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Sample Business Contracts

License Agreement - EarthShell Container Corp. and Mobil Chemical Co.

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     THIS AGREEMENT is made upon and shall be effective as of ____________,
199_, by and between EARTHSHELL CONTAINER CORPORATION, a Delaware corporation
("ECC"), and MOBIL CHEMICAL COMPANY, an unincorporated division of MOBIL OIL
CORPORATION, a Corporation formed and existing under the laws of New York
("Sublicensee").


                                    RECITALS:

     A.   Pursuant to that certain License Agreement, dated February 24,
1993, (the "License Agreement") between E. Khashoggi Industries, a California
general partnership ("EKI") and ECC, ECC has the exclusive right to utilize
specified technology to manufacture and sell within a specified field of use
certain containers made from hydraulically reacting materials for the
packaging, storage, portioning, dispensing, carrying, presenting, serving and
consumption of food and beverages.

     B.   ECC has the right and authority to grant sublicenses which will
permit selected entities to utilize such technology in order to manufacture
and sell certain food and beverage containers made from hydraulically
reacting materials.

     C.   Sublicensee desires to obtain from ECC a sublicense to utilize such
technology in order to manufacture and sell certain designated food and
beverage containers made from hydraulically reacting materials within a
designated geographical area.

     D.   ECC has engaged in discussions and made certain representations to
the Sublicensee; based upon Sublicensee's independent evaluation, Sublicensee
is willing to acquire necessary equipment and construct a pilot production
line to use the Technology in the commercial manufacture of the Products
(such production line is herein referred to as the "Pilot Production Line"). 

     E.   The construction of this Pilot Production Line will benefit ECC as
well as the Sublicenses, but will be constructed at the cost and expense of
the Sublicensee.


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     F.   In light of the capital commitment of the Sublicensee pursuant to
the terms of this Sublicense Agreement, ECC has granted the Sublicensee all
rights and licenses necessary for the production of the Products utilizing the
Technology.

     G.   ECC is willing to grant a sublicense to Sublicensee upon the terms
and conditions set forth herein.

                                   AGREEMENT:

     NOW, THEREFORE, in consideration of the foregoing Recitals and the
covenants and agreements set forth herein, together with other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties agree as follows:

     1.   DEFINITIONS.   The capitalized terms used herein shall have the
meanings set forth below, or the meanings assigned to them elsewhere herein:

          (a)  The term "Affiliate" shall mean, with respect to any given
entity (which includes without limitation any company, organization, or
person), any other entity directly or indirectly controlling, controlled by,
or under direct or indirect common control with such given entity. For
purposes of this definition, the ownership of a twenty-five percent (25%) or
greater equity interest in an entity shall be deemed control of such entity,
and the ownership of less than a twenty-five percent (25%) equity interest in
an entity (absent any other exercise of control) shall be deemed not to be
control of such entity.

          (b)  The term "Field of Use" shall mean the use and sale of Food
Packages in the food service or fast-food and restaurant industry. As used
herein, the term "food service" or "fast-food and restaurant industry" is
intended to include any facility (whether commercial, nonprofit,
governmental, or other) where food and beverages are (i) sold or provided for
consumption on the premises or (ii) packaged in single portions, or multiple
portions, intended for immediate consumption. The term "Field of Use" shall
also include the use and sale of Food Packages in other retail establishments
selling food or beverages or Food Packages (e.g., grocery stores, convenience
stores, and food warehouses-hereinafter the "retail food selling industry"),
but only with respect to Food Packages which are the

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<PAGE>

same or substantially similar to any Food Package which has been introduced
into the fast-food and restaurant industry or the retail food selling
industry by an entity (including any Affiliates) that operates retail
establishments in the fast-food and restaurant industry in at least six
locations. The sale of Food Packages to distributors and wholesalers for
resale and use in the food service or fast food and restaurant industry is
included within the Field of Use. Notwithstanding the foregoing, the parties
agree, as set forth in paragraph 1(e), that certain items shall not be within
the definition of Field of Use.

          (c)  The term "Food Packages" shall mean any product, apparatus,
device, or equipment for packaging, storage, portioning, dispensing,
carrying, presenting, serving or consumption of food or beverages.

          (d)  The term "Gross Sales Price" shall mean the gross invoice
price charged by Sublicensee in the sale of a Product to a non-Affiliate
reduced by i) any credit allowed by Sublicensee for the return of Product;
ii) customary trade, quantity and cash discounts allowed by Sublicensee; iii)
excise, value added and sales taxes actually paid by Sublicensee on the
Product; (iv) freight charges actually paid by Sublicensee for the shipment and
delivery of the Product; and (v) bad debts or uncollected accounts. In the
case of non-cash consideration, "Gross Sales Price" shall be the fair market
value of all non-cash consideration actually received by Sublicensee or its
Affiliate for such Product. The "Gross Sales Price" of Products sold or
transferred to an Affiliate shall be deemed to be the price then charged to
unrelated parties in arms-length transactions for such Products in similar
quantities and under similar terms of sale.

          (e)  The term "Products" shall mean only those Food Packages set
forth on Exhibit "B", attached hereto and incorporated herein by this
reference, which incorporate in whole or in part any portion of the
Technology and which are used or sold in the Field of Use. Notwithstanding
any other provision of this Agreement, the parties agree that the following
items shall not be within the scope of the definition of "Products" or
otherwise available for licensing under this Agreement: sealed containers for
the long- 
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term storage of liquids whether for single or multiple portions (e.g., soft
drink cans, milk cartons, sealed juice or drink containers), or boxes or
sealed containers for the long term storage of single or multiple servings of
foods (e.g., dry cereals, egg cartons, and meat and deli trays) - the right to
license such items has been retained by EKI.
 
          (f)  The term "Technology" shall mean all of the proprietary
technology involving hydraulically reacting materials which is (i) described
or claimed in any United States patent or patent application set forth in
Exhibit "A",  attached hereto and incorporated herein, including without
limitation, any continuations, divisionals or continuations-in-part, reissues
and extensions thereto, and any patents issued therefrom, and (ii) the
subject of any future United States patents or patent applications to the
extent that such patents or patent applications are licensed to ECC and
directly utilized in the manufacture, use or sale of Food Packages by the
Sublicensee.  The Technology, to the extent it exists upon the execution date
of this Agreement, is further described on Exhibit "A".  The term Technology
shall also include the proprietary information of ECC, or licensed to ECC,
that is related to the Technology which is described on Exhibit "A" as "Trade
Secrets" and any other proprietary information of ECC, or licensed to ECC,
which is delivered, orally or in writing, to the Sublicensee and designated,
orally or in writing, as "Confidential".

          (g)  The term "Territory" shall mean all fifty states of the United
States of America and any territories or possessions of the United States. 
The term "Territory" also shall include Canada, Mexico, Central America, and
the Caribbean islands and nations, subject to any foreign territory being
removed,  all or in part, at ECC's option, if Sublicensee has not commenced
commercial production or sales of Products in such foreign territory prior to
January 1, 1996.

          (h)  If Sublicensee conducts business and wants to sell Products
outside of the Territory, ECC agrees that it will negotiate in good faith with
Sublicensee for a

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<PAGE>

separate non-exclusive sublicense covering a specified geographic area
outside of the Territory.

     2.   THE SUBLICENSE.

          (a)  ECC hereby grants to Sublicensee a non-exclusive,
royalty-bearing sublicense (the "Sublicense") to make, use, sell and
otherwise commercialize the Products solely within the Territory and solely
within the Field of Use.  The Sublicense shall be irrevocable except as
specifically provided in this Agreement.

          (b)  In the event that Sublicensee wishes to sell Food Packages
which do not fall within the definition of the Field of Use, and which
incorporate in whole or in part a portion of the Technology, Sublicensee must
obtain an appropriate license for the same from EKI.
     
          (c)  Sublicensee shall not have the right to further sublicense,
assign or transfer the Technology, or any interest in or rights under the
Sublicense (i) except to an Affiliate or (ii) except with the prior written
consent of ECC, which consent will not unreasonably be withheld (such
assignee referred to herein as a "Proper Assignee").  Any such purported
sublicense or transfer shall be void and shall constitute a breach of a
material obligations of Sublicensee within the meaning of paragraph 16,
hereof.  The merger or consolidation of Sublicensee or a Proper Assignee with
or the sale of substantially all of Sublicensee's or a Proper Assignees'
assets or equity interest to, any other entity that is not, prior to such
merger, consolidation or sale, an Affiliate of Sublicensee, whether occurring
by operation of law or otherwise, shall not be deemed to be an assignment of
the Technology and is expressly permitted under the terms of this Agreement.
      
