EXHIBIT 10.1

           THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
       OF 1933, AS AMENDED, AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE
                  DISPOSED OF UNLESS REGISTERED UNDER THAT ACT
                 OR AN EXEMPTION FROM REGISTRATION IS AVAILABLE.

                            KIRK PHARMACEUTICALS, LLC

                           CONVERTIBLE PROMISSORY NOTE

$____________                                              Dated:  June __, 2007
("ORIGINAL PRINCIPAL AMOUNT")                              (the "ISSUANCE DATE")


                  WHEREAS,   Kirk   Pharmaceuticals,   LLC,  a  Florida  limited
liability  company (the "COMPANY" or the  "BORROWER")  are offering in a private
placement to accredited investors,  as defined by Rule 501 promulgated under the
Securities Act of 1933, as amended (the  "SECURITIES  ACT") (such offering,  the
"BRIDGE  OFFERING"),  up to $5,000,000 in convertible  bridge notes (as amended,
modified and supplemented from time to time, this  "CONVERTIBLE  NOTE" or "NOTE"
or "AGREEMENT"  and together with other  Convertible  Notes issued in the Bridge
Offering, the "CONVERTIBLE NOTES" or "NOTES") issued by the Borrower;

                  WHEREAS, in connection with the Bridge Offering,  the Borrower
wishes to borrow  from the  holder  designated  below  the  principal  amount of
____________________ (US$__________) (the "PRINCIPAL"); and

                  WHEREAS,  in  connection  with the Bridge  Offering,  Synovics
Pharmaceuticals,  Inc.  ("SYNOVICS")  has agreed to issue shares of its Series B
Convertible Preferred Stock, par value $0.001 per share (the "SERIES B PREFERRED
STOCK" or the "SERIES B SHARES" to the Holders  (defined  below) pursuant to the
terms set forth below.

                  FOR VALUE  RECEIVED the  Borrower,  hereby  promises to pay to
_____________________  (the "PAYEE" or "HOLDER"; all Holders may be collectively
referred to as the "HOLDERS"),  or its registered assigns,  the principal amount
of   _____________________   ($____________)   together  with  interest  thereon
calculated  from the date  hereof  in  accordance  with the  provisions  of this
Convertible Note.

                  Certain capitalized terms are defined in SECTION 12 hereof.

1.  PAYMENT OF  INTEREST.  Interest  shall accrue at a rate equal to six percent
(6%) per annum (the  "INTEREST  RATE"),  beginning on the Issuance  Date, on the
unpaid  principal amount of this Convertible Note outstanding from time to time;
PROVIDED  THAT, so long as any Event of Default has occurred and is  continuing,
interest shall be deemed to accrue,  to the extent permitted by law, at the rate
of 18% per annum  from the date on which  such  Event of  Default  occurs on the
unpaid  principal  amount of this Convertible Note outstanding from time to time
through the date on


<PAGE>

which such Event of Default  ceases to exist.  Interest shall be computed on the
basis of the actual number of days elapsed and a 360-day year. In no event shall
any interest to be paid  hereunder  exceed the maximum rate permitted by law. In
any such  event,  this Note  shall  automatically  be deemed  amended  to permit
interest  charges at an amount equal to, but no greater  than,  the maximum rate
permitted by law.

2. MATURITY DATE;  PAYMENTS.  (a) Unless converted  pursuant to Section 4 below,
the entire  principal amount of this Convertible Note and all accrued but unpaid
interest  thereon  shall  be due and  payable  in  full  in cash in  immediately
available  funds on the six (6)  month  anniversary  of the  Issuance  Date (the
"MATURITY  DATE").  Any overdue principal and overdue interest together with any
interest thereon shall be due and payable upon demand.

                  (b) The  Borrower  may,  with ten (10)  Business  Days'  prior
written notice delivered to the Holder,  prepay all or any part of the Principal
of, and  accrued  and unpaid  interest  on,  this Note,  without  payment of any
premium or penalty.  All payments on this Note shall be applied first to accrued
interest hereon,  then to any outstanding fees and expenses,  and the balance to
the payment of Principal hereof.

                  (c) Payments of Principal of, and interest on, this Note shall
be made by check sent to the Holder's  address set forth on the  signature  page
hereto or to such other  address as the Holder may  designate  for such  purpose
from time to time by written notice to the Borrower, in such coin or currency of
the United States of America as at the time of payment shall be legal tender for
the  payment of public  and  private  debts.  Alternatively,  Principal  of, and
interest  on,  this  Note  with  respect  to the  Maturity  Date  may be paid by
electronic wire transfer in accordance with instructions  provided by the Holder
to the Borrower at least ten (10) Business Days prior to the Maturity Date.

                  (d) The obligations to make the payments  provided for in this
Note are absolute  and  unconditional  and not subject to any defense,  set-off,
counterclaim,  rescission,  recoupment,  or adjustment whatsoever.  The Borrower
hereby  expressly   waives  demand  and  presentment  for  payment,   notice  of
non-payment,  notice of dishonor,  protest, notice of protest, bringing of suit,
and diligence in taking any action to collect any amount  called for  hereunder,
and shall be directly and primarily liable for the payment of all sums owing and
to be owing  hereon,  regardless of and without any notice,  diligence,  act, or
omission with respect to the collection of any amount called for hereunder.

3.       PLEDGE; GUARANTY.

                  (a) Subject to Section 9(e), this Note is senior  indebtedness
of the Borrower.

                  (b)  This  Note is  secured  by a pledge  by  Ronald  H.  Lane
("LANE") of all of his right,  title, and interest in and to 2,000,000 shares of
common stock, par value $0.001 per share, of Synovics ("COMMON STOCK"), pursuant
to a Pledge  Agreement,  dated as of the date  hereof  and  attached  hereto  as
EXHIBIT A, to be entered into between Lane and the Holder (the  "PLEDGE") on the
Issuance Date.



                                       2
<PAGE>


4.  CONVERSION.  (a) In the event a Qualified  Equity  Financing  (as defined in
Section 12) is consummated  prior to the Maturity Date, the Principal  amount of
this   Convertible   Note  plus  accrued  and  unpaid  interest   thereon  shall
automatically  be  converted  into a number  of  shares  of  Synovics'  Series C
Preferred Stock (the "SERIES C PREFERRED" or the "CONVERSION  SHARES")  obtained
by dividing (x) 110% of the unpaid  Principal and accrued and unpaid interest on
this  Note by (y) the  price  paid by  investors  per  share  (such  price,  the
"CONVERSION  PRICE") in the Qualified Equity  Financing.  The Company shall give
Payee not less than three (3) days' prior  written  notice of the closing of any
Qualified  Equity  Financing.  The Series C Preferred to be issued upon any such
conversion  shall  have the  same  rights,  preferences  and  privileges  as the
securities  issued in the Qualified  Equity  Financing.  Concurrently  with such
automatic  conversion,   the  Payee  shall  also  be  entitled  to  receive  its
proportionate share of any warrants,  options, rights or other securities issued
to investors in the Qualified Equity Financing and shall be entitled to the same
registration and other rights granted to the holders of securities issued in the
Qualified Equity Financing under the agreements  relating thereto. No fractional
shares shall be issued upon a conversion into Conversion  Shares. In lieu of any
fractional shares to which Payee would otherwise be entitled,  the Company shall
pay cash equal to such fraction multiplied by the Conversion Price.

                  (b)  As  soon  as  possible   after  any  conversion  of  this
Convertible Note has been effected,  the Company shall deliver to the converting
holder an  original  certificate  or  certificates  representing  the  number of
Conversion  Shares  issuable by reason of such  conversion in such name or names
and such  denomination or denominations as the converting  holder has specified;
PROVIDED,  HOWEVER,  that the  Borrower  shall not be required  to deliver  such
certificate or certificates  until the Holder has surrendered this original Note
and the  certificates  representing the Series B Preferred Stock to Borrower for
cancellation.

                  (c) The issuance of  certificates  for Conversion  Shares upon
conversion of this  Convertible  Note in the name of the party  converting  this
Note shall be made without  charge to the Holder for any issuance tax in respect
thereof or other cost  incurred by Synovics  or the Company in  connection  with
such conversion and the related  issuance of shares of Conversion  Shares.  Upon
conversion of this Convertible Note, Synovics shall take all such actions as are
necessary in order to insure that the Conversion Shares issuable with respect to
such conversion and the shares of Common Stock underlying such Conversion Shares
shall be validly issued, fully paid and nonassessable.

                  (d) Except as required by applicable  law,  Synovics shall not
close its books  against the transfer of  Conversion  Shares  issued or issuable
upon conversion of this Convertible Note in any manner which interferes with the
timely conversion of this Convertible Note.  Synovics shall assist and cooperate
with any  holder of this  Convertible  Note  required  to make any  governmental
filings or obtain any  governmental  approval prior to or in connection with the
conversion of this Convertible Note (including,  without limitation,  making any
filings required to be made by Synovics).



                                       3
<PAGE>


                  (e) Synovics  shall at all times during which this Note may be
converted  into  Conversion  Shares  reserve  and  keep  available  out  of  its
authorized  but unissued  shares of preferred  stock,  solely for the purpose of
issuance upon  conversion  hereunder,  such number of shares of preferred  stock
sufficient  to issue  the  Series C  Preferred  issuable  upon  conversion.  All
Conversion Shares shall, when issued, be duly and validly issued, fully paid and
nonassessable  and free from all taxes,  liens and charges  (except for any such
liens  created by the  Holder).  Synovics  shall take all such actions as may be
necessary  to  assure  that  all  Conversion  Shares  may be so  issued  without
violation of any applicable law or governmental  regulation or any  requirements
of any domestic securities exchange upon which such shares of capital stock.

