Document:

EXHIBIT 10.5

                                 EAST PENN BANK
                           DIVIDEND REINVESTMENT PLAN

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                               EXPLANATION OF THE
                  DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN

      The following, in a question and answer format, constitutes a summary
description of the East Penn Dividend Reinvestment and Stock Purchase Plan. A
complete copy of the Plan follows. Those holders of East Penn's common stock who
do not participate in the plan will continue to receive stock certificates, if
and when stock dividends or stock splits are declared.

General

1.    What is the purpose of the plan?

      The plan provides participants of East Penn's common stock with a
convenient method of investing cash dividends payable upon their common stock
and of making voluntary cash payments to purchase additional shares of common
stock. To the extent that the additional shares are purchased directly from East
Penn under the plan, East Penn will receive additional funds for its general
corporate purposes. (See the Section entitled "USE OF PROCEEDS".) Each
participant should recognize that neither East Penn nor the plan administrator
(See No. 3 below) can provide any assurance that shares purchased under the plan
will, at any particular time, be worth more or less than their purchase price.

2.    What are the advantages of the plan?

      o     The plan provides participant shareholders with the opportunity to
            make additional voluntary cash payments, within specified limits, to
            purchase additional shares of common stock, without the payment of
            any service charges or brokerage commissions.

      o     Participants will obtain full investment use of funds, because the
            plan provides for fractional shares as well as whole shares to be
            credited to the participants' accounts. Fractional shares earn
            dividends just like whole shares when held in the plan account. (See
            No. 12 below.)

      o     Participants may avoid cumbersome safekeeping and recordkeeping
            costs through the free custodial and reporting services furnished by
            the plan. Shares are held in "book entry" form and regular
            statements of account are provided by the plan administrator. (See
            Nos. 17, 18 and 24 below.)

      o     Participants benefit because East Penn pays all of the
            administrative costs of the plan. (See No. 16 below.)

3.    Who administers the plan for participants?

      Registrar and Transfer Company administers the plan. In this capacity, the
plan administrator sends periodic statements of account to participants and
performs other administrative duties relating to the plan. Shares purchased for
a participant under the plan are

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held by the plan administrator and registered in its name. (See No. 18 below.)

      Any notices, questions or other communications relating to the plan should
include the participant's account number and tax identification number and
should be addressed to:

                         Registrar and Transfer Company
                         Attn: Dividend Reinvestment Department
                         10 Commerce Drive
                         Cranford, NJ 07016

      Participants who have questions regarding the plan also may contact the
plan administrator at 1-800-368-5948.

Participation

4.    Who is eligible to participate in the plan?

      Generally, record holders of common stock of East Penn are eligible to
participate in the plan. However, East Penn may refuse to offer the plan to
various shareholders of East Penn as follows:

      o     those who are residents of a state that may require registration,
            qualification or exemption of the common stock to be issued under
            the plan, or registration or qualification of East Penn or any of
            its officers or employees as a broker, dealer, salesman or agent
            where the plan administrator determines, in its discretion, that the
            number of shareholders or number of shares held does not justify the
            expense of registration, fees, etc. in that state(s);

      o     those whose shares are registered in the name of a nominee, such as
            a brokerage firm or securities depository, unless those shares are
            first transferred into the record name of the beneficial owner; and

      o     those shareholders who beneficially own 5% or more of East Penn's
            outstanding common stock, as determined by the plan administrator,
            in its sole discretion.

      Subject to the limitations in the paragraph immediately above and without
limiting the generality of this statement, participants in the plan may make
voluntary cash payments of not less than $100.00 or more than $2,500.00 per
quarter. (See No. 14 below.)

5.    How does an eligible shareholder become a participant in the plan?

      An eligible shareholder may join the plan at any time by completing and
signing the authorization form included with the Offering Circular and returning
it to the plan administrator. A postage-paid envelope is provided, with the
Offering Circular, for that purpose. Additional authorization forms may be
obtained, at any time, from the plan administrator. A properly completed
authorization form must be received at least 10 business days before a dividend
record date in order for the dividends payable to shareholders of record on that
date to be reinvested in

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East Penn's common stock under the plan.

      Historically, dividends declared on the common stock have been declared
and paid on a quarterly basis. East Penn's Board of Directors reserves the right
to change dividend record and payment dates, if and when dividends are declared.

6.    Is a shareholder required to reinvest his or her dividends on all shares
      of common stock held in the plan in order to participate in the plan?

      Yes. All holders of record of East Penn's common stock are eligible to
participate in the plan, except as discussed in No. 4 above. To participate in
the plan, however, record holders of common stock must participate with respect
to all shares of common stock that they hold in the plan and must arrange to
have the dividends on all of those shares reinvested under the plan by
completing the authorization form and sending the form to the plan
administrator.

7.    May a participant change the number of shares subject to the plan so as to
      reduce the number of shares subject to dividend reinvestment to some
      number representing less than all shares held?

      No. Shareholders may only participate in the plan with respect to all of
their shares of common stock held in the plan.

Purchases

8.    How are shares of common stock acquired under the plan?

      Cash dividends payable on East Penn's common stock held by persons
participating in the plan will be paid to the plan administrator. The cash
dividends paid to the plan administrator will not include any applicable taxes
withheld by East Penn. The plan administrator will pool these cash dividends
together with all voluntary cash payments received and, with respect to shares
to be purchased on the open market, will transfer them to an independent
purchasing agent, who will be a broker-dealer registered under the Securities
Exchange Act of 1934 and may be a bank, trust company, brokerage firm, or other
independent fiduciary, as selected by the plan administrator. Aside from
transferring funds to the plan purchasing agent, neither East Penn nor the plan
administrator shall have any influence on the manner, methods, or timing of
shares acquired in open market transactions. The plan purchasing agent will use
the funds to purchase shares of East Penn's common stock on the open market for
the plan accounts of the participants. Alternatively, the plan administrator
will, if so directed by East Penn, acquire shares directly from East Penn, or
pursuant to negotiated transactions. A combination of the foregoing methods may
be used, as East Penn directs. In any event, each participant's account will be
credited with a pro rata share of the purchased shares.

9.    When will shares of common stock be purchased under the plan?

      All dividends (cash and stock) will be used to purchase common stock as
soon as reasonably possible after the applicable dividend payment date, but not
more than 30 days after the dividend payment date.

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      Voluntary cash payments will be accepted for investment, and will be
invested, only in connection with a dividend payment date. Because participants
will not be credited with interest on their voluntary cash payments prior to
investment and because the plan administrator is prohibited from holding
voluntary cash payments for extended periods of time prior to investing them,
participants are strongly encouraged to submit their voluntary cash payments as
near as possible to the applicable dividend payment date. For investment of a
voluntary cash payment to occur on a particular investment date, the voluntary
cash payment must be received by the plan administrator no later than 10 days
prior to the corresponding dividend payment date, allowing adequate time for the
checks or other drafts to clear prior to the corresponding dividend payment
date.

      Purchases of common stock in the open market or in negotiated transactions
may occur over one or more trading days.

10.   At what price will shares of common stock be purchased under the plan?

      For purchases of shares of common stock in the open market, or in
negotiated transactions, the purchase price will be the fair market value of the
common stock as of the investment date. The investment date is defined in the
plan as the day during a month on which a dividend is payable, and in any other
month, the 15th day of that month, or in any case, if that day is not a business
day on which securities are traded, then the next following business day on
which securities are traded. The purchase price of the common stock purchased
under the plan in open market and/or in negotiated transactions will be the
participant's pro rata share of the actual costs (excluding brokerage
commissions, if any) incurred by the plan administrator for those purchases. For
shares of common stock purchased from East Penn, the purchase price will be the
fair market value of the common stock, as of the applicable investment date. In
the event of purchases of common stock from East Penn and in the open market
and/or negotiated transactions, the purchase price per share of common stock to
be charged to each participant will be based on the weighted averages of the
prices of all shares purchased. Each participant's account will be credited with
the number of whole and fractional shares calculated to 5 decimal places, equal
to the amount to be invested for the participant divided by the applicable
purchase price.

      If the common stock is listed on an established organized stock exchange,
the fair market value will be the closing price per share for the common stock
on that stock exchange on the applicable date or, if no sale of the common stock
occurred on that stock exchange on that date, the closing price per share for
the common stock on that exchange on the next day on which a sale of common
stock occurred. If the common stock is not listed on an established exchange but
is listed in the National Market System of the National Association of
Securities Dealers Automated Quotation System (NASDAQ/NMS), the fair market
value will be the average of the highest and lowest trading prices per share for
the common stock on the applicable date or, if no trade of the common stock
occurred in the National Market System on that date, the average of the highest
and lowest trading prices per share for the common stock on the next day on
which the common stock was traded in the National Market System. If the common
stock is not listed on an established stock exchange or in the NASDAQ/NMS but is
quoted on a system maintained by the National Association of Securities Dealers,
Inc. (NASD), the fair market value will be the

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average of the closing dealer bid and asked prices per share for the common
stock quoted on that system on the applicable date or, if no bid and asked
prices are quoted on that system on that date, the average of the closing dealer
bid and asked prices for the common stock quoted on that system on the most
recent previous day on which prices were so quoted. If the common stock is not
listed on an established stock exchange or in the NASDAQ/NMS, or quoted in a
system maintained by the NASD, the fair market value will be the average of the
lowest bid and highest asked prices per share for the common stock quoted on the
applicable date by one or more brokerage firms selected by the plan
administrator which then make a market in the common stock or, in the absence of
any bid and asked prices quoted on that date, the quoted per share price (or
average of the quoted per share prices, if several), whether bid or asked, for
the common stock reported on that date or, failing this, on the most recent
previous date on which quotes are available.

11.   How many shares of common stock will be purchased for participants?

      The number of shares purchased for each participant will depend on the
amount of dividends to be reinvested in a participant's account, the amount of
any voluntary cash payments and the applicable purchase price of the common
stock (See No. 10 above). Each participant's account will be credited with that
number of shares, including any fractional interest computed to 5 decimal
places, equal to the total amount to be invested divided by the applicable
purchase price as described in No. 10 above.

12.   Will dividends on shares held in a participant's account be used to
      purchase additional shares under the plan?

      Yes. If and when East Penn declares cash and/or stock dividends or stock
splits, to the record holders of shares of its common stock, the plan
administrator will credit each participant's account with those dividends and/or
stock splits, and all dividends and/or stock splits will be automatically
reinvested in additional shares of common stock, thereby compounding each
participant's investment. Fractional shares held under the plan for a
participant's account will receive dividends in the same way as a whole share,
but in proportion to the size of the fractional share.

Voluntary Cash Payments

13.   Who is eligible to make voluntary cash payments?

      All record holders of common stock who elect to have dividends reinvested
and who are eligible to participate, in accordance with the provisions of the
plan, may also elect to make voluntary cash payments.

14.   What are the limitations on voluntary cash payments?

      Participants are strongly encouraged to submit any voluntary cash payments
as near as possible to the applicable dividend payment date (See No. 9 above).
No interest will be paid on optional cash payments pending investment. Voluntary
payments received too early or too late will be returned to participants.

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      Voluntary cash payments may not be less than $100.00 or more than
$2,500.00 per quarter. East Penn reserves the right, in its sole discretion, to
determine whether voluntary cash payments are made on behalf of an eligible
participant.

15.   How does the voluntary cash payment option work?

      A voluntary cash payment may be made by enclosing a check or money order
with the executed authorization form (for new participants) or by forwarding a
check or money order to the plan administrator with a payment form that will
accompany each statement of account. Checks and money orders should be made
payable to ["Registrar and Transfer Company"] and should include the
participant's account number and taxpayer identification number. Additional
payment forms may be obtained from the plan administrator.

      Any voluntary cash payment received by the plan administrator within the
period, described in Nos. 9 and 14 above, will be applied to the purchase of
shares of common stock on the following investment date at a price determined in
accordance with the provisions of the plan. No interest will be paid on
voluntary cash payments held by the plan administrator prior to the respective
investment date.

Costs

16.   Are there any expenses to participants in connection with purchases under
      the plan?

      No. Participants are not obligated to pay any brokerage commissions or
other charges with respect to purchases of common stock under the plan.

      A participant who requests that the plan administrator sell shares of
common stock held in the participant's account in the plan incurs a $10.00
service fee, and any brokerage fees incurred in connection with the sale. If a
participant pays the fee in advance when notice of sale is made, then the fee
will not be deducted from the proceeds of the sale (See Nos. 20 and 22 below).

Reports to Participants

17.   What kind of reports are sent to participants in the plan?

      The plan administrator maintains a separate account for each participant.
Each participant in the plan receives a statement of account subsequent to each
dividend payment date describing cash dividends, stock dividends, stock splits,
the number of shares purchased, the amount of voluntary cash payments made by
the participant, the price per share, and total shares accumulated under the
plan. These statements provide a continuing record of the dates and costs of
purchases on a quarterly basis and should be retained for income tax purposes.
In addition, participants receive East Penn's annual and quarterly reports to
shareholders, notices of shareholder meetings, proxy statements, and Internal
Revenue Service information for reporting dividends paid and commission expenses
paid on their behalf.

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Certificates for Shares

18.   Will certificates be issued for shares of common stock purchased or
      acquired under the plan?

      No. The custodial, or "book entry" method of holding shares is a
safekeeping feature that protects against loss, theft, or destruction of stock
certificates. It is also a more economical way for the plan administrator to
administer the plan. Certificates for shares purchased or acquired pursuant to a
stock dividend or stock split for a participant's account under the plan will
not be issued unless the participant:

      o     specifically requests in writing that the certificates be issued and
            includes the payment of a service fee of $10.00 to the plan
            administrator;

      o     withdraws shares from his or her plan account and requests that the
            shares be sold on his or her behalf; or

      o     terminates participation in the plan and does not request the shares
            to be sold on his or her behalf. A $10.00 fee is payable by
            participants upon withdrawal or termination from the plan. If the
            fee is not paid in advance when the withdrawal or termination is
            requested, the fee will be deducted from the participant's account.

Withdrawal of Shares in Plan Accounts

19.   How may a participant withdraw shares purchased under the plan?

      A participant may withdraw from participation in the plan all of the whole
shares of common stock credited to his or her account by submitting written
notification to the plan administrator at the address shown in No. 3 above.
Whole shares of common stock withdrawn from the plan will be issued through a
certificate in the name of the participant and dividends will no longer be
reinvested. Any notice of withdrawal received from a participant less than 10
business days before a dividend record date will not be effective until the
participant's dividends paid on that date have been reinvested and the shares
credited to the participant's account. There is a $10.00 withdrawal fee payable
by the participant. Any fractional interest withdrawn will be liquidated by the
plan administrator on the basis of the then current fair market value of the
common stock and a check issued for the proceeds thereof. In no case will
certificates representing a fractional interest be issued. If the participant
withdraws a portion of his or her shares held in the plan and does not sell the
withdrawn shares, the participant will be deemed to have terminated his or her
participation in the plan because a shareholder may only participate in the plan
with respect to all of his or her shares of common stock and not a portion of
those shares.

20.   May a participant elect to have the withdrawn shares sold?

      Yes. Participants may request the plan administrator to sell the shares
withdrawn from the plan. The request to sell received from a participant less
than 10 business days before a

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dividend record date will not be effective until the participant's dividends
paid on that date have been reinvested and the shares credited to the
participant's account. Participants should specify in their written notification
of withdrawal if the plan administrator is to cause the sale of the withdrawn
shares.

      The plan administrator will direct the plan purchasing agent to execute a
sale order providing for the sale of shares, within 30 days of receipt of the
notice, and to deliver to the participant a check for the proceeds of the sale,
less: any brokerage commissions; a $10.00 service fee; applicable withholding
taxes; and transfer taxes (if any) incurred in connection with the sale. A
request for shares to be sold must be signed by all persons in whose names the
account appears, with signatures guaranteed.

