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                              EMPLOYMENT AGREEMENT

         EMPLOYMENT AGREEMENT, dated as of October 6, 1995, by and between PDK
LABS INC., a New York corporation with offices at 145 Ricefield Lane, Hauppauge,
NY 11788 (the "Corporation"), and MICHAEL B. KRASNOFF, an individual residing at
5 Old Woods Drive, Harrison NY 10528 (the "Executive").

                               W I T N E S S E T H

         WHEREAS, on October 18, 1993, the Executive and the Corporation entered
into a seven (7) year Executive Employment Agreement; and

         WHEREAS, the Executive's leadership and services have
constituted a major factor in the growth and development of the
Corporation; and

         WHEREAS, the Corporation desires to continue to employ and retain the
unique experience, ability and services of the Executive as its principal
executive officer from the effective date hereof and to prevent any other
competitive business from securing his services, in utilizing his experience,
background and know-how.

         NOW, THEREFORE, the parties mutually agree as follows:

         1.       Employment.  The Corporation employs the Executive and
the Executive hereby accepts continued employment in a principal


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executive capacity and Chairman through December 31, 2005 (the "Executive
Employment").

         2. Duties. The Executive shall serve as the President, Chief Executive
Officer and Chief Financial Officer of the Corporation and shall properly
perform such duties as may be assigned to him from time to time by the Board of
Directors of the Corporation. If requested by the Corporation, the Executive
shall serve on any committee of the Corporation's Board of Directors without
additional compensation. There shall be no diminution or change in the
Executive's status or title without his express written consent. During the term
of this Agreement, the Executive shall devote substantially all of his business
time to the performance of his duties hereunder unless otherwise authorized by
the Board of Directors.

         3.       Compensation of the Executive.


                  3.1 Salary. During the period of Executive Employment, the
Corporation shall pay to the Executive a salary (the "Executive Salary") the
amount of which shall be fixed by the Board of Directors of the Corporation,
from time to time, during such period, provided that in no event shall the
Executive's Salary be at a rate less than four hundred thousand ($400,000)
dollars per year. Such compensation shall be paid to the Executive with the


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same frequency as other executives of the Corporation are compensated. In
addition to all other remuneration provided for in the Agreement, the Executive
shall be entitled to a cost of living adjustment (as hereinafter set forth) and
other fringe benefits to which executives of the Corporation are entitled.

                  As promptly as practical at the end of each year during the
term of this Executive Employment Agreement, the Corporation shall compute the
increase, if any, in the cost of living, using as the basis of such computation
the "Revised Consumers Price Index- Cities" hereinafter called the "Index,"
published by the Bureau of Labor Statistics of the United States Department of
Labor.

                  3.2 Discretionary Bonus. In addition to the annual salary set
forth in Section 3.1 above, the Executive shall be entitled to such bonus
compensation (in cash, capital stock or other property) as the Board of
Directors of the Corporation may determine from time to time in its sole
discretion.

                  3.3 Expenses. In addition to those expenses expressly set
forth herein, the Corporation shall pay or reimburse the Executive for all
reasonable out-of-pocket expenses actually incurred or paid by the Executive in
connection with performing his duties hereunder as President and as Chief
Financial Officer of the Corporation, of which no more than $100,000 shall be
non-



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accountable. The Corporation shall, at the direction of the Executive,
either reimburse the Executive for, or directly pay the costs of, membership
dues for any one (1) social or recreational club or organization that the
Executive chooses to join. Additionally, the Corporation shall, at the direction
of the Executive, either reimburse the Executive for, or directly pay the costs

of, membership dues for any professional organizations that the Executive
chooses to join. The Corporation shall also reimburse the Executive for any
disability insurance premiums actually paid by the Executive during the Term
hereof.

                  3.4 Automobile Allowance. With respect to Executive's use of
an automobile in connection with the performance of his duties hereunder,
Corporation shall, at the direction of Executive, either reimburse Executive
for, or directly pay the costs of, the use of an automobile during the Term of
this Agreement and all usual expenditures in connection therewith; i.e., fuel,

insurance, parking, customary maintenance and repairs, etc. The type of
automobile shall be selected by Executive.

