Exhibit 10.3
 
REGISTRATION RIGHTS AGREEMENT

This Registration Rights Agreement (the “Agreement”) is made and entered into as
of this 30th day of June, 2008 by and between NexMed, Inc., a Nevada corporation
(the “Company”), and the “Purchasers” named in that Purchase Agreement of even
date herewith by and between the Company and the Purchasers (the “Purchase
Agreement”).

The parties hereby agree as follows:

1. Certain Definitions

As used in this Agreement, the following terms shall have the following
meanings:

“Common Stock” shall mean the Company’s common stock, par value $0.001 per
share.

“Investor” and “Investors” shall mean the Purchaser(s) identified in the
Purchase Agreement and any transferee of the Purchaser(s) who is a permitted
assignee of any Notes or Registrable Securities.

“Notes” shall mean the Company’s 7% Convertible Notes Due December 31, 2011
issued and sold to the Purchasers pursuant to the Purchase Agreement.

“Prospectus” shall mean the prospectus included in any Registration Statement,
as amended or supplemented by any prospectus supplement, with respect to the
terms of the offering of any portion of the Registrable Securities covered by
such Registration Statement and by all other amendments and supplements to the
prospectus, including post-effective amendments and all material incorporated by
reference in such prospectus.

“Register,” “registered” and “registration” refer to a registration made by
preparing and filing a registration statement or similar document in compliance
with the 1933 Act (as defined below), and the declaration or ordering of
effectiveness of such registration statement or document.

“Registrable Securities” shall mean (a) the Underlying Shares (without regard to
any limitations on beneficial ownership contained in the Notes) or other
securities issued or issuable to each Holder or its permitted transferee or
designee (i) upon conversion of the Notes, or (ii) upon any distribution with
respect to, any exchange for or any replacement of such Notes or (iii) upon any
conversion, exercise or exchange of any securities issued in connection with any
such distribution, exchange or replacement; (b) securities issued or issuable
upon any stock split, stock dividend, recapitalization or similar event with
respect to the foregoing; and (c) any other security issued as a dividend or
other distribution with respect to, in exchange for or in replacement of the
securities referred to in the preceding clauses.

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“Registration Statement” shall mean any registration statement filed under the
1933 Act of the Company that covers the resale of any of the Registrable
Securities pursuant to the provisions of this Agreement, amendments and
supplements to such Registration Statement, including post-effective amendments,
all exhibits and all material incorporated by reference in such Registration
Statement.

“SEC” means the U.S. Securities and Exchange Commission.

“1933 Act” means the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.

“1934 Act” means the Securities Exchange Act of 1934, as amended, and the rules
and regulations promulgated thereunder.

2. Registration.

(a) Registration Statements. Promptly following the closing of the purchase and
sale of the Notes contemplated by the Purchase Agreement (the “Closing Date”)
(but no later than thirty (30) days after the Closing Date), the Company shall
prepare and file with the SEC one Registration Statement on Form S-3 (or, if
Form S-3 is not then available to the Company, on such form of registration
statement as is then available to effect a registration for resale of the
Registrable Securities, subject to the Investor’s consent) covering the resale
of the Registrable Securities in an amount equal to 130% of the number of shares
of Common Stock necessary to permit the conversion in full of the Notes (without
regard to any limitations on beneficial ownership contained therein). Such
Registration Statement also shall cover, to the extent allowable under the 1933
Act and the Rules promulgated thereunder (including Rule 416), such
indeterminate number of additional shares of Common Stock resulting from stock
splits, stock dividends or similar transactions with respect to the Registrable
Securities. Except for 250,000 shares of Common Stock underlying warrants issued
to Southpoint Master Fund LP, no securities shall be included in the
Registration Statement other than the Registrable Securities without the consent
of the Investors holding a majority of the Registrable Securities (on an
as-converted basis), which consent shall not be unreasonably withheld. The
Registration Statement (and each amendment or supplement thereto, and each
request for acceleration of effectiveness thereof) shall be provided in
accordance with Section 3(c) to the Investor and its counsel prior to its filing
or other submission. In the event any Registrable Securities are not covered by
the Registration Statement, the Company shall promptly amend such Registration
Statement or prepare and file with the SEC a new Registration Statement in
accordance with the terms hereof in order to cause such Registrable Securities
to be covered by a Registration Statement. If the Registration Statement
covering the Registrable Securities is not filed within 30 days following the
Closing Date, then the Company will make pro-rata payments to the Purchasers as
liquidated damages and not as a penalty, in an amount equal to 2% of the sum of
the aggregate principal amount then outstanding under the Notes for each month
(or portion thereof) following such 30th day during which such Registration
Statement has not yet been filed. Each such payment shall be due and payable
within five (5) days of the end of each month (or ending portion thereof) until
such Registration Statement is so filed. Such payments shall be in partial
compensation to the Purchasers, and shall not constitute the Purchasers’
exclusive remedy for such events.

