Cash Collateral Agreement

Cash Collateral Agreement

by Quidel Corporation
July 26th, 1999


                            CASH COLLATERAL AGREEMENT

                  THIS CASH COLLATERAL AGREEMENT (this "Agreement"), dated as
of July 12, 1999, is made by Metra Biosystems, Inc., a California
corporation, as Grantor, in favor of Bank of America National Trust and
Savings Association (the "Bank"), with reference to the following facts:

                                    RECITALS

         A.  Pursuant to the Business Loan Agreement of even date herewith by
         and between Quidel Corporation (the "Borrower") and the Bank (the
         "Loan Agreement"), the Bank has agreed to provide the Borrower with
         certain revolving and term credit facilities.

         B.  The Loan Agreement provides, as a condition of the availability of
         such credit facilities, that Grantor shall enter into this Agreement
         and shall grant security interests to the Bank as herein provided.

         C.  Grantor expects to realize direct and indirect benefits as a result
         of the availability of the aforementioned credit facilities.

                                    AGREEMENT

                  NOW, THEREFORE, in order to induce the Bank to extend the
aforementioned credit facilities to the Borrower, and for other good and
valuable consideration, the receipt and adequacy of which hereby are
acknowledged, Grantor hereby represents, warrants, covenants, agrees, assigns
and grants as follows:

                  1.  DEFINITIONS.  This Agreement is the Cash Collateral
Agreement referred to in the Loan Agreement. Terms defined in the Loan
Agreement and not otherwise defined in this Agreement shall have the meanings
defined for those terms in the Loan Agreement. Terms defined in the
California Uniform Commercial Code and not otherwise defined in this
Agreement or in the Loan Agreement shall have the meanings defined for those
terms in the California Uniform Commercial Code. As used in this Agreement,
the following terms shall have the meanings respectively set forth after each:

                  "AGREEMENT" means this Cash Collateral Agreement, and any
extensions, modifications, renewals, restatements, supplements or amendments
hereof.

                  "COLLATERAL" means and includes all present and future
right, title and interest of Grantor, whether now existing or hereafter
arising, in and to the following:

                           (a)  Bank of America National Trust and Savings
         Association Account No. 14506-08709 (the "Pledged Account") and any
         substitute or additional account(s) in which funds from the Pledged
         Account, or any other funds or assets now or hereafter pledged to the
         Bank hereunder, may be held from time to time (collectively, together
         with the Pledged Account, the "Pledged Accounts"), and all funds and
         assets now or hereafter deposited by Grantor or otherwise held by the
         Bank in any Pledged Account; and

                                      -1-


                           (b)  All cash and noncash proceeds and products of
         any of the foregoing, including without limitation all interest and
         dividends earned on the Pledged Accounts, all monies and other tangible
         or intangible property received upon a sale or other disposition of any
         of the Pledged Accounts, and all rights to payment in connection with
         any cause of action with respect to any Pledged Accounts, all of which
         proceeds and products shall, if received by Grantor from time to time,
         be immediately delivered by Grantor to the Bank to be held and/or
         applied by the Bank in accordance with this Agreement.

                  "SECURED OBLIGATIONS" means any and all present and future
obligations of any type or nature of the Borrower to the Bank arising under
or relating to the Facility No. 2 term loan made pursuant to the Loan
Agreement, whether due or to become due, matured or unmatured, liquidated or
unliquidated, or contingent or noncontingent, INCLUDING obligations of
performance as well as obligations of payment, and INCLUDING interest that
accrues thereon after the commencement of any bankruptcy or insolvency
proceeding by or against the Borrower.

                  2.  FURTHER ASSURANCES.  At any time and from time to time
at the request of the Bank, Grantor shall execute and deliver to the Bank all
such financing statements and other instruments and documents in form and
substance satisfactory to the Bank as shall reasonably be necessary or
desirable to fully perfect, when filed and/or recorded, the Bank's security
interests granted pursuant to SECTION 3 of this Agreement.