                  3.5 Benefits. the Executive shall be entitled to participate
in such pension, profit sharing, group insurance, option plans, hospitalization,
and group health and benefit plans


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and all other benefits and plans as the Corporation provides to its
senior executives.

                  3.6      Equity Participation.

                  (a) Upon the execution hereof, Corporation hereby grants to
Executive options pursuant to the Company's Stock Option Plan to purchase up to
Two Hundred Fifty Thousand (250,000) shares of Corporation's common stock, par
value $.01 per share (the "Common Stock"), at an exercise price of Two Dollars
and Sixty Three Cents ($2.63). The options shall include demand registration
rights at the expense of the Corporation. Any unexercised options shall
automatically be extinguished upon the expiration or termination of this
Agreement.

                  (b) Upon the execution hereof, the Corporation hereby issues
to Executive, Four Hundred Thousand (400,000) shares of the Corporations Common
Stock, par value $.01 per value, provided however, that commencing upon the date
hereof through December 31, 2005 for each three (3) month period (or any part
thereof) that Executive is not employed by Corporation pursuant to the terms of
this Agreement for any reason whatsoever, unless otherwise agreed in writing by
the parties, Executive shall automatically forfeit Ten Thousand (10,000) shares
of Common Stock. Notwithstanding the foregoing, in the event that (i)
Corporation shall file a


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Registration Statement with the Securities and Exchange Commission on Form S-1
(or any other appropriate form) during the Term hereof and (ii) the underwriter
with respect to the Registration Statement (or Corporation, if there is not an
underwriter) has agreed to register any or all shares of Common Stock granted to
Executive hereunder, then none of such shares which are so registered will be
subject to forfeiture thereafter and only those shares, if any, that remain
unregistered shall be subject to the provisions of forfeiture (on a prorated
basis) set forth in the immediately preceding sentence.

                  (c) Corporation expressly agrees to pay on Executive's behalf
or reimburse Executive for any federal, state and local taxes of any nature
whatsoever (including but not limited to any income or capital gains taxes) that
Executive actually incurs with respect to his receipt of any of the securities,
or the proceeds therefrom, granted to Executive pursuant to this Section 3.7.

                  (d) The Corporation and the Executive agree that Section 4.6
of the December 1, 1991 Employment Agreement between Executive and the
Corporation shall remain in full force and effect.

                  3.7      Change of Control.


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                  (a) In the event that there occurs a "Change of Control" (as
defined below) during the term of this Agreement and as a result thereof the
Executive resigns or this Agreement is terminated, the Corporation expressly
agrees that upon such resignation or termination, the Corporation shall pay to
the Executive a sum equal to two times the entire compensation that the
Executive would have been entitled to through December 31, 2005, but in no event
less than $2,500,000. As used herein, the term "Change of Control" shall mean,
subject to Section 3.8(b) hereof, either

                    (i)  a sale of securities representing voting control of the
                         Corporation or a sale of all or substantially all of
                         the assets of the Corporation,

                    (ii) any merger, joint venture of other business combination
                         where the Corporation is either (x) not the surviving
                         entity or, (y) becomes the subsidiary of another
                         entity, or

                    (iii)the acquisition of more than ten percent (10%) of the
                         outstanding voting securities of the Corporation by any
                         entity(ies) or person(s) exclusive of the Executive or

                         any holder of the Company's securities on the date
                         hereof who


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                         presently owns more than 10%, either acting alone or as
                         a "group," as that term is defined for purposes of
                         Section 13(d) of the Securities Exchange Act of 1934,
                         as amended. 
                    
                    (iv) the increase in ownership, by an amount of 1% or more, 
                         of the outstanding voting  securities of the
                         Corporation by any entity(ies) or  person(s) owning
                         more than 5% on the date hereof.