          (d)  As more fully set forth in paragraph 10(b) hereof, Sublicensee
is authorized and required to utilize, in connection with the marketing,
distribution and sale of the Products, those trade names, trademarks, service
marks, slogans and logo marks


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<PAGE>

(collectively the "Trademarks") which are designated by ECC to Sublicensee
prior to commercial production of a Product by Sublicensee or from time to
time thereafter.

          (e)  From time to time during the term of this Agreement, the parties
may, by written agreement, amend Exhibit "B" hereto in order to add thereto
one or more additional Products or range of Products.  No amendment of
Exhibit "B" shall be effective unless it is in writing and signed by both of
the parties. The manufacture or sale of any Product not licensed hereunder
shall be a breach of a material obligation of Sublicensee within the meaning
of paragraph 16 hereof.  If Sublicensee requests that Exhibit "B" be amended
in order to add an additional Product or range of Products, ECC shall meet
with representatives of Sublicensee at reasonable times and at mutually
agreeable locations and shall discuss, in good faith, the amendment of
Exhibit "B" requested by Sublicensee. ECC shall have no obligation to amend
Exhibit "B" hereto in accordance with any request by Sublicensee unless the
terms and conditions of the proposed amendment are satisfactory to ECC. 

          (f)  Sublicensee shall not market, distribute or sell any Product
to any person, firm or entity outside the Territory, or to any person, firm
or entity within the Territory if Sublicensee knows or has reason to believe
that such person, firm or entity intends to use the Product in question
outside the Territory.  The sale or distribution of a Product outside the
Territory by Sublicensee shall constitute a breach of a material obligation
of Sublicensee within the meaning of paragraph 16 hereof.

     3.   ROYALTIES.

          (a)  As consideration for the grant of the Sublicense, Sublicensee
shall pay to ECC a royalty (the "Royalty") of twenty percent (20%) of the
Gross Sales Price for each Product which is sold by Sublicensee during the
term of this Agreement.

          (b)  Sublicensee shall be deemed to have "sold" a Product, and ECC
shall be deemed to have earned the Royalty, upon the earliest date that
Sublicensee actually ships, delivers, or invoices such Product to any person,
firm or entity, including but not

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<PAGE>
limited to any Affiliate of Sublicensee.  Provided, however, that the
Sublicensee shall be entitled to a credit for all bad debt or uncollected
accounts associated with the computation of Royalty for a given period.     

          (c)  No Royalty shall be payable on Products which are used by
Sublicensee to manufacture other Products which are sold and for which a
Royalty is paid to ECC.  No multiple Royalties shall be payable because a
Product is covered by more than one patent within the scope of the
Technology.  No Royalty shall be due, owing or payable on Products
manufactured on the Pilot Production Line which Products are used exclusively
for demonstration or market testing purposes. 

          (d)  Failure to make payment when due of any Royalty hereunder is a
breach of a material obligation of Sublicensee and may result in the
termination of this Agreement pursuant to paragraph 16 hereof.

     4.   PAYMENT OF THE ROYALTY.

          (a)  Within thirty (30) days of the final day of each calendar
quarter (or fiscal quarter if Sublicensee is reporting on a fiscal basis)
which occurs during the term of this Agreement (a "Quarter"), Sublicensee
shall pay to ECC the Royalty earned on all Products sold by Sublicensee
during such Quarter. Each Royalty payment shall be accompanied by a written
report (the "Royalty Report") prepared by Sublicensee and certified as
accurate by the principal financial officer of Sublicensee.  Each Royalty
Report shall set forth, for the Quarter covered by the Royalty Report, (i)
the number of each of the Products sold by the Sublicensee, (ii) the gross
invoice price for each of such Products, and (iii) reductions to the gross
invoice price for applicable returns, discounts, freight charges, bad
debts/uncollected accounts and taxes with respect to Products sold.
 
          (b)  All payments called for by this Agreement shall be paid by
Sublicensee in United States dollars.

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<PAGE>

     5.   RIGHT TO AUDIT.

          (a)  Sublicensee shall keep and maintain complete and accurate
records concerning all aspects of the manufacture and sale of the Products. 
ECC or its designee (the "Representative") shall have the right, at ECC's
expense, periodically to review those records and operations of Sublicensee
which deal with the design, manufacture, shipment and sale of Products.  Such
reviews may take place only during the normal business hours of Sublicensee
and only upon written notice to Sublicensee given at least three (3) business
days prior to such review.  The Representative conducting such review shall
be required to execute a confidentiality agreement pursuant to which the
Representative shall agree that it will not disclose or use the information
obtained pursuant to such review to or for the benefit of any person or
entity except ECC unless required to do so in connection with the resolution
of any dispute concerning any payment required by this Agreement. 

          (b)  If any such review reveals, in the opinion of ECC, that
Sublicensee has not paid to ECC the full amount of any payment due hereunder
for the period covered by such review, ECC shall give the Sublicensee written
notice (the "Review Notice") of such discrepancy.  The Review Notice shall be
accompanied by a written report prepared by ECC or the Representative setting
forth, in reasonable detail, the basis of the alleged underpayment.  If
Sublicensee does not notify ECC that Sublicensee disputes the findings set
forth in such report, it shall pay to ECC the full amount of the underpayment
in question within 15 days of the date of receipt of the Review Notice.  All
underpaid amounts shall bear interest from the date upon which the payment in
question should have been made until it is actually paid at the lending
interest rate of prime (as published in the Wall Street Journal on the last
previous business day).  Additionally, if Sublicensee agrees to make the
underpayment specified in the Review Notice, Sublicensee shall also reimburse
ECC for the actual costs of the review if the underpayment amount is 5% or
more of the Royalty payment due during the period in question and such
underpayment exceeds $100,000 in amount.  In all other cases, ECC shall pay
all expenses and fees of the review,

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<PAGE>

including all out-of-pocket expenses actually and reasonably incurred by
Sublicensee in connection therewith.

          (c)  If Sublicensee disputes the findings set forth in the Review
Notice, it shall so notify ECC in writing ("Dispute Notice") within fifteen
(15) days of the receipt of the Review Notice.  Representatives of ECC and
Sublicensee shall meet and, in good faith, seek to resolve the dispute
through negotiation; provided, however, that if such dispute is not resolved
within ten (10) days of the Dispute Notice, ECC and Sublicensee shall jointly
agree to either (i) immediately retain a nationally-recognized independent
accounting firm (other than the firm which prepared the report which
accompanied the Review Notice), which is acceptable to both parties, to
conduct an additional review of the payments due to ECC, or (h) submit the
dispute to arbitration or mediation in accordance with the provisions of
paragraph 26 hereof.  In the event that ECC and Sublicensee are unable to so
jointly agree, the matter will be submitted to arbitration pursuant to clause
(ii) of the preceding sentence.  Sublicensee and ECC shall not unreasonably
withhold their approval of the accounting firm selected by either party
pursuant to clause (i) above.  The determination of such accountants or
arbitrators (or mediators) in regard to the accuracy of the payments made to
ECC shall be final and binding upon the parties, shall not be subject to
appeal or review by any court or governmental agency and shall be enforceable
in the appropriate United States state and federal courts.  If such review
reveals that Sublicensee has failed to pay to ECC the full amount of a
Royalty payment actually due, Sublicensee shall pay the full amount of such
discrepancy to ECC within three (3) days of the date of the report of such
accountants or the decision of the arbitrators, as the case may be. The full
amount of such underpayment shall bear interest at the lending interest rate
of prime (as published by the Wall Street Journal on the date of the Dispute
Notice or next business day) from the date the payment in question should
have been made until it is actually made.  Additionally, if it is determined
by the review conducted pursuant to this paragraph 5(c) that Sublicensee
underpaid ECC by 5% or more of the Royalty payment     

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<PAGE>

due during the period in question, and such underpayment exceeds $100,000 in
amount, Sublicensee shall pay all fees and expenses of the reviews and
arbitration (or mediation) conducted pursuant to paragraphs 5(b) and (c). 
In  all other cases, ECC shall pay all expenses and fees of both reviews and
arbitration, including all out-of-pocket expenses actually and reasonably
incurred by Sublicensee in connection therewith.
     
          (d)  The second failure within any two-year period by Sublicensee
to make timely payment of the correct Royalty amount due under this Agreement
as finally determined under paragraph 5(c) shall constitute a breach of a
material obligation of Sublicensee and may result in the termination of this
Agreement pursuant to paragraph 16 hereof, unless Sublicensee has cured such
failure within sixty (60) days from the date notice of such failure is
delivered to Sublicensee.
   
