EXECUTION COPY

                            ASSET PURCHASE AGREEMENT


     THIS ASSET PURCHASE AGREEMENT is entered into on May 16, 2000 by and
between SD ACQUISITION INC., a Nebraska corporation (the "Buyer"), and
TRANSGENOMIC, INC., a Delaware corporation (the "Seller"). The Buyer and the
Seller are referred to herein individually as a Party and collectively as the
Parties.

     WHEREAS, the Buyer desires to purchase the assets, and assume certain
liabilities, of the Seller that are used by Seller in, or otherwise relate to,
the manufacture and sale of certain non-life science scientific instruments that
are marketed by the Seller under the CETAC Technologies brand (the "CETAC
Products"), and Seller desires to sell and convey such assets, subject to such
liabilities, all pursuant to the terms and conditions hereof;

     Now, therefore, in consideration of the premises and the mutual promises
herein made, and in consideration of the representations, warranties, and
covenants herein contained, the Parties agree as follows.

     1. DEFINITIONS.

     "ACQUIRED ASSETS" means all of:

          (a) the leaseholds in real property, including all amounts delivered
     to the lessor by Seller, representing a security deposit with respect to
     the leaseholds, and the improvements, fixtures, and fittings thereon
     described in Schedule 1.1 (the "Leases");

          (b) all raw materials, supplies, manufactured and purchased parts,
     goods in process and finished goods described in Schedule 1.2 (the
     "Inventory");

          (c) machinery, equipment, furniture, fixtures, vehicles, trailers,
     leasehold improvements and tools described in Schedule 1.3 (the "Fixed
     Assets");

          (d) the patents, patent applications, and patent disclosures
     (including all reissuances, continuations, continuations-in-part,
     revisions, extensions, and reexaminations thereof), trademarks, service
     marks, trade dress, logos, trade names, (including all translations,
     adaptations, derivations, and combinations thereof, all goodwill associated
     therewith, and all applications, registrations, and renewals in connection
     therewith), copyrights (including applications, registrations, and renewals
     in connection therewith) that are described in Schedule 1.4 hereof plus any
     trade secrets and confidential business information (including ideas,
     research and development, know-how, formulas, compositions, manufacturing
     and production processes and techniques, technical data, designs, drawings,
     specifications, customer and supplier lists, pricing and cost information,
     and business and marketing plans and proposals relating directly and
     exclusively to the manufacture and marketing of the CETAC Products and all
     tangible embodiments thereof (in whatever form or medium) (the
     "Intellectual Property");

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          (e) the agreements, contracts, instruments, security interests,
     guaranties, warranties and other intangible property rights described in
     Schedule 1.5 (the "Intangible Property");

          (f) the accounts, notes and other receivables relating to sales of the
     CETAC Products occurring after March 31, 2000 (the "Accounts Receivable");

          (g) the permits, licenses, orders, registrations, certificates,
     variances, and similar rights obtained from governments and governmental
     agencies relating to the manufacture and sale of the CETAC Products
     described in Schedule 1.6 (the "Permits");

          (h) the books, records, ledgers, files, documents, correspondence,
     lists, plats, architectural plans, drawings, and specifications, creative
     materials, advertising and promotional materials, studies, reports, and
     other printed or written materials relating to the CETAC Products (the
     "Documents"); and

          (i) all funds held in the Section 125 Employee Reimbursement Accounts
     for Healthcare and Dependent Care relating to the employees set forth in
     Schedule 3(n) and all related reports from the administrator relating to
     participants and their balances.

Acquired Assets shall not include any other asset other that those described
above and, specifically, shall not include (i) the corporate charter,
qualifications to conduct business as a foreign corporation, arrangements with
registered agents relating to foreign qualifications, taxpayer and other
identification numbers, seals, minute books, stock transfer books, blank stock
certificates, and other documents relating to the organization, maintenance, and
existence of the Seller as a corporation or (ii) any of the rights of the Seller
under this Agreement.

         "ASSUMED LIABILITIES" means only those Liabilities and obligations of
the Seller set forth in Schedule 1.7, including, specifically, all trade
liabilities incurred in connection with the manufacture of the CETAC Products
after March 31, 2000. Assumed Liabilities do not include (i) any Liability of
the Seller for unpaid Taxes for periods prior to the Closing Date, (ii) any
Liability of the Seller for income, transfer, sales, use, and other Taxes
arising in connection with the consummation of the transactions contemplated
hereby (including any income Taxes arising because the Seller is transferring
the Acquired Assets, (iii) any Liability of the Seller for the unpaid Taxes of
any Person other than the Seller under Treas. Reg. sec 1.1502-6 (or any similar
provision of state, local, or foreign law), as a transferee or successor, by
contract or otherwise, (iv) any obligation of the Seller to indemnify any Person
by reason of the fact that such Person was a director, officer, employee, or
agent of the Seller or was serving at the request of the Seller as a partner,
trustee, director, officer, employee, or agent of another entity (whether such
indemnification is for judgments, damages, penalties, fines, costs, amounts paid
in settlement, losses, expenses, or otherwise and whether such indemnification
is pursuant to any statute, charter document, bylaw, agreement, or otherwise),
(v) any Liability of the Seller for costs and expenses incurred in connection
with this Agreement and the transactions contemplated hereby, or (vi) any
Liability or obligation of the Seller under this Agreement.

     "BUYER" has the meaning set forth in the preface above.

     "BUYER NOTE" has the meaning set forth in Section 2(d) below.


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     "BUYER'S PLAN" has the meaning set forth in Section 4(f) below.

     "CERCLA" means the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended.

     "CETAC PRODUCTS" has the meaning set forth in the preface above.

     "CLOSING" has the meaning set forth in Section 2(f) below.

     "CLOSING DATE" has the meaning set forth in Section 2(f) hereof.

     "CODE" means the Internal Revenue Code of 1986, as amended.

     "CONFIDENTIAL INFORMATION" means any information concerning the Acquired
Assets or otherwise relating to the CETAC Products that is not already generally
available to the public.

     "DISCLOSURE SCHEDULES" has the meaning set forth in Section 3 hereof.

     "DWYER GUARANTEE" has the meaning set forth in Section 2(d) hereof.

     "ENVIRONMENTAL, HEALTH, AND SAFETY LAWS" means CERCLA, RCRA, and the
Occupational Safety and Health Act of 1970, as amended, together with all other
laws (including rules, regulations, codes, plans, injunctions, judgments,
orders, decrees, rulings, and charges thereunder) of federal, state, local, and
foreign governments (and all agencies thereof) concerning pollution or
protection of the environment, public health and safety, or employee health and
safety, including laws relating to emissions, discharges, releases, or
threatened releases of pollutants, contaminants, or chemical, industrial,
hazardous, or toxic materials or wastes into ambient air, surface water, ground
water, or lands or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport, or handling of
pollutants, contaminants, or chemical, industrial, hazardous, or toxic materials
or wastes.

     "FACILITY" has the meaning set forth in Section 2(b) below.

     "IPO" means the initial pubic offering of the Seller's common stock
pursuant to a registration statement declared effective under the Securities Act
of 1933, as amended.

     "KNOWLEDGE" means, with respect to any Party, the actual knowledge of the
officers or employees of such Party with responsibility for the matter in
question after reasonable investigation.

     "LENDERS" has the meaning set forth in Section 2(h).

     "LIABILITY" means any liability (whether known or unknown, whether asserted
or unasserted, whether absolute or contingent, whether accrued or unaccrued,
whether liquidated or unliquidated, and whether due or to become due), including
any liability for Taxes.

     "ORDINARY COURSE OF BUSINESS" means the ordinary course of business
consistent with past custom and practice (including with respect to quantity and
frequency).

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     "PARTY" has the meaning set forth in the preface above.

     "PERSON" means an individual, a partnership, a corporation, a limited
liability company, an association, a joint stock company, a trust, a joint
venture, an unincorporated organization, or a governmental entity (or any
department, agency, or political subdivision thereof).

