**Exhibit      10.4**

**EXECUTIVE      EMPLOYMENT AGREEMENT**

**15**
**th      **

**day      of May, 2006**
**COBALIS      CORP. (the "Company")**
**GERALD      YAKATAN**
**(the      "Executive") **

**PREAMBLE**

| 1.   | **TERM.**                The initial term of this Agreement shall be for the period commencing                on                May 15, 2006 (the "Start Date"), and ending on the third anniversary                of                the Start Date (the "Initial Term"), provided, however, that the                term of                this Agreement shall be automatically extended for successive one                (1) year                periods thereafter (each, a "Renewal Period") unless either the Company                or                the Executive shall have given written notice to the other party                at least                ninety (90) days prior to the end of the Term of Agreement (as hereinafter                defined), that the Term of Agreement shall not be so extended. The                Initial                Term together with each Renewal Period, if any, are collectively                referred                to herein as the "Term of Agreement". The Executive's employment                hereunder                shall be coterminous with the Term of Agreement, unless sooner terminated                as provided in Section 5 hereof. |
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| 2.   | **EMPLOYMENT.**                During the term of the Executive's employment under this                Agreement: |
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| (a)   | Subject                to the terms and conditions of this Agreement, the Executive shall                be                employed as Chief Executive Officer (the “CEO”) of the Company, or such                other senior executive capacity as may be mutually agreed to in writing                by                the parties. As the CEO, the Executive shall have active and general                supervision and management over the business and affairs of the Company                and shall have full power and authority to act for all purposes for                and in                the name of the Company in all matters except where action of the                Company’s Board of Directors (“the Board”) is required by law, the By-laws                of the Company, or resolutions of the Board. The Executive agrees                to                discharge all of the duties normally associated with such positions,                to                faithfully and to the best of his abilities perform such other services                consistent with his position as a senior executive as may from time                to                time be assigned to him by the Board or Company's Chairman of the                Board of                Directors (the "Chairman"). Executive agrees that he shall not engage                in                any other business activities of any kind which would give rise to                a                conflict of interest for the Executive with respect to his duties                and                obligations to the Company. |
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| (b)   | The                Executive shall report directly to the                Board. |
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| (c)   | The                Executive shall participate in all meetings of the Board (other than                executive sessions and those meetings or portions of meetings specifically                identified in advance, at which Executive's performance will be                discussed), unless, in its reasonable discretion, the Board determines                that a conflict exists which requires it to exclude Executive from                a                meeting. |
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| 3.**  ** | **COMPENSATION.**                During the term of the Executive's employment under this                Agreement: |
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| (a)**  ** | **Base                Salary.**                The Company agrees to pay or cause to be paid to the Executive during                the                Term of Agreement a base salary at the rate of $300,000 (three hundred                thousand) per annum or such increased amount as the Board may from                time to                time determine (hereinafter referred to as the "Base Salary"). Such                Base                Salary shall be payable in accordance with the Company's customary                practices applicable to its executives. Such Base Salary shall be                reviewed                at least annually by the Board and may be further increased (but                not                decreased) in such amounts as the Board in its discretion may decide;                and |
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| (b)**  ** | **Signing                Bonus.**                The Executive shall receive a special one-time signing bonus on the                Start                Date in the amount of 100,000 (One-Hundred Thousand) restricted shares                of                the common stock, par value $.01 per share, of the Company (the “Common                Stock”), and after completion of thirty (90) days following the Start Date                in the amount of 100,000 (One-Hundred Thousand) restricted shares                of the                Common Stock. |
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| (c)   | **Stock                Options.** |
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| (i)   | **Initial                Grant.**                On                or prior to the Start Date, the Company hereby grants to the Executive                an                option (the "Initial Stock Option") to purchase 1,000,000 (One Million)                shares of the Common Stock at the purchase/exercise price of $1.40                per                share, with a term of not less than five (5) years from the Start                Date.                This Initial Stock Option shall vest and be exercisable as follows:                1/3 of                the shares vest and become exercisable as of the Start Date; 1/3                of the                shares shall vest and become exercisable one year after the Start                Date;                and 1/3 of the shares shall vest and become exercisable two years                after                the Start Date. Notwithstanding the foregoing, the Initial Stock                Option                shall vest and be fully exercisable upon a Change in Control and                shall                vest as otherwise provided herein upon termination of the Executive's                employment. |
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| (ii)**  ** | **Future                Grants.**                The Executive shall be entitled to participate in future stock option                grants (the "Future Stock Options") as determined by the Board or                any                dully authorized Committee of the                Board. |
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| (iii)   | **Option                Agreement.**                The Initial Stock Option and any Future Stock Options shall be evidenced                by agreements in customary form for grants of stock options to executive                officers of the Company under the terms of the Company’s Stock Option and                Award Plan (the “Plan”) and consistent with the terms and conditions of                this Agreement. |
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| (d)   | **Performance                Bonus.**                During the Term of this Agreement, the Executive shall be eligible                to                receive a performance bonus based on the Executive’s performance and the                Company reaching a certain performance and business related milestones                (i.e. successful completion of second III Phase clinical trial, NDA                filing, new product acquisition, licensing partnership, and future                capital) in the amount and form to be determined at the time within                the                sole discretion by the Board. |
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| 4.   | **OTHER                BENEFITS.**                During the term of the Executive's employment under this                Agreement: |
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| (a)   | **Employee                Benefits.**                The Executive shall be entitled to participate in all employee benefit                plans, practices and programs maintained by the Company and made                available                to employees generally including, without limitation, all pension,                retirement, profit sharing, savings, medical, hospitalization, disability,                dental, vision, life or travel accident insurance benefit plans.                The                Executive's participation in such plans, practices and programs shall                be                on the same basis and terms as are applicable to employees of the                Company                generally. |
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| (b)**  ** | **Executive                Benefits.**                The Executive shall be entitled to participate in all executive benefit                or                incentive compensation plans now maintained or hereafter established                by                the Company for the purpose of providing compensation and/or benefits                to                executives of the Company including, but not limited to, any supplemental                retirement, salary continuation, stock option, deferred compensation,                supplemental medical, dental, vision or life insurance, or other                bonus or                incentive compensation plans. Unless otherwise provided herein, the                Executive's participation in such plans shall be on the same basis                and                terms, as other senior executives of the Company, and shall be reasonably                equivalent to the benefit levels and reward opportunities applicable                to                the Executive as in effect on the date hereof. No additional compensation                provided under any of such plans shall be deemed to modify or otherwise                affect the terms of this Agreement or any of the Executive's entitlements                hereunder. |
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| (c)   | **Fringe                Benefits and Perquisites.**                The Executive shall be entitled to all fringe benefits and perquisites                (e.g. professional membership dues, additional reimbursement for                uncovered                medical expenses, executive life insurance and tax advisory services)                generally made available by the Company to its senior executives. |
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| (d) ** ** | **Eligibility                Waiver of Waiting Times**.                Subject to the terms of this Agreement, the Executive (and to the                extent                applicable under the terms and benefits of such plans which apply                to the                Dependents shall have the right to participate in all employee plans                and                benefits currently existing or hereafter granted by the Company to                its                employees and all waiting periods under such plans and benefits                arrangements will be waived to the full extent possible unless such                waiver                would require the Company to waive waiting periods for other employees.                In                the event that the provisions of any such employee plans or benefit                arrangements do not permit immediate waiver of waiting periods, comparable                benefits will be provided to the Executive and the Dependents outside                such                plans and arrangements. |
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| (e)   | **Business                Expenses.**                Upon submission of proper invoices in accordance with the Company's                normal                procedures, the Executive shall be entitled to receive prompt                reimbursement of all reasonable out-of-pocket business, entertainment                and                travel expenses incurred by him in connection with the performance                of his                duties hereunder or for promoting, pursuing or otherwise furthering                the                business or interest of the                Company. |