     6.   IMPROVEMENTS TO TECHNOLOGY
     
          (a)  If, while the Sublicense remains in effect, Sublicensee should
develop any improvement, refinement or change, whether patentable or
unpatentable, relating in whole or in part to any portion of the Technology
or the Products (such improvement hereinafter referred to as an
"Improvement"), to the extent that the Improvement is directed to a
composition, formulation or the material (i.e., other than a method of
manufacture, handling or processing of Food Packages) Sublicensee shall
notify ECC of such Improvement within a reasonable time of and in no event
more than ninety (90) days after its development and shall provide ECC with
access to all information concerning such improvement as ECC shall reasonably
request:  provided, however, that all such information shall be confidential
and shall be subject to all restriction on disclosure as set forth in this
Agreement or otherwise arising.  Sublicensee (i) shall assign the
non-exclusive right to make, use, sell, sublicense and otherwise
commercialize the Improvement (A) outside of the Territory and (B) within the
Field of Use, within the Territory to ECC for an assignment fee of $1,000.00
and (ii) shall retain a non-exclusive perpetual (i.e., to the fullest extent
it is legally empowered) license to make, use, sell or otherwise
commercialize the


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Improvement both within and outside of the Field of Use and within and
outside the Territory.  If ECC (i) obtains rights in and to an Improvement
from another sublicensee of the Technology, in whole or in part, or otherwise
or (ii) develops such Improvement, it shall within a reasonable time of and
in no event more than ninety (90) days after it obtains such rights inform
the Sublicensee of such Improvement and at the request of the Sublicensee
grant the Sublicensee a non-exclusive perpetual (i.e., to the fullest extent
it is legally empowered) license to make, use, sell or assign (pursuant to
the terms of this Sublicense Agreement) the Improvement within the Field of
Use within the Territory.  No additional Royalty will be due by virtue of the
addition of an Improvement to the Technology.
      
          (b)  ECC, or the Assignee in case of a subsequent assignment, shall
have the right to (i) affirmatively seek patent protection for the
Improvement at ECC's or Assignee's sole cost and expense or (ii) maintain the
Improvement as a Trade Secret.

          (c)  In the event that Sublicensee does not seek patent protection
for the Improvement ECC or Assignee may elect to seek patent protection
either in the United States or in any foreign jurisdiction.  Sublicensee
shall provide ECC or Assignee with such assistance as may be reasonably
requested, from time to time, in connection with such efforts, including the
execution of any documents necessary to obtain and maintain such patent
protection; provided, however, that ECC or Assignee will reimburse
Sublicensee for any out-of-pocket fees and expenses reasonably incurred by
Sublicensee in providing such assistance.  ECC or Assignee shall keep the
Sublicensee informed of the status of the prosecution of each patent
application which it elects to pursue and shall consult with Sublicensee on
all material aspects of the prosecution of such application, although all
final decisions in regard to such patent application shall remain within the
sole discretion of ECC or Assignee.
 
          (d)  If the Improvement is directed to a method of manufacture,
handling, or processing of Food Packages, and if such manufacturing,
handling, or processing Improvement has a substantial use with composition,
formulation, and materials within the

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scope of this Sublicense, then Sublicensee will notify (within a reasonable
time not to exceed ninety (90) days) ECC of the development of the
Improvement and grant to ECC the exclusive right to negotiate, for a period
of ninety (90) days after delivery of such notice, for a license which will
authorize ECC to use, license or otherwise commercialize such Improvement. 
Sublicensee will negotiate in good faith the terms of the license for the
Improvement.  Failure of ECC and Sublicensee to agree on a license agreement
shall not give rise to any right on the part of either party to seek to
resolve the impasse (i) through arbitration under this Sublicense Agreement
or (ii) otherwise.  It is expressly understood by the parties hereto, that an
Improvement in the manufacturing process is the sole and exclusive right and
property of the Sublicensee; disclosure of such information is subject to the
confidentiality provisions of this Sublicensee Agreement or as may otherwise
apply; and the licensing of the same to ECC is subject to negotiation of an
agreement on terms mutually acceptable to ECC and Sublicensee. 

     7.   "NEW USE" PRODUCTS.

          If, during the term of this Agreement, Sublicensee determines that
there exists a commercially feasible use, application, function, or purpose
for the compositions, formulations, or materials which are in whole or in
part disclosed (even though not claimed) in the Technology, whether
patentable or unpatentable, and which have no substantial use as Food
Packages (hereinafter "New Use"), Sublicensee shall give written notice, of
such New Use to ECC (the "New Use Notice") within a reasonable time not to
exceed ninety (90) days of such a determination.  If ECC, or its Affiliates,
does not have any existing intellectual property protection (whether in the
form of a patent application, a trade secret, or the subject of previous or
continuing research and development) relating to the New Use, then ECC, or
its assignee, shall have the exclusive right to negotiate, for a period of
ninety (90) days after the New Use Notice, with the entity identified in the
New Use Notice for a license which will authorize ECC, or its assignee, to
manufacture, sell, and commercialize the New Use so long as the New Use
relates to materials, formulations, or

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compositions.  In any event Sublicensee shall have the right to incorporate
the New Use into Products licensed hereunder and no additional Royalty will
be due by virtue of the incorporation of the New Use into Products licensed
hereunder. However, if the New Use relates to machinery and equipment, the
Sublicensee shall have the option to negotiate, or to not negotiate, with
ECC, or its assigns, for a license to manufacture, sale and commercialize the
New Use relating to machinery and equipment.  However, if Sublicensee desires
to sell the licensing rights of such New Use relating to machinery and
equipment, Sublicensee shall provide a first right of refusal to ECC to
acquire the such licensing rights on the same terms and conditions as agreed
to by a third party. Sublicensee will negotiate in good faith the terms of
the license for the New Use.  In the event that ECC, or its Affiliates, is
seeking or has been granted patent protection on the compositions,
formulations, or materials to be incorporated into the New Use, ECC, or its
Affiliates in good faith negotiate to grant Sublicensee a license to
incorporate such compositions, formulations or materials into the New Use. 
Failure of ECC and Sublicensee to agree on a license agreement shall not give
rise to any right on the part of either party to seek to resolve the impasse
(i) through arbitration under this Sublicense Agreement or (ii) otherwise. 
It is expressly understood by the parties hereto, that an Improvement in the
manufacturing process is the sole and exclusive right and property of the
Sublicensee; disclosure of such information is subject to the confidentiality
provisions of this Sublicensee Agreement or as may otherwise apply; and the
licensing of the same to ECC is subject to negotiation of an agreement on
terms mutually acceptable to ECC and Sublicensee.

     8.   INFRINGEMENT MATTERS.

          (a)  ECC and Sublicensee will promptly notify (within 30 days) one
another of any apparent infringement of the Technology (whether or not such
apparent infringement is within the Field of Use) or of the Trademarks which
comes to their attention while the Sublicense remains in effect, and if in
ECC's opinion the apparent infringement has substantial and adverse
consequences ECC shall, at its sole cost and

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expense, bring suit to enjoin such infringement and to recover damages
therefor. In any action brought by ECC pursuant to paragraph 8(a) hereof,
ECC shall select and control counsel for the prosecution of such suit. 
Sublicensee shall (i) have the right to receive, from time to time, full and
complete information from ECC concerning the status of such suit, (ii) have
the right, at Sublicensee's own expense, to be represented therein by counsel
in an advisory or consultative capacity, and (iii) cooperate fully with ECC
and provide whatever assistance is reasonably requested by ECC in connection
with such suit including the preparation and signing of documents.  If ECC
decides not to bring suit to enjoin an alleged infringement either because it
is deemed inadvisable or de minimis, no such action will be required. 
     