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(b) Expenses. The Company will pay all expenses associated with each
registration, but excluding discounts, commissions, fees of underwriters,
selling brokers, dealer managers or similar securities industry professionals.

(c) Effectiveness.

(i) The Company shall use its best efforts to have each Registration Statement
declared effective as soon as practicable, but in no event later than the
earlier of (a) 120 days following the Closing Date (or the date of the
occurrence of additional Registrable Securities, as the case may be) and (b) 5
days following the date on which the SEC notifies the Company or its counsel
that the Registration Statement is not subject to any further review. In
connection therewith, the Company shall respond to all SEC comments on the
Registration Statement and file any amendments to the Registration Statement
within 15 business days following any date on which the SEC furnishes comments
to, asks questions of, or requests further information from, the Company or its
counsel with respect to the Registration Statement or any part thereof or any
document incorporated by reference therein. After any Registration Statement is
declared effective by the SEC, the Company shall cause such Registration
Statement to remain effective in accordance with the terms hereof, subject to
permitted suspension of such effectiveness only for Allowed Delays (as defined
below). On or prior to the date any Registration Statement is declared effective
by the SEC, the Company shall cause the Registrable Securities to be
specifically listed or included for quotation on an Approved Market, and
maintain such listing and quotation for the Registrable Securities and the
Common Stock in general.
 
(ii) For not more than twenty (20) consecutive Trading Days (as defined in the
Notes) and for a total of not more than thirty (30) Trading Days in any twelve
(12) consecutive month period, the Company may delay the disclosure of material
non-public information concerning the Company, by terminating or suspending
effectiveness of any registration contemplated by this Section not containing
such information, the disclosure of which at the time is not, in the good faith
opinion of the Company, in the best interests of the Company (an “Allowed
Delay”); provided, that the Company shall promptly (a) notify the Investor in
writing of the existence of (but in no event, without the prior written consent
of the Investor, shall the Company disclose to the Investor any of the facts or
circumstances regarding) material non-public information giving rise to an
Allowed Delay, and (b) advise the Investor in writing to cease all sales under
the Registration Statement until the end of the Allowed Delay. The duration of
the Registration Period will be extended by the number of days of any and all
Allowed Delays.

(d) Underwritten Offering. If any offering pursuant to a Registration Statement
pursuant to Section 2(a) hereof involves an underwritten offering, the Company
shall have the right to select an investment banker and manager to administer
the offering, which investment banker or manager shall be reasonably
satisfactory to the Investor.

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(e) Registration Defaults. If (A) the Registrable Securities specifically are
not listed or included for quotation on an Approved Market or trading of the
Common Stock is suspended or halted thereon, or (B) the Company fails, refuses
or is otherwise unable to timely issue Underlying Shares in accordance with the
terms of the Notes, or unlegended certificates for the Underlying Shares as
required under the Agreements, in each case within ten (10) business days
following the Purchaser’s written demand for issuance of such Underlying Shares
or certificates, then the Company will make pro-rata payments to the Purchasers
as liquidated damages and not as a penalty, in an amount equal to 2% of the sum
of the aggregate principal amount then outstanding under the Notes for each
month (pro rated for partial months) following the Registration Date during
which any of the events described in (A), (B), (C) or (D) above occurs and is
continuing (the “RRA Default Period”). Each such payment shall be due and
payable within five (5) days of the end of each month (or ending portion
thereof) of the RRA Default Period until the termination of the RRA Default
Period. Such payments shall be in partial compensation to the Purchasers, and
shall not constitute the Purchasers’ exclusive remedy for such events. The RRA
Default Period shall terminate upon (x) listing or inclusion and/or trading of
the Registrable Securities on an Approved Market in the case of (A) above, and
(y) delivery of such shares in the case of (B) above. The amounts payable as
liquidated damages pursuant to this paragraph shall be payable in lawful money
of the United States.

