**Exhibit
      10.15**





**UNITED
      STATES DISTRICT COURT**


**DISTRICT
      OF MASSACHUSETTS**











**)****IN
                RE VASO ACTIVE**
            **)**
            **Master
                Docket No. 04-10792-RCL****PHARMACEUTICALS,
                INC.**
            **)**
            **(Consolidated
                Derivative Action)****DERIVATIVE
                LITIGATION**
            **)****)**





**STIPULATION
      AND AGREEMENT OF SETTLEMENT**





This
      Stipulation and Agreement of Settlement (this “Stipulation”), dated as of
      September 21, 2005, is entered into by and among Plaintiffs Joseph Rosenkrantz
      and William Pomeroy, derivatively on behalf of nominal Defendant Vaso Active
      Pharmaceuticals, Inc. (“Vaso” or “the Company”), and Defendants BioChemics,
      Inc., John Masiz, Kevin J. Seifert, Stephen G. Carter, Bruce A. Shear, Brian
      J.
      Strasnick, William P. Adams, Robert E. Anderson, Gary Fromm and Joseph
      Frattaroli (“Defendants”). All parties to this Stipulation shall be collectively
      referred to as the “Parties.”




The
      Parties have reached an agreement to settle the shareholder derivative
      litigation styled *In
      re Vaso Active Pharmaceuticals, Inc. Derivative Litigation* ,
      pending
      in the United States District Court for the District of Massachusetts (the
      “Derivative Litigation”), on the terms and conditions set forth in this
      Stipulation, subject to Court approval. This Stipulation is intended by the
      Parties to fully, finally and forever resolve, release, discharge and settle
      any
      and all claims that have been or could have been brought in the Derivative
      Litigation or that relate in any way to the facts or allegations in the
      Derivative Litigation, including but not limited to, claims brought in the
      Delaware Court of Chancery under Civil Action No. 682-N (the “Delaware
      Derivative Litigation”), based on the same facts and circumstances alleged in
      the Massachusetts Derivative Litigation.









**I.**


**RECITALS**


WHEREAS:


A.  On
      or
      about April 20, 2004, Joseph Rosenkrantz (“Rosenkrantz”), derivatively on behalf
      of Vaso, brought suit against certain of the Defendants and Vaso in the United
      States District Court for the District of Massachusetts. On or about June 18,
      2004, William Pomeroy derivatively on behalf of Vaso, brought suit against
      certain of the Defendants and Vaso in the United States District Court for
      the
      District of Massachusetts.




B.  Both
      lawsuits were subsequently consolidated in the United States District Court
      for
      the District of Massachusetts, under Master Docket No. 04-10792-RCL, defined
      herein as the Derivative Litigation.




C.  The
      Plaintiffs filed
      an
      Amended Consolidated Derivative Complaint on March 7, 2005 asserting, among
      other things, claims for breach of fiduciary duties, abuse of control, gross
      mismanagement and unjust enrichment. Defendants filed their Answers to the
      Amended Consolidated Complaint on March 28, 2005 generally denying the
      allegations.




D.  All
      Defendants (as defined below) deny any wrongdoing, fault, liability or damage
      to
      Plaintiffs or Vaso, deny that they engaged in any wrongdoing, deny that they
      committed any violation of law, and deny that they acted improperly in any
      way.
      The Defendants further contend that (i) they acted properly at all times,
      discharging their duties with due care and in a manner believed in good faith
      to
      be in the best interests of Vaso, (ii) that they are not liable to Vaso or
      its
      shareholders because they performed their duties in compliance with applicable
      federal and state statutory and common law, including but not limited to the
      business judgment rule, and (iii) that the Derivative Litigation and the
      Delaware Derivative Litigation are without merit.






2




E.  On
      or
      about September 13, 2004, Douglas Weymouth, derivatively on behalf of Vaso,
      brought the Delaware Derivative Litigation against Defendants and Vaso based
      on
      the same facts and circumstances alleged in the Massachusetts Amended
      Consolidated Derivative Complaint.




F.  On
      or
      about November 10, 2004, the Delaware Derivative Action was stayed pending
      resolution of this Derivative Litigation.




G.  In
      view
      of the uncertainty and risk of the outcome of any litigation (especially complex
      derivative litigation), the difficulties and substantial distractions,
      especially distractions related to the ongoing operations of Vaso, burdens,
      expenses and length of time necessary to engage in discovery and defend the
      proceeding, possible summary judgment motions, a possible trial, possible
      post-trial motions and possible appeals, and to eliminate the distractions,
      risks, burdens and expenses of further litigation, the Defendants have agreed
      to
      settle the Derivative Litigation.




H.  Plaintiffs,
      by and through Plaintiffs’ Counsel, represent that they have conducted and
      completed extensive research and investigation relating to the claims and the
      underlying events and transactions alleged in the Derivative Litigation,
      including review and analysis of various public statements and filings made
      by
      Vaso and its senior officers with the Securities and Exchange Commission,
      analysts’ reports concerning Vaso, and press releases, news articles and other
      media reports concerning Vaso.