5. METHOD OF PAYMENTS.

                  (a) PAYMENT. So long as the Payee or any of its nominees shall
be the holder of any Convertible Note, and  notwithstanding  anything  contained
elsewhere in this  Convertible  Note to the contrary,  the Borrower will pay all
sums  for  principal,  interest,  premiums  or  otherwise  becoming  due on this
Convertible  Note held by the Payee or such nominee not later than 5:00 p.m. New
York time, on the date such payment is due, in immediately  available  funds, in
accordance  with the  payment  instructions  that the  Payee  may  designate  in
writing,  without the  presentation or surrender of such Convertible Note or the
making of any notation thereon, except in the case of any payment of any amounts
due and payable on the Maturity Date, which amounts shall be paid upon surrender
of this Note for  cancellation.  Any payment made after 5:00 p.m. New York time,
on a Business Day will be deemed made on the next following Business Day. If the
due date of any  payment in respect of this Note would  otherwise  fall on a day
that is not a  Business  Day,  such  due  date  shall  be  extended  to the next
succeeding  Business  Day,  and  interest  shall be payable on any  principal so
extended  for the  period of such  extension.  All  amounts  payable  under this
Convertible  Note  shall be paid free and clear of,  and  without  reduction  by
reason of, any deduction, set-off or counterclaim.  The Borrower will afford the
benefits  of this  Section to the Payee and to each other  Person  holding  this
Convertible Note.

                  (b) TRANSFER AND  EXCHANGE.  Subject to  applicable  law, upon
surrender of any Convertible  Note for  registration of transfer or for exchange
to the Borrower at its principal  office,  the Borrower at its sole expense will
execute and deliver in exchange  therefor a new Convertible  Note or Convertible
Notes,  as the case may be, as  requested  by the  holder or  transferee,  which
aggregate the unpaid principal amount of such  Convertible  Note,  registered as
such holder or  transferee  may request,  dated so that there will be no loss of
interest on the Convertible Note and otherwise of like tenor; provided that this
Convertible  Note  may not be  transferred  by Payee to any  Person  other  than
Payee's  affiliates  without the prior  written  consent of the Borrower  (which
consent  shall not be  unreasonably  withheld or  delayed).  The issuance of new
Convertible  Notes  shall  be  made  without  charge  to  the  holder(s)  of the
surrendered  Convertible  Note for any issuance tax in respect  thereof or other
cost incurred by the Borrower in connection  with such  issuance,  provided that
each Convertible  Noteholder shall pay any transfer taxes associated  therewith.
The  Borrower  shall  be  entitled  to  regard  the  registered  holder  of this
Convertible  Note as the holder of the  Convertible  Note so registered  for all
purposes until the Borrower or its agent, as applicable, is required to record a
transfer of this Convertible Note on its register.



                                       4
<PAGE>

                  (d)   REPLACEMENT.   Upon   receipt  of  evidence   reasonably
satisfactory  to the Borrower of the loss,  theft,  destruction or mutilation of
any Convertible  Note and, in the case of any such loss, theft or destruction of
any Convertible  Note, upon receipt of an indemnity  reasonably  satisfactory to
the  Borrower or, in the case of any such  mutilation,  upon the  surrender  and
cancellation  of such  Convertible  Note,  the  Borrower,  at its expense,  will
execute and deliver,  in lieu thereof,  a new Convertible Note of like tenor and
dated the date of such lost, stolen, destroyed or mutilated Convertible Note.

6. WARRANTS.  Upon the closing of a Qualified  Equity  Financing (such date, the
"CLOSING  DATE") in  addition  to the  Conversion  Shares  and other  securities
described in Section 4(a) issued to Holder in connection  with the conversion of
the Convertible Notes,  Synovics shall issue to the Holder warrants (the "BRIDGE
WARRANTS") to purchase a number of shares of Common Stock (the "WARRANT SHARES")
equal to forty percent (40%) of the number of shares of Common Stock issuable to
Holder upon conversion of Holder's  Conversion Shares receivable upon conversion
of the Convertible Notes held on the Closing Date; PROVIDED,  HOWEVER,  that (i)
if the initial closing of the Qualified  Equity  Financing takes place more than
ninety (90) days and less than one hundred twenty (120) days following the final
closing of the Bridge  Offering,  then the  number  shares of Common  Stock into
which the Bridge Warrants are  exercisable  shall be forty five percent (45%) of
the number of shares of Common  Stock  issuable  to Holder  upon  conversion  of
Holder's  Conversion  Shares receivable upon conversion of the Convertible Notes
held on the  Closing  Date;  and (ii) if the  initial  closing of the  Qualified
Equity  Financing  takes place more than one hundred and twenty (120) days after
the final closing of the Bridge Offering, then the number shares of Common Stock
into which the Bridge Warrants are  exercisable  shall be fifty percent (50%) of
the number of shares of Common  Stock  issuable  to Holder  upon  conversion  of
Holder's  Conversion  Shares receivable upon conversion of the Convertible Notes
upon conversion of the Convertible  Notes held on the Closing Date. The exercise
price and all other terms of the Bridge  Warrants shall be identical to those of
the warrants  issued to investors in the Qualified  Equity  Financing,  provided
that, if no warrants are issued to investors in the Qualified Equity  Financing,
the Bridge  Warrants  shall have the same  terms as the  warrants  issued to the
Placement  Agent in connection  with the Qualified  Equity  Financing,  provided
further, that in such latter event, the Bridge Warrants shall not be exercisable
on a net issuance or "cashless" basis.

7. GRANT OF STOCK.  As  additional  consideration  for the Holders'  investment,
Synovics  shall issue a share  certificate  to Axiom  Capital  Management,  Inc.
("AXIOM"),  as nominee for the Holders,  for one million  (1,000,000)  shares of
Synovics' Series B Convertible  Preferred Stock.  Such Series B Shares shall (i)
be  convertible  into  shares  of  Common  Stock on a 1:15  basis  and (ii) have
full-ratchet  anti-dilution  protection.  Upon the  occurrence  of any  Event of
Default,  the  Holders  may, at their  option,  convert the Series B Shares into
Common  Stock.  The Series B Shares shall be  surrendered  to Synovics  upon the
consummation of a Qualified  Equity Financing as partial  consideration  for the
Conversion  Shares.  Except upon the occurrence of an Event of Default,  neither
Axiom nor the Holder may sell, pledge, transfer,  encumber, or otherwise dispose
or  convert  any of the Series B Shares  without  the prior  written  consent of
Synovics.

8.  REPRESENTATIONS AND WARRANTIES OF THE COMPANY.  The Company hereby makes the
following  representations  and  warranties  to the Purchaser as of the Issuance
Date:


                                       5
<PAGE>


                  (a) ORGANIZATION AND  QUALIFICATION;  MATERIAL ADVERSE EFFECT.
The Company is a limited  liability  company  duly  formed and  existing in good
standing  under the laws of the State of Florida and has the requisite  power to
own its  properties  and to carry on its  business as now being  conducted.  The
Company does not have any  subsidiaries  other than the  subsidiaries  listed on
Schedule  8(a)  attached  hereto.  The Company is a wholly owned  subsidiary  of
Synovics.  The Company is duly  qualified  to do  business as a foreign  limited
liability  company and is in good  standing in every  jurisdiction  in which the
nature  of  the  business   conducted  or  property   owned  by  it  makes  such
qualification  necessary  other  than  those in which the  failure so to qualify
would  not have a  Material  Adverse  Effect.  Synovics  is a  corporation  duly
incorporated  and existing in good standing under the laws of Nevada and has the
requisite  corporate power to own its properties and to carry on its business as
now being  conducted.  Synovics  does not have any  subsidiaries  other than the
subsidiaries  listed  on  Schedule  8(a)  attached  hereto.  Except as listed in
Schedule  8(a),  Synovics  is  duly  qualified  to  do  business  as  a  foreign
corporation and is in good standing in every jurisdiction in which the nature of
the  business  conducted  or  property  owned  by it  makes  such  qualification
necessary  other than those in which the failure so to qualify  would not have a
Material Adverse Effect.  "MATERIAL  ADVERSE EFFECT" means any adverse effect on
the business, operations, properties, prospects or financial condition of any of
the Company,  Synovics, and subsidiaries,  if any, and which is (either alone or
together with all other adverse effects) material to the Company,  Synovics, and
subsidiaries,  if any, taken as a whole,  and any material adverse effect on the
transactions contemplated under this Note.

                  (b) AUTHORIZATION; ENFORCEMENT. (i) Except with respect to the
Series B Shares,  each of the Company and Synovics has all  requisite  power and
authority,  corporate and otherwise,  to enter into and perform,  as applicable,
the Notes and any other ancillary document contemplated hereunder (collectively,
the  "TRANSACTION  DOCUMENTS") and to issue the Notes and the Series B Shares in
accordance  with the terms  hereof,  (ii)  except  with  respect to the Series B
Shares,  the execution and delivery of the Transaction  Documents by the Company
and  Synovics  and the  consummation  by them of the  transactions  contemplated
hereby  and  thereby,  including  the  issuance  of the  Notes,  have  been duly
authorized by all necessary  action,  corporate  and  otherwise,  and no further
consent or  authorization  of the Company,  Synovics or the applicable  Board of
Directors  (or  any  committee  or  subcommittee  thereof)  or  stockholders  is
required,  (iii) the Transaction Documents have been duly executed and delivered
by the Company,  (iv) the  Transaction  Documents  constitute  valid and binding
obligations of the Company and Synovics  enforceable against each of the Company
and Synovics, as applicable, except (A) as such enforceability may be limited by
applicable bankruptcy,  insolvency,  reorganization,  moratorium, liquidation or
similar laws relating to, or affecting  generally the  enforcement of creditors'
rights and remedies or by other equitable principles of general application, and
(B) to the extent the indemnification  provisions  contained in the Notes may be
limited by applicable  federal or state  securities  laws and (v) subject to any
requisite  action to be taken by  Synovics  and upon  issuance  of the  Series B
Shares and the  Common  Stock  issuable  upon  conversion  thereof  and  payment
therefor in accordance with the terms of the Transaction Documents, the Series B
Shares  and the Common  Stock  issuable  upon  conversion  thereof  will be duly
authorized, validly issued, fully paid and non-assessable, free and clear of any
and all liens,  claims and  encumbrances  except to the extent of the authorized
amount of Common Stock of Synovics  available at the time of  conversion  of the
Series B Shares into shares of Common Stock.



