof and reasonable
               cooperation, information, and assistance in connection therewith,
               and (ii) Aspect shall have sole control and authority with
               respect to the defense, settlement, or compromise thereof. Should
               any Aspect Products delivered hereunder become or, in Aspect's
               opinion, be likely to become the subject of such a claim, Aspect
               may, at its option, either (x) procure for HP the right to
               continue purchasing and using such Aspect Products, or (y)
               replace or modify such Aspect Products so that they become
               non-infringing or if (x) and (y) are not reasonably available to
               Aspect, then (z) terminate HP's rights under this Agreement to
               purchase the allegedly infringing Product and refund to HP the
               amount which HP has paid to Aspect for such Products which are in
               the possession of HP, upon return of such Products in their
               unopened packages to Aspect at its principal facility in the
               United States (freight and insurance at Aspect's expense). In
               such event, Aspect may withhold further shipments of infringing
               or potentially infringing Aspect Products.

               Aspect shall have no liability or obligation to HP hereunder with
               respect to any patent, copyright infringement or trade secret
               misappropriation or claim thereof based upon

               (i)  compliance with designs, plans or specifications of HP,

               (ii) use of Aspect Products by HP in combination with devices or
                    products not purchased and/or licensed hereunder where the
                    Aspect Products would not themselves be infringing,

                                       17

<PAGE>   18

               (iii)use of the Aspect Products by HP in an application or
                    environment for which such Aspect Products were not designed
                    or contemplated, or

               (iv) modifications of the Aspect Products by HP

          (b)  Aspect's liability hereunder shall not exceed the purchase and/or
               license price paid by HP for the Aspect Products found to be
               infringing. The foregoing states the entire liability of Aspect
               with respect to infringement or misappropriation of patents,
               copyrights and trade secrets by the Products or any part thereof
               or by their operation.

          (c)  In the event that any claim is brought against HP as a result of
               personal injuries and/or property damages resulting from that
               portion of the HP BIS System developed and manufactured by
               Aspect, and provided further that such claims do not arise as a
               result of the misuse of the HP BIS System , or the use of the HP
               BIS System in an application for which it was not designed by
               Aspect, where such claim would not have occurred but for such
               misuse or use, Aspect agrees that it shall indemnify and hold HP
               harmless from and against any damages, liabilities, costs and
               expenses arising out of such claim, provided that HP shall
               promptly provide Aspect written notice thereof and reasonable
               cooperation, information and assistance in connection therewith
               and Aspect shall have sole control and authority with respect to
               the defense, settlement or compromise.

         19.2.    INDEMNITIES BY HP.

              (a) Except as provided below, HP shall defend and indemnify Aspect
              from and against any damages, liabilities, costs and expenses
              (including reasonable attorneys' fees and court costs) incurred by
              Aspect as a result of or arising from HP's activities under this
              Agreement, including, without limitation, product liability,
              customer warranty and service claims, provided that

               (i)  Aspect shall have promptly provided HP written notice
                    thereof and reasonable cooperation, information and
                    assistance in connection therewith, and

               (ii) HP shall have sole control and authority with respect to the
                    defense, settlement or compromise thereof, and provided
                    further that

              (iii) HP shall not be liable to Aspect under this Section 19.2 to
                    the extent that such damages, liabilities, costs and
                    expenses arise from Aspect's negligence or a breach of any
                    representation or warranty by Aspect hereunder.

20. TRADEMARKS.

     20.1. ASPECT TRADEMARKS.

          (a)  Ownership. HP acknowledges and agrees that Aspect is the sole and
               exclusive owner of all right, title and interest in and to the
               trademarks (the "Aspect Trademarks") identified on Exhibit H
               (Aspect Trademarks). HP recognizes the value of the Aspect
               Trademarks and the good will associated with the Aspect
               Trademarks. HP agrees that its use of the Aspect Trademarks and
               any good will

                                       18

<PAGE>   19

          arising therefrom shall inure to the benefit of Aspect. Nothing
          contained herein shall create, nor shall be construed as an assignment
          of, any right, title or interest in or to the Aspect Trademarks to HP,
          other than the grant of a license in Section 20.1 (c) below; it being
          acknowledged and agreed that all other right, title and interest in
          and to the Aspect Trademarks is expressly reserved by Aspect. HP shall
          keep the Aspect Trademarks free from all liens, mortgages or other
          encumbrances. HP agrees that it will not attack or otherwise challenge
          the title, validity or any other rights of Aspect in or to the Aspect
          Trademarks.

          (b)  Notice. All HP BIS Systems that use the Aspect Trademarks shall
               be accompanied, where reasonable and appropriate, by a
               proprietary notice consisting of the following elements:

               (i)  The statement "[insert trademark(s)] is a trademark(s) of
                    Aspect Medical Systems, Inc."

               (ii) HP will include the "(TM)" or "(R)" symbol, as instructed by
                    Aspect, after the first prominent use of the Aspect
                    Trademark in the HP Patient Monitor and related materials.
                    HP shall have a period of 30 days in which to begin to use
                    the "(R)" symbol in replacement of the "(TM)" symbol upon
                    receiving instruction to do so by Aspect. HP may continue to
                    deliver stocked literature before the change becomes
                    effective.

              (iii) HP shall reproduce copyright and trademark notices of Aspect
                    on the "splash screen" or in the same location where HP
                    reproduces its own copyright notices .

          (c)  License. Aspect hereby grants to HP a nonexclusive, worldwide,
               royalty-free license (without the right to sublicense) to use the
               Aspect Trademarks to designate and promote Aspect Products in HP
               BIS Systems. HP shall have no other right to use, display or
               utilize the Aspect Trademarks for any other purpose or in any
               other manner.

          (d)  Quality Standards.

               (i)  Upon reasonable notice and request, and at a mutually
                    acceptable date and location, Aspect may inspect the
                    advertising and promotional materials on which the Aspect
                    Trademarks are used so that Aspect may monitor compliance
                    with this Agreement.

               (ii) Compliance. Aspect acknowledges the high standards of
                    quality and excellence established by HP with respect to
                    products bearing HP's trademarks. HP acknowledges the high
                    standards of quality and excellence established by Aspect
                    with respect to products bearing the Aspect Trademarks. HP
                    agrees that HP Patient Monitors with which the Aspect
                    Trademarks are used shall be of such quality so as to
                    maintain such high standards and to reflect well upon
                    Aspect. HP agrees to adhere to HP's own or the following
                    quality standards (whichever may be more rigorous) for use
                    of the Aspect Trademarks by HP:

                    -    In order to ensure that Aspect Products and HP Patient
                         Monitors distributed under the Aspect Trademarks comply
                         with the consistent quality standards of Aspect, all
                         Aspect Products and HP Patient Monitors distributed by
                         or for HP

                                       19

<PAGE>   20

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

                         which bear an Aspect Trademark shall conform to those
                         standards which Aspect provides to HP in writing. HP
                         shall cause each major new release of such HP Patient
                         Monitors to comply with such standards or remove the
                         Aspect Trademark(s) from any such new release, which
                         does not comply with such standards. HP shall have a
                         period of 30 days in which to bring newly shipped HP
                         Patient Monitors into compliance with any standard
                         provided to it by Aspect following the date of this
                         Agreement.