I.  Plaintiffs
      believe that the claims asserted in the Derivative Litigation have merit.
      However, Plaintiffs and Plaintiffs’ Counsel recognize and acknowledge the
      expense and length






3




of
      continued proceedings necessary to prosecute the Derivative Litigation against
      the Defendants through trial and appeal. Plaintiffs and Plaintiffs’ Counsel also
      have taken into account the uncertain outcome and the risk of any litigation,
      especially complex actions such as the Derivative Litigation, as well as the
      difficulties, expense and delays inherent in such litigation and the current
      financial condition of Vaso. Plaintiffs and Plaintiffs’ Counsel also are mindful
      of the inherent problems of proof of, and defenses to, the violations asserted
      in the Derivative Litigation, especially in light of the lack of direct evidence
      of fraud or bad faith on the part of any Defendant.




J.  The
      Parties have voluntarily agreed, after consultation with competent legal
      counsel, to settle the Derivative Litigation and put the Released Claims (as
      defined below) to rest, finally and forever. This Stipulation shall not be
      construed or deemed to be a concession by Plaintiffs of any infirmity in the
      claims asserted in the Derivative Litigation or as a concession by any or all
      of
      the Defendants of any wrongdoing, fault, liability or damage to Plaintiffs,
      to
      Vaso, or to any other person or entity, or any infirmity in any defense that
      any
      or all Defendants asserted or could have asserted.




K.  The
      Parties and their counsel believe that the settlement embodied in this
      Stipulation is fair, reasonable and adequate and in the best interests of Vaso
      and its stockholders.




NOW,
      THEREFORE, IT IS HEREBY STIPULATED AND AGREED by and among the Parties that,
      subject to Court approval, any and all claims that have been or could have
      been
      brought in the Derivative Litigation or that relate in any way to the facts
      or
      allegations in the Derivative Litigation, including but not limited to claims
      brought in the Delaware Derivative Litigation, shall be finally and fully
      compromised, settled and released as to each of the Defendants and Vaso, upon
      and subject to the terms and conditions of this Stipulation as
      follows.






4


**II.**


**DEFINITIONS**




1.  For
      purposes of this Stipulation, and in addition to the terms defined above, the
      following definitions apply:




a.  “Board”
      means the Board of Directors of Vaso.




b.  “Court”
      means the United States District Court for the District of Massachusetts.




c.  “Defendants”
      means nominal Defendant Vaso and Defendants BioChemics, Inc., John Masiz, Kevin
      J. Seifert, Stephen G. Carter, Bruce A. Shear, Brian J. Strasnick, William
      P.
      Adams, Robert E. Anderson, Gary Fromm and Joseph Frattaroli.




d.  “Future
      Changes” means those corporate governance changes set out in Article III of this
      Stipulation.




e.  “Plaintiffs”
      means Joseph Rosenkrantz and William Pomeroy, derivatively on behalf of
      Vaso.




f.  “Plaintiffs’
      Counsel” means George E. Barrett, Douglas S. Johnston, Jr. and Timothy L. Miles
      of Barrett, Johnston & Parsley and Jeffrey Fink of Robbins Umeda & Fink,
      LLP.




g.  “Released
      Claims” means collectively any and all claims, debts, demands, rights or causes
      of action or liabilities whatsoever (including, but not limited to, any claims
      for damages, interest, attorneys’ fees, expert or consulting fees, and any other
      costs, expenses or liability whatsoever), whether based on federal, state,
      local, statutory or common law or any other law, rule or regulation, whether
      fixed or contingent, accrued or unaccrued, liquidated or unliquidated, at law
      or
      in equity, matured or unmatured, whether derivative or individual in nature,
      whether asserted in federal or state court, arbitration or other forum domestic
      or foreign,








5




including
      both known claims and Unknown Claims (as defined herein) held at any point
      from
      the beginning of time to the date of final approval of this Stipulation, which
      have been or could have been asserted by Plaintiffs or any Vaso shareholder
      on
      Vaso’s behalf in the Derivative Litigation, the Delaware Derivative Litigation
      or in any forum, including but not limited to (i) the facts, matters,
      transactions, conduct, omissions or circumstances alleged, or which could have
      been alleged, in the Derivative Litigation, the Delaware Derivative Litigation
      or in any forum, and (ii) the defense or settlement of the Derivative Litigation
      or the Delaware Derivative Litigation; provided, however, that “Released Claims”
shall not be deemed to include any existing statutory or contractual
      indemnification rights and obligations between Defendants on one hand and Vaso
      on the other hand, nor to include any existing claims that Vaso or the
      Defendants may have against Vaso’s former attorneys.




h.  “Released
      Parties” means the Defendants, including nominal Defendant Vaso, and each of
      their respective present, former and future parents, subsidiaries, divisions,
      affiliates, employees, members, shareholders, partners, partnerships,
      principals, officers, directors, attorneys, advisors, trustees, administrators,
      auditors, accountants, fiduciaries, consultants, representatives, and agents
      of
      each of them, and the predecessors, estates, heirs, executors, trusts, trustees,
      administrators, successors and assigns and any person or entity which is or
      was
      related to or affiliated with any of the foregoing or in which any of the
      foregoing persons and entities has or had a controlling interest and the present
      and former employees, members, shareholders, partners, partnerships, principals,
      officers and directors, attorneys, advisors, trustees, administrators,
      fiduciaries, consultants, representatives, accountants and auditors, insurers,
      and agents of each of them.