                                       6
<PAGE>

                  (c)  CAPITALIZATION.  As of the date  hereof,  the  authorized
capital  stock of Synovics  consists of  45,000,000  shares of Common  Stock and
600,000 shares of Class A Preferred  Stock, of which as of the date hereof,  (i)
29,714,630  shares of Common Stock and 118,370 shares of Class A Preferred Stock
are issued  and  outstanding,  and (ii)  10,016,915  shares of Common  Stock are
issuable and reserved for issuance  pursuant to Synovics'  stock option plans or
securities  exercisable  or  exchangeable  for, or convertible  into,  shares of
Common Stock  (excluding  any possible  conversion of the 2006 Notes (as defined
below),  the Asia Pacific Note (as defined  below) and any Common Stock issuable
upon  exercise  of any  purchase  right under the Rights  Agreement  (as defined
below)). No shares of Series B Preferred Stock and Series C Preferred Stock have
been authorized. All of such outstanding shares have been, or upon issuance will
be, validly issued, fully paid and nonassessable.  As of the date hereof, except
as disclosed in Synovics'  most recent annual report on Form 10-K filed with the
Securities and Exchange  Commission  (the "SEC") and  subsequent  public filings
including, without limitation, any exhibits referred to or attached to such Form
10-K and subsequent public filings  (collectively,  the "SEC FILINGS") under the
Securities  Exchange Act of 1934, as amended (the "EXCHANGE ACT"), (i) no shares
of Synovics' capital stock are subject to preemptive rights or any other similar
rights or any liens or  encumbrances  suffered or permitted  by  Synovics,  (ii)
there are no  outstanding  debt  securities  of the Company,  Synovics or any of
their respective Subsidiaries, (iii) there are no outstanding options, warrants,
scrip, rights to subscribe to, calls or commitments of any character  whatsoever
relating to, or securities  or rights  convertible  into,  any shares of capital
stock  of  Synovics  or any  of its  Subsidiaries,  or  contracts,  commitments,
understandings  or arrangements by which Synovics or any of its  Subsidiaries is
or may become bound to issue  additional  shares of capital stock of Synovics or
any of its  subsidiaries or options,  warrants,  scrip,  rights to subscribe to,
calls or commitments of any character  whatsoever  relating to, or securities or
rights  convertible  into, any shares of capital stock of Synovics or any of its
Subsidiaries,  (iv) there are no agreements or arrangements under which Synovics
or any of its Subsidiaries is obligated to register the sale or resale of any of
their securities under the Securities Act of 1933, as amended  ("SECURITIES ACT"
or "1933 ACT"),  (v) there are no  outstanding  securities of Synovics or any of
its Subsidiaries which contain any redemption or similar  provisions,  and there
are no contracts, commitments,  understandings or arrangements by which Synovics
or any of its  Subsidiaries  is or may  become  bound to  redeem a  security  of
Synovics  or any of its  Subsidiaries,  and  (vi)  there  are no  securities  or
instruments  containing   anti-dilution  or  similar  provisions  that  will  be
triggered by the issuance or conversion,  as  applicable,  of the Note or Bridge
Warrants.  Synovics has made  available to the Holder true and correct copies of
Synovics' organizational documents, as amended and as in effect on the date, and
the terms of all securities  convertible or exchangeable into or exercisable for
Common Stock and the material rights of the holders thereof in respect thereto.

                  (d) [Intentionally Deleted]

                  (e) NO CONFLICTS.  The execution,  delivery and performance of
the  Transaction  Documents  by  each  of  the  Company  and  Synovics  and  the
consummation by the Company and Synovics of the transactions contemplated hereby
and thereby and issuance of the Notes and Series B Shares will not (i) except as
set forth in Section 8(b), result in a violation of the Certificate of Formation
or  Operating  Agreement of the Company or the  Articles of  Incorporation,  any
certificate of designations, preferences and rights of any outstanding series of
preferred  stock of Synovics or the By-laws of Synovics;  (ii) conflict with, or
constitute  a default



                                       7
<PAGE>


(or an event which with notice or lapse of time or both would  become a default)
under, or give to others any rights of termination,  amendment,  acceleration or
cancellation  of, any  agreement,  indenture or instrument to which the Company,
Synovics or any of their respective Subsidiaries is a party, or (iii) to each of
the Company's and Synovics'  knowledge  result in a violation of any law,  rule,
regulation, order, judgment or decree (including United States federal and state
securities  laws and  regulations and the rules and regulations of the principal
securities  exchange  or trading  market on which the Common  Stock is traded or
listed  ("PRINCIPAL   MARKET"),   applicable  to  the  Company  or  any  of  its
Subsidiaries  or by which any  property  or asset of the  Company  or any of its
Subsidiaries  is bound or  affected,  except  in the case of clause  (ii),  such
conflicts that would not have a Material Adverse Effect.

                  (f)  ABSENCE OF  LITIGATION.  Except as  disclosed  in the SEC
Filings, there is no action, suit,  proceeding,  inquiry or investigation before
or by any court, public board, government agency,  self-regulatory  organization
or  body  pending  or,  to the  knowledge  of the  Company,  Synovics  or  their
respective Subsidiaries  threatened against or affecting the Company,  Synovics,
or their  respective  Subsidiaries,  the Common Stock or any of the Company's or
Synovics' officers or directors in their capacities as such, the effect of which
would be reasonably likely to have a Material Adverse Effect.

                  (g) NO INTEGRATED OFFERING.  Neither the Company, Synovics nor
any of their  affiliates,  nor any  person  acting on its or their  behalf  has,
directly or  indirectly,  made any offers or sales of any  security or solicited
any  offers to buy any  security,  under  circumstances  that  would  cause this
offering of the Notes to the Purchaser to be integrated  with prior offerings by
the Company or Synovics such that registration of the Notes under the Securities
Act would be required or under any applicable  stockholder  approval provisions,
including,  without limitation, under the rules and regulations of the Principal
Market,  nor will the Company,  Synovics or any of their  Subsidiaries  take any
action or steps that would cause the offering of the Notes to be integrated with
other  offerings  such that  registration  of the Notes under the Securities Act
would be required.

                  (h)  EMPLOYEE  RELATIONS.  Except  as  disclosed  in  the  SEC
Filings, neither the Company,  Synovics nor any of their respective Subsidiaries
is involved in any labor dispute nor, to the knowledge of the Company,  Synovics
or any of their respective  Subsidiaries,  is any such dispute  threatened,  the
effect of which  would be  reasonably  likely to  result in a  Material  Adverse
Effect.  Except as disclosed in the SEC Filings,  neither the Company,  Synovics
nor any their  respective  Subsidiaries  is a party to a  collective  bargaining
agreement.

                  (i) INTELLECTUAL  PROPERTY RIGHTS.  Except as disclosed in the
SEC Filings,  the Company,  Synovics and their  respective  Subsidiaries  own or
possess adequate rights or licenses to use all trademarks,  trade names, service
marks,  service mark  registrations,  service  names,  patents,  patent  rights,
copyrights, inventions, licenses, approvals, governmental authorizations,  trade
secrets and rights  necessary  to conduct  their  respective  businesses  as now
conducted.  Except as disclosed in the SEC  Filings,  the Company,  Synovics and
their  respective  Subsidiaries do not have any knowledge of any infringement by
the Company, Synovics or their respective Subsidiaries of trademark,  trade name
rights, patents, patent rights, copyrights, inventions, licenses, service names,
service marks, service mark registrations,  trade secret or other similar rights
of others,  or of any such  development of similar or identical trade secrets or
technical



                                       8
<PAGE>

information by others and there is no claim,  action or proceeding being made or
brought  against,  or to  the  knowledge  of the  Company  and  Synovics,  being
threatened  against,  the  Company,  Synovics or their  respective  Subsidiaries
regarding trademarks,  trade name rights,  patents,  patent rights,  inventions,
copyrights,  licenses, service names, service marks, service mark registrations,
trade secrets or other infringement.

                  (j) COMPLIANCE WITH LAW. The business of the Company, Synovics
and their  respective  Subsidiaries has been and is presently being conducted so
as to comply with all applicable material federal,  state and local governmental
laws, rules, regulations and ordinances.

                  (k)  ENVIRONMENTAL  LAWS.  Except  as  disclosed  in  the  SEC
Filings, the Company, Synovics and their respective Subsidiaries (i) are, to the
knowledge of the Company and Synovics, in compliance with any and all applicable
foreign,  federal,  state  and  local  laws  and  regulations  relating  to  the
protection  of human health and safety,  the  environment  or hazardous or toxic
substances or wastes,  pollutants or contaminants  ("ENVIRONMENTAL  LAWS"), (ii)
have received all permits,  licenses or other  approvals  required of them under
applicable  Environmental Laws to conduct their respective  businesses and (iii)
are in compliance  with all terms and conditions of any such permit,  license or
approval where such  noncompliance  or failure to receive  permits,  licenses or
approvals  referred  to  in  clauses  (i),  (ii)  or  (iii)  above  could  have,
individually or in the aggregate, a Material Adverse Effect.

                  (l) DISCLOSURE.  No  representation or warranty by the Company
or  Synovics  in this  Agreement,  nor in any  certificate,  Schedule or Exhibit
delivered  or to be  delivered  pursuant  to this  Agreement:  contains  or will
contain any untrue  statement of material  fact or omits or will omit to state a
material fact necessary to make the statements  contained  herein or therein not
misleading.  Each of the SEC Filings  complied,  when so filed,  in all material
respects with the Exchange Act and the applicable  rules and  regulations of the
SEC  thereunder  and such SEC Filings do not contain any untrue  statement  of a
material fact or omit to state a material fact  necessary to make the statements
therein,  in  light  of the  circumstances  under  which  they  were  made,  not
misleading.  To the  knowledge  of the Company,  Synovics  and their  respective
Subsidiaries  at the  time of the  execution  of  this  Agreement,  there  is no
information concerning the Company,  Synovics and their respective  Subsidiaries
or their  respective  businesses which has not heretofore been disclosed or made
available to the Holders (or  disclosed  in the SEC  Filings)  that would have a
Material Adverse Effect.