                    (v)  the nomination of individuals for election to the board
                         of directors which elections will result in one-third
                         of the directors of the Company consisting of
                         individuals who have not been directors of the Company
                         for at least two years.

                    (vi) a tender offer for shares of the Corporation's common
                         stock is made, which tender is not approved by the
                         Company's Board of Directors and a majority of the
                         Corporation's outstanding stock is tendered thereunder.

                  (b) Notwithstanding anything set forth herein to the contrary,
in the event that the Executive, as a member of the Corporation's Board of
Directors, votes in favor of any of the transactions described in either Section
3.8(i) or 3.8(ii) above,


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then in such event, there shall not be deemed to have occurred a "Change of
Control" for the purposes of this Agreement.

                  3.8      Intentionally Omitted.

                  3.9 Loan to Executive. Upon the execution hereof, Corporation
shall make available to Executive a revolving line of credit of up to Five
Hundred Thousand Dollars ($500,000) pursuant to which Executive can borrow up to
such amount from Corporation from time to time and at any time during the Term

hereof (the "Line of Credit"). Any funds borrowed by Executive pursuant to the
Line of Credit shall bear interest at the prime rate as quoted in The Wall
Street Journal from time to time plus one-half of one percent (.5%) per annum,
which interest shall be payable monthly. In the event any sums are outstanding
pursuant to the Line of Credit upon the termination or expiration hereof, such
sums shall be automatically converted to a ten (10) year loan which shall be
fully amortized over one hundred twenty (120) consecutive monthly payments with
the rate of interest fixed upon the actual date of expiration or termination.
Executive agrees to execute any reasonable documents prepared by Corporation to
evidence the transactions described in this Section 3.9.

         4.       Disability.


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                  4.1 Death and Total Disability. In the event of the death or
total disability, the Executive, during the period of his Executive Employment,
his Executive Salary shall continue to be paid to the Executive, or his Estate
as the case may be, at the same rate that it was on the date of such disability.
If the Executive shall receive any disability payments from any insurance policy
paid for by the Corporation, the payments to the Executive during any period of
disability shall be reduced by the amount of disability payments received by the
Executive under any such insurance policy or policies. For the purposes of this
Agreement, disability shall mean mental or physical illness or condition
rendering the Executive incapable of performing his normal duties with the
Corporation.

         5. Vacations. the Executive shall be entitled to a vacation of four (4)
weeks per year, during which period his salary shall be paid in full. The
Executive shall take his vacation at such time or times as the Executive and the
Corporation shall determine is mutually convenient.

         6. Disclosure of Confidential Information. The Executive recognizes
that he has had and will continue to have access to secret and confidential
information regarding the Corporation, including but not limited to its customer
list, products, know-how,


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and business plans. The Executive acknowledges that such information is of great
value to the Corporation, is the sole property of the Corporation, and has been
and will be acquired by him in confidence. In consideration of the obligations

undertaken by the Corporation herein, the Executive will not, at any time,
during or after his employment hereunder, reveal, divulge or make known to any
person, any information acquired by the Executive during the course of his
employment, which is treated as confidential by the Corporation, including but
not limited to its customer list, and not otherwise in the public domain the
provisions of this Section 6 shall survive the Executive's employment hereunder.

         7.       Covenant Not To Compete.

                  (a) Executive recognizes that the services to be performed by
him hereunder are special, unique and extraordinary. The parties confirm that it
is reasonably necessary for the protection of the Corporation that the Executive
agree, and accordingly, the Executive does hereby agree, that he shall not,
directly or indirectly, at any time during the "Restricted Period" within the
"Restricted Area" (as those terms are defined in Section 8(e) below):


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                    (i)  except as provided in Subsection (c) below, engage in
                         the business of retail or mail order sale of vitamins
                         either on his own behalf or as an officer, director,
                         stockholder, partner, consultant, associate, employee,
                         owner, agent, creditor, independent contractor, or
                         co-venturer of any third party; or

                    (ii) employ or engage, or cause or authorize, directly or
                         indirectly, to be employed or engaged, for or on behalf
                         of himself or any third party, any employee or agent of
                         the Corporation.

