EXHIBIT 10.1

                          MERLIN GROUP MANAGEMENT CORP.

                                                                     May 7, 2004


Via Telecopy

Mr. Rick Strattan
CTD Holdings Inc.
27317 NW 78 Avenue

High Springs, Florida 32643

         Re:      CTD Holdings, Inc. (collectively, the "Company")

Dear Mr. Strattan:

         We  are  pleased  that  you  wish  to  engage  us  to  perform  certain
hereinafter  specified  consulting and advisory  services for the Company.  This
letter is intended to set forth our  understanding as to the nature and scope of
the consulting  and advisory  services we have agreed to render for the Company,
the amount of our fees for these  services  and the terms upon which the Company
will make payment of these fees.

         You have  engaged us to assist the  Company in  correcting  its capital
structure  and  putting  certain  securities  in place  which will  ensure  your
continued  control of the  Company as it expands  its  operations  (the "Phase 1
Services"). In connection with these transactions, as consideration for a series
of  preferred  stock to be issued to you by the  Company  you will return to the
Company  the  1,029,412  shares  of  common  stock  recently  issued  to  you as
consideration  for certain assets acquired by the Company.  You have agreed that
you will return those shares to the treasury of the Company immediately upon the
filing of articles  of  amendment  to the  Company's  Articles of  Incorporation
creating such preferred shares,  which such filing shall occur 20 days after the
mailing of the definitive  proxy  statement which is contemplated as part of the
aforedescribed  recapitalization.  Our fee for the Phase 1  Services  is 343,137
shares of the Company's common stock (the  "Compensation  Shares"),  which is an
amount  equal to  one-third  of  1,029,412  shares.  This fee is due and payable
concurrent  with the filing of such  articles  of  amendment.  The  Compensation
Shares shall be, when issued,  fully paid,  non-assessable  and freely tradeable
under the Securities  Act of 1933 pursuant to a  registration  statement on Form
S-8 to be filed with the SEC.  The  Compensation  Shares shall be issued in such
names  and in such  denominations  as we  instruct  and in  accordance  with the
applicable rules regarding the usage of Form S-8.

         At our discretion we may engage additional  independent  contractors to
assist us in  rendering  the Phase 1 Services  and the fees of these  additional
independent contractors will be our responsibility.  We have advised you that we
are not attorneys and as such cannot provide you with legal advice in connection
with  the  Phase 1  Services  or  otherwise.  As an  inducement  to  accept  the
engagement  you have  advised us that the  Company  will  obtain such advice and
guidance from its corporate and securities  counsel and independent  auditors as
you  deem  necessary  in  conjunction  with the  project  discussed  herein.  In
rendering the Phase 1 Services,  we will liaison with the  Company's  securities
and corporate counsel and independent auditors.  The Company will be responsible
for fees and costs of its  securities  and  corporate  counsel  and  independent
auditors  with  respect to the Phase 1 Services.  The Company  will advise these
professionals  as to  our  role  in  assisting  the  Company  pursuant  to  this
engagement and instruct these  professionals  to cooperate with us and make such
information  available to us as we deem  appropriate to undertake our engagement
for the  Company.  All final  content  of any  document  of the  Company  is the
responsibility  of the  Company.  While we will assist the Company in  preparing
such  content,  we will  make  no  effort  to  independently  verify  any of the
information contained therein.

         You will also reimburse us or pay directly any pre-approved expenses we
incur in providing the Phase 1 Services for you, such as travel expense,  filing
fees, photocopying, and similar expenses. The Company will be billed monthly for
any  pre-approved  costs  incurred  during  the  previous  month  and,  upon the
conclusion of our engagement,  for any previously  unbilled amounts.  Payment is
due upon the receipt of our bill.

         In connection with our engagement,  we acknowledge that the Company may
disclose to us certain  non-public  information.  We further understand that the
Company requires that such information be kept confidential by us.  Accordingly,
in connection with your engagement of our firm hereunder, we agree as follows:

     1. For purposes of our this letter  agreement,  "Confidential  Information"
may include, but is not limited to, customer lists, strategic and business plans
and projections,  projects,  trade secrets,  technical  information,  protocols,
computer software,  product descriptions,  production methods, training manuals,
output displays, designs, drawings,  processes,  systems, concepts,  procedures,
formulae,  test data,  know-how,  improvements,  price lists,  cost information,
financial data,  supplier lists,  vendor lists,  sketches and plans or any other
compilation   of   information   whatsoever,   whether   written  or  unwritten.
Confidential Information shall also include any process or demonstrations viewed
by an employee, agent or representative of a party which is either identified as
being or  embodying  Confidential  Information  or falls  within the  definition
contained in this paragraph.  Any information  which is expressly  designated as
confidential  or  proprietary  by the Company  shall be treated as  Confidential
Information  as referred to in this letter  agreement,  but  information  not so
expressly designated shall still be treated as Confidential  Information so long
as the information falls within the definition contained in this paragraph.

