LIMITED PARTNERSHIP AGREEMENT ("Agreement") dated the day of April,
2002, among PAR SVC, LLC, a New York limited liability company ("PAR"), SVC
PHARMA INC., a Delaware corporation ("SVC"), and UDF LP, a Delaware limited
partnership ("UDF"),

                              W I T N E S S E T H :
                              - - - - - - - - - -

            WHEREAS, SVC, PAR and UDF desire to form a limited partnership upon
the terms and conditions set forth herein;

            NOW, THEREFORE, it is agreed as follows:

            Section  1.  FORMATION.  SVC,  PAR and  UDF  hereby  form a  limited
partnership  (the  "Partnership")  pursuant to the  provisions  of the  Delaware
Revised Uniform Limited Partnership Act, as the same may be amended from time to
time (the "Delaware Act").

            Section 2. PARTNERS.

            (a)  GENERAL  PARTNER.  SVC  shall  be the  general  partner  of the
Partnership.

            (b) LIMITED  PARTNERS.  PAR and UDF shall be the limited partners of
the Partnership.

            (c)  DEFINED  TERMS.  SVC,  together  with any person or entity that
becomes a substituted or additional  general partner as provided  herein,  shall
sometimes be referred to herein as the "General  Partner," PAR and UDF, together
with any person or entity  that  becomes a  substituted  or  additional  limited
partner as provided herein,  shall sometimes be referred to herein individually,
as a "Limited  Partner," and  collectively,  as the "Limited  Partners," and the
General  Partner  and the  Limited  Partners  shall  sometimes  be  collectively
referred to herein as the "Partners."

<PAGE>


            Section 3. NAME. The business of the Partnership  shall be conducted
under the name SVC Pharma LP or such other name or names as the General  Partner
may determine.

            Section 4. PURPOSES.  The purpose of the Partnership is to research,
develop,  commercialize and market pharmaceutical preparations for human therapy
as from time to time determined by the General  Partner  through  subcontracting
arrangements  or  otherwise,  and any business  ancillary or incidental to or in
furtherance  of any  of the  foregoing  purpose,  and  such  other  business  or
businesses as the General Partner may, from time to time, determine to be in the
interests of the Partnership.

            Section 5. PLACE OF BUSINESS.  The Partnership may carry on business
at such  locations as may be  determined by the General  Partner.  The principal
office of the  Partnership  shall be located in Spring Valley,  New York or such
other place  within or outside the State of New York as the General  Partner may
determine.

            Section  6.  TERM.  The  Partnership  shall  begin  on  the  date  a
Certificate  of Limited  Partnership  is filed in the office of the Secretary of
State of the State of  Delaware,  and shall  continue  for a period of ten years
from the date of  initial  commercialization  of a product  to be  automatically
extended each year unless the Partners otherwise agree or unless the Partnership
is otherwise  dissolved in accordance with the provisions hereof or as otherwise
provided by law.


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<PAGE>


            Section 7. CAPITAL CONTRIBUTIONS.

            (a) AMOUNTS TO BE CONTRIBUTED.

                (i)   BY PAR. $9,900.00

                (ii)  BY UDF. $9,900.00

                (iii) BY SVC. $200.00

            (b)  LIABILITY  FOR CAPITAL  CONTRIBUTIONS.  Each  Partner  shall be
liable only for the making of the capital  contribution  set forth opposite such
Partner's  name in  Section  7(a)  hereof,  and  only  such  additional  capital
contribution as may be required pursuant to Section 8(a) hereof.

            (c) WITHDRAWAL OF CAPITAL CONTRIBUTIONS.  Except with the consent of
all the  Partners,  no Partner  shall  have the right to  withdraw  its  capital
contribution prior to dissolution and winding up of the Partnership  pursuant to
the terms of this Agreement.

            (d) INTEREST ON CAPITAL  CONTRIBUTIONS.  No interest shall accrue on
the initial or any subsequent contributions to the capital of the Partnership.

            (e) LOANS.  Loans, if any, by any Partner to the  Partnership  shall
not be considered capital contributions.

            Section 8. ADDITIONAL CAPITAL CONTRIBUTIONS; LIMITATION.

            (a)  ADDITIONAL  CAPITAL  AMOUNTS.  In the  event  that the  General
Partner  determines that additional  capital is required for the business of the
Partnership, each Partner hereby agrees to make additional capital contributions
from time to time,  as presented in Section  11(i),  in  accordance  with and as
limited  by  Section  8(b)  below,   in  the  aggregate   amount  so  determined
("Additional Capital Amount"). In the event that a Limited Partner fails to make


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<PAGE>

the additional capital contribution as provided in Section 11(i), the provisions
of Section 18(d) or 17(c), as applicable, shall control.

            (b)  PROPORTIONATE  CAPITAL  CONTRIBUTIONS.  The Additional  Capital
Amount  to be  contributed  by  each  Partner  shall  be  proportionate  to such
Partner's Percentage Interest (as defined in Section 9(a) below) ("Proportionate
Capital Contribution").

            Section 9. ALLOCATION OF PROFITS AND LOSSES.

            (a) PERCENTAGE INTERESTS. All items of income, gain, loss, deduction
and credit of the Partnership  shall be allocated among the Limited  Partners as
set forth below:

            SVC                          1.0%
            PAR                         49.5%
            UDF                         49.5%
                                       -----
                                       100.0%
                                       =====

The percentage set forth opposite a Partner's name above shall constitute such
Partner's percentage interest in the Partnership and is referred to herein as a
Partner's "Percentage Interest."

            (b) CAPITAL  ACCOUNTS.  Notwithstanding  any other provision of this
Agreement,  any allocation of income,  gain,  loss,  deduction and credit of the
Partnership  made hereunder  shall be made in such manner as will,  after giving
effect to such  allocation,  cause the Capital  Accounts  (as defined in Section
10(a)  below) of the  Partners  to be in the ratio of the  Partners'  percentage
interests.


                                       4
<PAGE>

            Section 10. CAPITAL ACCOUNTS; ALLOCATIONS AND DISTRIBUTIONS.

            (a) DEFINED.  As to any  Partner,  "Capital  Account"  shall mean an
account  maintained  by the General  Partner in  accordance  with Section  10(b)
below.

            (b) ESTABLISHMENT  AND  MAINTENANCE.   The   General  Partner  shall
establish  and maintain a Capital  Account for the  Partners.  Each such Capital
Account  shall  be  credited  with  (1) the  amount  of such  Partner's  Capital
Contributions  and  (2) the  amount  of Net  Income  allocated  to such  Partner
pursuant  hereto.  Each  such  Capital  Account  shall be  debited  with (i) any
property  distributed  to such  Partner,  (ii)  any cash  distributions  to such
Partner,  and  (iii)  the  amount  of Net Loss  allocated  to such  Partner.  In
determining  the balance of each Partner's  Capital  Account,  and for all other
purposes of this Agreement, the fair market value of any asset contributed to or
distributed by the Partnership  shall be determined in good faith by the General
Partner, except as specifically provided herein. Any license granted pursuant to
the Partnership by a Partner or an Affiliate of a Partner shall not be deemed an
asset   contributed  to  the  Partnership.   For  purposes  of  this  Agreement,
"Affiliate"  shall  mean in the case of PAR,  Par  Pharmaceutical,  Inc.,  a New
Jersey  corporation,  and in the case of UDF,  Rhodes  Technologies,  a Delaware
General Partnership.

            (c) DISTRIBUTIONS. Subject to Section 10(e), the distributions shall
be made to the  Partners  at times  and in  amounts  determined  by the  General
Partner;  PROVIDED that all  distributions  are made PRO RATA in accordance with
the  Percentage  Interests of the Partners.  Distributions  shall be made by the
General  Partner  to  the  Partners  as  provided  for  herein  of  all  amounts


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<PAGE>

contributed to the  Partnership by the Partners which are no longer  required to
fund the Annual Budget.