6




i.  “Settlement”
      means the settlement of the Derivative Litigation agreed to by and among the
      Parties and embodied in this Stipulation.




j.  “Stipulation”
      means this Stipulation and Agreement of Settlement.




k.  “Unknown
      Claims” means any and all Released Claims that Plaintiffs do not know or suspect
      to exist in their favor upon release of the Released Claims which, if known
      by
      any of them, may have affected their decision with respect to the Settlement.
      With respect to any and all Released Claims, the Parties stipulate and agree
      that Plaintiffs expressly waive, and by operation of the Final Judgment of
      Dismissal with Prejudice, shall be deemed to have waived, any and all
      provisions, rights and benefits conferred by any law, rules or regulations
      of
      any state or territory of the United States or any other country, or principle
      of common or civil law, that in any way would restrict or limit the scope of
      this Stipulation whether such restriction and/or limitation is similar,
      comparable, or equivalent to Cal. Civ. Code § 1542, which provides:




A
      GENERAL
      RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT
      TO
      EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY
      HIM
      MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR .





Plaintiffs
      acknowledge that the inclusion of Unknown Claims in the definition of Released
      Claims was separately bargained for and was a key element of the
      Settlement.




l.  "Delaware
      Derivative Counsel" means William B. Federman of Federman & Sherwood and
      Joseph A. Rosenthal of Rosenthal, Monhait, Gross & Goddess.




k.  "Delaware
      Derivative Plaintiffs" means Douglas Weymouth, derivatively on behalf of
      Vaso.






7








**III.**


**CORPORATE
      GOVERNANCE CHANGES**




1.  Vaso
      will
      be implementing, upon final approval by the Court and dismissal of the
      Derivative Litigation and the Delaware Derivative Litigation and as soon as
      practical thereafter, or in certain instances previously has implemented,
      certain corporate governance changes as a direct and substantial result of
      the
      prosecution of the Derivative Litigation. These corporate governance changes,
      discussed in paragraph 2 of this Article III, shall be implemented by and
      applicable to the Board.




2.  The
      following corporate governance changes represent future changes that will be
      implemented as soon as practical, but in no event sooner than approval of this
      Stipulation by the Court and dismissal with prejudice of the Derivative
      Litigation and the Delaware Derivative Litigation, by Vaso as a direct and
      substantial result of the prosecution and/or settlement of the Derivative
      Litigation:




A.  The
      Board
      of Directors





1.  Unless
      otherwise specified herein, at least one-half of the Board and two-thirds of
      all
      Committees shall be comprised of “independent directors,” as described
      herein.





B.  Director
      Independence





The
      Board’s standard for independence shall be the standard used by the American
      Stock Exchange in determining independence of directors on Audit Committees.
      To
      be deemed “independent” in any calendar year, a director will have to satisfy
      the following qualifications. He or she:





1.  Has
      not
      been employed by the Company or its subsidiaries or affiliates in an executive
      capacity within the last five calendar years;





2.  Has
      not
      received, during the current calendar year or any of the three immediately
      preceding calendar years, remuneration, directly or indirectly, other than
      de
      minimis remuneration, as a result of service as, or being affiliated with an
      entity that serves as (a) an advisor, consultant, or legal counsel to the
      Company or to a member of the Company’s senior management; (b) except as
      provided herein, a significant supplier of the Company; or (c) except as
      provided herein, a significant customer of the Company;






8





3.  Has
      no
      personal service contract(s) with the Company, or any member of the Company’s
      senior management;





4.  Is
      not an
      employee or officer with a not-for-profit entity that receives significant
      contributions from the Company;





5 *.*  During
      the current calendar year or any of the three immediate preceding calendar
      years, has not had any business relationship with the Company for which the
      Company has been required to make disclosure under Regulation S-K of the SEC,
      other than for service as a director or for which relationship no more than
      de
      minimis remuneration was received in any one such year;





6.  Is
      not
      employed by a public company at which an executive officer of the Company serves
      as a director;





7.  Has
      not
      had any of the relationships described in subsections 1-6 above with any
      affiliate of the Company;





8.  Is
      not a
      member of the immediate family of any person described in
      subsections


1-4
      above;





9.  Is
      not
      employed as an executive of another entity where any of the Company’s executives
      serve on that entity’s Compensation Committee; and





10.  Does
      not
      have beneficial ownership interest of five percent or more in an entity (other
      than BioChemics, Inc. and suppliers, distributors and sales agents) that has
      received remuneration, other than de minimis remuneration, from the Company,
      its
      subsidiaries, or affiliates. De minimis remuneration is defined as (a) direct
      remuneration of $60,000 or less received from the Company, its subsidiaries,
      or
      affiliates during a calendar year (other than compensation); or (b) indirect
      remuneration paid to an entity if such remuneration does not exceed the lesser
      of $5 ** million
      or one percent of the gross revenues of the entity and did not directly result
      in an increase in the compensation received by the director from that
      entity.





C.  Responsibilities
      of the Independent Directors





1.  The
      independent directors shall meet separately from the rest of the Board of
      Directors at least once a year.





2.  At
      the
      inaugural meeting of the independent directors and at the annual meeting of
      the
      independent directors, the independent directors shall elect a Lead Independent
      Director.