     "PURCHASE PRICE" has the meaning set forth in Section 2(d) below.

     "RCRA" means the Resource Conservation and Recovery Act of 1976, as
amended.

     "SECURITIES ACT" MEANS the Securities Act of 1933, as amended.

     "SECURITY INTEREST" means any mortgage, pledge, lien, encumbrance, charge
or other security interest, other than (a) mechanic's, materialmen's, and
similar liens, (b) liens for Taxes not yet due and payable or for Taxes that the
taxpayer is contesting in good faith through appropriate proceedings, (c)
purchase money liens and liens securing rental payments under capital lease
arrangements, and (d) other liens which secure the performance of Assumed
Liabilities.

     "SELLER" has the meaning set forth in the preface above.

     "SELLER'S PLAN" has the meaning set forth in Section 3(n) below.

     "TAX" means any federal, state, local, or foreign income, gross receipts,
license, payroll, employment, excise, severance, stamp, occupation, premium,
windfall profits, environmental (including taxes under Section 59A of the Code),
customs duties, capital stock, franchise, profits, withholding, social security
(or similar), unemployment, disability, real property, personal property, sales,
use, transfer, registration, value added, alternative or add-on minimum,
estimated or other tax of any kind whatsoever, including any interest, penalty
or addition thereto, whether disputed or not.

     "401(k) ASSETS" has the meaning set forth in Section 4(f) below.

          2. THE TRANSACTION.

           (a) PURCHASE AND SALE OF ACQUIRED ASSETS. On and subject to the terms
     and conditions of this Agreement, the Buyer agrees to purchase from the
     Seller, and the Seller agrees to sell, transfer, convey, and deliver to the
     Buyer, all of the Acquired Assets at the Closing for the consideration
     specified below in this Section 2.

           (b) CERTAIN PERSONAL PROPERTY. The office supplies and certain other
     personal property on the premises of the Seller located generally at 5600
     South 42nd Street, Omaha, Nebraska (such premises referred to herein as the
     "Facility"), including, without limitation, paper products, spare computer
     parts and other accessories, including additional memory, printer
     cartridges and such other personal property of Seller, shall be apportioned
     among the Parties in a mutually agreeable manner.


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           (c) ASSUMPTION OF LIABILITIES. On and subject to the terms and
   conditions of this Agreement, the Buyer agrees to assume and become
   responsible for all of the Assumed Liabilities as of March 31, 2000.

           (d) PURCHASE PRICE. The Buyer agrees to pay to the Seller at the
   Closing a purchase price (the "Purchase Price") equal to Six Million and
   00/100 Dollars ($6,000,000) adjusted:

               (i) upward in an amount equal to any net increase or downward
        in an amount equal to any net decrease in the book value of the
        Inventories as reflected on the Seller's balance sheet as of March 31,
        2000 from book value of the Inventories reflected on the Seller's
        balance sheet as of December 31, 1999 (which the parties stipulate
        shall equal $2,833,354); provided that no adjustment to the Purchase
        Price shall be made pursuant to this clause (i) unless any such net
        increase or decrease in the book value of the Inventories is equal to
        One Hundred Thousand Dollars ($100,000) or more;

               (ii) upward in an amount equal to any net decrease or
        downward in an amount equal to any net increase in the aggregate
        amount of accrued employee vacation liability as reflected on the
        Seller's balance sheet as of March 31, 2000 from amount of such
        liability reflected on the Seller's balance sheet as of December
        31, 1999; provided that no adjustment to the Purchase Price shall
        be made pursuant to this clause (ii) unless any such net increase
        or decrease in such liability is equal to Ten Thousand Dollars
        ($10,000) or more;

               (iii) upward in an amount equal to all payroll, payroll taxes
        and other employee benefits costs incurred by the Seller with respect
        to the employees listed on Schedule 3(n) between April 1, 2000 and the
        Closing Date; and

               (iv) upward in an amount equal to all other expenses set forth
        in Schedule 2.4 that are paid or incurred by Seller on behalf of Buyer
        between April 1, 2000 and the Closing Date ("Paid and Incurred
        Expenses").

        Payment of the Purchase Price shall be made by delivery to Seller at
   the Closing of (i) a promissory note in the form attached as Exhibit A
   hereto in the principal amount of Two Million and 00/100 Dollars
   ($2,000,000) (the "Buyer Note"), which shall be accompanied by a personal
   guarantee of Stephen F. Dwyer in the form attached as Exhibit B hereto (the
   "Dwyer Guarantee") and (ii) cash for the balance of the Purchase Price
   payable by wire transfer or delivery to Seller's designated account of
   other immediately available funds.

            (e) ALLOCATION. The Parties agree to allocate the Purchase Price
   among the Acquired Assets for all purposes (including financial accounting
   and tax purposes) in accordance with the allocation schedule attached
   hereto as Exhibit C.

            (f) THE CLOSING. The closing of the transactions contemplated by
   this Agreement (the "Closing") shall take place at the offices Dwyer,
   Smith, Gardner, Lazer, Pohren, Rogers & Forrest, 8712 West Dodge Road,
   Suite 400, Omaha, Nebraska 68114


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     commencing at 9:00 a.m. local time on the second business day following the
     satisfaction or waiver of all conditions to the obligations of the Parties
     to consummate the transactions contemplated hereby (other than conditions
     with respect to actions the respective Parties will take at the Closing
     itself) or such other date as the Parties may mutually determine (the
     "Closing Date"); PROVIDED, HOWEVER, that the Closing Date shall be no later
     than May 31, 2000.

             (g) DELIVERIES AT THE CLOSING. At the Closing, (i) the Seller will
     deliver to the Buyer the various certificates, instruments and documents
     referred to in Section 8(a) below; (ii) the Buyer will deliver to the
     Seller the various certificates, instruments and documents referred to in
     Section 8(b) below; (iii) the Seller will execute, acknowledge (if
     appropriate) and deliver to the Buyer all documents necessary for the
     effective sale, transfer, conveyance and assignment to the Buyer of the
     Acquired Assets; (iv) the Buyer will execute, acknowledge (if appropriate)
     and deliver to the Seller all documents necessary for the effective
     assumption of the Assumed Liabilities and (v) the Buyer and Stephen Dwyer
     will deliver to the Seller the consideration specified in Section 2(d)
     above.

           (h) FINANCING AFTER SELLER'S INITIAL PUBLIC OFFERING.

               (A) Seller acknowledges that Buyer is paying the cash portion
        of the Purchase Price at the Closing as an accommodation to the Seller
        and that the Buyer has entered into a loan agreement with one or more
        lenders (the "Lenders") under which the Buyer has borrowed the funds
        necessary to pay the cash portion of the Purchase Price along with
        loan fees and to provide additional working capital to Buyer (the
        "Buyer Loans"). The Seller agrees that within three days following
        closing of the IPO, the Seller will pay to the Lenders the full amount
        of principal and accrued and unpaid interest on the Buyer Loans and
        will acquire and assume the Buyer Loans as if it were the original
        lender thereunder.

               (B) In connection with the acquisition of the Buyer Loans by
        the Seller, the Seller shall be entitled to all security interests in
        the assets of the Buyer (including, specifically, the Acquired Assets)
        and any other security interest held by the Lenders in connection with
        the Buyer Loans and to the personal guarantees of Stephen F. and Nancy
        Dwyer delivered with respect thereto, each of which shall be assigned
        and delivered to the Seller in such documents, in a form and substance
        satisfactory to Seller, as are necessary to provide Seller with the
        same collateral rights as the Lenders; provided, however, that Seller
        shall not be entitled to receive the personal guarantees delivered by
        any person other than Stephen F. and Nancy Dwyer in connection with
        the Buyer Loans.

               (C) In the event the Seller acquires the Buyer Loans under this
        Section 2(h), the maturity date of the Buyer Note shall be adjusted so
        that all principal and accrued interest on the Buyer Note is due and
        payable in full on the same date the Buyer Loan is due and payable and
        the Buyer Note shall


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          also become secured by each of the security interests described in
          paragraph B above on a pari passu basis with the Buyer Loans.