            (d) TAX DISTRIBUTIONS. Subject to Section 10(e) hereof:

                (i) If the aggregate  amounts  distributed to a Partner pursuant
            to Section  10(c) hereof for any Fiscal Year of the  Partnership  is
            less than the Estimated Tax Amount (as hereinafter  defined) of that
            Partner for such Fiscal Year, the General Partner, in its discretion
            may, and shall,  upon receipt of a written request from any Partner,
            cause the  Partnership to distribute  additional  amounts of cash to
            the Partners in proportion to their relative  allocations of taxable
            income,  until each Partner has received an amount of  distributions
            for such Fiscal Year equal to its Estimated Tax Amount. For purposes
            hereof,  Estimated Tax Amount shall mean,  with respect to a Limited
            Partner,  an amount of cash which in the good faith  judgment of the
            General Partner (e) equals the amount of taxable income allocable to
            such Limited  Partner in respect of such fiscal year  multiplied  by
            40%;  PROVIDED,   HOWEVER,   that,   notwithstanding  the  foregoing
            calculation,  distributions to each Limited Partner  hereunder shall
            be in an equal amount.

                (ii) The General  Partner  shall cause the  Partnership  to make
            distributions  in  accordance  with Section  10(d)(i)  hereof to the
            Partners  of their  Estimated  Tax Amounts for that period not later
            than the  thirtieth  (30th)  day  following  the close of the fiscal
            quarter.  The General  Partner  shall use its best efforts to ensure


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<PAGE>

            that the Estimated Tax Amounts  distributed  by the  Partnership  in
            accordance with Section  10(d)(i) hereof shall be distributed to the
            Partners  regardless of whether the  Partnership  otherwise has cash
            available  for this  purpose.  At the close of the Fiscal Year,  the
            General  Partner  shall  make  such  proper  adjustments  as  may be
            necessary  to the  character  and amounts of such  distributions  to
            reconcile the final  Estimated Tax Amounts of the Partners as of the
            close of the Fiscal Year with the  projected  Estimated  Tax Amounts
            previously  distributed  to the Partners with respect to such Fiscal
            Year.

            (e) NO DEFICIT  BALANCE.  Notwithstanding  the provisions of Section
10(c)  and  10(d),  the  General  Partner  shall  have the  right  to cause  the
Partnership  to reduce  or  withhold  distributions  to any  Partner  to avoid a
deficit balance in such Partner's Capital Account.

            (f) DISTRIBUTIONS UPON DISSOLUTION.  Notwithstanding  the provisions
of Section 10(c), upon dissolution the General Partner shall make  distributions
to the Partners in the manner specified in Section 18.

            (g) TAX  ELECTIONS.  All matters  concerning  the  allocation of tax
items among the Partners,  tax elections (except as otherwise required by income
tax laws) and accounting  procedures not expressly and specifically provided for
by the  terms  of this  Agreement  or the  Shareholder  Agreement  of even  date
herewith  between PAR SVC, LLC and Rhodes  Technologies  shall be  determined in
good  faith by the  General  Partner  on a basis  that is  equitable  among  the
Partners.


                                       7
<PAGE>

            (h) TAX MATTERS  PARTNER.  The General  Partner shall serve for each
taxable  year as the "Tax Matters  Partner" of the  Partnership  under  Internal
Revenue Code ("Code")  section  6231(a)(7) and section  301.6231(a)(7)-1  of the
Treasury  Regulations  promulgated under the Code  ("Regulations").  The General
Partner  shall  have  the  power  to  manage  and  control,  on  behalf  of  the
Partnership,  any  administrative  proceeding at the Partnership  level with the
Internal  Revenue  Service  relating  to  the   determination  of  any  item  of
Partnership  income,  gain,  loss,  deduction,  or credit for federal income tax
purposes.  In furtherance of the foregoing,  the General  Partner shall have all
the powers and  responsibilities  of such position  provided in the Code and (a)
shall promptly furnish the Internal Revenue Service with information  sufficient
to cause each Limited Partner to be treated as a "notice  partner" as defined in
Code  section  6231(a)(8),  (b) shall not file any  action or suit or extend any
statute of  limitations  relating  to  Partnership  tax  matters  without  first
notifying  each  Limited  Partner and  obtaining  the  unanimous  consent of all
Limited  Partners,  and (c) shall not  settle  any  action or suit  relating  to
Partnership  tax  matters  without  first  notifying  all Limited  Partners  and
obtaining the unanimous  consent of all Limited  Partners.  Reasonable  expenses
incurred by the General Partner,  in its capacity as such, will be treated as an
operating  expense of the Partnership  and part of the Annual Budget  hereunder.
Any Limited  Partner shall have the right to participate  in any  administrative
proceedings  relating  to the  determination  of  Partnership  tax  items at the
Partnership level.

            (i) TAX ELECTIONS. The General Partner may, in its sole and absolute
discretion,  make or revoke,  on behalf of the  Partnership,  such elections for
federal  income  tax  purposes  as are  permitted  to be made  under  the  Code,


                                       8
<PAGE>

including elections in accordance with Code section 754.

            (j) EFFECT OF CASH FLOW LOSSES. To the extent the Capital Account of
any Partner is depleted  by Cash Flow  losses,  such  Capital  Account  shall be
replenished from income of the Partnership  before any net income  distributions
are made to the Partners.  For the purposes of this Section  10(j),  "Cash Flow"
shall mean all net income of the Partnership as determined on the  Partnership's
books according to U.S. generally accepted accounting  principles,  plus (i) any
amortization charge taken on the books for the amortization of intangible assets
and (ii) depreciation, if any, taken on any assets including real property.

            Section 11. DUTIES AND OBLIGATIONS OF THE PARTNERS.

            (a) MANAGEMENT OF PARTNERSHIP  BUSINESS.  The General  Partner shall
have  sole  responsibility  for  managing  and  operating  the  business  of the
Partnership  and shall  exert its best  efforts  to  promote  the  Partnership's
success. In addition to any other rights and powers that the General Partner may
possess under this Agreement and the Delaware Act, the General  Partner,  in the
name and on behalf of the  Partnership,  shall,  except to the extent  otherwise
provided herein, have all specific rights and powers required for or appropriate
to the management of the Partnership's business.

            (b) FIDUCIARY DUTY OF GENERAL PARTNER.  The General Partner shall be
under a fiduciary  duty to conduct the  affairs of the  Partnership  in the best
interests  of the  Partnership  and  of  the  Limited  Partners,  including  the
safekeeping  of all  Partnership  funds and assets and the use  thereof  for the
exclusive benefit of the Partnership.


                                       9
<PAGE>

            (c) PROPOSALS AND PROJECTS.

                (i) The General  Partner  shall  consider  and review  proposals
            submitted  to  the  General  Partner  by a  Limited  Partner  or  an
            Affiliate (each, a "Proposal") to research,  develop,  commercialize
            and   market   pharmaceutical   preparations   for   human   therapy
            concentrating on  pharmaceutical  preparations  having the potential
            for  competitive  advantage  in the  marketplace  based upon  unique
            formulations  or dosage forms,  new or expanded  indications  and/or
            patentability  as to product,  process or use (each, a "Product" and
            collectively the "Products").  Each Proposal shall be in such format
            as  determined  by the General  Partner and shall include a proposed
            budget calculated to bring such Product successfully to market and a
            proposed  timeline for so doing. No Limited Partner or its Affiliate
            has any  obligation to present a Proposal to the General  Partner on
            behalf of the Partnership with respect to any particular Product.