3.  The
      Lead
      Independent Director shall be responsible for coordinating the activities of
      the
      independent directors. In addition to the duties of all Board members (which
      shall not be limited or diminished by the Lead Independent Director’s role), the
      specific responsibilities of the Lead Independent Director are as
      follows:








9





(a)  to
      advise
      the Chairman of the Board as to an appropriate schedule of Vaso Board meetings,
      seeking to ensure that the independent directors can perform their duties
      responsibly while not interfering with the flow of Vaso’s
      operations;





(b)  to
      provide the Chairman of the Board with input as to the preparation of agendas
      for the Board and Committee meetings;





(c)  to
      advise
      the Chairman of the Board as to the quality, quantity, and timeliness of the
      flow of information from Vaso’s management that is necessary for the independent
      directors to effectively and responsibly perform their duties, and although
      Vaso’s management is responsible for the preparation of materials for the Board,
      the Lead Independent Director may specifically request the inclusion of certain
      material;





(d)  to
      recommend to the Chairman of the Board the retention of consultants who report
      directly to the Vaso Board;





(e)  to
      assist
      the Board and Vaso’s officers in assuring compliance with and implementation of
      the Company’s corporate governance policies and be principally responsible for
      recommending revisions to the corporate governance policies;





(f)  to
      coordinate and develop the agenda for, and moderate executive sessions of,
      Vaso’s Board’s independent directors, and act as principal liaison between the
      independent directors and the Chairman of the Board on sensitive
      issues;





(g)  to
      evaluate, along with the members of the Compensation Committee and the full
      Vaso
      Board, the CEO’s performance and meet with the CEO to discuss the Board’s
      evaluation; and





(h)  to
      recommend to the Chairman of the Board the membership of the various Vaso Board
      Committees, as well as selection of the Committee Chairs.





D.  Board
      Committees





1.  The
      Chairman of the Board of Directors shall not be the CEO of the Company. However,
      the Chairman of the Board of BioChemics, Inc., Vaso’s parent, or any BioChemics,
      Inc. director also may be the Chairman of the Board of Vaso or a Director of
      Vaso. The Chairman of the Board must meet the definition of “independent” as
      described herein.





2.  The
      Company’s by-laws should provide for annual election of the non-executive
      chairman, with a maximum tenure of six years.





3 *.*  All
      members of the Board of Directors shall serve for no more than ten years from
      the date of entry of the Final Judgment of Dismissal.





E.  Compensation
      Committee






10





1.  The
      Compensation Committee shall set annual and long-term performance goals for
      the
      CEO. The Compensation Committee shall meet annually to evaluate the CEO’s
      performance against such goals and determine compensation adjustments based
      on
      whether these goals have been achieved.





2.  The
      Compensation Committee shall meet at least once each calendar year in executive
      session, without the CEO.





3.  The
      Compensation Committee shall adopt, with Board of Directors’ approval, a
      resolution setting forth the following compensation principles:





(a)  Compensation
      arrangements shall emphasize pay for performance and encourage retention of
      those employees who enhance the Company’s performance.





(b)  Compensation
      arrangements shall promote ownership of the Company’s stock to align the
      interests of management, directors and stockholders.





(c)  In
      approving compensation, the recent compensation history of the executive,
      including special or unusual compensation payments, shall be taken into
      consideration.





(d)  Cash
      incentive compensation plans for senior executives shall link pay to achievement
      of financial goals set in advance by the Compensation Committee.





(e)  The
      Compensation Committee shall review annually the compensation of
      directors.





(f)  The
      granting of options for senior executives and cash compensation shall be based
      on the performance of Vaso in obtaining success in long term goals, including
      an
      increase in shareholders’ equity.





4.  The
      Compensation Committee shall publish a report annually in the Company’s Proxy
      Statement setting forth their justification for their compensation
      determinations for the CEO and CFO. This Report should also include a discussion
      of the Compensation Committee’s compensation principles discussed in the
      preceding paragraph.





F.  Audit
      and
      Oversight Committee





1.  The
      Board
      of Directors shall adopt a resolution broadening the mandate of the Audit
      Committee to create the Audit and Oversight Committee, which Committee shall
      perform the following functions in addition to the functions the Audit Committee
      currently performs:





(a)  In
      order
      to ensure that appropriate management and supervision is being afforded to
      significant actual and potential litigation claims, the Audit and Oversight
      Committee will have direct access to and meet as needed with the Risk Compliance
      Officer, without Company management present, as appropriate, who in turn will
      meet with the management employees responsible for overseeing litigation the
      Company is involved in; and






11





(b)  The
      Audit
      and Oversight Committee will regularly report all significant findings to the
      entire Board and relay information concerning all material aspects of all
      litigation the Company is involved in with sufficient detail to allow the Board
      to provide meaningful oversight.





2.  The
      Audit
      and Oversight Committee shall have at least one member with an accounting
      background.





3.  The
      Audit
      and Oversight Committee shall establish and enforce a policy that any
      independent auditor responsible for auditing Vaso’s financial statements shall
      not provide any consulting services to Vaso absent prior written consent of
      the
      Audit & Oversight Committee.





4.  The
      Audit and
      Oversight Committee should seek out all feasible alternatives for improving transparency
      and for verifying compliance with the Company’s ethics pledge.





5.  The
      Audit
      and Oversight Committee must approve all related party
      transactions.





G.  Corporate
      Governance Committee





1.  The
      Board
      shall adopt a resolution creating a Corporate Governance Committee. Each
      director, upon appointment, shall complete a course of introduction to the
      Company, either provided or approved by the Corporate Governance Committee.
      In
      addition, every director shall annually complete refresher training relating
      to
      accounting, disclosure, governance, compensation and/or industry developments,
      in accordance with guidelines to be set by the Corporate Governance
      Committee.