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| (f)   | **Office                and Facilities.**                The Executive shall be provided with an appropriate office in Irvine,                California, with such secretarial and other support facilities as                are                commensurate with the Executive's status with the Company and adequate                for                the performance of his duties                hereunder. |
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| (g)**  ** | **Vacation                and Sick Leave.**                The Executive shall be entitled, without loss of pay, to absent himself                voluntarily from the performance of his employment under this Agreement,                pursuant to the following: |
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| (i)   | The                Executive shall be entitled to annual vacation in accordance with                the                policies as periodically established by the Board for similarly situated                executives of the Company, which shall in no event be less than 4                (four)                weeks per year; |
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| (ii)   | In                addition to the aforesaid paid vacations, the Executive shall be                entitled,                without loss of pay, to absent himself voluntarily from the performance                of                his employment for such additional periods of time and for such valid                and                legitimate reasons the Board in its discretion may determine. Further,                the                Board shall be entitled to grant to the Executive a leave or leaves                of                absence with or without pay at such time or times and upon such terms                and                conditions as the Board in its discretion may determine;                and |
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| (iii)   | The                Executive shall be entitled to sick leave (without loss of pay) in                accordance with the Company's policies as in effect from time to                time,                which shall in no event be less than six (6) days per                year. |
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| 5.   | **TERMINATION.**                The Executive's employment hereunder may be terminated under the                following                circumstances: |
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| (a)   | **Death.**                The Executive's employment shall be terminated as of the date of                the                Executive's death and the Executive's Dependents shall be entitled                to the                benefits provided in Section 7(b)                hereof. |
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| (b)   | **Disability.**                The Company may terminate the Executive's employment after having                established the Executive's Disability, subject to the payment by                the                Company to the Executive of the benefits provided in Section 7(b)                hereof.                For purposes of this Agreement, "Disability" shall mean the Executive's                inability to substantially perform his duties and responsibilities                hereunder by reason of any physical or mental incapacity for two                or more                periods of ninety (90) consecutive days each in any three hundred                and                sixty (360) day period, as determined by a physician with no history                of                prior dealings with the Company or the Executive, as reasonably agreed                upon by the Company and the                Executive. |
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| (c)   | **Cause.**                The Company may terminate the Executive's employment for "Cause",                effective as of the date of the Notice of Termination (as defined                in                Section 6 below) and as evidenced by a resolution adopted in good                faith by                two-thirds (2/3) of the entire Board, subject to the payment by the                Company to the Executive of the benefits provided in Section 7(a)                hereof.                A termination for Cause is a termination made because the Executive                has                (A) committed an act of fraud or embezzlement against the Company                or any                affiliate thereof, or (B) a knowing and willful unauthorized disclosure                of                Confidential Information (as defined in Section 10 below) of the                Company,                which disclosure results in material damage to the Company, or (C)                a                breach of one or more of the following duties to the Company which                continues after written notice thereof specifying the particular                events or                conditions which constitute the alleged breach and the specific cure                requested by the Company and a reasonable opportunity to cure: (1)                the                duty not to take actions which would reasonably be viewed by the                Company                as placing the Executive's interest in a position adverse to the                interests                of the Company, or (2) the duty not to engage in self-dealing with                respect                to the Company's assets, properties or business opportunities; or                (D) been                convicted (or entered a plea of nolo contendere) for the commission                of (1)                a felony or (2) a crime involving fraud, dishonesty or moral turpitude;                or                (E) engaged in intentional misconduct as an employee of the Company,                which                misconduct or violation results in material damage to the Company                or its                reputation and continues after written notice thereof specifying                the                particular events or conditions which constitute the alleged misconduct                or                violation and the specific cure requested by the Company and a reasonable                opportunity to cure (if such misconduct is susceptible to cure by                the                Executive), including, but not limited to (1) intentional violations                by                the Executive of written policies of the Company, or specific directions                of the Board, which policies or directives are not illegal (or do                not                involve illegal conduct) and do not require the Executive to violate                reasonable business ethical standards, or (2) intentional violations                of                the Company's code of corporate conduct; or (F) failed, after written                notice from the Company to render services to the Company in accordance                with this Agreement or the Executive's position and responsibilities                with                the Company in a manner that amounts to gross neglect in the performance                of his duties to the Company. |
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| (d)   | **Without                Cause.**                The Company may terminate the Executive's employment without Cause.                The                Company shall deliver to the Executive a Notice of Termination (as                defined                in Section 6 below) not less than thirty (30) days prior to the                termination of the Executive's employment without Cause and the Company                shall have the option of terminating the Executive's duties and                responsibilities (but not his employment) prior to the expiration                of such                thirty-day notice period, subject to the payment by the Company of                the                benefits provided in either Section 7(c) or 7(e) hereof, as may be                applicable. |
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| (e)   | **Good                Reason.**                The Executive may terminate his employment for "Good Reason" (as                defined                below) by delivering to the Company a Notice of Termination (as defined                in                Section 6 below) not less than thirty (30) days prior to the termination                of the Executive's employment for Good Reason. The Company shall                have the                option of terminating the Executive's duties and responsibilities                (but not                his employment) prior to the expiration of such thirty-day notice                period,                subject to the payment by the Company of the benefits provided in                either                Section 7(c) or 7(e) hereof, as may be applicable. For purposes of                this                Agreement, Good Reason shall mean the occurrence of any of the events                or                conditions described in Subsections (i) through (viii) hereof which                are                not cured by the Company (if susceptible to cure by the Company)                within                fifteen (15) days after the Company has received written notice from                the                Executive specifying the particular events or conditions which constitute                Good Reason and the specific cure requested by the                Executive. |
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| (i) ** ** | **Diminution                of Responsibility.**                (A) A change in the Executive’s status, title, position or                responsibilities (including reporting responsibilities) which in                the                Executive’s reasonable judgment constitutes a material diminution in the                Executive's status, title, position or responsibilities (including                reporting responsibilities) as in effect immediately prior thereto;                or (B)                the assignment to the Executive of any duties or responsibilities                (including reporting responsibilities) which are in the Executive’s                reasonable judgment materially inconsistent with such status, title,                position or responsibilities (including reporting responsibilities);                or                (C) any removal of the Executive from or failure to reappoint the                Executive to the position of the CEO, except in connection with the                termination of the Executive's employment as provided for elsewhere                in                this Agreement; |
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| (ii)**  ** | **Salary                Reduction.**                (A) A reduction in the Executive's Base Salary as defined in Section                3(a);                or (B) a failure by the Company to increase the Executive’s Base Salary                within any twelve (12) month period by the average percentage increase                during such period of the base salaries of the three most senior                executives of the Company other than the                Executive; |
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| (iii)   | **Relocation.**                The Company's requiring the Executive to be based at any place other                than                the Company's current headquarters or within a 30-mile radius thereof; |
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| (iv)**  ** | **Discontinuation                of Material Compensation or Benefit Plan.**                The failure by the Company to continue in effect any material compensation                or benefit plan in which the Executive was participating, including,                but                not limited to, the Company's deferred compensation plan and 401(k)                plan                without providing the Executive with compensation and benefits                substantially equal (in terms of benefit levels and/or reward                opportunities) to those provided for under such                plan; |
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| (v)**  ** | **Bankruptcy.**                The initiation by or against the Company of proceedings under the                United                States Bankruptcy Code or under state insolvency laws, which proceedings                are not vacated within 60 days of notice thereof to the                Company; |
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| (vi)**  ** | **Breach                by Company.**                Material breach by the Company of the terms and conditions of this                Agreement or any other agreement between the Executive and the Company                after formal notice by the Executive and a reasonable opportunity                to                cure; |
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| (vii)   | **Purported                Termination.**                Any purported termination of the Executive’s employment for Cause by the                Company which does not comply with the terms of Section 5 of this                Agreement; and |
