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Subcontract Agreement - Celerity Systems Inc. and Unisys Corp.

                      SUBCONTRACT AGREEMENT DATED 6/26/97

                            Non-Disclosure Agreement

This Agreement is made between CELERITY SYSTEMS, INC., ("CELERITY") and UNISYS
Corporation - Federal Systems Division. ("UNISYS") and concerns the handling,
safeguarding and exchange of sensitive, proprietary or confidential information
(collectively "Proprietary Information"). It is agreed and understood that any
exchange of such Proprietary Information is expressly for the sole purpose of
CELERITY and UNISYS evaluating a possible business arrangement involving an
existing UNISYS contract with a federal government agency.

1.   For the purposes hereof, Proprietary Information shall be any documents,
     materials or information that (i) is in tangible form and clearly marked as
     being proprietary, confidential or sensitive and (ii) is received by one
     party to this Agreement ("Recipient") from the other party to this
     Agreement ("Transmitter").

2.   The Recipient agrees to safeguard, protect and handle all Proprietary
     Information made available under this Agreement with the same degree of
     care and procedures as Recipient applies to its own confidential or
     proprietary information. Without the written consent of the Transmitter,
     the Recipient of Proprietary Information agrees (i) not to disclose,
     disseminate, reproduce or otherwise distribute such information and
     materials to any third party, except a governmental judicial authority's
     issued order and (ii) not to use such information for any other purposes
     beyond that expressly set forth in this Agreement.

3.   All Proprietary Information disclosed under this Agreement shall remain the
     property of the Transmitter. It is agreed that the Recipient does not
     obtain any title or license rights to the Proprietary Information furnished
     under this Agreement.

4.   All Proprietary Information exchanged under this Agreement shall be
     returned or destroyed in accordance with written instructions upon the
     earlier of a written request from the Transmitter or termination of this
     Agreement. Either party may terminate this Agreement, at any time, by
     providing written notice to the receiving party. Termination of this
     Agreement shall not be construed as relieving the Recipient of its
     obligations to safeguard, protect and dispose of the Proprietary
     Information as set forth in this Agreement.

5.   The Recipient's obligations to protect, safeguard and handle Proprietary
     Information received hereunder shall not be binding if such Proprietary
     Information (i) is in the public domain through no fault of the Recipient,
     (ii) is known to the Recipient prior to disclosure hereunder, (iii) is
     lawfully disclosed to Recipient by a third party. The Recipient's
     obligations shall survive until the Proprietary Information has been
     returned, destroyed in accordance with written instructions or covered by a
     subsequent agreement between CELERITY and UNISYS for the contemplated

This represents the entire agreement of the parties relative to the subject
matter and shall be governed and construed under the laws of the Commonwealth of

Accepted by:

UNISYS Corporation                        CELERITY SYSTEMS, INC.

By: /s/ Dennis A. Chaloux                 By: /s/ William R. Chambers
  ----------------------------------         ----------------------------
Name: Dennis A. Chaloux                   Name: William R. Chambers
Title: Sr. Subcontract Administrator      Title: Vice President
Date: 6/30/97                             Date: 6/26/97

                               SUBCONTRACT BETWEEN

                               UNISYS CORPORATION
                               8008 Westpark Drive
                             McLean, Virginia 22102
                             CELERITY SYSTEMS, INC.
                      9051 Executive Park Drive, Suite 400
                           Knoxville, Tennessee 37923

SUBCONTRACT NUMBER:                                      97-IW0324-CELERITY

PRIME CONTRACT NUMBER:                                   263-96-D-0324

PERIOD OF PERFORMANCE:                                   (Reference Section 2.0)

SUBCONTRACT TYPE:                                        Firm-Fixed-Price (FFP)
                                                         Time & Material (T&M)
                                                         Purchase Orders

SUBCONTRACT AMOUNT:                                      (Reference Section 1.0)

PAYMENT TERMS:                                           Payment shall be made

                                                         upon receipt of proper

                                                         invoice, Net (30) days
                                                         (Reference Section 13.)