2.  The
      Corporate Governance Committee shall meet with each qualified prospective new
      Board nominee and then shall recommend whether such individual should be
      nominated for membership to the Board. Any prospective new Board nominee
      recommended by any shareholder shall be considered by the Corporate Governance
      Committee. The decision on whether to recommend such person to the Board shall
      be disclosed to shareholders after a full review by the current Board. Potential
      disqualifying conflicts of interest to be considered shall include:




(a)  Interlocking
      directorships; and





(b)  Substantial
      business, civic and/or social relationships with other members of the Board
      that
      could impair the prospective Board member’s ability to act independently from
      the other Board members.





3.  The
      performance of the non-executive chairman shall be evaluated each year by the
      Board. Where the chairman is not sufficiently active or successful in providing
      meaningful leadership for the Board, he or she should be replaced. The By-Laws
      shall provide for an annual election of the non-executive chairman by secret
      ballot. The vote shall be by the entire Board






12






commencing
      on the anniversary of the final resolution of the Derivative Litigation. In
      the
      event that a “no confidence” vote is reached by a majority of the Board (the
      chairman not voting), the Corporate Governance Committee, acting pursuant to
      its
      nominating powers, shall nominate, within three months, at least three
      candidates to be voted upon by the entire Board. In addition, the nominations
      shall include any candidate proposed by any shareholder with a 5% or more voting
      interest.





4.  The
      Corporate Governance Committee shall consist of not fewer than three members,
      each of whom shall possess expertise in governance issues or have substantial
      leadership experience.





5.  The
      By-Laws shall set forth the Corporate Governance Committee’s role and
      responsibilities, which should incorporate the following functions:





(i)  nominating
      individuals to serve on the Board or its committees (or as a committee
      chairman);





(ii)
      recommending to shareholders compensation levels for the Board;





(iii)
      recommending changes in the duties and responsibilities of committees;
      and





(iv)
      overseeing all proposed amendments to the Articles, By-Laws, governance
      guidelines or committee charters.





6.  The
      Board
      shall establish a formal charter for the Corporate Governance
      Committee.





7.  The
      By-Laws shall require the Corporate Governance Committee to meet not less than
      four times per year.





H.  Shareholder
      Suffrage





1.  Shareholders
      with an aggregate 5% ** of
      shares
      outstanding shall be permitted to nominate a candidate for director, with the
      requirement that any such nominee, if not accepted as a nominee of the Board
      of
      Directors, will appear on Vaso’s Proxy as a candidate with the designation
“Shareholder Nominated”. The candidate must provide Vaso with his consent to
      serve, must consent to a full credit and background check by Vaso, and must
      complete a Director and Officer Questionnaire; the nominating shareholder and
      the nominee must disclose to Vaso all dealings between them.





2.  Shareholders
      with an aggregate 5% ** of
      shares
      outstanding shall be permitted to call a special meeting of shareholders;
      and





3.  Subject
      to amendment of Vaso’s Articles of Incorporation, a simple majority of votes of
      the Class A and B shareholders voting together at any annual or special meeting
      shall have the power to remove a director, with or without cause.






13





4.  The
      Board
      of Directors shall be prohibited from amending or repealing any By-Law
      provisions adopted pursuant to this Settlement.





I.  Stock
      Options





For
      a
      period of at least 5 ** years,
      no
      options issued before the date of entry of the Final Judgment of Dismissal
      shall
      be repriced at a lower exercise price without prior shareholder approval. All
      plans for granting of options must be approved by the Company’s stockholders.
      The number of shares granted in relation to each option provided each year
      to
      each non-employee director pursuant to the Company’s 2003 Non-Employee Director
      Compensation Plan shall be limited to no more than 50,000 shares, subject to
      full anti-dilution protection.





J.
            Creation
                of an Insider Trading Policy





Vaso
      shall adopt an insider trading policy. The policy shall be signed by each
      executive officer and director. The policy shall include penalties, including
      termination of employment for any substantive violation of the policy, e.g.,
      improper trading or tipping (as opposed to procedural, e.g., late reporting
      of
      transactions). Substantive violations of the policy shall be reportable by
      the
      Company to the SEC.





K.  Strict
      Scrutiny of Related Party Transactions





Vaso
      shall not make strategic equity investments in or enter into material contracts
      (defined as full value for service or products exceeding $50,000) with companies
      in which a director or executive officer has an ownership interest of 2% or
      more
      absent the approval of the Corporate Governance and Audit
      Committees.





L.  Time
      Limitations





The
      foregoing corporate governance changes shall expire or terminate after three
      years of any class of Vaso’s securities being listed on the Nasdaq Stock Market,
      Inc. or a registered securities exchange, unless, in order to qualify for a
      listing on Nasdaq or the Exchange, the provision must be eliminated or modified,
      in which case Vaso shall be permitted to do so.





**IV.**


**RELEASES
      AND ENTRY OF FINAL JUDGMENT OF DISMISSAL**




1.  The
      obligations incurred in this Stipulation shall be in full and final disposition
      of the Derivative Litigation, the Delaware Derivative Litigation and any and
      all
      Released Claims against any and all Released Parties.








14




2.  Plaintiffs,
      any other stockholders of Vaso and Vaso, including their representatives, heirs,
      executors, administrators, trustees, estates, shareholders, predecessors,
      successors, partners, affiliates, agents and assigns, and any persons they
      represent, with respect to all Released Claims, fully and finally release,
      settle, relinquish and forever discharge, and shall forever be enjoined from
      prosecuting, and covenant not to prosecute in any forum or in any manner, any
      and all Released Claims against each and every one of the Released Parties.