3. Company Obligations. The Company will use its best efforts to effect the
registration of the Registrable Securities in accordance with the terms hereof,
and pursuant thereto the Company will, as expeditiously as possible:

(a) use its best efforts to cause such Registration Statement to become
effective and to remain continuously effective for a period (the “Registration
Period”) that will terminate upon the earlier of the date on which all
Registrable Securities, covered by such Registration Statement, as amended from
time to time (i) have been sold or (ii) become available for resale without
registration or limitation pursuant to Rule 144 of the 1933 Act (but not less
than one year following the Closing Date).

(b) prepare and file with the SEC such amendments and post-effective amendments
to the Registration Statement and the Prospectus as may be necessary to keep the
Registration Statement effective for the period specified in Section 3(a) and to
comply with the provisions of the 1933 Act and the 1934 Act with respect to the
distribution of all Registrable Securities; provided that, at least three (3)
days prior to the filing of a Registration Statement or Prospectus, or any
amendments or supplements thereto, the Company will furnish to the Investor
copies of all documents proposed to be filed;

(c) permit counsel designated by the Investor to review each Registration
Statement and all amendments and supplements thereto no fewer than five (5)
business days prior to their filing with the SEC and not file any document to
which such counsel reasonably objects on the basis that such document contains a
material misstatement or omission;

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(d) furnish to the Investor and its legal counsel (i) promptly after the same is
prepared and publicly distributed, filed with the SEC, or received by the
Company, one copy of any Registration Statement and any amendment thereto, each
preliminary prospectus and Prospectus and each amendment or supplement thereto,
and each letter written by or on behalf of the Company to the SEC or the staff
of the SEC, and each item of correspondence from the SEC or the staff of the
SEC, in each case relating to such Registration Statement (other than any
portion of any thereof which contains information for which the Company has
sought confidential treatment, and provided that such items shall be redacted
prior to delivering to the Investor and its counsel to the extent necessary to
avoid disclosure of material non-public information concerning the Company), and
(ii) such number of copies of a Prospectus, including a preliminary prospectus,
and all amendments and supplements thereto and such other documents as such
Investor may reasonably request in order to facilitate the disposition of the
Registrable Securities owned by such Investor;

(e) in the event the Company selects an underwriter for the offering, the
Company shall enter into and perform its reasonable obligations under an
underwriting agreement, in usual and customary form, including, without
limitation, customary indemnification and contribution obligations, with the
underwriter of such offering;

(f) if required by the underwriter, at the request of the Investor, the Company
shall furnish, on the date that Registrable Securities, as applicable, are
delivered to an underwriter, if any, for sale in connection with the
Registration Statement (i) an opinion, dated as of such date, from counsel
representing the Company for purposes of such Registration Statement, in form,
scope and substance as is customarily given in an underwritten public offering,
addressed to the underwriter and the Investor and (ii) a letter, dated such
date, from the Company’s independent certified public accountants in form and
substance as is customarily given by independent certified public accountants to
underwriters in an underwritten public offering, addressed to the underwriter
and the Investor;

(g) make reasonable effort to prevent the issuance of any stop order or other
suspension of effectiveness and, if such order is issued, obtain the withdrawal
of any such order at the earliest possible moment;

(h) prior to any public offering of Registrable Securities, use its reasonable
best efforts to register or qualify or cooperate with the Investor and its
counsel in connection with the registration or qualification of such Registrable
Securities for offer and sale under the securities or blue sky laws of such
jurisdictions as the Investor reasonably requests in writing and do any and all
other reasonable acts or things necessary or advisable to enable the
distribution in such jurisdictions of the Registrable Securities covered by the
Registration Statement, provided that the Company shall not be required in
connection therewith or as a condition thereto to qualify to do business or to
file a general consent to service of process in any such states or
jurisdictions, or to become subject to any tax in any such state or jurisdiction
where it is not otherwise subject;

(i) cause all Registrable Securities covered by a Registration Statement to be
listed on each securities exchange, interdealer quotation system or other market
on which similar securities issued by the Company are then quoted or listed;