                    -    HP acknowledges that if Aspect Products or HP Patient
                         Monitor products bearing the Aspect Trademarks fail to
                         satisfy the quality standards set forth above, the
                         substantial good will which Aspect have built and now
                         possess in the Aspect Products and in the Aspect
                         Trademarks will be impaired.

          (e)  Protection and Infringement. HP agrees to cooperate with and
               assist Aspect in obtaining, maintaining, protecting, enforcing
               and defending Aspect' proprietary rights in and to the Aspect
               Trademarks. In the event that HP learns of any infringement,
               threatened infringement or passing-off of the Aspect Trademarks,
               or that any third party claims or alleges that the Aspect
               Trademarks infringe the rights of the third party or are
               otherwise liable to cause deception or confusion to the public,
               HP shall notify Aspect giving the particulars thereof, and HP
               shall provide necessary information and assistance to Aspect in
               the event that Aspect decides that proceedings should be
               commenced.

          (f)  Termination. In addition to the termination rights set forth in
               Section 23 hereof, in the event that HP is in material breach of
               any provision of this Section 20, Aspect may, upon [**] written
               notice, terminate the license granted in Section 20.1 (c) if HP
               does not cure such breach or default within such [**] period. The
               parties recognize that curing such breach or default may require
               development of a new version of HP BIS System. If this is the
               case, then HP will be deemed to have cured such breach or default
               if, within the [**] cure period, HP presents to Aspect a plan for
               revision of HP Product that will cure such breach or default,
               such plan is reasonably acceptable to Aspect, and such revision
               is released and distributed within three months following written
               notice of such breach or default.

               In addition to the provisions of Section 23 hereof, upon
               termination of the license granted in Section 20.1 (c), or upon
               termination of this Agreement, for whatever cause:

               (i)  HP shall immediately cease and desist from any further use
                    of the Aspect Trademarks and any trademarks confusingly
                    similar thereto, either directly or indirectly;

               (ii) All rights in the Aspect Trademarks granted to HP hereunder
                    shall immediately revert to Aspect;

              (iii) In the event that this Agreement is terminated for any
                    reason other than a material breach or material default by
                    HP, HP shall have a period of 30 days thereafter to dispose
                    of all of the unsold HP BIS Systems bearing the

                                       20

<PAGE>   21

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

                    Trademarks and advertising and promotional materials
                    relating thereto which had been completed by it prior to
                    such termination, provided such HP BIS Systems and materials
                    were in the process of manufacture more than [**] before
                    such termination.

          (g)  Promotional Claims. The general form of any promotional claims by
               HP regarding Aspect's Bispectral Index technology and/or the
               integration of this technology in HP Patient Monitors, and the
               specific form of the use of Aspect's trade names and trademarks,
               and of intended use claims regarding Aspect's Bispectral Index
               technology, in promotional material, advertisement, and/or in
               written technical literature shall be subject to review and
               approval by Aspect prior to its publication or display.

     20.2. HP TRADEMARKS.

          (a)  The general form of any potential claim by Aspect that HP uses
               Aspect's Bispectral Index technology as part of the HP Patient
               Monitors, and the specific form of the use of HP's trade names
               and trademarks in promotional material, advertisement, and/or in
               written technical literature shall be subject to review and
               approval by HP prior to its publication or display.

          (b)  Upon termination of this Agreement any reference to HP and it's
               trademarks must be immediately removed from any literature or
               other display and must no longer be distributed.

21. EXPORT.

     HP shall not export, directly or indirectly, HP BIS Systems or other
     products, information or materials provided by Aspect hereunder, to any
     country for which the United States requires any export license or other
     governmental approval at the time of export without first obtaining such
     license or approval. It shall be HP's responsibility to comply with the
     latest United States export regulations, and HP shall defend and indemnify
     Aspect from and against any damages, fines, penalties, assessments,
     liabilities, costs and expenses (including reasonable attorneys' fees and
     court costs) arising out of any claim that HP BIS Systems or other
     products, information or materials provided by Aspect hereunder were
     exported or otherwise shipped or transported in violation of applicable
     laws and regulations.

22. CO-MARKETING PROGRAM.

     (a)  HP and Aspect may agree to undertake co-marketing programs in certain
          geographies.

     (b)  HP and Aspect have agreed on a co-marketing program in North America
          as described in Exhibit G (Co-Marketing Program) to this Agreement.

                                       21

<PAGE>   22

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

23. TERM; DEFAULT AND TERMINATION.

    23.1. TERM AND RENEWAL.

          The initial term of this Agreement shall commence on the date first
          specified above (the "Effective Date") and shall continue for a period
          of 6 years. The term of this Agreement shall be automatically renewed
          for successive 12 month periods unless either party provides written
          notice of termination to the other party at least 60 days prior to
          expiration of the Agreement.

    23.2. TERMINATION FOR GOOD CAUSE.

          (a)  The Agreement may be terminated by Aspect giving 30 days written
               notice to HP in the event HP has not commercially introduced an
               HP BIS System by October 31st 2001.

          (b)  The Agreement may be terminated by HP giving 30 days written
               notice to Aspect if Aspect has failed to provide a BIS Module Kit
               with the necessary regulatory approvals to HP by [**].

          (c)  Events of Default. The following shall constitute events of
               default under this Agreement:

               (i)  if either Party assigns this Agreement or any of its rights
                    or obligations hereunder except in connection with the sale
                    of such Party's business to which this Agreement relates
                    (the word "assign" to include, without limiting the
                    generality thereof, a transfer of a majority interest in the
                    Party) without the prior written consent of the respective
                    other Party. Notwithstanding the foregoing, it is understood
                    that this Agreement shall be assigned to Agilent
                    Technologies GmbH, at Herrenberger Strasse 110 - 130,
                    D-71034 Boeblingen, Germany and that Aspect consents to such
                    assignment.; or

               (ii) if either Party shall neglect or fail to perform or observe
                    any of its obligations to the other Party hereunder,
                    including, without limiting the generality thereof, the
                    timely payment of any sums dueor Aspect's inability to
                    deliver Aspect Products, and such failure is not cured
                    within [**] in the event of a default in the payment of
                    amounts owed the other Party) after written notice thereof
                    from the other Party; or

              (iii) if there is (w) a dissolution, termination of existence,
                    liquidation, insolvency or business failure of either Party,
                    or the appointment of a custodian or receiver of any part of
                    either Party's property, if such appointment is not
                    terminated or dismissed within thirty (30) days; (x) a
                    composition or an assignment or trust mortgage for the
                    benefit of creditors by either Party; (y) the commencement
                    by either Party of any bankruptcy proceeding under

                                       22

<PAGE>   23

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

                    the United States Bankruptcy Code or any other federal or
                    state bankruptcy, reorganization, receivership, insolvency
                    or other similar law affecting the rights of creditors
                    generally; or (z) the commencement against either Party of
                    any proceeding under the United States Bankruptcy Code or
                    any other federal or state bankruptcy, reorganization,
                    receivership, insolvency or other similar law affecting the
                    rights of creditors generally, which proceeding is not
                    dismissed within thirty (30) days.