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| (viii)   | **Failure                to Successfully Assign.**                Failure of the Company to obtain an agreement from any successor                or assign                of the Company to assume and agree to perform the Company's obligations                under this or any other agreement between the Executive and the Company. |
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| (f)   | **Good                Reason Arising Prior To Change in Control.**                Any event or condition described in Sections 5(e)(i) through (viii)                which                occurs prior to a Change in Control, but which (A) was at the request                of a                third party who has taken steps reasonably calculated to effect a                Change                in Control, or (B) otherwise arose in connection with a Change in                Control,                will constitute Good Reason for purposes of this Agreement notwithstanding                that it occurred prior to a Change in                Control. |
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| (g)   | **Without                Good Reason.**                The Executive may voluntarily terminate his employment without Good                Reason                by delivering to the Company a Notice of Termination not less than                thirty                (30) days prior to the termination of the Executive's employment                and the                Company shall have the option of terminating the Executive's duties                and                responsibilities (but not his employment) prior to the expiration                of such                thirty-day notice period, subject to the payment by the Company to                the                Executive of the benefits provided in Section 7(a) hereof through                the last                day of such notice period. |
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| (h)   | **Non-Renewal                of Term of Agreement.**                Either party may elect not to extend the Term of Agreement pursuant                to                Section 1 hereof, subject to the payment by the Company to the Executive                of the benefits provided in Section 7(d)                hereof. |
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| 6.   | **NOTICE                OF TERMINATION.**                Any purported termination by the Company or by the Executive shall                be                communicated by written Notice of Termination to the other party                hereto.                For purposes of this Agreement, a "Notice of Termination" shall mean                a                notice which (1) indicates a termination of the Executive’s employment                date, (2) the specific termination provision in this Agreement relied                upon, and (3) sets forth in reasonable detail the facts and circumstances                claimed to provide a basis for termination of the Executive's employment                under the provision so indicated. For purposes of this Agreement,                no such                purported termination of the Executive's employment hereunder shall                be                effective without such Notice of                Termination. |
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| 7.   | **COMPENSATION                UPON TERMINATION.**                Upon termination of the Executive's employment during the Term of                Agreement, the Executive shall be entitled to the following                benefits: |
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| (a)   | **Termination                by the Company for Cause or by the Executive Without Good                Reason.**                If                the Executive's employment is terminated by the Company for Cause                or by                the Executive Without Good Reason, the Company shall pay the Executive                all                amounts earned hereunder through the date of termination of the                Executive's employment, including: |
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| (i)   | any                accrued and unpaid Base Salary; |
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| (ii)   | reimbursement                for any and all monies advanced to the Executive or expenses incurred                in                connection with the Executive's employment for reasonable and necessary                expenses incurred by the Executive on behalf of the Company for the                period                ending on the date of termination of the Executive’s                employment; |
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| (iii)   | any                accrued and unpaid vacation pay; |
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| (iv)   | any                previous compensation which the Executive has previously deferred                (including any interest earned or credited thereon), subject to the                terms                and conditions of the applicable deferred compensation plans then                in                effect; and |
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| (v)   | any                stock options and stock appreciation rights (including Initial Stock                Option and Future Stock Options) granted to the Executive and vested                through the date of termination of the Executive’s employment pursuant to                the vesting schedule in Section 3(c)(i) shall become immediately                exercisable for a remaining life of the Stock Option, or a period                which                shall be no less than twelve (12) months following the date of termination                of the Executive’s employment, whichever is                greater. |
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| (vi)   | The                foregoing items in Section 7(a)(i) through 7(a)(v) being collectively                referred to as the "Accrued                Compensation". |
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| (b)   | **Termination                Upon Death or Disability.**If                the Executive's employment is terminated by the Company upon the                Executive's Disability or by reason of the Executive's death, the                Executive (or his beneficiaries, as applicable) shall be entitled                to the                following: |
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| (i)   | any                Accrued Compensation (Section 7(a)(i) through 7(a)(v)) through the                date of                termination of the Executive’s                employment; |
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| (ii)   | all                restrictions on any outstanding awards granted by the Company (including                restricted stock awards) granted to the Executive shall lapse and                such                awards shall become fully (100%) and immediately vested, and all                stock                options and stock appreciation rights (including Initial Stock Option                and                Future Stock Options) granted to the Executive and vested through                the date                of termination of the Executive’s employment pursuant to the vesting                schedule in Section 3(c)(i) shall become immediately exercisable                for a                remaining life of the Stock Option, or a period which shall be no                less                than twelve (12) months following the date of termination of the                Executive’s employment, whichever is                greater; |
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| (iii)   | for                a number of months equal to twelve (12), the Company shall at its                expense                continue on behalf of the Executive and/or Executive’s dependents and                beneficiaries (the “Dependents”) the life insurance, disability, medical,                dental, vision and hospitalization benefits which were being provided                to                the Executive and/or Dependents at the time Notice of Termination                is                given. In the event that the provisions of any such employee benefit                arrangements do not permit continuing coverage, then the Company                shall                provide the Dependents with substantially equivalent coverage through                other sources. The benefits provided in this Section 7(b)(iii) shall                be no                less favorable to the Dependents, in terms of amounts and deductibles                and                costs to them, than the coverage provided the Dependents under the                plans                providing such benefits at the time Notice of Termination is given.                This                Subsection (iii) shall not be interpreted so as to limit any benefits                to                which the Dependents may be entitled under any of the Company's employee                benefit plans, programs or practices following the Executive's termination                of employment, including without limitation, retiree medical and                life                insurance benefits; and |
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| (iv)   | the                Executive's entitlement to any other compensation or benefits hereunder                shall be determined in accordance with the Company's employee benefit                plans and other applicable programs and practices then in                effect. |
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| (c)   | **Termination                by the Company Without Cause or by the Executive for Good                Reason.**                If                the Executive's employment by the Company shall be terminated by                the                Company without Cause, or if the Executive terminates his employment                for                Good Reason, the Executive shall be entitled to the                following: |
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| (i)   | any                Accrued Compensation (Section 7(a)(i) through 7(a)(v)) through the                date of                termination of the Executive’s                employment; |
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| (ii)   | if                the Executive voluntarily elects and agrees not to engage in Prohibited                Activities (as hereinafter defined) for a period of one (1) year                after the                date of termination of the Executive’s employment, the Company shall pay                the Executive as additional compensation for the periods subsequent                to the                termination date, an amount in cash equal to one (1) time the sum                of the                Executive's annual Base Salary at the highest rate in effect at any                time                within the ninety (90) day period ending on the date the Notice of                Termination is delivered. The additional compensation provided in                the                previous sentence shall be payable in substantially equal monthly                installments for a period of twelve months. If the Executive does                not so                voluntarily elect and agree or otherwise engages in such Prohibited                Activities, then the Executive's eligibility to receive the                post-employment benefits provided for in this Section 7(c)(ii) shall                immediately thereafter terminate. The Executive's entitlement to                any other                compensation or benefits hereunder shall be determined in accordance                with                the Company's employee benefit plans and other applicable programs                and                practices then in effect. For the purposes of this Agreement, the                term                "Prohibited Activities" means directly or indirectly engaging as                an owner,                employee, consultant or agent of any entity that manufactures, markets                and                distributes, or plans to (directly or indirectly through related                entities,                joint ventures, strategic alliances or other affiliated entities),                prescription or non-prescription pharmaceuticals or medical devices                for                treatments in the fields of allergy (each a "Competitive Business").                Notwithstanding the foregoing, it shall not be considered a "Prohibited                Activity" for the Executive (i) to own or purchase any corporate                securities of any entity that is regularly traded on a recognized                stock                exchange or over-the-counter market so long as the Executive does                not own,                in the aggregate, 5% or more of the voting equity securities of any                such                entity or (ii) to perform consulting services for an entity engaged                in a                Competitive Business to the extent the Executive has given the Company                at                least 30 days advance notice of the Executive's desire to perform                such                consulting services and both the Board (or the board of directors                of a                successor entity to the Company, as the case may be), in their sole                and                absolute discretion, have consented in writing to the performance                of such                consulting services by the                Executive; |