                  (m)  TITLE.  Except  as  disclosed  in the  SEC  Filings,  the
Company,  Synovics and their  respective  Subsidiaries  have good and marketable
title in fee simple to all real  property and good and  marketable  title to all
personal property,  including but not limited to intellectual property, owned by
them which is  material  to the  business  of the  Company,  Synovics  and their
respective Subsidiaries,  in each case free and clear of all liens, encumbrances
and defects except such as do not  materially and adversely  affect the value of
such property and do not interfere  with the use made and proposed to be made of
such property by the Company,  Synovics or any of their respective Subsidiaries.
Any real property and  facilities  held under lease by the Company,  Synovics or
any of their respective  Subsidiaries  are held by them under valid,  subsisting
and  enforceable  leases with such  exceptions  as are not  material  and do not
interfere  with  the use  made  and  proposed  to be made of such  property  and
buildings by the Company, Synovics and their respective Subsidiaries.


                                       9
<PAGE>


                  (n)  INSURANCE.  Except as disclosed  in the SEC Filings,  the
Company,  Synovics  and each of their  respective  Subsidiaries  are  insured by
insurers of recognized  financial  responsibility  against such losses and risks
and in such amounts as  management  of the Company and  Synovics  believes to be
prudent and  customary  for a company of  Synovics'  size and  resources  in the
businesses in which the Company,  Synovics and their respective Subsidiaries are
engaged.

                  (o)  REGULATORY  PERMITS.  Except  as  disclosed  in  the  SEC
Filings, to the knowledge of the Company and Synovics, the Company, Synovics and
their respective Subsidiaries possess all material certificates,  authorizations
and  permits  issued by the  appropriate  federal,  state or foreign  regulatory
authorities,  necessary to conduct their respective businesses,  and neither the
Company,  Synovics  nor any of their  respective  Subsidiaries  has received any
notice of  proceedings  relating to the revocation or  modification  of any such
certificate, authorization or permit.

                  (p) FOREIGN  CORRUPT  PRACTICES  ACT. To the  knowledge of the
Company and Synovics, neither the Company, Synovics, nor any director,  officer,
agent, employee or other person acting on behalf of the Company, Synovics or any
Subsidiary  has,  in the course of acting  for,  or on behalf of, the Company or
Synovics,  directly or  indirectly  used any  corporate  funds for any  unlawful
contribution,  gift,  entertainment  or  other  unlawful  expenses  relating  to
political activity;  directly or indirectly made any direct or indirect unlawful
payment  to any  foreign  or  domestic  government  official  or  employee  from
corporate  funds;  violated  or is in  violation  of any  provision  of the U.S.
Foreign Corrupt  Practices Act of 1977, as amended,  or any similar  treaties of
the United States;  or directly or indirectly  made any bribe,  rebate,  payoff,
influence payment, kickback or other unlawful payment to any foreign or domestic
government or party official or employee.

                  (q) TAX  STATUS.  Except as  disclosed  in the SEC Filings and
except for  Synovics'  most recent  federal and state tax returns,  the Company,
Synovics and each of their respective  Subsidiaries has made or filed all United
States  federal  and  state  income  and all  other  tax  returns,  reports  and
declarations  required by any  jurisdiction  to which it is subject and all such
returns, reports and declarations are true, correct and accurate in all material
respects.  The Company and Synovics  have paid all taxes and other  governmental
assessments and charges,  due by them and payable including,  without limitation
those shown or determined to be due on such returns,  reports and  declarations,
except those being  contested in good faith,  for which  adequate  reserves have
been established,  in accordance with generally accepted  accounting  principles
("GAAP").

                  (r) ABSENCE OF UNDISCLOSED LIABILITIES.  The Company, Synovics
and their respective Subsidiaries have no material obligations or liabilities of
any  nature  (matured,  fixed or  contingent)  other  than (i) those  adequately
provided for in the Company's financial statements or otherwise disclosed in the
SEC Filings,  (ii) those obligations incurred in the ordinary course of business
in amounts  consistent with prior periods which have not had and will not have a
Material  Adverse  Effect on the Company or  Synovics,  (iii) as a result of any
future restatement of Synovics' consolidated financial statements arising out of
Emerging Issue Task Force 0019 and amortization of certain  intangible assets of
Synovics and/or its subsidiaries (the "RESTATEMENT").


                                       10
<PAGE>


                  (s)  FINANCIAL  STATEMENTS.  The  financial  statements of the
Company  and  Synovics  have been  prepared  from the books and  records  of the
Company and Synovics,  respectively, in accordance with GAAP, and fairly present
in all material  respects the  financial  condition of the Company and Synovics,
respectively,  as at their  respective  dates, and the results of its operations
and cash flows for the periods  covered  thereby  except to the extent that such
financial statements are amended by any Restatement.

                  (t) RESTRICTIONS ON BUSINESS ACTIVITIES. There is no judgment,
order,  decree,  writ or injunction binding upon the Company,  Synovics or their
respective Subsidiaries or, to the knowledge of the Company,  Synovics or any of
their respective  Subsidiaries,  threatened that has or could prohibit or impair
the  conduct  of their  respective  businesses  as  currently  conducted  or any
business  practice  of  the  Company,   Synovics  or  any  of  their  respective
Subsidiaries,  including the acquisition of property, the provision of services,
the hiring of  employees  or the  solicitation  of clients,  in each case either
individually or in the aggregate.

                  (u) EVENTS OF DEFAULT.  Except as disclosed in the SEC Filings
or forth on SCHEDULE  8(u) neither the Company nor Synovics has defaulted on any
debts or duties to pay money (including any guaranty).

9. COVENANTS OF THE COMPANY. The Company covenants and agrees as follows:

                  (a)  CONSOLIDATION,  MERGER AND SALE. The Company will not (i)
consolidate  or merge with or into (or permit any  subsidiary to  consolidate or
merge with or into) any other person,  or (ii) sell or otherwise  dispose of (or
permit any subsidiary to sell or otherwise dispose of) a material portion of its
property or assets in one or more transactions to, any other person or entity or
enter into (or permit any subsidiary to enter into) an agreement with respect to
any of the foregoing.

                  (b) RESTRICTED  PAYMENTS.  Except for any payments to Synovics
in the ordinary course of business or to satisfy Synovics' obligations under the
BOI  Facility (as defined  below) or Senior  Creditor  Indebtedness  (as defined
below),  the Company  will not, and will not permit any of its  subsidiaries  to
declare or pay any  dividends on, or make any other  distribution  or payment on
account  of, or redeem,  retire,  purchase  or  otherwise  acquire,  directly or
indirectly,  any equity interests of any class of the Company or any subsidiary,
whether now or hereafter outstanding,  or make any other distribution in respect
thereof,  either  directly  or  indirectly,  whether  in  cash,  property  or in
obligations of the Company or any of its subsidiaries.

                  (d) NOTICE OF QUALIFIED EQUITY  FINANCING.  At least three (3)
days prior to the closing of any Qualified Equity  Financing,  the Company shall
provide Payee with written notice of such projected closing date, specifying the
terms of the transaction,  including the proposed purchase price of the Series C
Preferred to be paid in such Qualified Equity Financing and the conversion price
thereof.  The Company shall promptly provide  telephonic  notice to Payee of any
adjournments or rescheduling of such projected closing date.

                  (d) CONVERTIBLE  NOTES. All Convertible  Notes shall be on the
same terms and shall be in  substantially  the same form.  All  payments  to the
holder of any Convertible Note


                                       11
<PAGE>

shall be made to all  holders  of  Convertible  Notes,  pro  rata,  based on the
aggregate principal amount plus accrued but unpaid interest  outstanding on such
Convertible Notes at such time.

                  (e) SENIOR  STATUS;  NO  ASSIGNMENT.  This Note is subordinate
only to the rights and remedies of Bank of India,  New York Branch ("BOI") under
that  certain  credit  facility of Ten Million  Five  Hundred  Thousand  Dollars
($10,500,000) between BOI and Synovics (the "BOI FACILITY") and ranks PARI PASSU
to Borrower's  outstanding  indebtedness  in the principal  amount of $1,500,000
plus accrued but unpaid interest ("SENIOR  CREDITOR  INDEBTEDNESS") to Princeton
Holdings Trust ("PHT") and 2133820 Ontario,  Inc. ("ONTARIO";  together with BOI
and PHT, the "SENIOR  CREDITORS").  Subject to the rights of the Senor Creditors
and except for Permitted Indebtedness,  the Company shall not, without the prior
written  consent of  Holders  holding a majority  of the  aggregate  outstanding
principal amount of the Convertible  Notes incur or otherwise become liable with
respect  to any  Indebtedness  that  would  rank  senior  or PARI  PASSU  to the
Convertible Notes in order of payment.

                  (f) DEFAULT NOTICE. The Borrower covenants and agrees with the
Holder that, so long as any amount  remains unpaid on the Note, (i) the Borrower
shall deliver to the Holder,  promptly after the Borrower shall obtain knowledge
of the occurrence of any Event of Default (as hereinafter  defined) or any event
which with notice or lapse of time or both would  become an Event of Default (an
Event of Default or such other event  being a  "DEFAULT"),  a notice  specifying
that such  notice is a "NOTICE  OF  DEFAULT"  and  describing  such  Default  in
reasonable  detail,  and,  in such  Notice of Default or as soon  thereafter  as
practicable,  a description  of the action the Borrower has taken or proposes to
take with respect thereto,  (ii) the Borrower will not create, incur, assume, or
permit  to exist  any Lien  (as  defined  below)  on or with  respect  to any of
Borrower's  properties  except for Permitted Liens (as defined  below),  and the
Borrower  will  notify the Holder in writing at least ten (10) days prior to the
consummation  of any  transaction  resulting  in a Change of Control (as defined
below).