                 (D) As a condition to Seller's obligation to acquire the Buyer
          Loans, Stephen F. Dwyer shall deliver certificates for 1,200,000
          shares of Seller's common stock owned by him, along with signed and
          undated stock powers relating thereto in a form and substance
          acceptable to Seller, to an escrow agent designated by Seller and
          grant to such escrow agent the right to sell any and all of such
          shares to the extent necessary to pay principal and interest on the
          Buyer Loans and the Buyer Note as and when due, including the
          acceleration thereof in the event of default. In connection with the
          foregoing, the Seller agrees to (i) register 1,200,000 shares of the
          Seller's common stock owned by Stephen F. Dwyer for resale with the
          Securities and Exchange Commission pursuant to the Securities Act of
          1933, as amended (the "Securities Act") and (ii) list such shares with
          the Nasdaq Stock Market for quotation on the Nasdaq National Market or
          such other market or exchange on which the Seller's common stock is
          then listed. Registration under the Securities Act shall be made at
          the same time as the registration of the shares of common stock to be
          sold by Seller in connection with the IPO.

     3.   REPRESENTATIONS AND WARRANTIES OF THE SELLER. The Seller
represents and warrants to the Buyer that the statements contained in this
Section 3 are correct and complete as of the date of this Agreement and will
be correct and complete as of the Closing Date (as though made then and as
though the Closing Date were substituted for the date of this Agreement
throughout this Section 3), except as set forth in the disclosure schedules
accompanying this Agreement (the Disclosure Schedules).

          (a) ORGANIZATION OF THE SELLER. The Seller is a corporation duly
     organized, validly existing, and in good standing under the laws of the
     State of Delaware.

          (b) AUTHORIZATION OF TRANSACTION. The Seller has full power and
     authority (including full corporate power and authority) to execute and
     deliver this Agreement and to perform its obligations hereunder. This
     Agreement has been duly authorized, executed and delivered by the Seller
     and (assuming due authorization and delivery by the Buyer) is a valid and
     binding agreement of the Seller, enforceable in accordance with its terms,
     except as enforceability may be limited by bankruptcy, insolvency,
     reorganization, moratorium or similar laws relating to or affecting
     creditors' rights generally or by general equitable principles.

          (c) NONCONTRAVENTION. Neither the execution and the delivery of this
     Agreement, nor the consummation of the transactions contemplated hereby,
     will (i) violate any constitution, statute, regulation, rule, injunction,
     judgment, order, decree, ruling, charge or other restriction of any
     government, governmental agency or court to which the Seller is subject or
     any provision of the charter or bylaws of the Seller or (ii) conflict with,
     result in a breach of, constitute a default under, result in the
     acceleration of or create in any party the right to accelerate, terminate,
     modify or cancel any agreement, contract, lease, license, instrument or
     other arrangement to which the Seller is


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     a party or by which it is bound or to which any of its assets is subject
     (or result in the imposition of any Security Interest upon any of the
     Acquired Assets). Other than set forth in Schedule 4(c), the Seller is not
     required to give any notice to, make any filing with or obtain any
     authorization, consent or approval of any governmental or regulatory agency
     or any other third party in order for the Parties to consummate the
     transactions contemplated by this Agreement.

          (d) BROKERS' FEES. The Seller has no liability or obligation to pay
     any fees or commissions to any broker, finder or agent with respect to the
     transactions contemplated by this Agreement for which the Buyer could
     become liable or obligated.

          (e) TITLE TO ACQUIRED ASSETS. The Seller has good and marketable title
     to, or a valid leasehold interest in, each of the Acquired Assets free and
     clear of all Security Interests other than those that will be released at
     or prior to the Closing.

          (f) LEGAL COMPLIANCE. The Seller and its predecessors have complied
     with all applicable laws (including rules, regulations, codes, plans,
     injunctions, judgments, orders, decrees, rulings and charges thereunder) of
     federal, state, local and foreign governments (and all agencies thereof)
     relating to the manufacture and marketing of the CETAC Products, and no
     action, suit, proceeding, hearing, investigation, charge, complaint, claim,
     demand or notice has been filed or commenced against the Seller alleging
     any failure so to comply.

          (g) LEASES. The Seller has delivered to the Buyer correct and complete
     copies of the Leases listed in Schedule 1.1. Each Lease is legal, valid,
     binding, enforceable, and in full force and effect and will continue to be
     legal, valid, binding, enforceable and in full force and effect on
     identical terms following the consummation of the transaction contemplated
     hereby. The Seller is not in breach or default under any Lease and no event
     has occurred which, with notice or lapse of time, would constitute a breach
     or default of the Lease by the Seller or permit termination, modification
     or acceleration thereof by the respective lessor and no party to any Lease
     has repudiated any provision thereof. There are no disputes, oral
     agreements, or forbearance programs in effect as to any Lease. All
     facilities leased thereunder are supplied with utilities and other services
     necessary for the operation of said facilities.

          (h) INTELLECTUAL PROPERTY. The Seller has delivered to the Buyer
     correct and complete copies of each item of Intellectual Property listed in
     Schedule 1.4. The Seller owns or has the right to use pursuant to license,
     sublicense, agreement, or permission each item of the Intellectual Property
     free and clear of any restriction and has taken all necessary action to
     maintain and protect each item of Intellectual Property. No item of
     Intellectual Property is subject to any outstanding injunction, judgment,
     order, decree, ruling or charge limiting its use by the Seller or Seller's
     ability to convey such Intellectual Property to the Buyer hereunder. No
     action, suit, proceeding, hearing, investigation, charge, complaint, claim
     or demand is pending or, to the Seller's Knowledge, is threatened which
     challenges the legality, validity, enforceability, use, or ownership of any
     item of the Intellectual Property; and Seller has never received any
     charge, complaint, claim, demand or notice alleging any such interference,
     infringement,


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     misappropriation or violation (including any claim that it license or
     refrain from using any intellectual property rights of any third party). To
     the Seller's Knowledge, no third party has interfered with, infringed upon,
     misappropriated or otherwise come into conflict with any item of the
     Intellectual Property and no item of the Intellectual Property interferes
     with, infringes upon, misappropriates or otherwise comes into conflict with
     any intellectual property rights of third parties.

          (i) INVENTORIES. The items included in the Inventory are merchantable
     and fit for the purpose for which they were procured or manufactured, and
     are not obsolete, damaged or defective.

          (j) INTANGIBLE PROPERTY. The Seller has delivered to the Buyer correct
     and complete copies of each item of Intangible Property listed in Schedule
     1.5. Each item of Intangible Property is legal, valid, binding, enforceable
     and in full force and effect and will continue to be legal, valid, binding,
     enforceable and in full force and effect on identical terms following the
     consummation of the transaction contemplated hereby. The Seller is not in
     breach or default under any item of Intangible Property and no event has
     occurred which, with notice or lapse of time, would constitute a breach or
     default of an item of Intangible Property by the Seller or permit
     termination, modification or acceleration thereof by the respective
     counterparty and no party to any item of Intangible Property has repudiated
     any provision thereof. There are no disputes, oral agreements or
     forbearance programs in effect as to any item of Intangible Property.

          (k) PERMITS. The Seller has delivered to the Buyer correct and
     complete copies of each Permit listed in Schedule 1.6. Each Permit is in
     full force and effect and will continue to be in full force and effect on
     identical terms following the consummation of the transaction contemplated
     hereby. The Seller is not in breach or default under any Permit and no
     event has occurred which, with notice or lapse of time, would constitute a
     breach or default by the Seller of any Permit or result in the revocation
     thereof. There are no disputes, oral agreements or forbearance programs in
     effect as to any Permit.

          (l) DOCUMENTS. The Documents to be delivered at the Closing include
     all of the books, records (including all relevant employee records or
     copies thereof), ledgers, files, documents, correspondence, lists, plats,
     architectural plans, drawings, and specifications, creative materials,
     advertising and promotional materials, studies, reports and other printed
     or written materials relating to the CETAC Products.

