Document:

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                                  Exhibit 10.8

                           EXCLUSIVE LICENSE AGREEMENT

         This Exclusive License Agreement ("Agreement") is entered into as of
the 30th day of April, 1999 (the "Effective Date"), by and among OxyNet, Inc.,
an Ohio corporation ("OxyNet"), NetMed, Inc., an Ohio corporation ("NetMed"),
and MG Generon, Inc., a Delaware corporation ("Generon"). RECITALS

         OxyNet is a majority-owned subsidiary of, and controlled by, NetMed.
OxyNet and NetMed represent that OxyNet owns and/or has exclusively licensed
certain technology, including patent rights, trade secrets, know-how,
confidential information and other intellectual property relating to the removal
or separation of oxygen from air and other gases. OxyNet desires to grant and
Generon desires to obtain and receive an exclusive right and license to develop,
make, use, sell, offer for sale, import, lease and otherwise dispose of products
and provide services incorporating or employing such technology and otherwise
commercially exploiting such technology.

         Therefore, in consideration of the foregoing and the mutual terms set
forth herein, and intending to be legally bound hereby, the parties agree as
follows:

         1. DEFINITIONS
            -----------

            1.1 "Ambient Air" means a gas having a composition consisting
approximately of twenty-one percent (21%) oxygen, seventy-nine percent (79%)
nitrogen and traces of other gases at one (1) atmosphere of pressure.

            1.2 "CeramPhysics License" means that certain License Agreement
dated February 28, 1997 between OxyNet and CeramPhysics, Inc., as amended by an
Amendment To License Agreement dated March 31, 1998,

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            1.3 "Confidential Information" means all knowledge and information,
whether written or unwritten, of or pertaining to this Agreement and the
transactions and Project contemplated hereby, the Technology, OxyNet, NetMed or
Generon, and any and all trade secrets, know-how, methodologies, formulae,
plans, inventions, drawings, discoveries, concepts and ideas, whether or not
patentable or copyrightable, of or relating to any of the foregoing; the nature
and results of any research and/or development activities, including products,
applications, methods and services relating to, used or useful in connection
with any of the foregoing or the commercial exploitation thereof, methods,
techniques and strategies used or useful in manufacturing, developing and/or
marketing products or services; non-public information; and existing or
prospective customer lists and requirements, customer data, pricing matters and
marketing techniques.

            1.4 "Continuation" means, with respect to patents and patent
applications, a refiling of a specification filed in a prior patent application
for which priority is claimed, in whole or in part, with or without the presence
of new matter or of matter or claims divided from the prior patent application,
and without regard to whether or not a patent has matured from the prior patent
application.

            1.5 "Deoxification Applications" means (a) use of the Technology to
remove oxygen from inert gases where the intended and primary product is the
purer inert gas, including use of the Technology alone or in conjunction with
Generon's membrane or other technology for these purposes; (b) use of the
Technology in connection with Generon's on-site membrane gas generation systems,
including the use of purifying the "oxygen waste air stream"; and (c) so long as
the primary purpose of the use of the Technology is for removing oxygen from a
gas which is being purified, use of the Technology to purify the oxygen waste
stream, provided, however, that

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Generon may only use the technology in conjunction with its on-site membrane
systems for this purpose.

            1.6 "Gross Selling Price" or "List Selling Price" mean in either
case the cash consideration received by Generon in respect of the sale, lease or
other disposition of Units.

            1.7 "Licensed Methods" means methods relating to the removal,
separation and/or generation of oxygen from air and/or other gases (including
Ambient Air) which, in the absence of this Agreement, would infringe at least
one claim of the Licensed Patents or use the Licensed Technology.

            1.8 "Licensed Patents" means U.S. Patent No. 5,205,990 issued on
April 27, 1993 and licensed exclusively to OxyNet, entitled "Oxygen Generator
Having Honeycomb Structure" and any patents which may issue from such
applications and any Continuations of any of the foregoing, all patents issued,
reissued, reexamined, renewed and extended from any of the foregoing, and all
counterparts (i.e., corresponding foreign applications and patents) and
equivalents (i.e., statutorily protected or designated with the status of an
invention, characterized as other than a patent application or patent) of any of
the foregoing filed, licensed or issued in any country of the world, which are
or were filed, licensed, owned (legally or beneficially, in whole or in part) or
acquired at any time during the Term of this Agreement by OxyNet or NetMed
relating to the removal, separation and/or generation of oxygen from air and/or
other gases (including Ambient Air). Any Licensed Patents additional to those
specified by patent number or serial number above will be added to Schedule A
attached to and incorporated herein. 1.9 "Licensed Products" means any system or
apparatus which, in the absence of this Agreement, would infringe at least one
claim of the Licensed Patents or use the Licensed Technology.