               3.  PLEDGE AGREEMENT.  For valuable consideration, Grantor
hereby assigns and pledges to the Bank, and grants to the Bank a security
interest in, all presently existing and hereafter acquired Collateral, as
security for the timely payment and performance of the Secured Obligations,
and each of them. This Agreement is a continuing and irrevocable agreement
and all the rights, powers, privileges and remedies hereunder shall apply to
any and all Secured Obligations, including those arising under successive
transactions which shall either continue the Secured Obligations, increase or
decrease them, or from time to time create new Secured Obligations after all
or any prior Secured Obligations have been satisfied, and notwithstanding the
bankruptcy of Grantor or any other person or any other event or proceeding
affecting any person.

               4.  GRANTOR'S REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
EXCEPT as otherwise disclosed to the Bank in writing concurrently herewith,
Grantor represents, warrants and agrees that: (a) Grantor will pay, prior to
delinquency, all taxes, charges, liens and assessments against the
Collateral, EXCEPT Permitted Encumbrances and such other liens as are timely
contested in good faith, and upon its failure to pay or so contest such
taxes, charges, liens and assessments, the Bank at its option may pay any of
them, and the Bank shall be the sole judge of the legality or validity
thereof and the amount necessary to discharge the same; (b) the Collateral
will not be used for any unlawful purpose or in violation of any law,
regulation or ordinance, nor used in any way that will void or impair any
insurance required to be carried in connection therewith; (c) Grantor will
take all reasonable steps to preserve and protect the Collateral; and (d) in
the event Grantor changes its name or its address as either are set forth
herein or in the Loan Agreement, Grantor will notify the Bank of such name
and/or address change promptly, but in any event, within five (5) banking
days. If any Collateral, or any interest therein, is disposed of in violation
of these provisions, the security interest shall continue in such Collateral
or interest notwithstanding such disposition. The Bank shall execute and
deliver any releases or other documents reasonably requested by Grantor to
accomplish or confirm the release of Collateral provided by this Section.

                                      -2-


               5.  THE BANK'S RIGHTS RE COLLATERAL.  At any time (whether or
not an Event of Default has occurred), without notice or demand and at the
expense of Grantor, the Bank may, to the extent it may be necessary or
desirable to protect the security hereunder, but the Bank shall not be
obligated to, perform any obligation of Grantor under this Agreement or any
obligation of the Borrower under the Loan Agreement if Grantor or Borrower
has breached such obligation and all cure periods, if any, have expired.

               6.  RESTRICTIONS ON PLEDGED ACCOUNTS.  Except as expressly
provided for in the Loan Agreement, while any Secured Obligation remains
outstanding, Grantor shall have no right to withdraw any amounts from the
Pledged Account.

               7.  EVENTS OF DEFAULT.  There shall be an Event of Default
hereunder upon the occurrence and during the continuance of an Event of
Default under the Loan Agreement.

               8.  RIGHTS UPON EVENT OF DEFAULT.  Upon the occurrence and
during the continuance of an Event of Default, subject to compliance with the
requirements of applicable laws, the Bank shall have, in any jurisdiction
where enforcement hereof is sought, in addition to all other rights and
remedies that the Bank may have under applicable law or in equity or under
this Agreement (INCLUDING, without limitation, all rights set forth in
SECTION 5 hereof) or under the Loan Agreement, all rights and remedies of the
Bank under the Uniform Commercial Code as enacted in any jurisdiction, and,
in addition, the following rights and remedies, all of which may be exercised
with or without notice to Grantor and without affecting the obligations of
Grantor hereunder or under the Loan Agreement, or the enforceability of the
liens and security interests created hereby: (a) to foreclose the liens and
security interests created hereunder or under any other agreement relating to
any Collateral by any available judicial procedure or without judicial
process; (b) to sell, assign, lease or otherwise dispose of any Collateral or
any part thereof, either at public or private sale or at any broker's board,
in lot or in bulk, for cash, on credit or otherwise, with or without
representations or warranties and upon such terms as shall be acceptable to
the Bank; (c) to collect by legal proceedings or otherwise all dividends,
distributions, interest, principal or other sums now or hereafter payable
upon or on account of the Collateral; (d) to enter into any extension,
reorganization, deposit, merger or consolidation agreement, or any other
agreement relating to or affecting the Collateral, and in connection
therewith the Bank may deposit or surrender control of the Collateral and/or
accept other property in exchange for the Collateral; (e) to enforce payment
and prosecute any action or proceeding with respect to any or all of the
Collateral and take or bring, in the name of the Bank or in the name of
Grantor, any and all steps, actions, suits or proceedings deemed by the Bank
necessary or desirable to effect collection of or to realize upon the
Collateral, INCLUDING any judicial or nonjudicial foreclosure thereof or
thereon, and Grantor specifically consents to any nonjudicial foreclosure of
any or all of the Collateral or any other action taken by the Bank which may
release any obligor from personal liability on any of the Collateral, and
Grantor waives any right not expressly provided for in this Agreement to
receive notice of any public or private judicial or nonjudicial sale or
foreclosure of any security or any of the Collateral; and any money or other
property received by the Bank in exchange for or on account of the
Collateral, whether representing collections or proceeds of Collateral, and
whether resulting from voluntary payments or foreclosure proceedings or other
legal action taken by the Bank or Grantor may be applied by the Bank without
notice to Grantor to the Secured Obligations in such order and manner as the
Bank in its sole discretion shall determine; (k) to insure, process and
preserve the Collateral; (l) to exercise all rights, remedies, powers or
privileges