PRIORITY RATING:                                         N/A

SECURITY CLASSIFICATION:                                 None

UNISYS SUBCONTRACT ADMINISTRATOR:                        Dennis A. Chaloux

                                TABLE OF CONTENTS

ARTICLE                                                                     PAGE

1.0      Supplies/Services and Prices..........................................3
2.0      Period of Performance.................................................5
3.0      Packaging Labeling and Shipping.......................................5

                           4.0 Inspection and Acceptance
                           5.0 Assignment
                           6.0 Changes
                           7.0 Disputes Involving the Government

8.0      Binding Arbitration...................................................6

                           9.0      Delays
                           10.      Default
                           11.      Notices
                           12.      Invoices/Payments

13.      Patent Indemnity......................................................7

                           14.      Risk of Loss
                           15.      Termination

16.      Title.................................................................8

                           17.      Warranty
                           18.      Limitation of Liability
                           19.      Compliance With Laws

20.      Relationship of the Parties..........................................12

                           21.      Indemnification
                           22.      Limitation of Obligation
                           23.      Release of News Information
                           24.      Non-Waiver Rights

25.      Representations and Certifications...................................13

                           26.      Ethical Conduct
                           27.      Severability
                           28.      Applicable State Law
                           29.      Attachments/Exhibits
                           30.      Statement of Work

31.      Complete Agreement...................................................14



         This Agreement is entered into by and between Unisys Corporation,
Federal Systems Division, a Delaware corporation, with its principal offices
located at 8008 Westpark Drive, McLean, Virginia 22102 (hereinafter referred to
as the "BUYER"), and Celerity Systems, Inc. (hereinafter referred to as the
"SELLER") with offices located at 9051 Executive Park Drive, Suite 400,
Knoxville, Tennessee 37923.

                                 WlTNESSETH THAT

         In consideration of mutual promises, covenants, and agreements herein
set forth, the Parties agree that the SELLER shall furnish and deliver to the
BUYER all of the supplies, and perform all of the services set forth herein, for
the consideration stated therein. The rights and obligations of the Parties to
this Agreement shall be subject to and governed by the terms of this Agreement
and other documents or specifications attached hereto or Referenced herein.

         This Agreement shall not be varied in its terms or conditions by any
oral Agreement or representation, or otherwise than by an instrument in writing,
unless executed by both SELLER and BUYER.

         The section titles used herein are for convenience only and shall in no
way be construed as part of this Subcontract or as an indication of the meaning
of the particular section.


         SELLER shall provide the necessary personnel and facilities to furnish
the supplies/services as determined by or specified in individual Purchase
Orders issued to the SELLER by the BUYER. All purchase orders shall be issued
pursuant to and in accordance with this Agreement. Prices set forth in this
Agreement include taxes, duties, similar charges and include shipping charges.
All charges for deliveries to the Washington, D.C. Metropolitan Area are
included in the item prices. Transportation charges for deliveries outside the
Washington, D.C., Metropolitan Area will be negotiated on an individual Purchase
Order basis.

Unless otherwise provided in writing by the Subcontract Administrator, the costs
of the following items or activities shall be unallowable as a direct cost:

         1. Special rearrangement or alteration of facilities

         2. Purchase or lease of any item of general purpose office furniture,
         office equipment or FIP equipment regardless of dollar value. (General
         purpose equipment is defined as any items of personal property which
         are usable for purposes other than research, such as office equipment
         and furnishings, pocket calculators, etc.);

         3. Travel to attend meetings unless specified in the purchase order
         issued by the Unisys Subcontract Administrator

         4. Capitalized nonexpendable equipment (defined as having an
         acquisition cost of $1,000 or more and a life expectancy of more than
         two years).


         5. Travel Costs unless specified in the specific Purchase Order. When
authorized, expenditures for domestic travel (transportation, lodging,
subsistence, and incidental expenses) incurred in direct performance of the
resultant subcontract shall be subject to the provisions of Section 24 of Public
Law 99-234 which amends the Office of Federal Procurement Policy Act to provide
that Subcontractor costs for travel, including lodging, other subsistence, and
incidental expenses, shall be allowable only to the extent that they do not
exceed the amount allowed for federal employees. The Subcontractor, therefore,
shall invoice and be reimbursed for all Travel costs in accordance with
guidelines published in the Federal Register, Vol. 58, No. 42, Friday March 5,

         6. Postage shall be unallowable unless specifically stated in the
Purchase Order.

         7. If appropriate, any and all Other Direct Costs (ODC's) shall be
specified in the individual Purchase Orders.


         (a) Outside the Washington, D.C. Metropolitan Area:

         Travel by air will be reimbursed at actual not to exceed coach fare.
         Travel subsistence reimbursement will be authorized under the rates and
         conditions of the Federal Travel Regulations and if applicable, an
         Agency's Department Travel Manual. Per Diem will be reimbursed at
         actual, not to exceed the Per Diem rates set forth in Federal Property
         Management Regulations (FPMR) 41 CFR Chapter 101, Chapter 7, GSA
         Bulletin FPMR A-40 Supplement (in effect at time of travel). Travel of
         more than 10 hours, but less than 24 hours, when no lodging is
         required, Per Diem shall be one-half of the Meals and Incidental
         Expenses (M&IE) rate prescribed for the location where the majority of
         the time is spent performing official business. The Per Diem allowance
         shall not be allowed when the period of official travel is 10 hours or
         less during the same calendar day. Travel by privately owned vehicle
         will be reimbursed at the current GSA approved mileage rate. If the
         Subcontractor incurs travel costs in excess of the amount show in each
         Purchase Order, it is at its own expense.

         (b) Inside the Washington, D.C. Metropolitan Area:

               (1)  Travel will be reimbursed based on the policies stated in
                    paragraph (a) above.

               (2)  Normal commuting expenses are not allowed.

         (c) Travel will be reimbursed on a cost basis only. Any burden added
         to the travel costs will be allowed only as defined in the
         Subcontractor's standard accounting practice or disclosure statement.

The prices for the supplies/services to be provided by the SELLER are as

CLIN              SUPPLIES/SERVICES       QTY.        UNIT PRICE       NET PRICE
----              -----------------       ----        ----------       ---------

**To be determined on an individual Purchase Order Proposal Basis.**



         The term of this Agreement shall be from the date of execution through
14 August 1997. The Agreement term may be extended four (4) additional
twelve-month periods upon the BUYER's prior written notice of each such
twelve-month extension period; provided, however, that this Agreement is not
otherwise terminated pursuant to the Termination clause herein.


         BUYER shall provide SELLER with packaging, labeling and shipping
instructions with each purchase order issued pursuant to this Agreement. SELLER
agrees to ship products ordered by BUYER in accordance with such instructions.


         SELLER shall only tender for acceptance those items that conform to the
requirements of this Agreement. Unisys reserves the right to inspect or test any
supplies or services that have been tendered for acceptance. Unisys may require
repair or replacement of nonconforming supplies or reperformance of
nonperforming services at no additional cost. Unisys agrees to exercise its post
acceptance rights (1) within a reasonable time after the defect was discovered
or should have been discovered; and (2) before any substantial change occurs in
the condition of the item, unless the change is due to the defect in the item.

The Unisys approving and accepting authority for inspection and acceptance of
CLIN's will be the Program Manager or his designated representative. The Program
Manager's designated representative will be identified on each individual P.O.
issued pursuant to any resulting subcontract agreement.

Unless advised otherwise in individual Purchase Orders, inspection and
acceptance of all CLIN's hereunder shall take place at the Government
installation site. The installation site location shall be set forth in
individual Purchase Orders.


         SELLER may assign it's rights to be paid amounts due as a result of
performance under this contract, to a bank, trust company or other financing
institution, including any Federal lending agency in accordance with the
Assignment of Claims Act (31 U.S.C. 3727)


         Changes in the terms and condition of this Agreement may be made only
by written agreement of the parties hereto.


         This Agreement is subject to the Contract Disputes Act of 1978, as
amended (41 U.S.C. 601-613). Failure of the parties to reach agreement on any
request for equitable adjustment, claim, appeal or action arising under or
relating to this Agreement shall be a dispute to be resolved in accordance with
the clause at FAR 52.233-1 Disputes, which is incorporated herein by reference.
SELLER shall proceed diligently with performance of this Agreement, pending
final resolution of any dispute arising under this Agreement.


Any decision on appeal, or any other decision of the Government under the Prime
Contract which cannot be appealed under the "Disputes" clause of the Prime
Contract, if binding on the BUYER shall also bind the SELLER to the extent that
it relates to this Agreement, provided the BUYER shall have promptly notified
the SELLER of such decision and, if requested by SELLER, shall have brought suit
or filed claim, as appropriate against the Government. A final judgment in any
such suit or final disposition of such claim shall be conclusive upon the BUYER
and the SELLER.