                    (b) Executive hereby agrees that he  will not, directly or 
indirectly, for or on behalf of himself or any third party, at any time during 
the Term and during the Restricted Period solicit any customers of the
Corporation.

                  (c) If any of the restrictions contained in this Section shall
be deemed to be unenforceable by reason of the extent, duration or geographical
scope thereof, or otherwise, then the court making such determination shall have
the right to reduce such extent, duration, geographical scope, or other
provisions hereof, and in its reduced form this Section shall then be
enforceable in the manner contemplated hereby.


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                  (d) This Section 7 shall not be construed to prevent the
Executive from owning, directly and indirectly, in the aggregate, an amount not
exceeding five percent (5%) of the issued and outstanding voting securities of
any class of any corporation whose voting capital stock is traded on a national
securities exchange or in the over-the-counter market.

                  (e) The term "Restricted Period," as used in this Section 7,
shall mean the period of the Executive's actual employment hereunder plus: (i)
twelve (12) months after the date the Executive is actually no longer employed
by the Corporation in the event this Agreement expires or the Executive's
termination For Cause; (ii) twelve (12) months after the date the Executive is
actually no longer employed by the Corporation in the event that this Agreement
is terminated by the Corporation for any reason whatsoever except For Cause, or
if the Executive resigns for any reason during the Term, except for his
resignation pursuant to Section 3.8 hereof; and, (iii) twenty-four (24) months
after the date the Executive is actually no longer employed by the Corporation
in the event that the Executive resigns pursuant to Section 3.8 hereof. The term
"Restricted Area" as used in this Section 7 shall mean the seventy-five (75)
mile radius from the Corporation's principal executive offices.


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         (f) The provisions of this Section 7 shall survive the termination of
the Executive's employment hereunder and until the end of the Restricted Period
as provided in Section 7(e) hereof.

         8.       Miscellaneous.

                  8.1 Assignments. Neither the Executive nor the Corporation may
assign or delegate any of their rights or duties under this Agreement without
the express written consent of the other.

                  8.2 Entire Agreement. This Agreement constitutes and embodies
the full and complete understanding and agreement of the parties with respect to
the Executive's employment by the Corporation, supersedes all prior
understandings and agreements, whether oral or written, between the Executive
and the Corporation, including, but not limited to, the Prior Employment
Agreement, and shall not be amended, modified or changed except by an instrument
in writing executed by the party to be charged. The invalidity or partial
invalidity of one or more provisions of this Agreement shall not invalidate any
other provision of this Agreement. No waiver by either party of any provision or
condition to be performed shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same time or any prior or subsequent time.


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                  8.3 Binding Effect. This Agreement shall inure to the benefit
of, be binding upon and enforceable against, the parties hereto and their
respective successors, heirs, beneficiaries and permitted assigns.

                  8.4 Headings. The headings contained in this Agreement are for
convenience of reference only and shall not affect in any way the meaning or
interpretation of this Agreement.

                  8.5 Notices. All notices, requests, demands and other
communications required or permitted to be given hereunder shall be in writing
and shall be deemed to have been duly given when personally delivered, sent by
registered or certified mail, return receipt requested, postage prepaid, or by
private overnight mail service (e.g. Federal Express) to the party at the
address set forth above or to such other address as either party may hereafter
give notice of in accordance with the provisions hereof. Notices shall be deemed
given on the sooner of the date actually received or the third business day
after sending.

                  8.6 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York without giving
effect to such State's conflicts of laws provisions and each of the parties
hereto irrevocably consents to the


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jurisdiction and venue of the federal and state courts located in the State of
New York, County of Suffolk.

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

         IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date set forth above.

                                              PDK LABS INC.

                                              By:  /s/ Hartley T. Bernstein
                                                   -----------------------
                                                       Hartley T. Bernstein,
                                                       Assistant Secretary

                                                   /s/ Michael B. Krasnoff

                                                   -----------------------
                                                       Michael B. Krasnoff


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