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(j) immediately notify the Investor, at any time when a Prospectus relating to
the Registrable Securities is required to be delivered under the Securities Act,
upon discovery that, or upon the happening of any event as a result of which,
the Prospectus included in such Registration Statement, as then in effect,
includes an untrue statement of a material fact or omits to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading in the light of the circumstances then existing, and at the
request of any such holder, promptly prepare and furnish to such holder a
reasonable number of copies of a supplement to or an amendment of such
Prospectus as may be necessary so that, as thereafter delivered to the
purchasers of such Registrable Securities, such Prospectus shall not include an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading in
the light of the circumstances then existing; and

(k) otherwise use its best efforts to comply with all applicable rules and
regulations of the SEC under the 1933 Act and the 1934 Act, take such other
actions as may be reasonably necessary to facilitate the registration of the
Registrable Securities hereunder; and make available to its security holders, as
soon as reasonably practicable, but not later than the Availability Date (as
defined below), an earnings statement covering a period of at least twelve
months, beginning after the effective date of each Registration Statement, which
earnings statement shall satisfy the provisions of Section 11(a) of the 1933 Act
(for the purpose of this subsection 3(l), “Availability Date” means the 45th day
following the end of the fourth fiscal quarter that includes the effective date
of such Registration Statement, except that, if such fourth fiscal quarter is
the last quarter of the Company’s fiscal year, “Availability Date” means the
90th day after the end of such fourth fiscal quarter).

4. Obligations of the Investor.

(a) It shall be a condition precedent to the obligations of the Company to
complete the registration pursuant to this Agreement with respect to the
Registrable Securities, that the Investor shall furnish in writing to the
Company such information regarding itself, the Registrable Securities held by it
and the intended method of disposition of the Registrable Securities held by it,
as shall be reasonably required to effect the registration of such Registrable
Securities, and shall execute such documents in connection with such
registration as the Company may reasonably request. At least fifteen (15)
business days prior to the first anticipated filing date of any Registration
Statement, the Company shall notify the Investor of the information the Company
requires from the Investor if the Investor elects to have any of the Registrable
Securities included in the Registration Statement. The Investor shall provide
such information to the Company at least ten (10) business days prior to the
first anticipated filing date of such Registration Statement if the Investor
elects to have any of the Registrable Securities included in the Registration
Statement.

(b) The Investor, by its acceptance of the Registrable Securities, agrees to
cooperate with the Company as reasonably requested by the Company in connection
with the preparation and filing of a Registration Statement hereunder, unless
such Investor has notified the Company in writing of its election to exclude all
of its Registrable Securities from the Registration Statement, in which case the
Investor shall be deemed to have waived its rights to have Registrable
Securities registered under this Agreement, unless the Investor has good cause
for such an election.

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(c) In the event the Company determines to engage the services of an
underwriter, the Investor agrees to enter into and perform its obligations under
an underwriting agreement, in usual and customary form, including, without
limitation, customary indemnification and contribution obligations, with the
managing underwriter of such offering and take such other actions as are
reasonably required in order to expedite or facilitate the dispositions of the
Registrable Securities.

(d) The Investor agrees that, upon receipt of any notice from the Company of the
happening of any event rendering a Registration Statement no longer effective,
the Investor will immediately discontinue disposition of Registrable Securities
pursuant to the Registration Statement covering such Registrable Securities,
until the Investor’s receipt of the copies of the supplemented or amended
prospectus filed with the SEC and declared effective and, if so directed by the
Company, the Investor shall deliver to the Company (at the expense of the
Company) or destroy (and deliver to the Company a certificate of destruction)
all copies in the Investor’s possession of the prospectus covering the
Registrable Securities, current at the time of receipt of such notice.

(e) The Investor may not participate in any underwritten registration hereunder
unless it (i) agrees to sell the Registrable Securities on the basis provided in
any underwriting arrangements in usual and customary form entered into by the
Company, (ii) completes and executes all questionnaires, powers of attorney,
indemnities, underwriting agreements and other documents reasonably required
under the terms of such underwriting arrangements, and (iii) agrees to pay its
pro rata share of all underwriting discounts and commissions and any expenses in
excess of those payable by the Company pursuant to the terms of this Agreement.