                                      -3-


provided under any of the Loan Documents; (m) to receive, open and dispose of
all mail addressed to Grantor and notify postal authorities to change the
address for delivery thereof to such address as the Bank may designate;
PROVIDED that the Bank agrees that it will promptly deliver over to Grantor
such opened mail as does not relate to the Collateral; and (n) to exercise
all other rights, powers, privileges and remedies of an owner of the
Collateral; all at the Bank's sole option and as the Bank in its sole
discretion may deem advisable.

               9.  ATTORNEY-IN-FACT.  Grantor hereby irrevocably nominates
and appoints the Bank as its attorney-in-fact for the following purposes,
subject to compliance with the requirements of applicable laws: (a) to do all
acts and things which the Bank may deem necessary or advisable to perfect and
continue perfected the security interests created by this Agreement and, upon
the occurrence and during the continuance of an Event of Default, to
preserve, process, develop, maintain and protect the Collateral; (b) upon the
occurrence and during the continuance of an Event of Default, to do any and
every act which Grantor is obligated to do under this Agreement, at the
expense of Grantor and without any obligation to do so; (c) to prepare, sign,
file and/or record, for Grantor, in the name of Grantor, any financing
statement, application for registration, or like paper, and to take any other
action deemed by the Bank necessary or desirable in order to perfect or
maintain perfected the security interests granted hereby; and (d) upon the
occurrence and during the continuance of an Event of Default, to execute any
and all papers and instruments and do all other things necessary or desirable
to preserve and protect the Collateral and to protect the Bank's security
interests therein; PROVIDED, HOWEVER, that the Bank shall be under no
obligation whatsoever to take any of the foregoing actions, and, absent bad
faith or actual malice, the Bank shall have no liability or responsibility
for any act taken or omission with respect thereto.

               10.  COSTS AND EXPENSES.  Grantor agrees to pay to the Bank
all reasonable costs and expenses (INCLUDING, without limitation, reasonable
attorneys' fees and disbursements) incurred by the Bank in the enforcement or
attempted enforcement of this Agreement (but not the other Loan Documents),
whether or not an action is filed in connection therewith, and in connection
with any waiver or amendment of any term or provision hereof. All advances,
charges, costs and expenses, INCLUDING reasonable attorneys' fees and
disbursements, incurred or paid by the Bank in exercising any right,
privilege, power or remedy conferred by this Agreement, or in the enforcement
or attempted enforcement thereof, shall be secured hereby and shall become a
part of the Secured Obligations and shall be paid to the Bank by Grantor,
immediately upon demand, together with interest thereon at the rate(s)
provided for Base Rate Loans under the Loan Agreement.