          (m) PRODUCT LIABILITY AND WARRANTIES. There are no actions, suits,
     proceedings, hearings, investigations, charges, complaints, claims or
     demands pending or, to the Seller's Knowledge, threatened arising out of
     any injury to individuals or property as a result of the ownership,
     possession or use of any CETAC Product. The Seller has delivered to the
     Buyer correct and complete copies of each warranty relating to the CETAC
     products that are included in the Assumed Liabilities (the "Product
     Warranties"). There are no other express guaranties, warranties or other
     indemnities beyond the terms and conditions of the Product Warranties.


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          (n) EMPLOYEES AND CERTAIN EMPLOYEE BENEFITS. To the Seller's
     Knowledge, each of its employees listed on Schedule 3(n) hereof plans to
     become an employee of the Buyer upon consummation of the transaction
     contemplated by this Agreement. The Seller is not a party to or bound by
     any collective bargaining agreement, nor has experienced any strikes,
     grievances, claims of unfair labor practices or other collective bargaining
     disputes. Seller has committed no unfair labor practice. Seller has no
     Knowledge of any organizational effort presently being made or threatened
     by or on behalf of any labor union with respect to the employees listed in
     Schedule 3(n). The 401(k) Plan maintained by the Seller with respect to
     employees listed in Schedule 3(n) (the "Seller's Plan") complies in all
     material respects with the applicable provisions of the Code.

          (o) SALES AND COST INFORMATION. The information relating to the sales
     of CETAC products and costs of materials associated therewith set forth in
     Schedule 3(o) and all financial data and other information provided for or
     used in connection with determining any purchase price adjustment pursuant
     to Section 2(d)(i)-(iv) of this Agreement is accurate and complete.

          (p) ENVIRONMENT, HEALTH, AND SAFETY.

              (i) The Seller has complied with all Environmental, Health, and
          Safety Laws at each of the subject premises under the Leases, and no
          action, suit, proceeding, hearing, investigation, charge, complaint,
          claim, demand or notice has been filed or commenced against any of
          them alleging any failure so to comply. Without limiting the
          generality of the preceding sentence, the Seller has obtained and been
          in compliance with all of the terms and conditions of all permits,
          licenses and other authorizations which are required under, and has
          complied with all other limitations, restrictions, conditions,
          standards, prohibitions, requirements, obligations, schedules and
          timetables which are contained in, all Environmental, Health, and
          Safety Laws.

              (ii) Other than as described in Schedule 3(p), neither the Seller
          nor its predecessors have used or disposed of any substance at any
          property which is the subject premises under the Leases or exposed any
          employee or other individual at such locations to any substance or
          condition in any manner that could form the basis for any present or
          future action, suit, proceeding, hearing, investigation, charge,
          complaint, claim or demand against Buyer for damage to any site,
          location or body of water (surface or subsurface), for any illness of
          or personal injury to any employee or other individual, or for any
          reason under any Environmental, Health, and Safety Law.

          (q) DISCLOSURE. The representations and warranties contained in this
     Section 3 do not contain any untrue statement of a fact or omit to state
     any fact necessary in order to make the statements and information
     contained in this Section 3 not misleading.

          (r) INVESTMENT. The Seller (i) understands that the Buyer Note has not
     been, and will not be, registered under the Securities Act or under any
     state securities laws, and is being offered and sold in reliance upon
     federal and state exemptions for transactions


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     not involving any public offering, (ii) is acquiring the Buyer Note solely
     for its own account, and not with a view to the distribution thereof, (iii)
     is a sophisticated investor with knowledge and experience in business and
     financial matters and (iv) is able to bear the economic risk and lack of
     liquidity inherent in holding the Buyer Note.

          (s) ASSUMED LIABILITIES. The information relating to the Assumed
     Liabilities set forth in Schedule 1.7 is accurate and complete.

     4.   REPRESENTATIONS AND WARRANTIES OF THE BUYER. The Buyer represents and
warrants to the Seller that the statements contained in this Section 4 are
correct and complete as of the date of this Agreement and will be correct and
complete as of the Closing Date (as though made then and as though the Closing
Date were substituted for the date of this Agreement throughout this Section 4),
except as set forth in the Disclosure Schedule.

          (a) ORGANIZATION OF THE BUYER. The Buyer is a corporation duly
     organized, validly existing and in good standing under the laws of the
     State of Nebraska.

          (b) AUTHORIZATION OF TRANSACTION. The Buyer has full power and
     authority (including full corporate power and authority) to execute and
     deliver this Agreement and to perform its obligations hereunder. This
     Agreement has been duly authorized, executed and delivered by the Buyer and
     (assuming due authorization and delivery by the Seller) is a valid and
     binding agreement of the Buyer, enforceable in accordance with its terms,
     except as enforceability may be limited by bankruptcy, insolvency,
     reorganization, moratorium or similar laws relating to or affecting
     creditors' rights generally or by general equitable principles.

          (c) NONCONTRAVENTION. Neither the execution and the delivery of this
     Agreement, nor the consummation of the transactions contemplated hereby,
     will (i) violate any constitution, statute, regulation, rule, injunction,
     judgment, order, decree, ruling, charge or other restriction of any
     government, governmental agency or court to which the Buyer is subject or
     any provision of the charter or bylaws of the Buyer or (ii) conflict with,
     result in a breach of, constitute a default under, result in the
     acceleration of or create in any party the right to accelerate, terminate,
     modify or cancel any agreement, contract, lease, license, instrument or
     other arrangement to which the Buyer is a party or by which it is bound or
     to which any of its assets is subject. The Buyer is not required to give
     any notice to, make any filing with, or obtain any authorization, consent,
     or approval of any governmental or regulatory agency or any other third
     party in order for the Parties to consummate the transaction contemplated
     by this Agreement.

          (d) AVAILABILITY OF FUNDS. The Buyer has obtained a firm commitment
     from Lenders to lend the Buyer the funds necessary to allow the Buyer to
     consummate the transaction contemplated by this Agreement at the Closing.

          (e) INVESTIGATION BY BUYER. The Buyer has conducted, to its
     satisfaction, an independent investigation and analysis of the projected
     operation of its business upon the consummation of the transaction
     contemplated by this Agreement and has relied exclusively on the results
     thereof in making any determination as the future operations,


                                            11

<PAGE>


     financial viability and prospects of its business operations. Buyer has
     relied on the representations and warranties of the Seller contained herein
     only with respect to the matters specifically discussed therein.

          (f) EMPLOYEES AND CERTAIN EMPLOYEE BENEFITS. Buyer intends to retain
     the services of each of employees of the Seller identified on Schedule 3(n)
     for a period of at least six months after the Closing Date, it being
     understood by the Seller that the Buyer shall retain all power to discharge
     individual employees who are not performing on a satisfactory basis. Buyer
     intends to establish a 401(k) Plan for its employees (including those
     listed on Schedule 3(n) (the "Buyer's Plan") that will comply in all
     material respects with the applicable provisions of the Code. Buyer and
     Buyer's Plan will maintain all accrued benefits and optional forms of
     benefits with respect to the assets in the Seller's Plan attributable to
     the accounts of the current employees of Seller who are identified on
     Schedule 3(n) and who become employees of Buyer as of the Closing Date (the
     "401(k) Assets"), within the meaning of Section 411(d)(6) of the Code.

          (g) BROKERS' FEES. The Buyer has no liability or obligation to pay any
     fees or commissions to any broker, finder, or agent with respect to the
     transactions contemplated by this Agreement for which the Seller could
     become liable or obligated.

     5.   DISCLAIMER OF WARRANTY. THE BUYER ACKNOWLEDGES AND AGREES THAT ALL
ACQUIRED ASSETS ARE BEING ASSIGNED, TRANSFERRED AND CONVEYED TO BUYER ON AN "AS
IS, WHERE IS" BASIS, AND THAT, EXCEPT AS EXPRESSLY SET FORTH IN SECTION 3
HEREOF, SELLER IS MAKING NO REPRESENTATION OR WARRANTY OF ANY KIND, EXPRESSED OR
IMPLIED, RESPECTING THE ACQUIRED ASSETS AS TO MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE OR ANY OTHER MATTER.