     2. We agree that we will keep all Confidential Information confidential. We
will disclose Confidential Information only to those of our officers, directors,
partners, employees, agents and representatives who have (and only to the extent
such persons have) a legitimate need for access to such Confidential Information
(the "Third Parties") in connection with the foregoing purposes.  We will advise
all  Third  Parties  having  access  to  Confidential   Information   that  such
information is confidential and that access to Confidential Information is to be
limited and shall direct them not to (and such Third Parties shall not) disclose
Confidential  Information  or provide  access to such  information  to any third
party.

     3. Our obligation to keep  confidential all  Confidential  Information does
not apply to Confidential  Information  which,  without breach of any obligation
hereunder:

               (a)  is or becomes  publicly known or generally  known within the
                    trade;

               (b)  is known by us prior to  disclosure  by the Company;

               (c)  is  lawfully  obtained  by us after the  termination  of our
                    engagement  from a source  other than the  Company  with the
                    right to disclose such Confidential Information without
                    restriction; or

               (d)  is required to be disclosed by law or court order,  provided
                    that if we determine that any Confidential  Information must
                    be disclosed as a result of any law or court order,  we will
                    notify  the  Company  as  soon  as  possible  prior  to such
                    disclosure  so that the  Company  may take such action as it
                    may deem appropriate to protect such information.

         In the  performance of our services,  we shall be obligated to act only
in good  faith,  and shall not be liable to the  Company  for errors in judgment
that are not the result of gross negligence or willful misconduct.  By executing
this letter  agreement,  the Company  agrees to  indemnify  and hold us and each
person  who  controls  our  company  within  the  meaning  of  Section 15 of the
Securities  Act of 1933 or Section 20 of the  Securities  Exchange Act of 1934 ,
and the our officers, directors,  employees,  accountants,  attorneys and agents
(the  "Indemnitees")  harmless  against  any and all losses,  claims,  expenses,
damages  or  liabilities,  joint or  several,  to which  they or any of them may
become  subject  (including  the costs of any  investigation  and all reasonable
attorneys' fees and costs) or incurred by them, to the fullest extent lawful, in
connection with any pending or threatened litigation, legal claim or proceeding,
whether or not resulting in any liability,  arising out of or in connection with
the services  rendered by us hereunder or any  transactions  in connection  with
this letter agreement; provided, however, that the indemnity agreement contained
in this paragraph shall not apply to any such losses,  claims, related expenses,
damages or liabilities  arising out of our gross negligence,  willful misconduct
or fraud as may be determined by a court of competent jurisdiction.

         Any disputes regarding the interpretation or enforcement of this letter
agreement  may be resolved  only by the Florida  courts,  and we and the Company
each consent to the exclusive jurisdiction of the Circuit or County Court of the
17th Judicial  Circuit in and for Broward County,  Florida,  for the purposes of
resolving  any and all  disputes  arising  from  or in any way  relating  to the
subject  matter of this letter  agreement.  Each party waives  their  respective
right to bring any action in any other court. The prevailing party in any action
to construe or enforce the rights and duties of the parties  arising  from or in
any way  relating  to this  letter  agreement  will be  entitled  to  reasonable
attorneys'  fees and costs  incurred.  Florida law will govern all of the rights
and duties of the  parties  arising  from or  relating in any way to the subject
matter of this letter  agreement,  and will be applied to  construe  and enforce
this letter agreement.

         No changes or  modifications  of this  letter  agreement  will be valid
unless in writing and signed by all of the parties to this letter agreement.  No
waiver of any provision of this letter agreement will be valid unless in writing
and signed by the person or party against whom charged.

         If  the  foregoing  is  agreeable  to  you,  please   acknowledge  your
understanding and agreement by  countersigning  this letter agreement and faxing
same to 410-884-3683. We appreciate your confidence in us and we assure you that
we will make every  effort to perform  our  services  in a prompt and  efficient
manner.

                                                 Sincerely,

                                             /s/ Steven T. Dorrough
                                                 Steven T. Dorrough

Agreed To:

CTD Holdings Inc.

By: /s/ C.E. Rick Strattan
---------------------------------
C.E. Rick Strattan
Date:5/21/04

         Rick Strattan, President


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                          MERLIN GROUP MANAGEMENT CORP.

                                                              May 24, 2004


Via Telecopy 386-454-8134

Mr. Rick Strattan
CTD Holdings Inc.
27317 NW 78 Avenue

High Springs, Florida 32643

         Re:      CTD Holdings, Inc. (collectively, the "Company")

Dear Mr. Strattan:

         In furtherance  to our engagement  letter with the Company dated May 7,
2004,  as  executed  by you on May 21,  2004,  this  letter  shall  serve as our
instructions  to issue the aggregate of 343,137  shares of the Company's  common
stock which are  compensation  for the services being rendered to the Company in
accordance therewith as follows:

                  Name and address                                No. of shares

                  Steven T. Dorrough                                   171,569
                  610-AE Battlefield Street
                  Suite 184
                  Springfield, Missouri 65807

                  Ella Chesnutt                                        171,568
                  6200 Devon Drive
                  Columbia, Maryland 21044



                                                            Sincerely,

                                                        /s/ Steven T. Dorrough
                                                            Steven T. Dorrough

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