          (d)  Remedies. Upon any event of default, and in addition to any other
               remedies either Party may have at law or in equity, the
               non-defaulting Party may cancel any outstanding Order, refuse to
               make or take further Orders or deliveries, cancel any discount
               given, and declare all obligations immediately due and payable.
               The non-defaulting Party shall have all the remedies of a secured
               party under the Uniform Commercial Code and any other applicable
               law. The defaulting Party shall be liable for the other Party's
               expense of retaking, holding, preparing for sale, selling and the
               like, including reasonable attorneys' fees and legal expenses in
               the event of default. Cancellation fees shall not be due and
               payable.

    23.3. INSURANCE.

          Upon request, Aspect shall provide evidence of product liability,
          general liability and property damage insurance against an insurable
          claim or claims which might or could arise regarding Aspect products
          purchased from Aspect. Such insurance will contain a minimum limit of
          liability for bodily injury and property damage of not less than
          2,000,000 (two million) US$.

24. GENERAL PROVISIONS.

     (a)  Force Majeure. In the event that either Party is prevented from
          performing, or is unable to perform, any of its obligations under this
          Agreement due to any act of God, fire, casualty, flood, war, strike,
          lock out, failure of public utilities, injunction or any act,
          exercise, assertion or requirement of governmental authority,
          epidemic, destruction of production facilities, insurrection,
          inability to procure materials, labor, equipment, transportation or
          energy sufficient to meet manufacturing needs, or any other cause
          beyond the reasonable control of the Party invoking this provision,
          and if such Party shall have used its best efforts to avoid such
          occurrence and minimize its duration and has given prompt written
          notice to the other Party, then the affected Party's performance shall
          be excused and the time for performance shall be extended for the
          period of delay or inability to perform due to such occurrence.

     (b)  Publicity. Neither Party shall originate any publicity, news release
          or other public announcement relating to this Agreement or the
          existence of an arrangement between the Parties without the prior
          written approval of the other Party, except as otherwise required by
          law.

                                       23

<PAGE>   24

     (c)  Waiver. The waiver by either Party of a breach or a default of any
          provision of this Agreement by the other Party shall not be construed
          as a waiver of any succeeding breach of the same or any other
          provision, nor shall any delay or omission on the part of either Party
          to exercise or avail itself of any right, power or privilege that it
          has, or may have hereunder, operate as a waiver of any right, power or
          privilege by such Party.

     (d)  No Agency. Nothing contained in this Agreement shall be deemed to
          constitute either Party as the agent or representative of the other
          Party, or both Parties as joint ventures or partners for any purpose.
          Neither Party shall be responsible for the acts or omissions of the
          other Party, and neither Party will have authority to speak for,
          represent or obligate the other Party in any way without prior written
          authority from the other Party.

     (e)  Survival of Obligations. All obligations of either Party which, by
          their nature, require performance after the expiration or termination
          of this Agreement, namely the sections on Royalties (5.(c)), Warranty
          (11), Service and Support (12), Regulatory Matters (14), Ownership and
          Protection of Results (16), Confidentiality (18), Indemnities (19),
          Trademarks (20) shall survive the expiration or termination of this
          Agreement and continue to be enforceable.

     (f)  LIMITATION ON LIABILITY. EXCEPT AS PROVIDED IN SECTION 19.1, ASPECT'S
          LIABILITY ARISING OUT OF THE MANUFACTURE, SALE OR SUPPLYING OF ASPECT
          PRODUCTS OR THEIR USE OR DISPOSITION, WHETHER BASED UPON WARRANTY,
          CONTRACT, TORT OR OTHERWISE, SHALL NOT EXCEED THE AMOUNT OF
          2,000,000.00 (TWO MILLION) US$. IN NO EVENT SHALL ASPECT BE LIABLE TO
          HP OR ANY OTHER PERSON OR ENTITY FOR SPECIAL, INCIDENTAL,
          CONSEQUENTIAL, OR OTHER INDIRECT DAMAGES (INCLUDING, BUT NOT LIMITED
          TO, LOSS OF PROFITS, LOSS OF DATA OR LOSS OF USE DAMAGES) ARISING OUT
          OF THE MANUFACTURE, SALE OR SUPPLYING OF ASPECT PRODUCTS.

     (g)  Severability. In the event that any provision of this Agreement is
          held by a court of competent jurisdiction to be unenforceable because
          it is invalid or in conflict with any law of any relevant
          jurisdiction, the validity of the remaining provisions shall not be
          affected and the rights and obligations of the Parties shall be
          construed and enforced as if the Agreement did not contain the
          particular provisions held to be unenforceable.

     (h)  Governing Law. This Agreement shall be governed by and construed in
          accordance with the laws of the Commonwealth of Massachusetts.

     (i)  Notices. Any notice or communication with regard to the termination of
          or changes to this Agreement from one Party to the other shall be in
          writing and either personally delivered or sent via certified mail,
          postage prepaid and return receipt requested addressed, to such other
          Party at the address of such Party specified in this Agreement or such
          other address as either Party may from time to

                                       24

<PAGE>   25

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

          time designate by notice hereunder.

     (j)  Entire Agreement. This Agreement constitutes the entire agreement
          between the Parties. No waiver, consent, modification or change of
          terms of this Agreement shall bind either Party unless in writing
          signed by both Parties, and then such waiver, consent, modification or
          change shall be effective only in the specific instance and for the
          specific purpose given. There are no understandings, agreements,
          representations or warranties, expressed or implied, not specified
          herein regarding this Agreement or the Aspect Products purchased
          and/or licensed hereunder. Only the terms and conditions contained in
          this Agreement shall govern the transactions contemplated hereunder,
          notwithstanding any additional, different or conflicting terms which
          may be contained in any Order or other document provided by one Party
          to the other. Failure of Aspect to object to provisions contained in
          any Order or other document provided by HP shall not be construed as a
          waiver of the terms and conditions of this Agreement nor an acceptance
          of any such provision. Retention by HP of Aspect Products delivered
          hereunder shall be conclusively deemed to be a confirmation of the
          terms and conditions hereof.