                (ii) The General  Partner  shall approve or reject each Proposal
            within  a   reasonable   time   period,   based  upon  the  specific
            characteristics  and  circumstances  of  each  Proposal.   Upon  the
            approval of the General  Partner,  such Proposal (as may be modified
            by the General  Partner)  shall be  designated a "Project"  and such
            proposed budget (as may be modified by the General Partner) shall be
            designated the "Project  Budget." The Project Budget shall be funded
            by the  Partnership  pursuant to a capital  contributions  schedule,


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<PAGE>

            which generally shall require, unless the General Partner determines
            otherwise,  that  capital  contributions  in  respect  of the Annual
            Budget shall be made quarterly in advance and which shall  generally
            consist of an  initial  portion,  covering  start-up  and  projected
            research and  development  costs through the end of the then current
            Fiscal  Year,  and  subsequent  annual  portions  pursuant to annual
            budgets (each,  an "Annual Project  Budget")  developed each year by
            the  General  Partner,  as may be  amended  from time to time by the
            General  Partner in the event that it  determines  that such  Annual
            Project  Budget  shall be  insufficient  to fund the Project for the
            then-current  year. If the General Partner determines that a Project
            Budget  shall not be  sufficient  to bring  such  Project  to market
            successfully,   whether  due  to  cost   overruns,   adverse  market
            conditions,   unexpected  developments  or  otherwise,  the  General
            Partner  shall  decide  whether to increase  the  Project  Budget or
            terminate  the  Project on behalf of the  Partnership.  Any  Project
            Budget  (including any  modification by the General Partner) must be
            approved  by the  General  Partner  within  45 days  of the  General
            Partner's  determination  thereof  failing which such Project Budget
            and the Project  associated  therewith  shall be deemed  rejected on
            behalf of the Partnership. Each Project Budget and each amendment or
            modification   thereto   shall  be  supported   with  detailed  cost
            worksheets.

            (d) PROJECT DEVELOPMENT.  The General Partner shall use commercially
reasonable  efforts to have a Project  developed on behalf of the Partnership in
accordance with the  requirements of applicable law in such order of priority as


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<PAGE>

is determined by the General  Partner.  The Limited  Partners  acknowledge  that
there is no  guaranty  or  warranty  of the  General  Partner  on  behalf of the
Partnership  that  development  of any Product will be commenced or continued or
successfully completed within any specific time period, if at all.

            (e) PROJECT  SUBCONTRACTING.  On a case-by-case  basis,  the General
Partner  shall  decide  where  to   subcontract   the   research,   development,
commercializing and/or marketing of a Project to an outside party,  preferably a
Limited Partner or an Affiliate;  PROVIDED,  HOWEVER, that (i) any subcontractor
(including a Limited  Partner or an Affiliate) that market,  sells,  distributes
and  collects  receipts  from sales of any Product  shall be required to pay its
gross profit (as  determined in accordance  with Exhibit A attached  hereto) for
such Product to the Partnership,  except as otherwise  determined by the General
Partner,  (ii) any Limited Partner or Affiliate that performs research on behalf
of the Partnership shall be reimbursed for its research and development costs as
determined  in  accordance  with  Exhibit  B, (iii) any  subcontractor  shall be
required to indemnify the Partnership in accordance with the terms prescribed by
the  General  Partner,  (iv) any  subcontractor  shall be  required  to purchase
products  liability  insurance  in such  amount  as the  General  Partner  shall
determine,  (v) any subcontractor  shall be required to comply with Current Good
Manufacturing Practices (as hereinafter defined), and any material noncompliance
with Current Good Manufacturing  Practices by any subcontractor  shall result in
termination  of such  Person  as a  subcontractor,  and (vi) any  Person  who is
debarred,   or  whose  affiliate  is  debarred,   by  the  U.S.  Food  and  Drug
Administration  or U.S.  Defense  Logistics Agency  ("Debarment"),  shall not be


                                       12
<PAGE>

engaged  as  a  subcontractor   hereunder,   and  any  existing   subcontracting
arrangement with such Person shall automatically  terminate upon such Debarment.
"Current Good  Manufacturing  Practices"  shall mean current good  manufacturing
practices for the methods used in, and the facilities and controls used for, the
manufacture,  processing, packaging and holding of the Product, all as set forth
from time to time by the FDA pursuant to the Federal  Food,  Drug,  and Cosmetic
Act, as amended  from time to time,  and the rules and  regulations  promulgated
thereunder (including  specifically,  Title 21, parts 210 and 211 of the Code of
Federal  Regulations of the United States). In the event a Limited Partner or an
Affiliate is a subcontractor to the Partnership with respect to a Project,  such
Limited   Partner's  or  Affiliate's   compensation  for  its  services  to  the
Partnership on any Project shall be such amount approved by the General Partner.
Where commercially reasonable, the General Partner will subcontract the Project,
including  primary  Product  development,  research  and  development  of active
pharmaceutical  ingredients,   drug  formulation  and/or  chemical  composition,
product approval and registration, bulk manufacturing, manufacturing of finished
dosage form, marketing,  distribution and sales, financial management, and legal
compliance among the Limited Partners or their  Affiliates.  The General Partner
shall have full and final authority over the  distribution  of  responsibilities
for each Project as it deems  appropriate  and  desirable  for the  Partnership.
Where any  portion  of a Project  is  subcontracted  to a Limited  Partner or an
Affiliate, (x) the role played by such party shall be that of a subcontractor to
the  Partnership,  and such party shall carry out its duties in accordance  with
the mandate of the General  Partner;  and (y) such party's  compensation for its


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<PAGE>

services  to the  Partnership  on such  Project  shall  be the  amount  approved
therefor  by the  General  Partner.  In the event  that a Limited  Partner or an
Affiliate  exceeds the amount  approved by the General  Partner  with respect to
such party's  undertaking  as a  subcontractor,  such excess amount shall not be
reimbursed  by the  Partnership  unless  such  reimbursement  is approved by the
General Partner.

            (f)  PROGRESS  REPORTS.  The  General  Partner  shall  require  each
subcontractor  under each Project to report on the progress of such Project on a
periodic basis as determined by the General  Partner.  The General Partner shall
monitor the  progress  of each  Project  and  apprise  the  Partnership  of such
progress on a periodic basis as determined by the General  Partner.  The General
Partner shall  promptly  report to the Partners any  significant  changes to the
progress of a Project or its projected cost, schedule, or likelihood of success.

            (g)  DUE  ANALYSIS.   In  a  Limited  Partner's  or  an  Affiliate's
consideration of a Proposal intended to be submitted to the General Partner, the
Limited Partner  considering  such submission  agrees to undertake and agrees to
cause its  Affiliate to undertake  such  analyses  with respect to the potential
commercial  viability  of the Product or Products  part  thereof as such Limited
Partner  or  Affiliate  employs  in  determining  whether  or not to pursue  the
development of products within its own organization.

            (h) GROSS PROFIT PAYMENT. Payment to the Partnership of Gross Profit
required  under Section 11(c) hereof shall be made within  forty-five  (45) days
following the  conclusion of the calendar month in which the sale of the Product
occurred.


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<PAGE>

            (i) ANNUAL BUDGET. Each year during the term of this Agreement,  the
General  Partner shall develop and approve an annual  operating  budget covering
general  operations  for the upcoming year and  incorporating,  as separate line
items,  each Annual  Project  Budget  (together,  the "Annual  Budget").  If the
General Partner determines that an Annual Budget shall not be sufficient to fund
the  Partnership's  obligations  for  the  current  year,  whether  due to  cost
overruns,  adverse market conditions,  unexpected developments or otherwise, the
Annual Budget may be amended by the General  Partner and upon such amendment the
General Partner shall provide each Partner with written notice of any additional
capital  contribution  due from such  Partner  pursuant  to the  amended  Annual
Budget,  together with an explanation of such increase.  Each Partner shall make
an additional  capital  contribution  to the  Partnership in accordance with its
Percentage interest to fund the Annual Budget.