                  (g) TAX  ELECTIONS.  Neither the Borrower  nor Synovics  shall
make or authorize any person to make an election to have the Borrower classified
or taxed as a  corporation  for federal  income tax  purposes or any  applicable
state or local income or franchise tax purposes.

                  (h)  AUTHORIZATION  &  ISSUANCE  OF  SHARES.   Synovics  shall
authorize  and issue the  Series B Shares  as soon as  possible  but in no event
later than ten (10) days following the Issuance Date.

10.  EVENTS OF DEFAULT.  If any of the  following  events takes place before the
Maturity Date (each,  an "EVENT OF DEFAULT"),  Holders holding a majority of the
aggregate  outstanding principal amount of the Convertible Notes at their option
may declare all  principal  of and accrued and unpaid  interest  thereon and all
other amounts payable under the Convertible  Notes  immediately due and payable;
PROVIDED, HOWEVER, that the Convertible Notes shall automatically become due and
payable without any declaration in the case of an Event of Default  specified in
clauses (g) or (h) below:

                  (a) A default in the payment of the  Principal  or any accrued
interest on this Note, when and as the same shall become due and payable,  which
default is not cured  within  three (3) Business  Days  following  such Event of
Default.


                                       12
<PAGE>


                  (b) A default in the  performance,  or a breach,  of any other
covenant or  agreement  of the  Borrower in this Note or any of the  Transaction
Documents and continuance of such default or breach for a period of fifteen (15)
days  after  receipt of notice  from the Holder as to such  default or breach or
after the Borrower had or should have had knowledge of such default or breach.

                  (c) A default in the performance, or a breach, of any covenant
or other  agreement of the  Borrower  contained  in loan  documents  executed in
connection with the BOI Facility.

                  (d) Any representation, warranty, or certification made by the
Borrower pursuant to this Note or the Transaction  Documents shall prove to have
been false or misleading as of the date made in any material respect.

                  (e) A final  judgment or judgments for the payment of money in
excess of $500,000  in the  aggregate  shall be rendered by one or more  courts,
administrative or arbitral tribunals or other bodies having jurisdiction against
the Borrower and the same shall not be  discharged  (or  provision  shall not be
made for such discharge),  or a stay of execution thereof shall not be procured,
within 60 days from the date of entry thereof and the Borrower shall not, within
such 60-day  period,  or such longer period  during which  execution of the same
shall have been stayed,  appeal therefrom and cause the execution  thereof to be
stayed during such appeal.

                  (f)  The  entry  of  a  decree  or  order  by a  court  having
jurisdiction  adjudging  the  Borrower  bankrupt or  insolvent,  or  approving a
petition seeking reorganization,  arrangement,  adjustment, or composition of or
in respect of the Borrower,  under federal  bankruptcy  law, as now or hereafter
constituted, or any other applicable federal or state bankruptcy, insolvency, or
other similar law, and the  continuance of any such decree or order unstayed and
in effect for a period of 60 days;  or the  commencement  by the  Borrower  of a
voluntary case under federal bankruptcy law, as now or hereafter constituted, or
any other applicable federal or state bankruptcy,  insolvency,  or other similar
law,  or the  consent  by it to the  institution  of  bankruptcy  or  insolvency
proceedings  against  it, or the filing by it of a petition or answer or consent
seeking  reorganization  or relief  under  federal  bankruptcy  law or any other
applicable  federal  or state  law,  or the  consent by it to the filing of such
petition or to the  appointment of a receiver,  liquidator,  assignee,  trustee,
sequestrator,  or similar official of the Borrower or of any substantial part of
its property, or the making by it of an assignment for the benefit of creditors,
or the taking of  corporate  action by the Borrower in  furtherance  of any such
action.

                  (g)  The  Company,  or its  parent,  Synovics,  or  any  other
subsidiary of Synovics,  (i) is generally  not paying,  or admits in writing its
inability to pay,  its debts as they become due,  other than (A) as disclosed in
the SEC Filings;  and (B) as arising out of a promissory  note in the  principal
amount of $1,500,000  held by the Senior  Creditors,  (ii) files, or consents by
answer or  otherwise  to the  filing  against  it of, a  petition  for relief or
reorganization  of  arrangement  or  any  other  petition  in  bankruptcy,   for
liquidation or to take advantage of any bankruptcy, insolvency,  reorganization,
moratorium or other similar law or any  jurisdiction,  (iii) makes an assignment
for the benefit of creditors,  (iv) consents to the  appointment of a custodian,



                                       13
<PAGE>

receiver,  trustee or other  officer with  similar  powers with respect to it or
with respect to any  substantial  part of its property,  (v) is  adjudicated  as
insolvent or to be liquidated, or (vi) takes corporate action for the purpose of
any of the foregoing.

                  (h)  A  default   occurs  in  the  payment  of  any   material
indebtedness of the Borrower or Synovics,  or any subsidiary of Synovics,  which
is not cured  pursuant  to the terms under  which such debt was  incurred  after
demand  thereof  other  than (A) as  disclosed  in the SEC  Filings;  and (B) as
arising out of the Senior Creditor Indebtedness.

                  (i) The occurrence of a Change of Control. "CHANGE OF CONTROL"
shall mean (i) a sale or transfer of all or  substantially  all of the assets of
the Borrower; (ii) a merger of the Borrower into another entity (with such other
entity being the surviving entity) or other form of corporate  reorganization of
the Borrower in which  outstanding  interests in the Borrower are  exchanged for
securities or other consideration  (other than a mere re-domiciling  transaction
or change of corporate entity); or (iii) any other transaction by which Synovics
does not hold, directly or indirectly, at least a majority of the voting control
of the Borrower.

                  (j)  An  attachment   or  execution  is  levied   against  any
substantial part of Company's assets that is not released within 30 days;

                  (k) Company dissolves, liquidates or ceases business activity,
or transfers any major  portion of its assets other than in the ordinary  course
of business; or

                  (l) the occurrence of any Material  Adverse  Effect  resulting
from any Restatement.

11.  REMEDIES  UPON  DEFAULT.  (a) Upon the  occurrence  of an Event of  Default
referred to in Sections 10(g) or (h), the Principal  amount then outstanding of,
and the accrued interest on, this Note shall  automatically  become  immediately
due and payable without  presentment,  demand,  protest, or other formalities of
any kind,  all of which are hereby  expressly  waived by the Borrower.  Upon the
occurrence  of an Event of Default  referred to other than in Sections  10(g) or
(h),  the  Holder,  by five (5)  Business  Days  notice in writing  given to the
Borrower  (during which time, the Borrower may cure such Event of Default),  may
declare the entire  principal  amount then  outstanding of, and accrued interest
on, this Note to be due and payable  immediately,  and upon any such declaration
the same shall become and be due and payable immediately,  without presentation,
demand,  protest,  or other  formalities of any kind, all of which are expressly
waived by the Borrower.

                  (b) Upon the  occurrence  of an Event of  Default,  the Holder
shall  seek  satisfaction  of any  remedy  sought for an Event of Default in the
following  order of priority:  first from the assets of the Borrower as a senior
unsecured  creditor,  second from the Series B Shares and third from the Pledge.
Except as set forth in this Section 11(b),  no remedy herein  conferred upon the
Holder is intended to be  exclusive  of any other remedy and each and every such
remedy shall be cumulative  and shall be in addition to every other remedy given
hereunder  or now or  hereafter  existing  at law or in equity or by  statute or
otherwise.



                                       14
<PAGE>

                  (c) The Holder may institute  such actions or  proceedings  in
law or equity, or other appropriate proceedings,  as it shall deem expedient for
the  protection of its rights and may  prosecute and enforce its claims  against
all assets of the Borrower in accordance  with this Note, and in connection with
any such action or proceeding  shall pursuant to the terms herein be entitled to
receive  from the Borrower  payment of the  outstanding  Principal  plus accrued
interest to the date of payment  plus  reasonable  and  accountable  expenses of
enforcement or collection,  including,  without limitation,  attorneys' fees and
expenses.

12.      DEFINITIONS.

                  "2006 NOTES" means the $3,345,000 in convertible  bridge notes
offered to investors in a private placement transaction.

                  "ASIA PACIFIC NOTE" means the  convertible  bridge note in the
principal  amount of  $1,500,000  issued by Synovics to Asia Pacific  Investment
Holdings Limited.

                  "BUSINESS  DAY" means a day (other  than a Saturday or Sunday)
on which  banks  generally  are open in New York,  New York for the  conduct  of
substantially all of their activities.

                  "CONVERTIBLE NOTEHOLDER" with respect to any Convertible Note,
means at any time each  Person  then the record  owner  hereof and  "Convertible
Noteholders" means all of such Convertible Noteholders collectively.

                  "EQUITY  FINANCING" means the issuance of stock of the Company
and/or  securities  convertible  into  stock to one or more  investors  for cash
following the date of issuance of this Convertible Note.

                  "INDEBTEDNESS"  shall  mean all  obligations,  contingent  and
otherwise,  that  should,  in  accordance  with  generally  accepted  accounting
principles of the United States  consistently  applied,  be classified  upon the
Borrower's  balance sheet as liabilities,  but in any event  including,  without
limitation,  liabilities  secured by any mortgage on property  owned or acquired
subject to such  mortgage,  whether or not the liability  secured  thereby shall
have been assumed, and also including,  without limitation,  (i) all guaranties,
endorsements  and other  contingent  obligations,  in respect of Indebtedness of
others,  whether or not the same are or should be so  reflected  in said balance
sheet, except guaranties by endorsement of negotiable instruments for deposit or
collection or similar  transactions  in the ordinary course of business and (ii)
the  present  value of any  lease  payments  due  under  leases  required  to be
capitalized in accordance  with  applicable  Statements of Financial  Accounting
Standards,  determined in  accordance  with  applicable  Statements of Financial
Accounting Standards.