      Any fractional interest withdrawn will be liquidated by the plan
administrator on the basis of the then current market value of the common stock
and a check issued for the proceeds thereof. In no case will certificates
representing a fractional interest be issued.

      Participants who withdraw all of the whole and fractional shares from
their accounts will be treated as having terminated participation in the plan
and will also incur a $10.00 withdrawal fee in addition to the $10.00 service
fee to execute a sale order. (See No. 22 below.)

Discontinuation of Dividend Reinvestment

21.   How does a participant discontinue participation under the plan?

      Participants may terminate their participation in the plan at any time by
sending written notice to the plan administrator. When a participant terminates
his or her participation in the plan, the plan administrator will deliver to the
participant a certificate for whole shares credited to the participant's account
under the plan, and a check representing:

      o     any uninvested dividends held by the plan administrator for the
            participant under the plan, and;

      o     the value of any fractional share based on the then current fair
            market value per share of East Penn's common stock. Any notice of
            termination received less than 10 business days prior to a dividend
            record date will not be effective until dividends paid for the
            record date have been reinvested and the shares (whole or
            fractional) credited to the participant's account. There is a $10.00
            withdrawal fee to terminate participation in the plan.

22.   May a participant request shares to be sold when terminating
      participation?

      Yes. The request should be in writing for all of the whole shares to be
sold. Any request must be signed by each person in whose name the plan account
appears. On receipt of the request, the plan administrator will direct the plan
purchasing agent to proceed in the same manner as set forth in No. 20 above. A
check will be issued in lieu of the issuance of any fractional share based on
the then current fair market value per share of East Penn's common stock. There
is a $10.00 service fee for any participant who requests the plan administrator
to

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sell the shares held in the participant's account. In addition, there is a
$10.00 withdrawal fee to terminate participation in the plan. Therefore, any
participant who elects to terminate his or her participation in the plan and
directs the plan administrator to sell the shares held in his or her account
will incur, in the aggregate, a service fee of $20.00, representing the $10.00
withdrawal fee and the $10.00 service fee in connection with the sale of the
shares, plus any broker commissions, if applicable.

Federal Income Tax Information

23.   What are the federal income tax consequences of participation in the plan?

      For federal income tax purposes, a participant in the plan will be treated
as having received, on the dividend payment date, the full amount of dividends
allocable to the participant, regardless of whether the dividends are actually
paid in cash, withheld for the payment of taxes, or invested in additional
shares of common stock pursuant to the plan. Additionally, the participant will
be deemed to have received taxable income in the amount of commissions and other
brokerage expenses paid in purchasing shares on the participant's behalf. The
per share tax basis of shares acquired for a participant under the plan will be
the price per share reported on the periodic statement of account supplied to
each participant after each applicable investment date, adjusted to include the
amount of commissions and other brokerage expenses paid on behalf of the
participant, as reported in the Internal Revenue Service information referred to
in No. 17 above.

      The holding period for shares acquired pursuant to the plan will begin on
the day after the date the shares are acquired for a participant's account. When
a participant is subject to federal income tax withholding on dividends, and
when foreign participants' taxable income under the plan is subject to federal
income tax withholding, dividends will be reinvested net of the amount of tax
withheld under applicable law.

      East Penn believes that participants will not realize any taxable income
upon receipt of certificates for whole shares credited to their account, either
upon the withdrawal of shares from the plan or upon termination of participation
in the plan. A participant who sells or exchanges shares previously received
from the plan, or who directs the plan administrator to sell his or her plan
shares, may, however, recognize gain or loss. A participant will also likely be
required to recognize gain or loss upon the receipt of a cash payment for a
fractional share credited to the participant's account upon withdrawal of shares
from the plan. The amount of gain or loss in either case will be the difference
between the amount the participant receives for the plan shares or fractional
share and the participant's tax basis in those shares or fractional share.

      Participants who purchase common stock under the plan with voluntary cash
payments should not be required to recognize income in connection with those
purchases. The tax basis of shares purchased under these circumstances will be
equal to the purchase price as adjusted for the amount of commission expenses
paid on behalf of the participants. The holding period for those shares will
commence on the day after the shares are acquired.

      Dividends reinvested under the plan by corporate shareholders may be
eligible for the dividends-received deduction.

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      The foregoing summary is based upon an interpretation of current federal
income tax laws, and assumes that dividends paid by East Penn will be from its
earnings and profits. Participants should consult their own tax advisors to
determine particular tax consequences, including state tax consequences, which
may result from participation in the plan, and any subsequent disposal of shares
acquired pursuant to the plan.

Other Information

24.   What happens if East Penn declares a stock dividend or a stock split?

      The common stock in a participant's account will be adjusted to give
effect to the stock dividend or stock split. In that event, the number of shares
available for issuance under the plan shall likewise be adjusted. Participants
will not receive certificates for their plan shares unless requested. This
protects against loss, theft or destruction of stock certificates and reduces
East Penn's administrative costs associated with the plan.

25.   How will the shares credited to a participant's account be voted at a
      meeting of shareholders?

      Participants will receive a proxy that will enable them to vote whole
shares and fractional interests registered in their name and will enable them to
direct the plan administrator how to vote whole shares and fractional interests
credited to their plan account. Shares held by the plan administrator for the
account of a participant who does not properly return a proxy will not be voted.
Participants will vote shares registered in their own names directly, or by
proxy, as they have in the past.

26.   What are the responsibilities and liabilities of East Penn and the plan
      administrator?

      East Penn and the plan administrator shall not be liable for any act taken
in good faith or for any good faith omission to act, including without
limitation, any claims of liability:

      o     arising out of failure to terminate a participant's account upon his
            or her death;

      o     with respect to the prices at which shares of East Penn's common
            stock are purchased or sold, the times when or the manner in which
            those purchases or sales are made, the decision whether to purchase
            shares of common stock on the open market or from East Penn,
            fluctuations in the market value of the common stock; and

      o     any matters relating to the operation or management of the plan.

      All transactions in connection with the plan will be governed by the laws
of the Commonwealth of Pennsylvania.

27.   May the plan be modified or discontinued?

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      Yes. The Board of Directors of East Penn, in its discretion, may modify,
suspend, or terminate the plan at any time and will endeavor to promptly notify
participants of any suspension, termination, or modification. The Board of
Directors of East Penn may terminate, for whatever reason, at any time, as it
may determine, in its sole discretion, a participant's participation in the
plan, after mailing a notice of intention to terminate to the participant at the
address as it appears on the plan administrator's records.

28.   May participants pledge shares held in their account under the plan?

      No. Shares credited to a participant's account under the plan may not be
pledged or assigned, nor may any rights or interests under the plan be
transferred, pledged or assigned, and any purported pledge, assignment or
transfer shall be void. Participants who wish to pledge or assign their shares
held under the plan must withdraw those shares from the plan which will
terminate their participation in the plan.

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                                 EAST PENN BANK
                  DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN

1.    PURPOSE

      The purpose of this Dividend Reinvestment and Stock Purchase Plan is to
provide the holders of record of the Common Stock, par value $0.625 per share,
of East Penn Bank with a convenient method to invest cash and stock dividends
payable with respect to the Common Stock and to make voluntary cash payments for
the purchase of additional shares of Common Stock, and to provide for
safekeeping of stock certificates when shares are distributable to plan
participants, all as hereinafter provided.

2.    DEFINITIONS

      For purposes of this plan:

      (a) "Account" shall mean the account held by the plan administrator for a
participant to which his or her plan shares are credited.

      (b) "Authorization Form" shall mean the form or other document, as
prescribed by the plan administrator and as amended from time to time, used to
evidence an election by an eligible shareholder of the Bank to participate in
the plan.

      (c) "Common Stock" shall mean the Common Stock of the Bank, having a par
value of $0.625 per share.

      (d) "Bank" shall mean East Penn Bank.

      (e) "Dividend" shall mean a dividend payable by the Bank in cash or shares
with respect to the Common Stock.

      (f) "Fair Market Value" shall mean the value of a share of Common Stock as
of the applicable date as determined by the plan administrator as follows:

            (i) If the Common Stock is listed on an established organized stock
      exchange, the fair market value shall be the closing price per share for
      the Common Stock on such stock exchange on the applicable date or, if no
      sale of the Common Stock occurred on such stock exchange on that date, the
      closing price per share for the Common Stock on such stock exchange on the
      next day on which a sale of Common Stock occurred.

            (ii) If the Common Stock is not listed on an established stock
      exchange but is listed in the National Market System of the National
      Association of Securities Dealers Automated Quotation System
      ("NASDAQ/NMS"), the fair market value shall be the average of the highest
      and lowest trading prices per share for the Common Stock on the applicable
      date or, if no trade of the Common Stock occurred in said National Market
      System on that date, the average of the highest and lowest trading prices
      per share for the Common Stock on the next day on which the Common Stock
      was traded in said National

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      Market System.

            (iii) If the Common Stock is not listed on an established stock
      exchange or in the NASDAQ/NMS but is quoted on a system maintained by the
      National Association of Securities Dealers, Inc. ("NASD"), the Fair Market
      Value shall be the average of the closing dealer bid and asked prices per
      share for the Common Stock quoted on such system on the applicable date
      or, if no such bid and asked prices are quoted on such system on that
      date, the average of the closing dealer bid and asked prices per share for
      the Common Stock quoted on such system on the most recent previous day on
      which such prices were quoted.

            (iv) if the Common Stock is not listed on an established stock
      exchange or in the NASDAQ/NMS, or quoted on a system maintained by the
      NASD, the fair market value shall be the average of the lowest bid and
      highest asked prices per share for the Common Stock quoted on the
      applicable date by one or more brokerage firms selected by the plan
      administrator which then make a market in the Common Stock or, in the
      absence of any such bid and asked prices quoted on such date, the quoted
      per share price (or average of the quoted per share prices, if several),
      whether bid or asked, for the Common Stock reported on the applicable date
      or, failing this, on the most recent previous date on which such quotes
      are available.

      (g) "Investment Date" shall mean the day during a month on which a
Dividend is payable, and in any other month, the fifteenth (15th) day of such
month, or if in any case, such day is not a business day on which securities are
traded, then the next following business day on which securities are traded.

      (h) "Participant" shall mean a shareholder of record of the Bank who is
participating in the plan.

      (i) "Plan" shall mean this Dividend Reinvestment and Stock Purchase Plan,
as amended from time to time.

      (j) "Plan Administrator" shall mean such administrator as the Board of
Directors of the Bank may, in its sole discretion, from time to time, select.

      (k) "Plan Purchasing Agent" shall mean an entity registered as a broker
dealer under the Securities Exchange Act of 1934, as amended, which entity may
be a bank, trust company, brokerage firm or other independent fiduciary
institution selected by the plan administrator for purposes of purchasing
shares, in the open market, on behalf of the plan. The Board of Directors of the
Bank reserves the right to select a new plan purchasing agent at any time.

      (l) "Plan Shares" shall mean the shares of Common Stock, whole and
fractional, that are held by the plan administrator for the benefit of the
participants under the plan.

3.    ADMINISTRATION

      The plan administrator shall administer the plan. All plan shares will be
registered in the name of the plan administrator, or its nominee, as agent for
the participants and will be credited

<PAGE>

to the respective accounts of the participants.

4.    PARTICIPATION

      All holders of record of Common Stock are and shall be, and all
participants shall be eligible to participate in the plan, except as otherwise
determined, from time to time, by the Bank. Without limiting the foregoing, the
Bank may refuse to offer the plan to shareholders residing in any state that
requires (i) the registration or qualification of the Common Stock to be issued
pursuant to the plan, or exempt therefrom, or (ii) the registration or
qualification of the Bank or the plan administrator, or any of their respective
officers or employees, as a broker, dealer, salesman or agent. Beneficial owners
of shares of Common Stock whose shares are registered in names other than their
own (for instance, in the name of a broker or nominee) may become shareholders
of record by requesting their broker or nominee to transfer such shares into
their own name or to request that the broker or nominee enroll in the Plan on
their behalf. Also, persons who beneficially own five percent (5%) or more of
the Common Stock are prohibited from enrolling in the plan unless so permitted
by majority vote of the Bank=s full Board of Directors. Participants who become
beneficial owners of five percent (5%) or more of the Common Stock, as
determined by the Bank, in its sole discretion, will be terminated from further
participation in the plan upon achieving such ownership status. For purposes of
the Plan, "Beneficial Ownership" shall be determined in accordance with the
definitions of "beneficial ownership" set forth in the General Rules and
Regulations of the Securities and Exchange Commission, as interpreted and
administered by the Board of Governors of the Federal Reserve System and may
include securities owned by or for the individual's spouse and minor children
and any other relative who has the same home, as well as securities to which the
individual has or shares voting or investment power, or has the right to acquire
beneficial ownership within 60 days of the proposed transaction. Beneficial
ownership may be disclaimed as to certain of the securities.

5.    ENROLLMENT

      Any eligible shareholder of record of the Bank may enroll in the plan at
any time by completing and signing an authorization form and returning it to the
plan administrator. If an authorization form requesting reinvestment of
dividends is received by the plan administrator at least five (5) business days
before the record date established for a particular dividend, reinvestment will
commence with that dividend. If an authorization form is received from a
shareholder less than five (5) business days before the record date established
for that particular dividend, the reinvestment of dividends will begin with the
payment of dividends following the next dividend record date if at that time the
shareholder is still a record holder of Common Stock.

      A record holder of Common Stock may participate in the plan only with
respect to all of his or her Common Stock held in the plan, and may not
participate in the plan with respect to less than all of his or her shares of
Common Stock, held by the participant of record in his or her plan account.

6.    VOLUNTARY CASH PAYMENTS

      Any eligible shareholder of record who is enrolled in the plan and who is
eligible to

<PAGE>

participate in accordance with the provisions of the plan may also elect to make
voluntary cash payments by enclosing a check or money order with the executed
authorization form (for new participants) or by forwarding a check or money
order to the plan administrator with a payment form that will accompany each
statement of account. Checks and money orders shall be made payable to
"Registrar and Transfer Company", and should include the participant's account
number and taxpayer identification number. The amount of such voluntary cash
payments may not be less than fifty dollars ($50.00) or total more than five
thousand dollars ($5,000.00) per quarter. The Bank reserves the right, in its
sole discretion, to determine whether voluntary cash payments are made on behalf
of an eligible participant. Voluntary cash payments will be accepted for
investment, and will be invested, only in connection with the end of a calendar
quarter. For purposes of the plan, the Bank's calendar quarters end on the last
business day of March, June, September, and December. Because participants will
not be credited with interest on their voluntary cash payments prior to
investment and because the plan administrator is prohibited from holding such
voluntary cash payments for extended periods of time prior to investing them,
participants must submit their voluntary cash payments as near as possible to
the end of the respective calendar quarter, but at least five (5) days prior to
such date. For investment of a voluntary cash payment to occur on a particular
investment date, the voluntary cash payment must be received by the plan
administrator no later than five (5) days prior to the corresponding end of the
calendar quarter, allowing adequate time for the checks or other drafts to clear
prior to the corresponding dividend payment date.

7.    PURCHASES

      On each date that dividends are payable, the Bank will pay to the plan
administrator the dividends payable with respect to the Common Stock of the
participants, including their plan shares, less any applicable withholding
taxes. As of each investment date, the plan administrator will use the amount of
the available dividends so received from the Bank, together with voluntary cash
payments received from Participants, to purchase Common Stock for the accounts
of the participants. The plan administrator shall either: (i) purchase Common
Stock from the Bank; (ii) direct the plan purchasing agent to purchase the
Common Stock in the open market; (iii) arrange for the purchase of Common Stock
in negotiated transactions; or (iv) employ a combination of the foregoing, as
directed from time to time by the Bank. Common Stock purchased from the Bank
will be its authorized but unissued shares of Common Stock or issued, but not
outstanding, shares of Common Stock.