          (b)  The parties shall notify (within 30 days) each other of any
claim by any person that the use of the Technology with respect to any
Product by Sublicensee in the Fields of Use infringes the rights of such
person and of the commencement of any lawsuit against ECC, Sublicensee, or
any customers of the foregoing, as the result of such alleged infringement. 
ECC shall assume and control the defense of any such lawsuit, at its sole
cost and expense, irrespective of whether ECC is named as a defendant in such
litigation. Sublicensee will assist ECC in the defense of such suit or action
by providing information and fact witnesses as needed; provided, however,
that ECC shall reimburse Sublicensee for all out-of-pocket costs incurred by
Sublicensee in connection with such action by allowing a credit or offset
against the Royalty due hereunder.  Sublicensee shall have the right to be
represented in such suit or action by their own legal counsel, at their own
expense, provided that such legal counsel will act only in an advisory
capacity.  If ECC decides to not assume the defense of any infringement
lawsuit described in this paragraph 8(b), Sublicensee shall have the right,
but not the obligation, to assume the defense of such lawsuit utilizing legal
counsel of its choice.  Additionally, Sublicensee will indemnify and hold ECC
and its licensor of the Technology harmless from and against, and hereby
assumes liability for the payment of any and all loss, liability or damage,
and for all costs

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and expenses, including reasonable costs of investigation and reasonable
attorneys, accountants and expert witness fees (collectively "Losses") that
may be imposed upon, suffered or incurred by ECC and its licensor of the
Technology as a consequence of or in connection with any lawsuit described in
this paragraph 8(b), but only to the extent that such lawsuit and resulting
liability is based on matters other than the Technology licensed hereunder. 
 
          (c)  If, as the result of any lawsuit referred to in paragraph 8(b)
hereof, Sublicensee is required by final court order from which no appeal can
be taken (or by a court order which ECC's legal counsel believes has no
reasonable likelihood of success for modification on appeal) to obtain a
license under any third party's patent not licensed hereunder in order to
continue with Sublicensee's activities as contemplated by this Agreement, and
to pay a royalty under such license, and the infringement of such patent
cannot reasonably be avoided by Sublicensee, the future payment of the
Royalty shall thereafter be reduced by an amount equal to 100% of any fee or
royalty payable by Sublicensee under such additional license (including all
payments under such agreement whether for periods prior to such agreement or
order) as long as the infringement was due to the Technology licensed
hereunder.  In addition, if Sublicensee settles an infringement action
referred to in paragraph 8(b) hereof, after obtaining the prior written
consent of ECC (which shall not be unreasonably withheld), and pursuant to
such settlement Sublicensee obtains a license under any patent not licensed
hereunder, to make, use or sell the Products in any manner contemplated by
this Agreement, and agrees to pay a royalty under such license, and the
infringement of such patent cannot reasonably be avoided by Sublicensee, the
Royalty shall thereafter be reduced by an amount equal to 100% of the sum
payable by Sublicensee pursuant to such settlement as long as the settlement
was for claims of infringement due to the Technology licensed hereunder.

                                       15

<PAGE>

     9.   PRODUCT LIABILITY INDEMNIFICATION.

          (a)  NEITHER ECC NOR ITS LICENSOR OF THE TECHNOLOGY MAKE OR GIVE,
AND THEY HEREBY EXPRESSLY DISCLAIM ANY AND ALL WARRANTIES, WHETHER EXPRESS OR
IMPLIED, WRITTEN OR ORAL, INCLUDING BUT NOT LIMITED TO THE WARRANTIES OF
MERCHANTABILITY AND OF FITNESS FOR A PARTICULAR PURPOSE, IN REGARD TO ANY
PRODUCTS WHICH MAY BE MANUFACTURED, USED OR SOLD BY SUBLICENSEE AND WHICH ARE
BASED UPON OR UTILIZE THE TECHNOLOGY. Sublicensee acknowledges and agrees
that neither ECC nor its licensor of the Technology have previously made or
presently make any of the foregoing warranties or representations.
Sublicensee will indemnify and hold ECC and its licensor of the Technology
harmless from and against, and hereby assumes liability for the payment of
any and all loss, liability or damage, and for all costs and expenses
(including reasonable costs of investigations and reasonable attorneys,
accountants, and expert witness fees) that may be imposed upon, suffered or
incurred by, or asserted against ECC or its licensor of the Technology as a
consequence of or in connection with any liability relating to any Product
which is manufactured, used or sold by Sublicensee, except to the extent that
the liability arises from the Technology licensed hereunder.  In the event
any action, suit or proceeding is brought against ECC or its licensor of the
Technology with respect to which there may be indemnity pursuant to this
paragraph 9, the defense of such action, suit or proceeding (including all
settlements and arbitrations, trials, appeals or other proceedings) shall be
conducted by Sublicensee at its sole cost and expense through legal counsel
selected by Sublicensee.  ECC and its licensor of the Technology shall have
the right to participate in such defense at their own expense through legal
counsel of their choice.  If Sublicensee fails to defend any such action,
suit or proceedings, for any reason, such failure shall constitute a material
breach of this Agreement by Sublicensee and ECC or its licensor of

                                       16


<PAGE>
the Technology may undertake defense of such action, suit or proceeding,
through legal counsel of their choice, at the sole cost and expense or
Sublicensee.  The parties shall make available to one another, their legal
counsel and accountants, all information and documents reasonably available
to them which relate to such action, suit or proceeding and shall render such
other assistance as they may reasonably require of one another in order to
insure the proper and adequate defense of any such action, suit or proceeding.

          (b)  In addition to the indemnification provided by paragraph 9(a)
hereof, Sublicensee shall obtain, and shall maintain during the entire term
of this Agreement, a product liability insurance policy with a reputable
insurance carrier reasonably acceptable to ECC.  Such policy shall provide
Sublicensee product liability coverage in an amount typical  for the
industry, for Products which are manufactured, used or sold by Sublicensee. 
Such product liability insurance policy shall name ECC and its licensor of
the Technology as an additional insureds and shall provide that ECC will be
given thirty (30) days prior written notice of any termination or
cancellation of the policy.  Upon ECC's request, Sublicensee shall provide
ECC with a copy of such policy and of all amendments or modifications
thereto.  Sublicensee shall be required to obtain and maintain the product
liability insurance policy called for by the foregoing provisions of this
paragraph 9(b) only from and after the date of the first commercial sale of a
Product by Sublicensee, or the first public testing of a Product by
Sublicensee.

     10.  ADDITIONAL DUTIES OF THE SUBLICENSEE.  In addition to, and not
in limitation of, the other duties and obligations of Sublicensee, as set
forth in this Agreement, Sublicensee shall:

          (a)  Use all commercially reasonable efforts to diligently exploit
the Sublicense by developing a commercial manufacturing capacity for the
Products and by actively manufacturing, marketing, advertising and selling
the Products within the Territory.

                                       17

<PAGE>

          (b)  Prominently display and utilize the principal Trademark or
Trademarks (whether owned by or licensed to ECC), as designated by ECC from
time to time, in connection with the advertisement, marketing, distribution
and sale of the Products.  The right to use such designated Trademark or
Trademarks will automatically be included within the Sublicense herein
granted.  "Sublicensee,  unless waived by ECC, shall use its best efforts to
cause each Product manufactured by Sublicensee to bear at least one of the
Trademarks designated by ECC.  The specific placement, size, and detail of
the Trademark on each Product must be approved by ECC, but shall not be
required to be placed on a Product in such a size, placement, detail or
configuration so as to impair the marketability of the Product.  In
connection with the use of such licensed marks, Sublicensee shall not in any
manner represent that it has any ownership interest therein.  Sublicensee
acknowledges that use of the Trademarks shall not create in its own favor any
right, title, or interest in or to the Trademarks, but that all uses of these
marks by Sublicensee shall inure to the benefit of ECC or its licensor of the
Trademarks.  Sublicensee shall cooperate with ECC or its licensor of the
Trademarks in the execution of any appropriate and necessary documents in
connection with the registration of any Trademarks.  Upon termination of this
Agreement, Sublicensee shall cease and desist from use of the Trademarks in
any way, including any word or phrase that is similar to or likely to be
confused with such marks.  However, in the event of termination, Sublicensee
shall have the right to sell existing stock and inventory of manufactured
Products for a period of one hundred and eighty days and thereafter shall
deliver to ECC or its duly authorized representative all materials upon which
the Trademarks appear.

          (c)  Not challenge or impugn the validity or ownership of the
Trademarks.

          (d)  Continue to make all required payments under this Agreement to
ECC during any challenge of the validity of any of the patents (or claims
thereof) issued in connection with the Technology.  In the event Sublicensee
terminates such payments based

                                       18

<PAGE>
upon or in connection with such a challenge, ECC may at its option terminate
this Agreement upon written notice to Sublicensee. 

          (e)   If Sublicensee is a publicly traded corporation or is
otherwise required to publicly disseminate its financial statements,
Sublicensee shall provide ECC with annual financial reports of Sublicensee
which are published and detail Sublicensee's annual earnings and statement of
net worth for the preceding calendar or fiscal year.  If no published reports
then special report of sales of Products and Gross Sales Price of the same.
     