               11.  STATUTE OF LIMITATIONS AND OTHER LAWS.  Until the Secured
Obligations shall have been paid and performed in full, the power of sale and
all other rights, privileges, powers and remedies granted to the Bank
hereunder shall continue to exist and may be exercised by the Bank at any
time and from time to time irrespective of the fact that any of the Secured
Obligations may have become barred by any statute of limitations. Grantor
expressly waives the benefit of any and all statutes of limitation, and any
and all laws providing for exemption of property from execution or for
valuation and appraisal upon foreclosure, to the maximum extent permitted by
applicable law.

               12.  OTHER AGREEMENTS.  Nothing herein shall in any way modify
or limit the effect of terms or conditions set forth in any other security or
other agreement executed by Grantor or in connection with the Secured
Obligations, but each and every term and condition hereof shall be in
addition thereto. All provisions contained in the Loan Agreement that apply
to loan

                                      -4-


documents generally are fully applicable to this Agreement and are
incorporated herein by this reference.

               13.  INCORPORATION OF SURETYSHIP PROVISIONS AND WAIVERS.  The
attached EXHIBIT A, "Suretyship Provisions and Waivers", is hereby
incorporated by this reference as though set forth herein in full.

               14.  CONDITION OF BORROWER AND ITS SUBSIDIARIES.  Grantor
represents and warrants to the Bank that Grantor has obtained such
information regarding the Borrower and its subsidiaries and their businesses,
operations and condition (financial and otherwise) and their respective
assets and properties, as it requires as a condition to entering into this
Agreement. Grantor hereby expressly waives and relinquishes any duty on the
part of the Bank (should any such duty exist) to disclose to Grantor any
matter, fact or thing related to the businesses, operations or condition
(financial or otherwise) of the Borrower or its subsidiaries or their
respective assets and properties, whether now known or hereafter known by the
Bank during the life of this Agreement. With respect to any of the Secured
Obligations, the Bank need not inquire into the powers of the Borrower or any
subsidiaries thereof or the officers or employees acting or purporting to act
on their behalf, and all Secured Obligations made or created in good faith
reliance upon the professed exercise of such powers shall be secured hereby.

               15.  LIENS ON REAL PROPERTY.  In the event that all or any
part of the Secured Obligations at any time are secured by any one or more
deeds of trust or mortgages or other instruments creating or granting liens
on any interests in real property, Grantor authorizes the Bank, upon the
occurrence of and during the continuance of any Event of Default, at its sole
option, without notice or demand and without affecting any Secured
Obligations of Grantor, the enforceability of this Agreement, or the validity
or enforceability of any liens of the Bank on any Collateral, to foreclose
any or all of such deeds of trust or mortgages or other instruments by
judicial or nonjudicial sale. Insofar as the liens created herein secure the
obligations of other persons, (i) Grantor expressly waives any defenses to
the enforcement of this Agreement or any liens created or granted hereby or
to the recovery by the Bank against Borrower or any guarantor or any other
person liable therefor of any deficiency after a judicial or nonjudicial
foreclosure or sale, even though such a foreclosure or sale may impair the
subrogation rights of Grantor and may preclude Grantor from obtaining
reimbursement or contribution from any other person, and (ii) Grantor
expressly waives any defenses or benefits that may be derived from California
Code of Civil Procedure Sections 580a, 580b, 580d or 726, or comparable
provisions of the laws of any other jurisdiction, and all other suretyship
defenses it otherwise might or would have under California law or other
applicable law. Grantor expressly waives any right to receive notice of any
judicial or nonjudicial foreclosure or sale of any real property or interest
therein subject to any such deeds of trust or mortgages or other instruments
and Grantor's failure to receive any such notice shall not impair or affect
Grantor's obligations or the enforceability of this Agreement or any liens
created or granted hereby.