            (j)  DELIVERY OF FINANCIAL  STATEMENTS.  The General  Partner  shall
deliver to the  Partners  financial  statements  of the  Partnership  as soon as
practicable after the end of each fiscal year.

            (k)  PARTNERSHIP  TAX RETURNS.  The General  Partner shall cause the
preparation  and timely  filing of all the  Partnership's  tax returns and shall
promptly deliver copies thereof to the Partners.

            (l) LIMITATION ON ACTIONS OF LIMITED PARTNERS.  The Limited Partners
shall not  participate  in the control of the  Partnership  business or have the
authority or right to act for or bind the Partnership.


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<PAGE>

            (m) PERMITTED ACTIONS BY LIMITED PARTNERS.  The Limited Partners are
hereby  entitled to possess or exercise one or more of the  following  powers or
act in one or more of the  following  capacities  and,  in  accordance  with ss.
17-303 of the Delaware  Act, any such  possession,  exercise or action shall not
constitute  participation in the control of the Partnership  business within the
meaning of the Delaware Act:

                (i) To be an independent  contractor for or to transact business
            with,  including  being  a  contractor  for,  or to be an  agent  or
            employee  of,  the  Partnership  or a General  Partner,  or to be an
            officer,  director or stockholder of a corporate General Partner, or
            to be a limited  partner of a partnership  that is a General Partner
            of the  Partnership,  or to be a trustee,  administrator,  executor,
            custodian or other  fiduciary or  beneficiary  of an estate or trust
            which is a General Partner,  or to be a trustee,  officer,  advisor,
            stockholder  or  beneficiary  of a business trust which is a General
            Partner, or to be a member,  manager, agent or employee of a limited
            liability company which is a general partner;

                (ii) To  consult  with or advise a General  Partner or any other
            person with  respect to any matter,  including  the  business of the
            Partnership,  or to act or  cause a  General  Partner  or any  other
            person to take or refrain  from  taking  any  action,  including  by
            proposing,  approving,  consenting  or  disapproving,  by  voting or
            otherwise, with respect to any matter, including the business of the
            Partnership;


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<PAGE>

                (iii)  To  act  as  surety,   guarantor   or  endorser  for  the
            Partnership or a General Partner,  to guaranty or assume one or more
            obligations of the Partnership or a General Partner, to borrow money
            from the  Partnership  or a General  Partner,  to lend  money to the
            Partnership or a General Partner,  or to provide  collateral for the
            Partnership or a General Partner;

                (iv) To call, request, attend or participate at a meeting of the
            Partners or the Limited Partners;

                (v) To wind up the  Partnership  pursuant  to ss.  17-803 of the
            Delaware Act;

                (vi) To take any action  required or  permitted by law to bring,
            pursue or settle or otherwise  terminate a derivative  action in the
            right of the Partnership;

                (vii) To serve on a committee of the  Partnership or the Limited
            Partners or Partners or to appoint,  elect or otherwise  participate
            in the choice of a representative  or another person to serve on any
            such  committee,  and to  act as a  member  of  any  such  committee
            directly or by or through any such representative or other person;

                (viii) To act or cause the taking or refraining  from the taking
            of any action,  including by  proposing,  approving,  consenting  or
            disapproving, by voting or otherwise, with respect to one or more of
            the following matters:


                                       17
<PAGE>

                    (A) The  dissolution and winding up of the Partnership or an
                election to continue the  Partnership or an election to continue
                the business of the Partnership;


                    (B) The sale, exchange, lease, mortgage,  assignment, pledge
                or other transfer of, or granting of a security interest in, any
                asset or assets of the Partnership;

                    (C) The incurrence, renewal, refinancing or payment or other
                discharge of indebtedness by the Partnership;

                    (D)  A  change  in  the  nature  of  the   business  of  the
                Partnership;

                    (E)  The  admission,  removal  or  retention  of  a  General
                Partner;

                    (F)  The  admission,  removal  or  retention  of  a  Limited
                Partner;

                    (G) A  transaction  or other  matter  involving an actual or
                potential conflict of interest;

                    (H) An  amendment  to this  Agreement  or the  Partnership's
                Certificate of Limited Partnership;


                                       18
<PAGE>

                    (I) The merger or consolidation of the Partnership;

                    (J) The indemnification of any Partner or other person;

                    (K) The making of, or  calling  for,  or the making of other
                determinations in connection with contributions;

                    (L) The making of, or the making of other  determinations in
                connection   with   or   concerning,    investments,   including
                investments in property, whether real, personal or mixed, either
                directly or indirectly, by the Partnership; or

                    (M) Such other matters as are stated in this Agreement or in
                any other agreement or in writing;

                (ix) To serve on the board of  directors  or a committee  of, to
            consult  with or advise,  to be an officer,  director,  stockholder,
            partner  (other than a general  partner of a General  Partner of the
            Partnership),  member, manager, trustee, agent or employee of, or to
            be  a  fiduciary  or  contractor   for,  any  person  in  which  the
            Partnership  has an  interest  or any person  providing  management,
            consulting,  advisory, custody or other services or products for, to
            or  on  behalf  of,  or   otherwise   having  a  business  or  other
            relationship  with,  the  Partnership  or a General  Partner  of the
            Partnership; or


                                       19
<PAGE>

(x)         Any right or power granted or permitted to the Limited Partners
            under the Delaware Act and not specifically enumerated in this
            Section 11(f).

            (n) OTHER ACTIONS BY LIMITED PARTNERS NOT CONSTITUTING  CONTROL. The
enumeration  in Section  11(m) does not mean that the  possession or exercise of
any other powers or having or acting in other  capacities  by a Limited  Partner
constitutes  participation  by  it  in  the  control  of  the  business  of  the
Partnership.

            (o) CONSENT OF LIMITED PARTNERS. The Limited Partners hereby consent
to the  exercise by the General  Partner of the powers  conferred on the General
Partner by this  Agreement.

            Section 12. RESTRICTIONS ON THE AUTHORITY OF THE GENERAL PARTNER.

            (a) LIMITATIONS ON ACTIONS OF GENERAL PARTNER.  The General Partner,
in its conduct and  management  of the business and affairs of the  Partnership,
shall have all the powers conferred by the Delaware Act on general partners of a
limited partnership;  PROVIDED, HOWEVER, that the General Partner shall not take
any of the following actions:

                (i) Do any act in contravention of this Agreement or which would
            make  it  impossible  to  carry  on  the  ordinary  business  of the
            Partnership; or

                (ii) Admit any person or entity as an  additional  or substitute
            General Partner or as an additional or substitute  Limited  Partner,
            except as otherwise provided herein.


                                       20
<PAGE>

            (b)  ACTIONS  REQUIRING  CONSENT OF LIMITED  PARTNERS.  The  General
Partner shall not, without the consent of each of the Limited Partners, take any
of the following actions:

                (i) Mortgage, assign or otherwise encumber its interest, if any,
            in the Partnership; or

                (ii) Extend the term of the Partnership.

            Section 13. LIMITED PARTNERS' LIABILITIES.

            (a) NO LIABILITY FOR  LIABILITIES OF GENERAL PARTNER OR PARTNERSHIP.
The Limited  Partners  shall not be liable for the debts or  liabilities  of the
General Partner or the Partnership.

            (b) LIMITATION ON LIABILITY FOR DISTRIBUTIONS. A Limited Partner who
receives a distribution  from the Partnership  shall have no liability under the
Delaware Act or other  applicable law for the amount of the  distribution  after
the expiration of three years from the date of distribution.