     11.  REPRESENTATIONS AND WARRANTIES OF ECC.  ECC hereby represents and
warrants to Sublicensee that:

          (a)  ECC is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware.  ECC has all requisite
power and authority to own, operate and lease its properties and to carry on
its business as now being conducted, and is duly qualified to do business in
every jurisdiction wherein the nature of the business conducted or the assets
owned or leased by it make such qualification material to the conduct of its
business.
     
          (b)  ECC has all requisite power and authority to enter into this
Agreement and to perform its obligations hereunder including but not limited
to the right to sublicense the Technology.  This Agreement has been duly and
validly authorized, executed and delivered by ECC and assuming the due
authorization, execution and delivery by Sublicensee is the legal, valid and
binding obligation of ECC, enforceable against it in accordance with its
terms, subject only to bankruptcy, insolvency, reorganization, moratorium and
other laws relating to or affecting creditors' rights generally and to
general principles of equity.

          (c)  ECC has made no assignments, grants, licenses, encumbrances,
obligations or agreements which are in conflict with this Agreement.

                                       19

<PAGE>

          (d) To the best knowledge of ECC, no person, firm or entity has made
any claims or threatened, in writing, or otherwise, that ECC is in violation of
or has infringed any patent, patent license, trade name, trademark, service mark
brand mark, brand name, copyright, know-how, formula or other proprietary or
trade rights of such third party as they relate to the Technology.  ECC is not
now in possession of and at no time has received any information which would
render any claims essential to the commercial utilization of the Technology
invalid and/or unenforceable.  To the best of ECC's present knowledge and
belief, the use of the Technology in the manufacture of the Products pursuant to
the terms of this Agreement will not constitute infringement of the proprietary
rights of any third party.

          (e)  The execution, delivery and performance of this Agreement by ECC
and the consummation by it of the transactions contemplated hereunder, do not
and will not conflict with or result in a breach or termination of any term or
provision of, or constitute a default under any other agreement, or result in
the creation of any lien, charge or encumbrance upon any of its properties or
assets pursuant to any corporate charter, bylaw, mortgage, deed of trust,
indenture or other agreement or instrument, or any order, judgment, decree or
like restriction, statute or regulation by which it or any of its assets and
properties may be bound.  The representation and warranty given in this
paragraph 11(e) shall not be deemed or construed to expand or modify the
representation and warranty given by ECC in paragraph 11(d) hereof.

          (f)  The execution, delivery and performance of this Agreement by ECC
and the consummation by it of the transactions contemplated hereby will not (i)
constitute a violation (with or without the giving of notice or lapse of time)
of any provision of applicable law, (ii) require any consent, approval or
authorization of any person or governmental authority, (iii) result in a default
under, acceleration or termination of, or the creation in any party of the right
to accelerate, terminate, modify or cancel any agreement, lease, franchise,
permit, note or other restriction, encumbrance, obligation or liability to     

                                       20

<PAGE>

which ECC is a party or by which it is bound or to which any of its assets are
subject, (iv) result in the creation of any lien or encumbrance upon ECC's
assets, (v) conflict with or result in the breach of or constitute a default
under any provision of ECC's certificate of incorporation or bylaws, or (vi)
conflict with, result in a tortious interference as a result of such conflict
with, or otherwise violate, any contract or arrangement between ECC and any
other person.  The representation and warranty given in this paragraph 11(f),
shall not be deemed or construed to expand or modify the representation and
warranty given by ECC in paragraph 11(d) hereof.

          (g)  Neither ECC, nor anyone acting on its behalf, has taken any
action relating to any broker, finder, consultant or other expert which could
result in the imposition upon the Sublicensee of any obligation to pay a fee to
any broker, finder, consultant or similar expert in connection with the
transactions contemplated hereby.

          (h)  ECC has the full right and power to grant to Sublicensee this
sublicense to use the Technology in the manufacture, sale and distribution of
the Products. 
    
     12.  REPRESENTATIONS AND WARRANTIES OF SUBLICENSEE. Sublicensee hereby
represents and warrant to ECC that:
    
          (a)  Sublicensee is a Corporation duly organized, validly existing and
in good standing under the laws of the State of New York. Sublicensee has all
requisite power and authority to own, operate and lease its properties and to
carry on its business as now being conducted, and is duly qualified to do
business in every jurisdiction wherein the nature of the business conducted or
the assets owned or leased by it make such qualification material to the conduct
of its business.
     
          (b)  Sublicensee has all requisite power and authority to enter into
this Agreement and to perform its obligations hereunder.  This Agreement has
been duly and validly authorized, executed and delivered by Sublicensee and
assuming the due authorization, execution and delivery by ECC, is a legal, valid
and binding obligation of Sublicensee, enforceable against it in accordance with
its terms, subject only to bankruptcy, insolvency,

                                       21

<PAGE>

reorganization, moratorium and other laws relating to or affecting creditors'
rights generally and to general principles of equity.

          (c)  The execution, delivery and performance of this Agreement by
Sublicensee, and the consummation by it of the transactions contemplated
hereunder, do not and will not conflict with or result in a breach or
termination of any term or provision of, or constitute a default under, any
other agreement, or result in the creation of any lien, charge or encumbrance
upon any of its properties or assets pursuant to any charter or similar
document, mortgage, deed of trust, indenture or other agreement or
instrument, or any order, judgment, decree or like restriction, statute or
regulation by which it or any of its assets and properties may be bound.

          (d)  The execution, delivery and performance of this Agreement by
Sublicensee and the consummation by it of the transactions contemplated
hereby will not (i) constitute a violation (with or without the giving of
notice or lapse of time) of any provision of applicable law, (ii) require any
consent, approval or authorization of any person or governmental authority,
(iii) result in a default under, acceleration or termination of, or the
creation in any party of the right to accelerate, terminate, modify or cancel,
any agreement, lease, franchise, permit, note or other restriction,
encumbrance, obligation or liability to which Sublicensee is a party or by
which it is bound or to which any of its assets are subject, (iv) result in
the creation of any lien or encumbrance upon Sublicensee assets, (v) conflict
with or result in the breach of or constitute a default under any provision
of Sublicensee's charter documents, or (vi) conflict with, result in tortious
interference as a result of such conflict with, or otherwise violate, any
contract or arrangement between ECC and any other person.  ECC is not now in
possession of and at no time has received any information which should render
any claims essential to the commercial utilization of the Technology invalid
and/or unenforceable.  To the best of ECC's present knowledge and belief the
use of the Technology in the manufacture of the

                                       22

<PAGE>

Products pursuant to the terms of this Agreement will not constitute
infringement of the proprietary rights of any third party.


          (e)  Neither Sublicensee, nor anyone acting on its behalf, has taken
any action relating to any broker, finder, consultant or other expert which
could result in the imposition upon ECC of any obligation to pay a fee to any
broker, finder, consultant or similar expert in connection with the
transactions contemplated hereby.


     13.  SURVIVAL OF REPRESENTATIONS AND WARRANTIES.  The representations
and warranties of the parties, as set forth herein, shall be true and
accurate as of the effective date of this Agreement, and shall survive the
execution of this Agreement. 

     14.  INDEMNIFICATION.  In addition to the indemnification provisions
provided elsewhere in this Agreement:

          (a)  ECC will indemnify and hold Sublicensee harmless from and
against, and hereby assumes liability for, the payment of any loss, liability
or damage, and for all costs and expenses (including reasonable costs of
investigation and reasonable attorneys, accountants and expert witness fees)
(collectively "Losses") of whatsoever kind and nature that may be imposed
upon, suffered or incurred by Sublicensee as a consequence of or in
connection with any misrepresentation or breach of any warranty, covenant or
agreement of ECC contained in this Agreement.

          (b)  Sublicensee will indemnify and hold ECC harmless from and
against, and hereby assumes liability for, the payment of all Losses of
whatsoever kind and nature that may be imposed upon, suffered or incurred by
or asserted against ECC as a consequence of or in connection with any
misrepresentation or breach of any warranty, covenant or agreement of
Sublicensee contained in this Agreement.
 
          (c)  Neither party shall have any liability to the other party
pursuant to an indemnity provided by this paragraph 14 unless and until the
aggregate amount of all indemnified Losses suffered or incurred by such
indemnified party after the effective date hereof equals or exceeds
$100,000, at which time the indemnifying party shall be obligated

                                       23

<PAGE>

to pay the indemnified party the full amount of all indemnified Losses,
including such initial $100,000 in Losses.  The amount of indemnity payable
pursuant to this paragraph 14 shall be calculated after giving effect to any
insurance proceeds actually received by the indemnified party; provided that
neither party shall subrogate to any insurance carrier any rights or claims
which it may have against the other party.