For any action brought by the BUYER on behalf of the SELLER pursuant to this
clause, the SELLER agrees to indemnify and hold the BUYER harmless from all
costs and expenses incurred by the BUYER in prosecuting any such appeal
initiated by the BUYER at the Seller's request. All costs and expenses incurred
by the BUYER shall be paid by the SELLER and shall not be reimbursed or
compensable as a cost under the Agreement, unless recovered by the BUYER under
the Prime Contract or as part of an award of damages to the BUYER based on such
a claim.


         Any dispute or controversy between the BUYER and SELLER which concerns
only the BUYER and the SELLER or which does not involve a final decision of the
Government Contracting Officer, and which cannot be resolved by mutual agreement
of the parties hereto, shall be settled by arbitration in accordance with the
commercial rules then in effect of the American Arbitration Association. The
place of such arbitration shall be Washington, D.C. Each party shall select one
arbitrator and the two arbitrators so selected shall select the third
arbitrator. The arbitrators shall be knowledgeable in Government procurement
matters related to the types of supplies and services provided pursuant to this
Agreement. The arbitration decision and award shall be binding on the parties,
and judgment thereon may be entered in any court of competent jurisdiction.


         SELLER shall be liable for default unless nonperformance is caused by
an occurrence beyond the reasonable control of the SELLER and without its fault
or negligence. SELLER shall notify the BUYER in writing as soon as it is
reasonably possible after the commencement of any excusable delay, setting forth
the full particulars in connection therewith, shall remedy such occurrence with
all reasonable dispatch, and shall promptly give written notice to the BUYER of
the cessation of such occurrence.


         If either party hereto fails to perform an obligation under this
Agreement, the other party, may issue a default termination letter to the party
in default of an obligation under this Agreement to cure the default condition.
If the default condition is not remedied within ten (10) calendar days from the
day of receipt of such letter, the issuer of the default termination letter may
the without the necessity of any further notice, discontinue performance and
terminate this Agreement for default and pursue any other remedies available at
law or in equity. Any failure to exercise rights under this Article shall not
constitute a waiver of any past, present or future right or remedy.


         All correspondence or notifications required under this Agreement shall
be addressed as follows:

UNISYS Corporation                            Celerity Systems, Inc.


Attention: Dennis A. Chaloux                  
8008 Westpark Drive, Mail Stop W5A12          
McLean, Virginia  22102                       
Phone: (703) 556-5578 Fax: (703) 556-5283     

Attention: Bill Chambers                  
9051 Executive Park Drive, Suite 400      
Knoxville, Tennessee 37923                
Phone: (423) 539-5300 Fax: (423) 539-5390 


         SELLER shall submit an original invoice and two (2) copies to:

                               UNISYS Corporation
                               Attention: Frederick W. Garner III
                               8008 Westpark Drive, Mail Stop W5F39
                               McLean, Virginia 22102

SELLER's invoice must include:

         (l) Name and address of the SELLER,

         (2) Invoice Date

         (3) Prime Contract Number, contract line item number and purchase
         order number

         (4) Description, quantity, unit of measure, unit price and extended
         price of the items delivered.

         (5) Shipping number and date of shipment including the bill of lading
         number and weight of shipment. Shipping charges shall be itemized

         (6) Terms of any prompt payment discount if offered.

         (7) Name and address of official to whom payment is to be sent; and

         (8) Name, title and phone number of person to be notified in event of
         defective invoice.

         SELLER shall submit invoices for payment for the Products and Services
accepted under this Agreement. Invoices for Products and Services may be
submitted after the date of delivery of such Products and/or Services to the
F.O.B. destination site. Upon receipt of a proper invoice, BUYER agrees to pay
SELLER for accepted Products and Services net forty-five (45) days.


         SELLER agrees to indemnify BUYER, the United States Government and
their respective officers, employees and agents against liability, including
costs, for actual or alleged direct or contributory infringement of, or
inducement to infringe, any United States or foreign patent, trademark or
copyright, arising out of performance under this Agreement.


         Unless the Agreement specifically provides otherwise, risk of loss of
damage to the supplies 


provided hereunder shall remain with the SELLER until, and shall pass to the
BUYER upon; (1) delivery of the supplies to a carrier, if transportation is
f.o.b. origin; or (2) delivery of the supplies to the BUYER at the destination
specified i

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