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            1.10 "Licensed Technology" means OxyNet's and/or NetMed's technology
(including the Licensed Patents, patents, patent applications, reissues and
Continuations, know-how, Confidential Information, trade secrets, manufacturing
methods, drawings, laboratory notes and other information however embodied or
expressed (and whether oral, in writing or stored on machine-readable media such
as magnetic tapes, compact discs or other means)) relating to, used or useful in
the removal, separation and/or generation of oxygen from air and/or other gases
(including Ambient Air).

            1.11 "Licensed Territory" means any and all countries of the world.

            1.12 "Unit or Units" means that portion of a Licensed Product which
contains only the ceramic membrane and associated controls and does not include
any other gas separation or generation equipment or other product.

         2. GRANT
            -----

            2.1 EXCLUSIVE LICENSE. OxyNet hereby grants to Generon an exclusive
(including as to OxyNet and NetMed) license under the Licensed Patents and
Licensed Technology to develop, make, have made, market, use, sell, offer for
sale, lease, import, distribute and otherwise dispose of Licensed Products and
to practice Licensed Methods in the Licensed Territory in Deoxification
Applications. The foregoing grant shall automatically include any activity which
is designated by law as patent infringement in any country in which a Licensed
Patent is in force.

                  2.2 SUBLICENSE. Generon's exclusive license granted herein
includes the right to sublicense the Licensed Patents and Licensed Technology.
Without limiting the generality of the foregoing, Generon shall have the right
to license or sublicense the right to practice the Licensed Methods to end users
of Licensed Products.

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            2.3 EXCLUSIVITY. The licenses granted herein shall be exclusive,
even as to OxyNet and NetMed in all countries of the world.

         3. ROYALTY
            -------

            3.1 PAYMENTS. Generon shall pay to OxyNet a royalty of [*] of the
Gross Selling Price or the List Selling Price, which ever amount is greater, in
respect of each Unit. Generon will develop and provide List Selling Prices to
OxyNet when the Units become available for sale. The List Selling Prices will be
at a minimum [*] above the variable manufacturing cost (materials and labor) of
the Units. Generon will have the right to adjust the List Selling Prices on an
annual basis as it sees fit and submit the revised List Selling Prices to
OxyNet. Royalties shall be due and payable forty-five (45) days after the date
of shipment of the Unit to the end user.

         4. ACCOUNTING RECORDS, PAYMENT
            ---------------------------

            4.1 ACCOUNTING AND RECORDS. Generon shall keep accurate records of
the revenue and sales price of all Units sold, leased or disposed of by or for
Generon. OxyNet shall have the right to have Generon's records bearing on its
activities under this Agreement audited by a mutually acceptable firm of
independent accountants provided that such firm shall have theretofore executed
and delivered to Generon a confidentiality and non-disclosure agreement in form
and scope reasonably satisfactory to Generon.

* Portion has been omitted pursuant to a request for confidential treatment and
  filed separately with the Commission

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         5. PATENT MARKETING
            ----------------

                  Generon shall mark or label the Licensed Products with the
patent numbers of any of the Licensed Patents issued before Generon installs,
sells, leases, or disposes of any of the Licensed Products to a third party
after the Effective Date of this Agreement.

         6. WARRANTIES DISCLAIMERS AND INDEMNIFICATION
            ------------------------------------------

            6.1 REPRESENTATIONS AND WARRANTIES. OxyNet and NetMed, jointly and
severally, represent and warrant to Generon, as of the Effective Date, that:

            6.1.1 OxyNet is sole and exclusive owner or licensee of the
identified Licensed Patents and Licensed Technology has the power to enter into
this Agreement and to grant the licenses granted herein to Generon, and no
consent of any other person or entity is required therefor;

            6.1.2 Neither OxyNet nor NetMed is aware of any information which is
material to the patentability or validity of a Licensed Patent which has not
been brought to the attention of the official patent office of each country in
which a Licensed Patent has been examined or re-examined;

            6.1.3 Neither OxyNet nor NetMed is engaged in any (and knows of no
pending or threatened) claims, actions, suits, or proceedings relating to the
Licensed Patents. OxyNet and NetMed will give immediate written notice to
Generon of any such event which becomes known to it during the term of this
Agreement;

            6.1.4 Neither OxyNet nor NetMed is a party to any existing agreement
with any other party that conflicts with this Agreement or the licenses granted
herein to Generon; and

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             6.1.5 Neither OxyNet nor NetMed has any knowledge or reason to
believe that the Licensed Products or Licensed Methods infringe any patent or
rights or make use of any trade secrets of any third party.