     15.  CONFIDENTIALITY.

          (a)  Sublicensee acknowledges that ECC claims that the Technology,
as it may exist from time to time as well as the other confidential or
proprietary information (including business and financial information) of ECC
(whether owned by ECC or acquired by license from third parties) are and
shall remain the valuable, special, unique and proprietary assets of ECC, and
shall constitute "Confidential Information" hereunder.  In order for any
information other than the Technology to be deemed to be "Confidential
Information" hereunder, whether disclosed orally or in writing, it must be
identified, orally or in writing, to Sublicensee as "Confidential
Information" at time of disclosure, or reasonably  thereafter, or be
reasonably understood by Sublicensee to be "Confidential Information." 
Additionally, as used herein, "Confidential Information" shall not include
any information or data which Sublicensee can show: (i) is in, or becomes a
part of, the public domain by any means other than the failure by Sublicensee
to fulfill its obligations hereunder, or (ii) is rightfully known to
Sublicensee at the time of disclosure by ECC; or (iii) is, at any time,
disclosed to Sublicensee by a third party who has received and disclosed such
information without the breach of any obligation of confidentiality to ECC or
to any third party assignor of such Confidential Information.  For purposes
of this paragraph 15(a), information shall not be deemed to be part of the
public domain or in Sublicensee's knowledge merely because it may be embraced
in a more general disclosure or simply because it may be derived from
combinations of disclosures or information generally available to the public
or within Sublicensee's knowledge.  The parties acknowledge that disclosure
to Sublicensee of Confidential Information will be necessary in order to
enable

                                       24

<PAGE>

Sublicensee to utilize the Sublicense in the manner contemplated by this
Agreement, and ECC will make such disclosures of the Confidential Information
to Sublicensee as is necessary, required or appropriate in that regard.  To
the extent that the disclosure of such Confidential Information is deemed to
be a transfer of the Technology licensed hereunder, such Technology transfer
shall be carried out pursuant to the provisions of paragraph 31 hereof.  The
parties acknowledge that they have a confidential relationship with one
another and accordingly Sublicensee shall maintain all Confidential
Information disclosed to it pursuant to this Agreement in confidence and
shall not disclose the same to any third party (with the exception of its
employees, accountants, attorneys and other agents and professional advisors)
either during or after the term of this Agreement unless required to do so by
court order or by law, in which case Sublicensee shall notify ECC, in
writing, prior to making such disclosure and shall cooperate with ECC to
preserve and protect the confidentiality of the Confidential Information in
question to the fullest extent possible. Additionally, except as specifically
contemplated by this Agreement, Sublicensee shall not utilize any
Confidential Information for its own benefit or for the benefit of any third
party.  Prior to making any permitted disclosure of any Confidential
Information to its employees, accountants, attorneys and other agents and
professional advisors, Sublicensee shall require such persons, firms, or
entities to execute and deliver written disclosure agreements which shall
obligate such persons, firms and entities to comply with the same obligations
of confidentiality and non-use as imposed upon Sublicensee in this paragraph
15(a).

          (b)  From time to time during the term of this Agreement,
Sublicensee may disclose to ECC certain information which Sublicensee deems
to be proprietary and confidential, including but not limited to business
plans, marketing plans, financial information, and process technology (the
"Sublicensee Confidential Information").  The definition of "Sublicensee
Confidential Information," and ECC's use and disclosure thereof, shall be
governed by terms and conditions identical to those which govern

                                       25

<PAGE>

Confidential Information, as set forth in paragraph 15(a) hereof; provided
that ECC shall have the right to disclose Sublicensee Confidential
Information to ECC's licensor of the Technology subject to its accepting and
treating it as Confidential Information.

          (c)  Each party specifically acknowledges that it would be
difficult to fully compensate the other party in damages for the breach of
the obligations of confidentiality set forth in paragraph 15(a) or 15(b)
hereof and, accordingly, each party consents that the other party may obtain
temporary and permanent injunctive relief to enforce confidentiality
obligations and that such relief may be granted without the necessity of
proving actual damages or irreparable harm.  The provisions of the paragraph
15(c) with respect to injunctive relief shall not, however, diminish the
right of the non-breaching party to claim and recover damages in any
proceeding initiated pursuant to paragraph 26 hereof.

     16.  TERM AND TERMINATION.

          (a)  The term of this Agreement shall commence upon the effective
date hereof.  Unless sooner terminated as hereinafter provided, this
Agreement shall continue in full force and effect until the expiration of the
last material and substantial United States patent covering the Technology
which is utilized by Sublicensee, or for so long as Sublicensee produces a
Product which utilizes material and substantial proprietary information or a
material and substantial Trade Secret of ECC.  Any dispute as to the term of
this Agreement shall be resolved by arbitration pursuant to paragraph 26 of
this Agreement.     

          (b)  The Sublicense may be terminated, at any time, by the mutual
written consent of the parties hereto.

          (c)  Sublicensee may terminate this Agreement, at any time, upon
sixty (60) days' prior written notice of such termination to ECC.

          (d)  If Sublicensee is in breach of any of its material obligations
hereunder, then ECC may give Sublicensee written notice of such breach.  If
such breach is

                                       26

<PAGE>

not cured within ninety (90) days from the date such written notice is
delivered, or if such default can not be cured within such ninety day period
but the Sublicensee has taken action to cure such default then if the default
is not cured within one year from the date of such notice, ECC shall have the
right to immediately terminate the Sublicense by written notice to the
Sublicensee.
 
          (e)  If a bankruptcy reorganization proceeding, not including a
voluntary proceeding under Chapter 7 of the U.S. Bankruptcy Code, shall be
commenced by or an involuntary proceeding be commenced against the
Sublicensee, this Sublicense shall terminate effective as of the date of such
filing, unless the Sublicensee shall assume such Sublicense in accordance
with the provisions of the U.S. Bankruptcy Code, including, but not limited
to, Section 11 U.S.C. 365, and any applicable court order.

          (f)  Subject to the provisions of paragraph 27 (force majeure) ECC
shall have the right, at its sole discretion, to terminate the Sublicense,
upon thirty (30) days written notice to Sublicensee, in the event that the
amount of the Royalty payment for any calendar year is not at least 50% of
the Royalty payment amount for the preceding calendar year.

     17.  EFFECT OF EXPIRATION OR TERMINATION.

          (a)  From and after the effective date of the expiration of the
term of this Agreement or the termination of the Sublicense pursuant to
paragraph 16 hereof, Sublicensee shall have no right, whatsoever, to utilize
the Technology, (except for Improvements to which Sublicensee has the right
to continued use as provided in paragraph 6) or the Trademarks pertinent to
this Agreement, and shall return to ECC all copies of Confidential
Information which is then in the possession of Sublicensee. Provided,
however, that nothing contained herein shall or shall be deemed to restrict
the Sublicensee's ability or right to use, free of Royalty, any Technology,
trade name, know-how or confidential information which is or has come into
the Public Domain through no fault of Sublicensee and is not otherwise deemed
Confidential Information.

                                       27

<PAGE>

          (b)  The obligation of Sublicensee to pay to ECC the Royalty for
all Products actually sold by Sublicensee prior to the effective date of
the expiration or termination of this Agreement, as well as the obligations
concerning product liability set forth in paragraph 9 hereof and of
confidentiality set forth in paragraph 15 hereof, shall survive the
expiration or termination of the Sublicense and of this Agreement.

     18.  MARKING AND UNITED STATES EXPORT CONTROL.

          (a)  Sublicensee shall mark all of the Products and related
documents with the applicable United States patent numbers, as required by
applicable law, or as instructed by ECC; provided, however, that nothing
contained herein shall prohibit or restrict the Sublicensee's right by
administrative proceeding or otherwise to limit the inclusion of such patent
numbers.
     
          (b)  Sublicensee shall comply with all applicable laws, rules and
regulations of the United States, including but not limited to the Export
Regulations of the United States Department of Commerce, in connection with
the direct or indirect export of any of the Technology or Products. 
Sublicensee acknowledges that ECC has not made and does not make any
representation that any license is or is not required in connection with such
export or, if required, that such license will be issued by the United States
Department of Commerce, provided, however, that ECC shall apply for all
licenses required or necessary to enable the Sublicensee to export the
Products or Technology within the Territory without imposing any additional
Royalty.
 
