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Employment Agreement - Biopure Corp. and Daniel R. Davis

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December 3, 1998,
as amended and restated
as of June 24, 1999

Mr. Daniel R. Davis
11385 Homedale Street
Los Angeles, CA 90049

Dear Daniel,

It gives me great pleasure to offer you the position of Chief Financial Officer
and Senior Vice President, reporting to Carl Rausch, Chairman of the Board,
President and CEO with a start date to be as of December 7, 1998.

This position is being offered at the exempt rate of $6,539 per pay period. With
26 pay periods per year, this would equate to an annualized salary of $170,014.

You will also be entitled to the following:

-        Participation in Biopure's Management Bonus Program. This is a
         non-guaranteed, discretionary plan based on individual and corporate
         achievement typically paid out during the first quarter of the new
         fiscal year for last fiscal year performance. Your participation for
         1998 will be on a prorated basis since you will not have worked for
         Biopure during the entire fiscal year of 1998.

-        Subject to Board of Director approval, you will receive an option to
         purchase 75,000 shares of Biopure common stock granted as of December
         3, 1998, with an exercise price of $6.667 per share and an option to
         purchase one hundred thousand (100,000) shares of Biopure common stock
         as of February 1, 1999, with an exercise price of $12.00 per share.

-        Vesting is 25% per year with 10 years to exercise options.

-        New incentive options shall be provided following the IPO or earlier
         liquidity event which will be 75,000 shares. These options will strike
         at a price consistent with those offered to other senior members of the

-        Three weeks paid vacation plus customary holidays and
         sick/personal days.

-        The Company will reimburse you for up to $20,000 of
         relocation expenses, plus gross up, which you incur in
         relocating to Massachusetts. Expenses should be reasonable,

<PAGE>   2

Mr. Daniel R. Davis
Page 2
December 3, 1998

         supported by actual receipts, and may include costs
         associated with: a) packing, shipping and storage of
         household goods; b) house hunting; c) travel; d) temporary
         living; e)closing costs for your present residence; f)
         closing costs for your new residence. Further, by signing
         this document, you agree to reimburse the Company in full
         for relocation expenses reimbursed if you voluntarily leave
         the Company during your first year of employment and 50% of
         relocation expenses reimbursed if you voluntarily leave the
         Company during your second year of employment.

As conditions of employment, you are required to:

a.       Successfully complete a standard medical examination prior to
         commencing employment. This medical exam is typically given by a local
         medical group retained by Biopure but due to your location, we can
         provide the appropriate forms for your private physician to complete
         and return to our attention. The standard medical exam will be
         reimbursed by Biopure.

b.       In accordance with the 1986 Immigration and Control Act ("RCA"),
         demonstrate that you have a lawful right to work in the United States.

c.       Sign a standard "Employee Agreement Concerning Protection of Company
         Property and the Arbitration of Legal Disputes". A copy of this
         agreement is attached for your review and signature. Please read it

On behalf of Carl and myself, we are looking forward to your joining the Biopure


Carolyn R. Fuchs
Vice President,
Human Resources


/s/ Carolyn R. Fuchs


<PAGE>   3

                                                      February 23, 1999

Mr. Daniel R. Davis
Biopure Corporation
11 Hurley Street
Cambridge, Massachusetts 02141

Dear Daniel:

         This letter is intended to amend and clarify your employment agreement
with Biopure Corporation set forth in a letter dated December 3, 1998 (the

         The amendment and clarification relate only to the options to be
granted to you, as set forth in the second bullet point of the Letter. Now, you
and Biopure have agreed as follows: you will receive an option to purchase
seventy-five thousand (75,000) shares of Biopure common stock granted as of
December 3, 1998, with an exercise price of $6.6667 per share and an option to
purchase one hundred thousand (100,000) shares of Biopure common stock as of
February 11, 1999, with an exercise price of $12.00 per share.

         The previous paragraph replaces the second bullet point of the letter;
in all other respects the letter remains in full force and effect. Please note,
however, that the number of shares subject to "incentive" options both in the
grants described above and following the Company's IPO or other liquidity event,
will be limited by applicable Federal income tax law.

         If you agree with the foregoing, please sign below.


                                                 BIOPURE CORPORATION

                                                 By:/s/ Carolyn R. Fuchs
                                                    Carolyn R. Fuchs
                                                    Vice President
                                                    Human Resources


/s/ Daniel R. Davis

Date: 2/24/99