3.  Plaintiffs
      will submit the proposed order (attached as Exhibit A) preliminarily approving
      the settlement to the Court after execution of this Stipulation.




4.  Nothing
      herein shall be deemed to alter, amend, change, enlarge, supersede and/or modify
      any existing indemnity rights and obligations between any Defendant and Vaso,
      whether such obligations exist by agreement or applicable statute(s). Such
      rights and obligations will remain unaffected by this Stipulation. Moreover,
      nothing herein shall be deemed to affect enforcement or other rights held by
      any
      governmental agency with jurisdiction over Vaso and Defendants.




5.  Upon
      approval of the Settlement by the Court, Plaintiffs shall submit and request
      entry of a Final Judgment of Dismissal with Prejudice in the form attached
      as
      Exhibit B pursuant to which Plaintiffs shall take nothing by their claims and
      which will finally dispose with prejudice all Released Claims. All Parties
      and
      their counsel agree not to appeal or otherwise contest such judgment and
      dismissal.




6.  Upon
      approval of the Settlement by the Court, a Stipulation and Order of Dismissal
      of
      the Delaware Derivative Litigation substantially in the form attached hereto
      as
      Exhibit C shall be filed in the Delaware Court of Chancery.




**V.**


**ATTORNEYS’
      FEES, EXPENSES AND CONDITIONS**








15




1a.  Payment
      of attorneys' fees to Plaintiffs Counsel shall be made on the 30th business
      day
      after the Final Judgment of Dismissal with Prejudice is entered by the Court,
      provided that no appeal is taken therefrom. Assuming no appeal of such Final
      Judgment, Vaso shall pay the fees and expenses (which may include, without
      limitation, the fees and expenses of all experts retained by Plaintiffs' Counsel
      to assist in the Derivative Litigation) of Plaintiffs' Counsel in an aggregate
      amount of $100,000 consisting of $15,000 in cash and $85,000 face amount two
      year 5% subordinated callable note convertible at $1.75 per share (with full
      dilution protection) as a unitary part of the Settlement. Such payment shall
      be
      made to Plaintiffs' Counsel c/o Barrett, Johnston & Parsley. If there is an
      appeal or review, said payment shall be made, assuming affirmance of the Final
      Judgment of Dismissal with Prejudice by such appeal or review, ten (10) business
      days thereafter.




1b.  Payment
      of attorneys' fees to Delaware Derivative Counsel shall be made on the 30th
      business day after the Stipulation and Order of Dismissal of the Delaware
      Derivative Litigation is entered by the Court, provided that no appeal is taken
      therefrom. Assuming no appeal of such Order of Dismissal, Vaso shall pay the
      fees and expenses (which may include, without limitation, the fees and expenses
      of all experts retained by Delaware Derivative Counsel to assist in the Delaware
      Derivative Litigation) of Delaware Derivative Counsel in an aggregate amount
      of
      $35,000 consisting of $10,000 in cash and $25,000 face amount two year 5%
      subordinated callable note convertible at $1.75 per share (with full dilution
      protection) as a unitary part of the Settlement. Such payment shall be made
      to
      Delaware Derivative Counsel c/o Federman & Sherwood. If there is an appeal
      or review, said payment shall be made, assuming affirmance of the Stipulation
      and Order of Dismissal of the Delaware Derivative Litigation by such appeal
      or
      review, ten (10) business days thereafter.






16




2.  The
      Settlement shall terminate and be of no further force or effect if any of the
      conditions set forth below occur, unless waived by Vaso and all the
      Defendants:




a.  the
      Court
      does not enter Orders approving this Stipulation and the Final Judgment of
      Dismissal with Prejudice; or




b.  any
      material part of the Stipulation or Final Judgment of Dismissal with Prejudice
      is overturned or set aside on appeal or review; or




3.  If
      any of
      the conditions in paragraph 2 of this Article V occur and are not waived by
      Vaso
      and all Defendants, the Parties shall revert to their litigation positions
      and
      the fact and terms of the Stipulation shall not be admissible in any trial,
      including but not limited to, the trial of the Derivative
      Litigation.




**VI.**


**NO
      ADMISSION OF WRONGDOING**




1.  This
      Stipulation, whether or not consummated, and any act performed or document
      executed pursuant to or in furtherance of the Stipulation or the Settlement
      or
      any negotiations, discussions, findings or proceedings in connection with this
      Stipulation or the Settlement:




a.  does
      not
      constitute and shall not be offered against any or all of the Defendants, Vaso
      or the Released Parties for any reason including, without limitation, as
      evidence of or construed as or deemed to be evidence of any presumption,
      concession, or admission by any or all Defendants or Vaso with respect to the
      truth of any fact alleged by Plaintiffs or the validity of any Released Claim
      that has been or could have been asserted in the Derivative Litigation, the
      Delaware






17






Derivative
      Litigation or in any litigation, or the deficiency of any defense that has
      been
      or could have been asserted in the Derivative Litigation, the Delaware
      Derivative Litigation or in any litigation, or of any liability, negligence,
      fault, or wrongdoing of any or all Defendants or Vaso.




b.  does
      not
      constitute and shall not be offered against any or all Defendants, Vaso or
      the
      Released Parties as evidence of or be construed as or deemed evidence of a
      presumption, concession or admission of any fault, misrepresentation or omission
      with respect to any statement or written document approved or made by any or
      all
      Defendants or Vaso.