            Section 14.  DISABILITY  OF THE LIMITED  PARTNERS;  ASSIGNMENT BY OR
SUBSTITUTION OF LIMITED PARTNER. (

            a)  RIGHT  TO  CONTINUE  BUSINESS.   Upon  the  death,   bankruptcy,
dissolution or liquidation  and  termination of a Limited Partner (the "Affected
Limited  Partner"),  the remaining Partners shall have the right to continue the
business  of the  Partnership;  PROVIDED,  HOWEVER,  that  upon  such  event the
administrator,  committee, trustee or other legal representative or successor in
interest  of the  Affected  Limited  Partner  shall  have all of the  rights and


                                       21
<PAGE>

liabilities of the Affected  Limited Partner as are necessary for the purpose of
settling or managing the estate or the affairs of the Affected Limited Partner.

            (b)  RIGHT  TO  ASSIGN   PARTNERSHIP   INTEREST.   Subject   to  the
restrictions  on  transferability  contained  in Section 20 below,  the Affected
Limited  Partner  (or its  administrator,  committee,  trustee  or  other  legal
representative  or  successor  in  interest)  shall have the right to assign its
interest in the Partnership or to appoint such assignee as a substitute  Limited
Partner  with  respect to that  interest.  The General  Partner  shall make such
amendments  to this  Agreement  and the  Partnership's  Certificate  of  Limited
Partnership,  and file  and  record  such  amendments  and  other  documents  or
instruments necessary to reflect such substitution.

            Section 15. REMOVAL OF THE GENERAL PARTNER.

            (a) RIGHT TO REMOVE  GENERAL  PARTNER.  The Limited  Partners,  upon
unanimous  consent,  shall have the right,  exercisable by written notice to the
General Partner,  to remove the General Partner and appoint a substitute General
Partner.

            (b)  TERMINATION  OF  PARTNERSHIP  INTEREST.   The  removed  General
Partner's Partnership Interest shall be terminated upon the date of such removal
but  it  shall  be  entitled  to  receive  the  distributions,   fees  or  other
compensation then due to it pursuant to this Agreement or otherwise.

            (c) LIMITATION ON PERSONAL  LIABILITY.  The exercise of the right of
removal  granted in this  Agreement or the removal of the General  Partner shall
not in any way impose any personal  liability on the Limited  Partners or render
the Limited Partners general  partners.  If the General Partner is removed and a
substitute General Partner is appointed,  then,  immediately upon the removal of


                                       22
<PAGE>

the General  Partner,  the Partners,  including the substitute  General Partner,
shall amend the Partnership's  Certificate of Limited Partnership and shall take
or cause to be taken all filings and steps required in connection therewith, all
in accordance with the Delaware Act or other applicable law.

            Section 16. ADMISSION OF AN ADDITIONAL  GENERAL PARTNER.  Any person
or entity shall be admitted as an additional  General Partner upon the unanimous
written  consent of the Partners.  Upon any such event,  there shall be promptly
filed and caused to be recorded an  appropriate  amendment of the  Partnership's
Certificate of Limited Partnership.

            Section 17. EVENTS CAUSING DISSOLUTION.  The happening of any one or
more of the following events shall cause a dissolution of the Partnership:

            (a) WITHDRAWAL OF GENERAL PARTNER. The removal,  death,  bankruptcy,
dissolution or liquidation and termination of the General Partner or other event
of  withdrawal  of the General  Partner  which under the Delaware Act causes the
dissolution of the Partnership,  unless either (i) at the time of any such event
there is at least one other  General  Partner,  in which  event the  Partnership
business may be carried on by the remaining  General Partner or (ii) if there is
no other General Partner,  all the remaining Partners,  within 90 days after any
such event, (x) agree in writing to continue the business of the Partnership and
(y) appoint  effective  as of the date of any such event a  substituted  General
Partner; or

            (b)  AGREEMENT TO DISSOLVE.  An agreement to dissolve by the Limited
Partners.


                                       23
<PAGE>

            (c)  Any  failure  by  a  Partner  to  make  an  Additional  Capital
Contribution as provided for in Section 8 hereof and (i) such failure  continues
for a period of 45 days of the written notice of such failure by another Partner
and (ii) such failure is not subject to the provisions of Section 18(d) hereof.

Section 18. CERTAIN CONTINGENCIES; LIQUIDATION.

            (a) LIQUIDATING AGENT. Upon the dissolution of the Partnership,  the
Partnership  shall be  liquidated  in  accordance  with this  Agreement  and the
Delaware Act. The  liquidation  shall be conducted and supervised by the General
Partner or, if there is no General Partner,  by a person who shall be designated
for such purpose by the Limited  Partners (the General Partner or such person so
designated being herein referred to as the "Liquidating Agent"). The Liquidating
Agent  shall have all of the rights  and powers  with  respect to the assets and
liabilities  of  the   Partnership  in  connection   with  the  liquidation  and
termination of the Partnership  that the General Partner has with respect to the
assets and  liabilities of the Partnership  during the term of the  Partnership,
and the  Liquidating  Agent is hereby  expressly  authorized  and  empowered  to
execute  any  and  all  documents  necessary  or  desirable  to  effectuate  the
liquidation  and termination of the Partnership and the transfer of any asset or
liability of the  Partnership.  The Liquidating  Agent shall have the right from
time to time,  by  revocable  powers of  attorney,  to  delegate  to one or more
persons or  entities  any or all such rights and powers and such  authority  and
power to execute documents,  and, in connection therewith, to fix the reasonable
compensation of each such person or entity,  which compensation shall be charged
as an expense of liquidation.


                                       24
<PAGE>

            (b) LIQUIDATION PROCEDURE. Upon dissolution of the Partnership,  the
Partnership shall be wound up and liquidated in accordance with the Delaware Act
and the following provisions:

                (i) Any  gain or  loss  realized  on  liquidating  sales  of the
            Partnership's  assets, and all income,  gain,  deduction or loss for
            the taxable  year (or  fraction  thereof) in which such  liquidation
            occurs,  shall be credited or charged to the Capital Accounts of the
            Partners  in  accordance  with  Section  9  hereof  and the  Capital
            Accounts of the  Partners  shall be further  adjusted to reflect the
            manner in which  any  unrealized  income,  gain,  loss or  deduction
            inherent  in any  Partnership  property  to be  distributed  in kind
            (which has not previously been reflected in Capital  Accounts) would
            be allocated among the Partners if there were a taxable  disposition
            of such  property  for its  fair  market  value  on the date of such
            distribution.

                (ii) Each Partner shall pay to the  Partnership all amounts owed
            by such Partner to the Partnership.

                (iii)  The  assets  of the  Partnership,  including  any  monies
            received  pursuant to Section  18(b)(ii) above,  shall be applied in
            the  following  order:

            FIRST,  to the payment of creditors of the  Partnership,  other than
the Partners.


                                       25
<PAGE>

            SECOND,  to the  establishment  of any reserves that the Liquidating
Agent, acting pursuant to this Agreement, in accordance with reasonable business
judgment,  deems reasonably necessary to provide for the payment when due of any
contingent or unforeseen  liabilities or obligations of the  Partnership  (which
reserves may be paid over by the Liquidating  Agent to a trustee or escrow agent
for purposes of (A) distributing such reserves in payment of the  aforementioned
contingencies,  and (B)  distributing the balance of such reserves in the manner
provided herein).

            THIRD,  to the  payment of  liabilities  of the  Partnership  to the
Partners.

            FOURTH,  to the Partners in  proportion  to their  positive  Capital
Accounts,  if any,  in an amount as will bring each  Limited  Partner's  Capital
Account  to zero and then to each  Partner  in  accordance  with its  Percentage
Interest.