      Purchases of Common Stock from the Bank under the plan shall be made as
soon as reasonably possible after the investment date, but not more than thirty
(30) days after such date. Open market purchases of Common Stock under the plan
will be made by the plan purchasing agent on or as soon as reasonably possible
after each investment date, but not more than thirty (30) days after such date.
Neither the Bank nor the plan administrator will exercise discretion or control
over the methods or timing of purchases made by the plan purchasing agent
pursuant to the plan. If any Common Stock is purchased in the open market and/or
in negotiated transactions, no Common Stock will be allocated to a participant's
account until all Common Stock has been purchased for all participants that
month, whether from the Bank, in the open market, or in negotiated transactions.

      The purchase price of Common Stock purchased from the Bank under the plan
shall be

<PAGE>

the fair market value of the Common Stock as of the investment date. The
purchase price of Common Stock purchased under the plan in the open market
and/or in negotiated transactions will be the participant's pro rata share of
the actual costs, excluding any brokerage commissions, incurred by the plan
administrator for such purchases. In the event of purchases of Common Stock from
the Bank and in the open market and/or in negotiated transactions, the purchase
price per share of Common Stock to be charged to each participant will be based
upon the weighted averages of the prices of all shares purchased. Each
participant's account will be credited with the number of whole and fractional
shares of Common Stock, calculated to four (4) decimal places, equal to the
amount to be invested for the participant divided by the applicable purchase
price.

8.    DIVIDENDS ON PLAN SHARES

      As the record holder of the plan shares held in participants' accounts
under the plan, the plan administrator will receive dividends, less any
applicable withholding taxes, payable with respect to all plan shares held on
each dividend record date, will credit such dividends to participants' accounts
on the basis of the plan shares held in each account, and will reinvest such
dividends in Common Stock under the plan.

9.    COSTS

      The Bank will pay all costs of administration of the plan and service
charges except as otherwise provided. No brokerage fees will be charged to
participants in connection with the purchase of Common Stock. Participants will
be charged the full actual cost, including any brokerage commissions, of all
shares of Common Stock sold on their behalf pursuant to the plan. A participant
who requests that the plan administrator sell shares of Common Stock held in the
participant's account in the plan will incur a $15.00 service fee, in addition
to any brokerage fees incurred in connection with such sale. If the fee is paid
in advance when notice of sale is made, then the fee will not be deducted from
the proceeds of the sale. A $10.00 service fee will be charged to participants
who request that the share certificates be issued to them in lieu of their plan
shares being held in book entry form. If such fee is not paid in advance when
the withdrawal or termination is requested, the fee will be deducted from the
participant's account.

10.   REPORTS TO PARTICIPANTS

      As soon as practicable after each Investment date, the plan administrator
will mail to each participant for whose account a transaction has occurred under
the plan, a statement showing:

      (a)   the amount of dividends applied for the participant toward such
            investment;

      (b)   any taxes withheld;

      (c)   the net amount invested;

      (d)   the number of plan shares purchased;

<PAGE>

      (e)   the price per share at which plan shares were purchased; and

      (f)   the total plan shares accumulated in the participant's account.

      Each participant will receive annually, information for the purpose of
reporting his or her dividend income and other relevant information, including
brokerage commissions and other expenses paid on the participant's behalf, in
accordance with applicable tax laws.

11.   VOTING OF PLAN SHARES

      The whole number of shares of Common Stock credited to the account of a
participant under the plan will be voted at meetings of shareholders of the Bank
by the plan administrator, as record holder, in accordance with the instructions
of the participant, as delivered by the participant, as and when prescribed by
the Bank or the plan administrator. In the absence of providing such
instructions to the plan administrator, the plan shares of a participant will
not be voted.

12.   WITHDRAWAL OF PLAN SHARES

      Participants may withdraw all or a portion of the whole plan shares in
their accounts by notifying the plan administrator in writing to that effect and
specifying in the notice the number of shares to be withdrawn. Certificates for
whole shares of Common Stock so withdrawn will be registered in the name of the
participant and issued to the participant within thirty (30) days of the plan
administrator's receipt of notice of withdrawal. Certificates for fractional
shares of Common Stock will not be issued under any circumstance. In lieu of
issuing certificates for fractional shares of Common Stock, any fractional
interest withdrawn will be liquidated by the plan administrator on the basis of
the then current market value of the Common Stock and a check issued for the
proceeds thereof. Any notice of withdrawal from an account received less than
five (5) business days prior to a dividend record date will not be effective
until dividends paid on such record date with respect to the plan shares in the
account have been reinvested in Common Stock under the plan and such Common
Stock has been credited to the participant's account. There are no fees for
withdrawing from the plan, other than fees related to the issuance or sale of
shares of Common Stock.

      Participants may request the plan administrator to sell the plan shares
that are withdrawn from their accounts by specifying in the notice of
withdrawal, the number of shares to be sold. The plan administrator will execute
a sale order for such shares within thirty (30) days of receipt of the notice,
and will deliver to the participant a check for the proceeds of the sale, less
any brokerage commissions, a $15.00 service fee, and applicable withholding
taxes and transfer taxes incurred in connection with the sale. A request for
plan shares to be sold must be signed by each person in whose name the account
appears, with signatures guaranteed.

      Any plan shares remaining in a participant's account after withdrawal will
continue to be held for the participant by the plan administrator, and dividends
on such plan shares will continue to be reinvested under the plan. A participant
who withdraws all of the plan shares in his or her account will be treated as
having terminated participation in the plan. A participant who

<PAGE>

withdraws a portion of the plan shares from his or her account and who does not
instruct the plan administrator to sell such shares, will effectively terminate
participation in the plan, unless such shares are sold by the participant after
they are withdrawn from his or her account. A holder of Common Stock may
participate in the plan only with respect to all of his or her Common Stock held
in the plan, and may not participate in the plan with respect to less than all
of his or her shares of Common Stock.

13.   TERMINATION OF PARTICIPATION

      A participant may terminate participation in the plan at any time by
giving written notice thereof to the plan administrator in a form established by
the plan administrator. The Board of Directors of the Bank, in its sole
discretion at any time, may send written notice to a participant, with a copy
sent to the plan administrator, by which the participant's participation in the
plan is terminated; in any such case, the participant shall be treated as if he
or she has terminated participation in the plan as of the date of mailing of
such notice.

      Within thirty (30) days after the date on which any such notice is
received by the plan administrator (the "termination date"), the plan
administrator will deliver to the participant: (a) a certificate for all whole
plan shares held in the participant's account, (b) a check representing any
uninvested dividends held by the plan administrator for the participant, and (c)
a check in lieu of the issuance of any fractional share of Common Stock credited
to the participant's account, equal to (i) the proceeds from the sale of such
fractional share on the open market, less any brokerage commissions, a $10.00
fee to issue the shares of Common Stock and applicable withholding taxes and
transfer taxes incurred, or (ii) the fractional share multiplied by the fair
market value of the Common Stock as of the termination date, less a $10.00 fee
to issue the shares of Common Stock. Any notice of plan termination received
from a participant less than five (5) business days prior to a dividend record
date will not be effective until the dividends paid on such record date with
respect to the plan shares in the account have been reinvested in Common Stock
under the plan and such Common Stock has been credited to the participant's
account.

      In the alternative, a participant may request in his or her notice of plan
termination delivered to the plan administrator, that all of the plan shares in
the participant's account be sold. A request for plan shares to be sold must be
signed by all persons in whose names the account appears, with signatures
guaranteed. If such a sale is requested, the plan administrator will direct the
plan purchasing agent to execute a sale order providing for the sale of such
plan shares within thirty (30) days of its receipt of such request, and will
also direct the plan purchasing agent to deliver to the participant a check for
the proceeds of the sale, less any brokerage commissions, a $15.00 service fee,
and applicable withholding taxes and transfer taxes incurred.

14.   STOCK CERTIFICATES

      Unless a request is made in writing to the plan administrator which
includes the payment of a service fee of $10.00, participants will not be issued
certificates for shares held in custody by the plan administrator. Certificates
will, however, be issued to participants upon withdrawal of plan shares or upon
termination of participation in the plan and will be registered in the name or
names in which the participant's account is maintained. If a participant
requests a certificate to be registered in a name other than that shown on the
account, such request must be signed by all

<PAGE>

persons in whose names the account is registered, with signatures guaranteed,
and be accompanied by such other documentation as the plan administrator may
require.

      Participants may not pledge or assign plan shares credited to their
accounts, or pledge, assign or transfer any of their rights or interests under
the plan, and any such purported pledge, assignment or transfer shall be void
and of no force or effect.

15.   STOCK DIVIDENDS, SPLITS AND OFFERINGS

      Any shares of capital stock resulting from a stock dividend or stock split
by the Bank with respect to the plan shares of a participant shall be added to
the participant's account with the plan administrator as additional plan shares.
Stock dividends or shares resulting from a stock split that are distributable
with respect to shares of Common Stock held of record in a participant's name
will be credited to the participant's account and no stock certificates will be
issued. This provides plan participants with a convenient and economical method
of safe keeping of stock certificates.

      In the event of any change in the Common Stock held by the plan
administrator under the plan as a result of a stock split, reverse stock split,
stock dividend or similar transaction, the number of plan shares shall be
appropriately adjusted. Also, the total shares available for issuance pursuant
to the plan will be adjusted to reflect the stock split, stock dividend or
similar transaction.

      In the event of any "rights" or similar offering by the Bank of any of its
capital stock, the Plan shares credited to a participant's account shall be
treated as shares of Common Stock held of record by the participant in his or
her name for purposes of such offering.

<PAGE>

16.   INCOME TAX ASPECTS

      The reinvestment of dividends does not relieve the participant of any
income tax which may be payable on such dividends. The payment by the Bank of
service fees and brokerage commissions in connection with dividend reinvestment
is considered income to the participant and reported as such to the Internal
Revenue Service. If a participant is subject to United States backup withholding
tax on dividends, the amount of the tax to be withheld will be deducted from the
amount of the dividends and only the reduced amount will be reinvested in Common
Stock. Statements of account for these participants indicate the amount
withheld. At year end, the plan administrator provides each participant with
summary information for tax purposes at no charge to the participant. (See
Paragraph 10, above.)

17.   AMENDMENT, SUSPENSION OR TERMINATION OF PLAN

      The Board of Directors of the Bank may amend, supplement, suspend, modify
or terminate the plan at any time without the approval of the participants. The
Board of Directors of the Bank shall endeavor to promptly send to participants
notice of any suspension, termination or material amendment of the plan.
Participants shall in all events have the right to withdraw from the plan. Any
such suspension, termination or material amendment of the plan shall not become
effective until thirty (30) days after notice is mailed to the participants.

18.   INTERPRETATION OF PLAN

      The plan, the authorization form, and the participants' accounts shall be
governed by and construed in accordance with the laws of the Commonwealth of
Pennsylvania, and applicable state and federal securities laws. Any question of
interpretation arising under the plan shall be determined by the Bank pursuant
to applicable state and federal law and the rules and regulations of all
regulatory authorities, and such determination shall be final and binding upon
all participants and the plan administrator. The Bank or, with its consent, the
plan administrator, may adopt rules and regulations from time to time to
facilitate the administration of the plan. Where used in this plan, the plural
shall include the singular and, unless the context otherwise clearly requires,
the singular shall include the plural. The captions of the various paragraphs
contained in this plan are for convenience only and shall not affect the
interpretation or meaning of the provisions of the plan.

19.   NO LIABILITY OF BANK OR PLAN ADMINISTRATOR

      Neither the Bank nor the plan administrator, nor their respective
directors, officers or employees, shall be liable for any act taken in good
faith or for any good faith omission to act, including without limitation, any
claim of liability (a) arising out of failure to terminate a participant's
account upon such participant's death, and (b) with respect to the prices at
which shares of Common Stock are purchased or sold, the times when or the manner
in which such purchases or sales are made, the decision whether to purchase
shares of Common Stock on the open market or from the Bank, fluctuations in the
fair market value of the Common Stock, and (c) any matters relating to the
operation or management of the plan. The foregoing plan was adopted by the Board
of Directors of East Penn Bank on April 18, 2002 and is effective on June 3,
2002.

<PAGE>

USE OF PROCEEDS

      East Penn Bank does not know the number of Common Shares that will
ultimately be purchased under the plan or the prices at which these shares will
be purchased. To the extent that shares are purchased from East Penn Bank, and
not in the open market, East Penn Bank intends to add the proceeds it receives
from the sales to its general funds to be used for general corporate purposes,
including, without limitation, investments in and advances to East Penn Bank's
subsidiaries.

WHERE YOU CAN FIND MORE INFORMATION

      East Penn Bank is subject to the informational requirements of the
Securities Exchange Act of 1934, and therefore files reports, proxy statements
and other information with the Board of Governors of the Federal Reserve System.
These reports, proxy statements and other information (without exhibits) can be
inspected and copied at the Board's Offices Federal Reserve Banks of New York,
Chicago, San Francisco and Philadelphia.

      Reference is made to certain exhibits for further information with respect
to East Penn Bank and the Common Stock offered in this Offering Circular. Any
statements contained in this Offering Circular concerning the provision of any
document are not necessarily complete, and in each instance reference is made to
the copy of that document filed as an exhibit to the registration statement or
otherwise filed with the Federal Reserve. Each statement is qualified in its
entirety by this reference.<PAGE>

                                                                     Exhibit 4.8

[*] =Certain confidential information contained in this exhibit, marked by
brackets with asterisks, has been omitted and filed separately with the
Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities
Exchange Act of 1934, as amended.

                                                                    CONFIDENTIAL

                    LICENSE, DEVELOPMENT AND SUPPLY AGREEMENT

                                     BETWEEN

                                 MCNEIL PDI Inc.

            (acting through its MCNEIL Consumer Healthcare division)

                                       AND

                   IMI INTERNATIONAL MEDICAL INNOVATIONS INC.

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                            Page
                                                                            ----
<S>                                                                         <C>
ARTICLE I       DEFINITIONS...............................................    2

ARTICLE II      DEVELOPMENT OF THE PRODUCT................................    8

ARTICLE III     LICENSE GRANTS, EXCLUSIVITY, AND FUTURE RIGHTS............   10

ARTICLE IV      PAYMENTS AND REPORTS......................................   11

ARTICLE V       GOVERNMENT AUTHORIZATIONS.................................   13

ARTICLE VI      SUPPLY REQUIREMENTS.......................................   14

ARTICLE VII     MANUFACTURE...............................................   19

ARTICLE VIII    PURCHASE PRICE............................................   22

ARTICLE IX      PACKAGING AND LABELING....................................   24

ARTICLE X       INSPECTION................................................   25

ARTICLE XI      WARRANTIES AND INDEMNITIES................................   26

ARTICLE XII     INSURANCE.................................................   29

ARTICLE XIII    PRODUCT RECALLS...........................................   30

ARTICLE XIV     PATENTS AND TRADEMARKS....................................   30

ARTICLE XV      CONFIDENTIALITY...........................................   33

ARTICLE XVI     CONTRACTUAL RELATIONSHIP..................................   36

ARTICLE XVII    TERM AND TERMINATION......................................   36

ARTICLE XVIII   MISCELLANEOUS PROVISIONS..................................   39
</TABLE>

Appendix A - Clinical Development Program
Appendix B - Consumer Product Development Program
Appendix C - Licensed Patents
Appendix D - IMI Trade Marks
Appendix E - Professional Product Specifications
Appendix F - Stability Test Program
Appendix G - Royalty Report
Appendix H - Sales Forecast
Appendix I - Quality Control Procedures
Appendix J - J&J Corporate Quality Systems Regulations
Appendix K - Price Schedule for X-Rite Reader
Appendix L - Statement of Non-Conformity
Appendix M - Returned Goods and Authorization Form

                                        i

<PAGE>

                    LICENSE, DEVELOPMENT AND SUPPLY AGREEMENT

THIS AGREEMENT is made effective the 9/TH/ day of May 2002 by and between IMI
International Medical Innovations Inc., a Canadian corporation, having its
principal place of business at Suite 300, 4211 Yonge Street, Toronto, Ontario,
M2P 2A9, Canada ("IMI") and McNeil PDI Inc., a Canadian corporation, having its
principal place of business at 768 Herbert Street, Desbiens, Quebec, Canada
(acting through its McNEIL Consumer Healthcare division on behalf of McNeil PDI
Inc.) ("MCNEIL").