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| (iii)   | all                restrictions on any outstanding awards granted by the Company (including                restricted stock awards) granted to the Executive shall lapse and                such                awards shall become fully (100%) and immediately vested, and all                stock                options and stock appreciation rights (including Initial Stock Option                and                Future Stock Options) granted to the Executive and vested through                the date                of termination of the Executive’s employment pursuant to the vesting                schedule in Section 3(c)(i) shall become immediately exercisable                for a                remaining life of the Stock Option, or a period which shall be no                less                than twelve (12) months following the date of termination of the                Executive’s employment, whichever is greater;                and |
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| (iv)   | for                a number of months equal to twelve (12), the Company shall at its                expense                continue on behalf of the Executive and the Dependents the life insurance,                disability, medical, dental, vision and hospitalization benefits                which                were being provided to the Executive at the time Notice of Termination                is                given. In the event that the provisions of any such employee benefit                arrangements do not permit continuing coverage, then the Company                shall                provide the Executive with substantially equivalent coverage through                other                sources. The benefits provided in this Section 7(c)(iv) shall be                no less                favorable to the Executive, in terms of amounts and deductibles and                costs                to him, than the coverage provided the Executive under the plans                providing                such benefits at the time Notice of Termination is given. This Subsection                (iv) shall not be interpreted so as to limit any benefits to which                the                Executive or the Dependents may be entitled under any of the Company's                employee benefit plans, programs or practices following the Executive's                termination of employment, including without limitation, retiree                medical                and life insurance benefits. |
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| (d)   | **Termination                Due to Non -- Renewal of Term of                Agreement.** |
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| (i)   | If                the Company notifies the Executive under Section 1 hereof that it                shall                not extend the Term of Agreement for any Renewal Period, the Executive                shall be entitled to the benefits provided in Section 7(c)                above. |
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| (ii)   | If                the Executive notifies the Company under Section 1 hereof that he                shall                not extend the Term of Agreement for any Renewal Period, the Executive                shall be entitled to the benefits provided in Section 7(a)                above. |
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| (e)   | **Termination                by the Company Without Cause or by the Executive for Good Reason                Following                a Change in Control.**                If                the Executive's employment by the Company shall be terminated by                the                Company without Cause or by the Executive for Good Reason within                twelve                (12) months following a Change in Control (as defined in Section                8 below),                the Executive shall be entitled to the following: |
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| (i)   | any                Accrued Compensation (items in Section 7(a)(i) through 7(a)(v)) through                the date of termination of the Executive’s                employment; |
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| (ii)   | if                the Executive voluntarily elects and agrees not to engage in Prohibited                Activities (as hereinafter defined) for a period of one (1) year                after the                date of termination of the Executive’s employment, the Company shall pay                the Executive as additional compensation for the periods subsequent                to the                termination date, an amount in cash equal to two (2) times the sum                of the                Executive's annual Base Salary at the highest rate in effect at any                time                within the ninety (90) day period ending on the date the Notice of                Termination is delivered. The additional compensation provided in                the                previous sentence shall be payable in substantially equal monthly                installments for a period of twenty-four (24) months. If the Executive                does not so voluntarily elect and agree or otherwise engages in such                Prohibited Activities, then the Executive's eligibility to receive                the                post-employment benefits provided for in this Section 7(d)(ii) shall                immediately thereafter terminate. The Executive's entitlement to                any other                compensation or benefits hereunder shall be determined in accordance                with                the Company's employee benefit plans and other applicable programs                and                practices then in effect. For the purposes of this Agreement, the                term                "Prohibited Activities" means directly or indirectly engaging as                an owner,                employee, consultant or agent of any entity that manufactures, markets                and                distributes, or plans to (directly or indirectly through related                entities,                joint ventures, strategic alliances or other affiliated entities),                prescription or non-prescription pharmaceuticals or medical devices                for                treatments in the fields of allergy (each a "Competitive Business").                Notwithstanding the foregoing, it shall not be considered a "Prohibited                Activity" for the Executive (i) to own or purchase any corporate                securities of any entity that is regularly traded on a recognized                stock                exchange or over-the-counter market so long as the Executive does                not own,                in the aggregate, 5% or more of the voting equity securities of any                such                entity or (ii) to perform consulting services for an entity engaged                in a                Competitive Business to the extent the Executive has given the Company                at                least 30 days advance notice of the Executive's desire to perform                such                consulting services and both the Board (or the board of directors                of a                successor entity to the Company, as the case may be), in their sole                and                absolute discretion, have consented in writing to the performance                of such                consulting services by the                Executive; |
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| (iii)   | all                restrictions on any outstanding awards granted by the Company (including                restricted stock awards) granted to the Executive shall lapse and                such                awards shall become fully (100%) and immediately vested, and all                stock                options and stock appreciation rights granted to the Executive (including                Initial Stock Option and Future Stock Options) shall become fully                (100%)                and immediately exercisable for a remaining life of the Stock Option,                or a                period which shall be no less than twenty-four (24) months following                the                Termination date, whichever is greater;                and |
|-------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| (iv)   | for                a number of months equal to twenty-four (24), the Company shall at                its                expense continue on behalf of the Executive and the Dependents the                life                insurance, disability, medical, dental and hospitalization benefits                which                were being provided to the Executive at the time Notice of Termination                is                given. In the event that the provisions of any such employee benefit                arrangements do not permit continuing coverage, then the Company                shall                provide the Executive with substantially equivalent coverage through                other                sources. The benefits provided in this Section 7(c)(iv) shall be                no less                favorable to the Executive, in terms of amounts and deductibles and                costs                to him, than the coverage provided the Executive under the plans                providing                such benefits at the time Notice of Termination is given. This Subsection                (iv) shall not be interpreted so as to limit any benefits to which                the                Executive or the Dependents may be entitled under any of the Company's                employee benefit plans, programs or practices following the Executive's                termination of employment, including without limitation, retiree                medical                and life insurance benefits. |
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| (f)   | The                Executive shall not be required to mitigate the amount of any payment                provided for under this Section 7 by seeking other employment and                no such                payment shall be offset or reduced by the amount of any compensation                or                benefits provided to the Executive in any subsequent                employment. |
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| 8.   | **CHANGE                IN CONTROL.**                For purposes of this Agreement, a "Change in Control" shall mean                any of                the following events: |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (a)   | the                acquisition (other than from the Company) by any person (as such                term is                defined in Section 13(c) or 14(d) of the Securities Exchange Act                of 1934,                as amended (the "1934 Act")) of beneficial ownership (within the                meaning                of Rule 13d-3 promulgated under the 1934 Act) of twenty-five-percent                (25%)                or more of the combined voting power of the Company's then outstanding                voting securities; |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b)   | the                individuals who, as of the date hereof, are members of the Board                (the                "Incumbent Board"), cease for any reason to constitute at least two                thirds                (2/3) of the Board, unless the election, or nomination for election                by the                Company's stockholders, of any new director was approved by a vote                of at                least two thirds (2/3) of the Incumbent Board, and such new director                shall, for purposes of this Agreement, be considered as a member                of the                Incumbent Board; |
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| (c)   | approval                by stockholders or the Board of: |
|-----------------|----------------------------------------------------------|