     19.  SPECIAL TAX PROVISIONS.  Sublicensee or its agents shall be solely
responsible for the payment and discharge of any taxes, duties, or
withholdings relating to any transaction of Sublicensee or its agents in
connection with the manufacture, use, sale or commercialization of the
Technology or the Products; except that ECC shall be responsible for taxes,
duties or withholding relating to the payment to ECC of any Royalty payment
under this Agreement and Sublicensee shall be permitted to perform any
withholding with respect to such payments and fees required by law or
regulation.

                                       28

<PAGE>

     20.  RELATIONSHIP OF THE PARTIES. This Agreement shall not create any
partnership, joint venture or similar relationship between the parties hereto
(or ECC's Affiliates) and no representation to the contrary shall be made by
either party.  Neither party shall have any authority to act for or on behalf
of or to bind the other party in any fashion, and no representation to the
contrary shall be made by either party.

     21.  NOTICES.  Any notice which is required or permitted to be given to
ECC or Sublicensee pursuant to this Agreement shall be deemed to have been
given only if such notice is reduced to writing and delivered personally, or
by United States mail with postage prepaid and return receipt requested, or
by telecopier (FAX) transmission, confirmed by letter United States mail with
postage prepaid and return receipt requested, or by reputable overnight
courier (pursuant to instructions requiring next-day delivery) to the person
in question as set forth below:

     ECC:                     EarthShell Container Corporation
                              800 Miramonte Drive
                              Santa Barbara, California 93109-1419
                              Attention: Mark A. Koob
                              Fax: (805) 897-2298

     Sublicensee:             Mobil Chemical Company
                              1159 Pittsford-Victor Road
                              Pittsford, New York 14534-3876
                              Attention: D. M. Davies
                              Fax:   (716) 248-1309

ECC or Sublicensee may change its address by giving notice of such change in
the manner set forth herein.  If delivered personally, a notice shall be
deemed delivered when actually received at the address specified herein.  Any
notice given by mail shall be deemed delivered three (3) days following the
date upon which it is deposited in the mail, with postage prepaid and return
receipt requested.  Any notice given by FAX shall be deemed delivered on the
date it is actually transmitted to the person in question at the FAX number

                                       29


<PAGE>

specified above.  Any notice given by overnight courier shall be deemed
delivered on the next business day following the date it is placed in the
possession of such courier.

     22.  ENTIRE AGREEMENT.  This Agreement supersedes any prior
understandings or agreements, whether written or oral, and any contemporaneous
oral agreements, between the parties hereto in regard to the subject matter
hereof and contains the entire agreement between the parties in regard to the
subject matter hereof. This Agreement may not be changed or modified orally,
but only by an agreement, in writing, signed by both the parties hereto. 
Nothing contained in this Agreement shall be deemed or construed to
supersede, modify or amend the License Agreement.

     23.  SAVINGS CLAUSE.  Should any part or provision of this Agreement be
rendered or declared invalid by reason of any law or by decree of a court of
competent jurisdiction, the invalidation of such part or provision of this
Agreement shall not invalidate the remaining parts or provisions hereof, and
the remaining parts and provisions of this Agreement shall remain in full
force and effect. 

     24.  WAIVER.  Neither the failure or delay on the part of either party
to exercise any right, power or privilege hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or
privilege preclude any other or further exercise thereof or of any other
right or privilege.
 
     25.  GOVERNING LAW.  This Agreement shall be governed by and construed
in accordance with the laws of the State of California, without giving
effect to the choice of law rules thereof.

     26.  ARBITRATION.  Except as otherwise provided in paragraphs 5(c) or
15, any dispute or controversy which shall arise under or in connection with
any aspect of this Agreement, including but not limited to any aspect of the
Sublicense, the performance or nonperformance of any obligation set forth
herein, or the interpretation hereof shall be resolved through binding
arbitration conducted in accordance with the commercial arbitration rules of
the American Arbitration Association, although the parties may, by

                                       30

<PAGE>

agreement, elect to have such proceeding conducted by or through an entity or
individuals other than the American Arbitration Association itself.  Such
arbitration shall be conducted in Santa Barbara, California before a panel
of three arbitrators. The decision of the arbitrators shall be final and
binding upon the parties, shall not be subject to appeal or review by any
court or governmental agency and shall be enforceable in the appropriate
United States state and federal courts.  The arbitrators in any arbitration
proceeding shall have the right, in addition to any award of damages, to
award the prevailing party all costs and expenses, including reasonable
attorneys' fees and reasonable investigation costs, incurred by such party in
connection with such arbitration and all aspects of the dispute which is the
subject of such arbitration.  If at the time any dispute arises the parties
agree to submit the dispute to binding mediation rather than arbitration they
may do so.

     27.  FORCE MAJEURE.
 
          (a)  The failure of either party to perform its obligations under
this Agreement (except the obligation to make payments) shall not subject
such party to any liability to the other or subject this Agreement to
termination if such failure is caused by acts such as, but not limited to,
acts of God, strikes, fire, earthquake, explosion, flood, drought, war, riot,
sabotage, embargo, compliance with any order or regulation of any
governmental entity acting with color of right, intervention or delays
created by any regulatory authority, or by any other cause beyond the
reasonable control of the parties.  The party so affected shall promptly
notify the other party of the event of force majeure, and shall use all
reasonable efforts to remove such event as soon as reasonably practicable.

     28.  TIME OF ESSENCE.  The parties acknowledge that time is of the essence
in regard to every provision of this Agreement.

     29.  COUNTERPARTS.  This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

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<PAGE>

     30.  TERMINOLOGY.   As used in this Agreement, the singular shall
include the plural and the plural shall include the singular.  Titles of
sections and paragraphs in this Agreement are for convenience only, and
neither limit or amplify the provisions of the Agreement, and all references
in this Agreement to a section or paragraph shall refer to the
corresponding section or paragraph of this Agreement unless specific
reference is made to the sections of another document or instrument.  The
term Sublicensee shall include the Sublicensee or its permitted Assignee(s)
as applicable.

     31.  TECHNOLOGY TRANSFER, PRODUCT DESIGN AND QUALITY CONTROL.

          (a)  To further promote the transfer of Technology licensed
hereunder, Arthur D. Little, Inc. ("ADL") has agreed to act as an independent
contractor and consultant to work with Sublicensee in implementing the
transfer of the licensed Technology, assisting Sublicensee with the
installation and modification of the requisite processing equipment and
assisting Sublicensee with product design and quality control matters.  In
all these areas Sublicensee may work directly with and through ADL.  In lieu
of the foregoing, Sublicensee may use its internal professional staff, or
another outside consultant, subject to the prior approval of ECC, which
approval shall not be unreasonably withheld; provided, however, that any such
outside consultant shall be required to execute a confidentiality agreement
substantially as contemplated under paragraph 15 hereof with respect to any
disclosed Technology or other proprietary information of ECC.  The specific
scope, terms and conditions of the support services to be provided by ADL as
contemplated hereunder shall be set forth in a Technology Transfer Agreement
to be entered into within one hundred eighty (180) days following the date of
execution of this Agreement by and between ECC, ADL and Sublicensee.  The
Technology Transfer Agreement shall also provide for Quality Control Audits,
as defined and agreed to in the Technology Transfer Agreement, to be
periodically performed by ADL.  If ECC approves the internal professional
staff of Sublicensee to carry out the transfer of Technology and to supervise
the required quality control procedures, this will be set forth in the
Technology Transfer Agreement between

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<PAGE>

ECC and Sublicensee.  If for any reason a mutually agreeable Technology
Transfer Agreement is not entered into within this period, either party may
terminate this Agreement upon written notice within 30 days after the
expiration of the 180-day period and the parties shall have no further
liability or obligation hereunder (including but not limited to any liability
on the part of ECC to reimburse Sublicensee for any moneys, resources, or
damages incurred or expended before or after the execution of this
Agreement), except that both parties shall have a continuing duty and remain
liable for damages related to the ongoing duty regarding Confidential
Information.

          (b)  Within one hundred eighty (180) days after the execution of
this Agreement, but not before execution of the Technology Transfer
Agreement, ECC shall prepare a disclosure sufficient to teach one of ordinary
skill in the art how to use the Technology in order to manufacture the
Products.  It is contemplated that this disclosure shall include the
formulas, procedures and research data necessary to implement the Technology
for the manufacture of the Products.