     (k)  Headings. Captions and headings contained in this Agreement have been
          included for ease of reference and convenience and shall not be
          considered in interpreting or construing this Agreement.

     (l)  Exhibits: The following Exhibits shall be part of this Agreement:

                    Exhibit A:         Aspect Products and Purchase Prices

                    Exhibit B:         Aspect's Standard Module Kit

                    Exhibit C:         Contact Persons/Addresses Prices

                    Exhibit D:         Change Notification Agreement

                    Exhibit E:         Delivery and Packaging Standard

                    Exhibit F:         Service/Repair

                    Exhibit G:         Co-Marketing Program

                    Exhibit H:         Aspect Trademarks

                    Exhibit I:         [**]

         IN WITNESS WHEREOF, this Agreement has been duly executed as a sealed
instrument as of the date specified above.

Aspect Medical Systems, Inc.                       Hewlett-Packard GmbH

By: /s/ J. Breckenridge Eagle                By: /s/ Anthony [illegible]
   --------------------------                   ------------------------------
Title:  Chairman                             Title:    General Manager
      -----------------------                      ---------------------------
                                                   Patient Monitoring Division

                                       25

<PAGE>   26

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

                EXHIBIT (A):ASPECT'S PRODUCTS AND PURCHASE PRICES
<TABLE>
<CAPTION>

ORDERABLE                                  ASPECT             HP         UNITS (EA)       Aspect               HP          ROYALTIES
PARTS / PRODUCTS                          PART NO.         ID Number     CASES (PK)     List Price         Base Price        (US$)
                                                                                           (US$)        (US$) - Note A
----------------------------------        --------         ---------     ----------     ----------      ---------------    ---------
<S>                                      <S>               <C>           <C>            <C>             <C>                <C>
BIS MODULE KIT (new unit, includes          tbd               tbd           1 ea           [**]               [**]            [**]
DSC, DSC Cable, HP BIS Engine,
Module Cable, User Manual)

Sensor Startup Kit                                                          5 ea                              [**]            [**]

DSC (replacement)                                                                                             [**]            [**]

DSC Cable (replacement)                                                                                       [**]            [**]

HP BIS Engine (replacement)                                                                                   [**]            [**]

Module Cable (replacement)                                                                                    [**]            [**]

User Manual                                                                                                   [**]            [**]
Service Manual                                                                                                [**]            [**]

BIS Application Note (english)                                                                                [**]            [**]

BIS Application Note (french)                                                                                 [**]            [**]

 ...                                                                                                                           [**]
BIS Brochure                                                                                                  [**]            [**]
                                                                                                                              [**]

</TABLE>

Note A:

The HP Purchase Price is the sum of the [**] (based on [**] and the [**] (based
on [**]. In addition to the [**] specified above, HP shall pay to Aspect for
each BIS Module Kit purchased an additional sum to allow Aspect to recover the
incremental costs for Aspect to provide the [**] (including the [**] in lieu of
[**]. It is currently estimated that these incremental costs will be [**] per
module kit.

                                       26

<PAGE>   27

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

EXHIBIT (B):              ASPECT'S STANDARD MODULE KIT

ASPECT'S STANDARD BIS MODULE KIT.

Aspect's BIS 'Module Kit' is designed specifically for [**] and allows the [**]
and to the [**] and the necessary power connections.

The BIS Module Kit consists of a [**] that is placed in [**] that provides the
[**] the high performance analog to [**] of the [**] from the [**] that is [**]
at the [**].

The BIS Engine [**] on the [**] to the [**] via the [**] is constructed [**] to
the [**] are a [**]

       Detailed Technical Specifications:
       ----------------------------------

       Digital Output:              [**]
                                    [**]

       Main Parameters:             [**]
                                    [**]

       Electrical Safety:           [**]

       Power:                       [**]
                                    [**]
                                    [**]

       Artifact Rejection:          [**]

       Bispectral Index:            [**]

       Digital Signal Converter (DSC-2)
       --------------------------------
       Description:                 [**]

                                       27

<PAGE>   28

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

       Weight:                      [**]

       Dimensions:                  [**]
                                    [**]

       Cable Length:                [**]

BIS Engine PCB

       Physical:                    [**]

       Processing Power:            [**]

Software Upgrades

       [**] software is stored in [**]. Software upgrades can be [**] via the
       [**].

Serial Identifier

       [**] is given a [**]. This allows for [**] of every [**].

Annual Failure Rate

       The current [**] rate for the [**] and the [**] of the Project, this
       information will need to be [**]

                                       28

<PAGE>   29

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

                     Exhibit (C): Contact Persons/Addresses

                   Contact Persons and responsibilities at HP:
                   ------------------------------------------

 -------------- ------------- ---------------------- --------------------
  Person         Title         Responsibility         E-mail
                                                      Phone Number/
                                                      Fax Number
 -------------- ------------- ---------------------- --------------------
 [**]            [**]          [**]                   [**]
 -------------- ------------- ---------------------- --------------------

MAILING ADDRESS:    Hewlett-Packard GmbH
                    [**]

PHONE:              [**]

INVOICE ADDRESS:    Hewlett-Packard GmbH

                                       29
<PAGE>   30

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

                     Exhibit (C): Contact Persons/Addresses

                Contact Persons and responsibilities at Aspect:
                -----------------------------------------------

 -------------- ------------- ---------------------- --------------------
  Person         Title         Responsibility         E-mail
                                                      Phone Number/
                                                      Fax Number
 -------------- ------------- ---------------------- --------------------
 [**]            [**]          [**]                   [**]
 -------------- ------------- ---------------------- --------------------

MAILING ADDRESS:    Aspect Medical Systems, Inc.
                    2 Vision Drive
                    Natick, MA 01760-2059
                    USA

                                       30
<PAGE>   31

EXHIBIT (D):  CHANGE NOTIFICATION AGREEMENT FORM

                                       31

<PAGE>   32

--------------------------------------------------------------------------------
                     Hewlett-Packard Medical Products Group
--------------------------------------------------------------------------------

MPG SUPPLIER CHANGE NOTIFICATION AGREEMENT FORM

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

NOTICE         UNCONTROLLED IN PRINTED FORM UNLESS STAMPED IN RED

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

DOCUMENT     The document owner is listed below:
OWNERSHIP

             --------------------------------- ---------------------------------
                         FUNCTION                            TITLE
             --------------------------------- ---------------------------------
              MPG Quality Department            Quality System Engineer
             --------------------------------- ---------------------------------