               16.  WAIVER OF RIGHTS OF SUBROGATION.  Notwithstanding
anything to the contrary elsewhere contained herein or in the Loan Agreement
to which Grantor is a party until no part of any commitment to lend remains
outstanding and all of the Secured Obligations have been paid and performed
in full, Grantor hereby waive with respect to the Borrower and its successors
and assigns (including any surety) and any other person, any and all rights
at law or in equity to subrogation, to reimbursement, to exoneration, to
contribution, to setoff or to any other rights that could accrue to a surety
against a principal, to a guarantor against a maker or obligor, to an
accommodation party against the party accommodated, or to a holder or
transferee against a maker and which Grantor may have or hereafter acquire

                                      -5-


against the Borrower or any other party in connection with or as a result of
Grantor's execution, delivery and/or performance of this Agreement or any
other loan document to which Grantor is a party. Grantor agrees that it shall
not have or assert any such rights against the Borrower or its successors and
assigns or any other attempted setoff to any action commenced against Grantor
by the Borrower (as borrower or in any other capacity) or any other person.
Grantor hereby acknowledges and agrees that this waiver is intended to
benefit the Bank and shall not limit or otherwise affect Grantor's liability
hereunder, under any other Loan Document to which Grantor is a party, or the
enforceability hereof or thereof.

               17.  UNDERSTANDINGS WITH RESPECT TO WAIVERS AND CONSENTS.
Grantor warrants and agrees that each of the waivers and consents set forth
herein are made after consultation with legal counsel and with full knowledge
of their significance and consequences, with the understanding that events
giving rise to any defense or right waived may diminish, destroy or otherwise
adversely affect rights which Grantor otherwise may have against the
Borrower, the Bank or others, or against Collateral, and that, under the
circumstances, the waivers and consents herein given are reasonable and not
contrary to public policy or law. If any of the waivers or consents herein
are determined to be contrary to any applicable law or public policy, such
waivers and consents shall be effective to the maximum extent permitted by
law.

               18.  CONTINUING EFFECT.  This Agreement shall remain in full
force and effect and continue to be effective should any petition be filed by
or against Grantor for liquidation or reorganization, should Grantor become
insolvent or make an assignment for the benefit of creditors or should a
receiver or trustee be appointed for all or any significant part of Grantor's
assets, and shall continue to be effective or be reinstated, as the case may
be, if at any time payment and performance of the Secured Obligations, or any
part thereof, is, pursuant to applicable law, rescinded or reduced in amount,
or must otherwise be restored or returned by the Bank, whether as a "voidable
preference," "fraudulent conveyance," or otherwise, all as though such
payment or performance had not been made. In the event that any payment or
any part thereof is rescinded, reduced, restored or returned, the Secured
Obligations shall be reinstated and deemed reduced only by such amount paid
and not so rescinded, reduced, restored or returned.

               19.  RELEASE OF GRANTOR.  This Agreement and all Secured
Obligations of Grantor hereunder shall be released as provided in Section 3.6
of the Loan Agreement when all Secured Obligations have been paid in full in
Cash or otherwise performed in full and when the Bank's financing commitments
under the Facility No. 2 term loan no longer remain outstanding. Upon such
release of Grantor's Secured Obligations hereunder, the Bank promptly shall
return any pledged Collateral to Grantor, or to the person or persons legally
entitled thereto, and promptly shall endorse, execute, deliver, record and
file all instruments and documents, and do all other acts and things,
reasonably required for the return of the Collateral to Grantor, or to the
person or persons legally entitled thereto, and to evidence or document the
release of the Bank's interests arising under this Agreement, all as
reasonably requested by, and at the sole expense of, Grantor.

               20.  ARBITRATION.

                    (a)  This Section concerns the resolution of any
      controversies or claims between Grantor and the Bank, including but not
      limited to those that arise from:

                         1)  This Agreement (including any renewals,
               extensions or modifications of this Agreement);

                                      -6-


                         2)  Any document, agreement or procedure related to
               or delivered in connection with this Agreement;

                         3)  Any violation of this Agreement; or

                         4)  Any claims for damages resulting from the
               transactions contemplated hereby, including claims for injury to
               persons, property or business interests (torts).

                    (b)  At the request of Grantor or the Bank, any such
      controversies or claims will be settled by arbitration in accordance with
      the United States Arbitration Act. The United States Arbitration Act will
      apply even though this Agreement provides that it is governed by
      California law.

                    (c)  Arbitration proceedings will be administered by the
      American Arbitration Association and will be subject to its commercial
      rules of arbitration. The arbitration will be conducted in California
      within the following county or counties: Los Angeles or San Diego.