         6.2 RESERVATION TO MODIFY. This Agreement shall not constitute an
acknowledgment, agreement or acquiescence by Generon that any Licensed Patent or
portion thereof is valid or infringed. Generon reserves the right at any time to
modify its technology with respect to the removal, separation and/or generation
of oxygen from air and/or other gases (including Ambient Air) or any other
matter. Without limiting the generality of the foregoing, Generon shall be free
to manufacture, have manufactured, market, use, lease, sell, import, distribute
and otherwise dispose of devices which perform the same function as the Licensed
Products or Units without any duty on its part to prefer the Licensed Products
or Units in any way or to maximize royalties hereunder, provided that such
devices do not in any way incorporate, use or practice the Licensed Technology,
except to the extent expressly permitted hereunder.

         7. OXYNET OBLIGATION TO PROSECUTE AND MAINTAIN
            -------------------------------------------

            Subject to the provisions of the CeramPhysics License, OxyNet shall
be obligated to continue to prosecute and maintain the Licensed Patents. OxyNet
shall keep Generon timely informed as to the prosecution and maintenance of the
Licensed Patents. If at any time Generon determines that OxyNet is not
performing its obligation to prosecute or maintain. the Licensed Patents under
this Section 7, Generon has the right to assume control of (and OxyNet agrees to
assist Generon with) such patent prosecution or maintenance. If Generon should
elect to take over the prosecution or maintenance of the Licensed Patents under
this Section 7, Generon shall be permitted (and OxyNet hereby consents to allow
Generon) to deduct all such reasonable expenses from allocations, dividends,
distributions, or payments due or payable from Generon.

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         8. LITIGATION
            ----------

            8.1 INFRINGEMENT BY THIRD PARTIES. In the event of third party
infringement of a Licensed Patent, Generon shall have the first right and
discretion to take actions (including filing a lawsuit) for the abatement of
such infringement. OxyNet agrees to cooperate and reasonably assist with
Generon's efforts to abate any infringement, including consenting to joinder as
a plaintiff. In any such litigation, Generon shall control all aspects of the
action and shall have the right to settle such litigation by granting a
non-exclusive license under the Licensed Patents. Any award, settlement, license
fees or recovery shall be retained by Generon.

         9. OXYNET IMPROVEMENTS
            -------------------

            From time to time OxyNet may make modifications, enhancements, or
improvements to the Licensed Products or Licensed Methods ("OxyNet
Improvements"). OxyNet will grant and hereby grants to Generon a royalty free
license to Generon to use, sale, lease, sublicense or otherwise practice such
OxyNet Improvements, including Confidential Information, now existing or
developed during the term of this Agreement and to include such OxyNet
Improvements as part of such Licensed Technology under the terms of this
Agreement.

         10. TERM AND TERMINATION
             --------------------

             10.1 The term of this Agreement shall commence on the Effective
Date hereof, and shall continue in effect for so long as any claim in any of the
Licensed Patents is valid and subsisting, unless terminated earlier as provided
below.

             10.2 This Agreement may be terminated by mutual, written agreement
of the parties.

             10.3 This Agreement may be terminated if a party to this Agreement
commits a material breach of any material provision herein. upon written notice
to the defaulting party and

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such default is not cured within ninety (90) days of such notice, provided,
however, that if such default is of a kind which cannot reasonably be cured
within ninety (90) days, such period shall be extended for up to an additional
ninety (90) days so long as the defaulting party is diligently and in good faith
pursuing the cure thereof.

         11. EFFECT OF TERMINATION AND EXPIRATION
             ------------------------------------

             11.1 EFFECT OF TERMINATION. The license granted herein to Generon
may terminate upon early termination of this Agreement due to a Generon material
breach as set forth in Section 10, except that Generon shall have the right
thereafter to sell or lease its inventory of Licensed Products remaining on the
date of the termination.