A. IMI has developed a cardiac risk predictor that measures skin cholesterol (a
novel and independent predictor for Coronary Artery Disease), and a test for use
by trained medical personnel and/or trained healthcare workers was approved for
sale in Canada January 29, 2001 (and a test for consumer use without the
intervention of medical practitioners is currently under development).

B. MCNEIL has experience and expertise in marketing, sales and supply chain
management for manufacturing and assembling medical products.

C. MCNEIL desires to jointly develop with IMI and market certain cardiac risk
predictors, for both professional and consumer markets.

D. IMI desires to have manufactured and supply to MCNEIL such cardiac risk
predictors, at least for an initial period, and MCNEIL desires to have IMI have
manufactured and supply to MCNEIL such cardiac risk predictors, at least for an
initial period.

                                        1

<PAGE>

                                    ARTICLE I

                                   DEFINITIONS

As used in this Agreement, the following terms shall have the following
respective meanings:

1.1 All currency used in this Agreement shall be denominated in Canadian
Dollars, unless specifically identified otherwise.

1.2 "Affiliate(s)" shall mean any company(ies) or other legal entity(ies)
directly or indirectly controlling, controlled by, or under common control with
a respective party. For purposes of this definition, "control" shall mean
possession of the power to direct or cause the direction of the management and
policies of the company or other legal entity, whether pursuant to the ownership
of at least 50% of its voting securities, by contract, or otherwise.

1.3 "Annual Sales" shall mean the Net Sales in a calendar year.

1.4 "Business Day" shall mean any day other than a Saturday, Sunday or any day
that is a national, provincial, municipal or civic holiday in Toronto, Ontario,
Canada.

1.5 "Clinical, Development Program" shall mean the program described in Appendix
A.

1.6 "Confidentiality Agreement" shall mean the confidentiality agreement of
December 7, 2000, between IMI and MCNEIL, which is herein incorporated by
reference.

1.7 "Consumer Product Development Program" shall mean the program described in
Appendix B.

1.8 "Effective Date" shall mean the date first written above.

1.9 "Field" shall mean and include the following to the extent that they relate
exclusively to systems measuring skin cholesterol:

    1.9.1 "Consumer Field" shall mean the field of diagnosing, predicting and
    monitoring of cardiac risk utilizing systems that are approved by the
    applicable governmental

                                       2

<PAGE>

     regulatory authorities for use by individuals without supervision by a
     licensed medical practitioner and that are directly marketed to public
     consumers, other than the Nutraceutical Field, as described below;

     1.9.2 "Nutraceutical Field" shall mean the field of diagnosing, predicting
     and monitoring of cardiac risk utilizing systems that are approved by the
     applicable governmental regulatory authorities for use by individuals
     without supervision by a licensed medical practitioner and that are
     directly marketed to public consumers in association or combination with a
     nutraceutical, vitamin, nutritional supplement, health food or similar
     product;

     1.9.3 "Laboratory Field" shall mean the field of diagnosing, predicting and
     monitoring of cardiac risk utilizing systems that are approved by the
     applicable governmental regulatory authorities for use under the
     supervision of trained medical personnel and/or trained healthcare workers
     and that are operated in an outpatient clinic, medical laboratory, patient
     collection center associated with a laboratory, hospital laboratory or
     similar venue providing laboratory services;

     1.9.4 "Professional Field" shall mean the field of diagnosing, predicting
     and monitoring of cardiac risk utilizing systems that are approved by the
     applicable governmental regulatory authorities for use under the
     supervision of a licensed medical practitioner, other than the Laboratory
     Field, as described above;

     1.9.5 "Other Medical Field" shall mean the field of diagnosing, predicting
     and monitoring of cardiac risk utilizing systems that are approved by the
     applicable governmental regulatory authorities for use in all fields other
     than the Consumer, Nutraceutical, Laboratory and Professional Fields.

                                       3

<PAGE>

1.10 "Key Cardiologists" shall mean medical practitioners that are, in MCNEIL's
sole determination, opinion leaders among cardiologists, endocrinologists,
lipidaemiologists and/or general practitioners with a cardiology practice in
Canada.

1.11 "Licensed Fields" shall mean the Consumer, Nutraceutical, Professional and
Other Medical Fields defined above.

1.12 "Licensed Patents" mean (i) the patents and patent applications (and
patents granted therefrom) owned or controlled by IMI at the date hereof set
forth and as described in Appendix C; and (ii) any and all extensions, renewals,
continuations, continuations-in-part, divisions, patents-of-addition, reissues,
reexaminations, supplementary protection certificates or foreign counterparts of
any of the foregoing; and (iii) any and all patents and patent applications
owned or controlled by IMI with the right to sublicense (now or in the future)
which contain claims, the practice of which would infringe the claims of a
patent or patent application included in i) or ii), to the extent that the
foregoing are used in and solely for the purposes of the Licensed Technology.

1.13 "Licensed Product" means any cardiac risk prediction system which measures
skin cholesterol in the Licensed Fields (or any component thereof) which would
infringe a Valid Claim of any Licensed Patent, but for the license granted in
this Agreement. Licensed Product includes:

     1.13.1 "Consumer Product", which is a cardiac risk prediction system (or
     component thereof) which is marketed in the Consumer Field or Nutraceutical
     Field; and

     1.13.2 "Professional Product" which is a cardiac risk prediction system (or
     component thereof) which is marketed in the Professional Field or Other
     Medical Field.

                                        4

<PAGE>

1.14 "Licensed Technology" means a cardiac risk predictor system exclusively
employing a test that measures skin cholesterol by measuring color changes after
application of an indicator component.

1.15 "Licensed Know-How" means the trademarks identified in Appendix D hereto
together with any and all present and future inventions, improvements,
discoveries, claims, formulae, processes, data, trade secrets, software,
technologies, and know-how that are owned or controlled or licensed (to the
extent that such are freely sub-licensable without consent or consideration of
any kind by any third party) by IMI the practice of which would infringe any
Licensed Patents and which are i) incorporated in the manufacture, use or sale
of Licensed Products or ii) claimed or disclosed in any patent or patent
application included in Licensed Patents.

1.16 "Manufacturer's Cost" shall mean the total monies and other consideration
paid by IMI to its suppliers, contractors, and/or subcontractors for the
Licensed Product that is supplied to MCNEIL (including all costs incurred by IMI
to unaffiliated third parties in connection with the importation, sale and
shipment or delivery of Licensed Products to MCNEIL as contemplated herein) less
the following amounts (i) discounts, rebates, or trade allowances actually
allowed or granted to IMI in connection with the Licensed Products (other than
discounts associated with early or prompt payment) and (ii) credits or
allowances actually granted to IMI upon claims (including, without limitation,
claims for destroyed goods) or returns in connection with the Licensed Products,
regardless of the party requesting the return.

1.17 "Net Sales" shall mean the total of (a) all amounts billed, invoiced, or
received (whichever occurs first) for sales or other transfers by (and includes
the fair market value of all non-cash consideration received by) MCNEIL and its
Affiliates and sublicensees from the sale or other transfer of Licensed Product
to third parties and (b) all cash and non-cash consideration

                                       5

<PAGE>

(valued at the fair market value thereof) received by MCNEIL and its Affiliates
in respect of issue fees, maintenance fees, option payments, milestone payments,
and similar non-royalty payments made by sublicensees on account of sublicenses
pursuant to this Agreement from the sublicensing of some or all of the Licensed
Patents and the Licensed Know-How or any grant of rights in connection
therewith, less the following amounts (i) discounts, rebates, or trade
allowances actually allowed or granted in connection with the Licensed Products,
(ii) credits or allowances actually granted upon claims (including, without
limitation, claims for destroyed goods) or returns in connection with the
Licensed Products, regardless of the party requesting the return, (iii) 2% of
the total monies received by MCNEIL and its sublicensees from the sale of
Licensed Product to independent third parties for freight and distribution
charges paid for delivery, and (iv) sales taxes or other governmental charges
(including GST) levied on or measured by the invoiced amount whether absorbed by
the billing or the billed party.

     1.17.1 In the event that the Licensed Products are sold as part of a
     combination product, the Net Sales of the Licensed Products, for the
     purposes of determining royalty payments shall be determined by multiplying
     the Net Sales (as defined in this definition) of the combination product,
     on a per product basis, by the fraction A/(A + B), where A is the average
     sales price of the Licensed Product over the prior 12 month period when
     sold separately in finished form and B is the average sales price of the
     other product(s) over the same 12 month period sold separate in finished
     form. In the event that such average sales price cannot be determined for
     both the Licensed Products and other product(s) in combination, Net Sales
     for purposes of determining royalty payments shall be calculated by
     multiplying the Net Sales of the combination products, on a per product
     basis, by the fraction C/(C + D), where C is MCNEIL's Purchase Price (as
     defined in Section 8.1

                                       6

<PAGE>

     hereof) of the Licensed Products and D is the cost of goods of the other
     product(s), determined in accordance with the method of accounting normally
     employed by MCNEIL in computing cost of goods.

     1.17.2 In the event of (i) a sale or transfer of any Licensed Products by
     MCNEIL, including a sale or transfer to an Affiliate, which are not
     intended for commercial use and which are not to be sold to third parties
     or (ii) the use by MCNEIL or any of its Affiliates of any Licensed Products
     which have been acquired, such Licensed Products shall for the purposes of
     calculating Net Sales be deemed to have been sold to third parties at a
     price equal to the lesser of (i) ***** ***** (as defined in Section
     8.1 hereof). Notwithstanding the foregoing, the provision of Licensed
     Products as samples in a manner and in quantities consistent with customary
     industry practice shall not be deemed to amount to a Net Sale of such
     Licensed Products.

     1.17.3 For the purposes of the determination of Net Sales for a particular
     sale, such sale shall be deemed to be invoiced at the earlier of (i) the
     date of the actual invoice in respect of such sale and (ii) the date of
     shipment of the Licensed Products to a customer.

1.18 "Specifications" shall mean, in respect of a particular Licensed Product,
the specifications for the Licensed Product and/or the imprinting and bulk
packaging thereof including physical, quality analysis and assurance, test
methodologies, bulk packaging, handling, shipping and other standards,
instructions and procedures for the Licensed Product and its Raw Materials. All
Specifications and any changes agreed to by the parties from time to time shall
be in writing. The current Specifications with respect to the Professional
Product (in its currently intended embodiment) are attached hereto as Appendix
E.

1.19 "Stability Test Program" shall mean the program described in Appendix F.

                                        7

<PAGE>

1.20 "Territory" shall mean Canada and its territories and possessions.

1.21 "Valid Claim" means a claim in any unexpired, issued patent within the
Licensed Patents which has not been held invalid or unenforceable by a
nonappealed or unappealable decision by a court or other appropriate body of
competent jurisdiction, and which is not admitted to be invalid through
disclaimer, dedication to the public or otherwise.

                                   ARTICLE II

                           DEVELOPMENT OF THE PRODUCT

2.1  IMI will work with MCNEIL as herein set out in an effort to commercialize
Licensed Product in the Professional Field. At MCNEIL's expense, IMI agrees to
conform Licensed Product, including without limitation software, to reflect
MCNEIL's trademarks and commercially reasonable packaging, product format, and
labeling requirements. IMI will conduct research and development as herein set
out to work towards the development of a commercially salable Licensed Product
in the Consumer Field.

     2.1.1 IMI will conduct the Clinical Development Program as described in
     Appendix A. The data generated by this program is intended to be sufficient
     to support and/or investigate product claims, product indications, and/or
     market positioning, as appropriate. The data generated is intended to be
     used in preparing submissions by IMI to gain governmental regulatory
     approvals in the Territory relating to a Licensed Product in the
     Professional Field.

     2.1.2 IMI will conduct the Consumer Product Development Program as
     described in Appendix B. The data generated by this program is intended to
     provide support for and/or investigate product claims, product indications,
     and/or market positioning of a Licensed Product in the Consumer Field, as
     appropriate. The data generated is intended

                                        8

<PAGE>

     to be used in preparing submissions by IMI to gain governmental regulatory
     approvals in the Territory relating to a Licensed Product in the Consumer
     Field.

2.2  IMI shall bear all of its costs related to the Clinical Development Program
and the Consumer Product Development Program, including without limitation the
portions of such program which relate to the consumer delivery system(s) for a
Consumer Product, testing technology(ies) and related computer software to meet
specifications mutually agreed upon by IMI and MCNEIL.

2.3  Either IMI or MCNEIL may suggest changes to the scope, activities,
direction or sequence of the research and development, including without
limitation product design goals, specifications, and schedules, which shall be
effected upon mutual agreement of the parties.

2.4  Prior to and (with the exception of Section 2.4.1 hereof) after the launch
of a Licensed Product in any applicable Licensed Field, MCNEIL agrees to perform
the following activities and services:

      2.4.1 Conduct market research on any such Licensed Product opportunity as
            needed and as determined by MCNEIL, acting reasonably;

      2.4.2 Provide consumer expertise and direction in the development of such
            Licensed Product (design specifications, costing, etc.);

      2.4.3 Provide consumer marketing/development expertise in the development
            of such Licensed Product;

      2.4.4 Develop marketing strategies and appropriate sales support material
            for such Licensed Product; and

      2.4.5 Provide IMI with sales forecasts for any such Licensed Product in
            each of the Licensed Fields for IMI's contract manufacturers.

2.5  After the launch of a Licensed Product in the Professional Field, MCNEIL
agrees to perform the following activities and services:

      2.5.1 MCNEIL medical sales force will drop off selected product literature
            to *****;

      2.5.2 Provide Professional Products to a total of ***** for testing
            purposes;

      2.5.3 As MCNEIL attends a number of health-related exhibits annually, some
            of which may relate to the Licensed Products, MCNEIL may desire to
            invite and to provide space for IMI personnel in the MCNEIL
            exhibiting booth, at least during calendar years 2002 and 2003,
            unless this Agreement is terminated earlier, to demonstrate the
            Licensed Products at professional event exhibits mutually agreed
            upon by MCNEIL and IMI. MCNEIL reserves the right to establish
            professional event exhibit guidelines and procedures covering IMI's
            involvement and activities at these exhibits. The guidelines and
            procedures will include, but not be limited to, the allocation of
            exhibit space, the priority of messages provided, the amount of
            promotional/advertising space, etc. to ensure, in MCNEIL's sole
            opinion, the appropriate message delivery of the products, services
            or opportunities being presented. MCNEIL shall reimburse IMI for its
            out-of-pocket costs of having its personnel attend and participate
            in such exhibits.

                                        9

<PAGE>

                                  ARTICLE III

                 LICENSE GRANTS, EXCLUSIVITY, AND FUTURE RIGHTS

3.1  For the term of this Agreement, IMI hereby grants to MCNEIL the exclusive
right and license in the Licensed Fields under the Licensed Patents and Licensed
Know-How to use, sell and have sold products. processes and/or apparatus
embodying the Licensed Patents and/or Licensed Know-How in the Territory. MCNEIL
may grant sublicenses of such rights, subject to IMI's prior written approval.
IMI's approval will be deemed granted unless it provides written objection
within fifteen (15) Business Days of MCNEIL's written notification of its desire
to grant a particular sublicense. MCNEIL shall not use or sublicense any rights
granted hereunder or offer any Licensed Products to any person whom MCNEIL has
reason to believe will use such rights or Licensed Products outside of the
Territory.