| (i)   | a                merger or consolidation involving the Company and an independent                third                party if the stockholders of the Company, immediately before such                merger                or consolidation, do not, as a result of such merger or consolidation,                own, directly or indirectly, more than seventy percent (70%) of the                combined voting power of the then outstanding voting securities of                the                corporation resulting from such merger or consolidation in substantially                the same proportion as their ownership of the combined voting power                of the                voting securities of the Company outstanding immediately before such                merger or consolidation; or |
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----

| (ii)   | an                agreement for the sale or other disposition of all or substantially                all of                the assets of the Company to an independent third party;                and |
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| (d)   | the                liquidation or dissolution of the                Company. |
|-----------------|------------------------------------------------------------------------------|

| 9.   | **FEDERAL                EXCISE TAX.**                The Company shall reimburse the Executive for any excise tax imposed                by                Section 4999 of the Internal Revenue Code of 1986, as amended (the                "Code")                on any portion of the compensation or benefits payable to the Executive                in                connection with a Change of Control. The Executive and the Company                agree                to reasonably cooperate to mitigate the amount of any such tax that                might                become payable. The Company shall pay to the Executive the payments,                or                portions thereof, provided for in this Section 9 not later than fifteen                (15) days prior to the date on which such taxes, or portions thereof,                are                due as determined by the tax counsel referred to below. Tax counsel                selected by the Company and reasonably acceptable to the Executive                shall                determine whether the payments provided for by this Section 9 shall                be                required, based on the actual tax rates to which the Executive is                subject                at the time. The Executive shall, on a confidential basis, provide                such                counsel with such information as such counsel reasonably requests                in                connection with such determination. All determinations of tax counsel                shall be binding on the Executive and the Company. Tax counsel shall                determine that payments shall be due hereunder only if, and to the                extent                that, it is more likely than not that the payments or benefits are                subject                to a tax. In making the determinations required by this Section 9,                tax                counsel may rely on benefit consultants, accountants or other experts.                The                Company agrees to pay all reasonable fees and expenses of such tax                counsel. If, subsequent to the payment to the Executive of payments                pursuant to this Section 9, the tax counsel referred to in this Section                9                reasonably determines that the amount of the payments paid pursuant                to                this Section 9 are greater than, or less than, the amount required                to have                been paid, the Executive shall reimburse the Company an amount, or                the                Company shall pay to the Executive an additional amount, respectively,                based upon such determination. In the event that tax counsel referred                to                in this Section 9 reasonably determines that the Executive is required                to                pay excise tax, interest or penalties to a governmental taxing authority                as a result of his non-payment of taxes where such tax counsel had                determined that such taxes need not be paid, the Company shall pay                to the                Executive an additional amount equal to (A) the amount of such interest                and/or penalties, (B) the excise tax which was not paid and (C) any                excise                tax and any other taxes imposed by the Code or under state or local                law on                the payments provided for in this                sentence. |
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| 10.   | **RECORDS                AND CONFIDENTIAL DATA:**                Proprietary Inventions. |
|-----------------|------------------------------------------------------------------------------------------|