             11.2 SURVIVAL. Sections 6, 7, 8, 12 and 13 shall survive expiration
or termination of this Agreement.

         12. DISPUTES
             --------

             12.1 In the event of any controversy or claim arising out of or
relating to this Agreement, a party shall provide written notice of the
controversy or claim to the other party, and the parties shall attempt to
resolve such controversy or claim informally. If the parties are unable to
resolve a claim informally for a period of sixty (60) days after written notice,
the parties shall be free to pursue arbitration as provided hereinafter.

             12.2.1 All claims and controversies, whether based in contract,
tort or otherwise, arising out of or relating to this Agreement or the scope,
breach, termination or validity of this Agreement and including any claim or
dispute concerning a party's right to indemnification (a "Claim"), shall be
submitted to binding arbitration in accordance with the following provisions.
Arbitration shall be the sole and exclusive remedy of the Parties in connection
with any Claims hereunder.

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             12.2.2 The Party desiring to initiate arbitration in connection
with any Claim shall send, via certified mail, written notice of demand of
arbitration to the other Party and the name of the arbitrator appointed by the
Party demanding arbitration together with a statement of the matter in
controversy.

             12.2.3 Within fifteen (15) days after receipt of such demand, the
receiving Party shall name its arbitrator. If the receiving Party fails or
refuses to name its arbitrator within such 15-day period, the second arbitrator
shall be appointed, upon request of the Party demanding arbitration, by a court
of competent jurisdiction in the Commonwealth of Pennsylvania or such other
Person designated by such Court. The two arbitrators so selected shall within
fifteen (15) days after their designation select a third arbitrator; provided,
however, that if the two arbitrators are not able to agree on a third arbitrator
within such fifteen (15) day period, either Party may request a court of
competent jurisdiction in the Commonwealth of Pennsylvania or such other Person
designated by such court to select the third arbitrator as soon as possible. In
the event the court declines to appoint an arbitrator, appointment shall be
made, upon application of either Party, pursuant to the Commercial Arbitration
Rules of the American Arbitration Association. If any arbitrator refuses or
fails to fulfill his or her duties hereunder, such arbitrator shall be replaced
by the Party which selected such arbitrator (or if such arbitrator was selected
by another Person, through the procedure which such arbitrator was selected)
pursuant to the foregoing provisions.

             12.2.4 The arbitrators selected by the Parties are not required to
be neutral, but the third arbitrator shall be neutral and shall be a retired
judge who has served either as a trial court judge in a state or federal
district court, or as a state or federal appellate court judge.

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             12.2.5 The Parties hereto hereby request and consent to the three
(3) arbitrators conducting a hearing in Pittsburgh, Pennsylvania no later than
sixty (60) days following their selection or thirty (30) days after all
prehearing discovery has been completed, whichever is later, at which the
Parties shall present such evidence and witnesses as they may choose, with or
without counsel.

             12.2.6 Except as modified by this Agreement, arbitration shall be
conducted in accordance with the Commercial Arbitration Rules and procedures of
the American Arbitration Association.

             12.2.7 Adherence by the arbitrators to formal rules of evidence
shall not be required. The arbitrators shall consider any evidence and testimony
that they determine to be relevant.

             12.2.8 The Parties hereto hereby request that the arbitrators
render their decision within thirty (30) calendar days following conclusion of
the hearing.

             12.2.9 Any decision by a majority of the arbitration panel shall be
final, binding and non-appealable. Any such decision maybe filed in any court of
competent jurisdiction and may be enforced by any Party as a final judgment in
such court.

             12.2.10 The statute of limitations and any equitable period of
laches shall be tolled from and after the date a Party gives the other Party
written notice of a Claim as provided in this Section 12.2 above until such time
as the Claim has been resolved pursuant to this Section 12.2, or an arbitration
decision has been entered pursuant to Section 12.2.9.

             12.2.11 Either Party may apply to the arbitrators seeking
injunctive relief until the arbitration award is rendered or the controversy is
otherwise resolved. Either Party also may, without waiving any remedy under this
Agreement, seek from any court having jurisdiction any

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interim or provisional relief that is necessary to protect the rights or
property of the Party, pending the establishment of the arbitral tribunal or
pending the arbitral tribunal's determination of the merits of the controversy.

         13. NOTICES
             -------

             Any notice or report made by either party shall be considered
proper and effective if mailed by certified mail addressed as shown below, or
delivered in person and in writing. Generon and OxyNet agree to notify all other
parties of any changes.