     6.   PRE-CLOSING COVENANTS. The Parties agree as follows with respect to
the period between the execution of this Agreement and the Closing:

          (a) GENERAL. Each of the Parties will use its best efforts to take all
     action and to do all things necessary in order to consummate and make
     effective the transactions contemplated by this Agreement (including
     satisfaction, but not waiver, of the closing conditions set forth in
     Section 8 hereof).

          (b) NOTICES AND CONSENTS. Each of the Parties will provide such
     notices to, make such filings, and use its best efforts to obtain any
     authorizations, consents and approvals of any governmental or regulatory
     agency or third parties necessary to the consummation of the transaction
     contemplated by this Agreement.

          (c) OPERATION OF BUSINESS. The Seller will not engage in any practice,
     take any action or enter into any transaction with respect to the
     manufacture or marketing of the CETAC Products which are outside the
     Ordinary Course of Business with respect thereto.

                                            12


<PAGE>


          (d) PRESERVATION OF ACQUIRED ASSETS. The Seller will keep the Acquired
     Assets substantially intact, including its physical facilities and
     relationships with lessors, licensors, suppliers, customers and employees.

          (e) ACCOUNTS PAYABLE. On or before the Closing Date the Seller will
     remit payment to each of its suppliers or venders who have provided goods
     or services to the Seller relating directly to the manufacture of the CETAC
     Products so that all supplier or vender accounts are paid as of a date no
     later than 45 days after relevant invoice date. Buyer agrees that such
     payments may be made, in whole or in part, from the cash portion of the
     Purchase Price paid at Closing.

          (f) FULL ACCESS. The Seller will permit representatives of the Buyer
     to have full access at all reasonable times, and in a manner so as not to
     interfere with the normal business operations of the Seller to all Acquired
     Assets.

          (g) NOTICE OF DEVELOPMENTS. Each Party will give prompt written notice
     to the other Party of any material adverse development causing, or which
     could cause, a breach of any of its own representations and warranties
     contained herein. No disclosure by any Party pursuant to this Section 6(g),
     however, shall be deemed to amend or supplement any Disclosure Schedule or
     to prevent or cure any misrepresentation, breach of warranty or breach of
     covenant.

          (h) EXCLUSIVITY. The Seller will not (i) solicit, initiate or
     encourage the submission of any proposal or offer from any Person relating
     to the acquisition of any of the Acquired Assets (other than sales of
     Inventories made in the Ordinary Course of Business), including any
     acquisition structured as a merger, consolidation or share exchange or (ii)
     participate in any discussions or negotiations regarding, furnish any
     information with respect to, assist or participate in or facilitate in any
     other manner any effort or attempt by any Person to do or seek any of the
     foregoing. The Seller will notify the Buyer immediately if any Person makes
     any proposal, offer, inquiry or contact with respect to any of the
     foregoing.

     7.   POST-CLOSING COVENANTS. The Parties agree as follows with respect to
the period following the Closing.

          (a) GENERAL. In case at any time after the Closing any further action
     is necessary or desirable to carry out the purposes of this Agreement, each
     of the Parties will take such further action (including the execution and
     delivery of such further instruments and documents) as the other Party
     reasonably may request, all at the sole cost and expense of the requesting
     Party (unless the requesting Party is entitled to indemnification therefor
     under Section 9 hereof).

          (b) LITIGATION SUPPORT. In the event, and for so long as, any Party
     actively is contesting or defending against any action, suit, proceeding,
     hearing, investigation, charge, complaint, claim or demand in connection
     with (i) any transaction contemplated under this Agreement or (ii) any
     fact, situation, circumstance, status, condition, activity, practice, plan,
     occurrence, event, incident, action, failure to act or transaction on or
     prior

                                            13


<PAGE>


     to the Closing Date involving any of the Acquired Assets, the other Party
     will cooperate with the contesting or defending Party and its counsel in
     the contest or defense thereof, make available its personnel and provide
     such testimony and access to its books and records as shall be reasonably
     necessary in connection with the contest or defense thereof, all at the
     sole cost and expense of the contesting or defending Party (unless the
     contesting or defending Party is entitled to indemnification therefor under
     Section 9 hereof).

          (c) TRANSITION. The Seller will not take any action that is designed
     or intended to have the effect of discouraging any lessor, licensor,
     customer, supplier or other business associate from maintaining the same
     business relationships with the Buyer after the Closing as such party
     maintained with the Seller prior to the Closing. The Seller will refer all
     customer inquiries relating to the CETAC Products to the Buyer from and
     after the Closing. Buyer and Seller shall each use their best efforts to
     cooperate with the other, and to cause their respective employees to act
     accordingly, in order to fulfill the intent and purpose of this Agreement.

          (d) CONFIDENTIALITY. The Seller will treat and hold as such all of the
     Confidential Information, refrain from using any of the Confidential
     Information except in connection with this Agreement and deliver promptly
     to the Buyer or destroy, at the request and option of the Buyer, all
     tangible embodiments (and all copies) of the Confidential Information which
     are in its possession. In the event that the Seller is requested or
     required (by oral question or request for information or documents in any
     legal proceeding, interrogatory, subpoena, civil investigative demand or
     similar process) to disclose any Confidential Information, the Seller will
     notify the Buyer promptly of the request or requirement so that the Buyer
     may seek an appropriate protective order or waive compliance with the
     provisions of this Section 7(d). If, in the absence of a protective order
     or the receipt of a waiver hereunder, the Seller is, on the advice of
     counsel, compelled to disclose any Confidential Information to any tribunal
     or else stand liable for contempt, the Seller may disclose the Confidential
     Information to the tribunal; PROVIDED, HOWEVER, that the Seller shall use
     its best efforts to obtain, at the request of the Buyer, an order or other
     assurance that confidential treatment will be accorded to such portion of
     the Confidential Information required to be disclosed as the Buyer shall
     designate.

          (e) COVENANT NOT TO COMPETE. Seller and Collin J. D'Silva, in his
     individual capacity, respectively, agree that, for a period of five (5)
     years following the Closing Date, in any geographic area in which Seller
     conducts business as of the Closing Date, neither shall, directly or
     indirectly, alone or in association with others, in the capacity as
     partner, shareholder or any other legal or beneficial capacity, or
     otherwise, or through or in connection with any Person:

          (i)   Manufacture or sell any product that directly or indirectly
                competes with any CETAC Product being sold (or contemplated to
                be sold) by the Seller as of the Closing Date;


                                            14

<PAGE>


          (ii)   Solicit, or attempt to solicit, any supplier, vendor,
                 customer or employee of the Buyer;

          (iii)  Divert or attempt to divert, for its direct or indirect benefit
                 or for the benefit of any other person, any supplier, vendor,
                 customer, employee or other relevant party from the Buyer;

          (iv)   Influence or attempt to influence any supplier, vendors,
                 customer, employee, or other relevant party to change or
                 transfer its business, patronage, employment or other
                 relationship from the Buyer, directly or indirectly, to Seller
                 or to any other Person;

          (v)    Assist, be or become involved in or associated with, in any
                 capacity, any Person that manufactures or sells any product
                 that directly or indirectly competes with any CETAC Product
                 being sold (or contemplated to be sold) by the Seller as of
                 the Closing Date; provided, however, that in this provision
                 shall not apply to Seller's ownership of less than 1% of the
                 outstanding securities any publicly-traded corporation which
                 is engaged in any such business;

          (vii)  In any other manner interfere with, disrupt or attempt to
                 disrupt the relationship of the Buyer with any customer,
                 supplier, vendor, employee or other relevant party of the
                 Buyer, including the solicitation of any of the foregoing; or

          In the event of a breach or threatened breach under this Section 7(e),
     each of the Seller and Collin J. D'Silva hereby acknowledges and stipulates
     that Buyer shall not have an adequate remedy at law, shall suffer
     irreparable harm, and, therefore, it is mutually agreed and stipulated by
     the Seller and Collin J. D'Silva that, in addition to any other remedies at
     law or in equity which the Buyer may have, the Buyer shall be entitled to
     obtain in a court of law and/or equity a temporary and/or permanent
     injunction restraining the Buyer or Collin J. D'Silva, as the case may be,
     from any further violation or breach of the covenants set forth in this
     Section 7(e). In the event that any one or more of the provisions contained
     herein shall, for any reason, be held to be excessively broad as to
     duration, geographical scope, activity or subject, such provision shall be
     construed as limiting and reducing it as determined by a court of competent
     jurisdiction and shall be enforceable to the extent compatible with
     applicable law.