     32.  MATERIALS SUPPLY.  Within one hundred eighty (180) days following
the execution of this Agreement, but not before execution of the Technology
Transfer Agreement, ECC will submit to Sublicensee either a list of approved
suppliers of the requisite materials or a list of one or more approved
suppliers of prepackaged materials for use in the production of the licensed
Products.  If Sublicensee desires to have other suppliers added to this list,
Sublicensee shall submit the same to ECC who in turn will verify that such
supplier or suppliers have the capability to furnish materials meeting ECC's
specifications, and if said supplier or suppliers are able to do so, then
they will be added to the approved list.  If for any reason this information
is not sufficient to satisfy Sublicensee's need to establish acceptable
sources of the requisite materials, Sublicensee may terminate this Agreement
and neither party will have any further liability or obligation hereunder
except for the ongoing duty regarding Confidential Information. 

                                       33

<PAGE>

     33.  MCDONALD'S CORPORATION.  Because of work jointly undertaken by ECC
and McDonald's Corporation ("McDonald's") (as used herein the term
"McDonald's" shall include franchisees thereof) with regards to studies of
market potential and Food Package design, it has been agreed that McDonald's
is to have a "lead time" or "priority" with regard to the distribution of
certain Products that are ordered by it and covered by this Sublicense
Agreement.  Prior to the execution of the Technology Transfer Agreement, ECC
will deliver to Sublicensee a list of these priority Products.  In compliance
with this arrangement, it is expressly understood and agreed that, for a
period of two (2) years from the date hereof, the license hereby granted is
subject to Sublicensee agreeing not to fill orders from, or deliver any
priority Products to, on a region by region basis, any entity in the food
service or fast food industry other than McDonald's until such time as all
such priority Products ordered for McDonald's in a specific region have been
manufactured, shipped or otherwise set aside for delivery to McDonald's by
the Sublicensee.  A region shall be that geographical area which is
serviced by a specific "distribution center" which supplies products solely
or primarily to McDonald's in that geographical area.

     34.  DOMESTIC SUBLICENSES.  ECC agrees that all domestic sublicenses
(within the United States of America) granted by it will contain
substantially the same terms and conditions so that no domestic sublicensee
will gain a material advantage over another domestic sublicensee by virtue of
the sublicense agreement including any letter agreements or letter of
clarification issued or entered into in connection with any such sublicense. 


     35.  PRODUCT DEFECTS.    Should any Products manufactured, sold or
otherwise commercialized by Sublicensee contain any material defect in its
appearance or function, Sublicensee shall cease any further manufacture, sale
or other commercialization of such Products containing such material defect.
Unless Sublicensee corrects such defect within a reasonable time following
its discovery by or disclosure to Sublicensee, Sublicensee shall be in breach
of a  material obligation of this Agreement.
 
                                       34

<PAGE>

      IN WITNESS WHEREOF, the parties have caused this Sublicense Agreement
to be executed and delivered by their duly authorized representatives upon
the date first herein written.




ECC:                                         SUBLICENSEE:


EarthShell Container Corporation             Mobil Chemical Company



By:  /s/ Mark A. Koob                        By:  /s/ D. M. Davies     10/4/93
     ----------------------------------           -----------------------------
     Mark A. Koob                                 D. M. Davies

Its: President                               Its: V.P. New Business Development,
                                                  -----------------------------
                                                  Resin and Environmental


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<PAGE>

                                    EXHIBIT A



I.   TECHNOLOGY.

     The term "Technology" as defined in paragraph 1(f), includes the
technology within the scope of the following issued patents and patent
applications which have been filed as of the execution date of this
Agreement, but only to the extent that such technology has been licensed to
ECC and is directly utilized in the "Field of Use".  The patents and patent
applications identified in this Exhibit "A" are merely to identify the
proprietary technology reference in paragraph 1(f); nothing in this Exhibit
"A" is otherwise intended to expand the scope of the definition of
"Technology" as defined in paragraph 1(f).



 
     1.   ISSUED UNITED STATES LETTERS PATENTS


1.   U.S. Letters Patent No. 4,225,247 issued September 30, 1980, and entitled
     "mixing and Agitating Device."

2.   U.S. Patent No. 4,552,463 issued November 12, 1983, and entitled "Methods
     and Apparatus for Producing a Colloidal Mixture."

3.   U.S. Letters Patent No. 4,889,428 issued December 26, 1989, and entitled
     "Rotary Mill for Increasing the Degree of Hydration." 

4.   U.S. Letters Patent No. 4,944,595 issued July 31, 1990, and entitled
     "Apparatus for Producing Cement Building Material." 

5.   U.S. Letters Patent No. 5,061,319 issued October 29, 1991, and entitled
     "The Process for Producing Cement Building Material." 

6.   U.S. Letters Patent No. 5,169,566 issued December 8, 1992, and entitled
     "Engineered Cementitious Contaminant Barriers and Their Method of
     Manufacture."



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<PAGE>

     2.   PENDING UNITED STATES PATENT APPLICATIONS

    
7.   U.S. Patent Application Serial No.07/418,027 filed October 10, 1989, and
     entitled "Process for Producing Improved Building Material and Product
     Thereof."

8.   U.S. Patent Application Serial No. 08/050,705 filed April 21, 1993, and
     entitled "Methods of Manufacture and Use For Low Density Hydraulically
     Bonded Cement Compositions."

9.   U.S. Patent Application Serial No. 07/929,898 filed August 11, 1992, and
     entitled "Cementitious Food and Beverage Storage, Dispensing, and Packaging
     Containers and the Methods of Manufacturing Same."

10.  U.S. Patent Application Serial No. 07/981,615 filed November 25, 1992, and
     entitled "Methods of Manufacture and Use For Hydraulically Bonded Cement."

11.  U.S. Patent Application Serial No. 07/982,383 filed November 25, 1992, and
     entitled "Food and Beverage Containers Made from Inorganic Aggregates and 
     Polysaccharide, Protein, or Synthetic Organic Binders, and the Methods of 
     Manufacturing Such Containers."

12.  U.S. Patent Application Serial No. 08/019,151 filed February 17, 1993, and
     entitled "Cementitious Materials for Use in Packaging Containers and their
     Methods of Manufacture."

13.  U.S. Patent Application Serial No. 08/018,773 filed February 17, 1993, and
     entitled "Cementitious Materials for Use in Cushioning, Spacing,
     Partitioning, Portioning or Wrapping Objects and the Methods of
     Manufacturing Such Materials."
 
14.  U.S. Patent Application Serial No. 08/027,451 filed March 8, 1993, and
     entitled "Laminate Insulation Barriers Having a Cementitious Structural
     Matrix and Methods for Their Manufacturing."

15.  U.S. Patent Application Serial No. 08/027,404 filed March 8, 1993, and
     entitled "Highly Insulative Cementitious Matrices and Method For Their
     Manufacture."

16.  U.S. Patent Application Serial No. 08/095,662 filed July 21, 1993, and
     entitled "Hydraulically Settable Containers and other Articles for Storing,
     Dispensing, and Packaging Food and Beverages and Methods for their
     Manufacture."

17.  U.S. Patent Application Serial No. 08/101,500 filed August 3, 1993, and
     entitled "Methods and Apparatus for Manufacturing Moldable Hydraulically
     Settable Sheets Used in Making Containers, Printed Materials, and Other
     Objects." 

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<PAGE>

18.  U.S. Patent Application Serial No. 08/105,352 filed August 10, 1993 and
     entitled "Methods and Systems for Manufacturing Containers and other
     Articles of Manufacture from Hydraulically Settable Mixtures."


II.  TRADE SECRETS

     The term "Trade Secrets" as used in this Agreement shall include any
technical or business information, any invention, equipment or apparatus,
method or process, technology, know-how, trade secret, drawing, data,
evaluation, specifications, quality and inspection standards, sales
literature, report, business plan, memorandum, market study, customer lists,
training materials, computer program or software (including both source and
object code), or any other document or thing which is in whole or in part
confidential, proprietary, or secret and which is owned or controlled by,
licensed or assigned to ECC or for which ECC has the right to grant licenses
thereon during the term of this Agreement and which relates in whole or in
part to any of the following:

1.   The compositions, including the variable and preferred parameters for each
     component, used in Food Packages or the Technology based on hydraulically
     reacting materials.

2.   The processing steps, including the variable and preferred parameters for
     each step, used in the Technology.

3.   The equipment and apparatus used in the manufacture of the Technology.

4.   Quality control, testing and research and development data, reports, and
     information, including patent applications in preparation.

5.   Customers and suppliers of the components and equipment of the Technology,
     including any agreements.




                                    38











<PAGE>

                                    EXHIBIT B

                                     PRODUCT

                                PRIORITY PRODUCTS


1.   One and two-piece sandwich containers ("clam shells")












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