3.2  IMI hereby grants to MCNEIL a non-assignable option to an exclusive license
in the Laboratory Field in the Territory, exercisable by written notice to IMI
of such exercise prior to the first anniversary of the Effective Date (subject
to payment by MCNEIL to IMI of a one-time fee of one hundred thousand dollars
($100,000.00) within ten (10) days of providing such notice to IMI). Upon due
and timely payment of such one-time fee, the Licensed Fields, as defined in
Section 1.11 above, will be deemed to include the Laboratory Field, and the
Licensed Products, as defined in Section 1.13 above, will be deemed to include a
cardiac risk prediction device or component thereof developed for and intended
for sale in the Laboratory Field, provided that such inclusions shall not
obligate IMI to develop any Licensed Product independent of any existing
Consumer Product or Professional Product. In the event of MCNEIL's exercise of
such option, it shall perform similar activities and services as those outlined
in Sections 2.4 and 2.5 hereof in connection with the Laboratory Field.

                                       10

<PAGE>

3.3  Subject to the provisions of Article XV hereof, and solely for the purposes
of obtaining marketing data for use in Canada, IMI hereby consents to MCNEIL
reviewing and testing the Licensed Product for use in the Professional Field and
the concept relating thereto (including, without limitation, the
pharmaco-economic model associated therewith) in the United States solely as a
basis for discussions with a U.S. third party health management organization.
Notwithstanding the foregoing, no disclosure shall be made without the prior
written approval of IMI and on terms which IMI determines in its sole discretion
appropriately protect its proprietary interests.

3.4  If, at any time during the term of this Agreement, MCNEIL has a desire to
obtain a license, as otherwise described in this Article III but outside of
Territory, MCNEIL shall have the right to enquire about such license from IMI.
If IMI has not, at the time of MCNEIL's enquiry,
already licensed the desired rights to a third party or unless IMI otherwise
considers that it is not in IMI's best interests to engage in such discussions,
IMI will enter into discussions with MCNEIL concerning such license (provided
that nothing herein contained shall in any way limit IMI's right and ability to
terminate any such discussions at any time for any reason).

                                   ARTICLE IV

                              PAYMENTS AND REPORTS

4.1  As consideration for the rights granted herein by IMI to MCNEIL, MCNEIL
hereby agrees to make the following payments to IMI:

     4.1.1 MCNEIL will pay a royalty to IMI on the Net Sales of Licensed Product
at one of the following rates:

            (a)   ***** of Net Sales in a calendar year if Annual Sales for such
                  calendar year are less than or equal to *****.

            (b)   ***** of Net Sales in a calendar year if Annual Sales for such
                  calendar year are greater than ***** and less than or equal to
                  *****.

            (c)   ***** of Net Sales in a calendar year if Annual Sales for such
                  calendar year are greater than *****.

                                       11

<PAGE>

     By way of example, if Annual Sales are $*****, then the royalty shall be
     *****. If royalty payments for a given quarterly period, as contemplated
     in Section 4.1.1, are based upon a particular level and expectation of
     Annual Sales in a given calendar year giving rise to a calculation based
     upon one of subsections (a) - (c), as applicable, and it is subsequently
     determined that the Annual Sales for such year will require payments to be
     made as contemplated in a different subsection (a) - (c), as applicable,
     then MCNEIL shall make an additional payment or shall be credited to
     adjust for the prior underpayment or overpayment. By way of example, if
     Net Sales in the first half of a year are $*****, and if McNeil pays
     royalties based upon ***** of that amount for such periods, and if the Net
     Sales in the third quarter of such calendar year are *****, then the
     royalty payment for such third quarter shall be the sum of (i) ***** and
     (ii) ***** (in order to compensate for the underpayments in respect of the
     first two quarters of such year).

     4.1.2 MCNEIL will make the following one-time milestone payments to IMI
     based on the combined Net Sales of all Licensed Product:

          (a)  ***** after the Annual Sales first exceed *****

          (b)  ***** after the Annual Sales first exceed *****

          (c)  ***** after the Annual Sales first exceed *****

          (d)  ***** after the Annual Sales first exceed *****

     The one-time milestone payments due under this Section 4.1.2 are
     cumulative, such that if in the first year Annual Sales total *****, the
     milestone payment to IMI would be *****.

     4.1.3 MCNEIL will make the following one-time milestone payments to IMI
     based on the Net Sales of Consumer Products:

          (a)  ***** after the Annual Sales first exceed *****

          (b)  ***** after the Annual Sales first exceed *****

     The milestone payments due under this Section 4.1.3 are cumulative, such
     that if in the first year Annual Sales of the Consumer Products total
     *****, the milestone payment to IMI would be *****.

4.2  MCNEIL shall keep true and accurate records and books of account containing
all data reasonably required for the computing of and verification of the Net
Sales and payments to be made in accordance with this Article. Such records
shall be retained for at least the period of time that documentation must be
preserved in accordance with the requirements and guidelines of applicable
government authorities (but in no event less than seven years) and shall be
available during normal business hours for inspection by IMI's agents on its
behalf for the sole purpose of verifying the amount of payments to be made
hereunder. In the event that any such inspection shows an under-reporting and
underpayment for any three month period, then MCNEIL shall pay such amount to
IMI. In the event that any such inspection shows an over-

                                       12

<PAGE>

reporting and overpayment for any three month period, then MCNEIL shall reduce
any then current payments owed to IMI by such amount. In the event that any such
inspection shows an under-reporting and underpayment in excess of five percent
for any three month period, then IMI shall also be entitled to be reimbursed for
the cost of the inspection. Within fifteen (15) days following each quarterly
period of a calendar year during which royalties are due under this Agreement,
MCNEIL shall render to IMI the written report attached as Appendix G which sets
forth the amount of royalties due and payable based on sales of such Licensed
Products during such calendar quarter, and MCNEIL shall, upon rendering such
report, remit to IMI the amount of royalties shown thereby to be due.

                                   ARTICLE V

                            GOVERNMENT AUTHORIZATIONS

5.1  IMI shall conduct the Consumer Product Development Program in accordance
with Section 2.1.2 hereof.

5.2  Notwithstanding the previous section, MCNEIL shall have the right to
participate with IMI in communications with the governmental health authorities
in the Territory for all issues relating to a Licensed Product. Therefore, IMI
shall promptly provide copies to MCNEIL of all correspondence received from any
governmental health authorities in the Territory relating to any Licensed
Product and shall consult with MCNEIL prior to responding to any such
correspondence and prior to initiating any other communications with any
governmental health authorities in the Territory relating to any Licensed
Product.

5.3  Under terms of this Agreement MCNEIL will have the responsibility of
communicating with consumers and the health care profession and some of these
communications may relate to complaints related to the Licensed Products. MCNEIL
agrees to provide notice of any complaint

                                       13

<PAGE>

relating to the Licensed Products to IMI within 72 hours of the receipt of such
complaint, confirmed in writing within fifteen (15) days of the receipt of such
complaint. IMI agrees to provide written notice of any complaints relating to
the Licensed Products that it may receive to MCNEIL within 72 hours of the
receipt of such complaint, confirmed in writing within fifteen (15) days of the
receipt of such complaint. IMI agrees to undertake all actions necessary to
comply with regulatory and legal requirements relating to the Licensed Products
arising from the complaints to the extent that IMI determines that the
complaints are justified. Should MCNEIL, in MCNEIL's sole discretion, deem
further actions necessary, IMI agrees to cooperate with MCNEIL and to allow
MCNEIL to make any notification MCNEIL in its sole discretion deems appropriate
to any governmental agency. Should IMI, in IMI's sole discretion, deem further
actions necessary, MCNEIL agrees to cooperate with IMI and to allow IMI to make
any notification IMI in its sole discretion deems appropriate to, or make any
response required of, any governmental agency. Following these actions, MCNEIL
will have the responsibility of communicating with consumers and the health care
profession. Unless otherwise required by law, each of IMI and MCNEIL will
consult with one another with respect to the form and substance of all
communications contemplated in this Section.

                                   ARTICLE VI

                               SUPPLY REQUIREMENTS

6.1  During the term of this Agreement in the Territory, and subject to the
provisions of this Article VI, IMI shall have manufactured for and supply to
MCNEIL, all of the Licensed Product as may be required of IMI by MCNEIL, and
MCNEIL shall purchase all of its requirements for the Licensed Product from IMI,
all of which shall be manufactured in accordance with their respective
Specifications.

                                       14

<PAGE>

     6.1.1 In the event that IMI is unable to supply all of the Licensed Product
     as may be required by MCNEIL from the manufacturing facilities as referred
     to in Section 7.1 because of either: (i) a force majeure as detailed in
     Section 19.8, which force majeure continues uninterrupted for a period in
     excess of ninety (90) days; and/or (ii) a failure to meet binding estimates
     for expected purchases of Licensed Product pursuant to the forecasts
     provided pursuant to Section 6.3 hereof for a consecutive three (3) month
     period, IMI hereby grants to MCNEIL and its Affiliates under Licensed
     Patents and Licensed Know-How, a license, with the right to grant
     sublicenses, to make, have made, and use Licensed Product anywhere in the
     world solely for sale in the Territory only for that period of time during
     which the force majeure and/or production limitations continue to exist and
     only to the extent necessary to meet any binding estimate for such expected
     purchases pursuant to such forecasts, after which such license shall
     immediately terminate (and, for greater certainty, MCNEIL shall be entitled
     to sell or otherwise distribute such levels of inventories of such Licensed
     Product). For greater certainty, the parties acknowledge that such license
     grant shall not be operative in connection with any failure by IMI to meet
     revised projections for formerly binding estimates provided pursuant to
     succeeding forecasts. Subject to Section 10.3, IMI shall reimburse any
     extra costs paid to third parties that MCNEIL shall incur as a result of
     IMI's failure to supply MCNEIL's required quantities of Licensed Product.

     6.1.2 In the event that MCNEIL believes that:

           (i)  one or more components of any Licensed Product may be obtained
                at an appropriate quality level for a lower price than supplied
                through IMI, or

                                       15

<PAGE>

           (ii) the supply of any Licensed Product or one or more components of
                any Licensed Product may be improved through sources other than
                through IMI's suppliers;

     and MCNEIL identifies to IMI a potential supplier (the "Alternate
     Supplier") anywhere in the world which is satisfactory to IMI and which is
     able to manufacture Licensed Product or such components, as the case may
     be, in accordance with the Specifications, then provided that the obtaining
     of such components would not have an effect on the regulatory approval
     relating to the marketing of such Licensed Product, IMI may enter into a
     supply agreement with the Alternate Supplier on terms and conditions
     satisfactory to IMI and MCNEIL.

           6.1.2.1  MCNEIL shall reimburse IMI for all costs paid to third
           parties in connection with entering into supply arrangements with the
           Alternate Supplier and in connection with verifying that the
           Alternate Supplier will be able to manufacture in accordance with the
           Specifications and that such arrangements will not effect any
           governmental or regulatory approvals obtained or required to be
           obtained to market such Licensed Product (or, if they will affect
           such approvals, that such approvals may be obtained on reasonable
           terms if the Alternate Supplier supplies the Licensed Product), and
           shall indenmify and hold IMI harmless from all liabilities and
           obligations arising under such supply arrangements relating to any
           payments which IMI shall be required to make in connection therewith
           relating to obtaining such supply (including, without limitation, any
           up-front payments and any minimum quantities which must be
           purchased).

                                       16

<PAGE>

           6.1.2.2  Notwithstanding anything contained in this Agreement, IMI
           shall have no liability to MCNEIL as a result of any breach or
           non-performance of an Alternate Supplier that provides Licensed
           Products or otherwise in respect of any Licensed Products supplied by
           the Alternate Supplier unless (i) IMI shall have expressly agreed in
           writing with MCNEIL that the provisions of this Section 6.1.2.2 and
           the indemnification (and hold harmless) provisions of Section 6.1
           .2.1 shall not apply or (ii) IMI has contracted with the Alternate
           Supplier on an exclusive basis for the supply of Licensed Products.

6.2  Upon ninety (90) days written notice to MCNEIL, IMI may assign or otherwise
transfer to MCNEIL any or all of its rights and obligations arising under its
agreements relating to the supply and/or manufacture of Licensed Products and/or
components thereof in the Territory. MCNEIL shall have the right to amend or
renegotiate any agreement prior to accepting such assignment or transfer.

6.3  Prior to the beginning of the first full calendar month following the
execution of this Agreement, and thereafter by the ***** Business Day of each
succeeding calendar month, MCNEIL shall provide IMI with an estimate of and
commitment for its expected purchases of each Licensed Product in each of the
following twelve (12) months, which forecast shall be non-binding in respect of
each of the last ***** months of such ***** month period and shall be binding in
respect of each of the first ***** months of such ***** month period. Each
succeeding forecast shall revise any preceding forecasts (but shall not amend
any month in respect of which there was a binding commitment except with the
consent of IMI). To the extent that any succeeding forecast reflects revised
increased projections for purchases for a month for which a binding estimate has
already been given through a prior forecast, IMI shall use commercially
reasonable efforts to meet such increased demand but shall have no liability to
MCNEIL if it is unable for any reason to do so. The form of estimate and
commitment of MCNEIL with respect to the Licensed Product is attached as
Appendix H hereto. Notwithstanding anything contained herein, IMI shall have no
liability to MCNEIL in respect of the failure to deliver Licensed Product in
respect of which a binding commitment has not been

                                       17

<PAGE>

made by MCNEIL hereunder. All forecasts and commitments by MCNEIL shall be
subject to the provisions of Section 6.4 hereof.

6.4  MCNEIL shall place purchase orders for the Licensed Product with IMI from
time to time in accordance with the amounts committed under Section 6.3,
specifying the quantities of the Licensed Product desired, and the place(s) to
which and the manner and dates by which, shipment is to be made; said shipment
dates to be no less than thirty (30) days from the purchase order date. IMI
agrees to use commercially reasonable efforts to fulfill purchase orders,
including such as may be in excess of the forecast amounts which are binding
pursuant to Section 6.3, but shall have no obligation to accomplish such
fulfillment beyond such binding forecast amounts. Should the purchase orders, in
any given period, exceed the forecast amounts which are binding pursuant to
Section 6.3, the parties will jointly undertake commercially reasonable
activities to attempt to fulfill such requirements. MCNEIL shall be responsible
for making all commercially reasonable arrangements necessary associated with
delivery of Licensed Products and/or the components thereof after such items are
available for pick-up at the site of manufacture thereof.

6.5  Subject to the foregoing provisions of this Article VI, IMI shall satisfy
all purchase orders by shipment of all ordered Licensed Product, no later than
the shipment dates provided in MCNEIL's purchase orders to the place(s) and in
the manner directed by MCNEIL.

6.6  As of the time of delivery by IMI, the Licensed Product will conform to the
Specifications.

6.7  IMI and its selected manufacturer shall perform quality control tests and
assays, as appropriate and set out in Appendix I, on all packaging, raw
materials and finished Licensed Product or portions thereof, in accordance with
the Specifications, and IMI's and its selected

                                       18

<PAGE>

manufacturer's customary procedures. IMI and its selected manufacturer shall
prepare and maintain, as hereinafter contemplated, batch records and a retained
sample, properly stored, from each lot or batch of Licensed Product or portions
thereof manufactured, sufficient to perform quality control tests specified in
the Specifications at least twice; the obligation in the foregoing sentence
shall apply:

     (a)  in respect of the Reader, for the duration of the then-projected
          useful life of the Reader; and

     (b)  in respect of all other components of the test kits, samples shall be
          maintained until the expiry date of the particular samples and batch
          records shall be maintained for ***** thereafter.