                  If to Generon, as follows:

                  MG Generon, Inc.
                  5 Great Valley Parkway
                  Malvern, Pennsylvania  19033-0739
                  Attention:  President
                  Facsimile: (610) 695-7766

                  With a copy to:

                  Montgomery, McCracken, Walker & Rhoads, LLP
                  123 South Broad Street
                  Philadelphia, Pennsylvania 19109
                  Attention: Baldo M. Carnecchia, Jr.
                  Facsimile: (215) 772-7620

                  If to OxyNet or NetMed, as follows:

                  NetMed
                  6189 Memorial Drive
                  Dublin, Ohio 43017
                  Attention: President
                  Fax: (614)793-9376

or to such changed address as shall have been designated by notice.

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         14. GENERAL PROVISIONS
             ------------------

             14.1 WAIVER OR MODIFICATION. The waiver, amendment or modification
of this Agreement or any right or obligation hereunder shall not be effective
unless agreed to by each of the parties in writing.

             14.2 FORCE MAJEURE. Neither party will be deemed in default of this
Agreement to the extent that performance of its obligations or attempts to cure
any breach are delayed or prevented by reason of any act of God, fire, natural
disaster, accident, act of government, shortages of material or supplies or any
other cause beyond the control of such party, provided that such party gives the
other party written notice thereof promptly and, in any event, within thirty
(30) days of discovery thereof and uses good faith efforts to so perform or
cure. In the event of such a Force Majeure, the time for performance or cure
will be extended for a period equal to the duration of the Force Majeure.

             14.3 GOVERNING LAW. This Agreement shall be governed by the laws of
the Commonwealth of Pennsylvania, without regard to Pennsylvania conflicts of
laws principles.

             14.4 SEVERABILITY. If any provisions of the Agreement or the
application of any such provision shall be held to be contrary to law, the
remaining provisions of this Agreement shall continue in full force and effect.

             14.5 ENTIRE AGREEMENT. The parties acknowledge that this Agreement
(along with the Intellectual Property Development and Ownership Agreement)
expresses their entire understanding and agreement with respect to Licensed
Products or Licensed Methods sold or used after the Effective Date of this
Agreement.

             14.6 ASSIGNMENT. Except for assignment to a successor in interest
to substantially the entire business to which this Agreement relates, neither
party shall assign this

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Agreement without the prior written consent of the other, which consent shall
not be unreasonably withheld or delayed. The grant of a sublicense by Generon as
hereinabove permitted shall not be deemed to be an assignment. Except as
otherwise provided herein, this Agreement shall be binding on and inure to the
benefit of each party and their respective heirs, personal representatives,
executors, successors and assigns.

        IN WITNESS WHEREOF, the Parties have executed this Agreement as of
the date first above written.

                                  MG Generon, Inc.

                                  By.  /s/ Barry J. Smith
                                     -------------------------------------------
                                  Name: Barry J. Smith
                                  Title: VP and General Manager

                                  OxyNet, Inc.

                                  By.  /s/ David J. Richards
                                     -------------------------------------------
                                  Name: David J. Richards
                                  Title: President

                                  NetMed, Inc.

                                  By.  /s/ David J. Richards
                                     -------------------------------------------
                                  Name: David J. Richards
                                  Title: President

                                       14<PAGE>   1

                                  Exhibit 10.9

                      REIMBURSEMENT AND SECURITY AGREEMENT
                      ------------------------------------

         THIS REIMBURSEMENT AND SECURITY AGREEMENT ("Security Agreement") is
made as of this 30TH day of April, 1999, by OXYNET, INC., an Ohio corporation
formerly known as CERAM OXYGEN TECHNOLOGIES, INC. ("Debtor"), to and in favor of
MG GENERON, INC., a Delaware corporation ("Secured Party").

                                   WITNESSETH:

         WHEREAS, Debtor is the exclusive licensee of certain patented and other
proprietary technology in the field of oxygen concentration/generation (the
"Licensed Technology") licensed to Debtor pursuant to a certain License
Agreement dated February 28, 1997, as amended by an Amendment to License
Agreement dated March 31, 1998 (as amended, the "CeramPhysics License") by and
between Debtor and CeramPhysics, Inc., an Ohio corporation ("CeramPhysics").