                  "LIEN" shall mean, with respect to any property,  any security
interest,  mortgage, pledge, lien, claim, charge or other encumbrance in, of, or
on such property or the income therefrom,  including,  without  limitation,  the
interest of a vendor or lessor under a conditional sale agreement, capital lease
or other  title  retention  agreement,  or any  agreement  to provide any of the
foregoing, and the filing of any financing statement or similar instrument under
the Uniform Commercial Code or comparable law of any jurisdiction.



                                       15
<PAGE>

                  "PERMITTED INDEBTEDNESS" shall mean and include the following:
(i) indebtedness to trade creditors incurred in the ordinary course of business,
(ii)   indebtedness   secured  by  Permitted  Liens,   (iii)  any  refinancings,
modifications,  amendments  and  restatements  of the  BOI  Facility  or  Senior
Creditors  Indebtedness,  (iv) a revolving or factoring credit facility of up to
$5,000,0000 ("REVOLVING FACILITY").

                  "PERMITTED  LIENS" shall mean and include the  following:  (i)
Liens for taxes or other  governmental  charges  not at the time  delinquent  or
thereafter  payable  without  penalty or being  contested  in good faith and for
which  adequate  reserves  have  been set  aside  on its  books;  (ii)  Liens of
carriers,  warehousemen,   mechanics,   materialmen,   repairmen,  vendors,  and
landlords  incurred in the  ordinary  course of business for sums not overdue by
more  than  sixty  (60)  days or being  contested  in good  faith  and for which
adequate  reserves  have  been set  aside on its  books;  (iii)  deposits  under
workers'  compensation,  unemployment  insurance and social  security laws or to
secure the performance of bids, tenders, contracts (other than for the repayment
of borrowed  money) or leases,  or to secure  statutory  obligations  or surety,
appeal bonds or performance or to secure indemnity, performance or other similar
bonds in the ordinary course of business;  (iv) Liens securing obligations under
a capital lease if such Liens do not extend to property  other than the property
leased under such capital lease;  (v) Liens upon any equipment  acquired or held
by the Borrower to secure the purchase price of such  equipment or  indebtedness
incurred  solely for the purpose of financing the acquisition of such equipment,
so long as such Lien extends only to the equipment financed, and any accessions,
replacements,  substitutions and proceeds (including insurance proceeds) thereof
or thereto and any  extension,  renewal or  replacement  thereof;  (vi) Liens in
favor of the Bank of India,  New York Branch with respect to its credit facility
to Synovics in the principal sum of  $10,500,000 ; (vii) liens arising solely by
virtue of any statutory  provisions related to banker's liens,  rights of setoff
or similar  rights and remedies as to deposit  accounts or the funds  maintained
with a creditor  depository  institution (viii) liens arising out of a Revolving
Facility.

                  "PERSON" means any person or entity of any nature  whatsoever,
specifically including,  without limitation, an individual, a firm, a company, a
corporation,  a  partnership,  a  limited  liability  company,  a trust or other
entity.

                  "PLACEMENT AGENT" means Axiom Capital Management, Inc.

                  "QUALIFIED  EQUITY  FINANCING"  shall mean an Equity Financing
resulting in cash proceeds to the Company of not less than $9,000,000 (including
100% of the principal  amount of the Convertible  Notes and the principal amount
of 2006 Notes that opt to convert  into Series C Preferred  in  connection  with
such Equity Financing).

                  "RIGHTS  AGREEMENT"  shall mean that certain Rights  Agreement
effective  as of  September  8, 2006  between  Synovics  and  Continental  Stock
Transfer & Trust Company.

                   "SUBSIDIARIES" shall mean the subsidiaries of the Company and
Synovics, as applicable, set forth in Schedule 8(a).

13. EXPENSES OF  ENFORCEMENT,  ETC. The Company agrees to pay all reasonable and
accountable  fees and  expenses  incurred  by the Payee in  connection  with the
negotiation,



                                       16
<PAGE>

execution and delivery of this  Convertible  Note  (including the reasonable and
accountable fees and expenses of counsel to the placement agent for the Payees).
The Company  agrees to pay all  reasonable  and  accountable  fees and  expenses
incurred by the Payee in connection with any amendments, modifications, waivers,
extensions,  renewals,  renegotiations or "workouts" of the provisions hereof or
incurred by the Payee in connection  with the  enforcement  or protection of its
rights in connection  with this  Convertible  Note,  or in  connection  with any
pending or  threatened  action,  proceeding,  or  investigation  relating to the
foregoing, including but not limited to the reasonable fees and disbursements of
counsel  for the  Payee.  The  Company  agrees  to  indemnify  the Payee and its
directors,  managers,  affiliates,  partners,  members, officers,  employees and
agents against,  and agrees to hold the Payee and each such person and/or entity
harmless  from, any and all losses,  claims,  damages,  liabilities  and related
expenses,  including  reasonable  and  accountable  counsel  fees and  expenses,
incurred by, or asserted  against,  the Payee or any such person  and/or  entity
arising  out  of,  in  any  way  connected  with,  or as a  result  of  (i)  the
consummation of the loan evidenced by this  Convertible  Note and the use of the
proceeds  thereof or (ii) any claim,  litigation,  investigation  or proceedings
relating  to any of the  foregoing,  whether or not the Payee or any such person
and/or entity is a party thereto other than any loss, claim,  damage,  liability
or related expense  incurred or asserted against the payee or any such person on
account of the payee's or such person's gross negligence or willful misconduct.

14.  AMENDMENT AND WAIVER.  The provisions of this  Convertible  Note may not be
modified,  amended or waived,  and the  Company  may not take any action  herein
prohibited,  or omit to perform any act herein  required to be  performed by it,
without the written consent of the Holder.

15. REMEDIES NOT WAIVED. No course of dealing between the Borrower and the Payee
or any delay on the part of the Payee in exercising any rights  hereunder  shall
operate as a waiver of any right of the Payee.

16. ASSIGNMENTS.  Subject to applicable law, the Payee may assign,  participate,
transfer  or  otherwise  convey this  Convertible  Note and any of its rights or
obligations  hereunder or interest  herein to any  affiliate of Payee and to any
other Person that the Borrower  consents to (such consent not to be unreasonably
withheld or delayed),  and this  Convertible  Note shall inure to the benefit of
the Payee's  successors  and assigns.  The Borrower shall not assign or delegate
this Convertible Note or any of its liabilities or obligations hereunder.

17.  HEADINGS.  The headings of the sections and paragraphs of this  Convertible
Note are  inserted  for  convenience  only and do not  constitute a part of this
Convertible Note.

18.  SEVERABILITY.  If any provision of this Convertible Note is held invalid or
unenforceable  by any court of competent  jurisdiction,  the other provisions of
this  Convertible  Note will remain in full force and effect.  Any  provision of
this Convertible Note held invalid or unenforceable  only in part or degree will
remain in full force and effect to the extent not held invalid or unenforceable.

19. CANCELLATION. After all principal, premiums (if any) and accrued interest at
any  time  owed on this  Convertible  Note  have  been  paid  in  full,  or this
Convertible Note has been



                                       17
<PAGE>


converted  this  Convertible  Note  will  be  surrendered  to  the  Company  for
cancellation and will not be reissued.

20.  MAXIMUM LEGAL RATE. If at any time an interest  rate  applicable  hereunder
exceeds the maximum  rate  permitted  by law,  such rate shall be reduced to the
maximum rate so permitted by law.

21. PLACE OF PAYMENT AND NOTICES.  Payments of principal  and interest are to be
delivered  to  the  Convertible  Noteholder  of  this  Convertible  Note  at the
following  address:  ________________________________________,  or at such other
address as such Convertible  Noteholder has specified by prior written notice to
the Company.  No notice shall be deemed to have been  delivered  until the first
Business Day following actual receipt thereof at the foregoing address.

22.  WAIVER OF JURY TRIAL.  THE PAYEE AND THE  BORROWER  EACH HEREBY  WAIVES ANY
RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY  LITIGATION  DIRECTLY  OR
INDIRECTLY  ARISING OUT OF, UNDER OR IN CONNECTION  WITH THIS  CONVERTIBLE  NOTE
AND/OR THE TRANSACTIONS CONTEMPLATED HEREUNDER.

23.  SUBMISSION TO JURISDICTION.  Any legal action or proceeding with respect to
this  Convertible  Note may be brought in the courts of the State of New York or
of the United  States of America  sitting in New York County,  and, by execution
and delivery of this Convertible Note, the Company hereby accepts for itself and
in respect of its property,  generally and unconditionally,  the jurisdiction of
the aforesaid courts. The Company hereby irrevocably  waives, in connection with
any such action or proceeding, any objection, including, without limitation, any
objection  to the  laying  of  venue  or  based  on the  grounds  of  forum  non
conveniens,  which they may now or  hereafter  have to the  bringing of any such
action or  proceeding in such  respective  jurisdictions.  Nothing  herein shall
affect the right of the Payee to serve process in any other manner  permitted by
law or to commence legal proceedings or otherwise proceed against the Company in
any other jurisdiction.

24.  GOVERNING  LAW.  ALL  ISSUES AND  QUESTIONS  CONCERNING  THE  CONSTRUCTION,
VALIDITY,  ENFORCEMENT  AND  INTERPRETATION  OF THIS  CONVERTIBLE  NOTE SHALL BE
GOVERNED BY, AND  CONSTRUED  IN  ACCORDANCE  WITH,  THE LAWS OF THE STATE OF NEW
YORK,  WITHOUT  GIVING  EFFECT TO ANY CHOICE OF LAW OR  CONFLICT OF LAW RULES OR
PROVISIONS  (WHETHER  OF THE STATE OF NEW YORK OR ANY OTHER  JURISDICTION)  THAT
WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE
OF NEW YORK.




                                       18
<PAGE>


                  IN WITNESS WHEREOF, the parties have executed and the Company
has delivered this Convertible Note on the date first written above.