                         ---------- ------------------ -------------------------
REVISION HISTORY
                         ---------- ------------------ -------------------------
                           REV. #     CHANGE ORDER #        CHANGE SUMMARY
                         ---------- ------------------ -------------------------
                             A      2920-1998-01-00009
                         ---------- ------------------ -------------------------
                             B      2920-1998-01-00019  Revise footer to read
                                                        "HP Proprietary".
                                                        Separate "Contact for
                                                        Questions" and Return
                                                        To".
                         ---------- ------------------ -------------------------

                                       32

Rev. B  Document Number: A-Q2920-00142    GRS#MF502                  Page 1 of 2
Title: MPG Supplier Change Notification Agreement Form  For HP Internal Use Only

<PAGE>   33

--------------------------------------------------------------------------------
                     Hewlett-Packard Medical Products Group
--------------------------------------------------------------------------------

MPG SUPPLIER CHANGE NOTIFICATION AGREEMENT FORM, continued

--------------------------------------------------------------------------------
 TO:                                     FROM:
--------------------------------------  ----------------------------------------
 SUPPLIER NAME:                          DATE:
--------------------------------------  ----------------------------------------
 SUPPLIER FAX # OR ADDRESS:
                          ----------------------------------------------------

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

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

--------------------------------------------------------------------------------
DEAR SUPPLIER, CONTRACTOR, OR CONSULTANT:
Hewlett Packards's Medical Products Group (MPG) manufactures in a regulated
environment, and is required to maintain procedures to ensure that all purchased
products and services conform to specified requirements. MPG has determined that
the product or service you supply to MPG impacts, directly or indirectly, the
quality of our finished devices. We ask that you agree to notify MPG of any
changes in the product or service, so that we can determine whether the change
may affect the quality of our finished devices. Although HP's standard purchase
order terms and conditions include this provision, the intent of this document
is to ensure direct supplier recognition and acceptance of this requirement.
TO ENSURE THAT MPG HAS YOUR AGREEMENT ON THIS REQUIREMENT, WE ASK THAT YOU
REVIEW AND SIGN THE AGREEMENT BELOW. IT IS REQUESTED THAT THE SIGNATORY BE THE
QUALITY MANAGER AND THE GENERAL MANAGER (OR DESIGNEE) DIRECTLY INVOLVED WITH THE
MANUFACTURER OF OUR PRODUCT.

--------------------------------------------------------------------------------
                          CHANGE NOTIFICATION AGREEMENT
                          -----------------------------

Changes to product, components or services supplied to Hewlett Packard Medical
Products Group (MPG) will not be made without prior written notification to, and
written approval from, MPG. This includes, but is not limited to, the following
types of changes:
*  Product or service design changes
* Production process changes that affect design and/or production specifications
* Change of manufacturing or service facility location
* Changes that have a significant impact upon your quality system
* Other
       -----------------------------------------------------------------------
Notification must be made to each MPG purchasing location affected by this
change.
--------------------------------------------------------------------------------
SUPPLIER COMMENTS:
                  ------------------------------------------------------------

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

--------------------------------------------------------------------------------
QUALITY MGR:                            GENERAL MGR (OR DESIGNEE):
--------------------------------------  ----------------------------------------
SIGNATURE:                                                   SIGNATURE:
DATE:                                                        DATE:
                                                             TITLE:
--------------------------------------  ----------------------------------------
CONTACT FOR QUESTIONS:                                       TELE:
--------------------------------------  ----------------------------------------
RETURN TO:
--------------------------------------------------------------------------------
STREET:                                                      CITY/STATE/ZIP:
TELE:                                                        FAX:
--------------------------------------------------------------------------------

                                       33
<PAGE>   34

EXHIBIT (E):  DELIVERY AND PACKAGING STANDARD

                                       34
<PAGE>   35

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

 HEWLETT-PACKARD GMBH                    DELIVERY-AND PACKAGING STANDARD
 HEWLETT-PACKARD EUROPE BV

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

 ORIGINATOR:  HP/CPDE-ENGINEERING, G-BOBLINGEN

 TABLE OF CONTENTS                                        PAGE
 -----------------                                        ----

1.       GENERAL
1.1.     Applicability                                     2
1.2.     Place of delivery                                 2

2.       DEFINITIONS                                       2

3.       IDENTIFICATION REQUIREMENTS                       3
3.1.     Delivery Note                                     3
3.2.     Load Unit Label                                   4
3.3.     Product Identification Label                      5
3.4.     Customs Declaration                               5
3.5.     Transport Declaration (Dangerous Goods)           5

4.       PACKAGING REQUIREMENTS                            6
4.1.     Delivery Mode                                     6
4.2.     Packages (Boxes)                                  6
4.3.     Load Carriers (Pallets)                           6
4.4.     Dimensions                                        7
4.5.     Load Unit Protection                              7
4.6.     Environmental Requirements                        7
4.7.     Transport Regulations (Dangerous Goods)           7
4.8.     Treatment of Inconsistencies                      8

5.       REVISION CONTROL                                  8

                                       35
<PAGE>   36

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

 HEWLETT-PACKARD GMBH                    DELIVERY-AND PACKAGING STANDARD
 HEWLETT-PACKARD EUROPE BV

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

1.       GENERAL
----------------

1.1.     APPLICABILITY
         This specification is applicable to all goods delivered to the premises
         of Hewlett-Packard Businesses in Boblingen and Waldbronn with according
         production plants and distribution centers in Europe.

         Practices other than those stipulated herein must be ratified on a
         case-by-case basis by the purchasing department concerned.
         Hewlett-Packard reserves the right to reject deliveries that do not
         comply with this specification.

1.2.     PLACE OF DELIVERY
         Since HP has several receiving locations in Europe it is essential that
         goods be delivered to the address specified on the purchase order or in
         the purchasing agreement.