            The  choice  of  which,  if  any,   Partnership  assets  are  to  be
distributed  among the Limited  Partners shall be within the sole  discretion of
the Liquidating  Agent and shall be binding upon all Partners.  If assets are to
be distributed in kind, the Liquidating Agent may, in its discretion, distribute
such assets to the Limited  Partners PRO RATA in accordance  with each Partner's
Percentage Interest,  or cause, prior to distribution,  the value of such assets
to be determined by an independent  appraiser  chosen by the Liquidating  Agent.
Such value, as so determined, shall be binding upon all Limited Partners.

            (c)  CONTINUATION OF PRODUCT SALES. In the event that on the date of
dissolution a Product or Products is being  commercialized  by the  Partnership,
the  General   Partner  or  the   Liquidating   Agent,   as  applicable,   shall
notwithstanding any provision to the contrary herein take reasonable  commercial
efforts  to  the  end  that  the  Product  or  Products  shall  continue  to  be


                                       26
<PAGE>

commercialized for the ten (10) year period following  dissolution on such basis
that each Limited Partner shall receive on a quarterly basis fifty percent (50%)
of the Gross Profit  derived from the continued  commercialization  of same. The
Partners may upon  unanimous  agreement  elect to continue the marketing of such
Products after the  conclusion of the ten (10) year period  provided for herein,
failing which,  the marketing of such Products shall cease.  Any license granted
by a Limited  Partner or an  Affiliate  to the  Partnership  and required by the
other Limited  Partner or its Affiliate for the continued  commercialization  of
any  Products  shall  remain in  effect  for the ten (10)  year  period  (or any
extension thereof) provided for herein.

            (d) WITHDRAWAL  FROM A PROJECT.  In the event a Limited Partner does
not  contribute  its  entire  share of an  additional  capital  contribution  as
provided for in Section  11(i) hereof  within the  timeframe  determined  by the
General  Partner in  accordance  with the  provisions  hereof  and such  Limited
Partner  fails to remedy  such  failure  within  thirty  (30) days of receipt of
written  notice  thereof by the other  Limited  Partner,  unless such failure is
through no fault of such  Limited  Partner,  then the  non-contributing  Limited
Partner shall immediately  provide notice to the other Partners  identifying the
specific  Project and line item Annual Project Budget with respect to which such
Limited Partner is withholding its additional capital contribution. In the event
that PAR is the  non-contributing  Limited Partner, PAR agrees that (i) that the
Project so identified shall cease to be a Project of the  Partnership,  (ii) UDF
shall be free to pursue the Product  underlying  such  Project,  (iii) PAR shall
license or cause to be licensed  to UDF any  intellectual  property  the subject
matter  of  which  was or  was to be  licensed  by PAR or its  Affiliate  to the


                                       27
<PAGE>

Partnership  in connection  with the Project on the same terms and conditions as
such  intellectual  property  was  licensed  to or  was  to be  licensed  to the
Partnership and (iv) PAR shall continue to perform, at UDF's expense,  under any
contract  granted to PAR or its Affiliate by the Partnership with respect to the
Project on terms and conditions  substantially  similar to those provided for in
the contract with the Partnership. In the event that UDF is the non-contributing
Limited Partner, UDF agrees that (i) the Project as identified shall cease to be
a Project  of the  Partnership,  (ii) PAR shall be free to  pursue  the  Project
underlying such Product,  (iii) UDF shall license or cause to be licensed to PAR
any intellectual  property the subject matter of which was or was to be licensed
by UDF or its Affiliate to the Partnership in connection with the Project on the
same terms and conditions as such  intellectual  property was licensed to or was
to be licensed to the  Partnership  and (iv) UDF shall  continue to perform,  at
PAR's  expense,  under  any  contract  granted  to UDF or its  Affiliate  by the
Partnership  with respect to the Project on terms and  conditions  substantially
similar to these provided for in the contract with the Partnership.

            Section 19. MEETINGS OF PARTNERS.

            (a) NOTICE OF  MEETING;  QUORUM.  Any Partner may at any time call a
meeting of Partners.  Notice of any meeting of Partners  shall be mailed to each
Partner at least 15 and not more than 30 business  days prior to the date of the
meeting unless all of the Partners consent to a shorter notice period.  Meetings
will be held at such time and  place as shall be agreed to by all the  Partners.
Partners  constituting 100% in Percentage Interest present in person or by proxy
throughout the meeting shall constitute a quorum for the transaction of business
at  any  meeting.  All  Partners,   officers  and  directors  of  Partners,  the


                                       28
<PAGE>

Partnership's  auditors and their respective counsel may attend and speak at any
meeting of the  Partners.

            (b) VOTING. A quorum being present,  each question  presented to any
meeting of the Partners  shall be decided by the unanimous vote of the Partners.
Any  question  may be decided by the consent in writing by all of the  Partners.
Any  question  so  decided  shall  be  binding  on all the  Partners  and  their
respective  heirs,  executors,  administrators,   successors  and  assigns.  All
proceedings  and  decisions at meetings of Partners and all written  consents of
Partners  shall be  recorded  in a minute  book  which  shall be  available  for
inspection  by  the  Partners  at  the  principal   place  of  business  of  the
Partnership.

            Section 20.  TRANSFERS OR  DISPOSITIONS  OF  PARTNERSHIP  INTERESTS;
WITHDRAWAL OF A LIMITED PARTNER.

            (a)  DEFINITION  OF  "SPECIFIED  PERSON".   "Specified  Person"  for
purposes of this Agreement shall mean either:

                (i) with respect to PAR, its  permitted  successors  and assigns
            shall  mean any  individual,  corporation  or  partnership  (whether
            limited or general), limited liability company, association, nominee
            or any other  individual or entity in its own or any  representative
            capacity which directly or indirectly controls,  is controlled by or
            is under common  control  with PAR.  For  purposes of the  foregoing
            sentence,  "Control"  shall mean an equity or income interest of 50%
            or more in, or the possession,  directly or indirectly, of the power
            to cause  the  direction  and  management  of any  person  or entity


                                       29
<PAGE>

            described  in the  first  sentence  of this  Section  20(i)  whether
            through  the   ownership  of  voting   securities   by  contract  or
            declaration of trust, or otherwise.

                (ii) with respect to UDF, its permitted  successors  and assigns
            shall  mean  any  person,  individual,  corporation  or  partnership
            (whether   limited   or   general),   limited   liability   company,
            association, nominee or any other individual or entity in its own or
            any representative  capacity which directly or indirectly  controls,
            is controlled  by or is under common  control with UDF. For purposes
            of the  foregoing  sentence,  control shall mean an equity or income
            interest of 50% or more in, or the power,  directly or indirectly to
            cause the direction and management of any person or entity described
            in the first sentence of this Section 20(ii).

            (b)  LIMITATION ON DISPOSITION  OF PERCENTAGE  INTEREST.  No Partner
will directly or indirectly sell, offer for sale, or entertain an offer (whether
solicited or unsolicited),  transfer,  pledge or otherwise dispose of any of its
Percentage  Interest in the  Partnership,  except to a Specified  Person of such
Partner, without the agreement of the other Partners.

            (c)  RULES  OF  CONSTRUCTION.  For  purposes  of  the  construction,
interpretation  and  enforcement  of this  Section  20,  it is  agreed  that the
disposition  by a  Limited  Partner  of  all or any  portion  of its  Percentage
Interest  shall be deemed  analogous to a disposition  by a  shareholder  of the
shares of common stock of a corporation organized under the laws of the State of
New York  ("New  York  Shares")  and that this  Section  20 shall be  construed,


                                       30
<PAGE>

interpreted and enforced in accordance with the laws of the State of New York as
such laws relate to a disposition  of New York Shares  without  giving effect to
any principles of conflict of laws which would otherwise  render the laws of New
York inapplicable to such disposition.