5. Indemnification.

(a) Indemnification by Company. The Company agrees to indemnify and hold
harmless, to the fullest extent permitted by law the Investor, its officers,
directors, stockholders and employees and each person who controls such Investor
(within the meaning of the 1933 Act) against all losses, claims, damages,
liabilities, costs (including, without limitation, reasonable attorney’s fees)
and expenses imposed on such person caused by (i) any untrue or alleged untrue
statement of a material fact contained in any Registration Statement, Prospectus
or any preliminary prospectus or any amendment or supplement thereto or any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
except insofar as the same are based upon any information furnished in writing
to the Company by such Investor, expressly for use therein, or (ii) any
violation by the Company of any federal, state or common law, rule or regulation
applicable to the Company in connection with any Registration Statement,
Prospectus or any preliminary prospectus, or any amendment or supplement
thereto, and shall reimburse in accordance with subparagraph (c) below, each of
the foregoing persons for any legal and any other expenses reasonably incurred
in connection with investigating or defending any such claims. The foregoing is
subject to the condition that, insofar as the foregoing indemnities relate to
any untrue statement, alleged untrue statement, omission or alleged omission
made in any preliminary prospectus or Prospectus that is eliminated or remedied
in any Prospectus or amendment or supplement thereto, the above indemnity
obligations of the Company shall not inure to the benefit of any indemnified
party if a copy of such corrected Prospectus or amendment or supplement thereto
had been made available to such indemnified party and was not sent or given by
such indemnified party at or prior to the time such action was required of such
indemnified party by the 1933 Act and if delivery of such Prospectus or
amendment or supplement thereto would have eliminated (or been a sufficient
defense to) any liability of such indemnified party with respect to such
statement or omission. Indemnity under this Section 5(a) shall remain in full
force and effect regardless of any investigation made by or on behalf of any
indemnified party and shall survive the permitted transfer of the Registrable
Securities.

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(b) Indemnification by Holder. In connection with any registration pursuant to
the terms of this Agreement, the Investor will furnish to the Company in writing
such information as the Company reasonably requests concerning the holders of
Registrable Securities or the proposed manner of distribution for use in
connection with any Registration Statement or Prospectus and agrees to indemnify
and hold harmless, to the fullest extent permitted by law, the Company, its
directors, officers, employees, stockholders and each person who controls the
Company (within the meaning of the 1933 Act) against any losses, claims,
damages, liabilities and expense (including reasonable attorney’s fees)
resulting from any untrue statement of a material fact or any omission of a
material fact required to be stated in the Registration Statement or Prospectus
or preliminary prospectus or amendment or supplement thereto or necessary to
make the statements therein not misleading, to the extent, but only to the
extent that such untrue statement or omission is contained in any information
furnished in writing by such Investor to the Company specifically for inclusion
in such Registration Statement or Prospectus or amendment or supplement thereto
and that such information was substantially relied upon by the Company in
preparation of the Registration Statement or Prospectus or any amendment or
supplement thereto. In no event shall the liability of an Investor be greater in
amount than the dollar amount of the proceeds (net of all expense paid by such
Investor and the amount of any damages such holder has otherwise been required
to pay by reason of such untrue statement or omission) received by such Investor
upon the sale of the Registrable Securities included in the Registration
Statement giving rise to such indemnification obligation.

(c) Conduct of Indemnification Proceedings. Any person entitled to
indemnification hereunder shall (i) give prompt notice to the indemnifying party
of any claim with respect to which it seeks indemnification and (ii) permit such
indemnifying party to assume the defense of such claim with counsel reasonably
satisfactory to the indemnified party; provided that any person entitled to
indemnification hereunder shall have the right to employ separate counsel and to
participate in the defense of such claim, but the fees and expenses of such
counsel shall be at the expense of such person unless (a) the indemnifying party
has agreed to pay such fees or expenses, or (b) the indemnifying party shall
have failed to assume the defense of such claim and employ counsel reasonably
satisfactory to such person or (c) in the reasonable judgment of any such
person, based upon written advice of its counsel, a conflict of interest exists
between such person and the indemnifying party with respect to such claims (in
which case, if the person notifies the indemnifying party in writing that such
person elects to employ separate counsel at the expense of the indemnifying
party, the indemnifying party shall not have the right to assume the defense of
such claim on behalf of such person); and provided, further, that the failure of
any indemnified party to give notice as provided herein shall not relieve the
indemnifying party of its obligations hereunder, except to the extent that such
failure to give notice shall materially adversely affect the indemnifying party
in the defense of any such claim or litigation. It is understood that the
indemnifying party shall not, in connection with any proceeding in the same
jurisdiction, be liable for fees or expenses of more than one separate firm of
attorneys at any time for all such indemnified parties. No indemnifying party
will, except with the consent of the indemnified party, consent to entry of any
judgment or enter into any settlement that does not include as an unconditional
term thereof the giving by the claimant or plaintiff to such indemnified party
of a release from all liability in respect of such claim or litigation.