2.       DEFINITIONS
--------------------

         [Graphic depiction of track, load units, product labels, load
         carrier/pallet, package/box and mother/box]

                                       36
<PAGE>   37

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

 HEWLETT-PACKARD GMBH                    DELIVERY-AND PACKAGING STANDARD
 HEWLETT-PACKARD EUROPE BV

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

3.       IDENTIFICATION REQUIREMENTS
------------------------------------

3.1.     DELIVERY NOTE:
         no deliveries without a delivery note
         delivery note has to be fixed on the outside of the load or handed out
         by the freight forwarder

--------------------------------------------------------------------------------
                          DELIVERY NOTE / LIEFERSCHEIN

Supplier:
Fa Meler u Sohne
Kaakonbachatr 34
8000 Monehen
Tel:  (089) 2804-1999

--------------------------------------------------------------------------------
SUPPLIER CODE  0055885
--------------------------------------------------------------------------------

--------------------------------------  ----------------------------------------
DELIVERY NOTE NO.:  349812              DATE:  16.01.1999
--------------------------------------  ----------------------------------------
SHIP TO:
Hewlett-Packard GmbH
c/o Logistic Group International
Waldbronn Gebaude 5
Herronbarger Str. 124
71034 Boblingen
--------------------------------------------------------------------------------
RECEIVING ENTITY/NAME:  CPOE / Hohenstein
--------------------------------------------------------------------------------
DESTINATION CODE                    BB14-4500
--------------------------------------------------------------------------------
LOAD UNIT:                          12 boxes on 3 pallets
--------------------------------------------------------------------------------
BOX NO'S:                           6016-XX001 - 6016-XXX12
--------------------------------------------------------------------------------

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

--------------------------------------------------------------------------------
POS. HP ORDER NO.  SECTION      ITEM     HP PART NO.    QUALITY    UNIT MEASURED
      (9 digits)  (3 digits) (4 digits)                 (shipped)    (shipped)
---- ------------ ---------- ---------- ------------- ----------- --------------
     [Graphic depiction of bar codes]
---- ---------------------------------------------------------------------------
 01   N81853921    010.       0100        8120-6809     1000        EA
---- ------------ ---------- ---------- ------------- ----------- --------------
 DESCRIPTION:  Powercord:  UK version
--------------------------------------------------------------------------------
     [Graphic depiction of bar codes]
---- ---------------------------------------------------------------------------
 02   N81853821    0100       010         5964-6108     1200        EA
---- ------------ ---------- ---------- ------------- ----------- --------------
DESCRIPTION:  Software & Accessories Broschore
--------------------------------------------------------------------------------
COUNTRY OF ORIGIN  Germany    [Graphic depiction of bar codes]
--------------------------------------------------------------------------------

                           OPTIONAL DATA PER BUSINESS
        -----------
Legend:  MUST DATA
        -----------

                                       37
<PAGE>   38

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

 HEWLETT-PACKARD GMBH                    DELIVERY-AND PACKAGING STANDARD
 HEWLETT-PACKARD EUROPE BV

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

32.      LOAD UNIT LABELS
         (unique products only)
An adhesive label shall be affixed to each load unit. If a delivery is
consisting of multiple, separate load units, the individual load unit shall be
numbered consecutively (e.g., 1 of 7, 2 of 7, etc.)
--------------------------------------------------------------------------------
                    LOAD UNIT LABEL/LADEENIHEITENAUSZEICHUNG
                (UNIQUE PRODUCTS ONLY       NUR SORTENREINE WARE)

Supplier:
Fa Meler u Sohne
Kaakonbachatr 34
8000 Monehen
Tel:  (089) 2804-1999
--------------------------------------------------------------------------------
SUPPLIER CODE  0055865
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
DELIVERY NOTE NO.:  349912              DATE:  15.01.1999
--------------------------------------  ----------------------------------------
SHIP TO:
Hewlett-Packard GmbH
c/o Logistic Group International
Waldbronn Gebaude 5
Herronbarger Str. 124
71034 Boblingen
--------------------------------------------------------------------------------
RECEIVING ENTITY/NAME:  CPOE / Josef Hohenstein
--------------------------------------------------------------------------------
DESTINATION CODE                    B614-4500
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
(p) HP PRODUCT                                                TOTAL WEIGHT (kg)
NO.
-----------------    -----------------    -----------------   ------------------
[Graphic depiction of bar codes]
--------------------------------------------------------------------------------
C2530-84430                                                   283
-----------------    -----------------    -----------------   ------------------

-----------------    -----------------    -----------------   ------------------
(q) QUANTITY:        LOAD UNIT NO:                            SUPPLIER LOT NO.
--------------------------------------------------------------------------------
[Graphic depiction of bar codes
--------------------------------------------------------------------------------
Q6000                T12345878                                987654
-----------------    -----------------    -----------------   ------------------

-----------------    -----------------    -----------------   ------------------
  HP ORDER NO:            SECTION:              ITEM:         COUNTRY OF ORIGIN:
   (9-digits)            (3-digits)          (4-digits)
--------------------------------------------------------------------------------
[Graphic depiction of bar codes]
--------------------------------------------------------------------------------
N820-86975           010                  0100                USA
-----------------    -----------------    -----------------   ------------------
Box 1 of 3
--------------------------------------------------------------------------------
                           OPTIONAL DATA PER BUSINESS

        -----------
Legend:  MUST DATA
        -----------

                                       38
<PAGE>   39

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

 HEWLETT-PACKARD GMBH                    DELIVERY-AND PACKAGING STANDARD
 HEWLETT-PACKARD EUROPE BV

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

3.3.     PRODUCT IDENTIFICATION LABELS
         Each smallest package unit (picking unit) of an article must be labeled
         on the outside and shall contain only parts having the same part number
         belonging to the same order.

--------------------------------------------------------------------------------
 (p) HP PART NO:
---------------------------------- ------------------ --------------------------
 [Graphic depiction of bar codes]
--------------------------------------------------------------------------------
 P9Z80-1250
---------------------------------- ------------------ --------------------------
 DESCRIPTION:  Monitor EX300 VGA
---------------------------------- ------------------ --------------------------
 (q) QUANTITY:                      UNIT MEASURE:      VOLUME (cdm)
---------------------------------- ------------------ --------------------------
 [Graphic depiction of bar codes]
--------------------------------------------------------------------------------
 Q1                                 EACH               180
---------------------------------- ------------------ --------------------------
 COUNTRY OF ORIGIN:                 SUPPLIER LOT NO:   (s) SERIAL NO:  (Range)
---------------------------------- ------------------ --------------------------
 [Graphic depiction of bar codes]
---------------------------------- ------------------ --------------------------
 GERMANY                            T12345678          2323444
--------------------------------------------------------------------------------

                           OPTIONAL DATA PER BUSINESS
        -----------
Legend:  MUST DATA
        -----------

3.4.     CUSTOMS DECLARATION
         For deliveries from Non-EU countries and customs relevant deliveries
         from EU countries an Invoice must be attached with all infos for
         customs declaration (Part number, Oder number, Quantity, Box quantity
         and Box weight, Box number, Currency, Item-value and invoice-value,
         Terms of Delivery, CoO, Terms of payment etc.).
         Customs relevant deliveries must be notified on Boxes and Documents.