                    (d)  For purposes of the application of the statute of
      limitations, the filing of an arbitration pursuant to this Section is the
      equivalent of the filing of a lawsuit, and any claim or controversy which
      may be arbitrated under this Section is subject to any applicable statute
      of limitations. The arbitrators will have the authority to decide whether
      any such claim or controversy is barred by the statute of limitations and,
      if so, to dismiss the arbitration on that basis.

                    (e)  If there is a dispute as to whether an issue is
      arbitrable, the arbitrators will have the authority to resolve any such
      dispute.

                    (f)  The decision that results from an arbitration
      proceeding may be submitted to any authorized court of law to be confirmed
      and enforced.

                    (g)  The procedure described above will not apply if the
      controversy or claim, at the time of the proposed submission to
      arbitration, arises from or relates to an obligation to the Bank secured
      by real property located in California. In this case, both Grantor and the
      Bank must consent to submission of the claim or controversy to
      arbitration. If both parties do not consent to arbitration, the
      controversy or claim will be settled as follows:

                         (i)    Grantor and the Bank will designate a
               referee (or a panel of referees) selected under the auspices of
               the American Arbitration Association in the same manner as
               arbitrators are selected in Association-sponsored proceedings;

                        (ii)    The designated referee (or the panel of
               referees) will be appointed by a court as provided in California
               Code of Civil Procedure Section 638 and the following related
               sections;

                       (iii)    The referee (or the presiding referee of
               the panel) will be an active attorney or a retired judge; and

                        (iv)    The award that results from the decision of
               the referee (or the panel) will be entered as a judgment in the
               court that appointed the referee, in accordance with the
               provisions of California Code of Civil Procedure Sections 644 and
               645.

                                      -7-


                    (h)  This provision does not limit the right of Grantor or
the Bank to:

                         (i)    exercise self-help remedies such as setoff;

                        (ii)    foreclose against or sell any real or personal
                    property collateral; or

                       (iii)    act in a court of law, before, during or after
                    the arbitration proceeding to obtain:

                                a)  an interim remedy; and/or

                                b)  additional or supplementary remedies.

                    (i)  The pursuit of or a successful action for interim,
      additional or supplementary remedies, or the filing of a court action,
      does not constitute a waiver of the right of Grantor or the Bank,
      including the suing party, to submit the controversy or claim to
      arbitration if the other party contests the lawsuit. However, if the
      controversy or claim arises from or relates to an obligation to the Bank
      which is secured by real property located in California at the time of the
      proposed submission to arbitration, this right is limited according to the
      provision above requiring the consent of both Grantor and the Bank to seek
      resolution through arbitration.

                    (j)  If the Bank forecloses against any real property
      securing this Agreement, the Bank has the option to exercise the power of
      sale under the deed of trust or mortgage, or to proceed by judicial
      foreclosure.

               21.  COUNTERPARTS.  This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original and all of
which, taken together, shall constitute one and the same agreement.

               22.  GOVERNING LAW.  THIS AGREEMENT SHALL BE CONSTRUED AND
ENFORCED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF
CALIFORNIA.




                                      -8-


               23.  WAIVER OF JURY TRIAL.  GRANTOR AND THE BANK EXPRESSLY
WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION
OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT,
THE LOAN AGREEMENT, THE OTHER LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE
BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR PARTIES, WHETHER NOW
EXISTING OR HEREAFTER ARISING AND WHETHER WITH RESPECT TO CONTRACT CLAIMS,
TORT CLAIMS, OR OTHERWISE. EACH GRANTOR AND THE BANK AGREE THAT ANY SUCH
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL
WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE
THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS
SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN
WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS
AGREEMENT, THE LOAN AGREEMENT OR THE OTHER LOAN DOCUMENTS OR ANY PROVISION
HEREOF OR THEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT, THE LOAN AGREEMENT
AND THE OTHER LOAN DOCUMENTS. ANY PARTY HERETO MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF
THE CONSENT OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL
BY JURY.

               IN WITNESS WHEREOF, Grantor has executed this Agreement by its
duly authorized officer as of the date first written above.