                                  BORROWERS:

                                  KIRK PHARMACEUTICALS, LLC


                                  By:
                                     -----------------------------------
                                  Name:
                                  Title:


                                  PLEDGOR:

                                  By:
                                     -----------------------------------
                                  Name: Ronald H. Lane

<PAGE>


                                    EXHIBIT A
                                    ---------

                              LANE PLEDGE AGREEMENT
                              ---------------------

                                PLEDGE AGREEMENT
                                ----------------

                  THIS PLEDGE AGREEMENT (this  "AGREEMENT") dated as of July __,
2007 (the  "EFFECTIVE  DATE"),  is by and between Ronald H. Lane (the "PLEDGOR")
and Axiom Capital Management, Inc. ("AXIOM").

                                R E C I T A L S:
                                - - - - - - - -

                  WHEREAS,  investors  (the "SECURED  PARTIES") of a bridge note
offering made loans to Kirk  Pharmaceuticals,  LLC (the "COMPANY" or "BORROWER")
pursuant to a Convertible Promissory Note in the form attached hereto as EXHIBIT
A (the "NOTE");

                  WHEREAS,  Axiom is  acting  as agent  of the  Secured  Parties
(Axiom  acting as such agent and any  successor or successors to Axiom acting in
such capacity being hereinafter referred to as the "AGENT");

                  WHEREAS,  Pledgor  has  agreed to pledge  the  Collateral  (as
defined below) to the Agent as security for Borrower's payment obligations under
the Note.

                  NOW THEREFORE, in consideration of the premises and other good
and  valuable  consideration,  the receipt and  sufficiency  of which are hereby
acknowledged, the parties hereto agree as follows:

                                    ARTICLE I

                          SECURITY INTEREST AND PLEDGE
                          ----------------------------

                  Section 1.01.  SECURITY  INTEREST AND PLEDGE.  Pledgor  hereby
pledges  and  grants to Agent for the  benefit  of the  Secured  Parties a first
priority  security  interest in the  following  property  (such  property  being
hereinafter sometimes called the "COLLATERAL"):

                  (a) all of  Pledgor's  right,  title  and  interest  in and to
2,000,000   common   shares,   par  value   $0.001   per  share,   of   Synovics
Pharmaceuticals, Inc. (the "SYNOVICS STOCK"); and

                  (b) all proceeds of the foregoing  Synovics  Stock  including,
without limitation,  distributions,  dividends, stock dividends, securities, and
other  property,  rights,  and interests that Pledgor is at any time entitled to
receive on account of the same.

                  Section  1.02.  OBLIGATIONS;  DELIVERY  OF  CERTIFICATES.  The
Collateral shall secure the following obligations, indebtedness, and liabilities
(all such obligations, indebtedness, and liabilities being hereinafter sometimes
called the  "OBLIGATIONS"):  the obligations and  indebtedness of Pledgor to the
Secured  Parties  evidenced by the Note; all costs and expenses

<PAGE>

incurred by the Secured Parties to preserve and maintain the Collateral, collect
the  obligations  herein  described,   and  enforce  this  Agreement;   and  all
extensions,  renewals,  and  modifications  of  any  of  the  foregoing.  If the
securities   referenced  in  Section  1.01(a)  above  are   certificated,   such
certificates  shall be  delivered by Pledgor to the Agent for the benefit of the
Secured Parties on the Effective Date.

                                   ARTICLE II

                         REPRESENTATIONS AND WARRANTIES
                         ------------------------------

                  Pledgor represents and warrants to the Secured Parties that:

                  Section  2.01.  TITLE.  Pledgor  owns,  and  with  respect  to
Collateral  acquired  after  the date  hereof,  Pledgor  will own,  legally  and
beneficially,  the  Collateral  free and clear of any lien,  security  interest,
pledge,  claim,  or other  encumbrance or any right or option on the part of any
third  person to  purchase  or  otherwise  acquire  the  Collateral  or any part
thereof,  except for the security interest granted hereunder.  The Collateral is
not subject to any  restriction on transfer or assignment  except for compliance
with applicable  federal and state  securities laws and regulations  promulgated
thereunder.  Pledgor  has the  unrestricted  right to pledge the  Collateral  as
contemplated  hereby. All of the Collateral has been duly and validly issued and
is fully paid and nonassessable.

                  Section 2.02. FIRST PRIORITY PERFECTED SECURITY INTEREST. This
Agreement  creates in favor of the Secured  Parties a first  priority  perfected
security interest in the Collateral.

                                   ARTICLE III

                       AFFIRMATIVE AND NEGATIVE COVENANTS
                       ----------------------------------

                  Pledgor  covenants  and  agrees  with the Agent that until the
Obligations  are satisfied and performed in full or this  Agreement is otherwise
terminated:

                  Section  3.01.  DELIVERY.  Prior to or  concurrently  with the
execution and delivery of this Agreement, Pledgor shall deliver to the Agent all
certificate(s)  identified in Section  1.01(a)  hereof,  accompanied  by undated
stock powers duly executed in blank.

                  Section 3.02. ENCUMBRANCES.  Pledgor shall not create, permit,
or suffer to exist, and shall defend the Collateral against,  any lien, security
interest,  or other encumbrance on the Collateral except the pledge and security
interest of Secured Parties hereunder,  and shall defend Pledgor's rights in the
Collateral and Secured Parties' security interest in the Collateral  against the
claims of all persons and entities.

                  Section  3.03.  SALE OF  COLLATERAL.  Pledgor  shall not sell,
assign,  pledge or otherwise  dispose of or encumber the  Collateral or any part
thereof without the prior written consent of the Agent.


                                        2
<PAGE>

                  Section 3.04. FURTHER ASSURANCES. At any time and from time to
time, upon the request of the Agent, and at the sole expense of Pledgor, Pledgor
shall promptly  execute and deliver all such further  instruments  and documents
and take such  further  action  as Agent  may deem  necessary  or  desirable  to
preserve and perfect Secured  Parties'  security  interest in the Collateral and
carry out the  provisions  and purposes of this  Agreement.  Pledgor  authorizes
Agent to file a financing statement covering the Collateral or any part thereof.
In addition,  Pledgor shall,  at the Agent's  request,  execute and deliver such
further  documents and take such further  actions as the Agent shall  reasonably
request  to  perfect  and  maintain  the  Company's  security  interest  in  the
Collateral,  or in any  part  thereof,  or  sell  or  otherwise  dispose  of the
Collateral, or any part thereof.


                                   ARTICLE IV

                           RIGHTS OF AGENT AND PLEDGOR
                           ---------------------------

                  Section 4.01.  POWER OF ATTORNEY.  Pledgor hereby  irrevocably
constitutes and appoints Agent and any officer or agent thereof, with full power
of substitution,  as its true and lawful  attorney-in-fact with full irrevocable
power and  authority in the place and stead and in the name of Pledgor or in its
own name,  from time to time in Agent's  discretion,  to take any and all action
and to execute any and all documents and  instruments  which may be necessary or
desirable to accomplish the purposes of this Agreement and, without limiting the
generality of the foregoing, hereby gives Agent the power and right on behalf of
Pledgor and in its own name to do any of the following, without notice to or the
consent of Pledgor:

                  (i) to  demand,  sue for,  collect,  or receive in the name of
         Pledgor or in its own name,  any money or property at any time  payable
         or  receivable  on account of or in exchange for any of the  Collateral
         and,  in  connection   therewith,   endorse  checks,   notes,   drafts,
         acceptances,  money orders, or any other instruments for the payment of
         money under the Collateral;

                  (ii) to pay or discharge taxes, liens, security interests,  or
         other  encumbrances  levied  or  placed on or  threatened  against  the
         Collateral;

                  (iii) (A) to receive  payment of and  receipt  for any and all
         monies,  claims, and other amounts due and to become due at any time in
         respect of or arising  out of any  Collateral;  (B) to sign and endorse
         any proxies, stock powers, verifications,  notices, and other documents
         relating to the  Collateral;  (C) to commence and  prosecute  any suit,
         actions or  proceedings  at law or in equity to enforce any other right
         in  respect  of any  Collateral;  (D) to defend  any suit,  action,  or
         proceeding brought against Pledgor with respect to any Collateral;  (E)
         to  settle,  compromise,  or adjust  any suit,  action,  or  proceeding
         described above and, in connection  therewith,  to give such discharges
         or releases as Agent may deem  appropriate;  (F) to exchange any of the
         Collateral   for  other   property  upon  any  merger,   consolidation,
         reorganization,  recapitalization,  or other readjustment of the issuer
         thereof; (G) to sell, transfer, pledge, make any agreement with respect
         to or otherwise deal with any of the Collateral as fully and completely
         as though



                                        3
<PAGE>


         Agent were the absolute  owner thereof for all purposes,  and to do, at
         Agent's  option and  Pledgor's  expense,  at any time,  or from time to
         time,  all acts and things  which  Agent  deems  necessary  to protect,
         preserve,  or realize upon the Collateral and Secured Parties' security
         interest  therein;  and (H) to complete,  execute and file with the SEC
         one or more  notices of proposed  sale of  securities  pursuant to Rule
         144.

                  This power of attorney is a power coupled with an interest and
shall be  irrevocable.  Agent shall be under no duty to exercise or withhold the
exercise of any of the rights,  powers,  privileges,  and options  expressly  or
implicitly  granted to Agent in this Agreement,  and shall not be liable for any
failure to do so or any delay in doing so. Agent shall not be liable for any act
or  omission  or for any error of  judgment or any mistake of fact or law in its
individual  capacity  or in its  capacity  as  attorney-in-fact  except  acts or
omissions resulting from its willful misconduct,  bad faith or gross negligence.
This power of attorney is conferred on Agent  solely to protect,  preserve,  and
realize upon its security interest in the Collateral.

                  Section  4.02.  TERMINATION.  Upon the  payment in full of the
Obligations  this Agreement shall terminate,  and Agent shall forthwith  assign,
transfer,  and deliver to the Pledgor,  against its receipt, the Collateral then
held by it hereunder.

                                    ARTICLE V

                                     DEFAULT
                                     -------

                  Section  5.01.  EVENTS  OF  DEFAULT.  If  the  Borrower  shall
experience  an "EVENT OF  DEFAULT"  as such term is defined in Section 10 of the
Note, then the Parties have agreed that, for the purposes of this Agreement, the
Obligations shall become immediately due and payable.