A copy of the certificate of analysis shall be provided to MCNEIL with each
batch or lot shipped to MCNEIL.

6.8  All Licensed Product, from the time it is available to be shipped by IMI or
on its behalf in accordance with the purchase orders, shall have a remaining
shelf life of not less than *****, provided, however, that IMI shall undertake
research and development with a view to increasing such shelf life.

6.9  In the event IMI is unable to fill all orders for Licensed Product,
including its own demand thereof, IMI shall first allocate all of its available
capacity to MCNEIL before filling the orders of its other customers or
fulfilling its own demand.

                                   ARTICLE VII

                                   MANUFACTURE

7.1  In the manufacture of the Licensed Product for MCNEIL, IMI shall ensure
compliance, by itself and its suppliers and subcontractors, with all applicable
US FDA and J&J Corporate Quality Systems Regulations as outlined in Appendix J
and all applicable federal, provincial and local government and regulatory
requirements (including, without limitation, safety and

                                       19

<PAGE>

environmental requirements) and all applicable Specifications. IMI agrees to
keep exact, true and complete records of the supply of the Licensed Product to
MCNEIL and IMI agrees to require that its suppliers keep exact, true and
complete records of the manufacture and supply of the Licensed Product to
MCNEIL, which shall at all reasonable times, and upon reasonable notice be
available for examination, audit and copying by MCNEIL and its representatives.
IMI shall have the Licensed Product manufactured at its suppliers plants located
in Diagnostic Chemicals Limited, Charlottetown, Prince Edward Island, Canada and
X-Rite Incorporated, Grandville, Michigan, USA. or such other manufacturers
selected by IMI and which are satisfactory to MCNEIL, acting reasonably.

7.2  In the event MCNEIL and IMI mutually determine to amend the Specifications
in any respect, IMI shall use its reasonable commercial efforts to implement
such amendments through its suppliers (and, if considered commercially
reasonable and if such suppliers are unwilling or unable to implement such
amendments, then the parties will mutually consider changing suppliers or
further modifying the Specifications in a manner which may be implemented
through the existing suppliers), or such other amendments as may be mutually
agreed to by the parties. If any such amendments are requested by MCNEIL, MCNEIL
shall be responsible for reimbursing IMI for all costs associated therewith.
Except as contemplated in Section 9.1, IMI and MCNEIL shall agree on all
amendments to the Specifications.

7.3  MCNEIL shall have the right, at its own expense, to inspect at all
reasonable times during normal business hours, and on reasonable prior notice to
IMI and the manufacturer, as applicable, the operations and facilities of IMI
and its suppliers in which the Licensed Product is manufactured, packaged,
inspected, tested, labeled, stored or shipped; provided, that IMI or such
supplier may refuse entry to areas where products of other customers are being
manufactured,

                                       20

<PAGE>

inspected or packaged, in order to fulfill its obligations of confidentiality to
these customers. IMI agrees to comply with MCNEIL's reasonable requests and to
ensure that its suppliers comply with MCNEIL's reasonable requests to modify
plant conditions, policies or practices, to conform said conditions, policies or
practices to all applicable regulatory requirements and all Specifications.

7.4  IMI and MCNEIL agree to permit and fully cooperate with, and to require its
suppliers to permit and fully cooperate with, any inspections by federal or
provincial regulatory representatives of the facilities used to manufacture or
store Licensed Product. IMI shall notify MCNEIL immediately when the inspection
is scheduled, allow representatives of MCNEIL to be present at such inspection
and report the results of any such inspection relating to the manufacture of
Licensed Product to MCNEIL. IMI further agrees to comply with and require its
suppliers to comply with all required modifications as may be necessary to
conform to all applicable regulatory requirements.

7.5  IMI shall, and shall require its supplier to, conduct regular stability
tests of chemical components and finished goods of the Licensed Product pursuant
to the Stability Test Program (Appendix F) and to provide written stability
reports in compliance with such test program to MCNEIL within one month of the
conclusion of each calendar year. IMI agrees to initiate and pursue an ongoing
stability program with the objective of extending the *****. IMI shall
promptly notify MCNEIL of any batch of Licensed Product or component thereof
that fails to meet any minimum standard set out in such Test Program.

                                       21

<PAGE>

                                  ARTICLE VIII

                                 PURCHASE PRICE

8.1  MCNEIL shall purchase from IMI and IMI shall sell to MCNEIL all of the
Licensed Product as may be ordered by MCNEIL at a price (the "Purchase Price")
equal to the amount which results when the Multiple is multiplied by the
Manufacturer's Cost. For the purposes hereof, the "Multiple" shall, in a given
calendar year, be

     (i)   ***** in respect of all components of the Purchase Price other than
           that amount (the "Reader Amount") of the Manufacturer's Costs
           relating to monies and other consideration paid by IMI to the
           suppliers, contractors, and/or subcontractors of the colour
           measurement instrument (the "Reader"), if royalties are paid pursuant
           to Section 4.1.1(a) in the year in which the Licensed Product is
           shipped to MCNEIL;

     (ii)  ***** in respect of all components of the Purchase Price other than
           the Reader Amount, if royalties are paid pursuant to Section
           4.1.1(b) in the year in which the Licensed Product is shipped to
           MCNEIL;

     (iii) ***** in respect of all components of the Purchase Price other than
           the Reader Amount, if royalties are paid pursuant to Section 4.1.1(c)
           in the year in which the Licensed Product is shipped to MCNEIL; and

     (iv)  ***** for the Reader Amount, *****

     If the Multiple for a given Manufacturer's Cost is based upon a particular
     level and expectation of Annual Sales in a given calendar year giving rise
     to a calculation based (and, therefore, a particular royalty rate pursuant
     to Section 4.1.1), and if it is subsequently determined that the royalty
     rate for such year is different, then IMI shall,

                                       22

<PAGE>

          after it is determined what the royalty rate in respect of such year
          is, shall make such payments to MCNEIL to adjust for the prior
          payment, without interest. ***** Subject to the terms hereof, MCNEIL
          shall be able to consult with IMI in connection with any problems
          arising in connection with service, regulatory or cost of goods issues
          associated with the manufacture of Licensed Products. However, if IMI
          ceases to supply any Licensed Products to MCNEIL, no Administration
          Charge or Minimum Administration Charge shall be payable to IMI.

8.2       The Purchase Price will be F.O.B. IMI's place of manufacture or supply
and will be inclusive of all imprinting and bulk packaging costs.

8.3       MCNEIL shall pay all actual freight, insurance and government sales
tax imposed on purchases of finished goods for resale, and import and export
duties and other fees and costs incurred in connection with the importation,
sale and shipment of the Licensed Product to MCNEIL. Risk of loss shall belong
to MCNEIL when such goods are provided to the carrier designated by MCNEIL
responsible for transporting the Licensed Product from IMI's place of
manufacture or supply.

8.4       Payments to IMI for the Purchase Price of the Licensed Product shall
be made by MCNEIL within thirty (30) days after the earlier of (i) the date of
shipment thereof to the destination specified by MCNEIL and (ii) the date of
shipment contemplated in the original purchase order or commitment provided by
MCNEIL as contemplated in Sections 6.3 and 6.4 (if the Licensed Products are
available for shipment but MCNEIL requests that delivery be delayed for any
reason), except as to the Licensed Product orders which do not conform to the
Specifications.

                                       23

<PAGE>

         8.5    IMI and MCNEIL shall cooperate in identifying and implementing
raw material and manufacturing improvements that result in increased Licensed
Product production efficiencies and capabilities, subject to ensuring that such
improvements are in compliance with applicable regulatory and governmental
approvals and permits. ***** The Purchase Price for the Licensed Product shall
be adjusted accordingly to reflect any such cost savings/improvements and shall
be effective upon the implementation of such improvements. *****

8.6      *****

                                   ARTICLE IX

                             PACKAGING AND LABELING

9.1      All Licensed Product supplied by IMI to MCNEIL shall be in the finished
goods format as set out in the Specifications, including, but not limited to,
package sizes, shapes and formats. MCNEIL will work with IMI to develop
packaging and labeling that is suitable and in compliance with applicable
government and regulatory regulations and requirements. MCNEIL has the
discretion to establish Specifications for packaging, labeling, and finished
goods format provided that such Specifications would conform to the foregoing
regulations and requirements. MCNEIL shall be responsible for ensuring that such
Specifications are in compliance with the foregoing regulations and
requirements.

9.2      IMI agrees to mark, affix, label or otherwise use MCNEIL's trademarks,
tradenames and tradedresses on the Licensed Products and its bulk packaging in
such manner as MCNEIL may reasonably request and, in this regard, IMI is hereby
granted a non-exclusive license, sublicensable to all of IMI's manufacturers and
suppliers, to use the same for such purpose. IMI shall not use any markings,
logos, legends, labels or notices whatsoever on the Licensed Product

                                       24

<PAGE>

or its packaging except as may be authorized in advance in writing by MCNEIL.
MCNEIL shall reimburse IMI for all costs associated with matters contemplated in
this Section.

                                    ARTICLE X

                                   INSPECTION

10.1     Acceptance of the Licensed Product ordered by MCNEIL shall be subject
to inspection and approval by MCNEIL's quality assurance personnel or such other
technical representatives as MCNEIL may select, with respect to whether each
order of the Licensed Product conforms to the applicable Specifications.

10.2     MCNEIL shall, as promptly as practical, but not more than fifteen (15)
working days after actual receipt of a Licensed Product order, notify IMI of its
disapproval, if any, of samples of the Licensed Product inspected and its
non-acceptance of the Licensed Product order in the event MCNEIL is of the
opinion that a Licensed Product sample fails to conform to the Specifications.
The foregoing time period is not intended to include Licensed Product which
contains a latent defect which has not been caused by MCNEIL.

10.3     IMI shall, within thirty (30) days after it is determined that any
Licensed Product does not conform to the applicable Specifications, replace any
Licensed Product not conforming to the applicable Specifications (unless such
defect is due to any negligent or wrongful act or omission by MCNEIL or its
agents or subcontractors). If MCNEIL shall previously have paid for the Licensed
Product being replaced, then the replacement shall be at IMI's cost and expense,
including shipping costs. MCNEIL's remedy for the delivery by IMI of Licensed
Product which does not conform to the Specifications and which has not caused
damages to any third party is to require that IMI replace such Licensed Product.
If MCNEIL shall not have previously paid for the Licensed Product being
replaced, then MCNEIL shall be obliged to pay for the replacement

                                       25

<PAGE>

Licensed Product on the same terms and conditions as if originally delivered in
accordance with the Specifications. IMI shall be responsible for all costs
related to the return or destruction of the nonconforming Licensed Product.
Notwithstanding the foregoing, any non-conformance relating to the performance
of the Licensed Product in accordance with the Specifications shall be reported
to IMI within the time period set out in Section 10.2.

10.4     If MCNEIL alleges that any Licensed Product does not conform to the
applicable Specifications. it shall give written notice thereof to IMI as herein
contemplated, which notice shall contain such information as required by the
"Non-Conforming Notice" attached as Appendix L. MCNEIL shall not return any such
Licensed Product to IMI or its manufacturer except as permitted hereunder. Upon
receipt by IMI of the Non-Conforming Notice, IMI shall deliver to MCNEIL a
"returned goods authorization form" attached as Appendix M, executed by IMI,
containing instructions and directions as to the disposition of the Licensed
Product which MCNEIL alleges does not conform to the applicable Specifications.
If IMI requires that such products be returned or destroyed by MCNEIL, such
return or destruction shall be at IMI's expense including shipping costs.

10.5     MCNEIL's right to inspect and right to replacement of the Licensed
Product not conforming to applicable Specifications shall not preclude MCNEIL
from exercising or enforcing any other rights or remedies it may have to redress
any loss or damage resulting from IMI's failure to timely supply the Licensed
Product conforming to the Specifications.

                                   ARTICLE XI

                           WARRANTIES AND INDEMNITIES

11.1     IMI warrants that it has the unencumbered right to convey the rights
granted by this Agreement.

                                       26

<PAGE>

11.2     IMI warrants that all Licensed Product when supplied to MCNEIL shall
conform to and shall be produced in compliance with all relevant US FDA
requirements and with all applicable Canadian federal, provincial, and local
government and regulatory requirements and the Specifications.

11.3     IMI warrants that, to its knowledge as of the Effective Date (without
having made any additional enquiries beyond its actual knowledge), the
manufacture, importation, use and sale of the Professional Product (in its
currently intended embodiment) does not infringe the patents of any third party
in Canada.

11.4     IMI represents and warrants that the intellectual property rights
licensed or made available to MCNEIL hereunder are all intellectual property
rights owned by IMI or to which IMI has a valid license that relate to the
Licensed Technology.

11.5     IMI warrants that it has not granted any license, right or interest in
or to any Licensed Product, or any method of manufacture thereof, to any third
party relating to Licensed Products which are to be marketed in the Territory,
other than licenses for the purposes of manufacturing for IMI.

11.6     IMI agrees to indemnify and hold MCNEIL and its Affiliates harmless
against any action, claims, damages, injuries, losses, costs and expenses
(including reasonable attorney's fees and disbursements) arising from or alleged
or claimed to arise from (i) personal injury, death or property damage sustained
by any person resulting from any intentionally wrongful act or omission or sole
negligence of IMI or its employees or agents in performing services specified in
this Agreement; (ii) personal injury, death or property damage sustained by any
person resulting from use of the Licensed Product manufactured or supplied by
IMI unless such arises solely from a negligent or intentionally wrongful act or
omission by MCNEIL or its Affiliates,

                                       27

<PAGE>

employees or agents; or (iii) any material breach by IMI of its obligations or
warranties under this Agreement.

11.7 MCNEIL agrees to indemnify and hold IMI and its Affiliates harmless against
any actions, claims, damages, injuries, losses, costs and expenses (including
reasonable attorney's fees and disbursements) arising from or alleged or claimed
to arise from (i) any material breach by MCNEIL of its obligations or warranties
under this Agreement; or (ii) personal injury, death or property damage
sustained by any person resulting from any intentionally wrongful act or
omission or sole negligence of MCNEIL or its Affiliates, employees or agents.

11.8 A party seeking indemnification hereunder agrees to give prompt written
notice to the indemnifying party after the receipt of any written notice of the
commencement of any action, suit, proceeding or investigation or threat thereof
made in writing for which such party will claim indemnification pursuant to this
Agreement provided that the failure to so notify will relieve the indemnifying
party from liability to the extent it has been prejudiced by such failure.

11.9 IMI recognizes that MCNEIL and its Affiliates have been actively involved
in investments and developments in the fields of cardiac risk assessment and
cardiac health and in the investigation of entries into such fields. MCNEIL and
its Affiliates intend to continue with such activities and make no
representation or warranty that it will be able to successfully market any
Licensed Product under this Agreement or that Licensed Product will be the
exclusive means by which MCNEIL and its Affiliates may participate in these
fields. IMI agrees that the activities and services that MCNEIL undertakes under
Sections 2.4 and 2.5, the royalties provided for in Article III, and the other
covenants of MCNEIL contained in this Section 11.9, herein, are full
consideration for the licenses granted herein. Furthermore, all business
decisions including, without limitation, the sale, price and promotion of
Licensed Product in the Territory and the

                                       28

<PAGE>

decision whether to sell a particular Licensed Product shall be within the sole
discretion of MCNEIL. IMI and MCNEIL further agree that the activities and
services that MCNEIL undertakes under Sections 2.4 and 2.5 and the termination
provisions provided for under Section 17.4, herein, are in lieu of any
obligation of any specific level or standard of efforts to be used by MCNEIL in
the marketing of Licensed Products.