----

| (a)   | The                Executive acknowledges that in connection with the performance of                his                duties during the Term of Agreement the Company will make available                to the                Executive, or the Executive will have access to, certain Confidential                Information (as defined below) of the Company and its affiliates.                The                Executive acknowledges and agrees that any and all Confidential                Information learned or obtained by Executive during the course of                his                employment by the Company or otherwise, whether developed by the                Executive                alone or in conjunction with others or otherwise, shall be and is                the                property of the Company and its                affiliates. |
|-----------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b)   | The                Confidential Information will be kept confidential by the Executive,                will                not be used in any manner which is detrimental to the Company, will                not be                used other than in connection with the Executive's discharge of his                duties                hereunder, and will be safeguarded by the Executive from unauthorized                disclosure. |
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| (c)   | For                the purposes of this Agreement, "Confidential Information" shall                mean all                confidential and proprietary information of the Company and its affiliates                that has been created, discovered or developed or has otherwise become                known to the Company (including, without limitation, information                created,                discovered, developed or made known by or to the Executive during                the                period of or arising out of his employment hereunder), or in which                property rights have been assigned or otherwise conveyed to the Company,                which information has commercial value in the business in which the                Company is engaged; by way of illustration and not by limitation,                Confidential Information includes information derived from reports,                investigations, experiments, research, work in progress, drawing,                designs,                plans, proposals, codes, marketing and sales programs, client lists,                shareholder lists, client mailing lists, supplier lists, financial                projections, cost summaries, pricing formula, marketing studies relating                to prospective business opportunities and all other concepts, ideas,                materials, or information prepared or performed for or by the Company                or                its affiliates. For purposes of this Agreement, the Confidential                Information shall not include and the Executive's obligation's shall                not                extend to (i) information which is or becomes, without violation                by the                Executive of this Agreement, generally available to the public and                (ii)                information obtained by the Executive other than pursuant to or in                connection with this employment. Notwithstanding the foregoing, if                the                Executive is required by law or legal process to disclose the Confidential                Information, the Executive shall provide the Company with prompt                notice so                that the Company may seek a protective order or other appropriate                remedy                and/or waive compliance with this Section 10. If, in the absence                of a                protective order or other remedy or the receipt of a waiver by the                Company, the Executive is nonetheless, in the opinion of counsel,                legally                compelled to disclose the Confidential Information, the Executive                may,                without liability hereunder, disclose only that portion of the                Confidential Information which such counsel advises is legally required                to                be disclosed, provided, however, that the Executive exercise reasonable                efforts to preserve the confidentiality of the Confidential Information,                including without limitation, cooperating with the Company to obtain                an                appropriate protective order or other reliable assurance that confidential                treatment will be accorded the Confidential                Information. |
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----

| (d)   | The                Executive hereby assigns to the Company any rights he may acquire                during                his employment hereunder in all Confidential Information and agrees                that                all Inventions (as defined below) will be the sole property of the                Company                and its assigns, and the Company and its assigns will be the sole                owner of                all the patents and other rights in connection therewith. The Executive                hereby assigns to the Company any rights he may acquire during the                period                of his employment hereunder in all Inventions and agrees to assist                the                Company in every proper way (but at the Company's expense) to obtain                and                from time to time enforce patents on Inventions in any and all countries.                The Executive shall execute all documents for use in applying for                and                obtaining such patents thereon and enforcing same, as the Company                may                desire, together with any assignments thereof to the Company or persons                designated by it. The Executive's obligation to assist the Company                in                obtaining and enforcing patents for Inventions in any and all countries                will continue beyond the termination of employment hereunder, but                the                Company will compensate the Executive at a reasonable rate after                such                termination for time actually spent by him at the Company's request                on                such assistance. The Executive acknowledges that, in accordance with                Section 2872 of the California Labor Code, the assignment provisions                in                this paragraph (d), do not apply to Inventions for which no equipment,                supplies, facility, or trade secret information of the Company was                used,                which were developed entirely on the Executive's own time, and (i)                which                do not relate (a) to the business of the Company or (b) to the Company's                actual or demonstrably anticipated research or development or (ii)                which                do not result from any work performed by the Executive for the Company.                The Executive has identified on Schedule I hereto all inventions                or                improvements relevant to the subject matter of the Executive's employment                hereunder which have been made or conceived or first reduced to practice                by the Executive alone or jointly with others prior to the date hereof                which the Executive desires to remove from the operation of this                Agreement; and the Executive represents that such list is complete.                If                there is no such list on Schedule I, the Executive represents that                he has                made no such inventions and improvements as of the date                hereof. |
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| (e)   | For                purposes of this Agreement, "Inventions" shall mean all improvements,                inventions, formulae, processes, techniques, know-how and data whether                or                not patentable, made or conceived or reduced to practice or learned                by the                Executive, either alone or jointly with others, during the Executive's                employment hereunder which are related to or useful in the business                of the                Company, or result from tasks assigned to the Executive by the Company,                or                result from use of premises owned, leased or contracted for by the                Company. |
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| (f)   | The                Executive's obligations under this Section 10 shall survive the                termination of the Term of                Agreement. |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------|

| 11.   | **COVENANT                NOT TO SOLICIT.** |
|-----------------|---------------------------------------------|

| (a)   | To                protect the Confidential Information and other trade secrets of the                Company, the Executive agrees, during the term of this Agreement                and for a                period of twelve months after the Executive's cessation of employment                with                the Company, not to solicit or participate in or assist in any way                in the                solicitation of any employees or consultants of the Company. For                purposes                of this covenant, "solicit" or "solicitation" means directly or indirectly                influencing or attempting to influence employees or consultants of                the                Company to become employed with any other person, partnership, firm,                corporation or other entity. The Executive agrees that the covenants                contained in this Section 11 are reasonable and desirable to protect                the                Confidential Information of the                Company. |
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----