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(d) Contribution. If for any reason the indemnification provided for in the
preceding paragraphs (a) and (b) is unavailable to an indemnified party or
insufficient to hold it harmless, other than as expressly specified therein,
then the indemnifying party shall contribute to the amount paid or payable by
the indemnified party as a result of such loss, claim, damage or liability in
such proportion as is appropriate to reflect the relative fault of the
indemnified party and the indemnifying party, as well as any other relevant
equitable considerations. No person guilty of fraudulent misrepresentation
within the meaning of Section 11(f) of the 1933 Act shall be entitled to
contribution from any person not guilty of such fraudulent misrepresentation. In
no event shall the contribution obligation of a holder of Registrable Securities
be greater in amount than the dollar amount of the proceeds (net of all expenses
paid by such holder and the amount of any damages such holder has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission) received by it upon the sale of all the Registrable
Securities sold by such indemnified party which were covered by the relevant
Registration Statement or Prospectus contained therein.

6. Miscellaneous.

(a) Amendments and Waivers. This Agreement may be amended only by a writing
signed by the parties hereto. The Company may take any action herein prohibited,
or omit to perform any act herein required to be performed by it, only if the
Company shall have obtained the written consent to such amendment, action or
omission to act, of the Investor.

(b) Notices. All notices and other communications provided for or permitted
hereunder shall be made as set forth in the Purchase Agreement.

(c) Assignments and Transfers by Investor. This Agreement and all the rights and
obligations of the Investor hereunder may not be assigned or transferred to any
transferee or assignee except to a holder of any Notes or Registrable Securities
which is a permitted assignee pursuant to the assignment provisions of such
instruments.

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(d) Assignments and Transfers by the Company. This Agreement may not be assigned
by the Company without the prior written consent of Investor, except that
without the prior written consent of the Investor, but after notice duly given,
the Company shall assign its rights and delegate its duties hereunder to any
successor-in-interest corporation, and such successor-in-interest shall assume
such rights and duties, in the event of a merger or consolidation of the Company
with or into another corporation or the sale of all or substantially all of the
Company’s assets.

(e) Benefits of the Agreement. The terms and conditions of this Agreement shall
inure to the benefit of and be binding upon the respective permitted successors
and assigns of the parties. Nothing in this Agreement, express or implied, is
intended to confer upon any party other than the parties hereto or their
respective successors and assigns any rights, remedies, obligations, or
liabilities under or by reason of this Agreement, except as expressly provided
in this Agreement.

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

(g) Titles and Subtitles. The titles and subtitles used in this Agreement are
used for convenience only and are not to be considered in construing or
interpreting this Agreement.

(h) Severability. If one or more provisions of this Agreement are held to be
unenforceable under applicable law, such provision shall be excluded from this
Agreement and the balance of this Agreement shall be interpreted as if such
provision were so excluded and shall be enforceable in accordance with its terms
to the fullest extent permitted by law.

(i) Further Assurances. The parties shall execute and deliver all such further
instruments and documents and take all such other actions as may reasonably be
required to carry out the transactions contemplated hereby and to evidence the
fulfillment of the agreements herein contained.

(j) Entire Agreement. This Agreement is intended by the parties as a final
expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein. This Agreement supersedes all prior
agreements and understandings between the parties with respect to such subject
matter.

(k) Applicable Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York without regard to principles
of conflicts of law.

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

The Company:
NEXMED, INC.
     
By:
/s/ Vivian Liu
 
Name:  Vivian Liu
 
Title:    President and CEO

 
The Investors:
THE TAIL WIND FUND LTD.
 
By:
TAIL WIND ADVISORY AND
   
MANAGEMENT LTD., as
   
investment manager
         
By:
/s/ David Crook
   
Name: David Crook
   
Title:   CEO

 

 
SOLOMON STRATEGIC HOLDINGS, INC.
     
By:
/s/ Andrew P. MacKellar
 
Name:  Andrew P. MacKellar
 
Title:    Director

 
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