          (f) USE OF PREMISES AND SHARE SYSTEMS. The Buyer agrees to allow the
     Seller and its personnel to continue to occupy the Facility and to conduct
     its business operations thereat for a period of not less than 120 days
     after the Closing Date. Buyer will allow Seller full and unimpeded access
     to computers and other shared systems during the term of co-occupancy. The
     Buyer and Seller agree to enter into a sublease of such premises on
     commercially reasonable terms reflecting their co-occupancy thereof during
     such period and to share systems and services, including but not limited to
     utilities, and cost thereof on an equitable basis. The Seller agrees to use
     its best efforts to locate another suitable


                                            15

<PAGE>


     location for its Omaha, Nebraska operations as soon as practicable after
     the Closing Date consistent with limiting disruption to its business
     operations.

          (g) ACCOUNTS RECEIVABLE. The Buyer will use its reasonable best
     efforts (which includes providing prompt customer support) to assist the
     Seller in collecting accounts receivable from the sale of the CETAC
     Products by the Seller prior to April 1, 2000 and in the event that the
     Buyer receives payment with respect to such accounts receivable, it shall
     hold such payments in trust for the benefit of the Seller and promptly
     remit such payments to Seller. Likewise, the Seller will use its reasonable
     best efforts to assist the Buyer in collecting Accounts Receivable and in
     the event that the Seller receives payment with respect to such Accounts
     Receivable, it shall hold such payments in trust for the benefit of the
     Buyer and promptly remit such payments to Buyer.

          (h) 401(k) ASSETS. Within 30 days following the Closing Date, Seller
     and Buyer shall enter into a transfer agreement and shall cause the 401(k)
     Assets in the Seller's Plan to be transferred to the Buyer's Plan.

          (i) COMPLETION OF M6000 ELECTRONIC DOCUMENTATION. The Seller will
     undertake to complete the M6000 Electronic Documentation according to the
     specifications in Schedule 7(i).

    8. CONDITIONS TO OBLIGATION TO CLOSE.

             (a) CONDITIONS TO OBLIGATION OF THE BUYER. The obligation of the
      Buyer to consummate the transactions to be performed by it in connection
      with the Closing is subject to satisfaction of the following conditions:

                 (i) the representations and warranties of the Seller set forth
          in Section 3 hereof shall be true and correct in all material
          respects at and as of the Closing Date;

                 (ii) the Seller shall have performed and complied with all of
          its covenants hereunder in all material respects through the Closing;

                 (iii) the Seller shall have procured all of the third party
          consents specified in Schedule 3(c);

                 (iv) no action, suit or proceeding shall be pending or
          threatened before any court or quasi-judicial or administrative
          agency of any federal, state, local or foreign jurisdiction or before
          any arbitrator wherein an unfavorable injunction, judgment, order,
          decree, ruling,or charge would (A) prevent consummation of any of the
          transactions contemplated by this Agreement, (B) cause any of the
          transactions contemplated by this Agreement to be rescinded following
          consummation, (C) affect adversely the right of the Buyer to own the
          Acquired Assets or to utilize them in its business operations;


                                            16

<PAGE>

                 (v) the Seller shall have delivered to the Buyer a certificate
          to the effect that each of the conditions specified above in Section
          8(a)(i)-(iv) has been satisfied in all respects;

                 (vi) the Buyer shall have received from counsel to the Seller
          an opinion in form and substance as set forth in Exhibit D attached
          hereto, addressed to the Buyer and dated as of the Closing Date;

                 (vii) the Buyer shall have obtained on terms and conditions
          satisfactory to it all of the financing it needs in order to
          consummate the transactions contemplated hereby and fund the working
          capital requirements of its business after the Closing;

                 (viii) the Seller shall have entered into an agreement with the
          Lenders under which Seller has agreed to acquire the Buyer Loans as
          described in Section 2(h) hereof; and

                 (ix) all actions to be taken by the Seller in connection with
          consummation of the transactions contemplated hereby and all
          certificates, opinions, instruments and other documents required to
          effect the transactions contemplated hereby will be satisfactory in
          form and substance to the Buyer.

     The Buyer may waive any condition specified in this Section 8(a) if it
executes a writing so stating at or prior to the Closing.

              (b) CONDITIONS TO OBLIGATION OF THE SELLER. The obligation of the
      Seller to consummate the transactions to be performed by it in connection
      with the Closing is subject to satisfaction of the following conditions:

                 (i) the representations and warranties of the Buyer set forth
          in Section 4 above shall be true and correct in all material respects
          at and as of the Closing Date;

                 (ii) the Buyer shall have performed and complied with all of
          its covenants hereunder in all material respects through the Closing;

                 (iii) no action, suit or proceeding shall be pending or
          threatened before any court or quasi-judicial or administrative agency
          of any federal, state, local or foreign jurisdiction wherein an
          unfavorable injunction, judgment, order, decree, ruling or charge
          would (A) prevent consummation of any of the transactions contemplated
          by this Agreement or (B) cause any of the transactions contemplated by
          this Agreement to be rescinded following consummation;

                 (iv) the Buyer shall have delivered to the Seller a certificate
          to the effect that each of the conditions specified above in Section
          8(b)(i)-(iii) has been satisfied in all respects;


                                            17

<PAGE>


                 (v) the Seller shall have received from counsel to the Buyer an
          opinion in form and substance as set forth in Exhibit E attached
          hereto, addressed to the Seller and dated as of the Closing Date; and

                 (vi) all actions to be taken by the Buyer in connection with
          consummation of the transactions contemplated hereby and all
          certificates, opinions, instruments and other documents required to
          effect the transactions contemplated hereby will be satisfactory in
          form and substance to the Seller.

     The Seller may waive any condition specified in this Section 8(b) if it
executes a writing so stating at or prior to the Closing.

        9. INDEMNIFICATION.

             (a) INDEMNIFICATION BY THE SELLER.

                 (i) from and after the Closing Date, the Seller shall defend,
          indemnify and hold harmless the Buyer and its directors, officers,
          employees and agents from, and reimburse the aforesaid parties for,
          any and all Buyer's Damages (defined below) in the manner and to the
          extent set forth in this Section 9(a).

                 (ii) the term "Buyer's Damages" shall include all losses,
          costs, expenses (including reasonable attorneys' fees and expenses
          and other costs and expenses incident to any suit, action,
          investigation, claim or proceeding), fees, liabilities and damages
          sustained by the party entitled to indemnity prior to any
          reimbursement therefor:

                      (A) arising from any breach of a representation or
             warranty of the Seller contained in or made pursuant to this
             Agreement (except in each case to the extent corrected or
             disclosed in writing to the Buyer prior to the Closing);

                      (B) resulting from a default in the performance of any
             of the covenants or obligations that the Seller is required to
             perform under this Agreement (except to the extent corrected or
             performed by the Seller prior to the Closing);

                      (C) resulting from any claim made with respect to any
             Product Warranties relating to CETAC Products sold by Seller prior
             to the Closing Date;

                      (D) resulting from or arising in connection with the
             operation of the Seller's business, including the management,
             control, ownership or operation of the Acquired Assets prior to
             March 31, 2000;

                      (E) resulting from any Taxes payable with respect to
             Seller's business for the period ending on the Closing Date;


                                            18

<PAGE>


                      (F) which arise from any activities of Seller or Seller's
             employees or agents on Buyer's premises after Closing; and

                      (G) resulting from any environmental claim made against
             the Buyer, or their respective parent corporations, subsidiaries,
             officers, directors, shareholders and other affiliates by any
             person or entity (including, but not limited to, claims under
             CERCLA, RCRA, or other federal, state, local, or foreign
             environmental laws) arising from events, circumstances, or
             conditions occurring, or existing on or prior to March 31, 2000
             relating to the business of Seller at the Facility, whether
             disclosed or undisclosed

provided however, that Seller shall not be required to pay any Buyer's Damages
unless the aggregate amount of such Buyer's Damages exceeds $25,000 (but then to
the full extent of such Buyer's Damages). Notwithstanding the foregoing
provisions hereof to the contrary, it is understood and agreed that the amount
of Buyer's Damages payable by Seller to Buyer hereunder shall in no event exceed
the Purchase Price, except, however the amount of any Buyer's Damages pursuant
to Section 9(a)(ii)(D) shall not be limited in amount.

