Medchem (P.R.), Inc. - Page 13




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                                      Phase II                                        
                    (6) As to the manufacturing of nonwoven web, bulk                 
               flour was transferred from the quarantined cage to the                 
               web forming room, where it was machine processed into                  
               rolls of nonwoven web.                                                 
                    (7) The rolls of nonwoven web were transferred to                 
               the web cutting room where they were machine cut into                  
               the required size, visually inspected against product                  
               specifications, and placed in trays for drying and                     
               sterilization.  Once sterilized, the nonwoven web was                  
               transferred to the pouch load and seal room where it                   
               was packaged in a sealed pouch.  The packaged nonwoven                 
               web was sterilized, tested, and transferred to the                     
               loading and shipping area.                                             
                    (8) As to the manufacturing of finished flour,                    
               jars were machine washed, loaded into trays and carts,                 
               and dried in a walk-in oven.                                           
                    (9) The jars were moved to the filling process                    
               room where they were filled with bulk flour and placed                 
               back into an oven for further drying.                                  
                    (10) The dried jars (with bulk flour inside) were                 
               transferred by carts to the capping room where they                    
               were capped.                                                           
                    (11) The capped jars (with bulk flour inside) were                
               transferred by conveyor to the canning and sealing room                
               where they were canned, banded, and sealed with tamper-                
               proof material.                                                        
                    (12) The resulting jars (with bulk flour inside)                  
               were moved to the sterilization room where they were                   
               oven sterilized and transferred to the loading and                     
               shipping area.                                                         
               Petitioners entered into the processing agreement to ensure            
          a reliable supply of Avitene while they proceeded to establish              
          MedChem P.R.’s own Avitene manufacturing facility in Puerto Rico.           
          When the December 18, 1987, agreements were entered into,                   
          petitioners intended to have that facility ready to take over the           





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