3.5.     TRANSPORT DECLARATIONS (DANGEROUS GOODS)
         Dangerous Goods must be notified on Boxes and Documents

                                       39
<PAGE>   40

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

 HEWLETT-PACKARD GMBH                    DELIVERY-AND PACKAGING STANDARD
 HEWLETT-PACKARD EUROPE BV

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

4.       PACKAGING REQUIREMENTS
-------------------------------

4.1.     DELIVERY MODE
         Goods shall be delivered on pallets, if

         --       the volume exceeds 1 m(3)(35 cubic feet)
         --       the weight exceeds 25 kg (66 lbs)
         --       or the consignment consists of more than 5 package units

                  maximum weight per consignment unit:  1000 kg
                  (2200 lbs) incl. load carrier

4.2.     PACKAGES (BOXES)
         Individual packages shall not have a handling weight exceeding 15 kg
         (33 lbs)

4.3.     LOAD CARRIERS (PALLETS)
         All goods shall be delivered on reusable four-way-entry flat pallets
         made of untreated solid wood. Openings for the handling with pallet
         jacks have to be kept open on the small sides (base runners lengthwise
         only).

         Pallets have to be accessible from four sides by regular material
         handling devices. Dimensions must be (unless otherwise specified):
         --       1200 x 100 mm (industry pallets);
         --       1200 x 800 mm Euro pallet
         In exceptional cases 40 x 48 inches.

[Graphic depiction of a load carrier (pallet)]

                                       40
<PAGE>   41

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

 HEWLETT-PACKARD GMBH                    DELIVERY-AND PACKAGING STANDARD
 HEWLETT-PACKARD EUROPE BV

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

4.4      DIMENSIONS
         The goods shall be stacked on the pallet without overhang. A load unit
         shall not exceed an overall height of 1930 mm (76 inches) - including
         pallet. Additional restrictions on height may apply depending on the
         destination, and the purchasing department in question must be
         consulted regarding these restrictions.

4.5.     LOAD UNIT PROTECTION
         Shipment units shall be secured in such a way the good cannot slip or
         the unit loose its integrity. This shall be ensured by the use of
         shrink or stretch wrapping, banding, additional layer sheets,
         interlocked stacking, etc., but shall not hinder the accessibility with
         material handling devices (fork lifts or pallet jack). The products
         shall not be damaged by the LoaD Unit Protection.

4.6.     ENVIRONMENTAL REQUIREMENTS FOR PACKAGING
         GENERAL POINTS
         Packaging should be kept to the minimum amount required to preserve the
         security and hygiene of the packaged products.
         Additionally, any applicable legal norms (see appendix) as well as HP
         specific regulations concerning environment, workplace safety and
         workplace security are to be adhered to. (Refer also to HP's GENERAL
         SPECIFICATION FOR ENVIRONMENT A-5951-1745-1).

         REQUIREMENTS
         --       Low material variety per packaging
         --       Easy separability of the various materials
         --       Avoidance of composite materials
         --       Use of standard and reusable packaging
         --       Material labeling (especially with plastics)
         --       Handling labeling

         --       Recommended packaging materials:
                  Paper, cardboard, corrugated cardboard, untreated wood, iron,
                  aluminum, glass, PE, PP, PS, PET, drying agents: silica gel,
                  active clay

         --       Packaging materials and packaging aids to be avoided:
                  PVC (vinyl), wood chips, compressed fiberboard, wood shavings,
                  straw, loose fill materials, "bio" packaging materials based
                  on plant starch, "popcorn"

         APPENDIX: EXCERPTS OF THE RELEVANT LEGAL NORMS FOR PACKAGING AND
         PACKAGING WASTE
         --       European Waste Guidelines (Europaische Abfallrahmenrichtlinie)
                  75/442/EWG
         --       European Packaging Guidelines (Europaische
                  Verpackungsrichtlnie) 94/62/EG
         --       European Decision 97/129/EG regarding the labeling of
                  packaging material
         --       Industrial Recycling law (Kreislaufwirtschaftsgesetz) and
                  accompanying Waste Law
         --       Transport of Hazardous Waste Law (Gefahrgutbeforderungsgesetz)
                  and accompanying Hazardous Waste Law (Gefahrgutrecht/e.g GGVS)
         --       Packaging Act
         --       Chemical Law (Chemikaliengesetz) and Hazardous Materials Act
                  (Gefahrstoffverordnung) "BGB"
         --       CFC-Halon Prohibition Act (FCKW-Halon-Verbots-Verordnung)

4.7.     TRANSPORT REGULATIONS (DANGEROUS GOODS)

                                       41
<PAGE>   42

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

 HEWLETT-PACKARD GMBH                    DELIVERY-AND PACKAGING STANDARD
 HEWLETT-PACKARD EUROPE BV

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

4.8.     TREATMENT OF INCONSISTENCIES
         In many instances, the packaging is covered by the stipulations of the
         HP product specification. In the event of inconsistencies arising with
         the packaging regulations in the product specification or in existing
         agreements, the supplier shall consult the purchasing department
         concerned.

5.       REVISION CONTROL
-------------------------

--------------------------------------------------------------------------------
   Revision     Changes                            Approved           Date
-------------- ---------------------------------- ------------------ -----------
       D        Completely revised;                Peter Klement      28.04.1999
                English Edition A-5961-3658-1
                German Edition A-5961-3658-2
-------------- ---------------------------------- ------------------ -----------

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

                                       42
<PAGE>   43
     Confidential Materials omitted and filed separately with the Securities
              and Exchange Commission. Asterisks denote omissions.

                          EXHIBIT (F): SERVICE/REPAIR

1. REPAIR STRATEGY:

FULL UNIT REPAIR:

-    Defective units will be shipped from HP GSL (Global Support Logistics) to
     Aspect for repair.
-    Aspect repairs and ships the units within [**] to HP GSL after receipt.
     Each repair unit will be labeled with an internal HP order number and
     tracking number by Aspect. Tracking number and maybe other data must be
     labeled as barcode on the shipment carton by Aspect.

2. Repair Price

Repair consists of [**]

To define for each product:
[**]

Goal for full unit exchange: [**]
Right for Aspect to [**]

To define: [**]

A table detailing the [**] will be defined preliminarily during [**].

3. Handling of Repair Costs:

[**] will pay the then current [**] for any defective unit that is returned to
Aspect. On a regular basis HP will determine the number of units under warranty
that have been replaced/repaired and [**].
Repaired units with "No trouble found" classification Aspect [**] for the
difference between [**] and the following amounts only [**].

                                       43
<PAGE>   44
     Confidential Materials omitted and filed separately with the Securities
              and Exchange Commission. Asterisks denote omissions.

                       EXHIBIT (G): CO-MARKETING PROGRAM

ASPECT/HP JOINT MARKETING PROGRAM - NORTH AMERICA

Both Parties have agreed on the following outline for a joint marketing
program, designed to [**] customers in North America [**] to implementation
of an integrated BIS measurement module on HP Viridia patient monitors.