             (b) INDEMNIFICATION BY THE BUYER.

               (i) from and after the Closing Date, the Buyer shall indemnify
          and hold harmless the Seller and its directors, officers, employees
          and agents from, and reimburse the aforesaid parties for, any and all
          Seller's Damages (as defined below) in the manner and to the extent
          set forth in this Section 9(b).

               (ii) the term "Seller's Damages" shall include all losses, costs,
          expenses (including reasonable attorneys' fees and expenses and other
          costs and expenses incident to any suit, action, investigation, claim
          or proceeding), fees, liabilities and damages sustained by the party
          entitled to indemnity prior to any reimbursement therefor:

                    (A) arising from any breach of a representation or warranty
               of the Buyer contained in or made pursuant to this Agreement
               (except in each case to the extent corrected or disclosed in
               writing to the Seller prior the Closing);

                    (B) resulting from a default in the performance of any of
               the covenants or obligations that the Buyer is required to
               perform under this Agreement (except to the extent corrected or
               performed by the Buyer prior to the Closing);

                    (C) resulting from or arising in connection with any Assumed
               Liability as contemplated by this Agreement;

                    (D) resulting from or arising in connection with the
               operation of the Buyer's business, including the management,
               control, ownership or operation of the Acquired Assets after
               March 31, 2000;


                                            19

<PAGE>

                    (E) resulting from any Taxes payable with respect to Buyer's
               business;

                    (F) resulting from any claim which alleges that activities
               of the Buyer or any sublicensees of Buyer infringe or violate a
               third party's intellectual property rights.

provided however, that Buyer shall not be required to pay any Seller's Damages
unless the aggregate amount of such Seller's Damages exceeds $250,000 (but then
to the full extent of such Seller's Damages). Notwithstanding the foregoing
provisions hereof to the contrary, it is understood and agreed that the amount
of Seller's Damages payable by Buyer to Seller hereunder shall in no event
exceed $500,000.

          (c) LEGAL PROCEEDINGS.

               (i) If any legal proceeding shall be instituted, or any claim or
          demand made, against any indemnified party in respect of which an
          indemnifying party may be liable hereunder, the indemnified party
          shall give prompt written notice thereof to the indemnifying party. No
          indemnification provided for in this Section 9 shall be available to
          any party who shall fail so to give notice if the party to whom such
          notice was not given was unaware of the action, suit, investigation,
          inquiry or proceeding to which the notice would have related and was
          prejudiced by the failure to give the notice, but the omission so to
          notify such indemnifying party or parties of any such service or
          notification shall not relieve such indemnifying party or parties from
          any liability which it or they may have to the indemnified party
          otherwise than on account of such indemnity agreement. Any
          indemnifying party shall be entitled at its own expense to participate
          in the defense of any action, suit or proceeding against, or
          investigation or inquiry of, an indemnified party. Any indemnifying
          party shall be entitled, if it so elects within a reasonable time
          after receipt of the notice by giving written notice to the
          indemnified party, to assume the entire defense of such action, suit,
          investigation, inquiry or proceeding, in which event such defense
          shall be conducted, at the expense of the indemnifying party or
          parties, by counsel chosen by such indemnifying party or parties and
          reasonably satisfactory to the indemnified party or parties; PROVIDED,
          HOWEVER, that (i) if the indemnified party or parties reasonably
          determine that there may be a conflict between the positions of the
          indemnifying party or parties and of the indemnified party or parties
          in conducting the defense of such action, suit, investigation, inquiry
          or proceeding or that there may be legal defenses available to such
          indemnified party or parties different from or in addition to those
          available to the indemnifying party or parties, then counsel for the
          indemnified party or parties shall be entitled to conduct the defense
          to the extent reasonably determined by such counsel to be necessary to
          protect the interests of the indemnified party or parties and (ii) in
          any event, the indemnified party or parties shall be entitled to have
          counsel chosen by such indemnified party or parties participate in,
          but not conduct, the defense. If an indemnifying party gives a notice
          that it intends to assume the defense of any action, suit,
          investigation, inquiry or proceeding and the counsel chosen by the
          indemnifying party or parties is reasonably satisfactory to the
          indemnified party or parties, the indemnifying party or parties will


                                            20

<PAGE>

          not be liable under this Section 9 for any legal or other expenses
          subsequently incurred by the indemnified party or parties in
          connection with the defense of the action, suit, investigation,
          inquiry or proceeding, except that (A) the indemnifying party or
          parties shall bear the legal and other expenses incurred in connection
          with the conduct of the defense as referred to in clause (i) of the
          proviso to the preceding sentence (provided, however, that the
          indemnifying party shall not be liable for the fees and expenses of
          more than one separate firm for all such indemnified parties) and (B)
          the indemnifying party or parties shall bear such other expenses as it
          or they have authorized to be incurred by the indemnified party or
          parties. If the indemnifying party or parties fail to provide such
          notice within a reasonable period of time, it shall be responsible for
          any legal or other expenses incurred by the indemnified party or
          parties in connection with the defense of the action, suit,
          investigation, inquiry or proceeding

               (ii) An indemnifying party will not, without the prior written
          consent of each indemnified party, settle or compromise or consent to
          the entry of any judgment in any pending or threatened claim, action,
          suit or proceeding in respect of which indemnification may be sought
          hereunder unless such settlement, compromise or consent includes an
          unconditional release of such indemnified party from all liability
          arising out of such claim, action, suit or proceeding.

       10.      TERMINATION OF AGREEMENT.

          (a) TERMINATION. This Agreement may be terminated as follows:

               (i) the Buyer and the Seller may terminate this Agreement by
          mutual written consent at any time prior to the Closing;

               (ii) the Buyer may terminate this Agreement by giving written
          notice to the Seller at any time prior to the Closing (A) in the event
          the Seller has breached any material representation, warranty or
          covenant contained in this Agreement in any material respect, the
          Buyer has notified the Seller of the breach, and the breach has
          continued without cure for a period of 30 days after the notice of
          breach or (B) if the Closing shall not have occurred on or before May
          31, 2000, by reason of the failure of any condition precedent under
          Section 8(a) hereof (unless the failure results primarily from the
          Buyer itself breaching any representation, warranty, or covenant
          contained in this Agreement); and

               (iii) the Seller may terminate this Agreement by giving written
          notice to the Buyer at any time prior to the Closing (A) in the event
          the Buyer has breached any material representation, warranty or
          covenant contained in this Agreement in any material respect, the
          Seller has notified the Buyer of the breach and the breach has
          continued without cure for a period of 30 days after the notice of
          breach or (B) if the Closing shall not have occurred on or before May
          31, 2000, by reason of the failure of any condition precedent under
          Section 8(b) hereof (unless the failure results primarily from the
          Seller itself breaching any representation, warranty or covenant
          contained in this Agreement).


                                            21

<PAGE>

               (b) EFFECT OF TERMINATION. If any Party terminates this Agreement
          pursuant to this Section 10, all rights and obligations of the Parties
          hereunder shall terminate without any Liability of any Party to the
          other Party (except for any Liability of any Party then in breach).