c.  does
      not
      constitute and shall not be offered against any or all Defendants, Vaso or
      the
      Released Parties as evidence of or be construed as or deemed evidence of a
      presumption, concession or admission with respect to any liability, negligence,
      fault or wrongdoing, or in any way referred to for any other reason as against
      any of the Parties to this Stipulation, in any other civil, criminal or
      administrative action or proceeding (including, but not limited to, any formal
      or informal investigation or inquiry by the Securities and Exchange Commission
      or any other state or federal governmental or regulatory agency), other than
      such proceedings as may be necessary to effectuate the provisions of this
      Stipulation; *provided,
      however* ,
      that if
      this Stipulation is approved by the Court, any or all Defendants, Vaso or the
      Released Parties may refer to this Stipulation to effectuate the liability
      protection granted them hereunder.




d.  does
      not
      constitute and shall not be offered or construed against any or all Defendants,
      Vaso or the Released Parties as an admission or concession that the corporate
      governance reforms and attorneys’ fees and expenses paid hereunder represent
      remedies which could have been recovered after trial; and




e.  shall
      not
      be offered, construed or received in evidence as an admission, concession or
      presumption against Plaintiffs or their attorneys that any of their claims
      are
      without merit.








18




2.  Any
      or
      all Released Parties may file this Stipulation and/or the Final Judgment of
      Dismissal with Prejudice in any other action or proceeding that may be brought
      against any or all of them in support of a defense or counterclaim based on
      principles of res judicata, collateral estoppel, release, good faith settlement,
      judgment, bar or reduction, or any theory of claim preclusion or issue
      preclusion or similar defense or counterclaim. Plaintiffs understand,
      acknowledge and agree that the Defendants have denied and continue to deny
      each
      and all claims of alleged wrongdoing.




**VII.**


**MISCELLANEOUS
      PROVISIONS**




1.  This
      Stipulation constitutes the entire agreement among the Parties concerning the
      Settlement of the Derivative Litigation, and supersedes any prior agreements
      or
      understandings between the Parties with respect to the Settlement. No
      representations, warranties, or inducements have been made by any Party
      concerning this Stipulation or its exhibits, other than those contained and
      memorialized in this Stipulation.




2.  The
      Parties intend the Settlement to be a final and complete resolution of all
      Released Claims, including any and all allegations asserted or which could
      have
      been asserted on behalf of Vaso against Defendants with respect to all matters
      set forth in Plaintiffs’ Amended Consolidated Derivative Complaint. Further, the
      Parties agree that the attorneys’ fee amount paid and the other terms of the
      Settlement were negotiated at arm’s length in good faith and in the best
      interests of Vaso, and reflect a settlement that was reached voluntarily after
      consultation with experienced legal counsel. The Parties assert no claim of
      bad
      faith prosecution or defense. Defendants acknowledge that this case was brought
      in good faith by Plaintiffs and Plaintiffs' Counsel, and Plaintiffs acknowledge
      this case was defended in good faith by Defendants and their
      attorneys.






19




3.  Plaintiffs
      expressly represent and warrant that, in entering into the Settlement, they
      relied upon their own knowledge and investigation (including the knowledge
      of
      and investigation performed by Plaintiffs’ Counsel), and not upon any promise,
      representation, warranty or other statement made by or on behalf of any of
      the
      Defendants or Vaso not expressly contained in this Stipulation.




4.  This
      Stipulation may not be modified or amended, nor may any of its provisions be
      waived (except the conditions set forth in paragraph 2 of Article V, which
      may
      only be waived by Vaso and each Defendant), except by a writing signed by all
      Parties hereto or their successors-in-interest.




5.  The
      headings herein are used for the purpose of convenience only and are not meant
      and shall not be construed to have any legal effect.




6.  The
      administration and consummation of the Settlement shall be under the authority
      of the Court, and the Court shall retain jurisdiction for the purpose of
      entering orders enforcing the terms of the Settlement.




7.  The
      waiver by any Party of any breach of this Stipulation by any Party hereto shall
      not be deemed a waiver of any other prior or subsequent breach of this
      Stipulation or be deemed a waiver by any other Party.




8.  This
      Stipulation may be executed in one or more counterparts. All executed
      counterparts and each of them shall be deemed to be one and the same instrument,
      provided that counsel for the Parties to this Stipulation shall exchange among
      themselves original signed counterparts. Any signature to this Stipulation,
      to
      the extent signed and delivered by facsimile, shall be treated in all manners
      and respects as an original signature and shall be considered to have the same
      binding legal effect as if it were the original signed version thereof delivered
      in person. At the request of a Party, any other Party so executing and
      delivering this Stipulation by facsimile shall re-execute original forms thereof
      and deliver them to the requesting Party. No Party shall raise the use of
      facsimile to deliver or transmit a signature as a defense to the formation
      or
      enforceability of this Stipulation, and each such Party forever waives any
      such
      defense.






20




9.  The
      terms
      of this Stipulation shall be binding upon, and inure to the benefit of the
      successors and assigns of the Parties and the Released Parties.




10.  The
      construction, interpretation, operation, effect and validity of this
      Stipulation, and all documents necessary to effectuate it, shall be governed
      by
      the laws of the State of Delaware without regard to its conflicts of laws.
      Exclusive venue over any dispute arising from or relating to this Stipulation
      shall lie in the United States District Court for the District of Massachusetts,
      and the Parties expressly consent to personal jurisdiction in Massachusetts
      in
      connection with any action to enforce the Settlement.