| (b)   | It                is the intent and desire of the Executive and the Company that the                restrictive provisions of this Section 11 be enforced to the fullest                extent permissible under the laws and public policies as applied                in each                jurisdiction in which enforcement is sought. If any particular provision                of this Section 11 shall be determined to be invalid or unenforceable,                such covenant shall be amended, without any action on the part of                either                party hereto, to delete therefrom the portion so determined to be                invalid                or unenforceable, such deletion to apply only with respect to the                operation of such covenant in the particular jurisdiction in which                such                adjudication is made. |
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| (c)   | The                Executive's obligations under this Section 11 shall survive the                termination of the Term of                Agreement. |
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| 12.**  ** | **REMEDIES                FOR BREACH OF OBLIGATIONS UNDER SECTIONS 10 OR 11                HEREOF.**                The Executive acknowledges that the Company will suffer irreparable                injury, not readily susceptible of valuation in monetary damages,                if the                Executive breaches his obligations under Sections 10 or 11 hereof.                Accordingly, the Executive agrees that the Company will be entitled,                in                addition to any other available remedies, to seek injunctive relief                against any breach or prospective breach by the Executive of his                obligations under Sections 10 or 11 hereof. The Company shall seek                such                relief in any Federal or state court where venue would be appropriate                based upon the Executive's principal residence or his principal place                of                business, or, at the Company's election, in any other state in which                the                Executive maintains his principal residence or his principal place                of                business as provided for in Section 13(j) below. The Executive hereby                submits to the non-exclusive jurisdiction of all those courts for                the                purposes of any actions or proceedings instituted by the Company                to obtain                that injunctive relief, and the Executive agrees that process in                any or                all of those actions or proceedings may be served by registered mail,                addressed to the last address provided by the Executive to the Company,                or                in any other manner authorized by law. Notice in such proceedings                shall be                given in the manner required by law. The Executive further agrees                that, in                addition to any other remedies available to the Company by operation                of                law or otherwise, in the event the Executive willfully and materially                breaches any of his obligations under Sections 10 or 11 hereof, he                shall                not be entitled to any amounts which may otherwise be payable under                the                terms of Sections 7(b), 7(c), 7(d) and 7(e) hereof and under the                terms of                the benefit plans of the Company in which he participates and to                which he                might otherwise then be entitled by virtue hereof. Nothing in Sections                10                or 11 shall operate as a diminution of the Executive's obligations                under                the Company's standard agreements pertaining to the subject matter                of such                sections. |
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| 13.   | **MISCELLANEOUS.** |
|-----------------|--------------------|

| (a)   | **Successors                and Assigns**. |
|-----------------|--------------------------------------------|

----

| (i)   | This                Agreement shall be binding upon and shall inure to the benefit of                the                Company, its successors and assigns and the Company shall require                any                successor or assign to expressly assume and agree to perform this                Agreement in the same manner and to the same extent that the Company                would                be required to perform if no such succession or assignment had taken                place. The term “the Company” as used herein shall include such successors                and assigns. The term "successors and assigns" as used herein shall                mean a                corporation or other entity acquiring all or substantially all the                assets                and business of the Company (including this Agreement) whether by                operation of law or otherwise, or any entity employing the Executive                which                has spun off or split off from the Company;                and |
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| (ii)   | Neither                this Agreement nor any right or interest hereunder shall be assignable                or                transferable by the Executive, his beneficiaries or legal representatives,                except by will or by the, laws of descent and distribution. This                Agreement                shall inure to the benefit of and be enforceable by the Executive's                legal                personal representatives. |
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| (b)   | **Non-exclusivity                of Rights.**                Nothing in this Agreement will prevent or limit the Executive's continuing                or future participation in any written benefit, bonus, incentive                or other                plan or program provided by the Company or any of its subsidiaries                and for                which the Executive may qualify, and nothing in this Agreement will                limit                or reduce such rights as the Executive may have under any other written                agreements with the Company or any of its subsidiaries. Amounts which                are                vested benefits or which the Executive is otherwise entitled to receive                under any plan or program of the Company or any of its subsidiaries                will                be payable in accordance with such plan or program, except as explicitly                modified by this Agreement. |
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| (c)   | **Settlement                of Claims.**                The Company's obligation to make the payments provided for in this                Agreement and otherwise to perform its obligations hereunder will                not be                affected by any circumstances, including, without limitation, any                set-off,                counterclaim, recoupment, defense or other right which the Company                may                have against the Executive or                others. |
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| (d)**  ** | **Indemnification.** |
|---------------------|----------------------|

| (i)   | The                Company agrees that if the Executive is made a party to or involved                in, or                is threatened to be made a party to or otherwise to be involved in,                any                action, suit or proceeding, whether civil, criminal, administrative                or                investigative (a "Proceeding"), by reason of the fact that he is                or was a                director, officer or employee of the Company or any affiliate, or                is, or                was serving at the request of the Company or any affiliate as a director,                officer, member, employee or agent of another corporation, limited                liability corporation, partnership, joint venture, trust or other                enterprise, including service with respect to employee benefit plans,                whether or not the basis of such Proceeding is the Executive's alleged                action in an official capacity while serving as a director, officer,                member, employee or agent, the Executive shall be indemnified and                held                harmless by the Company and each relevant against any and all liabilities,                losses, expenses, judgments, penalties, fines and amounts reasonably                paid                in settlement in connection therewith, and shall be advanced reasonable                expenses (including attorneys' fees) as and when incurred in connection                therewith, to the fullest extent legally permitted or authorized                by                Company’s by-laws or, if greater, by the laws of the State of Nevada, as                may be in effect from time to time. The rights conferred on the Executive                by this Section 13 (d)(i) shall not be exclusive of any other rights                which                the Executive may have or hereafter acquire under any statute, the                by-laws, agreement, vote of stockholders or disinterested directors,                or                otherwise. In this regard, the Executive shall have full discretion                as to                choice of counsel in all matters subject to indemnification under                this                Agreement. The indemnification and advancement of expenses provided                for by                this Section shall continue as to the Executive after he ceases to                be a                director, officer or employee and shall inure to the benefit of his                heirs,                executors and administrators, and shall survive any termination or                non-renewal of this Agreement. In addition, the Executive shall also                be                entitled to indemnification from the Company on terms no less advantageous                to the Executive as are provided to any officer or director of the                Company; and |
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----