       11.      MISCELLANEOUS.

               (a) SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All of the
          representations and warranties of the Buyer and the Seller contained
          in this Agreement shall remain in full force and effect regardless of
          any investigation made by or on behalf of the other Party and shall
          survive for a period of 36 months after the Closing Date.

               (b) PRESS RELEASES AND PUBLIC ANNOUNCEMENTS. No Party shall issue
          any press release or make any public announcement relating to the
          subject matter of this Agreement prior to the Closing without the
          prior written approval of the other Party; PROVIDED, HOWEVER, that any
          Party may make any public disclosure it believes in good faith is
          required by applicable law in which case the disclosing Party will use
          its reasonable best efforts to advise the other Party prior to making
          the disclosure.

               (c) NO THIRD-PARRY BENEFICIARIES. This Agreement shall not confer
          any rights or remedies upon any Person other than the Parties and
          their respective successors and permitted assigns.

               (d) ENTIRE AGREEMENT. This Agreement (including the documents
          referred to herein) constitutes the entire agreement between the
          Parties and supersedes any prior understandings, agreements or
          representations by or between the Parties, whether written or oral, to
          the extent they have related in any way to the subject matter hereof.

               (e) SUCCESSION AND ASSIGNMENT. This Agreement shall be binding
          upon and inure to the benefit of the Parties named herein and their
          respective successors and permitted assigns. No Party may assign
          either this Agreement or any of its rights, interests or obligations
          hereunder without the prior written approval of the other Party.

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

               (g) HEADINGS. The section headings contained in this Agreement
          are inserted for convenience only and shall not affect in any way the
          meaning or interpretation of this Agreement.

               (h) NOTICES. All notices, requests, demands, claims and other
          communications hereunder will be in writing. Any notice, request,
          demand, claim or other communication hereunder shall be deemed duly
          given if (and then two business days after) it is sent by registered
          or certified mail, return receipt requested, postage prepaid, and
          addressed to the intended recipient as set forth below:



                                            22

<PAGE>

         If to the Seller:                           Transgenomic, Inc.
                                                     5600 South 42nd Street
                                                     Omaha, Nebraska  68107
                                                     Attention:  Mr. Collin
                                                     J. D'Silva

         Copy to:                                    Steven P. Amen
                                                     Kutak Rock LLP
                                                     1650 Farnam Street
                                                     Omaha, Nebraska  68102

         If to the Buyer:                            SD ACQUISITION, INC.
                                                     5600 South 42nd Street
                                                     Omaha, Nebraska  68107
                                                     Attention:  Mr. Stephen
                                                     F. Dwyer

         Copy to:                                    Michael L. Lazer
                                                     Dwyer, Smith, Gardner,
                                                     Lazer, Pohren, Rogers
                                                     & Forrest
                                                     8712 West Dodge Road,
                                                     Suite 400
                                                     Omaha, Nebraska 68114

     Any Party may send any notice, request, demand, claim or other
     communication hereunder to the intended recipient at the address set forth
     above using any other means (including personal delivery, expedited
     courier, messenger service, telecopy, telex, ordinary mail or electronic
     mail), but no such notice, request, demand, claim or other communication
     shall be deemed to have been duly given unless and until it actually is
     received by the intended recipient. Any Party may change the address to
     which notices, requests, demands, claims and other communications hereunder
     are to be delivered by giving the other Party notice in the manner herein
     set forth.

          (i) GOVERNING LAW. This Agreement shall be governed by and construed
     in accordance with the domestic laws of the State of Nebraska.

          (j) AMENDMENTS AND WAIVERS. No amendment of any provision of this
     Agreement shall be valid unless the same shall be in writing and signed by
     the Buyer and the Seller. No waiver by any Party of any default,
     misrepresentation or breach of warranty or covenant hereunder, whether
     intentional or not, shall be deemed to extend to any prior or subsequent
     default, misrepresentation, or breach of warranty or covenant hereunder or
     affect in any way any rights arising by virtue of any prior or subsequent
     such occurrence.

          (k) SEVERABILITY. Any term or provision of this Agreement that is
     invalid or unenforceable in any situation in any jurisdiction shall not
     affect the validity or enforceability of the remaining terms and provisions
     hereof or the validity or enforceability of the offending term or provision
     in any other situation or in any other jurisdiction.

                                            23

<PAGE>

          (l) EXPENSES. Buyer and Seller will bear its own costs and expenses
     (including legal fees and expenses) incurred in connection with this
     Agreement and the transactions contemplated hereby.

          (m) CONSTRUCTION. The Parties have participated jointly in the
     negotiation and drafting of this Agreement. In the event an ambiguity or
     question of intent or interpretation arises, this Agreement shall be
     construed as if drafted jointly by the Parties and no presumption or burden
     of proof shall arise favoring or disfavoring any Party by virtue of the
     authorship of any of the provisions of this Agreement. Any reference to any
     federal, state, local or foreign statute or law shall be deemed also to
     refer to all rules and regulations promulgated thereunder, unless the
     context requires otherwise. The word "including" shall mean including
     without limitation. Nothing in the Disclosure Schedules shall be deemed
     adequate to disclose an exception to a representation or warranty made
     herein unless the Disclosure Schedule identifies the exception with
     reasonable particularity and describes the relevant facts in reasonable
     detail. Without limiting the generality of the foregoing, the mere listing
     (or inclusion of a copy) of a document or other item shall not be deemed
     adequate to disclose an exception to a representation or warranty made
     herein (unless the representation or warranty has to do with the existence
     of the document or other item itself). The Parties intend that each
     representation, warranty, and covenant contained herein shall have
     independent significance. If any Party has breached any representation,
     warranty, or covenant contained herein in any respect, the fact that there
     exists another representation, warranty, or covenant relating to the same
     subject matter (regardless of the relative levels of specificity) which the
     Party has not breached shall not detract from or mitigate the fact that the
     Party is in breach of the first representation, warranty, or covenant.

          (n) INCORPORATION OF EXHIBITS AND SCHEDULES. The Exhibits and
     Schedules identified in this Agreement are incorporated herein by reference
     and made a part hereof.

          (o) SPECIFIC PERFORMANCE. Each of the Parties acknowledges and agrees
     that the other Party would be damaged irreparably in the event any of the
     provisions of this Agreement are not performed in accordance with their
     specific terms or otherwise are breached. Accordingly, each of the Parties
     agrees that the other Party shall be entitled to an injunction or
     injunctions to prevent breaches of the provisions of this Agreement and to
     enforce specifically this Agreement and the terms and provisions hereof in
     any action instituted in any court of the United States or any state
     thereof having jurisdiction over the Parties and the matter, in addition to
     any other remedy to which it may be entitled, at law or in equity.

          (p) TAX MATTERS.

               (i) The Seller will be responsible for the preparation and filing
          of all Tax Returns of the Seller for all periods as to which Tax
          Returns are due before and after the Closing Date. The Seller will
          make all payments required with respect to any such Tax Return.


                                            24

<PAGE>

               (ii) The Buyer will be responsible for the preparation and filing
          of all Tax Returns of the Buyer for all periods as to which Tax
          Returns are due before and after the Closing Date. The Buyer will make
          all payments required with respect to any such Tax Return.

                                            25

<PAGE>



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

                                         SD ACQUISITION INC.


                                         By:  /S/ Stephen F. Dwyer
                                              --------------------
                                              Stephen F. Dwyer, President and
                                              Chief Executive Officer


                                         TRANSGENOMIC, INC.


                                         By:  /S/ Collin J. D'Silva
                                              ---------------------
                                              Collin J. D'Silva, Chief
                                              Executive Officer


                                         /S/ Collin J. D'Silva
                                             -----------------
                                         Collin J. D'Silva, in his individual
                                         capacity solely for purposes of the
                                         covenant contained in Section 7(e)
                                         hereof



                                            26

Source: OneCLE Business Contracts.