PROGRAM DETAILS:

Aspect's and HP's sales force in North America will offer the [**] and will
agree [**] for the [**] of the [**] of the [**] at a price of [**] the current
list price for the [**], unless the Parties agree that [**] that the [**] under
this program should be [**]. The current list price for the [**], as outlined
below.

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
                         Qty 1     Qty 2-5    Qty 6-12    Qty 13-19    Qty >20
--------------------------------------------------------------------------------
<S>                      <C>        <C>         <C>          <C>        <C>
List Price $             [**]       [**]        [**]         [**]       [**]
--------------------------------------------------------------------------------
[**]       $             [**]       [**]        [**]         [**]       [**]
--------------------------------------------------------------------------------
</TABLE>

1.   [**] by this program will be purchased at a [**].

2.   Customers taking advantage of this program will be [**] for the [**] (to be
     defined) [**] in North America [**], although customer expectations need to
     be set [**]. There  will be [**] to the customer for this [**], although
     the customer may need to [**] some of his [**] (see below).

3.   Aspect and HP will jointly [**] will provide information on the expected
     cost to the customer of having to [**] in order to be [**] with the [**].

4.   [**] this program and who also purchase [**] under the program, these new
     [**] will be [**] to the appropriate [**] (if necessary) [**].

5.   Both parties will [**] this program for customers who have recently
     purchased the [**].

6.   Aspect will [**] and invoice the customer.

                                       44
<PAGE>   45
     Confidential Materials omitted and filed separately with the Securities
              and Exchange Commission. Asterisks denote omissions.

7.   Aspect will [**] as a result of this program (account details to be
     defined).

8.   Aspect will provide [**] of this program on a [**].

9.   HP will [**] from customers taking advantage of this program. The
     methodology for the calculation and payment of these [**] will be defined
     in the Distribution Agreement between the Parties.

10.  [**] will be responsible for [**] at those sites under the program. Aspect
     will be [**] of the [**].

11.  The timing for implementation of this program will be determined by [**],
     based on their [**] schedule. The current expectation is that this could be
     done once the project has [**], at which point [**] has been defined and
     all risks are understood.

12.  In the event that the [**], for whatever reason, [**] under this program
     [**] the customer for any [**] for the [**] the list prices defined above.

13.  If development of the [**] such that [**] North American [**], both Parties
     [**] by both Parties in good faith, [**] determined by reasons for
     the [**].

14.  In the event that the customer [**] the customer for any [**] made for the
     [**] the list prices defined above.

                                       45
<PAGE>   46

                         EXHIBIT (H): ASPECT TRADEMARKS

                                       46
<PAGE>   47

                         EXHIBIT (H): ASPECT TRADEMARKS

TRADEMARK                  REFERENCE
---------                  ---------

Aspect(R)                  None *
A-2000(TM)                 A-2000 is a trademark of Aspect Medical Systems, Inc.
Bispectral Index(R)        Bispectral is a registered trademark of Aspect
                           Medical Systems, Inc.
BIS(R)                     BIS is a registered trademark of Aspect Medical
                           Systems, Inc. BIS logo is a registered trademark of
                           Aspect Medical Systems, Inc.

[graphic depiction of Aspect's BIS logo]

*   This trademark is registered as a trademark to another company, and is used
    under license by Aspect Medical Systems.

                                       47
<PAGE>   48
     Confidential Materials omitted and filed separately with the Securities
              and Exchange Commission. Asterisks denote omissions.

                               EXHIBIT (I): [**]

[**]

WHEREAS

We, [**], herewith confirm that we have knowledge that Hewlett-Packard GmbH,
Herrenberger Str. 110-140, 71034 Boblingen, Germany ("HP") has granted Aspect
Medical Systems, Inc., 2 Vision Drive, Natick, MA 01760-2059, USA ("Aspect")
[**] under an "OEM Development and Purchase Agreement" (hereinafter referred to
as the "Agreement"), dated August 6th, 1999 and Aspect has certain contingent
obligations to refund portions of such prepayment in accordance with Section 5
(c) of this Agreement.

THEREFORE

We undertake, [**] under the Agreement. We undertake with [**] in accordance
with the Agreement, we shall [**].

[**] of the Agreement [**]. It is understood that the [**] of the Agreement.

                                       48<PAGE>   1
                                                                    Exhibit 10.8

                          Aspect Medical Systems, Inc.
has requested that the market portions of this agreement be granted confidential
  treatment pursuant to Rule 406 under the Securities Act of 1933, as amended.

HEWLETT-PACKARD GMBH
Medical Products Group
Herrenberger Strasse 110 - 140
D-71034 Boeblingen
Germany

August 27, 1999

Mr J. Breckenridge Eagle
Chairman
Aspect Medical Systems, Inc.
2 Vision Drive
Natick, MA 01760-2059
USA

Dear Breck,

As we discussed on Friday, the following is confirmation of our willingness to
allow Aspect to set the expectation that customers purchasing the stand-alone
A2000 monitor in North America will be able to purchase an exchange to the HP
BIS module solution, once it becomes available, at an incremental price of [**].
This interim program is designed to bridge-the-gap until such time that Aspect
and HP are able to announce and implement the joint co-marketing program, as
defined under our overall agreement. The following conditions need to apply:

1.   Orders for this exchange will only be taken once the module is released in
     North America;

2.   Customers need to be made aware that there may be some additional costs for
     upgrading their existing Viridia CMS and Viridia 24/26 monitors in order to
     be compatible with the BIS module;

3.   Customers ordering this exchange will do so directly from Aspect and Aspect
     will be responsible for delivering and installing the modules at the
     customer's site (some basic "knobology" training will need to be provided
     to the Aspect salesforce by HP's North American operation);

4.   Aspect will supply HP with a complete list of all customers (name, address
     and date of installation) who take advantage of this exchange;

5.   These exchange modules can only be offered to customers who purchased an
     A2000 monitor between the effective date of our agreement and the
     introduction of the joint co-marketing agreement in North America (a copy
     of the customer's original purchase order will be required at the time of
     ordering the modules);

6.   HP will supply Aspect with up to a maximum of [**] BIS module systems for
     this purpose, at a price of [**] each (assumes that all customer ordering,
     delivery and installation is performed by Aspect, as outlined above).
     Warranty and after-sales servicing responsibility will remain with HP;

7.   Aspect will offer HP the special transfer price of [**] for the HP BIS
     module kits required to cover module systems sold as part of this program.

I think you'll agree that this compromise solution will help to allay any risk
of a customer postponing his decision to purchase BIS technology.

With best regards

/s/ Steve Bebb
--------------------------
Steve Bebb
Market Development Manager

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