| (ii)   | For                the Initial Term and thereafter, the Executive shall be covered by                any                directors' and officers' liability policy maintained by Employer                from time                to time. |
|------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (e)   | **Legal                Counsel**.                The Executive acknowledges that he has had the opportunity to consult                with                legal counsel of his choice in connection with the drafting, negotiation                and execution of this Agreement and related employment                arrangements. |
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| (f)   | **Notice.**                For the purposes of this Agreement, notices and all other communications                provided for in the Agreement (including the Notice of Termination)                shall                be in writing and shall be deemed to have been duly given when personally                delivered or sent by Certified mail, return receipt requested, postage                prepaid, addressed to the respective addresses last given by each                party to                the other, provided that all notices to the Company shall be directed                to                the attention of the Chairman. All notices and communications shall                be                deemed to have been received on the date of delivery thereof or on                the                third business day after the mailing thereof, except that notice                of change                of address shall be effective only upon                receipt. |
|-----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (g)   | **Withholding.**                The Company shall be entitled to withhold the amount, if any, of                all taxes                of any applicable jurisdiction required to be withheld by an employer                with                respect to any amount paid to the Executive hereunder. The Company,                in its                sole and absolute discretion, shall make all determinations as to                whether                it is obligated to withhold any taxes hereunder and the amount                hereof. |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (h)   | **Modification**.                No provision of this Agreement may be modified, waived or discharged                unless such waiver, modification or discharge is agreed to in writing                and                signed by the Executive and the Company. No waiver by either party                hereto                at any time of any breach by the other party hereto of, or compliance                with, any condition or provision of this Agreement to be performed                by such                other party shall be deemed a waiver of similar or dissimilar provisions                or conditions at the same or at any prior or subsequent                time. |
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| (i)   | **Arbitration**.                If any legally actionable dispute arises under this Agreement or                otherwise                which cannot be resolved by mutual discussion between the parties,                then                the Company and the Executive each agree to resolve that dispute                by                binding arbitration before an arbitrator experienced in employment                law.                Said arbitration will be conducted in accordance with the rules applicable                to employment disputes of the Judicial Arbitration and Mediation                Services                ("JAMS") and the law applicable to the claim. The parties shall have                30                calendar days after notice of such arbitration has been given to                attempt                to agree on the selection of an arbitrator. In the event the parties                are                unable to agree in such time, JAMS will provide a list of nine available                arbitrators and an arbitrator will be selected from such nine-member                panel                provided by JAMS by the parties alternately striking out one name                of a                potential arbitrator until only one name remains. The party entitled                to                strike an arbitrator first shall be selected by a toss of a coin.                The                parties agree that this agreement to arbitrate includes any such                disputes                that the Company may have against the Executive, or the Executive                may have                against the Company and/or its related entities and/or employees,                arising                out of or relating to this Agreement, or Executive's employment,                or the                Executive's termination, including, but not limited to, any claims                of                discrimination or harassment in violation of applicable law and any                other                aspect of the Executive's compensation, employment, or the Executive's                termination. The parties further agree that arbitration as provided                for in                this Section 13(i) is the exclusive and binding remedy for any such                dispute and will be used instead of any court action, which is hereby                expressly waived, except for any request by either party for temporary                or                preliminary injunctive relief pending arbitration in accordance with                applicable law or for breaches by the Executive of the Executive's                obligations under Sections 10 or 11 above, or an administrative claim                with                an administrative agency. The parties agree that the arbitration                provided                herein shall be conducted in Orange County, California unless otherwise                mutually agreed, or unless the Executive's primary place of employment                is                a different location. The Company shall pay the cost of any arbitration                brought pursuant to this paragraph, including filing fees, administrative                fees and the costs of the arbitrator, excluding, however, the filing                fees                of the Executive if he is the moving party to the extent such fees                are                equal to or less than those that would applicable to file a complaint                in                the Orange County Superior Court and the cost of representation of                the                Executive unless such cost is awarded in accordance with law or otherwise                awarded by the arbitrators. |
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| (j)   | **Governing                Law.**                This Agreement shall be governed by and construed and enforced in                accordance with the laws of the State of California applicable to                contracts executed in and to be performed entirely within such State,                without giving effect to the conflict of law principles                thereof. |
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| (k)   | **No                Conflicts.**                The Executive represents and warrants to the Company that he is not                a                party to, or otherwise bound by any agreement or arrangement (including,                without limitation, any license, covenant, or commitment of any nature),                or subject to any judgment, decree, or order of any court or                administrative agency, that would conflict with or will be in conflict                with, or in any way preclude, limit or inhibit the Executive's ability                to                execute this Agreement, or to carry out his duties and responsibilities                hereunder. |
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----

| (l)**  ** | **Trade                Secrets of Others.**                The Company acknowledges that the Executive, as a current and/or                former                employee or independent contractor of another company, may previously                have                been privy to trade secrets and/or confidential information of such                other                company, and may be under an obligation to such other company to                maintain                the confidentiality of such trade secrets or confidential information.                Accordingly, to the extent the Executive is under such an obligation,                the                Executive shall not: (i) bring any records, notes, files, drawings,                documents, plans and like items, provided to him in confidence by                such                other company, or any copies thereof, relating to or containing or                disclosing confidential information or trade secrets of any such                other                company on the premises of the Company, or otherwise use such documents                and items in the performance of services for the Company; or (ii)                disclose                any confidential information or trade secrets provided to the Executive                in                confidence by such other company to any other employee of the Company;                provided, however, that this prohibition only applies to documents                or                information that the Executive obtained or learned before the beginning                of                his relationship with the Company. |
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| (m)**  ** | **Severability**.                The provisions of this Agreement shall be deemed severable and the                invalidity or unenforceability of any provision shall not affect                the                validity or enforceability of the other provisions                hereof. |
|---------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (n)   | **Entire                Agreement.**                This Agreement constitutes the entire agreement between the parties                hereto                and supersedes all prior agreements, if any, understandings and                arrangements, oral or written, between the parties hereto with respect                to                the subject matter hereof. No agreement or representations, oral                or                otherwise, express or implied, with respect to the subject matter                hereof                have been made by either party which are not expressly set forth                in this                Agreement. |
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|         | **THE                COMPANY**                                |
|--------------|---------------------------------------------------------------|
|         |                                                          |   |
|         | COBALIS              CORP.                                    |
|    |                                                     |    |
|         | By:                                                 | /s/ Radul              Radovich |
|         | Name: Radul RadovichIts: Chairman of the                Board |

|         |                                                  |
|--------------|--------------------------------------------------|
|         |                                             |   |
|         | **THE              EXECUTIVE**    |
|    |                                        |    |
|         | By:                                    | /s/ Gerald              Yakatan |
|         | Name: Gerald                Yakatan              |