         WHEREAS, pursuant to a certain Exclusive License Agreement by and among
Debtor, Secured Party and NetMed, Inc., an Ohio corporation ("NetMed"), of even
date herewith (the "Generon License"), Debtor granted to Secured Party certain
exclusive rights in and to certain "Licensed Technology" as more fully described
and defined in the Generon License, and Debtor, Secured Party and NetMed
contemporaneously entered into a certain Intellectual Property Development and
Ownership Agreement in connection therewith (the "Development Agreement").

         WHEREAS, pursuant to the CeramPhysics License, Debtor is required to
make certain payments to CeramPhysics including, but not limited to, payments of
royalties, and the failure by Debtor to make the required payments under the
CeramPhysics License may result in termination of the CeramPhysics License and
may jeopardize the Secured Party's exclusive rights to use the Licensed
Technology.

         WHEREAS, it is in the best interest of the Secured Party for Debtor to
meet its payment obligations under the CeramPhysics License so that Secured
Party may maintain its use of the technology licensed to Debtor under the
Generon License, and Generon would not enter into the Generon License without
assurances of uninterrupted use of the technology licensed thereunder.

         WHEREAS, pursuant to the terms of this Agreement, Debtor has given the
Secured Party the right, in its sole discretion, to satisfy Debtor's payment
obligations under the CeramPhysics License for and on behalf of Debtor in the
event that, for any reason, Debtor falls to meet its payment obligations under
the CeramPhysics License, upon the condition that Debtor grants to and creates
in favor of the Secured Party a present first lien and security interest in
Debtor's license of the Licensed Technology to secure any such future advances.

         NOW, THEREFORE, to induce the Secured Party to enter into the Generon
License and the Development Agreement, and to pay the consideration set forth in
Section 3 of the Development Agreement, and for and in consideration of any
amounts paid by the Secured Party

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to CeramPhysics at anytime during the term of the Generon License for or in the
name of Debtor, and intending to be legally bound hereby, Debtor agrees as
follows:

         1. GRANT OF SECURITY INTEREST.

         As security for the full and faithful performance of the duties and
obligations of the Secured Party and NetMed under the Generon License and the
Development Agreement, and for the repayment in full of any amounts paid to
CeramPhysics for or on behalf of Debtor under the CeramPhysics License, Debtor
hereby conveys, assigns, pledges, mortgages, transfers, and grants to the
Secured Party, and its successors and assigns, a first lien on and security
interest in and to, the following (which shall be referred to herein as the
"Collateral"):

            (a) The CeramPhysics License, and all proceeds thereof including,
without limitation, all rights of Debtor as the exclusive licensee of
CeramPhysics' patent, oxygen concentration/generation technology, confidential
information, and proprietary material as more fully set forth in the
CeramPhysics License, including, without limitation, all interests, proceeds,
royalties, recoveries, income, and license and sublicense fees associated
therewith; and

            (b) All other intellectual property and related rights of Debtor in
and related to the Licensed Technology, including, without limitation,
confidential or proprietary information, know-how, trade secrets, secret
formulas, technical information, computer software, programs, source code,
object code, tape disks and related materials, patents and applications
therefor, copyright registrations and applications therefor, trademarks, service
marks, trade names and all names used or usable by Debtor in connection with the
CeramPhysics License, and all goodwill related to the foregoing.

         2. REIMBURSEMENT AGREEMENT.

            (a) Debtor hereby grants to the Secured Party the right, in Secured
Party's sole discretion, to cure any monetary default under the CeramPhysics
License for and on behalf of Debtor. For purposes hereof, Debtor hereby appoints
and constitutes the Secured Party as Debtor's attorney-in-fact for making any
such payments. Debtor hereby covenants and agrees to inform the Secured Party in
writing of any payment due to CeramPhysics that Debtor has not paid or cannot
for any reason pay on a timely basis, and to notify the Secured Party
immediately of any claim, demand or other request for payment by CeramPhysics or
notice of default from CeramPhysics for any reason.

            (b) In the event that the Secured Party makes any payment hereunder
to CeramPhysics, the Secured Party shall notify Debtor in writing, accompanied
by a demand for reimbursement of the amounts paid. Debtor shall repay such
amounts paid within ten (10) business days after the date of such payment, with
interest at a rate per annum equal to the prime rate (as published in THE WALL
STREET JOURNAL on the date of the payment by the Secured Party to CeramPhysics)
plus four percent (4%) through the date of repayment.