11.10 Except for the express warranties or representations contained in this
Agreement, each party hereby disclaims all warranties, conditions or
representations, express, implied or statutory, to the other party hereto, with
respect to any products, services, content or other materials provided by such
party hereunder relating to merchantability or fitness for a particular purpose
other than in respect of such uses and purposes as are permitted under
applicable regulatory licenses. Notwithstanding any other provision hereof,
under no circumstances shall either party be liable to the other for any
consequential, incidental, indirect, punitive or special damages arising from or
in any way out of this Agreement or the services to be provided hereunder,
however caused, whether arising under a theory of contract, tort (including
without limitation negligence) or otherwise including without limitation damages
for lost profits, revenues, business or goodwill, whether or not such party has
been advised of the possibility of such damages.

11.11 The provisions and obligations of this Article XI shall survive expiration
or any termination of this Agreement.

                                   ARTICLE XII

                                    INSURANCE

12.1  IMI shall obtain and maintain at all times during the term of this
Agreement Comprehensive General Liability Insurance, including Products
Liability, with limits of liability of not less than One Million Dollars
($1,000,000). IMI shall

                                       29

<PAGE>

provide MCNEIL with a Certificate of Insurance evidencing this coverage within
thirty (30) days following written request by MCNEIL.

                                  ARTICLE XIII

                                 PRODUCT RECALLS

13.1 In the event of a recall of the Licensed Product required by a governmental
agency or authority of competent jurisdiction or if recall of the Licensed
Product is considered by MCNEIL to be advisable, such recall shall be promptly
implemented and administered by MCNEIL in a manner which is appropriate and
reasonable under the circumstances and in conformity with accepted trade
practices. The costs of any such recall shall be borne by the party or parties
whose actions caused the recall to be necessary (provided that if the recall is
initiated by MCNEIL in circumstances where it considers that such recall is
advisable but where the recall is not suggested by governmental agency or
authority of competent jurisdiction or due to non-compliance with applicable
Specifications, the costs of such recall shall be borne by MCNEIL).

13.2 The provisions and obligations of this Article XIII shall survive any
termination of this Agreement.

                                  ARTICLE XIV

                             PATENTS AND TRADEMARKS

14.1 IMI agrees to prosecute or cause to be prosecuted the applications for
patents included in the Licensed Patents, maintain such Licensed Patents, and
defend, at its option, against any action by any third party for invalidation or
revocation of any Licensed Patent. IMI shall notify MCNEIL in the event IMI (A)
decides to abandon or discontinue the prosecution in the Territory of any patent
application included in the Licensed Patents; (B) decides not to pay the
maintenance fee in the Territory due on any patent application or patent
included in the Licensed

                                       30

<PAGE>

Patents; or (C) decides not to defend against any action by any third party for
invalidation or revocation of any patent application or patent included in the
Licensed Patents insofar as such Licensed Patents relate to the Territory. Such
notice to MCNEIL shall be sufficiently in advance of any abandonment,
discontinuance, maintenance fee due date, or response date so as to give MCNEIL
reasonable time to consider and exercise the following option:

     14.1.1 MCNEIL shall have the option, exercisable upon written notice to
     IMI, to assume full responsibility for the prosecution of the affected
     application in the Territory, to pay the maintenance fees due on the patent
     application or patent in the Territory, or to defend against such third
     party action insofar as such action relates to the Territory. In such
     circumstances, IMI agrees to assign to MCNEIL any such subject patent or
     patent application.

14.2 If IMI or MCNEIL become aware of any infringement in the Territory by a
third party of any issued patent included in Licensed Patents, that party shall
promptly notify the other party in writing to that effect. IMI shall have the
right, but not the obligation, to initiate a suit relating to such infringement.
If IMI determines to initiate such a suit, IMI shall bear all the expenses of
any suit brought by it and shall retain all damages or other moneys awarded or
received in settlement of such suit. MCNEIL will cooperate with IMI in any such
suit and shall have the right to consult with IMI and be represented by its own
counsel at its own expense.

     14.2.1 If, after the expiration of said one hundred and twenty (120) days
     from the date of said notice, IMI has not obtained a discontinuance of such
     infringement, or brought suit against the third party infringer, then
     MCNEIL shall have the right, but not the obligation, to bring suit against
     such infringer and join IMI as a party plaintiff, provided that MCNEIL
     shall bear all the expenses of such suit (and shall reimburse IMI for all
     expenses

                                       31

<PAGE>

     (excluding legal expenses) incurred by it in connection with such suit, if
     any) and shall retain all damages or other moneys awarded or received in
     settlement of such suit. Any such suit shall relate solely to the Territory
     and shall not extend to any territory outside the Territory. IMI will
     cooperate with MCNEIL in any suit for infringement in the Territory of any
     infringement of a patent of the Licensed Patents brought by MCNEIL against
     a third party, and shall have the right to consult with MCNEIL and to
     participate in and be represented by independent counsel in such litigation
     at its own expense (except as contemplated in the immediately preceding
     sentence or if IMI's involvement in such litigation is necessary as a
     result of MCNEIL having initiated the suit). MCNEIL shall incur no
     liability to IMI as a consequence of such litigation or any unfavorable
     decision resulting therefrom, including any decision holding the patent
     invalid or unenforceable.

14.3 In the event IMI or MCNEIL learn that the making, using or selling of
Licensed Product infringes, will infringe or is alleged by a third party to
infringe, in the Territory, a third party patent, the party becoming aware of
same shall promptly notify the other. IMI and MCNEIL shall thereafter attempt to
agree upon a course of action which may include: (a) modifying of the Licensed
Product or its use and manufacture so as to be non-infringing; or (b) obtaining
a license or assignment from said third party. In the event IMI or MCNEIL cannot
agree on modifying the Licensed Product pursuant to the foregoing sentence, (and
whether or not IMI or MCNEIL have received notice from a third party alleging
that the making, importing, using or selling of Licensed Product infringes or
will infringe, in the Territory, a third party patent), IMI shall in the first
instance have the right to negotiate with said third party for such license or
assignment in a territory including the Territory. In the event that such
negotiation results in a consummated agreement, then (i) all costs associated
with any lump sum payment and/or royalties to be paid

                                       32

<PAGE>

thereunder shall, when paid, be shared equally by IMI and MCNEIL and (ii) such
licensed patents shall be included in the definition of Licensed Patents only to
the extent that such licensed patents relate to the measurement of skin
cholesterol. In the event that such negotiation results in a consummated
agreement with MCNEIL, then any lump sum payment and/or royalties to be paid
thereunder shall be paid by MCNEIL, in which case MCNEIL shall set off royalties
paid to one or more of those third parties against the royalties due under
Article III, by an amount equal to the amount paid to those third parties up to
a maximum of one-half (1/2) of the royalties due IMI. If any dispute arises
between IMI and MCNEIL relating to this Section 14.3.1, MCNEIL may escrow the
set-off of royalties to be paid during the pendency of any dispute resolution.

14.4 MCNEIL and its Affiliates may advertise, promote, market and sell the
Licensed Product in the Territory under any trademark(s), tradename(s) and
tradedress of their own choosing provided that they have rights at law to use
such trademark(s), tradename(s) and tradedress. IMI shall not acquire any right,
title or interest whatsoever in or to any such trademark(s), tradename(s) or
tradedress by virtue of such use by MCNEIL and its Affiliates. So long as MCNEIL
or its Affiliates shall have any interest in and to any such trademarks,
tradenames or tradedress, whether as proprietor, owner, licensee, or licensor in
any country of the world, IMI shall not adopt, use, apply for registration,
register, own or acquire any such trademarks, tradenames or tradedress, or any
mark, name or tradedress confusingly similar thereto, in any state or country of
the world.

14.5 In the event MCNEIL or IMI learn that any MCNEIL trademark, tradename or
tradedress used in connection with the advertising, promotion, marketing or sale
of the Licensed Product in the Territory is being infringed by a third party, it
shall promptly notify the other of such infringement. MCNEIL shall exclusively
be responsible for taking any action to terminate such infringement of their
respective trademarks at their sole discretion.

                                   ARTICLE XV

                                 CONFIDENTIALITY

15.1 Disclosures of confidential information hereunder by either party to the
other shall be made in writing (or confirmed in writing within one month if made
in another form), and shall be clearly marked "Confidential". Such confidential
information shall be safeguarded by the

                                       33

<PAGE>

recipient, shall not be disclosed to third parties and shall be made available
only to recipient's employees or independent contractors who agree in writing to
conditions equivalent to those in this Article XV and who have a need to know
the information for the purposes specified under this Agreement, subject to the
provisions of Section 15.3. All confidential information shall remain the
property of and be returned to the disclosing party within thirty (30) days of
receipt of a written request by the disclosing party, or within thirty (30) days
of termination of this Agreement. However, each party's counsel may retain one
copy of these documents for archival purposes to be used to monitor compliance
herewith and in respect of any litigation relating to the provisions of this
Agreement including the provisions of this Article. All confidential information
shall only be used for the purposes contemplated in this Agreement. These mutual
obligations of confidentiality shall not apply to any information that:

          (i)   is or hereafter becomes generally available to the public other
     than by reason of any default with respect to a confidentiality obligation
     by the recipient to the disclosing party; or

          (ii)  was already known to the recipient as evidenced by prior written
     documents in its possession; or

          (iii) is disclosed to the recipient by a third party who is not in
     default of any confidentiality obligation to the disclosing party
     hereunder; or

          (iv)  is developed by or on behalf of the receiving party, without
     reliance on confidential information received hereunder; or

          (v)   has been approved in writing for publication by each of the
     parties.

15.2 Notwithstanding the restrictions of Section 15.1 hereinabove, IMI and
MCNEIL may disclose such portions of the confidential information that:

                                       34

<PAGE>

          (i)   are provided to third parties under appropriate terms and
     conditions including confidentiality provisions equivalent to those in this
     Agreement for consulting, manufacturing development, manufacturing,
     external testing and marketing trials with respect to the Licensed
     Products; or

          (ii)  are used with the consent of the disclosing party (which consent
     shall not be reasonably withheld) in applications for patents or copyrights
     under, and as specifically permitted under, the terms of this Agreement; or

          (iii) are required to be disclosed in compliance with applicable laws
     or regulations in connection with the manufacture or sale of Licensed
     Products; or

          (iv)  are otherwise required to be disclosed in compliance with
     applicable laws or regulations or order by a court or other regulatory body
     having competent jurisdiction; or

          (v)   are product-related information that is reasonably required to
be disclosed in connection with marketing of Licensed Products.

In making such disclosures under this Section 15.2 (other than pursuant to
subsection (i) thereof), the disclosing party shall obligate the recipient to
secrecy, if possible.

15.3 Notwithstanding the restrictions of Section 15.1 hereinabove, MCNEIL and
IMI may disclose confidential information to their employees, consultants,
advisors and subcontractors who are engaged directly or indirectly in the
manufacture, use or sale of the Licensed Product who have first been instructed
to maintain such confidential information in confidence and who have agreed in
writing to conditions equivalent to those in this Article XV. For the avoidance
of doubt, however, MCNEIL and IMI shall be free to disclose the existence of
this Agreement and

                                       35

<PAGE>

the nature of the licenses granted hereunder to its Affiliates and prospective
sublicensees with an appropriate obligation of confidentiality and non-use.

15.4 With respect to information disclosed on or after the Effective Date
between MCNEIL and IMI under the provisions of this Agreement, the provisions of
the Agreement shall govern and prevail. In the event of any conflict between
this Agreement and the Confidentiality Agreement, with respect to information
disclosed on or after the Effective Date, the terms of this Agreement shall
govern and prevail.

15.5 The conditions and restrictions of this Article XV shall remain in force
during the term of this Agreement and for ten (10) years thereafter, surviving
the termination of this Agreement.

                                  ARTICLE XVI

                            CONTRACTUAL RELATIONSHIP

16.1 The relationship of the parties under this Agreement is that of independent
contractors and not as agents of each other or partners or joint venturers, and
neither party shall have the power to bind the other in any way with respect to
any obligation to any third party unless a specific power of attorney is
provided for such purpose. Each party shall be solely and exclusively
responsible for its own employees and operations.

                                  ARTICLE XVII

                              TERM AND TERMINATION

17.1 This Agreement shall become effective upon the Effective Date. The
Agreement shall remain effective, subject to any renewals, in full force and
effect until it expires on the day following the fifteenth (15th) anniversary of
the Effective Date unless earlier terminated in accordance with any of the
provisions of this Article XVII.

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<PAGE>

17.2 This Agreement may be renewed for an additional five (5) year period,
unless earlier terminated in accordance with any of the provisions of this
Article XVII. The parties will complete the negotiation of terms for such
renewal at least 180 days prior to the expiration of this Agreement.

17.3 MCNEIL may terminate this Agreement at any time prior to MCNEIl's first
     commercial sale of Licensed Product in the Territory upon thirty (30) days
     prior written notice to IMI and thereafter, upon ninety (90) days prior
     written notice to IMI.

17.4 IMI may terminate:

       17.4.1 the provisions of this Agreement relating to the Professional
              Field if:

              i)     by the first anniversary of the Effective Date, MCNEIL has
                     not had any Net Sales of any Licensed Product in the
                     Professional Field or Territory, or

              ii)    in any subsequent calendar year commencing after the first
                     anniversary of the Effective Date, MCNEIL has not had Net
                     Sales of any Licensed Product in the Professional Field in
                     the Territory of at least *****.

              iii)   at any time MCNEIL or any of its Affiliates is marketing or
                     otherwise distributing in the Professional Field in the
                     Territory a cardiac risk predictor that measures skin
                     cholesterol,
                     whereupon Licensed Fields, as defined in Section 1.1 above,
                     will exclude the Professional Field;

       17.4.2 the provisions of this Agreement relating to the Consumer Field
              if:

              i)     by the first anniversary of the date upon which IMI
                     receives regulatory approval for the marketing of the a
                     Licensed Product in the Consumer Field, MCNEIL has not had
                     any Net Sales of any Licensed Product in the Consumer
                     Field in the Territory, or

              ii)    in any subsequent calendar year commencing after the first
                     anniversary of the Effective date, MCNEIL has not had Net
                     Sales of any Licensed Product in the Consumer Field in the
                     Territory of at least *****, or

              iii)   at any time MCNEIL or any of its affiliates is marketing or
                     otherwise distributing in the Consumer Field in the
                     Territory a cardiac risk predictor that measures skin
                     cholesterol;
                     whereupon Licensed Fields, as defined in Section 1.1 above,
                     will exclude the Consumer Field,

       17.4.3 the provisions of this Agreement relating to the Nutraceutical
              Field if:

              i)     by the first anniversary of the date upon which IMI
                     receives regulatory approval for the marketing of the a
                     Licensed Product in the Consumer Field, MCNEIL has not had
                     any Net Sales of any Licensed Product in the Nutraceutical
                     Field in the Territory, or

              ii)    in any subsequent calendar year commencing after the first
                     anniversary of the Effective Date, MCNEIL has not had Net
                     Sales of any Licensed Product in the Consumer Field in the
                     Territory of at least *****, or

              iii)   at any time MCNEIL or any of its Affiliates is marketing or
                     otherwise distributing in the Nutraceutical Field in the
                     Territory a cardiac risk predictor that measures skin
                     cholesterol;
                     whereupon Licensed Fields, as defined in Section 1.1 above,
                     will exclude the Nutraceutical Field; or

       17.4.4 the provisions of this Agreement relating to the Laboratory Field
              if:

              i)     in any year (and in succeeding years) ending on the
                     anniversary of the date on which the option contemplated in
                     Section 3.2 is exercised, MCNEIL has not had Net Sales of
                     at least ***** related to any Licensed Product in the
                     Laboratory Field in the Territory, or

              ii)    at any time MCNEIL or any of its Affiliates is marketing or
                     otherwise distributing in the Laboratory Field in the
                     Territory a cardiac risk predictor that measures skin
                     cholesterol;
                     whereupon Licensed Fields, as defined in Section 1.1 above,
                     will exclude the Laboratory Field (notwithstanding any
                     other provision hereof including, without limitation,
                     Section 3.2).