                                          "Grantor"

                                          METRA BIOSYSTEMS, INC.,
                                          a California corporation


                                          By:   /s/ George W. Dunbar
                                              --------------------------------
                                          George Dunbar, President


                                          By:  /s/ Mark Weeks
                                              --------------------------------
                                          Mark Weeks, Secretary

ACCEPTED AND AGREED
AS OF THE DATE FIRST
ABOVE WRITTEN:

BANK OF AMERICA NATIONAL
TRUST AND SAVINGS ASSOCIATION


By:   /s/ Karin S. Barnes
    --------------------------------

Title:   Vice President
       -----------------------------


                                      -9-


                                    EXHIBIT A
                                       TO
                            CASH COLLATERAL AGREEMENT

                        SURETYSHIP PROVISIONS AND WAIVERS


         Grantor acknowledges that the liens and security interests created
or granted herein will or may secure obligations of persons other than
Grantor and, in full recognition of that fact, Grantor consents and agrees
that the Bank may, at any time and from time to time, without notice or
demand, and without affecting the enforceability or security hereof:

                  (a)  supplement, modify, amend, extend, renew, or otherwise
      change the time for payment or the terms of the Secured Obligations or any
      part thereof, including any increase or decrease of the rate(s) of
      interest thereon;

                  (b)  supplement, modify, amend or waive, or enter into or give
      any agreement, approval or consent with respect to, the Secured
      Obligations or any part thereof or any provision of the Loan Agreement or
      of any other agreement, document or instrument executed and delivered in
      connection with the Loan Agreement (collectively with the Loan Agreement,
      the "Loan Documents"), or any condition, covenant, default, remedy, right,
      representation or term thereof or thereunder;

                  (c)  accept new or additional instruments, documents or
      agreements in exchange for or relative to any of the Loan Documents or the
      Secured Obligations or any part thereof;

                  (d)  accept partial payments on the Secured Obligations;

                  (e)  receive and hold additional security or guaranties for
      the Secured Obligations or any part thereof;

                  (f)  release, reconvey, terminate, waive, abandon,
      subordinate, exchange, substitute, transfer and enforce any security or
      guaranties, and apply any security and direct the order or manner of
      sale thereof as the Bank in its sole and absolute discretion may
      determine;

                  (g)  release any person or any guarantor from any personal
      liability with respect to the Secured Obligations or any part thereof;

                  (h)  settle, release on terms satisfactory to the Bank or by
      operation of applicable laws or otherwise liquidate or enforce any Secured
      Obligations and any security or guaranty therefor in any manner, consent
      to the transfer of any security and bid and purchase at any sale; and

                  (i)  consent to the merger, change or any other restructuring
      or termination of the corporate existence of the Borrower or any other
      person, and correspondingly restructure the Secured Obligations, and any
      such merger, change, restructuring or termination shall not affect the
      liability of Grantor or the continuing existence of any liens hereunder,
      under any other Loan Document to which Grantor is a party or the
      enforceability hereof or thereof with respect to all or any part of the
      Secured Obligations.

         Upon the occurrence of and during the continuance of any Event of
Default, the Bank may enforce this Agreement independently as to Grantor and