            (c) Debtor's failure to repay any amounts due under Section 2(b)
above within ten business (10) days as provided above, or CeramPhysics refusal
to accept any payment

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tendered by Generon pursuant to the terms hereof, and/or any breach or default
under the Generon License and/or the Development Agreement which remains uncured
after forty-five (45) days following notice by Generon to the Secured Party
thereof or that Debtor has not commenced and is diligently pursuing a cure where
the breach or default cannot be cured within such period, shall constitute an
"Event of Default" hereunder and shall entitle the Secured Party, without
further notice to Debtor, to pursue the remedies of a Secured Party described in
Section 6(a) hereof, and in that regard, the Secured Party shall be entitled to
recover, in addition to all amounts due and owing, any and all fees and expenses
(including attorneys' fees and expenses) incurred in pursuit of the remedies so
provided.

         3. DUTIES OF DEBTOR.  Debtor shall have the following duties and
responsibilities:

            (a) To promptly notify the Secured Party of any notice by
CeramPhysics to Debtor of any default, event of default, event which with the
passage of time could give rise to a default or event of default, or other
breach by Debtor in the performance and observance of any of the terms,
covenants, representations or warranties of the CeramPhysics License.

            (b) Debtor shall not assign the CeramPhysics License or otherwise
transfer its interest in the Licensed Technology or terminate, cancel, modify,
change, alter or amend the CeramPhysics License, either orally or in writing,
without the prior written consent of the Secured Party.

         4. REPRESENTATIONS, COVENANTS, AND WARRANTIES. Debtor represents,
warrants, covenants and agrees that:

            (a) Debtor owns and will continue to own all right, title and
interest in and to the Licensed Technology as set forth in the CeramPhysics
License, free and clear of all claims, security interests, liens, encumbrances,
agreement and rights of third parties, and will defend such licensed rights
against the claims and demands of all persons.

            (b) The CeramPhysics License is in full force and effect and has not
been modified or amended in any manner, except as heretofore disclosed to the
Secured Party in writing.

            (c) Debtor has the full power and authority to extend the rights
granted herein to Secured Party and has not made and will not make during the
term of this Security Agreement any commitment to another party inconsistent
with or in derogation of such rights.

            (d) All payments due and payable to CeramPhysics pursuant to the
CeramPhysics License have been paid in full to the extent payable before the
date of this Security Agreement.

            (e) No consent or approval of CeramPhysics or any other third party
is required in order to effectuate the terms hereof or to permit Debtor to grant
the security interest described above or to perform hereunder.

                                       3
<PAGE>   4

         5. PROVISIONS APPLICABLE TO PROTECTION OF FIRST PRIORITY LIENS.

            (a) UCC FINANCING STATEMENTS. In connection herewith, Debtor shall
execute and deliver to the Secured Party such financing statements, assignments,
acknowledgements, and other documents as are necessary or required to perfect
the Secured Party's first lien and security interest in the Collateral. Debtor
shall further execute and/or cause to be filed all such other documents
(including, without limitation, all those required by subsection (b) hereof) as
may be necessary or desirable to perfect or maintain, to the extent and in the
manner herein provided, the first priority security interests of the Secured
Party in the Collateral granted hereunder at all times fully perfected and in
full force and effect. Debtor shall cause to be delivered on the date hereof
opinions of counsel, in form and substance acceptable to the Secured Party, with
respect to the validity, priority and perfection of the liens created hereunder.

            (b) FURTHER ASSURANCES. Debtor represents and agrees that it will,
at its own expense, from time to time at the request of the Secured Party,
execute, file, record, and/or deliver to the Secured Party (or cause the same to
occur) such instruments, notices, assignments, bills, financing statements,
continuation statements, and other documents and amendments thereto, necessary
to perfect and preserve the priority of, said first priority security interests
on and in the Collateral and each item thereof.

         6. REMEDIES, APPLICATION OF MONEYS.

            (a) REMEDIES. Upon the occurrence of any Event of Default, the
Secured Party shall have such rights and remedies in respect of the Collateral
or any portion thereof as provided by applicable law, including, without
limitation, the Uniform Commercial Code as enacted in any jurisdiction, and such
other rights and remedies in respect thereof which a secured party may have at
law or in equity or under this Security Agreement.

            (b) APPLICATION OF MONEYS. The Secured Party shall apply any
proceeds of any realization on Collateral to the satisfaction of the amounts due
and owing to the Secured Party, with any remainder being paid to Debtor. Nothing
herein shall be deemed to preclude the Secured Creditor from bidding on the
Collateral at any sale pursuant to the enforcement of the Secured Party's rights
and remedies hereunder.