11.  This
      Stipulation shall not be construed more strictly against one party than another
      merely by virtue of the fact that it, or any part of it, may have been prepared
      by counsel for one of the Parties, it being recognized that it is the result
      of
      arm’s length negotiations between the Parties, and all Parties have contributed
      substantially and materially to the preparation of this
      Stipulation.




12.  All
      counsel and any other person executing this Stipulation, or any related
      settlement documents, warrant and represent that they have full authority to
      do
      so and that they have the authority to take appropriate action required or
      permitted to be taken under this Stipulation to effectuate its
      terms.






21




13.  Counsel
      for Plaintiffs, counsel for the Defendants, and counsel for Vaso agree to
      cooperate fully with one another in seeking prompt Court approval of the
      Settlement and the entry of a Final Judgment of Dismissal with Prejudice, and
      promptly to agree to execute all such other documents and to take all such
      other
      action as may be reasonably required to obtain the Court’s final approval of the
      Settlement and the entry of a Final Judgment of Dismissal with Prejudice. The
      Parties shall promptly apply to the Court for approval of the Settlement. The
      Parties shall use their best efforts to obtain Court approval of the
      Settlement.




14.  Any
      agreements and orders entered during the course of the Derivative Litigation
      relating to the confidentiality of information shall survive this
      Stipulation.




15.  Nothing
      in this Stipulation, or the negotiations relating thereto, is intended to or
      shall be deemed to constitute a waiver of any applicable privilege or doctrine,
      including, without limitation, the attorney-client privilege or work product
      doctrine.




16.  The
      Parties (i) acknowledge their intent to consummate the Settlement and (ii)
      agree
      to cooperate as reasonably necessary to effectuate and implement this
      Stipulation, and to use their commercially reasonable efforts to accomplish
      this
      Stipulation’s terms and to consummate its contemplated
      transactions.




17.  The
      Parties acknowledge, represent and warrant to each other that the mutual
      releases and payments hereunder are adequate consideration for the consideration
      given.




18.  The
      Plaintiffs and Plaintiffs’ Counsel represent and warrant that they, individually
      and collectively, have not assigned any rights, claims or causes of action
      that
      were asserted or could have been asserted in the Derivative Litigation in
      connection with or arising from any of the Released Claims.






22




19.  The
      Parties acknowledge that their respective counsel has express authority to
      execute this Stipulation on their behalf and that such signature by counsel
      shall have the same force and binding effect as if signed by the
      Party.




STIPULATED
      AND AGREED TO:





/s/
      Timothy L. Miles


GEORGE
      E.
      BARRETT


DOUGLAS
      S. JOHNSTON, JR.


TIMOTHY
      L. MILES


BARRETT,
      JOHNSTON & PARSLEY


217
      Second Avenue, North


Nashville,
      TN 37201


Phone:
      (615) 244-2202


Facsimile:
      (615) 252-3798





Lead
      Counsel for Plaintiffs








/s/
      Richard S. Kraut/JH


DILWORTH
      PAXSON LLP


RICHARD
      S. KRAUT


1818
      N
      Street NW, Suite 400


Washington,
      DC 20036


Phone:
      (202) 452-0900


Facsimile:
      (202) 452-0930





Counsel
      for Vaso Active Pharmaceuticals, Inc.,


BioChemics,
      Inc., John Masiz, Kevin J. Seifert,


Bruce
      A.
      Shear, Brian J. Strasnick, William P.


Adams,
      Robert E. Anderson, Gary Fromm


and
      Joseph Frattaroli











23










/s/
      Michael G. Bongiorno


WILMER
      CUTLER PICKERING HALE


AND
      DORR
      LLP


JEFFREY
      B. RUDMAN


MICHAEL
      G. BONGIORNO


60
      State
      Street


Boston,
      MA 02109


Phone:
      (617) 526-6000


Facsimile:
      (617) 526-5000





Counsel
      for Vaso Active Pharmaceuticals, Inc.,


BioChemics,
      Inc., John Masiz, Kevin J. Seifert,


Bruce
      A.
      Shear, Brian J. Strasnick, William P.


Adams,
      Robert E. Anderson, Gary Fromm


and
      Joseph Frattaroli








/s/
      John A. Sten


JOHN
      A.
      STEN


KAY
      B.
      LEE


GREENGERG
      TRAURIG, LLP


One
      International Place


Boston,
      MA 02110


Phone:
      (617) 310-6083





Counsel
      for Stephen G. Carter











/s/
                William B. Federman
            Agreeing
                to Section 4, Par. 6 and Section 5, Par. 1WILLIAM
                B. FEDERMAN
            only
                of the Stipulation and Agreement of
                Settlement


FEDERMAN
      & SHERWOOD


120
      N.
      Robinson Avenue, Suite 2720


Oklahoma
      City, OK 73102


Phone:
      (405) 235-1560


Facsimile:
      (405) 239-2112














24














JOSEPH
      A.
      ROSENTHAL


ROSENTHAL,
      MONHAIT, GROSS & GODDESS, P.A.


Suite
      1401, 919 N. Market Street


Wilmington,
      DE 19899-1070





Counsel
      for Plaintiff in Delaware Derivative Litigation







25