            (d)  WITHDRAWAL  OF  LIMITED  PARTNER.  A  Limited  Partner  may not
withdraw from the  Partnership  prior to the  dissolution  and winding up of the
Partnership, subject to the provisions contained in Section 20(a) and (b).

            Section 21. CONFIDENTIALITY.

            (a)  CONFIDENTIAL  NATURE OF  AGREEMENT.  Each Partner  agrees that,
without the prior  written  consent of the other  Partners,  or except as may be
required by law or court order,  the existence and terms of this Agreement shall
remain  confidential  and shall not be  disclosed  to any Person  other than (i)
employees  and  professional  advisers  of such  Partner  or its  Affiliate  who
reasonably require knowledge of the existence or terms of this Agreement and who
are  bound  to  such  Partner  or  its   Affiliate  by  a  like   obligation  of
confidentiality and (ii) governmental agencies where such disclosure is required
by or advisable  under  applicable law. Each Partner shall advise its Affiliate,
employees  and  advisors  of the nature  and  existence  of the  confidentiality
undertakings of this Agreement and of the  applicability of such undertakings to
them and shall have such  Affiliate,  employees  and advisors  agree to be bound
hereby.

            (b) DUTY OF  CONFIDENTIALITY.  Each Partner  agrees to hold in trust
and confidence  (and to cause its Affiliate to hold in trust and confidence) for
the  benefit  of  the  other  Partner  (and  its  Affiliate)  all   Confidential
Information (as hereinafter defined) of such other Partner and its Affiliate and


                                       31
<PAGE>

each further agrees to safeguard,  and to cause its Affiliate to safeguard,  the
Confidential  Information  of the other  Partner (or its  Affiliate) to the same
extent  that it does  with its own  confidential  information  and to limit  and
control  copies,   extracts  and   reproductions   made  of  such   Confidential
Information.  No Partner will, without the express written consent of the other,
directly or  indirectly,  use (or  authorize,  permit or suffer its Affiliate to
use) any  Confidential  Information of the other Partner or of its Affiliate for
any  purpose  other than to  implement  the  provisions  of this  Agreement,  in
regulatory  proceedings,  in litigation,  or where  disclosure to a governmental
agency is required by or advisable under  applicable law. Except as set forth in
the preceding sentence, no Partner will disclose Confidential Information to any
Person,  other  than  its  employees  or other  representatives  or those of its
Affiliate who have a need to know to fulfill the  provisions  and intent of this
Agreement (where such provisions and intent cannot property be fulfilled without
such  disclosure) and who have been informed of the  confidential  nature of the
information and have agreed to be bound by the terms hereof.  Each Partner shall
use  its  best  efforts  to  prevent  unauthorized  use  or  disclosure  of  the
Confidential  Information  of the other  Partner or its  Affiliate and shall use
protective  measures no less stringent than those used by it in its own business
to  protect  its  own  confidential  information,   including  segregating  such
information  at all  times  from the  confidential  material  of others so as to
prevent any commingling.

            (c)  COMPULSORY  DISCLOSURES.  In the event that any Partner (or its
Affiliate)  shall be  legally  compelled  or  required  by a court of  competent
jurisdiction  to disclose  all or any part of the  Confidential  Information  of
another Partner (or its Affiliate),  it shall provide prompt notice to the other


                                       32
<PAGE>

so that such other Partner (or its  Affiliate)  may determine  whether or not to
seek a protective order or any other  appropriate  remedy. If a protective order
or other appropriate  remedy is not obtained before such disclosure is required,
the Partner required to make disclosure will disclose only those portions of the
Confidential  Information in question which it is advised by written  opinion of
counsel  (which  opinion  shall be  addressed  to such  Partner and to the other
Partner),  it is legally required to disclose and will exercise its best efforts
to obtain reliable assurances that confidential  treatment will be accorded such
Confidential Information.

            (d) RETURN OF  CONFIDENTIAL  INFORMATION.  Upon  dissolution  of the
Partnership  pursuant hereto,  each Partner shall, except as may be required for
the  continued  commercialization  of  Product(s)  pursuant  to  Section  18(c),
immediately return to the other Partner all material containing or reflecting or
referring to any  Confidential  Information of another  Partner or its Affiliate
(including all notes, summaries, analysis or other documents prepared or derived
therefrom)  and all  copies  thereof in any form  whatsoever  under the power or
control of such Partner or its  Affiliate,  except that one copy may be retained
for legal  archival  purposes,  and such Partner shall delete such  Confidential
Information  from all  retrieval  systems  and data  bases  or  destroy  same as
directed by the other Partner and furnish to the other Partner, if requested,  a
certificate  of a  senior  officer  of such  Partner,  certifying  such  return,
deletion  and/or  destruction.  Where  only  a  particular  Product/Products  or
Project/Projects  is  terminated  by  the  General  Partner  on  behalf  of  the
Partnership  in accordance  with Section 18(d),  then the foregoing  obligations


                                       33
<PAGE>

shall   thereupon   apply  to   Confidential   Information   relating   to  such
Product/Products or Project/Projects.

            (e) SURVIVAL.  The obligations of each Partner under this Section 21
shall survive termination of this Agreement and shall continue in full force and
effect for a period of three (3) years following any such termination.


            (f)   DEFINITION   OF   CONFIDENTIAL   INFORMATION.    "Confidential
Information"  shall mean information of a Partner or its Affiliate  disclosed to
or obtained by another Partner or its Affiliate (including  information obtained
by one  Partner  or its  Affiliate  as a result of access to the  facilities  of
another  Partner or its  Affiliate or as a result of its  relationship  with the
other Partner or its Affiliate in connection with this  Agreement)  either prior
to or during the term of this  Agreement  that is  non-public,  confidential  or
proprietary in nature (including,  without limitation,  trade secrets, financial
data,  product  information,   manufacturing  methods,   market  research  data,
marketing plans,  identity of customers,  or product information  (including the
nature  and  source  of  raw  materials,  product  formulation  and  methods  of
producing,  testing and packaging)) and which relates to the disclosing  party's
past,   present  or  future  research,   development  or  business   activities.
Confidential  Information shall not, however,  include  information that a party
can demonstrate by written evidence:

                (i) is in the public domain  (provided  that  information in the
            public  domain has not and does not come into the public domain as a
            result  of a breach  by a party  hereto  (or its  Affiliate)  of its
            obligations of confidentiality contained herein;


                                       34
<PAGE>

                (ii) is known by the receiving  party prior to disclosure by the
            other  party  as  shown  by  documentation  of the  receiving  party
            existing on the date of such disclosure sufficient to establish such
            knowledge;

                (iii)  which  has  been   developed  by  the   receiving   party
            independent of any disclosure by the other party; or

                (iv) is subsequently, lawfully and in good faith obtained by the
            receiving  party on a  non-confidential  basis from a third party as
            shown by  documentation  sufficient  to establish the third party as
            the source of the  information,  provided  that such third party was
            not under an obligation to treat such  information in a confidential
            manner and had a lawful right to make such disclosure.

            Section 22. NOTICES. Any notice, communication, payment or demand to
be given to any party hereto  pursuant to this Agreement shall be in writing and
shall be sufficiently given or made for all purposes if delivered  personally to
such party, if sent to such party by receipt confirmed telecommunications, or if
sent to such party by recognized courier, addressed as follows:

            SVC:   SVC Pharma Inc.
                   c/o Pharmaceutical Resources, Inc.
                   One Ram Ridge Road
                   Spring Valley, NY  10997
                   Attention:  President

            PAR:   PAR SVC, LLC
                   c/o Pharmaceutical Resources, Inc.
                   One Ram Ridge Road
                   Spring Valley, NY  10977
                   Attention:  Kenneth I. Sawyer


                                       35
<PAGE>

            UDF:   UDF LLC
                   3 Clearings Way
                   Princeton, MA  01541
                   Attention:  Chairman

            With copies in any event to:

                   Stuart D. Baker
                   Chadbourne & Parke LLP
                   30 Rockefeller Plaza
                   New York, NY  10112

            and
                   Stephen A. Ollendorff, Esq.
                   Kirkpatrick & Lockhart LLP
                   1251 Avenue of the Americas
                   New York, NY  10020-1104

or to such other address as the addressee may have specified in a notice duly
given to the sender as provided herein. Any such notice, communication, payment
or demand shall be deemed to be received upon personal delivery, upon the day
sent by telecommunications, or upon the first business day following deposit
with a recognized courier for next day delivery.