            (c) DEFICIENCY. If proceeds referred to in subsection (b) above are
insufficient to pay the obligations in full, Debtor shall continue to be liable
for the entire deficiency.

         7. CARE OF COLLATERAL BY SECURED PARTY. The Secured Party shall not
have the duty to take any action necessary to preserve Debtor's right, title or
interest to or in any Collateral against any other party.

         8. REMEDIES CUMULATIVE. No remedy herein conferred upon the Secured
Party is intended to be exclusive of any other remedy and each and every such
remedy shall be cumulative and shall be in addition to every other remedy given
hereunder or now or hereafter existing at law or in equity or by statute or
otherwise.

                                       4
<PAGE>   5

         9. REMEDIES NOT WAIVED. No course of dealing between Debtor and the
Secured Party or any delay on the part of any of them in exercising any rights
or remedies hereunder or under applicable law shall operate as a waiver of any
rights or remedies of any of them, whether arising hereunder or under any other
agreement between the parties.

         10. DEFEASANCE. Upon termination of the Generon License and the
indefeasible payment in full of all obligations of Debtor to the Secured Party,
this Security Agreement shall terminate and be of no further force and effect;
and in such event, the Secured Party at Debtor's expense will take all action
necessary to terminate the security interests of the Secured Party in the
Collateral. Until such time, however, this Security Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns.

         11. NO DISCHARGE. The obligations of Debtor to the Secured Party shall
be absolute and unconditional and shall remain in full force and effect without
regard to, and shall not be released, discharged or in any way affected by: (a)
any exercise or nonexercise of any right, remedy, power or privilege under or in
respect of this Security Agreement or applicable law, or any waiver, consent,
extension, indulgence or other action or inaction in respect of any thereof, or
(b) any other action or thing (other than payment) or omission or delay to do
any other action or thing which may or might in any manner or to any extent
otherwise operate as a discharge of Debtor as a matter of law.

         12. AMENDMENT; WAIVER. No amendment or waiver of any provision of this
Security Agreement nor consent to any departure by Debtor therefrom shall in any
event be effective unless the same shall be in writing.

         13. SEVERABILITY. Any provision of this Security Agreement prohibited
by the laws of any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition, or modified to conform with such laws,
without invalidating the remaining provisions of this Security Agreement, and
any such prohibition in any jurisdiction shall not invalidate such provisions in
any other jurisdiction. All rights, remedies and powers provided in this
Security Agreement may be exercised only to the extent that the exercise thereof
does not violate any applicable provision of law, and all the provisions of this
Security Agreement are intended to be subject to all applicable mandatory
provisions of law which may be controlling and to be limited to the extent
necessary so that they will not render this Security Agreement illegal, invalid,
unenforceable, in whole or in part, or not entitled to be recorded, registered,
or filed under the provisions of any applicable law.

         14. ASSIGNEES. Any permitted assignee of or successor to a party hereto
shall succeed to all rights and benefits, and be bound by all obligations,
inuring to such party.

         15. GOVERNING LAW. This Security Agreement shall be construed in
accordance with and governed by the laws, including equitable principles but
without regard to principles of conflict of laws, of the State of Ohio.

         16. HEADINGS. The section headings in this Security Agreement are for
convenience only and shall not affect the construction hereof.

                                       5
<PAGE>   6

         17. Notices. Any notice hereunder shall be in writing and shall be
conclusively deemed to have been received by a party hereto and to be effective
on the day on which delivered to such party at its address set forth on the
signature pages hereto (or at such other address as such party shall specify to
the other parties hereto in writing), or, if sent by certified mail, on the
third business day after the day on which mailed, addressed to such party at
such address.

         18. COUNTERPARTS. This Security Agreement may be executed in two or
more counterparts, each of which shall constitute an original, but all of which,
when taken together, shall constitute but one instrument.

         IN WITNESS WHEREOF, Debtor has caused this Security Agreement to be
duly executed and delivered as of the day and year first above written.

                                  OxyNet, Inc..

                                  By.  /s/ David J. Richards
                                     ------------------------------------------
                                  Title: President

                                  MG Generon, Inc.

                                  By.  /s/ Barry J. Smith
                                     ------------------------------------------
                                  Title: VP and General Manager

                                      6

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