                  Section 5.02.  RIGHTS AND REMEDIES.  Upon the occurrence of an
Event of  Default,  subject to Section  11(b) of the Note,  Agent shall have the
following rights and remedies:

                  (i)      Agent may direct the  Pledgor to sell the  Collateral
                           and deliver the proceeds to it to be applied  against
                           the  Obligations  or directly sell the  Collateral in
                           the name of the  Pledgor  and apply the  proceeds  of
                           such sale against the Obligations.

                  (ii)     In addition to all other rights and remedies  granted
                           to  Agent  in  this   Agreement   and  in  any  other
                           instrument  or  agreement  securing,  evidencing,  or
                           relating to the Obligations,  Agent shall have all of
                           the rights and remedies of a secured  party under the
                           Uniform  Commercial  Code as  adopted by the State of
                           New York.

                  (iii)    Agent may cause any or all of the Collateral  held by
                           it to be  transferred  into the  name of the  Secured
                           Parties  or the  name or names  of  Secured  Parties'
                           nominee or nominees.


                                        4
<PAGE>


                  (iv)     Pledgor hereby  acknowledges  and confirms that Agent
                           may be unable  to effect a public  sale of any or all
                           of the  Collateral by reason of certain  prohibitions
                           contained  in the U.S.  Securities  Act of  1933,  as
                           amended, and applicable state securities laws and may
                           be compelled  to resort to one or more private  sales
                           thereof to a restricted  group of purchasers who will
                           be  obligated  to agree to acquire  any shares of the
                           Collateral  for their  own  respective  accounts  for
                           investment  and not  with a view to  distribution  or
                           resale  thereof.  Pledgor  further  acknowledges  and
                           confirms  that any such  private  sale may  result in
                           prices or other  terms less  favorable  to the seller
                           than  if  such   sale   were  a  public   sale   and,
                           notwithstanding  such circumstances,  agrees that any
                           such  private  sale shall be deemed to have been made
                           in a commercially  reasonable manner, and Agent shall
                           be under no  obligation to take any steps in order to
                           permit the Collateral to be sold at a public sale.

                  Section 5.03. NO RIGHTS UNTIL EVENT OF DEFAULT. Until an Event
of Default  occurs  and is  continuing,  the Agent  shall have no right to vote,
sell, pledge, hypothecate, transfer, encumber or otherwise dispose of any of the
Collateral.

                                   ARTICLE VI

                                  MISCELLANEOUS
                                  -------------

                  Section  6.01.  EXPENSES.  Pledgor  agrees  to pay and to hold
Agent and  Secured  Parties  harmless  from and against all fees and all excise,
sales,  stamp,  and other taxes payable in connection with this Agreement or the
transactions contemplated hereby.

                  Section 6.02. NO WAIVER;  CUMULATIVE  REMEDIES.  No failure on
the part of the Agent to exercise and no delay in  exercising,  and no course of
dealing with respect to, any right,  power,  or privilege  under this  Agreement
shall operate as a waiver thereof,  nor shall any single or partial  exercise of
any right,  power,  or  privilege  under this  Agreement  preclude  any other or
further  exercise  thereof  or  the  exercise  of any  other  right,  power,  or
privilege. The rights and remedies provided for in this Agreement are cumulative
and not exclusive of any rights and remedies provided by law.

                  Section 6.03.  SUCCESSORS AND ASSIGNS. This Agreement shall be
binding  upon and inure to the benefit of Pledgor and Secured  Parties and their
respective heirs,  successors,  and assigns,  except that Pledgor may not assign
any of its rights or obligations  under this Agreement without the prior written
consent of the Agent.

                  Section 6.04.  AMENDMENT;  ENTIRE  AGREEMENT.  THIS  AGREEMENT
EMBODIES THE FINAL, ENTIRE AGREEMENT AMONG THE PARTIES HERETO AND SUPERSEDES ANY
AND ALL PRIOR  COMMITMENTS,  AGREEMENTS,  REPRESENTATIONS,  AND  UNDERSTANDINGS,
WHETHER  WRITTEN OR ORAL,  RELATING TO THE SUBJECT  MATTER HEREOF AND MAY NOT BE
CONTRADICTED OR VARIED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT



                                        5
<PAGE>


ORAL  AGREEMENTS  OR  DISCUSSIONS  OF THE  PARTIES  HERETO.  THERE  ARE NO  ORAL
AGREEMENTS  AMONG THE PARTIES  HERETO.  THE  PROVISIONS OF THIS AGREEMENT MAY BE
AMENDED OR WAIVED ONLY BY AN INSTRUMENT IN WRITING SIGNED BY THE PARTIES HERETO.

                  Section 6.05.  NOTICES.  All notices and other  communications
provided  for in this  Agreement  shall be given or made in  writing,  mailed by
certified  mail return  receipt  requested,  or hand  delivered  to the intended
recipient at the "Address for Notices" specified below its name on the signature
pages  hereof;  or, as to any party at such other address as shall be designated
by such  party in a notice  to the other  party  given in  accordance  with this
Section. Except as otherwise provided in this Agreement, all such communications
shall be deemed to have been duly given  when  personally  delivered  or, in the
case of a mailed notice, when duly deposited in the mails, in each case given or
addressed as aforesaid.

                  Section 6.06.  APPLICABLE LAW; VENUE; SERVICE OF PROCESS. This
Agreement  shall be governed by and construed in accordance with the laws of the
State of New York and the applicable laws of the United States of America.  This
Agreement  has been entered into in New York County,  New York,  and it shall be
deemed  performable for all purposes in New York County, New York. Any action or
proceeding  against  Pledgor under or in connection  with this  Agreement or any
other  instrument  or  agreement  securing,   evidencing,  or  relating  to  the
Obligations  or any part thereof may be brought in any state or federal court in
New York  County,  New York.  Pledgor  hereby  irrevocably  (i)  submits  to the
nonexclusive  jurisdiction of such courts,  and (ii) waives any objection it may
now or hereafter  have as to the venue of any such action or proceeding  brought
in such court or that such court is an inconvenient  forum.  Pledgor agrees that
service of process upon it may be made by certified or registered  mail,  return
receipt requested, at its address specified or determined in accordance with the
provisions of Section 6.05 of this  Agreement.  Nothing in this Agreement or any
other  instrument  or  agreement  securing,   evidencing,  or  relating  to  the
Obligations or any part thereof shall affect the right of Agent to serve process
in any other manner  permitted by law or shall limit the right of Agent to bring
any  action  or  proceeding  against  Pledgor  or  with  respect  to  any of the
Collateral in any state or federal court in any other  jurisdiction.  Any action
or proceeding by Pledgor  against Agent shall be brought only in a court located
in New York County, New York.

                  Section 6.07. COUNTERPARTS.  This Agreement may be executed in
counterparts,  each of which shall be deemed an original  agreement,  but all of
which  together  shall  constitute  one and the same  instrument.  Execution and
delivery of this Agreement by facsimile transmission  (including the delivery of
documents in Adobe PDF format) shall  constitute  execution and delivery of this
Agreement  for all  purposes,  with the same force and effect as  execution  and
delivery of an original manually signed copy hereof.

                  Section 6.08.  SEVERABILITY.  Any provision of this  Agreement
which is prohibited  or  unenforceable  in any  jurisdiction  shall,  as to such
jurisdiction,   be   ineffective   to  the   extent  of  such   prohibition   or
unenforceability   without   invalidating  the  remaining   provisions  of  this
Agreement,  and any such  prohibition or  unenforceability  in any  jurisdiction
shall  not  invalidate  or  render  unenforceable  such  provision  in any other
jurisdiction.



                                        6
<PAGE>

                  Section  6.09.  WAIVER OF JURY TRIAL.  TO THE  FULLEST  EXTENT
PERMITTED BY APPLICABLE LAW, PLEDGOR HEREBY IRREVOCABLY AND EXPRESSLY WAIVES ALL
RIGHT TO A TRIAL BY JURY IN ANY  ACTION,  PROCEEDING  OR  COUNTERCLAIM  (WHETHER
BASED UPON  CONTRACT,  TORT,  OR  OTHERWISE)  ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THE ACTIONS OF AGENT IN THE
NEGOTIATION, ADMINISTRATION, OR ENFORCEMENT THEREOF.

                  Section  6.10 No  Secured  Parties  shall  have  the  right to
institute any suit, action or proceeding in equity or at law for the foreclosure
or other  realization  upon any Collateral  subject to this Agreement or for the
execution of any trust or power hereof or for the appointment of a receiver,  or
for the enforcement of any other remedy under or upon this  Agreement;  it being
understood  and intended  that no one or more of the Secured  Parties shall have
any right in any manner whatsoever to affect,  disturb or prejudice the lien and
security  interest of this  Agreement  by its or their  action or to enforce any
right  hereunder,  and  that  all  proceedings  at law  or in  equity  shall  be
instituted,  had and  maintained by the Agent in the manner herein  provided for
the benefit of the Secured Parties.

                           [SIGNATURE PAGE TO FOLLOW]





                                        7
<PAGE>


                  IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first written above.

                              PLEDGOR:


                              By:
                                 ----------------------------------------------
                              Name: Ronald H. Lane


                              Address for Notices:


                              AGENT:
                              ------


                              By:
                                 ----------------------------------------------
                              Name:
                              Title:

                              Address for Notices:

<PAGE>

                                  Schedule 8(a)


1.  Kirk Pharmaceuticals, LLC
2.  Andapharm LLC
3.  Kirk Pharmaceuticals, Inc.
4.  Andapharm, Inc.
5.  LipoGenics, Inc.
6.  Bionutrics Health Products, Inc.
7.  Synovics Laboratories, Inc.
8.  Nutrition Technology Corporation
9.  InCon International Ltd.
10. Cosmedics, Inc.

<PAGE>

                                  Schedule 8(u)

Note in the principal amount of $250,000 issued to Princeton Holdings Trust.