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<PAGE>

17.5 IMI may terminate this Agreement, except as limited hereinafter,
immediately upon written notice, in the event:

     17.5.1 MCNEIL fails to make any payment due and owing within fifteen (15)
     days after notice thereof; or

     17.5.2 MCNEIL commits a breach of any material provision of this Agreement
     that is not cured within sixty (60) days after notice thereof if such
     breach is curable.

17.6 MCNEIL may terminate this Agreement immediately upon written notice in the
event IMI commits a breach of any material provision of this Agreement which is
not cured within sixty (60) days after notice thereof.

17.7 The rights of termination set forth in Sections 17.5 and 17.6 hereinabove,
however, cannot be exercised by IMI or MCNEIL, as the case may be, if at any
time during said sixty (60) day period, MCNEIL or IMI, as the case may be,
advises the other party in writing that it challenges the alleged payment owed
or the alleged breach. In such event, the parties will negotiate in good faith
to resolve the dispute concerning the alleged payment owed or the alleged
breach.

17.8 Either party may terminate this Agreement if the other party is declared
insolvent or bankrupt by a court of competent jurisdiction, or files a voluntary
petition of bankruptcy in any court of competent jurisdiction, or shall make or
execute an assignment of substantially all its assets for the benefit of
creditors. However, the parties agree that IMI has transferred exclusive,
proprietary rights and interest in the Licensed Patents in the Territory to
MCNEIL under this Agreement.

17.9 Termination of this Agreement for any cause shall not release either party
from any obligation theretofore accrued.

                                       38

<PAGE>

17.10 The failure on the part of either party to exercise or enforce any right
conferred upon it hereunder shall not be deemed to be a waiver of any such
right, or any other right conferred hereunder, nor operate to bar the exercise
or enforcement thereof at any time thereafter.

17.11 Upon termination of this Agreement for any reason,

      17.11.1 IMI shall fill all binding orders of MCNEIL for the Licensed
      Product which were placed prior to the date of notice of termination given
      by IMI pursuant to this Agreement (or place prior to the effective date of
      the termination if notice is given by MCNEIL hereunder), unless otherwise
      instructed by MCNEIL; and -.

      17.11.2 MCNEIL shall have the right to sell any Licensed Product in its
      inventory provided MCNEIL pays to IMI the applicable royalty, if any. This
      Section 17.11 shall survive termination or expiration of this Agreement.

                                 ARTICLE XVIII

                            MISCELLANEOUS PROVISIONS

18.1  The rights and obligations of IMI and MCNEIL under this Agreement are
personal thereto and neither party shall have the right to sublicense, assign,
transfer or delegate, in whole or in part, any of its rights or obligations
hereunder to any third party without the prior written consent of the other
party except that either party may assign this Agreement to any Affiliate
provided that the assignor guarantees all of the covenants and obligations of
such Affiliate arising pursuant to such assignment.

18.2  {intentionally deleted}

18.3  Notwithstanding Section 18.1, MCNEIL shall have the right to sublicense
all or part of its rights and obligations under this Agreement only to its
Affiliates (which shall not have the right to further sublicense such rights and
obligations) upon sixty (60) days prior written notice to IMI,

                                       39

<PAGE>

provided that in any event MCNEIL guarantees all of the covenants and
obligations of such Affiliate arising pursuant to such sublicense.

18.4  The illegality, invalidity, or otherwise voidability or unenforceability
of any provision of this Agreement shall not impair, affect or invalidate the
other provisions of this Agreement. In the event that any part, section, clause,
paragraph or subparagraph of this Agreement shall be held to be indefinite,
invalid, illegal or otherwise voidable or unenforceable, the entire agreement
shall not fail on account thereof, and the balance of the Agreement shall
continue in full force and effect. The parties shall replace such illegal or
invalid provisions with a valid and enforceable provision which most closely
approaches the idea, intent, and purpose of this Agreement, and in particular,
the provision to be replaced.

18.5  Any notice required or permitted under this Agreement shall be deemed to
have been sufficiently provided and effectively made (i) as of the delivery date
if hand-delivered in person or by a reputable courier service, (ii) as of the
delivery date if delivered by facsimile transmission (provided that if the
transmission occurs on a day other than a day on which the main branches of
chartered banks are open for business in the City of Toronto or after 5:00 p.m.
on any day, then the facsimile transmission shall be deemed to be delivered on
the next day on which such branches are open for business in the City of
Toronto), or (iii) as of the fifth day following the mailing date if mailed by
registered mail, postage-prepaid, and addressed to the receiving party at the
following respective address:

MCNEIL PDI INC.
MCNEIL CONSUMER HEALTHCARE
890 Woodlawn Road West
Guelph, Ontario
NIK lA5
Attn:  President
Facsimile:  519-826-6302

                                       40

<PAGE>

With a copy to:
JOHNSON & JOHNSON
One Johnson & Johnson Plaza
New Brunswick, NJ 08933
Attn:  Chief Patent Counsel
Facsimile:    732-524-2808

IMI INTERNATIONAL MEDICAL INNOVATIONS INC.
Suite 300
4211 Yonge Street
Toronto, Ontario
M2P 2A9
Canada
Attn:  Chief Financial Officer
Facsimile:    (416) 222-4533

or such other address which the receiving party has given notice pursuant to the
terms of this Section 18.5.

18.6 Neither party shall, without the other party's prior written consent, make
any announcement or other disclosure regarding this Agreement or that any
business relationship exists between the parties except as may be required
pursuant to applicable securities legislation (as interpreted and advised in
good faith by counsel to the disclosing party).

18.7 This Agreement represents the entire understanding between MCNEIL and IMI,
and supersedes all other understandings and agreements, express or implied, not
specifically referenced and incorporated herein, concerning the Licensed
Product. Any modification of this Agreement to be effective must be in writing,
specifically refer to this Agreement, and be signed by both parties.

18.8 Any delays in or failures of performance by a party under this Agreement
shall not be considered a breach of this Agreement if and to the extent caused
by occurrences beyond the reasonable control of the party affected, including
but not limited to: acts of terrorism, acts of God; acts, regulations or laws of
any government; strikes or other concerted acts of workers;

                                       41

<PAGE>

fires; floods; explosions; riots; wars; rebellions; and sabotage; and any time
for performance hereunder shall be extended by the actual time of delay caused
by such occurrence.

18.9  This Agreement shall be interpreted and applied in accordance with the
laws of the Province of Ontario, Canada. The parties hereby irrevocably attorn
to the non-exclusive jurisdiction of the courts of such province.

18.10 Il est convenu par le present acte que les deux parties demandent que ce
contrat et tout avis, consentement, autorisation, communication et approbation
soient rediges en langue anglaise. It is hereby agreed that both parties
specifically require that this Agreement and any notices, consents,
authorizations, communications and approvals be drawn up in the English
language.

18.11 The parties agree that time shall not be of the essence of this Agreement
or any matter contemplated herein other than the provisions of Article XV II.

IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the day
and year first written above.

McNEIL PDI INC.

(acting through its McNEIL Consumer Healthcare
division on behalf of McNeil PDI Inc.)

By: /s/ Jerry Norsky
    --------------------------------
    Name: Jerry R. Norsky
    Title: President
    Authorized Signing Officer

IMI INTERNATIONAL MEDICAL INNOVATIONS INC.

By: /s/ Brent Norton
   ---------------------------------

                                       42

<PAGE>

     Name: B. Norton
     Title:President and C.E.O.
     Authorized Signing Officer

                                       43

<PAGE>

                                   APPENDIX A

               Clinical Development Program for Cholesterol 1,2,3
                               Professional System

Clinical Trials in Progress

     1.   Non-Invasive Evaluation of Skin Cholesterol Levels with Avasimibe
          Therapy (A-Plus)
               .    250 patients, 10 sites
               .    Assess the effect of Avasimibe on Cholesterol 1,2,3 values
                    over time
     2.   To Determine Whether Skin Cholesterol Can be Used to Measure
          Compliance with Statin Therapy (Statin Compliance)
               .    100 patients, 1 site (The Cleveland Clinic Foundation,
                    Cleveland, Ohio)
               .    To determine if Cholesterol 1,2,3 can monitor a response to
                    statin therapy
     3.   Multi-Ethnic Study of Atherosclerosis (MESA)
               .    6500 patients, 6 sites (Currently Cholesterol 1,2,3 is used
                    at only one site (John's Hopkins) but may be expanded to
                    others)
               .    To assess ethnic, age, and gender differences in subclinical
                    disease prevalence, risk of disease progression and clinical
                    CVD
     4.   To Determine whether Skin Cholesterol Measurement in Children with
          Hyperlipidemia is Elevated (Pediatric)
               .    50 patients, I site (St. Joseph's Hospital, Hamilton
                    Ontario)
               .    To determine if' hyperlipidemic children have higher skin
                    cholesterol levels than nomolipidemic children
     5.   Non-Invasive Evaluation of Skin Cholesterol levels with Warfarin
          Therapy (Wave)
               .    200 patients, I site (The Hamilton General Hospital,
                    Hamilton, Ontario
               .    Patients are placed on Warfarin therapy. Skin Cholesterol is
                    tested at baseline and after one and 2.5 years to see
                    whether skin cholesterol can predict cardiac events

--------------------------------------
Trials under IMI's Control
  .  Statin Compliance - In Progress
     (degree)Completed Q3/2002
     (degree)Results Q4/2002
  .  Pediatric - In Progress
     (degree)Completed Q3/2002
     (degree)Results Q4/2002
  .  Wave - In Progress
     (degree)Completed Q2/2003
     (degree)Results Q3/2003
--------------------------------------

--------------------------------------
Trials not under IMI's Control
  .  A-Plus-In Progress
     (degree)Completed Q3/2003
     (degree)Results Q4/2003
  .  MESA - In Progress
     (degree)Completed 2010
     (degree)Results 2010
--------------------------------------

                                       44

<PAGE>

                                   APPENDIX B

               Skin Cholesterol Consumer Product Development Plan

          *****

                                       45

<PAGE>

                                   APPENDIX B

               Skin Cholesterol Consumer Product Development Plan

Products Under Development

*****

                                       46

<PAGE>

                                   APPENDIX C

                          IMI Patent Estate and Status

<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
Patent         Official Filing Title              Inventors          Jurisdiction   Patent        Filing Date         Expiry Date
Status                                                                              Number
------------------------------------------------------------------------------------------------------------------------------------
<S>       <C>                               <C>                     <C>            <C>         <C>                 <C>
Granted   Method for Visual Indication of   Jury M. Lopukhin,       United States  5,489,510   Feb 9, 1993         Feb 6, 2013
          Cholesterol on Skin Surface       Viktor V. Zuevsky,
          Agents Used Therefore and         Alexander B. Rabovsky,
          Methods for Producing             Irina P. Andrianov
------------------------------------------------------------------------------------------------------------------------------------
Granted   Method for Producing              Jury M. Lopukhin,       United States  5,587,295   July 19, 1994       Dec 24, 2013
          Affino-enzymatic Compounds and    Viktor V. Zuevsky,
          Visualizing Agent and             Alexander B. Rabovsky,
          Application Thereof               Irina P. Andrianov
------------------------------------------------------------------------------------------------------------------------------------
Granted   Method for Producing              Jury M. Lopukhin,       Canada         1,335,968   January 19, 1989    June 20, 2012
          Affinity-enzymatic Compounds for  Viktor V. Zuevsky,
          Visual Indication of Cholesterol  Alexander B. Rabovsky,
          on Skin Surface                   Irina P. Andrianov
------------------------------------------------------------------------------------------------------------------------------------
Granted   Method of Producing               Jury M. Lopukhin,       Europe         0 338 189   January 19, 1988    April 24, 2013
          Affinity-enzymatic Compounds for  Viktor V. Zuevsky,
          the Visual Detection of           Alexander B. Rabovsky,
          Cholesterol on the Surface of     Irina P. Andrianov
          the Skin of a Patient based on a
          Detecting Agent with any
          Affinity for Cholesterol and a
          Visualizing Agent
------------------------------------------------------------------------------------------------------------------------------------
Granted   Multilayer Analytical Element     Alexander M. Maleev     Australia         702663   December 14, 1995   December 14, 2015
------------------------------------------------------------------------------------------------------------------------------------
Granted   Multilayer Analytical Element     Alexander M. Maleev     Korea          97-704028   December 14, 1995   December 14, 2005
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

                                       47

<PAGE>

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------------
Patent        Official Filing Title           Inventors          Jurisdiction     Patent      Filing Date        Expiry Date
Status                                                                            Number
-----------------------------------------------------------------------------------------------------------------------------
<S>        <C>                            <C>                    <C>           <C>          <C>                <C>
Granted    Method of Determining Skin     Alexander S. Parfenov   USA          6,365,363    August 20, 1999    April 2, 2019
           Tissue Cholesterol             Jury M. Lopukhin
-----------------------------------------------------------------------------------------------------------------------------
Pending    Multilayer Analytical Element  Alexander M. Maleev    PCT           CA95/00698   December 14, 1995  N/A
                                                                 Brazil        PI95/0038-5
                                                                 Canada        2,207,555
                                                                 China         95197367.3
                                                                 Europe        95940097.9
                                                                 Japan         HE1-8-57984
                                                                 Mexico        974469
                                                                 USA           08/849,252
-----------------------------------------------------------------------------------------------------------------------------
Pending    *****                          Alexander S. Parfenov  PCT           RU98/00010   January 26, 1998   N/A
                                          Jury M. Lopukhin       Brazil        PI9807594-2
                                                                 Europe        98901608.4
                                                                 Japan         10-536529
                                                                 Canada        2281769      February 20, 1997
                                                                 Russia        97102570
-----------------------------------------------------------------------------------------------------------------------------
Pending    *****                          Michael Evelegh        PCT           CA00/00918   August 4, 2000     N/A
                                                                 Australia
                                                                 Brazil        PI0013096-6
                                                                 China
                                                                 Europe        00954181.4
                                                                 India
                                                                 Japan         2001-515964
                                                                 Russia
                                                                 USA           09/830708
-----------------------------------------------------------------------------------------------------------------------------
</TABLE>

                                       48

<PAGE>

                                   APPENDIX D

                              IMI Trademark Status

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------
   Pending               Mark                 Date Filed          Application #         Status
---------------------------------------------------------------------------------------------------
<S>                 <C>                       <C>                <C>                   <C>
Canada              Cholesterol 1,2,3         02/22/2000            1,047,894           Granted
---------------------------------------------------------------------------------------------------
United States       Cholesterol 1,2,3         03/21/2000            76/006,213          Pending
---------------------------------------------------------------------------------------------------
European Union      Cholesterol 1,2,3         07/10/2000            001747344           Granted
---------------------------------------------------------------------------------------------------
</TABLE>

<PAGE>

                                   APPENDIX E

                       Professional Product Specifications

     *****

                                       50

<PAGE>

                                      *****
                                   APPENDIX J
                    J&J Corporate Quality Systems Regulations

     *****

                                       51

<PAGE>

                                   APPENDIX K

                        Price Schedule for X-Rite Reader

                                      *****

                                       52

<PAGE>

                                   APPENDIX L

                           Statement of Non-Conformity

     *****

                                       53

<PAGE>

                                   APPENDIX M

                          Returned Goods Authorization

To: McNeil Consumer Healthcare

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------

                                           Product
    Quantity         Product Code        Description       Lot #       Details          Action/Disposition

--------------------------------------------------------------------------------------------------------------
<S>                  <C>                 <C>               <C>         <C>              <C>

--------------------------------------------------------------------------------------------------------------
</TABLE>

Description of Action Required

Authorized By:

Date:  ____________

                                       54

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