            Section 23. FISCAL YEAR.  The fiscal year of the  Partnership  shall
end on the 31st day of December of each year.

            Section  24.  BOOKS  AND  RECORDS.  The  books  and  records  of the
Partnership shall be maintained at its principal office. Each Partner shall have
the right to inspect and audit said books and records upon reasonable notice and
at reasonable times.

            Section 25. APPLICABLE LAW. This Agreement shall be governed by, and
construed  and enforced in accordance  with,  the laws of the State of Delaware,
except  for the  provisions  of  Section  20 which  shall be  governed  by,  and


                                       36
<PAGE>

construed  and enforced in  accordance  with the law of the State of New York as
provided in Section 20(c).

            Section 26. SEVERABILITY. This Agreement is intended to be valid and
effective  under  any  applicable  law  and,  to the  extent  permissible  under
applicable  law shall be construed in a manner to avoid  violation or invalidity
under any applicable law. Should any terms or provisions of this Agreement be or
become  invalid,  illegal or  unenforceable  under any applicable law, the other
provisions  of this  Agreement  shall not be affected  and shall  remain in full
force and effect,  and to the extent  permissible under applicable law, any such
invalid,  illegal or unenforceable provision shall be deemed lawfully amended to
conform with the intent of the parties.

            Section 27. ENTIRE AGREEMENT; AMENDMENTS. This Agreement constitutes
the entire  agreement of the parties  hereto with respect to the subject  matter
hereof.  No amendment,  modification,  termination or waiver of any provision of
this Agreement shall be effective unless the same shall be in writing and signed
by all of the parties hereto.

            Section  28.  HEADINGS.  The  headings  in  this  Agreement  are for
reference  purposes  only  and  shall  not in any  manner  affect  the  meaning,
interpretation, enforceability or validity of this Agreement.

            Section 29. BINDING EFFECT. This Agreement shall be binding upon the
parties  hereto,  their  heirs,  legatees,   executors,  legal  representatives,
successors in interest,  assignees,  transferees,  creditors (including judgment
creditors), trustees (including trustees in bankruptcy) and any person acting in
a representative capacity for any of the foregoing.


                                       37
<PAGE>

Section 30. COUNTERPARTS. This
Agreement may be executed in any number of counterparts, each of which shall be
deemed to be an original, but all such counterparts together shall constitute
one and the same instrument.

            [SIGNATURE PAGE FOLLOWS]

            IN WITNESS WHEREOF, the parties hereto have executed this Agreement
effective the date aforesaid.

                                    SVC PHARMA, INC.


                                    By  /s/ EDWARD W. ALBRIGHT
                                        ----------------------
                                    Title: President



                                    PAR SVC, LLC

                                    By: Pharmaceutical Resources, Inc.
                                         its Managing Member



                                    By /s/ KENNETH I. SAWYER
                                       ---------------------
                                       Kenneth I. Sawyer, President



                                    UDF LP

                                    By:  Rhodes Technologies Inc.
                                         its General Partner



                                    By /s/ EDWARD W. ALBRIGHT
                                       ----------------------
                                       Title:


                                       38
<PAGE>


                                    EXHIBIT A
                                    ---------

                           Gross Profit Determination

Gross Sales:                 The invoiced amount billed to third parties
                             for Products excluding any amount included
                             in the invoiced amount in respect of sales
                             taxes, tariffs, customs, duties, excise
                             taxes, value added taxes, other taxes based
                             upon the amount invoiced and other
                             governmental charges incurred in connection
                             with the sale, exportation or importation
                             of Products.

Sales Deductions:            The cost of returns, cash, credit or such
                             reasonable level of free goods allowances
                             (to the extent associated directly with the
                             sale of Products) retroactive price
                             reductions and amounts refunded for
                             spoiled, rejected, damaged, outdated
                             Products, all as actually allowed, incurred
                             or paid but not passed on to the purchaser
                             and allowance for bad debts.

Rebates:                     The cost of the sum of rebates to
                             wholesalers and chain drug stores, health
                             maintenance organizations, buying groups,
                             closed provider pharmacies, vendor
                             chargebacks, discount to wholesalers,
                             stocking allowances, rebates to other
                             health provision plans, hospices, in
                             respect of Medicaid, Medicare or other
                             government health schemes and all other
                             government mandated rebates or allowances
                             as actually allowed, incurred or paid.
                             Where pricing or rebates are granted to
                             customers by one of the parties acting as
                             subcontractor for Sales and Marketing
                             combining Company and non-Company Products
                             as part of a package or bundle, the share
                             of discounts from list or rebates, etc.,
                             attributable to the products will be the
                             discounts or rebates agreed in a budget OR,
                             if not specifically agreed in a budget, the
                             lesser of (1) such discounts or rebates
                             calculated on a pro rata basis, using list
                             prices of relevant bundled products as a



<PAGE>

                             basis for apportionment or (2) such
                             discounts or rebates calculated of relevant
                             bundled products calculated at the highest
                             discount or highest rebate offered as a
                             basis for apportionment.

COG:                         The amount equal to the sum of direct
                             out-of-pocket costs for materials, supplies
                             and direct labor for Products, shipping and
                             insurance, to the extent applicable, as
                             shipped calculated using US GAAP and
                             including customary direct and indirect
                             manufacturing overheads based on the
                             greater of actual capacity utilization or a
                             two (2) shift, five (5) day week
                             utilization of the specific manufacturing
                             facility in respect of the manufacture of
                             Products, all other subcontractor's total
                             direct out-of-pocket costs in respect of
                             the manufacture of Products for materials,
                             supplies and direct labor using GAAP and
                             including customary direct and indirect
                             manufacturing overheads in respect of the
                             manufacture of Products.  Where kits, other
                             preparations or combination products are
                             included in sales, the COG may include
                             amounts relating to such sales, calculated
                             on the same proportionate basis as used in
                             recognizing the relevant Gross sales.

Cost of Promotion:           The out-of-pocket cost of marketing and
                             promotion of the Product, including without
                             limitation, the cost of telemarketing, promotions,
                             promotional materials, market research and samples.

Shipping and                 The amount equal to actual out-of-pocket
  Warehousing:               costs incurred for shipping, transportation
                             and warehousing of Products plus an allocation for
                             personnel and warehouse overhead as approved by the
                             Board of Directors.

General and                  An amount equal to the actual costs of
  Administrative             order taking, customer service, invoicing
  Expenses:                  and collections and administrative
                             functions, not to exceed in the aggregate 2% of
                             gross sales determined in accordance with this
                             Exhibit A.

                                       2
<PAGE>


Gross Profit:                The amount equal to Gross Sales minus the
                             aggregate of COG, Sales Deductions,
                             Rebates, Cost of Promotion, Shipping and
                             Warehousing Expense and General and
                             Administrative Expense.







                                       3

<PAGE>


                                    EXHIBIT B
                                    ---------

         Research and Development Costs shall be calculated at $85.00 per hour
(subject to an inflation adjustment to be agreed and approved by the Board of
Directors) plus out-of-pocket costs of special equipment and materials consumed.
If underlying costs increase, the Board of Directors may approve an upward
adjustment to the hourly rate stated herein.