                                      -1-


independently of any other remedy or security the Bank at any time may have
or hold in connection with the Secured Obligations, and it shall not be
necessary for the Bank to marshal assets in favor of Grantor, the Borrower or
any other person or to proceed upon or against and/or exhaust any other
security or remedy before proceeding to enforce this Agreement. Grantor
expressly waives any right to require the Bank to marshal assets in favor of
Grantor, the Borrower or any other person or to proceed against any other
person or any collateral provided by any other person, and agrees that the
Bank may proceed against any person and/or collateral in such order as it
shall determine in its sole and absolute discretion. The Bank may file a
separate action or actions against Grantor, whether action is brought or
prosecuted with respect to any other security or against the Borrower or any
other person, or whether any other person is joined in any such action or
actions. Grantor agrees that the Bank and the Borrower and any other person
may deal with each other in connection with the Secured Obligations or
otherwise, or alter any contracts or agreements now or hereafter existing
between any of them, in any manner whatsoever, all without in any way
altering or affecting the security of this Agreement. The Bank's rights
hereunder shall be reinstated and revived, and the enforceability of this
Agreement shall continue, with respect to any amount at any time paid on
account of the Secured Obligations which thereafter shall be required to be
restored or returned by the Bank upon the bankruptcy, insolvency or
reorganization of the Borrower, Grantor or any other person, or otherwise,
all as though such amount had not been paid. The liens created or granted
herein and the enforceability of this Agreement at all times shall remain
effective to secure the full amount of all the Secured Obligations including,
without limitation, the amount of all loans and interest thereon at the rates
provided for in the Loan Agreement and the note(s) thereunder, even though
the Secured Obligations, including any part thereof or any other security or
guaranty therefor, may be or hereafter may become invalid or otherwise
unenforceable as against the Borrower or any other person and whether or not
the Borrower or any other person shall have any personal liability with
respect thereto. Grantor expressly waives any and all defenses now or
hereafter arising or asserted by reason of (a) any disability or other
defense of the Borrower or any other person with respect to the Secured
Obligations, (b) the unenforceability or invalidity of any security or
guaranty for the Secured Obligations or the lack of perfection or continuing
perfection or failure of priority of any security for the Secured
Obligations, (c) the cessation for any cause whatsoever of the liability of
the Borrower or any other person (other than by reason of the full payment
and performance of all Secured Obligations), (d) any failure of the Bank to
marshal assets in favor of Grantor or any other person, (e) except as
otherwise required by law or as provided in this Agreement, any failure of
the Bank to give notice of sale or other disposition of collateral to Grantor
or any other person or any defect in any notice that may be given in
connection with any sale or disposition of collateral, (f) except as
otherwise required by law or as provided in this Agreement, any failure of
the Bank to comply with applicable laws in connection with the sale or other
disposition of any collateral or other security for any Obligation, including
without limitation any failure of the Bank to conduct a commercially
reasonable sale or other disposition of any collateral or other security for
any Obligation, (g) any act or omission of the Bank or others that directly
or indirectly results in or aids the discharge or release of the Borrower,
Grantor or any other person or the Secured Obligations or any other security
or guaranty therefor by operation of law, (h) any law which provides that the
obligation of a surety or guarantor must neither be larger in amount nor in
other respects more burdensome than that of the principal or which reduces a
surety's or guarantor's obligation in proportion to the principal obligation,
(i) any failure of the Bank to file or enforce a claim in any bankruptcy or
other proceeding with respect to any person, (j) the election by the Bank, in
any bankruptcy proceeding of any person, of the application or
non-application of Section 1111(b)(2) of the United States Bankruptcy Code,
(k) any extension of credit or the grant of any liens under Section 364 of
the United States Bankruptcy Code, (l) any use of cash collateral under
Section 363 of the United States Bankruptcy Code, (m) any agreement or
stipulation with respect to the provision of adequate protection in any
bankruptcy proceeding of any person, (n) the avoidance of any liens in favor
of the Bank for any reason, (o) any bankruptcy, insolvency, reorganization,
arrangement, readjustment of debt, liquidation or dissolution proceeding
commenced by or against any person, including any discharge of, or bar or
stay against collecting, all or any of the Secured Obligations (or any
interest thereon) in or as a result of

                                      -2-


any such proceeding, or (p) to the extent permitted, the benefits of any form
of one-action rule. Until no part of any commitment to lend remains
outstanding and all of the Secured Obligations have been paid and performed
in full, Grantor shall have no right of subrogation, contribution,
reimbursement or indemnity, and Grantor expressly waives any right to enforce
any remedy that the Bank now has or hereafter may have against any other
person and waives the benefit of, or any right to participate in, any other
security now or hereafter held by the Bank. Grantor expressly waives all
setoffs and counterclaims and all presentments, demands for payment or
performance, notices of nonpayment or nonperformance, protests, notices of
protest, notices of dishonor and all other notices or demands of any kind or
nature whatsoever with respect to the Secured Obligations, and all notices of
acceptance of this Agreement or of the existence, creation or incurring of
new or additional Secured Obligations.






                                      -3-